Federal Register - Pipeline and Hazardous Materials Safety ...

12-10-93Vol. 58 No. 236Pages 64871-65098

FridayDecember 10, 1993

0

V

w

-71

= m

II Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993

~wj~ I

FEDERAL REGISTER Published daily, Monday through Friday,(not published on Saturdays. Sundays, or on official holidays), bythe Office of the Federal Register, National Archives and RecordsAdministration, Washington, DC 20408, under the Federal RegisterAct (49 Stat. 500, as amended; 44 U.S.C. Ch. 15) and theregulations of the Administrative Committee of the Federal Register(1 CFR Ch. I). Distribution is made only by the Superintendent ofDocuments, U.S. Government Printing Office, Washington, DC20402.The Federal Register provides a uniform system for makingavailable to the public regulations and legal notices issued byFederal agencies. These include Presidential proclamations andExecutive Orders and Federal agency documents having generalapplicability and legal effect, documents required to be publishedby act of Congress and other Federal agency documents of publicinterest. Documents are on file for public inspection in the Officeof the Federal Register the day before they are published, unlessearlier filing is requested by the issuing agency.The seal of the National Archives and Records Administrationauthenticates this issue of the Federal Register as the official serialpublication established under the Federal Register Act. 44 U.S.C.1507 provides that the contents of the Federal Register shall bejudicially noticed.The Federal Register is published in paper, 24x microfiche formatand magnetic tape. The annual subscription price for the FederalRegister paper edition is $375, or $415 for a combined FederalRegister, Federal Register Index and List of CFR Sections Affected(LSA) subscription; the microfiche edition of the Federal Registerincluding the Federal Register Index and LSA Is $353; and magnetictape is $37,500. Six month subscriptions are available for one-halfthe annual rate. The charge for individual copies in paper form is$4.50 for each issue, or $4.50 for each group of pages as actuallybound; or $1.50 for each issue in microfiche form; or $175.00 permagnetic tape. All prices include regular domestic postage andhandling. International customers please add 25% for foreignhandling. Remit check or money order, made payable to theSuperintendent of Documents, or charge to your GPO DepositAccount, VISA or MasterCard. Mail to: New Orders, Superintendentof Documents. P.O. Box 371954, Pittsburgh, PA 15250-7954.There are no restrictions on the republication of material appearingin the Federal Register.How To Cite This Publication: Use the volume number and thepage number. Example: 58 FR 12345.

SUBSCRIPTIONS AND COPIES

PUBLICSubscriptions:

Paper or fiche 202-783-3238Magnetic tapes 512-1530Problems with public subscriptions 512-2303

Single copies/back copies:Paper or fiche 783-3238Magnetic tapes 512-1530Problems with public single copies 512-2457

FEDERAL AGENCIESSubscriptions:

Paper or fiche 523-5243Magnetic tapes 512-1530Problems with Federal agency subscriptions 523-5243'For other telephone numbers, see the Reader Aids sectionat the end of this Issue.

@ Printed on recycled paper containing 100% post consumer waste

HI

Contents Federal RegisterVol. 58, No. 236

Friday, December 10, 1993

Administrative Committee of the Federal RegisterSee Federal Register, Administrative Committee

Agriculture DepartmentSee Federal Crop Insurance Corporation

Blind or Severely Disabled, Committee for Purchase FromPeople Who Are

See Committee for Purchase From People Who Are Blind orSeverely Disabled

Children and Families AdministrationPROPOSED RULESFamily violence prevention and services programs;

requirements, 64920

Commerce DepartmentSee National Oceanic and Atmospheric Administration

Commission on Immigration ReformNOTICESMeetings; correction, 64969

Committee for Purchase From People Who Are Blind orSeverely Disabled

NOTICESProcurement list; additions and deletions, 64931, 64932

Defense DepartmentNOTICESAgency information collection activities under OMB

review, 64932Foreign military financing for direct commercial contracts

termination; effective date extension, 64932

Education DepartmentNOTICESAgency information collection activities under OMB

review, 64933* Grants and cooperative agreements; availability, etc.:

Fund for innovation in education-Comprehensive school health education program,

64933

Employment and Training AdministrationNOTICESMeetings:

Unemployment Compensation Advisory Council, 64969

Employment Standards AdministrationNOTICESMinimum wages for Federal and federally-assisted

construction; general wage determination decisions,64970

Energy DepartmentSee Energy Research OfficeSee Federal Energy Regulatory CommissionNOTICESGrant and cooperative agreement awards:

Council of State Governments, Midwestern Office, 64937

Grants and cooperative agreements; availability, etc.:Advanced fossil resource utilization research at

historically black colleges and universities, 64934

Energy Research OfficeNOTICESGrants and cooperative agreements; availability, etc.:* Computer hardware advanced mathematics and climate

physics program, 64937

Environmental Protection AgencyRULESAir programs:

Stratospheric ozone protection-Ozone-depleting substances; accelerated phase-out

schedule, 65018NOTICESEnvironmental statements; availability, etc.:

Agency statements-Comment availability, 64945Weekly receipts, 64945

Eagle Pass Mine, TX, 64945

Federal Aviation AdministrationRULESAirworthiness directives:

Airbus Industrie, 64876General Electric Co., 64874Lockheed, 64877

Class D airspace, 64879, 64880Class E airspace, 64879NOTICESAdvisory circulars; availability, etc.:

Aircraft-Flightcrew sleeping quarters/facilities, 65002

Federal Crop Insurance CorporationRULESAdministrative regulations:

Late planting agreement option; applicability to cropsinsured, 64872

Crop insurance regulations:Late planting agreement option and prevented planting

endorsement, 64873

Federal Emergency Management AgencyNOTICESDisaster and emergency areas:

Missouri, 64946Texas, 64946

Federal Energy Regulatory CommissionNOTICESElectric rate, small power production, and interlocking

directorate filings, etc.:Consolidated Edison Co. of New York, Inc., et al., 64938

Natural gas certificate filings:National Fuel Gas Supply Corp. et al., 64939

Applications, hearings, determinations, etc.:Algonquin Gas Transmission Co., 64940ANR Pipeline Co., 64940Black Marlin Pipeline Co., 64940

IV Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Contents

Colorado Interstate Gas Co., 64940Columbia Gas Transmission Corp., 64941Eastern Shore Natural Gas Co., 64941East Tennessee Natural Gas Co., 64941Kern River Gas Transmission Co., 64941K N Interstate Gas Transmission Co., 64942Midwestern Gas Transmission Co., 64942Mojave Pipeline Co., 64942Northwest Pipeline Corp., 64943Pacific Gas Transmission Co., 64943Tennessee Gas Pipeline Co., 64943Transcontinental Gas Pipe Line Corp., 64944West Texas Gas, Inc., 64944Williams Natural Gas Co., 64944

Federal Highway AdministrationRULESEngineering and traffic operations:

Design standards for highways-Geometric design metric values, 64895

Uniform Traffic Control Devices Manual-Work zone traffic control standards revision, 65084

PROPOSED RULESMotor carrier safety standards:

Inspection, repair, and maintenance-Rockwell disc brake; commercial motor vehicles;

petition reconsideration, 64923NOTICESEnvironmental statements; notice of intent:

Windham County, VT, 65008

Federal Maritime CommissionRULESMaritime carriers in foreign commerce:

Conditions unfavorable to shipping, actions to adjust ormeet-

United States/foreign trade, 64909NOTICESFreight forwarder licenses:

Ocean Freight Express et al., 64946Investigations, hearings, petitions, etc.:

Hoegh Lines et al., 64947

Federal Register, Administrative CommitteeRULESFederal Register publications price changes, 64871

Federal Reserve SystemNOTICESFederal Open Market Committee:

Domestic policy directives, 64947Meetings; Sunshine Act, 65016

Federal Trade CommissionRULESTire advertising and labeling guides; retreaded tires, 64881PROPOSED RULESAlternative fuels and alternative fueled vehicles; labeling

requirements, 64914NOTICESAgency information collection activities under OMB

review, 64948Prohibited trade practices:

Cooper Industries, Inc., 64950General Motors Corp. et al., 64950Gracewood Fruit Co.,64955Presto Food Products, Inc., 64955S.C. Johnson & Son, Inc., 64957

Fish and Wildlife ServiceRULESEndangered and threatened species:

Coastal California gnatcatcher, 65088PROPOSED RULESEndangered and threatened species:

Coastal California gnatcatcherSpecial rule; environmental statement availability,

65097Findings on petitions, etc., 64927Hine's emerald dragonfly, 64927

NOTICESEndangered and threatened species:

Recovery plans-Large-flowered fiddleneck, 64963

Food and Drug AdministrationRULESFood additives:

Adjuvants, production aids, and sanitizers-1,1 difluoroethane. 64894

Foreign Assets Control OfficeRULESUNITA (Angola) sanctions regulations:

National Emergency declaration and sanctions againstNational Union for Total Independence of Angola(UNITA), 64904

Health and Human Services DepartmentSee Children and Families AdministrationSee Food and Drug AdministrationSee National Institutes of HealthSee Social Security Administration

Housing and Urban Development DepartmentNOTICESGrants and cooperative agreements; availability, etc.:

Facilities to assist homeless-Excess and surplus Federal property, 64960

Immigration and Naturalization ServiceNOTICESImmigration user fee increase, 64969

Interior DepartmentSee Fish and Wildlife ServiceSee Land Management BureauSee Minerals Management ServiceSee National Park ServiceNOTICESMeetings:

Exxon Valdez Oil Spill Public Advisory Group, 64962

Internal Revenue ServiceRULESIncome taxes:

Mutual Life Insurance Company; differential earningsrate, etc., 64897

Interstate Commerce CommissionNOTICESMotor carriers:

Compensated intercorporate hauling operations, 64967Rail carriers:

Direct service orders-Decatur Junction Railway Co., 64967

Railroad services abandonment:Missouri Pacific Railroad Co., 64968

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Contents V

Justice DepartmentSee Immigration and Naturalization Service

Labor DepartmentSee Employment and Training AdministrationSee Employment Standards AdministrationSee Mine Safety and Health AdministrationSee Occupational Safety and Health AdministrationSee Pension and Welfare Benefits AdministrationNOTICESSenior Executive Service:

Performance Review Board; membership, 64969

Land Management BureauPROPOSED RULESCoal management:

Logical mining units; application procedures, approvalcriteria, diligence, and administration of operations,64919

NOTICESEnvironmental statements; availability, etc.:

Leslie Gulch Area, OR, 64962Realty actions; sales, leases, etc.:

California, 64962

Minerals Management ServiceRULESRoyalty management:

Oil surety requirements, reporting and recordkeepingrequirements, andaddresses, 64899

NOTICESOuter Continental Shelf operations:

Alaska OCS-Lease sales, 64964

Mine Safety and Health AdministrationNOTICES

'\Safety standard petitions:'Double "B" Mining, Inc., et al., 64971

National Archives and Records AdministrationPROPOSED RULESRecords management:

Agency program evaluations, 64915

National Highway Traffic Safety AdministrationNOTICESMotor vehicle safety standards:

Nonconforming vehicles-Importation eligibility; determinations, 65009, 65010,

. 65011Motor vehicle safety standards; exemption petitions, etc.:

Bugatti Automobili, S.p.A., 65008

National Institutes of HealthNOTICESMeetings:

Human Genome Research National Advisory Council,64959

National Institute on Deafness and Other CommunicationDisorders, 64959

Research Grants Division Behavioral and NeurosciencesSpecial Emphasis Panel, 64960

Patent licenses; non-exclusive, exclusive, or partiallyexclusive:

Conocurvone as antiviral agent useful in treatment ofacquired immunodeficiency syndrome (AIDS), 64960

-National Oceanic and Atmospheric AdministrationNOTICESEnvironmental statements; availability, etc.:

American lobster fishery, 64929

National Park ServiceNOTICESConcession contract negotiations:

Buffalo National River, AR, 64967

National Science FoundationNOTICESAntarctic Conservation Act of 1978; permit applications,

etc., 64986, 64987

Nuclear Regulatory CommissionNOTICESAgency information collection activities under OMB

review, 64987Environmental statements; availability, etc.:

Florida Power Corp., 64987Applications, hearings, determinations, etc.:

Florida Power Corp., 64989

Occupational Safety and Health AdministrationNOTICESNationally recognized testing laboratories, etc.:

Canadian Standards Association, 64973

Pension and Welfare Benefits AdministrationNOTICESEmployee benefit plains; prohibited transaction exemptions:Northern Trust Co. et al., 64973

Postal ServicePROPOSED RULESDomestic -Mail Manual:

Special bulk third-class eligibility restrictions, 64918

Public Health ServiceSee Food and Drug AdministrationSee National Institutes of Health

.Research and Special Programs AdministrationNOTICESPipeline safety:

Drug testing information; advisory bulletin to pipelineoperators and contractors, 65011

Securities and Exchange CommissionNOTICESSelf-regulatory organizations:

Clearing agency registration applications-MRS Clearing Corp., 64989

Self-regulatory organizations; proposed rule changes:MBS Clearing Corp., 64990Municipal Securities Rulemaking Board, 64992National Association of Securities Dealers, Inc., 64990,

64.994Options Clearing Corp. et al., 64997

Self-regulatory organizations; unlisted trading privileges:Chicago Stock Exchange, Inc., 64998Philadelphia Stock Exchange, Inc., 64992

Applications, hearings, determinations, etc.:Public utility holding company filings, 64999

VI Federal Register / Vol. 58, No. 236 /.Friday, December 10, 1993 / Contents

Social Security AdministrationRULESSocial security benefits:

Dependents; suspension of benefits when worker is inextended period of eligibility. 64882

Spouse deemed and legal; continued entitlement tobenefits; treatments of divorce in invalid marriageand multiple entitlements under family maximum.°64890

Suspension of benefits if individual is deported;exemption from social security because of religiousbeliefs, 64886

Social security benefits and supplemental security income:Claimants for benefits; representation, 64883

Supplemental security income:Eligibility redeterminations, 64892Institutional care maximum payment limit. 64893

State DepartmentNOTICESArms Export Control Act; determinations, 65001

Transportation DepartmentSee Federal Aviation AdministrationSee Federal Highway AdministrationSee National Highway Traffic Safety AdministrationSee Research and Special Programs AdministrationNOTICESAviation proceedings:

Agreements filed; weekly receipts, 65001Certificates of public convenience and necessity and

foreign air carrier permits; weekly applications,65002

Treasury DepartmentSee Foreign Assets Control Office

See Internal Revenue Service

United States Information AgencyNOTICESGrants and cooperative agreements; availability, etc.:

International educational and cultural activitiesdiscretionary program, 65012

Separate Parts In This Issue

Part IIEnvironmental Protection Agency. 65018

Part IIIDepartment of Transportation, Federal Highway

Administration, 65084

Part IVDepartment of the Interior, Fish and Wildlife Service.

65088

Reader AidsAdditional information, including a list of public laws,telephone numbers, and finding aids, appears in the ReaderAids section at the end of this issue.

Electronic Bulletin BoardFree Electronic Bulletin Board service for Public Lawnumbers and Federal Register finding aids is available on202-275-1538 or 275-0920.

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Contents VII

CFR PARTS AFFECTED IN THIS ISSUE

A cumulative list of the parts affected this month can be found In theReader Aids section at the end of this issue.

1 CFR11 ..................................... 648717 CFR400 ................................... 64872401 ................................... 6487314 CFR39 (3 documents) ........... 64874,

64875,6487771 (3 documents) ........... 64879,

6488016 CFR228 .................................. 64881Proposed Rules:309 ................................... 6491420 CFR404 (4 documents) ......... 64882,

64883,64886,64890416 (3 documents) ......... 64883,

64892,6489321 CFR178 ................................... 6489423 CFR625 ................................... 64895655 ................................... 6508426 CFR1..o ................................ 6489730 CFR207 ................................... 64899208 ................................... 64899210 ................................... 64899216 ................................... 64899218 ............... 64899219 ................................... 64899220 ................................... 64899228 ................................... 64899229 ................................... 64899243 ................................... 6489931 CFR590 ................................... 6490436 CFRProposed Rules:1220 ................................. 6491539 CFRProposed Rules:.111 ................................... 6491840 CFR82 ..................................... 6501843 CFRProposed Rules:Group 3400 ...................... 6491945 CFRProposed Rules:1370 ................................. 6492046 CFR585 ................................... 6490949 CFRProposed Rules:396 ................................... 6492350 CFR17 ..................................... 65088Proposed Rules:17 (3 documents) ........... 64927,

65097

64871

Rules and Regulations Federal Register.

Vol. 58, No. 236


This section of the FEDERAL REGISTERcontains regulatory documents having generalapplicability and legal effect, most of whichare keyed to and codified In the Code ofFederal Regulations, which Is published under50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations Is sold bythe Superintendent of Documents. Prices ofnew books are listed In the first FEDERALREGISTER Issue of each week.

ADMINISTRATIVE COMMITTEE OF

THE FEDERAL REGISTER

1 CFR Part 11

Price Changes to Federal RegisterPublications

AGENCY: Administrative Committee ofthe Federal Register (ACFR).ACTION: Final rule with request forcomments.

SUMMARY: The AdministrativeCommittee of the Federal Register(ACFR) announces increases in theprices of Federal Register publications.The price changes apply to annualsubscription rates for the daily FederalRegister, the Code of FederalRegulations (CFR), the WeeklyCompilation of Presidential Documents,the Federal Register Index and LSA (Listof CFR Sections Affected), as well as tothe single issue price of the dailyFederal Register. These price changesare necessary to more accurately reflectthe Government's cost of productionand distribution of these publications.DATES: The changes to I CFR 11.2(Federal Register), 1 CFR 11.4 (TheUnited States Government Manual), 1CFR 11.6 (Weekly Compilation ofPresidential Documents), 1 CFR 11.7(Federal Register Index), and I CFR 11.8(LSA) are effective on January 10, 1994.The changes to 1 CFR 11.3 (CFR) areeffective January 1, 1994. Commentswill be accepted until January 1, 1994.ADDRESSES: By U.S. Mail: Office of theFederal Register, National Archives andRecords Administration, Washington,DC 20408. By private delivery services:Office of the Federal Register, 800 NorthCapitol Street, NW., suite 700,Washington, DC 20002. By telefax: 202-523-6866. By electronic mail on FREND(Federal Register Electronic NewsDelivery service): 202-275-1538 or 202-275-0920.

FOR FURTHER INFORMATION CONTACT:Michael White at 202-523-4534.SUPPLEMENTARY INFORMATION: TheAdministrative Committee of theFederal Register, which establishesprices for Federal Register publications,has recently determined that priceadjustments to certain subscriptions andsingle issues are necessary to operate ona sound fiscal basis.

On September 1, 1992, theAdministrative Committee published afinal rule announcing the results of areview of its pricing policies, 57 FR40024 (September 1, 1992). TheAdministrative Committee ascertainedthat price changes were necessary tomova toward full recovery of increasedcosts attributable to printing and labor,expenses at the Government PrintingOffice plant and prior postal rateincreases. Because prices had not beenraised for several years, and to minimizethe effect that large price increasesmight have on Federal Registercustomers, the AdministrativeCommittee announced in the September1, 1992 final rule that it intended toadjust prices gradually over a period ofseveral years, reviewing cost figuresannually to determine the rate ofincrease. The Committee also solicitedcomments from the public on thepricing structure of Federal Registerpublications. No comments werereceived.

After reviewing the GovernmentPrinting Office's most current analysisof its production and distribution costs,the Administrative Committee hasdetermined that it is necessary to makefurther incremental increases in theprices of the paper editions of FederalRegister publications. The microficheeditions of the Federal Register and theCFR are subject to a competitive biddingprocess that determines the pricescharged. Those price charlges are alsoincluded in this final rule. TheAdministrative Committee welcomescomments on Federal Registerpublications and prices.

The following rates are effective as ofJanuary 10, 1994. The annualsubscription rates for the FederalRegister paper edition will be $444, or$490 for a combined Federal Register,Federal Register Index and LSA (List ofCFR Sections Affected) subscription.

The annual subscription price of themicrofiche edition of the FederalRegister including the Federal Register

Index and LSA will be $403. The pricefor single copies of the paper edition ofthe daily Federal Register will be $6.The annual subscription price for theFederal Register Index will be $22. Theannual subscription price for the LSAwill be $24. Individual copies of theFederal Register Index and the LSA areno longer available. The annualsubscription rates for the WeeklyCompilation of Presidential Documentswill be $65 by non-priority mail, or$103 by first-class mail.

As of January 1, 1994, the annualsubscription rates for the Code ofFederal Regulations will be $829 for thepaper edition and $244 for themicrofiche edition.

In this rule, the AdministrativeCommittee has also revised 1 CFR 11.2,11.3, and 11.4 to remove sales ofmagnetic tape editions of the FederalRegister, CFR and The United StatesGovernment Manual from theregulations. The Committee believesthat responsibility for distribution ofthis material belongs with theSuperintendent of Documents under theauthority of 44 U.S.C. chapter 17.Pursuant to the Government PrintingOffice Electronic Information AccessEnhancement Act of 1993, theAdministrative Committee is developinga prototype for an official online editionof the Federal Register scheduled forgeneral dissemination in the spring of1994. Further steps are underway toconvert the CFR data base into anaccessible electronic format. TheAdministrative Committee has alreadyauthorized an electronic pilot project forThe United States Government Manual,which is currently available to thepublic over GPO's Federal BulletinBoard.

The Administrative Committee hasnot published a notice of proposedrulemaking on the revised priceschedule, as permitted by 5 U.S.C.553(b)(B) when there is good cause notto publish a proposed rule and obtaincomments from interested persons. TheAdministrative Committee hasdetermined that publication of aproposed rule is unnecessary. TheAdministrative Committee has authorityunder 44 U.S.C. 1506 to set the pricesto be charged for Federal Registersubscriptions and individual copies. Tothe extent possible, the AdministrativeCommittee sets prices to recover onlythe actual cost of producing and

64872 Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations

distributing Federal Registerpublications. The revised prices arebased on an in-depth cost studyconducted for the AdministrativeCommittee by the Government PrintingOffice. Because only actual costs wereconsidered in setting the revised priceschedule based on an in-depth coststudy, the Administrative Committeehas determined that there is good causefor promulgating this final rule withouta prior notice of proposed rulemaking.

This regulatory action has beenreviewed by the Office of Managementand Budget, Office of Information andRegulatory Affairs, under ExecutiveOrder 12866. The Regulatory FlexibilityAct (5 U.S.C. 601 et seq.) does not applyto rate increases necessary to recover thecosts to the Government of printing anddistributing these publications.

List of Subjects in I CFR Part 11

Federal Register publications,Government publications, Organizationand functions (Government agencies),Subscription rates.

For the reasons discussed in thepreamble, the AdministrativeCommittee of the Federal Registeramends part 11 of chapter I of title I ofthe Code of Federal Regulations as setforth below:

PART 11--SUBSCRIPTIONS

1. The authority citation for part 11continues to read as follows:

Authority: 44 U.S.C. 1506; sec. 6, E.O,10530, 19 FR. 2709, 3 CFR, 1954-1958 Comp.,p. 189.

2. Section 11.2 Is revised to read asfollows:

§ 11.2 Federal Register.Daily issues are furnished by mail to

subscribers for $444 per year in paperform. A combined subscription.consisting of the daily issues, themonthly Federal Register Index, and theLSA (List of CFR Sections Affected) isfurnished by mail to subscribers for$490 per year in paper form or $403 peryear in microfiche form. Six monthsubscriptions to all editions are alsoavailable at one-half the annual rate.Limited queptities of current or recentissues may be obtained for $6 per copyin paper form or $1.50 per copy inmicrofiche form.

3. Section 11.3 is revised to read asfollows:

§11.3 Code of Federal Regulations.A complete set is furnished by mail to'

subscribers for $829 per year for thebound, paper edition: $244 per year forthe microfiche edition. Individual "volumes of the bound, paper edition of

the Code are sold at prices determinedby the Superintendent of Documentsunder the general direction of theAdministrative Committee. The price ofan individual volume in microficheform is $2.00 per copy.9 11.4 [Amended]

4. Section 11.4 is amended byremoving the last sentence.

5. Section 11.6 is revised to read asfollows:§11.6 Weekly Compilation of PresidentialDocuments.

Copies in paper form are furnished tosubscribers for $65 per year by non-priority mail or*$103 per year by first-class mail. The price of an individualcopy in paper form is $2..

6. Section 11.7 is revised to read asfollows:5 11.7 Federal Register Index.

The annual subscription price for themonthly Federal Register Index,purchased separately, in paper form, is$22.

7. Section 11.8 is revised to read asfollows:§11.8 LSA (List of CFR Sections Affected).

The annual subscription price for themonthly LSA (List of CFR SectionsAffected), purchased separately, inpaper form, is $24.Trudy Huskamp Peterson,Chairman.Michael F. DiMaiio.Member.Rosemary Hart.Member.Janet Reno,Attorney General.Trudy Huskamp Peterson,Acting Archivist of the United States.[FR Doc. 93-30174 Filed 12-9-93; 8:45 am)BILLNG CODE 1505.-"-

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 400

General Administrative RegulationsAGENCY: Federal Crop InsuranceCorporation, USDA.ACTION: Final rule.

SUMMARY: The Federal Crop InsuranceCorporation (FCIC) hereby amendssubpart A in its General AdministrativeRegulations. Subpart A definesprovisions for a Late PlantingAgreement Option and sets out cropinsurance regulations applicable to theOption. However, some crop insuranceregulations set out in this subpart have

been reformed as endorsements under 7CFR 401 with their own late plantingagreement option at 7 CFR 401.107.EFFECTIVE DATE: December 10, 1993.FOR FURTHER INFORMATION CONTACT:Mari L. Dunleavy, Regulatory Specialist,Federal Crop Insurance Corporation,U.S. Department of Agriculture,Washington, DC 20250. Telephone:202-254-8314.

SUPPLEMENTARY INFORMATION: Thisaction has been reviewed under USDAprocedures established by ExecutiveOrder 12291 and DepartmentalRegulation 1512-1. This actionconstitutes a review as to the need,currency, clarity and effectiveness ofthese regulations under thoseprocedures. The sunset review dateestablished for these regulations isOctober 1, 1998.

Kathleen Connelly, Acting Manager,FCIC has determined that this action isnot a major rule as defined by ExecutiveOrder 12291 because it will not resultin: (a) An annual effect on the economyof $100 million or more; (b) majorincreases in costs or prices forconsumers, individual industries,Federal, State, or local governments, ora geographical region; or (c) significantadverse effects on competition,employment, investment, productivity,innovation, or the ability of UnitedStates-based enterprises to competewith foreign-based enterprises indomestic or export markets. The ActingManager certifies that this action willnot increase the Federal paperworkburden for individuals, smallbusinesses, and other persons, nor willit have a significant economic effect ona substantial number of small entities.This action imposes no additional,burden to the insured farmer. Further,this action requires of the reinsuredcompany or sales and service contractorwhat is considered normal in theordinary conduct of business. This ruledoes not require any action on the partof any individual or entity incompliance with the programprovisions. This action is determined tobe exempt from the provisions of theRegulatory Flexibility Act and noRegulatory Flexibility Analysis wasprepared.

This program is listed in the Catalogof Federal Domestic Assistance underNo. 10.450.

This program is not subject to theprovisions of Executive Order 12372which requires intergovernmentalconsultation with state and localofficials., See the Notice related to 7 CFRpart 3015, subpart V, published at 48 FR29115, June 24, 1983.

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations 64873

This action is not expected to haveany significant impact on the quality ofthe human environment, health, andsafety. Therefore, neither anEnvironmental Assessment nor anEnvironmental Impact Statement isneeded.

The Acting Manager, FCIC, hascertified to the Office of Managementand Budget (OMB) that these regulationsmeet the applicable standards providedin sections 2(a) and 2(b)(2) of ExecutiveOrder 12778.

This rule has been reviewed inaccordance with Executive Order 12778.The provisions of this proposed rule arenot retroactive and will preempt stateand local laws to the extent such stateand local laws are inconsistentherewith. The administrative appealprovisions located at 7 CFR part 400,subpart J must be exhausted beforejudicial action may be brought forjudicial review of actions taken underthe subpart and for the imposition ofcivil penalties under the Program FraudCivil Remedies Act.

This amendment does not containinformation collection that requireclearance by the Office of Managementand Budget under the provisions of 44U.S.C. chapter 35, the PaperworkReduction Act.

The Office of General Counsel, as theDesignated Official under section 6(a) ofExecutive Order 12612, Federalism, hasdetermined that the policies andprocedures contained in this rule willnot have substantial direct effects onstates or their political subdivisions, oron the distribution of power andresponsibilities among the variouslevels of government.

This amendment is beingpromulgated to update FCIC'sregulations, and make corrections toattributions contained in the subpart.Because this action has no effect on thepublic or the insureds that the Federalcrop insurance program serves goodcause is found to make this rule finalupon publication. This rule is notsubstantive, notice and publicprocedure on this rule is determined tobe impracticable and unnecessary.

List of Subjects in 7 CFR Part 400,Subpart A

Crop insurance, Crops.

Final Rule

PART 400-GENERALADMINISTRATIVE REGULATIONS


Authority: 7 U.S.C. 1506 and 1516.

Subpart A-Late Planting Agreement,Option; Regulations for the 1987 andSucceeding Crop Years


§ 400.4 Applicability to crops Insured.The provisions of this subpart shall be

applicable to the provisions of FCICpolicies issued under the followingregulations for insuring crops:7 CFR part 416 Pea7 CFR part 422 Potatoes7 CFR part 425 Peanuts7 CFR part 430 Sugar Beets7 CFR part 433 Dry Beans7 CFR part 435 Tobacco (Quota Plan)7 CFR part 437 Sweet Corn (Canning

and Freezing) •Done in Waslhington, DC, on September 21,

1993.Bob Nash,Under Secretary, Small Community and RuralDevelopment.IFR Doc. 93-30006 Filed 12-9-93; 8:45 am)BILUNO CODE 3410-"6-M

7 CFR Part 401

General Crop Insurance Regulations -

AGENCY: Federal Crop InsuranceCorporation, USDA.ACTION: Final rule.

SUMMARY: The Federal Crop InsuranceCorporation (FCIC) hereby amends theLate Planting Option and the PreventedPlanting Endorsement regulations.Certain crop endorsements which hadlate and prevented planting coverageoffered as an option now have late andprevented planting coverageincorporated into those cropendorsements. To eliminate confusionto the purchaser, those cropendorsements which have late andprevented planting coverage.incorporated into crop endorsements arehereby removed from the applicablesections of the regulations.EFFECTIVE DATE: December 10, 1993.FOR FURTHER INFORMATION CONTACT: MariL. Dunleavy, Regulatory Specialist,Federal Crop Insurance Corporation,U.S. Department of Agriculture,Washington, DC 20250. Telephone:202-254-8314.SUPPLEMENTARY INFORMATION: Thesunset review date established for thisregulation is April 1, 1992. Within twoyears, FCIC will remove §§ 401.107 and401.108 which are covered by this rule.Therefore, a review is unnecessaryunderDepartmental Regulation 1512-1and Executive Order 12291.

Kathleen Connelly, Acting Manager,FCIC, has determined that this action isnot a major rule as defined by ExecutiveOrder 12291 because it will not resultin: (a) An annual effect on the economyof $100 million or more; (b) majorincreases in costs or prices forconsumers, individual industries,Federal, State or local governments, ora geographical region; or (c) significantadverse effects on competition,employment, investment, productivity,innovation, or the ability of UnitedStates-based enterprises to competewith foreign-based enterprises indomestic or export markets. The ActingManager certifies that this action willdecrease the federal paperwork burdenfor individuals, small businesses, andother persons because late andpreventedplanting options, whichrequire added paper work, will beeliminated. Therefore, this action isdetermined to be exempt from theprovisions of the Regulatory FlexibilityAct and no Regulatory FlexibilityAnalysis was prepared.

This program is listed in the Catalogof Federal Domestic Assistance underNo. 10.450.

This program is not subject to theprovisions of Executive Order 12372which requires intergovernmentalconsultation with state and localofficials. See the Notice. related to 7 CFRpart 3015, subpart V, published at 48 FR29115, June 24, 1983.

This action is not expected to haveany significant impact on the quality ofthe human environment, health, andsafety. Therefore, neither anEnvironmental Assessment nor anEnvironmental Impact Statement isneeded.. The Acting Manager, FCIC, has

certified to the Office of Managementand Budget (OMB) that these regulationsmeet the applicable standards providedin sections 2(a) and 2(b)(2) of ExecutiveOrder 12778.

This rule has been reviewed inaccordance with Executive Order 12778.The provisions of this proposed rule arenot retroactive and will preempt stateand local laws to the extent such stateand local laws are inconsistentherewith. The administrative appealprovisions located at 7 CFR part 400,subpart J and 7 CFR part 1, §§ 1.12 and1.13 must be exhausted before judicialaction may be brought for actions takenunder proceedings for the imposition ofcivil penalties or under the ProgramFraud Civil Remedies sections of theseregulations.

This amendment does not containinformation collections that requireclearance by the Office of Managementand Budget under the provisions of 44


U.S.C. chapter 35, the PaperworkReduction Act.

The Office of General Counsel, as theDesignated Official under section 6(a) ofExecutive Order 12612, Federalism, hasdetermined that the policies andprocedures contained in this rule willnot have substantial direct effects onstates or their political subdivisions, oron the distribution of power andresponsibilities among the variouslevels of government.

As this amendment is beingpromulgated only to update FCIC'sregulations, and has no effect on thepublic or the insureds that the Federalcrop insurance program serves, goodcause is found to make this rule finalupon publication. Because this rule isnot substantive, notice and publicprocedure on this rule is determined tobe impracticable and unnecessary.

List of Subjects in 7 CFR Part 401Crop insurance, Grains.

Final RuleFor reasons set forth in the preamble,

7 CFR Ch. IV is amended as follows:

PART 401-GENERAL CROPINSURANCE REGULATIONS


Authority- 7 U.S.C. 1506 and 1516.

3. Section 401.108(b) is amended byrevising paragraph g. of provision 11 ofthe "Prevented Planting Endorsement"to read as follows:

§ 401.108 Prevented planted endorsement.(b)* * *

Prevented Planting Endorsement

11. Meaning of Terms * *

(g) Qualifying Crop means barley.oats, or wheat.

Done in Washington, DC on September 22,1993.Bob Nash,Under Secretary, Small Community and RuralDevelopment, Chairman of the Board, FCC.[FR Doc. 93-30007 Filed 12-9-93; 8:45 amlBILUNG CODE 3410-O6-M

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39[Docket No. 92-ANE-09; Amendment 39-8739; AD 93-23-051

Airworthiness Directives; GeneralElectric Aircraft Engines Model(s)CT7-6A2 and -7A Turboprop Engines

2. Section 401.107 is amended by AGENCY: Federal Aviationrevising paragraph (e) to read as follows: Administration, DOT.

AtflIONd PinnI rnl_S401.107 Late planting agreement option.

r *t *t * *

(e) Applicability to crops insured. Theprovisions of this section will beapplicable to the provisions for insuringcrops for the 1994 crop year only, underthe following endorsements:

401.101 Wheat Endorsement.401.103 Barley Endorsement.401.105 Oat Endorsement.

The provisions of this section forinsuring crops for the 1994 andsubsequent crop years will be applicableonly under the following endorsements:

401.106 Rye Endorsement.401.114 Canning and Processing Tomato

Endorsement.401.116 Flaxseed Endorsement.401.118 Canning and Processing BeanEndorsement

401.123 Safflower Seed Endorsement.401.124 Sunflower Seed Endorsement.401.126 Onion Endorsement.

The Late Planning Agreement Optionwill be available in all counties inwhich the Corporation offers insuranceon these crops unless limited by theactuarial table, crop endorsement, orcrop endorsement option.* * * * *t

SUMMARY: This amendment adopts anew airworthiness directive (AD).applicable to General Electric (GE)Aircraft Engines Model(s) CT7-5A2 and-7A turboprop engines that requiresinspection and replacement, ifnecessary, of certain gas generatorturbine (GGT) rotor assembly parts, andStage 3 and Stage 4 power turbine (PT)disks that may have been shotpeenedduring overhaul. This amendment isprompted by reports of inadvertentshotpeening of GGT rotor assemblyparts and Stage 3 and 4 PT disks duringoverhaul. The actions specified by thisAD are intended to prevent fatiguecracks that can lead to an uncontainedengine failure.DATES: Effective January 10, 1994.

The incorporation by reference ofcertain publications listed in theregulations is approved by the Directorof the Federal Register as of January 10,1994.ADDRESSES: The service informationreferenced in this AD may be obtainedfrom General Electric Aircraft Engines.1000 Western Avenue, Lynn. MA 01910.This information may be examined at

the FAA, New England Region, Office ofthe Assistant Chief Counsel, Attn: RulesDocket No. 92-ANE-09, 12 NewEngland Executive Park, Burlington,MA; or at the Office of the FederalRegister, 800 North Capitol Street, NW.,suite 700, Washington, DC.FOR FURTHER INFORMATION CONTACT:Barbara G. Caufield. AerospaceEngineer, Engine Certification Branch.ANE-141, Engine Certification Office,Engine and Propeller Directorate,Aircraft Certification Service, FAA. NewEngland Region. 12 New EnglandExecutive Park, Burlington, MA 01803-5299; telephone no. (617) 238-7146; fax.(617) 238-7199.SUPPLEMENTARY INFORMATION: Aproposal to amend part 39 of the FederalAviation Regulations to include anairworthiness directive (AD) that isapplicable to GE Aircraft EnginesModel(s) CT7-5A2 and -7A turbopropengines was published in the FederalRegister on November 30, 1992 (57 FR56529). That action proposed to requireinspection and replacement, ifnecessary. of certain gas generatorturbine (GGT) rotor assembly parts, andStage 3 and Stage 4 power turbine (PT)disks that may have been shotpeenedduring overhaul.

Interested persons have been affordedan opportunity to participate in themaking of this amendment. Dueconsideration has been given to thecomments received.

One commenter supports the rule asproposed.

One commenter observes that theeconomic analysis in the proposed ADstates that there are 30 engines of theaffected design in the worldwide fleet,when, in fact, there are only 23 engines.The FAA concurs. The wording of theeconomic analysis for the final rule hasbeen changed accordingly. The FAA'sestimate of the total cost of compliancewith the AD. however, remains the samebecause there are currently no enginesinstalled on aircraft of U.S. registry.

After careful review of the availabledata, including the comments notedabove, the FAA has determined that airsafety and the public interest require theadoption of the rule as proposed.

There are approximately 23 engines ofthe affected design in the worldwidefleet. The manufacturer has advised theFAA that there are currently no enginesinstalled on aircraft of U.S. registry.However, if an engine were to becomeinstalled on an aircraft of U.S. registry,it would take approximately 12 workhours per engine to remove and replacethe GGT rotor assembly parts and Stage3 and Stage 4 PT disks. GE has advisedthe FAA that H & S Aviation will


inspect for shotpeening and providenew or serviceable parts and disks, ifnecessary, at no charge to the operator.The average labor rate is $55 per workhour. At this time the total cost impactof the AD is estimated to be zero;however, if an engine were to becomeinstalled on an aircraft of U.S. registry,the estimated cost for removal andreplacement is approximately $660 perengine.

The regulations adopted herein willnot have substantial direct effects on theStates, on the relationship between thenational government and the States, oron the distribution of power andresponsibilities among the variouslevels of government. Therefore, inaccordance with Executive Order 12612,it is determined that this final rule doesnot have sufficient federalismimplications to warrant the preparationof a Federalism Assessment.

For the reasons discussed above, Icertify that this action (1) is not a"significant regulatory action" under

4Executive Order 12866; (2) is not a"significant rule" under DOTRegulatory Policies and Procedures (44FR 11034. February 26, 1979); and (3)will not have a significant economicimpact, positive or negative, on asubstantial number of small entitiesunder the criteria of the RegulatoryFlexibility Act. A final evaluation hasbeen prepared for this action and it iscontained in the Rules Docket. A copyof it may be obtained from the Rules

Docket at the location provided underthe caption ADDRESSES.

List of Subjects in 14 CFR Part 39

Air transportation, Aircraft, Aviationsafety, Incorporation by reference,Safety.

Adoption of the Amendment

Accordingly, pursuant to theauthority delegated to me by theAdministrator, the Federal AviationAdministration amends 14 CFR part 39of the Federal Aviation Regulations asfollows:

PART 39-AIRWORTHINESSDIRECTIVES


Authority: 49 U.S.C. App. 1354(a), 1421and 1423; 49 U.S.C. 106(g); and 14 CFR11.89.

§39.13 (Amended)2. Section 39.13 is amended by

adding the following new airworthinessdirective:93-23-05. General Electric Aircraft Engine.:

Amendment 39-8739. Docket No. 92-ANE-Og.

Applicability: General Electric (GE)Aircraft Engines Model(s) CT7-5A2 and -7Aturboprop engines, Incorporating gasgenerator turbine (GGT) rotor assembly partsand power turbine (PT) disks, as listed byserial number in GE CT7 Turboprop ServiceBulletin (SB) A72-228, Revision 2, and GECT7 Turboprop SB A72-229, Revision 2,both dated February 7, 1991, installed on, but

not limited to, Saab 340A and Casa CN235-10 aircraft.

Compliance: Required as indicated, unlessaccomplished previously.

To prevent fatigue cracks that can lead toan uncontained engine failure, accomplishthe following:

(a) Inspect GGT rotor Stage I forwardcooling plates, Stage I aft cooling plates,Stage I disks, Stage 2 forward cooling plates,Stage 2 aft cooling plates, and Stage 2 disks,in accordance with GE CT7 Turboprop SBA72-228, Revision 2, dated February 7, 1991,before exceeding the "max total cycles priorto inspect" limits listed in Tables I and 2 ofthe SB, but not later than December 31, 1995.

(1) If evidence of shotpeening is found onany of these parts, prior to further flight,replace the affected parts with serviceableparts.

(2) If no evidence of shotpeening is found,prior to further flight, mark the parts with theSB number, in accordance with GE CT7Turboprop SB A72-228, Revision 2, datedFebruary 7, 1991, and return to servicewithout reducing low cycle fatigue limits.

( (b) Inspect Stage 3 and Stage 4 PT disks,in accordance with GE CT7 Turboprop SBA72-229, Revision 2. dated February 7, 1991,prior to exceeding the "max total cycles priorto inspect" limits listed in Table I of the SB,but not later than December 31, 1995.

!1) If evidence of shotpeening is found.prior to further flight, replace the affecteddisks with serviceable disks.

(2) If no evidence of shotpeening is found,prior to further flight, mark the disks with theSB number, in accordance with GE CT7Turboprop SB A72-229. Revision 2, datedFebruary 7, 1991, and return to servicewithout reducing low cycle fatigue limits.

(c) The Inspections, markings, and repairsshall be done In accordance with thefollowing service bulletins:

Document No. Page No. Issue Date

GE c7 Turboprop SB ........................................................ 1-4 & 6 Revision ....... Feb. 7. 1991.A72-228 .................................. 5 & 7-12 Original ........ Jan. 30, 1990.

Total pages: 12GE CT7 Turboprop SB ....................................................... 1--3 Revision 2 ... Feb. 7, 1991.A72-229 ............................................................................. 4-7 Original ........ Jai. 30,1990.

Total pages: 7

This incorporation by reference wasapproved by the Director of the FederalRegister, in accordance with 5 U.S.C. 552(a)and 1 CFR part 51. Copies may be obtainedfrom General Electric Aircraft Engines, 1000Western Avenue, Lynn, MA 01910. Copiesmay be Inspected at the FAA, New EnglandRegion, Office of the Assistant Chief Counsel.Attn: Rules Docket No. 92-ANE-09.12 NewEngland Executive Park. Burlington, MA: orat the Office of the Federal Register, 800North Capitol Street, NW., suite 700.Washington. DC.

(d) An alternative method of compliance oradjustment of the compliance time thatprovides an acceptable level of safety may beused if approved by the Manager, EngineCertification Office. The request should beforwarded through an appropriate FAAPrincipal Maintenance Inspector, who may

add comments and then send it to theManager, Engine Certification Office.

Note- Information concerning the existenceof approved alternative methods ofcompliance with this airworthiness directive,.if any, may be obtained from the EngineCertification Office.

(e) Special flight permits may be issued, inaccordance with FAR 21.197 and 21.199, tooperate the aircraft to a location where therequirements of this AD can beaccomplished.

(f) This amendment becomes effective onJanudry 10, 1994.

Issued in Burlington. Massachusetts, onNovember 17, 1993.Mark C. Fulmer,Acting Manager. Engine and PropellerDirectorate, Aircraft Certification Service.[FR Doc. 93-28953 Filed 12-9-93; 8:45 am]BILUNG CODE 4910-13-P

14 CFR Part 39

[Docket No. 93-NM-26-AD; Amendment39-8760; AD 93-24-11]

Airworthiness Directives; AlrbusIndustrle Model A320 Series Airplanes

AGENCY: Federal AviationAdministration, DOT.


ACTION: Final rule.

SUMMARY: This amendment adopts anew airworthiness directive (AD),applicable to certain Airbus IndustrieModel A320 series airplanes, thatrequires modification of the belly fairingstructure. This amendment is promptedby results of fatigue testing, whichrevealed that rivet heads were shearedoff and fatigue cracks were present inthe angles at the angle attachmentbetween the keelbeam and the bellyfairing support frames. The actionsspecified by this AD are intended toprevent reduced structural integrity ofthe belly fairing structure.DATES: Effective January 10, 1994.

The incorporation by reference ofcertain publications listed in theregulations is approved by the Directorof the Federal Register as of January 10,1994.ADDRESSES: The service informationreferenced in this AD may be obtainedfrom Airbus Industrie, I Rond PointMaurice Bellonte, 31707 Blagnac Cedex,France. This information may beexamined at the Federal AviationAdministration (FAA), TransportAirplane Directorate, Rules Docket,1601 Lind Avenue, SW., Renton,Washington; or at the Office of theFederal Register, 800 North CapitolStreet, NW., suite 700, Washington, DC.FOR FURTHER INFORMATION CONTACT:Stephen Slotte, Aerospace Engineer,Standardization Branch, ANM-113,FAA, Transport Airplane Directorate,1601 Lind Avenue, SW., Renton,Washington 98055-4056; telephone(206) 227-2797; fax (206) 227-1320.SUPPLEMENTARY INFORMATION: Aproposal to amend part 39 of the FederalAviation Regulations to include anairworthiness directive (AD) that isapplicable to certain Airbus IndustrieModel A320 series airplanes waspublished in the Federal Register onAugust 19, 1993 (58 FR 44149). Thataction proposed to require modificationof the belly fairing structure.

Interested persons have been affordedan opportunity to participate in themaking of this amendment. Dueconsideration has been given to the fourcomments received.

All of the commenters support theproposed rule.


The FAA estimates that 20 airplanesof U.S. registry will be affected by thisAD, that it will take approximately 288work hours per airplane to accomplish

the required actions, and that theaverage labor rate is $55 per work hour.Required parts will cost approximately$1,045 per airplane. Based on thesefigures, the total cost impact of the ADon U.S. operators is estimated to be$337,700, or $16,885 per airplane. Thistotal cost figure assumes that nooperator has yet accomplished therequirements of this AD.


For the reasons discussed above, Icertify that this action (1) is not a"significant regulatory action" underExecutive Order 12866; (2) is not a"significant rule" under DOTRegulatory Policies and Procedures (44FR 11034, February 26, 1979); and (3)will not have a significant economicimpact, positive or negative, on asubstantial number of small entitiesunder the criteria of the RegulatoryFlexibility Act. A final evaluation hasbeen prepared for this action and it iscontained in the Rules Docket. A copyof it may be obtained from the RulesDocket at the location provided under.the caption ADDRESSES.







Authority: 49 U.S.C. App. 1354(a), 1421and 1423; 49 U.S.C. 106(g); and 14 CFR11.89.

§39.13 [Amended]2. Section 39.13 is amended by

adding the following new airworthinessdirective:93-24-11 Airbus Industrie: Amendment 39-

8760. Docket 93-NM-26-AD.

Applicability: Model A320 series airplanes;MSN 003 through 092 inclusive; certificatedin any category.


To prevent reduced structural integrity ofthe belly fairing structure, accomplish thefollowing:

(a) Prior to the accumulation of 12,000 totallandings after the effective date of this AD,or within 300 days after the effective date ofthis AD, whichever occurs later, modify thebelly fairing structure in accordance withAirbus Industrie Service Bulletin A320-53-1014, dated June 25, 1992, or Revision 1,dated May 26, 1993.

(b) An alternative method of compliance oradjustment of the compliance time thatprovides an acceptable level of safety may beused if approved by the Manager,Standardization Branch, ANM-113, FAA,Transport Airplane Directorate. Operatorsshall submit their requests through anappropriate FAA Principal MaintenanceInspector, who may add comments and thensend it to the Manager, StandardizationBranch, ANM-113.

Note: Information concerning the existenceof approved alternative methods ofcompliance with this AD, if any, may beobtained from the Standardization Branch,ANM-113.

(c) Special flight permits may be issued inaccordance with FAR 21.197 and 21.199 tooperate the airplane to a location where therequirements of this AD can beaccomplished.

(d) The modification shall be done inaccordance with Airbus Industrie ServiceBulletin A320-53-1014, dated June 25, 1992,or Airbus Industrie Service Bulletin A320--53-1014, Revision 1, dated May 26, 1993.Revision I of Airbus Industrie ServiceBulletin A320-53-1014 contains thefollowing list of effective pages:

Revision Date shown on

Page No. level shown pageon page

1-7, 7A, 8, 1 ................. May 26, 1993.10, 12,15-18,21-25.

9,11, 13/ Original ...... June 25, 1992.14, 19/20,26.

This incorporation by reference wasapproved by the Director of the FederalRegister in accordance with 5 U.S.C.552(a) and 1 CFR part 51. Copies maybe obtained from Airbus Industrie, IRond Point Maurice Bellonte,31707Blagnac Cedex, France. Copies may beinspected at the FAA, TransportAirplane Directorate, 1601 LindAvenue, SW., Renton, Washington; or atthe Office of the Federal Register, 800North Capitol Street NW., suite 700,Washington, DC.

(e) This amendment becomes effectiveon January 10, 1994.


Issued in Renton, Washington, onDecember 6, 1993.Darrell M Pederson,Acting Manager, Transport AirplaneDirectorate, Aircraft Certification Service.[FR Doc. 93-30196 Filed 12-9-93; 8:45 amjMUM CODE 4910-1-P

14 CFR Part 39

[Docket No. 92-NM-1 99-AD; Amendm6nt394761; AD 93-g4-121

Airworthiness Directives; LockheedModel L-1011-385 Series Airplanes

AGENCY: Federal AviationAdministration, DOT.ACTION: Final rule.

SUMMARY: This amendment adopts anew airworthiness directive (AD).applicable to certain Lockheed ModelL-1011-385 series airplanes, thatrequires inspections of the cargo doorcomponents for cracks and corrosion:and modification, rework, orreplacement of discrepant parts. Thisamendment is prompted by the datagathered during the investigation of acargo door on a transport categoryairplane that opened while the airplanewas in flight, resulting in an explosivedecompression of the airplane. Theactions specified by this AD areintended to prevent a cargo door fromopening during flight, which couldresult in rapid decompression of theairplane.DATES: Effective on January 10, 1994.

The incorporation by reference ofcertain publications listed in theregulations is approved by the Directorof the Federal Register as of January 10,1994.ADDRESSE: The service informationreferenced in this AD may be obtainedfrom Lockheed Western ExportCompany (LWEC), Dept. 693, Zone0755,86 South Cobb Drive, Marietta,Georgia 30063. This information may beexamined at the Federal AviationAdministration (FAA), TransportAirplane Directorate, Rules Docket,1601 Lind Avenue, SW., Renton,Washington; or at the FAA, SmallAirplane Directorate, Atlanta AircraftCertification Office (ACO), 1669Phoenix Parkway, Atlanta, Georgia; or atthe Office of the Federal Register, 800North Capitol Street, NW., suite 700,Washington, DC.FOR FURTHER INFORMATION CONTACT:Thomas Peters, Aerospace Engineer,Atlanta Aircraft Certification Office(ACO), Flight Test Branch, ACE-160A,FAA, Small Airplane Directorate, 1669Phoenix Parkway, Atlanta. Georgia

30349; telephone (404) 991-3915; fax(404) 991-3606.

SUPPLEMENTARY INFORMATION: Aproposal to amend part 39 of the FederalAviation Regulations to include anairworthiness directive (AD) that isapplicable to certain Lockheed ModelL-1011-385 series airplanes waspublished in the Federal Register onMarch 16. 1993 (58 FR 14181). Thataction proposed to require an inspectionto ddtect excessive thickness of theshims installed under the hinges of theC-1A cargo door. It would also requirean inspection to detect cracks andcorrosion of the lower sill latch fittingsand the serrated plates of the C-1Acargo door, and to determine the heattreatment conditipn of the serratedplates. Discrepant parts would berequired to be modified, reworked, orreplaced.

Interested persons have been affordedan opportunity to participate in themaking of this amendment. Dueconsideration has been given to thecomments received.

One commenter supports theproposed rule.

The Air Transport Association (ATA)of America, on behalf of two of itsmembers, requests removal of theproposed requirement for a one-timevisual inspection to detect excessivethickness of the shims installed underthe hinges of the C-1A cargo door. Thissame inspection has already beenincluded in AD 91-05-05, Amendment39-6878 (56 FR 6556, February 19,1991). Therefore, the ATA maintainsthat a duplicate inspection of this areadoes not need to be included in theproposed rule. The FAA does notconcur totally. While the FAA concursthat identical inspection requirementsgenerally should not appear in twoseparate AD's, it now considers that thecompliance time required by AD 91-05-05 for the subject inspection is toolengthy. Instead, the FAA hasdetermined that the shorter compliancetime for accomplishment of thisinspection, as specified in this new ADaction, will ensure that excessivethickness of the shims installed underthe hinges of the C-1A cargo door willbe detected and corrected in a timelymanner. The final rule has been revisedto specify that compliance with thevisual inspection requirement ofparagraph (a) of this AD satisfies thesimilar inspection requirement of AD91-05-05 for this same area.

One commenter suggests thatoperators may become confused if therecommendations of Lockheed ServiceBulletins 093-52-155, Revision 1, datedOctober 23, 1989, and 093-53-252,

Revision 2, dated April 25, 1989, appeartogether in one AD, since the twoservice bulletins are unrelated. Fromthis comment, the FAA infers that thecommenter requests that each servicebulletin be addressed in a separaterulemaking action. The FAA does notconcur. Since each inspection isaddressed in a separate paragraph in theproposal, they are treated as separaterequirements. Both service bulletinsaddress service problems in the C-1Acargo door, even though they addressdifferent problems in different areas ofthe cargo door.

The same commenter requests that thewording of proposed paragraph (b)(2)(renumbered as paragraph (c)(2) in thisfinal rule) be revised from "replace thelatch fitting with a serviceable part" to"refurbish the latch fitting per Drawing1646587 or replace with a serviceablepart". The FAA does not concur thatrewording is necessary. The FAA infersthat the commenter believes thatclarification is necessary to specify thatreplacement with "refurbished parts"must be performed in accordance withDrawing 1646587, rather than LockheedService Bulletin 093-53-252, Revision2, dated April 25, 1989. The FAA hasdetermined that, as it is presentlyworded, the "Note" in paragraph (c) ofthe rule correctly states that thereferenced service bulletin refers toDrawing 1646587 for additionalprocedural information.


There are approximately 106Lockheed Model L-1011-385 seriesairplanes of the affected design in theworldwide fleet. The FAA estimates that32 airplanes of U.S. registry will beaffected by this AD, that it would takeapproximately 1.5 work hours perairplane to accomplish the actions onairplanes listed in Lockheed ServiceBulletin 093-52-155, andapproximately 7 work hours toaccomplish the actions on airplaneslisted in Lockheed Service Bulletin 093-53-252. The average labor rate is $55per work hour. Based on these figures,the total cost impact of the AD on U.S.operators is estimated to be $27,280, or$853 per airplane.

The total cost figure indicated aboverepresents a situation in which nooperator has yet accomplished therequirements of this AD. However, theFAA has been advised that 17 U.S.-registered airplanes have already beeninspected in accordance with therequirements of paragraph (a) of thisAD. Therefore, the future economic cost


impact of this rule on U.S. operators isnow only $25,878.


For the reasons discussed above, Icertify that this action: (1) Is not a"significant rdgulatory action" underExecutive Order 12866; (2) is not a"significant rule" under DOTRegulatory Policies and Procedures (44FR 11034, February 26, 1979); and (3)will not have a significant economicimpact, positive or negative, on asubstantial number of small entitiesunder the criteria of the RegulatoryFlexibility Act. A final evaluation hasbeen prepared for this action and it iscontained in the Rules Docket. A copyof it may be obtained from the RulesDocket at the location provided underthe caption "ADDRESSES."







Authority: 49 U.S.C. App. 1354(a), 1421and 1423; 49 U.S.C. 106(g); and 14 CFR

.11.89.

§39.13 [Amended]2. Section 39.13 is amended by

adding the following new airworthinessdirective:

93-24-12 Lockheed: Amendment 394761.Docket 92-NM-1 99-AD.

Applicability: Model L-101 1-385-1, -385-1-14,-385-1-15, and -385-3 seriesairplanes; as listed in Lockheed ServiceBulletin 093-52-155, Revision 1, datedOctober 23, 1989, and Lockheed ServiceBulletin 093-53-252, Revision 2, dated April25, 1989; certificated in any category.


To prevent failure of the cargo doorlatching mechanism, which could lead to the

cargo door opening during flight andresulting in rapid decompression of theairplane, accomplish the following:

(a) For airplanes listed in Lockheed ServiceBulletin 093-52-155, Revision 1, datedOctober 23, 1989: Prior to the accumulationof 8,000 total landings, or within 1,800landings after the effective date of this AD,whichever occurs later, perform a one-timevisual inspection to detect excessivethickness of the shims installed under thehinges of the C-1A cargo door in accordancewith Lockheed Service Bulletin 093-52-155,Revision 1, dated October 23, 1989.Accomplishment of this inspection isconsidered to constitute compliance with thesimilar inspection requirements of AD 91-05-05, Amendment 39-6878, for this samearea.

(1) If any shim is found that exceeds 0.125inch for single leg hinges, or 0.140 inch fordouble leg hinges, prior to further flight,install a structural doublet on the hinge anda new shim, in accordance with theprocedures described in the service bulletin.

(2) If any shim is found that equals or isless than 0.125 inch for single leg hinges, or0.140 inch for double leg hinges, no furtheraction is required for that shim.

(b) For airplanes listed in Lockheed ServiceBulletin 093-53-252, Revision 2, dated April25, 1989: Prior to the accumulation of 8,000total landings or within 1,800 landings afterthe effective date of this AD, whicheveroccurs later, inspect the lower sill latchfittings and serrated plates of the C-1A cargodoor for cracks and corrosion, In accordancewith Lockheed Service Bulletin 093-53-252,Revision 2, dated April 25, 1989.Additionally, perform a hardness test todetermine the condition of the heat treatmentof the serrated plates.

Note 1: Lockheed Service Bulletin 093-53-252, Revision 2, dated April 25, 1989, refersto Lockheed Service Modification/KitDrawing 1646587, Revision C, dated August14, 1987, for additional informationconcerning the inspection procedures,corrosion limit specifications, crack limitspecifications, and modifications relative tothe requirements of this paragraph.

(1) If any cracked latch fitting is found,prior to further flight, replace the latch fittingWith a serviceable part.

(2) If any corroded latch fitting is found,prior to further flight, replace the latch fittingwith a serviceable part. However, if the latchfitting is of a condition suitable forrefurbishment, as referred to in the servicebulletin, it may be refurbished and reused.

(3) If any cracked serrated plate is found,prior to further flight, replace it with aserviceable part. However, if the crackedserrated plate is determined to be suitable forreuse, as referred to in the service bulletin,it may be reinstalled for an additional 1,000landings only, at which time it then must bereplaced.

(4) If no crack or corrosion is found in anyserrated plate, prior to further flight, applycadmium plating to the plate in accordancewith the service bulletin.

(5) If any serrated plate is found withimproper heat treatment, prior to furtherflight, reprocess the plate or replace the platewith a serviceable part in accordance withthe service bulletin.

(c) An alternative method of compliance oradjustment of the compliance time thatprovides an acceptable level of safety may beused if approved by the Manager, AtlantaAircraft Certification Office (ACO), FAA,Small Airplane Directorate. Operators shallsubmit their requests through an appropriateFAA Principal Maintenance Inspector, whomay add comments and then send it to theManager, Atlanta AcO.

Note 2: Information concerning theexistence of approved alternative methods ofcompliance with this AD, if any, may beobtained from the Atlanta AcO.

(d) Special flight permits may be issued inaccordance with FAR 21.197 and 21.199 tooperate the airplane to a location where therequirements of this AD can beaccomplished.

(e) The inspection and installation shall bedone in accordance with Lockheed ServiceBulletin 093-52-155, Revision 1, datedOctober 23, 1989. The inspection, hardnesstest, replacement, refurbishment,reinstallation, application of cadmiumplating, and reprocessing shall be done inaccordance with Lockheed Service Bulletin093-53-252, Revision 2, dated April 25,1989, which contains the following list ofeffective pages:

Page ~ Revision Date shown onm r level shown pageon page

1,4-5 ....... 2 * ............... April 25, 1989.2-3 ............ Original ..... March 15, 1988.

The incorporation by reference of thesedocuments was approved by theDirector of the Federal Register inaccordance with 5 U.S.C. 552(a) and ICFR Part 51. Copies may be obtainedfrom Lockheed Western ExportCompany (LWEC), Dept. 693, Zone0755, 86 South Cobb Drive, Marietta,Georgia 30063. Copies may be inspectedat the FAA, Transport AirplaneDirectorate, 1601 Lind Avenue, SW.,Renton, Washington; or at the FAA,Small Airplane Directorate, AtlantaAircraft Certification Office (ACO), 1669Phoenix Parkway, Atlanta, Georgia; or atthe Office of the Federal Register, 800North Capitol Street, NW., suite 700,Washington, DC.

(f) This amendment becomes effectiveon January 10, 1994.

Issued in Renton, Washington, onDecember 6, 1993.Darrell M. Pederson,Acting Manager, Transport AirplaneDirectorate, Aircraft Certification Service.[FR Doc. 93-30197 Filed 12-9-93; 8:45 am]

BILUNG CODE 4910-1"-


14 CFR Part 71

[Airspace Docket No. 93-AWP-16]

Establishment of Class E Airspace;Oxnard, CA

AGENCY: Federal AviationAdministration (FAA), DOT.ACTION: Final rule.

SUMMARY: This action establishes ClassE airspace at Oxnard, California. TheClass E extension that was establishedusing the Camarillo Very HighFrequency Omnidirectional Range/Distance Measuring Equipment (VORDME) 2460 radial was in error. Thecorrect description should be theCamarillo VOR 2640 radial. This ruleprovides adequate Class E airspace forinstrument flight rules (IFR) operations.EFFECTIVE DATE: 0901 u.t.c.. March 3,1994.FOR FURTHER INFORMATION CONTACT:Charles Register, System ManagementSpecialist, System Management Branch.AWP-530, Air Traffic Division,Western-Pacific Region, FederalAviation Administration, 15000Aviation Boulevard, Lawndale,California 90261, telephone (310) 297-0433.SUPPLEMENTARY INFORMATION:

History

On September 23, 1993, the FAAproposed to amend part 71 of theFederal Aviation Regulations (14 CFRpart 71) to establish Class E airspace atOxnard, California (58 FR 49450). Thisaction corrects an error incurred duringthe Reclassification of Airspace,effective September 16, 1993. The ClassE4 airspace was inadvertently describedusing the 2460 radial and is now beingcorrected to the 2640 radial. This changewill provide correct and adequateairspace for the instrument procedureswest of Oxnard Airport, California.

Interested parties were invited toparticipate in this proposed rulemakingby submitting such written data, views,or arguments as they desired. Nocomments were received. Thisamendment is the same as that proposedin the notice. Class E airspacedesignations for airspace designated asan extension to Class D surface areas arepublished in Paragraph 6004 of FAAOrder 7400.9A dated June 17, 1993. andeffective September 16, 1993, which isincorporated by reference in 14 CFR71.1 (58 FR 36298; July 6, 1993). TheClass E airspace designation listed inthis document will be publishedsubsequently in the Order.

The RuleThis amendment to part 71 of the

Federal Aviation Regulations modifiesClass E airspace at Oxnard, California.The proposal is to correct an errorincurred during the Reclassification ofAirspace, effective September .16, 1993.

The Class E4 airspace wasinadvertently described using the 2460radial and is now being corrected to the2640 radial. This change will providecorrect and adequate airspace for theinstrument procedures west of OxnardAirport, California.

The FAA has determined that thisproposed regulation only involves anestablished body of technicalregulations for which frequent androutine amendments are necessary tokeep them operationally current. It,therefore-(1) is not a "significantregulatory action" under ExecutiveOrder 12866; (2) is not a "significantrule" under DOT Regulatory Policiesand Procedures (44 FR 11034, February26, 1979); and (3) does not warrantpreparation of a regulatory evaluation asthe anticipated impact is so minimal.Since this is a routine matter that willonly affect air traffic procedures and airnavigation, it Is certified that this rulewill not have a significant economicimpact on a substantial number of smallentities under the criteria of theRegulatory Flexibility Act.

List of Subjects in 14 C Part 71Airspace, Incorporation by reference,

Navigation (air).Adoption of the Amendment

In consideration of the foregoing, theFederal Aviation Administrationamends 14 CFR part 71 as follows:

PART 71-[AMENDED]1. The authority citation for 14 CFR

part 71 continues to read as follows:Authority: 49 U.S.C. app. 1348(a), 1354(a),

1510; E.O. 10854. 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389; 49 U.S.C. 106(g); 14 CFR11.69.

§71.1 [Amended]2. The incorporation by reference in

14 CFR 71.1 of the Federal AviationAdministration Order 7400.9A,Airspace Designations and ReportingPoints, dated June 17,.1993, andeffective September 16, 1993, isamended as follows:

Paragraph 6004-Subpart E-Class EAirspace Areas Designated as anExtension to a Class D Surface Area

AWP CA E4 Oxnard, CA [Revised]Oxnard Airport, CA

(lat. 34012'03" N, long. 119012'26"W)Camarillo VOR/DME

(lat. 34*12'45"N, long. 1i90O5'39"W)That airspace extending upward from the

surface within 1.8 miles either side of theCamarillo VOR 264 ° radial, extending fromthe 4.3 mile radius of the Oxnard Airport to13 miles west of the Camarillo VOR/DME.This Class E airspace is effective during thespecific dates and times established inadvance by a Notice to Airmen. The effectivedate and time will thereafter be continuouslypublished in the Airport/Facility Directory.

Issued in Los Angeles, California, onNovember 18, 1993.C. Roger Wall,Acting Manager, Air Traffic Division,Western-Pacific Region.[FR Doc. 93-30261 Filed 12-9-93; 8:45 am]BILLING CODE 4910-13"-

14 CFR Part 71

[Airspace Docket No. 93-AWP-6]

Establishment of Class D Airspace;Gila Bend, AZ

AGENCY: Federal AviationAdministration (FAA). DOT.ACTION: Final rule.

SUMMARY: This action establishes ClassD airspace at Gila Bend Air Force (AF)Auxiliary (AUX) Field, Gila Bend,Arizona. The U.S. Air Force operates acontrol tower at Gila Bend AF AUXField. Airspace Reclassification, whichbecame effective September 16, 1993,discontinued the use of the term"airport traffic area (ATA)" andeliminated those ATA's not alreadydesignated to become Class D airspace.As a result, the requirement for two-wayradio communication with the controltower at Gila Bend AF AUX Fieldlapsed. This rule provides adequateClass D airspace for instrument flightrules (IFR) operations and establishestwo-way radio communications at GilaBend AF AUX Field.EFFECTIVE DATE: 0901 U.T.C.. January 10,1994.FOR FURTHER INFORMATION CONTACT:Gene Enstad, Airspace Specialist,System Management Branch, AWP-530,Air Traffic Division, Western-PacificRegion, Federal AviationAdministration, 15000 AviationBoulevard, Lawndale, California 90261;telephone (310) 297-0010.

SUPPLEMENTARY INFORMATION:

History

On August 6, 1993, the FAA proposedto amend part 71 of the Federal AviationRegulations (14 CFR 71) to establishClass D airspace at Gila Bend AF AUX


airport, Gila Bend, AZ, to providesufficient airspace for instrument flightrules (IFR) operations and establish atwo-way radio communicationsrequirement.

Interested parties were invited toparticipate in this proposed rulemakingby submitting such written data, views,or arguments as they desired. Nocomments were received. Thisamendment is the same as that proposedin the notice. Class D airspacedesignations are published in Paragraph5000 of FAA Order 7400.9A dated June17, 1993, and effective September 16,1993, which is incorporated byreference in 14 CFR 71.1 (58 FR 36298;July 6, 1993). The Class D airspacedesignation listed in this document willbe published subsequently in the Order.

The Rule

This amendment to part 71 of theFederal Aviation Regulations establishesClass D airspace at Gila-Bend AF AUXairport, Gila Bend, AZ, to providecontrolled airspace from the surface upto and including 3,900 feet MSL andestablishes a two-way communicationsrequirement.

The FAA has determined that thisregulation only involves an establishedbody of technical regulations for whichfrequent and routine amendments arenecessary to keep them operationallycurrent. It, therefore-(1) Is not a"significant regulatory action" underExecutive Order 12866; (2) is not a"significant rule" under DOTRegulatory Policies and Procedures (44FR 11034; February 26, 1979); and (3)does not warrant preparation of aregulatory evaluation as the anticipatedimpact is so minimal. Since this is aroutine matter that will only affect airtraffic procedures and air navigation, itis certified that this rule will not havea significant economic impact on asubstantial number of small entitiesunder the criteria of the RegulatoryFlexibility Act.


Airspace, Incorporation by reference,Navigation (air).


In consideration of the foregoing, theFederal Aviation Administrationamends 14 CtR part 71 as follows:

PART 71-[AMENDED)

1. The authority citation for 14 CFRpart 71 continues to read as follows:

Authority: 49 U.S.C. app. 1348(a), 1354(a),1510; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389; 49 U.S.C. 106(g); 14 CFR11.69.

§71.1 [Amended]2. The incorporation by reference in

14 CFR 71.1 of the Federal AviationAdministration Order 7400.9A,Airspace Designations and ReportingPoints, dated June 17, 1993, andeffective September 16, 1993, isamended as follows:

Paragraph 5000-Subpart D-Cass DAirspace

AWP AZ D Gila Bend (New]Gila Bend AF AUX Airport, Gila Bend, AZ

(lat. 32*53'06"N, long. 112*43'14"W)That airspace extending upward from the

surface up to and including 3,900 feet MSLwithin a 4.2-mile radius of Gila Bend AFAUX Airport, excluding that airspace withinRestricted Area R-2305. This Class Dairspace is effective during the specific datesand times established in advance by a Noticeto Airmen. The effective date and time willthereafter be continuously published in theAirport/Facility Directory.

Issued in Los Angeles, California, onNovember 15, 1993.Richard R. Lien,Manager, Air Traffic Division, Western-PacificRegion.[FR Doec. 93-30259 Filed 12-9-93; 8:45 am)BILULN CODE 4910-tS-U

14 CFR Part 71

[Airspace Docket No. 93-AWP--17

Establishment of Class D Airspace;Barking Sands, Kauai, HI

AGENCY: Federal AviationAdministration (FAA), DOT.ACTION: Final rule.

SUMMARY: This action establishes ClassD airspace at Barking Sands PacificMissile Range Facility (PMRF), Kekaha,Kauai, Hawaii. The U.S. Navy operatesa control tower at Barking Sands PMRF,Kekaha, Kauai, Hawaii. AirspaceReclassification, which became effectiveSeptember 16, 1993, discontinued theuse of the term "airport traffic area"(ATA) and eliminated those ATA's notalready designated to become Class Dairspace. As a result, the requirement fortwo-way radio communication with thecontrol tower at Barking Sands PMRFAirport lapsed. This rule provides'adequate Class D airspace forinstrument flight rules (IFR) operationsand establishes two-way radiocommunications at Barking SandsPMRF Airport.EFFECTIVE DATE: 0901 U.T.C., January 10,1994.FOR FURTHER INFORMATION CONTACT:Gene Enstad, Airspace Specialist,

System Management Branch, AWP-530,Air Traffic Division, Western-PacificRegion, Federal AviationAdministration, 15000 AviationBoulevard, Lawndale, California 90261;telephone (310) 297-0010.


History

On September 23, 1993, the FAAproposed to amend part 71 of theFederal Aviation Regulations (14 CFRpart 71) to establish Class D airspace atBarking Sands PMRF, Kekaha, Kauai,Hawaii to provide sufficient airspace forinstrument flight rules (IFR) operationsand establish a two-way radiocommunications requirement.

Interested parties were invited toparticipate in this proposed rulemakingby submitting such written data, views,or arguments as they desired. Nocomments were received. Thisamendment is the same as that proposedin the notice. Class D airspacedesignations are published in Paragraph5000 of FAA Order 7400.9A dated June17, 1993, and effective September 16,1993, which is incorporated byreference in 14 CFR 71.1 (58 FR 36298;July 6, 1993). The Class D airspacedesignation listed in this document willbe published subsequently in the Order.

The RuleThis amendment to part 71 of the

Federal Aviation Regulations establishesClass D airspace at Barking SandsPMRF, Kekaha, Kauai, Hawaii, toprovide controlled airspace from thesurface up to and including 2,500 feetMSL and establishes a two-waycommunications requirement.

The FAA has determined that thisregulation only involves an establishedbody of technical regulations for whichfrequent and routine amendments arenecessary to keep them operationallycurrent. It, therefore-(1) is not a"significant regulatory action" underExecutive Order 12866; (2) is not a"significant rule" under DOTRegulatory Policies and Procedures (44FR 11034; February 26, 1979); and (3)does not warrant preparation of aregulatory evaluation as the anticipatedimpact is so minimal. Since this is aroutine matter that will only affect airtraffic procedures and air navigation, itis certified that this rule will not havea significant economic impact on asubstantial number of small entitiesunder the criteria of the RegulatoryFlexibility Act.


Airspace, Incorporation by reference,Navigation (air).


Adoption of the AmendmentIn consideration of the foregoing, the

Federal Aviation Administrationamends 14 CFR part 71 as follows:

PART 71--[AMENDED]


Authority: 49 U.S.C. app. 1348(a), 1354(a),1510; E.O. 10854. 24 FR 9565. 3 CFR, 1959-1963 Comp., p. 389; 49 U.S.C. 106(g); 14 CFR11.69.

171.1 [Amended2. The incorporation by reference in

14 CFR 71.1 of the Federal AviationAdministration Order 7400.9A,Airspace Designations and ReportingPoints, dated June 17, 1993, andeffective September 16, 1993, isamended as follows:

Paragraph 5000-Subpart D-Class DAirspace

AWP HI D Barking Sands PMRF [New]Barking Sands Pacific Missile Range Facility

Airport. Kekaha, Kauai. HI(laL 22*01'18"N, long. 159°47'12"W)That airspace extending upward from the

surface up to and including 2,500 feet MSLwithin a 5.1-mile radius of Barking Sands -PMRF Airport, excluding that airspace east ofa line 1.8 miles east of and parallel to theBarking Sands PMRF Airport north-southrunway. This Class D airspace is effectiveduring the specific'dates and timesestablished in advance by a Notice toAirmen. The effective date and time willthereafter be continuously published in theAirport/Facility Directory.t a * a *

Issued in Los Angeles. California, onNovember 15, 1993.Richard . Lien,Manager, Air Traffic Division, Western-PacificRegion.[FR Doc. 93-30260 Filed 12-9-3; 8:45 am)011M 0OOS 4 t1-4"

FEDERAL TRADE COMMISSION

16 CFR Part 228

Tire Advertising and Labeling Guides

AGENCY: Federal Trade Commission.ACTION: Final amendment of tireadvertising and labeling Guide 9.

SUMMARY: The Federal Commissionannounces that it has amended § 228.9(Guide 9) of the Tire Advertising andLabeling Guides, 16 CFR part 228 (TireGuides). The amendment deletes thethird sentence of that section, whichrequires sellers to designate retreadedtires as "retreads" or "retreaded," and

adds the sentence: "Any terms.disclosing that tires are not new alsoshall not misrepresent the performance,the type of manufacture, or any otherattribute of such tires. See § 228.18."With the amendments, sellers havefewer restrictions on how to advertisetheir tires, so long as the advertisementsclearly and conspicuously disclose thatthe retreaded tires are not new. Theamended Guide 9 emphasizes that anyterms used must be nondeceptive andrefers to § 228.18 (Guide 18), whichcontains a general prohibition againstthe use of misrepresentations by theseller.EFFECTIVE DATE: December 10, 1993.FOR FURTHER INFORMATION CONTACT:Robert Easton. Special Assistant-Enforcement, Federal TradeCommission, Washington, DC 20580,(202) 326-3029.SUPPLEMENTARY INFORMATION: TheAmerican Retreaders' Association, Inc.(ARA) and the Tread RubberManufacturers Group (TRMG) jointlypetitioned the Commission on August18, 1988, to revise Guide 9 of the TireGuides., Specifically, the petitionsought revision of Guide 9 to permit useof the term "remanufactured" whendescribing retreaded tires. ARA andTRMG contend that the change isnecessary "to more accurately reflect thepositive changes which have takenplace in this industry." The petitionersfurther contend that the term"retreaded" is too narrow a term todescribe one of many manufacturingprocesses used in the industry. Underthe petitioners' proposal, the term"remanufactured" could be usedgenerically to describe varioustechnological advances in the industrysuch as bead-to-bead retreading. -

The National Tire Dealers &Retreaders Association, Inc. (NTDRA)advised the Commission that it believesthe term "remanufactured" may beconfusing and possibly misleading toconsumers. It therefore opposedmodification of Guide 9. NTDRA alsostated that no change should be madewithout a public proceeding. It alsostated that if Guide 9 were to bereviewed publicly, all parts of the TireGuides should be reviewed.

The Commission considered thepetitioners' request and the letterNTDRA submitted, and solicited

' Guide 9 states: "Advertisements of used orretreaded products should clearly andconspicuously disclose that same are not newproducts. Unexplained terms, such as 'New Tread.''NuTread' and Snow Tread' as descriptive of suchtires do not constitute adequate disclosure that tiresso described are not new. All stich tires should beclearly designated as 'retreads' or 'retreaded."'

comment 2 on a proposed amendment toGuide 9.

Specifically, the Commission soughtcomment on whether the last sentenceof Guide 9 should be deleted. Therequest for comment was published inthe Federal Register on September 12,1990 (55 FR 37488), and theCommission received comments fromeight interested parties. Based upon thepetition, the pro-comment periodinformation-in its possession and thepublic comments it received, theCommission has determined to amendGuide 9 by deleting the last sentence.Further, the Commission amends Guide9 by adding the following sentence:

Any terms disclosing that tires are not newalso shall not misrepresent the performance.the type of manufacture, or any otherattribute of such tires. See § 228.18.

The intent of Guide 9 is to preventsellers from misleading consumers intobelieving that the seller is offering newtires when, in fact. the tires are used.but the effect of the Guide has been tolimit industry to use of only two termsto describe non-new tires. TheCommission believes it is preferable toavoid imposing such limitationsbecause they may have the effect ofinhibiting innovation by limiting theability of manufacturers to distinguishtheir products In the marketplace in anondeceptive manner. The Commissionconcludes from the record that thecurrent limitations should not beretained and the Guides should beamended to allow tire manufacturers theflexibility to describe not-new tires in anondeceptive manner.

There is no disagreement in thecomments with the view that termsother than retread and'retreaded canconvey the concept that tires are notnew or are previously used. Indeed, oneof the comments opposing theamendment states that terms other thanretread and retreaded can"nondeceptively" satisfy the intent ofGuide 9 (Comment from Trax RetreadTires, p.1). Another opposing commentagrees that the terms "remanufactured"and "recycled" do not describe newtires (Comment from RubberManufacturers Association (RMA), p.1).Further, a third comment notes that theword "remanufactured" in a termfrequently used in the automotive partsindustry and "by definition implies thatthe product is 'not new."' (Commentfrom Lakin General Corporation, p.2).

2 Because guides are merely interpretivestatements, the Commission is not required to givethe public an opportunity to participate inproceedings to amend them. Nevertheless. theCommission's policy generally is to obtain publiccomment on the promulgation of an Industry guide.


In addition, as stated in the commentfrom the Rubber ManufacturersAssociation, regardless of what termsare used- to describe retreaded tires orwhat process is used in the retreading,each retreaded tire must meet theDepartment of Transportation (DOT)standards for safety (49 CFR 571.117)(Comment from RMA, p.1). The DOTregulations also require that eachretreaded tire must be marked on thetire sidewall with the mark "DOT R" todifferentiate it from a new tire (49 CFR574.5). As RMA states, retreaded tires"* * are therefore readily identifiable

to consumers, regardless of whetherthey are marketed as 'retreaded,''remanufactured' or under some otherdesignation." (Comment from RMA,p.l).

Thus, there is no disagreement in thecomments that alternative terms putconsumers on notice that tires are notnew. This is consistent with the intentof Guide 9, and the nondeceptive use ofother terms serves this goal.

An alternative to amending Guide 9by deleting the last sentence would befor the Commission to amend Guide 9by expanding the list of "mandatory"terminology in the last sentence to.include, for example, not only"remanufactured," but also such termsas "recapped" or "remolded."Nevertheless, the record does notestablish that use of these terms only, orthat any restricted list of terms, isnecessary to inform consumersadequately of the nature of theirpurchase or to avoid deception. Deletionof the last sentence of Guide 9 ispreferable because it will allow sellersthe flexibility to use any nondeceptiveterms that "clearly and conspicuouslydisclose that (their tires) are not newproducts."

The Commission remains concernedthat tire manufacturers not resort tomisleading terminology. Tiremanufacturers, like any other marketersnot subject to specific regulationsimposing standardized terms, remainsubject to the general prohibitions of theFTC Act against deceptiverepresentations. Moreover, there is aspecific prohibition in Guide 18 of theTire Guides agqinst deceptive claims.The Commission, to emphasize thisobligation, amend Guide 9 to state thatany new terms "shall not misrepresentthe performance, the type ofmanufacture, or any other attribute ofsuch tires. See § 228.18." 3

3The new third sentence does not impose anynew obligations on the industry, since § 228.18 ofthe Guide already prohibits misleading claims.

List of Subjects in 16 CFR Part 228 'Advertising, Motor vehicles, Tires,

Trade practices.For the reasons set forth in the

preamble, 16 CFR Part 228 is amendedas follows:

PART 228--AMENDED]


Authority: Secs. 5,6, 38 Stat. 719, asamended, 721; 15 U.S.C. 45, 46.'

§228.9 (Amended]2. Section 228.9 is amended by

removing the sentence: "All such tiresshould be clearly designated as'retreads' or 'retreaded'" and by addingthe sentence: "Any terms disclosing thattires are not new also shall notmisrepresent the performance, the typeof manufacture, or any other attribute ofsuch tires. See § 228.18."

By Direction of the Commission.Donald S. Clark,Secretary.[FR Doc. 93-29404 Filed 12-9-93; 8:45 am]ma.UNG COoE 6750-01-M

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Social Security Administration

20 CFR Part 404RIN 0960-AD30

Federal Old-Age, Survivors andDisability Insurance; Suspension ofDependent's Benefits When a WorkerIs In an Extended Period of Eligibility

AGENCY: Social Security Administration,HHS.ACTION: Final rules.

SUMMARY: We are amending ourregulations which explain when aSocial Security disability beneficiarycan and cannot be paid monthlybenefits during the extended period ofeligibility which follows the completionof a trial work period. The amendmentsto the regulations reflect section 5118 of"the Omnibus Budget Reconciliation Actof 1990 (OBRA 1990) and provide thatno monthly Social Security benefits willbe paid to the dependents of a disabledworker for any month for which nomonthly Social Security disabilityinsurance benefits will be paid to thedisabled worker during the extendedperiod of eligibility.EFFECTIVE DATE: December 10, 1993.FOR FURTHER INFORMATION CONTACT:Lawrence.V. Dudar, Legal Assistant,

Office of Regulations, Social SecurityAdministration, 3-B-1 OperationsBuilding, 6401 Security Boulevard,.Baltimore, Maryland 21235, (410) 965-1759.SUPPLEMENTARY INFORMATION: Undersection 223(a)(1) of the Social SecurityAct (the Act), an individual receivingdisability insurance benefits whocompletes a trial work period andcontinues to have a disablingimpairment is provided an extendedperiod of eligibility. This extendedperiod of eligibility is referred to in ourregulations as the reentitlement period.See §§ 404.316(d), 404.401a and404.1592a. During this period, theindividual will be paid benefits inaccordance with sections 223(a)(1) and223(e) of the Act for all months inwhich he or she does not engage insubstantial gainful activity. Section223(e) of the Act provides, however,that no monthly benefits shall bepayable to any disability beneficiary,including a worker receiving disabilityinsurance benefits, for any month, afterthe third month, in which he or sheengages in substantial gainful activityduring this period.

Prior to the enactment of OBRA 1990(Pub. L. 101-508, enacted November 5,1990), section 223(e) of the Act wassilent regarding the payment of benefitsto the dependents of a disabled workerduring his or her extended period ofeligibility. OBRA 1990 included anamendment, section 5118, to clarify thisprovision. In its report on OBRA 1990,the Conference Committee explainedthat this amendment would codify ourexisting practice which, for purposes ofthe extended period of eligibility, linkeda dependent's entitlement to a benefitpayment for any month to the disabledworker's entitlement to payment for thatmonth. The Committee stated that underthis practice, a "dependent's benefitsare suspended during this period if thedisabled worker's benefits aresuspended." Conference CommitteeReport, OBRA 1990, H.R. Rep. No. 964,101st Cong., 2d Sess. 944 (1990).

Section 5118 of OBRA 1990 codifiesthis practice. It amends section 223(e) ofthe Act to provide that when paymentof a worker's disability insurancebenefits is suspended under that sectionfor any month during the extendedperiod of eligibility, monthly benefits toany other persons based on the worker'searnings record will not be paid for thatmonth.

These final rules amend ourregulations to reflect this amendment tosection 223(e) of the Act made bysection 5118 of OBRA 1990. The finalrules add a sentence to §§ 404.401 a and


404.1592a(a) to provide that if any otherperson is receiving monthly benefits onthe earnings record of an individualreceiving disability insurance benefits,that person will not be paid benefits forany month for which the disabledindividual cannot be paidbenefitsduring the reentitlement period. We alsoare revising the heading of § 404.401a toconform to the change to the text of thatsection.

Regulatory Procedures

Justification for Final Rules

The Department, even when notrequired by statute, as a matter ofpolicy, generally follows theAdministrative Procedure Act (APA)notice of proposed rulemaking andpublic comment procedures specified in5 U.S.C. 553 in the development of itsregulations. The APA providesexceptions to its notice and publiccomment procedures when an agencyfinds that there is good cause fordispensing with such procedures on thebasis that they are impracticable,unnecessary, or contrary to the publicinteresL We have determined that,under 5 U.S.C. 553(b)(B), good causeexists for waiver of notice of proposedrulemaking and public commentprocedures in these regulations becausethe regulations simply reflect a statutorychange that is self-executing. Theamendments to the regulations to reflectthis change are not discretionary and donot involve the setting of any policy.Therefore, we have determined thatopportunity for prior public comment isunnecessary. Consequently, theseamendments are being issued as finalrules.

Executive Order 12291

The Secretary has determined thatthis is not a major rule under ExecutiveOrder 12291 because these regulationswill not result in any significant costs orotherwise meet the criteria for a majorrule. Therefore, a regulatory impactanalysis is not required.

Paperwork Reduction Act

These final regulations impose noadditional reporting or recordkeepingrequirements subject to Office ofManagement and Budget clearance.

Regulatory Flexibility Act

The Secretary certifies that these finalregulations will not have a significanteconomic impact on a substantialnumber of small entities because theyaffect only individuals. Therefore, aregulatory flexibility analysis asprovided in Public Law 96-354, theRegulatory Flexibility Act, is notrequired.

(Catalog of Federal Domestic AssistanceProgram Nos. 93.802 Social SecurityDisability Insurance; No. 93.803 SocialSecurity-Retirement Insurance).


Administrative practice andprocedure, Blind, Disability benefits,Old-age, Survivors, and DisabilityInsurance, Reporting and recordkeepingrequirements, Social Security.

Dated: July 23, 1993.Lawrence H. Thompson,Principal Deputy Commissioner of SocialSecurity.

Approved: September 30, 1993.Donna E. Shalala,Secretary of Health an d Human Services.

For the reasons set out in thepreamble, subparts E and P of part 404of chapter III, title 20 of the Code ofFederal Regulations are amended asfollows:

PART 404-FEDERAL OLD-AGE,SURVIVORS AND DISABILITYINSURANCE (1950-

1. The authority citation for subpart Eof part 404 continues to read as follows:

Authority; Secs. 202, 203, 204 (a) and (e),205 (a) and (c), 222(b), 223(e), 224, 227, and1102 of the Social Security Act; 42 U.S.C.402, 403, 404 (a) and (e), 405 (a) and (c),422(b), 423(o), 424,427, and 1302.

2. Section 404.401a is amended byrevising the section heading and byadding a new sentence immediatelyafter the second sentence of that sectionto read as follows:

§404.401a When we do not pay benefitsbecause of a disability beneficiary's workactivity.

* * * If anyone else is receiving

monthly benefits based on your earningsrecord, that individual will not be paidbenefits for any month for which youcannot be paid benefits during thereentitlement period.* * *

3. The authority citation for subpart Pof part 404 is revised to read as follows:

Authority: Secs. 202, 205 (a), (b), and (d)through (h), 216(i), 221 (a) and (i), 222(c),223, 225, and 1102 of the Social Security Act;42 U.S.C. 402, 405 (a), (b), and (d) through(h), 416(i), 421 (a) and (i), 422(c), 423, 425,and 1302; sec. 505(a) of Public Law 96-265,94 Stat. 473, secs. 2(d)(2), 5.6, and 15 ofPublic Law 98-460. 98 Stat. 1797, 1801,1802, and 1808.

4. Section 404.1592a is amended byadding immediately after the thirdsentence of paragraph (a), which begins"(See§§404.316 * *),"anewsentence to read as follows:

§404.1592a The reentltlement period.(a) General. * .* If anyone else is

receiving monthly benefits based onyour earnings record, that individualwill not be paid benefits for any monthfor which you cannot be paid benefitsduring the reentitlement period. * * *

iFR Dc. 93-30153 Filed 12-9-93; 8:45 aml8ILUNG COOE 410-49-P

20 CFR Parts 404 and 416

RIN 0960-AC87

Federal Old-Age, Survivors, andDisability Insurance and SupplementalSecurity Income for the Aged, Blind,and Disabled; Representation ofClaimants for Benefits Under Title IIand/or Title XVI

AGENCY: Social Security Administration,HHS.ACTION: Final rule.

SUMMARY: This final rule amends ourexisting regulations on therepresentation of parties to implementthe provisions of section 10307(b) of theOmnibus Budget Reconciliation Act of1989 (OBRA). Section 10307(b)amended the Social Security Act (Act)to require that notices of adversedeterminations made by the SocialSecurity Administration (SSA) on orafter January 1, 1991, under the SocialSecurity program of title II and thesupplemental security income (SSI)program of title XVI, notify claimants ofthe options for obtaining attorneyrepresentation in presenting their casesbefore us and of the availability, toqualifying claimants, of legal servicesorganizations that provide legal servicesfree of charge.EFFECTIVE DATE: These final regulationsare effective December 10, 1993.FOR FURTHER INFORMATION CONTACT:Philip Berge, Legal Assistant, 3-B-1Operations Building, 6401 Security

'Boulevard, Baltimore, MD 21235, (410)965-1769.SUPPLEMENTARY INFORMATION: By noticeof proposed rulemaking (NPRM)published October 28, 1991 (56 FR55475), we proposed to implementsection 10307(b) by adding new§ 404.1706 to subpart R of part 404 andnew § 416.1506 to subpart 0 of Part 416.We have carefully analyzed thecomments received in response to theNPRM and have modified the final rulebased on our consideration of thosecomments.

The regulations currently in effect donot require SSA to notify claimants ofthe options for obtaining attorneyrepresentation in presenting their cases


or of the availability, to qualifyingclaimants, of legal servicesorganizations that provide legal servicesfree of charge. However, it has long beenour practice to inform claimants andbeneficiaries of their right to berepresented, if they choose, by anattorney or nonattorney at each step ofthe administrative review process, andto provide more detailed information,including lists of attorney referral andlegal services organizations and ofcommunity organizations that mightprovide nonattorney representation, toclaimants and beneficiaries who inquireabout representation or request ahearing before an administrative lawjudge (ALJ).

We provide such notice andadditional information in furtherance ofthe provisions of sections 206 and1631(d) of the Act permitting therepresentation of claimants by attorneysand nonattorneys, and in accordancewith our longstanding practice ofneither encouraging nor discouragingclaimant representation. In addition, asa result of the amendment of section 206and 1631(d) by OBRA section 10307(b),we have revised our notices of adversedeterminations and decisions subject tothe administrative review process toinform claimants and beneficiaries ofthe options for obtaining attorneys andof the availability, to qualifyingclaimants, of legal servicesorganizations that provide legal servicesfreV of charge.

We proposed the following headingfor new §§ 404.1706 and 416.1506:"Notification of options for obtainingattorney representation." The. proposedregulations stated-

Whether or not you have advised us thatyou are represented by an attorney, if we

make a determination or decision that issubject to the administrative review processprovided under subpart (IN) of theseregulations and it does not grant all of thebenefits or other relief you requested or itadversely affects any (entitlement to/eligibility for) benefits'that we haveestablished or may establish for you, we willinclude with the notice of that determinationor decision information about your optionsfor obtaining an attorney to represent you indealing with us. We will also tell you that alegal services organization may provide youwith legal representation free of charge if yousatisfy the qualifying requirements applicableto that organization.

Final RegulationsAfter considering the comments on

the NPRM, we are publishing finalregulations that differ from thoseproposed in one respect. We haverevised the introductory clause of thefirst sentence of §§ 404.1706 and416.1506 to state: "If you are not

represented by an attorney and wemakea determination or decision that issubject to the administrative reviewprocess provided under subpart (J/N) ofthese regulations and it does not grantall of the benefits or other relief yourequested or it adversely affects any(entitlement to/eligibility for) benefitsthat we have established or mayestablish-for you, * * *." This changeremoves the requirement from theproposed regulations that the OBRAinformation be included with thenotices of adverse determinations anddecisions described in the regulationswhen the claimant or beneficiary isalready represented by an attorney. Wehave made this change because webelieve that the purpose of section10307(b) of OBRA can be construed soas not to require that we givenotification of the options for obtainingattorney representation to a claimantwho has already appointed an attorneyto represent him or her. We also agreewith the commenters, as discussedbelow under the heading PublicComments and Responses, that sendingsuch notificatibn to a claimant who isalready represented might lead toconfusion in the attorney-clientrelationship.

Public Comments and ResponsesWe received comments from three

private attorneys, two law firms, aprivate attorney commenting on behalfof a disability law project, and anational association of representatives.In addition, a State agency disabilitydetermination service (DDS) reportedthat it had no significant problem withthe proposed new regulations and thatit was including the language providedby SSA with its personalized disabilitynotices.

In analyzing the comments in terms ofthe issues raised and the changesrecommended, we have identified twoprincipal comments and severalsecondary issues and recommendations,as discussed below. The DDS raised noissues and did not recommend anychanges; therefore, we are not treating itas a commenter for the purpose of thefollowing discussion.

Comment: Do not require inclusion ofthe OBRA information with notices ofadverse determinations and decisionssent to individuals who have alreadyappointed attorney representatives.

Each of the seven commenters favorednot requiring provision of the OBRAinformation when the claimant orbeneficiary is already represented by anattorney. One commenter also favorednot providing that information when theclaimant or beneficiary is representedby a nonattorney, and another thought

individuals represented by nonattorneysshould not receive the same informationas unrepresented individuals. Theselatter two commenters favored havingthe final regulations expressly prohibitSSA from providing the OBRAinformation to represented claimants.

The commenters agreed thatincluding the OBRA information withnotices sent to claimants or beneficiarieswho have appointed attorneyrepresentatives would cause confusion.Some of the specific problemsanticipated were that some noticerecipients would think their attorneyshad abandoned their claims and thatothers would think the Agency wassuggesting they should seek differentcounsel.

Two commenters thought thatproviding the OBRA information inthese circumstances could interfere withestablished attorney-clientrelationships, and another concluded -that it represented an action by SSA tocompound the difficulties of privatepractitioners.

Also, the commenters generallythought that including the OBRAinformation with all the noticesdescribed in the proposed rules wasunnecessary. Most expressed concernsthat doing so would generate claimantinquiries and that responding to thoseinquiries would involve unnecessarywork for both the Agency and claimantcounsel. Several commenters stressedthe importance of not placingadditional, unnecessary burdens onSSA's field offices.

Response: Section 10307(b) requiresus to provide information on the optionsfor obtaining attorney representation to"each claimant" receiving an adversedetermination and applies to "adversedeterminations made on or after January1, 1991."

Therefore, in the NPRM we proposedincluding that information with alladverse determinations and decisionssubject to the administrative reviewprocess to ensure compliance with thestatute.

A strict reading of the statutorylanguage could result in our sendingnotices to claimants, who we know arerepresented by attorneys in proceedingsbefore us, that advise them that they canappoint an attorney to represent them inproceedings before us. Such a resultwould not seem consistent with thepurpose of section 10307(b). Theseclaimants have already exercised theiroptions to appoint lawyers to representthem. Rather, it seems reasonable toconstrue the statutory language as notrequiring that such claimants be notifiedthat they can appoint counsel,particularly when such an interpretation


would void the possibility of confusingclaimants already represented byattorneys and seeming possibly tointerfere in the relationship alreadyestablished between such claimants andtheir attorneys. It would also seem tofollow that if such claimants should notbe notified of an option to seek anattorney because they already have anattorney, that they need not be advisedof the availability of free legal services,particularly in those instances wherethey are already represented byorganizations providing free legalservices.

After assessing the commentsreceived, we have modified the finalregulations as discussed above-i.e., notto require inclusion of the OBRAinformation with notices of adversedeterminations or decisions if theclaimant or beneficiary is representedby an attorney. As indicated above, webelieve that OBRA section 10307(b) isprimarily directed at ensuring theavailability of information on theoptions for obtaining attorneyrepresentation to individuals who donot have attorneys. Continuing to adviseindividuals who are represented by anattorney of their options concerningattorney representation after they obtainsuch representation could causeconfusion and would not seem tofurther the purpose of section 10307(b).Doing so could also generate timeconsuming work, for the Agency andclaimant counsel.

Very few claimants appoint anattorney representative until after theyhave received at least one notice of anadverse determination.Therefore,almost all claimants who receive anotice under this final rule will receivethe information on options for obtainingattorney representation at least once.Only those claimants who have already.obtained attorney representatives beforpthe first adverse determinations on theirclaims will not be sent at least oneOBRA notice on attorney representation.

Because we believe § 10307(b) shouldnot be construed to require notificationof the options for obtaining attorneyrepresentation except where theclaimant already has an attorney, thefinal regulations require provision ofthis information when the claimant isunrepresented or is represented by anonattorney. However, as we noted inthe preamble of the NPRM, thesestatutory amendments and theseregulations do not limit our ability toprovide additional information onrepresentation, including informationon the right to represent oneself or to berepresented by a nonattorney. Moreover,given the lack of a specific limitation inthe statutory amendments, we have not

adopted the suggestion of the twocommenters to state in the final rulewhen we might not providerepresentational information.

Comment: The regulation shouldprescribe criteria concerning therepresentation referral lists SSAprovides and expressly obligate SSA toprovide complete information on theoptions for obtaining attorneys.

Stating that the proposed rule seemedto envision providing the names ofattorney referral services, legal servicesorganizations and communityorganizations which providerepresentation, and that these are not-for-profit sources, one commenterrecommended expanding theregulations to state explicitly that onlynot-for-profit organizations may beincluded. Another commenter statedthat the lists of representation referralsources provided by different SSAoffices are not always complete andthat. to the extent the lists areincomplete, the Agency may be seen tobe directing claimants to certain sourcesto the disadvantage of others. Thiscommenter thought the statute imposesan affirmative obligation on the Agencyto ensure that the information itprovides on the options for obtaining anattorney is complete and that the finalregulations should express thisobligation.

Response: We did not plan to providein the OBRA notices the names ofspecific legal services organizations,attorney referral services, or communityorganizations that may providerepresentation. Rather, the notices willadvise claimants of the options forobtaining attorneys to represent themand of the availability to qualifyingclaimants of legal services organizationswhich provide legal services free ofcharge.

One of a claimant's options forobtaining attorney representation is, webelieve, to use the services oforganizations that can assist them inobtaining counsel or, if they qualify, freelegal services. Therefore, as thepreamble to the NPRM noted, the OBRAnotice will advise claimants of thisoption and further advise them thatlocal Social Security offices haveadditional information about specificorganizations in their local area. Thoughnot required by statute, we believe thatproviding lists of specific organizationsat the local level will make it easier forthose claimants who wish to pursue thisoption.

Under the existing procedures, as theNPRM pointed out, we providerepresentation referral lists to claimantswho inquire about representation orrequest an ALJ hearing. If a claimant has

not reached the ALJ level, we make theprovision of such a list contingent on aninquiry by the claimant; at the ALJhearing level we take the initiative ofproviding representation referral lists inacknowledging receipt of requests forhearing filed by individuals who havenot appointed re resentatives.

We provide referral lists at the ALJlevel to facilitate the orderly operationof the hearing process by promotingprompt decisions about representationby individuals who generally decide toappoint representatives during the laterstages of the administrative reviewprocess. (We instituted that procedurein 1979 after representation rates at thehearing step had risen substantially).We do not take the initiative of

roviding lists before the hearing stepecause individuals at the initial and

reconsideration steps of the process donot usually choose to be represented.

While the procedures differ, eachconforms to our longstanding practice ofneither encouraging nor discouragingclaimant representation. We providerepresentation referral lists to claimantswho inquire about representation toassist individuals who have alreadyindicated an interest in representation.We provide such lists at the hearinglevel on our initiative to promote theorderly operation of the hearing process.

We do not believe representationreferral lists themselves must beprovided as part of the notice of theoptions for obtaining attorneyrepresentation. Therefore, we have notmodified the regulations to so providein these final regulations.

While our reason for not changing theregulations in this respect is that webelieve representation referral lists arenot required under section 10307(b),there are also practical reasons for notincluding such lists with our notices.Representation referral lists need toprovide locale-specific information.Inclusion of lists providing suchinformation with notices of adversedeterminations or decisions wouldinvolve operational problems in that wegenerate many of these notices centrallyon large computerized systems.Providing such lists with notices ofadverse determinations and decisionswould also involve ongoingadministrative costs.

We believe it would be inappropriateto prescribe criteria for representationreferral lists in regulationsimplementing the statutory noticerequirement established in section10307(b). We plan to continue providingrepresentation referral lists to claimantswho inquire about representation orwho request an ALJ hearing because wehave been able to provide such lists

64886 Federal Register / Vol. 58, No. 236 / Friday, December 10. 1993 / Rules and Regulations

with little controversy to the benefit ofmany individuals. However, we do notbelieve that defining these lists inregulations at this time would behelpful.

With the changes as noted above, theregulations as proposed are adopted.



The Secretary has determined thatthis is not a major rule under ExecutiveOrder 12291 because it will result innegligible administrative costs andsavings. Therefore, a regulatory impactanalysis is not required.


We certify that these regulations willnot have a significant economic impacton a substantial number of small entitiesbecause these rules will affect onlyindividuals. Therefore, a regulatoryflexibility analysis as provided in Pub.L. 96-354, the Regulatory FlexibilityAct, is not required.


These regulations impose no newreporting or recordkeeping requirementsrequiring Office of Management andBudget clearance.(Catalog of Federal Domestic AssistanceProgram Nos. 93.773 and 93.774, Medicare;93.802-93.805 Social Security; and 93.807Supplemental Security Income.)

List of Subjects

20 CFR Part 404

Administrative practice andprocedure, Death benefits, Disabilitybenefits, Old-Age, Survivors, andDisability Insurance, Reporting andrecordkeeping requirements.

20 CFR Part 416

Administrative practice andprocedure, Aged, Blind, Disabilitybenefits, Public assistance programs,Supplemental Security Income (SSI),Reporting and recordkeepingrequirements.

Dated: July 23.1993.Lawrence H. Thompson,Principal Deputy Commissioner of SocialSecurity.

Approved: September 30, 1993.Donna E. Shalala,Secretary of Health and Human Services.

For the reasons set out in thepreamble, subpart R of part 404 andsubpart 0 of part 416 of 20 CFR chapterI are amended as follows:

PART 404--FEDERAL OLD-AGE,SURVIVORS AND DISABILITYINSURANCE (1950- )

1. The authority citation for subpart Rof part 404 continues to read as follows:

Authority- Secs. 205(a), 206, and 1102 ofthe Social Security Act; 42 U.S.C. 405(a).'406,and 1302.

2. New § 404.1706 is added to read asfollows:

§ 404.1706 Notification of options forobtaining attorney representation.

If you are not represented by anattorney and we make a determinationor decision that is subject to theadministrative review process providedunder subpart J of this part and it doesnot grant all of the benefits or otherrelief you requested or it adverselyaffects any entitlement to benefits thatwe have established or may establish foryou, we will include with the notice ofthat determination or decisioninformation about your options forobtaining an attorney to represent youin dealing with us. We will also tell youthat a legal services organization mayprovide you with legal representationfree of charge if you satisfy thequalifying requirements applicable tothat organization.

PART 416-SUPPLEMENTALSECURITY INCOME FOR THE AGED,BLIND, AND DISABLED

1. The authority citation for subpart 0of part 416 continues to read as follows:

Authority: Secs. 1102 and 1631(d) of theSocial Security Act; 42 U.S.C. 1302 and1383(d).

2. New § 416.1506 is added to read asfollows:

§416.1506 Notification of options forobtaining attorney representation.

If you are not represented by anattorney and we make a determinationor decision that is subject to theadministrative review process providedunder subpart N of this part and it doesnot grant all of the benefits or otherrelief you requested or it adverselyaffects any eligibility to benefits that wehave established or may establish foryou, we will include with the notice ofthat determination or decisioninformation about your options forobtaining an attorney to represent youin dealing with us. We will also tell youthat a legal services organization mayprovide you with legal representationfree of charge if you satisfy thequalifying requirements applicable tothat organization.IFR Dec. 93-30152 Filed 12-9-93; 8:45 am]BILLNG ODE 4100-f9-P

20 CFR Part 404RIN 0960-AC68

Federal Old-Age, Survivors, andDisability Insurance; Suspension ofBenefits Where Individual Is Deported;Exemption From Social SecurityBecause of Religious Beliefs


SUMMARY: These final rules are beingissued to reflect provisions of theTechnical and Miscellaneous RevenueAct of 1988, the Omnibus BudgetReconciliation Act of 1989, and theImmigration Act of 1990. Theseprovisions concern: The suspension ofSocial Security benefits if an individualis deported under certain provisions ofthe Immigration and Nationality Act, anexemption from Social Security foremployees and employers who are bothmembers of certain religious faithsopposed to acceptance of insurancebenefits including those provided bySocial Security, and an exemption fromSocial Security for certain employees ofchurches and church-controlledorganizations.EFFECTIVE DATE: These final rules areeffective December 10, 1993.FOR FURTHER INFORMATION CONTACT:Lawrence V. Dudar, Legal Assistant,Office of Regulations, Social SecurityAdministration, 3-B-1 OperationsBuildings, 6401 Security Boulevard,Baltimore, MD 21235, (410) 965-1759.SUPPLEMENTARY INFORMATION: Thesefinal rules make several technicalchanges in our rules. First, they reflectthe provision of the Technical andMiscellaneous Revenue Act of 1988(TAMRA), Public Law 100-647, thatprovided for the nonpayment of SocialSecurity benefits if an individual isordered deported from the United Statesbecause of certain past activitiesperformed under the direction of or inassociation with the Nazi government ofGermany or one of its allies. Second,they reflect the provisions of theImmigration Act of 1990, Public Law101-649, that amended section 241 ofthe Immigration and Nationality Actconcerning the grounds for deportationand made conforming changes insection 202(n) of the Social SecurityAct. Section 202(n) concerns thenonpayment of Social Security benefitsif an individual is deported undercertain provisions of section 241(a) ofthe Immigration and Nationality Act.

The final rules also reflect the,provision of TAMRA that provided anexemption from Social Security for an


employee and his or her employer ifboth belong to a religious faith and areadherents to established tenets andteachings of that faith opposed toacceptance of insurance benefitsincluding those provided by the SocialSecurity program. Additionally, thefinal rules reflect the provisions of theOmnibus Budget Reconciliation Act of1989 (OBRA), Public Law 101-239, thatprovided an exemption from SocialSecurity for (1) an employee of apartnership if both the employee andthe members of the partnership (each ofthe partners) belong to a religious faithand are adherents to the establishedtenets and teachings of that faithopposed to acceptance of insurancebenefits including those provided by theSocial Security program and (2) personswho have religious convictions inopposition to the acceptance ofinsurance benefits including thoseprovided by Social Security and whoare employees of churches or church-controlled organizations, but who aretreated as self-employed individualsbecause the employing church ororganization has exercised its option tobe exempt from paying the employerportion of the Social Security tax.

On May 28, 1991, we published anotice of proposed rulemaking at 56 FR24043 reflecting the provisions ofTAMRA and OBRA that are discussedbriefly above and in more detail below.We received no comments on theproposed rules, which we are nowpublishing as final rules. The proposedrules, however, did not reflect theprovisions of the Immigration Act of1990 which amended section 241 of theImmigration and Natiopality Act withrespect to the grounds for deportationand section 202(n) of the Social SecurityAct. Section 202(n) was amended toconform to the changes made withrespect to the grounds for deportationset out in section 241 of the Immigrationand Nationality Act. In these final ruleswe are further amending § 404.464 ofour regulations to reflect these statutoryamendments.Nonpayment of Benefits WhereIndividual Is Deported

Section 202(n) of the Social SecurityAct provides that no monthly benefitsshall be paid to a beneficiary entitled toold-age or disability insurance benefitson his or her wages or self-employmentincome who is ordered deported fromthe United States under certainprovisions of the Immigration andNationality Act. It also provides that ifsuch a beneficiary is ordered deportedunder one of those provisions, no lumpsum death benefit shall be paid on thebasis of his or her earnings record and

other benefits that may be payable onhis or her earnings record may not bepaid to a non-United States citizenoutside the United States.

Section 8004 of TAMRA amendedsection 202(n) of the Social Security Actby adding a reference to paragraph 19 ofsection 241(a) of the Immigration andNationality Act and thereby adding Naziwar criminals to the list of individualsto whom benefits are not payable due totheir deportation. Section 602 of theImmigration Act of 1990 revised thegrounds for deportation set forth insection 241(a) of the Immigration andNationality'Act. The new law replacedthe 19 grounds for deportationpreviously listed in the Immigration andNationality Act with five classes ofdeportable aliens, with a number ofgrounds for deportation listed withinthose five classes. The legislative historyof section 602 states that one of thepurposes of this "comprehensive"revision was "to make the law morerational and easy to understand." SeeH.R. Conf. Rep. No. 101-955, 101stCong., 2nd Sess. 128 (1990).

Section 603(b) of the Immigration Actof 1990 made a conforming amendmentto section 202(n) of the Social SecurityAct to provide for the nonpayment ofbenefits to individuals deported underthe provisions of section 241(a) (otherthan under paragraph (1)(C) or (1)(E)) ofthe Immigration and Nationality Act.Paragraph (1)(C) provides for thedeportation of aliens who violate certainconditions of entry and of aliensadmitted as nonimmigrants who fail tomaintain that status. Paragraph (1)(E)provides for the deportation of alienswho assist other aliens entering orattempting to enter the United Statesillegally. As amended by theImmigration Act of 1990, section 202(n)of the Social Security Act continues toprovide for the nonpayment of benefitsto individuals deported because of actsof persecution committed under thedirection of or in association with theNazi government of Germany or itsallies. The Immigration Act of 1990,which became law on November 29,1990, provides that the amendments itmade which are discussed above shallnot apply to deportation proceedings forwhich notice had been provided to thealien prior to March 1, 1991. We areamending §404.464 of our regulationsto reflect these statutory changes.Exemption From Social Security forEmployees and Employers Who AreBoth Members of Certain ReligiousFaiths

Section 8007 of TAMRA added a newsection 3127 to the Internal RevenueCode (the Code) and a conforming'

amendment to section 202(v) of theSocial Security Act. Under this statutorychange, an employee and his or heremployer may file applications with theInternal Revenue Service (IRS) forexemption from their respective sharesof the Federal Insurance ContributionsAct taxes on the employee's wages.based upon their religious convictionsin opposition to acceptance of insurancebenefits including those provided bySocial Security. In order for theexemption to be granted, both theemployee and his or her employer musthave applications filed and approvedand both must submit waivers of theirright to receive benefits, under title U1and part A of title XVIII of the SocialSecurity Act. Under section 202(v) ofthe Social Security Act, no benefits orother payments are payable under titleH1 and part A of title XVIII to theindividual who files such a waiver andreceives such an exemption.,In addition,no benefits or other payments arepayable under title II and part A of titleXVIII on the basis of the exemptedindividual's wages and self-employmentincome to any other person after thefiling of the waiver.

Prior to the enactment of TAMRA, theavailability of a Social Security taxexemption on religious grounds waslimited under sections 202(v) and211(cX6) of the Social Security Act andsection 1402(g) of the Code toindividuals who were self-employed.Sections 404.1075 and 404.305 of theregulations implement the exemptionfrom the Social Security self-employment tax and the correspondingwaiver of benefits. The TAMRAenactment extends to an employee andhis or her employer the right to requesta Social Security tax exemption if theyboth have religious convictions inopposition to participation in insuranceprograms including Social Security.Additionally, it provides that noexemption will be granted if theemployee would be receiving benefitsbut for suspension of his or her benefitsunder section 203 or section 222(b) ofthe Social Security Act. This rulealready applied to the exemption forself-employed persons, but was notreflected in the regulations. We aretherefore revising § 404.1075 to reflectthis rule for the self-employed and todescribe the circumstances under whichthe tax exemption will cease to beeffective and the effect of such atermination on the correspondingwaiver of benefits. We are alsoamending'S 404.305(a), which discussesthe effect of the waiver of benefits, torevise a reference to the regulatorysection describing the tax exemption on


religious grounds for self-employedpersons to reflect that that sectioncurrently appears in § 404.1075, and toclarify that, in order for a waiver ofbenefits to be applicable, it is necessaryfor the applicant to be granted a taxexemption in addition to filing thewaiver.

Section 10204(b) of OBRA amendedsection 3127 of the Code to provide thatthe tax exemption is available when anemployee of a partnership and eachpartner in that partnership havereligious convictions in opposition toparticipation in insurance programsincluding Social Security and fileapplications for exemption whichinclude waivers of their right to receivebenefits under title I and part A of titleXVIII of the Social Security Act.

To reflect these new statutoryprovisions concerning the employee andemployer, we are adding a cross-reference to § 404.305(a) of subpart Dand adding a new section to subpart K,§ 404.1039, which is modeled after§ 404.1075, to state that, in order for thetax exemption to be granted, both anemployee and his or her employer (or,if the employer is a partnership, each ofits partners) must-

1. Belong to a recognized religioussect or a division thereof; and

2. Adhere to the tenets or teachings ofthat sect or division of the sect and forthat reason conscientiously oppose theacceptance of insurance benefits fromany public or private insuranceincluding Social Security that-

a. Makes payment in the event ofdeath, disability, old-age, or retirement;or

b. Makes payment for the cost of, orprovides services for, medical care(including the benefits of any insurancesystem establisl~ed by the SocialSecurity Act); and

3. File applications with IRS forexemption from Social Security taxation(which includes a waiver of the right toreceive benefits under title II and part Aof title XVIII of the Social Security Act)that IRS approves pursuant to section3127 of the Code.

In order for an application to beapproved, we must find that the sect ordivision of the sect has establishedtenets or teachings which cause theapplicant to be conscientiously opposedto receiving the types of insurancebenefits described above, that the sect ordivision of the sect has continuouslybeen in existence since December 31,1950, and that its members makeprovision for dependent members that isreasonable in view of their general levelof living.

An application for exemption will beapproved by the IRS only if no benefits

became payable (or, but for section 203or section 222(b) of the Social SecurityAct, would have become payable) to theapplicant at or before the time theapplication was filed. Once IRSapproves the tax exemption authorizedunder section 3127 of the Code, theexemption continues until theexemption requirements are no longermet. If the exemption ceases to be ineffect, the waiver of the right to receiveSocial Security and Medicare benefitswill also no longer apply. However,earnings for years before the waiverceases to apply cannot be used forSocial Security benefit purposes.

The exemption provided under thesestatutory amendments applies to wagespaid after December 31, 1988.

Exemption From Social Security ofWorkers in Churches and Church-.Controlled OrganizationsI

Section 10204(a) of OBRA amendedsection 1402(g) of the Code. Under thisstatutory change, employees of churchesand church-conttolled organizationswho are treated as self-employedindividuals because the employingchurch or church-controlledorganization has been approved forexemption from payment of the FederalInsurance Contributions Act tax onreligious grounds are exempt frompayment of the Self-EmploymentContributions Act tax effective for taxyears beginning January 1, 1990, if theworker has an approved application forexemption as described in § 404.1075.

Prior to the enactment of OBRA, thesechurch employees, who are treated asself-employed individuals, were subjectto payment of the Self-EmploymentContributions Act tax. We are thereforerevising § 404.1068 to reflect thisstatutory change.


Executive Order 12291The Secretary has determined that

this is not a major rule under ExecutiveOrder 12291 since these regulations willnot result in any significant costs orotherwise meet the criteria for a majorrule. Therefore, a regulatory impactanalysis is not required. The statutoryamendments reflected in these finalregulations will cause a reduction inestimated Social Security tax revenuesof $14 million each for FY 1993, FY1994, and FY 1995.

Paperwork Reduction ActSections 404.1039 and 404.1075 of

these final regulations reflect aninformation collection requirement.That requirement Is contained in section3127 of the Code and is applicable only

to the IRS. The IRS has received OMBapproval to collect the requiredinformation by using form IRS-4029(Application for Exemption from SocialSecurity and Medicare Taxes andWaiver of Benefits, OMB No. 1545-0064).


The Secretary certifies that these finalregulations will not have a significanteconomic impact on a substantialnumber of small entities because theyonly apply to individuals and certainpartnerships. Consequently, theseregulations will have a minimal overalleconomic iinpact and a regulatoryflexibility analysis, as provided inPublic Law 96-354, the RegulatoryFlexibility Act, is not required.(Catalog of Federal Domestic AssistancePrograms: No. 93.802 Social Security-Disability Insurance; No. 93.803 SocialSecurity-Retirement Insurance; No. 93.805Social Security-Survivors Insurance.)


Administrative practice andprocedure, Blind, Disability benefits,Old-Age, Survivors, and DisabilityInsurance, Reporting and recordkeepingrequirements, Social Security.

Dated: June 17, 1993.Louis D. Enoff,Principal Deputy Commissioner of SocialSecurity.


For the reasons set forth in thepreamble, part 404 of chapter III, title 20of the Code of Federal Regulations isamended as follows:

PART 404-FEDERAL OLD-AGE,SURVIVORS AND DISABILITYINSURANCE (1950- )

1. The authority citation for subpart Dof part 404 continues to read as follows:

Authority: Secs. 202, 203 (a) and (b),205(a), 216, 223, 228 (a)-(e), and 1102 of theSocial Security Act; 42 U.S.C. 402,403 (a)and (b), 405(a), 416,423,428 (a)-(e). and1302.

2. Section 404.305 is amended byrevising paragraph (a) to read as follows:

§ 404.305 When you may not be entitled tobenefits.*b e * * *t

(a) Waiver of benefits. If you havewaived benefits and been granted a taxexemption on religious grounds asdescribed in §§ 404.1039 and 404.1075,no one may become entitled to anybenefits or payments on your earningsrecord and you may not be entitled to


benefits on anyone else's earningsrecord; and

3. The authority citation for subpart Eof part 404 continues to read as follows:

Authority: Secs. 202, 203, 204 (a) and (e),205 (a) and (c), 222(b), 223(e), 224, 227, and1102 of the Social Security Act; 42 U.S.C.402, 403, 404 (a) and (e), 405 (a) and (c),422(b), 423(e), 424, 427, and 1302.

4. Section 404.464 is amended byrevising paragraphs (a) and (c) to read asfollows:

§404.464 Nonpayment of benefits whereIndividual Is deported; prohibition againstpayment of lump sum based on deportedIndividual's earnings record&

(a) Old-age or disability insurancebenefits. When an individual isdeported under the provisions of section241(a) of the Immigration andNationality Act (other than underparagraph (1)(C) or (1)(E) thereof), noold-age or disability insurance benefit ispayable to the individual for any monthoccurr ng after the month in which theSecretary is notified by the AttorneyGeneral of the United States that theindividual has been deported and beforethe month in which the individual isthereafter lawfully admitted to theUnited States for permanent residence.An individual is considered lawfullyadmitted for permanent residence as ofthe month he enters the United Stateswith permission to reside herepermanently.

(c) Lump sum death payment. Nolump-sum death payment is payable onthe basis of the earnings of anindividual deported under section241(a) of the Immigration andNationality Act (other than paragraph(1)(C) or (1)(E) thereof) if the individualdies in or after the month in which theSecretary receives notice that he hasbeen deported and before the month inwhich the individual is thereafterlawfully admitted to the United Statesfor permanent residence.

5. The authority citation for subpart Kof part 404 is revised to read as follows:

Authority: Secs. 202(v), 205(a), 209, 210,211, 229(a). 230, 231, and 1102 of the SocialSecurity Act; 42 U.S.C. 402(v), 405(a), 409,410. 411. 429(a), 430, 431, and 1302.

6. A new undesignated centerheadingand § 404.1039 are added to read asfollows-

Exemption From Social Security ByReason of Religious Belief

§ 404.1039 Employers (Includingpartnerships) and employees who are bothmembers of certain religious groupsopposed to Insurance

(a) You and your employer (or, if theemployer is a partnership, each of itspartners) may file applications with theInternal Revenue Service for exemptionfrom your respective shares of theFederal Insurance Contributions Acttaxes on your wages paid by thatemployer if you and your employer (or,if the employer is a partnership, each ofits partners)-

(1) Are members of a recognizedreligious sect or division of the sect; and

(2) Adhere to the tenets or teachingsof the sect or division of the sect and forthat reason are conscientiously opposedto receiving benefits from any private orpublic insurance that-

(i) Makes payment in the event ofdeath, disability, old-age, or retirement;or

(ii) Makes payment for the cost of, orprovides services for, medical careincluding the benefits of any insurancesystem established by the Act.

(b) Both your application and youremployer's application (or, if youremployer is a partnership, eachpartner's application) must be filed withand approved by the Internal RevenueService pursuant to section 3127 of theInternal Revenue Code. An applicationmust contain or be accompanied by theapplicant's waiver of all benefits andpayments under title II and part A oftitle XVIII of the Act. See § 404.305 forthe effect of the filing of the waiver andthe granting of the exemption.

(c) Regardless of whether theapplicant meets all these conditions, theapplication will not be approved unlesswe find that-

(1) The sect or division of the sect hasestablished tenets or teachings whichcause the applicant to beconscientiously opposed to the types ofinsurance benefits described inparagraph (a)(2) of this section; and

(2) For a substantial period of time ithas been the practice for members of thesect or division of the sect to makeprovision for their dependent membersthat is reasonable in view of theirgeneral level of living; and

(3) The sect or division of the sect hasbeen in existence continuously sinceDecember 31, 1950.(d) An application for exemption willbe approved by the Internal RevenueService only if no benefit or paymentunder title II or part A of title XVIII ofthe Act became payable (or, but forsection 203 or section 222(b) of the Act,

would have become payable) to the,applicant at or before the time of thefiling of the application for exemption.

(e) The tax exemption ceases to beeffective with respect to wages paidbeginning with the calendar quarter inwhich either the employer (or if theemployer is a partnership, any of itspartners) or the employee involved doesnot meet the requirements of paragraph(a) of this section or the religious sect ordivision of the sect is found by us to nolonger meet the requirements ofparagraph (c) of this section. If the taxexemption ceases to be effective, thewaiver of the right to receive SocialSecurity and Medicare Part A benefitswill also no longer be effective. Benefitsmay be payable based upon the wagesof the individual, whose exempt statuswas terminated, for and after thecalendar year following the calendaryear in which the event occurred uponwhich the cessation of the exemption isbased. Benefits may be payable basedupon the self-employment income of theindividual whose exempt status wasterminated for and after the taxable yearin which the event occurred uponwhich the cessation of the exemption isbased.

7. Section 404.1068 is amended byrevising paragraph (f) to read as follows:

§404.1068 Employees who are consideredself-employed.

() Employees of a church or church-controlled organization that has electedto exclude employees from coverage asemployment. If you perform servicesthat are excluded from employment asdescribed in § 404.1026, you areengaged in a trade or business. Specialrules apply to your earnings from thoseservices which are known as churchemployee income. If you are paid $100or more in a taxable year by anemployer who has elected to have itsemployees excluded, those earnings areself-employment income (see§ 404.1096(c)(1)). In figuring yourchurch employee income you may notreduce that income by any deductiorsattributable to your work. Your churchemployee income and deductions maynot be taken into account indetermining the amount of other netearnings from self-employment.Effective for taxable years beginning onor after January 1, 1990, your churchemployee income isexempt from self-employment tax under the conditionsset forth for members of certain religiousgroups (see § 404.1075).

8. Section 404.1075 is amended byrevising paragraphs (b) and (d) and byadding paragraph (e) to read as follows:


§404.1075 Members of certain religiousgroups opposed to Insurance.

(b) Your application must be filedunder the rules described in 26 CFR1.1402(h), An application must containor be accompanied by the applicant'swaiver of all benefits and paymentsunder title II and part A of title XVIII ofthe Act. See § 404.305 for the effect ofthe filing of the waiver and the grantingof the exemption.

(d) Your application for exemptionwill be approved by the InternalRevenue Service only if no benefit orother payment under title II or part A oftitle XVIII of the Act became payable or.but for section 203 or section 222(b) of -

'

the Act, would have become payable, toyou or on your behalf at or before thetime of the filing of your application forexemption.

- (e) The tax exemption ceases to beeffective for any taxable year endingafter the time you do not meet therequirements of paragraph (a) of thissection or after the time we find thereligious sect or division of the sect ofwhich you are a member no longermeets the requirements of paragraph (c)of this section. If your tax exemptionceases to be effective,* your waiver of theright to receive Social Security andMedicare part A benefits will also nolonger be effective. Benefits may bepayable based upon your wages for andafter the calendar year following thecalendar year in which the eventoccurred upon which the cessation ofthe exemption Is based. Benefits may bepayable based upon your self-employment income for and after thetaxable year in which the eventoccurred upon which the cessation ofthe exemption is based.(FR Doc. 93-30150 Filed 12-9-93; 8:45 am]BILUNO COOE 419029-P

20 CFR Part 404

[Regulations No. 4]

RIN 0960-AD31

Federal Old-Age, Survivors andDisability Insurance; ContinuedEntitlement to Benefits of DeemedSpouse and Legal Spouse; Treatmentof Divorce in Invalid Marriage;Treatment of Multiple EntitlementsUnder the Family Maximum

AGENCY: Social Security Administration,HHS.ACTION: Final rule.

SUMMARY: We are revising several rulesto reflect statutory enactments that

permit the simultaneous entitlement ofa spouse based on a "deemed" validmarriage and a spouse based on a validor a "putative" marriage and providethat when a putative spouse and/or adeemed spouse is/are entitledsimultaneously with a spouse based ona valid marriage, the spouse based onthe valid marriage is paid outside thefamily maximum. We are furtherrevising our rules to reflect section203(a)(3)(C) of the Social Security Actwhich provides that an individualentitled to divorced spouses' benefits isalso paid outside the family maximum.EFFECTIVE DATE: These rules are effectiveDecember 10, 1993. -

FOR FURTHER INFORMATION CONTACT:Lawrence V. Dudar, Legal Assistant,Office of Regulations. Social SecurityAdministration, 3-B-1 OperationsBuilding, 6401 Security Boulevard, -

Baltimore, Maryland 21235, (410) 965-1759.SUPPLEMENTARY INFORMATION: Section5119 of the Omnibus BudgetReconciliation Act of 1990 (OBRA1990), Public Law (Pub. L.) 101-508,contains several amendments to section216(h)(1) of the Social Security Act (theAct) which permit the simultaneousentitlement to benefits under title II ofthe Act of a spouse, widow(er), divorcedspouse, surviving divorced spouse,mother/father or surviving divorcedmother/father based on a deemed validmarriage (i.e., a ceremonial marriageentered into in good faith that is invalidbecause of the existence of a legalimpediment) and a spouse, widow(er)divorced spouse, surviving divorcedspouse, mother/father, or survivingdivorced mother/father based on a validmarriage or a putative marriage (i.e., aninvalid marriage that is recognizedunder State law for inheritancepurposes).

Prior to the enactment of section 5119of OBRA 1990, a deemed spouse couldreceive benefits only if no legal orputative spouse was receiving benefitson the worker's earnings record.

A secondary result of the OBRA 1990legislation was to limit the effect ofacquiescence rulings in Rosenberg v.Richardson as reaffirmed by Capitano v.Secretary of HHS, AR 86-2R(2). andWoodson v. Schweiker, AR 86-18R(5)and AR 86-19R(11), to benefits payableprior to January 1991. These rulingspermit the entitlement or continuedentitlement of a deemed spouse wherethe full benefit is not payable to thelegal spouse and allow a deemed spouseto become entitled despite the priorentitlement of the legal spouse. TheOBRA 1990 amendments are moregenerous to beneficiaries than the

Rosenberg, Capitano, and Woodsondecisions were.

To reflect the amendments made tosection 216(h)(1) of the Act by section5119 of OBRA 1990, we are amendingour regulations as follows:

We are amending § 404.331 withregards to entitlement to wife's orhusband's benefits as a divorced spouseto reflect that a deemed valid marriagemeets the 10-year duration of marriagerequirement for divorced and survivingdivorced spouses.

We are amending § 404.332, whichsets out our rules as to when wife's andhusband's benefits begin and end, toremove the provision which requiredthe termination of the entitlement of aspouse or divorced spouse based on adeemed valid marriage if a spouse ordivorced spouse based on a validmarriage or a putative marriage becameentitled to benefits on the same worker'srecord.

We are amending § 404.336, whichdiscusses entitlement to widow's orwidower's benefits as a survivingdivorced spouse, to reflect that

ayments under this section may beased on a deemed valid marriage.We are amending § 404.337, which

sets out our rules as to when widow'sand widower's benefits begin and end,to remove the provision which requiredthe termination of the entitlement of awidow or widower based upon adeemed valid marriage when a personbecomes entitled to benefits on the sameworker's record based upon a validmarriage or a putative marriage underState law as explained in § 404.345.

We are amending § 404.340, whichdescribes entitlement to mother's orfather's benefits as a surviving divorcedspouse, to reflect that payments underthis section may be based on a deemedvalid marriage.

We are amending § 404.341, whichsets out our rules as to when mother'sand father's benefits begin and end, toremove the provision which requiredthe termination of mother's or father'sbenefits based upon a deemed validmarriage when another person becomesentitled to mother's or father's benefitson the same worker's record based upona valid marriage or a putative marriageunder State law as explained in§ 404.345.

We are amending § 404.346 regardingthe relationship of certain individualsbased upon a deemed valid marriage toremove the provision which precludedthe entitlement of a wife, husband,widow, or widower based upon adeemed valid marriage when anotherperson was entitled on the sameworker's record as a wife, husband,widow, widower-based upon a valid


marriage or a putative marriage underState law as explained in § 404.345. Weare further amending § 404.346 toindicate that once a marriage has beendeemed to be a valid marriage, it shallcontinue to be deemed valid if theinsured and the person entitled tobenefits as a spouse are no longer livingtogether when the insured dies.

Section 5119 of OBRA 1990 alsoamended section 203(a) of the Act. Weare amending the family maximumprovision set out in § 404.403 to reflectthis amendment to Indicate that aspouse, widow(er) or mother/fatherbased upon a deemed valid marriageand/or a marriage recognized underState law for inheritance rights will bepaid within the family maximumpayable, whereas the spouse, widow(er)or mother/father based on a validmarriage will be paid outside the familymaximum when a spouse of a deemedvalid marriage or a putative marriage isentitled simultaneously with a spousebased on a valid marriage on the sameworker's record.

We are further amending § 404.403 toreflect our current practice undersection 203(a)(3)(C) of the Act, whichprovides that an individual entitled todivorced spouses' benefits under section202 (b) or (c) of the Act or survivingdivorced spouses' benefits under section202 (a) or () of the Act is also paidoutside of the family maximum.

Section 5119 of OBRA 1990 iseffective with respect to benefits formonths after December 1990. Inaddition, unless the spouse of a deemedvalid marriage was entitled on the sameearnings record to a benefit undersections 202 (b), (c), (e), or (f) of the Actfor December 1990, he or she must filean application after December 31, 1990,to obtain the benefit of section 5119 ofOBRA 1990.Regulatory Procedures

The Department, even when notrequired by statute, as a matter of policygenerally follows the Administrative.Procedure Act (APA) notice of proposedrulemaking and public commentprocedures specified In 5 U.S.C. 553 inthe development of its regulations. TheAPA provides exceptions to its noticeand public comment procedures whenan agency finds that there is good causefor dispensing with such procedures onthe basis that they are impracticable,unnecessary, or contrary to the publicinterest. We have determined that,under 5 U.S.C. 553(b)(B), good causeexists for waiver of notice of proposedrulemaking and public commentprocedures in these regulations becausewe are only reflecting statutory changeswhich are not discretionary and do not

Involve the setting of any policy.Therefore, we have determined thatopportunity for prior public comment isunnecessary. Consequently, theseamendments are being issued as a finalrule.


The Secretary has determined thatthis is not a major rule under ExecutiveOrder 12291 because these regulationswill not result in any significant costs orotherwise meet the criteria for a majorrule. We estimate the program costs tobe $5 million in FY 1992, $11 millionin FY 1993, $15 million in FY 1994 and$16 million in FY 1995 with negligibleassociated administrative costs.Therefore, a regulatory impact analysisis not required.


These final regulations impose noadditional reporting and recordkeepingrequirements subject to Office ofManagement and Budget clearance.


The Secretary certifies that these finalregulations will not have a significanteconomic impact on a substantialnumber of small entities because theyaffect only individuals. Therefore, aregulatory flexibility analysis asprovided in Pub. L. 96-354, theRegulatory Flexibility Act, is notneeded.(Catalog of Federal Domestic AssistancePrograms: No, 93.802 Social SecurityDisability Insurance; No. 93.803 SocialSecurity Retirement Insurance)List of Subjects in 20 CFR Part 404

Administrative practice andprocedure, Blind, Disability benefits,Old-Age, Survivors, and DisabilityInsurance, Reporting and recordkeepingrequirements, Social Security.

Dated: July 26, 1993.Lawrence IL Thompson,Principal Deputy Commissioner of SocialSecurity.


Part 404 of chapter III, title 20 of theCode of Federal Regulations is amendedas follows:

PART 404-FEDERAL OLD-AGE,SURVIVORS AND DISABILITY

-INSURANCE (1950- )

Subpart D-Old-Age, Disability,Dependents' and Survivors' InsuranceBenefits; Period of Disability


Authority: Secs. 202, 203 (a) and (b),205(a), 216, 223, 228(a)-(e), and 1102 of theSocial Security Act; 42 U.S.C. 402, 403 (a)and (b), 405(a), 416, 423, 428(a)-(e) and1302.

2. Section 404.331 is amended byrevising paragraph (a)(1) to read asfollows:

J 404.331 Who Is entitled to wife's orhusband's benefits as a divorced spouse.* * * * *

(a) * * *(1) You were validly married to the

insured under State law as described in§ 404.345 or you were deemed to bevalidly married as described in§ 404.346; and* * *' * *

3. Section 404.332 is amended byrevising paragraph (b)(6) to read asfollows:

§404.332 When wife's and husband'sbenefits begin and end.* * * * *

(b)*(6) If your benefits are based upon a

deemed valid marriage and you havenot divorced the Insured, you marrysomeone other than the insured.* * * * *

4. Section 404.336 is amended byrevising paragraph (a)(1) to read asfollows:

§ 404.336 Who Is entitled to widow's orwidower's benefits as a surviving divorcedspouse.* * * * *

(a) * *(1) You were validly married to the

insured under State law as described in§ 404.345 or are deemed to be validlymarried as described in § 404.346; and* * * * *

5. Section 404.337 is amended byremoving paragraph (b)(3) andredesignating former paragraph (b)(4) asparagraph (b)(3).

6. Section 404.340 is amended byrevising the introductory text ofparagraph (a) to read as follows:

§ 404.340 Who Is entitled to mother's or.father's benefits as a surviving divorcedspouse.

(a) You were validly married to theinsured under State law as described in§ 404.345 or you were deemed to bevalidly married as described in§ 404.346 but the marriage ended in afinal divoi'e and-

7. Section 404.341 is amended byremoving paragraph (b)(4),,redesignatingparagraph (b)(5) as new paragraph (b)(4)and removing in paragraph (c) the


reference "(4) or (5)" and adding in itsplace "or (4)".

8. Section 404.346 is amended byrevising paragraph (b) to read as follows:

§ 404.346 Your relationship as wife,husband, widow, or widower based upon adeemed valid marriage.

(b) Entitlenint based upon a deemedvalid marriage. To be entitled to benefitsas a wife, husband, widow or widoweras the result of a deemed valid marriage,you and the insured must have beenlving in the same household (see§ 404.347) at the time the insured diedor, if the insured is living, at the timeyou apply for benefits. However, amarriage that had been deemed valid,shall continue to be deemed valid if theinsured individual and the personentitled to benefits as the wife orhusband of the insured individual areno longer living in the same householdat the time of death of the insuredindividual.

Subpart E-Deductions; Reductions;and Nonpayments of Benefits

9. The authority citation for SubpartE of Part 404 continues to read asfollows:

Authority: Secs. 202. 203, 204(a) and (e).205(a) and (c), 222(b), 223(e), 224, 227, and1102 of the Social Security Act; 42 U.S.C.402, 403, 404(a) and (e), 405(a) and (c),422(b), 423(e), 424,427, and 1302.

10. Section 404.403 is amended byadding new paragraphs (a)(3) and (4) toread as follows:

§404.403 Reduction where total monthlybenefits exceed maximum family benefitspayable.

(a) * * *(3) The benefits of an individual

entitled as a divorced spouse orsurviving divorced spouse will not bereduced pursuant to this section. Thebenefits of all other individuals entitledon the same record will be determinedunder this section as if no such divorcedspouse or surviving divorced spousewere entitled to benefits.

(4) In any case where more than oneindividual is entitled to benefits as thespouse or surviving spouse of a worker.for the same month, and at least one ofthose individuals is entitled based on amarriage not valid under State law (see§§ 404.345 and 404.346), the benefits ofthe Individual whose entitlement isbased on a valid marriage under Statelaw will not be reduced pursuant to thissection. The benefits of all otherIndividuals entitled on the same record(unless excluded by paragraph (a)(3) ofthis section) will be determined under

this section as if such validly marriedindividual were not entitled to benefits.

[FR Doc. 93-30154 Filed 12-9-93; 8:45 am]BnLJNG CODE 410-2-P

20 CFR Part 416

RIN 0960-AC??

Supplemental Security Income for theAged, Blind, and Disabled;Redeterminatlons of SupplementalSecurity income Eligibility

AGENCY: Social Security Administration,HHS.ACTION: Findl rules.

-SUMMARY: These final regulations amendthe policy on how we establish thebeginning of the supplemental securityincome (SSI) redetermination periodwhen reviewing a recipient's eligibilityto ensure that he or she continues to beeligible and receives the correct SSIbenefit amount. This new policyeliminates gaps that occur in theredetermination process under currentregulations. The effects of these finalregulations are administrativesimplification and increased paymentaccuracy.EFFECTIVE DATE: December 10, 1993.FOR FURTHER INFORMATION CONTACT:Duane Heaton, Legal Assistant, 3-B-1Operations Building, 6401 SecurityBoulevard, Baltimore, MD 21235, (410)965-8470.


BackgroundSection 1611(c)(1) of the Social

Security Act (the Act) provides thateligibility for and the amount of SSIbenefits shall be redetermined at suchtime or times as may be provided by theSecretary of Health and Human Servicep(the Secretary). Regulations at§ 416.204(c) state the period for whicha redetermination applies by explainingwhich months the first and subsequentredetermination periods include.

These regulations currently providethat the first redetermination periodincludes: (1) The month in which wemake the redetermination, (2) all themonths after the month of firsteligibility, and (3) future months untilthe second redetermination.

The current regulations furtherprovide that subsequentredetermination periods include: (1)The month in which we make theredetermination, (2) all the months afterthe last time we made a

redetermination, and (3) future monthsuntil the next redetermination.

These current regulations do notprovide for the consideration of allfactors of eligibility for the entirerelevant period because the reviewperiod does not begin with the first dayof the month of the last determinationof eligibility.

The redetermination period, therefore,omits a month or part o a month.Factors which could affect continuedeligibility or payment amountspotentially go undetected. For example:The last redetermination review periodwas initiated on September 4, 1989. Thenext redetermination period of reviewincludes all months after the month welast initiated a redetermination; i.e., itbegins October 1, 1989. As a result, theperiod September 5 through September30, 1989, is never reviewed to see if theindividual was eligible for that period orif he or she was receiving the correct SSIbenefit amount.

Final Regulations

We are amending the regulations at§ 416.204(c)(1)(ii) to Include in the firstredetermination period all monthsbeginning with the first day of: the mostrecent month of eligibility/re-eligibility;or application; or deferred/updateddevelopment (applicable whennonmedical issues in a disability caseare not fully developed until a disabilityallowance is made).

In addition, we are amending§ 416.204(c)(2)(ii) to include insubsequent redetermination periods allmonths beginning with the first day ofthe month the last redetermination wasinitiated.

Comments

These regulations were published as aNotice of Proposed Rulemaking onNovember 20, 1992 (57 FR 54732). A 60-day comment period was provided. Wereceived one public comment whichwas from an organization. This publiccomment supported the regulations anddid not raise any issues. We are,therefore, adopting the regulations asproposed.


Executive Order No. 12291

The Secretary has determined thatthis is not a major rule under ExecutiveOrder 12291. The program savings andthe administrative costs will beinsignificant and are estimated at lessthan $1 million a year. Therefore, aregulatory impact analysis is notrequired.



We certify that these regulations willnot have a significant economic impacton a substantial number of smallentities. Therefore, a regulatoryflexibility analysis as provided in Pub.L. 96-354, the Regulatory FlexibilityAct, is not required.


These regulations impose noadditional reporting and recordkeepingrequirements subject to Office ofManagement and Budget clearance.(Catalog of Federal Domestic Assistance:Program No. 93.807-Supplemental SecurityIncome)

List of Subjects in 20 CFR Part 416Administrative practice and

procedure, Aged, Blind, Disabilitybenefits, Public assistance programs,Reporting and recordkeepingrequirements, Supplemental SecurityIncome.

Dated: August 19. 1993.Lawrence H. Thompson,Principal Deputy Commissioner of SocialSecurity.

Approved: October 4, 1993.Donna . Shalala.Secretary of Health and Human Services.

For the reasons set out in thepreamble, part 416 of title 20 of theCode of Federal Regulations is amendedas follows:

PART 416--AMENDED]

1. The authority citation for part 416,subpart B continues to read as follows:

Authority: Secs. 1102,1110(b), 1602. 1611,1614,1615(c), 1619(a), 1631' and 1634 of theSocial Security Act; 42 U.S.C. 1302, 1310(b),1381a, 1382, 1382c, 1382d(c), 1382h(a), 1383,and 1383c; secs. 211 and 212 of Pub. L 93-66, 87 Stat. 154 and 155; sec. 502(a) of Pub.L 94-241, 90 Stat. 268; and sec. 2 of Pub.L. 99-643, 100 Stat 3574.

2. In § 416.204, paragraphs (c)(1)(ii)and (c)(2)(ii) are revised to read asfollows:

§ 416.204 Redeteminations of SSIeligibility.* * * a *

(c) *(1)*

(ii) All months beginning with thefirst day of the latest of the following:

(A) The month of first eligibility or re-eligibility; or

(B) The month of application; or(C) The month of deferred or updated

development; and(* a * a(2) a a a

(ii) All months beginning with thefirst day of the month the lastredetermination was initiated; and* * * * *

[FR Doc. 93-30151 Filed 12-9-93; 8:45 am]BILLING GOOE 4190-9-P

20 CFR Part 416

RIN 0960-AD60

Supplemental Security IncomeMaximum Payment Limit ($30) WhenMedicaid Is Not Paying Toward theCost of Institutional Care Because theIndividual Transferred a Resource


SUMMARY: These final regulations reflectamendments to the Social Security Act(the Act) made by section 303(c)(2) ofthe Medicare Catastrophic Coverage Actof 1988. The Act, as amended by thatsection, provides, for supplementalsecurity income (SSI) purposes, that thereduced SSI payment rate of $360 a year($720 for a couple) which is applied toresidents of certain medical carefacilities which are receiving Medicaidpayments for the cost of care of thoseresidents, must also be applied toresidents for whom Medicaid paymentsare denied because they transferred aresource for less than fair market value.EFFECTIVE DATE: These rules are effectiveon December 10, 1993.FOR FURTHER INFORMATION CONTACT:Lawrence V. Dudar, Office ofRegulations, Social SecurityAdministration, 6401 SecurityBoulevard, Baltimore, MD 21235, (410)965-759.


BackgroundPublic Law 100-360, the "Medicare

Catastrophic Coverage Act of 1988," wasenacted on July 1, 1988. Section303(c)(2) of this law amended section1611(e)(1)(B) of the Act and providesthat the reduced SSI payment rate of$360 a year ($720 for a couple) whichis applied to residents of certainmedical care facilities which arereceiving Medicaid payments for thecost of care of those residents, must alsobe applied to residents for whomMedicaid payments are denied becausethey transferred a resource for less thanfair market value. In these finalregulations, we are reflecting thisstatutory change.

Prior to enactment of Public Law 100-360, the SSI payment amount wasreduced to $360 a yaar for individuals

and to $720 a year for couples inmedical care facilities only when morethan 50 percent of the cost of their carewas paid under a State plan approvedunder title XIX of the Act (Medicaid).Under Medicaid rules, if an individualapplying for or receiving nursing facilityservices or their equivalent disposes ofresources for less than fair market value,with some exceptions, Medicaid willnot cover the cost of such services fora period of time. See section 1917(c) ofthe Act. Since the general Medicaid rulerequired the denial or suspension of thisassistance when such a disposal ofresources occurred and the reduced SSIpayment amounts were used only ifMedicaid contributed to the cost of theinstitutional medical care, an SSIclaimant in a private medical carefacility who disposed of resources forless than fair market value and becameineligible for Medicaid prior to theenactment of Public Law 100-360 couldhave been eligible for an unreduced SSIpayment amount. On the other hand,under section 1611(e)(1){A) of the Act,an SSI claimant in a public medical carefacility who became ineligible forMedicaid on this basis, would havebecome ineligible for SSI altogether.Section 1611(e)(1)(B) of the Act, asamended by section 303(c)(2) of PublicLaw 100-360, addressed the anomalypresented by the private institutionsituation and the elimination of SSI inthe public institution situation byproviding that the same reduced benefitrate must be applied when Medicaidpayments are not being made because ofthe provisions of section 1917(c) of theAct which preclude Medicaidcontributions for the costs of certaintypes of care when the individualtransferred a resource for less than fairmarket value.

We are amending § 416.414 of theregulations to reflect the changes madeby Public Law 100-360 to section1611(e)(1)(B) of the Act. Specifically,§ 416.414 is being amended to providethat the reduced benefit rate will applyto individuals who are in medical carefacilities and for whom Medicaid is notpaying more than 50 percent of the costof care because of application of theprovisions of section 1917(c),of the Act.


Justification for Final Rules

The Department, even when notrequired by statute, as a matter ofpolicy, generally follows theAdministrative Procedure Act (APA)notice of proposed rulemaking andpublic comment procedures specified in5 U.S.C. 553 in the development of itsregulations. The APA provides


exceptions to its notice and commentprocedures when an agency finds thereis good cause for dispensing with suchprocedures on the basis that they areimpracticable, unnecessary. or contraryto the public Interest. We havedetermined that under 5 U.S.C.553(b)(B), good cause exists for waiverof proposed rulemaking and publiccomment procedures because suchrulemaking is unnecessary. These rulesmerely reflect, without exercise ofdiscretion, the provisions of sections1611(e)(1)(B) of the Act as amended bysection 303(c)(2) of Public Law 100-360,which are effective with respect to anyperiods of Medicaid ineligibility basedon transfers of assets occurring on orafter July 1, 1988.

Executive Order No. 12291The Secretary has determined that

this is not a major rule under ExecutiveOrder 12291 because there are noprogram costs or administrative savingsassociated with these regulations andthe threshold criteria for a major rule arenot otherwise met. Therefore, aregulatory impact analysis is notrequired.Paperwork Reduction Act

These final regulations impose noadditional reporting and recordkeepingrequirements necessitating clearance bythe Office of Management and Budget.Regulatory Flexibility Act

We certify that these final regulationswill not have a significant economicimpact on a substantial number of smallentities because they affect onlyindividuals. Therefore, a regulatoryflexibility analysis as provided in PublicLaw 96-354, the Regulatory FlexibilityAct, is not required.(Catalog of Federal Domestic AssistanceProgram No. 93.807. Supplemental SecurityIncome)


procedure, Aged, Blind, Disabilitybenefits, Public assistance programs.Reporting and recordkeepingrequirements, Supplemental securityincome.

Dated: July 23, 1993.Lawrence IL Thompson,Principal Deputy Commissioner of SocialSecurity.


For the reasons set out in thepreamble, title 20, chapter III, part 416of the Code of Federal Regulations isamended as follows:

PART 416-[AMENDED]


Authority: Secs. 1102, 1611(a), (b), (c), and(e), 1612. 1617, and 1631 of the SocialSecurity Act; 42 U.S.C. 1302, 1382 (a), (b),(c). and (e), 1382a. 1382f, and 1383.

2. Section 416.414 is amended byrevising the introductory text ofparagraph (a) and paragraph (a)(2) toread as follows:

§416.414 Amount of benefits; eligibleIndividual or eligible couple In a medicalcare facility.

(a) General rule. There is a reducedSSI benefit rate for persons who are inmedical care facilities where more than50 percent of the cost of their care ispaid under a State plan approved undertitle XIX of the Social Security Act(Medicaid). This reduced SSI benefitrate also applies to persons who are inmedical care facilities where more than50 percent of the cost of care wouldhave been paid under an approvedMedicaid State plan but for theapplication of section 1917(c) of the Actdue to a transfer of assets for less thanfair market value. Persons to whom thisbenefit rate applies are-

(2) Those who reside for part of amonth in a public institution and for therest of the month are In a public orprivate medical care facility whereMedicaid pays or would have paid (butfor the application of section 1917(c) ofthe Act) more than 50 percent of thecost of their care.

IFR Doc. 93-30155 Filed 12-9-93; 8:45 am]BILLING CODE 4190-2-

Food and Drug Administration

21 CFR Part 178

(Docket No. 91 F-04801

Indirect Food Additives: Adjuvants,Production Aids, and Sanitizers

AGENCY: Food and Drug Administration,HHS.

ACTION: Final rule.

SUMMARY: The Food and DrugAdministration (FDA) is amending thefood additive regulations to provide forthe safe use of 1,1-difluoroethane as a.blowing agent in the production ofpolystyrene articles intended to contactfood. This action is in response to apetition filed by E.I. duPont de Nemoursand Co.. Inc.

DATES: Effective December 10, 1993;written objections and requests for ahearing by January 10. 1994.ADDRESSES: Submit written objections tothe Dockets Management Branch (HFA-305), Food and Drug Administration,rm. 1-23, 12420 Parklawn Dr.,Rockville, MD 20857.FOR FURTHER INFORMATION CONTACT:Daniel N. Harrison, Center for FoodSafety and Applied Nutrition (HFS-216), Food and Drug Administration,200 C St. SW., Washington, DC 20204,202-254-9500.SUPPLEMENTARY INFORMATION: In a noticepublished in the Federal Register ofJanuary 3, 1992 (57 FR 291), FDAannounced that a food additive petition(FAP 2B4303) had been filed by E.I.duPont de Nemours and Co., Inc.,Wilmington, DE 19898. The petitionproposed that § 178.3010 Adjuvantsubstances used in the manufacture offoamed plastics (21 CFR 178.3010) beamended to provide for the safe use of1,1-difluoroethane as a blowing agent inthe production of polystyrene articlesintended to contact food.

FDA has evaluated data in thepetition and other relevant material. Theagency concludes that the proposedfood additive use is safe, and that 21CFR 178.3010 should be amended as setforth below.

This action will permit manufacturersof foamed polystyrene articles forcontact with all food types to substitute1.1-difluoroethane for the currentlyused hydrochlorofluorocarbon-22(HCFC-22), which, because of its ozonedepletion properties, is scheduled to bephased out of all noninsulating foamapplications by January 1, 1994. Duringits review of the petition, FDAconsulted with the U.S. EnvironmentalProtection Agency (EPA) to determinewhether FDA approval of this petitionwould be consistent with EPA's effortsto control hydrochlorofluorocarbons(HCFC's). OnSeptember 25, 1992, EPAadvised FDA that approval of 1,1-difluoroethane as an alternative blowingagent in food service foam packaging isconsistent with the Clean Air ActAmendments of 1990 under section 610,Non-Essential Products ContainingChlorofluorocarbons, which mandatedthat HCFC's are to be phased out of allnoninsulating foam applications byJanuary 1, 1994.

EPA further advised FDA that EPA isconducting risk assessments of HCFCalternatives under section 612 of theClean Air Act Amendments of 1990, theSignificant New Alternatives Policy(SNAP). The SNAP program hasevaluated 1,1 difluoroethane and foundit to be an environmentally appropriate


substitute for HCFC-22 in noninsulatingfoam blowing. EPA further advised that1,1-difluoroethane creates nooccupational exposure concerns, is notan ozone depleter nor a significantglobal warming substance, and is aneffective substitute in this application.

In accordance with § 171.1(h) (21 CFR171.1(h)), the petition and thedocuments that FDA considered andrelied upon in reaching its decision toapprove the petition are available forinspection at the Center for Food Safetyand Applied Nutrition by appointmentwith the information contact personlisted above. As provided in 21 CFR171.1(h), the agency will delete from thedocuments any materials that are notavailable for public disclosure beforemaking the documents available forinspection.SThe agency has carefully consideredthe potential environmental effects ofthis action. FDA has concluded that theaction will not have a significant impacton the human environment, and that anenvironmental impact statement is notrequired. The agency's finding of nosignificant impact and the evidencesupporting that finding, contained in anenvironmental assessment, may be seenin the Dockets Management Branch(address above) between 9 a.m. and 4p.m., Monday through Friday.

Any person who will be adverselyaffected by this regulation may at anytime on or before January 10, 1994, filewith the Dockets Management Branch(address above) written objectionsthereto. Each objection shall beseparately numbered, and eachnumbered objection shall specify withparticularity the provisions of theregulation to which objection is madeand the grounds for the objection. Eachnumbered objection on which a hearingis requested shall specifically so state.Failure to request a hearing for anyparticular objection shall constitute awaiver of the right to a hearing on thatobjection. Each numbered objection forwhich a hearing is requested shallinclude a detailed description andanalysis of the specific factualinformation intended to be preser"tcd insupport of the objection in the eventthat a hearing is held. Failure to includesuch a description and analysis for anyparticular objection shall constitute awaiver of the right to a hearing on theobjection. Three copies of all documentsshall be submitted and shall beidentified with the docket numberfound in brackets in the heading of thisdocument. Any objections received inresponse to the regulation may be seenin the Dockets Management Branchbetween 9 a.m. and 4 p.m., Mondaythrough Friday.


Food additives, Food packaging.Therefore, under the Federal Food,

Drug, and Cosmetic Act and underauthority delegated to the Commissionerof Food and Drugs and redelegated tothe Director, Center for Food Safety andApplied Nutrition, 21 CFR part 178 isamended as follows:

PART 178-INDIRECT FOODADDITIVES: ADJUVANTS,PRODUCTION AIDS, AND SANITIZERS


Authority: Secs. 201, 402,409, 721 of theFederal Food, Drug, and Cosmetic Act (21.U.S.C. 321, 342, 348, 379e).

2. Section 178.3010 is amended in thetable by alphabetically adding a newentry under the headings "List ofsubstances" and "Limitations" to readas follows:

§ 178.3010 Adjuvant substances used Inthe manufacture of foamed plastics.

List of substances Limitations

1,1-Difluoroethane For use as a blowing(CAS Reg. No. 75- agent in poly-37-6). styrene.

Dated: December 3, 1993.L. Robert Lake,Acting Director, Center for Food Safety andApplied Nutrition.[FR Doc. 93-30190 Filed 12!-9-93: 8:45 amlBILUtNG CODE 4160-1-F


Federal Highway Administration

23 CFR Part 625

[FHWA Docket No. 93-141

RIN 2125-AD23

Design Standards for Highways;Interim Selected Metric Values forGeometric Design

AGENCY: Federal HighwayAdministration (FHWA), DOT.ACTION: Interim final rule; request forcomments.

SUMMARY: The FHWA is adopting, as itsinterim policy for the geometric designof projects on the National HighwaySystem (NHS), a 1993 AmericanAssociation of State Highway andTransportation Officials' (AASHTO)publication entitled "Interim Selected

Metric Values for Geometric Design, AnAddendum to A Policy on GeometricDesign of Highways and Streets, 1990."The FHWA requests comments on thisaction.

The FHWA's Metric ConversionPolicy, published in the FederalRegister on June 11, 1992, provides thatnewly authorized Federal-aidconstruction contracts must be only inmetric units by September 30, 1996.Because of the long lead times requiredfor highway construction projects,planning for 1996 projects is alreadyunderway. It is the intent of thisrulemaking to assure the States andother FHWA partners that the metricconversions used to formulate theirplans will match the FHWA'sconversions.DATES: This regulation is effectiveJanuary 10, 1994. Comments must bereceived on or before March 10, 1994.The incorporation by reference of acertain publication listed in theregulation is approved by the Director ofthe Federal Register as of January, 10,1994.ADDRESSES: Submit written, signedcomments to FHWA Docket No. 93-14,Federal Highway Administration, room4232, HCC-10, 400 Seventh Street SW.,Washington, DC 20590. All commentsreceived will be available forexamination at the above addressbetween 8:30 a.m. and 3:30 p.m., e.t.,Monday through Friday. Those desiringnotification of receipt of comments mustinclude a self-addressed, stampedpostcard. The current design standardsand interim metric values are on file atthe Office of the Federal Register inWashington, DC, and are available forinspection and copying from the FHWAWashington Headquarters and allFHWA Division and Regional Offices asprescribed in 49 CFR part 7, appendixD. Copies of the current AASHTOpublications are also available forpurchase from the AmericanAssociation of State Highway andTransportation Officials, suite 225, 444North Capitol Street NW., Washington,DC 20001.FOR FURTHER INFORMATION CONTACT: Mr.Seppo I. Sillan, Geometric and RoadsideDesign Branch, Federal-Aid and DesignDivision, Office of Engineering (202)366-0312, or Mr. Wilbert Baccus, Officeof the Chief Counsel (202) 366-0780,Federal Highway Administration, 400Seventh Street SW., Washington, DC20590. Office hours are from 7:45 a.m.to 4:15 p.m., e.t., Monday throughFriday, except legal Federal holidays.SUPPLEMENTARY INFORMATION: Thestandards, policies, and standardspecifications that have been approved


by the FHWA for application on allFederal-aid highway projects areincorporated by reference in 23 CFRpart 625.

The American Association of StateHighway and Transportation Officials(AASHTO) is an organization whichrepresents the 52 State highway andtransportation agencies (including theDistrict of Columbia and Puerto Rico).Its members consist of the dulyconstituted heads and other chiefofficials of those 52 agencies. TheSecretary of the United StatesDepartment of Transportation (DOT) isan ex officio member, and DOT officialsparticipate in various AASHTOactivities as non-voting representatives.Among other functions, the AASHTOdevelops and issues standards,specifications, policies, guides, andrelated materials for use by the Statesfor highway projects. Many of thestandards, policies, and standardspecifications approved by the FHWAand incorporated in 23 CFR part 625were developed and issued by theAASHTO. Revisions made to suchdocuments by the AASHTO areindependently reviewed and adopted bythe FHWA before they are applied toprojects on the NHS.

