Friday January 27, 1995 - GovInfo

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FridayJanuary 27, 1995Vol. 60 No. 18

Pages 5309–5558

1–27–95

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Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995

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Contents Federal Register

III

Vol. 60, No. 18

Friday, January 27, 1995

Agriculture DepartmentSee Federal Crop Insurance CorporationSee Food and Consumer ServiceSee Forest Service

Blind or Severely Disabled, Committee for Purchase FromPeople Who Are

See Committee for Purchase From People Who Are Blind orSeverely Disabled

Coast GuardPROPOSED RULESDrawbridge operations:

New York, 5343–5344Pollution:

Gulf of Mexico; lightering zones designation; meetingCorrection, 5461

NOTICESEnvironmental statements; availability, etc.:

Differential global positioning systems—Atlantic Intercoastal Region, 5453–5454

High frequency Morse radiotelegraphy services;discontinuance, 5454

Meetings:Areas to be avoided off Washington Coast, 5454–5455

Commerce DepartmentSee International Trade AdministrationSee National Institute of Standards and TechnologySee National Oceanic and Atmospheric AdministrationSee Technology Administration

Committee for Purchase From People Who Are Blind orSeverely Disabled

NOTICESProcurement list; additions and deletions, 5372–5373

Committee for the Implementation of Textile AgreementsNOTICESCotton, wool, and man-made textiles:

Bangladesh, 5371–5372Export visa requirements; certification, waivers, etc.:

Bangladesh, 5372

Commodity Futures Trading CommissionNOTICESMeetings; Sunshine Act, 5459

Competitiveness Policy CouncilNOTICESMeetings, 5373

Customs ServiceRULESOrganization and functions; field organization, ports of

entry, etc.:Hilo and Kahului, HI; port limits extension, 5312–5313

NOTICESUruguay Round Agreements Act; textile and apparel

products; contract and certification filing procedures,5457–5458

Education DepartmentNOTICESSpecial education and rehabilitative services:

Blind vending facilities under Randolph-Sheppard Act—Arbitration panel decisions, 5373–5374

Employment and Training AdministrationNOTICESAdjustment assistance:

DG&E/Slocum L.P. et al., 5438Intera Information Technologies, Inc., 5438Kane Industries et al., 5438–5439MagneTek, 5439McKay Drilling Co., Inc., 5440Melnor, Inc., et al., 5439–5440Niagara Mohawk Power Corp., 5440Phillips-Van Heusen Warehouse & Distribution Center,

5440–5441Texaco Exploration & Production, Inc., 5441

Employment Standards AdministrationNOTICESMinimum wages for Federal and federally-assisted

construction; general wage determination decisions,5437–5438

Energy DepartmentSee Federal Energy Regulatory CommissionNOTICESEnvironmental statements; availability, etc.:

Oak Ridge, TN—East Fork Poplar Creek Remedial Action Project, 5374–

5375

Environmental Protection AgencyRULESAir pollutants, hazardous; national emission standards:

Synthetic organic chemical manufacturing industry andother processes subject to equipment leaks negotiatedregulation, 5320–5321

Air quality implementation plans; approval andpromulgation; various States:

Illinois, 5318–5320Montana, 5313–5318

PROPOSED RULESAir quality implementation plans; approval and

promulgation; various States:Illinois, 5345Montana, 5345

Clean Air Act:Enhanced monitoring programs, 5344–5345

Water pollution; effluent guidelines for point sourcecategories:

Centralized waste treatment, 5464–5506NOTICESEnvironmental statements; availability, etc.:

Agency statements—Comment availability, 5387–5388Weekly receipts, 5388–5389

Joint water pollution control plant, Carson, CA; upgradeto full secondary treatment, 5389

Port Everglades, FL; offshore ocean dredged materialdisposal site designation, 5389–5390

IV Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Contents

Water pollution control:National pollutant discharge elimination system; State

programs—Florida, 5390–5391

Farm Credit AdministrationNOTICESMeetings; Sunshine Act, 5459

Federal Communications CommissionRULESOrganization, functions, and authority delegations:

International Bureau, 5322–5333Personal communications services:

Licenses in 2 GHz band (broadband PCS)Competitive bidding; ‘‘entrepreneurs’ blocks;’’

correction, 5333–5336

Federal Crop Insurance CorporationPROPOSED RULESCrop insurance regulations:

Nursery crop, 5339–5343

Federal Deposit Insurance CorporationNOTICESMeetings; Sunshine Act, 5459–5460

Federal Energy Regulatory CommissionNOTICESElectric rate and corporate regulation filings:

Medina Power Co. et al., 5375–5377Southwestern Public Service Co. et al., 5377–5378

Environmental statements; availability, etc.:Southern California Edison Co., 5378–5379

Hydroelectric applications, 5379–5384Natural gas certificate filings:

Texas Eastern Transmission Corp. et al., 5384–5385Williams Natural Gas Co. et al., 5385–5387

Thunder Bay Power Co.; National Register of HistoricPlaces; restricted service list for programmaticagreement for managing properties, 5387

Applications, hearings, determinations, etc.:East Tennessee Natural Gas Co., 5387