The FHWA initiated a phased fiveyear plan to convert its activities andbusiness operations to the metric systemof weights and measures as required bythe Metric Conversion Act of 1975 (Pub.L. 94-168, 89 Stat. 1007) as amended bythe Omnibus Trade andCompetitiveness Act of 1988 (Pub. L.100-418, 102 Stat. 1107, 1451) (MetricAct). Section 3 of this Act set a deadlinedate of September 30, 1992. for eachFederal government agency to beginusing the International System of Units(SI) in procurements, grants, and otherbusiness-related activities, except to theextent that such use is impractical orwould likely cause significantinefficiencies or loss of markets toUnited States firms.

In order to comply with the MetricAct, the FHWA developed a list ofrequired deadlines for converting to themetric system which was published onJune 11, 1992, at 57 FR 24843. Thisnotice established that all newlyauthorized Federal-aid contracts mustuse only'metric units by September 30,1996. In order to comply with the abovedeadline, and because it often takes'several years between the time whendesigns are initiated and when projectsare authorized, States must begin in thenear future to design projects using themetric system. Accordingly, theAASHTO developed and published"Interim Selected Metric Values forGeometric Design," listing the

conversion values for nationwideuniformity. Through this rulemaking theFHWA is proposing to adopt the metricconversion geometric values establishedby the AASHTO in the publicationentitled "Interim Selected Metric Valuesfor Geometric Design." Included aremetric values for use in design speed,running speed, lane width, shoulderwidth, vertical clearance, certain clearzones, curb heights, definition of highspeed/low speed highways, criteria forestablishing stopping and passing sightdistance, the way horizontal curvatureis calculated, and in the definition oflong bridges.

Review ProcedureBased on an analysis of public

comments received, the FHWA willreexamine its determination that theAASHTO publication adopted by thisrule is acceptable as the basis for thedesign of highways on the NHS.Rulemaking Analysis and Notices

The Administrative Procedure Act(APA), 5 U.S.C. 551 et seq., allowsagencies engaged in rulemaking todispense with prior notice andopportunity for comment when theagency for good cause finds that suchprocedures are impracticable,unnecessary, or contrary to the publicinterest. 5 U.S.C. 553(b)(3)(B). For thereasons set forth below, the FHWA hasdetermined that prior notice to thepublic on this action is unnecessary andcontrary to the public interest.

The FHWA has determined that priornotice to the public is unnecessarybecause the AASHTO interim metricvalues document being adopted in thisrulemaking mirrors, to the extentpossible, the English measurementscontained in the AASHTO publication,"A Policy 'on Geometric Design ofHighways and Streets, 1990" (PGDHS),adopted by the FHWA in a final rulepublished on April 29, 1993 (58 FR25939). If the exact equivalents of thedesign standards had been used, themetric measurements would have had tobe carried out to as many as six decimalplaces. Otherwise, the design standardsthemselves would have had to besignificantly raised or lowered in orderto accommodate "round" metricmeasurements. Instead, in drafting itsmetric document, the AASHTO"rounded off" the Englishmeasurements contained in the PGDHSin order to allow easier conversions tometric measurements.

We expect these particular metricvalues to be used on an interim basisonly. It is anticipated that theAASHTO's revised PGDHS, withgeometric design values converted to

the metric system, will be published in1994 or 1995. If adopted by the FHWA,this future AASHTO publication wouldconstitute the FHWA's policy on thegeometric design for federally-assistedconstruction projects.

The FHWA has also determined thatpublication of a notice of proposedrulemaking would be contrary to thepublic interest. As noted earlier, theFHWA has initiated a phased five yearplan to convert its activities andusiness operations to the metric system

of weights and measures as required bythe Metric Act. Section 3 of this Act seta deadline date of September 30, 1992,for each Federal government agency tobegin using the International System ofUnits (SI) in procurements, grants, andother business-related activities, exceptto the extent that such use is impracticalor would likely cause significantinefficiencies or loss of markets toUnited States firms. The FHWA's MetricConversion Policy, intended to meetthis requirement, was published in theFederal Register on June 11, 1992 (57FR 24843). The policy provides thatnewly authorized Federal LandsHighway and Federal-aid constructioncontracts must be in metric units onlyby September 30, 1996. Because of thelong lead times required for highwayconstruction projects, planning for 1996projects is already underway. To thisend, the States and other FHWApartners need to know now that themetric conversions used to formulatetheir plans will match the FHWA'sconversions.

Moreover, prior notice andopportunity for comment are notrequired under the Department ofTransportation's Regulatory Policies andProcedures because it is not anticipatedthat such action will result In thereceipt of useful information. TheFHWA has determined that theAASHTO interim metric values come asclose as possible to retaining the Englishmeasurements already adopted by theFHWA pursuant to notice and commentrulemaking, and express adoption ofthese metric values now providesnecessary certainty and continuity forStates and other FHWA partners,including highway constructioncontractors.

Nevertheless, public comment issolicited on this action. Commentsreceived will be carefully considered inevaluating whether any change to thisaction is needed.

Executive Order 12866 (RegulatoryPlanning and Review) and DOTRegulatory Policies and Procedures

The FHWA has determined that thisaction is not a "significant regulatory

Federal Register I Vol. 58, No. 236 I Friday, December 10, 1993 I Rules and Regulations 64897

action" within the meaning of ExecutiveOrder 12866 or "significant" within themeaning of Department ofTransportation Regulatory Policies andProcedures. As stated previously, theFHWA has determined that the interimmetric values selected by the AASHTOdocument are functionally equivalent toEnglish system measurementspreviously adopted by notice andcomment rulemaking. It is anticipated •that the economic impact of therulemaking will be minimal; therefore, afull regulatory evaluation is notrequired.


In compliance with the Regulatory -

Flexibility Act (Pub. L. 96-354, 5 U.S.C.601-612), the FHWA has evaluated theeffects of this rule on small entities.Based on the evaluation, the FHWAhereby certifies that this action will nothave a significant economic impact ona substantial number of small entities.As stated above, the FHWA made thisdetermination based on the fact that theinterim metric values selected arefunctionally equivalent to the Englishsystem values they replace.

Executive Order 12612 (FederalismAssessment)

This action has been analyzed inaccordance with the principles andcriteria contained in Executive Order12612, and it has been determined thatthis action does not have sufficientfederalism implications to warrant thepreparation of a federalism assessment.

Executive Order 12372(Intergovernmental Review)

Catalog of Federal DomesticAssistance Program Number 20.205,Highway Planning and Construction.The regulations implementing ExecutiveOrder 12372 regardingintergovernmental consultation onFederal programs and activities apply tothis program.


This action does not contain acollection of information requirementfor purposes of the PaperworkReduction Act of 1980, 44 U.S.C. 3501et seq.

National Environmental Policy Act

The agency has analyzed this actionfor the purpose of the NationalEnvironmental Policy Act of 1969 (42U.S.C. 4321 etseq.) and has determinedthat this action would not have anyeffect on the quality of the environment.

Regulation Identification NumberA regulation identification number

(RIN) is assigned to each regulatoryaction listed in the Unified Agenda ofFederal Regulations. The RegulatoryInformation Service Center publishesthe Unified Agenda in April andOctober of each year. The RIN numbercontained in the heading of thisdocument can be used to cross referencethis action with the Unified Agenda.

List of Subjects in 23 CFR Part 625Design standards, Grant programs-

transportation, Highways and roads,Incorporation by reference, Reportingand recordkeeping requirements.

In consideration of the foregoing, theFHWA amends chapter I of title 23,Code of Federal Regulations, part 625 asset forth below.

Issued on: November 22, 1993.Rodney E. Slater,Federal Highway Administrator.

The FHWA amends 23 CFR part 625as follows:

PART 625-DESIGN STANDARDS FORHIGHWAYS


Authority: 23 U.S.C. 109, 315, and 402; 49CFR 1.48(b).

§6254 [Amended]2. In § 625.4, paragraph (a) is

amended by redesignating paragraphs(a)(3) through (a)(11) as paragraphs(a)(4) through (a)(12), respectively, andby adding a new paragraph (a)(3) to readas follows:

§ 625.4 Standards, policies, and standardspecifications.

(a) * *(3) Interim Selected Metric Values for

Geometric Design, AASHTO, 1993. 131

[FR Doc. 93-29261 Filed 12-9-93; 8:45 am]BILUING CODE 410-2-P

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part I(TO 8499]RIN 1545-AG63

Differential Earnings Rate andRecomputed Differential Earnlngs Rateof a Mutual Ufe Insurance Company

AGENCY: Internal Revenue Service (IRS),Treasury.

ACTION: Final regulations.

SUMMARY: This document contains finalregulations relating to the differentialearnings rate and the recomputeddifferential earnings rate, which areused in determining the deduction forpolicyholder dividends of a mutual lifeinsurance company. The finalregulations provide that these ratescannot be negative. The applicable lawwas enacted as part of the Tax ReformAct of 1984. The final regulationsprovide guidance -to mutual lifeinsurance companies.DATES: These regulations are effectiveon December 10, 1993.

For dates of applicability, see § 1.809-9(c) of these regulations.FOR FURTHER INFORMATION CONTACT:Katherine Ann Hossofsky, (202) 622-3477 (not a toll-free number).


BackgroundThis document contains amendments

to the Income Tax Regulations (26 CFRpart 1) to provide guidance relating tothe differential earnings rate and therecomputed differential earnings rateunder section 809 of the InternalRevenue Code (Code). The finalregulations reflect the addition ofsection 809 to the Code by section211(a) of the Tax Reform Act of 1984(Pub. L. 98-369, 98 Stat. 733).

Proposed regulations under section809 (FI-159-84) were published in theFederal Register on August 19, 1992 (57FR 37495). Written comments werereceived from the public, and a publichearing was held on December 7, 199g.

After consideration of all of thecomments, the regulations proposed byFI-159-84 are adopted withoutsubstantive change by this Treasurydecision.

Statutory Formula for ReducingPolicyholder Dividends

Section 809(a) of the Code providesthat, in the case of any mutual lifeinsurance company, the amount of thededuction allowable under section 808for policyholder dividends is reduced(but not below zero) by the differentialearnings amount. The differentialearnings amount is the portion ofpolicyholder dividends deemed to be adistribution of a mutual company'sprofits to policyholders in their capacityas owners of the company. See H.R.Rep. No. 432 (Part 2), 98th Cong., 2dSess., 1422 (1984). In effect, otherwisedeductible policyholder dividendsequal in amount to the differentialearnings amount are not deductible.Any excess of the differential earnings



amount over the policyholder dividendsdeduction allowable under section 808is taken into account as an adjustmentto reserves under subsections (a) and (b)of section 807.

A mutual life insurance company'sdifferential earnings amount for anytaxable year is an amount equal to theproduct of the company's average equitybase for the year multiplied by thedifferential earnings rate for the year.

The differential earnings rate is theexcess of: (a) The imputed earnings ratefor the taxable year over (b) the averagemutual earnings rate for the secondcalendar year preceding the calendaryear in which the taxable year begins.The imputed earnings rate for anytaxable year is an amount which bearsthe same ratio to 16.5 percent as thecurrent stock earnings rate for thetaxable year bears to the base periodstock earnings rate.

To correct for the difference betweenthe average mutual earnings rate for thecalendar year in which the taxable yearbegins and the average mutual earningsrate for the second preceding calendaryear, section 809(f) provides amechanism under which the differentialearnings amount for the taxable year isrecomputed in the following taxableyear. This amount is known as therecomputed differential earningsamount. The recomputed differentialearnings amount for any taxable year iscalculated in the same manner as thedifferential earnings amount for thetaxable year, except that the averagemutual earnings rate for the calendaryear in which the taxable year begins issubstituted for the average mutualearnings rate for the second calendaryear preceding the calendar year inwhich the taxable year begins. Therevised rate is known as the recomputeddifferential earnings rate. If therecomputed differential earningsamount for any taxable year exceeds thedifferential earnings amount for thetaxable year, the excess is included inlife insurance gross income for thesucceeding taxable year. Conversely, ifthe differential earnings amount exceedsthe recomputed differential earningsamount, the excess is allowed as a lifeinsurance deduction for the succeedingtaxable year.

Explanation of ProvisionThe IRS publishes both the tentative

and final differential earnings rate andrecomputed differential earnings rate.These rates are used by mutual lifeinsurance companies in calculatingtheir federal income tax liability.Announcement 88-47, 1988-12 I.R.B.56, stated that the tentative recomputeddifferential earnings rate for 1986 was

-1.700. However, both the differentialearnings rate and the recomputeddifferential earnings rate are determinedbased on "the excess of" the imputedearnings rate over the average mutualearnings rate. Whenever the averagemutual earnings rate is Kreater than theimputed earnings rate, there is no"excess of" the imputed rate over theaverage mutual earnings rate. Byreferring to the excess of the imputedearnings rate over the average mutualearnings rate, the statutory formula doesnot permit the differential earnings rateto be negative. Accordingly, the InternalRevenue Service subsequently issuedNotice 88-106, 1988-2 C.B. 444, whichstated that regulations under section 809would provide that the differentialearnings rate may not be a negative rate.See also Rev. Rul. 88-80, 1988-2 C.B.129; Rev. Rul. 89-106, 1989-2 C.B. 108;Rev. Rul. 91-52, 1991-2 C.B. 331; andRev. Rul. 92-78, 1992-2 C.B. 143.

Congress added section 809 to limitthe deductibility of dividends paid bymutual life insurance companies to theirpolicyholders in recognition of the factthat these dividends are, to some extent,distributions of the companies' earningsto the policyholders as owners. Section809(a) states that the deduction allowedunder section 808 "shall be reduced(but not below zero) by the differentialearnings amount." The use of the termreduce reflects Congress's intention thatthe purpose of section 809 is to limit anotherwise deductible amount, not tocreate a new deduction. A negativedifferential earnings rate or a negativerecomputed differential earnings ratewould allow mutual life insurancecompanies to deduct an amount inexcess of dividends paid topolicyholders. This would be contraryto the intent of section 809.

The proposed regulations providedthat neither the differential earnings rate.under section 809(c) nor therecomputed differential earnings ratethat is used in computing therecomputed differential earningsamount under section 809(f)(3) may beless than zero.

Two comments were receivedconcerning the proposed regulations.

The first commentator states that theadoption of the proposed regulations infinal form is necessary to preserve theintegrity of section 809. The commentcontends that section 809 is simply themechanism to determine the amount ofthe reduction to a mutual life insurancecompany's policyholder dividenddeductions to reflect distributions topolicyholders in their role as owners ofthe company. The differential earningsrate is based on Congress' belief that"the average pre-tax return on equity of

mutual companies falls below that for acomparable group of stock companies"and that "this difference is attributableto distribution by mutual companies ofearnings to their owners." See H.R. Rep.432 (Part 2), 98th Cong.. 2nd Sess. 1422(1984). Thus, the commentatorconcludes that the only difference instock and mutual earnings rates thatCongress intended to utilize is thepositive difference by which the stockcompanies' (or imputed) earnings rateexceeds the mutual companies' earningsrate.

The first commentator further statesthat section 809(f)(2) does not supportrecognition of a negative recomputeddifferential earnings rate to permit adeduction for policyholder dividends inexcess of the dividends actually paid oraccrued during the taxable year towhich the recomputed rate relates.Rather, the deduction provided bysection 809(f)(2) merely compensatesthe taxpayer for what more current dataindicate to have been an excessivedisallowance in an earlier year.

Finally, the first commentator statesthat section 809 should not beinterpreted merely to limit over anextended period of time mutual lifeinsurance companies' deductions forpolicyholder dividends. The commentpoints out that sections 808(c) and 809expressly require computation of adeduction limit separately for eachtaxable year.

The second commentator states thatthere is no need for any regulations tobe issued regarding negative differentialearnings rates and that the proposedregulations represent an erroneousinterpretation of section 809.Specifically, the comment points outthat the Internal Revenue Service onfive occasions has expressed its viewthat neither the differential rate nor therecomputed differential earnings ratemay be negative. See Notice 88-106,Rev. Rul. 88-80, Rev. Rul. 89-106, Rev.Rul. 91-52, Rev. Rul. 92-78. In addition,the comment contends that adoption ofthe proposed regulations would resultin inappropriate and excessive taxationof mutual life insurance companies.

In American Mutual Life InsuranceCompany v. United States, Civil No. 4-92-70347 (S.D. Iowa, November 2,1993), the court held that the taxpayercould deduct an amount equal to theexcess of the differential earningsamount for the 1986 taxable year overthe negative recomputed differentialearnings amount for 1986. In itsopinion, the court stated that the partiesagreed that the statutory formulaproduced a 1986 recomputeddifferential earnings rate of - 1.695. Thecourt also noted that in its briefs in the

Federal Register / Vol. 58, No. 236 /, Friday, December 10, 1993 / Rules and Regulations 64899

case, and at oral argument, thegovernment had conceded that thestatutory formula produced a negative1986 recomputed differential earningsrate. Thus, the issue of whether thestatutory formula can produce anegative rate was not before the court.

The final regulations clarify that thestatute provides that the differentialearnings rate and the recomputeddifferential earnings rate cannot benegative.

Effective Date

Notice 88-106 set forth guidance thatwould be contained in forthcomingregulations. The notice stated thatregulations would be issued that wouldprovide that neither the differentialearnings rate nor the recomputeddifferential earnings rate may benegative. Rev. Rul. 88-80 stated that thefinal recomputed differential earningsrate for 1986 was zero even though thecalculated rate was negative, andindicated that when the regulationswere issued they may be effective priorto the date of Issuance. As the finalregulations involve the application ofthe guidance provided in Rev. Rul. 88-80, concerning the 1987 taxable year,the final regulations provide an effectivedate of taxable years beginning afterDecember 31, 1986.

Special Analyses

It has been determined that thisTreasury decision is not a significantregulatory action as defined inExecutive Order 12866. It has also beendetermined that section 553(b) of theAdministrative Procedure Act (5 U.S.C.chapter 5) and the Regulatory FlexibilityAct (5 U.S.C. chapter 6) do not apply tothese regulations, and, therefore, aRegulatory Flexibility Analysis is notrequired. Pursuant to section 78050 ofthe Internal Revenue Code, the notice ofproposed rulemaking for theseregulations was submitted to the ChiefCounsel for Advocacy of the SmallBusiness Administration for commenton their impact on small business.

Drafting Information

The principal author of these finalregulations Is Katherine Ann Hossofskyof the Office of the Assistant ChiefCounsel (Financial Institutions andProducts). However, other personnelfrom the IRS and Treasury Departmentparticipated in their development.


Income taxes, Reporting andrecordkeeping requirements.

Adoption of Amendments to theRegulations

Accordingly, 26 CFR part 1 isamended as follows:

PART 1-INCOME TAXES

Paragraph 1. The authority citationfor part I continues to read in part asfollows:

Authority: 26 U.S.C. 7805 *

Par. 2. Section 1.809-9 is added toread as follows:

S1.809- Computation of the differentialeanings rate and the recomputeddifferental earnings rate.

(a) In general. Neither the differentialearnings rate under section 809(c) northe recomputed differential earningsrate that is used in computing therecomputed differential earningsamount under section 809(f)(3) may beless than zero.

(b) Definitions-(1) Recomputeddifferential earnings amount. Therecomputed differential earningsamount, with respect to any taxableyear, Is the amount equal to the productof-

(i) The life insurance company'saverage equity base for the taxable year;multiplied by

(ii) The recomputed differentialearnings rate for that taxable year.

(2) Recomputed differential earningsrate. The recomputed differentialearnings rate for any taxable year equalsthe excess of-

(i) The imputed earnings rate for thetaxable year; over

(ii) The average mutual earning ratefor the calendar year in which thetaxable year begins.

(c) Effective date. The regulations areeffective for all taxable years beginningafter December 31, 1986.Michael P. Dolan,Acting Commissioner of Internal Revenue.

Approved: November 8, 1993.Leslie Samuels,Assistant Secretary of the Tmasuzy.[FR Doc. 93-30279 Filed 12-7-93; 4:03 pm]BILUING CODE 4630-1-3-

DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Parts 207, 208, 210, 216, 218,219, 220, 228, 229, and 243RIN 1010-AS89

Administrative Amendments ofRegulations Governing Royalty OilSurety Requirement, InformationCollection Requirements, andAddresses

AGENCY: Minerals Management Service,-Interior.ACTION: Final rule.

SUMMARY: The Minerals ManagementService (MMS) is making administrativeamendments to its Royalty ManagementProgram (RMP) regulations governing:

Royalty oil surety requirement;Information collection

requirements; and* References to addresses for mailing

or delivering requests. forms, and/orpayments to MMS.

These amendments will clarify andimprove the accuracy of MMS'regulations.EFFECTIVE DATE: December 10, 1993.FOR FURTHER INFORMATION CONTACT.David S. Guzy, Chief, Rules andProcedures Staff, Minerals ManagementService, Royalty Management Program,Mail Stop 3901, P.O. Box 25165,Denver, Colorado 80225-0165,telephone (303) 231-3432.SUPPLEMENTARY INFORMATION: Theprincipal author of this final rulemakingis Marvin D. Shaver of the Rules andProcedures Staff, MMS. RMP.

I. Amendment of Royalty Oil SuretyRequirement

The MMS is making amendments toits regulations at 30 CFR Part 208 "Saleof Federal Royalty Oil" to establish awider range of surety instruments thatwill be accepted by MMS from eligiblepurchasers of Federal royalty oil.Paragraph S 208.11(d) requires thatsureties be either surety bonds orirrevocable letters of credit fromfinancial institutions acceptable toMMS. Under the amended rule, MMSwill accept "MMS-specified suretyinstruments," which include:

" An MMS-specified bond," An MMS-specified irrevocable

letter of credit, or* A financial institution book-entry

certificate of deposit.The amendments to part 208 provide

requirements with respect to the MMS-specified surety instruments. Theamendments also replace the word"surety" from where it appears

G4900 Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations

§§ 208.7(h), 208.11, 208.12 (c) and (d),and 208.13(b) with the words "suretyinstrument" to provide consistency withthe term used in other MMS regulations.

The amendments are consistent withMMS' acceptance under 30 CFR part243 of a wider range of suretyinstruments to secure unpaid amountsowed the Government pendingadministrative appeals of decisions ororders issued by MMS. The MMS-specified surety instruments for appealpurposes were codified in 30 CFR243.2(b) by a Notice of FinalRulemaking published in the FederalRegister on September 30, 1992 (57 FR44991). The title of that Notice was"Revision of Regulation GoverningSuspension of Decisions and OrdersPending Appeal."

The MMS is also amending §§ 208.3,208.12, 208.13, 210.10, and 243.4 toremove references to Form MMS-4071"Semiannual Report of Royalty-In-KindOil Entitlements" because theinformation provided on that report isnow obtained by MMS from a differentsource. Section 208.2 is amended tochange a cross-reference to anotherregulation.

II. Amendment of InformationCollection Requirements

This rulemaking amends MMSregulations at 30 CFR parts 210 and 216governing information collectionrequirements:

* To revise the estimated time tocomplete seven existing reporting forms;

* To correct the title of one existingreporting form;

* To remove references to fourexisting reporting forms that are nolonger required; and

* To add one new reporting form.These amendments are discussed

below.(a) Revise estimated time to complete

reporting forms.The MMS published a Notice of Final

Rulemaking in the Federal Register onSeptember 14, 1992 (57 FR 41862),which codified statements on estimatedpublic reporting burden for thecollection of information. Thosestatements included estimates of thetime that it would take payors oroperators on Federal or Indian leases toprepare and complete required reportingforms. As a result of more recentstudies, MMS determined that theestimated time to complete seven of theforms should be revised. This final ruleamends the estimated times codified at§ 210.10(c) to complete the seven forms,which are MMS-2014, MMS-3160,MMS-4054, MMS-4055, MMS-4058,MMS-4059, and MMS-4110.

(b) Correct title of reporting form.

On November 5, 1992, MMSpublished a Notice of Final Rulemakingin the Federal Register (57 FR 52719),which amended its regulations toremove references to Form MMS-4014.(Report of Sales and RoyaltyRemittance-Solid Minerals). Thisamendment resulted from MMS'revision of its Form MMS-2014 (Reportof Sales and Royalty Remittance-Oil andGas) to provide for the reporting of salesand royalty information on all types ofmineral leases including solid mineralleases. As stated in the Notice, therevised Form MMS-2014 was retitled"Report of Sales and RoyaltyRemittance." The reference to "Oil andGas" was removed from the title.

The November 5, 1992, Notice revisedthe title of the Form MMS-2014referenced in various sections of MMS'regulations. However, MMSinadvertently failed to correct the title ofForm MMS-2014 in the table containedin § 210.10 "Information collection" andto remove a reference to Form MMS-4014 in § 243.4(6) of its regulations.This rulemaking amends the table in§ 210.10 to reflect the new title of FormMMS-2014 and § 243.4(6) to remove areference to Form MMS-4014.

(c) Removal of four reporting forms.The MMS is amending §§ 210.10 (a)

and (c), and removing §§ 216.52, 216.57,and 216.61, to remove references to fourreporting forms for informationcollection that are no longer required forthe following reasons:

9 Forms "MMS-4052-WellInformation Form" and "MMS-4061-API Well Number Change Report"because well reference data is nowsubmitted to MMS on magnetic tape.

9 Form "MMS-4057-FractionationPlant Operations Report" and "MMS-4071-Semiannual Report of Royalty-InKind Oil Entitlements" because theinformation provided on these reports isnow obtained by MMS from differentsources.

(d) Addition of one reporting form.The MMS is also amending§ 210.10

to add a new reporting form forinformation collection. This form, titled"Stripper Royalty Rate ReductionNotification" (Form MMS-4377), mustbe submitted by operators of stripper oilproperties who have been granted areduced royalty rate by the Bureau ofLand Management under 43 CFR3103.4-1 for each 12-month qualifyingperiod. This form has been approved bythe Office of Management and Budgetand assigned Clearance Number 1010-0090.

III. Amendment of MMS AddressesThe September 14, 1992, rulemaking

referenced in paragraph (a) above (57 FR

41862) also included amendments toreferences in MMS' regulations foraddresses to be used for mailing ordelivering requests, forms, and/orpayments to MMS. Subsequent to theSeptember Notice, MMS reorganized.This rulemaking removes references toMMS organizations and Mail Stops thatno longer exist under the neworganizational structure. The addresseschanged by this rule amendment arecontained in §§ 207.1, 210.10, 210.53,210.204, 210.355, 216.15, 216.16,216.40, 216.50, 218.51, 219.102,220.003, 228.10, and 229.123.

Procedural Matters

Administrative Procedure ActThe changes included in this

rulemaking are administrative only andare not substantive changes.Accordingly, pursuant to 5 U.S.C.553(b), it has been determined that it isunnecessary to issue proposedregulations before the issuance of thisfinal rule. For the same reason, it hasbeen determined that in accordancewith 5 U.S.C. 553(d), there is good causeto make this regulation effective uponpublication in the Federal Register.

Executive Order 12866This document has been reviewed

under Executive Order 12866.The Regulatory Flexibility Act

Because the changes areadministrative only With no additionalrequirements or burden placed on smallbusiness entities, the Department of theInterior (Department) has determinedthat this rule will not have a significanteconomic effect on a substantial numberof small entities under the RegulatoryFlexibility Act (5 U.S.C. 601 et seq.).

Executive Order 12778The Department has certified to the

Office of Management and Budget thatthese final regulations meet theapplicable standards provided insections 2(a) and 2(b)(2) of E.O. 12778.Paperwork Reduction Act of 1980

The information collectionrequirements contained in this rule havebeen approved by the Office ofManagement and Budget under 44U.S.C. 3501 et seq. and assignedClearance Numbers 1010-0022, 0033,.0040, 0042, 0061, 0063, 0064, 0074,.0075, 0076, 0087, 0088, and 0090.National Environmental Policy Act of1969

It is hereby determined that thisrulemaking does not constitute a majorFederal action significantly affecting thequality of.the human environment and


a detailed statement pursuant toparagraph (2)(C) of section 102 of theNational Environmental Policy Act of1969 (42 U.S.C. 4332(2)(C)) is notrequired.

List of Subjects

30 CFR Parts 207 and 210Coal, Continental shelf, Geothermal

energy, Government contracts, Indianlands, Mineral royalties, Natural gas,Petroleum, Public lands-mineralresources, Reporting and recordkeepingrequirements.

30 CFR Part 208

Continental shelf, Governmentcontracts, Mineral royalties, Petroleum,Public lands-mineral resources,Reporting and recordkeepingrequirements, Small businesses, Suretybonds.

30 CFR Parts 216, 228 and 229

Coal, Continental shelf, Geothermalenergy, Government contracts, Indianlands, Mineral royalties, Natural gas,Penalties, Petroleum, Public lands-mineral resources, Reporting andrecordkeeping requirements.

30 CFR Part 218

Coal, Continental shelf, Electronicfunds transfers, Geothermal energy,Government contracts, Indian lands,Mineral royalties, Natural gas, Penalties,Petroleum, Public lands-mineralresources, Reporting and recordingrequirements.

30 CFR Part 219Coal, Continental shelf, Electronic

funds transfers, Geothermal energy,Government contracts, Indian lands,Mineral royalties, Natural gas,Petroleum, Public lands-mineralresources, Reporting and recordingrequirements.

30 CFR Part 220

Coal, Continental shelf, Geothermalenergy, Government contracts, Mineralroyalties, Natural gas, Petroleum, Publiclands-mineral resources, Reporting andrecording requirements.

30 CFR Part 243

Coal, Continental shelf, Geothermalenergy, Government contracts, Indianlands, Mineral royalties, Natural gas,Petroleum, Public lands-mineralresources.

Dated: October 27, 1993.Bob Armstrong,Assistant Secretaty-Loand and MineralsManagement.

For the reasons set out in thepreamble, 30 CFR parts 207, 208, 210,

216, 218, 219, 220, 228, 229, and 243 areamended as follows:

PART 207-SALES AGREEMENTS ORCONTRACTS GOVERNING THEDISPOSAL OF LEASE PRODUCTS

1. The authority citation for part 207is revised to read as follows:

Authority: 5 U.S.C. 301 et seq.; 25 U.S.C.396 et seq.; 25 U.S.C. 396a et seq.; 25 U.S.C.2101 et seq.; 30 U.S.C. 181 et seq.; 30 U.S.C.'351 et seq.; 30 U.S.C. 1001 et seq.; 30 U.S.C.1701 et seq.; 31 U.S.C. 3716 et seq.; 31 U.S.C.9701:43 U.S.C. 1301 etseq.; 43 U.S.C. 1331et seq.; and 43 U.S.C. 1801 et seq.

§ 207.1 [Amended]2. Section 207.1 "Required

recordkeeping" is amended by removingthe Mail Stop (MS) "MS 2300" fromwhere it appears in the address inparagraph (b).

PART 208-SALE OF FEDERALROYALTY OIL


Authority: 5 U.S.C. 301 et seq.; 30 U.S.C.181 et seq.; 30 U.S.C, 351 et seq.; 30 U.S.C.1701 etseq.; 31 U.S.C. 9701; 43 U.S.C. 1301et seq.; 43 U.S.C. 1331 et seq. and 43 U.S.C.1801 et seq.

2. Section 208.2 "Definitions" is amendedby removing the reference to "13 CFR 121.3-9(a)(1)" in paragraph (2) of the definition of"Eligible refiner" and adding "13 CFR part121" in its place.

3. Section 208.3 "InformationCollection" is revised to read as follows:

§208.3 Information collection.The information collection

requirements contained in this part havebeen approved by OMB under 44 U.S.C.3501 et seq. The form, filing date, andapproved OMB clearance number areidentified in 30 CFR 210.10.

4. Paragraph (a) of § 208.6 is revisedto read as follows:

§ 208.6 General application procedures. -(a) To apply for the purchase of

royalty oil, an applicant must file aForm MMS-4070 with MMS inaccordance with instructions providedin the "Notice of Availability of RoyaltyOil" and in accordance with anyinstructions issued by MMS forcompletion of Form MMS-4070. Theapplicant will be required to submit aletter of intent from a qualified financialinstitution stating that it would begranted surety coverage for the royaltyoil for which it is applying, or othersuch proof of surety coverage, asdeemed acceptable by MMS. The letterof intent must be submitted with acompleted Form MMS-4070.

5. Paragraph (h) of § 208.7"Determination of eligibility" isamended to add the word "instrument"after the word "surety" in the lastsentence.


§208.11 Surety requirements.(a) The eligible purchaser, prior to

execution of the contract, shall furnishan "MMS-specified surety instrument,"in an amount equal to the estimatedvalue of royalty oil that could be takenby the purchaser in a 99-day period,plus related administrative charges. TheMMS may require the purchaser toincrease the amount of the suretyinstrument when necessary to protectthe Government's interest or may allowthe purchaser to decrease the amount ofthe surety instrument where necessaryto further the purposes of the Royalty-in-Kind Program.

(b) If a letter of credit is furnished asthe surety instrument, it must beeffective for a 9-month period beginningthe first day the royalty oil contract iseffective, with a clause providing forautomatic renewal monthly for a new 9-month period. The purchaser or itssurety company may elect not to renewthe letter of credit at any monthlyanniversary date, but must notify MMSof its intent not to renew at least 30 daysprior to the anniversary date. The MMSmay grant the purchaser 45 days toobtain a new surety instrument. If noreplacement surety instrument isprovided, MMS will terminate thecontract effective at least 6 months priorto the expiration date of the letter ofcredit. Notwithstanding the aboveprovisions, the letter of credit also maycontain a clause providing for automatictermination 6 months after the royaltyoil contract terminates. If a certificate ofdeposit is furnished as the suretyinstrument, it must be effective for thelife of the contract plus 6 months afterthe royalty oil contract terminates.

(c) For the purposes of this section, an"MMS-specified surety instrument"means either: an MMS-specified suretybond, an MMS-specified irrevocableletter of credit, or a financial institutionbook-entry certificate of deposit.

(d) The "MMS-specified suretyinstrument" shall be in a form specifiedby MMS instructions or approved byMMS. A bond must be issued by aqualified surety company that has beenapproved by the Department of theTreasury. An irrevocable letter of creditor a certificate of deposit must be froma financial institution acceptable toMMS. The MMS will use a bank ratingservice to determine whether a financialinstitution has an acceptable rating to


provide a surety instrument deemedadequate to indemnify the Governmentfrom loss or damage.

(e) All surety instruments must be ina form acceptable to MMS and mustinclude such other specificrequirements as MMS may requireadequately to protect the Government'sinterests.

7. Paragraph (a) of § 208.12 isamended by removing the reference to"§ 208.13(b)" in the last sentence andadding "208.13" in its place.

8. Paragraphs (c) and (d) of § 208.12are revised to read as follows:

§208.12 Payment of requirements.* * *r *t i

(c) If payment for royalty oil is notreceived by the due date specified in thecontract, a notice of nonreceipt will besent to the purchaser by certified mail.If payment is not received by MMSwithin 15 days from the date of suchnotice, MMS may cancel the contractand collect under the MMS-specifiedsurety instrument. See § 208.11.

(d) If the purchaser disagrees with theamount of payment due, it must pay theamount due as computed by MMS,unless the purchaser appeals theamount and posts an MMS-specifiedsurety instrument pursuant to theprovisions of 30 CFR part 243. TheMvS may, at its discretion, waive theappeal surety requirements if itdetermines that the contract suretyinstrument is sufficient protection for anamount under appeal.


§208.13 Reporting requirements.If MMS underbills a purchaser under

a royalty oil contract because of apayor's underreporting or failure toreport on Form MMS-2014 pursuant to30 CFR 210.52, the payor will be liablefor payment of such underbilledamounts plus interest if they areunrecoverable from the purchaser or thesurety instrument related to thecontract.

PART 210-FORMS AND REPORTS


Authority: 5 U.S.C. 301 et seq.; 25 U.S.C.396 et seq.; 25 U.S.C. 396a et seq.; 25 U.S.C.2101 et seq.; 30 U.S.C. 181 et seq.; 30 U.S.C.351 et seq.; 30 U.S.C. 1001 et seq.; 30 U.S.C.1701 et seq.; 31 U.S.C. 3716 et seq.; 31 U.S.C.9701; 43 U.S.C. 1301 etseq.;43 U.S.C. 1331et seq.; and 43 U.S.C. 1801 et seq.

§§210.10, 210.53, 210.204, and 210.355[Amended]

2. In the list below, for each sectionand paragraph indicated in the left

column, remove the words and/or MailStop (MS) indicated in the right columnfrom wherever they appear in thatsection and paragraph.

Section Remove words/MS

210.10(b)(3) .. "Production Accounting Divi-sion,"

210.10(b)(4) "Royalty Valuation andStandards Division,"

210.10(b)(4) "MS 3500,"210.10(b)(5) "Royalty Compliance Divi-.

sion,"210.10(b)(5) "MS 3600,"210.10(b)(6) "Revenue and Document

Processing,"210.10(d) ....... "MS 2300,"210.53(a) ....... "Fiscal Accounting Division,"210.53(a) ....... "MS 3200,"210.53(a) ....... "Production Accounting Divi-

sion,"210.53(b) ....... "Lessee Contact Branch with

respect to royalty reporting,or the MMS Reporter Con-tract Branch with respectto production reporting,"

210.204(a) ..... "Fiscal Accounting Division,"210.204(a) -.. "MS 3200,"210.204(a) ..... "Production Accounting Divi-

sion,"210.204(b) ..... "Lessee Contact Branch with

respect to royalty reporting,or the MMS Reporter Con-tact Branch with respect toproduction reporting,"

210.355(a) ..... "Fiscal Accounting Division,"210.355(b) ..... "Lessee Contact Branch."

3. In the list below, for each paragraphof § 210.10 "Information collection"indicated in the left column, remove thetime in minutes or hours indicated inthe middle column from wherever itappears in that paragraph, and add thetime in minutes or hours indicated inthe right column.

§210.10 Remove Add

(c)(1) .............. 9 minutes ... 7 minutes.(c)(2) .............. 3G minutes . 15 minutes.(c)(8) .............. 1 hour ......... 30 minutes.(c)(9) .............. 30 minutes . 15 minutes.(c)(12) ............ 1 hour ......... 15 minutes.(c)(1 3) ............ 11/2 hours ... 1.25 hours.(c)(19) ............ 1 hour ......... 2 hours.(c)(19) ............ 3 hours ....... 5 hours.

4. Section 210.10 is amended byrevising the title of Form MMS-2014contained in the table in paragraph (a).Remove the title "MMS-2014--Reportof Sales and Royalty Remittance-Oiland Gas" at the beginning of the tableand replace with the title "MMS-2014-Report of Sales and RoyaltyRemittance."

5. The table in paragraph (a) of§ 210.10 is amended by removing allreferences to form numbers MMS-4052,MMS-4057, MMS-4061, and MMS-4071 from where they appear in the

table and add a new form number,name, filing date and OMB number innumerical sequence at the end of thetable to read as follows:

§210.10 Information collection.(a) * * *

Form No., name and filing date OMB No.

MMS-4377-Stripper RoyaltyRate Reduction Notification-Due for each 12-month quali-fying period that a reducedroyalty rate is granted by theBureau of Land Management 1010-0090

6. Paragraph (b)(1) of § 210.10 isrevised to read as follows:

§210.10 Information collection.(a) * * *(b)(1) Requests for Forms MMS-2014

or MMS-4070 should be addressed tothe Minerals Management Service,Royalty Management Program, P.O. Box5760, Denver, Colorado 80217-5760.The completed Form MMS-2014 shouldbe mailed to the Minerals ManagementService, Royalty Management Program,P.O. Box 5810, Denver, Colorado 80217-5810. The address to which a completedForm MMS-4070 should be mailed willbe identified in a Federal RegisterNotice of Availability of Royalty Oil.(See 30 CFR 208.5.)* * * * *

7. Section 210.10 is amended byremoving paragraphs (c)(6), (c)(11),(c)(15), and (c)(17) and redesignatingparagraphs (c)(7) through (10) asparagraphs (c)(6) through (9)redesignating paragraphs (c)(12) through(14) as (c)(10) through (12),redesignating paragraph (c)(16) as(c)(13), and redesignating paragraphs(c)(18) through (23) as (c)(14) through(19) respectively. Also, a new paragraph,(c)(20) is added to read as follows:

§ 210.10 Information collection.• * ,* *r *

(c)(20) MMS-4377-This form mustbe submitted by operators of stripper oilproperties to notify MMS of reducedroyalty rates granted by the Bureau ofLand Management under 43 CFR3103.4-1 for each 12-month qualifyingperiod. Reporting burden is estimated torequire an average of 30 minutes perform to supply the operator name, leaseand agreement numbers, calculated andcurrent royalty rate, and the periodcovered. Comments submitted relativeto this information collection shouldreference Paperwork Reduction Project1010-0090.* * *t * *


PART 216-PRODUCTIONACCOUNTING


Authority: 5 U.S.C. 301 et seq.; 25 U.S.C.396 et seq., 25 U.S.C. 396a et seq.: 25 U.S.C.2101 et seq.: 30 U.S.C. 181 et seq.; 30 U.S.C351 et seq.; 30 U.S.C. 1001 et seq.; 30 U.S.C.1701 et seq.; 31 U.S.C. 3716 et seq.; 31 U.S.C.9701; 43 U.S.C. 1301 etseq.; 43 U.S.C. 1331et seq.; and 43 U.S.C. 1801 et seq.

§ 216.15, 216.16, 216.40, 216.50, 216.52,216.53, 216.54, 216.55, 216.56, 216.57,216.58, and 216.61 [Amended]

2. In the list below, for each sectionand paragraph indicated in the leftcolumn, remove the words indicated inthe right column from wherever theyappear in that section and paragraph:

Section Remove words

216.15(a) .. "Production Accounting Divi-sion,"

216.15(b) .. "Reporter Contact Branch."216.16(a).. "Production Accounting Divi-

sion,"216.16(b) .. "Room A-212, Revenue and

Document Processing."216.40(c) .. "Fractionation Plant Operations

Report (Form MMS-4057)."216.50(a) .. 'To the Chief, Production Ac-

counting Division, RoyaltyManagement Program,MMS."

3. Sections 216.52, 216.57, and216.61, under Subpart B--Oil and Gas,General, are removed, and §§ 216.53,216.54, 216.55, 216.56, and 216.58 areredesignated as §§ 216.52 through216.56, respectively.

4. A new § 216.57 is added underSubpart B-Oil and Gas, General, toread as follows:

§216.57 Stripper royalty rate reductionnotification.

In accordance with its regulations at43 CFR 3103.4-1, titled "Waiver,suspension, or reduction of rental,royalty, or minimum royalty," theBureau of Land Management (BLM) maygrant reduced royalty rates to operatorsof low producing oil leases to encouragecontinued production. Operators whohave been granted a reduced royaltyrate(s) by BLM must submit a StripperRoyalty Rate Reduction Notification(Form MMS-4377) to MMS for each 12-month qualifying period that a reducedroyalty rate(s) is granted.

5. Paragraphs (c)(1) and (c)(2) of§ 216.50 are amended to change thereference in those paragraphs from"§ 216.54" to "§ 216.53."

PART 218-COLLECTION OFROYALTIES, RENTALS, BONUSESAND OTHER MONIES DUE THEFEDERAL GOVERNMENT


Authority: 5 U.S.C. 301 et seq.; 25 U.S.C396 et seq.; 25 U.S.C. 396a et seq.; 25 U.S.C.2101 et seq.; 30 U.S.C. 181 et seq.; 30 U.S.C.351 et seq.; 30 U.S.C. 1001 et seq.; 30 U.S.C.1701 et seq.: 31 U.S.C. 3716; 31 U.S.C.3720A; 31 U.S.C. 9701; 43 U.S.C 1301 etseq.; 43 U.S.C 1331 et seq.; and 43 U.S.C.1801 et seq.

§218.51 [Amended]2. Section 218.51 "Method of

payment" is amended by removing thewords "Room A-212, Revenue andDocument Processing," from where theyappear in the address in paragraph(0(2).

PART 219-DISTRIBUTION ANDDISBURSEMENT OF ROYALTIES.RENTALS, AND BONUSES


Authority: Section 104, Pub. L. 97-451, 96Stat. 2451 (30 U.S.C. 1714).

§219.102 [Amended]2. Section 219.102 "Method of

payment" is amended by removing thewords "Fiscal Accounting Division,"and "MS 3200," from where they appearin that section.

PART 220-ACCOUNTINGPROCEDURES FOR DETERMININGNET PROFIT SHARE PAYMENT FOROUTER CONTINENTAL SHELF OILAND GAS LEASES


Authority: Sec. 205, Pub. L. 95-372, 92Stat 643 (43 U.S.C. 1337).

9220.003 [Amended]2. Section 220.003 "Information

collection" is amended by removing theMail Stop (MS) "MS 2300," from whereit appears in the address in paragraph(b).

PART 228-COOPERATIVEACTIVITIES WITH STATES ANDINDIAN TRIBES


Authority: Section 202, Pub. L. 97-451, 96Stat. 2457 (30 U.S.C. 1732).

§228.10 [Amended]2. Section 228.10 "Information

collection," is amended by removing theMail Stop (MS) "MS 2300," from where

it appears in the address in paragraph(b).

PART 229-DELEGATION TO STATES


Authority: Section 205, Pub. L 97-451, 96Stat. 2459 (30 U.S.C. 1735).

S 229.123 [Amended]

2. Section 229.123 "Standards foraudit activities" is amended byremoving the words "the RoyaltyCompliance Division (RCD) of the" fromthe second sentence of paragraph (b)(2).

3. Paragraphs (b)(2) and.(b)(3)(vii) of§ 229.123 are amended by removing theabbreviation "RCD" from where itappears in those paragraphs. Add theabbreviation "MMS" in place of theabbreviation "RCD" that was removed.

PART 243-APPEALS-ROYALTYMANAGEMENT PROGRAM


Authority: R.S. 463, 25 U.S.C. 2; R.S. 465,25 U.S.C. 9; sec. 32, 41 Stat. 450, 30 U.S.C.189: sec. 5. 44 Stat. 1058, 30 U.S.C. 285; sec.10, 61 Stat. 915, 20 U.S.C. 359; secs. 5, 6, 67Stat. 464,465, 43 U.S.C. 1334, 1335; sec. 24,84 Stat. 1573, 30 U.S.C. 1023, 30 U.S.C. 1701et seq.

§ 243.4 [Amended]

2. Paragraph (b)(2) of § 243.4, "Serviceof official correspondence," is removed,and paragraphs (b)(3) through (b)(9) areredesignated as new paragraphs (b)(2)through (b)(8), respectively.

3. In newly designated paragraph(b)(8) the reference to "paragraphs (b)(1)through (8)" is revised to read"paragraphs (b)(1) through (7)".

4. Newly designated paragraph (b)(5)is amended to read as follows:

§243.4 Serving of official correspondence.

(b)(5) The addressee of record forserving official correspondence relatingto reporting on the "Report of Sales andRoyalty Remittance" (Form MMS-2014)is the most recent position title,department name and address, orindividual name and address specified,in writing, by the payor. The payor isresponsible for notifying the RoyaltyManagement Program, in writing, of anyaddressee changes.

[FR Doc. 93-30109 Filed 12-9-93; 8:45 am)BILUNG COOE 4310-"R-#


DEPARTMENT OF THE TREASURY

Office of Foreign Assets Control

31 CFR Part 590

UNITA (Angola) Sanctions Regulations

AGENCY: Office of Foreign AssetsControl, Treasury.ACTION: Final rule.

SUMMARY: The Office of Foreign AssetsControl of the U.S. Treasury Departmentis issuing the UNITA (Angola) SanctionsRegulations to implement thePresident's declaration of a nationalemergency and imposition of sanctionsagainst the National Union for the TotalIndependence of Angola ("UNITA").EFFECTIVE DATE: December 10, 1993.FOR FURTHER INFORMATION CONTACT: JohnT. Roth, Chief of Policy Planning andProgram Management (tel: 202/622-2500), Steven I. Pinter, Chief ofLicensing (tel: 202/622-2480), orWilliam B. Hoffman, Chief Counsel,(tel.: 202/622-2410), Office of ForeignAssets Control, Department of theTreasury, Washington, DC 20220.


Electronic AvailabilityThis document is available as an

electronic file on The Federal BulletinBoard the day of publication in theFederal Register. By modem dial 202/512-1387 or call 202/512-1530 for disksor paper copies. This file is available inPostscript, WordPerfect 5.1 and ASCII.

Background

On September 26, 1993, the Presidentissued Executive Order 12865,declaring a national emergency withrespect to Angola, and invoking theauthority, inter alia, of the InternationalEmergency Economic Powers Act (50U.S.C. 1701 et seq.) and the UnitedNations Participation Act of 1945 (22U.S.C. 287c). Consistent with UnitedNations Security Council Resolution864, dated September 15, 1993, theorder prohibits the sale or supply byUnited States persons or from theUnited States, or using U.S. registeredvessels or aircraft, of arms and relatedmateriel of all types, including weaponsand ammunition, military vehicles,equipment and spare parts, andpetroleum and petroleum products tothe territory of Angola other thanthrough designated points of entry. Italso prohibits such sale or supply toUNITA. U.S. persons are prohibitedfrom activities which promote or arecalculated to promote such sales orsupplies, or from attempted violations,or from evasion or avoidance or

transactions that have the purpose ofevasion or avoidance, of the statedprohibitions. The order authorizes theSecretary of the Treasury, inconsultation with the Secretary of State,to take such actions, including thepromulgation of rules and regulations,as may be necessary to carry out thepurposes of the order.

In implementation of this order, theTreasury Department is issuing theUNITA (Angola) Sanctions Regulations(the "Regulations").

The Regulations prohibit the sale orsupply by United States persons or fromthe United States, or using U.S.registered vessels or aircraft, of armsand related materiel of all types,including weapons and ammunition,military vehicles, equipment and spareparts, and petroleum and petroleumproducts to UNITA or to the territory ofAngola other than through designatedpoints. U.S. persons are also prohibitedfrom activities which promote or arecalculated to promote such sales orsupplies to UNITA or Angola, or fromany transaction by any United Statesperson that evades or avoids, or has thepurpose of evading or avoiding, orattempts to violate, any of theprohibitions set forth in the executiveorder. Also prohibited are transactionsby U.S. persons, or involving the use ofU.S.-registered vessels or aircraft,relating to transportation to Angola orUNITA of goods the exportation ofwhich is prohibited.

Transactions otherwise prohibitedunder this part may be authorized by ageneral license contained in subpart Eor by a specific license issued pursuantto the procedures described in § 590.801of subpart H.

Since the Regulations involve aforeign affairs function, Executive Order12866 and the provisions of theAdministrative Procedure Act (5 U.S.C.553) requiring notice of proposedrulemaking, opportunity for publicparticipation, and delay in effectivedate, are inapplicable. Because nonotice of proposed rulemaking isrequired for this rule, the RegulatoryFlexibility Act (5 U.S.C. 601 et seq.)does not apply.

The Regulations are being issuedwithout prior notice and publicprocedure pursuant to theAdministrative Procedure Act. For thisreason, the collections of informationcontained in the Regulations are beingsubmitted to the Office of Managementand Budget ("OMB") under thePaperwork Reduction Act of 1980 (44U.S.C. 3501 et seq.). Commentsconcerning the collection of informationand the accuracy of estimated averageannual burden, and suggestions for

reducing this burden should be directedto OMB, Paperwork Reduction Project[1505.****], Washington, DC 20503,with copies to the Office of ForeignAssets Control, U.S. TreasuryDepartment, 1500 Pennsylvania Ave.,NW-Annex, Washington, DC 20220.Any such comments should besubmitted not later than February 8,1994. Notice of 0MB action on theserequests will be published in theFederal Register.

The collections of information in iheRegulations are contained in subpart F,and §§ 590.703 and 590.801. Thisinformation is required by the Office ofForeign Assets Control for licensing,compliance, civil penalty andenforcement purposes. This informationwill be used to determine the eligibilityof applicants for the benefits providedthrough specific licenses, to determinewhether persons subject to theRegulations are in compliance withapplicable requirements, and todetermine whether and to what extentcivil penalty or other enforcementaction is appropriate. The likelyrespondents and recordkeepers arebusiness organizations.

Estimated total annual reporting and/or recordkeeping burden: 100 hours.

The estimated annual burden perrespondent/recordkeeper varies from 30minutes to 2 hours, depending onindividual circumstances, with anestimated average of 1 hour.

Estimated number of respondentsand/or recordkeepers: 50.

Estimated annual frequency ofresponses: 1 - 3.


procedure, Angola, Exports, Foreigntrade, National Union for the TotalIndependence of Angola, Penalties,Reporting and recordkeepingrequirements, Shipping, UNITA,Vessels.

For the reasons set forth in thepreamble, 31 CFR part 590 is added toread as follows:

PART 590-UNITA (ANGOLA)SANCTIONS REGULATIONS

Subpart A-Relation of this Part to OtherLaws and RegulationsSec.590.101 Relation of this part to other laws

and regulations.Subpart B--Prohibitions590.201 Prohibited sale or supply of arms,

arms materiel, petroleum or petroleumproducts to UNITA or Angola.

590.202 Prohibited transportation-relatedtransactions involving Angola or UNITA.

590.203 Evasions; attempts.


Subpart C-General Definitions590.301 Effective date.590.302 License.590.303 General license.590.304 Specific license.590.305 Person.590.306 Entity.590.307 National Union for the Total

Independence of Angola, or UNITA.590.308 United States.590.309 United States person; U.S. person.590.310 UNSC Resolution 864.590.311 Petroleum and Petroleum Products590.312 Arms and Related Materiel

Subpart D--ntrpetations590.401 Reference to amended sections.590.402 Effect of amendment..590.403 Payments in connection with certain

authorized transactions.590.404 Transshipments through the United

States prohibited.590.405 Exports to third countries;

transshipments.590.406 Agency jurisdiction; licensing

requirements.590.407 Transactions incidental to a licensed

transaction.

Subpart E--Llcenses, Authorizations andStatements of Ucensing Policy590.501 Effect of license or authorization.590.502 Exclusion from licenses and

authorizations.

Subpart F-Reports590.601 Required records,590.602 Reports to be furnished on demand.

Subpart G--Penalties590.701 Penalties.590.702 Prepenalty notice.590.703 Presentation responding to

prepenalty notice.590.704 Penalty notice.590.705 Referral to United States Department

of justice.

Subpart H -Procedures590.801 Licensing.590.802 Decisions.590.803 Amendment, modification, or

revocation.590.804 Rulemaking ,590.805 Delegation by the Secretary of the

Treasury.590.806 Rules governing availability of

information.

Subpart 1-Paperwork Reduction Act590.901 IReserved].

Appendix A to part 590-r-Arms and RelatedMateriel.

Authority:. 50 U.S.C. 1701-1706; 50 U.S.C.1601-1651; 22 U.S.C. 287c; 3 U.S.C. 301; E.O.12865, 58 FR 51005 (September 29, 1993).

Subpart A-Relation of This Part toOther Laws and Regulations

§ 590.101 Relation of this part to otherlaws and regulations.

(a) This part is separate from, andindependent of, the other parts of thischapter. Differing foreign policy and

national security contexts may result indiffering interpretations of similarlanguage among the parts of thischapter. No license or authorizationcontained in or issued pursuant to thoseother parts authorizes any transactionprohibited by this part. No license orauthorization contained in or issuedpursuant to any other provision of lawor regulation authorizes any transactionprohibited by this part.

(b) No license or authorizationcontained in or issued pursuant to thispart relieves the Involved parties fromcomplying with any other applicablelaws or regulations.

Subpart B-Prohibitions

§ 590.201 Prohibited sale or supply ofarms, arms materiel, petroleum orpetroleum products to UNITA or Angola.

Except as otherwise authorizedpursuant to this part, the sale or supplyby United States persons or from theUnited States, or any activity by UnitedStates persons or in the United Stateswhich promotes or is calculated to"promote the sale or supply, of arms andrelated materiel of all types, includingweapons and ammunition, militaryvehicles and equipment and spare parts,and petroleum and petroleum products.are prohibited, regardless of origin, to:

(a) UNITA; or(b) the territory of Angola, other than

through points of entry designated bythe Secretary of the Treasury in thefollowing schedule:

(1) Airports:(i) Luanda(i) Katumbela. Benguela Province(2) Ports:(i) Luanda(ii) Lobito, Benguela Province(iii) Namibe, Namibe Province(3) Entry Points:(i) Malongo, Cabinda(ii) (Reserved].

§590.202 Prohibited transportation-relatedtransactions Involving Angola or UNITA.

Except as otherwise authorized, anytransaction by a U.S. person, orinvolving the use of U.S. registeredvessels or aircraft, relating totransportation to Angola or UNITA ofgoods the exportation of which isprohibited in § 590.201 is prohibited.

§590.203 Evasions; attempts.Any transaction for the purpose of, or

which has the effect of, evading oravoiding, or which facilitates theevasion or avoidance of, any of theprohibitions set forth in this subpart, ishereby prohibited. Any attempt toviolate the prohibitions set forth in thispart is hereby prohibited.

Subpart C-General Definitions

§590.301 Effective date.The term "effective date" refers to the

effective date of the applicableprohibitions and directives contained insubpart B as follows:

(a) With respect to §§ 590.201,590.202, and 590.203,4:35 p.m. EDT.September 26, 1993.

(b) [Reserved].

§ 590.302 Ucense.Except as otherwise specified, the

term "license" means any license orauthorization contained in or issuedpursuant to this part.

§ 590.303 General lIcense.The term "general license" means any

license or authorization the terms ofwhich are set forth in this subpart E.

§ 590.304 Specific license.The term "specific license" means

any license or authorization not set forthin subpart E but issued pursuant to thispart in response to an application.

§ 590.305 Person.The term "person" means an

individual or entity.

§ 590.306 Entity.The term "entity" includes a

corporation, partnership, association, orother organization.

§ 590.307 National Union for the TotalIndependence of Angola, or UNITA.

The term "National Union for theTotal Independence of Angola" or"UNITA" includes:

(a) Any entity, political subdivision,agency, or instrumentality of UNITA,including without limitation:

(1) the Uniao Nacional para aIndependencia Total do Angola(UNITA), known in English as the"National Union for the TotalIndependence of Angola;"

(2) the Forcas Armadas para aLiberacdo de Angola (FALA), known inEnglish as the "Armed Forces for theLiberation of Angola:" and

(3) the Free Angola InformationServices, Inc.

(b) Any person or entity substantiallyowned or controlled by the foregoing;

(c) Any person to the extent that suchperson is. or has been, or to the extentthat there is reasonable cause to believethat such person is. or has been, sincethe effective date. acting or purportingto act directly or indirectly on behalf ofany of the foregoing; and

(d) Any other person or entitydetermined by the Director of the Officeof Foreign Assets Control to be includedwithin this section.


§590.308 UnIted States.The term "United States" means the

United States, its territories andpossessions, and all areas under thejurisdiction or authority thereof.

§ 590.309 United States person; U.S.person.

The term "United States person" or"U.S. person" means any United Statescitizen; permanent resident alien;juridical person organized under thelaws of the United States or anyjurisdiction within the United States,including foreign branches; or anyperson in the United States, and vesselsand aircraft of U.S. registration.

§ 590.310 UNSC Resolution 864.The term "UNSC Resolution 864"

means United Nations Security CouncilResolution No. 864, adopted September15, 1993, prohibiting certaintransactions with respect to Angola.

§590.311 Petroleum and petroleumproducts.

The term "petroleum and petroleumproducts" means items listed in 15 CFRpart 777, supplements 2 and 3, of theExport Administration Regulations.

§590.312 Arms and related materiel.The term "arms and related materiel"

means items listed in appendix A to thispart, all items listed on the Commerce.Control List ending with the number"18", 15 CFR 799.1, supplement 1, andany item controlled under theInternational Traffic in ArmsRegulations, 22 CFR parts 120 through130.

Subpart D--Interpretatlons

§ 590.401 Reference to amended sections.Except as otherwise specified,

reference to any section of this part orto any regulation, ruling, order,instruction, direction, or license issuedpursuant to this part shall be deemed torefer to the same as currently amended.

§ 590.402 Effect of amendment.Any amendment, modification, or

revocation of any section of this part orof any order, regulation, ruling,instruction, or license issued by orunder the direction of the Director of theOffice of Foreign Assets Control shallnot, unless otherwise specificallyprovided, be deemed to affect any actdone or omitted from being done, or anycivil or criminal suit or proceedingcommenced or pending prior to suchamendment, modification, orrevocation. All penalties, forfeitures,and liabilities under any such order,regulation, ruling, instruction, or licenseshall continue and may be enforced as

if such amendment, modification, orrevocation had not been made.

§ 590.403 Payments In connection withcertain authorized transactions.

Except as otherwise specified,payments are authorized in connectionwith transactions authorized in orpursuant to subpart E.

§ 590.404 Transshipments through theUnited States prohibited.

The prohibitions in § 590.201 apply tothe importation into the United Statesfor transshipment or transit of goods,the sale or supply of which to Angolaor UNITA is prohibited by § 590.201.

§ 590.405 Exports to third countries;transshipments.

Exportation of arms and relatedmateriel of all types, including weaponsand ammunition, military vehicles andequipment and spare parts, andpetroleum and petroleum products fromthe United States to third countries isprohibited if the exporter knows, or hasreason to know, that the goods areintended for reexportation ortransshipment to Angola (except to apoint of entry designated by theSecretary in § 590.201) or to UNITA,including passage through, or storage in,intermediate destinations.

§ 590.406 Agency Jurisdiction; licensingrequirements.

(a) Nothing in this part shall beconstrued to supersede the requirementsestablished under the Arms ExportControl Act (22 U.S.C. 2751 et seq.) andthe Export Administration Act (50U.S.C. App. 2401 et seq.) to obtainlicenses for the exportation from theUnited States or from a third country ofany goods, data, or services subject tothe export jurisdiction of theDepartment of State or the Departmentof Commerce.

(b) Exports to Angola through pointsof entry designated by the Secretary inthe schedule in § 590.201 and notconsigned to or destined for UNITA donot require a license from the Office ofForeign Assets Control, but may requirelicensing by the Department of State orDepartment of Commerce in accordancewith the requirements of the ArmsExport Control Act (22 U.S.C. 2751 etseq.) and the Export Administration Act(50 U.S.C. App. 2401 et seq.)

§ 590.407 Transactions Incidental to alicensed transaction.

(a) Any transaction ordinarilyincident to a transaction authorized bythe Office of Foreign Assets Control andnecessary to give effect thereto is alsoauthorized, except to the extent subjectto the export jurisdiction of the

Department of State or Department ofCommerce.

(b) Example: A license issued by theOffice of Foreign Assets Controlauthorizing an exportation of arms toAngola also authorizes all activities byother parties required to complete thesale, including transactions by thebuyer, brokers, transfer agents, banks,etc.

Subpart E-Licenses, Authorizations,and Statements of Licensing Policy§ 590.501 Effect of license orauthorization.

(a) No license or other authorizationcontained in this part, or otherwiseissued by or under the direction of theDirector of the Office of Foreign AssetsControl, shall be deemed to authorize orvalidate any transaction effected prior tothe issuance of the license, unlessspecifically provided in such license orauthorization.

(b) No regulation, ruling, instruction,or license authorizes any transactionprohibited under this part unless theregulation, ruling, instruction, or licenseis issued by the Office of Foreign AssetsControl and specifically refers to thispart. No regulation, ruling, instruction,or license referring to this part shall bedeemed to authorize any transactionprohibited by any provision of thischapter unless the regulation, ruling,instruction or license specifically refersto such provision.

(c) Any regulation, ruling, instruction,or license authorizing any transactionotherwise prohibited under this part has'the effect of removing a prohibition orprohibitions contained in subpart Bfrom the transaction, but only to theextent specifically stated by its terms.Unless the regulation, ruling,instruction, or license otherwisespecifies, such an authorization doesnot create any right, duty, obligation,claim, or interest in, or with respect to,any property which would nototherwise exist under ordinaryprinciples of law.§ 590.502 Exclusion from licenses andauthorizations.

The Director of the Office of ForeignAssets Control reserves the right toexclude any person, property, ortransaction from the operation of anylicense, or from the privileges thereinconferred, or to restrict the applicabilitythereof with respect to particularpersons, property, transactions, orclasses thereof. Such action shall bebinding upon all persons receivingactual or constructive notice of suchexclusion or restriction.


Subpart F-Reports

§590.601 Required records.Except as otherwise provided, every

person engaging in any transactionsubject to the provisions of this partshall keep a full and accurate record ofeach transaction engaged in, regardlessof whether such transaction is effectedpursuant to license or otherwise, andsuch record shall be available forexamination for at least 5 years after thedate of such transaction.

§ 590.602 Reports to be furnished ondemand.

Every person is required to furnishunder oath, in the form of reports orotherwise, from time to time and at anytime as may be required, completeinformation relative to any transaction,regardless of whether such transactionis effected pursuant to license orotherwise, subject to the provisions ofthis part. Such reports may be requiredto include the production of any booksof account, contracts, letters or otherpapers, connected with any suchtransaction or property, in the custodyor control of the person required tomake such reports. Reports with respectto transactions may be required eitherbefore or after such transactions arecompleted. The Director of the Office ofForeign Assets Control may, throughany person or agency, conductinvestigations, hold hearings,administer oaths, examine witnesses,receive evidence, take depositions, andrequire by subpoena the attendance andtestimony- of witnesses and theproduction of all books, papers, anddocuments relating to any matter underinvestigation, regardless of whether anyreport has been required or filed inconnection therewith.

Subpart G-Penalties

§ 590.701 Penaltles.(a) Attention is directed to section 206

of the International EmergencyEconomic Powers Act (50 U.S.C. 1705),which provides that a civil penalty ofnot to exceed $10,000 may be imposedon any person who violates any license,order, or regulation issued under theInternational Emergency EconomicPowers Act, and whoever willfullyviolates any license, order, or regulationissued under the InternationalEmergency Economic Powers Act, shall,upon conviction, be fined not more than$50,000, or, if a natural person, may beimprisoned for not more than 10 years,or both; and any officer, director, oragent of any corporation who knowinglyparticipates in such violation may bepunished by a like fine, imprisonment.

or both. Section 206 of the InternationalEmergency Economic Powers Act isapplicable to violations of any provisionof this part and to violations of theprovisions of any license, ruling.regulation, order, direction, orinstruction issued by or pursuant to thedirection or authorization of theSecretary of the Treasury pursuant tothis part or otherwise under theInternational Emergency EconomicPowers Act. The penalties provided inthe International Emergency EconomicPowers Act are subject to increasepursuant to 18 U.S.C. 3571 and PublicLaw 101-410, 101 Stat. 890 (28 U.S.C.2461 note).

(b) Attention is directed to section 5of the United Nations Participation Act(22 U.S.C. 287c(b)), which provides thatany person who willfully violates orevades or attempts to violate or evadeany order, rule, or regulation issued bythe President pursuant to the authoritygranted in that section shall, uponconviction, be fined not more than$10,000 or, if a natural person, beimprisoned for not more than 10 years,or both; and the officer, director or agentof any corporation who knowinglyparticipates in such violation or evasionshall be punished by a similar fine,imprisonment or both, and anyproperty, funds, securities, papers, orother articles or documents, or anyvessel, together with tackle, apparel,furniture, and equipment, or vehicle, oraircraft, concerned in such violationshall be forfeited to the United States.The penalties provided in the UnitedNations Participation Act are subject toincrease pursuant to 18 U.S.C. 3571.

(c) Attention is directed to 18 U.S.C.1001, which provides that whoever, inany matter within the jurisdiction of anydepartment or agency of the UnitedStates, knowingly and willfully falsifies,conceals or covers up by any trick,scheme, or device a material fact, ormakes any false, fictitious or fraudulentstatement or representation or makes oruses any false writing or documentknowing the same to contain any false,fictitious or fraudulent statement orentry, shall be fined not more than$10,000 or imprisoned not more than 5years, or both.

(d) Violations of this part may also besubject to relevant provisions of theCustoms laws and other applicablelaws.

J 590.702 Prepenalty notice.(a) When required. If the Director of

the Office of Foreign Assets Control hasreasonable cause to believe that there'has occurred a violation of anyprovision of this part or a violation ofthe provisions of any license, ruling,

regulation, order, direction orinstruction issued by or pursuant to thedirection or authorization of theSecretary of the Treasury pursuant tothis part or otherwise under theInternational Emergency EconomicPowers Act, and the Director determinesthat further proceedings are warranted,he shall issue to the person concerneda notice of his intent to impose amonetary penalty. The prepenaltynotice shall be issued whether or notanother agency has taken any actionwith respect to this matter.

(b) Contents-(1) Facts of violation.The prepenalty notice shall describe theviolation, specify the laws andregulations allegedly violated, and statethe amount of the proposed monetarypenalty.

(2) Right to make presentations. Theprepenalty notice also shall inform theperson of his right to make a writtenpresentation within 30 days of mailingof the notice as to why a monetarypenalty should not be imposed, or, ifimposed, why it should be in a lesseramount than proposed.

§ 590.703 Presentation responding toprepenalty notice.

(a) Time within which to respond. Thenamed person shall have 30 days fromthe date of mailing of the prepenaltynotice to make a written presentation tothe Director of the Office of ForeignAssets Control.

(b) Form and contents of writtenpresentation. The written presentationneed not be in any particular form, butshall contain information sufficient toindicate that it is in response to theprepenalty notice. It should containresponses to the allegations in theprepenalty notice and set forth thereasons why the person believes thepenalty should not be imposed or, ifimposed, why it should be in a lesseramount than proposed.

§ 590.704 Penalty notice.(a) No violation. If, after considering

any presentations made in response tothe prepenalty notice and any relevantfacts, the Director of the Office ofForeign Assets Control determines thatthere was no violation by the personnamed in the prepenalty notice, hepromptly shall notify the person inwriting of that determination and thatno monetary penalty will be imposed.

(b) Violation. If, after considering anypresentations made in response to theprepenalty notice, the Directordetermines that there was a violation bythe person named in the prepenaltynotice, he promptly shall issue a writtennotice of the imposition of the monetarypenalty to that person.


§590.705 Referral to United StatesDepartment of Justice.

In the event that the person nameddoes not pay the penalty imposedpursuant to this subpart or makepayment arrangements acceptable to theDirector of the Office of Foreign AssetsControl within 30 days of the mailing ofthe written notice of the imposition ofthe penalty, the matter shall be referredfor administrative collection measuresby the Department of the Treasury or tothe United States Department of Justicefor appropriate action to recover thepenalty in a civil suit in a Federaldistrict court.

Subpart H-Procedures

§ 590.801 Licensing.(a) General licenses. General licenses

may be issued authorizing underappropriate terms and conditionscertain types of transactions which aresubject to the prohibitions contained insubpart B of this part. It is the policy ofthe Office of Foreign Assets Control notto grant applications for specificlicenses authorizing transactions towhich the provisions of an outstandinggeneral license are applicable. Personsavailing themselves of certain generallicenses may be required to file reportsand statements in accordance with theinstructions specified in those licenses.

(b) Specific licenses-(1) Generalcourse of procedure. Transactionssubject to the prohibitions contained insubpart B of this part which are notauthorized by general license may beeffected only under specific licenses.

(2) Applications for specific licenses.Applications for specific licenses toengage in any transactions prohibited byor pursuant to this part may be filed byletter with the Office of Foreign AssetsControl. Any person having an interestin a transaction or proposed transactionmay file an application for a licenseauthorizing such transaction, but theapplicant for a specific license isrequired to make full disclosure of allparties in interest to the transaction sothat a decision on the application maybe made with full knowledge of allrelevant facts and so that the identityand location of the persons who knowabout the transaction may be easilyascertained in the event of inquiry.

(3) Information to be supplied. Theapplicant must supply all informationspecified by relevant instructions and/orforms, and must fully disclose thenames of all the parties who areconcerned with or interested in theproposed transaction. If the applicationis filed by an agent, the agent mustdisclose the name of his principal(s).Such documents as may be relevant

shall be attached to each application asa part of such application except thatdocuments previously filed with theOffice of Foreign Assets Control may,where appropriate, be incorporated byreference. Applicants may be requiredto furnish such further information as isdeemed necessary to a properdetermination by the Office of ForeignAssets Control. Any applicant or otherparty in interest desiring to presentadditional information or discuss orargue the application may do so at anytime before or after decision.Arrangements for oral presentationshould be made with the Office ofForeign Assets Control.

(4) Effect of denial. The denial of alicense does not preclude the reopeningof an application or the filing of afurther application. The applicant orany other party in interest may at anytime request explanation of the reasonsfor a denial by correspondence orpersonal interview.

(5) Reports under specific licenses. Asa condition for the issuance of anylicense, the licensee may be required tofile reports with respect to thetransaction covered by the license, insuch form and at such times and placesas may be prescribed in the license orotherwise.

(6) Issuance of license. Licenses willbe issued by the Office of Foreign AssetsControl acting on behalf of the Secretaryof the Treasury or licenses may-beissued by the Secretary of the Treasuryacting directly or through anyspecifically designated person, agency,or instrumentality.

(7) Address. License applications,reports, and inquiries should beaddressed to the appropriate division orindividual within the Office of ForeignAssets Control, or to the Director, Officeof Foreign Assets Control, U.S. TreasuryDepartment, 1500 Pennsylvania Ave.,NW-Annex, Washington, DC 20220.

§ 590.802 Decisions.The Office of Foreign Assets Control

will advise each applicant of thedecision respecting filed applications.The decision of the Office of ForeignAssets Control acting on behalf of theSecretary of the Treasury with respect toan application shall constitute finalagency action.

§ 590.803 Amendment modification, orrevocation.

The provisions of this part and anyrulings, licenses, whether general orspecific, authorizations, instructions,orders, or forms issued hereunder maybe amended, modified, or revoked atany time.

§590.804 Rulemaking.(a) All rules and other public

documents are issued by the Secretaryof the Treasury upon recommendationof the Director of the Office of ForeignAssets Control. In general, rulemakingby the Office of Foreign Assets Controlinvolves foreign affairs functions of theUnited States, and for that reason isexempt from the requirements under theAdministrative Procedure Act (5 U.S.C.553) for notice of proposed rulemaking,opportunity for public comment, anddelay in effective date. Whereverpossible, however, it is the practice ofthe Office of Foreign Assets Control toreceive written submissions or holdinformal consultations with interestedparties before the issuance of any ruleor other public document.

(b) Any interested person maypetition the Director of the Office ofForeign Assets Control in writing for theissuance, amendment, or repeal of anyrule.

§ 590.805 Delegation by the Secretary ofthe Treasury.

Any action which the Secretary of theTreasury is authorized to take pursuantto Executive Order 12865 or any furtherExecutive orders relating to the nationalemergency declared in Executive Order12865 may be taken by the Director,Office of Foreign Assets Control.

§ 590.806 Rules governing availability ofinformation.

(a) The records of the Office ofForeign Assets Control which arerequired by 5 U.S.C. 552 to be madeavailable to the public shall be madeavailable in accordance with thedefinitions, procedures, payment offees, and other provisions of theregulations on the Disclosure of Recordsof the Office of the Secretary and ofother bureaus and offices of theTreasury Department issued pursuant to5 U.S.C. 552 and published at 31 CFRpart 1.

(b) Any form issued for use inconnection with the UNITA (Angola)Transactions Regulations may beobtained in person or by writing to theOffice of Foreign Assets Control, U.S.Treasury Department, 1500Pennsylvania Ave., NW-Annex,Washington, DC 20220, or by calling202/622-2480.

Subpart i-Paperwork Reduction Act

§ 590.901 [Reserved].

Appendix A to Part 590-Arms andRelated Materiel

(1) Spindle assemblies, consisting ofspindles and bearings as a minimal assembly,


except those assemblies with axial and radialaxis motion measured along the spindle axisin one revolution of the spindle equal to orgreater (coarser) than the following: (a)0.0008 mm TIR (peak-to-peak)for lathes andturning machines; or (b) D x 2 x 10(-5) mmTIR (peak-to-peak) where D is the spindlediameter in millimeters for milling machines,boring mills, jig grinders, and machiningcenters (ECCNs 2B01 and 2B41);

(2) Equipment for the production ofmilitary explosives and solid propellants, asfollows:

(a) Complete installations; and(b) Specialized components (for example,

dehydration presses; extrusion presses for theextrusion of small arms. cannon and rocketpropellants; cutting machines for the sizingof extruded propellants; sweetie barrels(tumblers) 6 feet and over in diameter andhaving over 500 pounds product capacity;and continuous mixers for solid propellants)(ECCN 1B18);

(3) Specialized machinery, equipment,gear. and specially designed parts andaccessories therefor, specially designed forthe examination, manufacture, testing, andchecking of the arms, appliances, machines,and implements of war (ECCN 2B18),ammunition hand-loading equipment forboth cartridges and shotgun shells, andequipment specially designed formanufacturing shotgun shells (ECCN 2B85).

(4) Construction equipment built tomilitary specifications, specially signed forairborne transport (ECCN No. 8A18);

(5) Vehicles specially designed for militarypurposes, as follows:

(a) Specially designed military vehicles,excluding vehicles listed in supplement 2 to15 CFR part 770 (ECCN 9A18)

(b) Pneumatic tire casings (excludingtractor and farm implement types), of a kindspecially constructed to be bulletproof or torun when deflated (ECCN 9A18);

(c) Engines for the propulsion of thevehicles enumerated above, speciallydesigned or essentially modified for militaryuse (EOCN 9A18); and

(d) Specially designed components andparts to the foregoing (ECCN 9A18);

(6) Pressure refuellers, pressure refuellingequipment, and equipment speciallydesigned to facilitate operations in confinedareas and ground equipment, not elsewherespecified, developed specially for aircraft andhelicopters, and specially designed parts andaccessories, n.e.s. (ECCN 9A18);

(73 Specifically designed components andparts for ammunition, except cartridge cases.powder bogs, bullets, jackets, cores, shells,projectiles, boosters, fuses and components,primers, and other detonating devices andammunition belting and linking machines(ECCN 0A18);

(8) Nonmilitary shotguns, barrel length 18inches or over, and nonmilitary arms,discharge type (for example, stun-guns, shockbatons, etc.), except arms designed solely forsignal, flare, or saluting use; and parts, n.e.s.(EOCN 0A84);

(9) Shotgun shells, and parts (ECCN 0A86);(10) Military parachutes (ECCN 9A18);(11) Submarine and torpedo nets (ECCN

8A18);(12) Bayonets and muzzle-loading (black

powder) firearms (ECEN 0A18).

Dated: November 23, 1993R. Richard Newcomb,Director, Office of Foreign Assets Control.

Approved: November 29, 1993John P. SimpsonDeputy Assistant Secretary (Regulatory, Tariff& Trade Enforcement).

[FR Doc. 93-30159 Filed 12-7-93; 9:38 am]BILUNG CODE 4810-254

FEDERAL MARITIME COMMISSION

46 CFR Part 585

[Docket No. 93-201

Regulations to Adjust or MeetConditions Unfavorable to Shipping Inthe Foreign Trade of the United States

AGENCY: Federal Maritime Commission.ACTION: Final rule.

SUMMARY: The Federal MaritimeCommission issues a final ruleamending 46 CFR part 585,"Regulations To Adjust or MeetConditions Unfavorable to Shipping inthe Foreign Trade of the United States."The rule updates the Commission'sexisting regulations and reflectsamendments to section 19 of theMerchant Marine Act, 1920, whichclarified certain Commissionauthorities, granted the Commissioncertain information-gathering powers,and extended the range of sanctionsavailable to the Commission inproceedings under that statute.

EFFECTIVE DATE: January 10, i994.FOR FURTHER INFORMATION CONTACT:Robert D. Bourgoin, General Counsel,Federal Maritime Commission, 800North Capitol Street, NW.. Washington,DC 20573, (202) 523-5740.SUPPLEMENTARY INFORMATION: Section 19of the Merchant Marine Act, 1920, 46U.S.C. app. 876 ("Section 19"),authorizes the Federal MaritimeCommission ("Commission" or "FMC")to take regulatory action to correctunfavorable shipping conditions in U.S-foreign oceanborne commerce.Specifically, paragraph (1)(b) of Section19 directs the Commission * * *

* l * * [to make rules and regulationsaffecting shipping in the foreign trade not inconflict with law in order to adjust or meetgeneral or special conditions unfavorable toshipping in the foreign trade, whether in anyparticular trade or upon any particular routeor in commerce generally, includingintermodal movements, terminal operations,cargo solicitation, forwarding and agencyservices, non-vessel-operating commoncarrier operations and other activities andservices integral to transportation systems,and which arise out of or result from foreignlaws, rules, or regulations or from

competitive methods or practices employedby owners, operators, agents or masters ofvessels of a foreign country.Id. app. 876(1)(b). Section 19 was mostrecently amended by section 103 ofPublic Law No. 101-595, 104 Stat. 2979("Section 19 Amendments"), to clarifyand expand the powers of theCommission to address unfavorableshipping conditions, particularly thosewhich affect intermodal, shoreside andother ocean transportation activities,and to add certain information-gatheringand discovery tools. 46 U.S.C. app.876(5H12).

The Commission's regulationsgoverning Section 19 proceedings areset forth at 46 CFR Part 585-Regulations To Adjust or MeetConditions Unfavorable to Shipping inthe Foreign Trade of the United States.The Commission published a notice ofproposed rulemaking ("NPR") to updateits rules essentially to reflect the Section19 Amendments on October 7, 1993, 58FR 52248. The proposed rulesubstantially incorporated the existingPart 585, with some editorial andconforming changes, added a number ofnew sections in order to implement newstatutory authorities, and restructuredthe rules for a more logical presentation.

The proposed rule restructures part585 into six subparts in order toaccommodate the new sections of therules and to make for a more orderlyand logical presentation of the rules'provisions. General provisions thatapply to the entire part 585 appear insubpart A. Subpart B implementsinformation-gathering authorities.subpart C enumerates those conditionsthat will be found to be unfavorable toshipping. Subpart D contains provisionsgoverning the filing of section 19petitions. Subpart E sets forth theprovisions that govern proceedingsinitiated by the Commission undersection 19. Subpart F describes thecorrective actions that may be taken aswell as penalties that may be imposed.The NPR included a section-by-sectiondiscussion identifying the particularchanges in the existing rules as well asthe new provisions of part 585.Interested persons were invited tosubmit comments on the NPR.

Discussion

Only one comment was received inresponse to the NPR. Sea-Land Service,Inc. ("Sea-Land"). suggests a few minoreditorial and clarifying changes, andurges the Commission to otherwiseadopt the rule. The changes suggested inthe Sea-Land comments have merit, andhave therefore been incorporated in thefinal rule. These are discussedindividually below.


Sea-Land points out that while theproposed rule at § 585.201(a) obviouslymeant to reflect language added by thesection 19 Amendments at section19(6)(a) of the Act, 46 U.S.C. 876(6)(a),the rule refers to "any * * licensee,"rather than to "any * * lessee," asstated in the statute. Sea-Land alsoproperly notes that § 585.601(h) of theproposed rule should refer to "subpartC" rather than "subpart B" as thesubpart which describes conditionswhich will be found unfavorable.Finally, we accept Sea-Land'ssuggestion that the plural reference to"carriers'" in § 585.301 be changed tothe singular, in order to clarify that afinding of conditions unfavorable toshipping may be based on restrictionsaffecting one carrier.

The Chairman of the Federal MaritimeCommission has determined that thePaperwork Reduction Act (44 U.S.C.3504) does not apply because thisregulation does not contain anyinformation collection requirements thatrequire the-approval of the Office ofManagement and Budget.


procedure, Maritime carriers.Therefore, Pursuant to section 4 of the

Administrative Procedure Act (5 U.S.C.553). section 10002 of the ForeignShipping Practices Act of 1988 (46U.S.C. app. 10002), and section 19 of theMerchant Marine Act, 1920 (46 U.S.C.app. 876), the Federal MaritimeCommission hereby revises part 585 oftitle 46, Code of Federal Regulations, toread as follows:

PART 585-REGULATIONS TOADJUST OR MEET CONDITIONSUNFAVORABLE TO SHIPPING IN THEFOREIGN TRADE OF THE UNITEDSTATES

Subpart A-General ProvisionsSec.585.101 Purpose.585.102 Scope.585.103 Definitions.585.104 Confidentiality.585.105 Consultation.

I Proposed section 585.301 provides, inter alia:For the purposes of this part, conditions created

by foreign governmental action or competitivemethods of owners, operators, agents or masters offoreign vessels are found unfavorable to shipping inthe foreign trade of the United States, if suchconditions:

(d) Restrict or burden carriers' intermodalmovements or shore-based maritime activities.including terminal operations and cargosolicitation; forwarding and agency services; non-vessel-operating common carrier operations; orother activities and services integral totransportation;

Subpart B-Production of Information585.201 Information orders.585.202 Type of information.585.203 Failure to provide information.

Subpmrt C-Conditions Unfavorable ToShipping585.301 Findings.

Subpart D-Petitions For Relief585.401 Who may file.585.402 Filing of petitions.585.403 Contents of petitions.585.404 Amendment or dismissal of

petitions.

Subpart E-Proceeding585.501 Participation of interested persons.585.502 Discovery.585.503 Subpoenas.585.504 Witness fees.585.505 Failure, to supply information.585.506 Enforcement of orders.585.5,07 Postponement, discontinuance or

suspension of action.585.508 Publication, content and effective

date of regulation.

Subpart F-Corrective Actions585.601 Actions to correct unfavorable

conditions.585.602 Penalty.

Authority: 5 U.S.C. 553; sec. 19(1)(b), (5),(6), (7), (8), (9), (10), (11) and (12) of theMerchant Marine Act, 1920,46 U.S.C. app.876(1)(b), (5). (6), (7). (8), (9), (10), (11) and(12); Reorganization Plan No. 7 of 1961, 75Stat. 840; and sec. 10002 of the ForeignShipping Practices Act of 1988. 46 U.S.C.app. 1710a.

Subpart A-General Provisions

§585.101 Purpose.It is the purpose of the regulations of

this part to declare certain conditionsresulting from governmental actions byforeign nations or from the competitivemethods or practices of owners,operators, agents, or masters of vesselsof a foreign country unfavorable toshipping in the foreign trade of theUnited States and to establishprocedures by which persons who are orcan reasonably expect to be adverselyaffected by such conditions maypetition the Federal MaritimeCommission for the issuance ofregulations under the authority ofsection 19 of the Merchant Marine Actof 1920. It is the further purpose of theregulations of this part to afford noticeof the general circumstances underwhich the authority granted to theCommission under section 19 may beinvoked and the naturA of the regulatoryactions contemplated.

§ 55.102 Scope.Regulatory actions may be taken when

the Commission finds, on its ownmotion or upon petition, that a foreigngovernment has promulgated and

enforced or intends to enforce laws,decrees, regulations or the like, or hasengaged in or intends to engage inpractices which presently have orprospectively could create conditionsunfavorable to shipping in the foreigAtrade of the UnitedStates, or whenowners, operators, agents or masters offoreign vessels engage in or intend toengage in, competitive methods orpractices which have created or couldcreate such conditions.

§585.103 Defintions.When used in this part:(a) Act means the Merchant Marine

Act, 1920, as amended by Public LawNo. 101-595.

(b) Person means individuals,corporations, partnerships andassociations existing under orauthorized by the laws of the UnitedStates or of a foreign country, andincludes any common carrier, trampoperator, bulk operator, shipper,shippers' association, importer,exporter, consignee, ocean freightforwarder, marine terminal operator, orany component of the Government ofthe United States.

(c) Voyage means an inbound oroutbound movement between a foreigncountry and the United States by avessel engaged in the United Statesoceanborne trade. Each inbound oroutbound movement constitutes aseparate voyage.

§585.104 Confidentiality.Notwithstanding any other law, the

Commission may refuse to disclose tothe public a response or otherinformation provided under the terms ofthis part.

§585.105 Consultation.(a) Consultation with other agencies.

The Commission may consult with, seekthe cooperation of, or makerecommendations to other appropriateagencies prior to taking any actionunder this part.

(b) Request for resolution throughdiplomatic channels. Upon the filing ofa petition, or on its own motion whenthere are indications that conditionsunfavorable to shipping in the foreigntrade of the United States may exist, theCommission may notify the Secretary ofState that such conditions apparentlyexist, and may request that the Secretaryseek resolution of the matter throughdiplomatic channels. If request is made,the Commission will give everyassistance in such efforts, and theCommission may request the Secretaryto report the results of such efforts at aspecified time.


Subpart B--Production of Information

§585.201 Information ordors.In furtherance of the purposes of this

part-(a) The Commission may, by order,

require any person (including anycommon carrier, tramp operator, bulkoperator, shipper, shippers' association,ocean freight forwarder, or marineterminal operator, or any officer,receiver, trustee, lessee, agent, oremployee thereof, to file with theCommission a report, answers toquestions, documentary material, orother information which theCommission considers necessary orappropriate;

b) The Commission may require areport or answers to questions to bemade under oath;

(c) The Commission may prescribe theform and the time for response to areport or answers to questions.

§ 585.202 Type of Information.In order to aid In the determination of

whether conditions unfavorable toshipping in the foreign trade of theUnited States exist, or in order to aid inthe formulation of appropriateregulations subsequent to a finding thatconditions unfavorable to shipping inthe foreign trade of the United Statesexist, the Commission may, when itdeems necessary or appropriate, andwithout further proceedings, order any:

(a) Owner, operator, or charterer inthe affected trade to furnish any or allof the following information:

(1) Statistics for a representativeperiod showing passengers or cargocarried to and from the United States inthe affected trade on vessels owned,operated or chartered by it, by type.source, value, and direction;

(2) Information for a representativeperiod on the activities of vesselsowned, operated, or chartered, whichshall include sailings to and fromUnited States ports, costs incurred,taxes or other charges paid toauthorities, and subsidies or otherpayments received from foreignauthorities;

(3) Information for a specified futureperiod on the prospective activities ofvessels which it owns, operates orcharters or plans to own, operate orcharter, to and from United States ports,which shall include projected sailings,anticipated costs, taxes or other chargesto be paid to authorities, and expectedsubsidies or other payments to bereceived from foreign authorities; and

(4) Such other information that theCommission considers relevant todiscovering or determining theexistence of general or special

conditions unfavorable to shipping inthe foreign trade of the United States.

(b) Shipper, shippers' association,ocean freight forwarder, or non-vessel-operating common carrier in theaffected trade to furnish any or all of thefollowing information:

- (1) Information for a representativeperiod showing shipments made, typeof cargo, commodity, carrier and vesselon which shipment was made,including furnishing copies of bills oflading and other shipping documents;

(2) Information relating to theapplication for, grant of, or securing ofwaivers or other exemption fromrequirements imposed by foreigngovernments that cargo move onnational-flag, conference, or non-conference vessels;

(3) Amount of brokerage, freightforwarder compensation or othercharges collected or paid in connectionwith shipments in the affected trade;and

(4) such other Information that theCommission considers relevant todiscovering or determining theexistence of general or specialconditions unfavorable to shipping inthe foreign trade of the United States.

(c) Any marine terminal operator tofurnish any or all of the followinginformation:

(1) Marine terminal facilitiesagreements, whether or not on file withthe Commission, into which it hasentered with any ocean carrier in theaffected trade;

(2) Information for a representativeperiod showing the difference betweenthe rates agreed to for use of its facilities-by any ocean carrier serving the affectedtrade pursuant to an agreementauthorizing preferential treatment orlease terms and those rates which wouldotherwise have applied to such servicesor leases.

§ 585.203 Failure to provide Information.

(a) A person who fails to file a report,answer, documentary material, or otherinformation required under this subpartshall be liable to the United StatesGovernment for a civil penalty of notmore than $5,000 for each day that theinformation is not provided.

Nb) The Commission may, when thereis a failure to produce any informationordered produced under § 585.201,make appropriate findings of fact andinferences, including the inference thatconditions unfavorable to shipping inthe foreign trade of the United States doexist.

Subpart C--Conditions Unfavorable toShipping

§585.301 Findings.For the purposes of this part,

conditions created by foreigngovernmental action or competitivemethods of owners, operators, agents ormasters of foreign vessels are foundunfavorable to shipping in the foreigntrade of the United States, if suchconditions:

(a) Impose upon vessels in the foreigntrade of the United States fees, charges,requirements, or restrictions differentfrom those imposed on other vesselscompeting in the trade, or precludevessels in the foreign trade of the UnitedStates from competing in the trade onthe same basis as any other vessel;

(b) Reserve substantial cargoes to thenational flag or other vessels and fail toprovide, on reasonable terms, foreffective and equal access to such cargoby vessels in the foreign trade of theUnited States;

(c) Are discriminatory or unfair asbetween carriers, shippers, exporters,importers, or ports or between exportersfrom the United States and their foreigncompetitors and which cannot bejustified under generally acceptedinternational agreements or practicesand which operate to the detriment ofthe foreign commerce or the publicinterest of the United States;

(d) Restrict or burden a carrier'sintermodal movements or shore-basedmaritime activities, including terminaloperations and cargo solicitation;forwarding and agency services; non-vessel-operating common carrieroperations; or other activities andservices integral to transportationsystems; or

(e) Are otherwise unfavorable toshipping in the foreign trade of theUnited States.

Subpart D-Petltlons for Section 19Relief

§ 585.401 Who may file.Any person who has been harmed by,

or who can reasonably expect harmfrom, existing or impending conditionsunfavorable to shipping in the foreigntrade of the United States, may file apetition for relief under the provisionsof this part.

§ 585.402 Filing of petitions.All requests for relief from conditions

unfavorable to shipping in the foreigntrade shall be by written petition. Anoriginal and fifteen copies of a petitionfor relief under the provisions of thispart shall be filed with the Secretary,Federal Maritime Commission,Washington, DC 20573.

64912 Federal Register / Vol. 58, No. 236 / Friday, December i0, 1993 / Rules and Regulations

§ 585.403 Contents of petitions.Petitions for relief from conditions

unfavorable to shipping in the foreigntrade of the United States shall set forththe following:

(a) A concise description and citationof the foreign law, rule, regulation,practice or competitive methodcomplained of;

(b) A certified copy of any law, rule,regulation or other document involvedand, if not in English, a certified Englishtranslation thereof;

(c) Any other evidence of theexistence of such practice orcompetitive method;

(d) A clear description, in detail, ofthe harm already caused or which mayreasonably be expected to be causedpetitioner, including:

(1) Statistics for the representativeperiod showing the type and amount ofrevenue loss or operating cost increasesuffered or projected, such as a presentor prospective cargo loss if harm isalleged on that basis. Such statisticsshall include figures which permitcomparison or computation of theproportional effect of the harm alleged.For example, when the harm alleged isloss of cargo, supporting evidence shallinclude the total cargo carried orprojected in the trade for the period;

(2) Statistics or other evidence for therepresentative period showing increasedcosts, inferior services or other harm tocargo or other non-vessel interest ifinjury is claimed on that basis; and

(3) A statement as to why the periodis representative.

(e) A recommended regulation, thepromulgation of which will, in the viewof the petitioner, adjust or meet thealleged conditions unfavorable toshipping in the foreign trade of theUnited States.

§ 585.404 Amendment or dismissal ofpetitions.

Upon the failure of a petitioner tocomply with the provisions of this part,the petitioner will be notified by theSecretary and afforded reasonableopportunity to amend its petition.Failure to timely amend the petitionmay result in its dismissal. For goodcause shown additional time foramendment may be granted.

Subpart E-Proceedings

§ 585.501 Participation of Interestedpersons.

In the event that participation ofinterested persons is deemed necessaryby the Commission, notice will bepublished in the Federal Register andinterested persons will then be allowedto participate in this proceeding by the

submission of written data, views orarguments, with or without opportunityto present same orally.

§585.502 Discovery.The Commission may authorize a

party to a proceeding to use depositions,written interrogatories, and discoveryprocedures that, to the extentpracticable, are in conformity with therules applicable in civil proceedings inthe district courts of the United States.

§ 585.503 Subpoenas.In proceedings under this part, the

Commission may by subpoena compelthe attendance of witnesses and theproduction of books, papers,documents, and other evidence.

§ 585.504 Witness fees.In proceedings under this subpart,

witnesses are, unless otherwiseprohibited by law, entitled to the samefees and mileage as in the courts of theUnited States, subject to funds beingprovided by appropriations Acts.

§585.505 Failure to supply Information.For failure to supply information

ordered to be produced or compelled bysubpoena in proceedings under thispart, the Commission may-

(a) After notice and an opportunity forhearing, suspend tariffs of a commoncarrier or that common carrier's right touse the tariffs of conferences of whichit is a member; or

(b) Assess a civil penalty of not morethan $5,000 for each day that theinformation is not provided.

§ 585.506 Enforcement of orders.In proceedings under this part, when

a person violates an order of theCommission or fails to comply with asubpoena, the Commission may seekenforcement by a United States districtcourt having jurisdiction over theparties.

§585.507 Postponement, discontinuance,or suspension of action.

The Commission may, on its ownmotion or upon petition, postpone,discontinue, or suspend any and allactions taken by it under the provisionsof this part. The Commission shallpostpone, discontinue or suspend anyor all such actions if the Presidentinforms the Commission thatpostponement, discontinuance orsuspension is required for reasons offoreign policy or national security.

§ 585.508 Publication, content andeffective date of regulation.

The Commission shall incorporate inany regulations adopted under the rulesof this part a concise statement of their

basis and purpose. Regulations shall bepublished in the Federal Register.Except where conditions warrant andfor good cause, regulations promulgatedunder the rules of this part shall notbecome effective until at least 30 daysafter the date of publication.

Subpart F-Corrective Actions

§ 585.601 Actions to correct unfavorableconditions.

Upon submission of a petition filedunder the rules of this part, or upon itsown motion, the Commission may findthat conditions unfavorable to shippingin the foreign trade of the United Statesdo exist; and may, without furtherproceedings, issue regulations whichmay:

(a) Impose equalizing fees or charges;(b) Limit sailings to and from United

States ports or the amount or type ofcargo carried;

(c) Suspend, in whole or in part,tariffs filed with the Commission forcarriage to or from United States ports,including a common carrier's right touse tariffs of conferences in UnitedStates trades of which it is a member forany period the Commission specifies;

(d) Suspend, in whole or in part, anocean common carrier's right to operateunder an agreement, including anyagreement authorizing preferentialtreatment at terminals or preferentialterminal leases, whether filed with theCommission or not filed with theCommission pursuant to the exemptionsgranted in 46 CFR Part 572; or anyagreement filed with the Commissionauthorizing space chartering, or poolingof cargo or revenues with other oceancommon carriers;

(e) Impose a fee, not to exceed$1,000,000 per voyage;

(f) Request the collector of customs atthe port or place of destination in theUnited States to refuse the clearancerequired by section 4197 of the RevisedStatutes, 46 U.S.C. app. 91, to a vesselof a foreign carrier which is or whosegovernment is identified as contributingto the unfavorable conditions describedin subpart C;

(g) Request the collector of customs atthe port or place of destination in theUnited States to collect any. feesimposed by the Commission underparagraph (e) of this section;

(h) Request the Secretary of thedepartment in which the Coast Guard isoperating to deny entry, for purposes ofoceanborne trade, of any vessel of aforeign carrier which is or whosegovernment is identified as contributingto the unfavorable conditions describedin subpart C, to any port or place in theUnited States or the navigable waters of


the United States, or to detain any suchvessel at the port or place in the UnitedStates from which it is about to departfor any other port or place in the UnitedStates; or

(i) Take any other action theCommission finds necessary andappropriate to adjust or meet any

condition unfavorable to shipping in theforeign trade of the United States.

§585.602 Penalty.A common carrier that accepts or

handles cargo for carriage under a tariffthat has been suspended under§ 585.505 or § 585.601 of this part, orafter its right to use another tariff hasbeen suspended under those sections, is

subject to a civil penalty of not morethan $50,000 for each day that it isfound to be operating under asuspended tariff.

By the Commission.Joseph C. Polking,Secretary.(FR Doc. 93-30163 Filed 12-9-93; 8:45 am)BUMO CODE MS-W

64914

Proposed Rules Federal RegisterVol. 58, No. 236


This section of the FEDERAL REGISTERcontains notices to the public of the proposedissuance of rules and regulations. Thepurpose of these notices is to give interestedpersons an opportunity to participate in therule making prior to the adoption of the finalrules.


16 CFR Part 309

Labeling Requirements for Alternative.Fuels and Alternative Fueled Vehicles

AGENCY: Federal Trade Commission.ACTION: Advance notice of proposedrulemaking.

SUMMARY: The Federal TradeCommission ("Commission") inviteswritten comments on issues that theCommission may address in proposedregulations required under section 406of the Energy Policy Act of 1992,relating to labeling requirements foralternative fuels and alternative fueledvehicles. Comments received inresponse to this Notice will help theCommission develop its Notice ofProposed Rulemaking and a proposed,labeling rule.DATES: Written comments must besubmitted on or before January 26, 1994.ADDRESSES: Written comments shouldbe identified as "16 CFR part 309" andsent to the Division of Enforcement,Federal Trade Commission,Washington, DC 20580. TheCommission requests, but does notrequire, that original comments be filedwith four copies.FOR FURTHER INFORMATION CONTACT:Jeffrey E. Feinstein, Attorney, Divisionof Enforcement, Federal TradeCommission, Washington, DC 20580,telephone 202/326-2372.


I. Introduction

The Energy Policy Act of 1992 (EPA92)1 establishes a comprehensivenational energy drategy designed toincrease U.S. energy security andimprove the economy in cost effectiveand environmentally beneficial ways.2 Itseeks to reduce U.S. dependence on oilimports; promote energy efficiency;

1 Pub. L. 102-486, 106 Stat. 2776 (1992).2H. Rep. No. 102-474(1), 102d Cong.. 2d Sess.

132.

reduce the use of petroleum-based fuelsin automobiles; and provide new energyoptions.3 Key programs in titles III, IV,V, and VI of EPA 92 promote thedevelopment of alternative fuels 4 andalternative fueled vehicles (AFV's).5

Section 406 of EPA 92 directs theCommission to promulgate a ruleestablishing uniform labelingrequirements for alternative fuels andAFV's.6 Once promulgated, the rule willrequire disclosure, to the greatest extentpracticable, of appropriate informationas to costs and benefits to helpconsumers make reasonable purchasing-choices and comparisons. According tothe Act, the labels must be simple,updated periodically, and, whereappropriate, consolidated with otherlabels providing information toconsumers. EPA 92 requires theCommission to issue a proposedlabeling rule by April 25, 1994, and afinal rule within one year thereafter.,

In formulating its proposal, the Actrequires the Commission to "obtain theviews of" affected industries, consumerorganizations, Federal and Stateagencies, and all other interestedparties. The Commission also must giveconsideration to the problemsassociated with developing andpublishing useful and timely cost andbenefit information, taking into accountlead time, costs, the frequency ofchanges in costs and benefits that mayoccur, and other relevant factors. TheSecretary of the Department of Energy(DOE) is to provide technical assistanceto the Commission in developing thelabeling requirements,7 and theCommission is to issue the rule "in

3id.4 The term "alternative fuels" is defined to

include:[Mlethanol, denatured ethanol, and'other

alcohols; mixtures containing 85 percent or more(or such other percentage, but not less than 70percent, as determined by the Secretary (of Energy].by rule, to provide for requirements relating to coldstart, safety, or vehicle functions) by volume ofmethanol, denatured ethanol, and other alcoholswith gasoline or other fuels; natural gas; liquefiedpetroleum gas; hydrogen; coal-derived liquid fuels;fuels (other than alcohol) derived from biologicalmaterials; electricity (including electricity fromsolar energy); and any other fuel the Secretarydetermines, by rule, is substantially not petroleumand would yield substantial energy security benefitsand substantial environmental benefits.]

42 U.S.C.A. 13211(2) (West Supp. 1993).5 The term "alternative fueled vehicle" is defined

as "a dedicated vehicle or a dual fueled vehicle."42 U.S.C.A. 13211(3) (West Supp. 1993).e42 U.S.C.A. 13232(a) (West Supp. 1993).7 42 U.S.C.A. 13232(b) (West.Supp. 1993).

consultation with" the DOE Secretary,the Administrator of the EnvironmentalProtection Agency, and the Secretary ofTransportation.8

The rulemaking required by section406 differs in several respects with theproceeding the Commission recentlycompleted to implement EPA section1501.9 As required by section 1501, theCommission expanded the scope of itsformer Octane Certification and PostingRule lo beyond automotive gasoline toinclude all liquid alternative fuels.Although the proceeding required bysection 1501 was limited to the liquidalternative fuels, section 406 covers allalternative fuels. In addition, section1501 requires certification and postingof a given fuel's rating, while section406 requires disclosure of costs andbenefits. Finally, the section 1501 ratingsticker need only be posted on thedispensing pump, while section 406mandates labeling requirements foralternative fuels and AFV's.

Comments received in response tothis Notice will help the Commissiondevelop its Notice of ProposedRulemaking (NPR) and a proposedlabeling rule. When the NPR is'published-there will be additionalopportunity for public input.

II. Issues for Public Comment

The Commission invites interestedpersons to address any questions of fact,law, or policy that they believe may bearupon the Commission's development oflabeling requirements. The Commissionparticularly desires comment, however,on the questions listed below. For allresponses, the Commission stronglyrequests that answers be accompanied

BDOE also must establish a program to educatethe public about the benefits and costs of the useof alternative fuels. See 42 U.S.C.A. 13231 (WestSupp. 1993). Under that program. DOE will produceand make available an information package forconsumers to assist them in choosing amongalternative fuels and AFV's. That package willprovide "relevant and objective" information onvehicle and fuel characteristics as compared togasoline, including environmental performance.energy efficiency, domestic content, cost.maintenance requirements, reliability, safety, and"such other information as the Secretary [of DOE]determines is reasonable and necessary to helppromote the use of alternative fuels in motorvehicles." Id. The DOE information package mustbe completed by April 25,1994 (the same date bywhich the Commission must issue its Notice ofProposed Rulemaking), and updated annually "toreflect the most recent available information." Id.

9See 15 U.S.C.A. 2821-23 (West Supp. 1993).10 16 CFR part 306.

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Proposed Rules

by citations to supporting authoritywhenever available.

A. ScopeAs noted, section 406 requires the

Commission to promulgate labelingrequirements both for "alternativefuels" and "alternative fueled vehicles."The Commission invites comment onwhich fuels and which vehicles shouldbe covered by the labeling requirements.

1. Alternative Fuelsa. Which alternative fuels are

presently available for consumer use?For each such fuel, describe:

(1) The fuel's composition;(2) How the fuel is produced;(3) The costs and benefits involved in

utilizing the fuel for transportation.b. Should the Commission limit the

scope of the labeling requirements topresently available alternative fuels? Ifnot, (a) how should the Commissiondecide which alternative fuels should becovered by its labeling requirements,and (b) using those criteria, whichalternative fuels should be covered atthe present time?

c. Not all alternative fuels aredispensed from a conventional fuelpump (e.g., electricity is dispensed froma recharging unit). How shouldalternative fuels not dispensed from aconventional fuel pump be labeled?

2. Alternative Fueled Vehiclesa. The term "alternative fueled

vehicle" includes any dedicated or dualfueled vehicle. Should coverage of thelabeling requirements extend to all suchvehicles? If not, (a) how should theCommission decide which vehiclesshould be covered, and (b) using thatcriteria, which vehicles should becovered at the present time?

b. Should the Commission's labelingrequirements extend to vehiclesconverted to use alternative fuels "aftermarket" (i.e., after sale by originalequipment manufacturers)?

B. Disclosure (Label Content)The labels required by section 406

must disclose "appropriate"information with respect to costs andbenefits. Accordingly, the Commissionseeks comment on the types ofinformation that could help consumersmake reasonable purchasing choicesand comparisons.

1. Should the Commission target theinformation to be disclosed in itslabeling requirements to a particularclass, or to particular classes, ofconsumers (e.g., individual purchasers,fleet owners)? If yes, which consumers?

2. What information will consumersneed to make comparisons between

alternative fuels and conventionalgasoline products? Between alternativefuels and diesel fuel?

3. What information will consumersneed to make comparisons betweenAFV's and gasoline-powered vehicles?Between AFV's and diesel-poweredvehicles?

4. What information will consumersneed to make comparisons amongvarious alternative fuels?

5. What information will consumersneed to make comparisons amongvarious AFV's?

6. What information should bedisclosed to consumers to help themmake reasonable purchasing choicesand comparisons of alternative fuels andAFV's?

a. For each information category,where should that information bedisclosed:. (a) On the fuel dispenser? (b)vehicle? (c) some other location?

b. For each information category, howshould the information be displayed?For example, in quantitative ordescriptive terms? Absolute orcomparative terms? If comparative,compared to what (e.g., gasoline and/ordiesel, or other alternative fuels)?

c. For each such information category,what should the authority (e.g., testingresults, government report) for thatinformation be? How should theinformation be determined by vehiclemanufacturers, converters, and fuelsellers?. 7. Section 406 requires the

Commission to update its labelingrequirements "periodically to reflect themost recent available information."How often should the Commissionreexamine its labeling requirements andconsider changes? What informationshould the Commission consider toupdate its labeling requirements? Howsignificant should the change ininformation be to trigger an update?

8. Section 406 requires theCommission to consider consolidatingits labeling requirements to bepromulgated under this section with"other labels providing information tothe consumer." Should the Commissionconsolidate the section 406 labelingrequirements with other labels? Whichones? How might the labels beconsolidated?

9. What label format or formatsshould the Commission consider tocomply with section 406's mandate?

By direction of the Commission.Donald S. Clark,Secretary.IFR Doc. 93-30148 Filed 12-9-93; 8:45 am]BILUNG CODE 6750-01-AM

NATIONAL ARCHIVES AND RECORDSADMINISTRATION

36 CFR Part 1220RIN 3095-AA48

Agency Program Evaluations

AGENCY: National Archives and RecordsAdministration.ACTION: Notice of proposed rulemaking.

SUMMARY: This proposed rule more fullydescribes agency and NARAresponsibilities as part of the recordsmanagement evaluations of Federalagencies that NARA conducts on aregular basis. It discusses the authority,purpose, and scope of these evaluationsand describes specific agencyrequirements related to the evaluationnotification, the evaluation process, andthe transmittal of the report, and forproducing action plans and regularprogress reports.DATES: Comments must be received byJanuary 10, 1994.ADDRESSES: Comments should be sent toDirector, Policy and Program AnalysisDivision (NAA), National Archives andRecords Administration, 8601 AdelphiRoad, College Park, MD 20740-6001.FOR FURTHER INFORMATION CONTACT:Mary Ann Hadyka or Nancy Allard at301-713-6730.SUPPLEMENTARY INFORMATION: Followingis a description of the changes made bythis proposed rule.

A definition of evaluations, based onthe statutory definition of inspections in44 U.S.C. 2901, has been added to thedefinitions under § 1220.14.

A revised section on agency internalevaluations now specifies that theseinternal evaluations should beconducted at a minimum biennially andhas been moved to § 1220.42 from§ 1220.54. Because agency internalevaluations provide importantinformation for NARA in effectivelycarrying out its records managementoversight function, agencies are asked toprovide copies to NARA's Office ofRecords Administration. Subpart C nowrefers entirely to NARA's agency recordsmanagement evaluation program. Theseparate section on interagency programevaluations and studies has beeneliminated. The information under thatheading has been included in § 1220.50as part of NARA's authority to carry outevaluations.

Sections 1220.50 and 1220.52 havebeen revised and expanded to describeNARA's authority to carry outevaluations and the purpose and scopeof this program.

Section 1220.54 describes NARA'srole in the evaluation notification

64915


process and specifies agencyrequirements after that notificationprocess has taken place. Because theevaluation process proceeds moresmoothly if agency staff have beenformally notified of the evaluation bythe agency head, this requirement (b)(2)has been added. In addition, the NARAstaff may need to reference thisnotification, so a requirement (b)(3) hasbeen included that NARA be provideda copy. The requirements in (b) (4), (5),and (6) have generally been standardpractice as part of NARA evaluationsbut are being spelled out as part of theserevised regulations. The requirement foragencies to provide a list of schedulescurrently in effect and to list functionsor information systems not currentlycovered by schedules is to allow NARAto better assess the quality and coverageof records schedules in the agency aspart of the evaluation process.

Section 1220.56 describes NARA'srole in the transmittal of the draft andfinal reports and specifies agencyrequirements in response to thesetransmittals. In particular, NARA nowhas a 120-day time limit for drafting thereport once the agency visits have beencompleted.

The current regulations require bothagency action plans in response to theevaluation recommendations and forregular progress reports every sixmonths until the recommendations arefully implemented. Section 1220.58includes new and more detailedrequirements for these plans andreports. Based on NARA's experiencewith what makes for effective actionplans and progress reports, the contentsof these documents have now beenspecified in greater detail. In the actionplans, the responsible official nowneeds to be identified as well as bothstarting and ending dates andmilestones for completing theindividual recommendations. Separateaction plans for field sites may berequested. The progress reports, forwhich no content was previouslyspecified, should include a descriptionof what has been accomplished on eachaction in the plan since the last report,the current status of therecommendation, any changes in theoffices or programs responsible forimplementation, explanations of anydelays in implementation, and revisedtarget dates and milestones if necessary.

Section 1220.60 briefly describespotential NARA follow-up action andreviews.

As part of agencies' review of theseregulations, NARA is particularlyinterested in receiving comments ontwo issues. The first concerns thecriteria for selecting agencies for

evaluations. NARA has very brieflydescribed these criteria as perceivedneed, specific request, or a compliancemonitoring cycle. We are interested inagency reactions to, or suggestions for,these criteria.

The second issue concerns criteria forperformance measurement. NARA hasnot specifically discussed this issue inthe regulations, but is soliciting agencycomments. In addition to agencyeffectiveness in implementing thespecific evaluation recommendations,what are fair and standard measures bywhich NARA can, across agencies,assess the success of the evaluationprogram in terms of programmaticimprovements or improved workproducts?

This rule is not a significantregulatory action for the purposes ofExecutive Order 12866 of September 30,1993. As required by the RegulatoryFlexibility Act, it is hereby certified thatthis proposed rule will not have asignificant impact on small businessentities.

List of Subjects in 36 CFR Part 1220Archives and records.For the reasons set forth in the

preamble, NARA proposes to amendpart 1220 of title 36 of the Code ofFederal Regulations as follows:

PART 1220--FEDERAL RECORDS;GENERAL


Authority: 44 U.S.C. 2104(a) and chs. 29and 33.

2. In § 1220.14, the term "Evaluation"is added in alphabetical order to read:

§1220.14 General definitions.

Evaluation means the inspection,audit, or review, either comprehensiveor selective, of any Federal agency'srecords management programs orpractices or its records with respect toeffectiveness and compliance withrecords management laws. It includesrecommendations for correction orimprovement of records management.

3. Section 1220.42 is added to SubpartB to read as follows:

§ 1220.42 Agency Internal evaluations.Each agency must periodically, at a

minimum biennially, evaluate itsrecords management programs relatingto adequacy of documentation, andmaintenance, use, and disposition ofrecords. These evaluations mustdetermine compliance with NARAregulations in Subchapter B and assess

the effectiveness of the agency'sprograms. Upon completion, agenciesmust provide copies of these internalevaluations to NARA's Office of RecordsAdministration. Assistance inconducting internal evaluations isavailable from this office.

4. Subpart C is revised to read asfollows:Subpart C-NARA Evaluation ProgramSec.1220.50 Authority.1220.52 Purpose and scope.1220.54 Evaluation process.1220.56 Evaluation report.1220.58 Agency action plans and progress

reports.1220.60 Followup notification and reviews.

§ 1220.50 Authority.44 U.S.C. Chapter 29 vests in the

Archivist of the United States theresponsibility for providing guidanceand assistance to Federal agencies withrespect to ensuring adequacy ofdocumentation and proper recordsdisposition. Sections 2904 and 2906specifically authorize the Archivist toconduct inspections or surveys ofrecords and records managementprograms and practices within andbetween Federal agencies and requireofficers and employees of agencies tocooperate fully in such inspections.Section 2904 also authorizes theArchivist to report to the appropriateoversight and appropriationscommittees of the Congress and theDirector of OMB on the results ofinspections, the responses by agenciesto NARA evaluation recommendations,and estimates of the costs to the Federalgovernment resulting from the failure toimplement such recommendations.

§ 1220.52 Purpose and scope.(a) NARA evaluations measure how

effectively Federal agencies make andpreserve complete and accurate recordsof their organization, functions, policies,decisions, procedures, and essentialtransactions; and maintain an active,continuing records managementprogram including proper recordsdisposition. Agencies shall be evaluatedfor compliance with requirements in 44U.S.C. chapters 31 and 33 and all theregulations issued thereunder in 36 CFRsubchapter B.

(b) NARA evaluations may includecomprehensive reviews of agencyrecords management programs, orselective reviews focused on adequacyof documentation, on recordsdisposition, on the management ofspecific types of record media or on themanagement of records in particularprogram areas. NARA evaluations maybe inter-agency or multi-agency. These

64916


evaluations may be conducted solelywithin headquarters offices, only at fieldlocations, or at a combination of fieldsites and headquarters.

(c) Evaluations will involve site visitsby NARA; submission by NARA to theagency of a written report containingfindings, analyses, andrecommendations; and submission toNARA by the agency of an action planfor implementing the recommendationsfollowed by regular progress reports.Interagency report control number0153-NARA-AR has been assigned tothe action plan and progress reports inaccordance with 41 CFR subpart 201-45.6.

§ 1220.54 NARA evaluation process.(a) NARA selects Federal agencies to

be evaluated on the basis of perceivedneed or specific request, or on the basisof a compliance monitoring cycle, andwill determine the scope of theevaluation. An agency may request anevaluation of its records managementprogram by contacting the AssistantArchivist for Records Administration;however, the final determination ofagencies to be evaluated will be madeby NARA. The heads of agencies will benotified in writing by the Archivist ofthe United States of the intent toconduct an evaluation at least 60calendar days prior to initiating theevaluation.

(b) Once NARA has notified theagency, the agency head must, by thedate specified in the Archivist's letter:

(1) Acknowledge in writing NARA'sintention to evaluate, and provide theArchivist with the name and telephonenumber of the senior official withoverall responsibility for recordsmanagement and of a headquartersofficial who will work with NARA tofacilitate the evaluation process;

(2) Provide written notification of theevaluation to all offices and contractorspotentially involved, and to all IRM andrecords staff; this notification willinclude instructions to cooperate withNARA by setting up interviews,providing requested information, andmaking records available for inspection;

(3) Provide NARA with a copy of thewritten notification in paragraph (b)(2)of this section and with a list of namesand telephone numbers of officialsresponsible for records management infield sites, if applicable, who will workwith NARA during the evaluation;

(4) For comprehensive evaluations,provide NARA with a complete set ofinternal records management directives,orders, bulletins, or similar authoritativeissuances; copies of the two most recentinternal records managementevaluations; and any special records-

related reports. Included will be allissuances relating to adequacy ofdocumentation and recordkeepingrequirements; personal papers;management and disposition of textual,electronic, audiovisual, cartographicand architectural, micrographic, andvital records; disaster preparedness andrecovery; and any other records-relateddocumentation requested by NARA. Asubset of this documentation will berequested for more limited evaluations;

(5) Provide NARA with a currentversion of the agency manual(s)covering records creation, miaintenance,storage, and disposition; a list of allagency schedules currently in effect;and a list of any agency functions andinformation systems not currentlycovered by schedules;

(6) Arrange for appropriatemanagement and program officials inheadquarters and, if applicable, at fieldsites to be briefed by NARA at thebeginning and at the end, of theevaluation process; and

(7) Take immediate corrective actionregarding any serious problems thatNARA may bring to the agency'sattention during the course of theevaluation process such as theunauthorized destruction of records orthe unauthorized donation or othertransfer of records to non-NARAfacilities.

§ 1220.56 Evaluation report.(a) NARA will submit a draft

evaluation report for comment to theagency within 120 calendar days of thelast evaluation site visit. After receipt ofagency comments, NARA will finalizethe report, incorporating any changesresulting from factual errors identifiedby the agency. The final report will betransmitted by the Archivist to the headof the agency.

(b) The head of the agency must:(1) Comment within 60 calendar days,

in writing, on the factual contents of thedraft report..If necessary, agencies mayrequest extensions. No response fromthe agency within the allotted time willindicate that the agency concurs in thefactual accuracy of the draft report.

(2) Review the final report and assignimplementation responsibility; and

(3) Distribute the final report to thesenior official with responsibility forrecords management, all informationresources management officials, allrecords managers and records liaisonstaff, and all affected program andmanagement officials.

§ 1220.58 Agency action plans andprogress reports.

(a) Action plans.(1) The action plan must be submitted

to NARA within 90 calendar days after

the date of transmittal of the finalreport. The plan is submitted by theagency head or the senior managementofficial responsible for records andinformation management. The actionplan must include:

i) The name of the senior official andthe office responsible for coordinatingimplementation agency-wide;

(ii) The specific action(s) the agencywill take to implement each evaluationreport recommendation;

(iii) The name of the official andoffice or program specificallyresponsible for initiating andcompleting each proposed action;

(iv) The estimated time needed tocomplete each action and the proposedmonth and year for starting andcompleting each action;

(v) Major milestones with dates fortracking the completion of long-term orcomplicated actions; and,

(vi) If requested by NARA, separateaction plans for each field site visited,incorporating the information requiredby paragraphs (a)(1) (i) through (v) ofthis section.

(2) NARA will. analyze the action plansubmitted by the agency for itsadequacy and effectiveness inimplementing the recommendationscontained in the evaluation report.NARA will provide comments to theagency on the plan within 60 calendardays.

(3) The agency must revise the actionplan until it is approved by NARA.

(b) Progress reports. (1) Once theaction plan has been approved byNARA, the head of the agency mustsubmit progress reports to NARA every6 months. The reports must include:

(i) A description of what has beenaccomplished on each action since thelast report;

(ii) The current status of the action;(iii) Any changes in the offices or

programs responsible for overall orspecific action implementation; and,

(iv) If appropriate, explanation of anydelays in implementation and revisedtarget dates and milestones forcompletion of the action.

(2) The agency continues to submitthese progress reports until all actionshave been completed, subject to NARAverification, or until NARA indicates inwriting that regular progress reports areno longer required.

(3) NARA will review and commenton agency progress reports, and workclosely with the agency to provideassistance in evaluationimplementation.

§ 1220.60 Follow-up notification andreviews.

(a) If NARA determines that theimplementation of evaluation

64917


recommendations is not progressing ina satisfactory manner, the Archivist maynotify Congress and appropriate Federaloversight agencies of the evaluationfindings and the agency response.

(b) NARA may initiate follow-upreviews at specific offices or field sites.Results of these follow-up reviews shallbe communicated to the head of theagency and, if NARA determines it to beappropriate, to Congress and Federaloversight agencies.

Dated: November 30, 1993.Trudy Huskamp Peterson,Acting Archivist of the United States.IFR Doc. 93-30177 Filed 12-9-93; 8:45 am]BILUNG ODE 751-1-W

POSTAL SERVICE

39 CFR Part 111

Special Bulk Third-Class EligibilityRestrictions

AGENCY: Postal Service.ACTION: Proposed rule.

SUMMARY: On October 28, 1993, thePresident signed into law H.R. 2403, the"Treasury, Postal Service and GeneralAppropriations Act" for 1994. Title VIIof H.R. 2403, the Revenue ForgoneReform Act, amends 39 U.S.C. 3626 byadding provisions to subsection (j) andnew subsection (m). These sectionsconcern the administration of specialbulk third-class postage rates for certainqualified nonprofit organizations. Theprovisions, which are not to take effectuntil after December 31, 1993, makecertain specific types of matterineligible to be mailed at the specialbulk third-class rates. This noticecontains regulations the Postal Serviceproposes for implementing thislegislation. The language in theregulations approximates that set forthin the law. Interested parties shouldsubmit their comments.DATES: Comments must be received onor before January 10, 1994.ADDRESSES: Written comments shouldbe mailed or delivered to Manager,Mailing Standards, Marketing Systems,room 8430, 475 L'Enfant Plaza WestSW., Washington, DC 20260-2419.Copies of all written comments will beavailable for inspection andphotocopying between 9 a.m. and 4p.m., Monday through Friday, at theabove address.FOR FURTHER INFORMATION CONTACT:Ernest Collins, (202) 268-5316.SUPPLEMENTARY INFORMATION: The newlegislation establishes additionalcontent-based restrictions on the matter

eligible for special bulk third-class rates.In order for material that advertises,promotes, offers, or for a fee orconsideration, recommends, describes,or announces the availability of anyproduct or service to qualify for theserates, the sale of the product or theproviding of the service must besubstantially related to the exercise orperformance by the organization of oneor more of the purposes constituting thebasis for the organization'sauthorization to mail at such rates.These determinations are to be made inaccordance with standards establishedunder the Internal Revenue Code. Thelegislation also establishes restrictionsfor mailing products at the special rates.Low cost products as defined under theInternal Revenue Code, items donatedor contributed to the qualifiedorganization, and periodicalpublications of qualified organizationsare the only products mailable at thespecial bulk third-class rates. The PostalService views the new provisions assupplementary to rather than a changeto or replacement for existingrestrictions on special rate mailings.That is, mailings ineligible for thespecial rates under existing rules remainineligible for these rates, regardlesswhether or not they violate the newrestrictions. Further, mailings whichviolate the new restrictions would notbe eligible for the special rates, whetheror not they would be eligible underexisting rules. In addition, the proposedrules would deny the use of special bulkthird-class rates for mailpieces,including catalogs and periodicals, thatcontain advertisements for products orservices that are not substantiallyrelated to the purposes constituting thebasis for the organization'sauthorization to mail at the special bulkthird-class rates, regardless of theinclusion of other advertisements thatqualify for mailing at those rates. As aseparate matter, the Postal Service isplanning to require a certificationstatement where an official of thequalified organization would submit asigned statement at the time of mailingcertifying that the mailing qualifies forthe special bulk third-class rates.

Although exempt from the notice andcomment provisions of theAdministrative Procedures Act (5 U.S.C.553 (b) and (c)) regarding proposedrulemaking by 39 U.S.C. 410(a), thePostal Service invites public commentson the following proposed amendmentsof part E370 of the Domestic MailManual, which is incorporated byreference in the Code of FederalRegulations. See 39 CFR part 111.1.

List of Subjects in 39 CFR Part 111Postal Service.

PART Ill."AMENDED)

1. The authority citation for 39 CFRpart 111 is revised to read as follows:

Authority: 5 U.S.C. 552(a); 39 U.S.C. 101,401,403,404, 3001-3011, 3201-3219, 3403-3406, 3621, 3626, 5001.

2. In the Domestic Mail Manual,section E371 is amended by adding5.4(d), 5.9, and 5.10. The proposed textis as follows:

Eligibility Module* *r *t l

E370 Special (Nonprofit) Bulk Rates

E371 Basic Standards

5.4 Prohibitions* *t t *t *

(Add new d. as follows:)d. Any product or service (other than

those described in 5.4a, b, and c) if thesale of the product or the provision ofsuch service is not substantially related(aside from the need, on the part of theorganization promoting such product orservice, for income or funds or the useit makes of the profits derived) to theexercise or performance by theorganization of one or more of thepurposes constituting the basis for theorganization's authorization to mail atsuch rates. The sale of a product or theprovision of a service is not consideredto be "substantially related" unless thesale of the product or the performanceof the service contributes importantly to,the accomplishment of the purposes ofthe organization in accordance withstandards established by the InternalRevenue Service and the courts withrespect to 26 U.S.C. 513 (a) and (c),Internal Revenue Code. This restrictiondoes not apply if the product involvedis a periodical publication meeting theeligibility criteria in E211 including thecriteria for one of the qualificationcategories listed in E211.1.1 andpublished by one of the types ofqualified nonprofit organizations listedin E371.2.0, or a subscription to receivesuch a periodical publication.

(Add new 5.9 as follows:)

5.9 Qualifying and NonqualifyingProducts and Services

a. Material that advertises, promotes,offers, or, for a fee or consideration,recommends, describes, or announcesthe availability of products or servicesunder the conditions described belowgenerally will not be ineligible under5.4d for mailing at the special bulk

64918


third-class rates, although that decisionmust be made on a case-by-case basisand the circumstances in an individualcase may require a different result.These products and services include,but are not limited to:

(1) Courses given by a university thatis a qualified nonprofit educationalorganization.

(2) Religious tracts or articles sold bya qualified nonprofit religiousorganization.

(3) Educational films shown by aqualified museum in the museum'sauditorium.

(4) Performances by students in aqualified school for the performing artswhere student participation inperformances is an essential part of theirtraining.

b. Material which advertises,promotes, offers, or, for a fee orconsideration, recommends, describes,or announces the availability ofproducts or services under theconditions described below generallywill be ineligible under 5.4d for mailingat the special bulk third-class rates.These products and services include,but are not limited to:

(1) Activities which generate incomeon which the qualified organizationcould be required to pay unrelatedbusiness income tax.

(2) Mugs and T-shirts sold by auniversity's bookstore.

(3) One or more products or servicesadvertised in the qualifiedorganization's periodical publicationwhich are not substantially related tothe qualified organization's purpose,notwithstanding the presence ofadvertisements for items which are sorelated. For example, a religiousorganization's periodical publicationcontaining advertisements for religioustracts could not qualify if it alsocontained advertisements for T-shirts.

(4) One or more products or serviceswhich are not substantially related tothe qualified organization's purposeincluded in a catalog that also offersitems which are so related. For example,a university's catalog of textbooksincluding prices for courses offered bythe university would not qualify if italso offered mugs and T-shirts that canbe purchased at the university'sbookstore.

(5) General entertainment filmsshown by a qualified museum in themuseum's auditorium.

(Add new section 5.10 as follows:)

5.10 Products Mailable at Special BulkThird-Class Rates

The following products are mailableat special bulk third-class rates:

a. Low cost items within the meaningof 26 U.S.C. section 513(h)(2), InternalRevenue Code. Under this standard, lowcost items are currently those having avalue of not more than $6.20. Cost isbased on the item's actual value,represented value, or retail value,whichever is highest.

b. Items donated or contributed to thequalified organization.

c. Periodical publications of aqualified nonprofit organization (seeE371.5.4d).

An appropriate amendment to 39 CFR111.3 to reflect these changes will bepublished if the proposal is adopted.Stanley F. Mires,Chief Counsel, Legislative.[FR Doc. 93-30336 Filed 12-6-93; 12:22 pmlBILUNG COOE 7710--12-


Bureau of Land Management

43 CFR Group 3400(WO-600-4130-02-24 1AIRIN 1004-AC16

Logical Mining Units (LMU's) inGeneral; LMU Application Procedures;LMU Approval Criteria; LMU Diligence;and Administration of LMU Operations

AGENCY: Bureau of Land Management,Interior.ACTION: Advance notice of proposedrulemaking.

SUMMARY: The Department of theInterior gives notice of its intention toamend the regulations at 43 CFR Group3400 relating to logical mining units(LMU's) for coal mining operations toimprove its procedures for review ofLMU applications and to improve itsadministration of LMU operations. Thepurpose of this proposed amendmentwould be to place greater emphasis onthe stewardship of the Federal coalresources and to ensure that Federalcoal resources are developed in a legal,efficient, economical, and orderlymanner with due regard to theconservation of coal reserves and otherresources. This notice solicits publiccomments to help guide preparation ofa proposed rule.DATES: Comments on this advancenotice of proposed rulemaking must besubmitted in writing by February 8,1994. Comments received after this datemay not be considered in the issuanceof the proposed rule.ADDRESSES: Comments should be sentto: Director (140). Bureau of LandManagement, room 5555, Main Interior

Building, 1849 C Street, NW.,Washington, DC 20240. Comments willbe available for public review at theabove address during regular businesshours (7:45 a.m. to 4:15 p.m.), Mondaythrough Friday.FOR FURTHER INFORMATION CONTACT:Paul Politzer, Chief, Division of SolidMinerals, Bureau of Land Management,(202) 452-0350.SUPPLEMENTARY INFORMATION: Theamendments to the regulations beingconsidered stem in part from an effortto improve the administration andmanagement of LMU's consistent withthe Department of the Interior'sresponsibility to ensure that anydevelopment of the Federal mineralestate is responsible.

This advance notice of proposedrulemaking presents only a generaldescription of the actions beingconsidered, and includes no regulatorytext. Regulations governing issuesrelated to the processing of LMUapplications and the administration ofLMU's appear in many specific sectionsof 43 CFR Group 3400. Public commentsregarding BLM's administration of allfacets of LMU's in the Federal CoalProgram are invited and will beconsidered in the development of aproposed rule.is notice is directed toward placing

greater emphasis on the stewardship ofthe Federal coal resources and to ensurethat Federal coal resources aredeveloped in an efficient, economical,and orderly manner with due regard tothe conservation of coal reserves andother resources within the concept ofecosystem management. Specifically,BLM will be examining regulatoryprovisions such as those that allow forestablishment of an LMU as a basis forsubstitution of LMU diligentdevelopment requirements for statutorylease-specific diligent developmentrequirements.

In publishing this advance notice ofproposed rulemaking, the BLM requestsinformation and public commentsrelated to LMU's that will assist theBLM in addressing the followingquestions:

1. Is any change in the currentregulations related to LMU diligentdevelopment required or necessary?

2. Is it appropriate for the approval ofan LMU to allow LMU diligentdevelopment requirements to supersedelease-specific diligence?

3. Is it appropriate to tie LMU diligentdevelopment requirements to the date ofthe most recent Federal lease includedin the LMU?

4. What criteria should be used toestablish LMU diligent developmentrequirement?

64919


5. How should LMU diligentdevelopment requirements be related tothe lease-specific diligent developmentrequirements of those leases included intheLMU?

6. Should the regulations continue toallow an LMU to be effective as early asthe date that a complete LMUapplication was submitted?

7. Should the regulations require thatat least one Federal lease be eitherproducing or included in an approvedSurface Mining Control andReclamation Act permit in order to beincluded in an LMU application?

8. What would be a viable, workingdefinition of the term "producing" or"production" under the Federal CoalLeasing Amendments Act and theMineral Leasing Act as the term relatesto LMU's? Should separate definitionsof "producing" and "production" bedeveloped specifically for LMU's? If so,what should the definition be?

The public is invited to raise anyadditional issues of concern relating todiligent development requirements forLMU's and submit suggested solutions.

The principal author of this advancenotice of proposed rulemaking is HaroldMoritz of the Division of Solid Minerals,assisted by the staff of the Division ofLegislation and RegulatoryManagement, Bureau of LandManagement.

Dated: December 6, 1993.Bob Armstrong,Assistant Secretary of the Interior.IFR Doc. 93-30257 Filed 12-9-93; 8:45 amIBILLING CODE 431041-"

DEPARTMENT OF HEALTH ANDHUMAN SERVICES

Administration for Children andFamilies

45 CFR Part 1370

RIN 0970-AB21

Family Violence Prevention andServices Programs

AGENCY: Administration for Childrenand Families (ACF), HHS.ACTION: Notice of proposed rulemaking.

SUMMARY: This proposed rule proposesrequirements for sections 303, 308, 311,and 314 of the Family ViolencePrevention and Services Act, asamended by the Child Abuse, DomesticViolence, Adoption, and FamilyServices Act of 1992 (Pub. L. 102-295),and is intended to provide States,Indian tribes and other grantees withinformation on grants available underthese sections of the statute,

DATES: Interested persons and agenciesare invited to submit written commentsconcerning these proposed regulationsno later than February 8, 1994.ADDRESSES: Comments should besubmitted in writing to the AssistantSecretary for Children and Families,Attention: William D. Riley, OCS/DSA,Fifth Floor, 370 L'Enfant PromenadeSW., Washington, DC 20447, or bedelivered to the Administration forChildren and Families, Office ofCommunity Services, Fifth Floor, 370L'Enfant Promenade SW., Washington,DC, between 8 a.m. and 4:30 p.m. onregular business days. Commentsreceived may be inspected during thesame hours by making arrangementswith the contact person shown below.FOR FURTHER INFORMATION CONTACT:William D. Riley, Administration forChildren and Families, Office ofCommunity Services, Fifth Floor, 370L'Enfant Promenade SW., Washington,DC 20447, telephone (202) 401-5529.

SUPPLEMENTARY INFORMATION:I. Program Description

The Family Violence Prevention andServices Act (the Act) authorizesformula and discretionary grantprograms which fund a range ofactivities designed to both preventfamily violence and provide services tovictims of family violence. Enacted astitle III of the Child Abuse Amendmentsof 1984, the Act was amended andreauthorized most recently by PublicLaw 102-295, the Child Abuse,Domestic Violence, Adoption, andFamily Services Act of 1992.

Under section 303 of the Act, fundsare awarded as formula grants to Statesand Indian tribes and tribalorganizations to assist in supportingactivities to prevent incidents of familyviolence and to provide immediateshelter and related assistance for victimsof family violence and their dependentsThese grants have supplemented manyalready established community-basedfamily violence prevention and serviceactivities. They also have allowed Statesand tribes to expand current serviceprograms and establish additional newcenters in rural and underserved areas,on Native American reservations, and inAlaskan Native Villages and RegionalCorporation Areas. In most areas, thereis private sector as well as State andlocal funding for these emergencyshelters.

Under section 311 of the Act, addedby the 1992 amendments, formulagrants are available to private non-profitState domestic violence coalitions toconduct activities to promote domesticviolence intervention and prevention

and to increase public awareness ofdomestic violence issues. Grant fundsare expected to support training andtechnical assistance activities as well aspublic education services.

Discretionary grants have funded anarray of activities to prevent domesticviolence and to better meet the needs ofvictims of domestic violence. Prior tothe passage of Public Law 102-295, theDepartment used discretionary funds tosupport the operation of theClearinghouse on Family ViolenceInformation, research activities with theBureau of Justice Statistics, regionallybased training and technical assistancefor State and local law enforcementpersonnel through the Department ofJustice, and technical assistance to Stateand local agencies and nonprofitorganizations administering familyviolence prevention and servicesprograms.

The 1992 amendments added a newsection 308 to the Act which requiresthe Secretary to establish and maintaina national resource center for familyviolence prevention and services and upto six special issue resource centers. Thenational resource center and the specialissue resource centers are expected tooffer resource, policy, and trainingassistance to Federal, State, and localgovernment agencies, to domesticviolence service providers, and to otherprofessionals and interested parties onissues pertaining to domestic violence. -

The national resource center isexpected to maintain a central resourcelibrary to collect and disseminateinformation relating to the incidenceand prevention of family violence andthe provision of immediate shelter andrelated assistance. The special interestresource centers are expected to providea specialization, on a nationwide basis,in at least one area of domestic violenceservice, prevention, or law.

Discretionary grants also are awardedunder section 314 of the Act to publicand private non-profit agencies, tribes,and tribal organizations to assist in thedevelopment of public information andcommunity awareness campaignactivities that will serve as informationmodels for the prevention of familyviolence.

II. New Statutory RequirementsPublic Law 102-295 amended the

Family Violence Prevention andServices Act and expanded its formulaand discretionary grant programs. Theamendments were designed to increasepublic awareness about domesticviolence, enhance professional training,improve direct services offered to familyViolence victims and their children,involve additional agencies in family

64920


violence prevention and services, and toimprove the general administration ofthe Act.

A summary of the major amendmentsmade by Public Law 102-295 follows:

* The Department must makeavailable not less than 10 percent of theappropriations for grants under section303 of the Act to Indian tribes, tribalorganizations and non-profit privateorganizations approved by an Indiantribe. (sec. 303)

* The match rate provided by localentities funded by the State is requiredto be 20, 35, and 50 percent for the .1st,2nd, and 3rd years, respectively. This Isa reduction from previous match raterequirements. (sec. 303)

.* The Secretary must report toCongress every two years on theeffectiveness of the programsadministered under the Family ViolencePrevention and Services Act. (sec. 306)

* The Secretary is required toestablish a national resource center andup to six technical assistance specialinterest resource centers to provideresource information, training andtechnical assistance. (sec. 308)

* The Secretary is required to awardgrants to fund State domestic violencecoalitions to further the purposes ofdomestic violence intervention andprevention through their work withjudicial law enforcement agencies,family law judges, child protectiveservices agencies, and children'sadvocates; conduct public educationcampaigns regarding domestic violence;and participate in planning andmonitoring of the distribution of grantsand grant funds to their State undersection 303(a). (sec. 311)

* The Secretary may make grants topublic or private non-profit entities forpublic information campaigns regardingdomestic violence. (sec. 314)

* The Secretary is required to publishregulations to implement sections 303,308, 311, and 314 of the Act. (sec.311(h) and sec. 312(a))

Il. Discussion of Part 1370-FamilyViolence Prevention and ServicesPrograms

Purpose (Sec. 1370.1)Sections 311(h) and 312(a) of the

Family Violence Prevention andServices Act, as amended, require theSecretary to publish regulationsimplementing sections 303, 308, 311,and 314 of the Act. These proposedregulations would address thisrequirement.

State and Indian Tribal Grants (Sec.1370.2)

This section proposes requirementsfor formula grants to States and Indian

tribes and tribal organizations undersection 303 of the Act.

Information and Technical AssistanceCenter Grants (Sec. 1370.3)

This section proposes requirements tosupport a national resource center andup to six special issue resource centersunder section 308 of the Act.

State Domestic Violence CoalitionGrants (Sec. 1370.4)

This section purposes requirementsfor formula grants to State domesticviolence coalitions under section 311 ofthe Act.

Public Information Campaign Grants(Sec. 1370.5)

This section proposes requirements tofund- discretionary grants for publicinformation campaigns under section314 of the Act.

IV. Impact Analysis

Executive Order 12866Executive Order 12866 requires that

regulations be reviewed to ensure thatthey are consistent with the prioritiesand principles set forth in the ExecutiveOrder. The Department has determinedthat this rule is consistent with thesepriorities and principles. An assessmentof the costs and benefits of availableregulatory alternatives (including notregulating) demonstrated that theapproach taken in tbe regulation is themost cost-effective and leastburdensome while still achieving theregulatory objectives.

This proposed rule simply proposesrequirements for four ongoing programsauthorized through the Family ViolencePrevention and Services Act.

Regulatory Flexibility ActThe Regulatory Flexibility Act (Pub.

L. 96-354) requires the FederalGovernment to anticipate and reducethe impact of regulations and paperworkrequirements on small entities. Theprimary impact of these rules is on Stategovernments, non-profit organizationsand individuals. We certify that theserules will not have a significant impacton a substantial number of small entitiesbecause they simply establishprocedures for grant applications andinclude no standards or requirementswhich would burden small entities.Thus, a regulatory flqpbility analysis isnot required.

Paperwork Reduction ActSections 1370.2 and 1370.4 of the

proposed rule contain informationcollection requirements regardingactivities supported by State and Indiantribal grants awarded under section 303

of the Act and activities supported byState domestic violence coalition grantsunder section 311 of the Act. The publicreporting burden related to theserequirements is estimated to be about 16hours each for a grantee awarded fundsunder section 303 and 16 hours each fora grantee awarded funds under section311. The collection of informationrequirements contained in these ruleshave beeq submitted to OMB for reviewunder section 3504(h) of the PaperworkReduction Act. Other organizations andindividuals desiring to submitcomments on this informationcollection requirement should directthem to (1) William D. Riley,Administration for Children andFamilies, Office of Community Services,Fifth Floor, 370 L'Enfant PromenadeSW., Washington, DC 20447, and (2) theOffice of Information and RegulatoryAffairs, OMB, New Executive OfficeBuilding, room 3206, Washington, DC20503. Attention: Desk Office forAdministration for Children andFamilies, Department of Health andHuman Services. After OMB approval isobtained we will publish the 0MBcontrol number in the Federal Register.


Grant programs-Social programs,Domestic violence, Family violence,Spouse abuse, Elder abuse and neglect.(Catalog of Federal Domestic AssistancePrograms: 93.671, Family ViolencePrevention and Services Program)

Dated: October 13, 1993.May Jo Bane,Assistant Secretary for Children and Families.

Approved: December 3, 1993.Donna E. Shalala,Secretary, Department of Health and HumanServices.

For the reasons set forth in thepreamble, title 45, chapter H, of theCode of Federal Regulations is proposedto be amended by adding a new part1370 to read as follows:

PART 1370-FAMILY VIOLENCEPREVENTION AND SERVICESPROGRAMS

Sec.1370.1 Purpose.1370.2 State and Indian tribal grants.1370.3 Information and technical assistance

center grants.1370.4 State domestic violence coalition

grants.1370.5 Public information campaign grants.

Authority: Sections 311(h) and 312(a) ofthe Family Violence and Services PreventionAct, as amended (42 U.S.C. 10401 et seq.)

64921

64922 Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Proposed Rules

§ 1370.1 Purpose.This part addresses section 303, 308,

311, and 314 of the Family ViolencePrevention and Services Act (the Act),as amended. The Act authorizes theSecretary to implement programs for thepurposes of increasing public awarenessabout and preventing family violenceproviding immediate shelter and relatedassistance for victims of family violenceand their dependents; and providing fortechnical assistance and trainingrelating to family violence programs toStates, tribes, local public agencies(including law enforcement agencies,courts, legal, social service, and healthcare professionals), non-profit privateorganizations and other persons seekingsuch assistance. All programsauthorized under the Act are fundedsubject to the availability of funds.

§ 1370.2 State and Indian Tribal Grants.(a) Each grantee awarded funds under

section 303 of the Act must meet thestatutory requirements of the Act and allapplicable regulations. Anannouncement which describes theapplication process, includinginformation on other applicableregulations, is published in the FederalRegiter.0e) All grantees under this section

must meet the requirements 45 CFR part92 and any applicable requirements of45 CFR part 74 regarding administrationof grants, including reportingrequirements and the periods forobligation and liquidation of funds.

(c(1) Each grantee shall submit anannual program activity report which isdue 90 days after the end of theobligation period. The report shallcontain:

(i) A description of the majoractivities supported by Family ViolencePrevention and Services Act funds andthe specific priorities addressed by theState, tribe or tribal organizations;

(ii) A description of the specificservices and/or facilities funded,contracted with, or otherwise includedin the implementation of the program(e.g., shelter, safe houses, relatedassistance);

(iii) A description of thecharacteristics and demographics of thepersons served by service or activity(i.e., by shelter nights, transportation,counseling, etc.) and an estimate of thenumber of persons served by eachservice or activity; and

(iv) A description of the preventionactivities supported during the programyear (i.e., information campaigns,community education, and publicawareness efforts).

(2) Each grantee must also submitannual financial status reports, Standard

Form 269 (SF-269). An interimfinancial status report is due 90 daysafter the end of the obligation period. Afinal financial status report is due 90days after the end of the liquidationperiod.

(d) States and Indian tribes mustprovide documentation of theprocedures that have been developedand implemented to insure theconfidentiality of records pertaining toany individual provided family violencetreatment or services (sec. 303(a)(2)(E) ofthe Act); and States must providedocumentation that the State has a lawor procedure that has been implementedfor the eviction of an abusing spousefrom a shared household (sec.303(a)(2)(F) of the Act).

(e) Approval of a tribal organization ofa non-profit organization to operate afamily violence shelter on a reservationor for projects designed to preventfamily violence shall be documented bya current tribal resolution stating thatthe organization or agency has theauthority to submit an application onbehalf of the Indian individuals in thetribe(s).

§ 1370.3 Information and technicalassistance center grants.

(a) Each grantee awarded funds undersection 308 of the Act must meet thestatutory requirements of the Act and allapplicable regulations. Anannouncement which describes theapplication process, includinginformation on other applicableregulations, is published in the FederalRegister.

(b) All grantees under this sectionmust meet the requirements of 45 CFRpart 74 regarding administration ofgrants, including reporting requirementsand the periods for obligation andliquidation of funds.

(c) Each grantee must submit annualfinancial status reports, Standard Form269 (SF-269). An interim financialstatus report is due 90 days after the endof the obligation period. A finalfinancial status report is due 90 daysafter the end of the liquidation period.

§ 1370.4 State domestic violence coalitiongrants.

(a) Each grantee awarded funds undersection 311 of the Act must meet thestatutory requirements of the Act and allapplicable regulations. Anannouncement whtch describes theapplication process, includinginformation on other applicableregulations, is published in the FederalRegister.

(b) All grantees under this sectionmust meet the requirements of 45 CFRpart 74 regarding administration of

grants, including reporting requirementsand the periods for obligation andliquidation of funds.

(c)(1) Each grantee shall submit anannual program activity report which isdue 90 days after the end of theobligation period. The report shalldescribe the coordination, training andtechnical assistance activities as well aspublic education services supported bygrant funds. The report must provide anassessment of the effectiveness of theactivities supported by the grant.

(2) Each grantee must also submitannual financial status reports, StandardForm 269 (SF-269). An interimfinancial status report is due 90 daysafter the end of the obligation period. Afinal financial status report is due 90days after the end of the liquidationperiod.

§ 1370.5 Public Information campaigngrants.

(a) Each grantee awarded funds undersection 314 of the Act must meet thestatutory requirements of the Act and allapplicable regulations. Anannouncement which describes theapplication process, includinginformation on other applicableregulations, is published in the FederalRegister.

(b) All private entities which aregrantees under this section must meetthe requirements of 45 CFR part 74regarding administration of grants,including reporting requirements andthe periods for obligation andliquidation of funds. All other granteesunder this section must meet therequirements of 45 CFR part 92 and anyapplicable requirements of 45 CFR part74 regarding the administration ofgrants, including reporting requirementsand the periods for obligation andliquidation of funds.

(c) Each grantee must also submitannual financial status reports, StandardForm 269 (SF-269). An interimfinancial status.report is due 90 daysafter the end of the obligation period. Afinal financial status report is due 90days after the end of the liquidationperiod.[FR Dec. 93-30149 Filed 12-9-93; 8:45 am)BILUNG CODE 4184-014A




49 CFR Part 396[FHWA Docket No. MC-90-71RIN 2125-AC47

.Inspection, Repair and Maintenance;Rockwell Disc Brake Inspection;Reconsideration of Petition

AGENCY: Federal HighwayAdministration (FHWA), DOT.ACTION: Reconsideration of petition;reopening of docket; request forcomments.

SUMMARY: The FHWA is reconsidering apetition for rulemaking received fromRockwell International Corporation(Rockwell). Rockwell petitioned theFHWA to amend appendix G to theFederal Motor Carrier SafetyRegulations, Minimum periodicinspection standards, to allow brakechambers activating the Rockwell discbrake an additional one-fourth of aninch pushrod stroke over that allowedfor similar brake chambers activatingdrum brakes. On July 2, 1992 (57 FR29457), the FHWA published a noticedenying Rockwell's petition. The FHWAis reopening this docket and requestingcomments on Rockwell's petition.DATES: Comments must be received onor before February 8, 1994.ADDRESSES: Submit written, signedcomments to FHWA Docket No. MC-90-7, room 4232, HCC-10, Office of theChief Counsel, Federal HighwayAdministration, 400 Seventh Street,SW., Washington, DC 20590. Allcomments received will be available forexamination at the above address from8:30 a.m. to 3:30 p.m., e.t., Mondaythrough Friday, except legal Federalholidays. Those desiring notification ofreceipt of comments must include a self-addressed, stamped postcard.FOR FURTHER INFORMATION CONTACT: Mr.Larry W. Minor, Office of Motor CarrierStandards, (202) 366-2981, or Mr. PaulBrennan, Office of the Chief Counsel,(202) 366-1350, Federal HighwayAdministration, Department ofTransportation, 400 Seventh Street,SW., Washington, DC 20590. Officehours are from 7:45 a.m. to 4:15 p.m.,e.t., Monday through Friday, exceptlegal Federal holidays.


BackgroundOn December 7, 1988 (53 FR 49402),

the FHWA published the final rule onperiodic inspection of commercialmotor vehicles. The final rule codified

detailed inspection criteria underappendix G to subchapter B of chapterIII, title 49, Code of Federal Regulations.The criteria include readjustment limitsfor airbrake systems.

Rockwell submitted a petition forreconsideration of the final rule onJanuary 4, 1989. Rockwell stated that"the necessary stroke requirements ofthe air disc brake have not beenaddressed in the subject rule. "Indiscussing its concerns Rockwellexplained:

Unlike drum brakes, where the lining-to-drum clearances increase as the brakecomponents heat during braking, thedisc brake operates exactly the reverse.As the brakes heat, the rotor disc-to-lining clearances decrease, resulting inbrake fade resistance and continuedexcellent braking ability. Because of thislining-to-rotor disc decrease inclearance during braking, the brakemust be initially set up to operate witha greater lining-to-rotor disc clearancethan a drum brake. If this extraclearance is not provided, there is apossibility [of brake drag after heavybraking] with resultant brakeoverheating and its potential seriousoutcome. The Rockwell automatic slackadjusters for the disc brake are,therefore, designed to allow a slightlylonger stroke range than the Rockwellautomatic slack adjusters that are usedwith the drum brakes. These disc brakeslack adjusters operate with anapproximate 1/4" longer stroke rangethan their drum brake counterparts.This slightly longer stroke range assuresthat brake drag does not occur.

Rockwell * * * has been attemptingto rectify the air disc brake requirementfor additional, allowable automaticslack adjuster stroke for the neededlining-to-rotor disc clearance with boththe FHWA and the Commercial VehicleSafety Alliance (CVSA) since 1986.Prior to 1986 both the CVSA inspectioncriteria and the DOT Motor CarrierSafety Training Text * * allowedextra brake chamber stroke for air discbrakes before this allowance wasomitted from both the CVSA VehicleOut-Of-Service Criteria and the DOTMotor Carrier Safety Training Text. Asa result of this omission, Rockwell onOctober 15, 1986 met with the FHWA* * * to request reinstatement of thedisc brake stroke criteria as outlined in* * * (our) June 25, 1987 attachment(letter to the FHWA). Rockwell has alsomet formally on three occasions withthe CVSA Vehicle Committee to presentdata and request the reinstatement ofthe disc brake criteria. * * * As part ofthis process, Rockwell has submitted tothe CVSA extensive vehicle test resultsincluding parking and stopping data for

both disc and cam brakes. This datagathered two months ago at theTransportation Research Center of Ohio((TRC)), utilizing TRC drivers and withDOT personnel present at key tests,supported Rockwell's engineeringanalysis that vehicles equipped withdisc brakes utilizing the needed extrabrake chamber stroke meet or exceed theNational Highway Traffic SafetyAdministration's MVSS #121 (FederalMotor Vehicle Safety Standard No. 121)requirements as well as equaling or out-performing similar vehicles equippedwith cam brakes in both grade holdingand high speed stop (stopping) tests.

Rockwell proposed that the followingreadjustment limits be used for air discbrakes:

Maximumstroke at

Clamp type chamber which brakesshould be re-

adjusted

16 ........................................... . 220 ........................................... . 224 ........................................... . 224 (long stroke) ...................... . 21/430 ............................................ 21/4

On May 2, 1990, the FHWA publisheda notice requesting comment onRockwell's petition (55 FR 18355). Thenotice of petition included severalquestions for commenters to consider.

1. Should appendix G to subchapter Bbe amended to allow the Rockwellpetition?

2. If the Rockwell petition is grantedallowing the additional one-fourth inchpushrod stroke for disc brakes, do youforesee any problems in enforcement?

3. If the Rockwell petition is granted,do you foresee any problems inmaintaining the disc brake assembly,including the automatic slack adjuster,within the requested pushrod stroke?

4. Would there be any enforcementproblems created by allowing a differentstandard between those disc brakes withautomatic slack adjusters and those withmanual adjusters?

5. Would granting the relief requestedhave any effect on the braking efficiencyas it relates to safe stopping distance?

The FHWA received nine commentsto the notice of petition from: theAmerican Trucking Associations (ATA);Bendix Heavy Vehicle Systems Group ofAllied-Signal, Inc. (Bendix); theCommercial Vehicle Safety Alliance(CVSA); the State of Connecticut, .Department of Motor Vehicles; EatonCorporation; Ford Motor Company;Lucas Automotive; Maine State Police;and the Maryland State Police. All ofthe commenters, with the exception ofBendix, were opposed to granting the

64923


petition. Bendix neither endorsed norrejected the Rockwell petition, butcommented on "issues that deservefurther consideration."

The FHWA denied the Rockwellpetition in a notice published on July 2,1992 [57 FR 29457]. The FHWAconcluded that:

The brake adjustment criteria of appendixG should be based on the outputcharacteristics of the brake chamber, not onthe type of air brake or the type of brakeadjuster being used. The Rockwell disc brakedesign uses brake chambers similar if notidentical to the brake chambers used withdrum brakes. As air pressure is exerted onthe diaphragm, the pushrod is extended. Theslack adjuster transfers the linear motion ofthe pushrod into rotational movement of thepowershaft of the disc brake. Rotation of thepowershaft clamps the brake pads against thedisc. As the output force from the brakechamber decreases, the clamping forceagainst the discs decreases.

Brake adjustment (pushrod stroke) greatlyaffects the amount of torque that can begenerated by the brake. Braking effectivenessdecreases with increasing stroke. Thedecrease in braking force begins before thepushrod stroke reaches the current limits andaccelerates rapidly as the full stroke or"bottom out" point is reached. The currentbrake adjustment limits reflect the maximumpushrod stroke before the output force of thebrake chamber falls below acceptable levels.The levels used by the FHWA in appendixG are consistent with the recommendedlimits available from air brake manufacturers.

The FHWA does not believe that anamendment to appendix G is necessary toaccommodate the use of air disc brakes.Rockwell has indicated that designconsiderations for the air disc brake result inthe "occasional violation" of the currentpushrod stroke limits. The FHWA does notbelieve that safety standards should beamended because a manufacturer's designresults in occasional violations. Rockwell hasnot shown that disc brakes inherently requireadditional stroke.A complete review of the comments isalso included in the notice.Rockwell Request for Reconsideration

On August 18, 1992, Rockwell and theFHWA met to discuss the petition.Rockwell believed the July 2, 1992,decision may have been founded onincomplete or misstated information.The Federal Highway Administrator, inan August 21, 1992, letter, notifiedRockwell that the FHWA would reopenthe matter by issuing a subsequentnotice to "assure that all relevantinformation is compiled, fully analyzed,and considered." Therefore, this noticeof reconsideration of the Rockwellpetition includes a detailed discussionof the data submitted by Rockwell. Allinformation submitted by Rockwell isincluded in FHWA Docket No. MC-90-7.

Discussion of Rockwell's Disc BrakeData

1986 Presentation of Data

On October 15, 1986, Rockwell gavea presentation to the FUWA about itsdisc brake system. Several specificissues were covered in Rockwell'stechnical discussion as set forth below.

Output Force Reduction With 11"Increase in Pushrod Stroke

The output force for the disc brakesystem using a type 24 brake chamberis reduced by 2.6 to 11.9 percent whenthe pushrod stroke is increased to 2inches. "Calculations at the increasedstroke and maximum pressure indicatethat the vehicle 20 mph stoppingdistance increase is minimal, i.e. (0.91-2.2 feet and is still within the [FHWA]35 foot requirement for vehicleperformance (§ 393.52)."

Rockwell states:

lA]n increase in stopping distance willonly occur at maximum available chamberpressure. At any pressure lower than themaximum, the driver has only to increase theapplication pressure slightly to achieveminimum stopping distance for the situationat hand. Rockwell has conducted manypressure spectrum analyses of vehicles inservice which indicate that a maximumpressure stop is very rare indeed.

Dynamometer Tests of the OutputTorque

Dynamometer tests indicate"increasing torque output with'increasing pressure even beyond the 1/4inch to 2 inch stroke range for Type 24and Type 30 service chambers. * * * Inaddition, disc brakes do not have anincrease in chamber stroke from thestatic to the dynamic mode. In fact,often the dynamic stroke for a disc brakeis less than the static stroke * * *."

Deflection Characteristics andTemperature Expansion of Disc Brakes

Rockwell states that "the geometry,temperature expansion and deflectioncharacteristics of disc brakes suggestthat additional stroke allowances in theinitial or brake off state are required."The total brake pad swell and rotorexpansion is 0.054 inches at 1000 OF formaterials used in the 1986 tests. "If[0.05] inches of clearance is allowed inthe free state, * * * the currentrecommended chamber strokes will beexceeded at 85 psi if high temperaturedrag is to be prevented."

1988 Vehicle Performance Test Data

On October 25, 1988, Rockwellpresented results of vehicle performancetests to the CVSA Vehicle Committee.The tests were performed at theTransportation Research Center, East

Liberty, Ohio, on" October 11, 19, and20, 1988, and compared brakeperformance of vehicles equipped withdisc brakes and vehicles equipped withdrum brakes. Straight trucks (grossweight of 35,000 pounds) and tractor-semi-trailer combinations (gross weightof 80,000 pounds) were tested. A moredetailed description of the test vehiclesand their respective brake systems isprovided in written material and videotapes submitted by Rockwell; Thismaterial also includes video tapes of theperformance tests. Test conditions were:20-percent grade holding; drawbar pull(only for the combination vehicles withthe tractor parking brakes applied); 20mph stopping distance (only for thecombination vehicles); and 60 mphstopping distance.

Stopping Distance TestsThe 20 mph stopping distance tests of

the tractor-senj-trailers show that thedisc-braked vehicle (pushrod stroke at21/4 inches) had stopping distancesgreater than those for the drum-brakedvehicle (pushrod stroke at 2 inches) infour of the five test runs Rockwelldiscussed. The application pressuresused in the five test runs were 20, 40,60, 80 and 100 psi. The test run inwhich the brake application pressurewas 40 psi is the only case in which thedisc-braked vehicle had a shorterstopping distance.

The 60 mph stopping distance tests ofthe tractor-semi-trailers show that thedisc-braked vehicle (pushrod stroke at2 / inches) had stopping distancesgreater than those for the drum-brakedvehicle (pushrod stroke at 2 inches) atapplication pressures of 20 psi and 40

si. At 60, 80 and 100 psi the disc-raked vehicle had shorter stopping

distances than the drum-braked vehicle.At 60 and 80 psi, the disc-brake vehiclehad stopping distances of 400.1 and354.7 feet respectively. These distanceswere each approximately 13 feet shorterthan those recorded for the drum-brakedvehicle. At 100 psi the disc-brakedvehicle had a stopping distance of 303.4feet while the drum-braked vehicle hada stopping distance of 341.0 feet.

The 60 mph stopping distance testsfor the straight truck were driver-best-effort tests. The application pressureswere not reported. The tests comparedthe performance of the disc brakesystem with pushrod stroke of 21/4 inchand the drum brake system with thepushrod stroke of 2 inches. Three stops.with an average distance of 265.6 feet,were recorded for the disc-brakedvehicle. Six stops with an averagedistance of 301.7 feet were recorded forthe drum-braked vehicle. However,three of the six drum brake tests

64924


recorded stopping distances less than300 feet, and the average for the threeshortest stopping distances was 285.1feet.

20-Percent Grade Holding ResultsThe 20-percent grade-holding test

information provided by Rockwellincluded results from four initial braketemperatures for the tractor-semi-trailers: 500 0F, 600 0F, 650 OF, and 700OF. The disc-braked vehicle had parkingbrakes on each of the tandem axles onthe tractor and trailer. The drum-brakedvehicle had parking brakes on only oneof the tandem axles on the tractor, andone of the tandem axles on the trailer.

During the grade-holding tests for thedisc-braked tractor-semi-trailer (pushrodstroke of 21/4 inch) facing uphill, thevehicle "crept" when the initial braketemperature was 700 OF. At an initialbrake temperature of 650 OF the discbrakes held while the brakes cooled toambient temperature. The results for thetractor-semi-trailer facing downhillindicate the brakes held while thebrakes cooled from an initialtemperature of 600 OF to ambienttemperature.

The grade-holding tests for the drum-braked tractor-semi-trailer (pushrodstroke of 2 inches) facing uphillrecorded the greatest initial temperatureat which the brakes would hold as 500OF. The results for the tractor-semi-trailer facing downhill indicate that thebrakes held when the initialtemperature was 600 OF.

The grade-holding tests for the two-axle straight truck (pushrod stroke of21/4 inches for the disc-braked vehicle,2 inches for the drum-braked vehicle)included results from three initial braketemperatures: 100 OF, 600 OF, 700 OF.Rockwell indicated that the disc-brakedtruck was not able to hold the grade(facing uphill and facing downhill)when the initial brake temperature was700 °F. With an initial temperature of600 °F, the disc brakes held while thebrakes cooled to 200 OF.

The grade-holding tests for the drum-braked vehicle indicate that the parkingbrakes held when the initialtemperature was 100 °F but did not holdwhen the initial temperature was 600°F. Results for temperatures between100 °F and 600 °F were not provided.Drawbar Pull

The drawbar test was performed onthe tractor-semi-trailer vehicles tomeasure the parking brake retardationforce (using only the tractor parkingbrakes). As noted in the 20-percentgrade holding test, the disc-brakedvehicle had parking brakes on each ofthe tandem axles on the tractor. The

drum-braked vehicle had parking brakeson only one of the tandem axles on thetractor. The disc-braked vehicle had aretardation force of 12,500 pounds inboth the forward and reverse directions.The drum-braked vehicle had aretardation force of 10,750 pounds inthe forward direction and 11,000pounds in the rear direction.

1989 Dynamometer Test DataOn September 27, 1991, Rockwell

presented additional information to theFHWA. This data consisted of threedynamometer tests performed on July 5,July 7, and July 11, 1989. Rockwellindicated that the slack adjuster(s) usedin the dynamometer tests were notmanufactured by Rockwell.

The July 5, 1989, brake retardationdata showed a pushrod stroke of 2.03and 2.13 inches with rotor temperaturesof 618 OF and 625 °F and applicationpressures of 70 and 80 psi respectively.The brake recovery test data (twentysequences) indicates the minimumpushrod stroke was 2.06 inches(maximum application pressure of 77psi, minimum application pressure 52psi) while the maximum stroke was 2.20inches (maximum application pressureof 89 psi, minimum applicationpressure 51 psi). The 60 mph brakeperformance tests indicate pushrodstrokes of 2.11 inches and 2.26 inchesat application pressures of 90 and 100psi respectively. The 20 mph and 50mph brake performance tests producedpushrod strokes less than two inches.

The July 7, 1989, data was similar tothe July 5, 1989, data. However, onlyfour of the twenty recovery sequencesproduced pushrod strokes of 2 inches orgreater. The longest pushrod stroke was2.03 inches (maximum applicationpressure of 72 psi, minimumapplication pressure of 54 psi). All ofthe remaining recovery sequencesresulted in pushrod strokes between1.95 inches and 1.99 inches (ninerecovery sequences at 1.95 inches, oneat 1.96 inches, four at 1.97 inches andtwo at 1.99 inches).

The July 11, 1989, brake retardationdata indicate a pushrod stroke of 2.01inches with a rotor temperature of5390 F and an application pressure of 80psi. The twenty brake recoverysequences did not include any cases inwhich the pushrod stroke exceeded twoinches. Fifteen of the twenty sequencesresulted in a pushrod stroke of 1.84inches. Four of the sequences resultedin a pushrod stroke of 1.83 inches andone of the sequences resulted in apushrod stroke of 1.87 inches. The brakeperformance tests produced severalcases with a pushrod stroke of twoinches or greater. During the 20 mph

test the pushrod stroke was 2.02 incheswith an application pressure of 100 psi.The 50 mph stopping test resulted in apushrod stroke of 2.00 inches at 90 psi,and 2.09 inches at 100 psi. The 60 mphstopping test resulted in pushrodstrokes of 2.08 inches, 2.20 inches, and2.31 inches with application pressuresof 80, 90 and 100 psi, respectively.

1991 Pushrod Stroke Data ComparisonBetween the Disc Brake System With aRockwell ASA and a Competitor's ASA

On August 20, 1992, Rockwellsubmitted data comparing the pushrodstroke of the disc brake system usingRockwell automatic slack adjusters(ASAs) and a competitor's ASAs.Rockwell states:

The data was acquired during theinspection of twelve tractor units inSeptember 1991. Six of the units wereequipped with Rockwell automatic slackadjusters and six were equipped with acompetitor's automatic slack adjusters. Thefront axles were equipped with type 16 airchambers and the rear axles were equippedwith type 24 long stroke air chambers.Measurements were taken at a brakeapplication pressure of 90 psi with a rulegraduated in '/iA inch increments.

Rockwell's summary of the pushrodstroke measurements from 1991 isprovided below. Rockwell did notdescribe the vehicles used in the tests orthe brake temperatures at which thepushrod stroke measurements weretaken. Nevertheless, the rear axlecomparison data that Rockwell providedwith its August 20, 1992, letter suggestthat the vehicle was a three-axle truckor truck-tractor.

Rockwell Com-ASA petitor'sASA

Front axle comparison:Maximum stroke .... 1.75 2.19Minimum stroke ..... 1.38 1.63Average stroke ...... 1.53 1.80

Rear axles (tandem)comparison:

Maximum stroke .... 2.06 2.00Minimum stroke ..... 1.69 1.69Average stroke ...... 1.88 1.85

Rockwell believes the 1991 datasummarized above support its claimthat "replacement of the Rockwellautomatic slack adjuster with a differentadjuster would not be a viable solutionof the stroke limit issue." Rockwellstates "the need for a longer stroke isinherent in the air disc brake itself, andis not sensitive to the particular slackadjuster used on the system."

In response to the FHWA's request forinformation about the number of disc-braked vehicles cited for violation of the

64925

Federal Register / VoL 58, No. 236 / Friday, December 10, 1993 / Proposed Rules

brake readjustment limits, Rockwellstates:

While we do not have completeinformation to enable an answer to thatquestion, we thought it would be helpful toenclose copies of two letters from major fleetcustomers. These letters were written insupport of Rockwell's petition forreconsideration after the close of thecomment period. These letters reiterate ourcustomer's strong satisfaction with theperformance of the air disc brake system andexpress their concern that the regulatorystandards for maximum stroke will adverselyaffect the future of the air disc brakes,The two fleet customers Rockwell refersto are Perdue Farms, Incorporated andShell Oil Company. Both fleets sentletters to the FHWA in late 1991. Theletters are included in FHWA DocketMC-90-7.

Concerns of Motor Carriers UsingRockwell Disc Brakes

Rockwell indicated that motor carriersusing the Rockwell disc brake systemhave had problems with brakeadjustment violations and vehiclesbeing placed out of service. Rockwelldid not provide specific figures on thetotal number of vehicles currently inservice, and the percentage that areplaced out of service within a givenperiod of time. The FHWA did notreceive any comments from motorcarriers in response to the May 2, 1990,notice.

Waste Management, Inc. (WasteManagement), however, did expresssupport for the Rockwell petition. WasteManagement and Rockwell met with theFHWA in Washington, DC, onSeptember 27, 1991. Waste Managementhas more than 4,000 vehicles equippedwith air disc brakes. Waste Managementstates:

Our maintenance program calls for brakecomponent, operation and adjustmentinspection every 150 hours of operation orevery 45 days, whichever occurs first. Aswith any component, and particularlycomponents such as brakes associated withthe safe operation of the vehicle, any noteddiscrepancies are corrected before releasingthe vehicle for service. In our experience, theair disc brake does not require frequent brakeadjustment.With regard to problems noted duringroadside inspections, WasteManagement believes the FHWA shouldgrant Rockwell's petition "so that safetyconscious fleets already equipped andoperating with these superior brakeswill not continue to be subjected toneedless tickets and fines." WasteManagement did not provide anyspecific information on the frequencywith which their disc-braked vehiclesare cited for improper brake adjustment.

In November and December 1991, theFHWA received letters from four motorcarriers (The Arundel Corporation,Provost Bulk Transport, Inc., PerdueFarms Incrporated, and Shell OilCompany) in support of the Rockwellpetition. None of the letters includedtechnical data or informationquantifying problems with brakeadjustment.

Request for CommentsThe FHWA is requesting comments

on the Rockwell petition and the dataRockwell submitted in support of itspetition.

1. Roadside inspection data indicatethat airbrake system deficiencies are themost frequent reasons heavy trucks areplaced out of service. The most commonairbrake system deficiency is improperbrake adjustment. Are the brakeadjustment problems described byRockwell "inherent" to disc brakesystems, orare they comparable to thebrake adjustment problems with drumbrake systems?

2. Does the Rockwell comparisonbetween the performance of disc-brakedvehicles (with pushrod stroke at 21/4inches) and the performance of drum-braked vehicles (with pushrod stroke at2 inches) provide conclusiveinformation about the safety ofoperation of a disc-braked vehicle withpushrod strokes in excess of thereadjustment limits in appendix G? TheFHWA notes that such a comparison isone in which both vehicles would beplaced out of service. The FHWArequests comments on how the FHWAshould interpret data which indicatethat a disc-braked vehicle (with brakesat 21/4 inches pushrod stroke) performsbetter, under some circumstances, thana drum-braked vehicle that would beplaced out-of-service for improper brakeadjustment.

3. Are the methods/proceduresRockwell uses to compare disc brakeperformance with drum brakeperformance technically valid? Does thecomparison indicate that a disc-brakedvehicle with pushrod strokes in excessof the readjustment limits in appendixG has braking efficiency or performancecomparable to that of a drum-brakedvehicle with brakes adjusted to complywith the limits in appendix G?

4. The FHWA notes that the Rockwelldata shows several cases in whichinitial test temperatures were at 600 °Fand above. As explained by Rockwell,"disc brakes when hot run at reducedclearance while hot drum brakes run atincreased clearance and chamberstroke." If the Rockwell petition isgranted, disc-braked vehicles withpushrod strokes almost / inch greater

than the readjustment limits ofappendix G would pass roadsideinspections and the annual inspectionirrespective of the temperature of thebrake at the time of the inspection. If thepushrod stroke is near the 2V4-inch limit(e.g., 23 e inches) while the temperatureis almost 700 OE, would the pushrodstroke be in excess of 21/4 inches attemperatures 250 to 400 OF lower?Should the possibility of longer pushrodstrokes at low to moderate braketemperature (e.g., 200 to 450 OF) be aconsideration in the evaluation of thepetition?

5. Rockwell states that "an increase instopping distance will only occur atmaximum available chamber pressure"when the additional pushrod stroke isallowed. Rockwell also states that a"maximum pressure stop is very rareindeed." The FHWA believes Rockwellis correct in its assertion about thefrequency of maximum pressure stops.Such stops are generally associated withemergency situations. Would allowingthe additional 1/4-inch pushrod strokedecrease the effectiveness of the brakesduring their most critical application-a panic stop--or would the allegedsuperiority of the disc brakes result inshorter stopping distances anyway?

6. Rockwell indicated that "certaininitial design considerations" whichwere required for the air disc brakeresult in the "occasional violation" ofthe brake readjustment limits used inroadside inspections and in appendix Gto subchapter B. Rockwell limiteddiscussion to clearance between therotors and pads. Could designconsiderations which were notdiscussed (e.g., length of the slackadjuster, dimensions of the power shaft,stiffness of the brake chamber mountingbrackets and caliper) contribute topushrod stroke problems of the naturethat Rockwell described?

7. The brake readjustment limits ofappendix G are generally 80-percent ofpushrod stroke for the specific type ofbrake chamber. (Example: In the case ofthe Type 30, clamp chamber, the 2-inchreadjustment limit is 80 percent of the2 /-inch maximum distance thepushrod can travel before the chamber"bottoms out.") If the petition isgranted, the reserve stroke for a Type 30brake chamber used in a disc brakesystem would be reduced from 1/2 inchto 1/4 inch. Is a 4-inch reserve strokeadequate to ensure the safe operation ofvehicles equipped with disc brakes?

8. Does the information/data providedby Rockwell provide documentation ofthe existence of a problem that can onlybe resolved by amending appendix G tosubchapter B?

64926

Federal Register / VoL 58, No. 236 / Friday, December 10, 1993 / Proposed Rules

The FHWA requests that commentersaddress the specific questions above.The FHWA also encourages commentersto include a discussion of any otherissues that the commenters believe arerelevant to the evaluation of Rockwell'spetition.

List of Subjects in 49 CFR Part 396Highway safety, Motor carriers, and

Motor vehicle safety.Authority: 49 U.S.C. 3102; 49 U.S.C. app.

2505; 49 CFR 1.48.Issued on:.December 3, 1993.

Rodney L Slater,Federal Highway Administrator.[FR Doc. 93-30210 Filed 12-9-93; 8:45 am]VALII4 O0 4010-2-P


Fish and Wildlife Service

50 CFR Part 17RIN 1018-AC09

Endangered and Threatened Wildlifeand Plants; Thirty-day Extension onthe Proposed Rule To List the Hine'sEmerald Dragonfly (SomatochloraHineana) as Endangered

AGENCY: Fish and Wildlife Service,Interior.ACTION: Proposed rule; notice ofextension of comment period and publichearing request deadline.

SUMMARY: The U.S. Fish and WildlifeService (Service) extends for 30 days theperiod during which it will acceptcomments and requests for publichearings on the proposed rule (58 FR51604-51607, October 4, 1993) to listthe Hine's emerald dragonfly(Somatochiora hineana) as endangeredpursuant to the Endangered Species Actof 1973, as amended. The Servicebelieves a number of parties interestedin these proposed listings may not havereceived notice of the proposals insufficient time to submit comments orrequest public hearings during theoriginal comment periods. Theextension will provide sufficient timefor comment preparation andsubmission of requests for publichearings.DATES: This extension will result in thecomment period for the proposal endingon January 3, 1994. The public hearingrequest period will end on December 20,1993.ADDRESSES: The complete file for thisproposal is available for inspection, byappointment, during normal businesshours, at the U.S. Fish and Wildlife

Service, Division of EndangeredSpecies, Bishop Henry Whipple FederalBuilding, 1 Federal Drive, Fort Snelling,Minnesota 55111-4056.FOR FURTHER INFORMATION CONTACT:Terence J. Miller, Acting Chief, Divisionof Endangered Species. at the aboveaddress (telephone 612/725-3276).


Background

The Hine's emerald dragonfly hasbeen proposed for listing as anendangered species due to strongevidence that its range and numbershave declined dramatically, primarily asa result of the destruction of habitat, andthat the threats to its habitat arecontinuing. The Illinois habitat, whichincludes three counties, consists ofcomplex wetlands with small, shallow,spring-fed streams that drain into wetmeadows and cattail marshes. TheWisconsin habitat, encompassing onecounty, consists of small, calcareous,marshy streams and associated cattailmarshes on dolomite bedrock.

Since the publication of the October4, 1993, proposal to list this dragonflyas an endangered species, the Servicehas been attempting to contact ownersof property upon which the Hine'semerald dragonfly is believed to exist.The Service has also been contacting themajor national, regional, and statescientific societies; and county, state,and federal governmental agencieshaving activities in these areas to notifythem of the proposals and theirpotential effects. However, the Servicebelieves a significant number ofinterested and affected parties may nothave received notification in time forthem to review the proposal and submitcomments or requests for publichearings. The Service considers inputfrom all interested and affected partiesto be a vital component of the listingprocess. Therefore, the Service isproviding additional opportunity for allparties to prepare and submit commentson the proposal and to request publichearings.

Author

The author of this notice is CarlitaShumate, U.S. Fish and WildlifeService, Division of EndangeredSpecies, Bishop Henry Whipple FederalBuilding, 1 Federal Drive, Fort Snelling,Minnesota 55111-4056.

Authority: 16 U.S.C. 1361-1407; 16 U.S.C.1531-1543; 16 U.S.C. 4201-4245; Pub. L. 99-625, 100 Stat. 3500; unless otherwise noted.


Endangered and threatened species,Exports, Imports, Reporting and

recordkeeping requirements,Transportation.

Dated: December 6, 1993.Sam Marler,Regional Director.[FR Doc. 93-30193 Filed 12-9-93; 8:45 am]DILUNG CODE 431 0-6N-M

50 CFR Part 17

Endangered and Threatened Wildlifeand Plants; Finding on Petition andInitiation of Status Review onReclassification of Cotton-top Tamarin

AGENCY: Fish and Wildlife Service,Interior.ACTION: Notice of petition finding andstatus review.

SUMMARY: The U.S. Fish and WildlifeService (Service) announces the 90-dayfinding that a petition to reclassify theNorth American captive populations ofthe cotton-top tamarin has presentedsubstantial information indicating thatthe action may be warranted. A statusreview of these populations is initiated.DATES: The finding announced hereinwas made on November 10, 1993.Comments and information may besubmitted until March 10, 1994.ADDRESSES: Comments, information,and questions should be submitted tothe Chief, Office of Scientific Authority;Mail Stop: room 725, Arlington Square;U.S. Fish and Wildlife Service;Washington, DC 20240 (Fax number703-358-2276). Express and messenger-delivered mail should be addressed tothe Office of Scientific Authority; room750, 4401 North Fairfax Drive;Arlington, Virginia 22203. The petitionfinding, supporting data, and commentsare available for public inspection, byappointment, from 8 a.m. to 4 p.m.,Monday through Friday, at theArlington, Virginia address.FOR FURTHER INFORMATION CONTACT:Dr. Charles W. Dane, Chief, Office ofScientific Authority, at the aboveVirginia address (phone 703-385-1708).SUPPLEMENTARY INFORMATION: Section4(b)(3) of the Endangered Species Act of1973, as amended in 1982, requires thatwithin 90 days of receipt of a petitionto list, delist, or reclassify a species, orto revise a critical habitat designation, afinding be made on whether the petitionhas presented substantial informationindicating that the requested action maybe warranted, and that such finding bepublished promptlk in the FederalRegister. If the finding is positive,section 4(b)(3) also requirescommencement of a review of the statusof the involved species. The Service

64927


hereby announces a positive 90-dayfinding on a recently received petition.

The petition was submitted by Dr.Ronald D. Hunt, Director, New EnglandRegional Primate Research Center. Itwas dated April 28, 1992, and wasreceived by the Service on May 1, 1992.It requests that the North Americancaptive populations of the cotton-toptamarin (Saquinus oedipus), also knownas the cotton-top marmoset, bereclassified from endangered tothreatened. Such reclassification couldallow these populations to be coveredby special rules, CFR 17.40(c),facilitating their management incaptivity. The provision being sought bythe petitioner would be similar to thatnow covering the chimpanzee (Pantroglodytes). The petition included datasuggesting that the involved populationswere large, genetically diverse, and wellmanaged, and would soon substantiallyexceed wild populations in size..

The petitioner pointed out that thereare now about 1,800 cotton-top tamarinsin the international studbook for the

species. About half of that number arenow in captivity in North America, andabout half the latter are held at thepetitioner's facility. This colony hasbeen growing at a rate of 11-13 percentannually for the past five years, withover 60 percent of the animals now heldbeing captive born. The petitionerindicated that at current rates of growththe over-all captive cotton-toppopulation in North America willdouble in five years. He stated that sucha growth rate would be more thanenough to sustain the captivepopulation, to supply the needs ofresearch and conservation, and toeliminate any demand for wild animals.

The Service has examined the petitionand supporting data, and finds thatsubstantial information has beenpresented indicating that the requestedreclassification may be warranted.However, more information is soughtand the Service encourages thesubmission of appropriate data,opinions, and publications in the courseof the status review that now is

initiated. In particular more informationis needed on the status of captivepopulations in North Americancountries outside of the United States.In accordance with Section 4(b)(3),within 12 months of receipt of thepetition, the Service will make anotherfinding as to whether the requestedaction is warranted, not warranted, orwarranted but precluded by other listingmeasures.

Authority: 16 U.S.C. 1361-1407; 16 U.S.C.1531-1544; 16 U.S.C. 4201-4245; Pub. L. 99-625, 100 Stat. 3500; unless otherwise noted.


Endangered and threatened species,Exports, Imports, Reporting andrecordkeeping requirements, andTransportation.

Dated: November 10, 1993.Richard N. Smith,Acting Director, Fish and Wildlife Service.[FR Dec. 93-30237 Filed 12-9-93; 8:45 am]eLUN CODr 4310-65--

64928

64929

Notices Federal RegisterVol. 58, No. 236


This section of the FEDERAL REGISTERcontains documents other than rules orproposed rules that are applicable to thepublic. Notices of hearings and investigations,committee meetings, agency decisions andrulings, delegations of authority, filing ofpetitions and applications and agencystatements of organization and functions areexamples -of documents appearing in thissection.

DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric

Administration

American Lobster Fishery

AGENCY: National Marine FisheriesService (NMFS), National Oceanic andAtmospheric Administration (NOAA),Commerce.

ACTION: Notice of intent to prepare asupplemental environmental impactstatement (SEIS); and request forcomments.

SUMMARY: NMFS announces theintention of the New England FisheryManagement Council (Council) toprepare an SEIS for proposedAmendment 5 to the American LobsterFishery Management Plan (FMP). Thepurpose of Amendment 5 is to eliminateor avoid overfishing through adoption ofa management program in the EEZ withanticipated future complementarymanagement action in state watersthrough state initiatives. The proposedmeasures, where they constitute newactions not currently in state laws andregulations, would not apply in statewaters. The Council also announces acontinuing publc process to determinethe scope of issues under considerationand significant issues related tocontrolling access to public fisheryresources. The purpose of thisnotification is to inform the public ofthis ongoing process and of theopportunity to participate in the furtherdevelopment of Amendment 5 to theFMP. All persons affected by, orotherwise interested in, the proposedamendment are invited to participate indetermining the scope of significantissues to be considered in the SEIS bysubmitting written comments. Thescoping process also will identify andeliminate from detailed study issuesthat are not significant.

DATES: Send written comments on thescoping process and scope of the SEISto the Council by December 15, 1993.ADDRESSES: Written scoping commentsand requests for additional informationshould be sent to Douglas G. Marshall,Executive Director, New EnglandFishery Management Council, 5Broadway (Route 1), Saugus, MA 01906.Copies of the public hearing documentfor this amendment may be obtainedfrom this address. Mark the outside ofthe envelope "Request for LobsterAmendment 5 public hearingdocument."FOR FURTHER INFORMATION CONTACT:Douglas G. Marshall, (617) 231-0422(see ADDRESSES).SUPPLEMENTARY INFORMATION:Amendment 4 to the FMP, implementedon December 27, 1991 (57 FR 214,January 3, 1992), suspended thescheduled increases in the minimum.carapace length, establishing aminimum gauge size of 31/4 inches (8.26cm), with the proviso that a new,approvable, and comprehensiveamendment (Amendment 5) would betransmitted to the Secretary ofCommerce (Secretary) prior to December26, 1993. Amendment 4 also proposeda definition of overfishing approved bythe Secretary with a preliminaryindication that overfishing may beoccurring in the offshore stock. As aconsequence of this preliminary finding,the Council began the scoping processby announcing its intention to developa comprehensive amendment to theFMP, which reflected an industryconsensus on how to manage the fisheryand eliminate any overfishing.

Representatives of the U.S. lobsterindustry formed the Lobster IndustryWorking Group (LIWG) and, in thespring of 1992, began development of acomprehensive statement ofmanagement principles with the aid ofthe University of New Hampshire Officeof Sea Grant. The LIWG submitted areport to the Lobster OversightCommittee and the Council. Theindustry plan (plan) was subsequentlyaccepted by the Council as the basis fordevelopment of Amendment 5 at theJanuary 13, 1993, Council meeting.

The plan basically reaffirmed thecurrent management regime, with thestipulation that the minimum sizeshould remain at 3V inches (8.26 cm),but also proposed several newmanagement measures, including a

mandatory data reporting system and ashort-term moratorium on new entrantsto the fishery. Arguably, the mostcontroversial provisions of the planincluded a limited entry system to beput in place on expiration of themoratorium and severe restrictions onthe mobile gear fishery. The plan alsoproposed a revised definition ofoverfishing.

The plan recognized that certainfacets of the overall managementregime, such as a uniform minimumsize and protection for egg-bearingfemales, should have universalapplication in the U.S. fishery.However, the industry also stated thatmanagement should recognize theheterogeneous character of the fishery;socio-economic conditions aresufficiently diverse between differentsegments of the harvesting sector towarrant tailoring the overallmanagement program accordingly. Forexample, if controls on fishing effortshould become necessary, then a sub-regional approach was recommended.whereby various programs would be putin place to achieve an overall uniformresult.

Public hearings on the proposedamendment were held at 11 locationsfrom Maryland through Maine in earlyNovember 1993, and the Council iscontinuing to consider public commenton these proposals.Proposed Management Measures andPreferred Alternative

(1) A freeze on the minimum sizelimit for all lobsters landed by Federallypermitted vessels at the currentminimum carapace length of 31/4 inches(8.26 cm). The scheduled increases inthe minimum carapace length and theescape vent size under Amendment 4would not take place.

(2) Implementation of either a 5-yearor a 2-year moratorium on new Federalvessel permits with a formal review ofthe effects of the moratorium in thethird year. Under either alternative, nonew vessel permits would be issued tovessels that did not possess a validFederal lobster fishing permit, or tovessels or fishermen that did notpossess a Federally endorsed statepermit prior to the January 9, 1991,control date, subject to the followingguidelines:

(a) If a system of assigning fishingprivileges is developed as part of theFMP, such assignments would be based

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Notices

on historical levels of participation inthe fishery prior to January 9, 1991, withconsideration for recent investmentsthat have not yet been reflected inmeasures of participation.

(b) New or re-rigged vessels would begiven consideration in the assignment offishing privileges if: (i) They were underconstruction or re-rigging for directedlobster fishing as of January 9, 1991, asevidenced by written constructioncontracts, work orders, equipmentpurchases, or other evidence ofsubstantial investment and intent toparticipate in the lobster fishery; and (ii)they possessed a lobster permit andlanded lobster prior to January 9, 1991.

(c) The record of historicalparticipation would be transferred withthe transfer of a vessel for transfersmade after January 9, 1991, unless suchtransfer is accompanied by a writtendocument indicating the agreement ofboth buyer and seller that any futurefishing privileges applicable to thatvessel are not being transferred with thevessel.

(d) The Council further intends thatany system of assigning fishingprivileges will take into considerationthe following concerns relative toindividuals or corporations that havesold a vessel within the time that maybe chosen to determine historicalfishing privileges: (i) The degree ofeconomic dependence upon the lobsterfishery, including, but not limited to,the percentage of income derived fromthe lobster fishery; (ii) The extent of pastparticipation in the lobster fishery; (iii)The demonstration of intent prior toJanuary 9, 1991, to re-enter the lobsterfishery with another vessel.

(e) Any applicant denied a permitmay appeal the denial, in writing. Anyof the following grounds may form thebasis for review: (i) The denial wasbased on mistaken or incorrectinformation or data; (ii) the applicantwas prevented by circumstances beyondhis/her control from meeting relevantcriteria; or (iii) the applicant has new oradditional information that mightchange the initial decision. Theapplicant will have the right to an oralhearing. Fishermen appealing a permitdenial will be allowed to fish until theappeal is completed. An appeal of amoratorium permit denial must be filedwithin I year of the date ofimplementation of Amendment 5.

(3) Four categories of lobster permitswould be implemented:

(a) Category A permits could beissued, upon implementation ofAmendment 5, to either commercial orrecreational vessels, including diveboats, operating any gear type, thatwould not qualify under the rules of the

moratorium. Vessels that possess aCategory A permit could not land orhave in possession more than 100lobsters.

(b) Category B permits could be issuedto vessels, other than lobster trapvessels, that qualify under themoratorium, but that cannot documentat least 300 pounds (136.07 kg) oflobster landings on at least one tripbefore the control date. Vessels applyingfor a Category B permit would be subjectto catch restrictions during the first yearof plan implementation as discussedbelow. In the second year ofimplementation of Amendment 5 andthereafter, these vessels could not landmore than 300 lobsters per day or pertrip, whichever is longer.

(c) Category C permits could be issuedto vessels, other than lobster trapvessels, that qualify under themoratorium and that can document atleast 300 pounds (136.07 kg) of lobsterlandings on at least one trip beforecontrol date. Category C permits wouldbe issued beginning one year afterimplmentation of Amendment 5.Vessels applying for a Category C permitwould be subject to catch restrictionsduring the first year of planimplementation as discussed below. Inthe second year of implmentation ofAmendment 5 and thereafter, thesevessels that fish lobster managementarea(s) requiring measures to eliminateoverfishing, would be subject torestrictions equivalent to those forlobster trap vessels in the samemanagement area(s).

(d) Category C permits could beissued to lobster trap vessels that qualifyunder the moratorium. These vesselswould be subject to the provisions of thestock rebuilding program, if thoseprovisions apply to the areas in whichthe vessels fish.

There could be restrictions onlandings in the first year ofimplementation for vessels in permitcategories B and C. A target catch of 4.5million pounds (2 million kg) based on8 percent of the total 1992 (56 millionpound (25 million kg)) landings oflobsters may be established for the totalcatch of lobsters by vessels in thesepermit categories. After this target isreached, during the first year ofimplementation only, vessels in thesecategories could be limited to landingno more than 300 lobsters per day or pertrip, whichever is longer.

(4) A new data collection systemwould require permit holders to submitlogbooks. These would provide detailedinformation on all landings, total fishingeffort and catch rates. Lobster dealerswill be required to record statisticsincluding, but not necessarily limited

to, the weight of all landed lobsters atthe first transaction, the name of thevessel, and the name of the OperatorPermit holder landing the lobsters.

(5) Operators of all vessels withFederal lobster permits would berequired to have a Federal OperatorPermit. Under one alternative, operatorswould be requiied to have at least 2years of commercial fishing experienceand to document that at least 25 percentof his/her earned income for at least 1year was derived from fishing.

(6) Any dealer of American lobstermust have a Federal Lobster Dealer'sPermit, would be held accountable forviolations of fishing regulations andcould be subject to permit sanctions.

(7) A stock rebuilding program thatwould establish four management areasin the EEZ, an Effort Management Team(EMT) for each area, and a frameworkprocess to implement possible stockrebuilding measures. The fourmanagement areas would be the Gulf ofMaine Inshore, Southern New EnglandInshore, Middle Atlantic Inshore, andOffshore areas. The boundary lines forthe proposed management areas may beadjusted and any Area may be redefinedor subdivided, as appropriate.

Each EMT would be comprised of acommon, core group of representativesfrom NMFS, Atlantic States MarineFisheries Commission (ASMFC), andthe Council, plus a group of industryrepresentatives from each area. Theindustry representation for each EMTwould be appointed by the Council andASMFC and would be comprised ofseparate sub-panels representing theindustry within the separatemanagement areas.

The EMT's would maintain aconsultative relationship with theCouncil's Lobster Committee and theASMFC Lobster Board. Immediatelyupon establishment of the EMTs,following implementation ofAmendment 5, the EMTs would begindeveloping their recommendations tothe Council and ASMF (through theCouncil's Lobster Committee and theASMFCs) regarding the initialspecification of the Stock RebuildingProgram to be established within eachmanagement area. Each EMT wouldmake its report no later than 9 monthsfollowing implementation ofAmendment 5. By the end of the secondyear of implementation of Amendment5, and at least annually thereafter, theEMTs would report to the LobsterCommittee and the ASMFC LobsterBoard the extent to which the objectivesof Amendment 5 are being achieved,and would include in their reportrecommendations for furthermanagement actions, if required. The

64930


EMTs would be required tocontinuously monitor aspects of thespecified management program andmake annual reviews regarding the mostappropriate position for boundary linesbetween management areas.

The EMT would be gurded by themost current resource stock assessment.Based on the most current assessment,the Council has determined that theGulf of Maine segment of the resourceis overfished and should be rebuilt overa 5-year period by reducing the fishingmortality rate.a total of 20 percent at therate of 5 percent per year. The Councilalso found that the Southern NewEngland inshore resource is overfishedand should be rebuilt over a 10-yearperiod by reducing the fishing mortalityrate a total of 50 percent at the rate of5 percent per year.

If overfishing is occurring, the EMTmay consider any of the followingoptional measures for any or allmanagement areas to eliminateoverfishing: (1) A minimum size limit;(2) a maximum size limit; (3) trap limits;(4) individual transferable trap limits(ITTs); (5) individual transferable quotas(ITQs); (6) seasonal closures of an entiremanagement area(s); (7) closed areas orzones within a management area(s); (8)restrictions on allowable fishing times;(9) restrictions on catches; (10)additional restrictions on gear; or (11)any other restrictions that the Council/ASMFC may designate for the purposeof reducing or controlling fishingmortality rates.

Under the framework process, theCouncil would hold public hearings toreceive comments on the stockrebuilding program provided by theEMT. After consultation with theCouncil and ASMFC and upon therecommendation of the Council andASMFC, the Director, Northeast Region,NMFS (Regional Director), wouldpromulgate appropriate regulations toimplement the Stock RebuildingProgram within 1 year after the date ofimplementation of Amendment 5.

(8) If the Council fails to take actionunder the framework process in anyyear after the first year, one of thefollowing alternative systems would beautomatically implemented: (a) A 1/32-inch (.08 cm) increase in the minimumsize limit would occur for each year inwhich the Council fails to take action;or (b) an overall quota, based on theacceptable biological catch consistentwith the 10-percent level of fishingmortality, as determined through theStock Assessment Review Committee/Stock Assessment Workshop process; or(c) management of the fishery in theEEZ would be assumed by the Secretary.

(9) An alternative to manage one ormore areas under a proposal for an ITQsystem was developed by the AtlanticOffshore Lobstermen's Association(AOLA). The proposal also containsprovisions for different classes of quota,a 3-year quota period, percentage sharesand poundage allocations, provisionsfor transfer of quota, monitoring ofthrough electronic vessels trackingdevices, etc.

(10) An overfishing definition wouldbe revised such that, when informationbased on one or more abundanceindices indicates a statisticallysignificant decline at one or moredistinct life history phases of pre-recruitlobsters to some percentage of aspecified baseline level, the resourcewould be considered to be overfished.This criterion would be added as analternative to the.current threshold of 10percent of maximum egg production perrecruit.

Timetable for SEIS Preparation andDecision-Making Schedule

The Council has adopted a tentativeschedule for preparation, review, andapproval of Amendment 5. Under thisschedule, the draft SEIS would becompleted by the Council's December 7,1993, meeting. At this meeting theCouncil will decide whether to submitAmendment 5 prior to December 26,1993, to prevent an increase in theminimum carapace length from beingimplemeiled under the current FMPprovisions. If the Council decides tosubmit the amendment by this deadline,it would then also consider whether tosubmit the draft SEIS for public review.The public will have the opportunity atthe meeting to comment on theCouncil's decision to submit the draftSEIS. If the Council decides to submitthe draft SEIS, public comments on thedraft would be accepted during a 45-daycomment period in December 1993 andJanuary 1994. After considering publiccomments, the Council staff wouldprepare a final SEIS to be included inthe review of Amendment 5. Under thisschedule, the final SEIS would besubmitted by the Council on February18, 1993, and the Secretary would

.decide whether or not to approve theamendment by April 2, 1994.

Authority: 16 U.S.C. 1801 et seq.Dated: December 3, 1993.

David S. Crestin,Acting Director, Office of FisheriesConservation and Management, NationalMarine Fisheries Service.[FR Doc. 93-30173 Filed 12-9-93; 8:45 am)BILUNG CODE 3510-22-M

COMMITTEE FOR PURCHASE FROMPEOPLE WHO ARE BLIND ORSEVERELY DISABLED

Procurement List; Addition

AGENCY: Committee for Purchase fromPeople who are Blind or SeverelyDisabled.ACTION: Addition to procurement list.

SUMMARY: This action adds to theProcurement List a service to befurnished by nonprofit agenciesemploying persons who are blind orhave other severe disabilities.

-EFFECTIVE DATE: January 10, 1994.ADDRESSES: Committee for Purchasefrom People who are Blind or SeverelyDisabled, Crystal Square 3, suite 403,1735 Jefferson Davis Highway,Arlington, Virginia 22202-3461.FOR FURTHER INFORMATION CONTACT:Beverly Milkman, (703) 603-7740.SUPPLEMENTARY INFORMATION: OnOctober 22, 1993, the Committee forPurchase from People who are Blind orSeverely Disabled published notice (58FR 54559) of the proposed addition tothe Procurement List.

After consideration of the materialpresented to it concerning the capabilityof qualified nonprofit agencies toprovide the service, fair market price,and the impact of the addition on thecurrent or most recent contractor, theCommittee has determined that theservice listed below is a suitable forprocurement by the Federal Governmentunder 41 U.S.C. 46-48c and 41 CFR 51-2.6.

I certify that the following action willnot have a significant impact on asubstantial number of small entities.The major factors considered for thiscertification were:

1. The action will not result in anyadditional reporting, recordkeeping orother compliance requirements for smallentities other than the smallorganizations that will furnish theservice to the Government.

2. The action will not have a severeeconomic impact on current contractorsfor the service.

3. The action will result inauthorizing small entities to furnish theservice to the Government.

4. There are no known regulatoryalternatives which would accomplishthe objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 46-48c) inconnection with the service proposedfor addition to the Procurement List.

Accordingly, the following service ishereby added to the Procurement List:Janitorial/Custodial, Social SecurityAdministration Building, 1530 4thStreet, Peru, Illinois.

64931

Federal Register I Vol. 58, No. 236 / Friday, December 10, 1993 / Notices

This action does not affect currentcontracts awarded prior to the effectivedate of this addition or optionsexercised under those contracts.Beverly L. Millman,Executive Director.[FR Doc. 93-30240 Filed 12-9-93; 8;45 am)BILLING CODE 6820-33-P

Procurement List;, Proposed Additions

AGENCY: Committee for Puichase FromPeople Who Are Blind or SeverelyDisabled.ACTION: Proposed additions toprocurement list.

SUMMARY: The Committee has receivedproposals to add to the Procurement Listservices to be furnished by nonprofitagencies employing persons who areblind or have other severe disabilities.COMMENTS MUST BE RECEIVED ON ORBEFORE: January 10. 1994.ADDRESSES: Committee for PurchaseFrom People Who Are Blind or SeverelyDisabled, Crystal Square 3, suite 403,1735 Jefferson Davis Highway,Arlington, Virginia 22202-3461.FOR FURTHER INFORMATION CONTACT:Beverly Milkman, (703) 603-7740.SUPPLEMENTARY INFORMATION: Thisnotice is published pursuant to 41U.S.C. 47(a)(2) and 41 CFR 51-2.3. Itspurpose is to provide interested personsan opportunity to submit comments onthe possible impact of the proposedactions.

If the Committee approves theproposed additions, all entities of theFederal Government (except asotherwise indicated) will be required toprocure the services listed below fromnonprofit agencies employing personswho are blind or have other severedisabilities.

I certify that the following action willnot have a significant impact on asubstantial number of small entities.The major factors considered for thiscertification were:

1. The action will not result in anyadditional reporting, recordkeeping orother compliance requirements for smallentities other than the smallorganizations that will furnish theservices to the Government.

2. The action does not appear to havea severe economic impact on the currentcontractors for the services.

3. The action will result inauthorizing small entities to furnish theservices to the Government.

4. There are no known regulatoryalternatives which would accomplishthe objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 46-48c) in

connection with the services proposedfor addition to the Procurement List.

Comments on this certification areinvited. Commenters should identify thestatement(s) underlying the certificationon which they are providing additionalinformation.

It is proposed to add the followingservices to the Procurement List for

reduction by the nonprofit agencyisted:

Administrative Services, U.S. ArmyCorps of Engineers, Nashville District,Estes Kefauver Building and AdjacentBuildings, Nashville, Tennessee

Nonprofit Agency: GoodwillIndustries-Middle Tennessee, Inc..Nashville, Tennessee

Commissary Shelf Stocking andCustodial. Fort Shafter, Hawaii

Nonprofit Agency: Goodwill Industriesof Honolulu, Honolulu, Hawaii

Janitorial/Custodial, Buildings 433, 434,435,436,437, 952, 953,954, 956, 975.980, 20140, 20202, 20204, 20350,20602, 20604, 20684, 20685,20686,Kirtland Air Force Base, New Mexico

Nonprofit Agency: The RehabilitationCenter, Inc., Albuquerque, NewMexico.

Beverly L.Milkman,Executive Director.[FR Doc. 93-30239 Filed 12-9-93; 8:45 am]SLUNG COO 04-

DEPARTMENT OF DEFENSE

Office of the Secretary

Amendment to Department of DefenseDecision To Terminate Foreign MilitaryFinancing for Direct CommercialContracts

AGENCY: Office of the Secretary, DoD.ACTION: Notice.

SUMMARY: The Department of Defense(DoD) extends the effective date of IJanuary 1994 for terminating the use ofForeign Military Financing (FMF)(announced by DoD letter, 1-02446/93,dated 8 June 1993) for funding directcommercial contracts (DCCs). Congressenacted legislation, section 572 of theFY 94 Foreign OperationsAppropriations Act (Public Law 103-87), requiring DoD to continue the useof FMF for funding DCCs until allparties affected by any such changeshave been consulted. Accordingly, DoDhas extended the policy for FMFfunding of DCCs until 1 July 1994 toallow time for the required consultationand to give U.S. industry, foreigncountries, and other affected parties anopportunity to provide additionalcomments concerning this policy

change. In accordance with the newlegislation, the DoD solicits anycomments concerning this policychange for FMF funding of DCCs.DATES: Submit comments before 31January 1994 to:ADDRESSES: Office of the Secretary ofDefense, Defense Security AssistanceAgency, rm. 4B740, ATTN: OperationsManagement Division, Pentagon,Washington, DC 20301-2800.FOR FURTHER INFORMATION CONTACT:Major Kim Leach (703) 697-8108 orFAX (703) 697-1656.

Dated: December 7,1993.L. Bynum,Alternate OSD Federal Register LiaisonOfficer, Department of Defense.[FR Doc. 93-30192 Filed 12-9-93; 8:45 amlDaJNG COO 5000-4-

Public Information CollectionRequirement Submitted to OMB forReview

ACTION: Notice.

The Department of Defense hassubmitted to OMB for clearance, thefollowing proposal for collection ofinformation under the provisions of thePaperwork Reduction Act (44 U.S.C.,chapter 35).

Title and OMB control number: PostElection Survey; OMB Control Number0704-0125.

Type of request: Extension.Number of respondents: 10,500.Responses per respondent: 1.Annual responses: 10,500.Average burden per response: .166

hours.Annual burden hours: 1,743.Needs and uses: 42 U.S.C. 1973ff,

"The Uniformed and Overseas CitizensAbsentee Voting Act of 1986,"(UOCAVA), is administered on behalf ofthe Secretary of Defense by the FederalVoting Assistance Program. It requires areport to be submitted to the Presidentand to the Congress, "* * * on theeffectiveness of assistance under thistitle, including a statistical analysis ofvoter participation and a description ofState-Federal cooperation." UOCAVAcovers the voting rights of all membersof the Uniformed Services to include theNational Oceanic and AtmosphericAdministration, Public Health Service,Merchant Marine, all eligibledependents, and civilian citizensoutside the United States. The post-election survey is conducted on astatistically random basis to determineparticipation rates which arerepresentative of all citizens covered bythe Act, and is designed to evaluate theeffectiveness of the overall absentee

64932


voting program. The informationcollected hereby is used for overallprogram management and improvement,and to compile the Congressionallymandated report to the President andthe Congress.

Affected public: Individuals orhouseholds; State and localgovernments.

Frequency: Biennially (Form D) andQuadrennially (Form B).

Respondent's obligation: Voluntary.OMB desk officer: Mr. Edward C.

Springer.Written comments and

recommendations on the proposedinformation collection should be sent toMr. Springer at the Office ofManagement and Budget, Desk Officerfor DoD, room 3235, New ExecutiveOffice Building, Washington, DC 20503.

DOD clearance officer: Mr. William P.Pearce. Written requests for copies ofthe information collection proposalshould be sent to Mr. Pearce, WHS/DIOR, 1215 Jefferson Davis Highway,Suite 1204, Arlington, VA 22202-4302.

Dated: December 7, 1993.Patricia L Toppings,Alternate OSD Federal Register LiaisonOfficer, Department of Defense.[FR Doc. 93-30191 Filed 12-9-93; 8:45 am]BILUNG CODE 5000-04-4

DEPARTMENT OF EDUCATIONProposed Information Collection

Requests

AGENCY: Department of Education.'ACTION: Notice of proposed informationcollection requests.

SUMMARY: The Director, InformationResources Management Service, invitescomments on the proposed informationcollection requests as required by thePaperwork Reduction Act of 1980.DATES: Interested persons are invited tosubmit comments on or before January10, 1994.ADDRESSES: Written comments shouldbe addressed to the Office ofInformation and Regulatory Affairs,Attention: Dan Chenok: Desk Officer,Department of Education, Office ofManagement and Budget, 726 JacksonPlace NW., room 3208, New ExecutiveOffice Building, Washington, DC 20503.Requests for copies of the proposedinformation collection requests shouldbe addressed to Cary Green, Departmentof Education, 400 Maryland AvenueSW., room 4682, Regional OfficeBuilding 3, Washington, DC 20202-4651.FOR FURTHER INFORMATION CONTACT:

Cary Green (202) 401-3200. Individualswho use a telecommunication device forthe deaf (TDD) may call the FederalInformation Relay Service (FIRS) at 1-800-877-8339 between 8 a.m. and 8p.m., Eastern time, Monday throughFriday.SUPPLEMENTARY INFORMATION: Section3517 of the Paperwork Reduction Act of1980 (44 U.S.C. chapter 35) requires thatthe Office of Management and Budget(OMB) provide interested Federalagencies and the public an earlyopportunity to comment on informationcollection requests. OMB may amend orwaive the requirement for publicconsultation to the extent that publicparticipation in the approval processwould defeat the purpose of theinformation collection, violate State orFederal law, or substantially interferewith any agency's ability to perform itsstatutory obligations. The Director of theInformation Resources ManagementService, publishes this notice containingproposed information collectionrequests prior to submission of theserequests to OMB. Each proposedinformation collection, grouped byoffice, contains the following: (1) Typeof review requested, e.g., new, revision,extension, existing or reinstatement; (2)Title; (3) Frequency of collection; (4)The affected public; (5) Reportingburden; and/or (60 Recordkeepingburden; and (7) Abstract. OMB invitespublic comment at the address specifiedabove. Copies of the requests areavailable from Cary Green at the addressspecified above.

Dated: December 7, 1993.Cary Green,Director, Information Resources ManagementService.

Office of Special Education andRehabilitative Services

Type of Review: Reinstatement.Title: The Performance Report for

Early Intervention Program for Infantsand Toddlers with Disabilities Progran,Under Part H of the Individuals withDisabilities Education Act (IDEA).

Frequency: Annually.Affected Public: State or local

governments.Reporting Burden:Responses: 57. Burden Hours: 855.Recordkeeping Burden:Recordkeepers: 0. Burden Hours: 0.Abstract: States are required to submit

an annual report to the Secretary fromthe State Lead Agency on the status ofearly intervention programs operating inthe State for eligible children. This is toinclude a description of the services andhow funds were spent. The informationcollected will be used by ED to

determine a State's eligibility forreceiving a grant award under thisprogram.

Office of Postsecondary EducationType of Review: New.Title: Confirmation Report for the

Graduate Assistance in Areas ofNational Need Program FellowshipRecipients.

Frequency: Annually.Affected Public: Non-profit

institutions.Reporting Burden:Responses: 150. Burden Hours: 150.Recordkeeping Burden:Recordkeepers: 0. Burden Hours: 0.Abstract: The confirmation Report for

the Graduate Assistance in Areas ofNational Need Program FellowshipRecipients is needed by universitydepartments to document the studentswho receive fellowships under theGraduate Assistance in Areas ofNational Need grant. The U.S.Department of Education needs the formto measure and enforce compliance withthe law and regulations.[FR Doc. 93-30259 Filed 12-9-93; 8:45 am]BILUNG CODE 4000-01-M

[CFDA No. 84.21513j

Fund for Innovation In Education(FIE)--Comprehensive School HealthEducation ProgramAGENCY: Department of Education.ACTION: Notice of extension of deadlinedate for transmittal of applications andannouncement of additional invitationalpriority.

SUMMARY: A notice inviting applicationsfor new awards for fiscal year 1994under the Fund for Innovation inEducation (FIE): Comprehensive SchoolHealth Education Program appeared onSeptember 24, 1993 in the FederalRegister (58 FR 50145). Subsequently,the Congress passed appropriationlegislation for the Department ofEducation. In considering the intent ofthe Senate's Report accompanying theappropriation legislation, the Secretaryhas decided to add a second invitationalpriority to the previously publishednotice inviting applications for newawards under the FE: ComprehensiveSchool Health Education Program andto extend the deadline for transmittingapplications to allow applicants time torespond to the new invitational priority.DEADLINE FOR TRANSMITrAL OFAPPLICATIONS: The deadline forapplications has been extended fromDecember 10. 1993 to January 21, 1994.DEADLINE FOR INTERGOVERNMENTALREVIEW: The deadline for

64933


intergovernmental review has beenextended from February 10,1994 toApril 21, 1994.

PRIORmES: Under 34 CFR 75.105(c)(1)the Secretary Is particularly interestedin applications that meet one or more ofthe following invitational priorities.However, an application that meets oneor more of these invitational prioritiesdoes not receive competitive or absolutepreference over other applications:

Invitational Priority 1--School andFamily Partnerships

Projects in which schools work inpartnerships with families and thecommunity on comprehensive schoolhealth education for grades K-12.

Within this invitational priority theSecretary particularly inviteszpplications that address one of thefollowing:

(a) Demonstration or teacherprofessional development programs thatinvolve new approaches to curriculum,instruction, and assessment inelementary or secondary schools orboth.

(b) Projects in elementary orsecondary schools or both to provideteachers and administrators withinservice professional development toassist in the implementation of newcomprehensive school health educationprograms.

Invitational Priority 2-Low-Birthweight Babies

Projects which implementprofessional development programs forpre-service or in-service training ofteachers, nutritionists, and appropriatehealth professionals who providecomprehensive health education tostudents at risk of having low-birthweight babies. Projects shouldincorporate the best and most currentresearch on reducing the incidence oflow-birthweight babies, includingnutrition, prenatal care and effective useof health services, and should servecommunities with a high incidence oflow-birthweight babies.

FOR APPLICATIONS OR INFORMATIONCONTACT: Shirley Jackson or JohnRoddy, U.S. Department of Education,555 New Jersey Avenue, NW., room300-Q Washington, DC 20208-5524.Telephone (202) 219-1556. Individualswho use a telecommunications devicefor the deaf (TDD) may call the FederalInformation Relay Service (FIRS) at 1-800-877-8339 between 8 a.m. and 8p.m., Eastern time, Monday throughFriday.

Program Authority: 20 U.S.C. 3151, 3155.

Dated: December 7, 1993.Sharon P. Robinson,Assistant Secretary for Educational Researchand Improvement.[FR Doc. 93-30255 Filed 12-9-93; 8:45 am]BILUNG CODE 4000-01-P

DEPARTMENT OF ENERGY

Pittsburgh Energy Technology Center;,Restricted Eligibility

AGENCY: Pittsburgh Energy TechnologyCenter, Department of Energy.ACTION: Determination for RestrictedEligibility Solicitation.

SUMMARY: The Department of Energy(DOE), Pittsburgh Energy Technologyannounces that pursuant to 10 CFR600.7(b)(1), and in support of theMetairie Site Office (MSO), it intends toconduct a competitive ProgramSolicitation No. DE-PS22-94MT94001and to award on a restricted eligibilitybasis, financial assistance (grants) toU.S. Historically Black Colleges andUniversities (who can show evidence ofa collaborative effort with industry), insupport of innovative research andadvanced concepts pertinent to fossilresource conversion and utilization.Proposals will be subjected to acomparative merit review by a DOEtechnical panel, and awards will bemade to a limited number of proposerson the basis of the scientific merit of theproposal, application of relevantprogram policy factors, and theavailability of funds.ADDRESSES: Department of Energy,Pittsburgh Energy Technology Center,Acquisition and Assistance Division,P.O. Box 10940, MS 921-118,Pittsburgh, PA 15236.FOR FURTHER INFORMATION CONTACT: Fora copy of this solicitation or for furtherinformation, please write to: U.S.Department of Energy, PittsburghEnergy Technology Center, Acquisitionand Assistance Division, P.O. Box10940, MS 921-118, Pittsburgh, PA15236-0940, Attn: Jo Ann C. Zysk,Contract Specialist.SUPPLEMENTARY INFORMATION:Solicitation Number DE-PS22-94MT94001.

Title of Solicitation"Support of Advanced Fossil

Resource Utilization Research atHistorically Black Colleges andUniversities"OBJECTIVE: The Department of Energyseeks proposals from Historically BlackColleges and Universities (HBCUs) andHBCU-affiliated research institutes (in

collaboration with the private sector) forinnovative research and advancedconcepts pertinent to fossil resourceconversion and utilization. Theresultant grants are intended tomaintain and upgrade educational,training, and research capabilities of ourHBCUs in the fields of science andtechnology related to fossil energyresources; to foster private sectorparticipation, collaboration, andinteraction with HBCUs; and to providefor the exchange of technicalinformation and to raise the overalllevel of HBCU competitiveness withother institutions in the field of fossilenergy research and development. Thusthe establishment of linkages betweenthe HBCU and private sector fossilenergy community are critical to thesuccess of this program, and equallyconsistent with the Nation's goal ofensuring a future supply of fossil fuelscientists and engineers from apreviously under-utilized resource.Eligibility for participation in thisProgram Solicitation is restricted toHistorically Black Colleges andUniversities (HBCUs) and HBCU-affiliated research institutes, and onlythose that meet all of the followingcriteria may submit applications inresponse to this solicitation: ThePrincipal Investigator or a Co-PrincipalInvestigator must be a teachingprofessor at the submitting universitylisted in the application; and at leastone student registered at the universityis to be compensated for workperformed in the conduct of researchproposed in the application and eachHBCU applicant must reflectcollaboration with industry, i.e., theprivate sector. Proposals from HBCU-affiliated research institutes must besubmitted through the college oruniversity with which they areaffiliated. The university (not theuniversity-affiliated research' institute)will be the recipient of any resultantDOE grant award. A small or largebusiness enterprise will qualify as a"private" sector entity; however, thefollowing are specifically excluded fromrecognition as private sectorcollaborators: Federal, state and/or localgovernment agencies and non-HBCUcolleges and universities. Collaborationby the private sector with the HBCUmay be in the form of cash cost sharing,consultation, HBCU access to industrialfacilities or equipment, experimentaldata and/or equipment not available atthe university, or as a subgrantee/subcontractor to the HBCU.

Areas of InterestIn order to develop a focused national

and regional program of HBCU research

64934


on fossil technology and resources, theDepartment is particularly interested ininnovative research and advancedconcepts pertinent to fossil resourceconversion and utilization limited to thenine (9) technical topics listed below.Some examples of subtopics in eachcategory are also provided; however,these examples are generally not allinclusive.

Topic 1-Advanced EnvironmentalControl Technology for Coal

Grant applications in support ofAdvanced Environmental ControlTechnology for Coal are only solicitedfor the following subtopics:

Coal Preparation

The research objectives are to developtechnologies for (1) deeply depyritizingcoal so that the clean coal productwould generate significantly less S02emissions when fired in utility boilers,and (2) preparing a cleaned coal productthat can be used interchangeably withdistillate and residual fuel oils, ornatural gas, with minimum retrofit.Hot Gas Stream Cleanup

The research objectives are: (1)TECHNIQUES for (a) removing physicaland chemical contaminants to levelsthat are compatible with diesel, gasturbine, and fuel cell systems, (breducing emissions to levels below thepromulgated standards for pulverizedcoal boilers, and (c) reducing gas streamcontaminants to levels that arecompatible with liquids production; (2)PROCESSES that (a) have multi-contaminant control capability, (b)directly convert sulfur in fuel gas fromcoal gasifiers to elemental sulfur, (c)remove ammonia and/or chloride in fuelgas from coal gasifiers. (d) use catalystson particulate filters, processes usinghigh temperature, high pressuremembranes for contaminant separation,and (e) reduce S02 and NO. emissionsby reducing the sulfur and nitrogencontent of gas-phase tars in fuel gasfrom coal gasifiers. Diagnosticinstrumentation for measurements inhot gas streams are also of interest.

Advanced High Efficiency EmissionsControl

(NO, NO2, and N2), and carbon dioxide(CO2).

Waste Management

The research objectives are: (1) Toinitiate or advance the development ofnovel uses for coal-derived residues,especially for the wastes from advancedcoal combustion or conversiontechnologies; (2) to utilize the residuesfrom the sulfur capture wastes producedin fluidized-bed combustion, limestoneinjection multistage burners, advancedflue gas cleaning, or gasificationprocesses; (3) for cost avoidancetechnology for disposal of these wasteproducts by utilities and smaller scaleusers of advanced coal technologies;and (4) for advance utilizationtechniques for waste from small-sizedindustrial boilers.

Topic 2-Advanced Coal Utilization

Grant applications in support ofAdvanced Coal Utilization are onlysolicited for the following subtopics:

Advanced Coal Combustion Systems

The research objective is the directcombustion of pulverized coal or otherdry, liquid, or slurry coal-based fuels.ineither slagging or non-slagging systemsother than fluidized beds and heatengines (residential, commercial,industrial, and utility applications).

Fluid Bed Combustion (FBC)

The research objective is for the directutilization of coal fluidized combustionfor both atmospheric and pressurizedFBCs for innovative research to (1)Reduce capital, operating, andmaintenance costs of FBC systems, (2)improve solids handling, (3) improveenvironmental performance (withfurther reduction in emissions ofparticulates and nitrogen oxides givenspecial emphasis), (4) improvereliability and operability of critical FBCsystem components, (5) developinstrumentation for characterization ofFBC parameters, and (6) integrate FBCswith other components (e.g., absorptioncoolers or cogeneration systems) toimprove the economics of small FBCsystems.

Topic 3-Coal Liquefaction Technology

Grant applications in support of CoalThe research objectives are innovative Liquefaction Technology are only.

concepts (applicable to coal-fired solicited for the following subtopics:combustors in the electric utility,industrial, commercial, and residential Advanced Concepts for Conversion ofsectors) that allow more efficient, Coal to Liquidseconomical, and environmentally The research objectives are: (1) Novelacceptable treatment of flue gas from catalysts or reaction chemistry toatmospheric coal-fired combustors for remove oxygen in the initial stages ofreduction of pollution emissions of direct coal liquefaction with minimal oisulfur dioxide (SO2), nitrogen oxides reduced hydrogen consumption; and (2

preconversion processing to minimizethe occurrence of condensation/retrogressive reactions during the initialreaction stages of coal liquefaction andthe use of well dispersed (disposable)catalysts to promote more efficientconversion reactions.

Advanced Concepts for Conversion ofSyngas to Liquids

The research objectives are: (1)Improved methods of methanolsynthesis and of novel single stepprocesses for producing gasoline anddiesel hydrocarbons, (2) simpler routesto higher alcohols and ethers that can beused as octane enhancers, (3) novelcatalyst systems making use of modemmethods of materials science tofacilitate the desired reaction sequences(these should be more active, morestable, and more selective thanconventional catalysts), (4) processschemes which make more effective useof heat generated in synthesis, (5) novelsystems which convert syngas directlyinto liquids or liquid precursors, and (6)improved instrumentation andanalytical techniques that allow on-linedetermination of process streamcomposition or improvecharacterization of catalysts.

Coal-Oil Coprocessing

The research objectives are: (1) Betterunderstanding the chemistry ofinteraction between the residue and thecoal, (2) improved demetalization, or(3) novel techniques for the productionof hydrogen from various coals andcoal-based chars for use in direct.!iquefaction.

Advanced Catalysts

The research objective is theenhancement of depolymerizationreactions while repressing thecondensation reactions.

Topic 4-Biotechnology for FossilEnergy

Grant applications in support ofBiotechnology for Fossil Energy are onlysolicited for the following subtopics:

Beneficiation of Coal Resources

The research objectives are: Studiesand application of biotechnology toremove these organic and inorganiccontaminants from typical U.S. coals atmild operating conditions.

Conversion of Fossil Energy Resources

The research objectives are: Types ofbiotechnical resource modification thatinclude conversion of fossil energyresources to liquid or gaseous fuels,viscosity reduction of high viscosity

64935

r)


materials, or release of organic materialsbound in inorganic matrices.

Bioreactors and Bioprocess Efficiency

The research objectives are: (1)Improved approaches (processes,processing systems, and (2) processingequipment) for bioprocessing fossilresources (or their products) includingnovel and innovative techniques eitherto increase bioprocess efficiency or toimprove bioreactor designs.

Enhanced Oil and Gas Recovery

The research objectives are: (1) Thedevelopment of processes usingmicroorganisms or their products in therecovery of light and heavy oils ornatural gas from low producing fields,specifically addressing newmicroorganisms capable of growing inunderground reservoirs of oil or gas, andexamining their metabolic andbiochemical characteristics; and (2) bothlaboratory research and field testingdesigned to demonstrate the validity oflaboratory results.

Topic 5-Enhanced Oil Recovery

Grant applications in support ofEnhanced Oil Recovery are onlysolicited for the following subtopics:

Recovery of Light Oil

The research objective is to improvethe recovery of light oil in the followingareas: (1) In Depth Sweep Improvementfor Enhanced Oil Recovery Processes;(2) Near Well Bore Sweep Improvementfor Enhanced Oil Recovery Processes;and (3) Novel Surfactants for HighSalinity, High Hardness, and HighTemperature Reservoir Brines.

Recovery of Heavy Oil

The research objectives are noveltechniques to: (1) Reduce wellbore heatlosses using an effective, inexpensiveinsulating fluid in the tubing-casingannulus; (2) measure the downholesteam quality to determine wellboreheat loss and thus to allow design of

'better production operations; and (3)improve the effective sweep of thereservoir by reducing the effects ofoverriding gravity segregation,insufficient mobility control, andheterogeneities.

Oil-Field Geoscience

The research objectives are: (1) Novelmethods of characterization to quantifyreservoir parameters including porosity,permeability, pore structure, capillarypressure, fracture patterns, and faciesgeometry; and (2) development of oildata bases and oil atlas compilation andreservoir classification.

Topic 6-Advanced Technology for theRecovery of Natural Gas

Grant applications in support ofAdvanced Technology for the Recoveryof Natural Gas are only solicited for thefollowing subtopics:

Advanced Geotechnology in ProductionApplications

The research objectives are innovativeapproaches to improve the recovery oforiginal gas in place and/or oninexpensive new geotechnicalapproaches or concepts to restore theflow rate of old gas wells.

Advanced Instrumentation andInterpretation Techniques for Locatingand Characterizing Natural GasResources

The research objectives are advancedinstrumentation and interpretationtechniques for locating andcharacterizing gas reservoirs, includinghydrates and deep gas, to improveresource recovery and to increasereserves.

Advanced Concepts for Natural GasConversion to Liquids

Research objectives are advancedconcepts conversion of natural gas toliquids including catalytic andnoncatalytic processes (with emphasison the latter) for converting natural gasto liquid fuels.Topic 7-Advanced EnvironmentalConsiderations in the Recovery andProcessing of Oil and Natural Gas

Grant applications in support ofAdvanced EnvironmentalConsiderations in the Recovery andProcessing of Oil and Natural Gas areonly solicited for innovative methodsand concepts that allow more efficient,effective, and economical reduction ofenvironmental risk from the processingand primary, secondary, and enhancedextraction of oil and natural gas.Research relating to open oil spillcleanup technologies will not beconsidered.

Topic 8-Heavy Oil Upgrading andProcessing

Grant applications in support HeavyOil Upgrading and Processing, aresought for the following subtopics:

(a) Improved Understanding of theChemistry and the Thermodynamics ofAdding Hydrogen to Heavy Feedstocks;

(b) Improved Understanding of theChemistry and the Thermodynamics ofthe Removal of the Contaminants, i.e., S,N, 0, Metals, etc., from HeavyFeedstocks;

(c) Development of New and LessExpensive Means for Producing

Hydrogen from Feedstocks other thanLight Hydrocarbons which are ExcellentFuels as is;

(d) Development of New and LessExpensive Contaminant RemovalProcesses for Heavy Oils along withEnvironmentally Acceptable Means ofDisposing of the Contaminants whenRemoved;

(e) Development of New Knowledgeto be used to Improve Catalytic Crackingand Hydrocracking Catalysts andProcess; and

(f) Development of the Knowledge,Catalysts and Processes Necessary toEliminate the Production of PetroleumCoke or the Ability to Liquefy it so thatit can be Recycled to the Refinery.Topic 9-Faculty/Student ExploratoryGrants

DOE is seeking grant applicationsfrom HBCU faculty and/or students fora supportable basic premise on any oneof the subtopics covered under theabove eight (8) technical topics. DOEwill provide "seed" grants to theselected HBCU(s) to enable the facultyand/or student researcher(s) to conductthe proposed exploratory research andfurther develop the stated premise. Thisis the only topic (Topic nine (9)) underthis Program Solicitation that does notrequire initial private sectorcollaboration for an application to beconsidered for selection.

AwardsDOE anticipates issuing financial

assistance (grants) for each project. DOEreserves the right to support or notsupport any or all applications receivedin whole or in part, and to determinehow many awards may be made throughthe solicitation subject to fundsavailable in this fiscal year. Thelimitation on the maximum DOEfunding for each selected grant to beawarded under this Program Solicitationis as follows;

Maximumaward

Topics 1-8:To 12 months grant dura-

tion .................................13-24 months grant dura-

tion ...................................25-60 months grant dura-

tion ........................... * .......Topic 9:

To 12 months grant dura-tion ...................................

$80,000.00

$140,000.00

$200,000.00

$10,000.00

Approximately one (1) million dollarsis planned for this solicitation. The totalshould provide support forapproximately four (4) to eight (8) R&Dproposal selections (Topics 1-8), and

64936


approximately two (2) to six (6) facility/student exploratory proposal selections(Topic 9). The Program Solicitation isexpected to be ready for mailing on orabout November 26, 1993. Applicationsmust be prepared and submitted inaccordance with the instructions andforms in the Program Solicitation. To beeligible applications must be receivedby the Department of Energy by theclosing date stated in the solicitation.Dale A. SicUianoContracting Officer.[FR Doc. 93-30264 Filed 12-9-93; 8:45 amlBIuNG C00 6450-01-P

Financial Assistance Award; Intent ToAward Cooperative Agreement to theCouncil of State Governments-Midwestern Office

AGENCY: U.S. Department of Energy(DOE).ACTION: Notice of intent to make acompetitive financial assistance award.

SUMMARY: The Department of Energyannounces that pursuant to 10 CFR600.6(a)(5), it is making a discretionaryfinancial assistance award based on thecriterion set forth at 10 CFR600.7(b)(2)(i)(D) to the Council of StateGovernments, Midwestern Office, underCooperative Agreement Number DE-FC01-94RW00288. The objections of thecooperative agreement are to provideassistance to this nonprofit regionalassociation to monitor and informregional officials on issues related to thetransportation and storage of high-levelradioactive waste. This effort will havea total estimated cost of $894,557 to beprovided by the DOE.FOR FURTHER INFOR NATIOf CONTACT:U.S. Department of Energy; Office ofPlacement and Administration; Attn:Douglas L Baptist, HR-531.23; 1000Independence Avenue, SW.,Washington, DC 20585.SUPPLEMENTARY INFORMATION;

ScopeThe cooperative agreement will

provide funding to the Council of StateGovernments, Midwestern Office, whichwill: disseminate information toregional officials regarding the states ofinterim storage and the transportation ofhigh-level radioactive waste in theirstates; monitor relevant regionalemergency preparedness and emergencyresponse initiatives; monitor andcomment on the nuclear wastetransportation related activities of theCommercial Vehicle Safety Alliance;monitor and comment on theDepartment of Energy's activities to

develop transportation casks; and,participate in meetings withDepartmental representatives. Inaccordance with 10 CFR600.7(b)(2)(i)(D), it has been determinedthat the Council possesses the uniquedomestic capability to successfullyperform the proposed activities basedon its position as the chartered boardrepresenting midwestern states onenergy matters pertaining to nuclearwaste.

Issued in Washington, DC, oq November17, 1993.Scott Sheffield,Director, Headquarters Operations DivisionB, Office of Placement and Administration.[FR Doc. 93-30262 Filed 12-9-93; 8:45 am)BILLING COO 6450-01-M

Office of Energy Research

Energy Research Financial AssistanceProgram Notice 94-07: ComputerHardware Advanced Mathematics andClimate Physics (CHAMMP) Program

AGENCY: U.S. Department of Energy(DOE).,CTION: Notice inviting grantapplications.

SUMMARY: The Office of Health andEnvironmental Research (OHER) of theDepartment of Energy (DOE) herebyannounces its interest in receivingFinancial Assistance applications tosupport the improvement of decade-to-century climate prediction inconjunction with the EnvironmentalSciences Division's (ESD) ComputerHardware, Advanced Mathematics andClimate Physics (CHAMMP) Program.

This notice requests applications forgrants to support:

(Category 1): Theoretical limits toclimate prediction over decade to multi-century time frames with sub-continental and smaller scale spatialaccuracy.

(Category 2): The development ofimproved mathematical techniques, 0model formulations and computeralgorithms for atmosphere, ocean andcoupled atmosphere-ocean generalcirculation models (GCM) that moreaccurately and efficiently describe andpredict global climate system behavioron the time and space scales mentionedabove using advanced, parallel-processing scientific supercomputers.

(Category 3): The development ofimproved representations of key climateprocesses (surface processes, connectivetransport, etc.) that accurately simulatethese processes on the appropriatescales used in GCM-based climate

models that simulate decade-to-centuryclimate change.

(Category 4): Continuation ofactivities previously funded by DOEunder Program Notice 91-03 datedDecember 5, 1990, with grants thatconclude in FY 1994.DATES: Formal applications submitted inresponse to this notice must be receivedby 4:30 p:m. e.s.t., March 1. 1994, topermit timely consideration for awardin Fiscal Year 1994.ADDRESSES: Formal applicationsreferencing Program Notice 94-07should be forwarded to: U.S.Department of Energy, Office of EnergyResearch, Acquisition and AssistanceManagement Division, ER-64 (GTN),Washington, DC 20585. Attn: ProgramNotice*94-07. The following addressmust be used when submittingapplications by U.S. Postal ServiceExpress Mail, any commercial maildelivery service, or when hand carriedby the applicant: U.S. Department ofEnergy, Office of Energy Research,Acquisition and AssistanceManagement Division, ER-64, 19901Germantown Road, Germantown, MD20874.FOR FURTHER IFORMATION CONTACT: Mr.Michael Riches, U.S. Department ofEnergy. Office of Health andEnvironmental Research, EnvironmentalSciences Division, ER-74 (GTN),Washington, DC 20585, telephone (301)903-4328.SUPPLEMENTARY INFORMATION: One of themajor objectives of the ESD is toimprove the performance and accuracyof Earth climate prediction models tomake better forecasts of the climatesystem response to increasingconcentrations of greenhouse gases.

The CHAMMP research program is amulti-year program to accelerate thedevelopment of more accurate anduseful climate prediction capabilities toforecast climate change on sub-continental and smaller scales over timeperiods ranging from a decade to severalcenturies. It emphasizes more definitivetheoretical foundations and improvedcomputational methods on the currentand next generations of high-performance scientific supercomputersto dramatically increase both thethroughput and accuracy of model-based predictions of climate change.

To ensure that the program meets thebroadest needs of the researchcommunity and the specific needs of theESD, the successful applicants willparticipate as members of the CHAMMPScience Team along with selectedscientists from other ESD programs thatrelate to the CHAMMP program. Costsfor participation in the Science Team

64937


meetings and workshops should beincluded in the respondent'sapplication. Yearly estimates forScience Team travel should be based onone trip of five days to Washington, DC,one trip of five days to San Francisco,CA, and one trip of five days to Denver,CO.

Successful applicants for grants insupport of Category 1 will conductresearch into the capability of climatemodels to perform decade-to-centurypredictions of climate behavior forregions encompassing 104 - 109 km 2.These applicants must demonstrate therole of their research in defining thepredictability limits for model-basedclimate forecasts, because models willbe used to determine the role of variousfactors, both natural and anthropogenic,in climate change. These studies mayinclude, but are not limited to, boththeoretical and modeling investigationsof climate system variability overdecade to century scales.

Successful applicants for grants insupport of Category 2 will conductresearch leading to the development ofnew mathematical techniques andnumerical algorithms that can beincorporated into climate modelsrunning on highly parallel (50-2000processor) computer systems of the typeenvisioned to be the next generation ofscientific supercomputers capable ofperforming over 1011 floating-pointoperations per second (100 gigaFLOPS)in climate modeling applications.Applicants must demonstrate the role oftheir research in improving the accuracyand/or the computational efficiency ofGCM-based climate models to performforecasts of decade-to-century climatechange. These techniques andalgorithms may deal with any or all ofthe climate system processrepresentations that will comprise GCM-based climate prediction models. Theseprocesses include, but are not limitedto, atmospheric and oceanic dynamicsand transport, surface energy and massexchange, atmospheric radiativetransfer, ocean convection, and sea-icedynamics and thermodynamics.

Successful applicants for grants insupport of Category 3 will conductresearch to improve the representationsof climate system processes forinclusion in GCM-based climate modelsused for the prediction of decade-to-century climate change. These studieswill explore methods for incorporatingthe results of the U.S. Global ChangeResearch Program's observational andexperimental programs into modelcomponents that accurately describeclimate system processes at the modelresolution scales typically used for

climate predictions over decades andlonger time frames.

Successful applicants for continuationof grants placed under Program Notice91-03, Category 4, will demonstrate (a)continued relevance of their work to thegoals of the CHAMMP program; (b) thequality and relevance of workconducted under previous support tothe goals of the CHAMMP Program,including a listing of the publications,presentations and reports; and (c)relevant contributions to thedevelopment of the CHAMMP Program,including participation in and theorganization of meetings and workshopsand collaboration with modeldevelopment activities of the CHAMMPprogram. Applicants should include aspecial section entitled"Accomplishments Under PreviousSupport" which addresses items (b) and(c) discussed directly above. Applicantsshould be prepared to provide, on shortnotice, complete copies of allpublications, reports, etc. listed in thissection, should they be required by peerreviewers.

It is anticipated that approximately$1,500,000 will be available for awardsfor the combined activity underCategories 1, 2, 3, and 4 above in FY1994, contingent upon the availability ofappropriated funds. Multiple yearfunding of awards is expected, alsocontingent upon availability of funds.The allocation of funds among the fourcategories above will depend on thenumber and quality of the applicationsreceived. It is anticipated that asubstantial fraction of the funds willsupport continuation of research undercategory 4 above. Typical ESD awardsare $200,000 per year, but range from$50,000 to $750,000. Collaborativeapplications among multipleinvestigators or institutions coveringtwo or more categories are encouraged.Awards are anticipated to begin on orabout July 1, 1994.

The technical portion of theapplication should not exceed twenty-five (25) double-spaced pages. For

6applicants under Category 4 above, the"Accomplishments Under PreviousSupport" section should not exceed ten(10) double-spaced pages. Lengthyappendices are discouraged.

Available from ESD (see ADDRESSESabove) to assist applicants is a copy ofthe CHAMMP Program Plan andsummaries of current research activities.Information about development andsubmissions of applications, eligibility,limitations, evaluation and selectionprocesses, and other policies andprocedures are contained in theApplication Guide for the Office ofEnergy Research Financial Assistance

Program and 10 CFR part 605. TheApplication Guide is available from theU.S. Department of Energy, Office ofHealth and Environmental Research,Environmental Sciences Division, ER-74 (GTN), Washington, DC 20585.Telephone requests may be made bycalling (301) 903-4902.

The Catalog of Federal DomesticAssistance number for this program is81.049.. Issued in Washington, DC, on November30, 1993.D.D. Mayhew,Director, Office of Management, Office ofEnergy Research.[FR Doc. 93-30265 Filed 12-9-93; 8:45 am]BILLING CODE 6450-01-P

Federal Energy RegulatoryCommission[Docket No. ES94-11-000, et al.]

Consolidated Edison Co. of New York,Inc., et al.; Electric Rate, Small PowerProduction, and InterlockingDirectorate Filings

December 6, 1993.Take notice that the following filings

have been made with the Commission:

1. Consolidated Edison Company ofNew York, Inc.[Docket No. ES94-11-O0]

Take notice that on November 30,1993, Consolidated Edison Company ofNew York, Inc. filed an applicationunder § 204 of the Federal Power Actseeking authorization to issue not morethan $300 million of short-term debtduring the period January 1, 1994through December 31, 1995, with a finalmaturity date no later than nine monthsafter date of issuance.

Comment date: December 27, 1993, inaccordance with Standard Paragraph Eat the end of this notice.

2. Duquesne Light Company[Docket No. ES94-10-0001

Take notice that on November 30,1993, Duquesne Light Company filed anapplication under § 204 of the FederalPower Act seeking authorization toissue not more than $325 million ofpromissory notes, commercial paperand other evidences of indebtednessfrom time to time through December 31,1995, with a final maturity date no laterthan December 31, 1996.

Comment date: December 27, 1993, inaccordance with Standard Paragraph Eat the end of this notice.

Standard ParagraphsE. Any person desiring to be heard or

to protest said filing should file a

64938


motion to intervene or protest with theFederal Energy Regulatory Commission,825 North Capitol Street NE,Washington, DC 20426, in accordancewith Rules 211 and 214 of theCommission's Rules of Practice andProcedure (18 CFR 385.211 and 18 CFR385.214). All such motions or protestsshould be filed on or before thecomment date. Protests will beconsidered by the Commission indetermining the appropriate action to betaken, but will not serve to makeprotestants parties to the proceeding.Any person wishing to become a partymust file a motion to intervene. Copiesof this filing are on file with theCommission and are available for publicinspection.Lois D. Cashell,Secretary.[FR Doc. 93-30270 Filed 12-9-93; 8:45 am]BILLING CODE 6717-01-P

[Docket No. CP94-112-000, et al.]

National Fuel Gas Supply Corp., et al.;Natural Gas Certificate Filings

December 6, 1993.Take notice that the following filings

have been made with the Commission:

1. National Fuel Gas SupplyCorporation

[Docket Nos. CP94-112-00 and CP88-94-0081

Take notice that on November 17,1993, National Fuel Gas SupplyCorporation ("National"), 10 LafayetteSquare, Buffalo, New York, 14203, filedamendment to an application pursuantto section 7(c) of the Natural Gas Actand part 157 of the Regulations underthe Natural Gas Act (18 CFR part 157),for a certificate of public convenienceand neeessity authorizing theconstruction, acquisition and operationof facilities in Erie County, New Yorkwhich would satisfy importantoperational concerns raised by Nationalin its previous filings, but atconsiderably less expense thanpreviously proposed. Total cost ofconstructing approximately 1.5 miles ofpipeline and acquiring approximately4.8 miles of pipeline, plus associatedfacilities, is estimated to be $3,772,110.National also requests that theCommission authorize the amendmentof the Transportation Agreementbetween National and Transco EnergyMarketing Corporation by adding anadditional receipt point and anadditional delivery point for thatservice. The details of National'sproposal are more fully set forth in theamended application which is on file

with the Commission and open topublic inspection.

Comment date: December 27, 1993, inaccordance with Standard Paragraph Fat the end of this notice.

2. Tennessee Gas Pipeline Company

[Docket No. CP94-113-000]Take notice that on December 1, 1993,

Tennessee Gas Pipeline Company(Tennessee), P.O. Box 2511, Houston,Texas 77252, filed in Docket No. CP94-113-000 a request pursuant to§§ 157.205 and 157.212 of theCommission's Regulations under theNatural Gas Act (18 CFR 157.205,157.212) for authorization to constructand operate a bi-directionalinterconnect with Columbia GasTransmission Company (Columbia)under Tennessee's blanket certificateissued in Docket No. CP82-413-000pursuant to section 7 of the Natural GasAct, all as more fully set forth in therequest that is on file with theCommission and open to publicinspection.

Tennessee proposes to install, own,and operate a 6-inch hot tap assembly,measurement facility and 3,200 feet of6-inch pipeline to interconnect its Line313A-402 with Columbia's Line A-5.Tennessee states that the facilities willbe located on its line at Mile Post 313A-402+6.04 in Steuben County, New York.Tennessee explains that the facilitieswould be used in performing aninterruptible transportation service forNew York State Electric and Gas.Tennessee indicates that peak andannual equivalent volumes wouldamount to 100,000 dekatherms per dayand 36,500,000 dekatherms,respectively. Tennessee estimates thatthe facilities would cost $599,000 whichwould be reimbursed.

Comment date: January 20, 1994, inaccordance with Standard Paragraph Gat the end of this notice.

3. Natural Gas Pipeline Company ofAmerica[Docket No. CP94-116-0001

Take notice that on December 3, 1993,Natural Gas Pipeline Company ofAmerica (Natural), 701 East 22nd Street,Lombard, Illinois 60148, filed in DocketNo. CP94-116-000 an applicationpursuant to section 7(b) of the NaturalGas Act (NGA) for permission andapproval to abandon a 1,040 H.P.compressor unit in Kankakee County,Illinois, which was authorized in DocketNo. CP66-169 1, all as more fully setforth injhe application which is opento the public for inspection.

1 See order at 35 FPC 828 (1966).

Natural proposes to abandon a 1,040H.P. compressor unit no longer neededat its Herscher storage field in KankakeeCounty, Illinois. Natural states that thecompressor unit has not been used since1984 and is too expensive to operateand maintain. Natural also states that itsabandonment of the compressor unitwould not adversely affect storageinjection or withdrawal rates andcustomer service, nor would overallsystem reliability be jeopardized.Natural further states that it intends tosell the compressor unit uponabandonment.

Comment date: December 27, 1993, inaccordance with Standard Paragraph Fat the end of this notice.

Standard Paragraphs

F. Any person desiring to be heard orto make any protest with reference tosaid application should on or before thecomment date, file with the FederalEnergy Regulatory Commission,Washington, DC 20426, a motion tointervene or a protest in accordancewith the requirements of theCommission's Rules of Practice andProcedure (18 CFR 385.214 or 385.211)and the Regulations under the NaturalGas Act (18 CFR 157.10). All protestsfiled with the Commission will beconsidered by it in determining theappropriate action to be taken but willnot serve to make the protestants partiesto the proceeding. Any person wishingto become a party to a proceeding or toparticipate as a party in any hearingtherein must file a motion to intervenein accordance with the Commission'sRules.

Take further notice that, pursuant tothe authority contained in and subject tothe jurisdiction conferred upon theFederal Energy Regulatory Commissionby sections 7 and 15 of the Natural GasAct and the Commission's Rules ofPractice and Procedure, a hearing willbe held without further notice before theCommission or its designee on thisapplication if no motion to intervene isfiled within the time required herein, ifthe Commission -on its own review ofthe matter finds that a grant of thecertificate and/or permission andapproval for the proposed abandonmentare required by the public convenienceand necessity. If a motion for leave tointervene is timely filed, or if theCommission on its own motion believesthat a formal hearing is required, furthernotice of such hearing will be dulygiven.

Under the procedure herein providedfor, unless otherwise advised, it will beunnecessary for applicant to appear orbe represented at the hearing.

64939

Federal Register I VoL 58, No. 236 / Friday, December 10, 1993 / Notices

G. Any person or the Commission'sstaff may, within 45 days after issuanceof the instant notice by the Commission,file pursuant to Rule 214 of theCommission's Procedural Rules (18 CFR385.214) a motion to intervene or noticeof intervention and pursuant to§ 157.205 of the Regulations under theNatural Gas Act (18 CFR 157.205) aprotest to the request. If no protest isfiled within the time allowed therefor,the proposed activity shall be deemed tobe authorized effective the day after thetime alloived for filing a protest. If aprotest is filed and not withdrawnwithin 30 days after the time allowedfor filing a protest, the instant requestshall be treated as an application forauthorization pursuant to § 7 of theNatural Gas Act.Lois D. Cashell,Secretary.IFR Doec. 93-30216 Filed 12-9-93; 8:45 amlBILLING 0006.9 6tT-01-P

(Docket No. RP94-34-O]

Algonquin Gas Transmission Co.;Proposed Changes In FERC Gas Tariff

December 6,1993.Take notice that on December 1. 1993,

Algonquin Gas Transmission Company(Algonquin) tendered for filing as part ofits FERC Gas Tariff, Fourth RevisedVolume No. 1, the following tariff sheetsto be effective November 1. 1993:

Sub Third Revised Tariff Sheet No. 21Sub Third Revised Tariff Sheet No. 22

Algonquin states that this filingreflects the revised rate of $8.5105 forthe AFT-2 service as approved in theCommission's October 29, 1993 order inDocket No. CP89-661--024. OnSeptember 21, 1993, Algonquin flied anapplication to inter alia, amend itsinitial rates for service under RateSchedule AFT-2 for the periodNovember 1, 1993 to October 31, 1994.The Commission issued its "OrderAmending Certificate" on October 29,1993, granting Algonquin's request.

Algonquin states that copies of thistariff filing were mailed to all customersof Algonquin and interested statecommissions shown on Algonquin'ssystem.

Any person desiring to protest saidfiling should file a protest with theFederal Energy Regulatory Commission,825 North Capitol Street NE.,Washington. DC 20426, in accordancewith § 385.211 of the Commission'sRules and Regulations. All protestsshould he filed on or before December13, 1993. Protests will be considered bythe Commission in determining theappropriate action to be taken, but will

not serve to make protestants parties tothe proceeding. Copies of this filing areon file with the Commission and areavailable for public inspection in thepublic reference room.Lois D. Cashel,Secretary.IFR Doc. 93-30217 Filed 12-9-93; 8:45 am]BILUN CODE SM017-6

-[Docket No. TM94-3-48-40O

ANR Pipeline Co.; Proposed ChangesIn FERC Gas Tariff

December 6, 1993.Take notice that on December 1, 1993,

ANR Pipeline Company (ANR) tenderedfor filing as part of its FERC Gas Tariff,Second Revised Volume No. I tariffsheets as referenced below, proposed tobe effective January 1, 1994:

Third Revised Sheet No. 17First Revised Sheet No. 163First Revised Sheet No. 164First Revised Sheet No. 165

ANR states that the above referencedtariff sheets are being filed to establishthe revised Gas Research Institute (GRI)surcharges in accordance with OpinionNo. 384 issued by the Commission inDocket No. RP93-140 on October 5.1993.

ANR states that copies of the filing isbeing mailed to each of ANR'scustomers and interested statecommissions.

Any person desiring to be heard or toprotest said filing should file a motionto intervene or protest with the FederalEnergy Regulatory Commission, 825North Capitol Street, NE., Washington,DC 20426, in accordance with 18 CFR385.214 and 385.211 of theCommission's Rules and Regulations.All such petitions or protests should befiled on or before December 13, 1993.Protests will be considered by theCommission in determining theappropriate action to be taken, but willnot serve to make protestants parties tothe proceeding. Any person wishing tobecome a party must file a motion tointervene. Copies of this filing are onfile with the Commission and areavailable for public inspection in thepublic reference room.Lois . Cashell,Secretory.IFR Doec. 93-30218 Filed 12-9-93;8, 5 amlBILUNG CODE 6717-01-M

[Docket No. RP94-G-OOO

Black Marlin Pipeline Co.; Petition forWaiver


Black Marlin Pipeline Company (BlackMarlin), tendered for filing a petition forwaiver of certain part 284 reportingrequirements.

Black Marlin requests a waiver of 18CFR 284.106(a) (b) and (d) and 18 CFR284.223 (d)(1), (d)(2), and (d)(4) to theextent necessary to implementtemporary capacity release transactionson Black Marlin's system without filinginitial reports or termination reportsreflecting such temporary capacityrelease transactions.

Black Marlin also requests waiver of18 CFR 284.106(1) (3)(iv), to the extentnecessary to allow Black Marlin to addor delete receipt and delivery pointswithout the filing subsequent reportsunder 18 CFR 284.106(b).

Any person desiring to be heard or tomake any protest with reference to saidfiling should file a petition to interveneor protest with the Federal EnergyRegulatory Commission, 825 NorthCapitol Street NE., Washington, DC20426, in accordance with sections 211and 214 Of the Commission's Rules ofPractice and Procedure, 18 CFR 385.211and 385.214. All such petitions orprotests should be filed on or beforeDecember 13, 1993. Protests will beconsidered by the Commission indetermining the appropriate action to betaken, but will not serve to makeprotestants parties to this proceeding.Any person wishing to become a partymust file a petition to intervene. Copies'of this filing are on file and available forpublic inspection.Lois D. Cashell,Secretary.IFR Doec. 93-30219 Filed 12-9-93; 8:45 amlBILLING CODE 6717-01-M

[Docket No. TM94-2-2--000

Colorado Interstate Gas Co.; ProposedChanges In FERC Gas Tariff


Colorado Interstate Gas Company (CIG)tendered for filing as part of its FERCGas Tariff, First Revised Volume No. 1,Second Revised Sheet No. 11, with aproposed effective date of January 1,1994.

CIG states that the tariff sheet reflectsan increase in the fuel reimbursementpercentage for Lost, Unaccounted-Forand Other Fuel Gas from 0.15% to0.52% effective January 1, 1994.

64940


CIG states that copies of this filinghave been served on CIG's jurisdictionalcustomers andpublic bodies.

Any person desiring to be heard or toprotest said filing should file a motionto intervene or a protest with theFederal Energy Regulatory Commission,825 North Capitol Street NE.,.Washington, DC 20426, in accordancewith §§ 385.211 and 385.214 of theCommission's Rules of Practice andProcedure (18 CFR 385.214 and385.211). All such petitions or protestsshould be filed on or before December13, 1993. Protests will be considered bythe Commission in determining theappropriate action to be taken, but willnot serve to make protestants parties, tothe proceeding. Any person wishing tobecome a party must file a motion tointervene. Copies of this filing are onfile with the Commission and areavailable for public inspection in thepublic reference room.Lois D. Cashell,Secretary.[FR Doc. 93-30220 Filed 12-9-93; 8:45 am]BILLING COoE 6717-01-M

[Docket No. TM94--4-21-O0l

Columbia Gas Transmission Corp.;Proposed Changes In FERC Gas Tariff


Columbia Gas Transmission Corporation(Columbia) tendered for filing as part ofits FERC Gas Tariff, Second RevisedVolume No. 1, the following revisedtariff sheets with a proposed effectivedate of January 1, 1994:

Second Revised Sheet No. 25Second Revised Sheet No. 26Second Revised Sheet No. 27Second Revised Sheet No. 28First Revised Sheet No. 30AFirst Revised Sheet No. 30BFirst Revised Sheet No. 30CFirst Revised Sheet No. 30DColumbia states the aforementioned

tariff sheets are being filed to revise theGas Research Institute (GRI) GeneralRD&D Funding Unit Rates for the year1994, as authorized by Order issued bythe Federal Energy RegulatoryCommission on October 5, 1993, inDocket No. RP93-140-000, OrderingParagraph B. Under the fundingmechanism Columbia will collect theGRI surcharge as follows: (1) Asurcharge of $0.218/Dth included in thereservation charge of firm rate schedulesfor those customers with load factorsexceeding 50%; (2) a surcharge of$0.134/Dth included in the reservationcharge of firm rate schedules for thosecustomers with load factors equal to or

less than 50%; (3) a surcharge of .85v/Dth on the commodity components offirm service rates and one-partinterruptible rates; (4) a surcharge of2.00¢/Dth for service to "smallcustomers" with a GTS serviceagreement and a transportation demandnot exceeding 10,000 Dth/Dayapplicable to one-part small customerservice rates; and (5) a surcharge of1.57€/Dth on firm, one-part rates that donot quality as "small customer" rates.

Columbia states that copies of thefiling were served upon the Company'sjurisdictional customers and interestedstate commissions.

Any person desiring to be heard or toprotest said filing should file a motionto intervene or protest with the FederalEnergy Regulatory Commission, 825North Capitol Street NE., Washington,DC 20426, in accordance with Rules 211and 214 of the Commission's Rules ofPractice and Procedure. All suchmotions or protests should be filed onor before December 13, 1993. Protestswill be considered by the Commissionin determining the appropriate action tobe taken, but will not serve to makeprotestants parties to the proceeding.Any person wishing to become a partymust file a motion to intervene. Copiesof Columbia's filing are on file with theCommission and are available for publicinspection.Lois D. Cashell,Secretary.[FR Doc. 93-30221 Filed 12-9-93; 8:45 am]BILUNG COOE 6717-01-4A

[Docket No. TM94-3-2-O00

East Tennessee Natural Gas Co.;Proposed Changes in FERC Gas Tariff


East Tennessee Natural Gas Company(East Tennessee), tendered for filing aspart of its FERC Gas Tariff, SecondRevised Volume No. 1, First RevisedTariff Sheet No. 4 and First RevisedTariff Sheet Nos. 166 and 167 for aproposed effective date of January 1,1994.

East Tennessee states that this filing isin response to the Commission's orderissued on October 5, 1993, in DocketNo. RP93-140-000, in which theCommission approved the Gas ResearchInstitute's (GRI) 1994 research,development, and demonstrationprogram and related five-year plan, anddirected all jurisdictional members tocollect GRI funding amounts pursuantto the approved 1994 funding. formulaset forth in the Stipulation and

Agreement Concerning Post-1993 GRIFunding Mechanism.

East Tennessee states that copies ofthe filing have been mailed to all of itsjurisdictional customers and affectedstate regulatory commissions.

Any person desiring to be heard or tomake any protest with reference to saidfiling should file a petition to interveneor protest with the Federal EnergyRegulatory Commission, 825 NorthCapitol Street NE., Washington, DC20426, in accordance with sections 211and 214 of the Commission's Rules ofPractice and Procedure, 18 CFR 385.211and 385.214. All such petitions orprotests should be filed on or beforeDecember 13, 1993. Protests will beconsidered by the Commission indetermining the appropriate action to betaken, but will not serve to makeprotestants parties to this proceeding.Any person wishing to become a partymust file a petition to intervene. Copiesof this filing are on file and available forpublic inspection.Lois D. Cashell,Secretary.[FR Doc. 93-30222 Filed 12-9-93; 8:45 am]BILUNG COOE 6717-01-M

(Docket No. TA94-1-23-000, et at.]

Eastern Shore Natural Gas Co.;Technical Conference

December 6, 1993.In the Commission's letter order

issued on November 5, 1993, in theabove-captioned proceedings, theCommission held that the filing raisesissues for which a technical conferenceis to be convened. The conference toaddress the issues has been scheduledfor Tuesday, December 14, 1993, at 1p.m. in a room to be designated at theoffices of the Federal Energy RegulatoryCommission, 825 North Capitol StreetNE., Washington, DC 20426.

All interested persons and staff arepermitted to attend.Lois D. Cashell,Secretary.[FR Dec. 93-30223 Filed 12-9-93; 8:45 am)BILUNG COOE 6717-014A

[Docket No. TM94--09-000]

Kern River Gas Transmission Co.;Proposed Changes In FERC Gas Tariff


Kern River Gas Transmission Company(Kern River), tendered for filing as partof its FERC Gas Tariff, First RevisedVolume No. 1, the following tariff

64941


sheets, with a proposed effective date ofJanuary 1, 1994:

First Revised Sheet No. 5First Revised Sheet No 6First Revised Sheet No. 15First Revised Sheet No. 124First Revised Sheet No. 500Original Sheet No. 50OAFirst Revised Sheet No. 506First Revised Sheet No. 600Original Sheet No. 600AFirst Revised Sheet No. 607First Revised Sheet No. 608First Revised Sheet No. 700Original Sheet No. 700AFirst Revised Sheet No. 710Kern River states that this filing is in

response to the Commission's orderissued on October 5, 1993, in DocketNo. RP93-140-000, in which theCommission approved the Gas ResearchInstitutes (GRI) 1994 research,development, and demonstrationprogram and related five-year plan, anddirected all jurisdictional members tocollect GRI funding amounts pursuantto the approved 1994 funding formulaset forth in the Stipulation andAgreement Concerning Post-1993 GRIFunding Mechanism.

Kern River states that copies of thefiling have been mailed to all of itsJurisdictional customers and affectedstate regulatory commissions.

Any person desiring to be heard or tomake any protest with reference to saidfiling should file a petition to interveneor protest with the Federal EnergyRegulatory Commission, 825 NorthCapitol Street NE., Washington, DC20426, in accordance with sections 211and 214 of the Commission's Rules ofPractice and Procedure, 18 CFR 385.211and 385.214. All such petitions orprotests should be filed on or beforeDecember 13, 1993. Protests will beconsidered by the Commission indetermining the appropriate action to betaken, but will not serve to makeprotestants parties to this proceeding.Any person wishing to become a partymuft file a petition to intervene. Copiesof this filing are on file and available forpublic inspection.Lois D. Cashell,Secretary.[FR Doc. 93-30224 Filed 12-9-93; 8:45 amlBRIM CODE 671-01-N

[Docket No. TM94-1-63-000]

K N Interstat Gas Transmission Co.;Proposed Changes In FERC Gas Tariff

December 6,1993.Take notice that on December 1,1993,

K N Interstate Gas Transmission Co.(KNI), tendered for filing as part of itsFERC Gas Tariff, Second Revised

Volume No. 1-A, Second Revised SheetNo. 4-D, with a proposed effective dateof January 1, 1994.

KNI states that the proposed changeswill adjust KNI's rates charged itsjurisdictional customers pursuant to theGas Research Institute chargeadjustment provision (Section 21) ofKNI's FERC Gas Tariff, Second RevisedVolume No. 1-B. Such adjustment is totrack the revised GRI fundingmechanism, effective January 1, 1994,per Commission Opinion No. 384 datedOctober 5,1993, in Docket No. RP93-140-000.

KNI states that copies of this filingwere served upon KNI's jurisdictionalcustomers, and interested public bodies.

Any person desiring to be heard or toprotest said filing should file a motionto intervene or a protest with theFederal Energy Regulatory Commission,825 North Capitol Street NE..Washington, DC 20426, in accordancewith 18 CFR 385.214 and 385.211 of theCommission's Rules and Regulations.All such motions or protests should befiled on or before December 13, 1993.Protests will be considered by theCommission in determining theappropriate action to be taken, but willnot serve to make protestants parties tothe proceeding. Any person wishing tobecome a party must file a motion tointervene. Copies of this filing are onfile with the Commission and areavailable for public inspection in thepublic reference room.Lois D. Cashell,Secretary.[FR Doec. 93-30225 Filed 12-9-93; 8:45 am]BILUNG CODE 6717-01-M

[Docket No. TM94-3-6-0OO1

Midwestern Gas Transmission Co.;Proposed Changes In FERC Gas Tariff


Midwestern Gas Transmission Company(Midwestern), tendered for filing as partof its FERC Gas Tariff, Second RevisedVolume No. 1, Second Revised TariffSheet No. 5 and First Revised TariffSheet Nos. 82 and 83 for a proposedeffective date of January 1, 1994.

Midwestern states that this filing is inresponse to the Commission's orderissued on October 5, 1993, in DocketNo. RP93-140-000, in which theCommission approved the Gas ResearchInstitute's (GRI) 1994 research,development, and demonstrationprogram and related five-year plan, anddirected all jurisdictional members tocollect GRI funding amounts pursuantto the approved 1994 funding formula

set forth in the Stipulation andAgreement Concerning Post-1993 GRIFunding Mechanism.

Midwestern states that copies of thefiling have been mailed to all of itsjurisdictional customers and affectedstate regulatory commissions.

Any person desiring to be heard or tomake any protest with reference to saidfiling should file a petition to interveneor protest with the Federal EnergyRegulatory Commission, 825 NorthCapitol Street NE., Washington, DC20426, in accordance with Sections 211and 214 of the Commission's Rules ofPractice and Procedure, 18 CFR 385.211and 385.214. All such petitions orprotests should be filed on or beforeDecember 13, 1993. Protests will beconsidered by the Commission indetermining the appropriate action to betaken, but will not serve to makeprotestants parties to this proceeding.Any person wishing to become a partymust file a petition to intervene. Copiesof this filing are on file and available forpublic inspection.Lois D. Cashell,-Secretary.[FR Doc. 93-30226 Filed 12--9-g3; 8:45 amlBILUNG CODE 6717-01-M

[Docket No. TM94-1-02-0001

Mojave Pipeline Co.; ProposedChanges in FERC Gas Tariff


Mojave Pipeline Company (Mojave)tendered for filing as part of its FERCGas Tariff, First Revised Volume No. 1,First Revised Sheet Nos. 11 and 126,with a proposed effective date ofJanuary 1, 1994.

Mojave states that these sheets arebeing revised in order to implement thenew GRI rates approved by theCommission.

Mojave states that copies of this filingwere served upon all of Mojave'sjurisdictional transportation customers.

Any person desiring to be heard toprotest said filing should file a motionto intervene or protest with the FederalEnergy Regulatory Commission, 825North Capitol Street, NE., Washington,DC 20426, in accordance with§§ 385.214 and 385.211 of theCommission's Rules and Regulations.All such motions or protests should befiled on or before December 13, 1993.Protests will be considered by theCommission in determining theappropriate action to be taken but willnot serve to make protestants parties tothe proceeding. Copies of this filing areon file with the Commission and are

64942


available for public inspection in thepublic reference room.Lois R CaSkellSecretary.IFR Doc. 93-30227 Filed 12-9-03; 8:45 amnBILLNG COD E61-t-.M

[Docket No. TU94-2-37-000]

Northwest Pipeline Corp.; ProposedChanges In FERC Gas Tariff

December 6, 1993.Take notice that on December 1,1993,

Northwest Pipeline Corporation(Northwest) tendered for filing andacceptance the following tariff sheets:Third Revised Volume No. 1

First Revised Sheet No. 5First Revised Sheet No. 5-AOriginal Sheet No. 5-BFirst Revised Sheet No. 8First Revised Sheet No. 18First Revised Sheet No. 225

Orginal Volume No. 2Thirty-Fourth Revised Sheet No. 2.3Northwest states that the purpose of

this filing is to update its CommoditySSP Surcharge effective January 1, 1994,to reflect (1) interest applicable toOctober, November and December 1993,and (2) the amortization of principaland interest. The proposed CommoditySSP Charge contained in this instantfilling is 4.06C per MMBtu for the threemonths commencing January 1, 1994. Afurther purpose of this filing is toupdate Northwest's tariff to reflect thecurrent Commission approvedcommodity and demand GRI surchargesto be effective for the twelve monthscommencing January 1, 1994. The GRIad4ustment demand surcharge, as setforth on Sheet No. 5, is 21.800 perMMBtu for Rate Schedule TF-1 (LargeCustomer) high load factor customersand 13.400 per MMBtu for RateSchedule TF-1 (Large Customer) lowload factor customers. The commoditysurcharge is .850 per MMBtu, except inthe case of the Rate Schedule TF-1(Small Customer), which is 2.000 perMMBtu. Some technical changesapplicable to certain GRI provisionpages have also been made.

Northwest states that a copy of thisfiling has been served upon alljurisdictional customers and stateregulatory commissions in its marketarea.

Any person desiring to be heard orprotest said filing should file a motionto intervene of protest with the Federal -

Energy Regulatory Commission, 825North Capitol Street NE., Washington,DC 20426, in accordance with§§385.214 and 385.211 of the

Commission's Rules of Practice andProcedure. All such motions or protestsshould be filed on or before December13, 1993. Protests will be considered bythe Commission determining theappropriate action to be taken, but willnot serve to make protestants parties tothe proceeding. Any person wishing tobecome a party must file a motion tointervene. Copies of this filing are onfile with the Commission and areavailable for public inspection in thepublic reference room.Lois D. Cashell,Secretary.iFR Doc. 93-30228 Filed 12-9-93; 8:45 am]BILUNG CODE 6717-01-A

[Docket No. TM94-2-86-0001Pacific Gas Transmission Co.;Proposed Changes in FERC Gas Tariff

December 6, 1993.

Take notice that on December 2, 1993,Pacific Gas Transmission Company(PGT) tendered for filing as part of itsFERC Gas Tariff, First Revised VolumeNo. 1-A and Second Revised VolumeNo. i proposed tariff sheets listed on theAppendix to the filing, to be effectiveJanuary 1, 1994.

PGT states the purpose of this filingis to revise the Gas Research Institute's(GRI) funding unit adjustmentcomponent for certain transportationservices effective January 1, 1994, inaccordance with the Commission'sMarch 22, 1993, and June 23, 1993orders in Docket No. RP92-133-000 andits October 5, 1993 order in Docket No.RP93-140-000.

PGT further states that copies of itsfiling were served on all jurisdictionalcustomers and interested stateregulatory agencies.

Any person desiring to be heard orprotest said filing should file a motionto intervene or protest with the FederalEnergy Regulatory Commission, 825North Capitol Street NE.. Washington,DC 20426, in accordance with§§ 385.214 and 385.211 of theCommission's Rules ofPractice andProcedure. All such motions or protestsshould be filed on or before December13, 1993. Protests will be considered bythe Commission in determining theappropriate action to be taken, but willnot serve to make protestants parties tothe proceeding. Any person wishing tobecome a party must file a motion tointervene. Copies of this filing are on

file with the Commission and areavailable for public inspection.Lois D.CashelLSecretary.[FR Doc. 93-30229 Filed 12-9-43; 8:45 an]I.UNG c01 all-41-M

[Docket No. TM94-2--O.O0Tennessee Gas Pipeline Co.; ProposedChanges in FERC Gas Tariff

December 6, 1993.

Take notice that on December 1, 1993,Tennessee Gas Pipeline Company(Tennessee), tendered for filing as partof its FERGOGas Tariff, Fifth RevisedVolume No. 1, Third Revised TariffSheet No. 30 and First Revised TariffSheet Nos. 384 and 385 with a proposedeffective date of January 1, 1994.

Tennessee states that this filing is inresponse to the Commission's orderissued on October 5,1993, in DocketNo. RP93-140--O00, in which theCommission approved the Gas ResearchInstitute's (GRI) 1994 research,development, and demonstrationprogram and related five-year plan, anddirected all jurisdictional members tocollect GRI funding amounts pursuantto the approved 1,994 funding formulaset forth in the Stipulation andAgreement Concerning Post-1993 GRIFunding Mechanism.

Tennessee states that copies of thefiling have been mailed to all of itsjurisdictional customers and affectedstate regulatory commissions.

Any person desiring to be heard or tomake any protest with reference to saidfiling should file a petition to interveneor protest with the Federal EnergyRegulatory Commission, 825 NorthCapitol Street, NE., Washington, DC20426, in accordance with sections 211and 214 of the Commission's Rules ofPractice and Procedure, 18 CFR 385.211and 385.214. All such petitions orprotests should be filed on or beforeDecember 13, 1993. Protests will beconsidered by the Commission indetermining the appropriate action to betaken, but Will not serve to makeprotestants parties to this proceeding.Any person wishing to become a partymust file a petition to intervene. Copiesof this filing are on file and available forpublic inspection.Lois D. Cashell,Secretary.[FR Dec. 93-30230 Filed 12-9-93; 8:45 amjBILUNG COO 6717-01-A

64943


[Docket No. GT94-12-000

Transcontinental Gas Pipe Line Corp.;Proposed Changes in FERC Gas Tariff


Transcontinental Gas Pipe LineCorporation (TGPL) tendered for filingas part of its FERC Gas Tariff, ThirdRevised Volume No. 1 and OriginalVolume No. 2, certain revised tariffsheets included in Appendix A attachedto the filing. The proposed effective dateof such tariff sheets is January 1, 1994.

TGPL states that the purpose of theinstant filing is to terminate section 7(c)firm transportation service under RateSchedules X-265, X-266, X-272 and X-273 and to convert such service toservice provided under Rate ScheduleFT and Part 284 of the Commission'sregulations effective January 1, 1994.The rates applicable to the convertedservice are the generally applicablecharges under Rate Schedule FT(including fuel), plus the reservationand commodity rate surcharges set forthon Sheet No. 40A to TGPL's ThirdRevised Volume No. 1 Tariff. Sheet No.40A sets forth surcharges applicable toIncremental Leidy Line Annual FirmTransportation which has beenconverted from section 7(c) firmtransportation service to service underpart 284 of the Commission'sregulations. Calculations supporting thesurcharge levels at January 1, 1994, areset forth in Appendix B attached to thefiling.

TGPL states that copies of the filingare being mailed to BUG, New JerseyNatural and interested StateCommissions.

Any person desiring to be heard or toprotest said filing should file a motionto intervene or protest with the FederalEnergy Regulatory Commission, 825North Capitol Street, NE., Washington,DC 20426, in accordance with§§ 385.214 and 385.211 of theCommission's Rules and Regulations.All such motions-or protests should befiled on or before December 13, 1993.Protests will be considered by theCommission in .determining theappropriate action to be taken, but willnot serve to make protestants parties tothe proceeding. Any person wishing tobecome a party must file a motion tointervene. Copies of this filing are onfile with the Commission and areavailable for public inspection in thepublic reference room.Lois D; Cashell,Secretary.[FR Doc. 93-30231 Filed 12-9-93; 8:45 am]BILUNG CODE 6717-01-M

[Docket No. RP94-75-00]

Transcontinental Gas Pipe Line Corp.;Proposed Changes in FERC Gas Tariff


Transcontinental Gas Pipe LineCorporation (TGPL) tendered for filingas part of its FERC Gas Tariff, ThirdRevised Volume No. 1, certain originaltariff sheets included in Appendix Aattached to the filing, with a proposedeffective date of January 1, 1994.

TGPL states that the purpose of theinstant filing is to implement TGPL'sOrder No. 636 Blanket Sales Certificateunder subpart J of the Commission'spart 284 regulations. TGPL states thatsuch tariff sheets comprise TGPL's newRate Schedule NS, and a Form ofService Agreement for servicethereunder. TGPL states that RateSchedule NS provides for fullynegotiated terms, and is intended tocover all gas sales made by TGPLoutside its existing sales service rateschedules.

TGPL states that it is serving copies ofthe instant filing to its customers, StateCommissions and other interestedparties.

Any person desiring to be heard or toprotest said filing should file a motionto intervene or protest with the FederalEnergy Regulatory Commission, 825North Capitol Street NE., Washington,DC 20426, in accordance with§§ 385.214 and 385.211 of theCommission's Rules and Regulations.All such motions or protests should befiled on or before December 13, 1993.Protests will be considered by theCommission in determining theappropriate action to be taken, but willnot serve to make protestants parties tothe proceeding. Any person wishing tobecome a party must file a motion tointervene. Copies of this filing are onfile with the Commission and areavailable for public inspection in thepublic reference room.Lois D. Cashell,Secretary.[FR Doc. 93-30232 Filed 12-9-93; 8:45 am]BILUNG CODE 6717-01-M

[Docket No. T094-1-35-000]

West Texas Gas, Inc.; ProposedChanges in FERC Gas Tariff

December 6, 1993.Takenotice that on December 1, 1993,

West Texas Gas, Inc. (WTG) tendered forfiling as part of its FERC Gas Tariff,Revised Volume No. 1, Ninth RevisedSheet No. 4, with a proposed effectivedate of January 1, 1994.

WTG states that Ninth Revised SheetNo. 4 and the accompanyingexplanatory schedules constitute WTG'squarterly PGA filing submitted inaccordance with the Commission'spurchased gas adjustments regulations.

WTG states that copies of the filingwere served upon WTG's customers andinterested state commissions.

Any persons desiring to be heard orto protest said filing should file amotion to intervene or protest with theFederal Energy Regulatory Commission,825 North Capitol Street NE.,Washington, DC 20426, in accordancewith Rules 211 and 214 of theCommission's Rules of Practice andProcedure, 18 CFR 385.211 and 385.214.All such motions or protests should befiled on or before December 13, 1993.Protests will be considered by theCommission in determining theappropriate action to be taken, but willnot serve to make the protestants partiesto the proceeding. Any person wishingto become a party must file a motion tointervene. Copies of this filing are onfile with the Commission and areavailable for public inspection.Lois D. Cashell,Secretary.[FR Doc. 93-30233 Filed 12-9-93; 8:45 am]BILUNG CODE 6717-01-

[Docket No. TM94-2-43-0o0]

Williams Natural Gas Co.; ProposedChanges in FERC Gas Tariff


Williams Natural Gas Company (WNG)tendered for filing as part of its FERCGas Tariff, Second Revised Volume No.1, Second Revised Sheet Nos. 6 and 6A,with a proposed effective date of.January 1, 1994.

WNG states that this filing is beingmade to reflect the new GRI surchargesto be collected on nondiscountedtransportation services, as approved byCommission order issued October 5,1993, in Docket No. RP93-140-000.

WNG statis that it entered into allnew contracts as of October 1, 1993, inconnection with its restructuring underOrder No. 636, and therefore has nohistory to calculate customer loadfactors using the GRI formula. Inaddition, virtually all of WNG's salesprior to restructuring were made underits full requirements rate schedulewhich had no specified contractdemand level. Therefore, WNG submitsthat the only fair way to assign loadfactors is to assume every customer islow load factor for purposes of the GRIcalculation. For the calendar year 1995,

64944


WNG will have history to determineactual load factors. As WNG will haveno high load factor demand, to avoidconfusion it has omitted the high loadfactor demand rate from its tariff.

WNG states that a copy of its filingwas served on all jurisdictionalcustomers and interested statecommissions.

Any person desiring to be heard or toprotest said filing should file a motionto intervene or a protest with theFederal Energy Regulatory Commission,825 North Capitol Street, NE.,Washington, IDC 20426, in accordancewith §§ 385.214 and 385.211 of theCommission's Rules and Regulations.All such motions or protests should befiled on or before December 13, 1993.Protests will be considered by theCommission in determining theappropriate action to be taken, but willnot serve to make protestants parties tothe proceeding. Any person wishing tobecome a party must file a motion tointervene. Copies of this filing are onfile with the Commission and areavailable for public inspection in thepublic reference room.Lois D. Cashell,Secretary.[FR Dec..93-30234 Filed 12-9-93; 8:45 am]BILLING COOE 6717-01-M

ENVIRONMENTAL PROTECTION

AGENCY

[ER-FRL-4705-Ol

Intent To Prepare an EnvironmentalImpact Statsment (EIS) on theProposed Eagle Pass Mine

AGENCY: U.S. Environmental ProtectionAgency (EPA).ACTION: Proposed issuance of a "NewSource" National Pollutant DischargeElimination System (NPDES) permit forthe discharge of waste water from theDos Republicas Resources Company,Inc.'s (DRRC) proposed miningoperation in Maverick County, Texas.

PtPOSME: To evaluate the potentialsignificant impacts on the environmentwhich may result from the EPA'sproposed action, pursuant to~theNational Environmental Policy Act(NEPA).SUMMARY: The DRRC has applied to theEPA for a NPDES permit to dischargewaste waters from its Eagle Pass Mineinto Elm Creek. The EPA determinedthe proposed project to be a majorFederal action which could significantlyaffect the quality of the humanenvironment. The proposed mineincludes approximately 5,900 acres over

the 19-year life of the project and anestimated 39,231,000 tons of coal willbe excavated.ALTERNATIVES: The EPA may issue ordeny the new source NPDES permit.

SCOPIN : The EPA will hold a scopingmeeting at St. Joseph's Parish Hall inEagle Pass, Texas on Tuesday, January18, 1994, at 7 p.m. for the purpose ofidentifying areas to be evaluated in theDraft EIS.FOR FURTkER NFORMATION OR TO BEPLACED ON THE EIS MAILING UST: ContactMr. Norm Thomas, Chief FederalActivities Branch, EPA Region 6(E-F),1445 Ross Avenue, Dallas, Texas 75202-2733; telephone 214-655-2260.

ESTIMATED RELEASE DATE OF DRAFT EIS:March, 1994.

RESPONSIBLE OFFCIA.: Joe D. Winkle,Acting Regional Administrator.Richard Sanderson,Director, Office of Federal Activities.IFR Dc. 93-30056 Filed 12-9-93; 8:45 am]BILLING COME 6804-

[ER-FRL-4706-4]

Environmental Impact Statements andRegulations; Availability of EPAComments

Availability of EPA commentsprepared November 15, 1993 ThroughNovember 19, 1993 pursuant to theEnvironmental Review Process (ERP),under section 309 of the Clean Air Actand section 102(2)(c) of the NationalEnvironmental Policy Act as amended.Requests for copies of EPA commentscan be directed to the Office of Federal'Activities at (202) 260-5076.

An explanation of the ratings assignedto draft environmental impactstatements (EISs) was published in FRdated April 10, 1993 158 FR 18392).

Draft EISs

ERP No. D-USN-El1031-NC RatingEC2, Camp Lejeune Marine Corps Base,Disposal of Non-Hazardous Solid WasteProject, Implementation, COE section404 and NPDES Permits, OnslowCounty, NC.

Summary: EPA expressedenvironmental concerns with theproposed landfill construction andwaste minimizationt recycling effort canhave a positive long-term impact onsurface and groundwater quality atCamp Lejeune compared to the existingfacility. There are potentialenvironmental concerns associated withthis action which reouire additionalinformation.

Final EISs

ERP No. F-AFS--L65184-OR, 1991Warner Creek Fire Recovery Project,Northern Spotted Owl Habitat andOther Resources Reforestation, NorthernSpotted Owl Habitat Conservation Area0-10, Willamette National Forest,Oakridge Ranger District, Lane County,OR.

Summary: EPA had no objection tothe proposed action.

Dated: December 6, 1993.William D. Dickerson,Deputy Director, Office of Federal Activities.[FR Doc. 93-30314 Filed 12-9--93; 8:45 am]BILUNG CODE 656a4"

[ER-FRL-4706--]

Environmental Impact Statements;Notice of Availability

Responsible Agency: Office of FederalActivities, General Iformation (202)260-5076 OR 1202.) 260-5075. Weeklyreceipt of Environmental ImpactStatements Filed November 29, 1993Through December 3, 1993 Pursuant to40 CFR 1506.9.EIS No. 930429, Final EIS, COE, PR, Rio

Grande de Arecibo Basin, FloodControl Plan, Implementation,Arecibo River, City of Arecibo, PR,Due: January 10,1994, Contact:Barbara Cintron (904) 223-1692.

EIS No. 930430, Draft EtS, BLM, CA,Clear Creek Management Area, Landand Resource Management PlanAmendment, Implementation, SanBenito and Fresno Counties, CA, Due:February 15, 1994, Contact: TimMoore (408) 637-8183.

EIS No. 930431, Draft EIS, AFS, ID,Jenkins Timber Sale, HarvestingTimber and Road Construction,Payette National Forest, NewMeadows Ranger District, Idaho andAdams Counties, ID, Due: January 28,1994, Contact: Mike Balboni (2G8)634-0629.

EIS No. 930432, Draft EIS, AFS, ID,Hazard Helicopter Timber Sale,Harvesting Timber and RoadConstruction, Payette National Forest,New Meadows Ranger District, IdahoCounty, ID, Due: January 28, 1994,Contact: Mike Balboni (208) 634-0629.

EIS No. 930433, Draft EIS, UAF, CO,.Lowry Air Force Base (AFB) Disposaland Reuse, Implementation, DenverCounty, CO, Due: January 24. 1994,Contact: Gary Baumgartel (210) 536-3869.

EIS.No. 930434, Final EIS, AFS., ID,Spruce Creek Timber Sale,Implementation, Boise National

-64945


Forest, Valley County, ID, Due:January 10, 1994, Contact: RonnJulian (208) 382-4271.

EIS No. 930435, Draft EIS, AFS, TN,1996 Olympic Whitewater SlalomVenue, Construction and Operation,Site Selected, Ocoee River, CherokeeNational Forest, Ocoee RangerDistrict, Polk County, TN, Due:January 24, 1994, Contact: KeithSandifer (615) 476-9700.

EIS No. 930436, Final Supplement,NOA, MA, ME, RI, NH, CT, NortheastMulti-Species Fishery ManagementPlan, Updated Information,Amendment 5, Implementation, Gulfof Maine, Georges Bank ME, NH, CT,RI and MA, Due: January 5, 1994,Contact: Rolland A. Schmitten (301)713-2239. In accordance with1502.9(c)(4) of the Council onEnvironmental Quality (CEOJRegulations for implementing theprocedural provisions of the NationalEnvironmental Policy Act alternativeprocedures have been approved bythe Council for the filing of this FSEISto reduce the comment period by 5days. For further information contactElisabeth Blaug, (CEQ) Phone No.202-395-5754.

EIS No. 930437, Draft Supplement, AFS,CA, Bear Mountain Ski ResortExpansion, (formerly known asGoldmine) Additional Information,San Bernandino National Forest,Special-Use-Permit and Possible COESection 404 Permit, San BernandinoCounty, CA, Due: January 31, 1994,Contact: Hal Seyden (714) 250-5555.

EIS No. 930438, Draft EIS, FHW, NC,NC-12 Replacement of Herbert C.Bonner Bridge (Bridge No. 11) overOregon Inlet, Construction, Funding,Coast Guard Bridge Permit, Special-Use-Permit, Right-of-Way Permit, COESection 10 and 404 Permits, DareCounty, NC, Due: January 31, 1994,Contact: Nicholas L. Graf, P.E. (919)856-4346.

Dated: December 8, 1993.C. Marshall Cain,Senior Legal Avisor, Office of FederalActivities.[FR Doc. 93-30315 Filed 12-9--93; 8:45 am]BILUNG CODE 6560-60-U

FEDERAL EMERGENCY

MANAGEMENT AGENCY

[FEMA-1006-DR]

Missouri; Major Disaster and RelatedDeterminations .

AGENCY: lederal EmergencyManagement Agency (FEMA).ACTION: Notice.

SUMMARY: This is a notice of thePresidential declaration of a majordisaster for the State-of Missouri(FEMA-1006-DR), dated December 1,1993, and related determinations.

EFFECTIVE DATE: December 1, 1993.

FOR FURTHER INFORMATION CONTACT:Pauline C. Campbell, Response andRecovery Directorate, FederalEmergency Management Agency,Washington, DC 20472, (202) 646-3606.

SUPPLEMENTARY INFORMATION: Notice ishereby given that, in a letter datedDecember 1, 1993, the Presidentdeclared a major disaster under theauthority of the Robert T. StaffordDisaster Relief and EmergencyAssistance Act (42 U.S.C. 5121 et seq.),as follows:

I have determined that the damage incertain areas of the State of Missouri,resulting from severe storms, tornadoes, andflooding on November 13-19, 1993, is ofsufficient severity and magnitude to warranta major disaster declaration under the RobertT. Stafford Disaster Relief and EmergencyAssistance Act ("the Stafford Act"). I,therefore, declare that such a major disasterexists in the State of Missouri.

In order to provide Federal assistance, youare hereby authorized to allocate from fundsavailable for these purposes, such amounts asyou find necessary for Federal disasterassistance and administrative expenses.

You are authorized to provide IndividualAssistance in the designated areas. PublicAssistance may be added at a later date, ifrequested and warranted. Consistent with therequirement that Federal assistance besupplemental, any Federal funds providedunder the Stafford Act for Public Assistancewill be limited to 75 percent of the totaleligible costs.

The time period prescribed for theimplementation of section 310(a),Priority to Certain Applications forPublic Facility and Public HousingAssistance, 42 U.S.C. 5153, shall be fora period not to exceed six months afterthe date of this declaration.

Notice is hereby given that pursuantto the authority vested in the Director ofthe Federal Emergency ManagementAgency under Executive Order 12148, Ihereby appoint Warren M. Pugh, Jr., ofthe Federal Emergency ManagementAgency to act as the FederalCoordinating Officer for this declareddisaster.

I do hereby determine the followingareas of the State of Missouri to havebeen affected adversely by this declaredmajor disaster: Bollinger, CapeGirardeau, Carter, Howell, Iron,Jefferson, Madison, Oregon, Reynolds,Ripley, St. Francois, St. Louis, Shannon,and Wayne Counties for IndividualAssistance.

(Catalog of Federal Domestic Assistance No.83.516, Disaster Assistance)James Lee Witt,Director.[FR Doc. 93-30205 Filed 12-9-93; 8:45 am]BILLING CODE 6718-02-M

[FEMA-3113-EM]

Texas; Amendment to Notice of anEmergency Declaration

AGENCY: Federal EmergencyManagement Agency (FEMA).ACTION: Notice.

SUMMARY: This notice amends the noticeof an emergency for the State of Texas(FEMA-3113-EM), dated September 10,1993, and related determinations.EFFECTIVE DATE: December 1, 1993.FOR FURTHER INFORMATION CONTACT:Pauline C. Campbell, Response andRecovery Directorate, FederalEmergency Management Agency,Washington, DC 20472, (202) 646-3606.SUPPLEMENTARY INFORMATION: Notice ishereby given that the incident period forthis disaster is closed effectiveNovember 15.(Catalog of Federal Domestic Assistance No.83.516, Disaster Assistance)Richard W. Krimm,Associate Director, Response and RecoveryDirectorate.[FR Doc. 93-30206 Filed 12-9-93; 8:45 am]BILUNG CODE 6718-02-M

FEDERAL MARITIME COMMISSION

Ocean Freight Forwarder License;Applicants

Notice is hereby given that thefollowing applicants have filed with theFederal Maritime Commissionapplications for licenses as ocean freightforwarders pursuant to section 19 of theShipping Act of 1984 (46 U.S.C. app.1718 46 CFR part 510).

Persons knowing of any reason whyany of the following applicants shouldnot receive a license are requested tocontact the Office of Freight Forwarders,Federal Maritime Commission,Washington, DC 20573.Ocean Freight Express

2644 West Pico Blvd., Los Angeles, CA90006

Jorge L. Rojas, Sole ProprietorIntracon Incorporated

811 Banyan Drive, Elk Grove Village, IL60007

Officers: Juergen Stoffel, President; RenateDaugill-Stoffel, Vice President/Secretary

Unlimited Freight Consultants, Inc.7845C NW 57th Street, Miami, FL 33166

64946


Officer: Marcos A. Niebla, PresidentTommy C. May, Inc. dba Tommy C. May,

CHBP.O. Box 5067, Pasadena, TX 77508-5067Officers: Tommy C. May, President; Mrs.

Joe A. May, Vice President; Catalina H.Irwin, Secretary/Treasurer

International Transportation Experts, Limited1801-H Crossbeam Drive, Charlotte, NC

28217Officers: Klaus Hesse, President; Doris

Larkin, Vice President; Joyce Therrell,Secretary

SCL Shipping (USA) Inc.150-30 132nd Ave., #208, Jamaica, NY

11434Officers: Derek Chan, President; Dennis

Choy, Vice President/Treasurer; CarolChan, Secretary/Director

William (Bill) J. Donovan16, 120 Vanderbilt Drive, Odessa, FL 33556Sole Proprietor

Freight Brokers International, Inc.1235 North Loop West, Suite 601, Houston,

TX 77008Officers: Allan B. Appelbaum, President;

Linda G. Appelbaum, SecretaryElaine Forwarding

4311 East Alderdale Avenue, Anaheim, CA92807

Takao Murooka, Sole ProprietorNora Jarvis

16,674 Spruce Circle, Fountain Valley, CA92708

Nora Akemi Jarvis, Sole ProprietorGraebel Logistics International in association

with Creebel/Houston Movers, Inc.10901 Tanmer Road, Houston, TX 77041-

7105Officer: A. Robert Kral, Vice President/

General ManagerCentral Forwarding Inc.

1600 West Loop 340, Waco, TX 76702-0817

Officers: James H. Alexander, President;Shawn M. Putnam, Vice President;Phillip L Hering, Secretary; Barron W.Cagle, Director; Frank A.. Espinola,Director; Randy L. Berry, Director

H.K. Forwarding Company2039 West Artesia Blvd., #144, Torrance,

CA 90504Heywal S. Kahng, Sole Proprietor

Arrow Freight Services Inc.2479 NW., 36th Street, Miami, FL 33142Rene 1. Carrasco, President/Director/

Stockholder, Antonio Leal, VicePresident/Director/Stockholder; LourdesM. Herrera, Secretary/Director/Stockholder

B.L.G. Air-Ocean Transport Corporation9601 N.W. 12th Street, Miami, FL 33172Officers: Pedro A. Govea, President/

Stockholder; Dagmar Herran, VicePresident; Juan A. Alvarez, Secretary/Stockholder

Dated: December 7, 1993.By the Federal Maritime Commission.

Joseph C. Polking,Secretary.[FR Doc. 93-30214 Filed 12-9-93; 8:45 am]BILUNG CODE 6730-01-M

[Petition Nos. P102-03, P103-03, P104-03]

Hoegh Lines, et al.; Petition forTemporary Exemption From ElectronicTariff Filing Requirements

In the matter of Petition of Hoegh Lines,Petition of Independent Container Line Ltd.,Petition of P&O Containers Limited.

Notice is hereby given of the filing ofpetitions by the above namedpetitioners, pursuant to 46 CFR 514.8(a),for temporary exemption fromelectronic, tariff filing requirements ofthe Commission's ATFI System. Tofacilitate thorough consideration of thepetitions, interested persons arerequested to reply to the petitions nolater than December 15, 1993. Repliesshall be directed to the Secretary,Federal Maritime Commission,Washington, DC 20573-0001, shallconsist of an original and 15 copies, andshall be served as follows:P102-93-Wayne R. Rohde, Esq., Sher &

Blackwell, 1255 Twenty-third Street,NW., Suite 500, Washington, DC20037-1194

P103-93--George A. Quadrino, Esq.,Warren & Associates, P.C., 1100Connecticut Avenue, NW.,Washington, DC 20036

P104-93-Paul D. Coleman, Esq.,Hoppel, Mayer & Coleman, 1000Connecticut Avenue, NW.,Washington, DC 20036Copies of the petitions are available

for examination at the Washington, DCoffice of.the Secretary of theCommission, 800 N. Capitol Street,NW., room 1046.Joseph C. Polking,Secretary.[FR Doc. 93-30164 Filed 12-9-93; 8:45 am]

BILUNG CODE 6730-01-M

FEDERAL RESERVE SYSTEM

Federal Open Market Committee;Domestic Policy Directive ofSeptember 21, 1993

In accordance with § 271.5 of its rulesregarding availability of information (12CFR part 271), there is set forth belowthe domestic policy directive issued bythe Federal Open Market Committee atits meeting held on September 21,1993.1 The directive was issued to the

I Copies of the Minutes of the Federal OpenMarket Committee Meeting of September 21, 1993,which include the domestic policy directive issuedat that meeting, are available upon request to theBoard of Governors of the Federal Reserve System.Washington, D.C. 20551. The minutes are publishedin the Federal Reserve Bulletin and in the Board'sannual report.

Federal Reserve Bank of New York asfollows:

The information reviewed at this meetingsuggests that economic activity is continuingto expand at a moderate pace. Total nonfarmpayroll employment edged down in August

-after a sizable gain in July, but the averageworkweek rose to a relatively high level andthe civilian unemployment rate declined to6.7 percent. Industrial production hasadvanced moderately over recent months.Retail sales changed little in real terms inJuly and August after increasing appreciablyin the second quarter. Housing starts weredown slightly in July but rose substantiallyin August. Available indicators suggest aslowing in the expansion of business capitalspending from a robust pace earlier in theyear. The nominal U.S. merchandise tradedeficit was about unchanged in July from itsaverage rate in the second quarter. Afterrising at an accelerated rate in the early partof the year, consumer prices have increasedmore slowly and producer prices have fallenin recent months.

Short-term interest rates have changedlittle since the Committee meeting on August17, while yields on intermediate- and long-'term debt obligations have declinedsomewhat. In foreign exchange markets, thetrade-weighted value of the dollar in terms ofthe other G-10 currencies depreciatedsubstantially over the intermeeting period.

M2 continued to expand at a slow rate in* August, while M3 turned up after declining

in June and July. For the year throughAugust, M2 and M3 are estimated to havegrown at rates close to the lower end of theCommittee's ranges for the year. Totaldomestic nonfinancial debt has expanded ata moderate rate in recent months, and for theyear through July it is estimated to haveincreased at a rate in the lower half of theCommittee's monitoring range.

The Federal Open Market Committee seeksmonetary and financial conditions that willfoster price stability and promote sustainablegrowth in output. In furtherance of theseobjectives, the Committee at its meeting inJuly lowered the ranges it had established inFebruary for growth of M2 and M3 to rangesof 1 to 5 percent and 0 to 4 percentrespectively, measured from the fourthquarter of 1992 to the fourth quarter of 1993.The Committee anticipated thatdevelopments contributing to unusualvelocity increases would persist over thebalance of the year and that money growthwithin these lower ranges would beconsistent with its broad policy objectives.The monitoring range for growth of totaldomestic nonfinancial debt also was loweredto 4 to 8 percent for the year. For 1994, theCommittee agreed on tentative ranges formonetary growth, measured from the fourthquarter of 1993 to the fourth quarter of 1994,of I to 5 percent for M2 and 0 to 4 percentfor M3. The Committee provisionally set themonitoring range for growth of total domesticnonfinancial debt at 4 to 8 percent for 1994.The behavior of the monetary aggregates willcontinue to be evaluated in the light ofprogress toward price level stability,movements in their velocities, anddevelopments in the economy and financialmarkets.

64947


In the Implementation of policy for theimmediate future, the Committee seeks tomaintain the existing degree of pressure onreserve positions. In the context of theCommittee's long-run objectives for pricestability and sustainable economic growth,and giving careful consideration to economic,financial, and monetary developments,slightly greater reserve restraint or slightlylesser reserve restraint might be acceptable inthe intermeeting period. The contemplatedreserve conditions are expected to beconsistent with modest growth in M2 and M3over the balance of the year.

By order of the Federal Open MarketCommittee, December 3, 1993.Normand Bernard,Deputy Secretary, Federal Open MarketCommittee.[FR Doc. 93-30143 Filed 12-9-93; 8:45 am]BILLING CODE 6210-01-f


Paperwork Reduction Act Applications

AGENCY: Federal Trade Commission.ACTION: Notice of application to OMBunder the Paperwork Reduction Act (44U.S.C. 3501-3520) for clearance ofinformation collection requirementscontained in several regulations issuedor enforced by the Commission.

SUMMARY: The FTC is seeking OMBclearance for provisions of severalregulations, issued or enforced by theCommission, that contain or maycontain requirements for the collectionof information under the PaperworkReduction Act ("PRA"). The FTCpreviously sought and obtained OMBclearance for these regulations,including provisions requiringdisclosures to consumers or other thirdparties. The Supreme Courtsubsequently has held that third-partydisclosure requirements are not subjectto the Paperwork Reduction Act, Dole v.United Steelworkers of America, 494U.S. 26 (1990). The Commission istherefore revising its estimates ofburdens imposed by these rules toreflect only those provisions that, inlight of Dole and other relevant law,impose or may impose informationcollection requirements subject to thePRA. As provided in OMB's regulations,5 CFR 1320.7(b)(1), the estimates ofinformation collection burden excludeeffort that would be expended in theabsence of the requirement, such asrecordkeeping in the ordinary course ofbusiness.DATES: Comments on this applicationmust be submitted on or before January10, 1994.ADDRESSES: Send comments both toOffice of Information and Regulatory

Affairs, Office of Management andBudget, New Executive Office Building,room 3228, Washington, DC 20503,ATN: Desk Officer for the FederalTrade Commission, and to the Office ofthe General Counsel, Federal TradeCommission, Washington, DC 20580.Copies of the submission to OMB,including the application, may beobtained from the Public ReferenceSection, room 130, Federal TradeCommission, Washington, DC 20580.FOR FURTHER INFORMATION CONTACT:Elaine W. Crockett, Attorney, Office ofGeneral Counsel, Federal TradeCommission, Washington, DC 20580,(202) 326-2453.SUPPLEMENTARY INFORMATION: Thefollowing rules will be affected:

1. The Games of Chance Rule, 16 CFRpart 419, e~tablishes requirements,including disclosure requirements, forfood and gasoline retailers inconducting and advertising games ofchance. The Rule also requires thatgames promoters retain records showingcompliance with certain provisions, andrecords identifying winners, prizes, andnumber of game pieces. Therecordkeeping requirements assist in theenforcement of the Rule.

Estimate of Information CollectionBurden. In 1988, the burden imposed bythe "information collectionrequirements" associated with theGames of Chance Rule was estimated at10,000 hours. After excluding disclosurerequirements, staff estimates the burdenassociated with the Rule atapproximately 4,500 hours.

Respondents: Game promoters.Number of respondents: 30.Frequency of response: An average of

50 games per year.Average burden per response: 3 hours.2. The Funeral Rule, 16 CFR part 453,

prohibits as unfair or deceptive acts orpractices a variety of misrepresentationsand other practices in sale of funeralgoods and services, and requiresdisclosure of certain items ofinformation to customers for such goodsand services. The Rule also requires thatfuneral providers retain recordsdemonstrating their compliance withcertain provisions of the Rule for a one-year period. The recordkeepingrequirements assist in the enforcementof the Rule.

The Rule provides for a mandatoryreview four years after promulgation todetermine whether the Rule should beamended or terminated. TheCommission has conducted that review,and on January 28, 1993, tentativelyapproved an amended Funeral Rule thatretains the substance of the originalrecordkeeping requirements.

Estimate of Information CollectionBurden. In 1988, the burden imposed bythe "information collectionrequirements" associated with theFuneral Rule, including disclosurerequirements, was estimated at 177,000hours. After excluding disclosurerequirements, staff estimates the burdenassociated with the Rule atapproximately 21,000 hours. Thisestimate is consistent with the 1988estimate for recordkeeping hours.

Respondents: Funeral providers.Number of respondents: 21,000.Frequency of response: Ongoing.Average burden per response: 1 hour.3. The Equal Credit Opportunity Act

("ECOA"), 15 U.S.C. 1691 et seq.,prohibits discrimination in theextension of credit on the basis of sex,marital status, race, color, religion,national origin, age, derivation ofincome from a public assistanceprogram, or good faith exercise of anyright under the Consumer CreditProtection Act. Regulation B, 12 CFRpart 202, promulgated by the Board ofGovernors of the Federal ReserveSystem, implements the ECOA. Amongother things, § 202.12 of Regulation Brequires creditors to retain recordsrelating to consumer credit applicationsfor 25 months, and records of businesscredit applications for 12 months.Section 202.13 of Regulation.B requirescreditors that receive mortgage creditapplications to record the applicant'srace or national origin, sex, maritalstatus, and age. Appendix B ofRegulation B includes a model form thatcreditors may, but need not, use torequest the information required by§ 202.13. These requirements assist inenforcement of the Act andimplementing regulations. The FTC isthe enforcing agency as to all creditorsexcept those (such as federally charteredor insured depository institutions) thatare subject to the regulatory authority ofanother Federal agency.

Estimate of Information CollectionBurden. In 1987, the burden imposed bythe "information collectionrequirements" associated withRegulation B, including disclosurerequirements, was estimated at6,357,400 hours. After excludingdisclosure requirements, staff estimatesthe burden at 1,004,000 hours.

Recordkeeping respondents: Creditfirms.

Number of respondents: 1,000,000.Frequency of response: Ongoing.Average burden per response: 1 hour.Collection of monitoring information:Respondents: Mortgage credit firms.Number of respondents: 4,000.Frequency of response: Ongoing.

64948


Average burden per response: 1 hour.4. The Electronic Fund Transfer Act,

15 U.S.C. 1693 et seq.("EFTA"),requires accurate disclosure of the costs,terms and rights relating to electronicfund transfer (EFT) services toconsumers. Regulation E, promulgatedby the Board of Governors of the FederalReserve System, implements the EFTA.Among other things, § 205.13 ofRegulation E requires entities subject tothe EFTA to retain evidence ofcompliance with the regulation for twoyears. These requirements assist in theenforcement of the Act andimplementing regulations. The FTC isthe enforcing agency for the EFTA andRegulation E as to all entities providingEFT services except those (such asfederally chartered or insureddepository institutions) that are subjectto the regulatory authority of anotherFederal agency.

Estimate of Information CollectionBurden. In 1987, the burden imposed bythe "information collectionrequirements" associated withRegulation E, including disclosurerequirements, was estimated at 726,000hours. After excluding disclosurerequirements, staff estimates the burdenat 500,000 hours.

Respondents: Firms offering EFTservices to consumers.

Number of respondents: 500,000.Frequency of response: Ongoing.Average burden per response: 1 hour.5. The Consumer Leasing Act, 15

U.S.C. 1667 et seq., was enacted tofoster comparison shopping andinformed decisionmaking by requiringaccurate disclosure of the costs andterms of leases to consumers. RegulationM, promulgated by the Board ofGovernors of the Federal ReserveSystem, implements the ConsumerLeasing Act. Section 213.6 of RegulationM requires lessors to retain evidence ofcompliance with the regulation (otherthan advertising requirements) for twoyears after the date that disclosures arerequired to be made. Theserequirements assist in enforcement ofthe Act and implementing regulations.The FTC is the enforcing agency for theConsumer Leasing Act as to all lessorsexcept those (such as federally charteredor insured depository institutions) thatare subject to the regulatory authority ofanother Federal agency.

Estimate of Information CollectionBurden. In 1987, the burden imposed bythe "information collectionrequirements" associated withregulation M, including disclosurerequirements, was estimated at 80,700hours. After excluding disclosurerequirements, but adjusting for an

increase in number of industry membersand of leasing activity, staff estimatesthe burden at 100,000 hours.

Respondents: Firms leasing productsto consumers.

Number of respondents: 100,000.Frequency of response: Ongoing.Average burden per response: 1 hour.6. The Truth-in Lending Act, 15

U.S.C. 1601 et seq. ("TILA"), providesfor Calculation and disclosure of creditcosts and terms in all types of consumercredit transactions. The TILA alsoestablishes billing error resolutionprocedures and limits consumerliability for the unauthorized use ofcredit cards. Regulation Z, promulgatedby the Board of Governors of the FederalReserve System, implements the TILA.Among other things, § 226.25 ofRegulation Z requires creditors to retainevidence of compliance with theregulation (other than the advertisingrequirements) for two years after thedate disclosures are required to be madeor other action is required to be taken.These requirements assist inenforcement of the Act andimplementing regulations. The FTCenforces the TILA as to all creditorsexcept those (such as federally charteredor insured depository institutions) thatare subject to the regulatory authority ofanother Federal agency.

Estimate of Information CollectionBurden. In 1987, the burden imposed bythe "information collectionrequirements" associated withRegulation Z, including disclosurerequirements, was estimated at19,000,000 hours. After excludingdisclosure requirements, staff estimatesthe burden at 1,000,000 hours.

Respondents: Credit firms.Number of respondents: 1,000,000.Frequency of response: Ongoing.Average burden per response: 1 hour.7. Administrative Activities. The

information collection requests that arecurrently approved by OMB in thisitem, OMB control number 3084-0047,constitute administrative or proceduralmatters. Each of these requests specifiesinformation to be submitted voluntarilyto the Commission by persons who wishto do business with or receive somebenefit from the agency. Because of thelimited burden imposed, these requestsfor OMB approval of administrative/procedural matters have been combinedinto a single item. The requestscurrently included in this subsectionrelated to:

(a) FTC procurement activities:(b The document order form used by

the FTC public reference branch;c} Procedures under which states

may petition the FTC for exemptionsfrom certain FTC rules; and

(d) Rules governing claims under theEqual Access to Justice Act.

The FTC seeks to modify item (c toadd three requests and delete onecurrently included request. There are nochanges to the other items. The FTC isrevising the description of item (c) toread as follows:

(c) Procedures for applying to the FTCfor specific exemptions or modificationsunder certain FTC rules.

The item currently includesprocedures (16 CFR part 901) underwhich states may petition the FTC forexemptions from the Fair DebtCollection Practices Act, 5 U.S.C. 1692.A procedure for state petitions forexemption from Commission rulesunder the Credit Practices Rule, 16 CFR444.5, has been omitted from this item.Unlike the procedure under 16 CFR part901, this procedure does not specify anyinformation to be provided as part of thepetition. Pursuant to OMB regulationsunder the PRA, 5 CFR 1320.7(j)(10), theDirector of OMB has determined thatnonspecific requirements are exceptedfrom coverage. OMB/OIRA InformationCollection Review Handbook, p. 32(1989).

The following requests are added tothe item: procedures for requesting theestablishment of generic names fortextile fibers under the Textile FiberProducts Identification Act ("TextileAct"), 15 U.S.C. 70; procedures forapplications to exclude certain articlesand products from disclosurerequirements under the Wool ProductsLabeling Act ("Wool Act"), 15 U.S.C.68; and procedures for exemption fromcertain disclosure requirements underthe Fur Products Labeling Act ("FurAct"), 15 U.S.C. 69.

Under Section 303.8 of the FTC'sregulations implementing the TextileAct, 16 CFR 303.8, textile firms may fileapplications to initiate a rulemakingproceeding to establish a generic nameand definition for a new fiber. Theapplicant is required to providespecified information about the fiber.Under § 300.35 of the FTC's regulationsimplementing the Wool ProductsLabeling Act, 16 CFR 300.35, firms mayfile applications for hearing anddeterminations by the FTC concerningwhether or not representations of thefiber content of a class of articles arecommonly made, or whether or not thetextile content of certain products isinsignificant or inconsequential. Theapplicant is required to provide detailedtechnical information about the articlesor products. Under § 301.19(k) of theFTC's regulations implementing the FurProducts Labeling Act, 16 CFR301.19(k), firms may seek an exemptionfrom the Act's labeling requirements in

64949


specified circumstances. The applicantmust provide an affidavit, together withsupporting facts, establishing thatcertain types of fur pelts are alwaysdyed or always natural, and that thepelts cannot reasonably be marked asthe rule requires. In each case, theinformation will be used by the FTC todetermine whether the applicationshould be granted.

Estimate of Information CollectionBurden. In 1988, the burden imposed bythe "information collectionrequirements" was estimated at15,540,000 hours for the Textile Actregulations (including disclosurerequirements); at 2,281,000 hours for theWool Act regulations; and at 108,000hours for the Fur Act regulations.Because each of the above describedprovisions are the only provisions ofthese regulations that are subject to theOMB approval process, are rarely if everused, entail a small burden, and entaila procedure for requesting a specificexemption or modification under anFTC rule, they have been incorporatedinto item (c) of the AdministrativeActivity matter. Staff estimates thecombined burden of item (c) at 50hours.

Respondents: States; textile, wool, orfur firms.

Number of respondents: 1.Frequency of response: Once.Average burden per response: 50

hours.The burdens estimated for the

unchanged requests are the same asthose currently approved by OMB. SeeSupporting Statement for details. Thetotal burden associated with theAdministrative Activities item has beenrounded up to 2,500 hours. That figureis unchanged from the currentlyapproved item.

By direction of the Commission.Donald S. Clark,Secretary.[FR Dec. 93-30241 Filed 12-9-93; 8:45 am]mBILUNG CODE 675i-01-M

[Dkt. C-39]

Cooper Industries, Inc.; ProhibitedTrade Practice, and AffirmativeCorrective Actions

AGENCY: Federal Trade Commission.ACTION: Consent order.

SUMMARY: In settlement of allegedviolations of federal law prohibitingunfair acts and practices and unfairmethods of competition, this consentorder requires, among other things, aTexas-based producer of low-voltageindustrial fuses, within 12 months, to

license certain technology tomanufacture the fuses and to divest thenecessary tooling, equipment, andmachinery to the Commission-approvedlicensee. The consent order prohibitsthe respondent from acquiring, withoutprior Commission approval, any interestin any firm with more than $3.5 millionin annual U.S. sales of the fuses, andrequires the company to notify theCommission and wait a specified periodbefore acquiring any firm selling lessthan that amount of fuses.DATES: Complaint and Order issuedOctober 26, 1993.1FOR FURTHER INFORMATION CONTACT:Howard Morse, FTC/H-394,Washington, DC 20580. (202) 326-2949.SUPPLEMENTARY INFORMATION: OnWednesday, July 14, 1993, there waspublished in the Federal Register, 58 FR37939, a proposed consent agreementwith analysis In the Matter of CooperIndustries, Inc., for the purpose ofsoliciting public comment. Interestedparties were given sixty (60) days inwhich to submit comments, suggestionsor objections regarding the proposedform of the order.

Comments were filed and consideredby the Commission. The Commissionhas ordered the issuance of thecomplaint in the form contemplated bythe agreement, made its jurisdictionalfindings and entered an order to divest,as set forth in the proposed consentagreement, in disposition of thisproceeding.

(Sec. 6, 38 Stat. 721; 15 U.S.C. 46. Interpretor apply sec. 5, 38 Stat 719, as amended; sec.7,-38 Stat. 731, as amended; 15 U.S.C. 45, 18)Donald S. Clark,Secretary.[FR Dec. 93-30242 Filed 12-9-93; 8:45 am]BILUNG CODE 6780-01-M

[DkL C-3132]

General Motors Corporation, et al.;Prohibited Trade Practices andAffirmative Corrective Actions

AGENCY: Federal Trade Commisgion.

ACTION: Set aside order.

SUMMARY: The Federal TradeCommission has set aside a 1984consent order with General MotorsCorporation, et al., (49 FR 18289), thusremoving the Commission's requirementlimiting the duration of the joint venture(New United Motor Manufacturing, Inc.)between General Motors Corporation

' Copies of the Complaint, the Decision andOrder, and Commissioner Azcuenaga's statementare available from the Commission's PublicReference Branch, H-130, 6th Street & PennsylvaniaAvenue NW., Washington. DC 20580.

and Toyota Motor Corporation toproduce subcompact cars in California.The Commission concluded thatchanged conditions in the industrywarranted reopening and setting asidethe order.DATES: Consent order issued April 11,1984. Set Aside Order issued October29, 1993.FOR FURTHER INFORMATION CONTACT:Daniel Ducore, FTC/S-2115,Washington, DC 20580. (202) 326-2526.SUPPLEMENTARY INFORMATION: In theMatter of General Motors Corporation, etal. The prohibited trade practices and/or corrective actions as set forth at 49 FR18289, are removed as indicated.(Sec. 6, 38 Stat. 721; 15 U.S.C. 46. Interpretor apply sec. 5. 38 Stat. 719, as amended; sec.7. 38 Stat. 731, as amended; 15 U.S.C. 45, 18)Commissioners:

Janet D. Steiger, ChairmanMary L. AzcuenagaDeborah K. OwenRoscoe B. Starek, IllDennis A. Yao

Order Granting Petition to Reopen andSet Aside Order

In the matter of General MotorsCorporation, a corporation, and Toyota MotorCorporation, a corporation.

On June 28, 1993, the respondents,General Motors Corporation ("GM") andToyota Motor Corporation ("Toyota")(hereafter "the respondents"), togetherwith their joint venture, New UnitedMotor Manufacturing, Inc. ("NUMMI"),1filed a Petition To Reopen theProceeding and To Vacate the ConsentOrder ("Petition"), pursuant to Section5(b) of the Federal Trade CommissionAct, 15 U.S.C. 45(b), and Section 2.51 ofthe Commission's Rules of Practice andProcedure, 16 CFR 2.51. In theirPetition, the respondents ask theCommission to reopen the proceeding inDocket No. C-3132 and set aside theconsent order issued by the Commissionon April 11, 1984, in General MotorsCorporation, et al., 103 F.T.C. 374(1984) ("order"). The Petition wasplaced on the public record for thirtydays, pursuant to Section 2.51 of theCommission's Rules. Seventeencomments, all in favor of granting thePetition, were received.

After reviewing the Petition and otherrelevant information, the Commissionhas determined to grant the Petition.The respondents have shown changedconditions of fact, that eliminate theneed for the order and make itscontinued application to the

INUMMI, the Joint venture established by GMand Toyota, is not a respondent under theCommission's order.

64950

Federal Register / Vo1. 58, No. 236 / Friday, December 10, 1993 / Notices

respondents inequitable and harmful tocompetition.

L The Complaint and Order and theRespondents' Petition

The Commission's 1984 complaint inthis matter alleged that the proposedjoint venture between GM and Toyotawould violate section 7 of the ClaytonAct, 15 U.S.C. 18, and section 5 of theFTC Act, 15 U.S.C. 45, by lesseningcompetition in the "manufacture andsale of small new automobiles * * *includjing] * * * subcompact, compact,and intermediate sized automobiles" inthe United States and Canada. Thecomplaint alleged, among other things,that the proposed joint venture couldlessen competition (1) by expanding theoutput of the joint venture beyond whatwould reasonably be necessary toaccomplish the legitimate purposes ofthe joint venture, and (2) by failing toprovide adequate safeguards against theexchange of competitively significantinformation beyond the minimumreasonably necessary to accomplish thelegitimate purposes of the venture.These effects, singly or in combination,allegedly would increase significantlythe likelihood of noncompetitivecooperation between GM and Toyota.

The Commission's order, Issued withthe consent of GM and Toyota,permitted them to undertake the jointventure, but limits the scope of theventure and the exchange of informationbetween GM and Toyota and with anyjoint venture. The order limits the jointventure to manufacturing for, or sellingto, GM not more than approximately250,000 automobiles per year,2 exceptwith the prior approval of theCommission, and limits the duration ofthe joint venture to the earlier of twelveyears from the start of production orDecember 31, 1997.

The order limits the exchange ofnonpublic information concerningprices and costs of GM or Toyota carsor parts, sales or production forecasts,and marketing plans for any product. Inaddition, the order limits discussions ofproduct designs, sales or productionforecasts, and the cost of productssupplied by the co-venturers to those"necessary to accomplish, and solely inconnection with, the legitimatepurposes or functioning" of the jointventure. The order also containsrecordkeeping and other requirements

2In addition, the order limits the cars made bythe joint venture for GM to cars "derived from theToyota Sprinter." NUMMI presently makes theChevrolet Geo Prizm for GM. The order does notsimilarly limit NUMMN1s production for Toyota.NUMMI makes the Corolla and a compact pickuptruck for Toyota and also makes automobile parts.

to help monitor the respondents'compliance with the order.

The respondents ask the Commissionto set aside the order "in its entirety" topermit GM and Toyota to continue thejoint venture. In support of the Petition,the respondents assert, among otherthings, that in the context of what theyview as fundamental changes in therelevant market since 1984, setting asidethe order's limit on the scope of thejoint venture will allow thecontinuation of important efficiencygains that benefit competition. Therespondents also assert that setting asidethe order's restrictions on the output ofthe joint venture and on certaincommunications would be in the publicinterest, because the restrictions "areburdens imposed on no otherautomotive producers and thereforeplace NUMMI at a serious competitivedisadvantage." Petition at 21.

II. Standards for Reopening andModifying an Order

Section 5(b) of the Federal TradeCommission Act, 15 U.S.C. 45(b),provides that the Commission shallreopen an order to consider whether itshould be modified if the respondent"makes a satisfactory showing thatchanged conditions of law or fact" sorequire. A satisfactory showingsufficient to require reopening is madewhen a request to reopen identifiessignificant changes in circumstancesand shows that the changes eliminatethe need for the order or makecontinued application of it inequitableor harmful to competition. S. Rep. No.96-500, 96th Cong., 2d Sess. 9 (1979)(significant changes or changes causingunfair disadvantage); Louisiana-PacificCorp., Docket No. C-2956, Letter to JohnC. Hart (June 5, 1986), at 4(unpublished) ("Hart Letter").3

Section 5(b) also provides that theCommission may modify an orderwhen, although changed circumstanceswould not require reopening, theCommission determines that the publicinterest so requires. Respondents aretherefore invited in petitions to reopento show how the public interestwarrants the requested modification.Hart Letter at 5; 16 CFR 2.51. In such acase, the respondent must demonstrateas a thieshold matter some affirmativeneed to modify the order. Damon Corp.,Docket No. C-2916, Letter to Joel E.Hoffman, Esq. (March 29, 1983), at 2(unpublished) ("Damon Letter"). For

3 See also United States v. Louisiana-PacificCorp., 967 F.2d 1372,1376-77 (9th Cir. 1992) ("Adecision to reopen does not necessarily entail adecision to modify the order. Reopening may occureven where the petition itself does not plead factsrequiring modification.").

example, it may be in the public interestto modify an order "to relieve anyimpediment to effective competitionthat may result from the order." DamonCorp., Docket No. C-2916, 101 F.T.C.689, 692 (1983). Once such a showingof need is made, the Commission willbalance the reasons favoring therequested modification against anyreasons not to make the modification.Damon Letter at 2. The Commission alsowill consider whether the particularmodification sought is appropriate toremedy the identified harm. DamonLetter at 4.

The language of Section 5(b) plainlyanticipates that the burden is on thepetitioner to make a "satisfactoryshowing" of changed conditions toobtain reopening of the order. Thelegislative history also makes clear thatthe petitioner has the burden ofshowing, other than by conclusorystatements, why an order should bemodified. The Commission "mayproperly decline to reopen an order if arequest is merely conclusory orotherwise fails to set forth specific factsdemonstrating in detail the nature of thechanged conditions and the reasonswhy these changed conditions requirethe requested modification of theorder." S. Rep. No. 96-500,96th Cong.,1st Sess. 9-10 (1979); see also Rule2.51(b) (requiring affidavits in supportof petitions to reopen and modify). If theCommission determines that thepetitioner has made the necessaryshowing, the Commission must reopenthe order to consider whethermodification is required and, if so, thenature and extent of the modification.The Commission is not required toreopen the order, however, if thepetitioner fails to meet its burden ofmaking the satisfactory showingrequired by the statute. The petitioner'sburden is not a light one in view of thepublic interest in repose and the finalityof Commission orders. See FederatedDepartment Stores, Inc. v. Moitie, 425U.S. 394 (1981) (strong public interestconsiderations support repose andfinality).

II. The Respondents Have ShownChanged Conditions of Fact ThatRequire Reopening the Order, and theRestrictions on the Scope of the JointVenture Should Be Set Aside

The order limited the scope of thejoint venture to preserve the incentivesof GM independently to make and sellnew automobiles and to preventnoncompetitive cooperation betweenGM and Toyota. The Commission findsthat the respondents have made asatisfactory showing of changedconditions in the North American

64951


automobile market that requirereopening the order. The Commissionalso finds that the changed conditionsdemonstrated by the respondentseliminate the need for the order'srestrictions on the duration and theoutput of the joint venture.

Since 1984, when the order wasissued, significant new entry andexpansion in the automobile industryhave occurred in North America,4including the United States, Canada'andMexico.s Sales in the United States ofsubcompact, compact and midsizedautomobiles (the product marketidentified in the complaint) have grownfrom about 58% to more than 77% ofnew car sales.6 In 1984, U.S. car buyerscould choose among 16 subcompact, 14compact and 24 midsized cars; 7 in1992, U.S. car buyers could chooseamong 42 subcompact, 20 compact and37 midsized cars.8 GM and Toyota eachhas made major investments in carproduction in the United States, outsidethe NUMMI joint venture. GM hasdeveloped new models of its existing •lines of cars and introduced the Saturnline of automobiles. Toyota has builttwo assembly plants in North Americaand has introduced new vehicles (theLexus line of automobiles, the T-100pickup truck and a new larger Camry)to compete with GM's larger cars.

The new automobile market hasbecome less concentrated since 1984.9

4 At the same time, new passenger car productionin North America has declined from about 8.8million units (U.S. and Canada) In 1984 to about 7.5million (U.S., Canada and Mexico) In 1992.Automotive News, 1985 Market Data Book at 4. 8(hereafter "(year) Market Data Book"); 1993 MarketData Book at 4. Total U.S. retail sales of domesticand imported cars were about 10.4 million in 1984(1985 Market Data Book at 4) and about 9.5 millionin 1992. 1993 Market Data Book at 4.

5 Although Mexico was not in the NorthAmerican market identified in the complaint, since1984, cars produced in Mexico have achieved about10% of U.S. car sales. See 1993 Market Data Bookat 4.

e 1985 Market Data Book at 22; 1993 Market DataBook at 26.

7 See 1985 Market Data Book at 12.a See 1993 Market Data Book at 26. The top

selling cars in the United States in 1992 were (1)Ford Taurus, (2) Honda Accord, (3) Toyota Cary,(4) Ford Escort, (5) Honda Civic, (6) ChevroletLumina, (7) Chevrolet Cavalier, (8) Pontiac GrandAm, (9) Ford Tempo, (10) Saturn, (11) ToyotaCorolla, (12) Chevrolet Corsica-Beretta, (13) NissanSentra, (14) Buick LeSabre and (15) CadillacDeville. Id. at 21.

9 According to the respondents, based on 1983and 1992 unit sales, the Herfindahl-HirschmanIndex ("HHI") for car manufacturing has declinedfrom 2455 to 1959 for the United States and from2363 to 1859 for North America. Petition at 5. Theamount of the decline in the HHI between 1983 and1992 (about 500 points) is greater than the increasethat would have resulted from a full mergerbetween GM and Toyota in 1983 (about 480 points).Although the HHI has declined to 1859, therespondents' figures show that it remains above1800, the level at which the 1992 Horizontal Merger

In 1984, GM was the leading maker andseller of cars in the United States, with44.4% of passenger car sales.lo Ford(19.26%) and Chrysler (9.51%) weresecond and third. Toyota, the thirdlargest motor vehicle manufacturer inthe world, had 5.4% of U.S. sales.Manufacturing capacity in the UnitedStates of foreign automobile producers("transplant" producers) consisted oftwo plants, a Honda facility in Ohio anda Nissan truck facility in Tennessee.Imports from countries such as Koreaand Mexico were not significant.

In 1992, GM remains the leadingproducer and seller of automobiles inthe United States, with 34.6% of sales.,GM is followed by Ford (21.6%),Honda/Acura (9.4%), Toyota/Lexus(9.3%), Chrysler (8.3%), Nissan/Infiniti(5%) and VW/Audi (1.1%).12 In 1992,12 Japanese and 2 European transplantcar assembly plants operated in NorthAmerica (including Mexico).13 Thetransplant assembly plants opened byJapanese car manufacturers, eitherdirectly or through joint ventures,during the period from 1982 through1989, have added more than 2.5 millionunits of production of capacity in NorthAmerica. Hyundai, a Korean carmanufacturer, sold more than 1.2million cars in North America between1986 and 1992 and in 1989 opened aplant in Quebec with a capacity of100,000 vehicles.14 The transplantoperations for the most part emphasizesmaller cars, and their presence inNorth America ensures that their abilityto expand sales is not limited by exportrestrictions.-5 Imports from other

Guidelines, reprinted in 4 Trade Reg. Rep. (CCH)113,104, at 6 1.5, define a market as highlyconcentrated.

IoGM had 43% of North American automobilesales in 1984. Glassman, & Cronin, EconomicJustifications for Authorizing UnrestrictedProduction of Automobiles by NUMMI 8-9 (June29, 1993), submitted in support of respondents'Petition.

1IGM's share of North American car sales was33.4% in 1992. In 1984, GM produced cars in 24facilities in the United States and Canada; in 1992,GM had 18 plants in the United States and Canadaand one in Mexico. GM expects to close additionalplants by 1996. Petition at 5.

12The transplant assembly plants in the UnitedStates accounted for 25% of 1992 U.S. carproduction. 1993 Market Data Book at 12.

13 In addition, BMW and Mercedes Benz recentlyhave announced plans to build plants in the UnitedStates, with a combined announced capacity of120,000 cars. Petition at 5.

14 Petition at 4 and Tab 10.1s In 1984, when the order was issued, voluntary

restraint agreements ("VRA") limited the number ofcars that could be imported from Japan for sale inthe United States. The VRAs expired in 1985. Since1985. the government of Japan has implementedvoluntary export restraints ("VER"). In recent years,the number of cars exported from Japan to theUnited States consistently has fallen below the VERlimits. See 1993 Market Data Book at 4.

countries, including Korea, Mexico andBrazil, amounted to 412,471 cars in1992.16 Honda, Toyota and Nissan haveexpanded into new market niches bymarketing Acura, Lexus and Infiniti carsin the "luxury" segment of the market.

A number of joint ventures and othercooperative arrangements betweenautomobile manufacturers have beenformed since 1984. Ford and Mazdaformed Auto Alliance International,Inc., a joint venture that assembles smallcars (Ford Probe, Mazda MX6, andMazda 626) in a plant in Flat Rock,Michigan.17 Ford and Mazda alsocooperate in other areas. For example,Ford makes the Mazda Navajo sport-utility vehicle, which competes withFord's Explorer, and Mazda and Fordcollaborated on the development ofFord's subcompact Escort.18 Fordrecently formed a "cooperativeassociation" with Nissan, Japan'ssecond largest automobile producer(after Toyota), to produce MercuryVillager and Nissan Quest minivans atFord's plant in Avon Lake, Ohio.19

In 1985, Chrysler and MitsubishiMotors Corporation establishedDiamond-Star Motors to produce cars.20

Although Chrysler sold its interest inDiamond-Star to Mitsubishi in 1991,21

the two companies continue jointly todevelop models produced by Diamond-Star. Chrysler distributes Japanese-madeMitsubishi vehicles in the United States,and Chrysler and Mitsubishi collaboratein design, engineering andmanufacturing technology and know-how. Subaru and Isuzu 22 haveestablished a North American assemblyjoint venture, Subaru-Isuzu Automotive,Inc. ("SIAI"). SIAI has a plant inLafayette, Indiana, with an annualcapacity of about 169,000 units.23 GM

10 Petition. Tab 11."7 Ford has a 25% equity interest in Mazda.

Petition at 6.to Petition. Tab 12 ("How Ford and Mazda Shared

the Driver's Seat." Business Week, March 26, 1990.at 94).

'@Petition, Tab 13 (A. Harmon, "A Van Vanguard;Ford, Nissan Overcome Distrust To Build TheirFirst Vehicle Together." Los Angeles Times, July20, 1992, at DI).

2oDiamond-Star began making small cars in theU.S. in 1988. In 1991, it was making the MitsubishiEclipse and Mirage, the Plymouth Laser, and theEagle Talon and Summit at its Normal, Illinois,plant. Petition, Tab 14 ("Chrysler, MitsubishiMotors Agree to Major Restructuring of Diamond-Star Joint Venture," PR Newswire, October 29,1991).

21 Chrysler has a 5.9% equity interest inMitsubishi.

22GM owns a 38% equity interest in Isuzu.Petition, Tab 7 (Rogers Affidavit).

23 In 1992, SIAI produced 57,623 Subaru Legacysedans and station wagons. The plant also produceslsuzu pickup trucks and sport-utility vehicles.Petition at 7.

64952


and Suzuki 24 are partners in a jointventure called CAMI Automotive, Inc.CAMI's plant in Ontario, Canada, withan annual capacity of 205,000 cars,makes Chevrolet Geo Tracker and Metrovehicles for GM.25

Since the inception of NUMMI, GMhas continued to make small cars (the"J" car (Chevrolet Cavalier and PontiacSunbird)) and has added two families ofcompact cars to its fleet (the "N" car(Pontiac Grand Am, OldsmobileAchieva and Buick Skylark) and the "L"car (Chevrolet Corsica and Beretta)). GMproduced more than 9 million "J," "L"and "N" cars in the United Statesbetween 1985 and 1992, which is morethan ten times the number of cars thatNUMMI produced for GM during thesame period. Petition at 14-15. In 1985,GM created the Saturn Corporation,which began making cars in 1990. TheSaturn plant in Spring Hill, Tennessee,currently makes 240,000 cars annually,and GM plans to increase production tomore than 300,000 units by the end of1993.26 In addition, in the last six years,Toyota has built two plants in NorthAmerica, in Georgetown, Kentucky, andCambridge, Ontario, Canada. Aftercompletion of an expansion at theGeorgetown plant, Toyota will have aNorth American capacity of 500,000vehicles annually.27

The changes in the industry that aredescribed above are changedcircumstances that eliminate the needfor the order's limitations on the outputand the duration of the joint venture.Entryand expansion in the automobilemarket in North America, althoughcostly and time-consuming, haveoccurred on a significant scale. In theface of such entry and expansion, thejoint venture is unlikely to create orfacilitate the exercise of market power.28

24 GM owns a 5.3% equity interest in Suzuki.Petition, Tab 7 (Rogers Affidavit).

25 Petition. Tab 7 (Rogers Affidavit). In 1992,CAMI produced 96,404 small cars, the Geo Metroand the Suzuki Swift. 1993 Market Data Book at 1o.

e Although the Commission has at times lookedskeptically at certain evidence of post-acquisitionexculpatory conduct that is within the control ofthe respondent, see. e.g., B.F. Goodrich, 100 F.T.C.207, 340-42 (1988). GM's substantial investment inSaturn Corp.. both in terms of dollars (more than$2 billion in the Tennessee plant and a similaramount in marketing the Saturn line) and good will,and Saturn's success in the market suggest that GMis unlikely to abandon the Saturn line in favor ofoutput from NUMMI. In 1992, only two years afterbeginning production, the Saturn line of carsaccounted for almost 8% of GM's total sales.

27 Petition, Tab 8 (Yasuda affidavit).zsSee 1992 Horizontal Merger Guidelines § 3.0;

Genstar Limited, 104 F.T.C. 264 (1984) (ordermodified on showing of expansion and entry In therelevant market that eliminated need for orderrestriction); cf. Louisiana-Pacific Corp., 112 F.T.C.547, 559 (1989) (no claim of changes in structuralcharacteristics of market, such as ease of entry, thatmight obviate need for remedy provided by order).

In addition, the development by GM ofthe Saturn line of cars is a significantchange that eliminates the concern thatthe establishment of NUMMI woulddeter independent development andproduction of small cars in NorthAmerica by GM. GM's substantialinvestment in Saturn, the increasingpresence of transplant operations andthe substantial increase in small carmodels available to consumers since1984 all suggest that the basis for theconcern reflected in the complaint andorder about diminished competition inthe small car market has beeneliminated. There appears to be nocontinuing need for the order'srestrictions on the duration and scope ofthe joint venture, and continuing therestrictions in the context of thechanged conditions may hinder theability of the joint venture to respond toconsumer demand.

The Commission has determined thatthe changes in the industry aresignificant changes that eliminate theneed for the order's limitations on theoutput and the duration of the jointventure. Accordingly, the order shouldbe reopened and Paragraphs II and I ofthe order should be set aside.

In addition to the changed conditionsof fact that have eliminated the need forthe order's limitations, GM and Toyotaalso assert significant efficiencies thathave been realized and that willcontinue to be realized if the order is setaside and the joint venture is notterminated.20 The record appears toshow that NUMMI may be one of themore efficient assembly plants in theUnited States.3o GM states that it iscontinuing to reap the benefits ofgaining first-hand experience with anefficient production system.31

29 The respondents state that NUMMI is asuccessful project of cooperative labor/managementrelations that facilitates GM's efforts to learn theToyota Production System, supplies the marketwith more than 300,000 high quality, low costvehicles annuallyand diffuses trade frictions.Petition at 8-12. Because the Petition is granted onthe ground of changed conditions of fact, theCommission need not address the question whetherthe public interest justifies the requested relief,including any efficiencies.

30 Petition, Tab I (Convis Affidavit) (describingNUMMI's efficiency efforts). See Petition at 9(referring to studies by. industry authorities.management experts and academicians that showNUMMI's efforts to improve efficiency); Petition,Tab 16 at 97 (case study of NUMMI appearing inthe February 1993. Harvord Business Reviewconcluding, in part, that NUMMI "has succeeded inemploying an innovative form of * * time-and-motion regimentation on the factory floor not onlyto create world-class productivity and quality butalso to increase worker motivation andsatisfaction.").31 Petition. Tab 6 (Mutchler Affidavit) (GM

Initially adopted "a piece-meal approach to thelearning process"; in 1989-90, however, GM "beganto understand that each element of the Toyota

Moreover, the parties assert thatpermitting NUMMI to continue itsoperations beyond 1996 will facilitateGM's efforts to reduce costs and giveGM continued access to small cars,consistent with the recognition thatNUMMI benefits GM by enabling it toobtain a low-cost domestic subcompacteconomy car.32 Thus, NUMMI's benefitsmay well continue beyond 1996.Extending NUMMI will permit thecontinuance of any efficiency gains thatbenefit competition in the relevantmarkets.

IIl. The Order's Restrictions onCommunications Also Should Be SetAside

Having determined to reopen theorder on the ground of changedconditions of fact and to set aside theorder's restrictions on the duration andoutput of the joint venture, we nextconsider whether the remainingprovisions of the order should beretained. The order's limitations on theexchange of certain nonpublicinformation among GM, Toyota andNUMMI addressed the concern, allegedin the complaint, that the joint venturemight facilitate noncompetitivecooperation between GM and Toyota.The respondents claim that therestrictions of the order impede theability of the joint venture to dobusiness. They also claim thatcommunications between participantsin other automobile industrycooperative ventures created since theorder was issued are not similarlyrestricted and that, as a result, GM,Toyota and NUMMI are unable tocommunicate as do their competitors.

The provisions of the order weredesigned to restrict communicationsthat might facilitate noncompetitivecooperation between GM and Toyota,while permitting communicationsnecessary to accomplish the legitimate.purposes and functioning of the jointventure. The respondents have shownthat, in some circumstances, the specificlimitations of the order impede theability of the respondents and the jointventure to engage in legitimate activity.For example, the respondents haveshown that the limitation on thbexchange of information concerning theprices of component parts supplied tothe joint venture prevents the jointventure from obtaining savings that mayresult from combining its market search

Production System is an essential part of thewhole."). See Petition at 11 (GM states that it "still the high cost producer in North America.").

3zPetition at 2, 11 (GM will be able to continueto obtain from NUMMI what it characterizes as "ahigh quality, low cost sedan-the Prizm-that Is theflagship of the Geo distribution network").

64953


activity with Toyota's, and fromrealizing cost savings to be generated bycombining its purchases withToyota's.33 The provision of the orderthat bars GM from discussing marketingplans with Toyota or NUMMI allegedlyhas hindered the ability of the parties torealize market opportunities andincreased their costs. For example, therespondents state that because GM wasunable to tell NUMMI about a potentialsale of cars in the fleet market, GM wasunable to persuade NUMMI to make aprice concession that might haveresulted in a transaction beneficial to allof the parties. On another occasion,according to the respondents, as a resultof GM's perceived inability under theorder to tell the joint venture aboutGM's plans to re-badge the Nova as theGeo Prizm, NUMMI wastefully spentfunds on tooling that was specific toNova and that later had to bescrapped.34

The respondents have shown that inthe context of significant changedconditions in the industry, therestrictions in the order on businesscommunications may increase the costsof the joint venture and hinder theability of the respondents and the jointventure to respond to competitiveconditions. At the same time, thecommunications that are limited by theorder are not per se unlawful, andsetting aside these provisions of theorder will not excuse the respondentsfrom compliance with laws that prohibitcollusive activity in restraint of trade.See General Railway Signal Co., 108F.T.C. 181 (1986) (modifying order). TheCommission has concluded that in thecontext of the changed conditions in theindustry, Paragraphs IV and V of theorder should be set aside to permit therespondents and NUMMI to engage incommunications ancillary to andreasonably necessary for the operationof the joint venture.35

Accordingly, It is ordered, That thismatter be and it hereby is reopened andthat the Commission's order in DocketC-3132, issued on April 11, 1984, beand it hereby is set aside, as of theeffective date of this order.

33 Petition at 16-17.34 Petition at 17-19; Kimura Affidavit; Rogers

Affidavit.35 The recordkeeping requirements of the order

are intended to assist the Commission inmonitoring the respondents' compliance with theorder's restrictions on the exchange of information.If the order's restrictions on communications are setaside, the recordkeeping and other compliancerequirements of the order (Paragraphs VI throughIX) also should be set aside.

By the Commission.Donald S. Clark,Secretary.

Concurring Statement of CommissionerMary L. Azcuenaga in General MotorsCorporation, Docket C-3132

I concur in the decision of theCommission to reopen and set aside theorder in this matter on the ground ofchanged conditions in the automobileindustry that eliminate the need for theorder. I do not endorse as relevant tothis decision the purported efficiencygains from NUMMI alleged by GM andToyota. See Order at 9-10.

GM and Toyota have assertedefficiencies that may or may not berealized in the future, if the respondentsdecide to continue their joint venture.1I hope that the asserted efficiencies willbe realized and that NUMMI will indeedbenefit competition, but these are notindependent reasons for reopening andsetting aside the order. Nor would itmatter, in the context of determiningwhether the order should be reopened,if NUMMI were inefficient. If theprojected efficiencies of the jointventure were not sufficient to forestallimposition of the order in the first place,how could the failure fully to achievethose efficiencies 2 or even theircontinuation justify setting the orderaside?

The order of the Commission is notpremised on the efficiency (orinefficiency) of the joint venture butrather on concerns, described ir thecomplaint, about the potential effects oncompetition of noncompetitivecooperation between GM and Toyota.When we are persuaded that changedconditions of fact in the market haveeliminated that concern, our task isdone, and we need not speculate, in thecontext of a petition to reopen, about theparties' predictions of potentialefficiencies.

GM and Toyota, in their businessjudgment, would prefer to continuetheir joint venture beyond the twelveyears provided in the order, becausethey believe that it will be profitable. Toaccept this reason as a basis forreopening and setting aside the order

I The order having been set aside, GM and Toyotawill be at liberty at any time (as they were at libertywhile the order was in effect) to discontinue theirjoint venture. The alleged "formidable regulatory,tax and logistical disadvantages to operating an autoplant in California," the "inherent difficulties inassembling vehicles" in the 30-year-old plant, thecost of required improvements to NUMMI's plant(expected to exceed $500 million). Petition at 13.and the fact that NUMMI "has not been consistentlyprofitable," Kimura Affidavit at 1. may provideincentives for doing so.

z See Jennings Affidavit at 4; Mutchler Affidavitat 2.

would relegate the decision whether toreopen final orders of the Commissionto the business preferences of therespondent. The Commission hasrejected this argument in the past, seeLouisiana-Pacific Corp., 112 F.T.C. 547,569 (1989) (rejecting as a basis forreopening the order the argument thatretaining rather than divesting aprofitable plant would enhance therespondent's ability to compete), and itshould continue to do so.

I fully concur in the decision toreopen and set aside the order on theground of changed conditions of fact.

Concurring Statement of CommissionerDeborah K. Owen in General MotorsCorporation, Docket No. C-3132

When the Commission accepted theconsent order in this matter in 1984, itwas generally recognized as a landmarkeffort to balance our dualresponsibilities of vigorously enforcingthe competition laws, while refrainingfrom unnecessarily interfering withlegitimate business activities. In light ofmarked changes in circumstances sincethat time, I believe that theCommission's determination to vacatethe order today follows in the traditionof its original decision, and I stronglyendorse it.

The Merger Guidelines recognize thatthe "larger universe" of combinationsare "either competitively beneficial orneutral." § 0.1.1 As part of their Petiionfor reopening, the parties havepresented an impressive array ofinformation about the positivecontributions of NUNMI, includingasserted efficiencies that have resultedfrom the joint venture. While the Order(at 9-10 n.29) notes that "Iblecause thePetition is granted on the ground ofchanged conditions of fact, theCommission need not address * * *any efficiencies", the Commissionnonetheless proceeds to comment onthis issue. Order at 9-10. Withoutmeaning to disparage the parties'assertions in this regard, because of thebasis for our decision, it is not necessaryfor the Commission, in my judgment, toevaluate, much less opine on, theexistence, extent and effect of suchefficiencies as part of this endeavor.Engaging in dicta is not without peril.[FR Doc. 93-30243 Filed 12-9-93; 8:45 am]BILUNG CODE 6750-01-A

I U.S. Dept. of Justice and Federal TradeCommission Horizontal Merger Guidelines,reprinted in 4 Trade Reg. Rep. (CXH) 113,104.

64954


(OkL C-3470]

Gracewood Fruit Company; ProhibitedTrade Practices, and AffirmativeCorrective Actions

AGENCY: Federal Trade Commission.

ACTION: Consent Order.

SUMMARY: In settlement of allegedviolations of federal law prohibitingunfair acts and practices and unfairmethods of competition, this consentorder requires, among other things, aFlorida corporation to have competentand reliable scientific evidence tosubstantiate future claims that eatingnormal quantities of grapefruit providesa variety of health benefits, such asreducing serum cholesterol and the riskof stoke, heart attack, and several typesof cancer. Also, the respondent isprohibited from misrepresenting anytest or study in connection with themarketing of any food.

DATES: Complaint and Order issuedOctober 26, 1993.1

FOR FURTHER INFORMATION CONTACT: LeePeeler or Anne Maher, FTC/S-4002, 6thSt. & PA. Ave., NW., Washington, DC20580. (202) 326-3090 or 326-2987.

SUPPLEMENTARY INFORMATION: OnTuesday, April 20, 1993, there waspublished in the Federal Register 58 FR21302, a proposed consent agreementwith analysis In the Matter ofGracewood Fruit Company, for thepurpose of soliciting public comment.Interested parties were given sixty (60)days in which to submit comments,suggestions or objections regarding theproposed form of the order.

A comment was filed and consideredby the Commission. The Commissionhas ordered the issuance of thecomplaint in the form contemplated bythe agreement, made its jurisdictionalfindings and entered an order to ceaseand desist, as set forth in the proposedconsent agreement, in disposition of thisproceeding.

(Sec. 6, 38 Stat. 721; 15 U.S.C. 46. Interpretsor applies sec. 5, 38 Stat. 719, as amended;15 U.S.C. 45, 52)Donald S. Clark,Secretary.[FR Doc. 93-30244 Filed 12-9-93; 8:45 am]BILUNG CODE 6750-01-M

'Copies of the Complaint and the Decision andOrder are available from the Commission's PublicReference Branch, H-130. 6th Street & PennsylvaniaAvenue, NW., Washington, DC 20580.

[File No. 912 34001

Presto Food Products, Inc.; ProposedConsent Agreement With Analysis ToAid Public Comment

AGENCY: Federal Trade Commission.ACTION: Proposed Consent Agreement.

SUMMARY: n settlement of allegedviolations of Federal law prohibitingunfair acts and practices and unfairmethods of competition, this consentagreement, accepted subject to finalCommission approval, would prohibit,among other things, a Californiacorporation from misrepresenting theabsolute or comparative amount of totalfat, saturated fat, or cholesterol inMocha Mix, Mocha Mix Lite, or in anymilk product or non-dairy substitute. Italso would prohibit the respondent frommisrepresenting the amount of thesenutrients relative to the serving sizebeing advertised for the products.DATES: Comments must be received onor before February 8, 1994.

ADDRESSES: Comments should bedirected to: FTC/Office of the Secretary,Room 159, 6th St. and Pa. Ave., NW.,Washington, DC 20580.FOR FURTHER INFORMATION CONTACT: C.Lee Peeler, FTC/S-4002, Washington,DC 20580. (202) 326-3090.SUPPLEMENTARY INFORMATION: Pursuantto section 6(f) of the Federal TradeCommission Act, 38 Stat. 721, 15 U.S.C.46 and § 2.34 of the Commission's Rulesof Practice (16 CFR 2.34), notice ishereby given that the following consentagreement containing a consent order tocease and desist, having been filed withand accepted, subject to final approval,by the Commission, has been placed onthe public record for a period of sixty(60) days. Public comment is invited.Such comments or views will beconsidered by the Commission and willbe available for inspection and- copyingat its principal office in accordance with§ 4.9(b)(6)(ii) of the Commission's Rulesof Practice (16 CFR 4.9b)(6)[ii)).

Agreement Containing Consent Order toCease and Desist

The Federal Trade Commissionhaving initiated an investigation ofcertain acts and practices of Presto FoodProducts, Inc., a corporation, hereinaftersometimes referred to as proposedrespondent, and it now appearing thatproposed respondent is willing to enterinto an agreement containing an order tocease and desist from the use of the actsand practices being investigated,

It is hereby agreed by and betweenPresto Food Products, Inc., by its dulyauthorized officer, and its attorney, and

counsel for the Federal TradeCommission that:

1. Proposed respondent Presto FoodProducts, Inc., is a corporationorganized, existing and doing businessunder and by virtue of the laws of theState of California with its office andprincipal place of business located at18275 Arenth Avenue, P.O. Box 584,CIty of Industry, California 91747-0584.

2. Proposed respondent admit all thejurisdictional facts set forth in the draftof complaint here attached.

3. Proposed respondent waives:(a) Any further procedural steps;(b) The requirement that the

Commission's decision contain astatement of findings of fact andconclusion of law;

(c) All rights to seek judicial reviewor otherwise to challenge or contest thevalidity of the order entered pursuant tothis..agreement; and

(d) Any claim under the Equal AccessTo Justice Act.

4. This agreement shall not becomepart of the public record of theproceeding unless and until it isaccepted by the Commission. If thisagreement is accepted by theCommission, it, together with the draftcomplaint contemplated thereby, will beplaced on the public record for a periodof sixty (60) days and information inrespect thereto publicly released. TheCommission thereafter may eitherwithdraw its acceptance of thisagreement and so notify the proposedrespondent, in which event it will takesuch action as it may considerappropriate, or issue and serve itscomplaint (in such form as thecircumstances may require) anddecision, in disposition of theproceeding.

5. This agreement is for settlementpurposes only and does not constitutean admission by proposed respondentthat the law has been violated as allegedin the attached draft complaint, or thatthe facts as alleged in the attached draftcomplaint, other than the jurisdictionalfacts, are true.

6. The agreement contemplates that, ifit is accepted by the Commission, andif such acceptance is not subsequentlywithdrawn by the Commission pursuantto the provisions of Section 2.34 of theCommission's Rules, the Commissionmay, without further notice to proposedrespondent: (1) Issue its complaintcorresponding in form and substancewith the draft complaint here attachedand its decision containing thefollowing order to cease and desist indisposition of the proceeding; and (2)make information public in respectthereto. When so entered, the order tocease and desist shall have the same

64955


force and effect and may be altered,modified or set aside in the samemanner and within the same timeprovided by statute for other orders. Theorder shall become final upon service.Delivery by the U.S. Postal Service ofthe complaint and decision containingthe agreed-to-order to proposedrespondent's address as stated in thisagreement shall constitute service.Proposed respondent waives any rightsit may have to any other manner ofservice. The complaint may be used inconstruing the terms of the order, andno agreement, understanding,representation, or interpretation notcontained in the order or the agreementmay be used to vary or contradict theterms of the order.

7. Proposed respondent has read theproposed complaint and ordercontemplated hereby. It understandsthat once the order has been issued, itwill be required to file one or morecompliance reports showing that it hasfully complied with the order. Proposedrespondent further understands that itmay be liable for civil penalties in theamount provided by law for eachviolation of the order after it becomesfinal.

Order

Definitions

For purposes of this Order, the term"milk product" shall mean any productfor which a federal standard of identityhas been established under 21 CFR part131 as currently in effect as of the dateof this Order.

For purposes of this Order, the term"non-dairy substitute" shall mean anyproduct which is commonly used as asubstitute for a milk product.

IIt is ordered That Presto Food

Products, Inc., its successors andassigns, and its officers, agents,representatives and employees, directlyor through any corporation, subsidiary,division or other device, in connectionwith the manufacturing, advertising,labelling, promotion, offering for sale,sale or distribution of Mocha Mix,Mocha Mix Lite or any other food, in oraffecting commerce as "commerce" isdefined in the Federal TradeCommission Act, do forthwith cease anddesist from:

A. Misrepresenting in any manner,directly or by implication, throughnumerical or descriptive terms or anyother means, the absolute orcomparative amount of total fat,saturated fat, or cholesterol in any milkproduct or any non-dairy substitute; and

B. Misrepresenting in any manner,directly or by implication, through

numerical or descriptive terms or anyother means, the existence or amount oftotal fat, saturated fat, or cholesterol inany milk product or non-dairysubstitute relative to the serving size oramount customarily consumed for anyparticular use being advertised orpromoted.

Provided, however, That nothing inprovisions A and B above shall prohibitany representation as to the amount oftotal fat, saturated fat or cholesterol inany milk product or non-dairysubstitute if such representation isspecifically permitted in labeling, forthe serving size advertised or promotedfor such product, by regulationspromulgated by the U.S. Food and DrugAdministration pursuant to the FederalFood, Drug and Cosmetic Act.

HIt is further ordered That for three (3)

years after the last date of disseminationof the representation, respondent, or itssuccessors and assigns, shall maintainand, upon request, make available to theFederal Trade Commission forinspection and copying copies of:

A. All materials that were relied uponby the respondent is disseminating anyrepresentation covered by this Order;and

B. All test reports, studies, surveys,demonstrations or other evidence in itspossession or control that contradict,qualify, or call into question anyrepresentation that is covered by thisOrder.

IIIt is further ordered That respondent

notify the Commission at least thirty(30) days prior to any proposed change,such as dissolution, assignment or saleresulting in the emergence of asuccessor corporation, the creation ordissolution of subsidiaries or any otherchanges which may affect complianceobligations arising out of the Order.IV

It is further ordered That respondentshall, within thirty (30) days afterservice upon it of this Order, distributea copy of this Order to each of itsoperating divisions, to each of itsmanagerial employees, and to each of itsofficers, agents, representatives, oremployees engaged in the preparation orplacement of advertising or othermaterial covered by this Order.

VIt is further ordered That respondent

shall, within sixty (60) days after serviceupon it of this Order and at such othertimes as the Commission may require,file with the Commission a report, in

writing, setting forth in detail themanner and form in which it hascomplied with this Order.

Analysis of Proposed Consent Order ToAid Public Comment

The Federal Trade Commission hasaccepted an agreement, subject to finalapproval, to a proposed consent orderfrom respondent Presto Food Products,Inc. ("Presto"), a California corporation.

The proposed consent order has beenplaced on the public record for sixty(60) days for reception of comments byinterested persons. Comments receivedduring this period will become part ofthe public record. After sixty (60) days,the Commission will again review theagreement and the comments receivedand will decide whether it shouldwithdraw from the agreement or makefinal the agreement's proposed order.

"aihe Commission's complaint in thismatter charges Presto with making fourfalse and misleading claims in itsadvertising of Mocha Mix and MochaMix Lite liquid non-dairy creamers.According to the complaint, Presto'sadvertisements for Mocha Mixrepresented that Mocha Mix is a lowsaturated fat product when consumed inan amount normal for use on cereal, onfruit or in cooking-uses that werepromoted in Presto advertising. Thisrepresentation is alleged to be false andmisleading, because at the serving sizecommonly consumed for these uses,Mocha Mix exceeded the then-currentstandards for a low saturated fat food.

Second, the complaint alleges thatPresto's advertisements for Mocha Mixfalsely represented that Mocha Mix islower in saturated fat than other foods,such as low-fat (1% or 2%) or wholemilk, for which it might be used as asubstitute on cereal, or fruit or incooking. In fact, the complaint alleges,Mocha Mix has over three times theamount of saturated fat per serving aslow-fat (1%) milk, over one and one halftimes the amount of saturated fat perserving as low-fat (2%) milk and aboutthe same amount of saturated fat perserving as whole milk.

Third, the complaint alleges thatPresto's advertisements for Mocha MixLite falsely represented that Mocha MixLite is a low-fat product whenconsumed in an amount normal for useon cereal, on fruit or in cooking-usesthat were promoted in Prestoadvertising. The complaint alleges that,in fact, at the serving size commonlyconsumed for these uses, Mocha MixLite exceeded the then-currentstandards for a low-fat food.

Fourth, the complaint alleges thatPresto's advertisements for Mocha MixLite represented that Mocha Mix Lite is

64956


lower in fat than other foods, such aslow-fat (1% or 2%) or whole milk, forwhich it might be used as a substituteon cereal, on fruit or in cooking. Thisrepresentation is also alleged to be falseand misleading because Mocha Mix Litehas nearly five times the amount of fatper serving as low-fat (1%) milk, nearlythree times the amount of fat per servingas low-fat (2%) milk and over one andone half times the amount of fat perserving as whole milk.

The consent order contains provisionsdesigned to remedy the violationscharged and to prevent Presto fromengaging in similar deceptive and unfairacts and practices in the future.

Part I of the order prohibits Prestofrom misrepresenting the absolute orcomparative amount of total fat,saturated fat or cholesterol in MochaMix, Mocha Mix Lite or in any othermilk product or non-dairy substitute. Amilk product is defined as any productfor which a standard of identity hasbeen established by the Food and DrugAdministration under 21 CFR part 131.A non-dairy substitute is defined, forpurposes of the order, as a productwhich is commonly used as a substitutefor a milk product. Part I also prohibitsPresto from misrepresenting the amountof total fat, saturated fat or cholesterolin Mocha Mix, Mocha Mix Lite or anyother milk product or non-dairy .substitute, relative to the serving sizebeing advertised. Finally, Part I providesthat the order shall not prohibitrepresentations as to the amount of -totalfat, saturated fat or cholesterol in a milkproduct or non-dairy substitute,provided such representation complieswith regulations of the Food and DrugAdministration for the serving sizebeing depicted in the advertising.

Part H of the order requires Presto tomaintain copies of all material relatingto advertisements covered by this orderand all documents relating tosubstantiation of advertising claimscovered by this order.

Part I requires Presto to notify theCommission of any changes in thecorporate structure that might affectcompliance with the order.

Part IV requires Presto to distributecopies of the order to certain companyofficials and employees and certainother representatives and agents of thecompany.

Part V requires Presto to file with theCommission one or more reportsdetailing compliance with the order.

All of the advertisements challengedin the Commission's complaint weredisseminated prior to January 6, 1993,the date upon which the Food and DrugAdministration ("FDA") issued its

regulations pursuant to the NutritionLabeling and Education Act.

The purpose of this analysis is tofacilitate public comment on theproposed order. It is not intended toconstitute an official interpretation oftie agreement and proposed orderor tomodify their terms in any way.Donald S. Clark,Secretary.[FR Doc. 93-30245 Filed 12-9-93; 8:45 am]BILUNG CODE 6750-01-4

[DkL C-3418]

S.C. Johnson & Son, Inc.; ProhibitedTrade Practices and AffirmativeCorrective Actions

AGENCY: Federal Trade Commission.ACTION: Modifying order.

SUMMARY: This order reopens theproceeding and modifies theCommission's 1993 consent order byremoving the requirements that therespondent hold separate and divest theinternational Renuzit assets to aCommission-approved acquirer. TheCommission concluded that the holdseparate and divestiture requirementsare imposing costs on the respondentand that there do not appear to be anycompetitive reasons to retain thedivestiture requirement.DATES: Consent Order issued March 16,1993. Modifying Order issuedNovember 8, 1993.FOR FURTHER INFORMATION CONTACT:Daniel Ducore, FTC/S-2115,Washington, DC 20580. (202) 326-2526.SUPPLEMENTARY INFORMATION: In theMatter of S.C. Johnson & Son, Inc. theprohibited trade practices and/orcorrective actions as set forth at 58 FR26140, are changed as indicated.(Sec. 6, 38 Stat. 721; 15 U.S.C. 46. Interpretor apply sec. 5, 38 Stat. 719, as amended; sec.7. 38 Stat. 731, as amended; 15 U.S.C. 45, 18)

Order Reopening Proceeding andModifying Order

Commissioners: Janet D. Steiger, Chairman,Mary L Azcuenaga, Deborah K. Owen,Roscoe B. Starek III, Dennis A. Yao.

On July 8, 1993, S.C. Johnson & Son,Inc. ("Johnson") filed a Request ToReopen and Modify Consent Order("Request") pursuant to section 5(b) ofthe Federal Trade Commission Act, 15U.S.C. 45(b), and Rule 2.51 of theCommission's Rules of Practice, 16 CFR2.51. The Request was placed on thepublic record, and the thirty-daycomment period expired on August 23,1993. No comments were received.

In the Request, Johnson asks that theCommission reopen and modify the

Order to eliminate any remainingobligation under Paragraph II to divestthe "Renuzit air freshener businessoutside the United States and all non-domestic territories or countries inNorth America, north of and includingPanama, the Caribbean and Cuba"("international Renuzit assets"). In thealternative, Johnson requests that theHold Separate Agreement ("HoldSeparate"), dated December 17, 1992,and made a part of the Order, beterminated promptly since Johnson hascompleted the sale of all of the NorthAmerican Renuzit assets.

The Order defines the "RenuzitAssets" as including all of Drackett'sright, title and interest in and to both itsair freshener products business,including the "Renuzit" brand, and itsfurniture care products business,including the "Endust" and "Behold"brands.s The Order only requiresdivestiture of the production facilitiesassociated with either air freshener orfurniture care products if desired by theacquirer. In defining the Renuzit Assets,the Order does not distinguish domesticassets from international assets nor doesit exclude the international Renuzitassets from the divestiture and holdseparate requirements. The Complaintidentified the relevant geographicmarket for continuous and instantaction airfresheners products as beingthe United States.

On May 14, 1993, the Commissionapproved Johnson's divestitures of theEndust and Behold furniture careproducts business to Sara LeeCorporation ("Sara Lee") and the NorthAmerican Renuzit air freshenerproducts business to The Dial Corp.("Dial"). As it lacked internationaloperations. Dial did not acquire theinternational Renuzit air freshenerbusiness from Johnson, and followingthe divestitures on May 18, 1993,Johnson retained the internationalRenuzit assets.

1 Paragraph l.G. of the Order states:"Renuzit Assets" means all of Drackett's rights,

title and interest in and to:(1) Air freshener products, including, but not

limited to, the brands and trademarks "Renuzit","Renuzit Adjustable", "Renuzit Roommate","Renuzit Freshell", "Renuzit Fragrance Jar","Renuzit Aerosol", and "Renuzit Fresh 'n Dry":

(2) Furniture care products, including, but notlimited to. the brands and trademarks "Endust" and"Behold", but excluding the brand and trademark'Mr. Muscle" outside the United States; and(3) All of Drackett's assets and business

associated with the development, production,distribution, and sale for resale of air freshenerproducts and furniture care products and as furtherdelineated In the subparagraphs of Schedule A,attached hereto and made a part hereof.

Part 2 of Schedule A lists assets that Johnsonneed not divest if the acquirer does not need them.See Order, Paragraph II.A.

64957

64958 Federal Register I Vol. 58, No. 236 I Friday, December 10, 1993 / Notices

Johnson asserts that reopening andmodifying the Order to eliminateJohnson's obligation to divest theremaining international Renuzit assetswill serve the public interest. Theinternational Renuzit assets, which werenot included in the divestiture to dial,consist of certain air freshener patents,trademarks, inventory and technologynecessary to market Renuzit airfreshener products outside of NorthAmerica. Johnson does not request areopening and modification on the basisof a change of fact or law. Johnsonclaims that the requested ordermodification will have no impact oncompetition in the U.S. market forcontinuous and instant action airfreshener products as defined in theComplaint. Furthermore, Johnson arguesthat the remedial purposes of the Orderhave been fully satisfied by thedivestiture of the domestic Renuzit airfreshener business to Dial.

After reviewing respondent's Request,the Commission has concluded that thepublic interest warrants reopening andmodifying the language of Schedule A,Part 2 of the Order to relieve Johnson ofany further obligation to divest theinternational Renuzit assets.2 With theelimination of any remaining divestitureobligations, the Hold Separate willterminate by its terms. Accordingly,there is no need to modify the HoldSeparate itself.

Reopening and Modifying aCommission Order

Section 5(b) of the Federal TradeCommission Act, 15 U.S.C. 45(b),provides that the Commission shallreopen an order to consider whether itshould be modified if the respondent"makes a satisfactory showing thatchanged conditions of law or fact"require such modification. Asatisfactory showing sufficient torequire such reopening is made when arequest shows that the changes

aIn the Request. Johnson also proposes to acquirefrom Dial the existing Renuzit technology andrelated information reasonably necessary forJohnson to operate the international Renuzitbusiness. The proposed acquisition covers "existingmanufacturing specifications, processspecifications, manufacturing formulas, toxicologydata and reports. safety and other regulatory data,and any machinery specifications for equipmentused to manufacture Renuzit air freshenerproducts." Request, at 4. Johnson's proposalqualifies as an acquisition of "any assets used orpreviously used * I In the manufacture orproduction of air freshener products." Order, IVI(3). Therefore, prior Commission approval Isrequired by the Order for this proposed acquisition.Because the international assets have nocompetitive significance in the domestic airfreshener market and the proposed acquisition willnot affect U.S. competition, the Commission isgiving its approval to this acquisition by separateletter.

eliminate the need for the order or makecontinued application of it inequitableor harmful to competition. Louisiana-Pacific Corp., Docket No. C-2956, Letterto John C. Hart (June 5, 1986), at 4.3

The Commission may modify an orderwhen, although changed circumstanceswould not require reopening, theCommission determines that the publicinterest requires such action. Id.Therefore, Section 2.51 of theCommission's Rules of Practice invitesrespondents in petitions to reopen toshow how the public interest warrantsthe requested modification. In the caseof a request for modification based onpublic interest grounds, a petitionermust demonstrate as a threshold mattersome affirmative need to modify theorder. See Damon Corp., Docket No.G-2916, Letter to Joel E. Hoffman, Esq.,(March 29, 1983) (unpublished), at 2. Ifthe showing of need is made, theCommission will balance the reasonsfavoring the requested modificationagainst any reasons not to make themodification. Id. The Commission willalso consider whether the particularmodification sought is appropriate toremedy the identified harm.

Whether the request to reopen isbased on changed conditions or onpublic interest considerations, theburden is on the respondent to make therequisite satisfactory showing. Thelanguage of Section 5(b) plainlyanticipates that the petitioner mustmake a "satisfactory showing" ofchanged conditions to obtain reopeningof the order. The legislative history alsomakes it clear that the petitioner has theburden of showing, other than byconclusory statements, why an ordershould be modified.4 If the Commissiondetermines that the petitioner has madethe required showing, the Commissionmust reopen the order to considerwhether modification is required and, ifso, the nature and extent of themodification. The Commission is notrequired to reopen the order, however,if petitioner fails to meet its burden ofmaking the satisfactory showingrequired by the statute. The petitioner'sburden is not a light one given the

3 G. United States v. Louisiana-Pacific Corp., 967F. 2d 1372, 1376-77 (9th Cir. 1992), where the courtnoted that "[a] decision to reopen does notnecessarily entail a decision to modify the order.Reopening may occur even where the petition itselfdoes not plead facts requiring modification." Id.

4 The Commission may properly decline toreopen an order if the request is "merely conclusoryor otherwise fails to set forth specific factsdemonstrating In detail the nature of the changedconditions and the reason why these changedconditions require the requested modification of theorder." S. Rap. No. 96-500, 96th Con&, 1st Sass. 9-10 (1979). See also Rule 2.51(b), which requiresrespondents to submit affidavits in support ofpetitions to reorien and modify.

public interest in repose and the finalityof Commission orders.s

The Order Should be Reopened andModified

Johnson has shown that publicinterest considerations warrantreopening and modifying the Order toremove its obligations to divest theinternational Renuzit assets and abideby the Hold Separate.6 Johnson appearsto have met its burden of showing athreshold injury caused by thecontinued operation of the Order.Johnson claims that in view of thedivestiture to Dial of the NorthAmerican Renuzit assets, of Dial's lackof interest in acquiring the internationalRenuzit assets and of the allegation inthe Complaint that the relevantgeographic market is the United States,the requirement of the Order thatJohnson hold the international Renuzitassets separate and divest them iscausing it unforeseen harm and havinga negative impact on Johnson's ability tocompete. Johnson also asserts that thereis an affirmative need to release it fromits obligation to divest these assets inorder to remove the impediment tocompetition. Johnson argues that sinceit has completed the divestitures ofsubstantially all of the Renuzit Assets,the Hold Separate has already achievedits purpose and the continuing harmfrom its application was notcontemplated by the Order.

In T&Nplc, Docket No. C-3312(November 6, 1991), the Commissionfound that respondent demonstrated anaffirmative need to modify the order byshowing that requiring T&N to divestremaining inventory not wanted by theacquirer could create an impediment toT&N's ability to compete effectively.The Commission further found that T&Ndemonstrated that the continuedapplication of the hold separaterequirements to the remaining inventoryimposed considerable costs onrespondent's operations and limited itsability to respond tochanges in themarket. In Chevron Corp., Docket No. C-3147, 105 F.T.C. 228 (1985), theCommission held that the costsassociated with continuing a holdseparate agreement after a respondenthas complied substantially with thedivestiture requirements of the order arerelevant in determining whether toreopen and modify an order on publicinterest grounds. The continued coststhat Johnson will incur by the continued

5 See Federated Department Stores, Inc. v. Moitie,425 U.S. 394 (1981) (strong public Interestconsiderations support repose and finality).

s As previously noted. Johnson does not requesta reopening and modification on the basis of achange of law or fact.

10, 1993 / Notices64958 Federal Register / Vol. 58, No. 236 / Friday, December


application of the divestiture and holdseparate requirements of the Ordercompare closely to the costs that theCommission recognized as the thresholdinjury showings in T&N and Chevron.

There appears to be no reason toretain the requirement that Johnsondivest the international Renuzit assets.*Because Johnson has completed thedivestiture of the North AmericanRenuzit air freshener assets to Dial, theremedial purposes of the Order havebeen fully accomplished. TheComplaint identified the relevantgeographic market in this matter as theUnited States, and the divestiture toDial of the domestic Renuzit businesscompletely cured the competitiveconcerns raised by the Complaint andOrder. The international Renuzitbusiness appears to have no effect oncompetition in the U.S. air freshenermarket. No imports of internationalRenuzit products occur in NorthAmerica. Thus, there is no need, basedon domestic competitive concerns, torequire Johnson to divest theinternational Renuzit assets.

Balancing the reasons favoring therequested modification against anyreason not to make the modificationjustifies modifying the Order in the'public interest. The harm and costs toJohnson associated with the continuingdivestiture and hold separaterequirements seem significant. On theother hand, it does not appear that therewould be any benefits to domesticcompetition from retaining therequirement to divest the internationalassets. Where the potential harm to therespondent outweighs any further needfor the order, the Commission maymodify the order in the public interestto allow the respondent to retain therelevant assets.'

In conclusion, Johnson has made asufficient showing that public interestconsiderations support its Request thatthe Commission reopen and modify theOrder to remove the requirements thatit hold separate and divest theinternational Renuzit assets. The holdseparate and divestiture requirements

7 In T&N, supro, the Commission modified thedivestiture requirements of the order to permit therespondent to retain inventory not wanted by theacquirer. In Chevron. supra. the Commissionreopened and modified the order to eliminate thehold separate requirement after the respondent hadcompleted the majority of the divestitures requiredby the order. In Botus. Inc.. Docket No. C-3099. 104F.T.C. 632 (19a4), the Commission modified theorder to excuse the respondent, which had beenordered to divest department stores sufficient toreduce its sales volume by $20 million, fromdivesting any additional department stores. Therespondent had received Commission approval fordivestitures totaling $17.9 million in sales volume.and the Commission determined that requiring anadditional divestiture was unnecessary.

are imposing costs on Johnson.Moreover, there do not appear to be anycompetitive reasons to retain thedivestiture requirement.

Accordingly, It is ordered, That theproceeding be, and it hereby is,reopened for the purpose of modifyingthe Order entered therein;

It is further ordered, That Schedule A,Part 2 of the Order be, and hereby is,modified by including the followingparagraph:

(6) the international Renuzit assets, whichare comprised of the air freshener patents,trademarks, inventory and technologyreasonably necessary to produce Renuzit airfreshener products for sale outside of theUnited States and all non-domestic territoriesor countries in North America. north of andincluding Panama, the Caribbean and Cuba.

By the Commission.Donald S. Clark,Secretary..

Concurring Statement of CommissionerRoscoe B. Starek, HI

In the Matter of S.C. Johnson & Son, Inc.Docket No. C-3418.

Because of its successful effort tofulfill the core obligations in the Order,the respondent's obligation to divest theinternational Renuzit assets becameextremely difficult and costly. Were thisobligation intended by the Commissionas fencing-in relief, or were it to supportthe core relief in the Order in any way.the removal of that obligation would notbe warranted by the respondent'spetition. But because I am not aware ofany remedial purpose served by thisobligation, the considerable costs that itappears to impose on the respondentjustify its removal. Accordingly. Iconcur in the decision to modify theOrder.[FR Doc. 93-30246 Filed 12-9-93; 8:45 am]BILUNG CODE 6750-41-M

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

National Institutes of Health

Meeting of the National Deafness andOther Communication DisordersAdvisory Board

Pursuant to Public Law 92-463,notice is hereby given of the meeting ofthe National Deafness and OtherCommunication Disorders AdvisoryBoard on January 7, 1994. The meetingwill take place from 8:30 a.m. to 4: 30p.m. in Conference Room 10, Building31C, National Institutes of Health, 9000Rockville Pike, Bethesda, Maryland20892.

The meeting, which will be open tothe public, is being held to discuss theBoard's activities and to present specialreports. Attendance by the public willbe limited to the space available.

Summaries of the Board's meetingand a roster of members may beobtained from Ms. Monica Davies,Executive Director, National Deafnessand Other Communication DisordersAdvisory Board, Building 31, room3C08, National Institutes of Health,Bethesda. Maryland 20892, 301-402-1129, upon request.

Individuals who plan to attend andneed special assistance, such as signlanguage interpretation or otherreasonable accommodations, shouldcontact the Executive Director inadvance of the meeting.(Catalog of Federal Domestic AssistanceProgram No. 93.173, Biological ResearchRelated to Deafness and CommunicationDisorders.)

Dated: December 6, 1993.Susan K. Feldman.Committee Management Officer, NIH.[FR Doc. 93-30269 Filed 12-9-93; 8:45 am]BILUNG CODE 4140-01-M

Meeting of the National AdvisoryCouncil for Human Genome Research

Pursuant to Public Law 92-463,notice is hereby given of the meeting ofthe National Advisory Council forHuman Genome Research, NationalCenter for Human Genome Research,January 24-25, 1994, in Chevy Chase Iand II at the Embassy Suites Hotel, 4300Military Road, Wisconsin at WesternAvenue, Washington, DC.

This meeting will be open to thepublic on January 24, 1994, from 8:30a.m. to 10:30 am. to discussadministrative details or other issuesrelating to committee activities.Attendance by the public will be limitedto space available.

In accordance with the provisions setforth in sections 552b(c)(4) and552b(c)(6), Title 5, U.S.C. and section10(d) of Public Law 92-463, the meetingwill be closed to the public on January24 at 10:30 a.m. to recess and on January25 from 8:30 a.m. to adjournment, forthe review, discussion and evaluation ofindividual grant applications. The .applications and the discussions couldreveal confidential trade secrets orcommercial property such as patentablematerial, and personal informationconcerning individuals associated withapplications, the disclosure of whichwould constitute a clearly unwarrantedinvasion of personal privacy.

Dr. Elke Jordan, Deputy Director,National Center for Human Genome

64959

Federal Register I. Vol. 58, No. 236 / Friday, December 10, 1993 / Notices

Research, National Institutes of Health,Building 38A, room 605, Bethesda,Maryland 20892, (301) 496-0844, willfurnish the meeting agenda, rosters ofCommittee members and consultants,and substantive program informationupon request. Individuals who plan toattend and need special assistance, suchas sign language interpretation or otherreasonable accommodations, shouldcontact Ms. Jane Ades, (301) 402-2205,two weeks in advance of the meeting.

(Catalogue of Federal Domestic AssistanceProgram No. 93.172, Human GenomeResearch.)

Dated: December 6, 1993.

Susan K. Feldman,Committee Management Officer, NIH.[FR Doc. 93-30268 Filed 12-9-93; 8:45 am)BILLING CODE 4140-01-M

Prospective Grant of ExclusiveLicense; Conocurvone as an AntiviralAgent Useful In the Treatment ofAcquired Immunodeficiency Syndrome(AIDS)

AGENCY: National Institutes of Health,Public Health Service, DHHS.ACTION: Notice.

SUMMARY: This is notice in accordancewith 15 U.S.C. 209(c)(1) and 37 CFR404.7(a)(1)(i) that the National Institutesof Health (NIH), Department of Healthand Human Services, is contemplatingthe grant of an exclusive world-widelicense to practice the inventionembodied in U.S. Patent Application SN08/011,183 entitled "AntiviralNaphthoquinone Compounds,Compositions and Uses Thereof" andrelated foreign patent applications toAMRAD Corporation, Limited of Kew,Victoria, Australia. The patent rights inthis invention have been assigned to theUnited States of America.

The prospective exclusive license willbe royalty-bearing and will comply withthe terms and conditions of 35 U.S.C.209 and 37 CFR 404.7. It is anticipatedthat this license may be limited to thefield of treatment of viral infection inboth humans and animals. Thisprospective exclusive license may begranted unless within 60 days from thedate of this published notice, NIHreceives written evidence and argumentthat establishes that the grant of thelicense would not be consistent with therequirements of 35 U.S.C. 209 and 37CFR 404.7.

The patent application describesconocurvone and other novel antiviralnaphthoquinone compounds which maybe isolated from plants of the genusConospermum or synthesizedchemically. These compounds or

derivatives may be used alone or incombination with other antiviral agentsin compositions to inhibit the growth orreplication of viruses, particularly HIV-I or HIV-2, in the treatment orprevention of viral infection.ADDRESSES: Requests for a copy of thispatent application, inquiries, commentsand other materials relating to thecontemplated license should be directedto: Steven M. Ferguson, TechnologyLicensing Specialist, Office ofTechnology Transfer, National Institutesof Health, Box OTT, Bethesda, MD20892. Telephone: (301) 496-7735;Facsimile: (301) 402-0220.

Applications for a license filed inresponse to this notice will be treated asobjections to the grant of thecontemplated license. Only writtencomments and/or applications for alicense which are received by NIHwithin sixty (60) days of this notice willbe considered. A signed ConfidentialDisclosure Agreement will be requiredto receive a copy of the patentapplication.

Dated: December 2, 1993.Donald P. Christoferson,Acting Director, Office of TechnologyTransfer.[FR Doc. 93-30267 Filed 12-9-93; 8:45 am]BILUNG CODE 4140.41-U

National Institutes of Health; Division

of Research Grants

Meeting

Pursuant to Public Law 92-463,notice is hereby given of a meeting ofthe Division of Research GrantsBehavioral and Neurosciences SpecialEmphasis Panel.

The meeting will be closed inaccordance with the provisions set forthin section 552b(c)(4) and 552b(c)(6), title5, U.S.C. and section 10(d) of PublicLaw 92-463, for the review, discussionand evaluation of individual grantapplications in the various areas anddisciplines related to behavior andneuroscience. These applications andthe discussions could revealconfidential trade secrets or commercialproperty such as patentable materialand personal information concerningindividuals associated with theapplications, the disclosure of whichwould constitute a clearly unwarrantedinvasion of personal privacy.

The Office Of CommitteeManagement, Division of ResearchGrants, Westwood Building, NationalInstitutes of Health, Bethesda, Maryland20892, telephone 301-594-7265, willfurnish summaries of the meeting androster of panel members.

Meeting to Review Individual GrantApplications

Scientific Review Administrator: Dr.Joe Marwah (301) 594-7158.

Date of Meeting: December 14, 1993.Place of Meeting: Westwood Bldg, Rm

303, NIH, Bethesda, MD (TelephoneConference).

Time of Meeting: 2 p.m.This notice is being published less

than 15 days prior to the meeting dueto the difficulty of coordinating theattendance of members because ofconflicting schedules.(Catalog of Federal Domestic AssistanceProgram Nos. 93.306, 93.333, 93.337, 93.393-93.396, 93.837-93.844, 93.846-93.878,93.892, 93.893, National Institutes of Health,HHS)

Dated: December 7, 1993.Susan K. Feldman,Committee Management Officer, NIH.[FR Doc. 93-30375 Filed 12-9-93; 8:45 am]BILUNG CODE 4140-01-M

DEPARTMENT OF HOUSING ANDURBAN DEVELOPMENT

Office of the Assistant Secretary forCommunity Planning andDevelopment[Docket No. N-03-1917; FR-3350-N-611

Federal Property Suitable as Facilitiesto Assist the Homeless

AGENCY: Office of the AssistantSecretary for Community Planning andDevelopment, HUD.ACTION: Notice.

SUMMARY: This Notice identifiesunutilized, underutilized, excess, andsurplus Federal property reviewed byHUD for suitability for possible use toassist the homeless.ADDRESSES: For further information,contact Mark Johnston, room 7262,Department of Housing and UrbanDevelopment, 451 Seventh Street SW,Washington, DC 20410; telephone (202)708-4300; TDD number for the hearing-and speech-impaired (202) 708-2565(these telephone numbers are not toll-free), or call the toll-free Title Vinformation line at 1-800-927-7588.SUPPLEMENTARY INFORMATION: Inaccordance with 56 FR 23789 (May 24,1991) and section 501 of the Stewart B.McKinney Homeless Assistance Act (42U.S.C. 11411), as amended, HUD ispublishing this Notice to identifyFederal buildings and other realproperty that HUD has reviewed forsuitability for use to assist the homeless.The properties were reviewed usinginformation provided to HUD by

64960


Federal landholding agencies regardingunutilized and underutilized buildingsand real property controlled by suchagencies or by GSA regarding itsinventory of excess or surplus Federalproperty. This Notice is also publishedin order to comply with the December12, 1988 Court Order in NationalCoalition for the Homeless v. VeteransAdministration, No. 88-2503-OG(D.D.C.).

Properties reviewed are listed in thisNotice according to the followingcategories: Suitable/available, suitable/unavailable, suitable/to be excess, andunsuitable. The properties listed in thethree suitable categories have beenreviewed by the landholding agencies,and each agency has transmitted toHUD- (1) Its intention to make theproperty available for use to assist thehomeless, (2) its intention to declare theproperty excess to the agency's needs, or(3) a statement of the reasons that theproperty cannot be declared excess ormade available for use as facilities toassist the homeless.

Properties listed as suitable/availablewill be available exclusively forhomeless use for a period of 60 daysfrom the date of this Notice. Homelessassistance providers interested-in anysuch property should send a writtenexpression of interest to HHS, addressedto Judy Breitman, Division of HealthFacilities Planning, U.S. Public HealthService, HHS, room 17A-10, 5600Fishers Lane, Rockville, MD 20857;(301) 443-2265. (This is not a toll-freenumber.) HHS will mail to theinterested provider an applicationpacket, which will include instructionsfor completing the application. In orderto maximize the opportunity to utilize asuitable property, providers shouldsubmit their written expressions ofinterest as soon as possible. Forcomplete details concerning theprocessing of applications, the reader isencouraged to refer to the interim rulegoverning this program, 56 FR 23789(May 24, 1991).

For properties listed as suitable/to be-excess, that property may, ifsubsequently accepted.as excess byGSA, be made available for use by thehomeless in accordance with applicablelaw, subject to screening for otherFederal use. At the appropriate time,HUD will publish the property in aNotice showing it as either suitable/available or suitable/unavailable.

For properties listed as suitable/unavailable, the landholding agency hasdecided that the property cannot bedeclared excess or made available foruse to assist the homeless, and theproperty will not be available.

Properties listed as unsuitable willnot be made available for any otherpurpose for 20 days from the date of thisNotice. Homeless assistance providersinterested in a review by HUD of thedetermination of unsuitability shouldcall the toll free information line at 1-800-927-7588 for detailed instructionsor write a letter to Mark Johnston at theaddress listed at the beginning of thisNotice. Included in the request forreview should be the property address(including zip code), the date ofpublication in the Federal Register, thelandholding agency, and the propertynumber.

For more information regardingparticular properties identified in thisNotice (i.e., acreage, floor plan, existingsanitary facilities, exact street address),providers should contact theappropriate landholding agencies at thefollowing addresses: U.S. Navy: John J.Kane. Deputy Division Director. Dept. ofNavy, Real Estate Operations, NavalFacilities Engineering Command, 200Stovall Street, Alexandria, VA 22332-2300; (703) 325-0474; U.S. Air Force:John Carr, Realty Specialist, HQ-AFBDA/BDR, Pentagon, Washington,DC 20330-5130; (703) 696-5569; GSA:Leslie Carrington, Federal PropertyResources Services, GSA, 18th and FStreets NW, Washington, DC 20405;(202) 208-0619; Dept: ofTransportdtion: Ronald D. Keefer,Director, Administrative Services &Property Management, DOT, 400Seventh St. SW, room 10319,Washington, DC 20590; (202) 366-4246;Dept. of Interior: Lola D. Knight,Property Management Specialist, Dept.of Interior, 1849 C St. NW, Mailstop5512-MIB, Washington, DC 20240; (202)208-4080; (These are not toll-freenumbers).

Dated: December 3, 1993.Jacquie M. Lawing,Deputy Assistant Secretary for EconomicDevelopment.

Title V, Federal Surplus Property ProgramFederal Register Report for 12/10/93

Suitable/Available Properties

Land (by State)Mississippi

Jackson Installation WaterwayLoflin StreetJackson Co: Hinds MS 39209-Landholding Agency: GSAProperty Number. 549340002Status: ExcessComment: 34.88 acres, gas pipeline runs

along eastern boundary, property isirregularly shaped, backs to a highway

GSA Number: 4-GR(1)-MS-478B

WashingtonAsotin Quarry-Lower Lock & Dam

West of Upriver RoadAsotin Co: Asotin WA 99402-Landholding Agency: GSAProperty Number: 549340001Status: ExcessComment: 39.42 acres, access easement, most

recent use-rock quarryGSA Number: 9-D-WA-824K

Suitable/Unavailable Properties

Land (by State)ArizonaLand--640 acresAve. B--County 23 St.Yuma Co: Yuma AZ 85364-Landholding Agency: InteriorProperty Number- 619340001Status: UnutilizedComment: desert land, currently no water

available, possible lease restrictionsTract No. APO-SRP-JL-4West of 91st Ave. & South of Indian School

Rd Co: Maricopa AZLandholding Agency: InteriorProperty Number: 619340002Status: UnutilizedComment: 26 foot strip of land 800 foot'long,

possible easement restrictions

Unsuitable Properties

Buildings (by State)CaliforniaBldg. M-155Mare Island Naval ShipyardSan Pablo and Suisun AvenuesVallejo Co: Solano CA 94592-Landholding Agency: NavyProperty Number: 779340002Status: UnutilizedReason: Secured AreaBldg. 31104Naval Air Weapons StationChina Lake Co: San Bernardino CA 93555-Landholding Agency: NavyProperty Number. 779340003Status: UnutilizedReason: Secured AreaFlorida1600 Family Housing UnitsHomestead Air Force BaseMiami Co: Dade FL 33218-0001Landholding Agency: Air Force-BCProperty Number. 199340002Status: ExcessBase closure Number of Units: 1600Reason: Floodway; OtherComment: Extensive Deterioration9 Industrial Storage Bldgs.Homestead Air Force BaseMiami Co: Dade FL 33218-0001Landholding Agency: Air Force-BCProperty Number. 199340003Status: ExcessBase closure Number of Units: 9Reason: Floodway17 Administrative Bldgs.Homestead Air Force BaseMiami Co: Dade FL 33218-0001Landholding Agency: Air Force-BCProperty Number. 199340004Status: ExcessBase closure Number of Units: 17Reason: Floodway

64961


13 DnrmitoriesHomestead Air Force BaseMiami Co: Dade FL 33218-0001Landholding Agency: Air Force-BCProperty Number. 199340005Status: ExcessBase closure Number of Units: 13Reason: Floodway9 Miscellaneous Bldgs.Homestead Air Force BaseMiami Co: Dade FL 33218-O001Landholding Agency: Air Force-BCProperty Number- 199340006Status: ExcessBase closure Number of Units: 9Reason: Floodway8 Recreational FacilitiesHomestead Air Force BaseMiami Co: Dade FL 33218-0001Landholding Agency: Air Force-BCProperty Number: 199340007Status: ExcessBase closure Number of Units: 8Reason: Floodway6 WarehousesHomestead Air Force BaseMiami Co: Dade FL 33218-0001Landholding Agency: Air Force-BCProperty Number: 199340008Status: ExcessBase closure Number of Units: 6Reason: FloodwayHawaiiKahoolawe SW Point LightKahoolawe Island Co: Maui HILandholding Agency: DOTProperty Number: 879340003Status: UnderutilizedReason: OtherComment: InaccessibleMaineBldg. 384Naval Air Station TopshamBrunswick Co: Sagadahoc MELandholding Agency: NavyProperty Number. 779340001Status: UnutilizedReason: OtherComment: Extensive DeteriorationMississippiNatchez Moorings82 L.E. Berry RoadNatchez C: Adams MS 39121-Landholding Agency: DOTProperty Number. 879340002Status: UnutilizedReason: OtherComment: Extensive DeteriorationNorth CarolinaBldg. 54Group Cape HatterasBuston Co: Dare NC 27902-0604Landholding Agency: DOTProperty Number 879340004Status: UnutilizedReason: Secured AreaBldg. 83Group Cape HatterasBuxton Co: Dare NC 27902-0604Landholding Agency: DOTProperty Number: 879340005Status: UnutilizedReason: Secured Area

Water TanksGroup Cape HatterasBuxton Co: Dare NC 27902-0604Landholding Agency: DOTProperty Number: 879340006Status: UnutilizedReason: Secured Area

Land (by State)

Florida

LandHomestead Air Force BaseMiami Co: Dade FL 33218-0001Landholding Agency: Air Force-BCProperty Number: 199340001Status: ExcessBase closure Number of Units: IReason: Floodway

[FR Dec. 93-30061 Filed 12-9-93; 8:45 a.m.]BILUNG CODE 4210---F



Meeting

AGENCY: Office of the Secretary, Interior.

SUMMARY: The Department of theInterior announces a public meeting ofthe Exxon Valdez Oil Spill PublicAdvisory Group to be held on Tuesdayand Wednesday, January 11 and 12,1994, at 9:30 a.m., in the first conferenceroom, 645 "G" Street, Anchorage,Alaska.

FOR FURTHER INFORMATION CONTACT:Douglas Mutter, Department of theInterior, Office of EnvironmentalAffairs, 1689 "C" Street, suite 119,Anchorage, Alaska (907) 271-5011.

SUPPLEMENTARY INFORMATION: ThePublic Advisory Group was created byParagraph V.A.4 of the Memorandum ofAgreement and Consent Decree enteredinto the United States of America andthe State of Alaska on August 27, 1991,and approved by the United StatesDistrict Court for the District of Alaska .in settlement of United States ofAmerica v. State of Alaska, Civil ActionNo. A91-081 CV. The agenda willinclude status reports on restorationactivities and a review of the proposed1994 restoration Work Plan.

Dated: December 6, 1993.Jonathan P. Deason,Director, Office of Environmental Policy andCompliance.[FR Dec. 93-30238 Filed 12-9-93; 8:45 am)BILUNO CODE 4310-RG-

Bureau of Land Management

[OR-030-04-4410-01: G4-040]

Availability of EnvironmentalAssessment for the Leslie Gulch Areaof Critical Environmental Concern(ACEC) Draft Amendment of theNorthern Malheur ManagementFramework Plan and Draft ACECManagement Plan

AGENCY: Vale District, Bureau of LandManagement, Interior.ACTION: Notice of availability.

SUMMARY: An EnvironmentalAssessment (EA) has been prepared andis available for the proposal to amendthe Northern Malheur ManagementFramework Plan in relation to the LeslieGulch Area of Critical EnvironmentalConcern (ACEC). The issues are relatedto inholding acquisition, livestockgrazing, mineral development and wildhorses as they pertain to management ofthe relevant and important values of theACEC.

The 11,900 acre Leslie Gulch ACEC islocated 50 miles south of Ontario,Oregon and adjoins the east side of theOwyhee Reservoir.

The EA is available for public reviewupon request for 45 days from the dateof this notice. This EA and publiccomment will be used to refine theissues and develop a proposedamendment. The proposed decisionincorporating public comments shouldbe available for public review in March1994. A final decision is expected inJune 1994 after a 30 day protest periodand 60 day state and local governmentconsistency review of the proposeddecision. It is not anticipated there willbe any public meetings or hearings, allcomments are expected to be in writing.

Any one interested in participatingduring the public review process of thisplanning amendment may participate byrequesting to be added to the mailinglist.FOR FURTHER INFORMATION CONTACT:Ralph Heft, Malheur Resource AreaManager, Bureau of Land Management,Vale District, 100 Oregon street, Vale,OR 97918, (Telephone 503 473-3144).Vicki E. Hamel,Assistant District Manager, Administration.[FR Dec. 93-30162 Filed 12-0-93; 8:45 am]BILUNG COOE 4310.43-U

(CA-010-4210-03; CACA 31350PT]

Realty Action; Exchange of PublicLands, California

AGENCY: Bureau of Land Management,Interior.

64962


ACTION: Notice of realty action, exchangeof public and private lands in Tehamaand Mono Counties, California.

SUMMARY: The following describedpublic lands are being considered forexchange to the Trust for Public Landunder section 206 of the Federal LandPolicy and Management Act of October21, 1976, 43 U.S.C. 1716.

Note: Not all the land identified below willbe included in the exchange. Some parcelsmay be deleted to eliminate possible conflictsthat could arise during processing.

Additional public lands in TehamaCounty, California previously identifiedfor exchange to The Trust for PublicLand and published in the FederalRegister on July 31, 1992 Vol. 57 No.148 page 33969 and identified by SerialNo. CACA 30080.may also be includedin the exchange. The final selection ofproperties will be made to achievecomparable values between the offeredand selected lands.

Selected Public Lands: The followingparcels are identified for exchange ofonly the surface estate:

Mount Diablo Meridian, CaliforniaT. 3 S., R. 32 E.,

Sec. 2; W1/2SW1/4. SEI/4SW1/4Sec. 3; E/.SEI/4, SE/4. E /NWASE4SE/4Sec. 10; E,/kNEI4NE14NEI/4Sec. 11; NWI/JNW A, E ASW ANW/4,

E,/iNW /SWANW/4.E ANEI4NWIASW/4

Sec. 25; EE/zComprising approximately 400 acres in

Mono County, California.

In exchange for these lands, theUnited States will acquire non-federallands in Mono County from The Trustfor Public Land described as follows:

Mount Diablo Meridian, CaliforniaT. 3 N., R. 25 E.,

Sec. 4; E W h, SWI/4SW'/4Sec. 9; NW/4NW/4Comprising approximately 240 acres in

Mono County, California.DATES: The publication of this notice inthe Federal Register will segregate thepublic lands described above to theextent that they will not be subject toappropriation under the public landlaws, including the mining laws. Anysubsequently tendered application,allowance of which is discretionary,shall not be accepted, shall not beconsidered as filed, and shall bereturned to the applicant. Thesegregative effect shall terminate asprovided by 43 CFR 2201.1 (b).ADDRESSES: Detailed informationconcerning the exchange is available forreview at the Bishop Resource AreaOffice, 787 N. Main St. suite P, Bishop,California 93514 or by contacting LarryPrimosch at (619) 872-4881.

SUPPLEMENTARY INFORMATION: Thepurpose of this exchange is to improvethe resource management programs ofthe Bureau of Land Managementthrough consolidation of ownership andto benefit the public interest byobtaining important resource values.The public lands to be exchanged areparcels identified by the Bureau's landuse plans as unmanageable due toisolation from other Bureauadministered public lanos or identifiedfor disposal for community expansionor agricultural use. The private lands tobe exchanged have recreation, wildlife,fisheries, and forestry values that meritacquisition into public ownership. Theexchange is consistent with the Bureau'sland use plans and the public interestwill be well served by the exchange.Final determination on disposal willawait completion of an environmentalanalysis and compilation of furtherinformation. The value of the lands tobe exchanged will be approximatelyequal. The federal acreage will bereduced and/or the proponent will makecash payment to equalize values uponcompletion of final appraisals of thelands. Lands to be transferred from theUnited States will be subject to thefollowing reservations:

1. A reservation of the United Statesof a right-of-way for.ditches and canalsconstructed by authority of the UnitedStates under the Act of August 30, 1890(43 U.S.C. 945).

2. Valid existing rights, including anyright-of-way, easement, permit, or leaseof record.

3. Grazing operations that will havetheir allotments affected by thisexchange are entitled to a 2-yearadjustment period. However, apermittee may waive this 2-year notice.

Lands to be acquired by the UnitedStates will be subject to valid existingrights of record.

Comments

For a period of 45 days from the dateof publication of this notice, interestedparties may submit comments to theDistrict Manager, Bakersfield DistrictOffice, Bureau of Land Management,800 Truxton Ave., room 311,Bakersfield, California 93301.Objections will be evaluated by theState Director who may sustain, vacate,or modify this realty action. In theabsence of any objections, this realtyaction will become the finaldetermination of the Department of theInterior.

Dated: December 3, 1993.Genivieve D. Rasmussen,Area Manager, Bishop Resource Area.[FR Doc. 93-30195 Filed 12-9-93; 8:45 am]SILUNG CODE 4310-4"-M


Availability of a Draft Recovery Planfor the Large-Flowered Fiddleneck(Amsinckla Grandiflora) for Reviewand Comment

AGENCY: Fish and Wildlife Service,Interior.ACTION: Notice of document availability.

SUMMARY: The U.S. Fish and WildlifeService (Service) announces theavailability for public review of a draftrecovery plan for the large-floweredfiddleneck (Amsinckia grandiflora).This species occurs on public andprivate lands In California in Alameda,Contra Costa and San Joaquin Counties.The Service solicits review andcomment from the public on this draftplan.DATES: Comments on the draft recoveryplan must be received on or beforeFebruary 8, 1994, to receiveconsideration by the Service.ADDRESSES: Persons wishing to reviewthe draft recovery may obtain a copy bycontacting the Field Supervisor,Sacramento Field Office, U.S. Fish andWildlife Service, 2800 Cottage Way,room E-1803, Sacramento, California95825-1846 or by calling (916) 978-4866. Written comments and materialsregarding the draft recovery plan shouldbe addressed to Field Supervisor,Sacramento Field Office, U.S. Fish andWildlife Service at the address listedabove. Comments and materialsreceived are available on request forpublic inspection, by appointment,during normal business hours at theabove address.FOR FURTHER INFORMATION CONTACT:Kirsten Tarp at the above address(telephone 916/978-4866).


Background

Restoring an endangered orthreatened animal or plant to the pointwhere it is again a secure, self-sustaining member of its ecosystem is aprimary goal of the U.S. Fish andWildlife Service's endangered speciesprogram. To help guide the recoveryeffort, the Service is working to preparerecovery plans for most of the listedspecies native to the United States.Recovery plans describe actionsconsidered necessary for conservation of

.64963


the species, establish criteria for therecovery levels for downlisting anddelisting species, and estimate time andcost for implementing the recoverymeasures needed.

The Endangered Species Act of 1973(Act) as amended (16 U.S.C. 1531 etseq.) requires the development ofrecovery plans for listed species unlesssuch a plan would not promote theconservation of a particular species.Section 4(f) of the Act, as amended in1988, requires that public notice and anopportunity for public review andcomment be provided during recoveryplan development. The Service willconsider all information presentedduring a public comment period prior toapproval of each new or revisedRecovery Plan. The Service and otherFederal agencies will also take thesecomments into account in the course ofimplementing approved recovery plans.

Historically known from a fewlocations in the northern Diablo Range,part of the Inner South Coast Range ofCalifornia, natural populations of thelarge-flowcred fiddleneck are currentlyrestricted to western San Joaquin andeastern Alameda Counties.Reintroductions have been made in SanJoaquin and Contra Costa Counties.Critically low numbers of individualsdue to the loss of habitat fromurbanization and agriculturalconversion, and live-stock grazing,environmental and genetic stochasticity,and competition or interference fromassociated plants (mostly non-nativeweeds) imminently threaten thecontinued existence of the large-flowered fiddleneck. The primaryobjectives of the draft recovery plan areto stabilize the long-term status andensure the viability of the species in thewild, thereby enabling the large-flowered fiddleneck to be downlisted.

Public Comments Solicited

The Service solicits written commentson the recovery plan described. Allcomments received by the date specifiedwill be considered prior to approval ofthe plan.

Authority: The authority for this action issection 4(f) of the Endangered Species Act,16 U.S.C. 1533(f).

Dated: December 3, 1993.David L. McMullen,Acting Regional Director, U.S. Fish andWildlife Service, Region 1.IFR Doc. 93-30194 Filed 12-9-93; 8:45 am]BILUNG CODE 4310-GO-M

Minerals Management Service

Outer Continental Shelf, Alaska, Gasand Oil Lease Sale 144AGENCY: Minerals Management Service(MMS), Interior.ACTION: Call for Information andNominations and Notice of Intent (Call/NOT) to Prepare an EnvironmentalImpact Statement (EIS).

1. Authority. This Call/NOI ispublished pursuant to the OuterContinental Shelf (OCS) Lands Act (43U.S.C. 1331-1356, (1988)), and theregulations issued thereunder (30 CFRpart 256).

2. Purpose of Call. The purpose of theCall is to gather information forproposed OCS Lease Sale 144. Thisproposed sale, located in the BeaufortSea Planning Area, is tentativelyscheduled for December 1996.

Information and nominations on oiland gas leasing, exploration anddevelopment and production within theBeaufort Sea Planning Area are soughtfrom all interested parties. This earlyplanning and consultation step is part ofthe Area Evaluation and DecisionProcess and is important for ensuringthat all interests and concerns arecommunicated to the Department of theInterior for future decisions in theleasing process pursuant to the OCSLands Act, as amended (43 U.S.C. 1331-1356) (1988), and regulations at 30 CFRpart 256. This Call does not indicate apreliminary decision to lease in the areadescribed below. Final delineation ofthe area for possible leasing will bemade at a later date and in compliancewith all applicable laws includingrequirements of the NationalEnvironmental Policy Act (42 U.S.C.4321 et seq.), as amended, and withestablished departmental procedures.

3. Description of Area. The area ofthis Call, located offshore the State ofAlaska in the Beaufort Sea PlanningArea as identified on the attached map,extends offshore from around 3 miles toapproximately 140 miles, in waterdepths from around 7 feet to 10,000 feet.The area available for nominations andcomments consists of approximately5,420 whole and partial blocks (about29.5 million acres). Respondents maynominate and are asked to comment onany acreage within the entire Call area.A large scale map of the Beaufort SeaPlanning Area (hereinafter referred to asthe Call map) showing boundaries of thearea on a block-by-block basis and acomplete list of Official ProtractionDiagrams (OPD's) are available from theRecords Manager, Alaska OCS Region,Minerals Management Service, 949 East

36th Avenue, room 502, Anchorage,Alaska 99508-4302, telephone (907)271-6621. The OPD's may be purchasedfrom the Records Manager for $2 each.

Current editions of the listed OPD'sare based on the North American Datum(NAD) of 1927. Prior to the issuance ofthe Notice of Sale, new editions of allthe listed OPD's would be preparedbased on the NAD of 1983.

4. Instructions on Call. Respondentsare requested to nominate blocks withinthe Call area that they would likeconsidered for inclusion in proposedOCS Lease Sale 144. Nominations mustbe depicted on the Call map byoutlining the area(s) of interest alongblock lines. Respondents are asked tosubmit a list of whole and partial blocksnominated (by OPD designations) tofacilitate correct interpretation of theirnominations on the Call map. Althoughthe identities of those submittingnominations become a matter of publicrecord, the individual nominations aredeemed to be proprietary information.

Respondents are also requested torank areas nominated according to

riority of interest (e.g., priority 1high), 2 (medium), or 3 (low). Areas

nominated that do not indicatepriorities will be considered priority 3.Respondents are encouraged to be asspecific as possible in indicating areasor blocks by priority. Blanket prioritieson large areas are not useful in theanalysis of industry interest. Thetelephone number and name of a personto cortact in the respondent'sorganization for additional informationshould be included in the response.

Comments are sought from allinterested parties about particulargeologic, environmental, biological,archaeological, or social and economicconditions, conflicts, or otherinformation that might bear uponpotential leasing and development inthe Call area. Comments are also soughton potential conflicts with approvedlocal coastal management plans (CMP's)that may result from the proposed saleand future OCS oil and gas activities. Ifpossible, these comments shouldidentify specific CMP policies ofconcern, the nature of the conflictsforeseen, and steps that MMS could taketo avoid or mitigate the potentialconflicts. Comments may be in terms ofbroad areas or restricted to particularblocks of concern. Those submittingcomments are requested to list blocknumbers or outline the subject area onthe large-scale Call map.

Nominations and comments must bereceived no later than 45 days followingpublication of this document in theFederal Register in envelopes labeled"Nominations for Proposed Beaufort Sea

64964


Lease Sale 144," or "Comments on theCall for Information and Nominationsfor Proposed Beaufort Sea Lease Sale144," as appropriate. The original Callmap with indications of interest and/orcomments must be submitted to theRegional Supervisor, Leasing andEnvironment, Alaska OCS Region,Minerals Management Service, 949 East36th Avenue, room 603, Anchorage,Alaska 99508-4302.

5. Use of Information from Call.Information submitted in response tothis Call will be used for severalpurposes. First, responses will be usedto help identify the areas for potentialoil and gas development. Second,comments on possible environmentaleffects and potential use conflicts willbe used in the analysis of environmentalconditions in and near the Call area. Athird purpose for this Call is to assist inthe scoping of the EIS and thedevelopment of alternatives to theproposed action for analysis. The Noticeof Intent to Prepare an EIS is includedlater in this document. Fourth,comments may be used in developinglease terms and conditions to ensuresafe offshore oil and gas activities. Fifth,comments may be used to assess theconsistency between offshore oil andgas activities and the State's CMP.

6. Existing Information. TheInformation Base Review (IBR) step wascompleted in March 1993. The purposeof the IBR is to evaluate the status ofinformation and information acquisitionefforts. The IBR also involves anassessment of the quality of theinformation that will be considered inmaking a decision as to whether toproceed with planning efforts (includingthe Call/NOI) for the development ofleasing proposals.

The IBR for Beaufort Sea Sale 144included publication of a Request forInterest and Information in December1992, with comments due by the end ofJanuary 1993, and Information TransferMeetings in Anchorage, Alaska, inJanuary 1993. On the basis of theinformation analyzed during the reviewprocess, a determination was made thatthere is sufficient information andinterest to proceed with the Call.

The National Research Council of theNational Academy of Sciences isconducting a study on environmentalinformation for oil and gas leasingdecisions in the Beaufort Sea, ChukchiSea, and Navarin Basin OCS PlanningAreas. This study, expected to becompleted December 1993, willexamine information needs, costs of

obtaining information, potentialimprovements in the management andprediction of environmental effects thatmay result from acquiring additionalinformation, and options to conductingadditional studies. The conclusions ofthis report can be considered, alongwith information received in responseto the Call and scoping efforts, insubsequent decisions in the preleaseprocess.

An extensive environmental, socialand economic studies program has beenunder way in this area since 1975. Theemphasis has been on: Geologicmapping; environmentalcharacterization of biologically sensitivehabitats; efidangered whales and marinemammals; physical oceanography;ocean-circulation modeling; andecological effects of oil and gasactivities. A complete listing ofavailable study reports and informationfor ordering copies may be obtainedfrom the Records Manager, Alaska OCSRegion, at the address stated underDescription of Area. The reports mayalso be ordered directly from the U.S.Department of Commerce, NationalTechnical Information Service, 5285Port Royal Road, Springfield, Virginia22161 or by telephone at (703) 487-4650.

In addition, a program status reportfor continuing studies in this area maybe obtained from the Chief,Environmental Studies Section, AlaskaOCS Region, at the address stated underInstructions on Call or by telephone at(907) 271-6620.

Summary Reports and Indices andtechnical and geologic reports areavailable for review at the MMS AlaskaOCS Region (see address underDescription of Area). Copies of theAlaska OCS Regional Summary Reportsmay also-be obtained from the OCSInformation Program, Office of OffshoreInformation and Publications, MineralsManagement Service, 381 Elden Street,Herdon, Virginia 22070.

7. Tentative Schedule. Approximatedates for actions and decision andconsultation points in the planningprocess are:

Milestones Dates

Comments Due on the CallScoping Comments Due .....Area Identification ...............Draft EIS/Proposed Notice

of Sale Published.Hearings on Draft EIS Held

January 1994.February 1994.June 1994.July 1995.

September1995.

Milestones Dates

Govemor's Comments Due October 1995.on Proposed Notice ofSale.

Final EIS Filed with EPA ..... July 1996.Consistency Determination July 1996.

Signed.Final Notice of Sale Pub- November

lished. 1996.Sale .................................... December

1996.

8. Purpose of Notice of Intent toPrepare an Environmental ImpactStatement. Pursuant to the regulations(40 CFR 1501.7) implementing theprovisions of the NationalEnvironmental Policy Act of 1969 (42U.S.C. 4321 et seq.), as amended, MMSis announcing its intent to prepare anEIS regarding the oil and gas leasingproposal known as Sale 144 BeaufortSea. The MMS will conduct a scopingprocess, to give Federal, State, and localgovernments and other interestedparties the opportunity to aid MMS indetermining the significant issues andalternatives to be analyzed in the EISand to identify possible needs foradditional information.

The EIS analysis will focus on thepotential environmental effects ofleasing, exploration, and developmentof the blocks included in the areadefined in the Area Identificationprocedure as the proposed area of theFederal action. Alternatives to theproposal that may be considered are todelay the sale, cancel the sale, or modifythe sale.

9. Instructions on Notice of Intent.Federal, State, and local governmentsand other interested parties arerequested to send their writtencomments on the scope of the EIS,significant issues that should beaddressed, and alternatives that shouldbe considered to the RegionalSupervisor, Leasing and Environment,Alaska OCS Region, at the addressstated under Instructions on Call above.Comments should be enclosed in anenvelope labeled "Comments on theNotice of Intent to Prepare an EIS on theproposed Beaufort Sea Lease Sale 144."Comments are due no later than 45 daysfrom publication of this Notice.Tom Fry,Director, Minerals Management Service.

Approved: December 2, 1993.Bob Armstrong,B.j. Thornberry,DeputyAssistant Secretary, Land andMinerals Management.

64965


i

64966


[FR Doc. 93-30158 Filed 12-9-93; 8:45 am]BILUNG COOS 43110-11R-

National Park Service

Buffalo National River, ConcessionContract

AGENCY: National Park Service, Interior.ACTION: Public notice.

SUMMARY: Public notice is hereby giventhat the National Park Service proposesto award a concession contractauthorizing continued overnightaccommodations and food servicefacilities for the public at BuffaloNational River for a period of five (5)years from January 1, 1994, throughDecember 31, 1999.EFFECTIVE DATE: February 8, 1994.ADDRESSES: Interested parties shouldcontact the Superintendent, BuffaloNational River, P.O. Box 1173, Harrison,Arkansas 72602-1173, for informationas to the requirements of the proposedcontract.SUPPLEMENTARY INFORMATION: Thiscontract renewal has been determined tobe categorically excluded from theprocedural provisions of the NationalEnvironmental Policy Act and no'environmental document will beprepared.

The existing concessioner hasperformed its obligations to thesatisfaction of the Secretary under anexisting contract which expires bylimitation of time on December 31,1993, and, therefore, pursuant to theprovisions of section 5 of the Act ofOctober 9, 1965, (79 Stat. 969; 16 U.S.C.20), is entitled to be given preference inthe renewal of the contract and in thenegotiation of a new contract, providingthat the existing concessioner submits aresponsive offer (a timely offer whichmeets the terms and conditions of theProspectus). This means that thecontract will be awarded to the partysubmitting the best offer, provided thatif the best offer was not submitted bythe existing concessioner, then theexisting concessioner will be affordedthe opportunity to match the best offer.If the existing concessiofer agrees tomatch the best offer, then the contractwill be awarded to the existingconcessioner. If the existingconcessioner does not submit aresponsive offer, the right of preferencein renewal shall be considered to havebeen waived, and the contract will thenbe awarded to the party that hassubmitted the best responsive offer.

The Secretary will consider andevaluate all proposals received as aresult of this notice. Any proposal,

including that of the existingconcessioner, must be received by theRegional Director not later than thesixtieth (60th) day following publicationof this notice to be considered andevaluated.

Dated: September 27, 1993.John E. Cook.Regional Director.[FR Doc. 93-30271 Filed 12-9-93; 8:45 am]BILUNG CODE 4310-70-M

INTERSTATE COMMERCECOMMISSION

Intent To Engage in CompensatedIntercorporate Hauling Operations

This is to provide notice as requiredby 49 U.S.C. 10524(b)(1) that the namedcorporations intend to provide or usecompensated intercorporate haulingoperations as authorized in 49 U.S.C.10524(b).

1. Parent Corporation and address ofprincipal office: Bunzl DistributionUSA, Inc., 701 Emerson Rd., Suite 410,P.O. Box 419111, St. Louis, MO 63141-9111.

2. Wholly owned subsidiaries whidhwill participate in the operations, andState(s) of incorporation:

i Assumed State ofI name Inc.

Alliance Paper& PackagingCo.

Bennett PaperCo.

Bunzl Boston,Inc.

Bunzl Califor-nia, Inc.

Bunzl Colum-bus, Inc.

Bunzl Dallas,Inc.

Bunzi NewJersey. Inc.

Bunzl Read-ing, Inc.

Bunzl SouthFlorida, Inc.

Bunzl USATampa, Inc.

Bunzl Utah,Inc..

Capital Con-solidated,Inc.

Cast-AwayProducts,Co.

Bunzl Packag-ing.

Bunzl Bennett

No AssumedName.

Bunzl Super-markets.

No AssumedName.

No AssumedName.

No AssumedName.

No AssumedName.

No AssumedName.

Bunzl Tampa.

Bunzl SaltLake City.

Bunzl Indian-apolis.

Bunzl Evans-ville.

BunzI Louis-ville..

Bunzi PrittyPak.

No AssumedName.

New York.

Pennsylva-nia.

Massachu-setts.

California.

Ohio.

Delaware.

New Jer-sey.

Pennsylva-nia.

Florida.

Florida.

Utah.

Indiana.

New Jer-sey.

Subsidiary Assumed State ofname Inc.

ConsolidatedPackaging,inc.

E. Greene andCompany,Inc.

GrossmanPaper Com-pany, Inc.

The LabelCompany,Inc.

Liberty Paper& Bag Com-pany.

Mac-Pak. Inc.

PackagingConsultants,Inc.

Packaging Ma-terials, Inc.

PackagingProductsCorporationof America.

PackagingSupplyCompany.Inc.

PapercraftSoutheast.

Bunzl Rich-mond, Inc..

PapercraftSouthwest,Inc.

Papercraft Inc

W.E. BuehlerPaper Co.

Western Pack-aging, Inc.

Y Not BetterPapers, Inc.

Bunzl Denver.

Bunzl Okla-homa City.

PapercraftSouthwest.

Bunzl NewYork.

No AssumedName.

No AssumedName.

Bunzl Detroit..

Bunzl/Mac-PakPapercraft

SouthwestBunzl St.

Louis.

Bunzl ChicagoPapercraft ......Bunzl Min-

neapolis.BunzI Dallas..

Bunzl Atlanta.

Camelot Dis-

Papercraft Vir-ginia.

No AssumedName.

No AssumedName.

No AssumedName.

BunzJ Houston

PapercraftSouthwest

Oklahoma.

New York.

Delaware.

Missouri.

Michigan.

Kentucky.

Missouri.

Minnesota.

Wisconsin.

Georg ia.

Delaware.

Virginia.

Delaware.

California.

Ohio.

Texas.

Texas.

Sidney L Strickland, Jr.,Secretary.[FR Doc. 93-30199 Filed 12-9-93; 8:45 am]BILLING COOE 7036.41-4

[SeNice OrdrlPirected Service Order No.1514]

Decatur Junction Railway Co.-Request for Service OrderlDirectedService Order--Cisco to GreeneSwitch, IL

Decatur Junction Railway (DJ) hasrequested that the Commission undereither 49 U.S.C. 11123 or 11125, issuea service order or directed service orderauthorizing it to operate a line of

64967


railroad between Greens Switch andCisco, IL, a distance of approximately13.4 miles. The line is owned by CiscoCooperative Grain Company (CISCO)and has been served under contract bythe Indiana Hi-Rail Corporation (IHR).DJ contends, however, that IHR refusesto serve the line unless Cisco prepaysfreight charges for a certain number ofguaranteed carload shipments inadvance of the shipments beingtendered for transportation. IHRresponded to DJ's contention assertingits right to require prepayment as acondition for service.

Upon receipt of the filings notedabove by the Office of Compliance andConsumer Assistance (OCCA), a fieldinquiry was conducted by OCCA todetermine whether the circumstances,as presented, meet the statutory criteriafor directed service or other emergencyaction by the Commission. The fieldreview showed that there are two activeshippers on the Cisco line. The fieldreview also confirmed that a disputeexists between the IHR and CISCO overcertain conditions IHR has imposed onCISCO for the payment of charges whichhas resulted in the lapse of service onthe line by IHR.

After a full review of all thecircumstances, we do not believe thatthe conditions presented here meet theminimum magnitude standards ofsubstantial regional impact on railservice required for Commission actionunder 49 U.S.C. 11123. Neither do webelieve that service has beendiscontinued as contemplated by 49U.S.C. 11125. The basis of the lapse ofservice relates only to a dispute betweenthe parties, the circumstances of whichdo not meet any of the 49 U.S.C. 11125requirements that permit directedservice when operations have beendiscontinued without Commissionauthority. Moreover, DJ continues tohold authority from the Commission tolease and operate the line in questionfrom CISCO. See Finance Docket No.32365, Decatur Junction Railway Co.-Lease and Operation Exemption-Linesin Illinois, served October 18, 1993.

By separate letter of Counsel, datedNovember 13, 1993, IHR requested aProtective Order of a specific documentidentified as Attachment B, Exhibit 1 toDJ's filing in this matter. The request fora Protective Order will be denied

In a related matter, the Commission issuedShow Cause Order No. 41162, served December 3,1993. to determine whether EIR (the currentoperator of the line) or CISCO (the owner of theline) should have obtained authority from theCommission under 49 U.S.C. 10901 to acquire andoperate as a common carrier by railroad. Until thatmatter is disposed of by the Commission it isunclear which party has the responsibility toprovide service on the line.

inasmuch as the subject document wasalready in the public domain at the timethe request for relief was filed.

Decided: December 3, 1993.By the Commission, Chairman McDonald,

Vice Chairman Simmons, CommissionersPhillips and Philbin.Sidney L. Strickland, Jr.,Secretary.[FR Doc. 93-30200 Filed 12-9-93; 8:45 am]BILUNG CODE 7035-1-P

[Docket No. AB-3; Sub-No. 11OX]

Missouri Pacific Railroad Co.;Abandonment Exemption; In DickinsonCounty, KS

AGENCY: Interstate CommerceCommission.ACTION: Notice of exemption.

SUMMARY: The Commission exemptsfrom the prior approval requirements of49 U.S.C. 10903-10904 theabandonment by Missouri PacificRailroad Company of an 18.52-mile lineof railroad, known as the WoodbineIndustrial Lead, in Dickinson County,KS, subject to standard labor protectiveconditions, a historic resourcescondition, and terms and conditions forimplementing interim trail use/railbanking.DATES: Provided no formal expression ofintent to file an offer of financialassistance has been received, thisexemption will be effective onDecember 10, 1993. Formal expressionsof intent to file an offer of financialassistance under 49 CFR 1152.27(c)(2) Imust be filed by December 20, 1993.Petitions to stay must be filed byDecember 27, 1993. Requests for apublic use condition must be filed byDecember 30, 1993. Petitions to reopenmust be filed by January 4, 1994.ADDRESSES: Send pleadings, referring toDocket No. AB-3 (Sub-No. 11OX), to: (1)Office of the Secretary, Case ControlBranch, Interstate CommerceCommission, Washington, DC 20423;and (2) Petitioner's representative:Joseph D. Anthofer, 1416 Dodge Street#830, Omaha, NE 68179.FOR FURTHER INFORMATION CONTACT:Richard B. Felder, (202) 927-5610. (TDDfor hearing impaired: (202) 927-5721).SUPPLEMENTARY INFORMATION:Additional information is contained inthe Commission's decision. To purchasea copy of the full decision, write to, call,or pick up in person from: DynamicConcepts, Inc., room 2229, InterstateCommerce Commission Building,

'See Exempt. of Rail Abandonment-Offers ofFinan. Assist., 4 I.C.C.2d 164 (1987).

Washington, DC 20423. Telephone:(202) 289-4357/4359. (Assistance forthe hearing impaired is availablethrough TDD services at (202) 927-5721.)

Decided: December 2, 1993.By the Commission, Chairman McDonald,

Vice Chairman Simmons, CommissionersPhillips, Philbin, and Walden.Sidney L. Stricdand, Jr.,Secretary.[FR Doc. 93-30201 Filed 12-9-93; 8:45 amlBILUNG CODE 70364-1-P

[Docket No. AB-3 (Sub-No. 113X)]

Missouri Pacific Railroad Co.-Abandonment Exemption-In ScottCounty, MO

Missouri Pacific Railroad Company(MP) has filed a notice of exemptionunder 49 CFR Part 1152 Subpart F-Exempt Abandonments andDiscontinuances to abandon anapproximately 0.11-mile portion of itsSikeston Branch rail line betweenmilepost 216.27 and milepost 216.38near Miner, in Scott County, MO.

MP has certified that: (1) No localtraffic has moved over the line for atleast 2 years; (2) there is no overheadtraffic on the line; (3) no formalcomplaint filed by a user of rail serviceon the line (or by a State or localgovernment entity acting on behalf ofsuch user) regarding cessation of serviceover the line either is pending with theCommission or with any U.S. DistrictCourt or has been decided in favor ofthe complainant within the 2-yearperiod; and (4) that the requirements at49 CFR 1105.7 (environmental reports),49 CFR 1105.8 (historic reports), 49 CFR1105.11 (transmittal letter), 49 CFR1105.12 (newspaper publication) and 49CFR 1152.50(d)(1) (notice togovernmental agencies) have been met.

As a condition to use of thisexemption, any employee adverselyaffected by the abandonment shall beprotected under Oregon Short Line R.Co.-Abandonment--Goshen, 360 I.C.C.91 (1979). To address whether thiscondition adequately protects affectedemployees, a petition for partialrevocation under 49 U.S.C. 10505(d)must be filed.

Provided no formal expression ofintent to file an offer of financialassistance (OFA) has been received, thisexemption will be effective on January9, 1994, unless stayed pendingreconsideration. Petitions to stay that donot involve environmental issues,'

I A stay will be issued routinely by theCommission in those proceedings where an

64968

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Notices 6

formal expressions of intent to file anOFA under 49 CFR 1152.27(c)(2),2 andtrail use/rail banking requests under 49CFR 1152.29 3 must be filed byDecember 20, 1993. Petitions to reopenor requests for public use conditionsunder 49 CFR 1152.28 must be filed byDecember 30, 1993, with: Office of theSecretary, Case Control Branch,Interstate Commerce Commission,Washington, DC 20423.

A copy of any pleading filed with theCommission should be sent toapplicant's representative: Joseph D.Anthofer, 1416 Dodge Street, room 830,Omaha, NE 68179.

If the notice of exemption containsfalse or misleading information, theexemption is void ab initio.

MP has filed an environmental reportwhich addresses the abandonmenteffects, if any, on the environmental andhistoric resources. The Section ofEnergy and Environment (SEE) willissue an environmental assessment (EA)by December 15, 1993. Interestedpersons may obtain a copy of the EA bywriting to SEE (Room 3219, InterstateCommerce Commission, Washington,DC 20423) or by calling Elaine Kaiser,Chief of SEE, at (202) 927-6248.Comments on environmental andhistoric preservation matters must befiled within 15 days after the EA isavailable to the public.

Environmental, historic preservation,public use, or trail use/rail bankingconditions will be imposed, whoreappropriate, in a subsequent decision.

Decided: December 2, 1993.By the Commission, David M. Konschnik,

Director, Office of Proceedings.Sidney L Strickland, Jr.,Secretary.[FR Doec. 93-30202 Filed 12-9-93; 8:45 am]BLUN COOE 7035-01-P

COMMISSION ON IMMIGRATION

REFORM

Hearing

AGENCY: U.S. Commission onImmigration Reform.

informed decision on environmental issues(whether raised by a party or by the Commission'sSection of Energy and Environment in Itsindependent investigation) cannot be made prior tothe effective date of the notice of exemption. SeeExemption of Out-of-Service Rail Lines, 5 LCC2d377 (1989). Any entity seeking a stay onenvironmental concerns is encouraged to file itsrequest as soon as possible in order to permit thisCommission to review and act on the request beforethe effective date of this exemption.

2 See Exempt. of Rail Abandonment-Offers ofFinan. Assist.. 4 Lc.c.2d 164 (1987).

3 The Commission will accept a late-filed trailuse request as long as it retains jurisdiction to doSO.

ACTION: Correction.

SUMMARY: This notice relates to a publichearing of the Commission onImmigration Reform announced in theFederal Register on December 7, 1993(58 FR 64395). The date of the hearingwill be December 13, 1993.FOR FURTHER INFORMATION CONTACT: BethMalks or Deborah Waller.

Telephone: (202) 673-5348.Dated: December 7, 1993.

Susan Martin,Executive Director.[FR Doec. 93-30338 Filed 12-9-93; 8:45 am]BILUNG CODE 68207-M

DEPARTMENT OF JUSTICE

Immigration and Naturalization Service

[INS No. 1350N-03]

RIN 1115-ADO6

INS Immigration User Fee Increase

AGENCY: Immigration and NaturalizationService, Justice.ACTION: Notice.

SUMMARY: The Immigration andNationality Act authorizes the AttorneyGeneral to collect a user fee perindividual for the immigrationinspection of each passenger arriving ata port of entry into the United States, orfor the preinspection of a passengeroutside of the United States prior tosuch arrival, aboard a commercialaircraft or commercial vessel, withcertain exceptions. This Notice advisesthe public that the Congress recentlyincreased the Immigration User Feefrom $5.00 to $6.00 per individual.EFFECTIVE DATE: December 20, 1993.FOR FURTHER INFORMATION CONTACT:Robert Bevilacqua, Office of Finance,Immigration and Naturalization Service,425 1 Street NW., room 6321,Washington. DC 20036-0002, telephone202-616-2754.SUPPLEMENTARY INFORMATION: TheCongress recently increased theImmigration User Fee from $5.00 to$6.00 per individual. Public Law 103-121, 107 Stat. 1153, which was signedinto law by the President on October 27,1993, amends section 286 of theImmigration and Nationality Act (8U.S.C. 1356) to require carriers to collecta $6.00 fee per passenger.

The Immigration and NaturalizationService will make this rate changeeffective December 20, 1993. All ticketssold on or after December 20, 1993,should reflect the $6.00 user fee.

Dated: December 2. 1993.Doris Meissner,Commissioner, Immigration andNaturalization Service.[FR Doec. 93-30198 Filed 12-9-93; 8:45 amlBILUNG CODE 4410-10-

DEPARTMENT OF LABOR


Senior Executive Service; Appointmentof a Member to the PerformanceReview Board

Title 5 U.S.C. 4314(c)(4) provides thatNotice of the appointment of anindividual to serve as a member of thePerformance Review Board of the SeniorExecutive Service shall be published inthe Federal Register.

The following individual is herebyappointed to a three-year term on theDepartment's Performance ReviewBoard: Cecilia BankinsFOR FURTHER INFORMATION CONTACT:Mr. Larry K. Goodwin, Director ofPersonnel Management. room C5526,U.S. Department of Labor, FrancesPerkins Building, 200 ConstitutionAvenue, NW., Washington, DC 20210,telephone: (202) 219-6551.

Signed at Washington, DC, this 6th day ofDecember, 1993.Robert B. Reich,Secretary of Labor.IFR Dec; 93-30250 Filed 12-9-93; 8:45 am]BILUNG CODE 4510-23-

Employment and TrainingAdministration

Advisory Council on UnemploymentCompensation; Meeting

SUMMARY: The Advisory Council onUnemployment Compensation (ACUC)was established in accordance with theprovisions of the Federal AdvisoryCommittee Act on January 24, 1992(Federal Register, February 3. 1992, pg.4067). Public Law 102-164, theEmergency UnemploymentCompensation Act of 1991, mandatedthe establishment of the Council toevaluate the overall unemploymentinsurance program, including thepurpose, goals, counter-cyclicaleffectiveness, coverage, benefitadequacy, trust fund solvency, fundingof State administrative costs,administrative efficiency, and otheraspects of the program; and to makerecommendations for improvement. TheCouncil has also been directed to focuson specific subjects such as the use ofregional or sub-state triggers for the

64969


Extended Benefit (EB) program, thework search requirement for the EBprogram, and eligibility andunemployment coverage for alienagricultural labor.TIME AND PLACE: The meeting will beheld from 8:30 a.m. to 12:30 p.m. 'onJanuary 11, 1994 and from 8:30 a.m. to12:30 p.m. on January 12, 1994 at theSheraton Palace Hotel, MendocinoRoom, 2 Montgomery Street, SanFrancisco, California.AGENDA: The agenda for the meeting isas follows:

(a) Discussion of recommendationsthat the Council might consider makingon reform of the Extended Benefitprogram;

(b) Discussion of recommendationsthat the Council might consider makingon trust fund solvency;

(c) Discussion of recommendationsthat the Council might consider makingon alien agricultural workers' eligibilityfor Unemployment Compensation;

(d) Discussion of Council's report toCongress and the President; and,

(e) Set an agenda for the Council'snext meeting.PUBLIC PARTICIPATION: The meeting willbe open to the public. Seating will beavailable to the public on a first-come,first-served basis. Seats will be reservedfor the media. Handicapped individualsshould contact the Designated FederalOfficial (DFO), listed below, if specialaccommodations are needed.FOR ADDITIONAL INFORMATION CONTACT:Esther R. Johnson, DFO, AdvisoryCouncil on UnemploymentCompensation, U.S. Department ofLabor, 200 Constitution Avenue, NW.,room S-4231, Washington, DC 20210.(202) 219-7831.

Signed at Washington, DC, this 6th day ofDecember 1993.Doug Ross,Assistant Secretary of Labor.1FR Doc. 93-30249 Filed 12-9-93; 8:45 am]BILUNG CODE 4510-39-Md

Employment Standards AdministrationWage and Hour Division

Minimum Wages for Federal andFederally Assisted Construction;General Wage Determination Decisions

General wage determination decisionsof the Secretary of Labor are issued inaccordance with applicable law and arebased on the information obtained bythe Department of Labor from its studyof local wage conditions and data madeavailable from other sources. Theyspecify the basic hourly wage rates andfringe benefits which are determined to

be prevailing for the described classes oflaborers and mechanics employed onconstruction projects of a similarcharacter and in the localities specifiedtherein.

The determinations in these decisionsof prevailing rates and fringe benefitshave been made in accordance with 29CFR part 1, by authority of the Secretaryof Labor pursuant to the provisions ofthe Davis-Bacon Act of March 3, 1931,as amended (46 Stat. 1494, as amended,40 U.S.C. 276a) and of other Federalstatutes referred to in 29 CFR part 1,Appendix, as well as such additionalstatutes as may from time to time beenacted containing provisions for thepayment of wages determined to beprevailing by the Secretary of Labor inaccordance with the Davis-Bacon Act.The prevailing rates and fringe benefitsdetermined in these decisions shall, inaccordance with the provisions of theforegoing statutes, constitute themiinimum wages payable on Federal andfederally assisted construction projectsto laborers and mechanics of thespecified classes engaged on contractwork of the character and in thelocalities described therein. Good causeis hereby found for not utilizing noticeand public comment procedure thereonprior to the issuance of thesedeterminations as prescribed in 5 U.S.C.553 and not providing for delay in theeffective date as prescribed in thatsection, because the necessity to issuecurrent construction industry wagedeterminations frequently and in largevolume causes procedures to beimpractical and contrary to the publicinterest.

General wage determinationdecisions, and modifications andsupersedeas decisions thereto, containno expiration dates and are effectivefrom their date of notice in the FederalRegister, or on the date written noticeis received by the agency, whichever isearlier. These decisions are to be usedin accordance with the provisions of 29CFR parts I and 5. Accordingly, theapplicable-decision, together with anymodifications issued, must be made apart of every contract for performance ofthe described work within thegeographic area indicated as required byan applicable Federal prevailing wagelaw and 29 CFR part 5. The wage ratesand fringe benefits, notice of which ispublished herein, and which arecontained in the Government PrintingOffice (GPO) document entitled"General Wage Determinations IssuedUnder The Davis-Bacon And RelatedActs," shall be the minimum paid bycontractors and subcontractors tolaborers and mechanics.

Any person, organization, orgovernmental agency having an interestin the rates determined as prevailing isencouraged to submit wage rate andfringe benefit information forconsideration by the Department.Further information and self-explanatory forms for the purpose ofsubmitting this data may be obtained bywriting to the U.S. Department of Labor,Employment Standards Administration,Wage and Hour Division, Division ofWage Determination, 200 ConstitutionAvenue, NW., room S-3014,Washington, DC 20210.

New General Wage DeterminationDecisions

The numbers of the decisions addedto the Government Printing Officedocument entitled "General WageDeterminations Issued Under the Davis-Bacon and Related Acts" are listed byVolume and State.

Volume I:Maine-ME930026 (Dec. 10, 1993)Pennsylvania--PA930061 (Dec. 10,

1993)Pennsylvania-PA930062 (Dec. 10,

1993)Vermont-VT930025 (Dec. 10, 1993)Volume II:Missouri-MO930021 (Dec. 10, 1993)Missouri-MO930022 (Dec. 10, 1993)Missou4-MO930023 (Dec. 10, 1993)Missouri-MO930024 (Dec. 10, 1993)Missouri-MO930025 (Dec. 10, 1993)Missouri-MO930026 (Dec. 10, 1993)Missouri-MO930027 (Dec. 10, 1993)Missouri-MO930028 (Dec. 10, 1993)Missouri-MO930029 (Dec. 10, 1993)Missouri-MO930030 (Dec. 10, 1993)Missouri-MO930031 (Dec. 10, 1993)Missouri-M0930032 (Dec. 10, 1993)Missouri-MO930033 (Dec. 10, 1993)Missouri-MO930034 (Dec. 10, 1993)Texas-TX930093 (Dec. 10, 1993)Texas-TX930094 (Dec. 10, 1993)Texas-TX930095 (Dec. 10, 1993)

Modification to General WageDetermination Decisions

The number of decisions listed in theGovernment Printing Office documententitled "General Wage DeterminationsIssued Under the Davis-Bacon andRelated Acts" being modified are listedby Volume and State. Dates ofpublication in the Federal Register arein parentheses following the decisionsbeing modified.

Volume I:Connecticut--CT930001 (Feb. 19, 1993)Georgia-GA930003 (Feb. 19, 1993)Georgia--GA930022 (Feb. 19, 1993)Georgia--GA930032 (Feb. 19, 1993)

64970


Kentucky-KY930028 (Feb. 19, 1993)Massachusetts-MA930001 (Feb. 19,

1993)Massachusetts-MA930002 (Feb. 19,






1993)Massachusetts--MA930009 (Feb. 19,




1993)Maine-ME930018 (Feb. 19, 1993)New York-NY930009 (Feb. 19, 1993)New Yoik-NY930012 (Feb. 19, 1993)New York-NY930018 (Feb. 19, 1993)New York-NY930019 (Feb. 19, 1993)New York-NY930020 (Feb. 19, 1993)New York-NY930031 (Feb. 19, 1993)New York-NY930042 (Feb. 19, 1993)Pennsylvania-PA930001 (Feb. 19,

1993)Pennsylvania-PA930002 (Feb. 19,


















1993)

Pennsylvania--PA930040 (Aug. 24,1993)

Pennsylvania-PA930042 (Oct. 1, 1993)

Volume II:

Arkansas-AR930003 (Feb. 19, 1993)Illinois-IL930001 (Feb. 19, 1993)Illinois-IL930007 (Feb. 19, 1993)Illinois-IL930017 (Feb. 19, 1993)Indiana-IN930018 (Feb. 19, 1993)Kansas-KS930007 (Feb. 19, 1993)Kansas--KS930010 (Feb. 19, 1993)Kansas-KS930011 (Feb. 19, 1993)Kansas-KS930021 (May. 7, 1993)Kansas-KS930023 (Jul. 2, 1993)Kansas-KS930026 (Jul. 16, 1993)Nebraska-NE930001 (Feb. 19, 1993)Nebraska-NE930002 (Feb. 19, 1993)Nebraska-NE930003 (Feb. 19, 1993)Nebraska-NE930011 (Feb. 19, 1993)Nebraska-NE930014 (Feb. 19, 1993)Nebraska-NE930057 (Jun. 11, 1993)Ohio-OH930001 (Feb. 19, 1993)Ohio-OH930002 (Feb. 19, 1993)Ohio-OH930003 (Feb. 19, 1993)Ohio-OH930012 (Feb. 19, 1993)Ohio-OH930014 (Feb. 19, 1993)Ohio-OH930028 (Feb. 19, 1993)Ohio-OH930029 (Feb. 19, 1993)Ohio-OH930034 (Feb. 19, 1993)Ohio-OH930035 (Feb. 19, 1993)Texas-TX930051 (Feb. 19, 1993)Texas-TX930073 (Feb. 19, 1993)

Volume III:

Colorado---C0930007 (Feb. 19, 1993)Colorado--C0930009 (Feb. 19, 1993)Colorado--CO930010 (Feb. 19, 1993)Colorado--CO930011 (Feb. 19, 1993)North Dakota-ND930002 (Feb. 19,1993)

Oregon--OR930001 (Feb. 19, 1993)Washington-WA930001 (Feb. 19, 1993)Washington-WA930002 (Feb. 19, 1993)Washington-WA930003 (Feb. 19, 1993)Washington-WA930007 (Feb. 19, 1993)Washington-WA930008 (Aug. 27,

1993)Washington-WA930009 (Feb. 19, 1993)Washington-WA930011 (Aug. 27,

1993)

General Wage DeterminationPublication

General wage determinations issuedunder the Davis-Bacon and related Acts,including those noted above, may befound in the Government Printing Office(GPO) document entitled "General WageDeterminations Issued Under The Davis-Bacon And Related Acts". Thispublication is available at each of the 50Regional Government DepositoryLibraries and many of the 1,400Government Depository Libraries acrossthe country. Subscriptions may bepurchased from:

Superintendent of Documents, U.S.Government Printing Office, Washington, DC20402 (202) 783-3238.

When ordering subscription(s), besure to specify the State(s) of interest,since subscriptions may be ordered forany or all of the three separate volumes,arranged by State. Subscriptions includean annual edition (issued on or aboutJanuary 1) which includes all currentgeneral wage determinations for theStates covered by each volume.Throughout the remainder of the year,regular weekly updates will bedistributed to subscribers.

Signed at Washington, DC this 3rd day ofDecember, 1993.Alan L. Moss,Director, Division of Wage Determinations.[FR Doc. 93-29972 Filed 2-9-93; 8:45 am]BILUNG ODE 4510-27-M

Mine Safety and Health Ad i~tain

Petitions for Modification

The following parties have filedpetitions to modify the application ofmandatory safety standards undersection 101(c) of the Federal MineSafety and Health Act of 1977.1. Double "B" Mining, Inc.

[Docket No. M-93-304-C]Double "B" Mining, Inc., P.O. Box

280, Tracy City, Tennessee 37387 hasfiled a petition to modify theapplication of 30 CFR 75.333(g)(ventilation controls) to its Mine No. 32(I.D. No. 40-02666) located in MarionCounty, Tennessee. The petitionerproposes to designate specific locations,strategically positioned, and to evaluatethe quantity and quality of air enteringand leaving the affected areas instead ofventilating and evaluating eachindividual area. The petitioner statesthat application of the standard wouldresult in a diminution of safety to theminers. In addition, the petitionerasserts that the proposed alternatemethod would provide at least the samemeasure of protection as would themandatory standard.

2. Double "B" Mining, Inc.[Docket No. M-93-305-C]

Double "B" Mining, Inc., P.O. 2box280, Tracy City, Tennessee 37387 hasfiled a petition to modify theapplication of 30 CFR 75.360(b)(6)(preshift examination) to its Mine No.32 (I.D. No. 40-02666) located inMarion County, Tennessee. Thepetitioner proposes to designate specificlocations, strategically positioned, andto evaluate daily the methane andoxygen and the quantity and quality ofair entering and leaving the affectedareas instead of ventilating andevaluating each individual area. The

64971


petitioner states that application of thestandard would result in a diminutionof safety to the miners. In addition, thepetitioner asserts that the proposedalternative method would provide atleast the same measure of protection aswould the mandatory standard.

3. Double "B" Mining, Inc.[Docket No. M-93-306--Cl

Double "B" Mining, Inc., P.O. Box280, Tracy City, Tennessee 37387 hasfiled a petition to modify theapplication of 30 CFR 75.364(a) (1) and(6) (weekly examination) to its Mine No.32 (I.D. No. 40-02666) located inMarion County, Tennessee. Due todeteriorating roof conditions, certainareas of the mine cannot be traveledsafely. The petitioner proposes toestablish evaluation check points atspecific locations to monitor thequantity and quality of air entering andleaving the affected areas. The petitionerstates that application of the standardwould result in a diminution of safetyto the miners. In addition, the petitionerasserts that the proposed alternativemethod would provide at least the samemeasure of protection as would themandatory standard.

4. Peabody Coal Company[Docket No. M-93-307-C

Peabody Coal Company, P.O. Box1990, Henderson, Kentucky 42420 hasfiled a petition to modify theapplication of 30 CFR 75.900 (low- andmedium-voltage circuits serving three-phase alternating current equipment;circuit breakers) to its Camp No. 11Mine (I.D. No. 15-08357) located inUnion County, Kentucky. The petitionerproposes to use vacuum contactorcircuit interrupting devices incombination with circuit breakerssubject to specific conditions listed inthe petition. This petition modifies aDecision and Order on a previouspetition, docket number M-92-128-C.The petitioner asserts that the proposedalternative method would provide atleast the same measure of protection aswould the mandatory standard.

5. Consolidation Coal Company[Docket No. M-93-308-C]

Consolidation Coal Company, 1800Washington Road, Pittsburgh,Pennsylvania 15241-1421 has filed apetition to modify the application of 30CFR 75.1002 (location of trolley wires,trolley feeder wires, high-voltage cablesand transformers) to its Robinson RunNo. 95 Mine (I.D. No. 46-01318) locatedin Harrison County, West Virginia. Toeliminate conflict between paragraph 25of MSHA's Proposed Decision and

Order, docket number M-92-90-C, and30 CFR 75.342(a)(2), the petitionerrequests that paragraph 25 be amended.The petitioner asserts that the proposedalternate method would provide at leastthe same measure of protection aswould the mandatory standard.

6. Tennessee Energy Corporation

,[Docket No. M-93-309-CITennessee Energy Corporation, Route

3, Box 343A, Whitwell, Tennessee37397 has filed a petition to modify theapplication of 30 CFR 75.333(g)(ventilation controls) to its Mine No. 50(I.D. No. 40-02869) located inSequatchie County, Tennessee. Thepetitioner proposes to designate specificocations, strategically positioned, and

to evaluate the quantity and quality ofair entering and leaving the affected areainstead of ventilating and evaluatingeach individual area. The petitionerstates that application of the standardwould result in a diminution of safetyto the miners. In addition, the petitionerasserts that the proposed alternatemethod would provide at least the samemeasure of protection as would themandatory standard.

7. Tennessee Energy Corporation

[Docket No. M-93-310-C]Tennessee Energy Corporation, Route

3, Box 343A, Whitwell, Tennessee37397 has filed a petition to modify theapplication of 30 CFR 75.364(a)(1)(weekly examination) to its Mine No. 50(I.D. No. 40-02869) located inSequatchie County, Tennessee. Due todeteriorating roof conditions, certainareas of the mine cannot be traveledsafely. The petitioner proposes toestablish evaluation check points atspecific locations to monitor thequantity and quality of air entering andleaving the affected areas. The petitionerstates that application of the standardwould result in a diminution of safetyto the miners. In addition, the petitionerasserts that the proposed alternativemethod would provide at least the samemeasure of protection as would themandatory standard.

8. Maple Meadow Mining Company

[Docket No. M-93-311-C]Cannelton, Inc., 315 70th Street,

Charleston, West Virginia 25304-2909has filed a petition on behalf of MapleMeadow Mining Company of Fairdale,West Virginia to modify the applicationof 30 CFR 75.364(a)(1) (weeklyexamination) to its Maple Meadow Mine(I.D. No. 46-03374) located in RaleighCounty, West Virginia. Due todeteriorating roof conditions in theintake air course in the 2111 panel, the

area cannot be traveled safely in itsentirety. The petitioner proposes toestablish a monitoring station at a point50 feet outby spad #2076, No. 3 Entryto monitor the quantity and quality ofair entering and leaving the affectedarea. The petitioner asserts that theproposed alternative method wouldprovide at least the same measure ofprotection as would the mandatorystandard.

9. Freeman United Coal MiningCompany

[Docket No. M-93-312-C]

Freeman United Coal MiningCompany, P.O. Box 100, West Frankfort,Illinois 62896-0100 has filed a petitionto modify the application of 30 CFR75.1722 (a) & (b) (mechanical equipmentguards) to its Orient No. 6 Mine (I.D. No.11-00599) located in Jefferson County,Illinois. The petitioner proposes to usearea guarding along the west side of the10th South Belt Drive and take-up areaand the 2nd Main East Drive, due totight clearance at points between thedrive and take-up area, and the rib. Thepetitioner asserts that the proposedalternative method would provide atleast the same measure of protection aswould the mandatory standard.

10. Heatherly Mining, Inc.

[Docket No. M-93-313-C

Heatherly Mining, Inc., P.O. Box 550,Henryetta, Oklahoma 74437 has filed apetition to modify the application of 30CFR 75.1700 (oil and gas wells) to itsPollyana Mine (I.D. No. 34-01633)located in Okmulgee County, Oklahoma.The petitioner requests that its petitionand MSHA's Proposed Decision andOrder be amended to permit miningthrough the wells that have previouslybeen plugged without redrilling andreplugging the wells. The petitionerasserts that the proposed amendmentwould provide at least the samemeasure of protection as would thepreviously granted petition.

Request for Comments

Persons interested in these petitionsmay furnish written comments. Thesecomments must be filed with the Officeof Standards, Regulations andVariances, Mine Safety and HealthAdministration, room 627, 4015 WilsonBoulevard, Arlington, Virginia 22203.All comments must be postmarked orreceived in that office on or beforeJanuary 10, 1994. Copies of thesepetitions are available for inspection atthat address.

64972


Dated: December 6, 1993.Patricia W. Silvey,Director, Office of Standards, Regulations andVariances.[FR Doc. 93-30251 Filed 12-9-93; 8:45 am]BILUNG CODE 4510-43-P

Occupational Safety and Health

Administration

(Docket No. NRTL--2-02]

Canadian Standards Association

AGENCY: Occupational Safety and HealthAdministration, Department of Labor.ACTION: Notice of request for expansionof current recognition as a nationalrecognized testing laboratory.

SUMMARY: This notice announces theapplication of the Canadian StandardsAssociation, Rexdale (Toronto) facility,for expansion of its recognition as aNationally Recognized TestingLaboratory (NRTL) under 29 CFR1910.7, and presents the Agency'spreliminary finding.DATES: The last date for interestedparties to submit comments is January10, 1994.ADDRESSES: Send comments to: NRTLRecognition Program, Office of VarianceDetermination, Occupational Safety andHealth Administration, U.S.-Departmentof Labor, Third Street and ConstitutionAvenue NW., Room N3653,Washington, DC 20210.FOR FURTHER INFORMATION CONTACT:Office of Variance Determination, NRTLRecognition Program, OccupationalSafety and Health Administration, U.S.Department of Labor, Third Street andConstitution Avenue NW., Room N3653,Washington, DC 20210.SUPPLEMENTARY INFORMATION: Notice ishereby given that the CanadianStandards Association which previouslymade application pursuant to section6(b) of the Occupational Safety andHealth Act of 1970, (84 Stat. 1593, 29U.S.C. 655), Secretary of Labor's OrderNo. 1-90 (55 FR 9033), and 29 CFR1910.7, for recognition of its Rexdale(Toronto) facility as a NationallyRecognized Testing Laboratory (see 57FR 23429, 6/3/92; amended 57 FR48804, 10/28/92), and was so recognized(see 57 FR 61452, 12/24/92), has madeapplication for an expansion of itscurrent recognition, for the equipmentor materials listed below.

The address of the concernedlaboratory is: Canadian StandardsAssociation, Toronto Facility, 178Rexdale Boulevard, Rexdale (Toronto),Ontario M9W1R3, Canada.

EXPANSION OF RECOGNITION: TheCanadian Standards Association (CSA),submitted an application for expansionof its current recognition of the Rexdalefacility to include the following teststandards, which are appropriate withinthe meaning of 29 CFR 1910.7(c).UL 1278-Movable and Wall- or

Ceiling-Hung Electric Room HeatersUL 1419--Professional Video and Audio

EquipmentUL 1492-Audio and Video EquipmentUL 1963-Refrigerant Recovery/

Recycling EquipmentANSI/ASME B17.5-Elevators and

Escalator Electrical EquipmentThe NRTL Recognition Program staff

made an in-depth study of the details ofCSA's original recognition anddetermination that CSA had the staffcapability and the necessary equipmentto conduct testing of products using theproposed test standards. The NRTL staffdetermined that an additional on-sitereview was not necessary since theproposed additional test standards wereclosely related to CSA's current areas ofrecognition.

Preliminary FindingBased upon a review of the details of

CSA's recognition and an evaluation ofits present application including detailsof necessary test equipment, procedures,and special apparatus or facilitiesneeded, the Assistant Secretary hasmade a preliminary finding that theequipment and expertise required tocertify products using the fouraforementioned standards are within thecapabilities of the laboratory, and thatthe proposed additional test standards(product categories) can be added toCSA's recognition without the necessityfor an additional on-site review.

All interested members of the publicare invited to supply detailed reasonsand evidence supporting or challengingthe expansion of the current recognitionof the Rexdale (Toronto) Facility of theCanadian Standards Association, asrequired by 28 CFR 1910.7. Submissionof pertinent written documents andexhibits shall be made no later thanJanuary 10, 1994, and must beaddressed to the NRTL RecognitionProgram, Office of VarianceDetermination, room N 3653,Occupational Safety and HealthAdministration, U.S. Department ofLabor, Third Street and ConstitutionAvenue NW., Washington, DC 20210.

Copies of all pertinent documents(Docket No. NRTL-2-92), are availablefor inspection and duplication at theDocket Office, room N 2634,Occupational Safety and HealthAdministration, U.S. Department ofLabor, at the above address.

Signed at Washington, DC this 3rd day ofDecember, 1993.Joseph A. Dear,Assistant Secretary.[FR Doc. 93-30248 Filed 12-9-93; 8:45 am)BILUNG CODE 451046-M

Pension and Welfare BenefitsAdministration

[Application No. D-4176, etal.]

Proposed Exemptions; the NorthernTrust Company, et al.

AGENCY: Pension and Welfare BenefitsAdministration, Labor.ACTION: Notice of Proposed Exemptions.

SUMMARY: This document containsnotices of pendency before theDepartment of Labor (the Department) ofproposed exemptions from certain of theprohibited transaction restriction of theEmployee Retirement Income SecurityAct of 1974 (the Act) and/or the InternalRevenue Code of 1986 (the Code).

Written Comments and HearingRequests

All interested persons are invited tosubmit written comments or request fora hearing on the pending exemptions,unless otherwise stated in the Notice ofProposed Exemption, within 45 daysfrom the date of publication of thisFederal Register Notice. Comments andrequest for a hearing should state: (1)The name, address, and telephonenumber of the person making thecomment or request, and (2) the natureof the person's interest in the exemptionand the manner in which the personwould be adversely affected by theexemption. A request for a hearing mustalso state the issues to be addressed andinclude a general description of theevidence to be presented at the hearing.A request for a hearing must also statethe issues to be addressed and includea general description of the evidence tobe presented at the hearing.ADDRESSES: All written comments andrequest for a h'earing (at least threecopies) should be sent to the Pensionand Welfare Benefits Administration,Office of Exemption Determinations,room N-5649, U.S. Department ofLabor, 200 Constitution Avenue, NW.,Washington, DC 20210. Attention:Application No. stated in each Notice ofProposed Exemption. The applicationsfor exemption and the commentsreceived will be available for publicinspection in the Public DocumentsRoom of Pension and Welfare BenefitsAdministration, U.S. Department ofLabor, room N-5507, 200 ConstitutionAvenue, NW., Washington, DC 20210.

64973

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 I Notices

Notice to Interested PersonsNotice of the proposed exemptions

will be provided to all interestedpersons in the manner agreed upon bythe applicant and the Departmentwithin 15 days of the date of publicationin the Federal Register. Such noticeshall include a copy of the notice ofproposed exemption as published in theFederal Register and shall informinterested persons of their right tocomment and to request a hearing(where appropriate).SUPPLEMENTARY INFORMATION: Theproposed exemptions were requested inapplications filed pursuant to section408(a) of the Act and/or section4975(c)(2) of the Code, and inaccordance with procedures set forth In29 CFR part 2570, subpart B (55 FR32836, 32847, August 10, 1990).Effective December 31, 1978, section102 of Reorganization Plan No. 4 of1978 (43 FR 47713, October 17, 1978)transferred the authority of the Secretaryof the Treasury to issue exemptions ofthe type requested to the Secretary ofLabor. Therefore, these notices ofproposed exemption are issued solelyby the Department.

The applications containrepresentations with regard to theproposed exemptions which aresummarized below. Interested personsare referred to the applications on filewith the Department for a completestatement of the facts andrepresentations.

The Northern Trust Company(Northern Trust) Located in Chicago, IL

[Application No. D-91761

Proposed Exemption

The Department is consideringgranting an exemption under theauthority of section 408(a) of the Actand section 4975(c)(2) of the Code andin accordance with the procedures setforth in 29 CFR part 2570, subpart B (55FR 32836, 32847, August 10, 1990). Ifthe exemption is granted, therestrictions of sections 406fa)(1)(A) and406b)(2) of the Act and the sanctionsresulting from the application of section4975 of the Code, by reason of section4975(c)(1)(A) of the Code, shall notapply to: (1) The purchase and sale ofstocks between Index Funds and/orModel-Driven Funds (collectively, theFunds); and (2) the purchase and sale ofstocks between the Funds and variouslarge pension plans or other largeaccounts (collectively, the LargeAccounts) pursuant to portfoliorestructuring programs of the LargeAccounts, provided that the followingconditions are met:

(a) The Index or Model-Driven Fundis based on an index which representsthe investment performance of a specificsegment of the public market for equitysecurities in the United States and/orforeign countries. The organizationcreating and maintaining the Index mustbe: (1) Engaged in the business ofproviding financial information,evaluations, advice or securitiesbrokerage services to institutionalclients, (2) a publisher of financial newsor information, or (3) a public stockexchange or association of securitiesdealers. The index must be created andmaintained by an organizationindependent of Northern Trust and itsaffiliates. The index must be a generallyaccepted standardized index ofsecurities which is not specificallytailored for the use of Northern Trust orIts affiliates.

(b) The price of the stock is set at theclosing price for that stock on the dayof trading; unless the stock was addedto or deleted from an index underlyinga Fund or Funds after the close oftrading, in which case the price will bethe opening price for that stock on thenext business day after theannouncement of the addition ordeletion.

(c) The transaction takes place withinthree business days of the "triggeringevent" giving rise to the cross-tradeopportunity. A "triggering event" is.defined as:

(1) A change In the composition orweighting of the index underlying aFund by the organization creating andmaintaining the index;

(2) A change in the composition orweighting of a portfolio used for aModel-Driven Fund which results froman independent fiduciary's decision toexclude certain stocks or types of stocksfrom the Fund even though such stocksare part of the index used by the Fund;

(3) A change in the overall level ofinvestment in a Fund as a result ofinvestments and withdrawals made onthe Fund's regularly scheduled"opening date" which are not directedby Northern Trust; or

(4) A declaration by Northern Trust(recorded on Northern Trust's records)that a "triggering event" has occurredwhich will be made upon anaccumulation of cash in a Fundattributable to dividends on and/ortender offers for portfolio securitiesequal to not more than .5 percent of theFund's total value.

(d) A Fund does not participate in adirect cross-trade if the assets of anyemployee benefit plan maintained byNorthern Trust Corporation or itsaffiliates (the NTC Plans) in the Fund

exceed 10 percent of the total assets ofthe Fund.

(e) Prior to any proposed cross-tradingby a Fund, Northern Trust provides toeach employee benefit plan whichinvests in a Fund information whichdescribes the existence of the cross-trading program, the "triggering events"which will create cross-tradeopportunities, the pricing mechanismthat will be utilized for stockspurchased or sold by the Funds, and theallocation methods and otherprocedures which will be implementedby Northern Trust for its cross-tradingpractices. Any such employee benefitplan which subsequently invests in aFund shall be provided the sameinformation prior to or immediatelyafter the plan's initial investment in aFund.

() With respect to transactionsInvolving a Large Account:

(1) It has assets in excess of $50million.

(2) Fiduciaries of the Large Accountwho are independent of Northern Trustare, prior to any cross-tradetransactions, fully informed in writingof the cross-trade technique and provideadvance written authorization of suchtransactions.

Such authorization shall beterminable at will by the Large Accountupon receipt by Northern Trust ofwritten notice of termination. A formexpressly providing an election toterminate the authorization, withinstructions on the use of the form, mustbe supplied to the authorizing LargeAccount fiduciary concurrent with thereceipt of the written informationdescribing the cross-trading program.The instructions for such form mustinclude the following information:

•(i) The authorization is terminable atwill by the Large Account, withoutpenalty to the Large Account, uponreceipt by Northern Trust of writtennotice from the authorizing LargeAccount fiduciary; and

(ii) Failure to return the terminationform will result in the continuedauthorization of Northern Trust toengage in cross-trade transactions onbehalf of the Large Account.

(3) Within 45 daysof the completionof the Large Account's portfoliorestructuring program such fiduciariesshall be fully apprised in writing of theresults of such transactions. In addition,if the restructuring program takes longerthan three months to complete, interimreports of the results of all transactionswill be made within 30 days of the endof each three-month period.

(4) Such Large Account transactionsoccur only in situations where NorthernTrust has been authorized to restructure

64974


all or a portion of the Large Account'sportfolio into an Index or Model-DrivenFund (including a separate accountbased on an index or computer model)or to act as a "trading adviser" incarrying out the liquidation orrestructuring of the Large Account'sequity portfolio.

(g) Northern Trust recdlves noadditional direct or indirectcompensation as a result of the cross-trade transaction.

Ch) Northern Trust maintains orcauses to be maintained for a period ofsix years from the date of the transactionthe records necessary to enable thepersons described in paragraph (I) todetermine whether the conditions ofthis exemption have been met, exceptthat a prohibited transaction will not beconsidered to have occurred if, due tocircumstances beyond the control ofNorthern Trust or its affiliates, therecords are lost or destroyed prior to theend of the six-year period.

(i)(1) Except as provided in paragraph(i)(2) and notwithstanding anyprovisions of section 504(a)(2) and (b) ofthe Act, the records referred to inparagraph (h) are unconditionallyavailable at their customary location forexamination during normal businesshours by-

(I) Any duly authorized employee orrepresentative of the Department or theInternal Revenue Service,

(ii) Any fiduciary of a planparticipating in an Index or Model-Driven Fund who has authority toacquire or dispose of the interests of theplan, or any duly authorized employeeor representative of such fiduciary,

(ii) Any contributing employer to anyplans participating In an Index orModel-Driven Fund or any dulyauthorized employee or representativeof such employer, and

(iv) Any participant or beneficiary ofany plan participating in an Index orModel-Driven Fund, or any dulyauthorized employee or representativeof such participant or beneficiary.

(2) None of the persons described insubparagraphs (ii) through (iv) of thisparagraph (i) shall be authorized toexamine trade secrets of Northern Trust,any of its affiliates, or commercial orfinancial information which isprivileged or confidential.

DefinitionsFor purposes of this proposed

exemption: (a) The term "Index Fund"means any investment fund, account orportfolio sponsored, maintained and/ortrusteed by Northern Trust or an affiliatein which one or more investors investwhich is designed to replicate thecapitalization-weighted composition of

a stock index which satisfies condition(a) above.

(b) The term "Model-Driven Fund"means any investment fund, account orportfolio sponsored, maintained and/ortrusteed by Northern Trust or an affiliatein which one or more investors investwhich is based on computer modelsusing prescribed objective criteria totransform an independent third-partystock index which satisfies condition (a)above.-(c) The term "Large Account" means

a trust or other fund that is exempt fromtaxation under section 501 of the Code,and which has assets of at least $50million. A trust that is exempt fromtaxation under section 501(a) of theCode may aggregate the assets of one ormore employee benefit plans of a singleemployer or a controlled-group ofemployers the assets of which areinvested on a commingled basis (e.g.through a master trust) for purposes ofsatisfying the $50 million requirement.

(d) The term "NTC Plan" means an"employee pension benefit plan" (asdefined In section 3(2) of the Act)maintained by Northern Trust or any ofits affiliates.

(e) The term "opening date" meansthe regularly scheduled date on whichinvestments in or withdrawals from anIndex or Model-Driven Fund may bemade.

(f) The term "trading adviser" meansa person whose role is limited toarranging a Large Account-initiatedliquidation or equity restructuringwithin a stated time so as to minimizetransaction costs.

Summary of Facts and Representations1. Northern Trust Corporation (NTC)

is a bank holding company regulated byand registered under the Bank HoldingCompany Act of 1956, as amended.Northern Trust is an Illinois bankingcorporation which is a wholly-ownedsubsidiary of NTC and its principalasset. Northern Trust managessubstantial amounts of assets, typicallyas a trustee or investment manager, fora variety of clients, including employeebenefit plans subject to the Act (theClient Plans). Northern Trust managesthe assets of Client Plans either asseparate investment portfolios forindividual clients (including "mastertrust" accounts established for thecommingled investment of relatedentities) or as collective investmentfunds, organized as group trustspursuant to Rev. Rul. 81-100, for thecommingled investment of variousunrelated clients (collectively, theClient Accounts).

2. Northern Trust is one of the leadinginvestment managers in the United

States In the field of passive assetmanagement. Passive asset managementinvolves investment in a portfolio ofsecurities structured along setinvestment guidelines, rather than thecreation of a portfolio that changesaccording to an ongoing "active"evaluation of the desirability ofparticular equity securities. NorthernTrust states that approximately $2.5billion of its assets under managementas of December 31, 1991 consisted ofequity securities being passivelymanaged in various Index Funds andModel-Driven Funds. Approximately$1.8 billion of the assets of the Fundsare assets of the Client Plans.

Northern Trust has no beneficialownership interest in any of the Funds.However, Northern Trust does maintaina definect benefit plan (the NTC DefinedBenefit Plan) and a 401(k) savings plan(the NTC 401(k) Plan) for eligibleemployees of Northern Trust and itsaffiliates (i.e. the NTC Plans), assets ofwhich may be invested from time totime in one or more Index Funds orModel-Driven Funds. As of December31, 1991, the aggregate value of theassets of the NTC Plans wasapproximately $410.9 million, of whichapproximately $52.3 million wasinvested in the Index Funds.

3. The assets managed by NorthernTrust in an Index Fund are investedpursuant to a strategy that attempts toreplicate the performance of apredetermined third-party index, suchas the Standard & Poos 500 CompositePrice Index (the S&P 500 Index) and theRussell 2000 Small Stock Index (theRussell 2000 Index).

The current Index Funds maintainedby Northern Trust are as follows: (1) TheCollective Stock Index Fund, whichinvests In the common stock ofcompanies listed in the S&P 500 Indexin the same relative proportions as areused by the S&P 500 Index; and (2) theCollective Expanded Equity Fund,which invests in the common stock ofcompanies listed in the Russell 2000Index in the same relative proportionsas are used by the Russell 2000 Index.The investment goal of these IndexFunds is to replicate the capitalization-weighted total rate of return of therespective indexes upon which theirportfolios are based.

The assets managed by Northern Trustin the Model-Driven Funds are investedpursuant to various strategies wherebyinvestments are made in accordancewith computer models which seek toearn a rate of return that eitherreplicates or exceeds the rate of returnachieved by a specific index, such as theS&P 500 Index, upon which the modelis based.

64975


The current Model-Driven Fundsmaintained by Northern Trust are asfollows: (1) The Enhanced Index Fund;and (2) the Optimized Index Fund.

With respect to the Enhanced IndexFund, Northern Trust states that theFund seeks to earn a rate of returngreater than the S&P 500 Index bybuying and selling the componentstocks of the S&P 500 Index and stockindex derivatives (i.e. exchange-tradedfutures or options contracts) based onthe S&P 500 Index. However, NorthernTrust states that the Enhanced IndexFund will not participate in theproposed cross-trading program.

With respect to the Optimized IndexFund, Northern Trust-states that theFund seeks to track the S&P 500 Indexeven though certain component stocksin such index are excluded by the Fundbecause investors (including ClientPlans) want to avoid investing incompanies which are involved inindustries, practices, or locations thatare deemed inappropriate onphilosophical or other grounds. Forexample, certain categories of stocks(e.g. tobacco stocks) may be excluded byNorthern Trust from a Fund pursuant todirections from the independentfiduciaries of the Client Plans thatinvest in the Fund. Northern Trust thenweights the holdings of stocks otherwisedeemed acceptable by the independentfiduciaries of the Client Plans using acomputer model with an optimizingprogram which attempts to match theresulting portfolio, as closely aspossible, to the aggregate portfoliocharacteristics and expectedperformance of the S&P 500 Indexdespite the elimination of certain stocks.The computer models for the OptimizedIndex Fund are developed by NorthernTrust based on prescribed objectivecriteria established by Client Accountsthat invest in the Fund. Northern Truststates that it does not exercise anydiscretion for investment decisionsrelating to the exclusion of certainstocks in the portfolio developed for tteOptimized Index Fund.,

I The Department notes that to the extent thefiduciaries of the Client Plans restrict theirconsideration of investment opportunities for non-economic reasons, such conduct may involvecertain violations of Part 4 of Title I of the Actwhich would not be provided relief by the proposedexemption.

In this rpgard. section 404(a)(1) of the Actrequires, among other things, that a fiduciary of aplan act prudently, solely in the interest of theplan's participants and beneficiaries, and for theexclusive purpose of providing benefits toparticipants and beneficiaries. To act prudently, a

.plan fiduciary must consider, among other factors,the availability, riskiness, and potential return ofalternative investments for the plan. Because theinvestments made by a Fund are investments whichwould be selected, if at all. in preference to

None of the Funds will use a thirdparty index which includes in itsportfolio any stock issued by NTC or itsaffiliates (NTC Stock).2 Northern Trustnotes that the S&P 400 Midcap Index isthe only index which currently includesNTC Stock in its portfolio.

4. The applicant states that theholdings of any Fund may change if oneof the following "trigger events" occurs.

First, there could be a change in thecomposition or weighting of the indexunderlying a Fund by the organizationcreating or maintaining the index (seecondition (c)(1)). For example, Standard& Poors (S&P) may change thecomposition of the S&P 500 Indexwhich would require correspondingchanges in the make-up of theportfoliosof Northern Trust's Index Fundscorresponding to that index. Withrespect to any Model-Driven Fund, thecomputer model upon which the Fundis based may change as a result of achange in the stock index used for themodel. For example, since theOptimized Index Fund is based on theS&P 500 Index, the Fund would need tobuy or sell portfolio stocks inaccordance with any changes in the S&P500 Index which affect the computermodel for the Fund. Northern Truststates that it does not have anydiscretion for the timing of "triggerevents" relating to changes in thecomposition or weighting of an indexused by a Fund because such changesare controlled by an independentorganization which creates andmaintains the index.

Second, a Model-Driven Fund mayneed to buy or sell portfolio stocksbecause of a decision by a Client

alternative investments, such an investment wouldnot be prudent if it provided the Client Plan withless return, in comparison to risk, than comparableinvestments available to the Client Plan, or if itinvolved a greater risk to the security of the ClientPlan's assets than other investments offering asimilar return.

The Department has construed the requirementsthat a fiduciary act solely In the interest of. and forthe exclusive purpose of providing benefits to,participants and beneficiaries as prohibiting afiduclary from subordinating the interests ofparticipants and beneficiaries in their retirementincome to unrelated objectives. Thus, in decidingwhether and to what extent to invest in a particularinvestment, a fiduciary must ordinarily consideronly factors relating to the interests of planparticipants and beneficiaries in their retirementincome. A decision to make an investment may notbe influenced by non-economic factors unless theinvestment, when judged solely on the basis of itseconomic value to the plan, would be equal orsuperior to alternative investments available to theplan. (See DOL Advisory Opinion 81-12A, January13, 1981.)

2 See Prohibited Transaction Exemption 92-11(57 FR 7801, March 4, 1992), regarding Wells FargoBank. for additional conditions required for theacquisition, holding and disposition of Wells Fargo& Co. Stock by Index Funds and Model-DrivenFunds maintained by Wells Fargo Bank.

Account investor to exclude certainstocks from the Fund's portfolio even.though such stocks are held in the indexupon which the Fund is based (seecondition (c)(2)). The applicant statesthat such changes are not the result ofany exercise of discretion by NorthernTrust. In the case of a Client Plan, these"trigger events" are directed by anindependent fiduciary for the ClientPlan as a condition for its initial orcontinued investment in the Fund (asdiscussed above in Item 3).

Third, there could be a change in theoverall level of investment in a Fund asa result of investments and withdrawalsmade by the Client Accounts on theFund's regularly scheduled "openingdate." In the case of the Client Plans, allsuch investments or withdrawals aremade at the direction of an independentfiduciary, pursuant to writtenprocedures established in an investmentmanagement agreement with NorthernTrust. Such procedures specify, amongother things, how a Client Plan's assetsunder management are to be allocatedamong the various Funds. In the case ofthe NTC Plans. Northern Trust will not-engage in any cross-trades which resultfrom the investments in or withdrawalsfrom the Funds made by the NTCDefined Benefit Plan because suchinvestments and withdrawals are madeat the direction of Northern Trust (seecondition (c)(3)). However, investmentsin and withdrawals from the Funds bythe NTC 401(k) Plan which areparticipant-directed and not controlledby Northern Trust would be eligible forcross-trading by the Funds. In addition,all NTC Plans would participate in theproposed cross-trading program by theFunds to the extent that the cross-trading opportunities result from theother "trigger events" described herein.In any event, a Fund would not beeligible to participate in cross-trades ifthe assets of the NTC Plans in the Fundexceed 10% of the Fund's total assets(see condition (d)).

Fourth, there could be a declarationby Northern Trust (recorded onNorthern Trust's records) that a"triggering event" has occurred whichwill be made upon an accumulation ofcash in the Fund attributable todividends on and/or tender offers forportfolio stocks which will be limited toa de minimis amount (see condition(c)(3)). Northern Trust states thatrelatively few stocks held in the Funds'portfolios are subject to tender offertransactions at any particular time.

The applicant represents that sincethe "trigger events" described aboveoccur because of changes directed byindependent sources, Northern Trustdoes not exercise any discretion for the

64976


amount, nature and timing of trades bythe Funds which result from such"trigger events".

5. The Funds are often required to sella particular stock as a result of a "triggerevent" when one or more of the otherFunds will be in the process ofpurchasing that same stock in responseto a different "trigger event". If theFunds effect the required transactionson the open market, each Fund incurssubstantial transaction costs, includingbrokerage commissions, the so-called"marketmaker's spread", and thepotential adverse market impact whichmay be caused by the trade itself.Northern Trust states that if it were ableto effect these transactions by means ofa pre-arranged direct cross-tradebetween the Funds that must sell theparticular stock and the Funds whichmust buy that same stock, it couldsubstantially reduce the amount ofcommission costs for the Funds. Basedon an independent review of thepotential direct cross-tradeopportunities, Northern Trust estimatesthat the ability to effect direct cress-trades would generate substantialsavings to the Funds. Further, by cross-trading the stocks, Northern Trust couldeliminate entirely the marketmaker'sspread and any potential for adversemarket Impact which would occur in anopen-market transaction.

6. In addition to transactions arisingin connection with the automatictrading activities of the Index Funds andModel-Driven Funds, Northern Trust isoften retained to assist one of the LargeAccounts in liquidating all or asubstantial portion of the securities heldin its equity portfolio. In suchsituations, Northern Trust acts as a"trading adviser" to the Large Account.The Large Account would be a trust orother fund exempt from taxation undersection 501 of the Code (e.g. anemployee benefit plan subject to Title Iof the Act, a governmental plan, achurch plan, a university endowmentfund, a private foundation, etc.) whichhas total assets of at least $50 million.Northern Trust states that it is not afiduciary for the Large Account withrespect to the underlying assetallocation decision which results in theLarge Account allocating assets to theFunds. Specifically, Northern Trust isnot a fiduciary by reason of investmentadvice to the Large Account, includingany Large Plan, when acting in the roleof "trading adviser" to the LargeAccount. Northern Trust represents thatits role as a "trading adviser" involvesonly advice on the mechanical aspectsof accomplishing the Large Account'sasset allocation decision, such asarranging for the stock transactions so as

to minimize transaction costs. NorthernTrust does not provide any advice as afiduciary when acting as a "tradingadviser" regarding which stocks ortypes of stocks should be sold by a LargeAccount to accomplish its assetallocation goals. Such liquidations amthe result of the decision of anindependent fiduciary to restructure theportfolio, in some cases to allow suchportfolio to be managed by NorthernTrust as an Index Fund or a Model-Driven Fund and in other cases tofacilitate the realignment of the portfolioin connection with a change ininvestment managers or investmentstrategy. The applicant states that in thecourse of these restructurings, the LargeAccount will often be selling certainstocks which the Funds aresimultaneously in the process ofpurchasing as a result of a "triggerevent". In such cases, without anexemption to engage in cross-trading,the Large Account and the Funds wouldeffect the transactions on the openmarket and both the Large Account andthe Funds would Incur the transactioncosts described abpve.

7. Northern Trust represents that itwould be in the best interest of theClient Plans and the Large Accounts,including Large Plans, for direct cross-trades to be arranged and effected to themaximum extent possible.3 NorthernTrust states that the avoidance orreduction of transaction costs madepossible by direct cross-trading betweenthe Funds, or between the Funds andthe Large Accounts, would be aneconomic benefit to the Client Plans andthe NTC Plans. The proposed cross-trading of the securities between thevarious Funds and Large Accountsgenerally will be effected as quickly aspossible in order to minimize trackingerrors relative to the index used for aFund. However, the Funds typicallyaccept deposits and withdrawals onlyonce a week. Therefore, the applicantrequests that the Funds be allowed upto three days to cross-trade securities inorder to maximize the number ofpotential cross-trade opportunitiesbtween the Funds and Large Accountswhich occur as a result of deposits or

-'The applicant requests an exemption from theprohibitions of section 406(b)2) of the Act for thecross-trading of stocks between the Funds orbetween the Funds and the Large Accounts becauseNorthern Trust or an affiliate will be acting onbehalf of both parties to such transactions. Inaddition. Ncrtbern Trust requests an exemptionfrom the prohibitions of section 4061a)(1)[A) of theAct for the sale or exchange of stocks between theFunds and Large Accounts in the event a ClientPlan invested in one of the Funds is a party ininterest to another Client Plan invested in one of theother Funds or is a party in interest with respectto a Large Plan for which Northern Trust is actingas a "trading adviser" in such transaction.

withdrawals made for any particularFund. Cross trades will be accomplishedwithin no more than three days of the"triggering event" for the trade and, ifpossible, on the same business day as a"triggering event" occurs in order toremain fully invested in stocks and tominimize tracking error relative to theindex used for a particular Fund.

8. Northern Trust will receive itscustomary investment management ortrustee fees with respect to the ClientPlans and its fee for acting as "tradingadviser" to a Large Account. However,Northern Trust will not receive anyadditional compensation on account ofits effecting the direct cross-trades.Northern Trust intends to accomplishall possible cross-trades in-housewithout the use of a broker. However,Northern Trust represents that theutilization of an independent broker-dealer may be necessary in some casesto efficiently process the mechanicalaspects of the direct cross-trade,particularly when Northern Trust is notthe custodian or trustee for both partiesto the transaction. For example, theneed for an independent broker-dealermay arise in the context of transactionsbetween the Funds, for which NorthernTrust is the trustee or custodian, andone of the Large Accounts for whichNorthern Trust is only a "tradingadviser" for the transaction but not atrustee or custodian for the assets of theLarge Account involved. In suchinstances, Northern Trust may need touse a broker to effectuate the re-registration of stocks that am custodiedat another financial institution.Northern Trust states that where it is thetrustee or custodian for both parties, itgenerally will be able to efficientlyprocess the mechanical aspects of thetrade without the involvement of anybroker-dealer, thereby resulting in thecomplete avoidance of any brokeragecommissions. Northern Trust expectsthat its need to use a broker-dealer toprocess a cross-trade will be rare andthat if a broker-dealer is used, thebrokerage cost to the Funds and/orLarge Accounts will be less than thecost that would be incurred if the tradewere executed on the open market. Inno event will Northern Trust or any ofits affiliates receive any brokeragecommissions or other additionalcompensation as result of the directcross-trades.

9. All direct cross-trades will be forcash. For most "triggering events",direct cross-trades will be effected at aSrice equal to the closing price reportedy the independent pricing service

utilized by Northern Trust for purposesof valuing the particular stocks (and inthe case of foreign stocks, the particular

I I

64977


currency). The independent pricing* service used by Northern Trust gathers

price information from all the relevantsources (i.e. the New York StockExchange, the American StockExchange, NASDAQ, etc.) and compilesthe information into a format which isusable by the Northern Trust.4 However,if the "triggering event" involves theaddition or deletion of a particular stockfrom an independent third-party indexafter the close of trading, Northern Trustwill effect such direct cross-trades at aprice equal to the opening price for thatstock on the next business day after theannouncement of the addition ordeletion. The pricing mechanismutilized by Northern Trust for cross-trading will be specified in advance toall Client Accounts prior to anytransactions.

10. The direct cross-trade programwill be effected pursuant to aproportional allocation system whichwill ensure that no Client Account willbe favored over any other ClientAccount. In the event that the numberof shares of a particular stock which allof the Funds or Large Accounts proposeto sell on a given day is less than thenumber of shares of such stock whichall the Funds or the Large Accountspropose to buy, the direct cross-tradeopportunity will be allocated amongpotential buyers on a pro rata basis.Thus, any Client Accounts that invest inthe Funds will have an opportunity toparticipate on a proportional basis in allcross-trade transactions during theoperation of the cross-trading program.

11. Northern Trust states that whendirect cross-trades occur between theFunds and one or more of the LargeAccounts, the transactions would beeffected only if the following conditionsare satisfied: (i) The Large Account'sfiduciary, which is independent ofNorthern Trust and .its affiliates, is fullyinformed in writing of the cross-trading

Northern Trust currently uses Interactive DataSystems, Inc. (ISDI) as its primary source to valuethe stocks in the Funds. ISDI is a widely usedindependent pricing service and gives NorthernTrust electronic access to stock prices. The stocksare valued at the composite closing price for theday. Thus, cross-trades between the Funds wouldbe executed at the composite closing price for thestocks involved as provided by IDSI. Northern Trusthas access to other independent pricing services inthe event that ISDI does not price a particular stock.Northern Trust states that in no event will it usemore than one pricing service to price a particularsecurity in a cross-trade. In addition, theindependent pricing services used by NorthernTrust report the prices of all securities in U.S.Dollars, even if the security Is officiallydenominated in a foreign currency. Consequently,Northern Trust has no discretion over pricequotations and how price quotations are convertedinto U.S. Dollars from the applicable foreigncurrency. Northern Trust will maintain records ofthe prices at which all cross-trades are executed.

technique prior to the transactions; (ii)such fiduciary provides advance writtenapproval, authorizing Northern Trust toutilize the cross-trade technique toeffect the transactions as part of theLarge Account's portfolio restructuringprogram; (iii) such fiduciary'sauthorization is terminable at will bythe Large Account, without penalty tothe Large Account, upon receipt byNorthern Trust of written notice oftermination (as described in condition(f)(2) above); and (iv) the LargeAccount's fiduciary is informed inwriting of the results of all direct cross-trading transactions within 45 days ofthe completion of th6 Large Account'sportfolio restructuring program. Inaddition, Northern Trust states that ifthe restructuring program takes longerthan three months to complete, interimreports of the results of all transactionswill be made within 30 days of the endof each three-month period.

Finally, Northern Trust will provideto each Client Plan and NTC Plan whichinvests in a Fund, prior to any cross-trading by a Fund, information whichdescribes the existence of the cross-trading program, the "trigger events"which will create cross-tradeopportunities, and the pricingmechanism that will be utilized forstocks purchased or sold by the Funds.Such information will also disclose theallocation methods and otherprocedures or restrictions implementedby Northern Trust for the cross-tradingprogram. Northern Trust states that anyClient Plan or NTC Plan whichsubsequently invests in a Fund will beprovided the same information prior toor immediately after such plan's initialinvestment in a Fund.

12. In summary, the'applicantrepresents that the proposedtransactions will satisfy the statutorycriteria of section 408(a) of the Act andsection 4975 of the Code because,among other things: (a) The Index andModel-Driven Funds will buy or sellstocks in the proposed cross-tradingprogram only in response to various"trigger events" which result fromchanges directed by independentsources that are not within NorthernTrust's control; (b)the Large Accountswill engage in cross-trades only insituations where Northern Trust doesnot have any discretion for theinvestment decision made by a LargeAccount and the Large Account'sfiduciary provides advance writtenapproval authorizing Northern Trust toutilize the cross-trading technique toeffect such transactions; (c) all cross-trades will occur within three businessdays of the "triggering.event 'necessitating the purchase or sale; (d)

the price for the stocks will be set at theclosing price for those stocks on the dayof trading, unless the stock was addedto or deleted from an index underlyinga Fund after the close of trading, inwhich case the price will be the openingprice for the stock on the next businessday after the announcement of theaddition or deletion; (e) the Funds andLarge Accounts will save significantamounts of money on brokeragecommissions and other transactioncosts; and (f) Northern Trust will receiveno additional compensation as a resultof the proposed cross-trades.FOR FURTHER INFORMATION CONTACT: Mr.E.F. Williams of the Department,telephone (202) 219-8883. (This is nota toll-free number.)

Fidelity Management Trust Co. Locatedin Boston, MA

[Application No. D-92821

Proposed Exemption

The Department is consideringgranting an exemption under theauthority of section 408(a) of the Actand section 4975(c)(2) of the Code andin accordance with the procedures setforth in 29 CFR part 2570, subpart B (55FR 32836, 32847, August 10, 1990). Ifthe exemption is granted the restrictionsof sections 406(a)(1)(A) and 406(b)(2) ofthe Act and the sanctions resulting fromthe application of section 4975 of theCode, by reason of section 4975(c)(1)(A)of the Code, shall not apply to theproposed cross-trading of securities byFidelity Management Trust Company(Fidelity) on behalf of employee benefitplan accounts for which Fidelity acts asa fiduciary.

Part I-General Conditions

(A) Each Plan participating inFidelity's cross-trading program hasassets of at least $25 million;

(B) A Plan's participation in the cross-trade program is subject to a writtenauthorization executed in advance by afiduciary with respect to each suchPlan;

(C) The authorization referred to insection (B) of this Part I is terminable atwill without penalty to such Plan, uponreceipt by Fidelity of written notice ofsuch termination;

(D) Before an authorization is made,the authorizing Plan fiduciary must befurnished with any reasonably availableinformation necessary for theauthorizing fiduciary to determinewhether the authorization should bemade, including (but not limited to) acopy of this exemption, an explanationof.how the authorization may be-terminated, a detailed disclosure of theprocedures implemented in Fidelity's

64978


cross-trade practices, and any otherreasonably available informationregarding the matter that the authorizingfiduciary requests;

(E) Each cross-trade transactioninvolves only securities for which thereis a generally recognized market;

(F) Each cross-trade transaction iseffected at the current market value forthe security on the date of thetransactions, which shall be, for equitysecurities, the closing price for thesecurity on the date of the transaction,and for debt securities, as determined inaccordance with paragraph (b) of Rule17a-7 issued by the Securities andExchange Commission (SEC) under theInvestment Company Act of 1940;

(G) Fidelity will not charge any Planaffected by a cross-trade transaction anyfee or commission for such transaction;

(H) At least every three months, andnot later than 45 days following theperiod to which it relates, Fidelity willfurnish the authorizing Plan fiduciarywith a report disclosing: (1) A list of allcross-trade transactions engaged in onbehalf of the Plan, and (2) with respectto each cross-trade transaction, thehighest and lowest prices at which thesecurities involved in the transactionwere traded on the date of suchtransaction;

(I) The authorizing Plan fiduciary willbe furnished with a summary of certainadditional information at least once peryear. The summary must be furnishedwithin 45 days after the end of theperiod to which it relates, and mustcontain the following: (1) A descriptionof the total amount of Plan assetsinvolved in cross-trade transactionsduring the period, (2) a description ofFidelity's cross-trade practices, (3) astatement that the Plan fiduciary'sauthorization of cross-trade transactionsmay be terminated upon receipt byFidelity of the fiduciary's written noticeto that effect, and (4) a statement thatthe Plan fiduciary's authorization of thecross-trade transaction will continue ineffect unless it is terminated; and

(J) The Accounts involved in cross-trade transactions will not includeassets of any Plan established ormaintained by Fidelity or its affiliates.

Part Il-Specific Conditions(A) Index Accounts: (1) The index of

the account is based on an index whichrepresents the investment performanceof a specific segment of the publicmarket for equity or debt securities inthe United States and/or foreigncountries. The organization creating andmaintaining the index must be: (a)Engaged in the business of providingfinancial information, evaluations,advice or securities brokerage services

to institutional clients, (b) a publisher offinancial news or information, or (c) apublic stock exchange or association ofsecurities dealers. The index must becreated and maintained by anorganization independent of Fidelityand its affiliates. The index must be agenerally accepted standardized indexof securities which is not specificallytailored for the use of Fidelity or itsaffiliates.

(2) The transaction takes place withinthree business days of the "triggeringevent" giving rise to the cross-tradetransaction. A triggering event isdefined as:

(a) A change in the composition orweighting of the index underlying an IndexAccount; or

(b) A change in the overall level ofinvestment in an Index Account as a resultof investments and withdrawals made on theIndex Account's opening date (the regularly-scheduled date on which investments in orwithdrawals from an Index Account may bemade).

(3) Fidelity maintains or causes to bemaintained for a period of six yearsfrom the date of the transaction therecords necessary to enable the personsdescribed in section (4) of this Part 11 (A)to determine whether the conditions ofthis exemption have been met, exceptthat a prohibited transaction will not beconsidered to have occurred if, due to .circumstances beyond the control ofFidelity or its affiliates, the records arelost or destroyed prior to the end of thesix-year period.

(4)(a) Except as provided insubsection (b) of this section (4) andnotwithstanding any provisions ofsubsections (a)(2) and (b) of section 504of the Act, the records referred to insection (3) of this Part II areunconditionally available at theircustomary location for examinationduring normal business hours by-

(1) Any duly authorized employee orrepresentative of the Department or theInternal Revenue Service,

(2) Any fiduciary of a Planparticipating in an Index Account whohas authority to acquire or dispose ofthe interests of the Plan or any. dulyauthorized employee or representativeof such fiduciary,

(3) Any contributing employer to anyPlan participating in an Index Accountor any duly authorized employee orrepresentative of such employer, and

(4) Any participant or beneficiary ofany Plan participating in an IndexAccount, or any duly authorizedemployee or representative of suchparticipant or beneficiary.

(b) None of the persons described inparagraphs (2) through (4) of subsection(a) of this section (4) shall be authorized

to examine trade secrets of Fidelity, anyof its affiliates, or commercial orfinancial information which isprivileged or confidential.

(B) Managed Accounts: (1) Anindependent fiduciary of each Planmust specifically authorize each cross-trade transaction in accordance with thefollowing procedure:

(a) No more than three business daysprior to the execution of any cross-tradetransaction, Fidelity must inform anindependent fiduciary of each Planinvolved in the cross-trade transactionthat Fidelity proposes to buy or sellspecified securities in a cross-tradetransaction if an appropriateopportunity is available, the currenttrading price for such securities, and thetotal number of shares to be acquired orsold by each such Plan.

(b) Prior to each cross-tradetransaction, the transaction must beauthorized either orally or in writing bythe independent fiduciary of each Planinvolved in the cross-trade transaction;

(c) If a cross-trade transaction isauthorized orally by an independentfiduciary, Fidelity will provide writtenconfirmation of such authorization in amanner reasonably calculated to bereceived by such independent fiduciarywithin one business day from the dateof such authorization;

(d) The authorization referred to inthis Part II(B) will be effective for aperiod of three business days; and

(e) No more than ten days after thecompletion of a cross-trade transaction,the independent fiduciary authorizingthe cross-trade transaction must beprovided a written confirmation of thetransaction and the price at which thetransaction was executed;

(2) A cross-trade transaction will beeffected only where the transactioninvolves less than five percent of theaggregate average daily trading volumefor the securities involved in thetransaction for the week immediatelypreceding the authorization of thetransaction. A cross-trade transactionmay exceed this limit only by expressauthorization of independent fiduciarieson behalf of Plans affected by thetransaction; and

(3) The cross-trade transaction iseffected at a price which is within tenpercent of the closing price of thesecurity on the day before the date onwhich Fidelity receives authorization bythe independent Plan fiduciary toengage in the cross-trade transaction.

Part 11l-Definitions

(A) "Account" means an accountholding assets of one or more employeebenefit plans which are subject to the

64979


Act (the Plans), for which Fidelity or anaffiliate of Fidelity acts as a fiduciary;

(B) "Affiliate" means any person,directly or indirectly through one ormore intermediaries, controlling,controlled by, or under common controlwith Fidelity;

(C) "Cross-trade transaction" means apurchase and sale of securities betweenAccounts for which Fidelity or anaffiliate of Fidelity acts as a trustee orinvestment manager;

(D) "Index Account" means anAccount for which Fidelity and the Plansponsor or other named fiduciary haveagreed that the investment of the assetsin question will be designed to replicatethe capitalization-weighted compositionof a stock or bond index; and

(E) "Managed Account" means anAccount for which Fidelity and the Plansponsor or other named fiduciary haveagreed that the investment of the assetsin question will be managed actively atthe discretion of Fidelity, pursuant towritten guidelines as to which types ofsecurities to buy or sell for the Account.

Summary of Facts and Representations1. Fidelity is a bank and trust

company domiciled in and charteredunder the banking laws of theCommonwealth of Massachusetts.Fidelity is a wholly-owned subsidiary ofFMR Corp., an organization which,through its subsidiaries, provides abroad range of financial services to avariety of clients, including individuals,institutions, registered investmentcompanies and employee benefit plans.Fidelity serves as investment manageror trustee for a substantial number ofqualified pension and profit sharingplans (Plans), and serVes as custodianfor individual retirement accounts andaccounts maintained pursuant to section403(b)(7) of the Code. Fidelity currentlyhas more than $20 billion in assetsunder management. Plan accountsmaintained and managed by Fidelity areof two general categories: IndexAccounts and Managed Accounts.

2. Under the terms of Index Accounts,Fidelity and the Plan sponsor(s) or othernamed fiduciary have agreed that theassets in question will be managed inaccordance with a passive investmentmodel which is designed to allocate theinvestment of assets in the equity ordebt securities of certain companiessolely pursuant to an index maintainedand published by a third party.Examples of such indices are the S&P500 Index, an index of equity securities,and the Lehman Brothers Bond Indices,which are indices of debt securities. 5

'The applicant represents that indices of debtsecurities, such as the Lehman Brothers Bond

The investment model for some IndexAccounts may refer to a published indexas modified pursuant to writtenguidelines which have been approvedby the Plan sponsor or other namedfiduciary. The organizationsmaintaining and publishing the indicesutilized by the Index Accounts in allinstances will be independent ofFidelity and its affiliates, and suchorganizations are engaged in thebusiness of providing financialinformation, evaluations, advice orsecurities brokerage services toinstitutional clients, or publishing suchinformation. Additionally, some indicesare maintained by public stockexchanges and associations of securitiesdealers.

3. Managed Accounts are those forwhich Fidelity provides active portfoliomanagement. Investment decisions aregenerally subject to the Fidelityinvestment manager's discretion, subjectto general written guidelines as towhich types of securities to acquire orsell for the Account. For some ManagedAccounts, investment selections arebased in part on the correspondingdecisions made on behalf of registeredinvestment companies or institutionalaccounts for which Fidelity or itsaffiliate serves as the investmentadvisor.

4. Frequent purchases and sale ofsecurities in the Index Accounts arerequired to accomplish portfoliobalances in accordance with theparticular index models in use.Securities sales and purchases forManaged Accounts result from theactive decision making by the Accountmanager. In addition, some securitiestransactions may be prompted by aclient Plan's request to add funds to, orwithdraws funds from, an Account.Under any of these circumstances,Fidelity's disposition of a particularsecurity for one Account may involve asecurity which a portfolio manager mayneed or desire for another Account,presenting an opportunity to savesubstantial commissions for both theliquidating Account and the acquiringAccount. This saving is enabled by across-trade transaction, which involvesmatching Fidelity's sell orders for aparticular day with its buy orders for thesame day, and the execution of tradesbetween the Accounts in off-markettransactions. Under current procedures,all securities transactions, includingcross-trades between accountsmaintained by Fidelity, are executed by

Indices, consist primarily of high-quality fixed-income securities representing the U.S. government,corporate, and mortgage-backed securities sectors ofthe bond market in the United States.

a broker on behalf of a purchasing orselling Account, at the direction ofFidelity, dealing with a second brokeracting on behalf of a purchasing orselling second party.

5. Fidelity proposes to take advantageof opportunities to cross trade Accountsecurities directly between theAccounts, or directly with other clientaccounts for which Fidelity is theinvestment manager, or with mutualfunds or institutional accounts forwhich Fidelity is the investmentadvisor. Fidelity maintains thatcomparable trades on the open marketbetween unrelated parties would requirea commission equal to between four andfive cents per share for each sale orpurchase transaction. However, Fidelityproposes to execute cross-tradetransactions on behalf of the Accountswithout charging any commissions. Byparticipating in its cross-tradingprogram, Fidelity represents that theAccounts will incur substantially lowerexpenses in relation to the affectedtransactions.

Fidelity also represents that byparticipating in its cross-tradingprogram, the Accounts will benefit bynot incurring the cost, in terms of price,of dealing with a person or firm actingas "market maker" for the particularsecurity involved in a cross-tradetransaction. This cost is measured bythe spread between the asking andbidding prices for the security.Additionally, Fidelity represents thatwhere trading of a particular security is"thin" (limited in numbers of sharesavailable), participation in the cross-trading program may enable theAccounts to obtain early opportunitiesto acquire or sell such securities.

6. Participation by Plans, through anyof the Accounts, in Fidelity's cross-trading program, will be subject toseveral conditions which will apply toboth Index Accounts and ManagedAccounts. Participation by Plans inFidelity's cross-trade program is limitedto'Plans with assets of at least $25million. Further, Accounts involved inFidelity's cross-trade transactions willnot include assets of any Planestablished or maintained by Fidelity orits affiliates. The proposed exemptionwill apply to cross-trade transactionsinvolving only securities for whichthere is a generally-recognized market.Each cross-trade transaction will beeffected at the current market value ofthe security on the date of thetransactions. For equity securities the"current market value" will be theclosing price for the security on the dateof the transaction. For debt securitiesthe "current market value" will bedetermined pursuant to paragraph (b) of

64980


Rule 17a-7 issued by the Securities andExchange Commission, which containsfour possible means of determining"current market" value depending onsuch factors as whether the security isa reported security and whether itsprincipal market is an exchange. APlan's participation in Fidelity's cross-trading program must be authorized inwriting, prior to the execution of anyspecific cross-transaction, by a Planfiduciary which is independent ofFidelity, and such authorization isterminable at will upon written noticeby such independent fiduciary. Prior toany such authorization" Fidelity willprovide the authorizing Plan fiduciarywith all materials necessary to permit anevaluation of the cross-trade program.Such materials will include a copy ofthis exemption, if granted, anexplanation of how the authorizationmay be terminated, a description ofFidelity's cross-trade practices, and anyother available information which theauthorizing Plan fiduciary mayreasonably request. Fidelity will notcharge any commission or fee for thecross-trading transactions, and nopenalty or other charge will result fromtermination of a Plan's participation inthe cross-trading program.

7. After a Plan's participation inFidelity's cross-trading program isauthorized, Fidelity will furnishperiodic reports to the authorizing Planfiduciary. At least once every threemonths, and not later than 45 daysfollowing the period to which it related,the authorizing Plan fiduciary will befurnished a report disclosing: (a) A listof all cross-trade transactions engaged inon behalf of the Plan, and (b) withrespect to each cross-trade transaction,the highest and lowest prices at whichthe securities involved in thetransaction were traded on the date ofsuch transaction. Additionally, at leastonce each year, within 45 days after theend of the relevant period, theauthorizing Plan fiduciary will befurnished with a report which includesthe following: (a) A description of thetotal amount of Plan assets involved incross-trade transactions during theperiod, (b) a description of Fidelity'scross-trade practices, (c) a statement thatthe Plan fiduciary's authorization ofcross-trade transactions may beterminated upon receipt by Fidelity ofthe fiduciary's written notice to thateffect, and (d) a statement that the Planfiduciary's authorization of the cross-trade transaction will continue in effectunless it is terminated.

8. The Plans' participation inFidelity's cross-trading program throughthe Index Accounts will be subject tocertain special conditions. With respect

to cross-trades involving IndexAccounts, the proposed exemption islimited to transactions which take placewithin three business days of the"triggering event" giving rise to thecross-trade transaction. A "triggeringevent" is defined as: (1) A change in thecomposition or weighting of the indexunderlying an Index Account, or (2) achange in the overall level of investmentin an Index Account as a result ofinvestments and withdrawals made onthe Fund's opening date (the regularly-scheduled date on which investments inor withdrawals from an Index Accountmay be made).

In connection with cross-tradetransactions involving Index Accounts,Fidelity is also required to maintain, forat least six years, records necessary toenable a determination of whether theconditions of this exemption, if granted,have been satisfied. Such records are tobe made available to: (a) Any dulyauthorized employee or representativeof the Department or the InternalRevenue Service, (b) any fiduciary of aPlan participating in an Index Accountwho has authority to acquire or disposeof the interests of the Plan or any dulyauthorized employee or representativeof such fiduciary, (c) any contributingemployer to any Plan participating in anIndex Account or any duly authorizedemployee or representative of suchemployer, and (d) any participant orbeneficiary of any Plan participating inan Index Account, or any dulyauthorized employee or representativeof such participant or beneficiary.

9. The Plans participation inFidelity's cross-trade program throughthe Managed Accounts is also subject tocertain special conditions. In addition torequiring a general authorization of aPlan's participation in Fidelity's cross-trade program, an independent fiduciaryof each Plan with assets in a ManagedAccount must specifically authorizeeach cross-trade transaction involvingthat Managed Account. Any suchauthorization is effective only for aperiod of three business days and willbe subject to pricing and volume14nitations, described below. Theauthorization to proceed with thetransaction may be either oral orwritten. If a cross-trade transaction isauthorized orally by an independentfiduciary, Fidelity will provide a writtenconfirmation of such authorization in amanner reasonably calculated to bereceived by such independent fiduciarywithin one business day of suchauthorization. Subsequently, after thecross-trade transaction is consummated,the Plan fiduciary will be sent a writtenconfirmation of the cross-trade,including the price at which it was

executed, within ten days of thecompletion of the transaction.

A cross-trade transaction will beeffected on behalf of a ManagedAccount only where the trade involvesless than five percent of the aggregateaverage daily trading volume for thesecurities involved in the transaction forthe week immediately preceding theauthorization of the transaction. Across-trade transaction may exceed thislimit only by express written or oralauthorization of an independentfiduciary on behalf of the Plans affectedby the transaction. With respect topricing, a cross-trade may not be madeat a price which differs by more than tenpercent from the price at the close onthe day before specific authorizationwas provided by an independentfiduciary.

10. Fidelity represents that it isconceivable that situations will arise inwhich it will be necessary to allocatecross-trade opportunities among severalclient accounts. In this regard, theapplicant represents that the issuespresented in allocating cross-tradeopportunities among clientaccounts areno different than the issues whichFidelity must face daily in determiningthe allocation of limited investmentopportunities among client accounts.Fidelity represents that it will makethese decisions considering all therelevant facts and circumstances in amanner which it believes to beconsistent with its fiduciaryresponsibilities under the Act andwhich is equitable to all accountsinvolved in suchallocation decisions.Fidelity will consider, among otherthings the relative liquidity needs of theclient accounts, the composition of theportfolios and the number of cross-tradeopportunities which have been madeavailable to the client accounts. In thisregard, Fidelity does not believe thanany automatic allocation system wouldbe appropriate because It wouldinterfere with the proper discharge ofthe fiduciary duties of an investmentmanager.6

11.ln summary, the applicantrepresents that the proposedtransactions satisfy the criteria ofsection 408(a) of the Act for thefollowing reasons: (a) An independentPlan fiduciary must provide writtenauthorization, terminable at will andwithout penalty, for each Plan'sparticipation in the cross-tradingprogram; (b) Each Managed Accountcross-trade transaction, which must

6 The Department is not proposing, nor is theapplicant requesting, any relief for any prohibitedtransaction which may arise from Fidelity'sallocation of investment opportunities amongaccounts over which it has investment discretion.

64981

9 Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Notices

satisfy certain price and volumerequirements, must be specificallyauthorized orally or in writing by theindependent fiduciary of each Planaffected by the transaction; (c) Cross-trades involving Index Accounts willresult solely from "triggering events"and, Fidelity will maintain recordsnecessary to determine the IndexAccounts' compliance with theconditions of the exemption; (d) Allcross-trades will be executed at thecurrent market price for the security onthe date of the transaction; (e) Allsecurities involved in cross trades willbe ones for which there is a generallyrecognized market; (f) Fidelity willreceive no fees or commissions as aresult of the proposed cross trades; (g)Plans participating in the cross-tradingprogram will realize savings due toeliminated brokerage commissions; (h)The Plans participating in the cross-trade program will be large Plans, withassets of at least $25 million; and (i) ThePlans participating in the cross-tradeprogram will not include any Planestablished or maintained by Fidelity orits affiliates.FOR FURTHER INFORMATION CONTACT:Ronald Willett of the Department,telephone (202) 219-8881. (This is nota toll-free number.)Retirement Plan for Employees, HolsumBakery, Inc. (the Plan) Located inPhoenix, AZ

[Application No. D-9457)Proposed Exemption

The Department is consideringgranting an exemption under theauthority of section 408(a) of the Actand section 4975(c)(2) of the Code andin accordance with the procedures setforth in 29 CFR part 2570. subpart B (55FR 32836, 32847, August 10, 1990). Ifthe exemption is granted, therestrictions of sections 406(a), 406 (b)(1)and (b)(2) of the Act and the sanctionsresulting from the application of section4975 of the Code, by reason of section4975(c)(1) (A) through (E) of the'Code,shall not apply to the proposed sale (theSale) by the Plan of certain improvedreal property (the Property) to HolsumBakery, Inc. (the Employer), a party ininterest with respect to the Plan.

This proposed exemption isconditioned upon the followingrequirements: (1) The Sale is a one-timecash transaction; (2) the Plan is notrequired to pay any commissions, costsor other expenses in connection withthis transaction; (3) the Property isappraised by qualified, independentappraisers; (4) the sales price for theProperty is the greater of either: (a)$250,000, representing the original

amount paid by the Plan at the time ofacquisition; or (b) its fair market valueon the date of the Sale; (5) anindependent, qualified fiduciary, whohas made an initial determination thatthe proposed sale is appropriate for thePlan, monitors its terms for the Plan;and (6) within ninety days of thepublication in the Federal Register ofthe grant of this notice of proposedexemption, the Employer files Forms5330 with the Internal Revenue Service(the Service) and pays all applicableadditional excise taxes that are due byreason of the prohibited leasetransactions.

Summary of Facts and Representations1. The Plan is a defined benefit plan,

sponsored by the Employer. TheEmployer, an Arizona corporation,engages primarily in the business ofpreparing and distributing bread andother bakery products. As of December31, 1992, the Plan had 146 participantsand total assets of $1,891,210. Thetrustee of the Plan is Bank One, Arizona,N.A., formerly known as ValleyNational Bank of Arizona, N.A. (theTrustee). The Trustee possesses the soleinvestment authority for the Plan withrespect to this asset.

2. Effective December 31. 1989. theEmployer "froze" the Plan anddiscontinued future benefits accrualsunder the Plan, providing retirementbenefits for service after that datethrough a 401(k) plan. On June 24, 1993,the Trustee applied to the InternalRevenue Service (the Service) for aruling to the effect that the terminationof the Plan would not adversely affectits tax-qualified status.

3. In order to enable finaldistributions to the participants, theassets of the Plan must be liquidated.Among the Plan's assets is the Property,which consists of a single-story, grade-level industrial building situated on a37,500 square-foot parcel of land locatedat 17815 North 25th Avenue, Phoenix,Arizona. Adjacent to the Property is aparcel of land owned by the Employer.In 1985, the Plan acquired the Propertyfrom the Employer (the Purchase) forthe total cash consideration of $250,000pursuant to the terms and conditions ofprohibited Transaction Exemption (PTE)85-130, which was issued by theDepartment on July 26, 1985 at 50 FR30544.7 Under PTE 85-130, the Trustee,as the independent, qualified fiduciary,provides exclusive representation of thePlan's interests under the Lease with the

7On May 15,1984. Warren L Searles, STA. ASAof Searles & Campbell, real estate appraiser andconsultants located in Scottsdale, Arizona placedthe fair market value of the Property at $280,000and its fair market rental value at $28.897.

Employer. In such capacity, the Trusteehas monitored the Lease on behalf of thePlan.

Contemporaneously with itsacquisition of the Property, the Plan, aspermitted by PTE 85-130, commencedleasing the property to the Employer foran initial annual rental of $30,600 underthe terms of a written lease (the Lease)having a five-year duration. The Leaseprovides for annual adjustments of therental based upon the "All UrbanIndex" of the Consumer Price Index(CPI). However, in no event shall therental rate be less than the initial rate of$30,600 per annum. PTE 85-130 alsoprovides that the Employer pay all costsrelating to the Property, includingmaintenance, utilities, taxes, andinsurance.

In accordance with the terms of theLease, and as further authorized underPTE 85-130, the Employer is permittedto renew the Lease for up to twosuccessive periods of five years each.On August 31, 1990, the Employerrenewed the Lease for an additional fiveyears through September 15, 1995. TheEmployer represents that it has the rightto renew the Lease through September2000.

At present, the Employer pays thePlan a monthly rental of $3,326 and haspaid $279,540 in rental as of September1993. The Employer represents that allpayments under the Lease have beenpaid in a timely manner and there havenever been any defaults ordelinquencies by the Employer otherthan as described below (see Item #4below).

4. An audit of the Plan by the LosAngeles Area office of the Department(the Area Office) disclosed that the Planhad paid real estate taxes, licensing fees,and one appraisal fee betweenSeptember 23, 1985 and October 28,1991. In this regard, the Plan's AdvisoryCommittee received written notificationfrom the Area Office on May 26, 1993that certain provisions of PTE 85-130requiring the Employer pay all costsrelating to the Property, includingmaintenance, utilities, taxes andinsurance had been violated, resultingin prohibited transactions. By letterdated October 21, 1992. the Area Officestated that on August 27, 1992, theEmployer reimbursed the Plan in theamount of $33,901 for all property-related expenses, including lostopportunity income between September23, 1985 and July 31, 1992. TheEmployer also represents that onFebruary 2, 1993. excise taxes in theamount of $11,473 were paid to theService for the years ending December1989, 1990 and 1991. The Employerrepresents that within ninety days of the

64982

Federal Register / Vol. 58, No. 236 / Friday, December 10, .1993 / Notices

publication in the Federal Register ofthe grant of this notice of proposedexemption, the Employer will file Forms5330 with the Service and pay allapplicable additional excise taxes thatare due by reason of prohibited leasetransactions from 1992 until the date theexemption is granted.a

5. The Employer represents that It isan appropriate purchaser of the Propertybecause it utilizes the Property In itsdaily operations and is Involved in along-term lease arrangement with thePlan. In addition, the Employerrepresents that the proposed transactionwill allow the Plan to avoid costsassociated with a sale to a third partybecause the Plan will not pay any feesor commissions in connection with theSale. Therefore, the Employer requestsan administrative exemption from theDepartment to permit Holsum'spurchase of the Property from the Planunder the terms and conditionsdescribed herein.

6. The Property has been appraised byMessrs. Wendell L. Montandon, MAIand R. John McDonald, Analyst,qualified appraisers affiliated with thereal estate appraisal firm of WiniusMontandon, Inc. (the Appraisers)located in Phoenix, Arizona. Mr.Montandon represents that WiniusMontandon, Inc. is unrelated to andindependent of the Employer or itsaffiliates. In an appraisal report datedFebruary 26, 1993, the Appraisers,placed the fair market value of theleased fee Interest in the Property at$210,000 as of February 15, 1993.'

By letter dated July 9, 1993, Mr.Montandon represented that theappraisal took into consideration anyspecial value which the Property mighthave to the Employer by reason of itsproximity to other real property ownedby the Employer. Mr. Montandon statedthat the Employer's ownership ofadjacent real estate did not impact onthe fair market value of the Propertybecause the Employer's existing land is

*In March 1990, the Trustee discovered that ithad not properly adjusted Lease payments to reflectchanges in the CPI as required under the terms ofthe Lease (see #3 above) for all Lease payments dueSeptember 1, 1966 through 1989. Accordingly onJuly 19, 1990, the Employer made additional leasepayments of $9,989 to reflect the increases in themonthly Lease payments as required by the termsof the Lease. The trustees represents that therequired annual rental adjustments have beenpro ery Implemented for the years between 1990and 1993. The Employer further represents that onFebruary 2. 1993, additional excise taxes in theamount of $97 were paid to the Service for the yearsending December 1989 and 1990.

eThe Appraisers also included in their letterdated February 26. 1993. a second valuation of theProperty which did not take the Lease intoconsideration. This alternative valuation placed thefair market value of the fee simple interest of theProperty at $165,000.

adequate for purposes of its economicpursuits.

Because the fair market value of theBuilding is less than its originalpurchase price, the Building will bepurchased by the Employer for$250,000, the originalpurchase pricepaid by the Plan. In addition, the Planwill not be required to pay any realestate fees or commissions inconnection with the Sale.

7. The Trustee, a national bank, willserve as independent fiduciary for thePlan with respect to the Sale. After anevaluation of the terms of the Sale, theTrustee represents that the Sale is in thebest interests of the Plan and itsparticipants. Tle Sale will enable thecontinuing liquidation of the Plan'sassets by facilitating a disposition of theProperty, without cost to the Plan, at aprice which is in excess of theProperty's fair market value. TheTrustee acknowledges its responsibilityto monitor the terms of the Sale onbehalf of the Plan.

8. In summary, it is represented thatthe proposed transaction will satisfy thestatutory criteria for an. exemptionunder section 408(a) of the Act because:(a) the Sale will represent a one-timecash transaction; (b) the Plan will not berequired to pay any commissions, costsor other expenses in connection withthe transaction; (c) the Property will beappraised by qualified, Independentappraisers; (d) the sales price for the'Property will be the greater of: (1)$250,000, representing the originalamount paid by the Plan at the time ofacquisition; or (2) its fair market valueon the date of the Sale; and (e) theTrustee, as an independent fiduciary forthe Plan, will make an initialdetermination that the proposed sale isappropriate for the Plan and willmonitor its terms for the Plan; and (f)within ninety of the publication in theFederal Register of the grant of thisnotice of proposed exemption, theEmployer will file Forms 5330 with theService and pay all applicableadditional excise taxes that are due byreason of the prohibited leasetransactions.FOR FURTHER INFORMATION CONTACT: Ms.Kathryn Parr of the Department,telephone (202) 219-8971. (This is nota toll-free number.)

W.I. Casey Trucking & Rigging Co., Inc.Employees Profit Sharing Plan andTrust (the Plan) Located in Union, NJ

lApplication No. D-95061Proposed Exemption

The Department is consideringgranting an exemption under theauthority of section 408(a) of the Act

and section 4975(c)(2) of the Code andin accordance with the procedures setforth in 29 CFR part 2570, subpart B (55FR 32836, 32847, August 10, 1990). Ifthe exemption is granted, therestrictions of sections 406(a), 406(b)(1)and (b)(2) of the Act and the sanctionsresulting from the application of section4975 of the Code, by reason of section4975(c)(1) (A) through (E) of the Code,shall not apply to: (1) The proposedseven-year loan of $300,000 (the Loan)by the Plan to W. J. Casey Trucking &Rigging Co., Inc. (the Employer), a partyin interest with respect to the Plan; and(2) the proposed personal guarantees ofthe Employer's obligations under theLoan by James P. and Nicholas J. Biondi(the Biondis), parties in interest withrespect to the Plan.

.This proposed exemption isconditioned upon the following.requirements: (a) All terms andconditions of the Loan are at least asfavorable to the Plan as those obtainablein an arm's-length transaction with anunrelated party; (b) the Loan will notexceed twenty-five percent of the Plan'sassets at any time during thetransaction; (c) the Loan is secured bya first lien interest on certain equipment(the Equipment), which has beenappraised by a qualified, independent

,appraiser to ensure that the fair marketvalue of the Equipment is at least 200percent of the amount of the Loan; (d)the Employer's obligations under theLoan are personally guaranteed by theBiondis; (e) the fair market value of theEquipment remains not less than 200percent of the outstanding balance ofthe Loan throughout the duration of theLoan; (f) an independent, qualifiedfiduciary determines on behalf of thePlan that the Loan is administrativelyfeasible, in the best interests of the Plan,and protective of the Plan and itsparticipants and beneficiaries; and (g)the independent, qualified fiduciarymonitors complianc with the terms andconditions of the exemption and theLoan throughout the duration of thetransaction, taking any action necessaryto safeguard the Plan's interest,including foreclosure on the Equipmentin the event of default.

Summary of Facts and Representations1. The Plan is a profit sharing plan

sponsored by the Employer, a NewJersey specialty trucking company. As ofDecember 31, 1992, the Plan had totalassets of $3,433,553 and twenty-oneparticipants. The trustees of the Plan arethe Biondis, who have the soleinvestment discretion over the Plan'sassets.

2. The Employer requests anadministrative exemption from the

64983


Department to permit the Plan to lend$300,000 to the Employer under theterms and conditions described below.The Employer represents that the Loanproceeds will be used to finance the$300,000 purchase price of a newheavy-duty specialized trailer (theTrailer) manufactured by IndustrieCometto of Cuneo, Italy. The Trailer willbe utilized by the Employer in itstrucking operation.

3. The Loan will be in a principalamount of $300,000. The applicantstates that at no time will the amount ofthe Loan represent more than twenty-five percent of the Plan's total assets.The Loan will be secured by a first lieninterest on the Equipment. TheEquipment consists of the Trailer andfive heavy-duty trailer/trucks (theTrucks) owned by the Employer. UCC-1 Filing Statements and a SecurityAgreement will be filed with the Clerkof Union County. New Jersey and theSecretary of the State of New Jersey toreflect the Plan's security interest in theEquipment. In addition, the Employerwill insure the Equipment against

casualty loss and will designate the Planas the loss payee of such insurance. TheLoan will also be guaranteed as tointerest and principal by the Trustees.The applicant has provided financialstatements which indicate that James P.Biondi and Nicholas J. Biondi's networth was $2,455,517 and $2,713,244,respectively, as of December 31, 1992,exclusive of the market value of theassets held in the Plan and variousindividual retirement accounts as ofsuch date.

4. The Loan will have a seven yearterm and will be evidenced by apromissory note (the Note). The Notewill require the Employer to make equalmonthly installments of principal andinterest amortized over the seven yearperiod. Interest will accrue on the Loanat a fixed rate of two percentage pointsabove the prime rate of First FidelityBank of Cranford, New Jersey (FirstFidelity) on the date the Loan is made.The terms of the Note provide that theLoan may be prepaid in full withoutpenalty. The Plan will not incur any

fees, commissions, or other expenses inconnection with the Loan.

First Fidelity has indicated it wouldcharge the Employer interest equal to itsprime lending rate plus one and one-half percentage points for a secured,five-year loan in the amount of$300,000. In addition, First Fidelitystates that it would charge the Employera facility fee of one-half of a percentagepoint, making the overall interest ratethe prime rate plus two percentagepoints for such loan.

5. H. Norman Shurts, an independentretail salesman for Mack Trucks, Inc.located in North Plainfield, New Jersey,appraised the Equipment (theAppraisals). Mr. Shurts represents thathe has more than twenty-five years ofexperience in selling both new and usedvehicles as well as appraising them. Inappraisal reports dated December 30,1992, Mr. Shurts placed the total fairmarket value of the Trucks at $327,500.A summary of the fair market values foreach Truck as determined by Mr. Shurtsis as follows:

Make Model Year Fair marketvalue

Mack ..................................................................................................................................................................... RW 633 1989 $45,000Mack .......................................................................................................................... ......................................... RW 633 1991 50,000Mack * RW6000K 1992 70,000Ma ck .................................................................................................................................................................... RIW 733 1986 37,500

Kenworth ............................................................................................................................................................. 548CH 1979 125,000

Total .............................................................................................................................................................. .......... 327,500

In an April 21, 1993 appraisal, Mr.Shurts valued the Trailer, which is anew Cometto 4-axle transport moduleand components. Mr. Shurts comparedthe Trailer to a Cometto module unit#25 which was recently appraised at$75,000. Taking into consideration theadditional modifications andimprovements to the Trailer, Mr. Shurtsplaced the fair market value of theTrailer at $300,000, which is equivalentto the purchase price. Mr. Shurtsrepresents that he has confirmed thisvalue with other users of this type ofheavy transport equipment. Thus, theaggregate fair market value of theEquipment is $627,500 (which is inexcess of 200 percent of the amount ofthe Loan).

6. Roch T. Williams, Esq., a partner inthe law firms of Snevily, Ely, Williams& Gurrieri located in Westfield, NewJersey, will serve as the independentqualified fiduciary on behalf of the Planwith respect to the Loan. Mr. Williamshas practiced law since 1958 and hassubstantial legal experience in the areasof commercial transactions, wills,probate and real estate law. Mr.

Williams represents that he is unrelatedto and independent of the Employer andits affiliates, including the Biondis. Mr.Williams states that he understands andacknowledges his duties,responsibilities, and liabilities in actingas a fiduciary with respect to the Plan,based upon consultation with counselexperienced with the fiduciaryresponsibility provisions of the Act.

Mr. Williams has reviewed the termsof the Loan and all of the documentsand relevant information in connectionwith the Loan, including the Appraisals.Mr. Williams states that the terms of theLoan compare favorably with the termsof similar transactions betweenunrelated parties as evidenced by theterms offered by First Fidelity (see Item#4). Mr. Williams believes that the Loanis in the best interests of the Planbecause it offers a guaranteed rate ofreturn of two percentage points abovethe prime rate on an adequately securedinvestment.

Mr. Williams has reviewed thecurrent investment portfolio of the Planand considered the diversification of thePlan's assets as well as the liquidity

needs of the Plan. Based on thisanalysis, Mr. Williams believes that the

roposed transaction would be in thebest interests of the Plan and itsparticipants and beneficiaries as aninvestment for the Plan's portfolio. Mr.Williams states that the Loan would bean appropriate and desirable investmentfor the Plan, based on the Loan's rate ofreturn, the collateral securing the Loan,the character and diversification of thePlan's other assets, and the projectedliquidity needs of the Plan.

Mr. Williams has reviewed thefinancial condition of the Employer inorder to establish Its ability to repay theLoan. In this regard, Mr. Williams statesthat he has examined the most recentfinancial statements for the Employer.Mr. Williams concludes that theEmployer will have sufficient cash tomake the requisite $4,601 monthlypayments as they fall due based uponthe Employer's current profit level, therecent satisfaction by the Employer ofprior indebtedness, and the expectedadditional revenues to be generated bythe addition of the Trailer. Mr. Williamshas also analyzed the financial

64984


statements for the Biondis and believesthat their aggregate net worth would bemore than sufficient to personallyguarantee the Employer's obligationsunder the Loan.Mr. Williams represents that he will

monitor the Loan throughout its entireduration and will take any appropriateaction necessary to protect the interestsof the Plan and its participants andbeneficiaries, including foreclosure onthe Equipment in the event of a default.Mr. Williams will monitor the conditionand adequacy of the Equipment ascollateral for the Loan to ensure that theLoan remains secured by collateralworth at least 200 percent of the Loanat all times.

Mr. Williams will monitor the Plan'sassets to ensure that the outstandingamount of the Loan will at all timesremain less than twenty-five percent ofthe Plan's total assets. Mr. Williams willrequire the Employer to provideadditional payments on the Loan to thePlan, if necessary, to reduce theprincipal amount of the Loan tomaintain the appropriate ratio betweenthe outstanding principal balance of theLoan and the Plan's total assets.

Mr. Williams has acknowledged hisresponsibility to monitor compliance ofall parties with the terms and conditionsof the proposed exemption, includingthe twenty-five percent limitation.

7. In summary, the applicantrepresents that the proposed transactionwill satisfy the statutory criteria for anexemption under section 408(a) of theAct because: (a) All terms andconditions of the Loan will be at leastas favorable to the Plan as thoseobtainable in an arm's-lengthtransaction with an unrelated party; (b)the amount of the Loan will not exceedtwenty-five percent of the assets of thePlan; (c) the Loan will be secured byEquipment valued by Mr. Shurts, anindependent appraiser, in excess of 200percent of the amount of the Loan; (d)the Employer's obligations under theLoan are personally guaranteed by theTrustees in their individual capacities;(e) the fair market value of the collateralremains not less than 200 percent of theoutstanding balance of the Loanthroughout the duration of the Loan; ()Mr. Williams, as the Plan'sindependent, qualified fiduciary, willdetermine on behalf of the Plan that theLoan is feasible, in the best interests ofthe Plan and protective of the Plan andits participants and beneficiaries; and(g) Mr. Williams will monitor the termsand conditions of the exemption and theLoan throughout the duration of thetransaction, taking any action necessaryto safeguard the Plan's interest,

including foreclosure on the Equipmentin the event of default.FOR FURTHER INFORMATION CONTACT: Ms.Kathryn Parr of the Department,telephone (202) 219-8971. (This is nota toll-free number.)

David Rothman, M.D. Employee'sPension Plan and David Rothman, MD.Employee's Profit Sharing Plan(collectively, the Plans) Located inMiami, FL

lApplication Nos. D-9575 and D-95761

Proposed Exemption

The Department is consideringgranting an exemption under theauthority of section 408(a) of the Actand section 4975(c)(2) of the Code andin accordance with the procedures setforth in 29 CFR part 2570, subpart B (55FR 32836, 32847, August 10, 1990). Ifthe exemption is granted the restrictionsof sections 406(a) and 406(b)(1) and(b)(2) of the Act and the sanctionsresulting from the application of section4975 of the Code, by reason of section4975(c)(1) (A) through (E) of the Codeshall not apply to the proposed cashsale (the Sale) of certain real property(the Property) by the individualaccounts of David Rothman, M.D. (Dr.Rothman) In the Plans to Dr. Rothman,a party In interest with respect to thePlans; provided that the considerationpaid for the Property is no less than thefair market value of the Property on thedate of the Sale as determined by aqualified, independent appraiser.

Summary of Facts and Representations

1. The Plans consist of two definedcontribution plans; a money purchaseplan and a profit sharing plan,respectively. As of December 31, 1992,the assets of the Plans totalled $748,166and the participants in each of the Plansconsisted of the same 4 individuals.,Excluding Dr. Rothman, the remaining 3participants in the Plans had the assetsin their respective individual accountsinvested entirely in certificates ofdeposit issued by banks. The individualaccounts in the Plans for Dr. Rothmanwere invested primarily in the Property,which, as of December 31, 1992,represented approximately 76 percent ofthe total assets in the Plans. 10

The sponsoring employer (theEmployer) of the Plans is a Floridaprofessional association engaged in the

to The Department notes that the decisions toacquire and hold the Property are governed by thefiduciary responsibility requirements of part 4,subtitle B, title I of the Act. In this regard, theDepartment herein is not proposing relief for anyviolations of part 4 of the Act which may havearisen as a result of the acquisition and holding ofthe Property.

practice of obstetrics and gynecologyand is located in Miami, Florida.

Dr. Rothman, who is the fiduciary'ofthe Plans, is also the sole officer,director, and owner of the Employer.

2. The Property was acquired by Dr.Rothman's individual accounts in thePlans on May 21, 1986, for theconsideration of $350,000 from anunrelated person. The Property consistsof approximately 4.328 acres located atthe NW. Corner of Sunset Dr. and SW,123rd Avenue in Miami, Dade County,Florida, and is vacant, unimprovedland. While the Property is zoned foragricultural purposes, the applicantrepresents that zoning variances couldbe obtained for building religious andeducational facilities and civicbuildings, but not for residentialconstruction. Also, the applicantrepresents that the Property is notlocated adjacent to any property ownedby a party in interest with respect to thePlan.

The Property has been appraised atthe behest of Dr. Rothman and hisformer wife at the time of their divorcein 1992. Mr. Lee H. Waronker, MAI,SRPA, Certificate No. 162 of Waronkerand Associates, Inc., Miami, Florida, asof July 19, 1992, determined that the fairmarket value of the Property was$540,000. Ms. Sue Slack, MAI of Slackand Johnston, Miami, Florida, as of July20, 1992, determined that the fairmarket value of the Property was$600,000.

3. The applicant represents that the.Property is subject to a QualifiedDomestic Relations Order (QDRO),entered August 4, 1993, by the CircuitCourt of the 11th Judicial Circuit in andfor Dade County; Florida. The QDROstates, inter alia, that the court entereda final judgment on August 21, 1992,dissolving the marriage between Dr.Rothman and Lidya Rothman (nowknown as Lidya Abramovic; hereinafterreferred to as Lidya Abramovici) and thecourt approved a Marital SettlementAgreement (the Agreement), datedAugust 3, 1992, between the parties.ttThe Agreement requires, inter olia, thatthe entry of a QDRO provide for thedivision and deposition of the accruedbenefits due Dr. Rothman under thePlans. As a consequence of the QDRO,the Property is to be either sold to thehighest bidder and the proceeds dividedequally between Udya Abramovici,individually, and Dr.- Rothman'sindividual accounts in the Plans; or thePlans are to convey a one-half interestin the Property to Lidya Abramovici.The QDRO also provides that both Dr.

"Lidya Abramovici is not a participant in thePlans.

64985


Rothman and Lidya Abramovici areentitled to bid for the Property againsteach other or any other individuals.

4. The applicant seeks an exemptionfrom the prohibited transactionprovisions of the Act so that theProperty may be sold to Dr. Rothman,provided that he is the highest bidder;and so that the proceeds from the Salemaybe divided equally between LidyaAbramovici and Dr. Rothman'sindividual accounts in the Plans asrequired by the QDRO. The bidding willbe conducted either in the office of Dr.Rothman's attorney or in the office ofLidya Abramovici's attorney. Theapplicant represents that on the date ofthe Sale a determination of the fairmarket value of the Property will bemade by a qualified, independentappraiser; and the Plans will onlyaccept a bidding offer as considerationfor the Sale that is not less than the fairmarket value. Dr. Rothman intends tobegin the bidding process with a bid inexcess of $600,000. In addition, theapplicant represents that the Plans willreceive cash in consideration for theSale and the Plans will not incur anycosts or expenses from the Sale.

Furthermore, the applicant representsthat not only will the QDRO becomplied with by the Sale; but, theindividual accounts of Dr. Rothman inthe Plans will be able to diversify theirinvestments, creating a greater liquiditywith income-producing assets.

5. In summary, the applicantrepresents that the proposed transactionwill satisfy the statutory criteria for anexemption under section 408(a) of theAct because: (a) The proposed Sale willbe a one-time transaction for cash; (b)the Plans will not pay any real estatecommissions or fees and will not incurany other costs or expenses from thetransaction; (c) the Plans will notreceive any amount that is less than thefair market value of the Property asdetermined by a qualified, independentappraiser on the date of the Sale; and (d)Dr. Rothman, who is the onlyparticipant of the Plans that will beaffected by the proposed transaction,desires that the transaction beconsummated.

Notice to Interested Persons: Since Dr.Rothman is the only participant affectedby the proposed transaction, there is noneed to distribute notice to interestedpersons. Comments and requests for ahearing must be received by theDepartment within 30 days afterpublication of this notice in the FederalRegister.FOR FURTHER INFORMATION CONTACT: Mr.C.E. Beaver of the Department,telephone (202) 219-8881. (This is nota toll-free number.)

General Information

The attention of interested persons isdirected to the following:

(1) The fact that a transaction is thesubject of an exemption under section408(a) of the Act and/or section4975(c)(2) of the Code does not relievea fiduciary or other party in interest ofdisqualified person from certain otherprovisions of the Act and/or the Code,including any prohibited transactionprovisions to which the exemption doesnot apply and the general fiduciaryresponsibility provisions of section 404of the Act, which among other thingsrequire a fiduciary to discharge hisduties respecting the plan solely in theinterest of the participants andbeneficiaries of the plan and in aprudent fashion in accordance withsection 404(a)(1)(b) of the act; nor doesit affect the requirement of section401(a) of the Code that the plan mustoperate for the exclusive benefit of the.employees of the employer maintainingthe plan and their beneficiaries;

(2) Before an exemption may begranted under section 408(a) of the Actand/or section 4975(c)(2) of the Code,the Department must find that theexemption is administratively feasible,in the interests of the plan and of itsparticipants and beneficiaries andprotective of the rights of participantsand beneficiaries of the plan;s (3) The proposed exemptions, ifgranted, will be supplemental to, andnot in derogation of, any otherprovisions of the Act and/or the Code,including statutory or administrativeexemptions and transitional rules.Furthermore, the fact that a transactionis subject to an administrative orstatutory exemption is not dispositive ofwhether the transaction is in fact aprohibited transaction; and

(4) The proposed exemptions, ifgranted, will be subject to the expresscondition that the material facts andrepresentations contained in eachapplication are true and complete andaccurately describe all material terms ofthe transaction which is the subject ofthe exemption. In the case of continuingexemption' transactions, if any of thematerial facts or representationsdescribed in the application changeafter the exemption is granted, theexemption will cease to apply as of thedate of such change. In the event of anysuch change, application for a newexemption may be made to theDepartment.

Signed at Washington. DC, this 7th day ofDecember, 1993.Ivan Strasfeld,Director of Exemption Determinations,Pension and Welfare Benefits Administration.[FR Doc. 93-30253 Filed 12-9-93; 8:45 am]BILUNG COOE 4510-29-P

NATIONAL SCIENCE FOUNDATION

Office of Polar Programs; PermitIssued Under the AntarcticConservation Act of 1978

AGENCY: National Science Foundation.ACTION: Notice of permits issued underthe Antarctic Conservation Act of 1978,Public Law 95-541.

SUMMARY: The National ScienceFoundation (NSF) is required to publishnotice of permits issued under theAntarctic Conservation Act of 1978.This is the required notice.FOR FURTHER INFORMATION CONTACT:Thomas F. Forhan, Permit Office, Officeof Polar Programs, National ScienceFoundation, Washington, DC 20550.SUPPLEMENTARY INFORMATION: OnNovember 5, 1993 the National ScienceFoundation published a notice in theFederal Register of permit applicationsreceived. Permit for taking, was issuedto Antarctic Support Associates onDecember 3, 1993.

Thomas F. ForhanPermit Officer.[FR Doc. 93-30160 Filed 12-9-93; 8:45 am]BILUNG CODE 7855-01-M

Antarctic Conservation Act of 1978;

Permit Modification

AGENCY: National Science Foundation.SUMMARY: The Foundation modified apermit to conduct activities regulatedunder the Antarctic Conservation Act of1978 (Pub. L. 95-541; Code of FederalRegulations title 45, part 670).FOR FURTHER INFORMATION CONTACT:Guy G. Guthridge, 202-357-7817.Permit Office, Office of Polar Programs,National Science Foundation, Arlington,Virginia 22230.

Applicant: Gerald L. Kooyman,Scripps Institution of Oceanography.University of California, San Diego.

Description of Permit andModification: The Foundation issued apermit to Dr. Kooyrnan, an ornithologist,on 20 November 1993 after posting anotice in the 19 October 1993 FederalRegister. Public comments were notreceived. The permit allows handcapture and rlease of emperor penguinsat three antarctic locations to glue depth

64986


and velocity recorders and transmittersto the back feathers between the wings.The devices are removed during asecond capture. The permit also allowsapproach to emperor penguins in theSite of Special Scientific Interest at CapeCrozier to count chicks and adults. Thestudy, United States Antarctic Programproject S-026, enables comparison offoraging effort and breeding success andis a basis for observing emperorpenguins as environmental monitors inthe Ross Sea area.

The modification, issued on 2December 1993, allows capture andrelease of emperor penguins at CapeCrozier for the same study as at theother three sites. The number of birds tobe captured and released remains 40,same as in the original permit. CapeCrozier is designated a Site of SpecialScientific Interest for such studies asthis. The site's management plan will befollowed. Adding the fourth site willincrease the validity of the study.

Location: Cape Crozier, Antarctica.Dates: 11/20/93-12/31/94.

Guy G. Guthridge,Permit Office, Office of Polar Programs.(FR Doc. 93-30161 Filed 12-9-93; 8:45 am]BILUNG CD 755-01-M

Permit Issued Under the Antarctic

Conservation Act of 1978

AGENCY: National Science Foundation.

ACTION: Notice of permits issued underthe Antarctic Conservation Act of 1978,Public Law 95-541.

SUMMARY: The National ScienceFoundation (NSF) is required to publishnotice of permits issued under theAntarctic Conservation Act of 1978.This is the required notice.

FOR FURTHER INFORMATION CONTACT:Thomas F. Forhan, Permit Office, Officeof Polar Programs, National ScienceFoundation, Washington, DC 20550.

SUPPLEMENTARY INFORMATION: OnNovember 5, 1993 the National ScienceFoundation published a notice in-theFederal Register of permit applicationsreceived. Permit to enter speciallyprotected area and enter site of specialscientific interest, was issued to the Dr.Colin M. Harris on December 6, 1993.Thomas F. Forhan,Permit Officer, Office of Polar Programs.FR Doc. 93-30175 Filed 12-9-93; 8:45 am]

WWLKG CO0E 755-01-0

NUCLEAR REGULATORYCOMMISSION

Documents Containing Reporting orRecordkeeping Requirements: Officeof Management and Budget (OMB)Review

AGENCY: Nuclear RegulatoryCommission (NRC).ACTION: Notice of the OMB review ofinformation collection.

SUMMARY: The Nuclear RegulatoryCommission (NRC) has recentlysubmitted to OMB for review thefollowing proposal for collection ofinformation under the provisions of thePaperwork Reduction Act (44 U.S.C.chapter 35).

1. Type of submission, new, revisionor extension: New.

2. The title of the informationcollection: Applicant Self-Assessment.

3. The form number, if applicable:NRC Form 563.

4. How often the collection isrequired: The Applicant Self-Assessment will be requested frombasically qualified external applicantsapplying for engineering and scientificpositions at the time their initialapplication is received in the NRC'sOffice of Personnel.

5. Who will be required or asked toreport: Basically qualified externalapplicants applying for engineering andscientific positions with the NRC.

6. An estimate of the number ofannual responses: 1,500.

7. An estimate of the total number ofannual hours needed to complete therequirement or request: 125 (fiveminutes per response).

8. Section 3504(h), Public Law 96-511: Not applicable.

9. Abstract: The Applicant Self-Assessment will be used to collectuniform information from externalapplicants as to which technicalspecialties they possess that are uniqueto the needs of the NRC. Thisinformation will be reviewed by Officeof Personnel staff and used to matchapplicants' technical specialties withthose required by selecting officialswhen an engineering or scientificposition vacancy is to be filled.

Copies of the submittal may beinspected or obtained for a fee from theNRC Public Document Room, 2120 LStreet NW. (Lower Level), Washington,DC 20555.

Comments and questions should bedirected by mail to the OMB reviewer:Tim Hunt, Office of Information andRegulatory Affairs (3150- ), NEOB-3019, Office of Management and Budget,Washington, DC 20503.

Comments can also be submitted bytelephone at (202) 395-3084.

NRC Clearance Officer is Brenda JoShelton, (301) 492-8132.

Dated at Bethesda, Maryland, this 1st dayof December, 1993.

For the Nuclear Regulatory Commission.Gerald F. Cranford,Designated Senior Officialfor InformationResources Management.[FR Doc. 93-30157 Filed 12-9-93; 8:45 am]BILUNG CODE 7590-01-M

[Docket No. 50-302]

Florida Power Corp. Crystal River Unit3; Environmental Assessment andFinding of No Significant Impact

The U.S. Nuclear RegulatoryCommission (the Commission) isconsidering issuance of an amendmentto Facility Operating License No. DPR-72, issued to Florida Power Corporation(FPC, the licensee), for operation ofCrystal River, Unit 3, (CR-3) located inCitrus County, Florida.

Environmental AssessmentIdentification of the Proposed Action

The proposed amendment willreplace the existing TechnicalSpecifications (TS) in their entirety withthe Improved Technical Specifications(ITS). The proposed action is inaccordance with the licensee'samendment request dated August 25,1989.

The Need for the Proposed ActionIt has been recognized that nuclear

safety in all plants would benefit fromimprovement and standardization of TS.The "NRC Interim Policy Statement onTechnical Specification Improvementsfor Nuclear Power Reactors," (FederalRegister 52 FR 3788, February 6, 1987)and later the Final Policy Statement,formalized this need. To facilitate thedevelopment of individual ITS, eachreactor vendor owners group (OG) andthe NRC staff developed standardTechnical Specifications. For Babcock &Wilcox (B&W) plants, the standard TS(STS) is NUREG-1430, which formedthe basis of the CR-3 ITS. The NRCCommittee to Review GenericRequirements (CRGR) reviewed the STSand made note of the safety merits of theSTS and indicated its support ofconversion by operating plants to theSTS.

Description of the Proposed ChangeThe proposed revision to the TS is

based on NUREG-1430 and on guidanceprovided in the Policy Statement. Itsobjective is to completely rewrite,

64987

Federal Register / Vol. 58, No. 236 / Friday. December 10, 1993 / Notices

reformat, and streamline the existingTS. Emphasis is placed on humanfactors principles to improve clarity andunderstanding. The Bases section hasbeen significantly expanded to clarifyand better explain the purpose andfoundation of each specification. Inaddition to NUREG-1430, portions ofthe existing TS were also used as thebasis for the ITS. Plant-specific issues(unique design features, requirements,and operating practices) were discussedat length with the licensee, and genericmatters with the licensee and the B&Wand other OGs.

The proposed changes from theexisting TS can be grouped into fourgeneral categories, as follows:

Non-Technical tadministrative)changes were intended to make the ITSeasier to use for plant operationspersonnel. They are purely editorial innature or involve the movement orreformat of requirements withoutaffecting technical content. Everysection of the CR-3 TS has undergonethese types of changes. In order toensure consistency, the NRC staff andFPC have used NRC-1430 as guidanceto reformat and make otheradministrative changes.

Relocation of requirements includesitems that were in the existing CR-3 TS,but did not meet the criteria set forth inthe Policy Statement for inclusion inTS. In general, the proposed relocationof items in the CR-3 TS to the FinalSafety Analysis Report (FSAR),appropriate plant-specific programs,procedures, and ITS Bases follows theguidance of the B&W STS, NUREG-1430. Once these items have beenrelocated by removing them from the TSto other licensee-controlled documents,the licensee may revise them under theprovisions of 10 CFR 50.59 or other NRCstaff-approved control mechanismswhich provide appropriate proceduralmeans to control changes.

More restrictive requirements arethose proposed CR-3 ITS items that areeither more conservative thancorresponding requirements in theexisting CR-3 TS, or are additionalrestrictions which are not in the existingCR-3 TS, but are contained in NUREG-1430. Examples of more restrictiverequirements include: placing aLimiting Condition of Operation (LCO)on plant equipment which is notrequired by the present TS to beoperable; more restrictive requirementsto restore inoperable equipment; andmore restrictive surveillancerequirements.

Less restrictive requirements arerelaxations of correspondingrequirements in the existing CR-3 TSwhich provided little or no safety

benefit or placed unnecessary burden onthe licensee. These relaxations were theresult of generic NRC action or otheranalyses. They have been justified on acase-by-case basis for CR-3 as describedin the Safety Evaluation to be issuedwith the license amendment, which willbe noticed in the Federal Register.Examples of such requirements are:Modification of the Axial PowerImbalance TS to be consistent withNUREG--1430 and the current staffposition; and modification of actionrequirements on quadrant power tilt toachieve consistency between the FSARand the TS.Environmental Impacts of the ProposedAction

The Commission has completed itsevaluation of the proposed revision tothe TS. Changes which areadministrative in nature have beenfound to have no effect on technicalcontent of the TS, and are acceptable.The increased clarity and understandingthese changes bring to the TS areexpected to improve the operator'scontrol of the plant in normal andaccident conditions.

Relocation of requirements to otherlicensee-controlled documents does notchange the requirements themselves.Future changes to these requirementsmay be made by the licensee under 10CFR 50.59 or other NRC-approvedcontrol mechanisms, which assurecontinued maintenance of adequaterequirements. All such relocations havebeen found to be in conformance withthe guidelines of NUREG-1430 and thePolicy Statement, and, therefore, to beacceptable.

Changes involving more restrictiverequirements have been found to beacceptable.

Changes involving less restrictiverequirements have been reviewedindividually. When requirements havebeen shown to provide little or no safetybenefit or to place unnecessary burdenon the licensee, their removal from theTS was justified. In most cases,relaxations previously granted toindividual plants on a plant-specificbasis were the result of a generic NRCaction, or of agreements reached duringdiscussions with the OG and found tobe acceptable for CR-3. Genericrelaxations contained in NUREG-1430have also been reviewed by the NRCstaff and have been found to beacceptable.

In summary, the proposed revision tothe TS was found to provide control ofplant operations such that reasonableassurance will be provided that thehealth and safety of the public will beadequately protected.

These TS changes will not increasethe probability or consequences ofaccidents, no changes are being made inthe types of any effluent that may bereleased offsite, and there is nosignificant increase in the allowableindividual or cumulative occupationalradiation exposure. Therefore, theCommission concludes that there are nosignificant radiological environmentalimpacts associated with the proposedTS amendment.

With regard to potential non-radiological impacts, the proposedamendment involves features locatedentirely within the restricted areas asdefined in 10 CFR part 20. It does notaffect non-radiological plant effluentand has no other environmental impact.Therefore, the Commission concludesthat there are no significant non-radiological environmental impactsassociated with the proposedamendment.

Alternatives to the Proposed Action

Since the Commission has concludedthere is no measurable environmentalimpact associated with the proposedamendment, any alternatives with equalor greater environmental impact neednot be evaluated. The principalalternative to the amendment would beto deny the amendment request. Suchaction would not enhance the protectionof the environment.

Alternative Use of Resources

This action does not involve the useof resources not considered previouslyin the Final Environmental Statementfor Crystal River, Unit 3.

Agencies and Persons Consulted

The NRC staff consulted with theState of Florida regarding theenvironmental impact of the proposedaction.

Finding of No Significant ImpactBased upon the environmental

assessment, the Commission concludesthat the proposed action will not havea significant effect on the quality of thehuman environment. Accordingly, theCommission has determined not toprepare an environmental impactstatement for the proposed amendment.

For further details with respect to thisproposed action, see the licensee's letterdated August 25, 1989. This letter isavailable for public inspection at theCommission's Public Document Room,The Gelman Building, 2120 L Street,NW., Washington, DC 20555, and at thelocal public document room located atthe Coastal Region Library. 8619 W.Crystal Street, Crystal River. Florida32629.

64988

Federal Regisier I Vol. 58, No. 236 / Friday, December 10, 1993 / Notices

Dated at Rockville, Maryland this 3rd dayof December 1993.

For the Nuclear Regulatory Commission.Bart C. Buckley,Acting Director, Project Directorate 11-2,Division of Reactor Projects--/lI, Office ofNuclear Reactor Regulation.IFR Doc. 93-30180 Filed 12-9-93; 8:45 am)BILUNG CODE 759"0-1

[Docket No. 50-3021

Florida Power Corp.; Issuance ofAmendment to Facility OperatingLicense

The U.S. Nuclear RegulatoryCommission (Commission) has issuedAmendment No. 148 to FacilityOperating License No. DPR-72 issued toFlorida Power Corporation (thelicensee), which revised the TechnicalSpecifications for operation of CrystalRiver, Unit No. 3, located in CitrusCounty, Florida. The amendment iseffective as of the date of issuance.

The amendment revises thecontainment integrity section 3/4.6.1 ofthe existing Technical Specifications. Itis comprised of that portion of theImproved Technical Specificationsrequested by an application datedAugust 25, 1989. Separate issuance ofthis portion was requested by thelicensee in a letter dated October 25,1993.

The application for amendmentcomplies with the standards andrequirements of the Atomic Energy Actof 1954, as amended (the Act), and theCommission's rules and regulations.The Commission has made appropriatefindings as required by the Act and theCommission's rules and regulations in10 CFR chapter I, which are set forth inthe license amendment.

Notice of Consideration of Issuance ofAmendment and Opportunity forHearing in connection with this actionwas published in the Federal Registeron November 8, 1989 (54 FR 46998). Norequest for hearing or petition for leaveto intervene was filed following thisnotice.

The Commission has prepared anEnvironmental Assessment related tothe action and has determined not toprepare an Environmental ImpactStatement. Based upon theEnvironmental Assessment, theCommission has concluded that theissuance of this amendment will nothave a significant effect on the qualityof the human environment (58 FR60468).

For further details with respect to theaction see (1) the application foramendment dated August 25, 1989, assupplemented October 25, 1993, (2)

Amendment No. 148 to License No.DPR-72, (3) the Commission's relatedSafety Evaluation, and (4) theCommission's EnvironmentalAssessment. All of these items areavailable for public inspection at theCommission's Public Document Room,the Gelman Building, 2120 L StreetNW., Washington, DC 20555, and at thelocal public document room located atthe Coastal Region Library, 8619 W.Crystal Street, Crystal River, Florida32629.

Dated at Rockville, Maryland, this 3rd dayof December 1993.

For the Nuclear Regulatory Commission.Harley Silver,Senior Project Manager, Project Directorate11-2, Division of Reactor Projects-/Il.IFR Doc. 93-30181 Filed 12-9-93; 8:45 am)BILUNG CODE 7590-01-U

SECURITIES AND EXCHANGECOMMISSION

(Release No. 34-33273; File No. SR-MBS-93-02]

Self-Regulatory Organizations; MBSClearing Corp.; Filing of ProposedRule Change Relating to MinimumCapital Requirements of BrokerApplicants for Membership

December 2, 1993.

Pursuant to section 19(b)(1) of theSecurities Exchange Act of 1934("Act"),I notice is hereby given that onMarch 3, 1993, the MBS ClearingCorporation ("MBS") filed with theSecurities and Exchange Commission("Commission") the proposed rultechange (File No. SR-MBS-93-02) asdescribed in Items I, II, and III below,which Items have been preparedprimarily by the self-regulatoryorganization. On August 12, 1993, MBSfiled Amendment No. I to the proposedrule change.2 The Commission ispublishing this notice to solicitcomments from interested persons.

I. Self-Regulatory Organization'sStatement of the Terms of the Substanceof the Proposed Rule Change

MBS proposes to amend Article III,Rule 1, Sec. 2 of its rules concerning theminimum capital requirements formembership of broker applicants.

1 15 U.S.C. 7as(b)(1) (1988).2 Letter from George T. Simon, Foley & Lardner.

to Jack Drogin, Branch Chief, Division of MarketRegulation, Commission (August 12, 1993).

II. Self-Regulatory Organization'sStatement of the Purpose of, andStatutory Basis for, the Proposed RuleChange

In its filing with the Commission, theself-regulatory organization includedstatements concerning the purpose ofand basis for the proposed rule changeand discussed any comments it receivedon the proposed rule change. The textof these statements may be examined atthe places specified in Item IV below.The self-regulatory organization hasprepared summaries, set forth insections (A), (B), and (C) below, of themost significant aspectes of suchstatements.

A. Self-Regulatory Organization'sStatement of the Purpose of, andStatutory Basis for, the Proposed RuleChange

The purpose of the proposed rulechange is to amend the minimumcapital requirements for membership ofbroker applicants to bring the minimumcapital requirements more in line withthe levels of risk posed by differenttypes of participants. Under theproposed rule change, in order for abroker applicant to become aparticipant, they will be required tohave net capital (as determined inaccordance with Securities ExchangeAct Rule 15c3-13 or in accordance withthe Government Securities Act of 1986 4)

of not less than $5,000,000.

The proposed rule change isconsistent with section 17A(b)(3) (A)and (F) of the Act5 in that it willpromote the safeguard of securities andfunds in the custody or control of MBS,or for which it is responsible.

B. Self-Regulatory Organization'sStatement on Burden on Competition

MBS does not believe that theproposed rule change will impose anyburden on competition not necessary orappropriate in furtherance of thepurposes of the Act.

C. Self-Regulatory Organization'sStatement on Comments on theProposed Rule Change Received FromMembers, Participants, or Others

MRS has not solicited writtencomments with respect to the proposedrule change, and none have beenreceived.

-117 CFR 240.15c3-1.4Pub. L 99-571, 100 Stat. 3208 (1986).315 U.S.C. 78q-l(b)(3) (A) and (F) (1988).

64989


III. Date of Effectiveness of theProposed Rule Change and Timing forCommission Action

Within 35 days of the date ofpublication of this notice in the FederalRegister or within such longer period (i)as the Commission may designate up to90 days of such date if it finds suchlonger period to be appropriate andpublishes its reason for so finding, or (ii)as to which the self-regulatoryorganization consents, the Commissionwill:

(A) By order approve such proposedrule change, or

(B) Institute proceedings to determinewhether the proposed rule changeshould be disapproved.

IV. Solicitation of CommentsInterested persons are invited to

submit written data, views, andarguments concerning the foregoing.Persons making written submissionsshould file six copies thereof with theSecretary, Securities and ExchangeCommission, 450 Fifth Street NW..Washington, DC 20549. Copies of thesubmission, all subsequentamendments, all written statementswith respect to the proposed rulechange that are filed with theCommission, and all writtencommunications relating to theproposed rule change between theCommission and any person, other thanthose that may be withheld from thepublic in accordance with theprovisions of 5 U.S.C. 552, will beavailable for inspection and copying inthe Commission's Public ReferenceSection, 450 Fifth Street NW.,Washington, DC 20549. Copies of suchfiling also will be available forinspection and copying at the principaloffice of MBS. All submissions shouldrefer to File Number SR-MBS-93-02and should be submitted by January 3,1994.

For the Commission, by the Division ofMarket Regulation. pursuant to delegatedauthority.Margaret H. McFarland.Deputy Secretary.[FR Doc. 93-30165 Filed 12-9-93; 8:45 am]BILUNG CODE 0to-1.-

[Release No. 34-33274; File Nos. 600-19and 600-22]

Self-Regulatory Organizations; MBSClearing Corp.; Filing of Applicationfor Extension of TemporaryRegistration as a Clearing Agency

December 2, 1993.Notice is hereby given that on

November 29, 1993, MBS Clearing

Corporation ("MBS") filed with theSecurities and Exchange Commission("Commission") pursuant to section19(a) of the Securities Exchange Act of1934 ("Act"), a request for extension ofits registration as a clearing agencyunder section 17A of the Act for aperiod of 12 months.2 The Commissionis publishing this notice to solicitcomments on the request for extensionof registration from interested persons.

On February 2, 1987, the Commissiongranted MBS's application forregistration as a clearing agency,pursuant to sections 17A(b) and 19(a)(1)of the Act 3 and Rule 17Ab2-1(c) 4

thereunder, on a temporary basis for aperiod of 18 months.3 Subsequently, theCommission issued orders that extendedMBS's temporary registration as aclearing agency, the last of whichextended MBS's registration throughDecember 31, 1993.6 MBS providesclearance and settlement services formembers in processing transactions inmortgage-backed securities.

Interested persons are invited tosubmit written data, views andarguments concerning the foregoing.Persons making written submissionsshould file six copies thereof with theSecretary, Securities and ExchangeCommission, 450 Fifth Street NW.,Washington, DC 20549. Copies of allwritten comments will be available forinspection and copying in theCommission's Public Reference Section,450 Fifth Street NW., Washington, DC20549. All submissions should refer tothe File Nos. 600-19 and 600-22 andshould be submitted by January 3, 1994.

For the Commission, by the Division ofMarket Regulation pursuant to delegatedauthority.7Margaret H. McFarland,Deputy Secretary.[FR Dec. 93-30166 Filed 12-9-93; 8:45 am)BLLING COE 01-1-4A

1 15 U.S.C. 78s(a).zLetter from J. Craig Long, Foley & Lardner, to AN

Burstein, Attorney, Division of Market Regulation,Commission, dated November 29,1993.

3 is U.S.C. 76q-l(b) and 15 U.S.C. 78s(a)(1).417 CFR 240.17Abz-1(c).

3 Securities Exchange Act Release'No. 24046(February 2,1987), 52 FR 4218 (Order granting MBSregistration as a clearing agency for a period not toexceed 18 months).

a Securities Exchange Act Release Nos. 25957(August 2, 1988), 53 FR 29537; 27079 (July 31.1989), 54 FR 32412; 28492 (September 28. 1990). 55FR 41148; 29751 (September 27,1991) 56 FR50602; and 31750 (January 21. 1993). 58 FR 6424.717 CFR 200.30-3(aX50).

[Release No. 34-33290; File No. SR-NASD-93-67]

Self-Regulatory Organizations; Filingand Order Granting AcceleratedApproval of Proposed Rule Change bythe National Association of SecuritiesDealers, Inc., Relating to an InterimExtension of the OTC Bulletin Board®Service Through February 1, 1994

December 3, 1993.Pursuant to section 19(b)(1) of the

Securities Exchange Act of 1934("Act"), 15 U.S.C. 78s(b)(1), notice ishereby given that on November 15,1993, the National Association ofSecurities Dealers, Inc. ("NASD" or"Association") filed with the Securitiesand Exchange Commission("Commission" or "SEC") the proposedrule change as described in Items I andII below, which Items have beenprepared by the NASD. TheCommission is publishing this notice tosolicit comments on the proposed rulechange from interested persons and issimultaneously approving the proposal.

I. Self-Regulatory Organization'sStatement of the Terms of Substance ofthe Proposed Rule Change

On June 1, 1990, the NationalAssociation of Securities Dealers, Inc.,("NASD") initiated operation of TheOTC Bulletin Board Service ("OTCBBService" or "Service") in accord withthe Securities and ExchangeCommission's ("Commission") approvalof File No. SR-NASD-88-19, asamended., The OTCBB Service providesa real-time quotations medium thatNASD member firms can elect to use toenter, update, and retrieve quotationinformation (including unpricedindications of interest) for securitiestraded over-the-counter that are neitherlisted on The Nasdaq Stock Market SMnor on a registered national securitiesexchange (collectively referred to as"unlisted securities"). Essentially, theService supports NASD members'market making in unlisted securitiesthrough authorized Nasdaq Workstationunits. Real-time access to quotationinformation captured in the Service isavailable to subscribers of Level 2/3Nasdaq service as well as subscribers ofvendor-sponsored services that nowcarry OTCBB Service data. The Serviceis currently operating under interimapproval.2

The NASD hereby files this proposedrule change, pursuant to section 19(b)(1)of the Act and Rule 19b-4 thereunder,

I Securities Exchange Act Release No. 27975 (May1. 1990), 55 FR 19124 (May 8. 1990).

2 Securities Exchange Act Release No. 32384 (May28,1993) 58 FR 31773 Oune 4,1993).

64990


to-obtain authorization for an interimextension of the Service throughFebruary 1, 1994. During this interval,there will be no material change in theOTCBB Service's operational features,absent Commission approval of acorresponding Rule 19b-4 filing.3

II. Self-Regulatory Organization'sStatement of the Purpose of, andStatutory Basis for, the Proposed RuleChange

In its filing with the Commission, theNASD included statements concerningthe purpose of and basis for theproposed rule change and discussed anycomments it received on the proposedrule change. The text of these statementsmay be examined at the places specifiedin Item IV below. The NASD hasprepared summaries, set forth insections (A), (B), and (C) below, of themost significant aspects of suchstatements.

A. Self-Regulatory Organization'sStatement of the Purose of, andStatutory Basis for, the Proposed RuleChange

1. PurposeThe purpose of this filing is to ensure

continuity in the operation of theOTCBB Service while the Commissionconsiders an earlier NASD rule filing(File No. SR-NASD--92-7) thatrequested permanent approval of theService. For the month ending October31, 1993, the Service reflected themarket making positions of 360 NASDmember firms displaying quotationslindications of interest in approximately4,183 unlisted securities.

During the proposed extension,foreign securities and AmericanDepositary Receipts (collectively,"foreign/ADR issues") will remainsubject to the twice-daily, updatelimitation that traces back to theCommission's original approval of theOTCBB Service's operation. As a result,all priced bids/offers displayed in theService for foreignADR issues willremain indicative.

In conjunction with the launch of theService in 1990, the NASD implementeda filing requirement (under section 4 ofSchedule H to the NASD By-Laws) andreview procedures to verify memberfirms' compliance with Rule 15c2-11under the Act. During the proposed

3On July 16. 1993. the Commission issuedSecurities Exchange Act Release No. 32647approving an NASD rule change to establish real-time trade reporting requirements for members'transactions In OTCBB Service-eligible securities.These new requirements will take effect onDecember 20. 1993 and will support the price andvolume reporting requirements under Section 2 ofSchedule H to the NASD By-Laws.

extension, this review process willcontinue to be an important componentof the NASD's self-regulatory oversightof broker-dealers' market making inunlisted securities. The NASD alsoexpects to work closely with theCommission staff in developing furtherenhancements to the Service to fulfillthe market structure requirementsmandated by the Securities EnforcementRemedies and Penny Stock Reform Actof 1990 ("Reform Act"), particularlysection 17B of the Act.4 The NASDnotes that implementation of the ReformAct entails Commission rulemaking inseveral areas, including thedevelopment of mechanisms forgathering and disseminating reliablequotation/transaction information for"penny stocks."

2. Statutory BasisThe NASD believes that the proposed

rule change is consistent with sectionsl1A(a)(1), 15A(b) (6) and (11), andsection 17B of the Act. Section 11A(a)(1)sets forth the Congressional findingsand policy goals respecting operationalenhancements to the securities markets.Basically, the Congress found that newdata processing and communicationstechniques should be applied toimprove the efficiency of marketoperations, broaden the distribution ofmarket information, and fostercompetition among market participants.Section 15A(b)(6) requires, inter alia.that the NASD's rules promote just andequitable principles of trade, facilitatesecurities transactions, and protectpublic investors, subsection (11)thereunder authorizes the NASD toadopt rules governing the form andcontent of quotations for securitiestraded over-the-counter for the purposesof producing fair and informativequotations, preventing misleadingquotations, and promoting orderlyprocedures for collecting anddisseminating quotations. Finally,section 17B contains Congressionalfindings and directives respecting thecollection and distribution of quotationinformation on low-priced equitysecurities that are neither Nasdaq norexchange-listed.

The NASD believes that extension ofthe Service through February 1, 1994 isfully consistent with the foregoingprovisions of the Act.

40n November 24.1992, the NASD filed anapplication with the Commission for interimdesignation of the Service as an automatedquotation system to section 17B() of the Act. OnDecember 30, 1992, the Commission granted"Qualifying Electronic Quotation System" status forthe Service for purposes of certain penny stockrules that became effective on January 1, 1993. TheOTCBB will retain its QEQS status for the term ofthe proposed extension.


The NASD believes that the rulechange will not result in any burden oncompetition that is not necessary orappropriate in furtherance of thepurposes of the Act.


Written comments were neithersolicited nor received.

IlL. Date of Effectiveness of theProposed Rule Change and Timing forCommission Action

The NASD requests that theCommission find good cause, pursuantto section 19(b)(2) of the Act, forapproving the proposed rule changeprior to the 30th day after itspublication in the Federal Register toavoid any interruption of the Service.Otherwise, the NASD will be required tosuspend operation of the Servicepending Commission action on theproposed extension.

The NASD believes that acceleratedapproval is appropriate to ensurecontinuity in the Service's operationpending a determination on permanentstatus for the Service, as requested inFile No. SR-NASD-92-7. Continuedoperation of the Service will ensure theavailability of an electronic quotationmedium to support member firms'market making in approximately 4,183unlisted equity securities and thewidespread dissemination of quotationinformation on these securities. TheService's operation also expedites pricediscovery and facilitates the executionof customer orders at the best availableprice. From a regulatory standpoint, theNASD's capture of quotation data fromparticipating market makerssupplements the price and volume datareported by member firms pursuant tosection 2 of Schedule H to the NASDBy-Laws.

The Commission finds that approvalof the proposed rule change isconsistent with the Act and the rulesand regulations thereunder, and, inparticular, with the requirements ofsection 15A~b)(11) of the Act, whichprovides that the rules of the NASDrelating to quotations must be designedto produce fair and informativequotations, prevent fictitious ormisleading quotations, and promoteorderly procedures for collecting.distributing, and publishing quotations.

The Commission finds good cause forapproving the proposed rule changeprior to the 30th day after the date of

64991


publishing notice of the filing thereof.Accelerated approval of the NASD'sproposal is appropriate to ensurecontinuity in the Service's operation asan electronic quotation medium thatsupports NASD members' marketmaking in these securities and thatfacilitates price discovery and theexecution of customers orders at bestavailable price. Additionally, continuedoperation of the Service will materiallyassist the NASD's surveillance oftrading in unlisted securities that areeligible and quoted in the Service.


submit written data, views, andarguments concerning the foregoing.Persons making written submissionsshould file six copies thereof with theSecretary, Securities and ExchangeCommission, 450 Fifth Street NW.,Washington, DC 20549. Copies of thesubmission, all subsequentamendments, all written statementswith respect to the proposed rulechange that are filed with theCommission, and all writtencommunications relating to theproposed rule change between theCommission and any person, other thanthose that may be withheld from thepublic in accordance with theprovisions of 5 U.S.C. 552, will beavailable for inspection and copying inthe Commission's Public ReferenceRoom. Copies of such filing will also beavailable for inspection and copying atthe principal office of the NASD. Allsubmissions should refer to the filenumber in the caption above and shouldbe submitted by January 3, 1994.

It is therefore ordered, Pursuant tosection 19(b)(2) of the Act, that theproposed rule change be, and hereby is,approved for an interim period throughFebruary 1, 1994.

For the Commission, by the Division ofMarket Regulation, pursuant to delegatedauthority, 17 CFR 200.30-3(a)(12).Margaret H. McFarland,Deputy Secretary.[FR Dec. 93-30266 Filed 12-9-93; 8:45 am]BILLING CODE 0010-01-M

Self-Regulatory Organizations;Applications for Unlisted TradingPrivileges; Notice and Opportunity forHearing; Philadelphia Stock Exchange,Incorporated

December 3, 1993.The above named nalional securities

exchange has filed applications with theSecurities and Exchange Commission("Commission") pursuant to section12(f)(1)(B) of the Securities Exchange

Act of 1934 and Rule 12f-1 thereunderfor unlisted trading privileges in thefollowing securities:

Putnam Investment Grade Municipal Trust IllShares of Beneficial Interest (File No. 7-

11643)Van Kampen Merritt Select Sector Municipal

TrustCommon Shares of Beneficial Interest, S.01

Par Value (File No. 7-11644)Chateau Properties, Inc.

Common Stock, $.01 Par Value (File No. 7-11645)

Associated Realty Estates CorporationCommon Stock, No Par Value (File No. 7-1 11646)

Newfield Exploration CompanyCommon Stock, $.001 Par Value (File No.

7-11647)Morgan Stanley High Yield Fund, Inc.

Common Stock, 5.01 Par Value (File No. 7-11648)

Everest and Jennings International Ltd.Common Stock, $.01 Par Value (File No. 7-

11649)Property Trust of America

Cum. Cv. Series A Pfd. Shares of BeneficialInterest, $1.00 Par Value (File No. 7-11650)

Korea Equity Fund, Inc.Common Stock, $.01 Par Value (File No. 7-

11651)Magma Copper Company

Cum. Conv Pfd. Stock Series E, 5.01 ParValue (File No. 7-11652)

These securities are listed andregistered on one or more other nationalsecurities exchange and are reported inthe consolidated transaction reportingsystem.

Interested persons are invited tosubmit on or before December 27, 1993,written data, views and argumentsconcerning the above-referencedapplication. Persons desiring to makewritten comments should file threecopies thereof with the Secretary of theSecurities and Exchange Commission,450 5th Street NW., Washington, DC20549. Following this opportunity forhearing, the Commission will approvethe application if it finds, based uponall the information available to it, thatthe extensions of unlisted tradingprivileges pursuant to such applicationsare consistent with the maintenance offair and orderly markets and theprotection of investors.

For the Commission, by the Division ofMarket Regulation, pursuant to delegatedauthority.Jonathan G. Katz,Secretary.[FR Doc. 93-30171 Filed 12-9-93; 8:45 am)BILUNG CODE 8010-01-

(Release No. 34-33275; File No. SR-MSRB-93-061

Self-Regulatory Organizations;Municipal Securities RulemakingBoard; Order Approving ProposedRule Change Relating to AutomatedComparison of Inter-DealerTransactions

December 2, 1993.On April 13, 1993, the Municipal

Securities Rulemaking Board ("MSRB")filed with the Securities and ExchangeCommission ("Commission") aproposed rule change (File No. SR-MSRB-93-06) pursuant to section19(b)(1) of the Securities Exchange Actof 1934 ("Act")., The proposed rulechange requires the use of an automatedcomparison system for all eligible inter-dealer transactions. The Commissionpublished notice of the proposed rulechange in the Federal Register on May11, 1993.2 No comments were receivedas a result of the Federal Registernotice.3 For the reasons discussedbelow, the Commission is approving theproposed rule change, with an effectivedate of February 1, 1994.4

I. DescriptionThe proposed rule change amends

MSRB Rule G-12(f)i), relating toautomated comparison of inter-dealertransactions.5 The proposed rule changeeliminates the exemption in Rule G-12(f)(i) which previously allowed atransaction to be compared outside ofthe comparison system if at least oneparty to the transaction is neither adirect nor indirect member in aregistered securities clearing agencyoffering automated comparison systems.All inter-dealer transactions eligible forautomated comparison (i.e., havingCUSIP numbers), will now be requiredto be submitted for comparison andcompared in an automated comparison

,15 U.S.C. 78s(bl(l) (1988).2 Securities Exchange Act Release No. 32262 (May

4, 1993), 58 FR 27757.3 In August 1991, the MSRB published the

proposed rule change for comment as well as otherdraft amendments to Rules G-12( and G-5(d).Sixteen comment letters were received. Twelvecommenters generally supported the August 1991draft amendments, two were opposed, and twocommenters addressed a possible modificationwithout specifically supporting or opposing thedral amendments. There were no commentsspecifically opposing this proposed rule change.

4 See letter from Judith A. Somerville. MSRB, toJudith C. Poppalardo, Assistant Director, Division ofMarket Regulation, Commission (November 29,1993).

5Trade comparison, or the matching of the twosides of the transaction, is the process after a tradehas been executed by which broker-dealers confirmwith each other the trade's terms and the existenceof a contract. Comparison is the first of the threemajor steps in processing a securities transaction(the other two being clearance and settlement).

64992


system, without regard to whether eitherparty, or their agents, are participants insuch a system. A dealer engaging ininter-dealer transactions, therefore, willbe required to access an automatedcomparison system, either throughdirect membership in a registeredclearing agency or through the use of anagent that will compare inter-dealertransactions for the dealer. Theproposed rule change will becomeeffective February 1, 1994.

II. Written Comments

As noted earlier, the MSRB publishedfor comment the proposed rule changeas well as other draft amendments toMSRB Rules G-12(f) and G-15(d) andreceived sixteen comment letters.6There were no comments specificallyopposing this particular proposed rulechange.

In addition, the MSRB's proposedimplementation timetable for the draft.eSee letter from Philip Lanz. Managing Director.

Bear, Steams Securities Corp., to Harold L. Johnson.Deputy General Counsel, MSRB (December 16,1991); letter from Jan Fenty, President. TheCashier's Association of Wall Street. Inc.. to HaroldL. Johnson, Deputy General Counsel. MSRB(December 3.1991): letter from William 1. Winter.Vice PresidenL Cashies Department. A.G. Edwardsand Sons, Inc.. to Harold L Johnson. DeputyGeneral Counsel. MSRB (December 13. 1991); letterfrom Kathleen Graffam. First Chicago CapitalMarkets. Inc.. to Harold L Johnson. Deputy GeneralCounsel. MSRB (December 13,1991); letter fromSteve Harris, Executive Vice President, GoldenHarris Capital Group. Inc, to Harold L Johnson,Deputy General Counsel MSRB (October 7. 1991];letter from John J. Lynch, Jr., Executive VicePresident, J.F. Hartfleld end Co.. Inc., to Harold L.Johnsom Deputy General Counsel. MSRB(December S. 1991);. letter from John F. Lee.President, New York Clearing House. to Harold LJohnson, Deputy General'Counsel, MSRB(December 18. 1991); letter from Harold Durk, DukeMcElroy & Company. to Harold L Johnson, DeputyGeneral Counsel, MSRB (December 3, 1991); letterfrom Lawrence Morillo. Senior Vice President.Pershing. to Harold L Johnson, Deputy GeneralCounsel, MSRB (December 6, 1991); letter fromJames IL Pyle, Managing Partner, Terry L.McCullough. Partner. Richard E. Whalen. Partner,and Benita L Simon. Partnra. Elmer E. Powell andCompany, to Harold L Johnson. Deputy GeneralCounsel, MSRB (November 27. 1991); letter fromGeorge Brakatselos, Vice President, PublicSecurities Association, to Harold L Johnson,Deputy General Counsel MSRB (November 19,1991); letter from Thomas Sargant. Vice President,The Regional Municipal Operations Association. toHarold L Johnson, Deputy General Counsel, MSRB(December 12,1991); letter from George J. Minnig,Chairman. Regulatory and Clearance Committee.Securities Industry Association, to Harold LJohnson, Deputy General Counsel, MSRB(December 6, 1991); letter from Jerome Clair,Managing Director, and Robert Mattel. AssistantManager, Smith Barney, Harris Upham & Co., Inc.,to Harold L Johnson, Deputy General Counsel.MSRB (December 9, 1991); letter from RogerSpringate. Jr.. Springate and Company, to Harold L.Johnson, Deputy General Counsel, MSRB(December 13. 1991); and letter from Rick Farrell,Assistant Vice President. United Missouri Bank.N.A., to Harold L Johnson, Deputy GeneralCounsel, MSRB (November 5, 1991).

amendments was published forcomment in April 1992. Two commentletters were received.' The commentersgenerally supported the implementationplan as it related to the proposed rulechange. One commenter noted,however, that the implementation dateof the proposed rule change shouldcoincide with the effective date of anamendment on book-entry settlement ofdealer-to-dealer transactions.e TheMSRB, however, decided to implementthe rule change on book-entry deliveryfirst, to allow additional time for somedealers to make changes in theirclearing arrangements to accomplishautomated 'comparison.

In addition, the automatedcomparison system operated by theNational Securities Clearing Corporation("NSCC") was being redesigned.9 TheMSRB believed that additional time wasnecessary to resolve implementationissues arising from that system prior torequiring additional users to participatein a comparison system. Since that time,however, the MSRB has concluded thatimplementation of NSCC's automatedcomparison system has proceededsuccessfully.

III. Discussion

The Commission believes that theMSRB's proposed rule change isconsistent with sections 15B and 17A ofthe Act.1o Section 15B, among otherthings, requires that the MSRB's rules bedesigned to foster cooperation andcoordination with persons engaged inclearing, settling, and processinginformation with respect to, andfacilitating transactions in, municipalsecurities, to remove impediments toand perfect the mechanism of a free andopen market in municipal securities,and, in general, to protect investors andthe public interest.- Section 17Amandates the creation of a nationalsystem for automated clearance andsettlement of securities transactions.While municipal securities are definedgenerally as exempted securities underthe Act,12 municipal securities are

7 See letter from Margaret Sullivan, Assistant VicePresident, The First National Bank of Chicago, toHarold L. Johnson, Deputy General Counsel, MSRB(May 26. 1992) and letter from Mario P. DeAngelo.Vice President. Alex. Brown & Sons, to Harold LJohnson, Deputy General Counsel. MSRB (April 29,1992).

aSee supra, note 6. letter from Alex. Brown &Sons.

'For further details concerning NSCC'sredesigned bond comparison program, seeSecurities Exchange Act Release No. 32747 (August23, 1993), 58 FR 44530.

10 15 U.S.C. 78o-4 and 78q-1 (1988).1115 U.S.C. 78o-4(bX2)(C) (1988).12 15 U.S.C. 78c(a)(12)(A)(ii) (1988).

specifically included for purposes ofsection 17A of the Act.13

The comparison of municipalsecurities transactions is primarilyaccomplished through the use ofautomated comparison systems operatedby clearing corporations registered withthe Commission. The automatedsystems have provided substantialefficiencies and cost savings to themunicipal securities market byeliminating much of the timeconsuming and expensive manualprocessing associated with transactionsprocessed outside of the automatedsystems. The use of an automatedcomparison system also helps reduceprocessing problems associated withhigh levels of transaction volume andincreases the likelihood of timelysettlement. There continues, however.to be some transactions that are eligiblefor processing in the automated systems,but are compared with the use of mailedpaper confirmations to validate tradedata on executed trades prior tosettlement.

Currently, MSRB Rule G-12(f)(i)requires the use of a comparison systemfor most inter-dealer transactionseligible for settlement in those systems.When that rule was adopted in 1983, theMSRB considered whether thisrequirement should apply to all eligibleinter-dealer transactions. The MSRBreceived comment from the industrywhich suggested the need for additionaltime on the part of some dealers toadjust to the automated clearance andsettlement systems. Based on thosecomments, the MSRB decided toprovide an exemption within MSRBRule G-12[f)(i) which effectivelyallowed a transaction to be comparedoutside of the comparison system if atleast one party to the transaction wasneither a direct nor indirect member ina registered securities clearing agencyoffering comparison systems. TheMSRB, however, also stated its intentionthat, ultimately, the rules should applyto all inter-dealer transactions in orderfor the market to obtain the maximumbenefits and efficiencies possible fromautomated comparison systems.14

The proposed rule change, which willnow require the use of an automatedcomparison system for all eligible inter-dealer transactions, is part of the secondphase of the MSRB's overall plan tocomplete the transition of the municipalsecurities market to automatedtechniques of clearance and

13 15 U.S.C. 7Wca)(12){BXii) (1988).

14 Securities Exchange Act Release No. 20365(November 14, 1983). 48 FR 52531.

64993

Federal Register / Vol. 58, No. 236 I Friday, December 10, 1993 / Notices

settlement.15 The Commission,therefore, believes that the proposalfurthers the goals of section 17A of theAct by reducing reliance on inefficientmanual procedures for clearing trades inmunicipal securities. In addition, theCommission believes the proposed rulechange is consistent with section 15B ofthe Act because the proposed rulechange is designed to foster cooperationand coordination with persons engagedin clearing, settling, and processinginformation with respect to, andfacilitating transactions in, municipalsecurities, to remove impediments toand perfect the mechanism of a free andopen market in municipal securities,and, in general, to protect investors andthe public interest. The Commissionalso notes that the proposed rule changeis consistent with the recommendationsof the Bachmann Task Force, te and theGroup of Thirty concerning automatedclearance and settlement.17 Theproposal also is consistent with effortsby other self-regulatory organizations toaccelerate the comparison of tradesamong market participants.1e

The MSRB requested thatimplementation of the proposed rulechange be delayed until sixty days after

is For further details concerning the MSRB'soverall plan. see Securities Exchange Act ReleaseNo. 31645 (December 23, 1992), 57 FR 62407.

- The Bachmann Task Force was a panel offinancial industry leaders formed to studyimprovements necessary to the clearance andsettlement system. For further details concerningthe recommendations of the Bachmann Task Force,see Report of the Bachmann Task Force onClearance and Settlement Reform in U.S. SecuritiesMarkets (May 1992).

17 The Group of Thirty Is an Independent, non-partisan. non-profit organization established in1978 whose function is to study Internationaleconomic and financial issues. The Group ofThirty's recommendations are discussed in Groupof Thirty, Clearance and Settlement Systems in theWorld's Securities Markets (March 1989). One ofthese recommendations was that all comparison oftrades between direct markel participants (i.e.,brokers, broker/dealers and other exchangemembers) should be accomplished by T+1 Asdiscussed above, the Commission believesautomated systems facilitate earlier tradecomparison, which Is integral to shortening thesettlement cycle in the U.S. clearance andsettlement system. See Securities Act Release No.7022; Securities Exchange Act Release No. 33023;and Investment Company Act Release No. 19768(October 6, 1993), 58 FR 52891 (adopting new rule15c6-1 under the Act that establishes threebusiness days instead of five business days as thestandard settlement timeframe for broker-dealertransactions).

15See Securities Exchange Act Release No. 26627(March 14, 1989), 54 FR 11470 (order approving theNew York Stock Exchange's Overnight ComparisonSystem providing for next-day comparison ofsecurities transactions) and Securities Exchange ActRelease No. 27851 (March 27. 1990). 55 FR 12759(order approving the American Stock Exchange'sproposal requiring certain securities transactions tobe compared or otherwise closed out by the closeof business the day following the trade date("T+I"1).

Commission approval to providesufficient time to notify industrymembers of the rule change.19 TheCommission agrees with the MSRB thatsixty days is both a sufficient and anappropriate amount of time in which tonotify those members and therefore isdelaying implementation of theproposal until February 1, 1994.

IV. ConclusionOn the basis of the foregoing, the

Commission finds that the proposedrule change is consistent with the Act,and in particular with sections 15B and17A of the Act, and with the rules andregulations thereunder.

It is therefore ordered, Pursuant tosection 19(b)(2) of the Act,20 that theproposed rule change (File No. SR-MSRB-93-06) be, and hereby is,approved. Consistent with the MSRB'srequest, the proposal is approved withan effective date of February 1, 1994.

For the Commission, by the Division ofMarket Regulation, pursuant to delegatedauthorityz1Margaret H. McFarland,Deputy Secretary.IFR Doc. 93-30167 Filed 12-9-93; 8:45 am]BILUNG CODE 8010-01-M

(Release No. 34-33289; File No. SR-NASD-92-12, Amendment No. 4]

Self-Regulatory Organizations;Proposed Rule Change by the NationalAssociation of Securities Dealers, Inc.Relating to Amendments to theNASD's Proposed Short Sale Rule

December 3, 1993.Pursuant to section 19(b)(1) of the

Securities Exchange Act of 1934("Act"), 15 U.S.C. 78s(b)(1), notice ishereby given that on November 19.1993, the National Association ofSecurities Dealers, Inc. ("NASD" or"Association") filed with the Securitiesand Exchange Commission("Commission" or "SEC") the proposedrule change as described in Items I, II,and III below, which Items have beenprepared by the NASD. TheCommission is publishing this notice tosolicit comments on the proposed rulechange from interested persons.

I. Self-Regulatory Organization'sStatement of the Terms of Substance ofthe Proposed Rule Change

The NASD is amending its proposedshort sale rule or "bid test" applicableto stocks traded on the Nasdaq NationalMarket ("Nasdaq") by modifying the

19 See supra, note 4. letter from the MSRB.

2015 U.S.C. 78s(b)(2) (1988).2117 CFR 200.30-3(a)(12).

proposed limited exemption from therule for certain short sales effected byoptions market makers ("options marketmaker exemption"). Specifically, for aneighteen-month pilot period, theamended options market makerexemption provides that an NASDmember shall be permitted, consistentwith its quotation obligations, toexecute a short sale for the account ofan options market maker that wouldotherwise be in contravention of theNASD's short sale rule so long as theshort sales are hedges of existing orcontemporaneously established optionspositions and the options market makerreceives, or is eligible to'receive, goodfaith credit pursuant to section 220.12 ofRegulation T under the Act whenestablishing the short position, amongother things. Accordingly, thisAmendment No. 4 to the filingsupersedes and replaces the proposalscontained in Amendment No. 3 withrespect to "qualifying short sales"effected by options market makers. Inaddition, the NASD is proposing asimilar eighteen-month pilot for ahedging exemption for registeredwarrant market makers on Nasdaq. TheNASD also is proposing two other minoramendments to the NASD's short salerule that: (1) Clarify language pertainingto exempt market maker's risk arbitrageactivity; and (2) clarify how a marketmaker may become or remain aqualified market maker after theannouncement of a merger oracquisition involving two securities.

The text of the proposed rule changeis available at the Office.of the Secretaryof the NASD and at the Commission.

0. Self-Regulatory Organization'sStatement of the Purpose of, andStatutory Basis for, the Proposed RuleChange

In its filing with the Commission, theNASD included statements concerningthe purpose of and basis for theproposed rule change and discussed anycomments it received on the proposedrule change. The text of these statementsmay be examined at the places specifiedin Item IV below. The NASD hasprepared summaries, set forth insections (A), (B), and (C) below, of theMost significant aspects of suchstatements.

A. Self-Regulatory Organization'sStatement of the Purpose of, andStatutory Basis for, the Proposed RuleChange

As originally proposed, the NASD'sshort sale rule provided qualifiedNasdaq market makers with anexemption from the rule, however, therule did not exempt any options market

64994

a Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Notices

makers. The options exchanges andoptions market makers haveconsistently argued, among other things,that the absence of a parallel exemptionfor options market makers will have anadverse impact on the liquidity andpricing of options on Nasdaq securitiesand that it is inconsistent with the Actto afford Nasdaq market makers anexemption from the rule and not optionsmarket makers.,

The NASD continues to be cognizantand fully appreciative of the needs ofoptions market makers to effectivelyhedge theil long options positionsthrough short sales. At the same time,however, the NASD does not wantbroad and sweeping exemptions fromthe NASD's short sale rule to subsumethe rule and eviscerate its effectiveness.Accordingly, in December 1992, theNASD proposed an amendment to itsshort sale rule that would have providedoptions market makers with access toNasdaq's SelectNet service and a limitedexemption from the NASD's short salerule when an options market maker'sorder in SelectNet is traded through.2While the NASD continues to believethat this proposal provides optionsmarket makers with an adequate vehicleto effectively hedge their positions inoptions overlying Nasdaq stocks, theNASD believes a second approach.which relies on the surveillancecapabilities of the options exchanges,may also equally satisfy the needs of theoptions exchanges and the NASD.Accordingly, this revised optionsmarket maker exemption supersedesand replaces the exemption proposed inAmendment No. 3 to this filing.3

In essence; this alternative approachprovides options market makers with anexemption from the NASD's short salerule if the short sales are effected tohedge options positions established as aresult of bona fide market making

I See Securities Exchange Act Release No. 31729(January 13, 1993). 58 FR 5791 ("Amendment No.3 Notice"). See also, e.g., letter to Jonathan G. Katz,Secretary, SEC. from the American, New York.Pacific and Philadelphia Stock Exchanges and theChicago Board Options Exchange dated February18, 1993.

2 See Amendment No. 3 Notice supra note 1.3In the NASD's letter to the SEC responding to

comment letters submitted on the NASD's short salerule proposal, the NASD suggested that the optionsmarket maker exemption set forth in AmendmentNo. 3 to this filing be implemented on a one-yearpilot basis. Because this current amendment to thefiling supersedes and replaces the provisions inAmendment No. 3 concerning "qualifying shortsales" effected by options market makers, thesuggestion of a one-year pilot for these provisionsraised in the NASD's response letter likewise issuperseded and replaced by the current filing. Seeletter to Jonathan G. Katz, Secretary. SEC. fromRichard G. Ketchum. Executive Vice President &Chief Operating Officer, NASD. dated June 24,1993at p. 17.

activity. In order to ensure thatexemptions from the rule are onlygranted for legitimate hedgingtransactions associated with marketmaking activity, the proposal providesthat an options market maker cannotavail himself of the exemption unlessthe exchange of which he is a memberhas received SEC approval of certainrules governing its members usage of theexemption, which rules are described inmore detail below. In this connection,the NASD fully expects that the NASD'sshort sale rule and the correspondingrules of the options exchanges willbecome effective simultaneously.Nevertheless, if the NASD believes aparticular options exchange is notmoving forward in a good faith effort toseek SEC approval of the necessaryrules, the NASD will not delayunnecessarily the effective date of itsshort sale rule if other optionsexchanges have received SEC approvalfor their rules governing the exemption.

Specifically, under the amendedversion of the options market makerexemption an NASD member will bepermitted, consistent with its quotationobligations, to execute a short sale forthe account of an options market makerthat would otherwise be incontravention of the NASD's short salerule so long as: (1) The short sale is an"exempt hedge transaction"; and (2) theoptions market maker is registered witha "qualified options exchange" as a"qualified options market maker."4 An"exempt hedge transaction" is definedto be a short sale that was effected tohedge an existing offsetting optionsposition or an offsetting optionsposition that was created in atransaction(s) contemporaneous withthe short sale,5 provided that whenestablishing the short position theoptions market maker receives, or iseligible to receive, good faith marginpursuant to § 220.12 of Regulation Tunder the Act. A "qualified optionsexchange" is defined to be a nationalsecurities exchange that has receivedSEC approval of rules and proceduresgoverning: (1) The designation ofoptions market makers as qualifiedoptions market makers; (2) thesurveillance of its market makers'

4 The NASD notes, however, that an NASDmember would not be in violation of the NASD'sshort sale rule if it executed an order for the accountof an options market maker in the good faith beliefthat the order was in full compliance with theNASD's short sale rule and it was subsequentlydetermined that the order was either not entitled tothe exemption or it was incorrectly marked long.

5 The phrase contained in the proposed rule"contemporaneous with the short sale" is meant toinclude transactions occurring simultaneously aswell as transactions occurring within the same briefperiod of time.

utilization of the exemption; and (3)authorization of the NASD to withdraw,suspend, or modify the designation of aqualified options market maker in theevent that the options exchangedetermines that the qualified optionsmarket maker has failed to comply withthe terms of the exemption and theexchange believes that such action iswarranted in light of the substantial,willful, or continuing nature of theviolation.

Thus, an options market maker wouldbecome a "qualified options marketmaker" for certain classes of stockoptions only if it has received anappointment as such from a qualifiedoptions exchange. In this regard, therule is designed to ensure that onlythose options market makers whoregularly engage in making markets inoptions overlying Nasdaq-listedsecurities are designated as qualifiedoptions market makers. Specifically,before an options exchange can becomea qualified options exchange, it musthave rules in place to identify anddesignate as qualified options marketmakers those market makers whoregularly engage in market makingactivities in particular options classes.

In addition, to help ensure that theoptions market maker exemption willnot have an adverse market impact onNasdaq, the NASD believes that theIntermarket Surveillance GroupAgreement among and between theNASD and the options exchanges,among others, will serve as an effectivevehicle for the markets to evaluatepossible manipulative activity and otherpossibly market destabilizing shortselling activity by qualified optionsmarket makers and other options marketmakers in Nasdaq securities.

The NASD also has proposed that therevised options market makerexemption shall only be in effect for aneighteen-month pilot period.Throughout this eighteen-month period,the NASD will review and analyze withthe options exchanges whether theexemption is resulting in destabilizingtrading in Nasdaq stocks. In addition,should the NASD decline to modify,withdraw or extend the option marketmaker exemption before termination ofthe eighteen-month pilot period, theexemption will remain in effect untilthe exemption is so modified,withdrawn, or extended.

Similarly, the NASD is proposing toextend the same hedging exemption toregistered Nasdaq warrant marketmakers for an eighteen-month pilot,period. For the same rationale asdescribed above for granting optionsmarket makers a limited hedgingexemption, the NASD believes that an

64995


exemption should be afforded towarrant market makers. In addition, theNASD is clarifying that risk arbitrageactivities that are not linked to themember firm's market making activitieswill not, be considered as bona fidemarket making deserving of the marketmaker exemption. This language willclarify that registered Nasdaq marketmakers that qualify for the exemptionaccording to the standards of sections 46and 47 would relinquish their marketmaking exemption if the risk arbitragedepartment of the firm took over themarket making functions after theannouncement of a merger oracquisition. Finally, the NASD Isproposing a minor amendment tosection 46(1) (which previously wasdesignated as section 46(k) before thisamendment) to provide that thelanguage contained in section 46(l)(3)parallels language in section 46(1)(3)(iii)concerning how a market maker maybecome or remain a qualified marketmaker after the announcement of amerger or acquisition involving twosecurities.

The NASD believes the proposed rulechange is consistent with sections15A(b)(6) and 11A(c)(1)(F) of the Act.Section 15A(b)(6) requires that the rulesof a national securities association bedesigned to prevent fraudulent andmanipulative acts and practices, topromote just and equitable principles oftrade, to foster cooperation andcoordination with persons engaged inregulating, clearing, settling, processinginformation with respect to, andfacilitating transactions in securities,and to remove impediments to andperfect the mechanism of a free andopen market. Section 11A(c)(1)(F)assures equal regulation of all marketsfor qualified securities and all exchangemembers, brokers, and dealers effectingtransactions in such securities.Specifically, as noted in prior filingsregarding the NASD's short sale rule,approval of the proposed short sale rulewould result in equivalent short saleregulation in the exchange and Nasdaqmarkets and would work to preventfraud and manipulation with respect toshort sales in the Nasdaq market.Moreover, the NASD believes thataffording options market makers with anexemption from the rule for legitimatehedging transactions associated withtheir bona fide options market makingactivity will serve to minimize thepotential adverse impacts, if any, on theoptions markets resulting from adoptionof the NASD's short sale rule. Inaddition, in light of the safeguardsproposed in conjunction with theoptions market maker exemption (e.g.,

the eligibility of exempt short sales forgood faith margin treatment), the NASDdoes not believe that the revised optionsmarket maker exemption will subsumeor eviscerate the effectiveness of theNASD's short sale rule.

In addition, the NASD believes it isreasonable and appropriate to approvethe options market maker exemption onan eighteen-month pilot basis. As notedin prior NASD filings concerning theNASD's short sale rule, in the absenceof a comparable short sale rule for theoptions markets, it is not entirely clearto the NASD that abusive short sellerswill not be able to circumvent theNASD's short sale rule through use ofthe options markets. Specifically, ifoptions market makers are not requiredto adhere to the NASD's short sale rule,the NASD believes it is possible that"market participants could aggressivelybuy puts or sell calls confident in theknowledge that the options marketmakers likely to bear the other side ofthe contract would almost surelyemploy their short sale exemption tosell into the bid on Nasdaq.Accordingly, the NASD believes itwould be prudent and consistent withthe maintenance of fair and orderlymarkets to approve the options marketmaker exemption on an eighteen-monthpilot basis. During the term of the pilot,the NASD, in cooperation with theoptions exchanges, will conduct athorough analysis of the market impacts,if any, resulting from short sales effectedpursuant to the exemption. Dependingon the results of the study, the NASDwill consider whether to seekpermanent approval of the exemption,modify the exemption, or withdraw theexemption. In this connection, it is theNASD's intention to not modify orwithdraw the exemption unless it canbe shown that the exemption is causingdemonstrable harm to Nasdaq.Moreover, should it become clear duringthe term of the pilot that the optionsmarket maker exemption is having anadverse impact on Nasdaq, thet NASDwill endeavor to make a good faith effortto work with the options exchanges tocorrect or rectify the concernsassociated with the operation of theexemption before seeking to withdrawthe pilot. Finally, in order to minimizeunnecessary market disruption, shouldthe NASD fail to obtain SEC approval ofa proposal concerning the status orscope of the options market makerexemption by the termination of thepilot period, the proposal provides thatthe exemption will remain in effectuntil the SEC takes action on such aproposal.

Finally, for the above-noted reasons,the NASD believes a parallel eighteen-

month pilot program for a hedgingexemption for registered Nasdaqwarrant market makers Is consistentwith the Act. The NASD also believesthat the proposals to clarify the languageof the rule with respect to exemptmarket maker's risk arbitrage activityand the status of market makers asqualified market makers in the event ofa merger or acquisition of two securitieswill serve to reduce investors' confusionconcerning the application andoperation of the NASD's short sale rule,thereby promoting efficient and fairmarkets.


The NASD believes that the proposedrule change will not result in anyburden on competition that is notnecessary or appropriate In furtheranceof the purposes of the Act.


Comments were neither solicited norreceived.

MI. Date of Effectiveness of theProposed Rule Change and Timing forCommission Action

Within 35 days of the date ofpublication of this notice in the FederalRegister or within such longer period (i)as the Commission may designate up to90 days of such date if it finds suchlonger period to be appropriate andpublishes its reasons for so finding or(ii) as to which the NASD consents, theCommission will:

A. By order approve such proposedrule change, or

B. Institute proceedings to determinewhether the proposed rule changeshould be disapproved.


submit written data, views, andarguments concerning the foregoingamendment.e Persons making writtensubmissions should file six copiesthereof with the Secretary, Securitiesand Exchange Commission, 450 FifthStreet, NW., Washington, DC 20549.Copies of the submission, all subsequentamendments, all written statementswith respect to the proposed rulechange that are filed with theCommission, and all writtencommunications relating to the

*The commission has received ap proximately400 comment letters on the original proposed rulechange and Amendment No. 3 to the filing.Commentators are asked to limit their comments tothe changes proposed in Amendment No. 4.

64[996


proposed rule change between theCommission and any person, other thanthose that may be withheld from thepublic in accordance with theprovisions of 5 U.S.C. 552, will beavailable for inspection and copying inthe Commission's Public ReferenceRoom. Copies of such filing will also beavailable for inspection and copying atthe principal office of the NASD. Allsubmissions should refer to the filenumber in the caption above and shouldbe submitted by January 3, 1994.

For the Commission, by the Division ofMarket Regulation, pursuant to delegatedauthority.7Margaret H. McFarland,Deputy Secretary.[FR Doc. 93-30168 Filed 12-9-93; 8:45 am]BILLING COOE 010,01-N

[Release No. 34-3272; File Nos. SR-OCC-93-12 and SRI4CC-03-5

Self-Regulatory Organizations; TheOptions Clearing Corp. and TheIntermarket Clearing Corp.; OrderApproving Proposed Rule ChangesRelating to Trilateral Cross-MarginingWith the Commodity Clearing Corp.

December 2, 1993.On May 24, 1993, The Options

Clearing Corporation ("OCC") and TheIntermarket Clearing Corporation("ICC") each filed a proposed rulechange (File Nos. SR-OCC-93-12 andSR-ICC-93-5) with the Securities andExchange Commission ("Commission")under section 19(b)(1) of the SecuritiesExchange Act of 1934 ("Act")., Thepurpose of the filings is to enable OCCand ICC to establish a cross-marginingprogram among OCC, ICC, and theCommodity Clearing Corporation("CTCC).z The Commission publishednotice of these proposals in the FederalRegister on July 2, 1993.3 OCC and ICCfiled technical amendments to theirproposals on September 29, 1993.4 No

717 CFR 200.30-3(a)(12) (1989).

115 U.S.C. 78s(b)(1) (1988).2CDC acts as the clearing organization for certain

futures contracts and options on future contracts-forwhich FINEX, Inc., a division of the New YorkCotton Exchange, has been designated as thecontract market by the Commodity Futures TradingCommission pursuant to the Commodity ExchangeAct.

3Securities Exchange Act Release No. 31499(June 28, 1993) 58 FR 35992.

4 The amendments conform the terms of thecrss-margIning agreement between OCC, ICC, andCCC to the terms of the recently approved cross-margining agreement between OCC. ICC, and theChicago Mercantile Exchange. Letter from Jean M.Cawley. Staff Attorney. OCC. to Jerry W. Carpenter,Branch Chief, Division of Market Regulation("Division"). Commission (September 28, 1993) andletter from Jean Cawley, Staff Attorney, ICC. to Jerry

written comments were received. Forthe reasons discussed below, theCommission is approving the proposals.

I. DescriptionPursuant to the proposals, OCC, ICC,

and CCC will enter into a cross-margining agreement ("OCC/ICC/CCCX-M Agreement") to establish the OCC/ICC/CCC cross-margining program. TheOCC/ICC/CCC cross-margining programwill consist of trilateral cross-marginingamong OCC, ICC, and CCC and bilateralcross-margining between OCC and ICC,between OCC and CCC, and betweenICC and CCC. The OCC/ICC/CCC cross-margining program will include bothproprietary positions and non-proprietary, market professionalpositions.

The OCCICC/CCC X-M Agreementand the OCC/ICC/CCC cross-marginingprogram are substantially similar to thecross-margining agreement among OCC,ICC, and the Chicago MercantileExchange ("CME") ("OCC/ICC/CME X-M Agreement") and the OCC/ICC/CMEcross-margining program s except for thedifferences described below.

First, OCC, ICC, and CCC will notconduct any settlements on GoodFriday. Therefore. Good Friday is notdefined as a "business day" forpurposes of section 7 of the OCC/ICC/CCC X-M Agreement.

Second, the parties have determinedthat it is unnecessary to require that oralagreements be made over a recordedtelephone line and later confirmed inwriting. Accordingly, all referencesrelating to the use of recorded telephonelines in making oral agreements and toconfirming such agreements in writinghave been deleted from the OCC/ICC/CCC X-M Agreement. Such referencesare most notable in sections 5, 6, 7, and14 of the OCC/ICC/CME X-MAgreement.

Third, certain deadlines set forth inthe OCC/ICC/CCC X-M Agreement havebeen established to accommodate CCC'ssettlement times. These deadlines aremost notable in section 7 of the OCC/ICC/CCC X-M Agreement.

Fourth, provisions of section 8relating to the suspension of a clearingmember or a pair of affiliated clearingmembers and the liquidation of X-Maccounts have been drafted toaccommodate the inclusion of therestructured OCC/ICC cross-margining

Carpenter. Branch Chief, Division. Commission(September 28. 1993).

s For a detailed description of the OCC/ICC/CMEX-M Agreement and cross-margining program, referto Securities Exchange Act Release No. 32534 (June28, 1993), 58 FR 36234 (File Nos. SR-OCC-92-28and SR-lCC-92-5) (order approving OCC/ICC/CMEcross-margining program).

program.6 The basic formula for thesharing of any surplus or shortfallamong or between OCC, ICC, and CCC,however, is the same among andbetween OCC, ICC, and CME in theOCC/ICC/CME cross-marginingprogram.

Fifth, the list of contracts eligible forcross-margining is set forth in Exhibit Ato the OCC/ICC/CCC X-M Agreementand is tailored for the OCC/ICC/CCCcross-margining program.? The forms ofaccount agreements and subordinationagreements used in the OCC/ICC/CCCcross-margining program aresubstantially identical to those used inthe OCC/ICC/CME cross-marginingprogram.e

II. Discussion

The Commission believes that OCC'sand ICC's proposals are consistent withthe Act and in particular with section17A thereunder.9 As discussed below,the proposal will facilitate thedevelopment of linked or coordinatedclearing facilities for intermarketpositions.1o will promote the promptand accurate clearance anid settlement ofsecurities transactions, and appears to

e For a discussion of the restructured OCC/ICCcross-margining program, refer to SecuritiesExchange Act Release No. 32646 (July 18. 1993), 58FR 39587 (File Nos. SR-OCC-93--07 and SR-ICC-93-04) (notice of proposed rule changerestructuring OCC/ICC cross-margining program).7 Eligible OCC-cleared contracts Include put and

call options on the: (1) S&P 100 Index. (2) S&P 500Index. (3) Major Market Index. (4) New York StockExchange Composite Index. (5) Financial NewsComposite Index. (6) Institutional Index, (7)Deutschemark, (8) French Franc, (9) Swiss Franc,and (10) European Currency Units.

Eligible ICC-cleared contracts include futures andput and'call options on the futures on the New YorkStock Exchange Composite Index and futures on the(1) Deutschemark. (2) French Franc, (3) SwissFranc, and (4) European Currency Unit Futures.

Eligible CCC-cleared contracts include futuresand put and call options on the futures on the U.S.Dollar Index ("USDX").

&The account agreements and subordinationagreements used in the OCC/ICM/CME cross-margining program are Included in Amendment No.2 to File Nos. SR-OCC-92-28 and SR-ICC-92-5.

015 U.S.C. 78q-1 (1988).loSection 17A(a)(2)(A)(ii) (15 U.S.C. 78q-1

(a)(2)(A)(ii) (1990)). which was added to the Actwhen Congress enacted the Market Reform Act of1990 (Pub. L. No. 101-432. 104 Stat. 963 (1990)),directs the Commission to use its authority underthe Act "to facilitate the establishment of linked orcoordinated facilities for clearance and settlementof transactions in securities, securities options,contracts of sale for future delivery and optionsthereon, and commodity options." For a detaileddiscussion of the progress toward coordination orlinkage in the national clearance and settlementsystem, refer to Commission, Report on ProgressToward Establishing Linked or CoordinatedFacilities for Clearance and Settlement ofTransactions in Securities, Options, and Futures(March 5. 1993).

I I I I II I I I

64997


be designed to safeguard securities andfunds.21

Since it granted approval of the firstcross-margining program in 1988,12 theCommission repeatedly has found thatcross-margining programs are consistentwith clearing agency responsibilitiesunder section 17A of the Act. As theCommission previously noted, cross-margining programs, among otherthings, tend to enhance clearing memberand systemic liquidity both in times ofnormal trading and in times of stress.13By enhancing market liquidity, cross-margining programs reduce the risk thatclearing members will become insolventin times of extreme market stress.Furthermore, by enhancing marketliquidity, cross-margining arrangementsremove impediments to and help perfectthe mechanism of a national system forthe prompt and accurate clearance andsettlement of securities transactions.This in turn promotes the safety of theentire clearance and settlement systemby decreasing the threat of a rippleeffect of insolvencies caused by thedemise of a major market participant.14

As with other X-M arrangements, theproposal links and coordinates thevarious clearalice and settlementfacilities of options and futures clearingorganizations (OCC, ICC, and CCC inthis proposal) in an effort to manage

1" Section 17A(bX3)(F) provides, among otherthings, that the rules of a clearing agency must bedesigned to remove impediments to and perfect themechanism of a national system for the prompt andaccurate clearance and settlement of securitiestransactions and to assure the safeguarding of fundsand securities which are in the custody or controlof the clearing agency or for which it is responsible.15 U.S.C. 78q-l(b)(3)(F) (19088).12 Securitles Exchange Act Release No. 26153

(October 3,1988), 53 FR 39567 (approving non-proprietary cross-nmargining program between OCCand ICC).

13 See, e.g., Securities Exchange Act Release Nos.30413 (February 26. 1992) 57 FR 7830 (orderapproving OCC/Kansas City Board of TradeClearing Corporation cros-margining program forproprietary positions); 29991 (November 26, 1991),56 FR 61458 (order approving expansion of OCC/CME cross-margining program to include positionsheld for market professionals); 29888 (October 31,1991), 56 FR 56680 (order approving 0CC/Board ofTrade Clearing Corporation crossmarginingprogram for proprietary positions): 27296(September 26, 1989). 54 FR 41195 (order approvingOCC/CME cross-margining program for proprietarypositions).

1Shortly after the 1987 market break, thenTreasury Secretary Nicholas F. Brady referred to theclearance and settlement system as the weakest linkin the nation's financial system and noted thatimprovements to the clearance and settlementsystem, such as those provided by X-Marrangements, would "help ensure that a securitiesmarket failure does not become a credit marketfailure." The Market Reform Act of 1989: JointHearings on S. 648 before the Subcomm. onSecurities and the Senate Comm. on Banking,Housing, and Urban Affairs, 101st Cong., 1st Sess.225 (Oct. 26, 1989) (statement of Nicholas F. Brady,Secretary of the Treasury).

jointly the risks associated with clearingmembers' intermarket portfolios.5Cross-margining arrangements are asignificant improvement over the pastpractice where individual clearingorganizations were requiredindependently to manage the risk ofseparate components of clearingmembers' portfolios of options andfutures positions. Thus, cross-marginingprograms, such as the one proposedhere, facilitate the establishment oflinked or coordinated facilities forclearance and settlement of transactionsin securities options, futures, andoptions on futures in furtherance of thegoals of section 17A(a)(2)(A)(ii) of theAct.le

The OCC/ICC/CCC cross-marginingprogram is based on the OCC/ICC/CMEmodel, which embodies the concept ofequal control and interest in assets heldin cross-margin accounts. Furthermore,this program retains virtually all of theimportant safety provisions of the OCC/ICCJCME program. As with the OCC/ICC/CME cross-margining program, theCommission believes that the OCC/ICCCCC cross-margining program proposedhere is consistent with clearingagencies' statutory obligation to assurethe safeguarding of funds and securitieswhich are in their custody or control orfor which they are responsible.

Because the establishment of theOCC/ICC/CCC cross-margining programwill allow clearing members to cross-margin ICC-cleared contracts with CCC-cleared contracts, the amount of margindeposited on the futures side shoulddecrease appreciably. In addition,participating clearing membersgenerally will benefit through loweradministrative costs.17 Currently, theclearing organizations must maintaincross-margining accounts with multipleclearing banks. By extending cross-margining on both a bilateral basis anda trilateral basis, the proposal will allowparticipating clearing organizations tomaintain accounts at fewer clearingbanks and thereby will reduce costsassociated with such accounts. Thesecost savings, in turn, may be passed onto clearing members.

HI. ConclusionOn the basis of the foregoing, the

Commission finds that the proposed

'a Approximately 39 of OCC's 142 clearingmembers are registered beth as broker-dealers andas futures commission merchants. Telephoneconversations between Jean M. Cawley, StaffAttorney, OCC, and Peter R. Geraghty, Attorney,Division, Commission (October 15. 1993).

,a Supro note 10 and accompanying text."7Telephone conversation between Jean M.

Cawley, Staff Attorney. 0CC. and Peter R. Geraghty,Attorney, Division, Commission (October 15, 1993).

rule changes are consistent with the Actand in particular with section 17Athereunder.

It is therefore ordered, Pursuant tosection 19(b)[2) of the Act, that theproposed rule changes (File Nos. SR-OCC-93-12 and SR-ICC-93-5) be, andhereby are, approved.

For the Commission by the Division ofMarket Regulation, pursuant to delegatedauthority.leMargaret H. McFarland,Deputy Secretary.[FR Doc. 93-30169 Filed 12-9-93; 8:45 am)BILUNG CODE 00-.1-M

Self-Regulatory Organizations;Applications for Unlisted TradingPrivileges; Notice and Opportunity forHearing; Chicago Stock Exchange, Inc.

December 3, 1993.The above named national securities

exchange has filed applications with theSecurities and Exchange Commission("Commission") pursuant to section12(f)(1)(B) of the Securities ExchangeAct of 1934 and Rule 12f-1 thereunderfor unlisted trading privileges in thefollowing securities:Chateau Properties, Inc.


Benson Eye CareCommon Stock, S.01 Par Value (File No. 7-

11611)Harte Hanks Communications, Inc.

Common Stock, $1.00 Par Value (File No.7-11612)

MuniBond Income Fund, Inc.Common Stock, $.10 Par Value (File No. 7-

11613)MuniYield Arizona Fund II, Inc.


American Real Estate Investment CorporationCommon Stock, $.001 Par Value (File No.

7-11615)SunCoast Plastics, Inc.


NVR, L.P.Common Stock, $.01 Par Value (File No. 7-

11617)NVR, L.P.

Warrants, No Par Value (File No. 7-11618)Hill Stores Company


Triarc Companies, Inc.Common Stock, $.10 Par Value (File No. 7-

11620)CV Reit

Rights to Subscribe, No Par Value (File No.7-11621)

Asia Pacific Fund, Inc.Rights to Subscribe, No Par Value (File No.

7-11622)Mexico Equity & Income Fund, Inc.

Is17 CFR 200.30-3(a)(12) (1992).

64998



Salant CorporationWarrants, No Par Value (File No. 7-11624)

Hillhaven Corporation- Common Stock, $.75 Par Value (File No. 7-

11625)Alumax. Inc.


Frederick's of HollywoodClass A Capital, $1.00 Par Value (File No.

7-11627)Frederick's of Hollywood

Class B Capital, $1.00 Par Value (File No.7-11628)

Prospect Street High Income Portfolio, Inc.Rights to Subscribe, No Par Value (File No.

7-11629)Singapore Fund, Ind.


United States Cellular CorporationRights to Subscribe, No Par Value (File No.

7-11631)MHI Group. Inc.

Common Stock. S.40 Par Value (File No. 7-11632)

Allerion, Inc.Common Stock, No Par Value (File No. 7-

11633)Continental Airlines

Class B, $.01 Par Value (File No. 7-11634)Gaylord Container

Warrants, No Par Value (File No. 7-11635)Asia Tigers Fund, Inc.

Common Stock, $.001 Par Value (File No.7-11036)

Hawaiian AirlinesCommon Stock, $3.00 Par Value (File No.

7-11637)Heritage U.S. Government Income Fund

Shares of Beneficial Interest (File No. 7-11638)

Korea Equity Fund, Inc.Common Stock, $.10 Par Value (File No. 7-

11639)Morgan Stanley High Yield Fund, Inc.


National Intergroup$4.20 Cum. Exch. Ser. A Pfd. Stock, No Par

Value (File No. 7-11641)Trans World Airlines

When Issued Voting Trust Certificates, NoPar Value (File No. 7-11642)

These securities are listed andregistered on one or more other nationalsecurities exchange and are reported inthe consolidated transaction reportingsystem.

Interested persons are invited tosubmit on or before December 27, 1993,written data, views and argumentsconcerning the above-referencedapplication. Persons desiring to makewritten comments should file threecopies thereof with the Secretary of theSecurities and Exchange Commission,450 Fifth Street, NW., Washington, DC-20549. Following this opportunity forhearing, the Commission will approvethe application if it finds, based uponall the information available to it, that

the extensions of unlisted tradingprivileges pursuant to such applicationis consistent with the maintenance offair and orderly markets and theprotection of investors.I For the Commission, by the Division of

Market Regulation, pursuant to delegatedauthority.Jonathan G. Katz,Secretary.[FR Doc. 93-30170 Filed 12-9-93; 8:45 am]DILUNG CODE 8010-01-M

[Release No. 35-25937]

Filings Under the Public Utility HoldingCompany Act of 1935 ("Act")

December 3, 1993.Notice is hereby given that the

following filing(s) has/have been madewith the Commission pursuant toprovisions of the Act and rulespromulgated thereunder. All interestedpersons are referred to the application(s)and/or declaration(s) for completestatements of the proposedtransaction(s) summarized below. Theapplication(s) and/or declaration(s) andany amendments thereto is/are availablefor public inspection through theCommission's Office of PublicReference.

Interested persons wishing tocomment or request a hearing on theapplication(s) and/or declaration(s)should submit their views in writing byDecember 27, 1993, to the Secretary,Securities and Exchange Commission,Washington, DC 20549, and serve acopy on the relevant applicant(s) and/ordeclarant(s) at the address(es) specifiedbelow. Proof of service (by affidavit or,in case of an attorney at law, bycertificate) should be filed with therequest. Any request for hearing shallidentify specifically the issues of fact orlaw that are disputed. A person who sorequests will be notified of any hearing,if ordered, and will receive a copy ofany notice or order issued in the matter.After said date, the application(s) and/or declaration(s), as filed or as amended,may be granted and/or permitted tobecome effective.

Jersey Central Power & Light, et al. (70-8182)

Jersey Central Power & LightCompany ("JCP&L"), 300 MadisonAvenue, Morristown, New Jersey 07960,Metropolitan Edison Company ("MEC"),2800 Pottsville Pike, Reading,Pennsylvania 19605, PennsylvaniaElectric Company ("PEC"), 1001 BroadStreet, Johnstown, Pennsylvania 15907,GPU Service Corporation ("Service"),100 Interpace Parkway, Parsippany,

New Jersey 07054, and GPU NuclearCorporation ("Nuclear" and, togetherwith JCP&L, PEC, MEC, and Service,"Applicants"), One Upper Pond Road,Parsippany, New Jersey 07054, each asubsidiary company of General PublicUtilities Corporation, a registeredholding company, have filed adeclaration pursuant to sections 6(a)and 7 of the Act.

The Applicants each seek authoritythrough December 31, 1996 to borrowfunds under installment creditagreements (each a "Credit CardAgreement") that each company wouldestablish with one or more financialinstitutions. Pursuant to suchagreements, the financial institution orinstitutions would issue credit cards todesignated employees of such companyto purchase small purchases of goodsand services for the company.

It is anticipated that the credit cardissuer would establish accounts withcertain specified vendors who regularlyprovide goods and services to one ormore Applicants. These vendors wouldthen accept orders from designatedemployees of an Applicant against suchaccounts. The Applicants state thatconducting such purchases wouldreduce the time and documentationassociated with the current system ofmaking such purchases using petty cashand limited purchase orders. The cardswould not be for employees' personaluse.

In a prior order dated March 18, 1992(HCAR No. 25493), the Commissionauthorized each of JCP&L, MEC and PECto engage in short-term borrowings inamounts that did not exceed its charterlimits. As of December 31, 1991, thislimit was set at $236 million, $95million and $123 million for JCP&L,MEC and PEC, respectively. JCP&L,MEC and PEC state that the amountsborrowed by each under its Credit CardAgreement would not, when combinedwith borrowed amounts authorized inthat order, exceed the borrowing limitson each of those Applicants specified inthat order. Further, the amountsborrowed by all Applicants under allCredit Card Agreements would notexceed $3 million-at any one time.

Under each Credit Card Agreement,an Applicant would be given a specifiedperiod of time, which would be no lessthan ten days following receipt of astatement from the credit card issuer, torepay in full all charges billed in thatstatement. After that period, the issuerwould be entitled to assess interest onunpaid balances in an amount not toexceed 125% of the credit card issuer'sor other recognized prime rate perannum. In addition, the credit cardissuer would be entitled to assess a

64999


separate late charge in an amount not toexceed one percent of the unpaidbalance, if payment of that balance werenot made within a specified longerperiod of time following receipt of thestatement from the credit card issuer,which period would be no less thanthirty days. Additionally, under eachCredit Card Agreement, an Applicantwould pay an annual fee not to exceed'$25 for each card issued.

The Southern Company (70-8277)The Southern Company ("Southern"),

64 Perimeter Center East, Atlanta,Georgia 30346, a registered holdingcompany,'has filed an application-declaration under sections 6(a), 7, 12(b),32 and 33 of the Act and Rules 45, 50,50(a)(5) and 53 thereunder.

Southern proposes to issue and sellup to ten million shares of itsauthorized but unissued common stock,par value $5 per share, as such numbermay be adjusted for any share split ordistribution hereafter authorized by theCommission ("Common Stock"), in oneor more transactions from time to time,through December 31, 1996.

Southern proposes to effect the,issuance and sale of some or all of theshares of the Additional Common Stockthrough a primary shelf registrationprogram in accordance with Rule 415under the Securities Act of 1933, asamended. Southern further proposes toenter into a Sales Agency Agreement("Agreement") with a broker/dealer("Agent") providing for the offer andsale of some or all of the Common Stocksubject to the terms and conditionsstated therein.

Accordingly, Southern would appointthe Agent exclusively for the purpose ofoffering and selling the Common Stockby one or more of the followingmethods: (1) In ordinary regular-waytransactions in the auction market onthe floor of the New York StockExchange, or any regional exchange onwhich Southern's common stock may beadmitted to trading privileges; (2) inblock transactions of such exchanges orin the over-the-counter market, in whichthe Agent may act as a principal for itsown account; and (3) in "fixed-priceofferings' off the floor of suchexchanges, or "special offerings" and"exchange distributions" in accordancewith the rules of such exchanges.

The sale of the Common Stock will bemade at market prices prevailing at thetime of sale in the case of transactionson exchanges and at prices negotiatedby the Agent and related to prevailingmarket prices in the case of over-the-counter transactions. Southern proposesto issue and sell the Common Stockunder methods (1) and (2) above

pursuant to the alternative competitivebidding procedures as modified by theCommission's Statement of Policy datedSeptember 2, 1982 (HCAR No. 22623).Southern states that it will eithercomply or by amendment herein willrequest an exception from suchrequirements in connection with sale ofCommon Stock pursuant to (3) aboveshould circumstances develop which, inthe opinion of Southern's management,make such exception in the bestinterests of Southern and its investorsand consumers. The Commission isrequested to reserve jurisdiction overthe sale by Southern of any of theCommon Stock pursuant to anexception from the requirements ofcompetitive bidding under Rule 50.

Southern proposes to use the netproceeds from the sale of the CommonStock, together with other availablefunds, to make additional equityinvestments in subsidiary companies.Such investments will include cashcapital contributions to Southern'soperating utility subsidiary companiesand in exempt wholesale generators("EWG") and foreign utility companies("FUCO"), as defined in Sections 32 and33, respectively, such that its subsidiarycompanies are permitted to acquire andown, and to fund ongoing developmentcosts associated with potential direct orindirect investments by Southern insuch entities, and for other corporatepurposes.

Investments by Southern insubsidiary companies would only bemade in accordance with existing orfuture authorizations in separateproceedings, or in accordance with suchexemptions as may exist under the Actand the rules and regulationsthereunder. Southern currently hasauthority to make investments inSouthern Company Services, Inc.(HCAR No. 25874), Southern ElectricInternational, Inc. (HCAR No. 24476),and Southern Nuclear OperatingCompany (HCAR No. 25792), each ofwhich is a wholly-owned non-utilitysubsidiary company. Southernrepresents that no part of the proceedsfrom the sale of the Common Stock willbe utilized by Southern ElectricInternational, Inc. for a purpose that iscurrently permitted under HCAR No.24476 unless such purpose would alsobe permitted under an order in File No.70-7932. Presently, Southern does nothave authority to make additionalinvestments in its operating utilitysubsidiary companies, but intends torequest such authority in a separatefiling.

Southern proposes to guarantee thesecurities of one or more EWG or FUCOfrom time to time through December 31,

1996, in an aggregate amount not toexceed $500 million at any one timeoutstanding ("Guarantees"), providedthat any Guarantee outstanding onDecember 31, 1996 shall remaineffective until expiration- or terminationin accordance with its terms.

Southern anticipates that the capitalcosts of EWGs and FUCOs, in which itmay invest, will be financed in part byloans obtained from banks and otherinstitutional lenders that are securedsolely by the assets and revenues ofsuch entities and that are otherwisenon-recourse to Southern. However,Southern expects that it will benecessary from time to time to guaranteecertain amounts of the indebtedness orfinancial commitments of such EWGs orFUCOs.

Entergy Corporation (70-8299)

Entergy Corporation, 225 BaronneStreet, New Orleans, Louisiana 70112("Entergy"), a registered holdingcompany, has filed an application-declaration with the Commissionpursuant to sections 6(a), 7, 9(a), 10 and12(c) of the Public Utility HoldingCompany Act of 1935, as amended("Act") and Rules 42 and 50(a)(5)thereunder. The original notice of thisfiling was issued by the Commission onNovember 19, 1993 (HCAR No. 25927).

Entergy, as further defined below,requests authority through March 31,1997 to issue from time to time up to 2million shares of its common stock, parvalue of $5 per share, or any securityissued in exchange for such stock("Stock"), in connection with aproposed nonstatutory Stock InvestmentPlan ("Plan"). For the purposes of thePlan, Entergy would include anycompany that is a successor in interest,including the surviving corporationfollowing the proposed merger ofEntergy and Gulf States UtilitiesCompany. Under the Plan, eligibleemployees ("Eligible Employees") ofEntergy and of other participatingcompanies (collectively, "ParticipatingEmployers") would be granted options("Options") to purchase shares of Stock.In addition to Entergy, ParticipatingEmployers would include anycorporation (a) 50% or more of thecommon stock of which is owned,directly or indirectly, by Entergy and (b)which is, from time to time, designatedas a Participating Employer in the Plan.Designation as a Participating Employerwould be made by a committee, moreparticularly described below("Committee"), that is charged withadministering the Plan. EligibleEmployees generally would include allregular, full-time employees of aParticipating Employer, including those

65000


employees who at the time of the grantof the applicable Option, are on paidleave of absence.

The purpose of the Plan is to provideEligible Employees of Entergy and otherParticipating Employers with anopportunity to acquire a proprietaryinterest in Entergy through the purchaseof Stock. Entergy would make threeconsecutive annual offerings("Offerings") of Stock, eachcorresponding to a twelve month period("Plan Year") commencing on April 1("Commencement Date") and endingMarch 31 of the following year("Termination Date"). The first PlanYear with respect to the Plan would bethe twelve month period beginningApril 1, 1994 and ending March 31,1995. An Eligible Employee wouldbecome a participant with respect to anyOffering ("Participant") by enrolling inthe Offering prior to the applicableCommencement Date and authorizingpayroll deductions during the course ofthe corresponding Plan Year. AParticipant could authorize deductionsup to a maximum level of 10% of theParticipant's base pay to pay for theStock which is covered by theParticipant's option. Generally, eachParticipant would be granted an Optionon each Commencement Date topurchase the most amount of Stock("Option Shares") allowed by theamount credited to his account on theTermination Date with respect to thatOffering at the Option exercise price.The Option exercise price ("ExercisePrice") with respect to any Offeringwould be the lower of:

a. 85% of the closing price of theCommon Stock on the CommencementDate for that Offering or the nearestprior business day on which tradingoccurs on the New York StockExchange; or

b. 85% ofthe closing price of theCommon Stock on the Termination Datefor that Offering or the nearest priorbusiness day on which trading occurson the New York Stock Exchange.

Unless a Participant elected towithdraw from the Plan with respect toany Offering, the Participant's Optionwould be deemed to be automaticallyexercised on the applicable TerminationDate for the purchase of the number ofOption Shares covered by the Option.Such purchase would be reflected by anappropriate entry on Entergy's booksand records evidencing that the OptionShares purchased by a Participant withrespect to the Offering had beenacquired by the Participant as of thatdate. Any excess amount credited to theParticipant's account would be paid tothe Participant in cash. If a Participantwithdrew from an Offering prior to the

exercise of the applicable Option, hewould receive a refund of funds paid,less administrative expenses.

The Plan would be administered by acommittee whose members would beappointed by the Chairman of the Boardof Directors of Entergy. The Committeewould consist of no fewer than threemembers selected from directors,officers or employees of Entergy and ofother Participating Employers("Committee"). Subject to the expressprovisions of the Plan, the Committeewould have the exclusive authority tointerpret and construe any and all of itsprovisions and to make all other 'determinations deemed necessary oradvisable for its administration. TheCommittee may, in its discretion, permitParticipants to make contributions byone or more lump sum payments, inaddition to payroll deductions. Suchpermission would be subject to, interalia, the condition that the total of allamounts credited to a Participant'saccount in any Plan Year could in noevent exceed 10% of the Participant'sbase pay.

It is proposed that the Option Sharesbe issued from treasury shares, ratherthan from newly, issued shares.Therefore, Entergy requests authorityunder the Act to purchase from time totime during the period through March31, 1997, up to a maximum of 2 millionshares of Stock on the open market, tobe held as treasury shares, pendingresale to Participants, for the purpose ofsatisfying the anticipated requirementsof the Plan. The timing of suchpurchases would depend upon theanticipated needs of the Plan and then-existing market conditions. Funds forthe purchase of shares of Stock from theopen market to satisfy the requirementsof the Plan would be obtained frominternally generated funds. Proceedsfrom the sale of shares of Stock underthe Plan will become part of the generalcorporate funds of Entergy and will beused (i) to purchase Stock of Entergysold or to be sold by Entergy under thePlan, or (ii) for other general corporatepurposes.

Entergy additionally requests anexemption from the competitive biddingrequirements of Rule 50 under the Actpursuant to subsection (a)(5) thereofwith respect to the issuance of theOptions and the issuance and sale ofStock pursuant to the Plan.

For the Commission, by the Division ofInvestment Management, pursuant todelegated authority.Margaret H. McFarland,Deputy Secretary.[FR Doc 93-30172 Filed 12-9-93; 8:45 am]BILLING CODE 8010-01-

DEPARTMENT OF STATE

Bureau of Politico-Military Affairs[Public Notice 19091

Determinations Under the Arms ExportControl Act and the ForeignAssistance Act of 1961

Pursuant to section 654(c) of theForeign Assistance Act of 1961, asamended (the "Act"), notice is herebygiven that the President has made adetermination pursuant to section 498Aof the Act and has concluded thatpublication of the determination wouldbe harmful to the national security ofthe United States. Pursuant to section654(c) of the Act, notice is further giventhat the Under Secretary of State forInternational Security Affairs has madea determination pursuant to section 81of the Arms Export Control Act and hasconcluded that publication of thedetermination would be harmful to thenational security of the United States.

Dated: November 22, 1993.Robert L Gallucci,Assistant Secretary of State for Politico-Military Affairs.[FR Doc. 93-29999 Filed 12-9-93; 8:45 am]BILLING CODE 4710-25-M


Aviation Proceedings; AgreementsFiled During the Week EndedDecember 3, 1993

The following Agreements were filedwith the Department of Transportationunder the provisions of 49 U.S.C 412and 414. Answers may be filed within21 days of date of filing.Docket Number: 49286Date filed: December 1, 1993Parties: Members of the International

Air Transport AssociationSubject: TC123 Reso/P 0114 dated

November 9, 1993 North/Mid/SouthResolutions r-1 to r-8 Minutes-TC123 Meet/P 0051 dated November26, 1993 Tables-TC123 Fares 0037dated November 30, 1993

Proposed Effective Date: March 1, 1994.Docket Number: 49287Date filed: December 1, 1993Parties: Members of the International

Air Transport AssociationSubject: COMP Telex Mail Vote 657

Rounding Unit for EgyptProposed Effective Date: December 15,

1993.Docket Number: 49291Date filed: December 3. 1993Parties: Members of the International

Air Transport Association

65001


Subject: TC23 Reso/P 0613 datedOctober 8, 1993 Europe-South AsianSubcontinent r-1 to r-15.

Proposed Effective Date: January 1,1994.

Phyllis T. Kaylor,Chief. Documentary Services Division.iFR Doec. 93-30207 Filed 12-9-93; 8:45 am]BILUNG CODE 491042-P

Applications for Certificates of PublicConvenience and Necessity andForeign Air Carrier Permits Filed UnderSubpart Q During the Week EndedDecember 3, 1993

The following Applications forCertificates of Public Convenience andNecessity and Foreign Air CarrierPermits were filed under subpart Q ofthe Department of Transportation'sProcedural Regulations (See 14 CFR302.1701 et. seq.). The due date forAnswers, Conforming Applications, orMotions to Modify Scope are set forthbelow for each application. Followingthe Answer period DOT may process theapplication by expedited procedures.Such procedures may consist of theadoption of a show-cause order, atentative order, or in appropriate casesa final order without furtherproceedings.Docket Number: 49283Date filed: November 30, 1993Due Date for Answers, Conforming

Applications, or Motion to ModifyScope: December 28, 1993

Description: Application of FederalExpress Corporation, pursuant tosection 401(d)(1) of the Act, andsubpart Q of the Regulations forrenewal of its existing authority toprovide foreign air transportation ofproperty and mail between a point orpoints in the United States, on the onehand, and a point or points in Italy,on the other hand, as contained inSegment I of Federal Express'certificate of public convenience andnecessity for Route 119, and ascontained in Federal Express'certificate of public convenience andnecessity for Route 553.

Docket Number: 49284Date filed: November 30, 1993Due Date for Answers, Conforming

Applications, or Motion to ModifyScope: December 28, 1993

Description: Application of FederalExpress Corporation, pursuant tosection 401(d)(1) of the Act andsubpart Q of the Regulations, forrenewal of its existing authority toprovide foreign air transportation ofproperty and mail between a point orpoints in the United States, on the one

hand, and a point or points in thePhilippines, on the other hand, ascontained in Segment 3 of FederalExpress' certificate of publicconvenience and necessity for Route205-F.

Phyllis T. Kaylor,Chief, Documentary Services Division.IFR Doec. 93-30208 Filed 12-9-93; 8:45 amlBILUNG CODE 4910-82-P

Federal Aviation Administration

(AC No. 120-XXI

Development of Advisory Circular (AC)on Flightcrew Sleeping Quarters/Facilities

AGENCY: Federal AviationAdministration (FAA), DOT.ACTION: Notice of FAA intent to considerthe design and installation criteria forflightcrew rest facilities on commercialtransport aircraft contained inAerospace Recommended Practice(ARP) 4101/3 in the development of AC120-XX, Flightcrew Sleeping Quarters/Facilities; and request for commentsconcerning the adequacy andappropriateness of these criteria.

SUMMARY: This notice contains a reprintof the Society of Automotive Engineers(SAE) document ARP4101/3, Crew RestFacilities, which contains informationthat the FAA intends to consider indevelopment of AC 120-XX, FlightcrewSleeping Quarters/Facilities. Whendeveloped and issued, this AC wouldprovide guidance for one means, but notthe only means, for Federal AviationRegulations (FAR) parts 121 and 135certificate holders to obtain an FAAfinding regarding the adequacy ofsleeping quarters/facilities to be used forflight crewmembers sleeping in flight.These sleeping quarters/facilities wouldbe used: (1) By three- and four-pilotcrews during long-range flights underFAR part 135; and (2) when applicable,by flight crewmembers in the conduct offlag and supplemental operations underFAR part 121. This notice gives allinterested persons an opportunity topresent their views on the adequacy ofthe information in the subject SAEdocument for the purpose describedherein. The FAA will consider allcomments received prior to issuing anynotice of availability of draft AC 120-XX, Flightcrew Sleeping Quarters/Facilities.DATES: Comments must be received onor before February 6, 1994.ADDRESSES: Send all comments on thesubject SAE document to: FederalAviation Administration, Air Carrier

Branch, AFS-220, 800 IndependenceAvenue, SW., Washington, DC 20591.Comments may be inspected at theabove address between 9 a.m. and 4p.m. weekdays, except Federal holidays.FOR FURTHER INFORMATION CONTACT: DonStreeter, AFS-220, at the address above,telephone (202) 267-7579.SUPPLEMENTARY INFORMATION: Indeveloping a flightcrew sleepingquarters/facilities AC, the FAA intendsto provide standard technicaldefinitions and guidelines for FAR part121 certificate holders and, based oncomments received, FAR part 135certificate holders. The definitions andguidelines would then be used by thesecertificate holders to develop plans fora sleeping quarters installation in aparticular type airplane and to obtain anFAA finding regarding the ad&quacy ofthat installation for sleeping purposes.This AC will reference recommendedguidelines based on suggested criteriacontained in ARP4101/3 for the designand installation of crew rest facilities oncommercial transport aircraft capable ofultra-long-range operations withaugmented/enlarged crew complements.

FAR section 135.269 permitscertificate holders to assign three- orfour-pilot crews to flights havingextended duty periods, under certainconditions. One condition that must bemet to authorize such assignments isthat adequate sleeping quarters must beavailable for use on such flights. TheFAA recognizes that accepting certainguidance criteria in ARP4101/3 may bedifficult for FAR part 135 operators.Therefore, comments from FAR part 135operators regarding the adequacy of theARP4101/3 criteria are requested toensure the development of equitableguidelines. S!ome of the issues in needof comment are:

(1) Aircraft size is limited under FARpart 135, therefore, recognizing the sizedifferential, should or can the ARP4101/3 criteria be applied to FAR part 135aircraft?

(2) Should the proposed AC includeFAR part 135 guidelines? If so, shouldthe FAR part 135 guidelines be separatefrom the FAR part 121 guidelines?

(3) Should a separate AC bedeveloped for FAR part 135 operators?

(4) What additions or changes in theARP4101/3 criteria would be needed toaccommodate the needs of FAR part 135operators? The following related SAEdocuments may also prove to be usefulin the development of the draft AC:SAE ARP4101-Flight Deck Layout and

FacilitiesSAE ARP4101/4-Flight Deck

Environment

65002


SAE ARP1323-Type Measurements of Copies of these documents may beAircraft Interior Sound Pressure obtained, for a fee, by contacting: SAE,Levels During Cruise The Engineering Society For Advancing

SAE AIR 4245-Quantities for Mobility Land, Sea, Air, and Space

Description of the Acoustical International, 400 Commonwealth

Environment in the Interior of Aircraft Drive, Warrendale, PA 15096-0001,

Attention: Mr. Richard A. Vandame, Jr.,telephone (412) 776-4841.

Issued in Washington, DC, on December 6,1993.Donald W. Streeter,Acting Branch Manager, Flight Standards, AirCarrier Operations Branch.

65003


dAEROSPACEFor Advancent Mobillt

b L;nd S" A pw S . RECOMMENDED ME ARP4101/3INTERNATIONAL400 Commonwealth Drive, Warrendale, PA 15096-0001 PRACTICE Issued 1992-02-28

Sulhom ed for re1ogrlton s an Amer1can I atbwal Standard

CREW REST FACILITIES

1. SCOPE:

This document recommends criteria for the desiqn and installation of flightcrew rest facilities on commerc'ial transport aircraft capable of ultralong-range operations with augmented/enlarged crew complement.

2. REFERENCES:

2.1 This annex should be used in conjunction with ARP4101 Core Document.following documents may also be applicable:

SAE ARP4]O1/4SAE ARP13?3

SAE AIR4245

Flight Deck EnvironmentType Measurements of AircraftLevels During CruiseQuantities for Description ofthe Interior of the Aircraft

Interior Sound Pressure

the Acoustical Environment in

2.2 Definitions:

CREW REST FACILITY: An area designed for the purpose of providing sleeping,stowage, and changing clothes for off-duty flight crew.

SLEEPING AREA: Any area designated for the purpose of providing an isolatedspace with a horizontal sleeping surface for the off-duty flight crew.

SLEEPING SURFACE: Any horizontal surface such as a bed, bunk, or sleepingseat that meets the criteria defined by this ARP.

FREE SPACE: An area designated for the use of the crew to change and stowclothing.

SAE Technical Standards Board Rules provide ftat 'This reporl is "i!ed by SAE to airance the state of iectinic and englningsciences The use of tris report is entirety voluntary. end Its apphcabdty and u tLpdty kW any partclular Use, knku*n any patentmfringement ansig therefrom. s the sole respotsilbty of the user.

SAE reviews each technical report at least every live years at vhich ie I ry be rMffimed. revised. Or caelled. SAE Wvts yOLKwntten comments and sjggestans

Copyright 1992 Society o Aulomrnoive Engineers, nc.AN nrts reserved

65004

Pred in U.S.A,


SAE ARP4O/3

3. OPERATIONAL REQUIREMENTS:

3.1 Crew Rest Fjcility:

The facility should be located close to the flight deck, but physicallyisolated from active areas. It should contain sleeping and free-space areas.

3.1.1 The resting crew shall be able to control access to a nearby lavatory thatincorporates provisions for assuring privacy when entering or leaving.

3.1.2 The entrance door shall have a device to prevent passengers from enteringthe rest area.

3.1.3 Adequate volume shall be provided for sleep, personal storage, and changing

of clothes. The following volumes are recommended:

a. Individual sleeping volume: 1.0 m" (35 ft").

b. Free space adjacent to the sleeping surfaces for ingress/egress andchanging of clothes: 1.85 m' (65 ft').

3.2 Sleeping Surface Criteria:

Minimum dimensions for each sleeping surface shall be 1.98 x 0.76 m(78 x 30 in).

3.2.1 Minimum spacing for an over and under sleeping surface arrangement shouldbe 0.66 m (26 in). The space above the upper surface should not be lessthan 0.66 m (26 in). The interior aircraft contour should not impinge atan angle of more than 35 degrees.

3s" 0

T.66.aN

LOAR BUNK

FIGURE 1 - Crew Rest Facility Cross Section

-2-

65005


SAE ARP4101/3

3.2.2 The sleeping surfaces should be designed so that they are As level aspracticable during cruise.

3.2.3 If coovertible seats are used for sleeping surfaces, they shall have asmooth, even surface when in the horizontal position.

3.2.4 Suitable means should be provided to assure the required privacy for eachsleeping area such as curtains in an over-and-under arrangement or adivider/curtain in a side-by-side arrangement.

3.3 Isolation:

The crew rest area shall be located where noise, odors, and vibration can bekept to a minimum. The crew rest area should be located in close proximityto the flight deck. Noise level should be equal or lower than the best noiseenvironments on the aircraft. The noise spectra should be broadband and freeof tones. Maximum noise levels during cruise flight in the range of 70-75db(A) are considered reasonable design objectives. A 70 db(A) maximum shouldbe the design goal.

Special attention should be given to the design of doors,'systems, publicaddress systems, etc. in the immediate area to minimize intrusive noise.

3.4 Environmental:

Airflow and temperature control shall provide a uniformly well-ventilatedatmosphere, free from draft, cold spots, and temperature gradient. Thesleeping area should be designated a nonsmoking area. Installation of ahumidifier may be considered.

3.5 Alerting Device:

An aural attention-getting device shall be provided to alert crew members toreturn to the flight deck. A two-way communication system with the flightdeck is mandatory if the rest area is not adjacent to the flight deck. Aone-way call system is recommended to establish communication with the mainflight attendant station.

The public address system shall have provision to exclude the rest area from

nonrelevant announcements.

3.6 Lighting:

Separate, controllable reading lights shall be provided for each sleepingsurface with provision for light shielding of the other surfaces.

.7 Stowage and Restraints:

Suitable stowages and restraints shall be provided to prevent unwanted motionof all personal belongings in severe turbulence (flight bags, clothing, andshoes). Each sleeping surface shall have adequate restraints for theprotection of the occupant during severe turbulence.

-3-

65006

Federal Register / V'ol. 58, No. 236 / Friday, December 10. 1993 / Notices

SAE ARP4101/3

1. Emergency Equipment:

Cmergency oxygen equipment and appropriatu visual signals such as 'NOSMOKING" and OFASTEN SEAT BELTSO shall be provided. A smoke detector shallbe provided. Additional items of emergency equipment will be required if notimmediately available in close proximity to crew rest facility (smoke hood,or protective breathing equipment, BCF extinguisher, fire gloves).

3.O ionsleeping Accommodations:

Consideration should be given to providing seating for off-duty crew membersfor rest and relaxation with IFE audio and visual. If Installed, independentcontrols shall be provided for each crew member. Location and size of visualdisplays shall not cause interference to other crew member(s).

PR rARED BY SAE COMMITTEE S-7,FLIGHT DECK AND HANI.ING QUALITIES STANDARDS FOR TRANSPORT AIRCRAFT

-4-

I I 6500765007


IFR Doc. 93-30258 Filed 12-9-93; 8:45 am]BILUNG CODE 4910-13-"


Environmental Impact Statement:Windham County, VT

AGENCY: Federal HighwayAdministration (FHWA), DOT.ACTION: Notice of intent.

SUMMARY: The FHWA is issuing thisnotice to advise the public that anenvironmental impact statement will beprepared for a proposed highway project[NH 010-1(33)] in Windham County,VT.FOR FURTHER INFORMATION CONTACT:Donald J. West, FHWA DivisionAdministrator, Vermont, or Patrick M.Arno, Environmental Program Manager,P.O. Box 568, Montpelier VT 05601, tel.:(802) 828-4423, or Samuel Lewis,Project Manager, Vermont Agency ofTransportation, tel.: (802) 828-3966.SUPPLEMENTARY INFORMATION: TheFHWA in cooperation with the VermontAgency of Transportation will preparean environmental impact statement(EIS) to evaluate alternatives to providea bypass or upgrading of VermontRoutes 9 and 100 at Wilmington inWindham County, Vermont. Theproposed improvements are considerednecessary to provide for the existing andprojected traffic demand.

Alternatives under considerationinclude (1) taking no action; (2)improvements to the existing Routes 9and 100, including TransportationSystems Management/TransportationDemand Management measures (TSM/TDM); (3) An east-west bypass locatedsouth of the center of Wilmington; (4) Anorth-south bypass located west of thecenter of Wilmington; (5) A north-southbypass located east of the center ofWilmington. Combinations of thesealternatives, and other alternativesdeveloped during the scoping process,will also be evaluated. Incorporated intoand studied with the various buildalternatives will be design variations ofgrade and alignment.

The EIS will evaluate, but not belimited to assessing the environmentalimpacts, including secondary andculumative impacts on the affectedenvironment for the following impactcategories: Socio-economic includingresidential, business, and employment;historical and archaeological; culturalresources; parklands; recreation;aesthetics; traffic; noise; surface waterhydrology and quality; air quality;wetlands; wildlife habitat; fisheries;vegetation; geology; soils; and

groundwater resouices. The EIS willalso evaluate impacts on the affectedenvironment resulting fromconstruction period traffic and inducedeconomic growth associated with theproject.

Letters describing the proposed actionand soliciting comments will be sent toappropriate Federal, State and localagencies, and to private organizationsand citizens who have previouslyexpressed or are known to have interestin this proposal. A scoping meeting willbe held on Monday, January 24, 1994 at7 p.m. at the Wilmington Town Hall. In2 addition, a series of public meetingswill be held during the preparation ofthe EIS, and a public hearing will beheld after the draft EIS is published.Public notice will be given of the timeand place of the meetings and hearing.The draft EIS will be available for publicand agency review and comment priorto the public hearing.

To ensure that the full range of issuesrelated to this proposed action areaddressed and all significant issuesidentified, comments and suggestionsare invited from all interested parties.Comments or questions concerning thisproposed action and the EIS should bedirected to the FHWA at the addressabove.(Catalog of Federal Domestic AssistanceProgram Number 20.205, Highway Planningand Construction. The regulationsimplementing Executive Order 12372regarding intergovernmental consultation onFederal Programs and activities apply to thisprogram)

Issued on: November 29, 1993.William L Fung,Engineering Coordinator, Montpelier,Vermont.[FR Doc. 93-30272 Filed 12-9-93; 8:45 am]BILLNG COD 4910-22-

National Highway Traffic SafetyAdministration[Docket No. 93-7; Notice 1]

Bugatti Automobill, S.p.A.; Receipt ofPetition for Temporary ExemptionFrom Standard No. 208

BWigatti Automobili, S.p.A., ofModena, Italy, has petitioned for atemporary exemption until November 1,1995, from the automatic protectionrequirements of Federal Motor VehicleSafety Standard No. 208, OccupantCrash Protection. The basis of thepetition is that compliance would causesubstantial economic hardship.

Notice of receipt of the petition ispublished in accordance with agencyregulations on the subject (49 CFR part555) and does not represent any

judgment of the agency on the merits ofthe petition.

Petitioner's Hardship ArgumentsUnder 15 U.S.C. 1410(a)(1)(A), the

Administrator may provide a temporaryexemption upon a finding that"compliance would cause substantialeconomic hardship and that themanufacturer has, in good faith,attempted to comply * * *"

The following is a summary ofBugatti's petition. Bugatti was formed asan Italian corporation in 1987 for thepurpose of manufacturing automobiles.It is 80.66% owned by BugattiInternational Holding, S.A., aLuxembourg corporation, whichbetween 1987 and 1994 will haveinvested in excess of $115,000,000 infacilities, personnel, research anddevelopment. Four years after itsfounding, in 1991, Bugatti presented aprototype vehicle to the public. Thefactory was completed in 1992, andproduction of its first model, the EB110, began in April 1993, To date,"fewer than 50 cars have beenproduced." As the company only beganrealizing income with thecommencement of sales earlier this year,its lifetime cumulative net losses nowexceed $30,000,000.

In its early years, the company's focuswas to establish itself and to commencesales in markets other than the UnitedStates. The company's permanentmanagement team was not in place until1991, and its permanent engineeringteam was finalized only in 1993.Initially, it "seriously considered noteven coming to the United States at all"because of "product liability exposureand insurance, homologation costs, andthe often volatile nature of the highperformance/exotic car market in theUnited States." In the Spring of 1993,however, it made the decision to enterthe U.S. market and intends to do so inmid-1994. Because of the requirement inthe Intermodal Surface TransportationAct of 1991 mandating the phase-in ofairbags beginning in September 1996,the company decided not to develop anautomatic belt system but, instead, toprovide an air bag system from thebeginning as a means of complying withStandard No. 208.

Lacking the in-house engineering staffcapable of developing an air bag system,and concurrently with its decision toenter the U.S. market, Bugatti began asearch to locate an "engineering designand development firm to manageBugatti's air bag project." Fourteencompanies were approached, and inSeptember 1993, the proposal by LotusEngineering was accepted. The cost ofthe proposal is "in excess of $1.2

65008


million (not including the cost of thevehicles to be crashed)." The companyanticipates that it will be able tocommence production of air bagequipped vehicles in April 1995, wellbefore the end of the 2-year exemptionit has requested.

Late in August 1993, BugattiInternational Holding, which, aspreviously noted, owns 80.66% of thepetitioner, signed a contract to purchaseGroup Lotus plc, including LotusEngineering. Lotus is also amanufacturer of motor vehicles, whoseproduction in 1992 was 688 units.According to the petitioner, Lotus "lostover $35 million in 1992 on revenues ofapproximately $92 million." Thepurchase of Lotus would be financed bycapital investments into BugattiInternational Holding earmarked for thatspecific purpose.

In the absence of an exemption, thecompany projects continuing net lossesthrough 1994.

Arguments Why an Exemption Wouldbe in the Public Interest and ConsistentWith Traffic Safety Objectives

In order to grant an exemption, theAdministrator must also find that theexemption is in the public interest andconsistent with the objectives of theNational Traffic and Motor VehicleSafety Act. In support of its petition,Bugatti has Informed NHTSA that it"will make every effort possible todesign its air bag system so that it canretrofit with air bags all vehicles soldunder the exemption." It also arguedthat it does not expect to sell more than100 cars under the exemption. Each car,equipped with a three-point belt system,would be labeled with a seat belt usereminder. Further, all vehicles will meetamended Standard No. 214 Side DoorStrength in advance of the requirementto do so, as well as all other Federalmotor vehicle safety standards.

Interested persons are invited tosubmit comments on the petitiondescribed above. Comments should referto the Docket number and be submittedto: Docket Section, National HighwayTraffic Safety Administration, room5109, 400 Seventh St. SW., Washington,DC 20590. It is requested but notrequired that 10 copies be submitted.

All comments received before theclose of business on the commentclosing date indicated below will beconsidered, and will be available forexamination in the docket at the aboveaddress both before and after that date.To the extent possible, comments filedafter the closing-date will also beconsidered. Notice of final action on thepetition will be published in the

Federal Register pursuant to theauthority indicated below.

Comment closing date: January 10,1994.

Authority: 15 U.S.C. 1410; delegations ofauthority at 49 CFR 1.50 and 501.8.

Issued on: December 6.1993.Barry Feirice,Associate Administrator for Rulemaking.IFR Doc. 93-30145 Filed 12-9-93; 8:45 aml

.LJWG CODE 4910-4M

[Docket No. 93-72; Notice 2]

Determination That Nonconforming1977 Bristol VRT Buses Are Eligible forImportation

AGENCY: National Highway TrafficSafety Administration (NHTSA), DOT.ACTION: Notice of determination byNHTSA that nonconforming 1977Bristol VRT buses are eligible forimportation.

SUMMARY: This notice announces thedetermination by NHTSA that 1977Bristol VRT buses that were notoriginally manufactured to comply withall applicable Federal motor vehiclesafety standards are eligible forimportation into the United Statesbecause they have safety features thatcomply with, or are capable of beingmodified to comply with, all suchstandards.DATES: The determination is effective asof December 10, 1993.FOR FUAThER INFORMATION CONTACT:Ted Bayler, Office of Vehicle SafetyCompliance, NHTSA (202-366-5306).


BackgroundUnder section 108(c)(3)(A)(i)(I) of the

National Traffic and Motor VehicleSafety Act (the Act), 15 U.S.C.§ 1397(c)(3)(A)(i){I), a motor vehicle thatwas not originally manufactured toconform to all applicable Federal motorvehicle safety standards shall be refusedadmission into the United States on andafter Januty 31, 1990, unless NHTSAhas determined that the motor vehicle issubstantially similar to a motor vehicleoriginally manufactured for importationinto and sale in the United States,certified under section 114 of the Act,and of the same model year as themodel of the motor vehicle to becompared, and Is capable of beingreadily modified to conform to allapplicable Federal motor vehicle safetystandards. Where there is nosubstantially similar U.S. certifiedmotor vehicle, section 108(c)(3)(A)(i)(II)of the Act, 15 U.S.C. 1397(c)(3)(A)(i)(II),permits a nonconforming motor vehicle

to be admitted into the United States ifits safety features comply with, or arecapable of being modified to complywith; all applicable Federal motorvehicle safety standards based ondestructive test data or such otherevidence as NHTSA determines to beadequate.

Petitions for eligibility determinationsmay be submitted by eithermanufacturers or importers who haveregistered with NHTSA pursuant to 49CFR part 592. As specified in 49 CFR593.7, NHTSA publishes notice in theFederal Register of each petition that itreceives, and affords interested personsan opportunity to comment on thepetition. At the close of the commentperiod, NHTSA determines, on the basisof the petition and any comments thatit has received, whether the vehicle iseligible for importation. The agencythen publishes this determination in theFederal Register.

Double Decker Bus Company ofDenver, Colorado (Registered ImporterR-93-015) petitioned NHTSA todetermine whether 1977 Bristol VRTbuses are eligible for importation intothe United States. NHTSA publishednotice of the petition on September 30,1993 (58 FR 51125) to afford anopportunity for public comment. Asdescribed in that notice, the petitionerclaimed that the 1977 Bristol VRT bushas safety features that comply withStandard Nos. 102 Transmission ShiftLever Sequence * * * (based onschematic diagram indicating starterinterlock protection and photographshowing shift lever positions), 103Defrosting and Defogging Systems(based on statement and photographindicating that system incorporateselectrically heated elements and heatedair blowers), 104 Windshield Wipingand Washing Systems (based onstatement and photographs Indicatingthat system is pneumatically driven andoffers full coverage of windshield at twoset speeds and intermittently), 107Reflecting Surfaces (based on statementand photographs indicating thatreflective glare is kept to a minimum inthe driver's cab through the use of mattblack paint on the windshield wipers,the rearview mirror frame, the dash, andthe cab walls), 120 Tire Selection andRims for Motor Vehicles other thanPassenger Cars (based on statement andphotographs showing certificationmarkings on tires supplied by vehiclepurchaser and rims selected by -petitioner, and describing contents oftire information placard), 121 Air BrakeSystems (based on statement,photographs, and specificationsindicating that vehicle is equipped withan air compressor and associated

65009


equipment that provides greater cut-inpressure than 85 p.s.i.), 124 AcceleratorControl Systems (based on statementand photographs indicating that throttlereturn is provided by pneumatic valve,supplemented by a spring loaded footpedal), 205 Glazing Materials (based onstatement and photographs showing thatglazing materials bear DOT certificationmarkings), 207 Seating Systems (basedon statement and photographsindicating that seats are securelymounted to the vehicle's floor), 217 BusWindow Retention and Release (basedon statement describing windowretention test results and calculationsindicating size and distribution ofemergency exits), and 302 Flammabilityof Interior Materials (based onstatements and photographs indicatingcomposition of upholstery, and testresults).

The petitioner also contended that the1977 Bristol VRT bus is capable of beingmodified to comply with the followingstandards, in the manner indicated:

Standard No. 101 Controls andDisplays: (a) Installation of apotentiometer wired in series to providevariation in panel lighting; (b)installation of dash-mounted high beamtelltale; (c) installation of U.S.-modellicense plate lamp.

Standard No. 106 Brake Hoses:Replacement of flexible brake hoses onfront wheels with U.S.-model parts.

Standard No. 108 Lamps, ReflectiveDevices, and Associated Equipment:installation of the following equipmentbearing DOT certification markings: (a)Two sealed beam headlamps, threeamber identification lamp clusters, twoamber clearance lamps, and two amberlength and height markers at the frontend of the vehicle; (b) three redidentification lamp clusters, two redclearance lamps, two red length andheight markers, two red side marker/reflectors, and one license plateillumination lamp at the rear end of thevehicle; (c) two amber reflectors at themidsection of the vehicle's right side;(d) two amber reflectors at themidsection of the vehicle's left side.

Standard No. 111 Rearview Mirrors:Replacement of the rearview mirrorswith U.S.-model parts.

Standard No. 125 Warning Devices:Procurement of three U.S.-modelreflective warning triangles to be carriedon vehicle.

Standard No. 208 Occupant CrashProtection: Installation of a Type 2 seatbelt at the driver's position.

Standard No. 209 Seat BeltAssemblies: Installation of a U.S.-modelType 2 seat belt at the driver's position.

Standard No. 210 Seat Belt AssemblyAnchorages: Use of 16-20UNF-2A

hardened bolts, flat washers, lockwashers, and nuts as anchoragehardware.

No comments were received inresponse to the notice of the petition.Based on its review of the informationsubmitted by the petitioner, NHTSA hasdetermined to grant the petition.

Vehicle Eligibility Number for SubjectVehicles

The importer of a vehicle admissibleunder any final determination mustindicate on the form HS-7accompanying entry the appropriatevehicle eligibility number indicatingthat the vehicle is eligible for entry. VCP4 is the vehicle eligibility numberassigned to vehicles admissible underthis determination.

Final DeterminationAccordingly, on the basis of the

foregoing, NHTSA hereby determinesthat 1977 Bristol VRT buses are eligiblefor importation into the United Statesbecause they have safety features thatcomply with, or are capable of beingmodified to comply with, all applicableFederal motor vehicle safety standards.

Authority: 15 U.S.C. 1397(c)(3)(A)(i)([I)and (C)(iii); 49 CFR 593.8; delegations ofauthority at 49 CFR 1.50 and 501.8.

Issued on: December 6, 1993.William A. Boehly,Associate Administrator for Enforcement.IFR Dec. 93-30147 Filed 12-9-93; 8:45 am)BILWNG CODE 491049-U

[Docket No. 93-66; NoUce 2]

Determination that Nonconforming1990 Mercedes-Benz 420SELPassenger Cars are Eligible forImportation

AGENCY: National Highway TrafficSafety Administration (NHTSA), DOT.ACTION: Notice of determination byNHTSA that nonconforming 1990Mercedes-Benz 420SEL passenger carsare eligible for importation.

SUMMARY: This notice announces thedetermination by NHTSA that 1990Mercedes-Benz 420SEL passenger carsnot originally manufactured to complywith all applicable Federal motorvehicle safety standards are eligible forimportation into the United Statesbecause they are substantially similar toa vehicle originally manufactured forimportation into and sale in the UnitedStates and certified by its manufactureras complying with the safety standards(the U.S.-certified version of the 1990Mercedes-Benz 420SEL), and they arecapable of being readily modified toconform to the standards.

DATES: The determination is effective asof the date of its publication in theFederal Register.FOR FURTHER INFORMATION CONTACT:Ted Bayler, Office of Vehicle SafetyCompliance, NHTSA (202-366-5306).


BackgroundUnder section 108(c)(3)(A)(i) of the

National Traffic and Motor VehicleSafety Act (the Act), 15 U.S.C.1397(c)(3)(A)(i), a motor vehicle thatwas not originally manufactured toconform to all applicable Federal motorvehicle safety standards must be refusedadmission into the United States on andafter January 31, 1990, unless NHTSAhas determined that the motor vehicle issubstantially similar to a motor vehicleoriginally manufactured for importationinto and sale in the United States,certified under section 114 of the Act,and of the same model of the motorvehicle to be compared, and is capableof being readily modified to conform toall applicable Federal motor vehiclesafety standards.


Champagne Imports, Inc. of Lansdale,Pennsylvania (Registered Importer R-90-009) petitioned NHTSA to determinewhether 1990 Mercedes-Benz 420SEL(Model ID 126.035) passenger cares areeligible for importation into the UnitedStates. NHTSA published notice of thepetition on September 14, 1993 (58 FR48086) to afford an opportunity forpublic comment. The reader is referredto that notice for a thorough descriptionof the petition. No comments werereceived in response to the notice.Based on its review of the informationsubmitted by the petitioner, NHTSA hasdetermined to grant the petition.


The importer of a vehicle admissibleunder any final determination mustindicate on the form HS-7accompanying entry the appropriatevehicle eligibility number indicating

65010-


that the vehicle is eligible for entry. VSP48 is the vehicle eligibility numberassigned to vehicles admissible underthis determination.

Final Determination

Accordingly, on the basis of theforegoing, NHTSA hereby determinesthat a 1990 Mercedes-Benz 420SEL(Model ID 126.035) not originallymanufactured to comply with allapplicable Federal motor vehicle safetystandards is substantially similar to a1990 Mercedes-Benz 420SEL originallymanufactured for importation into andsale in the United States and certifiedunder section 114 of the National Trafficand Motor Vehicle Safety Act, and iscapable of being readily modified toconform to all applicable Federal motorvehicle safety standards.

Authority: 15 U.S.C. 1397(c)(3) (A)(i)(I) and(Cii); 49 CFR 593.8; delegations of authorityat 49 CFR 1.50 and 501.8.

Issued on: December 6, 1993.William A. Boehly,Associate Administrator for Enforcement.[FR Doc. 93-30146 Filed 12-9-93; 8:45 am)BILMIG CODE 4910-W.

[Docket No. 93-70; Notice 2]

Determination that Nonconforming1988 Acura Legend Passenger Carsare Eligible for Importation

AGENCY: National Highway TrafficSafety Administration (NHTSA), DOT.

ACTION: Notice of determination byNHTSA that nonconforming 1988 AcuraLegend passenger cars are eligible forimportation.

SUMMARY: This notice announces thedetermination by NHTSA that 1988Acura Legend passenger cars notoriginally manufactured to comply withall applicable Federal motor vehiclesafety standards are eligible forimportation into the United Statesbecause they are substantially similar toa vehicle originally manufactured forimportation into and sale in the UnitedStates and certified by its manufactureras complying with the safety standards(the U.S.-certified version of the 1988Acura Legend), and they are capable ofbeing readily modified to conform to thestandards.

DATES: The determination is effective asof the date of its publication in theFederal Register.

FOR FURTHER INFORMATION CONTACT:

Ted Bayler. Office of Vehicle SafetyCompliance, NHTSA (202-366-5306).


Background

Under section 108(c)(3)(A)(i) of theNational Traffic and Motor VehicleSafety Act (the Act), 15 U.S.C.1397(c)(3)(A)(i), a motor vehicle thatwas not originally manufactured toconform to all applicable Federal motorvehicle safety standards must be refusedadmission into the United States on andafter January 31, 1990, unless NHTSAhas determined that the motor vehicle issubstantially similar to a motor vehicleoriginally manufactured for importationinto and sale in the United States,certified under section 114 of the Act,and of the same model year as themodel of the motor vehicle to becompared, and is capable of beingreadily modified to conform to allapplicable Federal motor vehicle safetystandards.


Champagne Imports, Inc. of Lansdale,Pennsylvania (Registered Importer R-90-009) petitioned NHTSA to determinewhether 1988 Acura Legend passengercars are eligible for importation into theUnited States. NHTSA published noticeof the petition on September 23, 1993(58 FR 49542) to afford an opportunityfor public comment. The reader isreferred to that notice for a thoroughdescription of the petition. Nocomments were received in response tothe notice. Based on its review of theinformation submitted by the petitioner,NHTSA has determined to grant thepetition..


The importer of a vehicle admissibleunder any final determination mustindicate on the form HS-7accompanying entry the appropriatevehicle eligibility number indicatingthat the vehicle is eligible for entry. VSP51 is the vehicle eligibility numberassigned to vehicles admissible underthis determination.

Final Determination

Accordingly, on the basis of theforegoing, NHTSA hereby determinesthat a 1988 Acura Legend not originallymanufactured to comply with allapplicable Federal motor vehicle safetystandards is substantially similar to a1988 Acura Legend originallymanufactured for importation into andsale in the United States and certifiedunder section 114 of the National Trafficand Motor Vehicle Safety Act, and iscapable of being readily modified toconform to all applicable Federal motorvehicle safety standards.

Authority: 15 U.S.C. 1397(c)(3) (A)(i)(1) and(C)ii); 49 CFR 593.8; delegations of authorityat 49 CFR 1.50 and 501.8.

Issued on: December 3, 1993.William A. Boehly,Associate Administrator for Enforcement.[FR Doc. 93-30144 Filed 12-9-93; 8:45 am]BILLNG CODE 4910-6"

Research and Special ProgramsAdministration

Pipeline Safety Advisory Bulletin ADB-93-05 Drug Testing Information

AGENCY: Research and Special ProgramsAdministration (RSPA), DOT.

ACTION: Drug testing information forpipeline operators and contractors.

SUMMARY: The information providedherein is meant to assist pipelineoperators and contractors in evaluatingtheir anti.-drug plans for compliancewith 49 CFR parts 199 and 40.

Advisory

When anti-drug plans are reviewed orevaluated omissions or inadequaciesshould be remedied as needed, withparticular attention to the followingsections of the regulations and the"Failures" noted:

* § 199.7 Failure to clearly delineatebetween DOT anti-drug testingrequirements and company mandatedtesting requirements that are containedin a single document.

* § 199.7 Failure to comply withpart 40 requirements in anti-drug plan.

* § 199.11 Failure to identifyprocedures or provide recorddocumentation on various types of drugtesting.

& § 199.17 Failure to document orprovide procedures for retention ofsamples and retesting provisions.

* §199.19 Failure to providenecessary requirements for EmployeeAssistance Programs (EAP) andemployee/supervisor training.

I I I I

65011

Federal Register / Vol. 58, No. 236 ! Friday, December 10, 1993 / Notices

9 § 199.21 Failure to adequately"monitor" -contractor compliance withregard to parts 199 and 40.

e § 40.25 Failure to provideadequate collection procedures in theanti-drug plan.

* § 40.31 Failure to conduct andprocess blind performance testingsamples.

a § 40.33 Failure to provideadequate medical review officerprocedures in the anti-drug plan.

The following are two other areas foroperators and contractors to review/evaluate to help make sure their anti-drug plans are fully in compliance:

* § 199.11(e) Return-to-dutyTesting-This concerns the schedulingof unannounced testing for employeeswho have tested positive and arereturned to duty to perform coveredfunctions. Several operator anti-drugplans had defined specificunannounced testing schedules;however, further evaluation of thetesting records failed to indicate that thetesting schedules for these employeeswere carried out by the operator and theMedical Review Officer (MRO).§ 199.11(e) stipulates that "An employeewho returns to duty shall be subject toa reasonable program of follow-up -testing without prior notice for not morethan 60 months after his/her return toduty." The MRO guide published byDOT indicates the MRO may make areturn-to-duty recommendation ifsatisfied that an individual meets therequirements. Following therecommendation, the MRO must alsoestablish an unannounced drug testingprogram for the individual. Such testingmay be in effect for up to 60 months.The frequency of unannounced testingshould be determined by the MRObased on the assessment andrecommendation of the counselor andthe employer.

* §40.31(d) Employer BlindPerformance Test Procedures-Thisconcerns the lack of documentation andsubmission of the appropriate numberof blind samples as set forth in theEmployer Blind Performance TestProcedures under § 40.3 1(d). A recentanalysis indicated that a large portion ofpipeline operators who have beenaudited had failed to either (1) providedocumentation to substantiatecompliance with the provisions, or (2)submit the required number of blindsamples based on the total number ofemployee tests submitted to eachNational Institute of Drug Abuse (NIDA)laboratory. Many operators arepurchasing and submitting "spiked"blind samples even though they are notmandated under the current regulations.Operators are required to submit

"spiked" blind samples when theiremployee total is greater than 2,000covered employees. Each operator isrequired to submit three blindperformance test specimens for each 100employee specimens it submits, up to amaximum of 100 blind performance testspecimens submitted per quarter to eachNIDA laboratory being utilized by theoperator.

Background

Office of Pipeline Safety (OPS)Regional Offices and the various statepipeline safety program agencies haveconducted numerous drug inspectionsof pipeline operators since drug testingwas started in April/August 1990. Arecent OPS review of enforcementactions from those inspections revealedsome areas where probable violationsare commonly found. These are listedand briefly described in the foregoingsection ("Advisory") to help ensureoperator compliance with parts 199 and40.George W. Tenley, Jr.,Associate Administrator for Pipeline Safety.[FR Doc. 93-30256 Filed 12-4-93; 8:45 amlBILLING CODE 4910-0.-M

UNITED STATES INFORMATIONAGENCY

International Educational and CulturalActivities Discretionary Grant Program

AGENCY: United States InformationAgency.ACTION: Notice-request for proposals.

SUMMARY: The Office of CitizenExchanges (E/P) announces adiscretionary grants program for private,non-profit organizations in support ofprojects that link their internationalexchange interests with counterpartinstitutions/groups in ways supportiveof the aims of the Bureau of Educationaland Cultural Affairs. Interestedapplicants are urged to read thecomplete Federal Registerannouncement before addressinginquiries to the Office or submittingtheir proposals. After the deadline forsubmitting proposals, USIA officers maynot discuss this competition in any waywith applicants until final decisions aremade.ANNOUNCEMENT NUMBER: Allcommunications concerning thisannouncement should refer to theSpring Discretionary Grant Program.The announcement number is E/P-94-14. Please refer to title and number inall correspondence or telephone calls toUSIA.

DATES: Deadline for Proposals: All'copies must be received at the U.S.Information Agency by 5 p.m.Washington, DC time on Friday,February 25, 1994. Faxed documentswill not be accepted, nor willdocuments postmarked on February 25,1994, but received at a later date. It isthe responsibility of each grantapplicant to ensure that proposals arereceived by the above deadline. Thisaction is effective from the publicationdate of this notice through February 25,1994, for projects whose activities willbegin between July 1, 1994, andDecember 31, 1994.ADDRESSES: The original and 14 copiesof the completed application, includingrequired forms, should be submitted bythe deadline to: U.S. InformationAgency, REF: E/P Discretionary GrantCompetition, Grants ManagementDivision (E/XE), 301 4th Street, SW.,room 336, Washington, DC 20547.FOR FURTHER INFORMATION CONTACT:Interested organizations/institutionsmust contact the Office of CitizenExchanges, Bureau of Educational andCultural Affairs, United StatesInformation Agency, 301 4th Street,SW., Washington, DC 20547, (202) 619-5326, to request detailed applicationpackets, which include award criteria,all necessary forms, and guidelines forpreparing proposals, including specificbudget preparation information.SUPPLEMENTARY INFORMATION: The Officeof Citizen Exchanges of the UnitedStates Information Agency announces aprogram to encourage, through limitedawards to non-profit institutions,increased private sector commitment toand involvement in internationalexchanges. Awarding of any and allgrants is contingent upon theavailability of funds.

The Office of Citizen Exchangesworks with U.S. private sector non-profit organizations on cooperativeinternational group projects thatintroduce American and foreignparticipants to each others' social.economic, and political structures; andinternational interests. The Officesupports international projects in theUnited States or overseas involvingleaders or potential leaders in thefollowing fields and professions: Urbanplanners, jurists, specialized journalists(specialists in economics, business,political analysis, international affairs),business professionals, environmentalspecialists, parliamentarians, educators,economic planning and othergovernment officials.

Applicants should carefully note thefollowing restrictions/recommendations

65012


for proposals in specific geographicalareas:

The Newly Independent StatesUSIA and other agencies of the U.S.

government have numerous programs inthe countries of the NIS (Armenia,Azerbaijan, Belarus, Georgia,Kazakhstan, Kyrgyzstan, Moldova,Russia, Tajikistan, Turkmenistan,Ukraine, and Uzbekistan). As such, theamount of funds for that part of theworld in this competition will beextremely limited. Proposals whichwould normally be considered for otherUSIA grant competitions will not beaccepted. E/P encourages organizationsto seek clarification on these pointsbefore presenting a proposal.

Europe, Eastern Europe, and the Baltics(EU)

Projects are encouraged involvingWestern Europe. Due to the fact that theoffice has or is in the process ofconducting specific competitions inEastern Europe and the Baltics, we willnot accept proposals for youth exchangeprograms or for programs in thefollowing thematic areas: publicadministration, business management,independent media development,journalism training, and localgovernment administration andmunicipal management.

East Asia and the Pacific (EA)Priority consideration will be given to

the following: (1) Projects for journalists(print or electronic). Priorities areprojects for Korea, joint projects forHong Kong and Singapore, or regionalprojects focused on Southeast Asia. Theprojects may consist of but are notlimited to in-country workshops, sitetours, seminars and discussions, andinternships. Internships are to bepractical work experiences rather thanpassive job shadowing. An internshipshould be at least three weeks,including orientation activities. (2)Projects concerned with thestrengthening of democracy orenvironmental issues. Priority will begiven to regional projects or singlecountry projects that focus onCambodia, Mongolia, Philippines, andThailand.

American Republics (AR)Priority will be given to projects in

the following areas: good governance.anti-corruption, public administration,decentralization-state and localgovernment.

Africa (AF)Proposals on strengthening

democracy are encouraged.

North Africa, Near East and South Asia(NEA)

Priority will be given to projectswhich promote democratization,economic reform, free markets,tolerance and pluralism, and conflictresolution.

The Office of Citizen Exchangesstrongly encourages the coordination ofactivities with respected universities,professional associations, and majorcultural institutions in the U.S. andabroad, but particularly in the U.S.Projects should be intellectual andcultural, not technical. Vocational.training (an occupation other than onerequiring a baccalaureate or higheracademic degree; i.e., clerical work, automaintenance, etc. and other occupationsrequiring less than two years of highereducation) and technical training(special and practical knowledge of amechanical or a scientific subject whichenhances mechanical, narrowlyscientific, or semi-skilled capabilities)are ineligible for support. In addition,scholarship programs are ineligible forsupport. Pursuant to the Bureau'sauthorizing legislation, programs mustmaintain a non-political character,should be balanced and representativeof the diversity of American political,social and cultural life.

The Office does not support proposalslimited to conferences or seminars (i.e.,one to fourteen-day programs withplenary sessions, main speakers, panels,and a passive audience). It will supportconferences only insofar as they are partof a larger project in duration and scopewhich is receiving USIA funding fromthis competition. USIA-supportedprojects may include internships; studytours; short-term, non-technicaltraining; and extended, intensiveworkshops taking place in the UnitedStates or overseas.

The themes addressed in exchangeprograms must be of long-termimportance rather than focusedexclusively on current events or short-term issues. In every case, a substantialrationale must be presented as part ofthe proposal, one that clearly indicatesthe distinctive and importantcontribution of the overall project,including where applicable theexpected yield of any associatedconference.

No funding is available exclusively tosend U.S. citizens to conferences orconference-type seminars overseas;neither is funding available for bringingforeign nationals to conferences or toroutine professional associationmeetings in the United States.

Projects that duplicate what isroutinely carried out by private sector

and/or public sector operations will notbe considered. USIS post consultationby applicants, prior to submission ofproposals, is strongly recommended forall programs.

Additional Guidelines and Restrictions

Office of Citizen Exchanges grants arenot given to support projects whosefocus is limited to technical orvocational subjects, or for researchprojects, for publications funding, forstudent and/or teacher/facultyexchanges, for sports and/or sportsrelated programs. Nor does this officeprovide scholarships or support forlong-term (a semester or more) academicstudies. Competitions sponsored byother Bureau offices are also announcedin the Federal Register.

For projects that would begin afterDecember 31, 1994, competition detailswill be announced in the FederalRegister on or about June 1, 1994.Inquiries concerning technicalrequirements are welcome prior tosubmission of applications.

Selection of Participants

All grant proposals should clearlydescribe the type of persons who willparticipate in the program as well as theprocess by which participants will beselected. It is recommended thatprograms in support of U.S. internshipsinclude letters tentatively committinghost institutions to support theinternships.

In the selection of foreignparticipants, USIA and USIS postsretain the right to nominate allparticipants and to accept or denyparticipants recommended by granteeinstitutions. However, granteeinstitutions will often provide support,as requested by USIA, in the nominationof participants. The grantee institutionwill also provide the names of Americanparticipants and brief biographical datato the Office of Citizen Exchanges forinformation purposes. Priority will begiven to foreign participants who havenot previously travelled to the UnitedStates.

Funding

Althugh no set funding limit exists,proposals for less than $150,000 willreceive preference. Organizations withless than four years of successfulexperience in managing internationalexchange programs are limited to$60,000.

Applicants are invited to provide bothan all-inclusive budget as well asseparate sub-budgets for each programcomponent, phase, location, or activityin order to facilitate USIA decisions onfunding. While an all-inclusive budget

65013


must be provided with each proposal,separate component budgets areoptional. Competition for USIA fundingsupport is keen.

The selection of grantee institutionswill depend on program substance,'cross-cultural sensitivity, and ability tocarry out the program successfully.Since USIA grant assistance constitutesonly a portion of total project funding,proposals should list and provideevidence of other anticipated sources offinancial and in-kind support. TheRecipient must provide a minimum of33 percent cost sharing of the totalproject cost. Cost sharing may be in theform of allowable direct of indirectcosts. The Recipient must maintainwritten records to support all allowablecosts which are claimed as being itscontribution to cost participation, aswell as costs to be paid by the Federalgovernment. Such records are subject toaudit. The basis for determining thevalue of cash and in-kind contributionsmust be in accordance with OMBCircular A-110, Attachment E--CostSharing and Matching and should bedescribed in the proposal. In the eventthe Recipient does not provide aminimum of 33 percent cost sharing, theAgency's contribution will be reducedin proportion to the Recipient'scontribution. Proposals with costsharing of less than 33 percent of thetotal project cost will be consideredineligible.

The recipient's proposal shall includethe cost of an audit that: (1) Complieswith the requirements of OMB CircularNo. A-133, Audits of Institutions ofHigher Education and Other NonprofitInstitutions; (2) complies with therequirements of American Institute ofCertified Public Accountants (AICPA)Statement of Position (SOP) No. 92-9;and (3) includes review by therecipient's independent auditor of arecipient-prepared supplementalschedule of indirect cost ratecomputation, if such a rate is beingproposed.

The audit costs shall be identifiedseparately for: (1) Preparation of basicfinancial statements and otheraccounting services; and (2) preparationof the supplemental reports andschedules required by OMB Circular No.A-133, AICPA SOP 92-9, and thereview of the supplemental schedule ofindirect cost rate computation.

The following project costs areeligible for consideration for funding:

1. International and domestic airfares; visas; transit costs; groundtransportation costs.

2. Per Diem. For the U.S. program,organizations have the option of using aflat $140/day for program participants

or the published U.S. Federal per diemrates for individual American cities. Foractivities outside the U.S., the publishedFederal per diem rates must be used.NOTE: U.S. escorting staff must use thepublished Federal per diem rates, notthe flat rate.

3. Interpreters: If needed, interpretersfor the U.S. program are provided by theU.S. State Department LanguageServices Division. Typically, a pair ofsimultaneous interpreters is providedfor every four visitors who needinterpretation. USIA grants do not payfor foreign interpreters to accompanydelegations from their home country.Grant proposal budgets should containa flat $140/day per diem for eachDepartment of State interpreter, as wellas home-program-home airtransportation of $400 per interpreterplus any U.S. travel expenses during theprogram. Salary expenses are coveredcentrally and should not be part of ananplicant's proposed budget.

4. Book and cultural allowance:Participants are entitled to and escortsare reimbursed a one-time culturalallowance of $150 per person, plus aparticipant book allowance of $50. U.S.staff do not get these benefits.

5. Consultants. May be used toprovide specialized expertise or to makepresentations. Daily honoraria generallydo not exceed $250 per day.Subcontracting organizations may alsobe used, in which case the writtenagreement between the prospectivegrantee and subcontractor should beincluded in the proposal.

6. Room rental, which generallyshould not exceed $250 per day.

7. Materials development. Proposalsmay contain costs to purchase, develop,and translate materials for participants.

8. One working meal per project. Percapita costs may not exceed $5-8 for alunch and $14-20 for a dinner;excluding room rental. The number ofinvited guests may not exceedparticipants by more than a factor of twoto one.

9. A return travel allowance of $70 foreach participant which is to be used forincidental expenditures incurred duringinternational travel.

10. All USIA-funded delegates will becovered under the terms of a USIA-sponsored health insurance policy. Thepremium is paid by USIA directly to theinsurance company.

11. Other costs necessary for theeffective administration of the program,including salaries for grant organizationemployees, benefits, and other directand indirect costs per detailedinstructions in the application package.Note: the 20 percent limitation of"administrative costs" included in

previous announcements does not applyto this RFP.

Application RequirementsProposals must be structured as

outlined in the application package.Confirmation letters from American andforeign co-sponsors noting theirintention to participate in the programwill enhance an institution'ssubmission.

Review ProcessUSIA will acknowledge receipt of all

proposals and will reiew them fortechnical eligibility. Proposals will bedeemed ineligible if they do not fullyadhere to the guidelines establishedherein and in the application packet.Eligible proposals will be forwarded topanels of USIA officers for advisoryreview. All eligible proposals will alsobe reviewed by the appropriategeographic area office, and the budgetand contract offices. Proposals may alsobe reviewed by the USIA's Office ofGeneral Counsel.

Funding decisions are at thediscretion of the Associate Director forEducational and Cultural Affairs. Finaltechnical authority for grant awardsresides with USIA's contracting officer.The award of any grant is subject to theavailability of funds.

The U.S. Government reserves theright to reject any or all applicationsreceived. USIA will not pay for designand development costs associated withsubmitting a proposal. Applications aresubmitted at the risk of the applicant;should circumstances prevent award ofa grant, all preparation and submissioncosts are at the applicant's expense.USIA will not award funds for activitiesconducted prior to the actual grantaward.

Review CriteriaUSIA will consider proposals based

on their conformance with theobjectives and considerations alreadystated in this RFP, as well as thefollowing criteria:

1. Quality of Program Idea: Proposalsshould exhibit originality andsubstance. Their rationale shouldpersuade the reader that the U.S.taxpayer's dollar is being well-spent fora clearly defined need.

2. Institution Reputation/Ability:Institutions should demonstrate theirpotential for program excellence and/orprovide documentation of successfulprograms. If an organization is aprevious USIA grant recipient,responsible fiscal management and fullcompliance with all reportingrequirements for past USIA grants asdetermined by USIA's Office of

65014


Contracts (M/KG) will be considered.Relevant program evaluation of previousprojects may also be considered in thisassessment.

3. Project Personnel: Personnel'sprofessional and logistical expertiseshould be relevant to the proposedprogram. Resumes should be relevant tothe specific proposal.

4. Program Planning: Detailed agendaand work plan should demonstratesubstance and logistical capacity.

5. Thematic Expertise: Proposalshould demonstrate the organization'sexpertise in the subject rea.

6. Cross-Cultural SensitiviWAreoExpertise: Evidence of sensitivity tohistorical, linguistic, and other cross-cultural factors; relevant knowledge ofgeographic area.

7. Ability to Achieve ProgramObjectives: Objectives should berealistic and attainable. Proposal shouldclearly demonstrate how the granteeinstitution will meet the programobjectives.

8. Multiplier Effect: Proposedprograms should strengthen long-termmutual understanding, to includemaximum sharing of information andestablishment of long-term institutionalties.

9. Cost-Effectiveness: Overhead andadministrative costs should be kept aslow as possible. All other itemsproposed for USIA funding should benecessary and appropriate to achievethe program's objectives.

10. Cost-Sharing: Proposals shouldmaximize cost-sharing through otherprivate sector support as well as direct

funding contributions and/or in-kindsupport from the prospective granteeinstitution.

11. Follow-on Activities: Proposalsshould provide a plan for continuedexchange activity (without USIAsupport) which ensures that USIA-funded programs are not one-timeevents.

12. Project Evaluation: Proposalsshould include a plan to evaluate theactivity's success. In this respect theapplicant should include a draft surveyquestionnaire or other technique and amethodology to use to link outcomes tooriginal project objectives. Applicantswill be expected to submit intermediatereports after each project component isconcluded or quarterly, whichever isless frequent.

Additional Guidance

The Office of Citizen Exchanges offersthe following additional guidance toprospective applicants:

1. The Office of Citizen Exchangesencourages project proposals involvingmore than one country. Pertinentrationale which links countries in multi-country projects should be included inthe submission. Single-country projectsthat are clearly defined and possess thepotential for creating and strengtheningcontinuing linkages between foreign andU.S. institutions are also welcome.

2. Proposals for bilateral programs aresubject to review and comment by theUSIS post in the relevant country, andpre-selected participants will also besubject to USIS post review.

3. Bilateral programs should dearlyidentify the counterpart organizatio,and provide evidence of theorganization's participation.

4. The Office of Citizen Exchangeswill consider proposals for activitieswhich take place exclusively in othercountries when USIS posts areconsulted in the design of the proposedprogram and in the choice of the mostsuitable venues for such programs.

Notice

The terms and conditions publishedin the RFP are binding and may not bemodified by any USIA representative.Explanatory Information provided byUSIA that contradicts publishedlanguage will not be binding. Issuanceof the RFP does not constitute an awardcommitment on the part of the U.S.Government. Awards cannot be madeuntil funds have been fully appropriatedby the U.S. Congress and allocated andcommitted through internal USIAprocedures.

Notification

All applicants will be notified of theresults of the review process on or aboutJune 1. 1994. Awarded grants will besubject to periodic reporting andevaluation requirements.

Dated. December 7, 1993.Bany Fulton,Acting Associate Director, Bureau ofRductitional and Cultural Affairs.[FR Dec. 93-30247 Filed 12-9-93; 8:45 amlfML5NG 00 02304-U

65015

65016

Sunshine Act Meetings Federal Register

Vol. 58, No. 236


This section of the FEDERAL REGISTERcontains notices of meetings published underthe "Government In the Sunshine Act" (Pub.L. 94-409) 5 U.S.C. 552b(e)(3).

BOARD OF GOVERNORS OF THE FEDERALRESERVE SYSTEM.TIME AND DATE: 10 a.m., Wednesday,December 15, 1993.PLACE: Marriner S. Eccles FederalReserve Board Building, C Street.entrance between 20th and 21st Streets,NW., Washington, DC 20551.

STATUS: Open.

MATTERS TO BE CONSIDERED:

Summary Agenda:

Because of its routine nature, nosubstantive discussion of the followingitem is anticipated. This matter will bevoted on without discussion unless amember of the Board requests that theitem be moved to the discussion agenda.

1. Cost of Federal Reserve notes in 1994.

Discussion Agenda:

2. Proposed amendments to Regulation Ato implement Section 142 of the FederalDeposit Insurance Corporation ImprovementAct of 1991 regarding limits on discount

window advances. (Proposed earlier forpublic comment; Docket No. R-0808)

3. Proposed 1994 Federal Reserve Bankbudgets.

4. Any items carried forward from apreviously announced meeting.

Note: This meeting will be recorded for thebenefit of those unable to attend. Cassetteswill be available for listening in the.Board'sFreedom of Information Office, and copiesmay be ordered for $5 per cassette by calling(202) 452-3684 or by writing to: Freedom ofInformation Office, Board of Governors of theFederal Reserve System, Washington, DC20551.

CONTACT PERSON FOR MORE INFORMATION:Mr. Joseph R. Coyne, Assistant to theBoard; (202) 452-3204.

Dated: December 8, 1993.Jennifer J. Johnson,Associate Secretary of the Board.[FR Doc. 93-30362 Filed 12-8-93; 12:35 am]BILUNG CODE 6210-01-P

BOARD OF GOVERNORS OF THE FEDERALRESERVE SYSTEMTIME AND DATE: Approximately 12 noon,Wednesday, December 15, 1993,following a recess at the conclusion ofthe open meeting.

PLACE: Marriner S. Eccles FederalReserve Board Building, C Streetentrance between 20th and 21st Streets,NW., Washington, DC 20551.STATUS: Closed.

MATTERS TO BE CONSIDERED:

1. Federal Reserve Bank and Branchdirector appointments.

2. Personnel actions (appointments,promotions, assignments, reassignments, andsalary actions) involving individual FederalReserve System employees.

3. Any items carried forward from apreviously announced meeting.

CONTACT PERSON FOR MORE INFORMATION:Mr. Joseph R. Coyne, Assistant to theBoard; (202) 452-3204. You may call(202) 452-3207, beginning atapproximately 5 p.m. two business daysbefore this meeting, for a recordedannouncement of bank and bankholding company applicationsscheduled for the meeting.

Dated: December 8, 1993Jennifer J. Johnson,Associate Secretary of the Board.[FR Doc. 93-30363 Filed 12-8-93; 12:35 pm]BILUNG CODE 6210-01-P

FridayDecember 10. 1993

S

Part H

EnvironmentalProtection Agency40 CFR Part 82

Protection of Stratospheric Ozone; FinalRule

6.0


ENVIRONMENTAL PROTECTIONAGENCY

40 CFR Part 82[FRL-4810-7]

Protection of Stratospheric Ozone

AGENCY: Environmental ProtectionAgency (EPA).ACTION: Notice of final rulemaking.

SUMMARY: With this action, EPA isamending the schedule for the phaseoutof ozone-depleting chemicals that isspecified in section 604 of the Clean AirAct, as amended in 1990 (the Act). Thisaction responds to several petitions andcomments submitted by environmentalorganizations and industry groupsseeking an accelerated phaseout ofozone-depleting substances, as *authorized under section 606 of the Act.Today's action also establishesregulations implementing theamendments, adjustments and decisionsadopted by the Parties to the MontrealProtocol on Substances that Deplete theOzone Layer at their November 1992meeting. In this action, EPA addsmethyl bromide to the list of class Isubstances, in response to new scientificinformation, a petition submitted undersection 602 of the Act, and the decisionof the Protocol Parties to classify methylbromide as a controlled substance withan ozone-depleting potential (ODP) of0.7. EPA is also addinghydrobromofluorocarbons (HBFCs) tothe list of class I substances. In addition,in accordance with trade provisions inArticle 4 of the Montreal Protocol, EPAis banning specified trade between theU.S. and foreign-states not party to, norcomplying with the Protocol. Finally,this regulation modifies severalrecordkeeping and reportingrequirements to streamline the reportingburden, and facilitate compliance.EFFECTIVE DATE: The effective date ofthis rule is January 1, 1994, except thatappendix A of subpart A of 40 CFR part82, sections E. & G. (the addition ofMethyl bromide and the HBFCs to thelist of class I substances) is effectiveDecember 10, 1993 and § 82.4(d) iseffective January 10, 1994. See theSUPPLEMENTARY INFORMATION section ofthis document for reasons why a 30 daynotice is neither necessary norappropriate.ADDRESSES: Materials relevant to therulemaking are contained in Air DocketNo. A-92-13 at: U.S. EnvironmentalProtection Agency, 401 M Street, SW.,Washington, DC 20460. The publicdocket room is located in room M-1500,Waterside Mall (Ground Floor).

Materials may be inspected from 8:30a.m. until noon and from 1:30 p.m. until3:30 p.m. Monday through Friday. Areasonable fee may be charged by EPAfor copying docket materials.Information on this rulemaking can alsobe obtained from the StratosphericProtection Information Hotline at 1-800-296-1996.FOR FURTHER INFORMATION CONTACT: TheStratospheric Protection InformationHotline at 1-800-296-1996 or PeterVoigt, U.S. EPA, StratosphericProtection Division, Office ofAtmospheric Programs, Office of Airand Radiation, 6205J, 401 M Street, SW.,Washington, DC 20460, (202) 233-9185.


Additional Information on the EffectiveDate

The effective date of this rule isJanuary 1, 1994. Methyl bromide andthe HBFCs are added to the list of classI substances as of the date ofpublication. Section 602(d) of the CleanAir Act specifies that extension of thephaseout schedule for a newly listedsubstance may not extend the date fortermination of production for any classI substance to a date more than 7 yearsafter January I of the year after the yearin which the substance is added to thelist of class I substances. EPA believesCongress intended the seven years to betolled from no later than the date ofpublication of the listing, and that 30days notice before the listing becomeseffective for this purpose is neithernecessary nor appropriate.

EPA believes tat the time betweenpublication and January 1, 1994 issufficient for industry to comply withthe annual production and consumptionlimits beginning January 1, 1994. TheAgency believes this is a reasonableamount of notice for this kind ofregulation. Compliance with the annualproduction period controls necessitatesless advance notice than regulations forwhich compliance is measured over ashorter period. Also, since title VIcontrols of production and consumptionare implemented on an annual basis,implementation on January 1, 1994 isnecessary to avoid delaying theimplementation of control until January1, 1995. EPA believes that theenvironmental benefits associated withthe 1994 controls warrant this action.Moreover, the Agency notes that 1994restrictions on class I substances (otherthan methyl bromide) are necessary forcompliance with the Montreal Protocol.Other regulatory provisions in this ruleare tied to the production andconsumption phaseout. 'The class IIrestrictions do not take effect until

much later). Finally, EPA has takensteps to provide notice of this finalaction to the regulated industry uponsignature of the rule and prior topublication. For these reasons, EPAbelieves that the amount of timeprovided before the rule becomeseffective is reasonable.

EPA notes that the generalrequirement under 5 U.S.C. 553(d) (theAdministrative Procedure Act), thatpublication or service of a substantiverule be made not less than 30 daysbefore its effective date does not applyhere. Section 307(d)(1) of the Clean AirAct specifically applies to regulationsunder title V of the Clean Air Act andprovides that "[t~he provisions ofsections 553 through 557 and section706 of title VI shall not, except asexpressly provided in this subsection,apply to actions to which thissubsection applies." Nowhere doessubsection 307(d) expressly provide thatsection 553(d) of title V applies. Even ifsection 553(d) were to apply, EPAbelieves that, for the reasons describedabove, there is good cause under section553(d)(3) of title V to provide less than30 days notice following publication.

The contents of today's preamble arelisted in the following outline:I. BackgroundII. Accelerated Phaseout of Class I Controlled

SubstancesA. Summary of ProposalB. Comments on ProposalC. Final ScheduleD. Legal Authority

III. Accelerated Phaseout of Class IIControlled Substances

A. Statutory AuthorityB. Copenhagen Amendments to the

Montreal ProtocolC. CAA Petitions1. NRDC/FOE/EDF2. CFC Alliance Petition3. IEER Petition4. EPA's Proposed Action5. Response to lEER Petition6. Today's Final Action

IV. Addition of Methyl Bromide to List ofClass I Substances and PhaseoutSchedule

A. SummaryB. Legal Authority1. CAA Legal Authority2. Public Comments on Legal Issues

C. Background1. Initial Identification of Risks of Methyl

Bromide2. Petition to List3. Montreal Protocol Actions4. Domestic Regulatory ActionD. Today's Final Action1. Summary2. Decision to List3. Scientific Issues Related to Methyl

Bromidea. Faster Formation of HOBrb. HBr Branchingc. Other Sinks for Methyl Bromide


d. Natural and Man-made Emissionsa. Summary of ODP Discussion4. Uses and Substitutes for Methyl Bromidea. The NAPIAP Studyb. Commentsc Soil Fumigationd. Commodity Fumigationa. Structural Fumigation5. Analysis of Costs and Benefits6. Group Assignment and Baseline Year7. Interim Reductions and Phaseout

Schedule8. Labeling9. Essential Uses

V. Additional of Hydrobromofluorocarbons(HBFCs) to the List of Class I Substancesand to the Phaseout Schedule

VI. Trade RestrictionsA. Description of Proposed and Final

RequirementsB. Response to Major CommentsC. Legal AuthorityD. DefinitionsK Foreign States not Party to the Protocol

VII. Changes in Definition of ProductionA. Definition of Production1. Transformationa. Changes in Treatment of Transformationb. Recordkeeping and Reporting Changes

Relative to Transformation2. Destructiona. Elimination of Coincidental Unavoidable

Byproducts Provisionb. Destruction-Backgroundc. Definition of Destruction/Change in

Definition of Productiond. Treatment of Destructione. Response to Major Commentsf. Degree of Exemption/Credit Afforded for

Destructiong. Standards for Destructionh. Comments on Reporting and

Recordkeeping Associated withDestruction

3. SpillsB. ImportsC. International Issues1. Exports2. Transfers of Production Rights Between

NationsD. Insignificant Quantities1. Insignificant Quantities of Substances

Other than Methyl Bromide2. Insignificant Production of Methyl

BromideVIII. Other Issues

A. Definition of ImporterB. Tracking Essential UsesC. Addition of HCFCs to the EPCRA

Section 313 ListD. Environmental Impact StatementE. Recycled and Used Controlled

SubstancesF. TranshipmentsG. Publication of the Regulatory Text

IX. Changes from the Proposal and CurrentProgram

X. Impact of Final ActionXI. Additional Information

A. Executive Order 12866B. Regulatory Flexibility ActC. Paperwork Reduction Act

I. BackgroundA broad scientific consensus has

emerged that continuing depletion of

the stratospheric ozone layer will leadto increased penetration of harmful UV-B radiation to the earth's surface,resulting in potential damage to humanhealth and the environment. The risksfrom ozone depletion include increasesin skin cancer and cataracts,suppression of the human Immuneresponse system, damage to crops andaquatic organisms, increased formationof ground-level smog, and acceleratedweathering of outdoor plastics.

Several national and internationalassessments have been conducted overthe past years and provide usefulsummaries of the informationsupporting the linkage betweenemissions of certain chlorine andbromine-containing substances,depletion of the earth's protective ozonelayer, and damage to human health andthe environment. See for example,"Assessing the Risks of StratosphericOzone" EPA (1985); "ScientificAssessment of Ozone Depletion" WMO/UNEP (1989 and 1991); "Health andEnvironmental Effects of OzoneDepletion" UNEP (1989 and 1991), and"Methyl Bromide: Its AtmosphericScience, Technology, and Economics."

While considerable uncertaintiesremain in fully understanding thecomplex reactions that occur in theatmosphere that cause depletion of theozone layer, scientific research hasmade remarkable progress since 1974 inunderstanding the atmosphericprocesses that lead to depletion of theozone layer both in the polar regionsand globally. In response to the growingbody of evidence that linkschlorofluorocarbons (CFCs) and otherchlorinated and brominated compoundsto ozone depletion, the internationalcommunity reached agreement in 1987on a landmark treaty.

The Montreal Protocol on Substancesthat Deplete the Ozone Layer (MontrealProtocol) initially called for a fiftypercent reduction in CFC productionand consumption by the year 1998 anda freeze in halon production andconsumption. When originallynegotiated In 1987, it had been signedby 23 nations and the EuropeanCommunity.

In the six years since its initiation, theProtocol has evolved rapidly inresponse to new scientific andtechnology developments. As newevidence was developed suggesting thatthe risk of ozone depletion from CFCsand other compounds was greater thanhad previously been thought, nations ofthe world responded by strengtheningthe Protocol first in 1990 and again in1992.

As the treaty currently stands, thenumber of Parties has grown to over 125

nations. Instead of a reduction of 50%in CFCs by 1998, the Protocol now callsfor a phaseout in 1996 with the possibleexception for critical uses. In the case ofhalons, the Protocol calls for theirphaseout by the end of 1993. In additionto the originally controlled compounds,additional compounds were added firstin 1990 when methyl chloroform andcarbon tetrachloride were added by theParties and scheduled for phaseout. Thephaseout date for both of thesecompounds Is now 1996. In addition, attheir meeting in 1992, the Partiesadopted an amendment calling forcontrols and the eventual phaseout ofHCFCs and a freeze on production andconsumption of methyl bromide (exceptquarantine and preshipment uses).

The acceleratedphaseout andexpanded scope of compounds coveredby the Montreal Protocol were inresponse to a series of reports from thescientific community stating that ozonedepletion in Antarctica appears to bedirectly the result of increasedconcentrations of man-made chlorinatedand brominated compounds, that thepotential exists for more significantdepletion in the Arctic region, and thatmid-latitude concentrations of ozonehave also been reduced over the pastdecade or so. A more detaileddescription of recent scientific evidenceis included in EPA's March notice ofproposed rulemaking (NPRM) (March18, 1993, 58 FR 15014).

The most recent scientific reports onozone depletion were completed afterthe publication of the March proposaland show that ozone values over mid-latitudes have been substantially lowerin the winter of 1992 and spring of 1993than had been previously recorded forthese times of the year. On April 23,1993, a paper by Gleason et al. waspublished in Science and included datafrom the Total Ozone MappingSpectrometer (TOMS) instrument on-board the Nimbus 7 satellite whichshowed that global ozone levels were 2-3% lower than any previous year forthese months and 4% lower thannormal. Ozone levels for the northernmid-latitudes were about 10% lowerthan historical averages for this time ofthe year for this region and appear tohave continued at these low levelsthrough the early part of the summer.While the precise cause of these lowozone values cannot yet be determined,it may well prove that they are the resultof the indirect effects from the eruptionof Mt. Pinatubo in June 1991. Theseeffects could result from the injection ofaerosol particles into the stratospherewhich provide surfaces for accelerateddepletion of ozone by chlorine orbromine species or which increase

65020 Federal Register I Vol. 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations

stratospheric temperatures and,therefore, lead to faster reactionsinvolving chlorinated and brominatedspecies resulting in more depletion.Investigations continue into betterdefining the exact role of the sulfurparticles from the volcano in the recentincrease in depletion.

II. Accelerated Phaseout of Class IControlled Substances

A. Summary of ProposalEPA considered several schedules in

the March 18 proposal to accelerate thephaseout of class I controlledsubstances. The Agency had receivedprior to the proposal two petitions toaccelerate the phaseout, as well asseveral industry comments on thosepetitions, submitted under section 606of the Clean Air Act Amendments.These two petitions laid outrecommended schedules to completethe phaseout sooner than the year 2000,the date required under section 604 ofthe Clean Air Act. The Alliance for aResponsible CFC Policy (the Alliance)petitioned the Agency to complete thephaseout by 1996, allowing for a limitedvolume of CFC production until 2000 toservice existing refrigerator and air.conditioning systems. The Alliancesuggested a cut of 50 percent of 1986production levels for 1993. withsubsequent cuts to 40 percent and 25percent in 1994 and 1995, respectively.The Natural Resources Defense Council,the Friends of the Earth, and theEnvironmental Defense Fund (NRDC/FOE/EDF) requested more drasticreductions in 1992, 1993 and 1994 of 40

- percent, 25 percent and 15 percent,respectively, with a complete phaseoutby the end of 1994 for CFCs. Theenvironmental groups also requestedthat the production of halons andcarbon tetrachloride stop as of 1992,with a 50 percent of baseline cut formethyl chloroform in 1992, and itscomplete phaseout by 1993.

In November of 1992, the Parties tothe Montreal Protocol met and agreed toa set of "adjustments", or changes to thephaseout schedules for the existingcontrolled substances. The Partiesagreed to phase out all CFCs by 1996,allowing for production andconsumption of 25 percent of baselinelevel in 1994 and 1995. The Parties alsoagreed to cut carbon tetrachloride to 15percent of baseline levels in 1995, andto complete its phaseout by 1996.Methyl chloroform was to be eliminatedby 1996 also, with a cut to 50 percentof baseline in 1994 and 1995. TheParties agreed to phase out theproduction of halons by the end of 1993.In order to facilitate these expedited

reduction schedules, the Parties alsoestablished criteria for exemptingessential uses from the productionphaseout.

In response to the two petitions andthe agreement reached by the Parties inCopenhagen, the Agency proposed inthe March 18 NPRM to cut CFCproduction and consumption to 25percent of baseline in 1994, with asubsequent cut to 15perent by 1995.The Agency proposedto phase out CFCsby 1996, with no production extendingbeyond that date to service existingequipment, as had been requested by,the Alliance, but discussed criteriaestablished under the Montreal Protocolfor granting essential use exemptions.Since the publication of the March 18NPRM, the Agency came to believe thatthe 15 percent level it had proposed for1995 would be too stringent for thesectors that rely on CFCs. Although CFCuse has dropped significantly over thelast few years, a reduction to 15 percentof baseline levels for CFCs in 1995could hurt certain sectors, wherealternatives are not yet feasible (e.g.metered dose inhalers, possiblyhousehold refrigerators), or where CFCsare required for servicing equipmentwith long useful lifetimes such as theautomobile air conditioner and comfortcooling sectors. Since retrofits forexisting equipment are still beingevaluated and tested for several largeuse sectors, the Agency believed that theproposed level of 15 percent In 1995could deleteriously affect consumersand these user groups. EPA asked forcomments at the public hearing onchanging the 1995 limit to 25 percentand published a separate noticerequesting comment on this issue (58 FR25793, April 28, 1993).

After its proposed regulation wasinitially signed by the EPAAdministrator, DuPont announced itsintent to phase out its production ofCFCs by the end of 1994. Since DuPonthas historically been allocated abouthalf of all allowances (based on the 1986base year), its decision to stopproduction a year ahead of the scheduleproposed by EPA has potentiallysignificant consequences. EPA alsorequested comments at the publichearing on the possible implications ofDuPont's action.on sectors requiringCFCs.

With respect to class I substancesother than CFCs, the Agency proposedto phase out production of carbontetrachloride and methyl chloroform byJanuary 1, 1996 also, with interimreductions of 50 percent and 15 percentof baseline for carbon tetrachloride in1994 and 1995, and 50 percent and 30

percent of baseline cuts for methylchloroform for those years.

B. Comments on Proposal

EPA received eight commentssupporting the proposed acceleratedschedule with the modified 1995 limitof 25% baseline production andconsumption. These commenters.primarily CFC and methyl chloroformusers, believed the proposed schedulefeasible, and that many were on the wayto completing the phaseout. However,several of these companies warned thatany further acceleration wouldjeopardize phaseout plans and wouldpossibly force the use of unsafesubstitutes. Many agreed that the UnitedStates must adhere to the internationalphaseout dates set in the MontrealProtocol, but that it should notunilaterally expedite the phaseout.

Two environmental groups objectedto the proposed scheduling, botharguing that a faster acceleratedschedule was possible and that CFCproduction should cease as of January 1,1995. One commenter cited DuPont'sand the European Community'sannouncements to stop production as ofthat date as proof that such a phaseoutis possible. Both commenters believethat methyl chloroform could be phasedout in 1995, and that carbontetrachloride could be phased out byJanuary 1, 1994.

In addition, EPA received severalcomments on the issue of Dupont'sdecision not to produce CFCs in 1995.Several major industry groups statedthat full produakion of the 25 percentallowance is critical to the smoothtransition out of CFCs and that withoutthis quantity available in 1995 severeshortages are likely to exist andsignificant economic hardship toconsumers and equipment owners islikely to result. One commenteropposed any Agency action on thisissue, suggesting that DuPont's decisionis better for the environment. DuPont inits comments reiterated that it believesthat demand will drop off to such adegree in 1995 that its allocation willnot be necessary, but that if the Agencybelieves that production of the full 25percent of baseline levels for 1995 isnecessary it would not object if theAgency were to take action to facilitatethis production.

Based on its current view of themarketplace, EPA expects that almostall major uses of CFCs in newequipment will have shifted by January1, 1995, with the possible exception ofmetered dose inhalers and some lines ofhome refrigerators. Thus, the majorsource of demand for CFCs in 1995 will


be to service existing refrigeration and'air-conditioning equipment.

To reduce future demand by thosesectors, EPA has initiated a number ofactivities to implement its mandatoryrecycling and recovery and disposalrules, to minimize leaks fromequipment, and to encourage retrofitsand replacements of existing air-conditioning and refrigeration systems.However, in the absence of a drop-inrefrigerant to service existing CFC-1 2vehicles, the Agency has determinedthat the Protocol allowable production*and consumption of 25% in 1995 isnecessary to minimize economicdisruption and to facilitate a smoothertransition out of CFCs on the acceleratedschedule adopted today. Furthermore,as explained below in the section onessential uses, EPA denied several suchapplications related to servicing airconditioning and refrigerationequipment on the assumption that stepswill be taken to ensure that fullproduction of CFCs is permitted in 1994and 1995 to provide additional suppliesbeyond 1995 in order to minimize thecosts of the phaseout to vehicle andequipment owners. As a result, therulemaking contains the legallypermissible 25 percent allowableproduction level in 1995 and theAgency intends to follow-up on theissue to ensure that this level ofproduction is made available.

C. Final ScheduleIn today's rule, the Agency has

finalized the following schedule for theaccelerated phaseout of the class 1,groups I through V controlledsubstances. This is the scheduleoriginally proposed in the March 18notice, with the exception of the 25percent level for CFCs in 1995, which isthe level on which the Agencyrequested comment in its April 28,1993, Federal Register Notice.

FINAL SCHEDULE FOR CLASS I CON-TROLLED SUBSTANCES, GROUPS I,II, III, IV AND V

[Percent Allowable of Baseline Production andConsumption]

Year Carbon Methyl(be- CFCs Halons tetra- chloro-gin- (G our ou p chlo-ning Ianri (Grou ide formJa 11) 11) (Group

1994. 25 0 50 501995. 25 0 15 301996. 0 0 0 0

The Agency has decided on thisaccelerated schedule for several reasons.First, with one exception discussed

below, this is the schedule that theParties agreed to in Copenhagen inNovember of 1992. The United Statesagreed to this schedule at that time, andbelieve that the schedule appropriatelyreflects the fastest technological andeconomically feasible reductionschedule. The United States, as well asthe majority of the Parties, believes thata 1996 phaseout is possible, but that anearlier phaseout would exceedtechnological capabilities and result inexcessive economic costs. Withoutinternational commitment to a phaseoutdate, this unilateral action by the UnitedStates to phase out earlier would posesignificant costs, but would yield fewbenefits. It is true that despite theagreed-to 1996 phaseout, the EuropeanCommunity and several other countriesparty to the Protocol have decided tophase out of the class I chemicals oneyear earlier (i.e., January 1, 1995).However, EPA understands that theEuropean Community and othercountries pursuing an earlier phaseoutare not as dependent on CFCs forrefrigeration and air-conditioning as theUnited States. Consequently, thefinancial cost of such a phaseout by theEuropean Community is not nearly asgreat as it would be for the United States(see cost implications below). EPAbelieves that the schedule set inCopenhagen is sufficient to allow anorderly transition out of class Ichemicals without significantly furtherdegrading the ozone layer. However,EPA believes that a faster schedule forthe reduction in 1995 of methylchloroform in the United States is bothtechnically and economically feasibleand environmentally desirable. As aresult, EPA proposed and is todayfinalizing the proposed reduction to 30percent of baseline levels for thiscompound compared to the 50 percentreduction required by the MontrealProtocol for 1995.

Recent analysis Indicates thatsubstantial costs to U.S. industry andconsumers would occur if the U.S. wereto accelerate further the phaseout forCFCs to 1995, rather than 1996. Muchof this cost would fall on consumers andequipment owners in the refrigerationand air-conditioning sector. Unlikeother sectors, such as solvents and foamblowing, the switch to alternatives hasbeen complicated by the search forrefrigerants that could be used to serviceexisting equipment and would notdiminish the efficiency and capacity ofexisting equipment, and by the searchfor refrigerant-compatible lubricatingoils. Although alternatives have beendeveloped for new equipment, the issueof servicing existing equipment with

useful lifetimes well exceeding the 1995phaseout is substantially morecomplicated. In many cases, owners ofexisting equipment must makemodifications to accommodate possiblealternatives. This problem iscomplicated by the large amount of air-conditioning and refrigerationequipment in existence. EPA andindustry estimates that over 100 millionmobile air-conditioners currentlyrequire CFC-12 as a refrigerant. Somepercentage of these will need to beretrofitted if CFC-12 is not availablepast the phaseout. Although refrigerantrecycling and recovery at disposal siteswill supply this sector some CFC-12past 1995, the required volume ofrefrigerant will exceed the supply ofrecycled CFC-12, even with 1995production at 25% of baseline. (EPAcould not allow production at greaterthan 25% level,'however, because theProtocol establishes the level of 25% for1995.)

For stationary refrigeration sectors,EPA estimates that more than 67,000CFC chillers, as well as 7,000 industrialprocess chillers are currently operatingin the United States. This equipmenthas a useful life of 30 years or longer.Although owners are beginning toretrofit and replace these chillers, thepace of these activities has been slow,and it is not clear that there will besufficient recycled refrigerant past 1995.Retrofits are available, but costs varysignificantly by sector and even withinsectors by type of equipment.

The Agency had proposed in itsMarch 18 NPRM to limit production andconsumption to only 15 percent ofbaseline in 1995. However, EPArequested comment on whether the lessstringent reduction to 25 percentbaseline would be more appropriate (58FR 25793). In today's final action, EPAis allowing the 25 percent baselineproduction to be consistent with theprovisions of the Copenhagen agreementby the Parties, and because consumersand equipment owners would facesignificant retrofit costs if productionlevels were further reduced in 1995. Theneed for full allowable productionunder the Montreal Protocol in 1995 iseven more critical given the limitedessential uses likely to be granted underthe Montreal Protocol for productionafter that date.

EPA is limiting carbon tetrachlorideto 50 percent of baseline in 1994, witha subsequent cut to 15 percent ofbaseline in 1995, and no production in1996, consistent with the Protocol.Environmentalists, in their commentson the proposal, requested a carbontetrachloride phaseout date of January 1,1994. In response, the Agency believes


that significant steps have been taken toeliminate the use of this chemical forboth health and environmental reasons.However, the remaining uses are oftenunique applications for which theindustry continues to search forsubstitutes. EPA believes that thisremaining 15 percent of production andconsumption for carbon tetrachloride isnecessary to assist the industry in thetransition to a complete phaseout.

EPA intends to limit methylchloroform to 50 percent of baselineallowances in 1994, and to furtherreduce consumption and production ofthis chemical to 30 percent of baselinein 1995, with a complete phaseout in1996 also. Environmentalistscommented that EPA should phase outthis chemical in 1995. In response, EPAbelieves that the 1996 phaseout is moreappropriate. This user sector has beensubjected to more immediate and drasticreductions than the other majorcontrolled substances over the last threeyears, and to phase out one year earlierthan required under the MontrealProtocol would place an undue burdenon a sector that involves many smallusers and has faced continuallychanging reduction schedules. Despitethis, EPA is only allowing productionand consumption equal to 30 percent ofbaseline, due to the advancements madeby the user sector rather than the 50percent allowed under the Protocol.EPA believes that this level is a feasibleone.

EPA performed a comprehensivereview of all costs and benefits of thephaseout of class I chemicals associatedwith the various proposed schedules.However, the quantification of benefitsis difficult. In the past, scientists havegenerally underpredicted the extent ofozone depletion caused by thesechemicals. For this reason, scientistsand policymakers have relied more onchlorine loading calculations as asurrogate for risk of ozone depletionthan predictions of ozone depletion.Policymakers have set a targetconcentration of 2 parts per billion(ppb) of chlorine as the level thatexisted prior to the Antarctic ozonehole. All policies are directed towardreducing the peak chlorine levels andminimizing the length of time thatconcentrations exceed 2 ppb.

EPA eamined the impact on chlorinelevels under the schedules proposed bythe environmental groups and byindustry as well as their suggestedschedules submitted in their commentson the proposal. According to this.analysis, all three schedules wouldreturn chlorine concentrations to below-2 ppb at the same time over the next 100years. As for "peak" concentrations, the

environmental groups' schedule limitedpeak concentrations to little over 4.0ppb by the turn of the century, with theconcentrations under the schedulesannounced here also peaking at thistime, but at approximately 4.1 ppb. Thechlorine loadings for the industryschedule rose to about 4.2 ppb, butpeaked at a later date than either thefinal rule schedule or theenvironmentalists' schedule. Under allschedules, chlorine concentrationswould decrease from the peak levelseveral years after the 1995 phaseoutand again following the HCFC ban.Although chlorine concentrations underthe environmentalists' schedules dopeak at the lowest level of the chlorineconcentrations of the three schedules,EPA believes that the total volume ofadditional chlorine loading from thefinal rule schedule over the earlierphaseout of environmentalists' scheduleis not significant, especially when

-considered over the next century.EPA calculated the benefits for the

various accelerated schedules andcompared those benefits with theircorresponding costs through a moretraditional cost-benefit analysis. In pastanalysis of the benefits of reducingproduction and consumption of ozone-depleting chemicals, the Agency hasmonetized many of the health andenvironmental benefits (skin cancer andcataract cases avoided, crop loss,materials damage, etc.) due to theprotection of the ozone layer. Socialcosts reflect the expenses incurred fromthe transition to alternatives.

The table below presents the costsand benefits for the phaseout schedulesanalyzed for the rulemaking.

INCREMENTAL COSTS AND BENEFITSOF THE ACCELERATED CLASS IPHASEOUTS OVER THE 2000PHASEOUT (METHYL BROMIDE NOTINCLUDED; COSTS AND BENEFITSDISCOUNTED AT A 2% DISCOUNTRATE)[In Billions of Dollars-Cumulative Costs:

1989-2075 In 1985 Dollars]

NetScfnado Bine- costs bene-fits fits

Final rule .......... 48-189 7 41-182NRDC ............... 56-221 29 27-192AllIanceI .......... 39-152 1 38-151

1The "Alliance" Is the Alliance for a Re-sponsible CFC Policy. an Industry lobby grouprepresenting producers and users of thesechemicals.

The table does not reflect the largenumber of uncertainties associated withsuch an analysis. The numerical value

of benefits varies depending on theassumed value of life, while costs reflectsocial costs and not necessarily theactual costs faced by companies.However, despite these uncertainties,the analysis does provide a range of netbenefits for the phaseout of class Ichemicals, and indicates that these netincremental benefits range fromapproximately $37 to $192 billion. TheNRDC phaseout achieves the highest netbenefit under one set of benefitassumptions, but the lower end of itsnet benefit range is below the range forboth the Alliance and the final ruleschedule. This is because of therelatively high cost of the NRDCphaseout. (The Agency analyzed thereduction schedule suggested in NRDC'sresponse to the proposed rule. EPA'sanalysis indicates that, although costsare lowered, the net incrementalbenefits are approximately the same asthose of the schedule proposed in theirpetition.) Both the final rule scheduleand the Alliance schedule have similarnet benefits, but the upper range of thebenefits of the final rule scheduleexceeds the benefits range for theAlliance schedule. For these reasons,the Agency believes it appropriate to setthe reduction schedules as specified inthis final rule.

In performing this analysis, theAgency examined the necessaryreductions to meet the production andconsumption targets of this rule. ForCFCs, the final rule schedule requires a75% reduction in the 1986 baseline inboth 1994 and 1995. For the air-conditioning and refrigeration sectors,EPA assumes that there is fullimplementation of recovery ofrefrigerant at servicing and disposal.Also, the Agency assumes that all newequipment in these sectors contain suchalternatives as HFC-134a, HCFC-123,ternary blends and ammonia, and thathigh-efficiency purges have beeninstalled on half of the existing chillersby the end of 1995.

For the foam sector in 1994 and 1995,the Agency estimates that more than23% of the rigid polyurethaneboardstock market will have shifted to,product substitutes, and that theremaining share of that sector will shiftto HCFC substitutes. One commenterdid note that the appliancemanufacturers would not completelyshift to HCFC replacements by the endof 1993, as had been noted in theproposal. All other foams have shiftedto water blown foams or productsubstitutes. With the exception ofappliance foam, EPA expects all uses ofCFCs in this sector will have beeneliminated by the end of 1993.


EPA expects that both the solvent andsterilant sectors will continue to useengineering and housekeeping controlsto limit use of CFCs and shift toalternatives or process changes.Aqueous, semi-aqueous cleaning, and"no clean" technologies continue topenetrate the new equipment market,while existing equipment adopts drop-in replacements. Many of the aerosolproducts have already moved toalternative propellants and deliverysystems. EPA expects that all uses ofCFCs in these sectors will be eliminatedby the end of 1995.

By the beginning of 1996 all CFC usesectors, except for certain essential uses,will have made the transition toalternative chemicals and products.However, as noted earlier, existing air-conditioning and refrigerationequipment will require utilizing somecombination of existing CFCinventories, maximum recycling andrecovery at disposal, retrofits, actions tominimize leaks, and replacement ofolder, less energy efficient equipment.

The final rule schedule calls for a50% reduction in 1989 baseline use ofmethyl chloroform in 1994, with anadditional 20 percent reduction in 1995.The Agency believes that this sectormay accomplish these reductions in1994 through implementation ofengineering and housekeeping controlsin all solvent equipment, and byindustry beginning to use aqueouscleaning in cold cleaning andconveyorized vapor degreasers. Theadhesives sector will continueimplementation of water-basedadhesives, and begin to use hot meltsand other solvent based adhesives,while the coatings and inks sector willcontinue to use powder coatings, andexpand use of water based coatings.

The 1995 target of 30% of baselinemay be achieved by implementation ofadditional alternative solvents in newand existing cold cleaning,conveyorized and open-top equipment.In addition, methyl chloroform aerosolproducers and users will begin to adoptpetroleum distillates and water basedapplications. The industry willcompletely phase out of methylchloroform by the full penetration ofthese technologies by 1996 exceptpossibly for limited essential uses.

The schedule in today's final rulerequires the complete phaseout ofhalons by January 1, 1994. Indeed theAgency understands that allmanufacturers in the United States willsoon have stopped production of thesecompounds. The fire preventioncommunity has successfully completedthe transition by adopting alternativesas well as minimizing the emission of

halons during training, and increasedrecycling through the recentestablishment of halon banks. EPAcommends the halon user sector fortheir efforts in the elimination of theiruse of new, virgin halon. Efforts toestablish halon banks are nowunderway and should provide adequatesupplies of recycled halons for allcritical uses well into the future. Thecooperation of this industry and itsresolve to minimize emissionsrepresents a model for the remainingsectors to achieve the same results.

In the March proposal, EPA alsodiscussed in detail the essential useprovision provided for in a decisiontaken by the Parties to the MontrealProtocol at their 1992 meeting inCopenhagen. The proposal discussedthe criteria established by the Parties forgranting essential uses, noted that anyuses granted under domestic rules mustbe consistent with actions taken by theParties, and stated that EPA would berequesting essential use nominationsthrough separate Federal Registerannouncements.

EPA has published two suchannouncements in the past six months.The initial announcements dealt withessential use nominations for halons for1994 (58 FR 6788). Following that, EPAissued a second announcement (58 FR29410) covering CFCs, carbontetrachloride, methyl chloroform, andHBFCs for production in 1996.

In the case of halons, EPA received anumber of applications for essentialuses, but was able to cooperate witheach of the applicants to address theirshort-term needs, and therefore theUnited States did not nominate anyessential uses for halons for 1994.Nominations were, however, submittedby about a dozen other nations. As afirst step in the review process, thesenominations were examined by thehalon committee of the Technology andEconomic Assessment Panel under theMontreal Protocol. This panelconcluded that either adequatesubstitutes existed for each of theseapplications or adequate suppliesexisted in the halon bank, and thereforerecommended against any additionalproduction in 1994 for halon essentialuses. This recommendation wasunanimously supported at the Open-Ended Working Group which met inAugust 1993 in Geneva. The finaldecision will be taken this year by theParties at their meeting in Thailand.

In the case of the other compounds,EPA received approximately twenty. Inevaluating whether additionalproduction would be needed in 1996,one important consideration is whetheradequate supplies will exist, either from

recycled or recovered sources or fromproduction allowed in 1995 or before,that might be available for use in 1996and beyond. To the extent that suppliesare available from any of these sources,then the criteria of "no availablesupply" necessary for granting anessential use would not be satisfied.

The United States Governmentreviewed these applications andforwarded to the Protocol's Secretariatnominations for production after 1995for use in: Metered dose inhalers andother specified medical applications; abonding agent for the Space Shuttle;

.aerosol wasp killers; a limited use in aspecified bonding application andspecified polymer application; and ageneral nomination for laboratory usesunder specified limitations. The UnitedStates did not forward applicationssubmitted in the area of servicingautomobile air conditioners andbuilding chillers. These were rejectedbecause the government believed that bytaking all economically feasible stepsincluding shifting to alternatives,initiating retrofits, reducing emissionsand utilizing 1994 and 1995productions of CFCs, adequate supplieswould exist for servicing for 1996 andfor the same period beyond. However,in putting forward its nominations, theUnited States discussed its continuedconcern about the potential costs if asignificant number of expensive retrofitsare required. It reserved the right infuture years to submit nomination inareas other than those submitted for1996. The decision by the Parties onessential uses for CFCs, MCF, carbontetrachloride and HBFCs for 1996 willbe taken at the 1994 Meeting of theParties. EPA will periodically informthe public through Federal Registernotices of the schedule for futureessential use nominations and theoutcome and decisions by the Parties ofpast nominations.

D. Legal AuthoritySection 606 of the Act provides the

Administrator with authority toaccelerate the phaseout of ozone-depleting substances. That sectionauthorizes the Administrator topromulgate regulations that "establish aschedule for phasing out the productionand consumption of class I and class IIsubstances (or use of class II substances)that is more stringent than set forth insection 604 or 605, or both, if:

(1) Based on an assessment of crediblecurrent scientific information (includingany assessment under the MontrealProtocol) regarding harmful effects onthe stratospheric ozone layer associatedwith a class I or class II substance, theAdministrator determines that more


stringent schedule may be necessary toprotect human health and theenvironment against such effects,

(2) Based on the availability ofsubstitutes for listed substances, theAdministrator determines that such amore stringent schedule is practicable,taking into account technologicalachievable, safety, and other relevantfactors, or

(3) The Montreal Protocol is modifiedto include a schedule to control orreduce production, consumption, or useof any substance more rapidly than theapplicable schedule under this title. Inmaking any determination underparagraphs (1) and (2), theAdministrator shall consider the statusof the period remaining under theapplicable schedule under this title."

As explained above, section 606(a) ofthe Act sets forth the criteria on whichEPA is to base a decision to acceleratethe phaseout schedule for ozone-depleting substances. The acceleratedschedules established today are justifiedunder both sections 606(a)(1) (necessaryto protect human and the environment)and 606(a)(2) (technologically feasible).

Recent scientific evidence, includingthe latest of the Montreal Protocolassessments, provide ample "credible"evidence of the need for furtherreductions. As discussed above, thelatest scientific evidence provided byNASA, NOAA, and the UNEPassessment demonstrates that ozonedepletion is occurring at a far morerapid rate than was thought to be thecase at the time of the enactment of the1990 Clean Air Act Amendments. Thisevidence clearly warrants anacceleration of the phaseout schedule.With respect to section 606(a)(2), thesubstantial reductions in production ofclass I substances highlight the progressbeing made in shifting to alternatives.Furthermore, the latest UNEPTechnology Assessment providesadequate documentation of thetechnological availability of acceleratingthe phaseout of these chemicals.

Section 606(a)(3) also providesauthority for implementing theadjustments to the Protocol agreed to atthe Fourth Meeting of the Parties, i.e.,the acceleration of the phaseouts ofCFCs, halons, carbon tetrachloride, andmethyl chloroform. Unlikeamendments, adjustments do not needto be ratified by a specified number ofParties before they enter into force. Theadjustments entered into force onSeptember 22, 1993, prior to thepromulgation of this phaseout rule.Thus, EPA believes that section606(a)(3) provides additional authorityfor accelerating the phaseout of class Isubstances at this time.

With respect to amendmentsapproved by the Parties to the Protocolthat accelerate the phaseout ofsubstances listed under the CAA, suchas HCFCs, section 606(a)(3) providesadditional authority for the accelerationof their phaseout schedules once theamendments have been ratified by thenecessary 20 Parties; all that remains isthe passage of time before theamendments enter into force.

EPA also notes that section 614(b) ofthe CAA provides that in the case of aconflict between title VI of the CAA andthe Protocol, the more stringentprovision shall govern. Thus, the Actrequires the Agency to establishphaseout schedules at least as stringentas the accelerated ones agreed to by theParties. The phaseout schedules that theAgency is establishing today are at leastas stringent as those required by theadjustments to the Protocol. The finalphaseout dates that are required for allClass I substances are the same as thosein the new adjustments. The interimreductions required for CFCs in 1994and 1995, for methyl chloroform in1994, and for carbon tetrachloride in1995 are also identical to thosecontained in the adjustments. The otherrequired interim reductions are morestringent than those contained in theadjustments. These are beingestablished under the authority grantedin section 606(a) (1) and (2), asexplained in the NPRM (58 FR 15021-22).

EPA believes that an acceleration ofthe phaseout can be justified undereither paragraph (1) or paragraph (2) ofsection 606(a), but that even if EPAdetermines that an accelerated scheduleis warranted based solely on anassessment of credible scientificinformation under paragraph (1), it cantake into account the availability ofsubstitutes in determining the specificaccelerated schedule that itpromulgates.

EPA believes that this view isreasonable and supported by both thelanguage and the legislative history ofthe 1990 Clean Air Act Amendments.The last sentence of section 606(a)provides that in making anydetermination under paragraphs (1) and(2), the Administrator shall consider thestatus of the period remaining under theapplicable schedule under this title.Implicit in the sentence is the notionthat EPA will consider bothenvironmental need and technologicalachievability in making "any"determination to accelerate the phaseoutschedule. On its face, the sentenceprovides that even when making adecision regarding accelerationpursuant to paragraph (1), EPA is to

"consider the status of the periodremaining under the applicableschedule." This connotes that EPA is toconsider the practicality of anaccelerated schedule, including theavailability of substitutes.

Even apart from the language at theend of section 606(a), which was addedduring the House-Senate Conference onthe 1990 Clean Air Act Amendments,EPA believes it has the authority to takeinto account the technologicalachievability of a specific schedule inaccelerating a phaseout schedule on thebasis of scientific findings. Congressitself recognized the linkage betweenthe need to phase out the productionand consumption of ozone-depletingchemicals to protect the environmentand human health and the availabilityof substitutes for those chemicals. Eventhough Congress understood that anydelay in phasing out ozone-depletingsubstances would delay a return tonormal ozone levels, Congress did notrequire an immediate phaseout. Instead,Congress established a schedule phasingout the chemicals over a period ofseveral years to allow time forsubstitutes to be developed and foraffected industries to adjust.

The Senate Environment and PublicWorks Committee noted that the"importance of accelerating thephaseout schedule is reflected in theestimate, presented by expert witnesses,that a three to five year delay in thephaseout deadline translates into anadditional 20 to 30 years of elevatedchlorine levels in the atmosphere. Anadditional 20 years of elevated chlorinelevels presents an unacceptable risk thatmust be avoided if it is at all possibleto do so." (S. Comm. Rep. No. 101-228at 394). Furthermore, with respect to aprovision concerning the phaseout ofHCFCs, the Committee Report statedthat it must be recognized "that the goalof eliminating the potent, long-livedCFCs as rapidly as possible is, to someextent, dependent on the near-termavailability of HCFCs as intermediatesubstitutes * * *." (Id. at 395) Thus, theSenate clearly recognized that theavailability of substitutes had to betaken into account in determining howquickly CFCs could be phased out,notwithstanding the environmentalbenefits that would result from an evenmore rapid phaseout.

Moreover, in explaining the provisionof the Senate Committee Reportconcerning the acceleration of thephaseout schedule, which provided forEPA to accelerate the schedule if any ofthree criteria substantially identical tothose in the Amendments were met, theCommittee stated that "[in keepingwith the national policy of eliminating


the production before the year 2000. tothe maximum extent practicable, theAdministrator is directed to determineno less often than every 18 monthswhether any of three conditionsrequiring acceleration of the schedulehas been satisfied." (S. Comm. Rep. No.101-228, Dec. 20, 1989, at 393.,emphasis added). The Committee's useof the terms, "as rapidly as possible"and "to the maximum extentpracticable," demonstrates itsrecognition of the role of considerationsother than strictly scientific ones in theapplication of section 606(a).

In taking the availability of substitutesinto account, the Administrator mayconsider the future potential forsubstitutes, as well as the cost of thesubstitutes, and adopt a phaseoutschedule that will be technology-forcingby inducing the development ofsubstitutes on a more accelerated pacethan would otherwise have been thecase. This is confirmed by the sameSenate Committee Report that indicateda role for technological factors in theestablishment of a phaseout schedule.The report notes that a unilateralacceleration of the phaseout schedule bythe Administrator may be necessary "toaccelerate technological developments."(Id. at 393).

EPA believes that the acceleratedphaseout schedules for class Isubstances are fully justified and withinits authority.

I. Accelerated Phaseout of Class HControlled Substances

In today's final rule, EPA acceleratesthe phaseout of production andconsumption of HCFC-22, HCFC-141band HCFC-142b, three relatively highODP-weighted HCFCs. The Agencybelieves that this approach will meet therequirements of the CopenhagenAmendments, as well as comply withthe requirements of the Clean Air Act.Specifically, the Agency will ban theproduction and consumption of HCFC-141b as of January 1, 2003. Theproduction and consumption of HCFC-142b and HCFC-22 will be frozen at'baseline levels in 2010, with a completephaseout of these chemicals by January1, 2020. Production and consumption ofthese chemicals between 2010 and 2020can only be for the purpose of servicingequipment manufactured prior toJanuary 1, 2010. Production andconsumption of the remaining HCFCswill be frozen at baseline levelsbeginning January 1, 2015, with all usesof virgin production of these materialsbanned except for use as a feedstock oras a refrigerant in appliancesmanufactured prior to January 1, 2020.

The final category of HCFCs would bephased out by January 1, 2030.

The Agency has not established abaseline year or corresponding levels forthese HCFCs at this time. EPA willcontinue to monitor the production andconsumption of these chemicals todetermine the appropriate baseline toensure that the requirements of theCopenhagen Amendments and theClean Air Act are met. Although abaseline level may be required in orderto establish the appropriate freeze levelsin 2010 and 2015 as required undersection 605(d) of the Clean Air Act, theAgency believes that action so far inadvance of these dates is neithernecessary nor desirable.

A. Statutory AuthorityToday's final rule accelerates the

phaseout of production andconsumption of specified HCFCs. Therevised schedule for phasing out thesecompounds modifies the schedulecontained in section 605 of the CAA,which states: "(a) That effective January1, 2015, it shall be unlawful for anyperson to introduce into interstatecommerce or use any class II substanceunless such substance-41) has beenused, recovered, or recycled; (2) is usedand entirely consumed (except for tracequantities) in the production of otherchemicals; or (3) is used as a refrigerantin appliances prior to January 1, 2020,and (b) that effective January 1, 2015, itshall be unlawful for any person toproduce any class H substance in anannual quantity greater than thequantity of such substance produced bysuch person during the baseline year.Effective January 1, 2030, it shall beunlawful for any person to produce anyclass II substance."

The authority to accelerate thephaseout of HCFCs is contained insection 606 of the CAA, which has beendiscussed above in the context of theaccelerated phaseout of class Isubstances. As part of the petitionssubmitted to the Agency under section606 of the CAA, both NRDC/FOE/EDFand the CFC Alliance proposedmodified dates for the phaseout ofcertain HCFCs. In addition, the Agencyreceived a third petition dealing withclass H substances submitted by theInstitute for Energy and EnvironmentalResearch (JEER). The Agency respondedto the first two sections in the March 18proposal while the Agency's response tothe IEER petition is discussed in detailbelow

B. Copenhagen Amendments to theMontreal Protocol

At the Fourth Meeting of MontrealProtocol in Copenhagen in November

1992, the Parties agreed to amend theProtocol to include a control regimerestricting the consumption of HCFCs.The measures adopted by the Partiesplace an overall cap on consumption ofthese compounds based on their ozone-depleted weights, and gradually reducethe permissible amount allowed underthis cap. The regime also calls for aphaseout of consumption in 2030. Theconsumption cap for each of thedeveloped countries is equal to the sumof 3.1 percent of the country's 1989ODP-weighted consumption of CFCs inGroup I of Annex A and the ODP-weighted level of HCFCs also consumedIn that year. The HCFC restrictions areto begin in 1996, assuming that theCopenhagen Amendments have enteredinto force by that date. The amendmentsfurther call for a 35% reduction underthe cap in 2004, followed by a 65%reduction in 2010, a 90% reduction in2015, a 99.5% reduction in 2020, and atotal phaseout in 2030.

Under a separate Federal Registernotice (58 FR 40048), EPA has requestedthe 1989 HCFC and CFC data it needsto establish the exact level of the capthat would be applicable to the UnitedStates under the Protocol amendments.Once EPA has calculated the UnitedStates' baseline, the Agency shallpublish in the Federal Register theconsumption baseline for the purposesof the Montreal Protocol.

C. CAA Petitions

1. NRDC/FOE/EDFThe NRDC/FOE/EDF petition

requested, among other things, that theAgency accelerate the phaseout ofcertain HCFCs, with the earliestphaseout dates proposed for thosecompounds with the highest ODP.Specifically, the petitionersrequestedthat the production and consumption ofHCFC-22, HCFC-141b, and HCFC-142bbe prohibited from use in newequipment by January 1, 2000. Theenvironmentalist would allow thesecompounds to be available for anadditional 5 years, until January 1, 2005,to service existing equipment.

2. CFC Alliance PetitionTheCFC Alliance Petition proposed

an acceleration of the same compoundsidentified in the NRDC/FOE/EDFpetition, but requested differentphaseout dates. It suggested a January 1,2010 ban on the production and use ofHCFC-22, HCFC-141b, and HCFC-142bin new equipment, with a total phaseoutof these compounds in 2020. Thepetition submitted by the CFC Alliancewas generally supported in commentsprovided by the Association of Home


Appliance Manufacturers and the AirConditioning and Refrigeration Institute.

3. IEER PetitionEER also submitted a petition dated

April 23, 1992 that relates to the issueof controls on class II substances. JEERrequested that EPA: (1) ReclassifyHCFC-22, HCFC-141b, HCFG-142b asclass I substances; (2) recalculate theozone depletion potential of anypartially halogenated substance with anatmospheric lifetime of six months ormore based on its peak contribution toatmospheric chlorine relative to CFC-11following an instantaneous release ofeach; and (3) survey all chlorine-containing substances with anatmospheric lifetime greater than onemonth and list as a class IU substanceany such compound that contributesgreater than three parts per trillion toatmospheric chlorine.

The JEER petition argues that the useof "steady state" ODPs are aninappropriate basis for dealing with therisks associated with variouscompounds. The calculation of an ODPis based on its contribution to ozonedepletion compared to that of CFC-11over a period of roughly 200 years,which is based on the length of timethat CFC-11 would contribute to ozonedepletion. This is referred to as the"steady state" ODP. Since the HCFCshave a considerably shorter atmosphericlifetime, their contribution to the risksof ozone depletion occurs over a periodof a few years to several decades, aperiod far shorter than that of CFC-11.The JEER petition argues that using the"steady state" period of roughly 200years for analyzing the impact of theHCFCs is inappropriate and masks theirnear-term impact. lEER contends that,most importantly, since the risks ofozone depletion are greatest over thenext decade or so when atmosphericchlorine and bromine levels are likely topeak and then begin to decline, EPAshould alter its method of calculatingODPs to that proposed by the petitionerand list compounds as class I or IIsubstances based on this modifiedapproach.

4. EPA's Proposed ActionIn its proposal, EPA addressed both

the Copenhagen Amendments and theissues raised in the NRDC/FOE/EDF andCFC Alliance petitions. The proposalincorporated several key conceptscontained in these petitions, includingdistinguishing among HCFCs based ontheir ODP and phasing out use in newequipment prior to use for servicingexisting equipment. The proposal didnot explicitly follow the cap approachadopted internationally under the

Copenhagen Amendments, but insteadcontained specific timetables for thephaseouts of each compound that EPAexpects will result in full compliancewith the phased reductions called for bythe Protocol Amendment.

The proposal set forth the followingschedule for HCFC reductions: byJanuary 1, 2003, all production andconsumption of HCFC-141b would beeliminated; by January 1, 2010,production and consumption of HCFC-22 and HCFC-142b would be frozen atbaseline levels and virgin material couldonly be used only as a feedstock or asa refrigerant in appliances manufacturedprior to January 1, 2010; by January 1,2015, baseline production andconsumption of all other HCFCs wouldbe frozen and all uses of virgin

roduction of these materials would beanned except for use as a feedstock or

as a refrigerant in appliancesmanufactured prior to January 1, 2020;by January 1, 2020, production andconsumption of HCFC-22 and HCFC-142b would be prohibited; and byJanuary 1, 2030, production andconsumption of all other HCFCsubstances would be banned.

In this proposal, the Agencydiscussed at length the basis foraccelerating the phaseout of HCFCs torespond to increased risks of ozonedepletion. It also described its rationalefor rejecting the earlier phaseout datesrequested in the NRDC/FOE/EDFpetition. EPA's rationale focusedprimarily on the fact that alternatives tomany of the HCFCs have not yet beendeveloped to the point that the Agencycould determine that commercializationwould be feasible on a faster timetable.The Agency views HCFCs as importantinterim substitutes that will allow forthe earliest possible phaseout of CFCsand other Class I substances. However,the Agency believes that the use ofHCFCs should be limited to only thoseapplications where otherenvironmentally acceptable alternativesdo not exist. EPA has proposedlimitations under its section 612rulemaking (Significant NewAlternatives Policy Program) toimplement this approach. 58 FR 28094(May 12, 1993).

By distinguishing between HCFCsbased on their relative contributions toozone depletion, the Agency has alsosought to minimize risks associatedwith the use of HCFCs. In particular, theearly phaseout date for HCFC-141b wasproposed because its ODP issubstantially greater than any other ofthe HCFCs. Similarly, in allowing until2030 for the phaseout of HCFC-123 andother HCFCs with very low ODPs. theAgency's proposed action reflected the

fact that these compounds willcontribute substantially less to the risksof ozone depletion.

The Agency's proposal also explainedin detail the rationale behindimplementing a regulatory scheme thatdiffered in approach from that adoptedby the Protocol. The Agency explainedthat the cap approach adopted in theProtocol could create unworkableadministrative problems in allocatingallowances and that its proposed regimebuilt on activities (e.g., HCFCproduction and use plans) already wellunderway and would be less disruptiveand provide greater certainty forindustries moving aggressively out ofclass I substances.

Most importantly, the proposalexplained the basis for the Agency'sbelief that its regulatory scheme wouldensure compliance with the UnitedStates' obligations under the MontrealProtocol. The Agency presenteddetailed, sector-by-sector, analysis oflikely uses of HCFCs and determinedthat based on conservative assumptions,total use within the United States underits proposal would not exceed the limitsestablished in the Protocol.

5. Response to lEER PetitionWhile EPA's March 18, 1993 proposal

on class II substances addresses many ofthe issues raised in the lEER petition,the Agency did not explicitly respond tothe petition in the context of thatproposal. In doing so here, the Agencybelieves it is important to addressdirectly the issues raised by lEERconcerning the listing of several HCFCsas class I substances and the method ofcalculating ODPs.

As discussed above, the IEER petitionrequested that the Agency shift itsmethodology in calculating ODPs fromthe "steady state" calculations that havetraditionally been used by EPA underthe Clean Air Act and under theMontreal Protocol to a calculation basedon the ODP at the time of a compound'speak contribution to atmosphericchlorine or bromine. The rationalebehind this proposal is that an ODPcalculated in this manner betterrepresents the risks of ozone depletionassociated with compounds that haverelatively short atmospheric lifetimesand that this approach is particularlyappropriate given that atmosphericchlorine levels, and therefore health andenvironmental risks, are likely to peakaround the turn of the century. The-table below contains ODP calculationsfor different periods of time that haverecently been published in the scientificliterature. It demonstrates the generalpoint made in the JEER petition thatODPs for all of the HCFCs are


substantially higher over the short- thanover the longterm.

SEMI-EMPIRICAL POLAR OZONEDEPLETION POTENTIALS

Time horizon (yrs.)

10 20 100 500

HCFC-22 ........ 0.17 0.14 0.07 0.05HCFC-141b ..... 0.45 0.33 0.13 0.11HCFC-123 ....... 0.19 0.08 0.03 0.02HCFC-142b ..... 0.16 0.14 0.08 0.07

Source: Solomon and Albritton (1992).

The Agency believes that the need toconsider the short-term impacts ofHCFCs on ozone depletion is importantin its decisions to set various controlmeasures for controlled substancesrequired for phaseout. The decision toaccelerate the phaseout of Class Isubstances and to require a fasterphaseout of those HCFCs with a higherODP reflects the Agency's response tothis concern. Indeed, EPA's modelinganalysis accounts for short term effects.Thus, this consideration supports theAgency's decision to phase out HCFC-141b before any other HCFC.

While recognizing the importance ofshort-term impacts on ozone depletionin its regulatory decisions, the Agencyhas decided not to modify the mannerin which it calculates ODPs for thepurposes of regulating compoundsunder the CAA. The Agency believes ithas adequate authority to consider acompound's short-term impact inshaping its regulatory policy withoutsuch a change. For example, incalculating the risks associated withdifferent phaseout schedules andinterim reduction targets, the Agency'sanalytical tools (e.g., modeling ofchlorine and ozone depletion) take intoconsideration both the near-term andlonger-term impacts associated witheach compound. Indeed publication ofan atmospheric lifetime and halogenloading potential reveals these impacts,when considered together with thesteady state ODP. The Agency hasauthority under section 602 to addsubstances to the class I and U listsbased on their overall harm to the ozonelayer and under section 606 toaccelerate the phaseout of class IIsubstances in the light of'these impacts.

The Agency believes that changingthe calculation methodology for ODPsas IEER suggests would conflict with theAgency's goals in protecting againstozone depletion which reach beyondsimply reducing the near-term risks.The Agency and the Montreal Protocolalso have as an important goal restoringozone to the levels existing before the

onset of the Antarctic ozone hole. Toachieve this goal, it is necessary to alsoreduce the use of the compounds withlonger atmospheric lifetimes and veryhigh ODPs, including the CFCs andcarbon tetrachloride. To the extent thatthe availability of HCFCs allows for theaccelerated phaseout of CFCs, their usecontributes to this important objective.(For several important uses of CFCs,HCFCs are currently the only availablealternatives.) Changing the method forcalculating ODPs could limit theAgency's flexibility to allow continueduse of certain HCFCs as transitionalsubstitutes for the CFCs.

Furthermore, the Agency has decidednot to modify its method for calculatingODPs because of two potentiallyimportant inconsistencies that such achange would create. First, the 0.2threshold in section 602 for listing aclass I substance was specified byCongress on the basis of a steady stateCDP. Since this level is fixed in theCAA, shifting to short-term ODPs fordetermining whether a compoundshould be listed would produceunintended results, While the Agencyalways has the flexibility to addsubstances to the class I list based onsignificant contribution to ozonedepletion, considering all relevantin formation, the Agency believes the 0.2mandatory listing threshold wasestablished with a steady-state ODPconcept in mind. Congress itselfassigned steady state ODPs in section602, Table 1. While the Agency isauthorized to adjust the Table 1 ODPs.The numbers Congress assignedindicates that the 0.2 threshold wasintended to represent a steady stateODP. Furthermore, Congress explicitlycalled on the Agency to use steady stateODPs as the basis for evaluating impactsinstead of using chlorine loadingpotentials, even though the concept ofchlorine loading was recognized at thetime the legislation was adopted andEPA is required to publish acompound's chlorine loading potentialunder section 602(e).

Congress' understanding that ODPsare calculated as a "steady state" isclearly reflected in the legislativehistory, as is Congress's intent thatchlorine and bromine loading potentialsbe published to allow analysis of"future peaks and rates of increase ordecline." See Senate Committee Report,Report No. 101-228, 101st Cong., 1stSess., at 389 (December 20, 1989)(hereinafter "Senate Report")("ODPs * * * reflect the relativechronic ozone destruction * * * of asubstance after nearly constantemissions for a century.:ODPs * * * do not clearly reflect the

contribution of different halocarbons tothe amount of chlorine in theatmosphere over the next decade andbeyond.").The second reason the Agency has

elected not to modify the way itcalculates ODPs is that section 602(e) ofthe CAA requires that the ODPs used bythe Agency be consistent with theMontreal Protocol. The Agency,therefore, believes the steady stateapproach must be used to assign ODPsunder the CAA in order to be consistentwith the steady state approach usedunder the Montreal Protocol'sCopenhagen Amendments, at leastwhen those Amendments to theProtocol enter into force (likelysometime in 1994). Even before theAmendments enter into force, theAgency believes it would beinappropriate for EPA to adopt one setof values now only to have to changethem within the next several monthswhen the Copenhagen Amendmentsentered into force for the United States.

Short-term ODPs were discussed aspart of the Scientific Assessment reportto the Montreal Protocol Parties andtherefore were before the Parties as anoption to be adopted. However, neitherthe Scientific Assessment Panel nor theParties themselves recommended oreven considered any proposal to shiftthe calculation of ODPs from a steady-state to a short-term basis. Despite beingexplicitly included in the ScientificAssessment report the Parties rejected ashift to short-term ODPs primarilybecause they view as the objective of theProtocol both the near-term reduction ofrisks and the longer-term return of theatmosphere to pre-Antarctic ozone holeconditions. A shift to short-term ODPsmight compromise the longer-termobjective.

EPA believes, for the reasonsdiscussed above, that to adopt anapproach to ODPs that the ScientificAssessment Panel and the Partiesrejected would be "inconsistent" withthe Montreal Protocol and therefore inthese circumstances in conflict withsection 602(e).

While EPA has rejected lEER's requestfor modifying the way it defines andcalculates ODPs for assignment underthe CAA, the Agency notes that if it haddone so, very little would change in itsregulatory program. Of the threecompounds that IEER requested beshifted to class I status (HCFC-22,-141b, -142b), only HCFC-141b wouldappear to exceed 0.2 based on the 10-20 year lifetimes calculated in thescientific literature and based on thecalculations made by IEER using its"peak" approach. Thus, if the Agencywere to proceed today to propose listing


HCFC-141b and allowed the full sevenyears extension time permitted undersection 602(d) based on what isattainable, it would require a phaseoutin 2002, only one year earlier thantoday's final action provides. The othercompounds (HCFC-22 and -142b) haveshort-term ODPs below 0.2 based on thecalculation contained in the scientificliterature and therefore would not haveto be added to the class I list based onthe assigned ODP alone.

EPA also does not believe that theaddition of these HCFCs to the class Ilist can be justified independently onthe basis that they "contributesignificantly" to ozone depletion. EPAbelieves that the use of these HCFCcompounds will allow for theaccelerated phaseout of CFCs in severalimportant sectors and thereforefacilitates rather than increasesreduction in both short-term and to agreater extent long-term risks ofdepletion.

The final request in the IEER petitioninvolves a review of other partiallyhalogenated substances to determine ifthey contribute to ozone depletion andif they should be listed as class IIsubstances. While EPA has notconducted an exhaustive review of allother halogenated compounds, itbelieves that the limited data availablefor such high-volume chlorinatedcompounds as perchloroethylene andmethylene chloride support the viewthat these compounds have very shortatmospheric lifetimes (e.g., much -shorter lifetime than any of the HCFCs)and therefore do not contribute in anysignificant way to ozone depletion.

6. Today's Final ActionHCFC restrictions and the approach

included in today's final rule have notchanged from those proposed by theAgency in March. EPA receivedcomments from several groups ondifferent aspects of its proposal. Ingeneral, these comments supported thegeneral approach taken by the Agencyin implementing the Montreal Protocol'srestrictions on HCFCs. These commentssupported the Agency's proposal tophase out compounds based on theirrelative ODPs with the compounds withhigher ODPs phased out earlier thanthose with lower ODPs. Comments alsogenerally supported the decision tophase out consumption in newequipment prior to that for servicingexisting equipment. Comments stronglyopposed using an allowance allocationor auction to more directly implementthe cap approach adopted in theProtocol.

Several commenters, however, arguedfor earlier phaseout dates for several of

the HCFCs. These commenters arguedthat EPA's proposal would allow toolong a period for the use of HCFCs. Forexample, these comments suggested thatHCFC-141b could be phased out earlierin foam and HCFC-22 could beeliminated at an earlier date inrefrigeration applications. Othercommenters argued that whilealternatives might be feasible by theproposed dates, it was still too early totell if they would be and that theAgency should build in additionalflexibility to allow use to continue fora longer period of time in the eventalternatives do not become available.While EPA intends to monitor closelythe development of alternatives, it hasdecided against either requiring anearlier phaseout date for these HCFCs orallowing greater flexibility by extendingthe dates. The Agency believes that,critical research into alternatives,particularly for HCFC-141b in foam andin limited solvent applications andHCFC-22 in refrigeration andairconditioning is currently on-goingand should result in the availability ofsubstitutes by the dates contained in theHCFC phaseout schedule. Whilepromising alterhatives for thesecompounds are currently in early stagesof evaluation, considerably moreproduct testing and energy efficiencyevaluations are required. Anyconclusions concerning earlieravailability or commercialization ofthose alternatives would currently bepremature.

Issues related to HCFCs are alsoundergoing further review by the Partiesto the Protocol. A new scientific andtechnical assessment of relevant issuesshould be available in late 1994 and willbe used by the Parties in reviewing itscurrent HCFC limitations in 1995. EPAbelieves that any further actionsregarding HCFCs should await theoutcome of that process.

Finally, in the proposed regulation,EPA restricted both the production andconsumption of the specific HCFCcompounds at specified dates. TheAgency receivedcomments stating thatthe Montreal Protocol provision onHCFCs restricted only consumption ofHCFCs, defined in the Protocol as theamount produced plus the amountimported minus the amount exportedand that EPA should similarly restrictonly consumption.

Section 602(c) of the Clean Air Actrequires that EPA restrict productionand consumption of class II substanceson the same schedule. Furthermore,EPA believes that, even if authorized bythe Act, it could not adopt final rulesrestricting only consumption withoutrequesting public comment on the

approach since it would represent asignificant departure from the proposal,which dealt with both production andconsumption.

Moreover, EPA notes that,notwithstanding the productionphaseout, section 605(d)(2) of the CAAallows for continued export of HCFCs todeveloping countries that are Party tothe Protocol for their basic domesticneeds through 2040. While the sectionprovides a cap on the amount beyondthe baseline permitted for such experts,as noted earlier, EPA is deferring fornow the establishment of any specificbaseline levels for HCFCs.

EPA proposed quarterly reporting ofall HCFC production and use in order tomonitor compliance with the MontrealProtocol. Several commenters objectedto quarterly reporting, stating that suchreporting was burdensome. However,EPA continues to believe that quarterlyreporting is necessary. EPA hasdeveloped an approach to limit HCFCsby targeting for phaseout the high ODP-weighted HCFCs. By accelerating thephaseout of HCFC-141B, HCFC-142Band HCFC-22, EPA believes it will meetits obligations to the Montreal Protocol.However, the Agency must receiveHCFC production and consumption data(i.e., imports and exports) quarterly toensure U.S. compliance. If it shouldappear that the United States is toexceed its limits, EPA may act to ensurethat compliance is maintained.Although there may be severalapproaches that EPA may use to controlproduction and consumption underthese circumstances, it is likely thatEPA would resort to rulemaking duringthis period, including the use, ifnecessary, of a direct or interim finalrule. For this reason, EPA will requirequarterly reporting of productionimports and exports of HCFCs. With thisdata EPA can monitor nationalconsumption of these data. (EPA doesnote that to date companies have alwayssignificantly underproduced theirallowable level).

Although the March 18 Notice statedthat EPA proposed to require use data,the Agency will not require informationon use from the user sectors. EPAbelieves that only data on productionimports and exports are required at thistime.

IV. Addition of Methyl Bromide to Listof Class I Substances and PhaseoutSchedule

A. SummaryBased on recent scientific assessments

and the most recent actions by theParties to the Montreal Protocol, EPAproposed on March 18, 1993 to list


methyl bromide as a class I substanceunder section 602(c)(3) of the Clean AirAct; and to phase out production andconsumption of this substance by theyear 2000. This was in response to apetition filed on December 3, 1991 byNatural Resources Defense Council,Friends of the Earth, and theEnvironmental Defense Fund (hereafterreferred to as NRDC/FOE/EDF petition).

As part of that proposal, EPA rejectedthe more stringent phaseout scheduleproposed by the petitioners, based onthe lack of available substitutes in thenear-term. Instead, EPA proposed afreeze in production and consumptionof methyl bromide beginning on January1, 1994 at 1991 levels, no interimreductions, and a phaseout by the year2000. In addition, the Agency proposedthat ozone depletion warning labelsrequired under section 611 of the CleanAir Act for products "manufacturedwith" ozone-depleting substances doesnot apply to agricultural products, suchas fruits and vegetables. See, Responseto Comments on section 611 labelingrulemaking.

EPA received 560 comments on themethyl bromide aspects of its March18th proposal. The large majority ofcomments were from members of theagricultural community and generallyraised scientific issues regarding theozone depletion potential (ODP) ofmethyl bromide, the lack of alternatives,and the economic impact of phasing outthe production of this compound.

Today's final action examines indetail the issues raised by thesecomments, and adopts an approach that,consistent with the ozone layerprotection requirements of the Clean AirAct, responds to the current state ofscientific understanding concerning thiscompound. The regulatory schedule(freeze without interim reductionsfollowed by the required phaseout of thecompound), fully utilizes the limitedflexibility permitted by the statute.

Specifically, today's final action listsmethyl bromide as a class I substancewith an ODP of 0.7 as specified in thelatest Montreal Protocol internationalscientific assessment and as agreed to bythe Parties to the Protocol at theirmeeting in Copenhagen in November1992. The final rule does not requireany interim reductions and provides thelopgest possible period (7 years or untilJanuary 1, 2001) allowed under section602 for the phaseout. Finally, for thereasons explained in the proposal, EPAis interpreting "manufactured with" insection 611 to mean "the mechanical orchemical transformation of materialsinto new products or to assemblecomponent products" and to excludeagricultural processes. Agricultural

products for which methyl bromide isused thus need not be labeled undersection 611.

B. J.gal Authority

1. CAA Legal AuthorityUnder section 602(a), EPA is to add to

the list of class I substances anysubstance that the Administrator findscauses or contributes significantly toharmful effects on the stratosphericozone layer, including all substancesthat the Administrator determines havean ozone depletion potential of 0.2 orgreater.

Under section 602(e), simultaneouslywith any addition to the class I list, theAdministrator shall assign to each listedsubstance a numerical valuerepresenting the substance's ozonedepletion potential. In addition, theAdministrator shall publish the chlorineand bromine loading potential and theatmospheric lifetime of each listedsubstance. Section 601(10) of the Actdefines ODP as "a factor established bythe Administrator to reflect the ozonedepletion potential of a substance on amass per kilogram basis, as compared tochlorofluorocarbon-11 (CFC-11)," andgoes on to state that "such factor shallbe based upon the substance'satmospheric lifetime, the molecularweight of bromine and chlorine, and thesubstance's ability to be photolyticallydisassociated, and upon other factorsdetermined to be an accurate measure ofrelative ozone depletion potential."

Section 602(e) also states that"[wlhere the ozone depletion potentialof a substance is specified in theMontreal Protocol, the ozone depletionpotential specified for that substanceunder the subsection shall be consistentwith the Montreal Protocol." When theCopenhagen amendments to theMontreal Protocol, which include theODP for methyl bromide as 0.7, enterinto force for the United States, thisstatutory provision will apply formethyl bromide.

Under section 602(c)(3), any personmay petition the Administrator to add asubstance to the list of class Isubstances. Such a petition is to includea showing by the petitioner that thereare data on the substance adequate tosupport the petition.Also, section 604 authorizes EPA to

promulgate regulations phasing out theproduction of class I substances frombaseline levels, in accordance with theschedule specified In that section. The"baseline year" is defined in section601(2)(C) to mean a representativecalendar year selected by theAdministrator in the case of substancesadded to the class I list. Section 607

authorizes EPA to promulgateregulations providing for productionand consumption allowances of class Isubstances.

Under section 602(d), for a newlylisted class I substance (such as methylbromide), the Administrator may extendany schedule or compliance deadlinecontained in section 604 if that scheduleis unattainable considering when it isadded to the list. But the provisionspecifies that no extension under thatsubsection may extend the phaseout toa date more than 7 years after January1 of the year after the year in which thesubstance is added to the class I list AsEPA is adding methyl bromide to theclass I list in 1993, the phaseout datemay not be extended beyond January 1,2001.

2. Public Comments on Legal Issues

While many commenters argued thatEPA should delay action until scientificuncertainties are resolved, the Agencyreceived few comments specificallyquestioning its legal authority to actunder title VI of the CAA.

The Methyl Bromide Working Group(MBWG) provided the only extensivecomments questioning the Agency'slegal authority to list methyl bromide.Its comments stated that EPA's onlynondiscretionary action was to respondto the petition by NRDC/EDF/FOE andthat a more appropriate response wouldbe to deny the petition on the basis ofscientific uncertainty and instead toissue a "tentative, non-binding ODPrange for methyl bromide-withoutlisting it as a class I substance".

In making this argument, the MBWGargued that the ODP listed in the reportissued by the Montreal Protocolassessment panel (Methyl Bromide: ItsAtmospheric Science, Technology andEconomics, Montreal ProtocolAssessment Update, June 1992;hereafter referred to as AssessmentUpdate) should not be the basis for U.S.domestic regulatory action and that EPAis required to undertake its ownevaluation of this compound's ODP.

EPA has thoroughly reviewed theissue of whether a range of values forthe ODP would be more appropriatethan the 0.7 value contained in itsproposal. As explained in detail below,in the context of this review the Agencyhas considered the statutory languageand treatment of ODPs, the actionstaken by the Parties to the MontrealProtocol, the Scientific AssessmentUpdate, and other relevant scientificinformation. Based on'this review, theAgency has determined that a listing ofmethyl bromide with an ODP of 0.7 iswarranted.


Section 602(e) of the Clean Air Actaddresses the impact of the Protocol'sODP on EPA's regulatory obligations.When the Protocol enters into force,EPA must assign an ODP "consistentwith the Montreal Protocol." Thecommenter argued that a range of valuesincluding the one adopted by theProtocol would be legally valid. TheAgency notes, however, that the Partiesto the Montreal Protocol expresslyconsidered adopting a range of valuesfor the ODP of methyl bromide andrejected this approach. EPA believesthat adoption of such a range would,under these circumstances, beinconsistent with their action.

The Protocol's Scientific AssessmentUpdate on methyl bromide alsoconsidered a range of values (from .25to 1.11) for the ODP but offered in theirreport a single value for the ozonedepleting potential for methyl bromide.While both the experts involved in theassessment panel and the Parties to theProtocol recognize that the calculationof ODPs for all controlled substancesinvolves some degree of uncertainty, theParties have nonetheless alwaysadopted a single value for each specificcompound. This approach hashistorically been used because of theneed to use the "calculated level" ofproduction and consumption for agroup of compounds, but has also beenadopted in the case of methylchloroform and carbon tetrachloride,which are single compounds in distinctgroups similar to methyl bromide.

Section 602(e) of the CAA alsoprovides single values for the ODP ofeach listed substance in Table I andstates that the Agency shall assign "anumerical value representing theiubstance's ozone depletion potential."(Emphasis added) Scientific uncertaintyis inherent in assigning any ODP, andEPA has concluded that scientificuncertainty in the case of methylbromide does not warrant a differentapproach to assigning ODP.

The Parties to the Protocol willreconsider the ODP of methyl bromideat their 1995 meeting based on anupdate by the scientific assessmentpanel and could at that time recommendmodification. Should such a changeoccur, EPA would also reconsider theODP assigned to methyl bromide underthe Clean Air Act.

EPA's legal obligation under section602(e) to assign an ODP to methylbromide consistent with that specifiedin the Montreal Protocol technicallywill not arise until the CopenhagenAmendments to the Montreal Protocolenter into force. Those amendments areto enter into force on January 1, 1994,provided that twenty Parties have

ratified the amendments by that time.Otherwise, the amendments will enterinto force 90 days after the twentiethinstrument of ratification is depositedby a Party. As of September 1993, sevenParties have deposited their instrumentsof ratification.

EPA also believes that the bestscientific evidence currently availablesupports assigning methyl bromide anODP of 0.7. This evidence is addressedin the Scientific Assessment Panel'supdated assessment report on methylbromide. The world's leading experts onthis issue prepared and peer reviewedthis report, and it represents the bestavailable scientific analysis for EPAevaluation and a sound basis for EPAaction. A detailed discussion of thescientific issues surrounding methylbromide's ODP is presented below.

Finally, EPA has also examinedclosely the scientific issues raised by theMBWG and others in the comments andaddresses these concerns in detailbelow. Based on this review and for thereasons stated above, EPA has rejectedthe Idea of using a range of value for theODP of methyl bromide.

The MBWG contends that EPA hasfailed to demonstrate that methylbromide "contributes significantly toharmful effects on the stratosphericozone layer" under section 602(a).Section 602(a) of the Clean Air Actspecifies that the Administrator shalladd to the class I list all substanceshaving an ODP of 0.2 or greater. SinceEPA has concluded that methylbromide's ODP exceeds this threshold,application of the less objective"contributes significantly" standard isunnecessary. In any case, however, EPAbelieves the best current scientificevidence clearly supports addingmethyl bromide to the class I list underthis standard, as well. It is noteworthythat, because methyl bromide has arelatively short atmospheric lifetimerelative to CFC-11, the 0.7 ODPunderstates the near-term damagemethyl bromide causes in comparison tothe CFCs. As explained below, the 0.7ODP reflects the comparative damage ofmethyl bromide and CFC-11 over a 200-year time period. Over a 10-year timeperiod, the best estimate of methylbromide's ODP would be 7. This short-term ODP i vastly higher than anyother substance not currently on theclass I list, and thus supports differenttreatment than that accorded such othersubstances (See discussion of lEERpetition and HCFCs above.) Therefore,methyl bromide's near-termcontribution to ozone depletion over thenear-term is much higher than even the0.7 ODP suggests. The Protocol's

Assessment Update Report reflects thisperspective:

"These model results suggest thatanthropogenic emissions of (methylbromide) could have accounted forabout one-twentieth to one-tenth of thecurrent observed ozone loss of 4-6%.and could grow to about one-sixth of thepredicted loss by the year 2000 ifemissions continue to increase at thepresent rate of about 5-6% per year."

While uncertainties affect this andany model calculations about ozonedepletion, this statement furthersupports the conclusion that, absentsteps under the Protocol to limitemissions, man-made methyl bromideplays a significant role in ozone layerdamage.

The MBWG next contends that "priorto imposing any ban EPA is obligated todemonstrate, with a high measure ofcertainty, that termination of thisproduct will be attainable," butprovides no legal basis for thisobligation. As discussed in the preambleto the March 18 proposal, EPA believesthat the Clean Air Act requires that allsubstances that the Administratordetermines have an ODP of 0.2 or abovebe added to the class I list, withoutregard to whether a phaseout isattainable. The Clean Air Act separatelyallows EPA to extend the phaseoutschedule under section 602(d) for aseven-year limited time if the otherwiseapplicable phaseout schedule isunattainable, considering when thesubstance ir added to the list. Indeedthe specific limitation of the extensionauthority to seven years confirms thatthe issue of whether a phaseout isattainable is not relevant to EPA'sdecision whether to add the substanceto the class I list.' The MBWG further states that EPA'sfailure to consider the availability ofsubstitutes in setting the phaseout datemakes EPA's decision "legally flawed."As discussed extensively in theSreamble to the proposal, the Agencyelieves that, under section 602(c),

methyl bromide's significantcontribution to stratospheric ozonedepletion, and its ozone depletionpotential, constitute a sufficient basisfor adding this substance to the class Ilist While the ultimate phaseout ofmethyl bromide is a consequence of thislisting, the Agency does not belteve ithas authority to consider the economicimpact of the phaseout in determiningwhether to add methyl bromide to thelist.

At the same time, however, theAgency believes that economic impactsare relevant to its decision whether toextend the section 604(a) statutoryschedule under section 602(d). As


explained in the proposal, the Agencymay extend the section 604(a) phaseoutschedule within specified limits if it isunattainable, considering when the newsubstance is added to the class I list.The economic impact of a phaseout isintegral to the question of whether aphaseout is "unattainable." Based onthe unavailability of substitutes formethyl bromide, EPA has concludedthat near-term reductions areunattainable and that a freeze onproduction and consumption is themost stringent interim reductionschedule that can be established. Assection 602(d) specifically limits EPA'sauthority to extend the phaseoutschedule to seven years following theyear methyl bromide is added to theclass I list, EPA may not extend thephaseout date past January 1, 2001(assuming listing in 1993). EPA does notbelieve it has discretion to furtherextend this phaseout date based oneconomic impacts.

EPA proposed to extend the scheduleuntil January 1, 2000, rather thanJanuary 1, 2001. EPA gave two reasonsfor this position. First, the Agencyexplained that it did not believe thephaseout should be extended beyondthe January 1, 2000 final terminationdate specified in section 604 for class Isubstances absent an affirmative basis tobelieve that termination will beunattainable at that time. Second, EPAexplained that it would not have hadauthority to extend the phaseout beyondJanuary 1, 2000, had the Agencycomplied with the statutory schedulefor responding to the petition to addmethyl bromide to the class I list.

Several commenters urged the Agencyto extend the final phaseout date untilJanuary 1, 2001 as allowed undersection 604. These commenters statedthat the additional year is importantgiven the limited time currentlyavailable to develop alternatives and tohave these alternatives approved for useby the required regulatory agencies. EPAagrees with these commenters that theAgency cannot now conclude that theseconsiderations will be any lessimportant in the year 2000 than in theyears prior to that time. Thus, EPA nowbelieves that these considerations justifyextending the freeze until the 2001phaseout. Of course, as noted in theproposal, EPA will, in cooperation withthe Office of Pesticide Programs and theUSDA, monitor the availability ofsubstitutes and could accelerate thephaseout or establish interimreductions, if justifiable based on futureinformation.

The MBWG also stated in its commentthat section 612(a) of the Act "requiresEPA to ensure that its regulatory

decisions under subchapter VI actionsdo not result in increased risks to healthand the environment." Section 612(a)requires EPA "to the maximum extentpracticable" to take steps to ensure thatmore harmful substances are not used toreplace class I and 11 substances. But theAgency's decision to list a substancewhich is to be determined solely basedon the criteria specified in section602{a), which does not include such ageneral risk standard.

C. Background

1. Initial Identification of Risks ofMethyl Bromide

Action to list methyl bromide as aclass I substance can be traced back tothe international scientific assessmentprepared in 1991 for the Parties to theMontreal Protocol Article 6 of theMontreal Protocol calls for a periodicassessment of scientific, economic,technical, and environmental issuesrelated to ozone depletion. The 1991Scientific Assessment Report issued inDecember 1991 first Identified methylbromide as a potential significantcontributor to ozone depletion andlisted the ozone depletion potential ofthis compound at 0.6.

2. Petition To ListFollowing the publication of the

assessment, NRDC/FOE/EDF petitionedEPA on December 3, 1991, requestingamong other things that the Agency addmethyl bromide to the list of class Isubstances under section 602{c) andphase out its production andconsumption on an accelerated basisunder section 606. It also requested thatthe Agency take emergency action undersection 303 to reduce methyl bromideproduction in 1992 by 50 percent, witha total phaseout by January 1, 1993.

Because section 602 provides atimetable for responding to petitionsand because no imminent hazard wasinvolved, EPA rejected the petitioners'request for emergency action undersection 303 and otherwise responded tothe petition in its March 18, 1993,Federal Register proposal.

Section 602(c)(3) specifies that within180 days of receiving a petition, EPAshall either propose to add thesubstance to the list of class I or IIsubstances or publish an explanation ofthe reason for denying the petition. Ifthe decision is to propose listing, EPAis given one year after receipt of the

etition to add the substance to the listy rule, or make a final determination

not to add the substance to the list. EPAproposed to add methyl bromide to theclass I list on March 18, 1993 (58 FR15014). Today's notice constitutes final

action granting the petition to addmethyl bromide to the class I list.

3. Montreal Protocol Actions

The Montreal Protocol Parties at theApril 1992 meeting of the Open-EndedWorking Group began discussions on,possible changes to the Protocol basedon the 1991 assessment reports. At thismeeting, the United States firstproposed adding methyl bromide to theMontreal Protocol based on theconcerns raised in the ScientificAssessment Report. The U.S. proposedto phase out production andconsumption by the year 2000. In aneffort to provide more detailedinformation for the Parties to consider,the Open-Ended Working Group calledon the Chairman of the AssessmentPanels to provide additionalinformation on both scientific andtechnical/economic issues related tocontrols on methyl bromide.

In response to this request, the Panelsprepared an update of the scientificassessment report that focusedspecifically on methyl bromide. Thereport drew extensively from materialpresented at a two-day scientificworkshop organized by the MethylBromide Global Coalition and held onJune 2-3, 1992 in Washington, DC.

The resulting Protocol AssessmentUpdate report concluded that, whilesubstantial uncertainties exist, thecurrent best estimate of the ozonedepletion potential of methyl bromidewas 0.7 (revised upward from 0.6contained in the initial ScientificAssessment Report). Furthermore, itconcluded that if man-made emissionscontinued at current rates of increase,atmospheric models predict that man-made methyl bromide would accountfor 5-10 percent of current depletionand one-sixth of depletion in the year2000. The report identified as key areasof uncertainty such factors as thepotential for additional sinks for methylbromide and the possibility of thecompound breaking down in theatmosphere into less reactive species.These uncertainties are discussed in thesection on scientific issues below.

A workshop to review technicalissues concerning the use andavailability of substitutes for methylbromide was held from June 16-18,.1992, also in Washington, DC. Theworkshop was attended by over 90experts from 20 countries and includedsessions on each of the key areas of useof this compound. It concluded that useof methyl bromide could be reducedsubstantially, but that no singlealternative exists as a substitute for alluses of methyl bromide and that

65032 Federal Register / Vol. 58, No. 2'36 / Friday, December 10, 1993 / Rules and Regulations

alternatives for some important uses donot currently exist.

A report summarizing the findings ofboth the scientific and technicalworkshops was prepared, thoroughlypeer reviewed, and issued by theChairman of the Assessment Panels (Dr.Robgrt Watson), "Methyl bromide: ItsAtmospheric Science, Technology andEconomics" in June 1992 (referred tohere as Assessment Update). The reportserved as the basis for continueddiscussions among the Parties to theProtocol concerning the possibility ofaction to restrict production andconsumption of methyl bromide.

At the Fourth Meeting of the Partiesto the Montreal Protocol held inNovember 1992 in Copenhagen, theissue of what action, if any, to take onmethyl bromide was widely debated. Anumber of nations, including Israel andmany developing countries, maintainedthe position that the scientific evidencewas so uncertain and the economicimpact potentially so great that anyaction at this time to add this compoundto the Protocol was premature. Theyadvocated that the Parties should agreeonly to undertake additional studies toevaluate the need for and the nature ofany future action. In contrast, theUnited States and many developednations argued that action to restrictmethyl bromide would make asignificant contribution to global effortsto protect the ozone layer and thatrestrictions now on the production andconsumption of this compound with anexemption for essential uses would bethe appropriate course of action. TheUnitedStates proposed phasing out thecompound in the year 2000 while othernations favored either a near-term freezeor freeze with a reduction step.

The Parties to the Protocol reached aconsensus decision with the adoption ofan amendment calling for a freeze onmethyl bromide production andconsumption beginning in 1995 at 1991levels with an exemption for quarantineand preshipment applications. TheParties also agreed that in addingmethyl bromide to the list of controlledsubstances as Annex E, that it should belisted with an ozone depletion potentialof 0.7.

In addition, the Parties unanimouslyadopted a non-binding resolution urgingnations to take all steps to reduceemissions of methyl bromide and urgingthe Parties to take further steps to agreeon reductions and an appropriatephaseout date based on the next roundof Protocol assessments. The scientificand technical assessments have alreadybeen initiated and are due to becompleted in November 1994. They willserve as the basis for further decisions

by the Parties to be taken at their SixthMeeting in 1995.

4. Domestic Regulatory ActionAs part of its efforts to develop

information to respond to the petitionby the environmental groups to listmethyl bromide as a class I substance,on July 27, 1993, EPA issued a requestfor information under section 114(a) ofthe Clean Air Act. This letter was sentto key industry and governmentorganizations that potentially had usefulinformation on the uses of methylbromide, emissions from those uses, theavailability of alternatives, andscientific information concerning theozone depletion potential and impact ofmethyl bromide on the ozone layer.

EPA received responses from a broadspectrum of the agricultural communitywhich provided useful information onthe uses of methyl bromide and thedifficulties in identifying viablealternatives. Many of the respondentsalso questioned the scientific basis forlinking their use of methyl bromide toozone depletion and urged the Agencyto delay action pending greaterscientific certainty.

On March 18, 1992, EPA responded tothe NRDC/EDF/FOE petition in thecontext of its proposed rule. The keyelements of that proposal as it related tomethyl bromide are the following:-Methyl bromide would be added to

the list of class I substances and itsODP would be listed as 0.7.

-Production and consumption of thecompound would be frozen at 1991levels beginning on January 1, 1994and phased out by January 1, 2000.

-No interim reductions in productionand consumption were included inthe proposal.

-Methylbromide was established asthe only compound in a newlycreated group six within the list ofClass I substances.

-The labeling provisions under section611 would not apply to agriculturalproducts for which methyl bromide isused need not be labeled undersection 611.EPA believes that its proposal would

minimize the impact on the agriculturalcommunity of listing methyl bromide asa class I substance. EPA proposed toexercise its authority to extend thephaseout schedule under section 602(d)to a freeze as the most stringentschedule for phaseout it could proposein place of the section 604(a) schedule.This extension would providemaximum flexibility for the agriculturalcommunity to Identify and shift toalternatives.

With regard to the ODP of methylbromide, the Agency based its proposal

and its evaluation of the ODP on therecommendations of the Protocol'sScientific Assessment report and itsupdate, and the action taken by theParties to the Montreal Protocol. Asstated above, the Protocol's assessmentupdate report represents the mostauthoritative review of scientificevidence related to methyl bromide'simpact on the ozone layer. While thereport of that group recognized thatimportant uncertainties related to thecompound's ODP remain, theynonetheless provided an estimate of theODP of methyl bromide as 0.7. TheAgency evaluated all the evidenceavailable to it at the time of its proposaland determined that no new oradditional information existed that wasnot available and considered at the timeof the assessment and that supportedreaching any alternative conclusion.The Agency believes the ODP providedfor by that assessment represents thebest current scientific evaluation ofmethyl bromide's ODP. Furtherdiscussion of the scientific basis for the0.7 ODP is contained below.

In proposing to move forward toregulate methyl bromide based on the0.7 ODP, the Agency fully recognizesthat uncertainties remain and thatadditional information will becomeavailable over the next several years andcould alter the ODP contained in futureassessments. To address this issue, EPAclarified in its proposal that it believesit has the authority under section602(c)(1) to delist methyl bromide as aclass I substance in the event that newinformation or future action taken underthe Montreal Protocol shifts the ODPbelow 0.2 and other wise'demonstratesthat methyl bromide does not contributesignificantly to harmful effects on thestratospheric ozone layer, includingnear term effect. EPA explained therationale behind this position at lengthin its proposal (58 FR 15037).Essentially, the Agency believes that therestriction on delisting class Isubstances contained in section602(c)(4) applies only to substancesexplicitly listed in the Act itself byCongress and contained in section602(a). EPA is adding methyl bromide tothe class I list under subsection (c) ofsection 602, and methyl bromide is thusnot explicitly "referred to" insubsection (a). EPA believes it wouldnot be covered under the prohibition,contained in section 602(c)(4), againstremoving a substance from the list.

The Agency reasons that without theability to delist a substance, EPA wouldhesitate to add a substance to the classI list until all uncertainties are resolved,despite much evidence of thesubstance's danger. The chilling effect

Federal Register I Vol. 58. No. 236 / Friday, December 10, 1993 1 Rules and Regulations 65033

of requiring absolute certainty prior tolisting a substance would appear to rundirectly counter to Congressional intentthat the Agency take reasonable steps tosafeguard the ozone layer. Severalrespondents in their comments supportEPA on this interpretation as set out inthe proposal.

hregard to the phaseout schedule,the .proposal set January 1, 2000 as thephaseout date for production andconsumption of this compound. Thisdate was based on language in section602 that requires that any newly listedsubstancebe phased out no later thanseven years after the year in which it isadded to the list of class I substances.The proposal acknowledged that ifmethyl bromide were listed in 1993,that the Agency could postpone itsphaseout until 2001. However, for thereasons explained above, EPA hasdecided to extend the freeze in this finalrule untilJanuary 1, 2001.

The proposal did not require anyinterim reductions in production andconsumption of methyl bromide andinstead jumps directly to the requiredphaseout. In determining the interimschedule prior to the mandated seven-year phaseout, the Agency is authorizedto extend the, schedule in section 604(a)if that schedule is unattainable. In itsproposal, the Agency stated that itbelieved the stringent phasedownschedule in 6041a) is, in fact,unattainable based on the currentavailability of substitutes for methylbromide. While the Protocol'stechnology assessment and EPA's ownreview have identified potentialsubstitutes for many of the major usesof methyl bromide, several years orlonger will likely be necessary to resolvepossile regulatory and commercial

barriers to the widespread use of thesealternatives and to shift to thesesubstitutes in a reasonably cost-effectivemanner. The proposal also stated that anumber of near-term steps were beingtaken to reduce use and emissions andthat these efforts would effectivelyallow for the maintenance of baselineproduction at 1991 levels withoutcreating any significant economicimpact until the year of the phaseout.Finally, the Agency acknowledged thatshould significant technologicalprogress in shifting to alternatives occurprior to the phaseout, then it wouldreconsider theinterim dates if itdetermined that interim reductionswould be achievable. 'The Agencyfurther recognized citizens' optionunder section 6065 to petition theAgency to accelerate the reductionschedule based on future information.

EPA proposed to place methylbromide in a newly created sixth group

within the list 4dclass I substancesrather than adding it toe previouslyexisting group. In proposing thisapproach to listing methyl bromide, theAgency was following the historicalprecedent established both underprevious actions under the Clean AirAct end by the Parties to the Protocol inthe Copenhagen Amendments. Inaddition, EPA has placed methylbromide in a separate group due to itsown phaseout schedule.

In a final issue raised in the proposal,the Agency requested comment onwhether the statute allows for anyexemptions for essential uses from thephaseout of methyl bromide. EPAreceived comments supporting twodifferent positions on this issue. Somecommentars stated that since Title VI issilent on the grant of essential useexemptions for newly listed substances,but allows specified exemptions forcurrently listed substances, that theAgency has the authority to grantexemptions beyond the phaseout datefor any newly listed substances. Othercommenters supported the position thatsince no explicit authority exists andthe exemptions listed in section 604 arenarrowly defined, that 'EPA lacks theauthority to grant essential uses fornewly listed substances such as methylbromide. EPA's response to thesecomments is presented below.D. Todays FinalAction

1. Summary

Today's final rule lists methylbromide as a class I substance with anozone depletion potential of 0.7. Whilerecognizing that scientific uncertaintiesremain, EPA believes that the bestavailable scientific evidence warrantsthis action. In listing methyl bromide asa class I substance in a newlyestablished Group VI, the Agency isfreezing production and consumption at1991 levels for the control periodbegihning on January 1, 1994. Thephaseout of production andconsumption is scheduled for January 1,2001, and no interim xeductions inproduction or consumption are requiredduring the period prior to the phaseout.Consistent with the Agency'sinterpretation of section fill, productsthat utilize methyl brnmide as pad of anagricultural process need not he labeledunder that section.. In taking final action .on the listing ofmethyl bromide at this time, the Agencyseeks to craft a regulatory approach thatis both consistent with the requirementsof the CAA and with past and possiblefuture action by the Parties to theMontreal Potocol Tie Agency haslimited discretion undersection 602 to

decide when and how to regulatecompounds as class I substances. TheAgency is obligated under section 60Z{a)to list any substance the Administratorfinds "cause or contributes significantlyto harmful effects on the stratosphericozone layer" as well as "all substanoesthat the Administrator determines havean ozone depletion potential of 0.2 orgreater." Once listed, the Agency'sauthority to extend the statutoryphaseout schedule is limited to thesituation where that schedule is"unattainable" under section 602(d) andin any event cannot extend beyond 7years. As discussed in the proposaL theAgency believes the sense of thestatutory scheme is that the moststringent attainable schedule should beapplied to the newly fisted substance.See 58 FR at 15034. EPA believes thatmaintaining the freeze level until 2001is the most stringent schedule it canpromulgate. EPA cannot now concludethat any faster phaseout schedule isattainable. EPA has considered theeconomic impact of a methyl bromidephaseout in determining the moststringent schedule of interim reductionsit could promulgate.

EPA does not believe furthertechnology forcing through interimreductions is necessary or appropriate.The Agency believes that it shouKIallow the agricultural community themaximum length of time ander thesecircamstances to -develop and 'implement costeffective alternatives tomethyl bromide. Also, while not strictlyrelevant to what is attainable, theAgency notes that the freeze establishedtoday will avoid any unnecessaryeconomic impact in the unlikely eventthat the scientific understanding ofmethyl bromide's GDP changessignificantly so that it is reduced below0.2 and otherwise meritsreconsideration of the listing based onits contribution to ozone depletion.'

The next Montreal Protocol scientificassessment will be completed inNovember 1994 and the Parties to theMontreal Protocol will again address theissues of methyl bromide limitationsand ODP at their Sixth Meeting in 1995.The Agency will review its action todayin light of future scientific data andinformation, the outcome of the updatedscientific assessment, and any relevantfuture actions by the Parties to theProtocol.

2. Decision 'To ListEPA believes that the scientific

evidence warrants the Agency'sconclusion that methyl bromide's OPis greater than -. 2. and that this is mostconsistent with actiom being takenunder the Montreal Protocol to incl de


methyl bromide's ODP as 0.7. Thus, thestatutory requirements for addingmethyl bromide to the class I list, inEPA's judgment, have been satisfied.Based on the scientific evidenceregarding the ODP and also the evfdencethat methyl bromide's destructiveimpact is concentrated in the near-term,EPA believes this action is both legallysupportable and environmentallyappropriate.

As discussed above in the section on"Legal Authority," EPA believes that thereasoning and conclusions of theMontreal Protocol Scientific Assessmentand its update, and actions by theParties to the Montreal Protocol form anadequate basis for the Administrator'sjudgment that the thresholdrequirements for adding methyl bromideto the class I list have been fullysatisfied. In particular, a key conclusionof the scientific assessment update wasthe following: ". . . model resultssuggest that anthropogenic emissions ofCH3Br (methyl bromide) could haveaccounted for one-twentieth to one-tenth of the current observed ozone lossof four to six percent, and could growto about one-sixth of the predictedozone loss by the year 2000 if emissionscontinue to increase at the present rateof five to six percent per year." Thisconclusion reached by the ScientificAssessment Panel underscores thepotential significant near-term impact ofmethyl bromide on ozone depletion inthe absence of actions to restrictemissions.

This international scientificassessment based on the best scientificevidence available, clearly supports theAgency's conclusion that man-mademethylbromide represents a significantrisk to the earth's ozone layer. TheAgency does not believe thatuncertainty inherent in all ozonedepletion model calculations justifies adifferbnt conclusion or a "wait and see"approach.

Furthermore, the scientific assessmentpanel also established the ODP ofmethyl bromide at 0.7, recognizing thatuncertainties exist and that other factorscould alter the ODP calculation. Thisvalue was adopted by the Parties to theMontreal Protocol at their FourthMeeting as part of the Copenhagenamendments to the Protocol. At the timethese amendments enter into force(likely in 1994), EPA is required bysection 602(e) to adopt an ODPconsistent with that contained in theMontreal Protocol. Prior to that time,EPA believes that, absent a compellingreason to modify the ODP in favor of adifferent value, that it is appropriate tomove forward with the same valuecontained in both the Protocol's

scientific assessment update andadopted by the Parties. EPA hascarefully reviewed the public commentson the science assessment and newlypublished information contained in thescientific literature that relates to theODP and impact of methyl bromide onthe ozone layer. The Agency does notbelieve that a substantial case has beenmade for discarding or overriding theconclusions reached in the Protocol'sAssessment U pdate or to modify on aninterim basis the ODP contained in theCopenhagen Amendments to theProtocol that are likely to enter intoforce next year.

3. Scientific Issues Related to MethylBromide

In the preamble to its proposedregulations, EPA discussed at length thescientific basis for its proposal to listmethyl bromide. Specifically, itpresented the key findings of theMontreal Protocol's ScientificAssessment report and update that dealtwith methyl bromide and thatrepresented the most authoritativereview of these issues. The Agency alsocited the areas of significant scientificuncertainty described in that report,including the possibility of additionaloceanic and terrestrial sinks for methylbromide, the potential for somepercentage of atmospheric reactions tolead to the sequestering of bromine inless reactive compounds (i.e., referred toas Hbr branching) or more reactivecompounds (i.e., increased HOBrformation), and the possibility thatemissions of methyl bromide from man-made activities are smaller thanestimated and that natural sources ofmethyl bromide are larger. EPA receivedextensive comments on each of theseissues, primarily from the MethylBromide Working Group (MBWG).These and other related issues arediscussed in the following sections.

a. Faster Formation of HOBr. Whilediscussed at the scientific assessmentworkshop in June 1992, the conclusionsof the panel in calculating the ODP ofmethylbromide do not take intoconsideration the faster rate constant ofthe formation of HOBr from BrO plusHO 2. This faster measurement differsfrom earlier slower estimates of this rateconstant and now provides ameasurement basis for therecommendation found in thecompendium of rate constantspublished by the Jet PropulsionLaboratory (PL) in 1992. However, the95% confidence limit set forth in thiscompendium still encompasses theslower rate.

The effect of including the fasterreaction would be to raise the ODP of

methyl bromide, all other things beingequal. The impact of including thisfaster reaction rate on the ODP ofmethyl bromide was included in thepublic comments submitted by theMBWG as calculated by Sze et. al. Basedon these model calculations, assuming a2.1 year atmospheric lifetime of methylbromide, the ODP would be increasedfrom 0.64 to 0.85. Assuming a lifetimeof 1.3 years, the ODP would increasefrom 0.4 to 0.53.

EPA recognizes that the evidenceregarding this rate constant appears towarrant an upward adjustment of themethyl bromide ODP from 0.7, whichwas calculated without using this fasterrate constant. However, since theProtocol scientific assessment addressedthis possible faster rate constant as anarea of remaining uncertainty and didnot include it in its calculations, EPAdoes not believe it should adopt anupwardly adjusted ODP for methylbromide as a regulatory matter at thistime. Additional review of this issue bythe scientific community is underwayand will provide a stronger basis for anymodifications to the ODP related to thisissue in future years. EPA notes that aslight increase in methyl bromide's ODPwould not alter the regulatory regimeadopted for this compound. Also, theAgency does not believe it should, as aregulatory matter, continually adjust theODP of any compound as scientificinvestigation yields preliminary newinformation that has not been fullyaccepted by the internationalassessment process and that may befurther modified with additionalresearch.

Rather, the Agency believes that, tothe extent there is no regulatory impact,the ODP should be establishedconsistent with the scientificinformation presented in the two-yearcycle of scientific assessments under theMontreal Protocol, and thus correspondto actions taken by the Parties to theProtocol. The Agency notes the mandatein section 602(e) of the Clean Air Actthat the ODP specified under the Act"shall be consistent" with the ODPspecified under the Protocol supportsthis a pproach.

b. Hbr Branching. Assuming the fasterrate of formation of HO2 with BrO asdiscussed above, an important area ofuncertainty is whether.and to whatextent reaction of HO 2 with BrO leadsto the formation of Hbr plus 03. To theextent such reactions occur in thestratosphere, the ozone depletionpotential of methyl bromine would bedecreased.

This issue was examined in detail inthe update report from the ScientificAssessment Panel. It stated that "a

Federal Register /.Vol. 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations 65035

major uncertainty in the calculation ofbromide-related ozone loss and ODPs isassociated with quantification of therate of formation of HBr in thestratosphere."

While the assessment panel hadbefore it several calculations assumingdifferent rates of "HBr branching" andincluded one of these calculations in itsreport, it nonetheless rejected includingthese estimates in its finaldetermination of methyl bromide's ODP.The panel report stated two factors asarguments against its inclusion. First,there is no evidence of analogouschlorine reactions producing HCI.Second, while additional data on BrOmeasurements is necessary to draw anyfirm conclusions, the assessment reportstates: "Although the upper range of theobserved BrO would appear to be inconflict with a significant HBr source,that lack of definitive data for HBr andthe large scatter in observed BrO madeit difficult to rule out this possibility."

Comments on these issues weresubmitted by the Methyl BromideWorking Group. They argue that nobasis exists to believe that an analogousreaction with HCI would in any way berelevant to HBr branching; that limitedmeasurements of HCI do exist; and thatHBr branching is consistent with recentatmospheric measurements.

The MBWG provided limited data tosupport the contentions that productionof HCI is significant or not relevant towhether HBr formation occurs.Additional research will be important tofully resolve this issue, including moredata on observed values of HBr and BrO.Based on the evidence available at thetime of assessment, however, the Panelconcluded that the inclusion of HBrbranching was sufficiently speculativethat the Panel excluded it from its bestestimate of the ODP of methyl bromide.The assessment panel report states thatthe higher ODP values for inclusion ofa faster BrO plus HO2 reaction "is notrecommended" and "neither is thelower value of the ODP obtained whenit is assumed that 10% of the BrO plusHO2 reaction produces HBr." Therejection of HBr branching by the Panelwas based on insufficient data onrelevant reaction rates understratospheric conditions of temperatureand pressure and the need for additionalstudies on the formation of HBr by other'reaction such as BrO plus OH and Brplus HO2 to improve the understandingof partitioning of bromine in thestratosphere. This lack of evidencesupporting HBr partitioning along withthe belief that no evidence exists thatanalogous chlorine reactions (CIO plusHO 2 and CIO plus OH) produce HC1were the basis for the Panel's decision

not to include HBr branching when theyrecommended the estimate of the ODPof methyl bromide. For the reasonsdiscussed below, EPA fully concurswith this decision and with the Panel'sconclusion.

To evaluate the impact of differentdegrees of HBr branching on the ODP ofmethyl bromide, the MBWGcommissioned an analysis using a stateof the art atmospheric chemistry model.The model calculated the ODP assumingfirst, an estimated lifetime of methylbromide of 2.1 years, and second,assuming a significant oceanic sinkresulted in an atmospheric lifetime of1.3 years. Assuming that a 10%branching of HBr occurs, and using thefaster rate constant for BrO plus HO2(see above), the model calculated an

'ODP of 0.24 and 0.15 for an atmosphericlifetime of 2.1 years and 1.3 years,respectively. If HBr branching occurredat the rate of 5%, the calculated ODPsare 0.4 and 0.24, for lifetimes of 2.1 and1.3 years, respectively. The authors thengo on to compare the model calculatedlevels of HBr with the limited data fromthe field. While stating that 10% HBrbranching leads to a 6-7 parts pertrillion by volume (pptv) of HBr at 32km compared to an upper limit of 4pptv measured by Traub, the authorsconcluded that despite theinconsistency, branching of as much as10% cannot be ruled out given the"expected temporal and spatialvariability of HBr and the relativelysmall samples of data from which theupper limits are derived." Finally, theauthors state that their modelcalculation does not take intoconsideration possible losses of methylbromide to land surfaces which wouldfurther reduce the calculated ODP.

In addressing the basis for theconclusions reached in the AssessmentUpdate report, the MBWG first arguesthat branching to form HCl is consistentwith atmospheric measurements. Theycite a paper by Stachnick et al., inGeophysical Research Letters to supportthis claim. While the paper provides anumber of possible explanations for theelevated level of HCI, it does notmention the relevant analogous reaction(HO2 plus CIO) as a plausibleexplanation. Furthermore, laboratorystudies of OH plus CIO have producedno direct evidence in support of theformation of HCL. (Memorandum fromNASA to EPA, August 19, 1993.) TheMBWG cites a paper by Lee (J. Chin.Chemical Society) as containinglaboratory evidence that HCI is formedby the reaction HO2 plus ClO. Concernshave been raised that thii paperrepresents the only published workdemonstrating this reaction, that

internal controls used in the experimentwere inadequate, and that efforts to datein the United States to verify thisexperiment have not been successful.(Memorandum from NASA to EPAAugust 19, 1993.)

Finally, the MBWG's comments arguethat since the scientific communityagrees that the possibility of HBrbranching cannot be ruled out, it isimproper that "EPA in effect does justthat, by adopting an ODP value whichfails to take this possibility intoaccount." However, when presentedwith much the same information, for thereasons described above, the scientificassessment panel also deemed it moreappropriate to calculate the ODP ofmethyl bromide without factoring inany specific value for HBr branching.The Agency also believes that theevidence provided by the MBWG iseither scientifically flawed orinsufficient for the reasons stated aboveto include HBr branching in itscalculation of methyl bromide's ODP.While the Agency recognizes thatadditional research is necessary to betterunderstand the issue of HBr branching,the evidence available to date does notmerit including it in its ODPcalculations.

It is important to note that the papersubmitted by the MBWG on these issueswas also submitted for publication in ascientific journal and has since beenmodified and resubmitted forpublication. (Telephone conversationwith author September 23, 1993). It isalso worth noting that key aspects ofanalysis presented in the paper that theMBWG relies upon were also reviewedprior to the issuance of the updatereport by the Scientific AssessmentPanel. As discussed in detail above, theupdate report concluded that the role ofHBr branching was sufficientlyspeculative that it should not be takeninto account in its calculation of ODP.Based on its review of all of theevidence, EPA concurs with the viewthat inclusion of HBr branch, in thecalculation of methyl bromide's ODP istoo speculative. Should additionalraeasurements or modeling providemore conclusive evidence in support ofHBr branching, then the Agency wouldconsider future changes to reduce theODP of methyl bromide.

c. Other Sinks for Methyl Bromide. Inproposing an ODP of 0.7, EPA statedthat this calculation was based only onreactions with the OH radical and thatan important area of uncertainty waswhether other oceanic or landbasedsinks for methyl bromide exist. To theextent significant additional sinks formethyl bromide exist, they would resultin a lower ODP for this compound.


Similarly, in the update of theProtocol's Scientific Assessment onmethyl bromide, the panel concludedthat "possible oceanic and terrestrialsurface removal processes are one of themajor areas of uncertainty indetermining the global budget formethyl bromide." EPA receivedextensive comments from the MBWGand has reviewed several recent paperspublished related to the broader issue oftheglobal "budget" of methyl bromide.

The comments from the MBWG pointout the possible discrepancy betweenthe past commercial sales of methylbromide and measurements ofatmospheric concentrations of thiscompound. They cite papers byCicerone (1988) and by Khalil (1993) toargue that while commercial salesincreased in the mid-1980s, measuredatmospheric concentrations Increasedonly slightly if at all. From this possibleanomaly, the MBWB argues that anadditional important sink must exist formethyl bromide. The comment fails,however, to reflect additional datapresented by Khalil (1993), whichconcludes that atmosphericconcentrations did increase from theperiod 1988-1992 at the rate of about3% plus or minus 1% per year. Becausethese data on production andconcentrations do not portray aconsistent picture, no firm conclusionscan be drawn from them concerning theexistence of additional sinks for methylbromide. The potential for bothadditional sources and sinks for methylbromide is an important area ofuncertainty and more informationshould be available in future years.

In order to estimate the potentialimpact of the oceans as a substantialsink for methyl bromide, the MBWGincluded information based onmodelling performed by Sze asdescribed above. This analysis showedthat, even If the oceans were indeed amajor sink for methyl bromide, theatmospheric lifetime based on thisfactor alone would decrease from 2.1years to 1.3 years, and decrease the ODPto 0.4, still well above the 0.2 threshold.

EPA also received a paper from aresearch scientist at NOAA thatexamines the potential role of theoceans in regulating the atmosphericconcentrations of methyl bromide(Butler, 1993). This paper wassubmitted to the docket at the same timeit was submitted for publication in ascientific journal. Based on commentsreceived from the journal, this paper hasbeen substantially revised andresubmitted for review and possiblepublication. (Telephone conversationwith author, September 16, 1993). Thisoriginal paper suggests that any

evaluation of the atmospheric lifetimeand impact on ozone of methyl bromidemust include the role of the oceans. Thepaper suggests that the oceans are thelargest source of methyl bromide, andthat they could act as a regulator of theatmospheric concentrations of methylbromide. Thus, even if man-madeemissions of methyl bromide werereduced through regulatory action, thispaper suggests that reductions inatmospheric concentrations may not bereduced correspondingly. According tothis paper, the oceans could increasetheir emissions to the atmosphere,largely or in part offsetting any gainsfrom reductions in man-madeemissions.

However, recent time series datapublished by Khalil (1993] suggest thatatmospheric concentrations have beenslowly increasing over the past fouryears. This data appears to contradictthe hypothesis that atmosphericconcentrations would not change ifmanmade emissions decreased.

To explore his hypothesis, Butlerdevelops a simplified model combiningboth oceanic and atmosphericresponses. The results from this modelshow the relationship between theatmospheric lifetime of methyl bromideand the saturation anomaly of thecompound. The saturation anomaly iscalculated by comparing the ratio ofmeasurements of atmosphericconcentrations with levels of oceanicconcentrations. His analysis suggeststhat if the value for the saturationanomaly is 100%, then the atmosphericlifetime would be slightly less than 2.0years. If, however, the value for thesaturation anomaly were 300 percent,then the atmospheric lifetime of methylbromide would be reduced to slightlyless than one year.

Only limited and somewhatconflicting data exist of measurementsof the saturation anomaly of methylbromide. Khalil (1993) reports on datafrom two shipboard experiments thatoccurred in 1983 and 1987. Based onmeasurements taken on these voyages,he estimated a saturation anomaly of40.-80 percent. This value would beconsistent with an atmospheric lifetimeof methyl bromide of just over 2 years.In contrast, a paper by Singh (1993)reports on data from a different oceanicexperiment conducted in 1981-82which produced values for thesaturation anomaly at 180-240 percent,which would lead to an atmosphericlifetime of methyl bromide of 1-1.2years.

Without additional data, it isimpossible to reconcile the range invalues provided by the two limited datasets. However, in the explanation of his

data, Singh (1993) suggests that It maynot be appropriate to generalize to theentire ocean from the data he collectedin the eastern Pacific. He points toproductivity maps that suggest thesamp led area is 2-4 times moreproductive than the oceans as a whole.The model developed by Butler isnecessarily simplified (given the paucityof data) and models the oceans as awhole. Nonetheless, additional data isessential to narrow the uncertaintiesraised in Bulter's analysis. Given thedata available to date, the Agency doesnot believe it is prudent to modify thecurrent regulatory strategy based on thehypothesis that the saturation anomalyacross the entire oceans would besubstantially greater than that obtainedin the measurements reported by Khalil.

Finally, the MBWG comments alsosuggest that terrestrial sinks could besignificant and further reduce the ODPof methyl bromide. While methylbromide acts as a strong methylatingagent, no published data existconcerning the possible magnitude oflosses through land-based surfaceremoval. The commenter essentiallycited information contained in apresentation made on this issue at theScientific Workshop on methyl bromideby Kolb. This presentation focusedprimarily on what studies could be doneto evaluate land-based sinks andcontained no data specificallydemonstrating that such a sink exists formethyl bromide. Since no additionalinformation is presented in support ofmodifying the ODP to reflect this factor,EPA must reach the same conclusion asthe Scientific Assessment Panel, that aninsufficient basis exists for altering theODP based on the existence of land-based sinks. Should additionalinformation be developeddemonstrating that surface losses are animportant sink for methyl bromide, thecalculation of its ODP could bemodified accordingly in the future.

d. Natural and Man-Made Emissions.In addition to emissions from humanactivities, the oceans also represent asignificant source of emissions ofmethyl bromide. The relative role ofemissions from natural versus man-made sources of methyl bromide is oneof the key areas of uncertainty and hasimportant implications for theeffectiveness of measures to safeguardstratospheric ozone. Also, the totalamount of emissions is relevant to theissue of atmospheric lifetime andtherefore the calculation of ODP.

Based on their review of relevant dataon this issue, the Protocol's ScientificAssessment update concluded that man-made emissions amounted to 25%percent plus or minus 10% of total

Federal Register / Vol. 58, No. 236 / Friday, December 10,' 1993 / Rules and Regulations 65037

methyl bromide in the atmosphere. Thiscalculation assumes that theatmospheric lifetime of methyl bromideis two years and calculates thatcorresponding total emissions areroughly 75-110 thousand metric tonnesannually to obtain the measuredatmospheric abundance of 9-13 pptv. Ofthis amount, roughly 25 thousandtonnes would be from man-madesources and the remaining roughly 75thousand tonnes would be from naturalsources.

In their comments, the MBWGpointed out that if a one-yearatmospheric lifetime were assumedinstead of two years, that the percentcontribution from man-made sourceswould be cut in half. However, if thelifetime of methyl bromide were a year,annual emissions would have to doubleto 150-220 thousand metric tonnes inorder to maintain the measuredatmospheric abundance of 9-13 pptv.While that amount cannot be ruled out,Khalil (1993), in the most extensivereview of the methyl bromide budgetpublished'to date, estimated thatemissions from the oceans amount toonly 35 thousand metric tonnes. Inanother paper on this issue, Singh(1993) estimated that emissions from theoceans are on the order of 60 (40-80)thousand metric tonnes/year. Whileboth papers point out the substantialuncertainties and limited availability ofdata to calculate the methyl bromidebudget, based on the informationavailable to these investigators, theycalculated that in the absence of othersignificant sources, emissions from theoceans appear to be well below theamount required to support a one-yearatmospheric lifetime of methyl bromide.However, a related area of uncertainty iswhether methyl bromide from theburning of biomass could also representa significant source of man-madeemissions. (Khalil, 1993).

Finally, the MBWG's commentsdiscuss a number of possible alternativeexplanations for the north-southgradient that exists in measurements ofmethyl bromide's atmosphericabundance. The science assessmentupdate suggests that this gradientreflects a significant source of methylbromide from agricultural sourcesprimarily in the northern hemisphereconsistent with commercial sales anduse of this compound. While directmeasurements of emissions of mqthylbromide from agricultural applications,of course, provide clearer evidence ofthe role of man-made methyl bromide,the existence of an interhemisphericgradient with higher concentration inthe north may be an indirectconfirmation that such emissions occur.

This evidence tends to counter thecontention by some agricultural groupsthat methyl bromide injected into thesoil largely breaks down prior to itsrelease into the atmosphere.

The comments by the MBWGsuggested that the gradient could occurfor a number of other reasons including:the fact that the oceans constitute a fargreater percentage of the Southernhemisphere total mass and, therefore,constitute a larger sink in that half of theglobe; that northern hemispheric oceansare biologically active and represent alarger natural source of emissions; thatthe larger land mass in the northernhemisphere represents a larger landsink; that the gradient in north to southof the OH radical is responsible for thegradient in methyl bromide abundances;and that large emissions of methylbromide from biomass burning in thesouthern hemisphere is the reason itdoes not demonstrate a hemisphericgradient. Each of these hypotheses ispresented in the comments as anequally feasible explanation for theinterhemispheric gradient of methylbromide. Without presenting anyconvincing arguments for any of thesealternative hypotheses, the MBWG'scomments state that "it is unscientificfor EPA to simply pick one hypothesis'out of the hat' and to dismiss all otherplausible explanations for theinterhemispheric gradient." Thepossible explanation of theinterhemispheric gradient included inEPA's proposal was identified by theProtocol's Scientific Assessment Panelas the most plausible explanation. Thepanel stated that the interhemisphericgradient was clear from the availableatmospheric measurements and "mostprobably indicated an excess source inthe Northern Hemisphere." It reachedthis tentative conclusion rather than theones preferred by the MBWG because ithad data on methyl bromide useindicating higher emissions in the norththan the south. Either no data, orinconclusive or conflicting data, was allthat was available for each of thealternative hypotheses presented by theMBWG. While additional data will helpclarify this issue in future assessments,the Agency believes that no additionalinformation was presented in thecomments to justify disagreeing with thestatement on the possible cause of theinterhemispheric gradient contained inthe assessment panel update report.

One final area of uncertainty relates tothe burning of leaded gasoline asanother possible source of man-mademethyl bromide. While the use ofleaded gasoline is decreasing in favor ofunleaded gasoline, this source mayprove to be a significant source of

methyl bromide in the short-term. Thesource of the methyl bromide in leadedfuel is ethylene dibromide (EDB), amaterial that is added to the fuel as alead scavenger (0.015g EDB/liter fuel).Limited data exists suggesting that theexhaust of a vehicle using leaded fuelmay contain some 22-44% organicbromines, with the portion of thisemitted as methyl bromide varyingbetween 54-82%. Additional studieswill be required to fully evaluate thesituation. However, in the United States,leaded fuel usage is only 1 percent orless of total fuel usage, making theatmospheric contribution of methylbromide from this source negligible.However, to the extent leaded fuel, isstill used in other parts of the world, itis an important issue for calculating themethyl bromide budget and for possiblefuture international controls.

e. Summary of ODP Discussion. Boththe Protocol's Scientific AssessmentUpdate on methyl bromide and thediscussion of methyl bromide's ODP inthe preamble to EPA's proposed actionidentify a number of importantuncertainties concerning the ODP. EPAreceived extensive comments related tothese uncertainties and somecommenters suggested that because, intheir view, the ODP is likely to fallbelow 0.2, the Agency should delaytaking any action.

In reviewing these comments, EPAbelieves most if not all of theseuncertainties were reviewed by theScientific Assessment Panel in theirupdate report. While recognizing thatthe ODP may change in the future asadditional information becomesavailable, the panel concluded that 0.7was the current best estimate for theODP of methyl bromide. It explicitlyrejected both higher and lower estimatesbased on the same factors commenterson EPA's proposal have since raised.

The comments further demonstratethat any single factor alone, even in anextreme case, is unlikely to reduce theODP below 0.2. Thus, even the highvalue for HBr branching (10 percent)alone would reduce the ODP to only0.24. To reduce the ODP below 0.2would require both a substantial oceanicsink and significant HBr branching.

To put the 0.2 ODP value in context,it is important to note that compoundswith values below 0.2 are also beingseverely regulated under both theMontreal Protocol and CAA regulations.For example, methyl chloroform has anODP of 0.12 (based on the latestscientific assessment) and is beingphased out by January 1, 1996 bothunder the Protocol and CAAregulations. HCFC-141b has an ODP of0.11 and is scheduled for phaseout in


today's regulations by 2003. Thus, evenif the ODP of methyl bromide were todrop below 0.2, the compound couldstill be regulated in much the same timeframe established by today's rule.

Finally, the above discussion of theODP has focused exclusively on steady-state values for the ODP of methylbromide. The steady-state valuecalculates the impact of the compoundon ozone relative to CFC-11 over aperiod of several hundred years. To theextent that the greatest concerns aboutthe impact of ozone depletion will occurover the next ten years after which peakdepletion will be declining, EPA alsoconsiders the ODP over that shorter timeperiod important. Because of its shorteratmospheric lifetime compared to CFC--11 (2 years compared to 60 years), theshort-term impact of methyl bromide onozone is substantially greater than itsimpact calculated over a much longerperiod of time. The scientificassessment update report calculates theODP of methyl bromide over a period of10 years at 7.0. The Agency believes itIs importantto consider that short-termreduction in risks to the ozone layer isan important part of its efforts underTitle VI of the CAA, (See section onHCFCs and IEER petition, above). EPAbelieves methyl bromide "contributessignificantly to harmful efforts on thestratospheric ozone layer" to an extentmuch greater than reflected in itssteady-state ODP. Methyl bromidesshort-term effect, even If the steady stateODP is proven to be just below 0.2,would still be much higher than anysubstance not currently on the class Ilist, and could well still merit listingbased on Its substantial contribution tostratospheric ozone depletion.4. Uses and Substitutes for MethylBromide

Methyl bromide is a broad spectrumpesticide which is widely used as afumigant in the control of insects,nematodes, weeds, pathogens. androdents. It is primarily utilized for soilfumigation (80 percent of world-wideuse), commodity and quarantinetreatment (15 percent of use), andstructural fumigation (5 percent of use).Because of its relatively low price, andits physical and chemical attributes, it isused world-wide in many differentsituations. Due to the versatility of thischemical, there is no single alternativetreatment that can duplicate the actionof methyl bromide in all its manyapplications. It is possible, however, toconsider alternative chemicals andproduction methods that can replacemethyl bromide to a significant degreein numerous situations.

In the last several months, activitiesrelated to several alternatives have beeninitiated. While additional researchfield tests and regul4tory approvals willbe necessary to define efficacy andapplicability and may take considerabletime, these initial steps represent animportant beginning. Specifically,carbonyl sulfide has been identified byresearchers in Australia as a potentiallyeffective pest control material forcommodity pests such as beetles, fruitflies, moths, mites and termites, as wellas a soil fumigant for nematodes.Whether or not registration is sought forthis material in the U.S. remains animportant issue. Enzone has justrecently been approved for registrationfor use as a pesticide for nematode anddisease control on grapes and citrus Inthe United States. In addition, newapplication methods are currently beingfield tested for metam sodium whichshow significant improvement incoverage and penetration. And in 1994,Telone will likely be investigated inlarge scale field trials in California, withthe intention of a possible future reentryof use in that state. Several researchershave recently began developing asystem utilizing carbon dioxide incombination with reduced dosages ofexisting fumigant agents in structuraland commodity applications to achievecontrol levels better than what has beenseen with methyl bromide alone. Inaddition, EPA expects an application tobe filled shortly with the EPA Office ofPesticide Programs for the use ofDazomet as a soil fumigant for a numberof high value applications which nowuse methyl bromide. While none ofthese alternatives are likely to makesignificant near-term inroads into theuse of methyl bromide, depending onthe outcome of additional efforts, theycould contribute to the transition by2001.

a. The NAPLAP Study. The UnitedStates Department of Agriculture(USDA) issued a document in April1993 entitled, "The Biologic andEconomic Assessment of MethylBromide," which was prepared by theNational Agriculture Pesticide ImpactAssessment Program (NAPIAP), andwhich will henceforth be referred to asthe NAPIAP assessment. The NAPIAPassessment was intended to evaluate theimpact on American agriculture from animmediate ban of methyl bromide.

EPA believes that the reportrepresents a useful analysis if methylbromide were banned immediately, butthat it was not designed nor intended toevaluate the proposed phaseout of thiscompound in the year 2000. Because Itlooks at the impact of an immediate ban,it assures little use of replacement

materials by the agriculturalcommunit.

The NAP assessment consideredan acceptable alternative to methylbromide to be one that duplicates itsbiocidal actions. This serves to restrictthe range of materials which theNAPIAP report considered to replacemethyl bromide. Methyl bromide isused to control pests which wouldotherwise cause crop damage andeconomic losses. However, it is notnecessary (and probably not possible) toduplicate methyl bromide's broadspectrum efficacy to achieve pestcontrol. EPA believes, nonetheless, thatit is possible to manage the pestscurrently controlled by methyl bromidewith other chemical pest control tools,as well as nonchemical and culturalmeans.

Many years of research have perfectedthe use of methyl bromide as a soil andcommodity fumigant. It is reasonable toexpect that major research efforts will beneeded to improve the performances ofmetam-sodium, dazomet, 1,3-dichloropropene and other alternativepest control techniques. For example,preplant methyl bromide fumigation hasshaped the way in which research,breeding programs, and commercialpractices are pursued with strawberrycultivation in California. Strawberrycultures were bred and selected In soilsfumigated with methyl bromide. Underthese circumstances, there has been noneed to maintain or improve resistanceto minor root pathogens, let alone majordiseases such as Verticillium. Very littleis known about cultivar resistance toroot diseases because commercialstrawberries are grown under "nearaxenic" soil conditions. Researchers arelikely to overcome at least part of theimpacts of the methyl bromide phaseoutby focusing on different strawberrycultures and developing appropriatepest management practices.

b. Comments. Several individuals andgroups submitted comments to EPA onsubstitutes and alternatives to methylbromide. In many cases, those in theagricultural community indicated theybelieved that alternatives to thismaterial were extremely "limited",which would result in a situation wherepests currently controlled by methylbromide would be left uncontrolled,causing severe economic losses. EPAacknowledges that there is no chemicalcurrently in existence nor envisioned inthe short-term which will duplicate thebroad spectrum biocidal action ofmethyl bromide. However, EPA believesthat in order to prevent crop damage,and keep pests below the economicdamage threshold, it is not necessary toduplicate the broad spectrum efficacy of


methyl bromide. There are, in existenceand under development, botk chemicaland non-chemical pest control toolswhich can manage insects, weeds,nematodes, and plant diseases. In pestmanagement cases where alternativesare not currently available, EPAsupports research, such as that nowbeing spearheaded by the USDA, toidentify and implement good alternativepest control materials and methods.

EPA agrees with comments that statedthat methyl bromide is a crop protectiontool that currently satisfies a nufmber ofimportant needs. If other tools cansatisfy these needs, however, they willbe accepted and utilized by theagricultural community. In this light, afumigant with analogous broadspectrumbiocidal characteristics as methylbromide is not essential to combat pestswhich cause crop damage and yieldlosses. Better utilization of existingchemical pesticides, together with non-chemicals and cultural methods, canaddress a many of the pest problemsnow managed by methyl bromide.Therefore, alternatives to methylbromide need not be identical to thischemical in order to manage pests thatcan cause crop loss.

Comments were raised concerningmaterials that have potential to be usedin place of methyl bromide and thatmust be evaluated on a case-by-case,crop-by-crop basis, appraising efficacyagainst the target pest, practicalfeasibility in a particular crop, economicviability, health and environmentalrisks, and regulatory issues. Severalchemical and non-chemical pesticidesexist today that are effective againstinsects, weeds, nematodes, and plantdiseases. These will need to undergofurther research to determine if they arepractical field replacements for pestsnow controlled by methyl bromide.These materials are not general biocideslike methyl bromide, but are action-specific to a particular set of pests.Therefore, it is likely that thesematerials will need to be used incombination with each other, and inconjunction with a good integrated pestmanagement program, to replace the useof methyl bromide. Research iscurrently underway on both thegovernmental and academic levels, aswell as in the private sector, to ensurethat alternative materials and methodswill be viable and available beforemethyl bromide is phased out.

A number of individuals andassociations commented on thepotential negative health effects ofincreased UV-B radiation, supportingthe phaseout of methyl bromide toensure protection of the ozone layer,thereby protecting human health and

the environment in general. EPA agreeswith this assessment, believing that thebenefits to be expected with thephaseout of this chemical areconsiderably greater than any short-termcosts.

Several commenters discussed thehealth and environmental problems thatincreased UV-B radiation would cause,the toxicity of methyl bromide, -especially regarding the potential forworker exposure. The Physicians forSocial Responsibility commented thatmethyl bromide appears to producelasting neural behavioral deficits thatare likely to impair cognitive functionseven when used under conditionscurrently judged to be acceptable. Theyalso noted that since this chemical is apotent alkylating agent and mutagenic,it may be carcinogenic.

Several commenters stated that oncemethyl bromide has been listed as aclass I ozone depleting substance, EPAshould implement other pertinentjections of the CAA Title VI, notablysections 608 and 610. Section 605concerns emissions control, which inthe case of methyl bromide wouldrequire users to reduce emissions asmuch as technologically possible in theinterim. Section 610 allows for a ban onnon-essential uses of class I substances,which would require users toimmediately implement existingreplacements for aerosol applications ofmethyl bromide. However, after carefulreview and due consideration, EPAbelieves that it is premature to consideradditional regulations at this time.

Some commenters have raisedconcerns over regulatory issues, citingthe time and cost involved in processingand registering pesticides with EPA. Itis an EPA requirement to thoroughlytest any material which will be utilizedas a pesticide to evaluate the potentialfor unreasonable adverse health andenvironmental. See, 40 CFR part 1 (58).This can take many years, dependingupon the type of material and thecomplexity of testing needed. However,despite the time involved, pesticides areregistered, and do become commerciallyavailable. While this issue may slow theshort-term accessibility of somematerials and is one reason for notrequiring interim reductions, it shouldnot be a significant long-term barrier tothe development of methyl bromidereplacements.

c. Soil Fumigation. One of the mostcommon uses of methyl bromide is as asoil fumigant. It is utilized to controlnematodes, pathogens, insects, andweeds which reside in the soil anduncontrolled, can cause significant croploss. Methyl bromide, especially whencombined with chloropicrin, can

thoroughly eliminate these pests fromthe soil. However, since this materialwill no longer be available, other pestcontrol means will need to be developedand utilized to allow farmers to produceconsistent and quality produce. EPArecognizes that this process will involveconsiderable research on existing anddeveloping pesticides, as well as theregistration of new pesticides. Theprocess of pesticide registrationincludes both health and environmentaltesting, and may compromise the near-term utilization of some of thesematerials.

Several individual farmers and growerorganizations commented on thepotential lack of pest control materialswith which to replace methyl bromide.As discussed above, EPA believes thatalternatives to this chemical should bejudged'not upon their ability toduplicate the biocidal action of methylbromide, but upon their ability toeffectively and economically control,pests currently managed by methylbromide. In this light, methyl bromide,while effective, is not the only materialregistered with EPA which can controlplant pathogens, nematodes, weeds, andinsects. In this light, materials which arecurrently registered on other crops forother uses may have applications for asalternatives to methylbromide.

Several chemical pesticides arecurrently on the market whicheffectively control insects, weeds,nematodes, and plant diseases, andtherefore have good potential to replacemethyl bromide in specific soil pestcontrol situations. Application methodsfor many of these materials will need tobe modified in order to manage pestsnow exclusively controlled by methylbromide. EPA recognizes that severalyears of research will be required beforegood alternatives to methyl bromidewill be available to the agriculturalcommunity.Among the existing chemicalpesticides that can replace methyl

romide, the methyl isothiocyanate(MIT) generators (Metam Sodium andDazomet), and 1,3-dichloropropene(1,3-D, Telone) have the greatestpotential to manage pests currentlycontrolled by methyl bromide. Thesematerials are not, and should not beconstrued to be equivalent to methylbromide. In order to achieve full controlof the wide spectrum of soil pests thatcan decrease yield, these pesticides willoften need to be augmented by otherchemical pesticides, non-chemicalmaterials and cultural practices (e.g.,development of resistant stock, and shiftin cropping practices).Both the NT generators and 1,3-D

will need to undergo field research on


soil incorporation and generalapplication methods to ensure that thechemical is well distributed at rates anddepths needed to control target pests.Research will be required to delineateefficacious dosages, applicationprocedures and reentry periods. Severalcommenters noted that these substitutesneed better delivery systems toadequately replace methyl bromide.These pesticides are undergoing areview of application methods on boththe Federal and state (California andFlorida) levels with regard to workerexposure. It is likely that registrationreinstatement will involvemodifications in the use of thesematerials to insure safe and efficaciousapplications. Many commenters fromthe agricultural community noted theeffectiveness of replacement materialsfor specific crop applications (seeBackground and Summary Document).

In addition, as numerous commentspointed out, there are severaloutstanding regulatory and registrationissues regarding these pesticides. Forexample, Dazomet is not yet registered,for food crops in the U.S., and Teloneis not currently permitted in California.EPA believes that, given the timeallowed before the phase out of methylbromide, many of the near-termdevelopmental and regulatory hurdlesmay be overcome and the necessaryadaptations may be made with theseand other materials.

One advantage of the current andpotential methyl bromide replacementmaterials is that they are, in general, farmore selective than methyl bromide.The broad spectrum activity of methylbromide, often considered an advantage,thoroughly sterilizes the soil, destroyingboth the pest organisms, as well as thosethat are a beneficial part of the soilecology. Replacement pesticides are onthe whole more selective since theyaffect only specific pest classes, therebyhaving potentially less impact on theoverall soil fauna and flora. However,several comments expressed concernregarding the possibility that, in order toachieve good control of economic pests,replacement pesticide application ratesand frequency of application may causesecondary environmental problems.EPA believes that through the use ofimproved application techniques nowunder development (e.g., deeperinjections, thicker tarps, use of carrieragents), it is likely that effectivenesscould be increased while dosage, andthereby risks to ozone depletion, can bereduced.

Other chemicals that are already onthe market and may have potentialwhen combined with other materialsand practices include chloropicrin and

carbon disulfide, as well as nonfumigantnematicides (carbofuran, oxamyl,fenamiphos, ethoprop, aldicarb, etc.)combined with fungicides (benomyl,metalaxyl, etc). Chloropicrin, currentlyused in combination with methylbromide, may prove to be efficaciouswhen used with other pesticides. Eachpest situation and control methodneeded will have to be evaluated inrelation to the target pest, the cropgrown, the temporal and geographiceffects, and the existing integrated pestmanagement program.

Several pesticides are currently in thedevelopmental stage, and will needsignificant laboratory and field researchbefore reaching the marketplace andbefore their value as methyl bromidesubstitutes can be fully assessed. Theseinclude the inorganic azides,bromonitromethane, nemamort, andcarbonyl sulfide, among others. Thesematerials are currently in thedevelopmental stage, and will requirefurther evaluation before their potentialas substitutes can be determined.

There are numerous methods formanaging soil pests that arenonchemical in nature. While some ofthese methods are already used tomanage economic pests, many of thesetechniques will need to be field testedon the specific target pests nowcontrolled by methyl bromide, andtherefore are part of a longer-termsolution. These include crop rotation,the use of organic amendments, steam,solar heating, biological control agents,various cultural practices, plantbreeding, biotechnology, grafting, andthe physical destruction of pests andtheir habitat. Although these pestcontrol methods cannot control alleconomic pests when used singly, whenpart of an overall integrated pestmanagement program, these and othertechniques may be effective in reducingpest numbers. Research will be neededon these and other methods todetermine their effectiveness inreducing pest numbers.

Since many of the replacement pestcontrol methods may be new to growersreliant on methyl bromide, anagricultural extension program willlikely be required during the initialstages of implementation. Severalcommenters noted existing limitationsfor many of the proposed replacements,and noted that cost and supplementaleffort may render some replacementsinfeasible in the short-term. While thismay seem true in the short-term, newand better application methods ofexisting chemicals may dramaticallyhelp both the short- and long-termsituation.

Other commenters discussed theprocess by which methyl bromide usecan increase the amount of soil nitrogenavailable to plants, indicating that thiswill not be possible without the use ofthis chemical. However, there arenumerous ways to add nitrogen, as wellas other nutrients, to the soil throughthe use of commercially availablefertilizers, as well as organicamendments and crop rotationprograms. A program of good soilmanagement can supply plant nutrientswithout increased pollution or groundwater contamination, resulting inhealthier plants which are moreresistant to pests than those which arestressed due to poor nourishment.

The issue of seed bed diseaseprotection was raised by commenterswho perceive that yields wouldsubstantially decrease without methylbromide. EPA believes that several ofthe existing fungicides, along with thosein development, may adequatelyprevent the spread of disease and asignificant decline in production. Whileresearch will be necessary to definedosages and appiication procedures, itis highly probable that efficacious andeconomically viable materials will be inplace by the phaseout date.

EPA agrees with several commentsthat cite the beneficial health effects offresh fruits and vegetables. However,there is no evidence to support theassertion that fruits and vegetables willno longer be available following thephaseout of methyl bromide. EPAexpects that both currently availablecontrol strategies, and those which arein development, may be utilized tocontrol pests and minimize crop losswhen methyl bromide is no longeravailable.

d. Commodity Fumigation. Methylbromide is currently used to treat bothfood and nonfood commodities prior toshipment, during shipment, and whileiii storage. It is utilized as an effectivequarantine tool to prevent exotic pestinvasions and to assure that pestsspecific to a particular area are notcarried to new regions. In this regard,incoming fruits and vegetables, as wellas other commodities, are treated ifsuspected of harboring economic pests,or if the commodity origin is an areawhere such pests are known to exist.Commodities in storage or in transportare also treated to ensure that thematerial is not destroyed by pests.About five to eight percent of methylbromide use is in commodityfumigation and is utilized primarily forinsect pests, but also for disease androdent control.

EPA received several commentsexpressing the concern that a good


chemical fumigant does not exist for usein place of methyl bromide. EPAacknowledges that a single chemicalwhich duplicates the action of methylbromide is not now available for use.However, various chemical and non-chemical treatments are available todaywhich can effectively controlcommodity pests, and promisingalternatives appear possible in thefuture (e.g., nitrogen). Although many ofthe transport and storage systemscurrently in use will have to bemodified to accommodate the change,EPA believes it is likely that existingand potential alternatives will proveboth efficacious and cost effective onceImplemented.

ome comments discussed thepotential losses which may occur incommodities not treated with methyl.bromide. This was discussed especiallywith regard to fresh fruits andvegetables. EPA believes that pestcontrol materials and methods existtoday, or are under development, whichcould potentially replace methylbromide in many of the commodityapplications. EPA acknowledges that asof this date, there are some quarantineuse areas where replacements do notcurrently exist. As the final phaseoutdate approaches, EPA will work withconcerned parties to ensure thatquarantine integrity is notcompromised.

Several comments were received thatdiscussed the regulatory issues that willbe impacted by the phaseout. TheUnited States Department ofAgriculture, Animal Plant HealthInspection Service (USDA/APHIS)regulations, which require the use ofmethyl bromide on certain importedcommodities, was seen as a case inpoint. In addition, similar regulations inother countries, most notably Japan,were also seen as a potential issue. Asalternatives to methyl bromide areestablished, governmental bodies thatset agricultural quarantine regulationswill need to adapt and change suchregulations in a way which best protectsdomestic agriculture and importedcommodities. Therefore, EPA agrees thatthis is an important issue and one thatcould take many years to address.

In a related issue, commentersdiscussed the registration of pesticides.Several commenters expressed concernregarding the possibility that pesticidesthat have important but minor uses maynot be supported for registration orreregistration. In addition, somecomments stated that the EPA pesticideregistration process is so lengthy andcostly that few new pesticides will beavailable before methyl bromide isphased out. EPA is aware of this

concern, and understands that thetesting needed to ensure registration ofa viable pesticide can appearformidable. Because of this issue, EPAhas set up a special task force in theOffice of Pesticide Programs tocoordinate and track methyl bromidesubstitution activities, and, if possible,to ease or accelerate the regulatoryprocess for pesticides that areconsidered alternatives to methylbromide.

A number of comments were receivedconcerning the prospects of utilizingirradiation as an alternative to methylbromide. Most notably, commentersbelieved that the capital cost and timerequired to irradiate would render thissubstitute infeasible.

Some considered this option as thereplacement for all methyl bromidecommodity treatments. EPA believesthis is an unlikely, and certainly costlyscenario. Several comments discussedthe issue of public acceptance,speculating that this pest control wouldbe widely rejected. While publicapprehension to irradiation currentlyexists, with additional research andpublic education, this option couldpotentially become more attractive overtime.

EPA is aware that significant researchis ongoing on other attractivealternatives for commodity andquarantine applications. Particularattention is being paid to controlledatmospheres as a potentially attractivealternative to the use of methyl bromide.For example, new, less expensive andmore flexible systems for using nitrogenin a controlled atmosphere are nowbeing marketed. However, for controlledatmosphere to be a viable quarantine/commodity pest control technique, itwill require approval by the countries towhich commodities are being exportedto. In addition, the potential for therecovery and recycling of methylbromide is being investigated. EPAsupports this effort as an importantshort-term solution.

Existing fumigants may also replacemethyl bromide in certain applications.Among the chemical pesticides whichmay be potential replacements arephosphine, propylene oxide, hydrogencyanide, ethyl formate, and ethyleneoxide. Non-chemical pest control toolssuch as irradiation, controlledatmosphere, heat and cold treatments,pest-free zones, physical isolation,microbials, biological control, and hostresistance may be potential integratedreplacement materials as well. Researchwill be necessary to define the activityof these materials, as well as whathuman or environmental hazards couldexist. In addition, research in basic pest

biology, identification, and surveymethods will need to be examined toensure the availability of managementtools over the long-term.

Many comments received on this usearea stated that single alternatives suchas phosphine, temperature treatments,and controlled atmospheres, amongothers, could not be used on allcommodities now treated with methylbromide. EPA understands and agreesthat research must be conducted todefine what commodity can be treated,with what protocol, against what pest,and under what circumstances.Nevertheless, EPA believes that this isachievable, and with researchcommodity pests can be managedwithout methyl bromide. Commentersalso noted that the aeration time neededwith phosphine and holding time withheat, cold and controlled atmospherescan be longer than what is needed withmethyl bromide. EPA acknowledges thatthis will take considerable adjustmenton the part of shipping and storagefirms, but does not believe this is aninsurmountable barrier. Adaptations ofexisting technologies (e.g., combinationsusing heat or carbon dioxide) mightreduce dose and time of exposurerurements.

A received comments in support ofthe phaseout of methyl bromide, withspecial regard to worker-exposure issuesin commodity processing facilities.Several examples were given of workerswho had been adversely affected by thismaterial. The commenters stronglysupport efforts to strengthen worker-exposure and safety regulations, andthus requested that EPA accelerate thephaseout process and require thatcommodities treated with methylbromide be labeled. EPA recognizes thatthe phaseout of methyl bromide in orderto protect stratospheric ozone could alsohave collateral benefits by reducingoccupational exposure to this chemical.Of course, worker exposure to methylbromide substitutes may continue to bea concern in some cases. In any event,EPA does not believe reduction inworker exposure is a basis to acceleratethe phaseout under Title VI. Nor is thisa basis to require labelling under TitleVI. As explained below, EPA does notbelieve the section 611 labellingrequirement applies to agriculturalproducts fumigated with methylbromide.

e. Structural Fumigation. Methylbromide has been utilized to effectivelycontrol wood destroying and boringinsects in buildings, as well as rodentsand other pests in food processingfacilities. Although this use accounts forless than five percent of the total globalusage, it has been considered a


significant pest control tool due to itseffectiveness.

EPA received comments on thepotential for alternatives to replacemethyl bromide for structuraltreatments. Most of them comparedexisting alternatives with metylbromide. While methyl bromide is agood biocide, replacements will notnecessarily need to duplicate itseffectiveness in order to be goodstructural pest control tools. As withother chemical and non-chemicalreplacements, pest control tools in thisuse area will need to be thoroughlyevaluated in regard to pest controlefficacy, practical feasibility, andeconomic viability. It is essential thatresearch be done on alternatives to theuse of methyl bromide in the millingindustry and the food processingindustry to insure that chemical residueproblems are addressed.

Several options exist with regard topest problems in dwellings, withsulfuryl fluoride the principal chemicalalternative. In this area, methods toreduce methyl bromide dosage bycombining the pesticide with carbondioxide, have shown good success.Contact pesticides which control certainwood boring pests include diazinon,carbaryl, permethrin, cypermethrin,fenvalerate, propoxur and borate whichis now registered in the United Statesfor control of termites and other wooddestroying insects, and is currentlybeing successfully utilized on acommercial basis. Non-chemicaltreatments include heat and coldtreatments and the use of microwaves.Due to these developments, EPAbelieves it is likely that methyl bromideuse will decline significantly, and thissector will not be adversely impacted toa significant degree by the phaseout.

The principal methyl bromidereplacement for commodity storagewarehouses and food productionfacilities is phosphine. While thismaterial is not applicable in allsituations due to its ability to corrodecertain metals, when it is combinedwith carbon dioxide the amount ofphosphine needed can be significantlyreduced, which in turn diminishes thepotential for phosphine-induced metalcorrosion. As discussed in the proposal(58 FR 15014), other treatments include'heat, cold, modified atmospheres, andinert dust. Additional research will berequired in this area to ensure that allcurrent users of methyl bromide willhave acceptable replacements by 2001.Here, target pests and control optionsmust be well defined in order to utilizepest control materials which are specificto the situation.

5. Analysis of Costs and BenefitsEPA received comments that in the

March proposal it had not adequatelyaddressed the costs and benefits ofaction to phase out methyl bromide. Onthe contrary, EPA included extensivedocuments in the docket whichexamined the uses of methyl bromideand the applicability and costs ofvarious alternatives. (See for example,Preliminary Use and SubstitutesAnalysis of Methyl Bromide inAgricultural and Other Uses (une,1992) and Montreal ProtocolAssessment Update on Methyl Bromide:Science, Technology and Economics,UNEP (1993)). In the case of health andenvironmental impacts, the Protocol'sassessment update provides significantinformation on the likely impact ofcontinued use of methyl bromide onstratospheric ozone.

In comments received on theproposed rule, the MBWG conducted itsown cost-benefit analysis ("Comparingthe Costs and Benefits of EPA'sproposed Phaseout of MethylBromide"). This analysis purports tocalculate benefits based on EPA'smethodology and findings used in pastregulatory impact analysis. It calculatescosts based primarily on an economicimpact study performed by NAPIAP anddiscussed in detail in the previoussection of this notice. The MBWG studyconcludes that the benefits of themethyl bromide phaseout in 2000would be $19-29 million dollars andthe costs would be $5-9 billion. Thisanalysis is flawed for many reasons. Thebenefits calculations are drawn from ananalysis of the impact of increasedemissions of CFC-11. This scenariocompletely excludes the impact ofbromine on stratospheric ozonedepletion and therefore verysubstantially understates the magnitudeof depletion. The benefits of avoidedozone depletion from CFC-11 occurover a period of 200 years, whereas thebenefits from decreased emissions ofmethyl bromide occur within five to tenyears. This factor is omitted from theMBWG's analysis. The analysis of thecosts of phasing out methyl bromidedramatically overstates estimates for thereasons discussed in detail above in thecritique of the NAPIAP study. The costestimates assume an immediatephaseout, assume no additionalalternatives are available in 2000,assume that no improvements in the useof existing alternatives are feasible, andassume that the market response byfarmers is in some cases simply toabandon their fields.

EPA conducted an extensive review ofthe costs and benefits of its final action

on methyl bromide (see, "The Cost andCost-Effectiveness of the ProposedPhaseout of Methyl Bromide," EPA,1993). This'study includes the latestinformation on the costs andeffectiveness of potential newalternatives by the year 2001 and on thecosts and benefits of improvedutilization of existing alternatives. TheAgency estimates the total costs of aphaseout from 1994-2010 to be $1.7-2.3billion. The benefits analysis containedin this report reflects the keyassumptions about manmade emissions,impact on ozone of bromine, and likelygrowth in use absent regulations that arecontained in the Protocol assessmentupdate report. Based on this reasonableset of assumptions, EPA calculates thebenefits of the final rule phasing outmethyl bromide to be between $244 and$952 billion. (The benefits for thephaseout of methyl bromide between1994 and 2010 is between $14 and 56billion). These benefits result primarilyfrom avoided cases of non-melanomaskin cancer. The range in values resultsfrom different estimates for the valueassociated with a human life.

6. Group Assignment and Baseline YearWhenever a substance is added to the

list of class I substances, section602(c)(1) provides that the Agencyassign it to an existing group or createa new group. The Agency proposed tocreate a new group (Group VI) followingthe historical precedent of actions bothunder the Montreal Protocol and theCAA.

Since the Agency did not receive anysubstantive comments on this aspect ofits proposal, today's final rule adopts.that approach. For the reasonssummarized above and elaborated on inthe proposal, methyl bromide will belisted as Group VI within the list ofclass I substances.

EPA proposed using 1991 as the baseyear for determining the level at whichto set the production and consumptioncap. This was chosen because it is thelast year prior to discussions to regulatethis compound and therefore avoids thepossibility of companies increasingSroduction in an effort to increase theiraseline. The same reasoning was used

in setting the appropriate year for othersubstances covered in both the CAA andthe Montreal Protocol. The baselineestablished in the Montreal Protocol formethyl bromide is also 1991.

The only comment on this issuesupported this year as the baseline. Forthe reasons stated above, today's finalrule adopts 1991 as the baseline. In aseparate notice (58 FR 40048). EPA hadrequested data to support thedevelopment of both a 1991


consumption and production baselinesfor allocating allowances. EPApublished proposed allowances basedon 1991 levels on November 9, 1993 inthe Federal Register. The Agencyintends to publish final allowancesbefore the end of the calendar year inorder to implement the freezeestablished in this rule beginningJanuary 1, 1994.

In an important distinction betweenthe Montreal Protocol and this rule, EPAhas not excluded quarantine andpreshipment uses from its baseline andfrom the coverage of this regulation.Thus, the Agency intends to maintainrecords on both the baseline and annualproduction and consumption withoutthe exemption of quarantine andpreshipment uses as required under theCAA and with those exemptions asspecified in the CopenhagenAmendments to the Montreal Protocol.7. Interim Reductions and PhaseoutSchedule

EPA is obligated under the CAA toimpose the schedule of reductionscalled for in section 604 unless undersection 602(d) it can demonstrate thatsuch a schedule is unattainable. In itsplace, the Act appears to require theAgency to adopt the most stringentattainable phaseout schedule.

The proposed schedule for methylbromide was to freeze production in1994 and to maintain that level until the2000 phaseout. EPA's rationale behindthis schedule was that some near-termalternatives for methyl bromide existed,but for many of these, additional testingand government approval would berequired, which could take severalyears. Moreover, additional time isessential to allow for the testing ofnewly developed substitutes and toallow for a comparison of differentalternatives to determine which wouldbe most beneficial in terms of efficacyand in terms of impact on theenvironment.

The Agency received many commentson the issue of interim reductions. Onegroup of commenters urged the Agencyto make deep reductions in the earlyyears because of the availability ofsubstitutes and other methods ofreducing use. Many other commenterspointed to the lack of currently availablealternatives and argued against anyinterim reduction steps.

EPA recognizes that in some casesalternatives are already available andcould be shifted to in the near-term. TheAgency encourages methyl bromideusers to make these shifts. Moreover,recent requirements in California seek toreduce use and emissions throughreduced dosage, deeper injections and

thicker tarps in an effort to reduceambient exposures and reduce healthrisks. These efforts will also reduce use,as much as 10-20% according to onecommenter. However, the Agencyexpects that such reductions in use willprimarily serve to offset the historicgrowth rate in the use of methylbromide. While EPA encourages theseand other near-term efforts to reduce useand emissions, the Agency does notbelieve at this time that an adequatecase exists for relying on these measuresas the basis for interim cuts, and insteadbelieves that they will primarily offsetincreasing demand for methyl bromide.

While the Agency believes thatseveral alternative fumigants, includingsuch compounds as metam sodium,telone, and dazomet could be widelyused as replacements for methylbromide, it recognizes that some timewill be required for this shift to occur.Regulatory hurdles, equipmentmodifications, more extensive fieldtesting, and improved applicationtechniques are all reasons why theAgency cannot now conclude that amore stringent near-term schedule be unis-attainable. Furthermore, as discussed,many non-fumigant alternatives mayalso be viable options to replace methylbromide. These alternatives, includingsoil sterilization, crop rotation, andplant breeding, will take several years oronger to develop and evaluate. In order

to allow for these alternatives to be fullydeveloped and evaluated, and toprovide adequate time for regulatoryapprovals through EPA and USDA,today's final rule does not impose anyinterim reductions on production orconsumption of methyl bromide prior tothe phaseout.

Consistent with the provisions ofsection 602(d), today's final actionallows the full seven years after January1 of the year after the compound islisted for a phaseout. For the reasonsdiscussed earlier in this notice, thephaseout of methyl bromide would berequired by January 1, 2001 instead of2000 as proposed.

EPA received many comments callingfor EPA to allow the maximum timepermitted under the statute. Thesecomments generally argued that theadditional time is needed to allow forthe development and approval ofalternatives. Given the considerableuncertainties in knowing how long itwill take for a full complement ofalternatives to be developed andimplemented, the Agency believes itwould be prudent at this time to permitthe additional year prior to thephaseout. However, the Agency willcontinue to review the development andimplementation of alternatives and

could decide at some future date that anearlier phaseout is attainable.

8. Labeling

Today's rule does not directly dealwith labeling requirements undersection 611; once a compound is listedas class I, then labeling would berequired one year after the designationbecomes effective (see, 40 CFR 82.102).EPA has determined that activitiesinvolved in growing, harvesting, storingand transporting food are part of anagricultural process that falls outsidethe intent of Congress to require labelingon products "manufactured with" aclass I or II substance. Thus, containersof methyl bromide would be required tobe labeled beginning on January 1, 1995,but products treated with methylbromide would not require labeling.

EPA received comments bothsupporting this interpretation of itslabeling rule and arguing that labeling ofthese products was clearly intended byCongress and that providing thisinformation to consumers was preciselythe intent of section 611.

EPA recognizes that the generalpurpose of alerting consumers thatcertain goods were produced in amanner that may cause harm tostratospheric ozone could apply tocertain agricultural products for whichmethyl bromide is used. Nevertheless,the Agency believes that the section 611requirement that products"manufactured with" a class I or IIsubstance should reasonably beinterpreted to not apply to agriculturalproducts as such products are grownand not manufactured.

The ordinary sense of the phrase"manufactured with" does not includeagriculture. The dictionary defines"manufacture" to mean makingsomething made "from raw materials byhand or by machinery." (Webster'sNinth New Collegiate Dictionary(1983)). Fruits and vegetables aregenerally not made from raw materialsby hand or machinery. EPA furtherbelieves that labeling products raisesissues that Congress did not foresee inenacting section 611. For example,applying the labeling provision toagricultural products for which methylbromide is used is practically moredifficult than labeling of mostmanufactured products. Rawagricultural products are ordinarily notpackaged in the same-manner as othermanufactured products. In many if notmost cases, consumers purchase fruitsand vegetables without any packaging atall. Labeling such produce would beparticularly difficult.

65044 Federal Register / VoL 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations

9. Essential UsesEPA asked for comment in its

proposal on whether it has the statutoryauthority under section 604 to grantessential use exemptions for methylbromide. EPA received one comment onthis issue suggesting that it has suchauthority and that limits on essentialuses specified in section 604 deal onlywith those compounds already listedand should not in any way restrict theAgency's flexibility in crafting essentialuses for newly listed substances.Another commenter suggested that theAgency should go back to Congress forexplicit authority to grant essential uses.

EPA believes that it is premature atthis time to attempt to resolve this issue.If, as the phaseout date approaches, itbecomes clear that important uses arestill without substitutes, the Agencyanticipates it would seek an appropriateremedy.

V. Addition ofHydrobromofluorocarbons (HBFCs) tothe List of Class I Substances and to thePhaseout Schedule

In today's rule, the Agency is addinghydrobromofluorocarbons(HBFCs) asgroup VII, class I controlled substances.These chemicals have a parallelchemical structure to the HCFCs, withbromine atoms taking the place ofchlorine atoms. Multiple ODPs of thesechemicals were agreed to by the Partiesof the Montreal Protocol as part of the1992 Amendment which phases outthese compounds by January 1, 1996. Asexplained in other parts of this rule, theAgency expects these amendments toenter into force during the first fewmonths of 1994. The multiple valuescontained in the Protocol Amendmenton the ODPs of the listed HCFCs do notreflect scientific uncertainties. Theupper value of the ODP range providedis the estimate for the isomer with thehighest ODP, and the lower value is theestimate of the ODP for the isomer withthe lowest ODP. The Parties to theProtocol at their meeting in Copenhagenagreed that the ODP for these chemicalsshall be the upper value in the range,and that these chemicals should bephased out by January 1, 1996. All theupper ODP values for the HBFCs ODPsexceed 0.2.

As provided under section 602(e) ofthe Clean Air Act, the ODP of asubstance specified under section 602shall be consistent with the ODPspecified for that substance under theProtocol. Also section 602(a) providesthat the Administrator shall add to theclass I list all substances that theAdministrator determines to have anODP of 0.2 or greater. The Agency is

assigning ODPs to the HBFCs based onthe isomers with the highest ODP,consistent with the approach takenunder the protocol. Because such ODPsare above 0.2, the Agency is adding theHBFCs to the class I list. The Agencyhas assigned HBFCs.to group VII of theclass I chemicals.

Once listed, these chemicals aresibject to the phaseout schedulespecified in section 604 of the Clean AirAct. However, section 606(a)(3)provides authority for accelerating thephaseout of class I substances on thegrounds that the Montreal Protocol ismodified to include a schedule that Ismore stringent than the scheduleotherwise applicable under title VI.Section 614 provides that in case ofconflict between any provision of titleVI and any provision of the MontrealProtocol, the more stringent provisionshall govern. Therefore, the Agency isadopting the schedule agreed to by theParties in Copenhagen to phase outthese chemicals by January 1, 1996.

Furthermore, EPA had proposed. andtoday makes fnal,'a freeze on theproduction and consumption of HBFCs,starting January 1, 1994 at 1991 baselinelevels. The Agency is aware of only oneHBFC in production, HBFC-22B1, usedas a fire suppressant with an ODP of0.74. Use of this chemical is extremelylimited, and it is only manufactured byone company. As a result, EPA does not

- anticipate any significant economicconsequences from the phaseout ofHBFCs.

EPA published a Federal Registernotice requesting data on 1991Froduction and consumption of HBFCsfor the purposes of establishingbaselines and allowances. Based onresponses to that request, EPApublished proposed allowances onNovember 9, 1993, and intends topublish final allowances before the endof the year to implement the freezebeginning January 1, 1994.

VI. Trade Restrictions

A. Description of Proposed and FinalRequirements

In order to implement therequirements of the Clean Air Act, thedecisions of the 4th Meeting of theParties to the Montreal Protocol, and theLondon and Copenhagen Amendmentsto the Montreal Protocol, EPA proposedand is today requiring a number ofrestrictions on trade with foreign statesthat are not Parties to the Protocol or Itsamendments. The trade restrictionsbeing promulgated by this rule add toexisting trade restrictions promulgatedin 1990 (see 40 CFR 82.4(d)).Specifically, today's actions require a

ban on bulk exports of controlledsubstances from the U.S. of Annex Asubstances (Class I. Groups I and I1) toforeign states that are not Party to the1987 Montreal Protocol. While thisprovision will not be legally effectiveuntil the effective date of today'srulemaking, EPA had asked U.S.companies to comply with this tradeban. All indications suggest compliancehas occurred. Today's rule also imposesa ban on bulk imports and exports ofcontrolled substances listed in Annex Bto the Protocol (Class I, Groups IIL IV,and V) from and to foreign states,respectively, that are non-Parties to theLondon Amendment. While thisprovision also will not be legallyeffective until the effective date oftoday's rulemaking, EPA has asked allrelevant companies to ban the importand export of these chemicals effectiveAugust 10, 1993, the effective date ofthe relevant Protocol provision. Finally,today's rulemaking imposes a ban onimports from foreign states not Party tothe 1987 Montreal Protocol of specfiedproducts listed in Annex D to theProtocol that contain the controlledsubstances specified in Annex A (GroupI and II, Class I controlled substances).This provision will become effectiveJanuary 10, 1994. The EPA proposalnotified all companies of theapplicability of these provisions.

The Montreal Protocol provides, andEPA is also allowing an exception fromthe trade bans for foreign states that arenot Party to the Protocol, but have beendetermined by a Meeting of the Partiesto the Protocol to be in compliance withArticles 2A to 2E and 4 of the Protocol.This includes countries that havecomplied with the terms of decision IV/17c of the 4th Meeting of the Parties tothe Montreal Protocol, whichprovisionally determined complianceuntil the 5th Meeting of the Parties(November, 1993 Bangkok) for certainnon-Parties that submitted specifieddata by March 31, 1993. A list of thosequalifying countries can be found inappendix C. Annex 2 of this rule. Anupdated list of countries which areParty to the Protocol and itsamendments can be found in appendixC, Annex 1. Over the last severalmonths, the number of Parties to theProtocol has been increasing at arelatively fast pace. As a consequence,EPA will update the list of Parties to theProtocol every other month. Onecommenter noted that EPA must makethis list available as readily and easilyas possible. A dated list of ProtocolParties and Parties qualifying for anexemption from the Protocol's tradebans can be obtained by calling EPA's


Stratospheric Protection Hotline at 1-800-296-1996. The Agency will updatethis list every two months, andcompanies may trade with the newlyadded countries without EPArulemaking.

Finally, in the proposed rule, EPAasked for comment on whether theinformation requirements currently inplace for trade in bulk chemicals shouldbe applied to the importation ofcontrolled products. As noted below,one commenter stated that therecordkeeping and reportingrequirements discussed in the proposalwere unduly burdensome, and that EPAshould rely on U.S. Custom's records forthis information. EPA had not formallyproposed recordkeeping and hasdecided not to impose such informationrequirements. Since the publication ofthe proposed rule, the number ofProtocol Parties has risen from 91 to126, and there is every indication thatadditional Parties will be joiningshortly. The current list of countriescomplying with the Protocol includesall known producers, and since allProtocol Parties are under an obligationto ban the export of controlledsubstances to non-Parties, thepossibility that non-Parties would beproducing and exporting productswhich contain controlled substances isnarrow. Given these circumstances, EPAbelieves that it would be overlyburdensome to require such informationfor importation of controlled products.

B. Response to Major CommentsOne commenter misunderstood EPA's

description of the relationship ofTaiwan to the Montreal Protocol. In theproposed rule, EPA affirmed that thetrade provisions of the Protocol onlyapply to "a State not party to theProtocol," and noted that Taiwan,which did not fall under this Protocolcategory as a state, had nonethelesssubmitted data to the Protocolsecretariat indicating that it was incompliance with the control provisionsof the Protocol. The commenter askedfor clarification as to what action EPAwould take if Taiwan were found atsome future date to be out ofcompliance with those provisions.Should that situation arise, EPA wouldreview its options and would takeactions consistent with U.S. laws andpolicies to strongly encourage full andprompt compliance with the MontrealProtocol.

C. Legal AuthorityAs discussed in more detail in the

proposal, section 615 of the Clean AirAct provides EPA with the authority topromulgate these trade restrictions. That

section authorizes the Agency topromulgate regulations, if in theAdministrator's judgment, anysubstance, practice, process, or activitymay reasonably be anticipated to affectthe stratosphere and such effect mayreasonably be anticipated to endanger9 ublic health or welfare. These trade

ans imposed by this rulemaking wouldprevent shipments of ozone depletingsubstances from the U.S. to countrieswith no regulatory infrastructure tocontrol their use. Limiting access in thisway will reduce their release of suchsubstances into the atmosphere, thereby,reducing effects on public health andwelfare. Moreover, the bans on importsto the U.S. from non-Party foreign statesof controlled substances and productswould help discourage shifts ofproduction to non-Party foreign states tothe Protocol by eliminating the U.S. asa market for such production.

D. DefinitionsAs proposed, in this final rule, EPA

has further defined Parties to theProtocol in the regulation to distinguishParties complying with the original1987 Montreal Protocol, the 1990London Amendments and the 1992Copenhagen Amendments.

E. Foreign States not Party to theProtocol

Article 4 of the Montreal Protocolprovides foreign states which are notParty to the Protocol with a mechanismto demonstrate compliance with keyProtocol provisions and seek exemptionfrom the Protocol's trade measuresagainst non-Parties. Specifically,paragraph 8 of Article 4 states that tradewith non-Parties will be permitted if ameeting of the Parties finds those statesto be in full compliance with Articles 2,2A to 2E and 4 of the Protocol. It isanticipated that once granted, suchstatus will be reviewed by eachsubsequent meeting of the Parties toensure continuing compliance with therelevant Protocol provisions.

At the 4th Meeting of the Parties, theParties reviewed the data submission ofColombia, and based on theirdemonstration of compliance, decidedto suspend measures against that non-Party. Additionally, by Decision 4/17C,the Parties decided to determineprovisionally, pending a final decisionat the 5th Meeting of the Parties, thatany foreign state non-Party to theProtocol which submitted data byMarch 31, 1993, was in compliance withthe relevant provisions and could beexempt from the trade restrictions untilthe 5th Meeting of the Parties when thatdata could be reviewed. Fourteen non-Parties to the Montreal Protocol

submitted data based on that decision.Additionally, eight non-Parties to theLondon Amendment to the Protocolsubmitted data. Due to the timing oftheir submissions, EPA was not able tolist in the proposed rule those countrieswith interim status as a Foreign Statenot Party to the Montreal Protocol butcomplying with Montreal Protocol and/or the London Amendment.VII. Changes in Definition ofProduction

A. Definition of ProductionIn the March 18 proposal, EPA

proposed to define "production" as themanufacture of a controlled substancefrom any raw material or feedstockchemical, but not to include: "(1) Themanufacture of a controlled substancethat is subsequently transformed; (2) thereuse or recycling of a controlledsubstance; or (3) amounts that aredestroyed by the approvedtechnologies." The current definition of"production" excludes controlledsubstances that are, subsequentlytransformed and the reuse or recyclingof a controlled substance.

In today's rule, in response to avariety of comments to be discussed inthis section, the definition of productionis revised to mean "the manufacture ofa controlled substance from any rawmaterial or feedstock, but does notinclude:

(1) The manufacture of a controlledsubstance that is to be subsequentlytransformed;

(2) The reuse or recycling of acontrolled substance;

(3) The manufacture of a controlledsubstance that is subsequentlydestroyed by one of the five approvedtechnologies, to the extent thatdestruction is considered to haveoccurred under this rule; and

(4) Controlled substances that arevented or spilled unintentionally."

Several commenters indicated thatafter the phaseout, productionallowances would no longer be availableto produce controlled substancesintended to be transformed ordestroyed, using the current system ofexpending production allowances andapplying to EPA to receive allowancereimbursement for controlledsubstances that are transformed. Inresponse to those comments, along withrevising the definition of production,EPA is also revising its approach torequiring production and consumptionallowances in cases where controlledsubstances are to be transformed ordestroyed.

Under today's rule, production andconsumption allowances are required


only for the "production" of controlledsubstances that will result in emissiveuses. As a result, producers of ozone-depleting chemicals that are to be usedas feedstock do not need to expendallowances to manufacture thesechemicals. That is also true forproducers of such substances that aremanufactured for production processesthat will result in their destruction.Similarly, allowances are not requiredwhen importing reused or recycledsubstances. The changes in thedefinition of production will serve tofacilitate business operations byeliminating the need for EPA'spaperwork related to refunding andtrading allowances in these limitedsituations. The Agency believes thatthese changes will assist industry intheir business operations, but have nosignificant impact upon the ozone layer.

1. Transformationa. Changes in Treatment of

Transformation. Under the currentregulations, producers expendproduction and consumptionallowances when producing andimporters expend consumptionallowances when importing controlledozone-depleting substances (except forcarbon tetrachloride produced as afeedstock). When the chemicals are soldto a second party and subsequentlytransformed, new allowances areprovided to that second partytransformer upon request. Theseallowances are then traded back to the

rducing company by the transforming

Several commenters, althoughagreeing with the proposed definition ofproduction, indicated that the currentadministrative procedures for dealingwith transformation and destructionunder the allowance system should bemodified. Since, only after a companytransformed the controlled substanceand submitted documentation to EPAthat transformation occurred, wouldEPA "refund" those allowancesexpended, commenters indicated thatallowances should not be required forthe production of ozone-depletingsubstances that are to be transformed ordestroyed.

Commenters further indicated thatthese requirements pose significantburdens upon industry. The paperworkand staff time, both for industry andEPA. to grant and trade allowances isexcessive, and it may be months beforea producer had allowances returned.The EPA recognizes that as the numberof allowances becomes smaller with theannual reduction schedule, producerswill become hard pressed for availableallowances. It Is not EPA's intent to

hinder business operations that areallowed under the Montreal Protocol(i.e., production for transformation is*not limited). Finally, EPA recognizesthat under the current program, nomanufacturer could produce past 1995except for essential uses and exports toArticle 5 countries, since no allowanceswill be available.

Consequently, EPA's procedures ofthe allowance system for ozone-depleting substances are now changed.In essence, the Agency is now extendingthe system previously applicable only tocarbon tetrachloride transformation toother controlled substances. Becausecontrolled substances that aretransformed are excluded from thedefinition of production, producers thattransform or sell to purchasers thattransform do not need allowances forsuch production. Companies that buythese chemicals for transformationpurposes will no longer need to requestallowance redemptions oncetransformation has occurred, and thuswill no longer need to trade thoseallowances back to the producers. Thischange would be imperative once U.S.production and imports of controlledsubstances is fully phased out. Withoutsuch changes, companies would beunable to produce controlled substancesthat were to be transformed or laterdestroyed after use.

The Agency does recognize that someproduction may have been intended foremissive uses and allowancesexpended, to produce those chemicalsbut they are later transformed. In thesecases, EPA intends to allow persons toredeem those allowances where'personscertify that transformation has occurred(see discussion on certifications below).

b. Recordkeeping and ReportingChanges Relative to Transformation. Inaddition to the simplification of theprogram to eliminate the unnecessaryrequesting and trading of allowances,EPA will require only annual reportsfrom companies that transformed ozone-depleting chemicals. To tracktransformation on a quarterly basis, EPAwill rely upon producers' quarterlyreports which will record the volume ofchemical sold for transformations. TheAgency found tracking transformationbetween producers' reports andtransformers' reports difficult.Generally, chemicals, once produced,are sold, used, or put Into inventory. Insome cases, companies will stretch outinventory over years. This makes itdifficult for EPA to match productionintended for transformation to when itis actually consumed or transformed.Consequently. EPA has decided toeliminate the transformer's quarterlyreport. However, EPA has not

eliminated recordkeeping by companiesthat consume these chemicals asfeedstock. EPA will audit transformersto ensure compliance with therequirements of this regulation.Transformers must maintain thefollowing records as is currentlyrequired under the existing program:dated records of the quantity and levelof each controlled substancetransformed; copies of the invoices orreceipts documenting the sale ortransfer of the controlled substance tothe person; dated records of the names,commercial uses, quantities of theresulting chemicals, and dated recordsof shipments to purchasers of theresulting chemicals; dated records of allshipments of controlled substancesreceived by the person, and the identityof the producer or importer of thecontrolled substances; and datedrecords of inventories of controlledsubstances at each plant on the first dayof each quarter.

Companies that purchase class Icontrolled substances and thentransform those controlled substancesmust report the annual volumetransformed within 45 days of the endof the control period.

In the case where production and/orconsumption allowances are expendedand the substance is later transformed,a person who transforms may receiveallowances for transformation ofcontrolled substances. The person mustsubmit the following information: theidentity and address of the person whotransformed the substance; the quantityand level of controlled substancetransformed; a copy of the invoice orreceipt documenting the sale of thecontrolled substance; the name, quantityand verification of the commercial useof the resulting chemical transformed;and signature of the certifying party,The person must also certify that theproduction of the controlled substanceexpended either production and/orconsumption allowance. The Agencybelieves that this information isnecessary to ensure that transformationhas occurred.

2. DestructionIn today's action, the Agency is

implementing in its regulation a recentdecision of the Parties in Copenhagenthat addressed destruction (Decision IV/11), removing controlled substances tobe destroyed under certain conditionsfrom the definition of "production." Aswill be described below, EPA believesthat the implementation of this decisionis consistent with House-SenateConferbnce Report that accompanied theClean Air Act Amendments of 1990, andwill provide more clarity as to the


definition of production and theconditions under which destruction isallowed. Today's rule eliminates fromthe definition of production thoseozone-depleting chemicals that are to bedestroyed, similar to the manner inwhich transformation of such chemicalsfalls outside of the definition ofproduction. The Agency believes thatthis change poses insignificantenvironmental harm and lessens theadministrative burden of the currentregulation.

a. Elimination of CoincidentalUnavoidable Byproducts Provision. As aresult of actions by the Parties to theProtocol regarding destruction, the needfor the current coincidental unavoidablebyproducts (CUBP) provision iseliminated. Under the currentregulations, that provision allows for anexemption from production restrictionsfor any controlled substance that is acoincidental unavoidable byproduct andis subsequently contained anddestroyed by the maximum achievablecontrol technology, or MACT. Withtoday's rule eliminating those quantitiesof controlled substances destroyed fromthe definition of production, the CUBPprovision becomes unnecessary andduplicative. Therefore, as proposed,today's rule deletes the CUBP provisionof the current phaseout regulations.Commenters supported the striking ofthe CUBP provision, given the treatmentto be afforded through the destructionand insignificant quantities (seediscussion below) provisions outlinedin the proposal andfollowed through intoday's final rulemaking.

b. Destruction-Background. Underthe existing Protocol, "production" ofcontrolled substances is defined as "theamount of controlled substancesproduced, minus the amount destroyedby technologies to be approved by theParties." At the Fourth Meeting of theParties to the Montreal Protocol, theParties approved five destructiontechnologies to be used for destroyingcontrolled substances.

With the approval of the fivedestruction technologies-liquidinjection incineration, reactor cracking,gaseous/fume oxidation, rotary kilnincinerators, and cement kilns, Partiesto the Protocol can now subtract fromthe definition of production that amountof controlled substance(s) that isdestroyed by these means, under certainconditions discussed below.

Liquid injection incinerators aretypically single-chamber units withwaste burners. They may also includeliquid injection stages of a multiple-chamber incinerator. These incineratorsare used to destroy wastes with a lowash content and can be used to destroy

sludge, slurry, vapor, or combustibleliquid. Liquid wastes are burned insuspension after being injected throughburners and atomized to fine droplets.

A reactor cracking process uses acylindrical graphite, water-cooledreactor and an oxygen-hydrogen burnersystem. Since 1983, this process hastreated waste gases resulting from theproduction of CFCs. The gases areconverted to hydrofluoric acid,hydrochloric acid, carbon dioxide,chlorine, and water. The two acids areusable in-house and/or marketable, andthe chlorine is scrubbed, leaving onlywater vapor, oxygen, and carbondioxide as waste gases.

Gaseous/fume oxidation destroyswaste vapor streams, most often volatileorganic compounds. A combustiontemperature of around 1100 degreescentigrade is needed to destroy mostozone-depleting compounds. Acid gasscrubbers are required for incinerationof halogenated waste vapors, such asthose from controlled substances. Fumeincinerators can be direct flameincinerators, consisting of thecombustion chamber and a burner, orrecuperative fume incinerators that useheat exchangers to preheat the wastevapor feed stream or the combustion air.Fume incinerators are usually found inchemical process or manufacturingplants.

Rotary kiln incinerators can handle awide variety of both solid and liquidwastes. Rotary kiln incinerators*typically have at least two combustionchambers, the afterburner ensuring thatcomplete combustion of exhaust gasestakes place. Liquid wastes can be fedeither into the rotary kiln area ordirectly into the afterburner chamber. Iffed into the afterburner chamber, theliquid is atomized in the burner orcombustion zone.

Cement kilns, under proper operation,can destroy most organic chemicalwastes. Tests have been conductedusing CFC-113, with a destructionefficiency of greater than 99.99 percentdemonstrated. Destruction of ozone-depleting substances in cement kilnsappears beneficial.

c. Definition of Destruction/Change inDefinition of Production. In today'srulemaking, the Agency defines"destruction" as "the expiration of acontrolled substance to the destructionefficiency actually achieved, unlessconsidered completely destroyed asdefined by this section. Suchdestruction does not result in acommercially useful end product anduses one of the following controlled

rocesses. . ." The Agency believes itas the authority to develop this

definition to be consistent with the

Protocol. While section 601 (11) of theCAA does not require EPA to excludequantities of controlled substances thatare destroyed from the definition of"production," EPA believes it has thediscretionary authority to exclude fromthe definition of "production"controlled substances that are destroyedthrough the use of the technologiesapproved by the Protocol Parties at theCopenhagen meeting. Section 601 (11)provides that the terms 'produce','produced', and 'production', refer tothe manufacture of a substance from anyraw material or feedstock chemical, butsuch terms do not include amounts ofsubstances that are transformed orreused.

EPA notes that the Conference Reportof the 1990 Clean Air Act Amendmentsstated that the "conference agreementdoes not include a requirement toconstrue the term 'production' in amanner consistent with the Protocol.The Protocol's exclusion formanufactured substances that aresubsequently destroyed is too broad anddoes not include adequate safeguards topreclude abuse." The Conference Reportthen proceeded to state that "[in thecourse of implementing this Act,however, EPA shall consider whether anexclusion will be allowed on a case-by-case basis for the manufacture ofcontrolled substances that are: (1)Coincidental, unavoidable byproductsof a manufacturing process; and (2)immediately contained and destroyedby the producer using maximumavailable control technologies." EPAproceeded to establish a process thatexempted such production as CUBP, asdiscussed above, in the July 30, 1992final rule (57 FR 33754).

While section 601 (11) of the CAAdoes not contain language requiringEPA to follow the Protocol in terms ofexcluding destroyed controlledsubstances from production, it also doesnot contain language precluding EPAfrom following the Protocol Parties'approach to destruction. Moreover, theConference Report assumes that EPAhas the authority to exclude quantitiesthat are destroyed from production.Otherwise, Congress could not havedirected EPA to consider excluding onlycertain types of destroyed production.EPA believes that while it is notrequired to follow the approach of theProtocol Parties regarding destruction, ithas the authority to do so at thist uncture because the approach adopted

y the Parties, in specifically approvingthe five destruction technologies,adequately satisfies the concernsexpressed in the Conference Report.Those concerns were expressed at atime when it was not known how the


Parties would treat destruction; byspecifically approving these fivetechnologies, the Parties have satisfiedthe concern of the House-SenateConference Committee that theProtocol's exclusion associated withdestruction is too broad. Furthermore,by requiring reliable documentation ofthe amount destroyed, EPA'simplementing regulations furtheraddss the concerns raised in theconference language.

The Agency believes that with theadoption of this definition ofdestruction, a modified definition ofproduction consistent with theProtocol's decision to approve the fivedestruction technologies, and therecordkeeping and reportingrequirements described below, theconcern regarding destruction expressedin the Conference Report language Is

A adequately addressed.d. Treatment of Destruction. Today's

rule, with its definition of destruction,treats destruction in a manner parallelto the treatment of transformation inthis final rule. Those substances that areproduced for use in productionprocesses that result in theirdestruction, using one of the fiveapproved destruction technologies, areexempt from the definition ofproduction. Therefore, production andconsumption allowances are notrequired for production and importationof controlled substances that are to bedestroyed.

It is important to note that EPAmodified the method adopted in thisrule for treating transformation andthus, destruction, from the proposedrule in response to comments. Whileproducers or importers transforming ordestroying carbon tetrachloride wouldnot have been required to holdallowances to produce or import underthe proposal, producers and importersof other controlled substances, and non-producers were required to apply forallowance credits after transformation ordestruction had taken place. EPA madethis decision due to the number ofcomments it received requesting thistreatment. The Agency believes that aslong as there are adequate safeguards toensure that the chemical is eventuallydestroyed, then this administrativechange would have no impact on theenvironment. The Agency hasacknowledged that these requirementswould have needed amending toimplement the complete phaseoutsuccessfully. In today's final rule, incases where the producer or an importerknows that any controlled substance isto be transformed or destroyed by theproducer or importer itself or by a non-producer of the controlled substance,

that substance will not fall under thedefinition of "production" and"consumption," negating therequirement for production and/orconsumption allowances.

This rule does allow persons otherthan producers or importers to receiveallowances when they destroy thecontrolled substance. Where allowancesare expended in producing a substancethat is sold for emissive use and thatsubstance is later destroyed by one ofthe five approved technologies, the finalrule is requiring that a certification besubmitted to the Agency by the personrequesting the allowances whodestroyed the substance that allowanceshad been expended for the productionor import of this controlled substance.

The person requesting theseallowances should provide thefollowing information: the identity andaddress of the person who destroyed thesubstance; the name, quantity andvolume of controlled substancedestroyed; copy of the invoice or receiptdocumenting the sale of the controlledsubstance to the person; and thedestruction unit's efficiency. Finally,the person shall submit a certificationthat allowances had been expended forthe production or import of thiscontrolled substance. The Agencybelieves that this information, similar tothe information required for receipt ofallowances for transformation, isnecessary to ensure that destruction hasoccurred.

As will be discussed below, EPA isalso requiring that each person whointends (knowing at the time ofpurchase) to destroy controlledsubstances submit to the producer orimporter from whom they purchasethose substances a verification that thesubstances they purchase will bedestroyed. The purchaser or importerwill keep this verification on file. Alsodiscussed below, EPA is requiring thata one-time report be submitted by thosewho destroy controlled substances,stating the destruction unit's destructionefficiency and the methods used torecord the volume destroyed and thoseused to determine destruction efficiencyas well as other federal or stateregulations governing the destructiontechnology. The combination of thesetwo one-time (unless information inverification or report changes)requirements will supply adequateinformation to EPA and to the producer/importer, such that destruction can beconfirmed. This will minimize theamount of information the persondestroying will need to submit to theproducer/importer after substances areactually destroyed.

All companies that destroy class Icontrolled substances must reportvolume destroyed during the controlperiod within 45 days of the end of thecontrol period.

As will be explained in greater detailbelow, a substance will be consideredcompletely destroyed if it is destroyedby one of the five technologies at ademonstrable destruction efficiency of98 percent or greater. Substancesdestroyed by one of the fivetechnologies at a destruction efficiencyof less than 98 percent will beconsidered destroyed only to thatpercentage; thus, only that percentage ofthe substance that is to be destroyedwill be exempt from the definition ofproduction. The remaining percentagewill fall under the definition ofproduction and thus require productionand/or consumption allowances toproduce or import.

This differs slightly from thetreatment of transformation in this finalrulemaking, in that substancestransformed, meaning entirelyconsumed except for trace quantities,are exempt from the definition ofF roduction. There are no provisions foress than full transformation, except for

trace quantities. A destructionexemption can be obtained, however,for whatever percentage is demonstratedto be destroyed by one of the approvedtechnologies.

e. Response to Major Comments. EPAreceived numerous comments relative toits proposal to grant credits or exempta controlled substance from thedefinition of "production" fordestruction of the covered substances.Of those, only one stated that theAgency should not grant such credits orexemptions. The specific concern of thiscommenter centered around thepotential ability of a company totransfer production credits amongchemicals. According to the commenter,if a company had a surplus of onesubstance, destroyed that surplus,received credits, then used those creditsto produce another substance, theAgency could be creating a disincentiveto move out of those substances.

In this final rulemaking, EPA allowstransfers of allowances to occur onlywithin a Group (eg., Group I, whichincludes CFC-11, -12, -113, -114, and-115). CFC allowances could not betraded for halon credits, as thiscommenter suggested. (Indeed,production of halons will be phased outin 1994, and therefore, no trades wouldoccur among individual halons.)Additionally, all transfers of allowancesamong chemicals within a group mustbe adjusted according to the ODP ofeach substances. The Agency thus


believes that, even in the event of anunlikely scenario described by thecommenter, the implementation of thesedecisions will result in noenvironmental damage, yet willminimize disruptions for companiesthat require controlled substances pastthe phaseout date.

Companies will only receive adestruction exemption for the volume ofcontrolled substances that have beendestroyed by one of these five approveddestruction technologies, unless a 98percent or greater destruction efficiencyis achieved; only then would a fulldestruction exemption be granted.Because the environmental goal of thisrule, as well as the whole of title VI, isto minimize and ultimately eliminateemissions of ozone-depleting chemicals,treating destruction in the same manneras transformation is treated in this finalrule merely recognizes a process thatdestroys potential emissions of thesesubstances consistent with theseenvironmental goals.

The Agency received commentsclaiming that it is unreasonable toexclude from the definition ofdestruction those processes where heator energy that may be commerciallyuseful is produced as a byproduct ofdestruction. EPA agrees. The intent ofthe destruction process is to destroy thesubstance, for which a byproduct in theway of heat or energy may be produced,rather than production of an endproduct being the goal of the destructionactivity. Heat or energy are in factpotential byproducts of the process ofdestruction, rather than end products ofthe substance(s) itself. Therefore, EPAdoes not consider heat or energyproduced as a byproduct of destructionto be considered an end product. As aresult, the production of heat or energyas a byproduct of an approveddestruction technology under thissection does not preclude the substanceor substances from falling under thedefinition of destruction.

One commenter suggested that theAgency clarify that any otherdestruction process that is laterapproved by the Parties to the Protocoland added to this list of five destructiontechnologies should also be deemed anacceptable destruction technology underthis rule. While EPA does not believe itappropriate to authorize the use of asyet unapproved destructiontechnologies, it intends to proposeauthorizing use of additionaldestruction technologies through futurerulemakings, as such technologies areapproved by the Parties.

Another commenter pointed out that,although listed properly in thePreamble, the regulatory text of this

rulemaking listed the destructiontechnologies incorrectly, splitting outliquid injection incineration into twotechnologies-liquid injection andincineration. The regulatory text hasnow been corrected to include liquidinjection incineration as onetechnology.

One commenter stated that controls ofemissions of these substances byproduct recovery devices should betreated in the same manner asdestruction via one of these fiveapproved technologies. Anothercommenter stated that RCRA boilers andindustrial furnaces should also becovered by the exemption. Both claimedthat the end results would beavoidances of emissions. In keepingwith the intent of Congress, whereconcerns centered around too broad anexemption of a substance from thedefinition of production as a result ofdestruction, and in maintainingconsistency with the decision reachedby the Parties to the Protocol, theAgency is today allowing destructionexemptions only for those fivedestruction technologies approved bythe Parties.

Another commenter requested thatEPA clarify that an incidental use of asubstance prior to destruction,adequately contained so as to preventany emissions, not disqualify it fromreceiving destruction credits/exemptions. EPA expects that thesesubstances will be used in a productionprocess prior to being sent fordestruction. Consequently, where usesof a substance occur in a containedenvironment and that substance issubsequently destroyed, the destructionexemption described in this sectionwould apply.

Another commenter requested thatthe Agency clarify that off-site disposalis equally acceptable in takingadvantage of this destruction credit. Ifhandled according to applicablerequirements, off-site destructionshould ensure the same environmentalbenefits as on-site destruction.Consequently, as long as therequirements of this section are met,including all reporting andrecordkeeping requirements, off-sitedestruction will be treated in the samemanner as on-site destruction.

A commenter expressed concern overthe manner in which fugitive emissionsare treated and accounted for. EPA hasnot counted fugitive emissions ofcontrolled substances in its currentdefinitions of "controlled substance" or"production." The Agency believes that,with the accelerated phaseout of thesesubstances, the higher costs associated,and general operational efficiency

concerns, producers and manufacturershave economic incentives to reducefugitive emissions of controlledsubstances to a minimum. Additionally,major sources under section 112 of theClean Air Act will have requirementsimposed that will necessitateminimizing emissions of coveredcontrolled substances. For thesereasons, in keeping with past practice,fugitive emissions are not included intoday's definitions of "controlledsubstance" or "production." If EPA'sexpectations turn out to be wrong, andfugitive emissions are not kept to aminimum, EPA will revisit the matter ina subsequent rulemaking.

f. Degree of Exemption/CreditAfforded for Destruction.Under thecurrent regulations, companies couldonly claim the CUBP exemption forcarbon tetrachloride and methylchloroform destroyed at a 99.99 percentefficiency. The Agency had developedthis destruction efficiency for these twochemicals, as well as others, when theywere characterized as hazardous wastesunder 40 CFR 343(a) and 40 CFR266.104, pursuant to the ResourceConservation and Recovery Act (RCRA,42 U.S.C. 6901 et seq). In the July 30,1992 rulemaking for the protection ofstratospheric ozone (57 FR 33754), theAgency adopted this definition ofMACT in § 82.4(e)(1)(v) to exempt CUBPfrom production limits. However,today's rule eliminates the CUBP

ovision and the Agency has nowcused on developing standards for

destruction of controlled substances inorder to exempt those substances fromthe definition of "production," makinguse of the Agency's experiences withMACT under the CUBP provision,RCRA regulations, and proposed CAAsection 112 regulations.

Under RCRA, the Agency currentlyrequires that industries that incineratehazardous waste covered by the RCRAregulations meet "at stack" standards of99.99 percent, or four nines. In additionto these "at stack" standards, RCRA alsoestablishes performance standards tocontrol fugitive emissions of hazardoussubstances which can occur at otherpoint sources, such as waste storagefacilities (§ 264.345(d)). While there arecurrently no quantified controls for suchemissions, EPA is developing suchstandards for point sources under theCAA section 112 rule.

Of the substances regulated by RCRA,the only controlled substances coveredare methyl chloroform and carbontetrachloride. The remaining controlledsubstances are regulated under RCRAonly when they are blended with

-hazardous waste, such as used solvents,and incinerated.


The Agency is today making availablethe granting of full exemption from

roduction, or full allowance credits,ased on the destruction of controlled

substances when they are covered by,and operated in compliance with, RCRAsection 343(a) and 40 CFR 266.104. Ifthe Agency were to exempt from thedefinition of production only thatvolume destroyed, 99.99 percent in thecase of RCRA permitted facilities, thecompany would never be able to redeemthe full amount of the chemical used,and would eventually be unable toobtain sufficient volumes to operateefficiently.

Under some situations, thesechemicals are not covered by RCRAregulations, but will be covered byregulations to be promulgated undersection 112 of the Clean Air Act. TheAgency published a proposed rule(known as the Hazardous OrganicNESHAPS [HON] rule) on December 31,1992 (57 FR 62608) to implementsection 112, stating that companies arerequired to control air emissionsoccurring in chemical manufacturingprocesses to the established MACTlevels. The HON proposal coversapproximately 400 manufacturingprocesses associated with the SyntheticOrganic Manufacturing Industry(SOCMI), as well as seven non-SOCMIsource categories. The Clean Air Actcontained a list of 189 hazardous airpollutants (HAPS) of which a portionare known to be emitted by the abovementioned industries. Of those listed,the only controlled substances aremethyl chloroform (MCF), carbontetrachloride (CC14) and methyl bromide(listed as a class I substance in today'saccelerated phaseout rule).

The HON proposal covers five kindsof emission points within such facilitieswhere these substances are emitted,including process vents, wastewaterstreams, transferl operations, storagetanks, and equipment leaks. The Agencyproposed that each emissions sourcewould require a "reference controltechnology" with specific applicabilitycriteria, such as a 98% controlefficiency with vapor incinerators forprocess vents and 95% for storage tanks.The HON proposes performancestandards for operating the technologies,as well as criteria for the design of thecontrol equipment.

The Agency proposed that whenorganic hazardous air pollutants arereleased through process vent sources,companies may route these emissions toa gaseous/fume oxidation incinerator fordestruction. The Agency has proposedthat such incinerators operate with anefficiency of 98 percent.

For the purposes of this rulemaking,the Agency establishes that when otherregulations apply, such as onesprohiulgated under section 112 of theClean Air Act, rather than RCRA, andthe 98 percent destruction efficiency isachieved by vapor incinerators to whichemissions of controlled substances arerouted, the Agency will grant the fullexemption or allotment of allowancesfor substances that are destroyed underthese conditions.

Several commenters claimed thatthere may be situations whereby adestruction efficiency of at least 98percent is achieved through one of theapproved destruction technologies, butthe process does not fall under thejurisdiction of RCRA or section 112regulations. In such cases, thecommenters argued, the full exemptionfor destruction should be granted. EPAagrees. EPA recognizes that there maybe a situation in which, for example, afacility in which destruction at or abovea 98 percent efficiency level takes placeis not a major source and thus, is notcovered by section 112 regulations-noris it regulated under RCRA for thedisposal of hazardous wastes. Therefore,if a facility using one of these approveddestruction technologies does not fallwithin the jurisdiction of RCRA orsection 112 regulations, but achieves atleast a 98 percent destruction efficiencyand fulfills the requirements of thissection (which include documentationof destruction efficiency and themethods for determining thatefficiency), a full exemption can begranted for destruction.

Another commenter requested thatthe Agency define "completely destroy"in order to clarify situations in whichfull credit will be granted throughdestruction of these substances.Consequently, EPA has added adefinition of "completely destroy"which covers destruction of 98 percentor greater of the substance that is sentfor destruction, using one of the fiveapproved destruction technologies.

The Agency recognizes that these fiveapproved destruction technologies,although capable under test situations ofdestroying controlled substances at a99.99 percent efficiency rate, may not beas efficient as is required for carbontetrachloride and methyl chloroformcovered under either RCRA or theproposed section 112 regulations. If thedestruction efficiency in destroyingthese controlled substances, includingcarbon tetrachloride and methylchloroform, is below 98 percent, thenEPA will exempt from production onlythose volumes that have indeed beendestroyed. For example, if an approvedtechnology destroys only 80 percent of

the chemical, then the Agency will onlyexempt the portion destroyed from therequirement to hold productionallowances. Under such a program,companies that do not completelydestroy their controlled substanceswould be unable to recoup, throughallowances, their full volume ofcontrolled substances needed to operate.Once the phaseout occurs, suchcompanies will need to destroy close to100 percent of the controlled substance,depending on technical limitations, inorder to continue to operate at intendedcapacity.

g. Standards for Destruction. In caseswhere a destruction unit falls under thejurisdiction of RCRA or section 112regulations, standards are required forthose units pertaining to destructionefficiency, combustion efficiency, flow,monitoring, etc. For purposes of thisrulemaking, those units must fulfill therequirements of the relevant regulationsunder which they are otherwiseregulated; the Agency finds no rationalefor developing additional standards forthe destruction of such controlledsubstances in these regulations.

In cases where a destruction unit isnot covered by one of these otherregulations, consistent with the decisionof the Parties to the Protocol, theAgency encourages the adoption of theminimum standards and subsequentrecordkeeping requirements set forth inchapter 5.5 of the Ad-Hoc TechnicalAdvisory Committee on ODSDestruction Technologies as theminimum requirements to be met underthis section. The Ad-Hoc TechnicalAdvisory Committee on ODSDestruction Technologies presents a listof minimum standards for pollutantsemitted during destruction with stackconcentrations for hydrochloric acid,hydrofluoric acid, particulate, andcarbon monoxide.

The report entitled, Ad-Hoc TechnicalAdvisory Committee on ODSDestruction Technologies, alsorecommends that atmospheric releasesof controlled substances shall bemonitored at all facilities with airemission discharges. For controlledsubstances, this report recommends useof flow meters or continuouslyrecording weighing equipment forindividual containers. The Agencyrecognizes that flow meters are notalways compatible with certainequipment. However, EPA requires thata means be available with which tomonitor potential releases and actualdestruction. Therefore, where flowmeters or continuously recordingweighing'equipment is not feasible, at aminimum, containers are to be weighed


"full" and '!empty" to establishquantities destroyed.

h. Comments on Reporting andRecordkeeping Associated withDestruction. The Agency is requiring,consistent with the proposal, thatproducers or importers of controlledsubstances for use in a productionprocess that will result in destruction,using one of the approved technologies,maintain dated records of the quantityof controlled substances produced andsold for use in processes that result indestruction, and any applicableverifications from purchasers that thesubstance is to be destroyed. TheAgency requires this recordkeeping inorder to verify exemptions fromproduction due to destruction.

Also consistent with the proposal,producers and importers of controlledsubstances must report to the Agencythe amount of that substance sold toeach person who then subsequentlydestroys the chemical and anyapplicable certification showing that thepurchaser of the controlled substanceintends to destroy the chemical.

Companies that both producecontrolled substances and destroy thosesame substances must report the volumedestroyed on their quarterly productionreport in a manner similar to thatrequired for transformation. The finalrule requires the same recordkeeping ofpersons who purchase controlledsubstances and subsequently destroythem as those outlined in the proposal.

The Agency received commentsexpressing concern that IRS certificatesindicating feedstock use do not addressthe issue of destruction, making thecertificates meaningless as a reportingrequirement for destruction. None of theIRS certificates relating to controlledsubstances require information on thosesubstances intended to be destroyed oractually destroyed. Consequently, thesecertificates are useful for substances tobe transformed, but not for those to bedestroyed. As a result, EPA is requiringpurchasers who intend to destroy'controlled substances to provideproducers or importers from whom theypurchase a one-time verification (unlessany aspect of the information in theverification changes, thus requiring arevision) that includes the followinginformation: the identity and address ofthe person intending to destroy thesubstance; indication of whether thosecontrolled substances will becompletely destroyed, as defined in§ 82.3 of this rule, or less thancompletely destroyed, in which case thedestruction efficiency at which suchsubstances will be destroyed must beincluded; period of time over which theperson intends to destroy controlled

substances; and signature of thecertifying party. The Agency believesthat this information, similar to the

-information required for receipt ofallowances for transformation, isnecessary to ensure that destruction willoccur. Without such verificationinformation, a determination that thesubstances are to be destroyed and thatthe producer is thus able to avoidexpending production allowances forsuch substances would not be possible.

Companies that purchase controlledsubstances that are subsequentlydestroyed must keep the followingrecords: the identity and address of theperson destroying the substance; thequantity and level of controlledsubstance destroyed; a copy of theinvoice or receipt documenting the saleof the controlled substance; datedrecords of substance received by theperson and the identity of the personfrom whom the controlled substancewas purchased; dated records ofinventories of controlled substances ateach plant on the first day of eachquarter; and a copy of the certificationof intent to destroy, if applicable.

Several commenters stated that theproposed reporting and recordkeepingrequirements, complemented by therecordkeeping requirements of otherapplicable regulatory regimes, wouldsuffice for purposes of this section, andthat more detailed requirements thanwhat was proposed would beduplicative and unnecessary. Asdiscussed above, these approveddestruction technologies are oftenregulated under other statutes, such asRCRA, or are expected to be regulatedunder section 112 of the Clean Air Act.The implementing regulations for thesestatutes have detailed recordkeepingand reporting requirements to ensurethat destruction has taken place. TheAgency agrees and believes that theseregimes provide adequate standards aswell as recordkeeping requirements; theAgency believes that the recordkeepinginformation outlined in the paragraphabove would be maintained in responseto these various recordkeepingrequirements. At a minimum, regardlessof the regime under which a facility isregulated, the recordkeeping andreporting requirements outlined in thissection are necessary in order todetermine compliance with this finalrule.

The Agency requested comments inthe proposal on whether all companiesthat intend to destroy controlledsubstances should submit a one-timereport to the Agency describing theirmethods used to record the volumedestroyed and to determine destructionefficiency ratings. Two comments

received by the Agency supported theone-time reporting of these methods.One commenter stated that the Agencyshould ask for the volume destroyed butnot the method used in making thatdetermination. EPA believes that inorder to judge adequately whether thereported volume destroyed is accurate,it must know the destruction efficiencyand understand the method that is usedto determine volume and degree ofdestruction, Therefore, EPA will requirethe one-time report on the unit'sdestruction efficiency, and the methodsused to record volume destroyed and todetermine destruction efficiency rating.

The Parties to the Protocol inCopenhagen agreed that all Parties wereto submit annual data on ozone-depleting chemicals destroyed. Tocomply with this agreement, the Agencyrequires an annual reportingrequirement that all persons whodestroy Class I and Class HI chemicalsreport to EPA the volume destroyed ifsuch a report had not been submitted tothe Agency by the end of 120 days afterthe effective date of this rule.

Another commenter that producescontrolled substances only as CUBPsstated that the recordkeeping requiredunder the destruction provision is moreburdensome than the recordkeeping forCUBP production. EPA clarifies in thisresponse that the producer ofcoincidentally produced byproductswould fall outside of the allowancerequirements through either theinsignificant quantity exemption of thissection or due to the destruction of thatwhich is produced. EPA believes thatthe recordkeeping and reportingrequirements associated with thedestruction exemption are minimal andnot overly burdensome to a producer ofcoincidentally produced byproducts.Therefore, EPA, with this rule,establishes the reporting andrecordkeeping requirements as proposedfor controlled substances that aredestroyed.

3. Spills. The definition of productionin both the current rule and theproposed regulations accompanying theMarch 18 proposal includes spilled orvented controlled substances equal to orin excess of one hundred pounds perevent.

The Agency received a number ofcomments on this aspect of thedefinition of production. Allowancesare currently required in cases of a spillor venting that exceeds 100 pounds.Commenters requested that EPA deletethis part of the definition of production.Producers of ozone-depleting substanceswho currently hold allowancesindicated that this provision may placecompanies in non-compliance after the

65052 Federal Register I Vol. 58. No. 236 9 Friday. Decenber 10. 1093 / Rules and Ragulatims

phaseout, sbwe allowamces to coverspills would not be available. Once tephaseout is completed, there will be nomeans by which to comply with thisrequirement. Furthermore, commentersindicated that this provision does notallow for unusual -ciroumstances. Forexample, a company that needs toquickly and safely shut down amanufacturing process may need to ventcontrolled substances. Commenterssuggested that the Agency should relyon emission reduction rulespromulgated under other authority byEPA to deal with venting or spillsituations, rather than the "zeroemission" program that would be inplace after the phaseout.

The Agency agrees that requiringallowances for vents and spills over 100pounds would lead to unintentionalnoncompliance following theproduction phaseout, since allowanceswill no longer be available. With thisaction, EPA is deleting spills from thedefinition of production. Therefore,allowances will not be expended incases of spills or venting of any amount.Spills had been included in thedefinition nf production to limit releaseof ozone-depleting chemicals. EPAbelieved that companies could avoidcompliance action by the Agency if theyover-produced and then spilled thisexcess productio. Although suchaction is still possible, the Agency isbeginning to address theseimplementation issues in preparationfor te phaseout. With the phaseout,companies would not be placed Insituations where they would over-produce. Once the phaseout occurs,companies will only produce forexempted uses. However, the Agencyrequires in today's rule that companieskeep recohis of spills in excess of 100pounds. EPA will mwnitor the frequencyof spills through plant inspections andSection 114 information requests whenappropriate.

While the purpose of the definition ofproduction is not to control vents andspills, but to determine the need fora ances for production of controlledsubstances, EPA agrees withcommanters that other existing andproposed EPA regulations governingcontrols of spills and venting aredesigned to provide control of schemissions. The Agency believes that theproposed Hazardous Organic NationalEmission Standard for Hazardous AirPollutants (HON authorized undersection 11 {d) of the Clean Air Act willbe an appropriate mechanism forcontrolling vaMingof several of thesesubstances. Thase xgulations are to bepublished by EPA in early 1994.Furthermore, current regulatims

governing the accidental release ofchemicals are designed to requireappropriate action in the event of spills.

B. ImportsIn this final rule, EPA Is modifying

the requirements of allowances forimports to make them consistent withthe requirements of productionallowances established in this rule.Under the system currently in place,importers expend consumptionallowances to import controlledsubstances intended for transformation,and to import used or recycledcontrolled substances. However, underthe regulations promulgated -withtoday's notice, importers -will not needto expend consumption allowances forcontrolled substances intended fortransformation or destruction, or forozone-depleting substances that areused or recycled. Several commentersrequested this change to ensureconsistency in the treatment ofchemicals that are produced andchemicals that are imported. Inaddition, transformers or destroyers ofimports for which consumptionallowances were expended may redeemconsumption allowances and trade themback to the importer.

C, International Issues

1. Exports

Under current regulations, there is nodistinction made between exports foremissive uses and exports fortransformation. Ccmmenters have notedthat under current regulations, thesesubstances will no longer be able to beproduced, despite an intent to transformor destroy, since there will be noallowances available after the phaseout.These commenters claim that thissituation could severely affect the U.S.global market for feedstock, sinceseveral class I chemicals are feedstocksin production of alternatives. Withoutthis change, cmunmentems claim thatmany producers would be shut out ofthe international markets.

Nevertheless, EPA recognizes thatindustry must ensure that adequatecontrols are in place to verify that theexport is indeed transformed ordestroyed. Tracking and verifying thatexports are transformed or destroyedproves to be much more difficult thanfor imports and domestically producedand sold controlled substances.Consequently, EPA retains its currentprocess for handling exports.Allowances will be required for allexports regardless of whether they arebound for emissive uses ortransformation or destruction. However,EPA recognizes the problems that this

system would impose upon exportersafter the phaseout in 1996. Therefore,the Agency intends to issue asupplemental rule prior to the phaseoutof class I chemicals scheduled for theend of 195 under this rule, in order toaddress issues involving allowances forexports.

2. Transfers of Production RightsBetween Nations

The phaseout regulations currently ineffect provide for the granting ofproduction allowances commensuratewith any production rights transferredby foreign companies to companies inthe United States. However, under theexisting regulations, consumption rightsare not also granted as a part of thesetrades. Under the existing program, EPAonly granted production allowancesbecause consumption allowances wouldbe redeemed after production had beenexported. The Agency had used thismechanism to ensure that theproduction had in fact been exported.This approach was reasonable prior tothe adoption of the phaseout schedule.However, EPA recognizes that as theUnited States approaches the phaseoutdate. consumption allowances willbecome more limited and companiesmay be unable to wait untilconsumption allowances are redeemedfor the export. Commenters haveindicated that these provisions make thetrading of production rights from foreigncountries to companies in the U.S. oflittle if any use, because bothproduction and consumptionallowances are required in order toproduce controlled substances fordomestic consumption.

in response to this concern, theAgency will grant consumptionallowances equal to the level ofproduction allowances $or a trade fromanother Party to the Protoco. Thecompany receiving these allowancesmust certify that this production isintended for export. 'However, when -theUnited States trades production toanother country, EPA will only lowerthe production allowances for theompany involved in the trade. Thecorresponding consuinption allowanceswould be retained in order to be usedto import the production transferredabroad.

D. Insignificant QuantitiesIn today's action, the Agency is

implementing in its regulation a recentdecision of the Parties in Copenhagenthat addressed "insignificant quantities"(Decision M/112). Today's rule exemptsfrom the dfinition of "controlledsubstance" a substance produced in"insignificmt quantities.' The Agency


believes that this change posesinsignificant environmental harm andlessens the administrative burden of thecurrent regulation and thus changes itsdefinition of controlled substance intoday's rule to exempt insignificantquantities.

1. Insignificant Quantities of SubstancesOther Than Methyl Bromide

EPA is also implementing the Parties'decision on insignificant quantities.During the Fourth meeting of the Partiesto the Montreal Protocol held inCopenhagen November 23-25, 1992, theParties approved a decision (DecisionIV/12) stating that the definition of"controlled substance" will not includeinsignificant quantities of thosesubstances under certain conditions.Specifically, it stated that in thefollowing situations, insignificantquantities of controlled substances shallnot be considered to be covered by thedefinition of "controlled substances":

* insignificant quantities originatingfrom inadvertent or coincidentalproduction during a manufacturingprocess; or,

* insignificant quantities originatingfrom use of controlled substances asprocess agents (including unreactedfeedstocks) which are present inchemical substances or products as traceimpurities.

Since these activities are excludedfrom the definition of controlledsubstances, and thus could not becounted against production orconsumption, production andconsumption allowances are notrequired in order to produce or importthese substances.

In either of these situations, theParties recognized that insignificantquantities of controlled substances mayresult or remain in a product afterprocessing. In taking this decision, theParties understood that the existence orcreation of controlled substances inthese contexts were an essentialconsequence of continued production ofvarious products (Section 2.10.4, UNEPreport of the Technology and EconomicAssessment Panel), were likely to beinsignificant in quantity, and in fact,had not heretofore been included in thedefinition of controlled substance, ortaken into account by countries in theirimplementation of the current .definition. Thus, the decision clarifiedthe fact that CFCs and other compoundscovered by the Montreal Protocol ascontrolled substances that are created orfound in these contexts are not includedwithin the scope of the Protocol'sdefinition of controlled substance.Nevertheless, the Decision calls on the

Parties to endeavor to take steps tominimize such emissions.

Pursuant to the decision of the Partiesand comments received supporting thisproposed action, EPA today isexempting from the definition of"controlled substances" insignificantquantities of controlled substances thatoriginate from inadvertent orcoincidental production during amanufacturing process, from unreactedfeedstock, or from their use as processagents and residual presence inchemical substances or products as traceimpurities. This exemption will applyso long as the substances produced inthis manner are not themselves, asdistinct products, offered forcommercial sale.

One commenter asked for clearerlanguage explaining inadvertentproduction. EPA interprets inadvertentproduction to be production that occursunintentionally as a result of a chemicalreaction in the production process.Because the production is inadvertent,the substance itself is neither made for,nor offered for, commercial sale.Inadvertent production occurs in smallquantities, since production ofinadvertent substances constitutesinefficiencies in the production processand manufacturers work to keep suchinadvertent production to a minimum.

EPA carefully considered theenvironmental implications of thisdecision and its relationship to currentregulations. First, as it relates toenvironmental protection, EPA studiedavailable information, and hasdetermined that the quantities ofcontrolled substance emissionsassociated with the above notedsituations are small. Estimates indicatethat they are on the order of 500 ODP-weighted metric tons worldwide. In theU.S., in many cases, these smallemissions are reduced even further byregulatory treatment under other EPArequirements. An example of the size ofrelated production can be found in traceimpurities of carbon tetrachlorideremaining in finished products made inthe U.S. This residual is estimated toamount to 32 metric tons per year,Levels of inadvertent production ofcontrolled substances are also verysmall. For example, some carbontetrachloride is produced during themanufacture of chloroethanes. Theworldwide estimate of levels expectedto be emitted during these processes areestimated to be on the order of 100-200ODP MT. However, carbon tetrachlorideproduced in this manner is generallynot emitted; rather it is recycled withinthe plant, or, as required by RCRA,destroyed by an appropriate technology.A further factor which will help to

reduce related emissions is the phaseoutitself. By the year 2000, emissions fromthese situations are expected toconstitute less then .1% of the amountof controlled substances produced intheir baseline year. The realization ofthe small quantities involved was afactor in the Parties decision to excludethe insignificant quantities resultingfrom these processes from the definitionof controlled substances. (UNEP OzLPro. 4 CRP 2ter).

Regarding present regulatorytreatment, § 82.4(e) of EPA's currentregulations provided an exemption fromcontrol for Group IV or V substances, ifthose substances were produced as acoincidental unavoidable byproduct of amanufacturing process, and wereimmediately contained and destroyed.In light of the regulations EPA ispromulgating today concerningincidental production and destruction,EPA is today repealing the currentrequirements of § 82.4(e), effective withthe 1994 control period. This action isbeing taken to align EPA regulationswith Montreal Protocol requirementsthat will be adhered to internationally,and to eliminate the ambiguity ofcertain situations that may or may nothave met the requirements of § 82.4(e).

With this rule, all companies thatmeet these conditions are exempt fromproduction and consumption controland do not need to file exemptionrequests. Finally, it fashions a moreworkable allowance system that will benecessary as the U.S. moves forwardtoward a more rapid phaseout.

One commenter expressed concern,given the elimination of thecoincidental unavoidable byproductprovision, that no guidance is given forwhat constitutes an insignificantquantity. EPA clarifies in this responsethat the producer of coincidentallyproduced byproducts would either falloutside of the allowance requirementsthrough the insignificant quantityexemption of this section or due to thedestruction of that which is produced.While the Agency believes that aspecific number or percentage thatconstitutes an insignificant quantitycannot be defined in terms of volume orconcentration for all instances, thosecoincidentally produced byproductsthat fall outside of the insignificantquantity realm as determined by thecommenter can be exempted from thedefinition of production as a result ofdestruction of the byproduct.

In taking these actions, EPA ismindful of the portion of the Parties'decision that urges all Parties to takesteps to minimize emissions associatedwith inadvertent and trace quantityproduction. In this regard, EPA reserves

5b$4 Federal Register I Vol. 58, No. 236 1 Friday, December 10, 1993 1 Rules and Regulations

the Tight to implement measures toreduce such emissions in the event itfinds that they are or have becomesignificant.

In conclusion, today's rule, inimplementing the decision of the Partiesto the Protocol on Insignificantquantities, removes from the definitionof "controlled substance" thosesubstances that are:

* insignificant quantities originatingfrom inadvertent or coincidentalproduction during a manufacturingprocess; or

* insignificant Quantities originatingfrom use of controlled substances asprocess agents (inchding unreactedfeedstocks) which are present inchemical substances or products as traceimpurities.

2. Insignificant Production of MethylBromide

Several commnters noted that in thepreamble to the proposed rulemaking,EPA niestated that methyl bromide wasinadvertently produced in theproduction of polyethylene. In factmethyl bromide Is an inadvertentbyproduct of the manufacture ofterephthalic acid {TPAJ and dimethylterapthalate IDMT). feedstocks whichare sed in the production ofpolyethylm terephthalate.

While suppoting EPA's proposal toexempt inadvatent production ofmethyl bromide from the definition ofcontrolled substmaces, one commenterdisagreed with EPA's conclusion that"substantial" emissions of methylbromide are inadvertently producedduring the manufacture of TPA/DMT.This oommenter noted that emissions ofmethyl bromide during the productionof these chemicals ranges from .0001 to.0007 pounds of TPADMT produced,making them non-substantial On theother hand, one commenter noted thatinadvertent methyl bromide emissionsrepofted to the toxic release inventoryshowed that byproduct emissions in1990, which can also come from methylbromide manufacturing, totaled over 1.5million pouds, and therefore, shouldnotbe exempted from control as aninsignificent quantity.

EPA's statement in the proposalregarding the magnitude of emissions ofmethyi bromide are prodnced stemmedfrom ths total quantity of relatedemissions. Data provided from the 3domestic manufacturers of WAn)'MTwhich emit methyl bromide estimated1990 methyl bromide emissionsamounted to 2.5 nillion pounds. EPA,will continue to work with the industryto redace these emissions and tomonitor these emissions to determine if

regulatory action is needed in thefuture.

As noted in the comments ofseveralTPA/DMT producers, the 3 domesticproducers of TPA/DMT have committedto achieve a 20% plus reduction in theiremissions by 1997, and an 85% plusreduction by 2000. Several commentersnoted the cost of requiring industry tomake these reductions using presentlyavailable technology. Given the fact thatthe rules being promulgated today donot require any reductions in methylbromide emissions until the year 2001,and the industry has committed to makeshort term reductions, EPA believes thatit is prudent to Let industry investigatenew and innovative measures whichwill allow it to meet this commitmentat the lowest possible costs. EPA will,however, continue its discussion withthis industry in order to monitor,carefully, progress toward theircommitment. EPA is committed totaking necessary actions to ensure thatrelated emissions are indeedinsignificant.

Several commenters noted that equitydictated that similar commitments toreduce inadvertent production ofmethyl bromide should be madeglobally to ensure that US manufacturesare not put at a competitivedisadvantage for hauing to comply withthese provisions. The EPA will help toensure that this matter is considered bythe Parties to the Prtocol in a mannerwhich preserves the lead time whichwill be usehil In the investigation oftechnological reduction optias.

VII. Other Issues

A. WfiWnovo .ImporterThe March 18 Notice proposed a

revision to the definition of "importer"to include the actual owner, theconsignee, and the transferee of theimport. The Agency proposed thisrevision to ensure that requirementsimposed on importers affected theparties most directly responsible for theimport.

EPA proposed to define "Importer" tomean any person who imports acontrolled substance, or a controlledproduct into the United States."Importer" includes the personprimarily liable for the payment of anyduties on the merchandise or anauthorized agent acting on his or herbehalf. The term could also include, asappropriate:

(1) The consignee;2) The importerof record;

'3) The actual owner; or14) The transferee, if the right to draw

merchandise ln a banded warehouse hasbeen transferred.

Several commenters stated that thisdefinition was unsatisfactory because itcontinued to list "importers ofrecord"as legally responsible for conforming tothe regulations. The commenters wereconcerned that since custom brokersoften act as importers of record, theywould be legally liable transactions. Thecommenters believed that brokers, sincethey act solely for the purpose offacilitating the entry of goods, should beexempted from liability in cases wherethey are acting as an importer of record.Commenters further suggested thatcustoms brokers, even when they are"importers of record," are financiallyuninterested parties in those instanceswhere they are merely acting as nominalimporters.The commenters also suggested that,

as an alternative, the proposedregulations be modified to include ahierarchy of persons to be heldresponsible for imports. 'Thecommenters believed that such anenforcement hierarchy will indicate thatthe customs broker would be heldresponsible for regulatory complianceonly in those situations where there isno owner/purchaser and no consigneeset forth on the entry form and/orlocated in the United States. Thefollowing hierarchy was suggested:

'(1) Owner;(2) Purchaser;(3) Cms -in e(4) Trauiere, anud(5) Customs broker (if acting as the

importer of record).In response EPA however, has

decided ot to clage its definition of"importer" from the one proposed. EPAwill consider adopting a hierarchy, suchas the one suggested by the commenters,as part of its enforcement strategy forthis program. EPA does not agree thatall customs brokers listed as "importersof record" are financially uninterestedparties. As indicated by -the commentsto the proposed rule. customs brokersprovide services which facilitate theentry of merchandise into the UnitedStates. The brokers are a part of thechain of pwsos that participate in animport transactioa, and fees are chargedfor the services that are provided. As aresult, EPA views customs brokers asknowledgeable professionals regardingimport matters. In light of theseconsiderations, EPA has incidedcustoms brokers who act as importers ofrecord in its list of persons responsiblefor import of cxrtrolled substances.

It should also be noted that only,oneparty to an import transaction needs tohold consumption .allwances for theimportation of a crinrolLed substance.This issue was taised by a cnaenterwho is concerned that allowances are


frequently held by the -owners orpurchasers of controlled substances andnot by the importer of record. Underthis regulation, only one of the severalparties included in the definition ofimporter needs to hold and expendconsumption allowances for a particulartransaction. However, the other partiesinvolved in that transaction need to beaware of the import requirementspromulgated under this rule. Therefore,while the "importer of record" need nothold consumption allowances, it is apart of its function to determine that thenecessary allowances are being held andexpended.B. Tracking Essential Uses

Several commenters indicated thatadditional changes may need to be madein the tracking procedures in order toaccommodate any essential useexemptions that are granted under theMontreal Protocol EPA agrees that anygranted essential use exemptions willnecessitate changes in the trackingsystem. Changes such as these will beproposed and finalized in a rulemakingto be initiated at a later date whenprovisions to allow production forspecified essential uses are established.

C. Addition of HCFCs to the EPCRASection 313 List

The March 18 Notice Indicated thatthe Agency published a FederalRegister action on June 24, 1992 (57 FR28159) proposing to add HCFCs to thelist of toxic chemicals subject toreporting under EPCRA section 313. Inthat proposal EPA also solicitedcomments on alternative options forlisting the HCFCs, such as listing thoseHCFCs known to be in production orcommercially viable individually andproviding some mechanism, such as aSignificant New Use Rule, to add HCFCsthat come into production in the future.In this proposal, EPA also identified fiveHCFCs as currently in production orcommercially available. These are:HCFC-141b, HCFC-22, HCFC-142b,HCFC-123, and HCFC-124. Commentsregarding this proposed rule arecurrently being analyzed and theAgency expects to issue a final rule onthis matter in the near future.

D. Environmental Impact StatementOne commenter stated that EPA is

obligated to prepare an environmentalimpact statement (EIS) under theNational Environmental Policy Act of1969 (NEPA), 42 U.S.C. 4321 et seq., forits action to regulate methyl bromide.While EPA has extensively consideredthe environmental impacts of thisaction, section 7(c)(1) of the EnergySupply and Environmental

Coordination Act (ESECA), 15 U.S.C.793(c)(1), exempts EPA from preparingan EIS under NEPA. That provisionstates: "No action taken under the CleanAir Act shall be deemed a major Federalaction significantly affecting the qualityof the human environment within themeaning of the National EnvironmentalPolicy Act of 1069." The Agency furthernotes that its policy statement publishedon May 7, 1974 does not obligate theAgency to prepare an EIS. See 39 FR16186. In that policy statement; EPArecognized, prior to enactment ofsection 7(c)(1) of the ESECA, that "ItiheFederal Courts of Appeals have heldthat the Agency need not prepareenvironmental impact statements for itsenvironmentally protective activities."Id. While EPA announced that it wouldvoluntarily prepare EISs for certainmajor regulatory actions specified in thepolicy statement (not including actionsunder the subsequently enacted title VIof the Clean Air Act), the Agency madeclear that "[tihe voluntary preparationof impact statements in no way legallysubjects the Agency to NEPA'srequirements." Id.

E. Recycled and Used ControlledSubstances

The Agency proposed to excluderecycled and used ozone-depletingsubstances when calculatingconsumption. EPA proposed this changeto conform the U.S.'s treatment of usedand recycled controlled substance witha recent decision (Decision IV/24) inCopenhagen by the Parties to excludesuch chemicals from the calculation ofconsumption.. EPA received supportfrom three commenters on this proposedchange.

Prior to this Protocol decision andthis rulemaking, used and recycledcontrolled substances did count as partof a country's consumption. Within theUnited States, importers were requiredto hold consumption allowances toimport used or recycled controlledsubstances. In turn. an exporter couldreceive additional consumptionallowances for the export of used orrecycled controlled substances.

With this rule, the importation ofused or recycled controlled substanceswill not require consumptionallowances, and therefore will beunrestricted. Similarly, the exporters ofused or recycled controlled substanceswill not receive consumptionallowances for such export.

EPA did not describe specificrecordkeeping requirements in theproposal, but asked for comment on theneed for further revisions "to effectuatethis intent of the Parties." Onecommenter suggested that importers and

exporters make some certification thatthe shipment is "being done properlyand legally". Although the commenterdid not describe specifics on how thiscould be done, the Agency believes thatit would be reasonable to require thatimporters and exporters state on all billsof lading and invoices coveringshipments of used or recycledcontrolled substances that the "shippedproduct is a used or recycled controlledsubstance as defined in 40 CFR 82.3".EPA believes that such documentationrepresents a minimal reporting burdenand should provide adequate control tosafeguard against fraud.

EPA proposed that importers andexporters of recycled halons and HCFCsreport on an annual basis to EPA. EPAproposed to require this data in order toreport these volumes to UNEP asrequired by the Protocol. The Agencyreceived no comments on this provisionand therefore requires such reportswithin 45 days after the end of eachcontrol period.

F. TranshipmentsThe Agency proposed to exclude

transhipments of bulk controlledsubstances from the consumption limitsfor the United States. EPA proposed thisexclusion to implement Decision IV/14of the Parties. Transhipments areshipments of bulk chemicals from oneparty to another through the UnitedStates that are not repackaged withinthe United States. The United Statesserves only as a shipping corridor forthe controlled substances. EPA did notreceive any comments on this issue.With this final rule, the Agencyexcludes transhipments from theconsumption limits. Companies thattranship must keep records that thetranshipment does not .enter interstatecommerce in the United States.

G. Publication of the Regulatory TextSome commenters have suggested

EPA was obligated to publish proposedregulatory text. EPA believes its March18 proposal that explained the basis andpurpose of its intended actions andnotified the public of the availability ofthe regulatory text was legally sufficient.

Section 307(d) of the Clean Air Actapplies to "promulgation or revision ofregulations under title VI (relating tostratosphere and ozone protection)" togovern the rulemaking procedures here.See section 307((d)(1)(I). Thatsubsection specifically provides that:notice of proposed, rulemaking shall bepublished in the Federal Register, asprovided under section 553(b) of title 5,shall be accompanied by a statement ofits basis and purpose and shall specifythe period availale for public I

_65056 Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations

comment. * * * The statement of basisand purpose shall include a summaryof-

(A) The factual data on which theproposed rule is based;

(B) The methodology used inobtaining the data and in analyzing thedata; and

(C) The major legal interpretationsand policy considerations underlyingthe proposed rule.

Section 553(b) of title V (theAdministrative Procedure Act, or APA)provides, in turn, that "general notice ofproposed rule making shall bepublished in the Federal Register.* * * The notice shall include-- * *either the terms or substance ofproposed rule or a description of thesubjects and issued involved."

Clean Air Act section 307(d) nowherementions publication of the terms ofsubstance of a proposed rule.Furthermore, APA section 553(b) clearlyoffers an agency the choice of whetherto include the terms of substance of theproposal or a description of the subjectsand issues involved. EPA's extensivediscussion of the subjects and issuesinvolved in its proposal, published onMarch 18, thus satisfies the publicationrequirements of the Clear Air Act andAPA.

In any case, the published ruleprovided adequate notice to appriseinterested parties of the subject of therulemaking in order to afford them ameaningful opportunity to participateand comment on the issues involved.See, e.g., Florida Power 8 Light Co. v.United States, 846 F.2d 765 (D.C. Cir.1988); South Carolina ex rel. Tindal v.Block, 717 F.2d 874, 885 (4th Cir. 1983);Small Refiners Lead Phase-Down TaskForce v. EPA, 705 f.2D 506, 547 (D.C.Cir. 1983) (cases summarizing purposeof notice to provide opportunity tocomment). There is no question thatEPA's published proposal sufficientlyalerted interested parties of the likelyalternatives being considered within thescope of the proceedings for the finalrule. See Spartan Radiocasting Co. v.FCC. 619 f.2d 314, 321 ((4th Cir. 1980)(proposal must notify persons of likelyalternatives so.that they know whethertheir interests are at stake); see alsoBonney Motor Express, Inc. v. UnitedStates, 640 F.2d 646, 650 (5th Cir.1981)(final rule can be substantiallydifferent from proposal if proposal fairlyapprised interested parties of subjectand issues before the Agency).

EPA did in fact notify the public inthe published proposal that regulatorylanguage could be obtained through theEPA hotline, and provided a telephonenumber for obtaining it. See 58 FR15014 (March 18, 1993). The regulatory

language was available before the publichearing held on April 2, 1993, and thepublic of course also had an opportunityto comment on the proposed regulatorylanguage by the close of the commentperiod on May 19.

IX. Changes From the Proposal andCurrent Program

This section discusses the changesEPA has made in this final rule and howthey differ from the proposed rule andthe current program.

§ 82.1 Purpose and Scope.This section changes slightly from the

current rule to include the newdefinition of donsumption, and the tradeprovisions. There are no changes fromthe proposal.

§82.2 Effective date.January 1, 1994, is the effective date

for this rule, except for §§ 82.4(d) and82.3(h) and (1) which are effectiveJanuary 10, 1994. The effective date forthe listing of methyl bromide as a classI controlled substance is December 10,1993.

§82.3 Definitions.Section 82.3 contains some

modifications to definitions or additionsto definitions. In the final rule, a newsubsection (g) has been inserted,defining "completely destroy", whichmeans to cause the expiration of acontrolled substance at a destructionefficiency of 98 percent or greater, usingone of the destruction technologiesapproved by the Parties.

A new paragraph (h) was inserted in§ 82.3 in the proposed rule and isretained in this final rule, defining"complying with the Protocol" to meanwhen referring to a foreign state notParty to the 1987 Montreal Protocol, theLondon Amendments, or theCopenhagen Amendments, as indicatedin appendix C to this subpart by ameeting of the Parties as noted in therecords of the Directorate of the UnitedNations Secretariat to be in fullcompliance with the provisions of theMontreal Protocol specified in Article 4paragraph 8 of the Montreal Protocol.

A new paragraph (i) was inserted inthe proposed rule and is retained in thisfinal rule, defining "consumption" tomean the production plus importsminus exports of a controlled substance(other than transhipments, or recycledor used controlled substances).

A new paragraph (1) was inserted inthe proposed rule and is retained in thefinal rule, defining "controlled product"as a product that contains a controlledsubstance listed as a class I, Group I orII substance in appendix A of the rule,

and that belongs to one or more of sixcategories of products, which includeautomobile and truck air-conditioningunits, domestic and commercialrefrigeration and air-conditioning/heatpump equipment, aerosol products(except medical aerosols), portable fireextinguishers, insulation boards, panelsand pipe covers, and pro-polymers. Thedefinition also states that controlled 'products include, but are not limited to,those products listed in appendix D tothis subpart.

Current paragraph (i), defining"controlled substance," was modified inthe proposal and in this final rule, withthe modified definition of "controlledsubstance" becoming paragraph (m).Also added to the new definition is asentence explaining that inadvertent orcoincidental creation of insignificantquantities of listed substances, (1)during a chemical process, (2) resultingfrom unreacted feedstock, or (3) fromthe controlled substance's use as aprocess agent present in the chemical asa trace impurity substance beingmanufactured are not deemedcontrolled substances. Furthermore, thedefinition is modified to explain thatclass I substances are now divided intoseven, rather than five groups.

The definition of "CUBP," paragraph(j) in the current rule, is removed fromthis final rule.

A new paragraph (o) was inserted inthe proposed rule and in this final ruleto define "destruction" as the expirationof a controlled substance that does notresult in a commercially useful endproduct and that uses one of the fivedestruction technologies (listed in thedefinition) approved by the Parties tothe Protocol. In the final rule, anadditional clarification is added,inserting "to the destruction efficiencyactually achieved, unless consideredcompletely destroyed under the rule"after the phrase "expiration of acontrolled substance."

A new paragraph (t) was inserted inthe proposed and final rules, defining"foreign state not Party to or Non-Party"as a foreign state that has not depositedinstruments of ratification, acceptance,or other form of approval with theDirectorate of the United NationsSecretariat, evidencing the foreignstate's ratification of the provisions ofthe 1987 Montreal Protocol, the LondonAmendments, or of the CopenhagenAmendments, as specified.

The definition of "import", newparagraph (u), was modified in theproposal to add to the exemptions fromthe definition, "bringing a controlledproduct into the U.S. when transportedin a consignment of personal orhousehold effects or in a similar non-

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations 65057.

commercial situation normallyexempted from U.S. Customs attention."

In the proposal, the current definitionof "importer" was stricken, with arevised definition inserted (newparagraph (v)). The revised definition ofimporter is any person who imports acontrolled substance or a controlledproduct into the United States. Thedefinition elaborates that importerincludes the person primarily liable forthe payment of any duties on themerchandise or an authorized agentacting on his behalf. The term alsoincludes, as appropriate, the consignee;the importer of record; the actual owner,if such a declaration and supersedingbond has been filed; or the transferee, ifthe right to draw merchandise in abonded warehouse has been transferred.

A new paragraph (w) was insertedinto the proposed and final rules,defining "London Amendments" as theMontreal Protocol as amended at theSecond Meeting of the Parties to theMontreal Protocol in London in 1990.

Paragraph (p) of the current rule,defining "MACT," is stricken from thisfinal rule.

A new paragraph (y) was inserted intothe proposed rule and in the final rule,defining "1987 Montreal Protocol" asthe Montreal Protocol, as originallyado ted by the Parties in 1987.

The definition of'Tarty" (paragraph(as)) was expanded in the proposal andretained as such in the final rule. In thenew definition, "any foreign state" issubstituted for "any nation." Added tothe end of the current definition is thefollowing: "(pursuant to instruments ofratification, acceptance, or approvaldeposited with the Depository of theUnited Nations Secretariat), as havingratified the specified control measure ineffect under the Montreal Protocol.Thus, for purposes of the trade bansspecified in § 82.4(d)(2) pursuant to theLondon Amendnents, only thoseforeign states that are listed inAppendix C to this subpart as havingratified both the 1987 Montreal Protocoland the London Amendments shall bedeemed to be Parties."

In the proposal, the definition of"production" (paragraph (ee)) wasmodified to add to exemptions from thedefinition, those amounts that aredestroyed by the approved technologies.The final rule additionally exemptsthose amounts that are spilled or ventedunintentionally, rather than only thoseamounts less than 100 pounds perevent, as in the current rule and in theMarch 18, 1993 proposal.

A new paragraph (hh) was added inthe proposal and final, defining"transhipment" as the continuousshipment of a controlled substance from

a foreign state of origin through theUnited States or its territories to asecond foreign state of final destination.

The definition of "unexpendedconsumption allowances" (paragraph(ii)) was modified in the proposed ruleand in the final rule to excludetranshipments in the part of thecalculation where controlled substancesthat the person has produced orimported are subtracted from the totallevel of that person's consumptionallowances held.

The final rule adds paragraph (kk) todefine used or recycled controlsubstances as controlled substances thathave seen service in their intended usesystems.

All paragraphs are re-letteredaccordingly.

§82A Prohibitions.This section of the current rule has

been replaced with new regulatorylanguage. EPA has modified § 82.4(a) toexempt the production of controlledsubstances that will either betransformed or destroyed from theproduction allowance limit. Thisexemption is expanaed from thatproposed in the March 18 notice toinclude not only Group IV class Icontrolled substances, but all class Icontrolled substances.

Similarly, § 82.4(b) which limitsproduction and importation throughconsumption allowances provides forthe same expanded exemptions as§ 82.4(a).

Section 82.4(c) states the conditionswhen consumption allowances andproduction allowances are used inconjunction to produce controlledsubstances. As with the currentprogram, only consumption allowancesare needed to import. This sectionrestates the exemptions for productionand consumption for controlledsubstances that are transformed oreventually destroyed, or those forexempted uses under § 82.4(k).

Section 82.4(d) has not changed sincethe proposal. EPA has expanded theexisting § 82.4(d) to include not only theprohibition on the export or import ofa Group I and Group II, class Icontrolled substance to and from aforeign state not party to the Protocol (orcomplying with the Protocol), but alsothe prohibition on the export or importof Groups M, IV, and V, class Icontrolled substances to or from foreignstates not party to the LondonAmendments (or complying with theLondon Amendments). Also, theproposal, and today's final rule,includes the prohibition on theimportation of certain productscontaining group I and II, class I

controlled substances, from foreignstates not party to the Montreal Protocol(or complying with the MontrealProtocol).

EPA has dropped existing andproposed § 82.4(e) from this final rule.This subparagraph had described theaccounting procedures that the Agencywould perform to calculate the level oftransformation of Group IV, class Icontrolled substance done in theproceeding control period, that wouldbe attributed to the control period. Asalready noted, EPA found thisaccounting procedure cumbersome, andwill no longer require this calculation.

The proceeding subparagraphs thataddress class II controls are re-alphabetized. Proposed § 82.4{fbecomes (e). The Agency has furthermodified the proposed restrictions onproduction of HCFC-141b to exemptdestruction, transformation, or forexemptions stated in § 82.4(1) (formedical devices or exports to adeveloping countries). The proposalrestricted all production. Similarly,proposed § 82.4(g) becomes (f), andprovides exemptions to the prohibitionfor the import of HCFC-141b effectiveJanuary 1, 2003. These exemptionsinclude import for the purposes oftransformation, destruction, or for theexemptions in § 82.4(1).

Proposed § 82.4(h) becomes (g) withthe re-lettering. The proposal hadlimited production HCFC-22 andHCFC-142b to the level of consumptionand production baseline allowancesallocated under § 82.5(h) (reserved) and§ 82.6(h) reserved. The Agency hasmodified this to allow exemptionsunder § 82.4(1) (medical devices andexports to developing countries). Thefinal rule does not allocate eitherproduction or consumption allowancesat this time, but states that these HCFCsmay only be produced or imported forthe purposes of servicing existingequipment, and for transformation ordestruction.

Proposed § 82.4(j) is now § 82.4(h)and, which now restricts the productionand consumption of HCFC-22 andHCFC-142b starting in the year 2020 toonly uses that transform or destroy thesechemicals, or for exemptions in§ 82.4(1).

Proposed § 82.4(k) becomes § 82.4(i).EPA has modified this section to restrictproduction and consumption of anyother class II controlled substance thathad not been previously controlled tobaseline production and consumptionallowances defined in § 82.5(h) or forfeedstock use or transformation, for usesthat eventually destroy the controlledsubstance, for use as a refrigerant in


equipment manufactured prior to 2020or for exemptions in § 82.4(1).

Proposed § 82.4(1) becomes § 82.4(j)and has been substantially modified.This paragraph prohibits the productionor importation of any class II controlledsubstance in 2030 and beyond exceptfor uses as a feedstock, where it isdestroyed, or for exemptions in § 82.4(1).

Proposed § 82.4(n) becomes (k) and isreserved for exemptions for essentialuses for class I controlled substances.

EPA has added an additionalparagraph (1) that will state exemptionsto the class II bans. As allowed underthe Clean Air Act, excess productionand consumption may be used formedical devices or for export todeveloping countries. These paragraphsare reserved.

§ 82.5 Apportionment of BaselineProduction Allowances.

This section remains as part of thecurrent program but now includesparagraphs for Groups VI and VII, classI controlled substances.

§ 82.6 Apportionment of BaselineConsumption Allowances.

This section remains as part of thecurrent program but now includesparagraphs for Groups VI and VII, classI controlled substances. Theseparagraphs are reserved.

§ 82.7 Grant and phased reduction ofbaseline production and consumptionallowances for class I controlledsubstances.

This section amends the currentprogram to accelerate the phaseout inthe production and consumption ofclass I chemicals. This section has notchanged from the proposal except thatthe phaseout date for methyl bromide Is2001, not 2000 as proposed.

§ 82.8 Grant and freeze of baselineproduction and consumption allowancesfor class II controlled substances.

This section continues to be reserved.The Agency had proposed a reductionschedule for the class II chemicals thatwas tied to an allowance system. In thedevelopment of the final rule, asdescribed elsewhere, EPA controls classII chemicals under § 82.4 of this rulethrough an allowances program.However, EPA will mast likely amendthis rule in the future when the decisionto have an allowance system in place tocontrol class II controlled substances.

§ 82.9 Availability of productionallowances in addition to baselineproduction allowances.

The Agency had not proposedchanges to § 82.9(a). However, duringthe comment period, EPA receivedcomments that the dates cited in this

section had not changed toaccommodate the accelerated phaseoutof class I chemicals. EPA has notaccelerated these dates in this final rulebut intends to propose such changes inthe near future.

TheAgency had not proposed anychanges to § 82.9(b). However, in thisfinal rule, EPA will increaseconsumption allowances for a companyequal to production allowances it wouldreceive in a trade of production fromanother Party to the Protocol, and thatsuch a trade of production allowancesnow requires a signed statement from aperson that the increased production isintended for export to the Party tradingits production.

The Agency had proposed droppingthe provisions of § 82.9(c), and toestablish a system where allowancescould be redeemed for controlledsubstances that were transformed ordestroyed. EPA has further modifiedthis requirement to require personsrequesting additional allowances tocertify that allowances had beenexpended for the production of thecontrolled substancesvtransformed ordestroyed. The Agency also stipulatesrequirements for "completedestruction" of controlled substances.

§82.10 Availability of consumptionallowances In addition to baselineallowances.

For § 82.10(a), The Agency proposedand makes final today the ability forexporters to receive additionalconsumption allowances for exports,except for controlled substances that aretranshipped. However, EPA hasexpanded this exclusion to used orrecycled controlled substances. TheAgency had not included this exclusionin the proposed regulatory text, but haddiscussed this exclusion in thepreamble.

EPA proposed to change § 82.10(b) toallow persons who transformed ordestroyed all class I chemicals,including groups VI and VII, to receiveadditional consumption allowancesupon proof that, indeed, the chemicalshad been destroyed or transformed. EPAhas modified this provision to require acertification that production and/orconsumption allowances wereexpended in the production or import ofthe destroyed or transformed controlledsubstances requirements in § 82.10(b)(1)that include the identity and address ofthe person, the name, level and quantityof the volume transformed or destroyed,invoice documenting sale of thecontrolled substance and the name ofthe resulting chemical of thetransformation, and the efficiency of therelevant destruction process.

Section 82.10(b)(2) remains asproposed, providing for Agency reviewof these transactions. EPA has addedfurther clarification of "completelydestroyed", allowing for 100 percentredemption of allowances for 98 percentdestruction of controlled substances.

Finally, the current § 82.10(c) iseliminated, and replaced by anotherprovision that grants persons increasedconsumption allowances, when suchpersons receive production allowancesfor trades of production from anotherParty to the Protocol. This paragraphcomplements § 82.9(b), and requiresidentical information. The Agencyassumes that compliance with § 82.9(b)is compliance with § 82.10(c).

§ 82.11 Exports to Article 5 Parties.This section remains as proposed.

However, EPA has broadened theexclusion to used or recycled controlledsubstances. The reporting requirementsremain the same as the current program.

§82.12 Transfers.This section remains as proposed.

EPA has deleted the requirement that astatement be included that the trade isfor the purposes of reimbursing aproducer or an importer for allowancesexpended.

§82.13 Recordkeeping and Reporting.Section 82.13(a) changes the effective

date to January 1, 1993, from theJanuary 1, 1992 effective date of thecurrent phaseout rule. Final § 82.13(f)differs from the proposal and onlyapplies to class I substances. Paragraph(f)(2), requiring reporting on by-products not destroyed is deleted,because the destruction provisionscover this aspect in other paragraphs.

The newly-numbered paragraph (f)(2)adds dated records of the quantity ofeach controlled substance produced ateach facility to the records thatproducers must maintain. Currentlysection (f(2) refers only to Group IVreferences and has been eliminated,because all controlled substances arenow being treated in a similar manner.Requirements for maintaining datedrecords of the sale of controlledsubstances for feedstock or destructionand copies of certifications that thesubstance will be transformed ordestroyed are added.

Producers' reporting requirementscurrently in § 82.13(f)(4) are now foundin § 82.13(0(3). They now requireproduction information for each quarterby company, rather than by plant, as inthe current rule and the March 18, 1993proposal. New subparagraph (3)(i) nowonly requires that production bereported, specifying the quantity of any


controlled substance used for feedstockpurposes; the phrase "for controlled andnoncontrolled substances for each plantand totaled by class I controlledsubstance for all plants owned by theproducer" has been deleted from thatsentence in current subparagraph (4)(i).New subparagraph (3)(ii) adds "for usein processes resulting in destruction" tothe requirement in current (4)(ii) thatrequires that the amount of productionfor feedstock use be reported. Thephrase "for each plant, totaled bycontrolled substance for all plants forthat quarter and for the control periodto date" is deleted from currentsubparagraph (4)(iii), and currentsubparagraph (4)(iv) is deleted. Currentsubparagraph (4)(v) becomes (3)(iv).References to "at each plant" areremoved. Additionally, "or eventualdestruction" is added to current (4)(vii),now the new (3)(vi). Current (4)(viii),now (3)(vii), adds the requirement thata purchaser's destruction verification, inthe case of destruction, be submitted,showing that the controlled substance isto be destroyed.

Paragraph (5) now becomes paragraph(4).

Recordkeeping for importers,paragraph (g), is changed as follows:

Subparagraph (g)(1)(i) refers only toclass I controlled substances. A new(g)(1)(ii) is added requiring that recordsbe maintained on the quantity ofcontrolled substances imported fortransformation or destruction, and thequantity sold for each use. Currentsubparagraphs (ii), (iii), and (iv) nowbecome (iii), (iv), and (v). Currentsubparagraph (v), which asks for port ofexit, is deleted. Destruction was addedin the proposal to the required datedrecords documenting sale of controlledsubstances for feedstock use; theaddition is retained in the final rule.Added to the records to be maintainedunder (g)(1) are IRS certifications ordestruction verifications that thecontrolled substances are to betransformed or destroyed, respectively.

Paragraph (g)(2) refers now to "classI controlled substance" and addsdestruction to those reportingrequirements that address substancesimported or sold for feedstock andcertifications that transformation is tooccur. A new subparagraph (x) is added,requiring that the quantity of recyclableand recycled controlled substancesimported during the quarter be reported.

Paragraph (h) refers to how the classI controlled substances modification isretained in this final rule to changereferences to class I substances tocontrolled substances.

Paragraph i) was modified in theproposal and such modification is

retained in this final rule to includedestruction information to therecordkeeping requirements in thisparagraph wherever transformation isaddressed, in a manner parallel totransformation (i.e., "transform ordestroy"), except where requirementsonly apply to transformation; suchrequirements then specify as such in thefinal rule. Any references to "Group IV"are stricken, so that the requirementsapply to all controlled substances, asspecified in this paragraph. A newrecordkeeping requirement has beenadded to paragraph (i): copy of therelevant certifications of intent totransform or destroy, where substanceswere sold for transformation ordestruction purposes.

Paragraph (j),-having been retained inthe proposal, is stricken in the finalrule.

Paragraph (k) was stricken in theproposal and remains stricken in thisfinal rule.

A new paragraph (j) is added in thefinal rule that requires those whodestroy controlled substances to provideEPA with a one-time report stating thedestruction unit's destruction efficiencyand the methods used to record thevolume destroyed and those used todetermine destruction efficiency.

A new paragraph (k) is inserted intothe final rule that requires those whopurchase and subsequently destroy classI controlled substances to provide theproducer from whom they purchase thesubstances with a one-time (unlesscircumstances change) verification thatthe controlled substances they purchasewill be destroyed. Any changes relatedto the verification will require a revisedverification.

A new paragraph (1) is added in thefinal rule that requires persons whopurchase controlled substancesintended for transformation to providethe producer or importer with the IRScertification that the controlledsubstances are to be used in a processresulting in transformation.

A new paragraph (m) is added to thefinal rule requiring persons whotransform or destroy controlledsubstances to report annually to EPA thevolume of those substances transformedor destroyed.

A new paragraph (n) requires everyperson who produces, imports orexports class 11 chemicals must reportits quarterly level of production,imports and exports of these chemicalswithin 45 days of the end of eachquarter.

Paragraph (o) contains newrequirements that those who import orexport used or recycled controlledsubstances label their bill of lading or

invoice indicating that the controlledsubstance is used or recycled.

A new paragraph (p) requirescompanies that import or export used orrecycled Group 11, class I controlledsubstances, or used or recycled class IIcontrolled substances must reportannually.

Finally paragraph (q) requires recordsfor transhipments.

X. Impact of Final ActionThe Agency developed a cost-benefit

analysis of various possible phaseoutschedules presented in the petitions andin the comments as well as the schedulefor the accelerated phaseout of ozone-depleting compounds finalized by EPAtoday. In all the scenarios analyzing thevarious reduction schedules, theanalysis yielded net incrementalbenefits of the same order of magnitudefor all the options with the Allianceschedule yielding the least netincremental benefits over the current2000 year phaseout, and the NRDC andEPA's proposed schedule yielding themost net incremental benefits,depending on the valuation of benefits.Given the uncertainties implicit in anycost benefit analysis of this kind, the netincremental benefits of these scenariosare approximately equal with the lowerbound estimate of $175 billion to ahigher bound estimate of $790 billion(at a 2 percent discount rate).. The analysis includes costassumptions for HCFC replacements.However,.these costs are onlyhypothetical, assuming that HCFCreplacements are between 10% and 30%more expensive than the HCFCthemselves. EPA needed to make suchassumptions since HCFC replacementshave not been yet been identified forsome important uses. When highreplacements costs are used, the netincremental benefits range from $164billion to $776 billion (at a 2 percentdiscount rate). -

As such analysis indicates thatvarious schedules yield comparable netbenefits, the Agency chose as theschedule that it is finalizing today, withlimited modifications, the scheduleadopted in Copenhagen over both theNRDC schedule and the Allianceschedule based on EPA's judgement onthe availability of technologies andinfrastructure support. Although thecost-benefit analysis suggests that theNRDC schedule is a possible option, theanalysis performed on that scenarioassumes the widespread use of varioustechnologies that are dependent on asupporting industry infrastructure thatmay not be present. It is the Agency'sjudgement that although suchtechnologies are available, the

65060 Federal Register / Vol. 58, No. 236 I Friday, December 10, 1993 / Rules and Regulations

deployment of these technologies mayincur significant but unaccounted forcosts, as industry would need to adoptcontrols quickly without full knowledgeof possible cost implications of theiractions, and full support of aninfrastructure necessary to support thattechnology.

For example, the RIA analysisindicates that retrofit of air-conditioningand refrigeration equipment must occurunder all schedules. However, theNRDC schedule requires extensiveretrofitting with total costs approaching$9 billion (at a 2 percent discount rate).The retrofit cost under EPA's proposedschedule would be substantially lower.

Furthermore, all of the phaseoutschedules considered would requiresignificant recycling and recovery atdisposal. Although this will occur, theinfrastructure necessary to providerecycling services, as well as to establishthe bank of halons and CFCs, is underdevelopment, and would be severelystrained under any acceleratedphaseout. However, the Agency believesthat its proposed schedule providessufficient lead time for thisinfrastructure to develop.

The Agency is also finalizing a lessstringent schedule for the phaseout ofHCFCs rather than the schedulessuggested in comments byenvironmental groups for thesechemicals. Although the cost-benefitanalysis indicates that the NRDCschedule may yield higher net benefits,assuming different valuation of benefits,the RIA does not calculate the possibleadverse effects of the rapid phaseout ofHCFCs required under such a schedule.The Agency believes that too short aperiod for the allowable use of HCFCswould further encourage the continueduse of CFCs in the short-term by makingthe use of HCFCs as an alternativeunattractive. It could also force theindustry to move to untestedalternatives that may pose unknownadverse environmental and healtheffects. For this reason the Agency isfinalizing today a less stringentphaseout of HCFCs. The cost of theAlliance petition and EPA's schedulefor HCFCs are comparable.

EPA has also used a discount rate of4.5% as well as 7% in valuing futurecosts and benefits. When such adiscount rate is used, the incrementalcost of the accelerated phaseout (overthe Clean Air Act phaseout) is $21billion, with benefits ranging from $31billion to $124 billion. At a 7% discount'rate, the incremental costs are $12billion, with benefits ranging from $8billion to $24 billion.

EPA also examined the cost andbenefits for a 2001 phaseout date for

methyl bromide. The Agency has statedthat a number of possible alternativesexist for users of methyl bromide, butthat time is required forcommercialization and use. EPA's costanalysis of these alternatives examinedtheir likely range of costs, and coupledthose assumptions with a monte carloanalysis, presenting a set of costs,(median, mean, minimum andmaximum costs) that could be expectedwith the methyl bromide phaseout. Thisanalysis indicates that the minimumsocial cost is approximately $7 millionwhile the maximum cost is roughly $16billion. The mean cost is a little morethan $2 billion while the medium costwas estimated to be $1.7 billion. Theseare the total social costs between 1994and 2010. These costs were discountedat 2%.

EPA calculated the benefits of phasingout of methyl bromide by 2001 betweenthe years 1994 and 2011. EPA estimatesber3fits for this period to range from$14 billion to 56 billion, at a 2 percentdiscount rate. The Agency estimatedthat costs at a 4.5% discoint rate wouldbe $1.2 billion with benefits rangingfrom $4 billion to $16 billion. At a 7%discount rate, the costs would be $.8billion with benefits ranging from $1.6to $6.4 billion.

XI. Additional Information

A. Executive Order 12866Under Executive Order 12866 (58 FR

51735 (October 4, 1993)), the Agencymust determine whether the regulatoryaction is "significant" and thereforesubject to 0MB review and therequirements of the Executive Order.The Order defines "significantregulatory action" as one that is likelyto result in a rule that may:

(1) Have an annual effect on theeconomy of $100 million or more oradversely affect in a material way theeconomy, a sector of the economy,productivity, competition, jobs, theenvironment, public health or safety, orState, local or tribal governments orcommunities;

(2) Create a serious inconsistency orotherwise interfere with an action takenor planned by another agency;

(3) Materially alter the budgetaryimpact of entitlements, grants, user fees,loan programs or the rights andobligations of recipients thereof; or

(4) Raise novel legal or policy issuesarising out of legal mandates, thePresident's priorities, or the principlesset forth in the Executive Order.

Pursuant to the terms of the ExecutiveOrder 12866, it has been determinedthat this rule is a "significant regulatoryaction" because the final rule has an

annual effect on the economy of $100million or more. As such this action wassubmitted to OMB for review. Changesmade in response to OMB suggestions orrecommendations will be documentedin the public record.

B. Regulatory Flexibility ActIn the proposed rulemaking, the EPA

certified, pursuant to section 605(b) ofthe Regulatory Flexibility Act (5 U.S.C.605(b)), that the proposal would nothave "a significant impact on asubstantial number of small entities."During the public comment period, theAgency received commefits suggestingthat this regulatory flexibility"certification" was not appropriatebecause the proposal failed to include aregulatory flexibility analysis on theimpact of methyl bromide phaseout onsmall businesses (especially smallfarmers).

However, a regulatory flexibilityanalysis is required only for smallentities which are directly regulated byrulemaking. See Md-Tex ElectrcCooperative, Inc. v. FERC, 773 F.2d 327(D.C. Cir. 1985) (agency's certificationneed only consider the rule's impact onregulated entities and not indirectimpact on small entities not regulated).The current rulemaking directlyregulates only producers and importersof ozone depleting chemicals, bylimiting the production and importationof such chemicals, including methylbromide. As indicated in the proposedrulemaking, the Agency did analyzewhich producers and importers wouldbe directly regulated by the rulemaking:no small entities would be directlysubject to the rulemaking. There areonly three producers and one importerof methyl bromide, and only oneproducer and importer of HBFCs. Sincenone of these entities qualify as smallbusinesses within the meaning of theRegulatory Flexibility Act, noRegulatory Flexibility Act analysis isneeded for either the proposed or finalrule. Accordingly pursuant to section605(b) of the Act, 5 U.S.C. 605(b), thisrulemaking will not have a significanteconomic impact on a substantialnumber of small entities. EPA herebymakes this certification for this finalrule.

Nonetheless, the Agency, in fact, didgive consideration to the impact of thephaseouts on users, both large andsmall, even though they will not bedirectly regulated by the rulemaking.This is out of concern for user sectors,which will need to find replacementsfor controlled substances. For CFCs,EPA has prepared an analysis toexamine specifically the effect on thephaseout of existing small businesses.

Federal Register / Vol. 58, No. 236 / Friday, December, 10, 1993 / Rules and Regulations 65061'

(The Agency is not at this time able toquantify the impact of the long-termphaseout of class II chemicals.) Forthese chemicals, EPA examined theimpact of the phaseout on the usercommunities which may face increasedcosts during the phaseout of these.chemicals. (All companies regulatedunder 40 CFR part 82, subpart A thatproduce or import are either not smallbusinesses as defined by the SmallBusiness Administration, or will simplyproduce or import the Class Ialternatives, not incurring anyadditional cost to their business.) In itsanalysis of these impacts, EPA believedthat the most affected sectors,household refrigeration, mobileairconditioners, chillers and processrefrigeration, would need to retire orretrofit existing equipment but thatconsumers, rather than business, wouldbear the final costs. In some cases, suchas industrial process refrigeration orchillers, retrofits will be such a smallcost relative to operation costs that theimpact will be minimal. For the othersectors, sterilization, solvent cleaning,portable fire extinguisher, and foamblowing, the alternative technologies arenow readily available, and businessclosures are not expected in thesesectors.

With regard to methyl bromide, theAgency's proposed rulemaking did notdiscuss the specific impacts on smallbusinesses per se. However, theproposal did extensively consider thequestion of the impact of phaseout onusers with regard to availability ofalternatives. As a result for methylbromide, EPA believes it has adopted anapproach that mitigates the impact onusers, including small businesses, to thegreatest extent permissible, consistentwith our legislative mandates.

As noted on page 15034 of theproposal, and in today's document, anewly listed class I substance isautomatically subject to the section604(a) phaseout schedule unless: (1)The Administrator accelerates thatschedule pursuant to section 606; or (2)the Administrator determines that the604(a) schedule is unattainable andextends the schedule pursuant tosection 602(d).

Under section 602(d), in the case ofany substance added to the list of classI or II, the Administrator may extendany schedule or compliance deadlinecontained in section 604 or section 605to a later date than specified in suchsections if such schedule isunattainable, considering when suchsubstance is added to the list. However,an extension under section 602(d) maynot extend the termination ofproduction date for a class I substance

to a date more than 7 years after January1 of the year after the year that it islisted as a class I substance. Withtoday's notice, the United States willphase out production and consumptionof methyl bromide by January 1, 2001,a full seven years after the January 1,following listing. As noted in theproposal as well in today's document,EPA believes this is the most flexibleregulatory program allowable under theClean Air Act. Moreover, by notrequiring interim reductions prior to thephaseout, EPA is further minimizing theimpact of this rule on methyl bromideusers.

This final rule also notes that thelabeling requirements of section 611 ofthe Clean Air Act Amendments do notpertain to the crops and produce thathad been fumigated with methylbromide. Although products that aremanufactured with a class I substanceare required to be labeled, the Agencyhas interpreted the phrase"manufactured with" as "themechanical or chemical transformationof materials or substances into newproducts or to assemble componentproducts". EPA believes thatagricultural processes are excluded fromthis definition of "manufactured", andthat crops and produce do not need tobe labeled under section 611 of theClean Air Act. This interpretation of thelabeling requirement alleviates furtherregulatory burden on users of methylbromide.

Finally, the Agency states that it willcontinue to monitor the development ofsubstitutes over the next seven years,and that some solution to provideessential use exemptions may beexplored if there are no substitutes, inorder to prevent undue impacts onsmall businesses.

Given the time frame and restrictionscontained in the regulation of methylbromide, an assessment of its impact onsmall businesses must look closely atboth near-term and long-term impacts.For the next seven years, productionwill be frozen at 1991 levels. Because ofon-going efforts to reduce occupationaland ambient levels of methyl bromide,its use in many soil fumigation andstructural applications has recently beendecreasing. As a result, maintaining the1991 production levels through 2001should not have any economic impacton current users of methyl bromide.

Seven years from now, after theproduction phaseout in 2001, theimpact on users will largely be drivenby the costs and availability ofalternatives. It is extremely difficult toquantify the long-term impact of thephaseout given the existence of a widerange of potential alternatives either

currently available or potentiallyavailable by the year 2001. While thedocument prepared by the United StatesDepartment of Agriculture (USDA)entitled, "The Biologic and EconomicAssessment of Methyl Bromide,"attempts to calculate the costs of amethyl bromide phaseout, as discussedearlier, this analysis focused on animmediate ban and not a phaseout in2001. Given the number of potentialalternative chemicals and non-chemicals already under review, thepotential exists for additionalalternatives to be available in 2001.

Some alternatives available and usedafter 2001 may indeed prove to be moreexpensive than' methyl bromide whichmay result in lower profits to users ifthese costs cannot be passed on toconsumers. However, EPA has foundthat the impacts from regulatory actionswhich remove pesticides from themarket aremitigated over time as newpest control technologies are introducedand adjustments are made tocompensate for the loss of the pesticidethrough alternative pest controlpractices. It is reasonable to expect thatresearch efforts already underway toimprove the performance andacceptability of metam sodium,dazomet, 1,3-dichloropropene and otherchemical and non-chemical alternativepest control techniques will result inminimizing the impact of a methylbromide phaseout to small entities.When used in combination, and inconjunction with a good integrated pestmanagement program, these materialsshould be able to replace many if not allof the major uses of methyl bromide.Research is currently underway on boththe governmental and academic levels,as well as in the private sector, to ensurethat alternative materials and methodswill be viable and available beforemethyl bromide is phased out.

EPA has also considered theeconomic impact that the removal ofmethyl bromide may have on theAmerican agricultural community. Toestimate the total social cost of thephaseout, forecasting must include theincremental cost and likely prevalenceof the various methyl bromidealternatives in each end use. The resultof such an analysis, including the futurecosts of likely alternatives, applicationsrates, market share, and efficacy of eachalternative, can be extremely variabledue to marked differences in thecharacteristics of various crops, soiltypes, and climatic conditions invarious parts of the country. To reflectthe uncertainty associated with anumber of these key factors, EPA'sanalysis was performed using a "montecarlo" technique. This analysis resulted


in an estimated total social cost of thephaseout of this chemical (between1994 and 2010) varies between a low of$24 million, and a high of $12.2 billion,with a median total cumulative costthrough 2010.of $1.3 billion. EPAbelieves that all scenarios except the"high cost" case represent acceptableimpacts. Moreover, the high costs caserepresents a scenario in which a strongcase could be made for pursuing anessential use provision for thoseapplications where economically viablealternatives do not exist.

As the agricultural researchcommunity and the private sectorexplore viable alternative chemicals andgrowing methods that can substitute formethyl bromide, it is likely that themajority of current use areas will findeconomically viable andenvironmentally sound substitutes priorto the 2001 phaseout. EPA, along withUSDA, intend to continue to workclosely with the agricultural communityto support the expedited developmentand review of these alternatives.Furthermore, the Agency intends toassess throughout the period leading upto the phaseout the extent to whichsubstitutes may not become available forimportant uses of methyl bromide andto take timely steps to ensure that, ifnecessary, to pursue an appropriatemeasures to allow for essential uses.

C. Paperwork Reduction Act

The information collectionrequirements in this rule have beenapproved by the Office of Managementand Budget (OMB) under the PaperworkReduction Act, 44 U.S.C. 3501 et seq.and have been assigned control number2060-170.

This collection of information has anestimated reporting burden estimated tovary from 2 to 15 hours per responsewith an average of 9 hours per responseand an estimated annual recordkeepingburden averaging 250 hours perrespondent. These estimates includetime for reviewing instruction,searching existing data sources,gathering and maintaining the dataneeded, and completing and reviewingthe collection of information.

Send comments regarding the burdenestimate or any other aspect of this-collection of information, includingsuggestions for reduction of this burdento Chief, Information Policy Branch;EPA; 401 M Street, SW. (Mail Code2136); Washington, DC 20460; and tothe Office of Information and RegulatoryAffairs, Office of Management andBudget, Washington, DC 20503, marked"Attention: Desk Officer for EPA".

References

Cicerone, R.J., L.E. Heidt, and W.H.Pollack, "Measurements of AtmosphericBromine" J. Geophys. Res. 94, 16639, 1989.

Gleason, I., et. al., "Record Low GlobalOzone on 1992" Science, April 23, 1993.

Khalil, M.A.K., R.A. Rasmussen, and R.Gunawardena, "Atmospheric MethylBromide: Trends and Global Mass Balance".J. Geophys. Res. 98, 2887, 1993.

Singh, H.B. and M. Kanakidou, "AnInvestigation of the Atmospheric Sources andSinks of Methyl Bromide" Geophy Res lett,20, 133-136, 1993.

Solomon, S. and D.L. Albritton, "Time-dependent ozone depletion potentials forshort- and long-term forecasts" Nature 357,33, 1992.

United Nations Environment Programme,"Environmental Effects of Ozone Depletion"Nairobi, Kenya, 1991..United Nations Environment Programme,"Environmental Effects Panel Report",Nairobi, Kenya, 1989.

United Nations Environment Programme,"Methyl Bromide: Its Atmospheric Science,Technology, and Economics-MontrealProtocol Assessment Supplement', 1992.

United States Environmental ProtectionAgency, "Alternatives to Methyl Bromide"prepared for the Office of Policy, Planningand Evaluation, Washington, D.C., 1993.

WMO, UNEP, NASA, NOAA, U.N. DEP,"Scientific Assessment of Ozone Depletion:1989.

WMO, UNEP, NASA, NOAA, U.K DEP,"Scientific Assessment of Ozone Depletion;1991."

Lists of Subjects in 40 CFR Part 82

Environmental protection,Administrative practice and procedure,Air pollution control, Chemicals,Chlorofluorocarbons, Exports, Imports,Ozone Layer, Reporting andrecordkeeping requirements,Stratospheric ozone.

Dated: November 30, 1993.Carol M. Browner,Administrator.

Part 82, title 40, chapter I of the Codeof Federal Regulations is amended asfollows:

PART 82-PROTECTION OFSTRATOSPHERIC OZONE


Authority: 42 U.S.C. 7414, 7671-7671q.

2. Part 82 is amended by revisingsubpart A to read as follows:

Subpart A-Production and ConsumptionControls

Sec.82.1 Purpose and scope.82.2 Effective date.82.3 Definitions.82.4 Prohibitions.82.5 Apportionment of baseline production

allowances.

Sec.82.6 Apportionment of baseline

consumption allowances.82.7 Grant and phased reduction of baseline

production and consumption allowancesfor class I controlled substances.

82.8 Grant and phased reduction of baselineproduction and consumption allowancesfor class II controlled substances.[Reserved]

82.9 Availability of production allowancesin addition to baseline productionallowances.

82.10 Availability of consumptionallowances in addition to baselineconsumption allowances.

82.11 Exports to Article 5 Parties.82.12 Transfers.82.13 Recordkeeping and reporting

requirements.

Appendix A to Subpart A--Class IControlled Substances

Appendix B to Subpart A-Class IIControlled Substances

Appendix C to Subpart A-Parties to theMontreal Protocol

Appendix D to Subpart A-HarmonizedTariff Schedule Description of Products ThatMay Contain Controlled Substances inAppendix A, Class I, Groups I and H

Appendix E to Subpart A-Article 5 Parties

Appendix F to Subpart A-Listing of OzoneDepleting Chemicals

Subpart A-Production andConsumption Controls

§82.1 Purpose and scope.(a) The purpose of the regulations in

this subpart is to implement theMontreal Protocol on Substances thatDeplete the Ozone Layer and sections602, 603, 604, 605,607 and 616 of theClean Air Act Amendments of 1990,Public Law 101-549. The Protocol andsection 604 impose limits on theproduction and consumption (definedas production plus imports minusexports, excluding transhipments and-used or recycled controlled substances)of certain ozone depleting substances,according to specified schedules. TheProtocol also requires each nation thatbecomes a Party to the agreement toimpose certain restrictions on trade inozone depleting substances with non-Parties.

(b) This subpart applies to any personthat produces, transforms, destroys,imports or exports a controlledsubstance or imports a controlledproduct.

§82.2 Effective date.(a) The regulations under this subpart

take effect January 1, 1994, except for§ 82.3 (N) and (1) and § 82.4(d) that areeffective January 10, 1994. The listing ofmethyl bromide and HBFCs as a class I


controlled substances is effectiveDecember 10, 1993.

(b) The regulations under this partthat were effective prior to January 1,1994 continue to apply for purposes ofenforcing the provisions that wereapplicable prior to January 1, 1994.

§82.3 Definitions.As used in this subpart, the term:(a) Administrator means the

Administrator of the EnvironmentalProtection Agency or his authorizedrepresentative.

(b) Baseline consumption allowancesmeans the consumption allowancesapportioned under § 82.6.

(c) Baseline production allowancesmeans the production allowancesapportioned under § 82.5.

(d) Calculated level means theweighted amount of a controlledsubstance determined by multiplyingthe amount (in kilograms), of thecontrolled substance by that substance'sozone depletion weight listed inappendix A or appendix B of thissubpart.

(e) Class I refers to the controlledsubstances listed in appendix A of thissub art.(f]Class I refers to the controlled

substances listed in appendix B of thissubpart.(g) Completely destroy means to cause

the expiration of a controlled substanceat a destruction efficiency of 98 percentor greater, using one of the destructiontechnologies approved by the Parties.

(h) Complying with the Protocol,when referring to a foreign state notParty to the 1987 Montreal Protocol, theLondon Amendments, or theCopenhagen Amendments, means that,the non-Party has been determined ascomplying with the Protocol, asindicated in appendix C of this subpart,by a meeting of the Parties as noted inthe records of the directorate of theUnited Nations Secretarial

(i) Consumption means theproduction plus imports minus exportsof a controlled substance (other thantranshipments, or recycled or usedcontrolled substances).

(j) Consumption allowances meansthe privileges granted by this subpart toproduce and import class I controlledsubstances; however, consumptionallowances may be used to produceclass I controlled substances only inconjunction with productionallowances. A person's consumptionallowances are the total of theallowances he obtains under §§ 82.7,82.6 and 82.10, as may be modifiedtinder § 82.12 (transfer of allowances).

(k) Control period means the periodfrom January 1, 1992 through December

31, 1992, and each twelve-month period'from January I through December 31,thereafter.

(1) (1) Controlled product means aproduct that contains a controlledsubstance listed as a Class I, Group I orII substance in appendix A of thissubpart, and that belongs to one or moreof the following six categories ofproducts:

(i) Automobile and truck airconditioning units (whetherincorporated in vehicles or not);

(ii) Domestic and commercialrefrigeration and air conditioning/heatpump equipment (whether containingcontrolled substances as a refrigerantand/or in insulating material of theproduct), e.g. Refrigerators, Freezers,Dehumidifiers, Water coolers, Icemachines, Air conditioning and heatpump units;

(ifii Aerosol products, except medicalaerosols;

(iv) Portable fire extinguishers;(v) Insulation boards, panels and pipe

covers; and(vi) Pro-polymers.(2) Controlled products include, but

are not limited to, those products listedin appendix D of this subpart.

(ml Controlled substance means anysubstance listed in appendix A orappendix B of this subpart, whetherexisting alone or in a mixture, butexcluding any such substance ormixture that is in a manufacturedproduct other than- container used forthe transportation or storage of thesubstance or mixture. Thus, any amount.of a listed substance in appendix A orappendix B of this subpart which is notpart of a use system containing thesubstance is a controlled substance. If alisted substance or mixture must first betransferred from a bulk container toanother container, vessel, or piece ofequipment in order to realize itsintended use, the listed substance ormixture is a "controlled substance". Theinadvertent or coincidental creation ofinsignificant quantities of a listedsubstance in appendix A or appendix Bof this subpart: (1) During a chemicalmanufacturing process, (2) resultingfrom unreacted feedstock, or (3) fromthe listed substance's use as a processagent present as a trace quantity in thechemical substance being manufactured,is not deemed a controlled substance.Controlled substances are divided intotwo classes, Class I in appendix A ofthis subpart, and Class II listed inappendix B of this subpart. Class Isubstances are further divided intoseven groups, Group I, Group II, GroupIII. Group IV, Group V, Group VI, andGroup VII as set forth in appendix A ofthis subpart.

(n) Copenhagen Amendments meansthe Montreal Protocol on Substances,That Deplete the Ozone Layer, asamended at the Fourth Meeting of theParties to the Montreal Protocol inCopenhagen in 1992.

(o) Destruction means the expirationof a controlled substance to thedestruction efficiency actually achieved,unless considered completely destroyedas defined in this section. Suchdestruction does not rsulit in acommercially useful end product anduses one of the following controlledprocesses approved by the Parties to theProtocol:

(1) Liquid injection incineration;(2) Reactor cracking;(3) Gaseous/fume oxidation;(4) Rotary kiln incineration; or(5) Cement kiln.(p) Export means the transport of

virgin, used, or recycled controlledsubstances from inside the United Statesor its territories to persons outside theUnited States or its territories, excludingUnited States military bases and shipsfor on-board use.

(q) Exporter means the person whocontracts to sell controlled substancesfor export or transfers controlledsubstances to his affiliate in anothercountry.

(r) Facility means any processequipment (e.g., reactor, distillationcolumn) used to convert raw materialsor feedstock chemicals into controlledsubstances or consume controlledsubstances in the production of otherchemicals.

(s) Foreign state means an entitywhich is recognized as a sovereignnation or country other than the UnitedStates of America.

(t) Foreign state not Party to or Non-Party means a foreign state that has notdeposited instruments of ratification,acceptance, or other form of approvalwith the Directorate of the UnitedNations Secretariat, evidencing theforeign state's ratification of theprovisions of the 1987 MontrealProtocol the London Amendments, or ofthe Copenhagen Amendments, asspecified.

(u) Import means to land on, bringinto, or introduce into. or attempt toland on, bring into, or introduce intoany place subject to the jurisdiction ofthe United States whether or not suchlanding, bringing, or introductionconstitutes an importation within themeaning of the customs laws of theUnited States. with the followingexemptions:

(1) Off-loading used or excesscontrolled substances or controlledproducts from a ship during servicing;


(2) Bringing controlled substancesinto the U.S. from Mexico where thecontrolled substance had been admittedinto Mexico in bond and was of U.S.origin; and

(3) Bringing a controlled product intothe U.S. when transported in aconsignment of personal or householdeffects or in a similar non-commercialsituation normally exempted from U.S.Customs attention.

(v) Importer means any person whoimports a controlled substance or acontrolled product into the UnitedStates. "Importer" includes the personprimarily liable for the payment of anyduties on the merchandise or anauthorized agent acting on his or herbehalf. The term also includes, asappropriate:

(1) The consignee;(2) The importer of record;(3) The actual owner; or(4) The transferee, if the right to draw

merchandise in a bonded warehouse hasbeen transferred.

(w) London Amendments means theMontreal Protocol, as amended at theSecond Meeting of the Parties to theMontreal Protocol in London in 1990.

(x) Montreal Protocol means theMontreal Protocol on Substances thatDeplete the Ozone Layer, a protocol tothe Vienna Convention for theProtection of the Ozone Layer, includingadjustments adopted by the Partiesthereto and amendments that haveentered into force.

(y) 1987 Montreal Protocol means theMontreal Protocol, as originally adoptedby the Parties in 1987.

(z) Nations complying with, but notjoining, the Protocol means any nationlisted in appendix C , Annex 2, of thissubpart.

(aa) Party means any foreign state thatis listed in appendix C of this subpart(pursuant to instruments of ratification,acceptance, or approval deposited withthe Depositary of the United NationsSecretariat), as having ratified thespecified control measure in effectunder the Montreal Protocol. Thus, forpurposes of the trade bans specified in§ 82.4(d)(2) pursuant to the LondonAmendments, only those foreign statesthat are listed in appendix C of thissubpart as having ratified both the 1987Montreal Protocol and the LondonAmendments shall be deemed to beParties.

(bb) Person means any individual orlegal entity, including an individual,corporation, partnership, association,state, municipality, political subdivisionof a state, Indian tribe; any agency,department, or instrumentality of theUnited States; and any officer, agent, oremployee thereof.

(cc) Plant means one or more facilitiesat the same location owned by or undercommon control of the same person.

(dd) Potential production allowancesmeans the production allowancesobtained under § 82.9(a).

(ee) Production means themanufacture of a controlled substancefrom any raw material or feedstockchemical, but does not include: •(1) The manufacture of a controlledsubstance that is subsequentlytransformed;

(2) The reuse or recycling of acontrolled substance;

(3) Amounts that are destroyed by theapproved technologies; or

(4) Amounts that are spilled or ventedunintentionally.

(if) Production allowances means theprivileges granted by this subpart toproduce controlled substances;however, production allowances may beused to produce controlled substancesonly in conjunction with consumptionallowances. A person's productionallowances are the total of theallowances he obtains under §§ 82.7,82.5 and 82.9 as may be modified under§ 82.12 (transfer of allowances).

(gg) Transform means to use andentirely consume (except for tracequantities) a controlled substance in themanufacture of other chemicals forcommercial purposes.

(hh) Transhipment means thecontinuous shipment of a controlledsubstance from a foreign state of originthrough the United States or itsterritories to a second foreign state offinal destination.

(ii) Unexpended consumptionallowances means consumptionallowances that have not been used. Atany time in any control period aperson's unexpended consumptionallowances are the total of the level ofconsumption allowances the person hasauthorization under this subpart to holdat that time for that control period,minus the level of controlled substances

-that the person has produced orimported (not including transhipmentsand used or recycled controlledsubstances) in that control period untilthat time.

(jj) Unexpended productionallowances means productionallowances that have not been used. Atany time in any control period aperson's unexpended productionallowances are the total of the level ofproduction allowances he hasauthorization under this subpart to holdat that time for that control period,minus the level of controlled substancesthat the person has produced in thatcontrol period until that time.

(kk) Used or recycled controlledsubstances means controlled substancesthat have been recovered from theirintended use systems.

§82.4 Prohibfitons.(a) No person may produce, at any

time in any control period, any class Icontrolled substance (except forcontrolled substances that aretransformed or destroyed or substancesthat are produced pursuant to anexemption as specified in paragraph (k)of this section) in excess of the amountof unexpended production allowancesfor that substance held by that personunder the authority of this subpart atthat time for that control period. Everykilogram of excess productionconstitutes a separate violation of thissub part.

(b) No person may produce or (exceptfor transhipments, or for used orrecycled controlled substances) import,at any time in any control period, anyclass I controlled substance (except forcontrolled substances that aretransformed, destroyed, or substancesthat are produced or imported pursuantto an exemption as specified inparagraph (k) of this section) in excessof the amount of unexpendedconsumption allowances held by thatperson under the authority of thissubpart at that time for that controlperiod. Every kilogram of excessproduction or importation (other thantranshipments or used and recycledcontrolled substances) constitutes aseparate violation of this subpart.

(c) A person may not use productionallowances to produce a quantity of aclass I controlled substance (with theexceptions set forth in paragraph (a) ofthis section) unless he holds under theauthority of this subpart at the sametime consumption allowances sufficientto cover that quantity of class Icontrolled substances nor may a personuse consumption allowances to producea quantity of class I controlledsubstances (with the exceptions set forthin paragraph (a) of this section) unlessthe person holds under authority of thissubpart at the same time productionallowances sufficient to cover thatquantity of class I controlled substances.However, only consumption allowancesare required to import class I controlledsubstanceswith the exceptions set forthin paragraph (b) of this section.

d) No person may:(1) Import or export any quantity of a

controlled substance listed in Class I,Group I or Group II, in appendix A ofthis subpart from or to any foreign statenot listed as a Party to the 1987Montreal Protocol unless that foreignstate is complying with the 1987

Federal Register / VoL 58, No. 236 / Friday, December 10, 1993 / Rules and Regulations 65065

Montreal Protocol (As noted inappendix C, Annex 2 of this subpart);

(2) Import or export any quantity of acontrolled substance listed in Class I,Group III, Group IV or Group V, inappendix A of this subpart, from or toany foreign state not Party to theLondon Amendments (as noted inappendix C, Annex 1, of this subpart),unless that foreign state is complyingwith the London Amendments (as notedin appendix C, Annex 2, of thissubpart), or

(3] Import a controlled product fromany foreign state not Party to the 1987Montreal Protocol (as noted in appendixC. Annex 1, of this subpart), unless thatforeign state is complying with theProtocol (as noted in appendix C, Annex2, of this subpart).

(4) Every kilogram of a controlledsubstance, and every controlledproduct, imported or exported incontravention of this subpart constitutesa separate violation of this subpart

(e) Effective January 1, 2003, noperson may produce HCFC-141b exceptin a process resulting in itstransformation, use in a processresulting in destruction, or forexceptions stated in paragraph (1) of thissection.

() Effective January 1, 2003, noperson may mport HCFC-141b exceptfor use in a process resulting in itstransformation, use in a processresulting in destruction, or forexceptions stated in paragraph (1) of thissection.

(8) Effective January 1, 2010, noperson may produce or consumeexcluding used or recycled controlled

substances, or transhipments) HCFC-22or HCFC-142b for any purpose otherthan for use in a process resulting intheir transformation, use in a processresulting in their destruction, for use inequipment manufactured prior toJanuary 1, 2010, or for exceptions statedin paragraph (1) of this section in excessof baseline allowances allocated§§ 82.5(h) and 82.6(h).

(h) Effective January 1, 2020, noperson may produce or consume HCFC-22 or HCFC-142b (excluding used orrecycled controlled substances, ortranshipments) for any purpose otherthan for use in a process resulting intheir transformation, use in a processresulting in their destruction or forexceptions stated in paragraph (1) of thissection.

(I) Effective January 1, 2015, noperson may produce or consume class IIsubstance (excluding used or recycledcontrolled substances, or transhipments)not previously controlled, for anypurpose other than for use in a processresulting in Its transformation, use in aprocess resulting in their destruction, asa refrigerant in equipment manufacturedbefore January 1, 2020, or for exceptionsstated in paragraph (1) of this section, inexcess of baseline production andconsumption levels defined in§§ 82.5(h) and 82.6(h).

(j) Effective January 1, 2030 no personmay produce or import class II

substances, (excluding used or recycledcontrolled substances, or transhipments)for any purpose other than for use in aprocess resulting in theirtransformation, use in a processresulting in their destruction, or forexceptions stated in paragraph (1) of thissection.

(k) The following exemptions apply tothe production and consumptionrestrictions under paragraphs (a) and (b)of this section: [Reserved]

(1) The following exemptions apply tothe production and consumptionrestrictions under paragraphs (e), (0. (g),(h), (i) and (j) of this section:

(1) Medical Devices [Reserved](2) Exports to developing countries

[Reserved]

§82.5 Apportionment of baselineproduction allowances.

Persons who produced controlledsubstances in Group I or Group II in1986 are apportioned baselineproduction allowances as set forth inparagraphs (a) and (b) of this section.Persons who produced controlledsubstances in Group I, IV, or V in 1989are apportioned baseline productionallowances as set forth in paragraphs (c),(d), and (e) of this section. Persons whoproduced controlled substances inGroup VI and VII in 1991 areapportioned baseline allowances as setforth in paragraphs () and (g) of thissection.

Controlled Substance Person Allowances (kg)

(a) For Group I controlled substances:CFC-11 ..............................

CFC-12 ...............................

CFC-113 .............................

CFC--114 .............................

CFC-115 ........ ...........

Allied-Signal, Inc ...............................................................................................................E.I. DuPont de Nemours & Co .....................................................................................Elf Atochem , N.A ..............................................................................................................Laroche Chemicals ...........................................................................................................Allied-Signal, Inc ................................................................................................................E.I. DuPont do Nemours & Co ..........................................................................................Elf Atochem , N.A ...............................................................................................................Laroche Chemicals ..........................................................................................................Allied-Signal, Inc ...............................................................................................................E.I. DuPont de Nemours & Co ..........................................................................................Allied-Signal, Inc ................................................................................................................E.I. DuPont de Nemours & Co ..........................................................................................E.I. DuPont de Nemours & Co ................................

?3,082,35833,830,00021,821,50012,856,36435,699,77664,849,00031,089,80715,330,90921,788,89658,553,0001,488,5694,194,0004,176,000

826,4872,135,4843,220,0001,766,850

(b) For Group II controlled substances:Halon-1211 .......................... Great Lakes Chemical Corp ..................................................................................

ICI Americas, Inc .......................................................................................... ............Halon-1301 ....................... E.I. DuPont de Nemours & Co ....................................................................................

Great Lakes Chemical Corp ............................................................................................Halon-2402 ....................................................................(c) For Group III controlled substances:CFC-13 ............................... Allied-Signal, Inc ...............................................................................................................

E.I. DuPont do Nemours & Co ....................................... ........................................ .Elf Atochem, N.A ........................ I .....................................................................................Great Lakes Chemical Corp ..............................................................................................Laroche Chemicals ..........................................................................................................

CFC-1I...................................... ..........CFC-11 ..................................................................

..........C FC -1112 ............................. .................................... I........................................................................................................

127.125187,831

3,99256,38129.025


Controlled Substance Peison Allowances (kg),

CFC-211 ............................. E.I. DuPont do Nemours & Co .......................................................................................... 11CFC-212 .............. E.I. DuPont de Nemour & Co 11CFC-213 E.I. DuPont do Nemours & Co ..................................................................... ..................... 11CFC-214 ..... ......... E.I. DuPont de Nemours & Co ....................................................................................... 11CFC-215 ............................. E.I. DuPont de Nemours & Co ....................................................... 511

Halocarbon Products Corp ................................................................................................ 1,270CFC-216 ............................. E.I. DuPont de Nemours & Co ........................................................................ 170,574CFC-217 ............................. E.I. DuPont de Nemours & Co ...................................................................... 511

(d) For Group IV controlled substances:CCI4 ..................................... Akzo Chemicals, Inc .......................................................................................................... 7,873,615

Degussa Corporation ......................................................................................................... 26,546Dow Chemical Company, USA ......................................................................................... 18,987,747E.I. DuPont do Nemours & Co .......................................................................................... .9,099Hanlin Chemicals-WV, Inc ................................................................................................. 219,616ICI Americas, Inc ............................................................................................................... 853,714Occidental Chemical Corp ................................................................................................. 1,059,358Vulcan Chemicals ........................................................................................... 21,931,987

(e) For Group V controlled substances:Methyl chloroform ................ Dow Chemical Company, USA ......................................................................................... 168,030,117

E.I. DuPont de Nemours & Co ....................................................................................... . 2PPG Industries, Inc ............................................................................................................ 57,450,719Vulcan Chemicals .............................................................................................................. 89,689,064

(f) For Group VI controlled substances: [Reserved]I /For Group VII controlled substances: [Reserved]

For class II controlled substances: [Reserved]

§82.6 Apportionment of baseline consumption allowances.Persons who produced, imported, or produced and imported controlled substances in Group I or Group II in 1986

are apportioned chemical-specific baseline consumption allowances as set forth in paragraphs (a)and (b) of this section.Persons who produced, imported, or produced and imported controlled substances in Group I. Group IV, or GroupV in 1989 are apportioned chemical-specific baseline consumption allowances as set forth in paragraphs (c), (d), and(e) of this section. Persons who produced, imported, or produced and imported controlled substances in Group VIor VII in 1991 are apportioned chemical specific baseline consumption allowances as set forth in paragraphs (f) and(g) of this section.

Controlled substance Person Allowances (kg)

(a) For Group I controlled substances:CFC-1 I....... I ....................... Allied-Signal, Inc .......................................................................................................................... 22,683,833

E.I. DuPont do Nemours & Co .................................................................................................... 32,054,283Elf Atochem, N.A ......................................................................................................................... 21,740,194Hoechst Celanese Corporation ................................................................................................... 185,396ICI Americas, Inc ......................................................................................................................... 1,673,436Kali-Chemle Corporation ............................................................................................................ 82,500Laroche Chemicals .......... :............................................................................................................ 12,695,726National Refrigerants, Inc ............................................................................................................ 693,707Refricentro, Inc ........................................................... ............................................................... 160,697Sumitomo Corporation of America ............................................................................................. 5,800

CFC-12 ....................... Allied-Signal, Inc ......................................................................................................................... 35,236,397E.I. DuPont de Nemours & Co .................................................................................................. 61.098,726Elf Atochem, N.A ......................................................................................................................... 32,403,869Hoechst Celanese Corporation ................................................................................................... 138,865ICI Americas, Inc ......................................................................................................................... 1,264,980Kali-Chemie Corporation ............................................................................................................. 355,440Laroche Chemicals ...................................................................................................................... 15,281,553National Refrigerants, Inc ....................................................................................................... 2,375,384Refticentro, Inc ............................................................................................................................ 242,526

CFC-113 ............................. Allied-Signal, Inc.18,241,928.E.I. DuPont de Nemours & Co ........................................................................... 49,602,858Elf Atochem, N.A ........................................................................................................................ 244,908Holchem ....................................................................................................................................... 265,199ICI Americas, Inc ......................................................................................................................... 2,399,700Refrlcentro, Inc ............................................................................................................................ 37,385Sumitomo Corporation of America .............................................................................................. 280,163

CFC-1 14 ............................. Allied-Signal, Inc .......................................................................................................................... 1,429,582E.I. DuPont de Nemours & Co .................................................................................................... 3,686,103Elf Atochem, N.A ......................................................................................................................... 22,880ICI Americas, Inc ......................................................................................................................... 32,930

CFC-115 ............................ E.I. DuPont de Nemours & Co ...................................................... 2,764,109Elf Atochem, N.A ......................................................................................................................... 633,007


Controlled substance Person Allowances (kg)

Hoechst Celanese Corporation ..................................................... 8,893ICI Am ericas, Inc ....................................................................................................................... . 2,366,351Laroche Chemicals ...................................................................................................................... 135,520Refricentro, Inc ............................................................................................................................ 27,337

(b) For Group II controlled substances:Halon-1211 .......................... Elf Atochem , N.A ......................................................................................................................... 411,292

Great Lakes Chemical Corp ........................................................................................................ 772,775ICI Americas, Inc ............................................................................................................. ;........... 2,116,641Kali-Chemie Corporation ............... ! .......................... ......................................................... 330,000

Halon-1301 ........................ E.I. DuPont de Nemours & Co ...................................................... 2,772,917Elf Atochem , N.A ......................................................................................................................... . 89,255Great Lakes Chemical Corp ...................................................................................................... 1,744,132Kali-Chemle Corporation ............................................................................................................ 54,380

Halon-2402 .......................... Ausimont ...................................................................................................................................... 34,400Great Lakes Chemical Corp ....................................................................................................... 15,900

(c) For Group III controlled substances:CFC-13 ............................... Allied-Signal, Inc .......................................................................................................................... 127,124

E.I. DuPont de Nemours & Co ................................................................................................... 158,508Elf Atochem , N.A ......................................................................................................................... 3,992Great Lakes Chemical Corp ........................................................................................................ 56,239ICI Am ericas, Inc ......................................................................................................................... 5,855Laroche Chemicals ...................................................................................................................... 29,025.National Refrigerants, Inc ........................................................................................................... 16,665

CFC--I 11CFC-1 12 ............................. Sumitomo Corporation of America ...................................... ...................................... 5,912

TG (USA) Corporation ................................................................................................................. 9,253CFC-211 ............................. E.I. DuPont de Nemours & Co .................................................................................................... 11CFC-212 ............................. E.I. DuPont de Nemours & Co ................................. .............................. ....... 11CFC-213 ............................. E.I. DuPont de Nemours & Co ................................................................................................... 11CFC-214 ............................. E.I. DuPont de Nemours & Co ..................... .......... ........ .................................. 11CFC-215 ............................. E.I. DuPont de Nemours & Co .................................................................................................... 511

Halocarbop Products Corp .......................................................................................................... 1,270CFC-216 ............................. E.I. DuPont de Nemours & Co ........................................................ 170,574CFC-217 ............................. E.I. DuPont de Nemours & Co ............... I ...... ............................................ 511.(d)For Group IV controlled substances:CC14 ............................. Cre scent Chem ical Co .............................................................................................................. 56

Degussa Corporation ................................................................................................................... 12,466Dow Chemical Com pany, USA .................................................. 8,170,561E.I. DuPont de Nemours & Co .................................................................................................... 26,537Elf Atochem , N.A ......................................................................................................................... 41Hanlin Chemicals-W V, Inc ........................................................................................................... 103,133Hoechst Celanese Corporation ................................................................................................ 3ICC Chemical Co rp ...................................................................................................................... 1,173,723ICI Am ericas, Inc ......................................................................................................................... 855,466Occidental Chemical Corp ........................................................................................................... 497,478Sumitomo Corporation of America ........................................................................................... . 9

(e) For Group V controlled substances:Methyl Chloroform ........ l...... 3V Chemical Corp ....................................................................................................................... 3,528

Actex, Inc ..................................................................................................................................... 50,171Atochem North Am erica .............................................................................................................. 74,355Dow Chemical Company, USA ................................................................................................... 125,200,200E.I. DuPont de Nemours & Co ................................................................................................. 2IBM ............................. ........ ............................................... 2,026ICI Am ericas, .Inc ......................................................................................................................... 14,179,850Laidlaw ..................... ......... . . .................................. 420,207PPG Industries ............................................................................................................................. 45,254,115Sumitomo ..................................................................................................................................... 1,954TG (USA) Corporation ................................................................................................................. 7,073Unitor Ships Service, Inc ............................................................................................................. 14,746Vulcan Chemicals ......................................................................................................................... 70,765,072

(f) For Group VI controlled substances: [Reserved]fjg For Group VII controlled substances: [Reserved]For Class II controlled substances: [Reserved]


§82.7 Grant and phased reduction of baseline production and consumption allowances for class I controlled substances.For each control period specified in the following table, each person is granted the specified percentage of the

baseline production and consumption allowances apportioned to him under §§ 82.5 and 82.6.

Class I sub- Class I sub- Class I sub- Class I sub- Class I sub- Class I sub-stances In stances in stances in stances in stances in stances inControl period roups I and group II group IV group V group VI group VII

III (percent) (percent) (percent) (percent) (percent) (percent)

1994 ............................................................................... 25 0 50 50 100 1001995 ............................................................................... 25 0 15 30 100 1001996 .............................................................................. 0 0 0 0 100 01997 ............................................................................... 0 0 0 0 100 01998 ............................................................................... 0 0 0 0 100 01999 ...............................................................................0 0 0 0 100 02000 ............................................................................... 0 0 0 0 100 02001 ...................... ............... 0... ... 0 0 0 0 0

§82.8 Grant and phased reduction ofbaseline production and consumptionallowances for class U controlledsubstances. [Reserved]

§82.9 Availability of productionallowances in addition to baselineproduction allowances.

(a) Every person apportioned baselineproduction allowances for class Icontrolled substances under § 82.5 (a)through (e) is also granted potentialproduction allowances equal to:

(1) 10 percent of his apportionmentunder § 82.5 for each control periodending before January 1, 2000; and

(2) 15 percent of his apportionmentunder § 82.5 for each control periodbeginning after December 31, 1999 andending before January 1, 2011 (January1, 2013 in the case of methylchloroform).

(3) A person may convert potentialproduction allowances, either grantedunder this paragraph (a) or obtainedunder § 82.12 (transfer of allowances), toproduction allowances only to theextent authorized by the Administratorunder § 82.11 (Exports to Article 5Parties). A person may obtainauthorizations to convert potentialproduction allowances to productionallowances by requesting issuance of anotice under § 82.11 or by completing atransfer of authorizations under § 82.12.

(b) A person may also increase ordecrease its production allowances bytrading with another Party to theProtocol. A nation listed in appendix C,Annex 1 of this subpart (Parties to theMontreal Protocol) must agree either totransfer to the person for the currentcontrol period some amount ofproduction that the nation is permittedunder the Montreal Protocol or toreceive from the person for the currentcontrol period some amount ofproduction that the person is permittedunder this subpart. A request forproduction allowances shall also beconsidered a request for consumptionallowances under § 82.10(c).

(1) For trades from a Party, the personmust obtain from the principaldiplomatic representative in thatnation's embassy in the United States asigned document stating that theappropriate authority within that nationhas established or revised productionlimits for the nation to equal the lesserof the maximum production that thenation is allowed under the Protocolminus the amount transferred, themaximum production that is allowedunder the nation's applicable domesticlaw minus the amount transferred, orthe average of the nation's actualnational production level for the threeyears prior to the transfer minus theproduction allowances transferred. Theperson must submit to theAdministrator a transfer request thatincludes a true copy of this documentand that sets forth the following:

(i) The identity and address of theperson;

(ii) The identity of the Party;(iii) The names and telephone

numbers of contact persons for the.person and for the Party; -

(iv) The chemical type and level ofproduction being transferred;

(v) The control period(s) to which thetransfer applies; and

(vi) A signed statement by the Personthat this increased production isintended as an export to the Party.

(2) For trades to a Party, a personmust submit a transfer request that setsforth the following:


(ii) The identity of the Party;(iii) The names and telephone

numbers of contact persons for theperson and for the Party;

(iv) The chemical type and level ofallowable production to be transferred;and

(v) The control period(s) to which thetransfer applies.

(3) After receiving a transfer requestthat meets the requirements of

paragraph (b)(2) of this section, theAdministrator may, at his discretion,consider the following factors indeciding whether to approve such atransfer:

(i) Possible creation of economichardship;

(ii) Possible effects on trade;(iii) Potential environmental

implications; and(iv) The total amount of unexpended

production allowances held by UnitedStates entities.

(4) The Administrator will issue theperson a notice either granting ordeducting production allowances andspecifying the control periods to whichthe transfer applies, provided that therequest meets the requirement ofparagraph (b)(1) of this section for tradesfrom Parties and paragraph (b)(2) of thissection for trades to Parties, unless theAdministrator has decided todisapprove the trade under paragraph(b)(3) of this section for trades to Parties,For a trade from a Party, theAdministrator will issue a notice thatrevises the allowances held by theperson to equal the unexpendedproduction allowances held by theperson under this subpart plus the levelof allowable production transferredfrom the Party. For a trade to a Party, theAdministrator will issue a notice thatrevises the production limit for theperson to equal the lesser of:

(ii) The unexpended productionallowances held by the person underthis subpart minus the amounttransferred; or

(ii) The unexpended productionallowances held by the person underthis subpart minus the amount by whichthe United States average annualproduction of the controlled substancebeing traded for the three years prior tothe transfer is less than the totalallowable production allowable for thatsubstance under this subpart minus theamount transferred. The change in


allowances will be effective on the datethat the notice is issued.

(5) If after one person obtainsapproval for a trade of allowableproduction of a controlled substance toa Party, one or more other personsobtain approval for trades involving thesame controlled substance and the samecontrol period, the Administrator willissue notices revising the productionlimits for each of the other personstrading that controlled substance in thatcontrol period to equal the lesser of:

i) The unexpended productionallowances held by the person underthis subpart minus the amounttransferred; or

(ii) The unexpended productionallowances held by the person underthis subpart minus (the amount by 'which the United States average annualproduction of the controlled substancebeing traded for the three years prior tothe transfer is less than the totalallowable production for that substanceunder this subpart) multiplied by theamount transferred divided by (the totalamount transferred by all the otherpersons trading the same controlledsubstance in the same control period)minus the amount transferred by thatperson.

(iii) The Administrator will also issuea notice revising the production limitfor each person who previouslyobtained approval' of a trade of thatsubstance in that control period to equalthe unexpended production allowancesheld by the person under this subpartplus the amount by which the UnitedStates average annual production of thecontrolled substance being traded forthe three years prior to the transfer isless than the total allowable productionunder this subpart multiplied by theamount transferred by that persondivided by (the amount transferred byall of the persons that have traded thatcontrolled substance in that controlperiod). The change in productionallowances will be effective on the datethat the notice is issued.

(c) A person may obtain productionallowances for that controlled substanceequal to the amount of that controlledsubstance produced in the United Statesthat was transformed or destroyedwithin the United States in cases whereproduction allowances were expendedto produce such substance inaccordance with the provisions of thisparagraph. A request for productionallowances under this section will beconsidered a request for consumptionallowances under § 82.10(b).

(1) A person must submit a request forproduction allowances that includes thefollowing:


(ii) The name, quantity, and level ofcontrolled substance transformed or thename, quantity and volume destroyed;

(iii) A copy of the invoice or receiptdocumenting the sale of the controlledsubstance to the person;

(iv) A certification that productionallowances were expended, for theproduction of the controlled substance;

(v) If the controlled substance istransformed, the name, quantity, andverification of the commercial use of theresulting chemical transformed; and

[vi) If the controlled substance isdestroyed, the efficiency of thedestruction process.

(2) The Administrator will review theinformation and documentationsubmitted under paragraph (c)(1) of thissection and will assess the quantity ofclass I controlled substance that thedocumentation and information verifieswas transformed or destroyed. TheAdministrator will issue the personproduction allowances equivalent to thecontrolled substances that theAdministrator determines weretransformed or destroyed. For controlledsubstances completely destroyed underthis subpart, the Agency will grantallowances equal to 100 percent ofvolume intended for destruction. Forthose controlled substances destroyed atless than a 98 percent destructionefficiency, the Agency will grantallowances commensurate with thatpercent of destruction efficiency that isactually achieved. The grant ofallowances will be effective on the datethat the notice is issued.

(3) If the Administrator determinesthat the request for productionallowances does not satisfactorilysubstantiate that the person transformedor destroyed controlled substances asclaimed, or that modified allowanceswere not expended, the Administratorwill issue a notice disallowing therequest for additional productionallowances. Within ten working daysafter receipt of notification, the personmay file a notice of appeal, withsupporting reasons, with theAdministrator. The Administrator mayaffirm the disallowance or grant anallowance, as he finds appropriate inlight of the available evidence. If noappeal is taken by the tenth day afternotification, the disallowance will befinal on that day.

§82.10 Availability of consumptionallowances in addition to baselineconsumption allowances.

(a) Any person may obtain, inaccordance with the provisions of thissection, consumption allowances

equivalent to the level of class Icontrolled substances (other than usedor recycled controlled substances or atransshipment) that the person hasexported from the United States and itsterritories to a Party (as listed inappendix C, Annex 1 of this subpart),other than a transshipment.

(1) The exporter of the class Icontrolled substances must submit tothe Administrator a request forconsumption allowances setting forththe following:

(i) The identities and addresses of theexporter and the recipient of theexports;Iii) The exporter's Employer

Identification Number;(iii) The names and telephone

numbers of contact persons for theexporter and the recipient;

(iv) The quantity and-type ofcontrolled substances exported;

v) The source of the controlledsubstance and the date purchased;

(vi) The date on which and the portfrom which the controlled substanceswere exported from the United States orits territories;

(vii) The country to which thecontrolled substances were exported;

(viii) The bill of lading and theinvoice indicating the net quantity ofcontrolled substances shipped anddocumenting the sale of the controlledsubstances to the purchaser; and

(ix) The commodity code of thecontrolled substance exported.

(2) The Administrator will review theinformation and documentationsubmitted under paragraph (a)(1) of thissection, and will assess the quantity ofcontrolled substances that thedocumentation verifies was exported.The Administrator will issue theexporter consumption allowancesequivalent to the level of controlledsubstances that the Administratordetermined was exported. The grant ofthe consumption allowances will beeffective on the date the notice is issued.

(b) A person may obtain consumptionallowances for that controlled substanceequal to the amount of a controlledsubstance either produced in orimported into the United States that wastransformed or destroyed in the UnitedStates in the case where consumptionallowance were expended to produce orimport such substance in accordancewith the provisions of this paragraph.

(1) A person must submit a request forconsumption allowances that includesthe following:


(ii) The name, quantity, and level ofcontrolled substance transformed or thename, quantity and volume destroyed;


(iii) A copy of the invoice or receiptdocumenting the sale of the controlledsubstance to the person;

(iv) A certification that productionand/or consumption allowances wereexpended for the production and/orimport of the controlled substance;

v) If the controlled substance istransformed, the name, quantity, andverification of the commercial use of theresulting chemical transformed; and

(vi) If the controlled substance isdestroyed, the efficiency of thedestruction process.

(2) The Administrator will review theinformation and documentationsubmitted under paragraph (b)(1) of.thissection and will assess the quantity ofcontrolled substance that thedocumentation and information verifiedwas transformed or destroyed. TheAdministrator will issue to the personconsumption allowances equivalent tothe level of controlled substances thatthe Administrator determines wastransformed or destroyed. For controlledsubstances completely destroyed underthis subpart, the Agency will grantallowances equal to 100 percent ofvolume intended for destruction. Forthose controlled substances destroyed atless than a 98 percent destructionefficiency, the Agency will grantallowances commensurate with thatpercent of destruction efficiency that isactually achieved. The grant ofallowances will be effective on the datethat the notice is issued.

(3) If the Administrator determinesthat the request for consumptionallowances does not satisfactorilysubstantiate that the person transformedor destroyed controlled substances asclaimed, or that production orconsumption allowances had not beenexpended, the Administrator will issuea notice disallowing the request foradditional consumption allowances.Within ten working days after receipt ofnotification, the person may file a noticeof appeal, with supporting reasons, withthe Administrator. The Administratormay affirm or vacate the disallowance.If no appeal is taken by the tenth dayafter notification, the disallowance willbe final on that day.

(c) A person may also increase itsconsumption allowances by receivingproduction from another Party to theProtocol. A nation listed in appendix C,Annex I of this subpart (Parties to theMontreal Protocol) must agree totransfer to the person for the currentcontrol period some amount ofproduction that the nation is permittedunder the Montreal Protocol. A requestfor consumption allowances shall alsobe considered a request for productionallowances under § 82.9(b). For trades

from a Party, the person must obtainfrom the principal diplomaticrepresentative in that nation's embassyin the United States a signed documentstating that the appropriate authoritywithin that nation has established orrevised production limits for the nationto equal the lesser of the maximumproduction that the nation is allowedunder the Protocol minus the amounttransferred, the maximum productionthat is allowed under the nation's.applicable domestic law minus theamount transferred, or the average of thenation's actual national production levelfor the three years prior to the transferminus the production allowancestransferred. The person must submit tothe Administrator a transfer request thatincludes.a true copy of this documentand that sets forth the following:

(1) The identity and address of theperson;

(2) The identity of the Party;(3) The names and telephone numbers

of contact persons for the person and forthe Party;

(4) The chemical type and level ofproduction being transferred;

(5) The control period(s) to which thetransfer applies; and

(6) A signed statement by the personthat this increased production isIntended as an export to the Party.

§82.11 Exports to Article 5 Parties..In accordance with the provisions of

this section, any person may obtainauthorizations to convert potentialproduction allowances to productionallowances by exporting class Icontrolled substances (not includingtransshipments, or used or recycledcontrolled substances) to foreign stateslisted in appendix E to this subpart(Article 5 Parties). Authorizationsobtained under this section will be validonly during the control period in whichthe controlled substance departed theUnited States. A request forauthorizations under this section will beconsidered a request for consumptionallowances under § 82.10(a) as well.

(a) The exporter must submit to theAdministrator a request for authority toconvert potential production allowanceto production allowances. That requestmust set forth the following:

(1] The identities and addresses of theexporter and the recipient of theexports;

(2) The exporter's EmployeeIdentification Number;

(3) The names and telephone numbersof contact persons for the exporter andfor the recipient;

(4) The quantity and the type ofcontrolled substances exported, itssource and date purchased;

(5) The date on which and the portfrom which the controlled substanceswere exported from the United States orits territories;

(6) The country to which thecontrolled substances were exported;

(7) A copy of the bill of lading andinvoice indicating the net quantityshipped and documenting the sale ofthe controlled substances to thepurchaser;

(8) The commodity code of thecontrolled substance exported; and

(9) A copy of the contract covering thesale of the controlled substances to therecipient that contains provisionsforbidding the reexport of the controlledsubstance in bulk form and subjectingthe recipient or any transferee of therecipient to liquidated damages equal tothe resale price of the controlledsubstances if they are reexported in bulkform.

(b) The Administrator will review theinformation and documentationsubmitted under paragraph (a) of thissection, and assess the quantity ofcontrolled substances that thedocumentation verifies were exported toan Article 5 Party. Based on thatassessment, the Administrator will issuethe exporter a notice authorizing theconversion of a specified quantity ofpotential production allowances toproduction allowances in a specifiedcontrol year, and granting'consumptionallowances in the same amount for thesame control year. The authorizationsmay be used to convert potentialproduction allowances to productionallowances as soon as the date on whichthe notice is issued.

§82.12 Transfers.(a) Inter-company transfers. Any

person ("transferor") may transfer toany other person ("transferee") anyamount of the transferor's consumptionallowances, production allowances,potential production allowances, orauthorizations to convert potentialproduction allowances to productionallowances, as follows:

(1) The transferor must submit to theAdministrator a transfer claim settingforth the following:

(i) The identities and addresses of thetransferor and the transferee;

(ii) The name and telephone numbers'of contact persons for the transferor andthe transferee;

(iii) The type of allowances orauthorizations being transferred,including the names of the controlledsubstances for which allowances are tobe transferred;

(iv) The group of controlledsubstances to which the allowances or


authorizations being transferredpertains;

(v) The amount of allowances orauthorizations being transferred;

(vi) The control period(s) for whichthe allowances or authorizations arebeing transferred;

(vii) The amount of unexpendedallowances or authorizations of the typeand for the control period beingtransferred that the transferor holdsunder authority of this subpart as of thedate the claim is submitted to EPA; and

(viii) The amount of the one-percentoffset applied to the unweighted amounttraded that will be deducted from thetransferor's allowance balance (exceptfor trades of potential productionallowances, authorizations to convert ortrades from transformers and destroyersto producers or importers for thepurpose of allowance reimbursement).

(2) The Administrator will determinewhether the records maintained by EPA,taking into account any previoustransfers and any production, allowableimports and exports of controlledsubstances reported by the transferor,indicate that the transferor possesses, asof the date the transfer claim isprocessed, unexpended allowances orauthorizations sufficient to cover thetransfer claim (i.e., the amount to betransferred plus, in the case oftransfeors of production orconsumption allowances, one percent ofthat amount). Within three workingdays of receiving a complete transferclaim, the Administrator will takeaction to notify the transferor andtransferee as follows:

(i) If EPA's records show that thetransferor has sufficient unexpendedallowances or authorizations to coverthe transfer claim or if review ofavailable information is insufficient tomake a determination, theAdministrator will issue a noticeindicating that EPA does not object tothe transfer and will reduce thetransferor's balance of unexpendedallowances or authorizations by theamount to be transferred plus, in thecase of transfers of production orconsumption allowances, one percent ofthat amount. When EPA issues a noobjection notice, the transferor and thetransferee may proceed with thetransfer. However, if EPA ultimatelyfinds that the transferor did not havesufficient unexpended allowances orauthorizations to cover the claim, thetransferor and transferee will be heldliable for any violations of theregulations of this subpart that occur asa result of, or in conjunction with, theimproper transfer.

ii) If EPA's records show that thetransferor has insufficient unexpended

allowances or authorizations to coverthe transfer claim, or that the transferorhas failed to respond to one or moreAgency requests to supply informationneeded to make a determination, theAdministrator will issue a noticedisallowing the transfer. Within 10working days after receipt ofnotification, either party may file anotice of appeal, with supportingreasons, with the Administrator. TheAdministrator may affirm or vacate thedisallowance. If no appeal is taken bythe tenth working day after notification,the disallowance shall be final on thatda3)- In the event that the Administrator

does not respond to a transfer claimwithin the three working days specifiedin paragraph (b)(2) of this section, thetransferor and transferee may proceedwith the transfer. EPA will reduce thetransferor's balance of unexpendedallowances or authorizations by theamount to be transferred plus, in thecase of transfers of production orconsumption allowances, one percent ofthat amount. However, if EPAultimately finds that the transferor didnot have sufficient unexpendedallowances or authorizations to coverthe claim, the transferor and transfereewill be held liable for any violations ofthe regulations of this subpart that occuras a result of, or in conjunction with, theimproper transfer.

(b) Inter-pollutant conversions. Anyperson ("convertor") may convertconsumption allowances, productionallowances, potential productionallowances, or authorizations to convertpotential production allowances toproduction allowances for one class Icontrolled substance to the same type ofallowance for another class I controlledsubstance within the group of controlledsubstances as the first as follows:

(1) The convertor must submit to theAdministrator a conversion claimsetting forth the following:

(i) The identity and address of theconvertor;

{ii) The name and telephone numberof a contact person for the convertor;

(iii) The type of allowances orauthorizations being converted,including the names of the controlledsubstances for which allowances are tobe converted;

(iv) The group of controlledsubstances to which the allowances orauthorizations being converted pertains;

(v) The amount and type ofallowances to be converted;

(vi) The amount of allowances to besubtracted from the convertor'sunexpended allowances for the firstcontrolled substance, to be equal to 101percent of the amount of allowances

converted (except for conversions ofauthorizations to convert potentialproduction allowances and conversionsof potential production allowances);

(vii) The amount of allowances orauthorizations to be added to theconvertor's unexpended allowances orauthorizations for the second controlledsubstance, to be equal to the amount ofallowances for the first controlledsubstance being converted multiplied bythe quotient of the ozone depletionfactor of the first controlled substancedivided by the ozone depletion factor ofthe second controlled substance, aslisted in appendix A of this subpart;

(viii) The control period(s) for whichthe allowances or authorizations arebeing converted; and

(ix) The amount of unexpendedallowances or authorizations of the typeand for the control period beingconverted that the convertor holdsunder authority of this subpart as of thedate the claim is submitted to EPA;

(2) The Administrator will determinewhether the records maintained by EPA,taking into account any previousconversions, any transfers, and anyproduction, imports (not includingtranshipments, or used and recycledcontrolled substances), or exports (notincluding transhipments, or used andrecycled controlled substances) ofcontrolled substances reported by theconvertor, indicate that the convertorpossesses, as of the date the conversionclaim is processed, unexpendedallowances or authorizations sufficientto cover the conversion claim (i.e., theamount to be converted plus, in the caseof conversions of production orconsumption allowances, one percent ofthat amount). Within three workingdays of receiving a complete conversionclaim, the Administrator will takeaction to notify the convertor as follows:

i) If EPA's records show that theconvertor has sufficient unexpendedallowances or authorizations to coverthe conversion claim or if review ofavailable information is insufficient tomake a determination, theAdministrator will issue a noticeindicating that EPA does not object tothe conversion and will reduce theconvertor's balance of unexpendedallowances or authorizations by theamount to be converted plus, in the caseof conversions of production orconsumption allowances, one percent ofthat amount. When EPA issues a noobjection notice, the convertor mayproceed with the conversion. However,if EPA ultimately finds that theconvertor did not have sufficientunexpended allowances orauthorizations to cover the claim, theconvertor will be held liable for any


violations of the regulations of thissubpart that occur as a result of, or inconjunction with, the improperconversion.

(ii) If EPA's records show that theconvertor has insufficient unexpendedallowances or authorizations to coverthe conversion claim, or that theconvertor has failed to respond to oneor more Agency requests to supplyinformation needed to make adetermination, the Administrator willissue a notice disallowing theconversion. Within 10 working daysafter receipt of notification, theconvertor may file a notice of appeal,with supporting reasons, with theAdministrator. The Administrator mayaffirm or vacate the disallowance. If noappeal is taken by the tenth working dayafter notification, the disallowance shallbe final on that day.

(3) In the event that the Administratordoes not respond to a conversion claimwithin the three working days specifiedin paragraph (b)(2) of this section, theconvertor may proceed with theconversion. EPA will reduce theconvertor's balance of unexpendedallowances by the amount to beconverted plus, in the case ofconversions of production orconsumption allowances, one percent ofthat amount. However, if EPAultimately finds that the convertor didnot have sufficient unexpendedallowances or authorizations to coverthe claims, the convertor will be heldliable for any violations of theregulations of this subpart that occur asa result of, or in conjunction with, theimproper conversion.

(c) Inter-company transfers and Inter-pollutant conversions. If a personrequests an inter-company transfer andan inter-pollutant conversionsimultaneously, the amount subtractedfrom the convertor-transferor'sunexpended allowances for the firstcontrolled substance will be equal to101 percent of the amount of allowancesconverted and transferred in the case oftransfer-conversions of production orconsumption allowances.

§82.13 Record-keeping and reportingrequirements.

ka) Unless otherwise specified, therecordkeeping and reportingrequirements set forth in this sectiontake effect on January 1, 1994.

(b) Reports and records required bythis section may be used for purposes ofcompliance determinations. Theserequirements are not intended as alimitation on the use of other evidenceadmissible under the Federal Rules ofEvidence.

(c) Unless otherwise specified, reportsrequired by this section must be mailedto the Administrator within 45 days ofthe end of the applicable reportingperiod.

(d) Records and copies of reportsrequired by this section must beretained for three years.

(e) In reports required by this section,quantities of controlled substances mustbe stated in terms of kilograms.

(f) Every person ("producer") whoproduces class I controlled substancesduring a control period must complywith the following recordkeeping andreporting requirements:

(1) Within 120 days of December 10,1993, or within 120 days of the date thata producer first produces a class Icontrolled substance, whichever is later,every producer who has not alreadydone so must submit to theAdministrator a report describing:

(i) The method by which the producerin practice measures daily quantities ofcontrolled substances produced;

(ii) Conversion factors by which thedaily records as currently maintainedcan be converted into kilograms ofcontrolled substances produced,including any constants or assumptionsused in making those calculations (e.g.,tank specifications, ambienttemperature or pressure, density of thecontrolled substance);

(iii) Internal accounting proceduresfor determining plant-wide production;

(iv) The quantity of any fugitive lossesaccounted for in the production figures;and

(v) The estimated percent efficiency ofthe production process for thecontrolled substance.

Within 60 days of any change in themeasurement procedures or theinformation specified in the report inparagraph (b), the producer must submita report specifying the revised data orprocedures to the Administrator.

(2) Every producer of a class Icontrolled substance during a controlperiod must maintain the followingrecords:

(i) Dated records of the quantity ofeach controlled substance produced ateach facility;

(ii) Dated records of the quantity ofcontrolled substances produced for usein processes that result in theirtransformation or for use in processesthat result in their destruction andquantity sold for use in processes thatresult in their transformation or for usein processes that result in theirdestruction;

(iii) Copies of invoices or receiptsdocumenting sale of controlledsubstance for use in processes resulting

in their transformation or for use inprocesses resulting in destruction:

(iv) Dated records of the quantity ofeach controlled substance used at eachfacility as feedstocks or destroyed in themanufacture of a controlled substanceor in the manufacture of any othersubstance, and any controlled substanceintroduced into the production processof the same controlled substance at eachfacility;

(v) Dated records identifying thequantity of each chemical not acontrolled substance produced withineach facility also producing one or morecontrolled substances;

(vi) Dated records of the quantity ofraw materials and feedstock chemicalsused at each facility for the productionof controlled substances;

(vii) Dated records of the shipments ofeach controlled substance produced ateach plant;

(viii) The quantity of controlledsubstances, the date received, andnames and addresses of the source ofrecyclable or recoverable materialscontaining controlled substances whichare recovered at each plant;

(ix) Records of the date, the controlledsubstance, and the estimated quantity ofany spill or release of a controlledsubstance that equals or exceeds 100pounds; and

(x) Copies of IRS certification that thecontrolled substance will betransformed or the verification that itwill be destroyed.

(3) For each quarter, each producer ofa class I controlled substance mustprovide the Administrator with a reportcontaining the following information:

(i) The production by company in thatquarter of each controlled substance,specifying the quantity of any controlledsubstance used in processing, resultingin its transformation by the producer;

(ii) The amount of production for usein processes resulting in destruction ofcontrolled substances by the producer;

(iii) The levels of production(expended allowances) for eachcontrolled substance;

(iv) The producer's total of expendedand unexperded consumptionallowances, potential productionallowances, production allowances, andauthorizations to convert potentialproduction allowances to productionallowances, as of the end of that quarter;

(v) The quantity, the date received,and names and addresses of the sourcesof recyclable and recoverable materialscontaining the controlled substanceswhich are recovered;

(vi) The amount of controlledsubstance sold or transferred during thequarter to a person other than theproducer for use in processes resulting


in its transformation or eventualdestruction; and

(vii) Internal Revenue ServiceCertificates in the-case oftransformation, or the purchaser'sdestruction verification in the case ofdestruction, showing that the purchaseror recipient of a controlled substanceintends to either transform or destroythe controlled substance.

(4) For any person who fails tomaintain the records required by thisparagraph (f), or to submit the reportrequired by this paragraph (0, theAdministrator may assume that theperson has produced at full capacityduring the period for which recordswere not kept, for purposes ofdetermining whether the person hasviolated the prohibitions at § 82.4.

(g) Importers of class I controlledsubstances during a control period mustcomply with recordkeeping andreporting requirements specified in thissection.

(1) Any importer of a class Icontrolled substance must maintain thefollowing records:

i) The quantity of each controlledsubstance imported, either alone or inmixtures, including the percentage ofeach mixture which consists of acontrolled substance;

(ii) The quantity of controlledsubstances other than transhipments orused or recycled substances importedfor use in processes resulting in theirtransformation or destruction andquantity sold for use in processes thatresult in their destruction ortransformation;

(iii) The date on which the controlledsubstances were imported;

)iv) The port of entry through whichthe controlled substances passed;

(v) The country from which theimported controlled substances wereimported;

(vi) The commodity code for thecontrolled substances shipped;

(vii) The importer number for theshipment;

(viii) A copy of the bill of lading forthe import;

(ix) The invoice for the import;(x) The quantity of imports of used

and recycled class I controlledsubstances and class II controlledsubstances;

(xi) The U.S. Customs entry form;(xii) Dated records documenting the

sale or transfer of controlled substancesfor use in process resulting intransformation or destruction; and

(xiii) Copies of IRS certifications thatthe controlled substance will betransformed or destruction verificationsthat it will be destroyed.

(2) Reporting Requirements-Importers.For each quarter, every importer of a

class I controlled substance must submitto the Administrator a report containingthe following information:

(i) Summaries of the records requiredin paragraphs (g)(1) (i) through (vii) ofthis section for the previous quarter;

(ii) The total quantity imported inkilograms of each controlled substancefor that quarter;

(iii) The levels of import (expendedconsumption allowances) of controlledsubstances for that quarter and totaledby chemical for the control-period-to-date;

(iv) The importer's total sum ofexpended and unexpendedconsumption allowances by chemical asof the end of that quarter;

v) The amount of controlledsubstances imported for use inprocesses resulting in theirtransformation or destruction;

(vi) The amount of controlledsubstances sold or transferred duringthe quarter to each person for use inprocesses resulting in theirtransformation or eventual destruction;

(vii) Internal Revenue ServiceCertificates showing that the purchaseror recipient of imported controlledsubstances intends to transform thosesubstances or destruction verificationsshowing that purchaser or recipientintends to destroy the controlledsubstances.

(h Reporting Requirements-Exporters.For any exports of class I controlledsubstances not reported under § 82.10(additional consumption allowances) or§ 82.11 (Exports to Parties), the exporterwho exported a class I controlledsubstances must submit to theAdministrator the following informationwithin 45 days after the end of thecontrol period in which the unreportedexports left the United States:

1) The names and addresses of theexporter and the recipient of theexports;(2) The exporter's Employee

Identification Number;(3) The type and quantity of each

controlled substance exported and whatpercentage, if any, of the controlledsubstance are recycled or used;

(4) The date on which and the portfrom which the controlled substanceswere exported from the'United States orits territories;

(5) The country to which thecontrolled substances were exported;and

(6) The commodity code of thecontrolled substance shipped.

(i) Every person who has requestedad ditional production allowances under§ 82.9(c) or consumption allowancesunder § 82.10(b) or who transforms ordestroys class I controlled substances

not produced by that person mustmaintain the following:

(1) Dated records of the quantity andlevel of each controlled substancetransformed or destroyed;

(2) Copies of the invoices or receiptsdocumenting the sale or transfer of thecontrolled substance to the person;

(3) In the case where those controlledsubstances are transformed, datedrecords of the names, commercial use,and quantities of the resultingchemical(s);

(4) In the case where those controlledsubstances are transformed, datedrecords of shipments to purchasers ofthe resulting chemical(s);

(5) Dated records of all shipments ofcontrolled substances received by theperson, and the identity of the produceror importer of the controlled substances;

(6) Dated records of inventories ofcontrolled substances at each plant onthe first day of each quarter; and

(7) A copy of the person's IRScertification of intent to transform or thepurchaser's destruction verification ofintent to destroy, in the case wheresubstances were purchased fortransformation or destruction purposes.

j) Persons who destroy class Icontrolled substances shall provide EPAwith a one-time report stating thedestruction unit's destruction efficiencyand the methods used to record thevolume destroyed and those used todetermine destruction efficiency and thename of other relevant Federal or stateregulations that may apply to thedestruction process. Any changes to theunit's destruction efficiency or methodsused to record volume destroyed and todetermine destruction efficiency mustbe reflected in a revision to this reportto be submitted to EPA within 60 daysof the change.

(k) Persons who purchase andsubsequently destroy controlled class Isubstances shall provide the producer orimporter from whom they purchasecontrolled substances to be destroyedwith a verification that controlledsubstances will be used in processesthat result in their destruction.

(1) The verification shall include thefollowing:

(i) Identity and address of the personintending to destroy controlledsubstances;

(ii) Indication of whether thosecontrolled substances will becompletely destroyed, as defined in§'82.3, or less than completelydestroyed, in which case the destructionefficiency at which such substances willbe destroyed must be included;

(iii) Period of time over which theperson intends to destroy controlledsubstances; and


(iv) Signature of the verifying person.

(2) If, at any time, any aspects of thisverification change, the person mustsubmit a revised verification reflectingsuch changes to the producer fromwhom that person purchases controlledsubstances intended for destruction.

(1) Persons who purchase class Icontrolled substances and whosubsequently transform such controlledsubstances shall provide the producer orimporter with the IRS certification thatthe controlled substances are to be usedin processes resulting in theirtransformation.

(m) Any person who transforms ordestroys class I controlled substancesmust report the names and quantities ofclass I controlled substancestransformed and destroyed for eachcontrol period within 45 days of the endof such control period.

(n) Every person who produces,imports, or exports class II chemicalsmust report its quarterly level ofproduction, imports, and exports ofthese chemicals within 45 days of theend of each quarter.

(o) Persons who import or export usedor recycled controlled substances mustlabel their bill of lading or invoice

indicating that the controlled substanceis used or recycled.

(p) Every person who imports orexports used or recycled group II, classI controlled substances, or class IIcontrolled substances must report itsannual level within 45 days of the endof the control period.

(q) Every person who transships acontrolled substance must maintainrecords that indicate that the controlledsubstance shipment originated in onecountry destined for another country,and does not enter interstate commercewith the United States.

Appendix A to Subpart A-Class 1 Controlled Substances

ODP

A. Group 1:CFC-1 3-Tdchlorofluoromethane

(CFC-11)............................................................................1.0CF2CI2-Dlchlorodifluoromethane

(CFC--12) ........................................................................................................................................................................ 1.0C2F3C13-Tdichlorotrifluoroethane

(CFC-1 )13) ....................................................................................................... ............................................................... 0.8C2F4C1 2-Dichlorotetrafluoroethane(VFC-1 14) 1.0C2F5C1 -Monochloropentaf luoroethane

(CF -1 .15) ....................................................................................................................................................................... 0.6C2F5C1-MonochloropentafluoroethaneAll isomers of the above chemicals

B. Group II:CF2C1 Br-Bromochlorodifluoromethane

(Halon-1211) ................................................................................................................................................................... 3.0CF3Br-Bromotnfluoromethane

(Halon-1301) ................................................................................................................................................................... 10.0C2F4Br-DIbromotetrafluoroethane

(Halon-2402) ................................................................................................................................................................... 6.0All Isomers of the above chemicals

C. Group II:CF3Cl-Chlorotrifluoromethane

(CFC-13) ......................................................................................................................................................................... 1.0C 2FCls-

(CFC-1 11) ........................................................................................................................................................................ 1.0C2F2C14-

(CFC- 12) ........................................................................................................................................................................ 1.0C3FC1l-(CFC-211) ....................................................................................................................................................................... 1.0

C3F2CI6-(CFC-212) ....................................................................................................................................................................... 1.0

C3F3C15-(CFC-213) ....................................................................................................................................................................... 1.0

C3F4C14-(CFC-214) ....................................................................................................................................................................... 1.0

C3F5C13-(CFC-215) ....................................................................................................................................................................... 1.0

C3F6C12-(CFC-216) ....................................................................................................................................................................... 1.0

C3F7C1-(CFC-217) ...................................................................................................................................... ; ................................ 1.0

All isomers of the above chemicalsD. Group IV:

CC14-Carbon Tetrachloridde .................................................................................................................................................... 1.1E. Group V:

C2H3C13-1,,11 Tnchloroethane.(Methyl chloroform ) ......................................................................................................................................................... u.

All isomers of the above chemical except 1,I,2-tdchloromethaneF. Group VI:

CH3Br-Bromomethane(Methyl Brom ide) .................................................................................................... : ....................................................... 0.7

G. Gioup VII:

Federal Register I Vol. 58, No. 236 I Friday, December 10, 1993 / Rules and Regulations 65075

ODP

CHFBR2 ...............................................................................................................................................................................CHF2Br (HBFC-22B1) ......................... ............ ;...............................................:............. .................................................

CH2FBr ..........................................................................................................................................C2HFBr4 .................................................................................................................................................................................

C2HF2Br3 ..............................................................................................................................................................................C2HF3Br2 ................................................................................................................................................................................C2HF4Br .................................................................................................................................................................................C2H2FBr3 .......................................... ...................................................................................................................................C2H2F2Br2 ..................... ..... ...... .. .... . . ..C2H2F3Br ................................................................................................................................................................................C2H3FBr2 ................................................................................................................................................................................C2H3F2Br ................................................................................................................................................................................C2H4FBr ...................................................................................................................................................................................C3HFBr6 ..................................................................................................................................................................................C3HF2Br5 ................................................................................................................................................................................C3 HF3Br4 ................................................................................................................................................................................ .C3HF4Br3 ................................................................................................................................................................................C3 HF5Br2 ................................................................................................................................................................................C3HF6Br ..................................................................................................................................................................................C3H2FBR . ...............................................................................................................................................................................C3H2F2BR4 ................................................................................................................................... ; .................... * ...................C3H2F3Br3 .............................................................................................................................................................................. .C3H2F4Br2 ..............................................................................................................................................................................C3H2FSBR ...............................................................................................................................................................................C3 H3FBR4 ...............................................................................................................................................................................C3H3F2Br3 ...............................................................................................................................................................................C3H3F3Br2 ..............................................................................................................................................................................C3H3F4Br ........................................................................................................................................................... ; ....................C3H4FBr3 ................................................................................................................................................................................C3H4F2B r2 ..............................................................................................................................................................................C3H4F3Br ...............................................................................................................................................................................C3 H5FBr2 .............................................................................................................................................................................. ...C3H F2Br ...............................................................................................................................................................................C3H .FB ...................................................................................................................................................................................

1.000.740.73

0.3-0.80.5-1.80.4-1.60.7-1.20.1-1.10.2-1.50.7-1.60.1-1.70.2-1.1

0.07-0.10.3-1.50.2-1.90.3-1.80.5-2.20.9-2.00.7-3.30.1-1.90.2-2.10.2-5.60.3-7.50.9-1.4

0.08-1.90.1-3.10.1-2.50.3-4.4

0.03-0.30.1-1.0

0.07-0.80.04-0.40.07-0.80.02-0.7

Appendix B to Subpart A-Class II Controlled Substances

ODP

CHFC1 2-Dlchlorofiuoromethane(HCFC-21) .............................................................................................................................................................................

CHF2C1-Chlorodifluoromethane(HCFC-22)..........................................................................

CH2FC1-Chlorofluoromethane(HCFC-31) .............................................................................................................................................................................

C2HFC14-(HCFC-121) ...........................................................................................................................................................................

C2HF2C1 3-(HCFC-122) ............................................................................................................................................................... t .........

C2HF3CIr.(HCFC-123) ...........................................................................................................................................................................

C2HF4C1-(HCFC-124) ..........................................................................................................................................................................

C2H2FC13-(HCFC--131) ..........................................................................................................................................................................

C2H2F2C1r(HCFC-132b) .................................................................................................................. ; ......................................................

C2 H2 F3C1-(HCFC-133a) .........................................................................................................................................................................

C2H3FC12-(HCFC-141b) .....................................................................................................................................................................

C2H3F 2C1-(HCFC-142b)....................................

C3HFC16-(HCFC-221) ..........................................................................................................................................................................

C3HF 2C1s-(HCFC-222) ...........................................................................................................................................................................

C3HF 3CI 4-(HCFC-223) .........................................................................................................................................................................

C3HF 4C1-(HCFC-224) ..........................................................................................................................................................................

C3HFCl r(HCFC-225ca) .......................................................................................................................................................................

[res.]

0.05

[res.]

[res.]

0.02

0.02

[res.]

[res.]

[res.]

0.12

0.06

[res.]

[res.]

(res.]

[res.]

[res.]


ODP

C3HF 5C1 2(HCFC-225cb) ....................................................................................................................................................................... [res.]

C3HFC1-(HCFC-226) ........................................................................................................................................................................... [res.]

C3H2FC13-(HCFC-231) ......................................................................................................................................................... .................. [res.]

C3H2F2C14-(HCFC-232) ........................................................................................................................................................................... [res.]

C3H2F3C13-(HCFC-233) ........................................................................................................................................................................... [res.]

C3H2F4C1 2-(HCFC-234) ........................................................................................................................................................................... [res.]

C3H2F5C1-(HCFC-235) ........................................................................................................................................................................... [res.]

C3H3FC14-(HCFC-241) ........................................................................................................................................................................... [res.]

C3H 3F2C13-(HCFC-242) ........................................................................................................................................................................... [res.]

C3H3F3C1-(H FC-243) .......................................................................................................................................................................... . [res.]

C3H3F4CI-(HCFC-244)....................................................................................[res.]

C3H4FC13-(HCFC-251). .......................................................................................................................................................................... . [res.]

C3H4F2C 12-(HCFC-252) ........................................................................................................................................................................... [res.]

C3H4F3C1-(HCFC-253)....................................................................................[res.]

C3HFC12 -(HCFC-261) ........................................................................................................................................................................... [res.]

C3H3F 2C1-(HCFC-262) .......................................................................................................................................................................... [res.]

C3H6FC1-(HCFC-271) ........................................................................................................................................................................... [res.]

All Isomers of the above chemicals

Appendix C to Subpart A-Annex 1-Parties to the Montreal Protocol:

London Copenha-Montreal amend- genForeign state protocol ments amend-ments ments

Algeria ........................................................................................................................................................... V' VAntigua and Barbuda .................................................................................................................................... V V, VArgentina ....................................................................................................................................................... V VOAustralia ........................................................................................................................................................ V VAustria ........................................................................................................................................................... V beBaham as ....................................................................................................................................................... V V V,Bahrain .......................................................................................................................................................... VVBangladesh ................................................................................................................................................... VBa rbados ....................................................................................................................................................... VBelarus .......................................................................................................................................................... VBelgium ........................................................................................................................................................ I VBenin ............................................................................................................................................................. VBosnia and Herzegovina ............................................................................................................................... VBo tswana ...................................................................................................................................................... VBrazil ............................................................................................................................................................. VBum el ............................................................................................................................................................Bulgaria ......................................................................................................................................................... VBurkina Faso .................................................................................................................................................Cam eroon ............................................................................................................................................. V ....... V'.Canada .......................................................................................................................................................... V VCentral African Republic ............................................................................................................................... VChile ...............................................................................................................................................................China ............................................................................................................................................................. VCosta Rica ....................................................................................................................................................Cote Ivolre .......................................Croatia .......................................................................................... ..Cuba .................................................................................................. VCyprus ................................................................................................Czech Republic .......................................................................... VDenmark ....................................................................................... VDominica ............................................................................................. ..................................................... V


London gopenha-Foreign state Montreal amend- amend

protocol ments amend-

Dominican Republic ...................................................................................................................................... VEcuador ......................................................................................................................................................... V VEgypt ............................................................................................................................................................. V VEl Salvador ...................................................................................................................................................VEuropean E.C ............................................................................................................................................... V beFifi ... .................................. .......... .. .......................................................... .....................................................VFinland .................. ,..................................................................................... . ...... I -

France ... ........................................................................................................................................................ Ve VGam bia ................................... .................................................. VGermany ....................................................................................................................................................... V =4Ghana ........................................................................................................................................................... V WGreece ........................................................................................................................................................... V6 VGrenada ............................................................................................................ VGuatemala .................................................................................................................................................... VGuinea .......................................................................................................................................................... V VHungary ......................................................................................................................................................... V'Iceland ........................................................................................................................................................... VIndia .............................................................................................................................................................. V V,Indonesia ....................................................................................................................................................... we VIran ............................................................................................................................................................... . VIreland ........................................................................................................................................................... eVIsrael ............................................................................................................................................................. V VItaly ................................................................................................................................................................ . V VJamaica ............................ ; ........................................................................................................................... V =4 =4Japan ............................................................................................................................................................ V VJordan ........................................................................................................................................................... V0Kenya. ............................................................... VKiribati ........................................................................................................................................................... VKorea, Republic of ........................................................................................................................................ V VKuwait ........................................................................................................................................................... VLebanon ................................................................................. ; ...................................................................... V VeLibya .............................................................................................................................................................. WUechtenstein ................................................................................................................................................. VLuxembourg ........................................... ...................................................................................................... . VMalawi ........................................................................................................................................................... VMalaysia ....................................................................................................................................................... V VMaldives ........................................................................................................................................................ V, VMalta ............................................................................................................................................................. VMarshall Islands ............................................................................................................................................ VMauritius ........................................................................................................................................................ V VMexico ............................................................................................................................................................ V VMonaco ........................................................................................................................................................ VNam ibia ............................................................................................................. .......................................... VNetherlands .................................................................................................................................................. V VNew Zealand ................................................................................................................................................ V V VNicaragua ...................................................................................................................................................... V .Niger .................................................................Nigeria ........................................................................................................................................................... VNorway ........................................................................................................................................................... VV VPakistan ........................................................................................................................................................ OV VPanama ......................................................................................................................................................... V1Papua New Guinea ........................................................................................................................................ VVParagua y ........................................................................................................................................................ VPeru ...............................................................................................................................................................Philippines ...................................................................................................................................... : ............. . VPoland ...........................................................................................................................................................Portugal ......................................................................................................................................................... V0Romania ................................................................................................................. V.......................................Russian Federation .......................................................................................................................................Saint Kitts and Nevia .................................................................................................................................... WSamoa ............................................................................................................................................................ VSaudi Arabia ... .......... ............................................... V VSenegal .......................................................................................................................................................... V1Seychelles ..................... ........................... ............................................. 0. VSingapore .................................................................... VSlovenia ....................................................................... VSolomon Islands ........................................................... VSouth Africa ..................................................................Spain .............. .................................................. .V VSr Lanka ......................................................................Sudan .............................................................................................................................................................


London Copenha-Foreign state Mont amend- gen

protocol ments amend-ments

Swaziland ................................................. .VSweden ........................................................................................................................................................V V VSwitzerland .................................................................................................................................................... V V,Syrian Arab Republic .................................................................................................................................... VTanzania .... ................................................................................................................................................... V VThailan d ........................................................................................................................................................ V VTogo .............................................................................................................................................................. VTrinidad and Tobago ..................................................................... VTunisia ........................................................................................................................................................... VTurkey ............................................................................ ! .............................................................................. VTuvalu ................................................................ VUganda .......................................................................................................................................................... V,Ukran ian SSR ............................................................................................................................................... VUnited Arab Em irates .................................................................................................................................... V'United Kingdom ............................................................................................................................................ b V,United States ................................................................................................................................................ 6e v'Uruguay ......................................................................................................................................................... VUzbeidstan .................................................................................................................................................... VVenezuela ..................................................................................................................................................... oVZam bia .......................................................................................................................................................... VZimbabwe ...................................................................................................................................................... V

Appendix C to Subpart A, 1-Annex 2-Nations Complying With, but notParties to, the Protocol: Colombia

Appendix D to Subpart A--HarmonizedTariff Schedule

Description of Products that May ContainControlled Substances in Appendix A. ClassI Groups I and i

This Appendix is based on informationprovided by the Ozone Secretariat of theUnited Nations Ozone EnvironmentProgramme. The Appendix lists availableU.S. harmonized tariff schedule codesidentifying headings and subheadings forAnnex D products that may containcontrolled substances.

The Harmonized Tariff Schedule of theUnited States uses a enumeration system toidentify products imported and exported toand from the U.S. This system relies on afour digit heading, a four digit subheadingand additional two digit statistical suffix tocharacterize products. The United States usesthe suffix for its own statistical records andanalyses. This Appendix lists only headingsand subheadings.

While some can be readily associated withharmonized system codes, many productscannot be tied to HS classifications unlesstheir exact composition and the presentationare known. It should be noted that thespecified HS classifications represent themost likely headings and subheadings whichmay contain substances controlled by theMontreal Protocol. The codes given shouldonly be used as a starting point; fiurtherverification is needed to ascertain whether ornot the products actually contain controlledsubstances.

I Regarding Taiwan, see preamble discussion VI(Trade Restrictions)

Category 1. Automobile and Truck AirConditioning Units-4 WhetherIncorporated in Vehicles or Not)

There are no separate code numbersfor air conditioning units specially usedin automobiles and trucks. Although acode has been proposed for car airconditioners, it is not yet officiallylisted in the Harmonized TariffSchedule (see category 2). The followingcodes apply to the vehicles potentiallycontaining air conditioning units.

Heading/Subheading and ArticleDescription

8701.(10, 20, 30, 90)2 -- Tractors8702-Public-transport type passenger

motor vehicles.8702.10-With compression-ignition

internal-combustion piston engine(diesel or semi-diesel).

8702.90-Other.8703-Motor cars and other motor

vehicles principally designed for thetransport of persons (other than thoseof heading 8702). including stationwagons and racing cars.

8703.10-Vehicles specially designedfor traveling on snow; golf carts andsimilar vehicles; includes subheading10.10 and 10.50.

8703.(21, 22, 23, 24)-Other vehicles,with spark-ignition internalcombustion reciprocating engines.

8703.(31, 32, 33, 90)--Other vehicles,with compression-ignition internal

I At this time vehicle air conditioning units areconsidered components of vehicles or are classifiedunder the general category for air conditioning andrefrigeration equipment. Vehicles containing airconditioners are therefore considered productscontaining controlled substances.

combustion piston engine (diesel orsemi-diesel).

8704-Motor vehicles for the transportof goods.

8704.10.(10. 50)-Dumpers designed foroff-highway use.

8704.(21, 22, 23)-Other, withcompression-ignition internalcombustion piston engine (diesel orsemi-diesel).

8704.(31, 32, 90)-Other, withcompression-ignition internalcombustion piston engine.

8705-Special purpose motor vehicles,other than those principally designedfor the transport of persons or goods(for example, wreckers, mobile cranes,fire fighting vehicles, concrete mixers,road sweepers, spraying vehicles,mobile workshops, mobileradiological units).

8705.10--Crane lorries.8705.20-Mobile drilling derricks.8705.30-Fire fighting vehicles.8705.90-Other.

Category 2. Domestic and CommercialRefrigeration and Air Conditioning/Heat Pump Equipment

Domestic and commercial airconditioning and refrigerationequipment fall primarily underheadings 8415 and 8418.Heading/Subheading and ArticleDescription

8415-Air conditioning machines,comprising a motor-9rven fan andelements for changing the temperatureand humidity, including thosemachines in which the humiditycannot be separately regulated.


8415.20-Proposed code for airconditioning of a kind used forpersons, in motor vehicles.

8415.10.00-A/C window or wall types,self-contained.

8415.81.00-Other, except parts,incorporating a refrigerating unit anda valve for reversal of the cooling/heatcycle.

8415.82.00-Other, incorporating arefrigerating unit; Self-containedmachines and remote condenser typeair conditioners (not for year-rounduse); Year-round units (for heatingand cooling); Air Conditioningevaporator coils; Dehumidifiers; andother air conditioning machinesincorporating a refrigerating unit.

8415.83-Automotive air conditioners.8418-Refrigerators, freezers and other

refrigerating or freezing equipment,electric or other: heat pumps, otherthan air conditioning machines ofheading 8415;,parts thereof.

8418.10.00--Combined refrigerator-freezers, fitted with separate externaldoors.

8418.21.00-Refrigerators, householdtype, compression type.

8418.22.00-Absorption type, electrical.8418.29.00--Other.8418.30.00-Freezers of the chest type.8418.40-Freezers of the upright type.8418.50.0040--Other refrigerating or

freezing chests, cabinets, displaycounters, showcases and similarrefrigerating or freezing furniture.

8418.61.00-Other refrigerating orfreezing equipment; heat pumps.

8418.69--Other Icemaking machines;drinking water coolers, self-contained;soda fountain and beer dispensingequipment; centrifugal liquid chillingrefrigerating units; absorption liquidchilling units; reciprocating liquidchilling units: and other refrigeratingor freezing equipment (household orother).

8479.89.10-Dehumidifiers (other thanthose under 8415 or 8424 classified as"machines and mechanicalappliances having individualfunctions, not specified or includedelsewhere").

Category 3. Aerosol ProductsAn array of different products use

controlled substances as aerosols and inaerosol applications. Not all aerosolapplications use controlled substances,however. The codes given belowrepresent the most likely classificationsfor products containing controlledsubstances. The product codes listedinclude:3

3 Other categories of products that may containcontrolled substances are listed below. EPA iscurrently working to match them with appropriate

* Varnishes." Perfumes."* Preparations for use on hair.* Preparations for oral and dental

hygiene." Shaving preparations." Personal deodorants, bath

preparations." Prepared room deodorizers." Soaps.* Lubricants." Polishes and creams.. Explosives.* Insecticides, fungicides, herbicides,

disinfectants,* Arms and ammunition.* Household products such as

footwear or leather polishes.* Other miscellaneous products.

Heading/Subheading and ArticleDescription3208-Paints and varnishes 4 (including

enamels and lacquers) based onsynthetic polymers of chemicallymodified natural polymers, dispersedor dissolved in a non-aqueousmedium.

3208.10-Based on polyesters.3208.20-Based on acrylic or vinyl

polymers.3208.90--Other.3209-Paints and varnishes (including

enamels and lacquers) based onsynthetic polymers or chemicallymodified natural polymers, dispersedor dissolved in a an aqueous medium.

3209.10-Based on acrylic or vinylpolymers.

3209.90--Other.3210.00--Other paints and varnishes

(including enamels, lacquers anddistempers) and prepared waterpigments of a kind used for finishingleather.

3212.90-Dyes and other coloringmatter put up in forms or packings forretail sale.

3303.00-Perfumes and toilet waters.3304.30-Manicure or pedicure

preparations.3305.10-Shampoos.3305.20-Preparations for permanent

waving or straightening.3305.30-Hair lacquers.

codes. They include: coatings and electronicequipment (e.g., electrical motors), coatings orcleaning fluids for aircraft maintenance, moldrelease agents (e.g. for production of plastic orelastomeric materials), water and oil repellant(potentially under HS 3402), spray undercoats(potentially under "paints and varnishes"), spotremovers, brake cleaners, safety sprays (e.g., macecans), animal repellant, noise horns (e.g., for use onboats), weld inspection developers, freezants, gumremovers, intruder alarms, tire inflators, dusters (forelectronic and non-electronic applications), sprayshoe polish, and suede protectors.

4 Although paints do not generally use containcontrolled substances, some varnishes use CFC 113and 1,1,1, trichlorethane as solvents.

3305.90--Other hair preparations.3306.10--Dentrifices.3306.90--Other dental (this may

include breath sprays).3307.10-Pre-shave, shaving or

aftershave preparations.3307.20-Personal deodorants and

antiperspirants.3307.30-Perfumed bath salts and other

bath preparations.3307.49 Other (this may include

preparations for perfuming ordeodorizing rooms, includingodoriferous preparations used duringreligious rites, whether or notperfumed or having disinfectantproperties).

3307.90--Other (this may includedepilatory products and otherperfumery, cosmetic or toiletpreparations, not elsewhere specifiedor included).

3403-Lubricating preparations(including cuttingoil preparations,bolt or nut release preparations, anti-rust or anti-corrosion preparationsand mould release preparations, basedon lubricants), and preparations of akind used for the oil or greasetreatment of textile materials, leather,fur skins or other materials, butexcluding preparations containing, asbasic constituents, 70 percent or moreby weight of petroleum oils or of oilsobtained from bituminous minerals.

3402--Organic surface-active agents(other than soap); surface-activepreparations, washing preparationsand cleaning operations, whether ornot containing soap, other than thoseof 3401.

3402.20-Preparations put up for retailsale.

3402.19--Other preparations containingpetroleum oils or oils obtained frombituminous minerals.

3403-Lubricating preparationsconsisting of mixtures containingsilicone greases or oils, as the case'may be.

2710.00-Preparations not elsewherespecified or included, containing byweight 70 percent or more ofpetroleum oils or of oils obtainedfrom bituminous minerals, these oilsbeing the basic constituents of thepreparations.

3403.11-Lubricants containingpetroleum oils or oils obtained frombituminous minerals used forpreparations from the treatment oftextile materials, leather, fur skins orother materials.

3403.19--Other preparations containingpetroleum oils or oils obtained frombituminous minerals.

3405-Polishes and creams, forfootwear, furniture, floors, coachwork,glass or metal, scouring pastes and


powders and similar preparationsexcluding waxes of heading 3404.

3405.10-Polishes and creams forfootwear or leather.

3405.20-Polishes for wooden furniture,floors or other woodwork.

36-Explosives.3808-Insecticides, rodenticides,

fungicides, herbicides, anti-sproutingproducts and plant-growth regulators,disinfectants and similar products,put up in forms or packings for retailsale or as preparations or articles (forexample, sulphur-treated bands,wicks and candles, and fly papers).

3808.10-Insecticides.3808.20-Fungicides.3808.30-Herbicides, anti-sprouting

products and plant growth regulators.3808.40-Disinfectants.3808.90--Other insecticides, fungicides.3809.10-Finishing agents, dye carriers

to accelerate the dyeing or fixing ofdye-stuffs and other products andpreparations (for example, dressingsand mordants) of a kind used in thetextile, paper, leather or likeindustries, not elsewhere specified orincluded, with a basis of amylaceoussubstances.

3814-Organic composite solvents andthinners (not elsewhere specified orincluded) and the prepared paint orvarnish removers.

3910-Silicones in primary forms.9304-Other arms (for example, spring,

air or gas guns and pistols,truncheons), excluding those ofheading No. 93.07. Thus, aerosolspray cans containing tear gas may beclassified under this subheading.

0404.90-Products consisting of naturalmilk constituents, whether or notcontaining added sugar or othersweetening matter, not elsewherespecified or included.

1517.90-Edible mixtures orpreparations of animal or vegetablefats or oils or of fractions of differentfats or oils of this chapter, other thanedible fats or oils or their fractions ofheading No. 15.16.

2106.90-Food preparations notelsewhere specified or included.

Category 4. Portable Fire Extinguishers


8424-Mechanical appliances (whetheror not hand operated) for projecting,dispersing, or spraying liquids orpowders; fire extinguishers whetheror not charged, spray guns and similarappliances; steam or sand blastingmachines and similar jet projectingmachines.

8424.10-Fire extinguishers, whether ornot charged.

Category 5. Insulation Boards, Panelsand Pipe Covers

These goods have to be classifiedaccording to their composition andpresentation. For example, if theinsulation materials are made ofpolyurethane, polystyrene, polyolefinand phenolic plastics, then they may beclassified Chapter 39, for "Plastics andarticles thereof". The exact descriptionof the products at issue is necessarybefore a classification can be given.5


3917.21 to 3917.39-Tubes, pipes andhoses of plastics.

3920.10 to 3920.99-Plates, sheets, film,foil and strip made of plastics,noncellular and not reinforced,laminated, supported or similarlycombine with other materials.

3921.11 to 3921.90-Other plates,sheets, film, foil and strip, made ofplastics.

3925.90-Builders' ware made ofplastics, not elsewhere specified orincluded.

3926.90-Articles made of plastics, notelsewhere specified or included.

Category 6. Pre-Polymers

According to the Explanatory Notes tothe Harmonized Commodity Descriptionand Coding System, "prepolymers are

products which are characterized bysome repetition of monomer unitsalthough they may contain unreactedmonomers. Prepolymers are notnormally used as such but are intendedto be transformed into higher molecularweight polymers by furtherpolymerization. Therefore the term doesnot cover finished products, such as di-isobutylenes or mixed polyethyleneglycols with very low molecular weight.Examples are epoxides based withepichlorohydrin, and polymericisocyanates."


3901-Pre-polymers based on ethylene(in primary forms).

3902-Pre-polymers based on propyleneor other olefins (in primary forms).

3903, 3907, 3909-Pre-polymers basedon styrene (in primary forms),epoxide and phenols.

Appendix E to Subpart A-Article 5Parties

Algeria, Antigua and Barbuda.Argentina, Bahrain, Bangladesh,Barbados, Benin, Botswana, Brazil,Burkina Faso, Cameroon, CentralAfrican Republic, Chile, China, CostaRica, Cote Ivoire, Croatia, Cuba;Cyprus,Dominica, Dominican Republic,Ecuador, Egypt, El Salvador, Fiji,Gambia, Ghana, Grenada. Guatemala,Guinea, India, Indonesia, Iran, Jamaica,Jordan, Kenya, Kiribati, Lebanon, Libya.'Malawi, Malasia, Maldives, MarshallIslands, Mauritius, Mexico, Namibia,Nicaragua, Niger, Nigeria, Pakistan,Panama, Papua New Guinea, Paraguay,Peru, Philippines, Romania, Saint Kittsand Nevis, Samoa, Senegal, Seychelles,Slovenia, Sri Lanka, Sudan, Swaziland,Syrian Arab Republic, Tanzania,Thailand, Togo, Trinidad and Tobago,Tunisia, Turkey, Tuvalu, Uganda,Uruguay, Venezuela, Zambia,Zimbabwe.

Appendix F to Subpart A-Listing of Ozone Depleting Chemicals

Controlled substance 3ODP AT L CLP BLP

A. Class I 1. Group 1:CFCl 3 -Trlchlorofluoromethane (CFC-11) ..............................................................CF2C12-Dichlorodifluoromethane (CFC-12) ...........................................................C2F3C1 3-Tdchlorotdfluoroethane (CFC-1 13) .........................................................C2F4C1 -Dichlorotetrafluoroethane (CFC-1 14) ......................................................C2F5-C1 Monochloropentafluoroethane (CFC-1 15) ................................................

All isomers of the above chemicals [reserved]2. Group I:

CF2 C1 Br-Bromochlorodifluoromethane (Halon-1 211) ...........................................

5 This category may include insulating board for refrigerators, freezers, beverage vending machines,building panels and windows and doors. It also bulk beverage dispensers, water coolers and heatersincludes rigid appliance insulation for pipes, tanks, and ice machines.trucks, trailers, containers, train cars & ships,

60.0120.090.0

200.00400.0


Controlled substance ODP AT L CLP BLP

-18 -. 08 -. 03.CF3 Br-Bromotrifluoromethane (Halon-1301) ......................................................... 10.0 72 0.00 1.00

-107 ....... ............................C2F4 Br2 Dibrom otetrafluoroethane (Halon-2402) .................................................. 6.0 23 0.00 0.30

- 28 .................... - .37 ....................All Isomers of the above chemicals [reserved]3. Group III:

CF3C1-Chlorotdfluoromethane (CFC-13) .............................................................. 1.0 120 0.88 0.00-250 -1.83 .........................

C2FC1s-(CFC-111) ................................................................................................. 1.0 60 1.04 0.00-90 -1.56 .........................

C2F2C14-(CFC-112) ............................................................................................... 1.0 60 0.90 0.00-90 -1.35 .........................

C3FCl--(CFC-211) ................................................................................................. 1.0 100 1.76 0.00-500 - 8.81 .................... .....................

C3F2C16-(CFC-212) ............................................................................................... 1.0 100 1.60 0.00-500 -7.98 .........................

C3F3C 13-(CFC-213) .............................................. : ................................................ 1.0 100 1.41 0.00-500 -7.06 ................. ........

C3F4C 14-(CFC-214) ............................................................................................... 1.0 100 1.20 0.00-500 -6.01 .................... ....................

C3FsC1 3-(CFC-215) ............................................................................................... 1.0 100 0.96 0.00-500 -4.82 .........................

C3F6C12-(CFC-216) ............................................................................................... 1.0 100 0.69 0.00-500 -3.45 .........................

C3F7C1-(CFC-217) ................................................................................................. 1.0 100 0.37 0.00-500 -1.87 .........................

All Isomers of the above chemicals [reserved]4. Group IV:

CC14-Carbon Tetrachloride ............................................................... ; .................... 1.1 50.0 1.0 0.005. Group V:

C2H3C13-1,1,1 Trichloroethane (Methyl chloroform) .............................................. 0.1 6.3 0.11 0.00All isomers of the above chemical except 1,1,2-trlchloroethane [reserved]6. Group VI:

CH3Br-Bromom ethane (Methyl Bromide) ............................................................... 0.7 .................... [reserved] ....................7. Group VII:

CHFBR1-. ................................................................................................................. 1.00 .................... [reserved] ....................CHF2Br(HBFC-22B1) .............................................................................................. 0.74 .................... [reserved] ....................CH2FBr .................................................................................................................... 0.73 .................... [reserved] ....................C2HFBr4 .................................................................................................................. 0.3 - 0.8 .................... [reserved] ....................C2HF2Br3 .................................................................................................................. 0.5 - 1.8 .................... [reserved] ....................C2HF3Br2 ................................................................................................................. 0.4 - 1.6 .................... [reserved] ....................C2HF4Br ............................................................................................................. e... 0.7 - 1.2 .................... [reserved] ....................C2H2FBr3 ................................................................................................................. 0.1 - 1.1 .................... [reserved] ....................C2H2F2Br2 ................................................................................................................ 0.2 - 1.5 .................... [reserved] ....................C2H2F3Br .................................................................................................................. 0.7 - 1.6 .................... [reserved] ....................C2H3FBr2 .................................................................................................................. 0.1 - 1.7 .................... [reserved] ....................C2H3F2Br .................................................................................................................. 0.2 - 1.1 .................... [reserved] ....................C2H4 Br .................................................................................................................... 0.07 - 0.1 .................... [reserved] ....................C3HFBr6 ................................................................................................................... 0.3 - 1.5 .................... [reserved] ....................C3HF2Br5 .................................................................................................................. 0.2 - 1.9 .................... [reserved] ....................C3HF3Br4 .................................................................................................................. 0.3 - 1.8 .................... [reserved] ....................C3HF4Br3 .................................................................................................................. 0.5 - 2.2 .................... [reserved] ....................C3HF5Br2 .................................................................................................................. 0.9 - 2.0 .................... [reserved] ....................C3HF6Br ................................................................................................................... 0.7 - 3.3 .................... [reserved] ....................C3H 2FBRs ............................................................................................................... 0.1 - 1.9 .................... [reserved] ....................C3H2F2BR4 ............................................................................................................... 0.2 - 2.1 .................... [reserved] ....................C3H2F3Br3 ................................................................................................................ 0.2 - 5.6 .................... [reserved] ....................C3H2F4Br2 .................................................. ............................................................. 0.3 - 7.5 .................... [reserved] ....................C3H2F5BR ................................................................................................................ 0.9 - 1.4 .................... [reserved] ....................C3H3FBR4 ................................................................................................................ 0.08 - 1.9 .................... [reserved] ....................C3H3F2Br3 ................................................................................................................ 0.1 - 3.1 .................... [reserved] ....................C3H3F3Br2 ................................................................................................................ 0.1 - 2.5 .................... [reserved] ....................C3H3F4Br .................................................................................................................. 0.3 - 4.4 .................... [reserved] ....................C3H4FBr3 ................. ; ................................................................................................ 0.03 - 0.3 .................... [reserved] ....................C3H4F2Br2 ................................................................................................................ 0.1 - 1.0 .................... [reserved] ....................C3H4F3Br .................................................................................................................. 0.07 - 0.8 .................... [reserved] ....................C3H5FBr2 .................................................................................................................. 0.04 - 0.4 .................... [reserved] ....................C3H BF2Br ............................. ; .................................................................................... 0.07 - 0.8 .................... [reserved] ....................C3H6FB .................................................................................................................... 0.02 - 0.7 .................... [reserved] ....................

B. Class II:CHFC1 2-DiChlorofluorom ethane (HCFC-21) ......................................................... [res.] 2.1 0.03 0.00CHF 2C I-Chlorodfluoromethane (HCFC-22) ......................................................... 0.05 15.3 0.14 0.00CH2FC 1-Chlorofluoromethane (HCFC-31) ............................................................ [res.] 1.44 0.02 0.00


Controlled substance ODP AT L CLP BLP

C2HFC I4--(HCFC-121) ........................................................................................... [res.] 0.6 0.01 0.00C2HF2C1H (HCFC -122) .......................................................................................... [res.] 1.4 0.02 0.00C2HF3C 12 -(HCFC-123) .......................................................................................... 0.02 1.6 0.016 0.00C2HF4C1-(HCFC-124) ............................................... 0.02 6.6 0.04 0.00C2H2FC 1y -(HCFC-131) .......................................................................................... [res.] 4.0 ,0.06 0.00C2H2F2C 12-(HCFC-132b) ...................................................................................... [res.] 4.2 '0.05 0.00C2H2F3C -(HCFC-133a) ........................................................................................ [res.] 4.8 0.03 0.00C2H3FC1 2-(HCFC-141b) ........................................................................................ 0.12 10.0 0.10 0.00C2H3F2C 1-(HCFC-142b) ........................................................................................ 0.06 19.1 0.14 0.00C3HFC1 d(HCFC-221) ............................................................................................ [reserved] ..................... .................... 0.00C3H F2C 1 -(HHCFC-222) .......................................................................................... [reserved] ..................... .................... 0.00C3HF3C 14-(HCFC-223) .......................................................................................... [reserved] ..................... ................... . 0.00C3H F4C 13-(HCFC-224) ........................................................................................ [reserv ed] ..................... .................... 0.00C3H FsCI 2-(HCFC-225ca) ...................................................................................... [res.] 1.5 0.01 0.00

-1 .7 .................... .................... ....................(HCFC-225Cb) ................................................................................................. [r s.] 5.1 0.04 0.00

C3HF C 1--(HCFC-226) ............................................................................................ [reserved] ..................... .................... 0.00C3H2FC 15-(HCFC-231) .......................................................................................... [reserv ed] ..................... ................... . 0.00C3H2F2C 14-(HCFC-232) ......................................................................................... [reserved] ............................ 0.00C3H2F3C 13-(HCFC-233) ......................................................................................... [reserved] . .................... ................... . 0.00C3H2F4C 1 --(HCFC-234) ........................................................................................ [reserved] ..................... .................... 0.00C3H2FsCl-(HCFC--235) .......................................................................................... [reserved] .................... .................... 0.00C3H3FC14-(HCFC-241) .......................................................................................... [reserved] ..................... .................... 0.00C3H3F2C 13-(HCFC--242) ......................................................................................... [reserved] ..................... .................... 0.00C3H3F3C1 2-(HCFC-243) ......................................................................................... [reserved] ..................... ................... . 0.00C3H3F4C 1-(HCFC-244) .......................................................................................... [reserved] ..................... .................... 0.00C3H4FC 13-(HCFC-251) .......................................................................................... [reserved] ..................... .................... 0.00C3H4F2C1 -(HCFC -252) ......................................................................................... [reserved] ..................... ................... . 0.00C3H4F3C1-(HCFC-253) .......................................................................................... [re serv ed] ............................ 0.00C3HsFC 12-(HCFC-261) ......................................................................................... [reserv ed] ..................... .................... 0.00C2H sF2C1-(HCFC-262) .......................................................................................... [reserv ed] ..................... .................... 0.00C3H6FC 1-(HCFC-271) ............................................................................................ [reserved] .................... ..................... 0.00

All Isomers of the above chemicals [reserved]

[FR Doc. 93-29886 Filed 12-3-93; 4:29 pm]BILUNG CODE 6560.60-P

Friday1! December 10, 1993

B

U I

II

Part III

Department ofTransportationFederal Highway Administration

23 CFR Part 655National Standards for Traffic ControlDevices; Manual on Uniform TrafficControl Devices; Work Zone TrafficControl Standards Revision; Final Rule




23 CFR Part 655

[FHWA Docket No. 89-1, Notice No. 7]

RIN 2125-AC83

National Standards for Traffic ControlDevices; Manual on Uniform TrafficControl Devices; Work Zone TrafficControl Standards Revision

AGENCY: Federal HighwayAdministration (FHWA), (DOT).ACTION: Final amendments to theManual on Uniform Traffic ControlDevices (MUTCD); Work Zone TrafficControl.

SUMMARY: This document containsamendments which have been adoptedby the FHWA for inclusion in theMUTCD. The MUTCD is incorporatedby reference in 23 CFR part 655, subpartF, and recognized as the nationalstandard for traffic control devices onall public roads open to public travel.The amendments affect part VI of theMUTCD in its entirety, and are intendedto improve the safety of workers,pedestrians, and motorists in temporarytraffic control zones. The amendmentsare also intended to expediteimplementation of the IntermodalSurface Transportation Efficiency Act of1991, and improve traffic operations byproviding more uniform application oftraffic control devices in temporarytraffic control zones.DATES: The final rule is effective January10, 1994. Incorporation by refrence ofthe publications listed in the regulationsis approved by the Director of theFederal Register as of January 10, 1994.FOR FURTHER NFORMATION CONTACT: Mr.Rudolph M. Umbs, Office of HighwaySafety, (202) 366-0411, or Mr. WilbertBaccus, Office of Chief Counsel, (202)366-0780, Federal HighwayAdministration, 400 Seventh Street,SW., Washington, DC 20590.SUPPLEMENTARY INFORMATION: TheMUTCD is approved by the FHWA asthe National Standard for all streets andhighways open to public travel. TheMUTCD is available for inspection andcopying as prescribed in 49 CFR part 7,appendix D. It may be purchased for$28.00 from the Superintendent ofDocuments, U.S. Government PrintingOffice, Washington, DC 20402, stock No.050-001-00308-2. Each amendment isassigned an identification numberwhich indicates, by Roman numeral, theprimary organizational part of theMUTCD affected and, by Arabic

numeral, the order in which thb requestwas received (e.g., Request VII-9).

This document contains thedisposition of Request VI-72(C) TotalRevision of Part VI, concerning part VIof the MUTCD "Traffic Controls forStreet and Highway Construction,Maintenance, Utility, and EmergencyOperations" in its entirety. Part VI setsforth basic principles and prescribesstandards for temporary traffic controlzone operations on streets and highwaysin the United States. Also, part VIaddresses the design, administration,and operation of street and highwaytemporary traffic control plans andprojects. With the FHWA's currentemphasis on rebuilding the Nation'shighways and improving safety in workzone areas, an update of part VI willenable the MUTCD to better serve thehighway community. Previous FederalRegister actions regarding theseamendments are contained in FHWApublic docket 89-1, Notices I through 6.

The text changes resulting from theseamendments to the MUTCD have been.-titled, "1988 MUTCD Revision 3," datedSeptember 3, 1993. It will be availablefrom the Government Printing Office(GPO), Superintendent of Documents,Washington. DC 20402, (202) 783-3238.Everyone currently appearing on theFHWA Office of Highway Safety'sFederal Register mailing list will besent a copy.

Discussion of Amendments

The FHWA received 251 comments inresponse to public docket 89-1, Noticesi through 6. Of these, 157 were inresponse to Notices 1 through 5, and 94were received in response to Notice No..6. The majority of comments supportedthe following conclusions: (1) There isa need to retain most of the trafficcontrol device design and applicationstandards that are presently containedin the current MUTCD; (2) there is aneed for a few new traffic controldevices; and (3) there is a need toprovide users with the new guidanceinformation presented in the publicinformation packages (Notices 1 through4) and in the advance notice ofproposed rulemaking (Notice 5). Most ofthe comments received to all the noticesoffered minor editorial corrections andtext enhancements.

Most commenters to Notice No. 6echoed the above conclusions, andencouraged the FHWA to amend thestandards and to publish part VI: (1) Asa stand alone document; (2) in the sameformat as the 1988 Edition of theMUTCD; and (3) as soon as possible.

All comments regarding standardsand/or guidance materials received inresponse to all sixprevious Notices

were considered and have beenaccommodated to the extent practical.In response to these comments theFHWA has developed a final rule.

The following is a summary of thecomments to Notice No. 6 of this docketconcerning the part VI revisions.

Changed StandardsIn section 6C-6, Transit

Considerations for Temporary TrafficControl Elements, a "Shall" conditionwas changed to a "Should" condition.The third sentence was changed to readas follows: "The TCP should provide forfeatures such as temporary bus stops,pull-outs, and satisfactory waiting areasfor transit patrons." This was changedbecause there may be solutions that willnot require the TCP to include thesefeatures.

In section 6F-8c, Temporary TrafficSignals, a "May" condition was changedto a "Shall" condition. The thirdparagraph, second sentence waschangedto read as follows: "Trafficsignals shall be either hard wired orcontrolled by radio signals." Thisrequirement assures that traffic signalsare interconnected when controlling aone-lane two-way operation.

New DevicesThe Strategic Highway Research

Program (SHRP) has developed two newtraffic control devices (the OpposingLane Divider and the Flashing Stop/Slow paddle) that will be added tosection 6E-4 and 6F-8f of part VI.

Section 6F-5i, Other ChannelizingDevices, was opposed by twocommenters, the American TrafficSafety Services Association andAdvocates for Highway and Auto Safety.Their major concern was that allowingthe use of other channelizing deviceswould trigger rapid efforts within thechannelizing device industry toundercut competitors' markets by, forexample, reducing the size of an-otherwise standard device and, in theprocess, the amount of retroreflectivesheeting and/or the target area visible tomotorists.

The MUTCD allows the use of otherchannelizing devices for specialapplications. Highway agenciescurrently have contracting proceduresin place that allow the use of otherchannelizing devices for specializedapplications. These contractingprocedures may be used even if thedevice is not recognized as a standardin accordance with part VI of theMUTCD. This final rule recognizes theexistence of specialized applications toencourage the continued developmentof and experimentation with suchdevices.


New Word Message Signs

Part VI will include several newstandard word message signs:

1. "Shoulder Drop Off (W8-9a),"which should be used when a shoulderdrop-off exceeds 3 inches in height andis not protected by a portable barrier;

2. "Uneven Lanes (W8-11)," whichshould be used during operations thatcreate a difference in elevation betweenadjacent lanes;

3. "Turn Off Two-Way Radios andCellular Telephones (W22-2)," whichshould follow the "Blasting ZoneAhead" sign and is placed at least 1,000.feet before the beginning of the blastingzone;

4. "No Center Line Stripe (W8-12),"which should be used when the workobliterates the center stripe. The signshould be placed at the beginning of thezone and repeated at 2-mile intervals inlong zones to remind the motorist. Itshould also be used at majorconnections, traffic generators, and/or atappropriate intervals as determined bythe engineer, to advise motoristsentering within the zone. Mostcommenters agreed with the addition ofthe new signs.

Arrow Panel DisplaysPreviously arrow panel display

specifications were written for bulb-typepanels. The specifications in section6F-3 have been modified to allow amatrix of elements. This modificationwill allow Portable Changeable MessageSigns (PCMS's) to be used as arrowpanel displays.

Volume of Guidance Material

The city of Phoenix, Arizona, had thefollowing concerns:

Comment: "The proposed part VIshould not be published to substitute forthe existing part VI of the MUTCD untiland when it is substantially thinned out,and until and when good judgment isused to sort out only those factors thatdeserve to be 'national standards."'

Response: Comments on thevoluminous nature of the revised part VIand the validity of the standards wassolicited in Notice No. 5 issued onJanuary 10, 1992, advance notice ofproposed amendments to the MUTCD.Comments on the validity of thestandards was solicited again in NoticeNo. 6, issued on January 5, 1993. TheFHWA, the National Committee onUniform Traffic Control Devices, andthe commenters offered no substantivesuggestions on how to thin out part VIor on the "good judgment" of thestandards that are in the revised part VI.

Comment: The City of Phoenix alsoexpressed concern over what it

perceived as an increase in the use ofthe mandatory term "Shall" in the latestversion of part VI.

Response: With the addition of thenew sections: Utility and EmergencyTraffic Control, Pedestrian and WorkerSafety, and Portable ChangeableMessage Signs, the use of Shall wasincreased simply because there are moresections in part VI. In addition, thenumber of Typical ApplicationDiagrams has increased significantly.Many of the Shalls found in the text ofpart VI are simply repeated in theexplanation of these TypicalApplication Diagrams. Therefore, nosignificant increase in regulatoryrequirements has occurred.

Comment: Phoenix also stated thatseveral cities had expressed strongopposition to the FHWA's statements inearlier notices that the revised part VIwill not have a significant economicImpact on a substantial number of smallentities.

Response: Many of the.MUTCDrequirements cited by these cities arerequirements of the 1988 and earliereditions of the MUTCD that have beencarried forward to the proposed text,and, therefore, are not attributable to thecurrent regulatory action. The majorityof the commenters did not feel that therevised part VI will have a significanteconomic impact. Based upon itsevaluation of the matter, including thecomments received in response to theearlier notices, the FHWA hasdetermined that the present regulatoryaction will not have a significanteconomic impact on small entities.

Phoenix commented on several othertechnical issues. Each issue has beenspecifically addressed by appropriatetext modifications.

There were 53 other commenters thatprovided comments to the docket thatwere substantially similar to thePhoenix letter.

Rulemaking Analyses and Notices

Executive Order 12866 (RegulatoryPlanning and Review) and DOTRegulatory Policies and Procedures

The FHWA has determined that thisaction is not a significant regulatoryaction within the meaning of ExecutiveOrder 12866 or significant within themeaning of Department ofTransportation regulatory policies andprocedures. As previously discussed inthe above sections on "ChangedStandards" and "New Devices," thisrevision of part VI adds some new,alternate fraffic control devices, andonly a very limited number of new orchanged requirements. Most of thechanges included in this version of part

VI are expanded guidance materials,including many new TypicalApplication Diagrams. The FHWAexpects that application uniformity willimprove at virtually no additionalexpense to public agencies or themotoring public. Therefore, based onthis analysis a full regulatory evaluationis not required.

Regulatory Filexibility ActIn accordarice with the Regulatory

Flexibility Act (5 U.S.C. 601-612), theFHWA has evaluated the effects of thisrule on small entities. As alreadydiscussed, this revision of part VI addssome new, alternate traffic controldevices, and only a very limited numberof new or changed requirements. Mostof changes brought about by this versionof part VI are expanded guidancematerials, including many new typicalapplication diagrams. Based on thisevaluation, the FHWA hereby certifiesthat this action will not have asignificant economic impact on asubstantial number of small entities.

Executive Order 12612 (FederalismAssessment)

This action has been analyzed inaccordance with the principles andcriteria contained in Executive Order12612, and it has been determined thatthe rule does not have sufficientfederalism implications to warrant thepreparation of a Federalism Assessment.The MUTCD is incorporated byreference in 23 CFR part 655, subpart F,which requires that changes to theNational Standards issued by the FHWAshall be adopted by the States or otherFederal agencies within 2 years ofissuance. This amendment is in keepingwith the Secretary of Transportation'sauthority under 23 U.S:C. 109(d) and315 to promulgate uniform guidelines topromote the safe and efficient use of thehighways. Therefore, nothing in the rulepreempts any State laws, regulations, orrequirements.

Executive Order 12372(Intergovernmental Review)

Catalog of Federal DomesticAssistance Program Number 20.205,Highway Planning and Construction.The regulations implementing ExecutiveOrder 12372 regardingintergovernmental consultation onFederal programs and activities apply tothis program.Paperwork Reduction Act

This action does not contain acollection of information requirementsfor purposes of the PaperworkReduction Act of 1980, 44 U.S.C. 3501et seq.



The FHWA has analyzed this-actionfor the purpose of the NationalEnvironmental Policy Act of 1969 (42U.S.C. 4321 et seq.) and has determinedthat this action would not have anyeffect on the quality of the environment.

Regulation Identification Number

A regulation identification number(RIN) is assigned to each regulatoryaction listed in the Unified Agenda ofFederal Regulations. The RegulatoryInformation Service Center publishesthe Unified Agenda in April andOctober of each year. The RIN containedin the heading of this document can beused to cross reference this action withthe Unified Agenda.


Design standards, Grant programs-transportation, Highways and roads,Signs, Traffic regulations, Incorporationby reference.

The FHWA hereby amends chapter Iof title 23, Code of Federal Regulations,part 655, as set forth below.

PART 655--TRAFFIC OPERATIONS


AUTHORrrY: 23 U.S.C 101(a). 104,105.109(d). 114(a), 135.217, 307, 315, and 402(a);23 CFR 1.32 and 1204.4; and 49 CFR 1.48(b).

Subpert F [Amended

2. In § 655.601, paragraph (a) isrevised to read as follows:

§655.601 Purpose

(a) Manual on Uniform Traffic ControlDevices for Streets and Highways(MUTCD), FHWA, 1988, includingRevision No. I dated January 17, 1990,Revision No. 2 dated March 17, 1992,and Revision No. 3 dated September 3,1993- This publication is incorporatedby reference in accordance with 5 U.S.C.552(a) and I CFR part 51 and is on file

at the Office of the Federal Register inWashington. DC. The 1988 MUTCD maybe purchased from the Superintendentof Documents. U.S, GovernmentPrinting Office (GPO). Washington, DC20402 and has Stock No. 050--001-00308-2. The amendments to theMUTCD, titled "1988 MUTCD Revision1," dated January 17, 1990, "1988MUTCD Revision 2," dated March 17,1992, and "1988 MUTCD Revision 3,"dated September 3, 1993, are availablefrom the Federal HighwayAdministration, Office of HighwaySafety, HHS-21, 400 Seventh StreetSW.. Washington, DC 20590. Thesedocuments are available for inspectionand copying as prescribed in 49 CFRpart 7, appendix D.

Isued on: December 3, 1993.Rodney E. Slater,Federal High way A din istm tor.[FR Doc. 93-30209 Filed 12-9-93; 8:45 amilBLaOO Come M4h-p

Friday1 December 10, 1993

* U

m

* E

Part IV

Department of theInteriorFish and Wildlife Service

50 CFR Part 17Endangered and Threatened Wildlife andPlants: Coastal California Gnatcatcher;Rule and Proposed Rule

p




50 CFR Part 17

RIN 1018-AB56

Endangered and Threatened Wildlifeand Plants; Special Rule ConcerningTake of the Threatened CoastalCalifornia Gnatcatcher

AGENCY: Fish and Wildlife Service,Interior.ACTION: Final rule.

SUMMARY: The implementing regulationsfor threatened wildlife under theEndangered Species Act of 1973, asamended (Act), generally incorporatethe section 9 prohibitions forendangered wildlife, except when aspecial rule promulgated pursuant tosection 4(d) applies. At the time thecoastal California gnatcatcher (Polioptilacalifornica californica) was listed asthreatened, the Fish and WildlifeService (Service) did not promulgate asection 4(d) special rule and, therefore,all of the section 9 prohibitions,including the "take" prohibition,became applicable to the species.However, in recognition of a Stateprogram that will provide forconservation and management of thegnatcatcher's habitat in a mannerconsistent with the purposes of the Act,the Service hereby defines, pursuant tosection 4(d), the conditions underwhich take of the coastal Californiagnatcatcher would not be a violation ofsection 9.EFFECTIVE DATE: December 10, 1993.ADDRESSES: The complete file for thisrule is available for public inspection,by appointment, during normal businesshours, at the Carlsbad Field Office, U.S.Fish and Wildlife Service, 2730 LokerAvenue West, Carlsbad, California92008.FOR FURTHER INFORMATION CONTACT:Peter A. Stine, Acting Field Supervisor,at the address listed above (telephone619/431-9440).


Background

The final rule listing the coastalCalifornia gnatcatcher (Polioptilacalifornica californica) as a threatenedspecies under the Endangered SpeciesAct of 1973, as amended (16 U.S.C. 1531et seq.) (Act), was published in theFederal Register on March 30, 1993 (58FR 16742), and contains a discussion ofits status, previous Federal actions onthis species, a summary of thecomments and recommendations

received in response to the Service'sproposal to list the gnatcatcher, detaileddescriptions of the factors affecting itscontinued existence, the reasons whycritical habitat was not designated, andthe conservation measures available tofederally listed species. The Serviceconsiders the coastal Californiagnatcatcher, hereinafter referred to asgnatcatcher, likely to becomeendangered in the foreseeablethroughout its historic range insouthwestern California andnorthwestern Baja California, Mexico,due to widespread habitat destruction,degradation, and fragmentation, and theinadequacy of existing regulatorymechanisms to provide for itsconservation.

Conservation measures available tospecies listed as endangered orthreatened under the Act includerecognition, recovery actions,requirements for Federal protection, andprohibitions against certain activities.Section 4(d) of the Act provides thatwhenever a species is listed as athreatened species, the Service shallissue regulations deemed necessary andadvisable to provide for theconservation of the species. Section 4(d)also provides that the Service may byregulation prohibit any act prohibitedfor endangered species under section9(a) of the Act. These prohibitions, inpart, make it illegal for any personsubject to the jurisdiction of the UnitedStates to take (includes harass, harm,pursue, hunt, shoot, wound, kill, trap,or collect; or to attempt any of these),import or export, ship in interstatecommerce in the course of commercialactivity, or sell or offer for sale ininterstate or foreign commerce anylisted wildlife species. It is also illegalto possess, sell, deliver, carry, transport,or ship any such wildlife that has beentaken illegally. Certain exceptions applyto agents of the Service and Stateconservation agencies.

The implementing regulations forthreatened wildlife (50 CFR 17.31)incorporate, for the most part, theprohibitions for endangered wildlife (50CFR 17.21), except when a special ruleapplies (50 CFR 17.31(c)). At the timethe gnatcatcher was listed as threatened,the Service did not promulgate a specialrule for the species. However, pursuantto section 4(d) of the Act and 50 CFR17.31(c), the Service proposed to definethe conditions under which incidentaltake of the gnatcatcher resulting fromcertain land-use activities regulated byState and local government would notviolate section 9 of the Act. This wasdone in recognition of the significantconservation planning effortsundertaken by the State of California

and several city and countygovernments pursuant to the NaturalCommunity Conservation Planning Actof 1991 (NCCP) (California Fish andGame Code sec. 2800 et seq.). The NCCPprogram intends to provide for theconservation of listed and othersensitive species at a regional orecosystem scale. The Service finds thatimplementation of the NCCP programand the special rule will provide forconservation and management of thegnatcatcher's habitat in a mannerconsistent with the purposes of the Act.

Under the special rule, incidental takeof the gnatcatcher by land-use activitiesaddressed in an approved NCCP planwill not be considered a violation ofsection 9 of the Act, provided theService determines that such a planmeets the issuance criteria for an"incidental take" permit pursuant tosection 10(a)(2)(B) of the Act and 50CFR 17.32(b)(2). Under the special rule,a limited amount of incidental take ofthe gnatcatcher within subregionsactively engaged in preparing a NCCPplan will also not be considered aviolation of section 9 of the Act,provided the activities resulting in suchtake are conducted in accordance withthe NCCP Conservation Guidelines andProcess Guidelines, which werefinalized by the California Departmentof Fish and Game (CDFG) in November1993. The final rule has been modifiedto withdraw the requirement that theguidelines specifically adhere to thestandards set forth under 50 CFR17.3r2(b)(2). This was done in partbecause the NCCP ConservationGuidelines and Process Guidelinescontain the essence of the standardsdelineated in 50 CFR 17.32(b)(2). TheService, as a partner in the NCCPprogram, also is encouraging long-termNCCP efforts leading to the completionand implementation of regionalconservation plans. The Service deemsthe level of habitat loss contemplatedunder the interim procedures of theguidelines insignificant in view of theproposed long-term conservation effortsand short-term mitigation componentsof the NCCP program. In addition, thisstrategy was envisioned by the State'sScientific Review Panel (SRP) and isconsistent with the SRP's recommendedinterim strategy in the guidelines. Themodification of the special rule affectsonly the interim planning period. Therequirement of the special rule that finalNCCP plans meet the standards set forthunder 50 CFR 17.32(b)(2) has not beenchanged.


Summary of Comments andRecommendations

In the March 30, 1993, proposedspecial rule (58 FR 16758) andassociated notifications, all interestedparties were requested to submit factualreports or information that mightcontribute to the development of a finalrule. Appropriate elected officials(including 28 congressionalrepresentatives), 3 State agencies, 4county and 50 city governments, 7Federal agencies, and 50 landownersand other potentially affected orinterested parties were contacted andrequested to comment. A legal noticeannouncing this proposed action andinviting general public comment on theproposal was published in the OrangeCounty Register, Riverside Press-Enterprise, and the San Diego Union-Tribune on April 5, 1993.

* The Service held three publichearings on the proposed special rule. Anotification of the hearings, reopeningof the public comment period, andavailability of a draft EnvironmentalAssessment (EA), draft NCCPConservation Guidelines, and draftNCCP Process Guidelines was publishedin the Federal Register on July 20, 1993(58 FR 38736). A legal noticeannouncing the hearings and invitinggeneral public comment on the proposaland the draft documents cited abovewas published in the Orange CountyRegister on July 12. 1993; the RiversidePress-Enterprise on July 13, 1993; andthe San Diego Union-Tribune on July14,1993. The draft EA, NCCPConservation Guidelines, and NCCPProcess Guidelines were distributed onAugust 2, 1993, to 256 parties, includingthe Governor's Office, 2 State Senators,3 Federal and 3 State agencies, 15 citygovernments, and other interestedparties. Public hearings were conductedin San Diego, California, on August 9,1993; in Irvine, California, on August11, 1993; and in Riverside, California,on August 13, 1993. About 300 peopleattended these hearings.

A total of 198 comments was receivedduring two comment periods thatencompassed almost 4 months. Multiplecomments, whether written or oral fromthe same party on the same date, areregarded as one comment. Of these, 43(22 percent) supported the special rule,64 (32 percent) opposed the special rule,and 91 (46 percent) neither supportednor opposed the special rule.

Several conservation groups andmany individuals expressed support forthe special rule. A variety of publicagencies, private organizations andgroups, and individuals opposed thespecial rule. The majority of

commenters neither supported noropposed the special rule; many of theserespondents expressed various concernsand recommendations for modifying therule and associated documents prior totheir finalization.

The Service has reviewed all of thewritten and oral comments discussedabove. Based on this review, 24 relevantissues have been identified and arediscussed below. These issues arerepresentative of the commentsquestioning or opposing the proposedspecial rule.

Issue 1: The special rule should bemore explicit with respect to the criteriathe Service will use to evaluate theadequacy of a NCCP plan.

Service Response: As discussed underthe "Proposed RegulationsPromulgation" section of the proposedspecial rule, the evaluation standards tobe used by the Service are those setforth in 50 CFR 17.32(b)(2), whichdefines the issuance criteria forobtaining a permit to incidentally takelisted wildlife species under section10(a)(1)(B) of the Act. These criteria aresixfold.

1. The taking will be incidental tootherwise lawful activities and not thepurpose of such activities. In otherwords, any taking allowed under theplan would have to occur inadvertentlyduring normal development activities; itcould not be deliberate and purposeful.In order to define what taking would beallowed under the program, the planmust carefully describe and delineatethe following parameters: theconservation plan boundaries; currentlyproposed activities and all futureactions reasonably certain to occur inthe planning area that may result inincidental take; all extant biologicalinformation regarding the distribution,abundance, and ecology of thegnatcatcher, any other federally listedspecies, and possibly other species ofconcern (proposed, candidate, State-listed species) occurring within theplanning area; and what impacts thetaking would have on the gnatcatcherand other affected species, asappropriate. The plan must also includean analysis of alternatives that wouldnot result in take and an explanation ofwhy these are not being utilized. Ifexisting biological data are nonexistent,vague, or of poor quality, additionalstudies (such as those recommended bythe SRP under the NCCP ConservationGuidelines) may be needed to supportthe conservation and other land-usedecisions proposed under the plan.During the plan preparation phase, theService will provide technicalassistance for determining the adequacyof the biological database, as well as

provide recommendations on additionalstudies that may be needed to providean adequate data baseline from which todevelop a plan. In general, biologicaldata made available must be adequate toevaluate fully the likely impacts ofproposed activities on all affectedspecies being addressed within the plan.Typically, biological data need to becomensurate with the magnitude ofproposed activities.

2. The plan will, to the maximumextent practicable, minimize andmitigate the impacts of the proposedincidental take. Compliance with thisstandard involves a planning strategythat emphasizes avoidance of impacts tothe gnatcatcher (and potentially othersensitive species that may becomelisted), provides measures to minimizepotential impacts by modifyingproposed activities (e.g., clusteringurban development or siting suchactivities in low quality habitat), anddetails compensation measures neededto offset unavoidable impacts. Ingeneral, mitigation measures will becommensurate with the magnitude ofproposed impacts under the plan.

3. The plan must be adequatelyfunded and contain provisions to dealwith unforeseen circumstances.Compliance with this standard requires,first, a detailed description of thefunding that will be made available overthe life of the plan to implement theproposed mitigation program and otherconservation measures. If full funding isnot provided at the time the plan isapproved but is intended to begenerated on a continuing basis, theplan must establish programs andlegally-binding mechanisms to generatesufficient funds for its implementation.The plan should detail the collection,management, and auditing of all funds,including penalties for failure to meetfunding obligations by signatorymembers. Second, becausecircumstances and information maychange over time and may result inunforeseen circumstances, the planmust detail the procedures to deal withsuch circumstances and, if necessary, tomodify the plan. Consequently, the planshould provide for an amendmentprocedure and any other necessarymeasures or assurances to deal withsuch circumstances (e.g., if funding isnot generated at the predicted rate).

4. The taking allowed under the planwill not appreciably reduce thelikelihood of survival and recovery ofthe gnatcatcher in the wild. Thiscriterion is equivalent to the regulatorydefinition. of "jeopardy" under section7(a)(2) of the Act and means to engagein an action that reasonably would beexpected, directly or indirectly, to


reduce appreciably the likelihood ofboth the survival and recovery of thegnatcatcher (or any other listed species)in the wild by reducing itsreproduction, numbers, or distribution.In effect, this criterion requires a "non-jeopardy" finding as a condition forissuance of any incidental take permit.

5. The plan will ensure that othermeasures that the Director of the Servicemay require as being necessary orappropriate will be provided. Suchmeasures, as needed, should becomeapparent during plan developmentthrough coordination between theService, the State, and plan participantsand signatories and will likely includeterms and conditions for monitoringimplementation of the plan to ensurethat its requirements and therequirements of the Act are met.

6. The Director of the Service isassured that the plan will beimplemented. The Service anticipatesthat this requirement will be satisfiedthrough execution of an ImnplementingAgreement (as discussed in detail in theNCCP Process Guidelines), whichlegally binds all participants andsignatories to implement the plan asapproved. The Service recognizes,however, that the ImplementingAgreement cannot alter or usurp theexisting authority of local governmentagencies. Rather, the agreement will,among other things, detail the mannerin which the local agencies will exercisetheir existing authorities to effect land-use in the manner set forth in the plan.Consequently, local governmentagencies will continue to exercise theirduly constituted planning, zoning, andpermitting powers under the plan.However, any actions that violate theImplementing Agreement could invokeremedies for such violations providedunder the agreement itself, and couldalso be a basis for revocation of theService's concurrence undersubparagraph (bl(2)(ii) of the specialrule.

Issue 2: Mitigation requirementsunder the NCCP Conservation andProcess Guidelines may not meet a"constitutionally required nexus."

Service Response: The mitigationguidelines established by eachsubregional planning body will includea range of potential mitigation measuresappropriate for the subregion. Theappropriate level and nature ofmitigation that may be required for aparticular activity will be determined bythe authorizing jurisdiction on a project-by-project basis in conformance withthe mitigation guidelines. The Serviceexpects and intends that mitigationrequirements will be reasonably relatedto the effects of the particular activity on

coastal sage scrub habitat and thegnatcatcher.

Issue 3: The special rule and theNCCP Conservation and ProcessGuidelines will effect a taking of privateproperty.

Service Response: Issuance of thespecial rule by the Secretary, andCDFG's finalization of the NCCPConservation and Process Guidelines,will not constitute a taking of privateproperty. Neither the rule nor the NCCPConservation or Process Guidelinesmake a determination about the usesthat can be made of private property.Under the special rule, procedures areavailable by which property owners canobtain case-by-case determinations ofapplication of the rule and the NCCPConservation and Process Guidelines totheir individual properties. Further,participation under the special rule isvoluntary. A private entity seeking todevelop private property in a mannerthat may result in the incidental take ofthe gnatcatcher in the course of anotherwise legal activity may proceedunder section 7 of the Act if there isFederal agency action involved, applyfor an incidental take permit undersection 10(a)(1)(B) of the Act, or, if theprivate property involved is within ajurisdiction enrolled and activelyengaged in the preparation of a NCCPplan, utilize the special rule.

Issue 4: The NCCP maps and coastalsage scrub habitat acreages presented inthe NCCP Conservation Guidelines andthe draft EA are inaccurate and arevaguely represented to the public andparticipating organizations.

Service Response: The NCCP planningarea encompasses portions of fivecounties and about 3.8 million acres. Asdescribed in the draft EA, the data usedto estimate existing habitat conditionsin the NCCP planning area wereprovided by various local governmententities. Data for San Diego County weredeveloped by several different localgovernment agencies and provided tothe Service by the San DiegoAssociation of Governments. Data forRiverside County were developed forthe county in the course of previousconservation planning efforts. The datadeveloped for Orange County are stillbeing refined and compiled. However, apreliminary acreage estimate of extantcoastal sage scrub habitat for OrangeCounty has been provided to the Serviceby the county. Relatively little coastalsage scrub habitat remains in SanBernardino and Los Angeles Counties.Currently, there are no large-scale dataon the distribution and abundance ofthis habitat type in these counties.

These data represent the bestavailable information on current habitat

conditions. Nevertheless, it should berecognized that, because of the largearea covered by this mapping effort, theresulting maps have a relatively largeminimum mapping unit (approximately2 to 5 acres) and the source data(primarily aerial photography) are fairlysmall in scale (1:24,000). The NCCPmaps depicting the distribution ofcoastal sage scrub vegetation are meantto provide an overview and abiogeographic perspective of largeregions for planning purposes.Comparisons with other mapping effortsof a similar nature are likely to showsome differences due to mappingtechniques and the experience andability of those doing the work. TheService finds that the data used in theseanalyses represent the best informationavailable from local entities currentlyengaged in conservation planning andare adequate to serve the regionalplanning purposes of the NCCPprogram.

Issue 5: The relationship betweensections 4(d), 7, and 10 of theEndangered Species Act should bediscussed with respect to the loss ofcoastal sage scrub habitat during theNCCP planning period.

Service Response: Under the specialrule, incidental take of the gnatcatcherwithin subregions actively engaged inpreparing a NCCP plan will not beconsidered a violation of section 9 of theAct, provided that activities resulting insuch take are conducted in accordancewith the NCCP Conservation andProcess Guidelines. These guidelinesprovide for a maximum 5 percent lossof primarily "low quality" coastal sagescrub in the interim period duringwhich subregional NCCP plans arebeing prepared, provided long-termconservation planning options are notforeclosed and certain other conditionsare met as set forth in the guidelines.The baseline against which this loss ismeasured is the digital (i.e.,computerized) vegetation data providedby the local jurisdictions, updated asappropriate to the date of the listing ofthe coastal California gnatcatcher onMarch 25, 1993.

As coastal sage scrub habitat is lostwithin a NCCP subregion during theplanning period by any means,including activities subject to section 7or section 10(a) of the Act, it will betallied in relation to the 5 percent limit.Once the 5 percent limit is reached inany subregion, the provisions of thespecial rule concerning take of thegnatcatcher would cease to apply forthat subregion until a NCCP plan hasbeen adopted for the subregion andaccepted by the Service under thespecial rule. Additional losses of coastal


sage scrub habitat that result fromactivities that may affect or result in thetake of the gnatcatcher would beevaluated on a case-by-case basisthrough normal regulatory proceduresunder section 7 or section 10(a) of theAct as appropriate. Habitat lossesgreater than 5 percent could potentiallyoccur through section 7 or section 10(a)processes, depending on the results ofthe normal regulatory review process,provided the activity meets thestandards set forth in section 7 orsection 10(a). The NCCP ConservationGuidelines and supportingdocumentation represent the bestavailable information on the biology ofthe gnatcatcher. The Service intends torely on the NCCP ConservationGuidelines and the supportingdocumentation to the maximum extentpermitted by law in reviewing activitiesunder section 7 and section 10(a) of theAct to ensure consistency withcompleted or ongoing subregional NCCPplanning efforts and to prevent theforeclosure of long-term planningoptions.

Issue 6: More clearly explain therelationship of the special rule to thesection 10(a) and section 7 processesunder the Endangered Species Act forobtaining authorization to incidentallytake the gnatcatcher.

Service Response: As a full cooperatorin the NCCP program, the Service iscommitted to accomplishing theobjectives of the program. All activitiesthat the Service evaluates under itsexisting authorities will be analyzed todetermine how they interact with andaffect the NCCP program. The Servicewill support activities contributing tothe completion of subregional NCCPplans prepared in accordance with theNCCP Conservation and ProcessGuidelines in so far as is legallyallowable under the Service's mandatesunder the Endangered Species Act.

Section 7 and section 10(a) of the Actprovide regulatory mechanisms forobtaining authorization to incidentallytake listed species. The provisions ofthese sections of the Act, and theirimplementing regulations, apply to thegnatcatcher. With the promulgation ofthe special rule, another regulatorymechanism is provided to allow take ofthe gnatcatcher incidental to otherwiselawful activity. Under the special rule,incidental take of the gnatcatcher withinenrolled jurisdictions actively engagedin the preparation of a NCCP plan willnot be considered a violation of section9 of the Act, provided such take occursin accordance with the NCCPConservation and Process Guidelines,until the 5 percent coastal sage scrubhabitat loss limit is reached. At that

point, and until a NCCP plan isapproved by the State and enrolledjurisdictions and accepted by theService, the incidental take ofgnatcatchers would be subject to theprohibitions under section 9 of the Act.Section 7 and section 10(a) remain inplace as options for reconciling actionsinvolving take of the gnatcatcher withthe prohibitions against take containedin section 9 of the Act. As stated in theresponse to Issue 5, the Serviceconsiders the NCCP ConservationGuidelines and supportingdocumentation to represent the bestavailable information concerning thebiological needs of the gnatcatcher andintends to rely on the NCCPConservation Guidelines and supportingdocumentation to the maximum extentpermitted by law in reviewing activitiesunder section 10(a) and section 7 of theAct.

Issue 7: Identify/elaborate on whatconstitutes adequate mitigation duringthe NCCP subregional planning period.

Service Response: The NCCP ProcessGuidelines, prepared by CDFG todescribe how the NCCP planningprocess will be implemented, haveincorporated specific guidance forsecuring interim habitat loss approval.These guidelines include the followingelements that address the issue of whatconstitutes adequate mitigation.

Each NCCP subregional lead orcoordinating agency is required toestablish interim habitat loss mitigationguidelines appropriate for the subregionin order to authorize any loss of coastalsage scrub habitat. These guidelinesmust meet the minimum standardsidentified in the NCCP ProcessGuidelines and must be concurred withby CDFG and the Service prior toimplementation. The mitigationstandards include minimizing projectimpacts and mitigating those impactswith off-site acquisition of habitat,dedication of land on-site, restorationand enhancement of coastal sage scrubhabitat, management agreements,transfer of development rights, or othermitigation approved by the Service andCDFG. Mitigation may be concurredwith on a case-by-case basis prior toadoption of the subregional guidelines.As stated in the NCCP ConservationGuidelines, full mitigation of interimhabitat losses may be incorporated, inpart, through completion andimplementation of the subregionalNCCP plans. The subregional NCCPplans are intended to (1) promote theconservation of biodiversity; (2) providefor high likelihood of persistence oftarget species, including thegnatcatcher; and (3) provide for no net

loss of habitat value from presentconditions.

Issue 8: There is insufficientinformation contained in the EA and thepotential impacts are too great to justifyinterim take of the gnatcatcher.Therefore, an Environmental ImpactStatement (EIS) is required.

Service Response: The Service findsthat the EA contains sufficientinformation to evaluate the potentialimpacts to the gnatcatcher from theproposed special rule. The Service alsofinds that those impacts will not besignificant for the reasons outlinedbelow.

Estimates of the acreage and locationof potentially affected coastal sage scrubhabitat and gnatcatcher pairs, based onexisting vegetation data provided bylocal jurisdictions and known locationsof gnatcatchers, are described in detailin the EA. Under the provisions of theNCCP Conservation Guidelines, up to 5percent of existing coastal sage scrubhabitat could be lost, and an estimated66 to 116 pairs of gnatcatchers could beincidentally taken under the provisionsof the special rule during the planningperiod. The 5 percent loss of existingcoastal sage scrub habitat representsabout 20,000 acres of slightly more than400,000 acres of coastal sage scrubfound within the entire NCCP planningarea. Under the NCCP ConservationGuidelines, loss of coastal sage scrubhabitat will occur largely in areas oflower potential conservation valuewithin a subregion. These areas arelargely small fragments of habitat thatoccur on the fringes of existing urban oragricultural development. The NCCPConservation Guidelines conservativelyestimate that enhancement andrestoration of existing coastal sage scrubhabitat can compensate for a loss of upto 5 percent of coastal sage scrub habitatduring this period withoutcompromising the conservation of thegnatcatcher or other coastal sage scrubspecies. No loss of habitat would occurduring the planning period that wouldforeclose options for long-termconservation planning andimplementation, and mitigation forthese losses must be provided inaccordance with the NCCP Conservationand Process Guidelines.

The estimated maximum of 66 to 116pairs of gnatcatchers potentially affectedby activities during the interim planningperiod represent about 3 to 5 percent ofthe United States population. Thesepairs will be from areas of relatively lowconservation value, as defined by theNCCP Conservation Guidelines, and theimpacts to these pairs will be mitigatedin accordance with the NCCPConservation and Process Guidelines.


The Service has conducted an internalconsultation under section 7 of the Actto evaluate the effects of the proposedspecial rule on the gnatcatcher duringthe interim planning period and hasconcluded that the rule is not likely tojeopardize the continued existence ofthis species.

Additional loss of coastal sage scrubhabitat and incidental take of thegnatcatcher could occur under anapproved subregional NCCP plan, butonly if the Service concurs that the planmeets the issuance criteria under 50CFR 17.32(b)(2). Impacts to thegnatcatcher resulting from the approvalof a NCCP plan will be addressed underseparate National Environmental PolicyAct review and section 7 consultationprocedures.

Based on its independent review ofthe NCCP Conservation and ProcessGuidelines and the analysis presentedin the EA, the Service finds that theenvironmental impacts of the proposedspecial rule will not be significant and,therefore, preparation of an EIS is notrequired. The Service additionally findsthat the rule is not likely to jeoparcjizethe continued existence of thegnatcatcher. Long-term conservationopportunities will not be compromisedby losses of coastal sage scrub duringthe NCCP subregional planning period;they should in fact be enhanced.

Issue 9: Certain activities, such aspublic works projects, agriculturalactivities, or loss of coastal sage scrubon parcels less than 5 acres in size,should be exempt from the takeprohibitions under section 9 of the Act,as well as from the requirements of theNCCP program.* Service Response: These suggestedchanges were not made because suchexemptions are inconsistent with theobjectives of the Act and itsimplementing regulations, and areinconsistent with the NCCPConservation and Process Guidelines.

Issue 10: Public utility-relatedactivities often occur in linear projectareas that should be treated separatelyin the special rule and under a separateregional plan that is consistent with theNCCP program.

Service Response: The Servicerecognizes the unique circumstancesassociated with utility and other typesof linear projects. The Service alsorecognizes that circumstances mayoccur in which a proposed public utilityproject may cross a jurisdiction that hasdeclined to enroll within the NCCPprogram. Therefore, in these uniquecases, the Service recognizes theflexibility in the section 4(d) and NCCPprocesses to allow utilities to be treatedas subregions for planning purposes.

The Service recognizes also that everylinear project proponent cannot betreated as a subregion and will allowthis planning method on a case-by-casebasis for regional entities such aselectrical, gas, and water utilities. Linearprojects that are located within asubregion or cross into adjacentsubregions must be included within theplans for those subregions. Any habitatdestroyed within a subregion or subareaduring the interim planning phase willbe tallied against that subregion's orsubarea's 5 percent interim habitat lossallocation.

Issue 11: Some of the identifiedmitigation options listed in the NCCPConservation Guidelines are eitheruntried or unavailable. One commenterstated that all parties need toacknowledge the highly experimentalnature of restoration efforts in coastalsage scrub habitat and that successfulrestoration criteria should beestablished and successfullydemonstrated before any furthersignificant losses of habitat occur.Because of the speculative nature ofenhancement/restoration, it should notbe regarded at this time as an adequatemeans for compensating the loss ofmoderate or high value coastal sagescrub habitat.

Service Response: The enhancement/restoration of coastal sage scrub habitatis experimental. However, in spite of theuncertainty of success of enhancement/restoration, its use as a mitigationmeasure in the interim process isappropriate based on the limited habitatimpact that may occur during theinterim process (5 percent) and thepotential application value of theserestoration/enhancement efforts inpreparing and implementing NCCPplans. Based on the results of initialrestoration efforts, the Service (incooperation with CDFG and restorationspecialists) will establish specificrestoration success criteria that will beincorporated into NCCP plans.

Issue 12: The research agendaoutlined by the SRP in the NCCPConservation Guidelines should bemandatory and should be prioritized.

Service Response: Additionalscientific information is needed to guideregional conservation planning effortssuch as the NCCP program. Howevef,the degree to which these data will beneeded during the planning period willgenerally be commensurate with themagnitude of impacts proposed under aNCCP plan.

Of the six research tasksrecommended by the SRP, as discussedin the NCCP Conservation Guidelines,one (biogeography and inventory ofcoastal sage scrub) will be required to

support any subregional plan, and twoothers (trends in biodiversity andgenetic studies) will be necessary toevaluate the success of NCCP plans.Some of the research recommended bythe SRP is already under way: theMarine Corps is funding an ecologicalstudy of the gnatcatcher and cactuswren (Campylorhynchusbrunneicapillus couesi) at CampPendleton in northern San DiegoCounty; Southern California Edison isfunding a similar type of researchproject in the San Joaquin Hills ofOrange County and at the Palos VerdesPeninsula in Los Angeles County; andthe Metropolitan Water District ofSouthern California is funding long-term research on the gnatcatcher inwestern Riverside County. In addition,both the Service and CDFG are seekingadditional funding to implement, inpart, the SRP's research agenda.Additional research funds should beprovided by subregional and subareaplanning efforts.

The Service and CDFG will also beestablishing a committee (asrecommended by the SRP] to developmore explicit research protocols for thegeneral research tasks outlined in theNCCP Conservation Guidelines. Ingeneral, these protocols will vary fromsubregion to subregion, and will bedetermined by the size and types of datagaps, scale of the planning effort, and acombination of priority and fundingconsiderations. Actual researchschedules will be tailored to the scopeand timing of subregional planningactivities.

Issue 13: Existing local land-useregulations must be modified toimplement the NCCP program.

Service Response: The Service agrees.As discussed previously under theresponse to Issue 1, local regulatoryagencies are expected to commitformally to NCCP plan implementationthrough the execution of anImplementing Agreement (as discussedin detail in the NCCP ProcessGuidelines), which legally binds allparticipants and signatories toimplement the plan as approved. TheService recognizes, however, that theImplementing Agreement must beconsistent with State law governinglocal agency authority and must belegally enforceable. The ImplementingAgreement should detail the manner inwhich the local agencies will exercisetheir existing authorities to effect land-use in the manner set forth in the plan.

Issue 14: The SRP or an equivalentadvisory committee should beestablished to further guide the regionalconservation planning efforts under theNCCP program.


Service Response: The Service agrees.CDFG and the Service are discussingvarious options, includingreconstituting the SRP, establishing acoastal sage scrub "recovery" team, andorganizing technical teams to focus onvarious aspects of coastal sage scrubconservation.

Issue 15: The affects of the NCCPf rogram on non-participating

downers within enrolledjurisdictions should be explained.

Service Response: Landowners aresubject to local land-use regulationswhether or not they are activelyparticipating in the NCCP program. Ifproperty lies within a NCCP-enrolledjurisdiction and is subject to adiscretionary action by that jurisdiction,the landowner will be subject to anyNCCP-related requirements establishedby the local agency under its existingauthorities to effect land-use and willalso have the benefits of the special ruleduring the planning period. Once aNCCP plan has been approved, allproperty within the plan boundarieswill be subject to the terms andconditions of the approved plan.

Issue 16: Both the NCCP program andthe special rule need to adequatelyaddress the economic impacts of theseactions on potentially affected parties.

Service Response: The Service agreesthat the economic impacts of the NCCPprogram and special rule must beaddressed. The NCCP program will beimplemented through preparation of,subregional NCCP plans, preparedpursuant to and consistent with theNCCP Conservation and ProcessGuidelines. Each NCCP plan is intendedto identify and provide for protection ofhabitat and wildlife diversity, whileallowing compatible and appropriateland development in the subregion.Each NCCP plan will identifypermanent habitat preserve areas andsites with low conservation value thatwould be more appropriate for landdevelopment purposes. An analysis ofthe economic impacts of suchdesignations within a NCCP plan will berequired in the joint Federal/Stateenvironmental document that will beprepared for each plan, as discussed inthe "National Environmental PolicyAct" section of this rule.

The socio-economic effects thatwould be expected to occur in theinterim planning period (while a NCCPplan is being prepared) were addressedby the Service in the EA for theproposed special rule. In the EA, theService found that the populationgrowth forecasted for-the five-countyNCCP planning area would placeincreasing demands for residential andother associated development on local

communities. The prohibitions,pursuant to section 9 of the Act, on takeof the gnatcatcher could result inadverse socio-economic impacts, due toconstraints on development in areas thatare occupied or used by gnatcatchers.Under the provisions of the special rule,a limited amount of incidental take ofthe gnatcatcher within subregionsactively engaged in preparing a NCCPplan would not be considered aviolation of section 9 of the Act,provided the activities resulting in suchtake are conducted in accordance withthe NCCP Process and ConservationGuidelines. For this reason, the Servicefound that the interim provisions of thespecial rule could result in alleviatingsome of the existing Endangered SpeciesAct-related constraints on development,while encouraging communities toproceed with the NCCP planningprocess. The EA found that significantsocio-economic impacts would not beexpected to result from the special rule.

The Service has also reviewed thespecial rule within the context ofExecutive Order 12866. The Service hasdetermined that the special rule will nothave a'significant economic effect on asubstantial number of small entitiesunder the Regulatory Flexibility Act.

Issue 17: The technicaldocumentation used by the SRP inpreparing the NCCP ConservationGuidelines was not available for publicreview during the comment period.

Service Response: The SRP usedscientific and technical information thatwas available as of March 1993 indeveloping its recommendedconservation strategy, which wasincorporated into CDFG's NCCPConservation Guidelines. Theinformation used by the SRP wasgenerally available in the publishedscientific literature and is described in"Scientific Review Panel ConservationGuidelines and Documentation," whichis available from CDFG. This documentincludes unpublished analysesdeveloped by SRP members and CDFGstaff during the preparation of the NCCPConservation Guidelines, and asummary and review of published andunpublished data regarding the biologyof the coastal sage scrub community.Although the technical documentationused by the SRP was not fully compiledinto the single document referencedabove until October 1993, most of theinformation had been previouslyreleased by CDFG to the public during1992 as NCCP documents (e.g., "TheCoastal Sage Scrub CommunityConservation Planning Region,""Sensitive Species Associated withCoastal Sage Scrub," and"Subregionalization for Natural

Communities Conservation Planning"),and the scientific publications citedtherein are available in technicallibraries.

Issue 18: Adequate NCCP plans forconserving the coastal sage scrubcommunity cannot be based solely onthree "target" species.

Service Response: The SRPdetermined that conservation effortsthat plan for these three "target" specieswould form the basis for maintainingthe viability of the remaining coastalsage scrub ecosystem because of theirbroad distribution throughout much ofthe coastal sage scrub communitywithin the NCCP planning area. Targetspecies are only part of the conservationstrategy under the NCCP program,which emphasizes a habitat andcommunity-based approach. The targetspecies are only one measure ofcommunity conservation. The Serviceanticipates that information on otherspecies will be gathered in conjunctionwith NCCP-related research activities.

For purposes of subregional planning,the target species may need to besupplemented by other species ofconcern. The inclusion of other specieswill be determined by consideration ofthe planning needs for the subregion,the degree to which unusual habitatrequirements for the species makehabitat-based or target species-basedplanning unreliable as conservationtools, and the anticipated regulatorystatus of the species.

Other species are addressed in theNCCP Process Guidelines. As discussedin the NCCP Process Guidelines, asubregional NCCP must meet FederalEndangered Species Act section 10(a)criteria for it to be accepted asequivalent to a Habitat ConservationPlan for incidental take of federallylisted species. A NCCP plan may alsocover additional species providedsection 10(a) criteria are met. If suchspecies are subsequently listed asthreatened or endangered under the Act,the plan would support the issuance ofa section 10(a) incidental take permit forthose species barring significant newinformation or unforeseencircumstances.

Issue 19: The scientific basis for the5 percent interim habitat loss limitunder the NCCP program should beprovided.

Service Response: The 5 percentinterim coastal sage scrub loss figurerepresents a conservative estimate of theamount of habitat that could be lost ineach subregion without foreclosingconservation planning options. In theopinion of the SRP, the 5 percent limitwould result in a level of habitat lossthat can be compensated for by long-


term management of coastal sage scrubhabitat. As explained in the NCCPConservation Guidelines and EA. loss of5 percent of coastal sage scrub habitatcan be sustained with no net loss ofhabitat value based on reasonableprojections of long-term habitatenhancement and restorationopportunities provided for by the NCCPprogram.The 5 percent figure is not intended

to be a NCCP standard for conservationof the coastal sage scrub community. Insome subregions, more than a 5 percentinterim habitat loss may be possiblewithout significantly foreclosingplanning options. However, theacceptability of greater than a 5 percentinterim loss must be demonstrated bythe results of additional research,restoration, and management activities.

Issue 20: The Service should explainwhy it is allowing for a 20 percent lossof habitat for the Federal endangeredStephens' kangaroo rat (Dipodomysstephensi) and only a 5 percent loss ofcoastal sage scrub under the NCCPprogram and the special rule.

Service Response: In the case of theStephens' kangaroo rat, the 20 percentloss of habitat (authorized under anincidental take permit pursuant tosection 10(a)(1)(B) of the Act for certainportions of its range in westernRiverside County) reflects an analysis ofthe best available scientific informationon the status and ecology of this species.This determination was made more than2 years after the listing of this speciesand after the preparation of an interimHabitat Conservation Plan. On the basisof this analysis, the Service found thatthe Stephens' kangaroo rat can sustaina 20 percent habitat loss in these areasand still remain viable, provided thatthe Habitat Conservation Plan approvedwith the issuance of the "take" permitis fully implemented.

In a similar manner, an analysis of thebest available scientific information onthe status and ecology of the coastalsage scrub community was recentlycompleted by the SRP for the NCCPprogram.

On the basis of this analysis, the SRPconcluded that a 5 percent loss ofrelatively low value coastal sage scrubhabitat would not foreclose long-termconservation planning options underthe NCCP program. Additional losses ofcoastal sage scrub habitat may occurunder approved NCCP plans providedthey are consistent with the NCCPConservation Guidelines prepared byCDFG and provided they meet theissuance criteria under 50 CFR17.32(b)(2).

Issue 21: Clearly define agencyprocedures for suspending or

withdrawing the provisions of thespecial rule, and provide for publicparticipation in this process.

Service Response: Procedures forsuspending or withdrawing theprovisions of the special rule must beincluded in the ImplementingAgreement prepared for each NCCPplan, as required by the NCCP ProcessGuidelines. The ImplementingAgreement prepared by the planproponent must be approved by theService and CDFG and must be signedby the NCCP plan participants and theService prior to incidental take of listedspecies.

To ensure that activities that occurduring the interim planning period areconsistent with the NCCP Conservationand Process Guidelines, the final rulehas been modified to include Servicereview and monitoring of theimplementation of the guidelines. Every6 months during the interim planningperiod, the Service will review theNCCP Conservation Guidelines andProcess Guidelines and their applicationto ensure that activities are being carriedout in accordance with the guidelinesand that regional and subregionalconservation objectives are being met. Ifthe Service determines thatimplementation efforts are notconforming to the guidelines, theService will consult with CDFG to seekappropriate modification of theguidelines or their application asdefined therein. If appropriatqmodification of the guidelines or theirapplication, as defined therein, duringthe interim planning period does notoccur, the Service may revoke theinterim take provisions of this specialrule on a subregional or subarea basis.The Service will publish the revocationfindings in the Federal Register andprovide for a 30-day public commentperiod prior to the effective date forrevoking the provisions of the specialrule in a particular area.

The Service emphasizes that the localgovernments under the NCCP programhave the primary responsibility forensuring compliance with theguidelines during this interim period.The Service intends that its semiannualevaluation of compliance with theguidelines and the regional andsubregional conservation objectives willnot duplicate local enforcement on aparcel-by-parcel basis.

Issue 22: Funding requirements andsources must be identified for NCCPresearch, program implementation, andpreserve acquisition.

Service Response: Each NCCP planpresented to the Service will require anappropriate funding mechanism thatensures the plan will be fully

implemented. The sources and extent offunding provided for in a particularplan will depend on the specificprovisions of the plan. Theresponsibility to identify and ensurefunding commensurate with theconservation measures provided in theplan rests with the plan proponent. TheService will carefully review each planto ensure that the funding provided isadequate to cover all aspects of planimplementation. Potential componentsof a plan that will require fundinginclude preserve acquisition, preservemanagement, and habitat and speciesmonitoring. Funding for research mayalso be provided. The Service and CDFGintend to support some research effortsas well, particularly those kinds ofresearch that are regional in scope.

The Service does not propose todictate the types of funding mechanismsplan proponents may choose or directhow the funds must be used toimplement the plan. The Service isinterested in maintaining maximumflexibility in the process and willaddress the adequacy of fundingmechanisms in the context of the'particular plan presented to the Service.Regional plans will ultimately have tocomply with 50 CFR 17.32(b)(2), whichincludes a demonstration of adequatefunding mechanisms for the program.

Issue 23: The special ruleinappropriately extends legal protectionto coastal sage scrub habitats that arenot used by the gnatcatcher.

Service Response: The special ruledefines the conditions under whichactivities involving take of thegnatcatcher will not be considered aviolation of section 9 of the Act; that isthe extent of its legal authority. Theintent of the special rule is to assistlocal jurisdictions in conserving coastalsage scrub and the variety of speciesthat inhabit this community throughtheir participation in the NCCPprogram. While participation in theNCCP program is voluntary, the specialrule provides incentives forparticipation by eliminating thenecessity and costs of procuringincidental take permits under section10(a) of the Act on an individual projectbasis and facilitating comprehensiveplanning for the conservation of thegnatcatcher and other coastal sage scrubspecies on a regionwide basis. Suchregional planning is expected to affordsignificant protection for the gnatcatcherand the entire coastal sage scrubecosystem, thus reducing threats toother coastal sage scrub species andproviding a significant measure ofcertainty for future development in theregion.


Issue 24: The planning timelines andphases for NCCP plans should beclarified, including what is expected atthe subregional and subarea levels.

Service Response: The Serviceanticipates that the planning timelinesfor subregional NCCP plans will varyaccording to the specific conditionswithin the local jurisdiction orsubregion. As stated in the NCCPProcess Guidelines, the NCCP programis intended to give flexibility to eachsubregional effort to reflect localconditions, while still maintaining aregional conservation perspective.Planning may proceed on a subareabasis prior to the development of asubregional NCCP plan, provided thesubarea NCCP plan contains a sectionthat describes in detail how the subareaplan integrates its preserve areas andmanagement across subarea andsubregional boundaries. The subregionallead or coordinating agency mustconfirm that any subarea plan either isconsistent with the subregional plan ordoes not preclude long-termconservation planning options withinthe subregion.

The NCCP Process Guidelines intendfor local jurisdictions to adapt the NCCPprocess to their existing administrativeprocesses relating to plan preparation,public review, and environmentalreview. Each NCCP plan must undergoenvironmental review, pursuant to theCalifornia Environmental Quality Act(CEQA) and the National EnvironmentalPolicy Act (NEPA). As noted in theProcess Guidelines and in the NEPAsection of this special rule, a joint State/Federal environmental document willbe prepared. In terms of a planningtimeline, the Service anticipates thatmost NCCP plans will be preparedconcurrent with the environmentaldocumentation. In general, this process,including draft NCCP plan preparation,environmental documentation, andpublic review, is estimated to take atleast 1 year to complete.

Once a final draft NCCP plan and theaccompanying joint EnvironmentalImpact Report (EIR)/EA orEnvironmental Impact Statement (EIS),whichever is applicable, are preparedand submitted to the Service for finalreview and approval, the Service willallow for a maximum 120-day period toreview draft NCCP plans. This timelineassumes that the Service is involvedearly in the NCCP planning process, asrecommended in the NCCPConservation and Process Guidelines.Problems should be identified andresolved early in the process, resultingin a final NCCP plan that is acceptableto all parties and is approved within theabove timeframe. Once the NCCP plan

* and joint environmental document areapproved, the Service will publish aFinding of No Significant Impact(FONSI) or Record of Decision (ROD), asapplicable, In the Federal Register,which signifies the completion of theNEPA process. The FONSI or ROD willbe published as close to the close of the120-day review period as possible. Aninternal section 7 consultation must beconducted by the Service for each NCCPplan. The results of the internal section7 consultation are usually included inthe final joint EIR/EA or EIR/EIS and arealways noted in the FONSI or ROD. The120-day review period assumes that theinternal section 7 consultation will beperformed within this timeframe.

The draft NCCP plan andenvironmental documentationsubmitted to the Service should also beaccompanied by a draft ImplementingAgreement. An ImplementingAgreement is a legally bindingdocument that outlines theresponsibilities of all parties inimplementing the conservationmeasures outlined in the NCCP plan.The signature of the Service indicatesthe Service's final approval of the NCCPplan. Only after the ImplementingAgreement is signed by all parties,including the Service, can take of thegnatcatcher occur in accordance withthe provisions of the NCCP plan. TheService will attempt to review andresolve any problems with theImplementing Agreement within the120-day review period. However, giventhe legal, often extremely detailednature of Implementing Agreements, theService cannot guarantee that it canreview and finalize the ImplementingAgreement within this timeframe. TheService will make every attempt toresolve Implementing Agreement issuesas quickly as possible.

As provided by 5 U.S.C. -553(d)(3), theService has determined that good causeexists to make this rule effective on thedate of publication. Delay inimplementation of the effective datewould hinder conservation efforts forthe gnatcatcher and its habitat.


The Service has completed an EApursuant to the'National EnvironmentalPolicy Act of 1969. The EA analyzes theenvironmental effects of activitiesconducted under ftie provisions of thespecial rule that involve the incidentaltake of the gnatcatcher during the NCCPplanning period. The Service hasdetermined that the special rule will notresult in a significant impact to theenvironment and therefore does notrequire the preparation of an EIS.

The Service will continue to complywith NEPA in implementing theprovisions of the special rule. Pursuantto the NCCP Process Guidelines, a jointState/Federal environmental documentthat satisfies the requirements of NEPAand CEQA will be prepared for eachNCCP plan.

Regulatory Flexibility Act andExecutive Order 12866

This special rule has been reviewedunder Executive Order 12866. TheDepartment of the Interior hasdetermined that the special rule will nothave a significant economic effect on asubstantial number of small entitiesunder the Regulatory Flexibility Act (5U.S.C. 601 et seq.). Based uponinformation discussed in this rule andin the EA, it is not expected thatsignificant economic impacts will resultfrom implementing the provisions of thespecial rule. Also, no direct costs,enforcement costs, or informationcollection or recordkeepingrequirements are imposed on smallentities by this rule. This action doesnot impose any recordkeepingrequirements as defined by thePaperwork Reduction Act of 1980.List of Subjects in 50 CFR Part 17

Endangered and threatened species,Exports, Imports, Reporting andrecordkeeping requirements, andTransportation.

Regulation PromulgationAccordingly, part 17, subchapter B of

chapter I, title 50 of the Code of FederalRegulations, is amended as set forthbelow:

PART 17-[AMENDED],


Authority: 16 U.S.C. 1361-1407; 16 U.S.C.1531-1543; 16 U.S.C. 4201-4245; Pub. L 99-625, 100 Stat. 3500, unless otherwise noted.

§ 17.11 (h) [Amended]2. Amend § 17.11(h), in the entry in

the table under BIRDS for "Gnatcatcher,coastal California", in the lost column"Special rules", by revising "NA" toread "17.41(b)".

3. Amend § 17.41 by addingparagraph (b) to read as follows:

§17.41 Special rules-birds.

(b) Coastal California gnatcatcher(Polioptila californica californica). (1)Except as noted in paragraphs (b)(2) and(3) of this section, all prohibitions of§ 17.31 (a) and Mb) shall apply to thecoastal California gnatcatcher.


(2) Incidental take of the coastalCalifornia gnatcatcher will not beconsidered a violation of section 9 of theEndangered Species Act of 1973, asamended (Act), if it results fromactivities conducted pursuant to theState of California's Natural CommunityConservation Planning Act of 1991(NCCP), and in accordance with a NCCPplan for the protection of coastal sagescrub habitat, prepared consistent withthe State's NCCP Conservation andProcess Guidelines, provided that:

(i) The NCCP plan has been prepared,approved, and implemented pursuant toCalifornia Fish and Game Code sections2800-2840; and

(ii) The Fish and Wildlife Service(Service) has issued written concurrencethat the NCCP plan meets the standardsset forth in 50 CFR 17.32(b)(2). TheService shall issue its concurrencepursuant to the provisions of theMemorandum of Understanding (MOU),dated December 4, 1991, between theCalifornia Department of Fish and Gameand the Service regarding coastal sagescrub natural community conservationplanning in southern California. (Copiesof the State's NCCP Conservation andProcess Guidelines and the MOU areavailable from the U.S. Fish and

Wildlife Service, Carlsbad Field Office,2730 Loker Avenue West, Carlsbad, CA92008.) The Service shall monitor theimplementation of the NCCP plan andmay revoke its concurrence under thisparagraph (b)(2)(ii) if the NCCP plan, asimplemented, fails to adhere to thestandards set forth in 50 CFR17.32(b)(2).

(3) During the period that a NCCPplan referred to in paragraph (b)(2) ofthis section is being prepared,incidental take of the coastal Californiagnatcatcher will not be a violation ofsection 9 of the Act if such take occurswithin an area under the jurisdiction ofa local government agency that isenrolled and actively engaged in thepreparation of such a plan and such takeresults from activities conducted inaccordance with the NCCP ConservationGuidelines and Process Guidelines.

(4) The Service will monitor theimplementation of the NCCPConservation and Process Guidelines asa whole, and will conduct a reviewevery 6 months to determine whetherthe guidelines, as implemented, areeffective in progressing toward ormeeting regional and subregionalconservation objectives during theinterim planning period. If the Service

determines that the guidelines are noteffecting adequate progress toward ormeeting regional and subregionalconservation objectives, the Service willconsult with the California Departmentof Fish and Game pursuant to the MOUto seek appropriate modification of theguidelines or their application asdefined therein. If appropriatemodification of the guidelines or theirapplication as defined therein does notoccur, the Service may revoke theinterim take provisions of this specialrule on a subregional or subarea basis.The Service will publish the findings forrevocation in the Federal Register andprovide for a 30-day public commentperiod prior to the effective date forrevoking the provisions of the specialrule in a particular area. Revocationwould result in the reinstatement of the-take prohibitions set forth under 50 CFR17.31(a) and (b) in the affected NCCParea.

Dated: November 23, 1993.George T. Frampton Jr.,Assistant Secretary for Fish and Wildlife andParks.[FR Doc. 93-30235 Filed 12-9-93; 8:45 am)BILLUNG CODE 43104,-P

Federal Register / Vol. 58. No. 236 / Friday, December 10, 1993 / Proposed Rules



50 CFR Part 17

Endangered and Threatened Wildlifeand Plants; Notice of Availability of aFinal Environmental Assessment andFinding of No Significant Impact forthe Proposed Special Rule To AllowIncidental Take of the ThreatenedCoastal California GnatcatcherAGENCY: Fish and Wildlife Service,Interior.ACTION: Notice of document availability.

SUMMARY: The Fish and Wildlife Service(Service) published a proposed specialrule on March 30, 1993 (58 FR 16758),pursuant to section 4(d) of theEndangered Species Act of 1973, asamended (Act), to define the conditionsunder which incidental take of thethreatened coastal Californiagnatcatcher (Polioptila calfornicacalifornica) resulting from land-useregulated by State and localgovernments would not violate section9 of the Act. The proposed action wouldresult in the loss of a maximum of 5

ercent of the'existing coastal sage scrubabitat, estimated to be approximately

20,920 acres, and up to 116 pairs ofgnatcatchers would be taken. TheService has prepared a finalEnvironmental Assessment (EA) and aFinding of No Significant Impact(FONSI) for the proposed special rule.The Service has determined that theissuance of a special rule is not aFederal action that would significantlyalter the quality of the humanenvironment within the meaning ofsection 102(2)(c) of the NationalEnvironmental Policy Act of 1969.Accordingly the preparation of anEnvironmental Impact Statement on theproposed action is not required. Thisnotice is provided pursuant to NationalEnvironmental Policy Act regulations(40 CFR 1506.6).

ADDRESSES: Requests for copies of andinquiries regarding the EA and FONSIshould be addressed to Mr. Peter A.Stine, Acting Field Supervisor, U.S.Fish and Wildlife Service, 2730 LokerAvenue West, Carlsbad, California92008.FOR FU M1ER INFORMATION CONTACT. Ms.Tara V. Wood, U.S. Fish and WildlifeService, Sacramento Field Station, 2800Cottage Way, Room E-1803,Sacramento, California, 95825 (916/978-4866), or Mr. Peter A. Stine (seeADDRESSES section) (telephone 619/431-9440).SUPPLEMENTARY INFORMATION: On March30, 1993, the Fish and Wildlife Service(Service) published a proposed specialrule (58 FR 16758), pursuant to section4(d) of the Endangered Species Act of1973, as amended (Act), to define theconditions under which Incidental takeof the threatened coastal Californiagnatcatcher (Polioptila californicacalifornica) resulting from land-useregulated by State and localgovernments would not violate section.9 of the Act. The Service has prepareda final Environmental Assessment (EA)and a Finding of No Significant Impact(FONSI) for the proposed special rule.The EA evaluates the potential effects ofthe special rule on the gnatcatcher andits habitat.

The special rule was proposed inrecognition of the significant effortsundertaken by the State of Californiapursuant to the State's NaturalCommunity Conservation Planning Actof 1991 (NCCP) and other ongoing localgovernment multi-species conservationplanning efforts currently beingimp lemented that intend to applyFederal Endangered Species Actstandards to activities affecting thecoastal California gnatcatcheY. Underthe special rule, a limited amount ofincidental take of the gnatcatcher withinsubregions actively engaged inpreparing a NCCP plan would not beconsidered a violation of section 9 of the

Acti provided that the activitiesresulting in such take are conducted inaccordance with the State's NCCPConservation and Process Guidelines.

The alternatives considered includedthe Proposed Special Rule, the ProposedSpecial Rule But with No Interim TakeProcess, and the No Action Alternative.The Proposed Special Rule Alternativewould result in the loss of a maximumof 5 percent of the existing coastal sagescrub habitat, estimated to beapproximately 20,920 acres of coastalsage scrub, and up to 116 pairs ofgnatcatchers would be taken. However,such loss could only occur If long-termconservation planning efforts wereundertaken that would result in thecompletion and implementation ofNCCP plans. Mitigation for the loss ofcoastal sage scrub and gnatcatcherswould be defined by local agencies orsubregional mitigation guidelinesdeveloped according to standardsidentified in the NCCP ProcessGuidelines and consistent with theConservation Guidelines and thestandards imposed under the CaliforniaEnvironmental Quality Act. An internalEndangered Species Act section 7consultation was completed by theService; it is the opinion of the Servicethat the Proposed Action is not likely tojeopardize the continued existence ofthe coastal California gnatcatcher.

The Proposed Special Rule But withNo Interim Take Process and the NoAction Alternatives were not selectedbecause they would diffuse regionalconservation planning efforts andconcentrate activity on individualproject needs. Also, these alternativescould result in adverse impacts to thesocial environment.

Dated: November 23, 1993.Richard N. Smith,Acting Director, Fish and Wildlife Service.[FR Doc. 93-30236 Filed 12-9-93; 8:45 am]BILLING CODE 4310-65-P

65097

Reader Aids Federal Register

Vol. 58, No. 236


INFORMATION AND ASSISTANCE

Federal RegisterIndex, finding aids & general informationPublic inspection deskCorrections to published documentsDocument drafting informationMachine readable documents

Code of Federal RegulationsIndex, finding aids & general informationPrinting schedules

LawsPublic Laws Update Service (numbers, dates, etc.)Additional information

Presidential DocumentsExecutive orders and proclamationsPublic Papers of the PresidentsWeekly Compilation of Presidential Documents

The United States Government ManualGeneral information

Other ServicesData base and machine readable specificationsGuide to Record Retention RequirementsLegal staffPrivacy Act CompilationPublic Laws Update Service (PLUS)TDD for the hearing impaired

202-623-5227523-5215523-6237523-3187523-3447

ELECTRONIC BULLETIN BOARDFree Electronic Bulletin Board service for Public 202-Law numbers, and Federal Register finding aids. or

FEDERAL REGISTER PAGES AND DATES, DEC

63277-63518 ...................... 163519-63884 ...................... 263885-64100 ...................... 364101-64364 ...................... 664365-64454 ...................... 764455-64668 ...................... 864669-64870 ...................... 964871-65098 ..................... 10

CFR PARTS AFFECTED DURING DECEMBER

At the end of each month, the Office of the Federal Registerpublishes separately a List of CFR Sections Affected (LSA), whichlists parts and sections affected by documents published since therevision date of each tte.

1 CFR

11 ..................................... 64871

3 CFR523-6227523-3419 Proclamations:6630 ................................. 632776631 ................................ 632796632 ............................ 63883

523-6641 6633 ................................. 64363523-230 6634 ................................. 64667

Executive Orders:3406 (Revoked In part

523-6230 by PLO 7020) ............... 64166523-5230 12163 (See EO523-6230 12884 ........................... 64099523-6230 12543 (See notice of

December 2) ................ 6436112544 (See Notice of

523-6230 December 2) ................ 6436112748 (Amended by

12883) .......................... 63281523-3447 12883 ............................... 63281523-3187 12884 ............... ....64099523-4534 Admlnlstrstlve Orders:5233187 Memorandums:523-6641 December 1, 1993 ........... 64097523-6229 Presidential Determinations:

No. 94-4 of November19, 1993 ....................... 63519

Notices:275-1538, December 2, 1993.......... 64361275-0920 5CFR

52 . ........................64365

EMBER 831 ................................... 643667 CFR1 ............ ....... 6435354 ..................................... 6466975 ..................................... 64101301 .................................. 64102400 ............... 64872401 ................................... 64873955 ................................... 64103981 ................................... 64105987 ................................... 64103989 ....................... 64106,64107997 ................................... 641091001 ................................. 632831002 ................................. 632831004 ................................. 632831005 ................................. 632831007 ................................. 632831011 ................................. 632831030 ................................. 632831033 ................................. 632831036 ............................ 63231040 ................................. 632831044 ................................. 632831046 ................................. 632831049 ................................. 63283

1065 ................................. 632831068 ................................. 632831075 ................................. 641101079 ................................ 632831093 ................................. 632831094 ................................. 632831096 ................................. 632831097 ................................. 632831098 ................................. 632831099 ................................. 632831106 ................................. 632831108 ................................. 632831124 ................................. 632831126 .............. 632831131 ................................. 63 2831135 ................................. 632831138 ................................. 632831220 ................................. 64 6701951 ................................. 64455Proposed Rules:271 ................................... 64 172981 ................................... 64 1751040 ................................. 64 176

8 CFRProposed Rules:210a ................................. 64695

9 CFR318 ................................... 63521

10 CFR1 ....................................... 6411020 ..................................... 6411030 ..................................... 6411040 ..................................... 6411070 .................................... 6411073 ..................................... 64110Proposed Rules:710 ................................... 64509

11 CFRProposed Rules:100 ................................... 64 190113 ................................... 64190

12 CFR204 ............... 64112303 ................................... 64455332 ................................... 64458333 ................................... 64460362 ................................... 64462Proposed Rules:230 ................................... 64190330 ................................... 64521510 ................................... 64695611 ................................... 64442

13 CFR123 ................................... 64672

14 CFR39 ........... 63523,63524,64112,

Federal Register / Vol. 58, No. 236 1 Friday, December 10, 1993 / Reader Aids

64114,64487,64874,64875, 655 ................................... 65084 37 CFR64877

71 ........... 63293, 63885, 63886, 24 CFR 1........... 64154, 641552 ....................................... 64 15464116,64117,64444,64488, 219 ................................... 64138 5 ....................................... 64155

64879,64880 246 ................................... 64032 10 ......................... 64154, 64155158 ............... 64118 266 ............... 64032 304 ............... 63294Proposed Rules: 905 ................................... 6414125 ..................................... 64700 970 ................................... 64141 38 CFR31 ..................................... 64450 Proposed Rules: 21 ..................................... 6352933 ..................................... 63902 300 ................................... 6471339 ........... 63305.63307,64198, 310 ............... 64713 39 CFR

64199,64200,64386,64705, 390 ................................... 64713 Proposed Rules:64707, 64708 3500 ................................. 64066 ill, .................................. 64918

71 ........... 63308, 63309, 63903,63904,63905,63906,64387, 26 CFR 40 CFR

64525,64710 1 ....................................... 64897 35 ..................................... 6387673 ..................................... 63908 Proposed Rules: 52 ........... 64155, 64157, 64158,15CFR 301 ................................... 63541 64161,6467860 ..................................... 64158771 ................................... 64674 30 CFR 81 ......................... 64161,64490799 ................................... 64674 50 ..................................... 63528 82 ..................................... 65018946 ................................... 64088 70 ..................................... 63528 88 ..................................... 64679Proposed Rules: 71 ..................................... 63528 144 ................................... 63890946 ................................... 64202 90 ..................................... 63528 146 ................................... 63890

207 ................................... 64899 180... ..... 63294, 64492, 64493,16 CFR 208 ................................... 64899 64495,64496228 ................................... 64881 210 ................................... 64899 228 ................................. 644971000 ................................. 64119 216 ................................... 64899 300 ................................... 63531Proposed Rules: 218 ................................... 64899 372 ....................... 63496, 63500307 ................................... 63488 219 ................................... 64899 721 ................................... 63500309 ................................... 64914 220 ................................... 64899 Proposed Rules:1303 ................................. 63311 228 ................................... 64899 52 ........... 63316, 63545, 63547,

229 ................................... 64899 63549,6453017 CFR 243 ................................... 64899 80 ..................................... 64213

200 ................................... 64120 925 ................................... 64142 180 ....................... 64536, 64538204 ................................... 64369 936 ................................... 64374 300 ....................... 63551, 64539270 ................................... 64353 938 ................................... 64151 41 CFR

Proposed Rules:18 CFR 906 ................................... 64210 101-39 ............................. 63631

Proposed Rules: 914 ................................... 64212 Proposed Rules:141 ............... 63312 934 ...............64528 201-3 ............. 64389388 ................................... 63312 944 ................................... 64529 201-4...., ......................... 64389

Proposed Rules: 201-9 ............................... 6438919 CFR 700 ................................... 63316 201-11 ............................. 64389

201 ............... 64120 701 ............... 63316 201-18 ............ 64389Rules: 705 ................................... 63316 201-20 ............................. 64389

Proposed Rules: 706 ................................... 63316 201-21 ........................ 64389210 ............... 64711 715 ................................... 63316 201-22 ............................. 64389

20 CFR 716 ................................... 63316 201-23 ............................. 64389785 ................................... 63316 201-24 ............ 64389404 .............. 64121, 825 ................................... 63316 201-39 ............................. 64389

64882, 64883, 64886, 64890 870 ................................... 63316416 .................................. 63887, 42 CFR

63888, 64883, 64892, 64893 31 CFR 405 ................................... 63626Proposed Rules: 317 ................................... 63529 414 .................................. 63626404 ............... 64207 590 ............... 64904 491 ............... 63533416 ................................... 64207 Proposed Rules:

32 CFR 67 ..................................... 6390921 CFR 95 ..................................... 632935 ................ 64489 706 ............... 64678 43 CFR100 ................................... 64123 Proposed Rules: Public Land Orders:178 ................................... 64894 2 ....................................... 63542 7012 ................................. 64498510 ................................... 63890 7013 ................................. 64165558 ................................... 63890 33 CFR 7014 ................................. 644981220 ................................. 64137 66 ..................................... 64153 7015 ................................. 64499Proposed Rules: 334 ................................... 64383 7016 ................................. 64499100 ................................... 64208 Proposed Rules: 7017 ................................. 64692.179 ................................... 64526 156 ................................... 63544 7018 ................................. 64692812 ................................... 64209 7019 ................................. 64693813 ................................... 64209 34 CIFR 7020 ................................. 64166820 ................................... 64353 Proposed Rules: Proposed Rules:23 CFR 647 ................................... 63870 426 ................................... 64277

500 ....................... 63442, 64374 36 CFR Group 3400 ......... 64919,625 ................................... 64895 Proposed Rules: 44 CFR626 ....................... 63422, 64374 1220 ................................. 64915 64 ..................................... 63899

45 CFR400 ................................... 64499Proposed Rules:1370 ................................. 64920

46 CFR232 ................................... 64798585 ................................... 64909Proposed Rules:12 ..................................... 6427816 ..................................... 64278

47 CFR63 ..................................... 6416773 ............ 63295, 63296, 6353676 ..................................... 6416897 ..................................... 64384Proposed Rules:15 ..................................... 6454163 ..................................... 6428073 ........... 63318, 63319, 63320,

63321,6355376 ..................................... 64541

48 CFR232 .................................. 64353501 ................................... 64 693509 .............................. 64693552 ................................... 64693Proposed Rules:9 ....................................... 634 9415 ..................................... 6482452 ............ 63492, 63494, 64826904 ................................... 63553917 ................................... 63553936 ................................... 63553939 ................................... 63556943 ................................... 63553952 ................................... 63553970 .................................. 63553

49 CFR541 ................................... 63296544 ................................... 63299571 ....................... 63302, 64168.614 ....................... 63442, 64374Proposed Rules:396 ................................... 64923571 ................................... 63321583 ................................... 63327659 ................................... 648561312 ................................. 64717

50 CFR216 ................................... 6353617 ..................................... 65088663 ................................... 64 169Proposed Rules:17 ........... 63328, 63560, 64281,

64828,64927,6509720 ..................................... 6348821 ..................................... 63488215 ................................... 64285216 ................................... 64285222 ................................... 64285611 ................................... 64798625 ................................... 64393650 ................................... 63329672 .................................. 64798

ii 4

Federal Register / Vol. 58, No. 236 / Friday, December 10, 1993 / Reader Aids iii

LIST OF PUBUC LAWS

Note: No public bills whichhave become law were

received by the Office of theFederal Register for InclusionIn today's List of PublicLaws.Last List December 9, 1993

Federal Register - Pipeline and Hazardous Materials Safety ...

Documents

Transcript of Federal Register - Pipeline and Hazardous Materials Safety ...