Federal Highway AdministrationNOTICESTransportation decisionmaking, public involvement; policy

and questions and answers, 5508–5512

Federal Maritime CommissionRULESOrganization, functions, and authority delegations:

Managing Director’s Office; correction, 5322NOTICESAgreements filed, etc., 5391

Federal Mediation and Conciliation ServiceNOTICESGrants and cooperative agreements; availability, etc.:

Labor-management cooperation program, 5391–5394

Federal Mine Safety and Health Review CommissionNOTICESMeetings; Sunshine Act, 5460

Federal Reserve SystemNOTICESAgency information collection activities under OMB

review, 5394–5395

Applications, hearings, determinations, etc.:MNB Corp. et al., 5395–5396National Bancorp, Inc., 5396Norwest Corp. et al., 5396–5397Staley, John William, 5397

Federal Trade CommissionNOTICESProhibited trade practices:

Del Monte Foods Co. et al., 5397–5401HEALTHSOUTH Rehabilitation Corp., 5401–5408Lockheed Corp. et al., 5408–5414Montedison S.p.A. et al., 5414–5428Sensormatic Electronics Corp., 5428–5431

Federal Transit AdministrationNOTICESTransportation decisionmaking, public involvement; policy

and questions and answers, 5508–5512

Fish and Wildlife ServiceNOTICESVirgin spinedace; conservation agreement, 5435

Food and Consumer ServicePROPOSED RULESChild nutrition programs:

National school breakfast and lunch programs—Compliance with Dietary Guidelines for Americans;

meeting, 5514–5527Nutrition objectives for school meals, 5527–5528

Food and Drug AdministrationRULESHuman drugs:

Dandruff, seborrheic dermatitis, and psoriasis products(OTC)—

Menthol; CFR correction, 5313PROPOSED RULESPublic information:

Communications with State and foreign governmentofficials, 5530–5540

NOTICESMedical devices; premarket approval:

Precision UV (Vasurfilcon A) Hydrophilic Contact Lensfor extended wear, 5431–5432

Forest ServiceNOTICESEnvironmental statements; availability, etc.:

Tongass National Forest, AK, 5347–5348

Health and Human Services DepartmentSee Food and Drug AdministrationSee Public Health ServiceSee Social Security Administration

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

Facilities to assist homeless—Excess and surplus Federal property, 5434

Innovative homeless initiatives demonstration program,5434–5435

Interior DepartmentSee Fish and Wildlife ServiceSee Land Management Bureau

VFederal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Contents

International Trade AdministrationNOTICESAntidumping:

Small diameter circular seamless carbon and alloy steel,standard, line and pressure pipe from—

Argentina, 5348–5351Brazil, 5351–5355Germany, 5355–5358Italy, 5358–5361

Meetings:Automotive Parts Advisory Committee, 5361–5362

Interstate Commerce CommissionNOTICESMotor carriers:

Compensated intercorporate hauling operations, 5435–5436

Railroad services abandonment:CSX Transportation, Inc., 5436

Justice DepartmentSee Juvenile Justice and Delinquency Prevention OfficeSee Parole CommissionRULESAmericans with Disabilities Act; implementation:

Nondiscrimination on basis of disability—Public accommodations and commercial facilities; CFR

correction; correction, 5461NOTICESPrivacy Act:

Computer matching programs, 5436–5437

Juvenile Justice and Delinquency Prevention OfficeNOTICESMeetings:

Coordinating Council, 5437

Labor DepartmentSee Employment and Training AdministrationSee Employment Standards Administration

Land Management BureauRULESPublic land orders:

California, 5321–5322

Mine Safety and Health Federal Review CommissionSee Federal Mine Safety and Health Review Commission

National Highway Traffic Safety AdministrationRULESMotor vehicle safety standards:

School bus pedestrian safety devices; flash rate for stopsignal arm lamps, 5336–5337

PROPOSED RULESMotor vehicle safety standards:

Occupant crash protection—Use of lap belts in new vehicles with automatic safety

belts; manufacturer warning requirement; petitiondenied, 5345–5346

NOTICESMotor vehicle safety standards:

Nonconforming vehicles—Importation eligibility; determinations, 5455–5456

National Institute of Standards and TechnologyNOTICESInformation processing standards, Federal:

Programmer’s hierarchical interactive graphics system,5362–5368

VHSIC hardware description language, 5368–5370

National Oceanic and Atmospheric AdministrationRULESFishery conservation and management:

Gulf of Alaska groundfish, 5337–5338Gulf of Mexico shrimp; correction, 5461

Nuclear Regulatory CommissionNOTICESOrganization, functions, and authority delegations:

Local public document room relocation andestablishment—

U.S. Enrichment Corporation’s gaseous diffusionplants, KY and OH, 5441

Applications, hearings, determinations, etc.:Entergy Operations, Inc., 5441–5443

Parole CommissionRULESFederal prisoners; paroling and releasing, etc.:

Controlled substances; mandatory drug testing forparolees; correction, 5461

Personnel Management OfficeRULESPrevailing rate systems, 5309–5312Federal employees’ group life insurance and Federal

employees health benefits programs, correction, 5461PROPOSED RULESPerformance management and incentive awards;

deregulation, 5542–5557

Public Health ServiceSee Food and Drug AdministrationNOTICESAgency information collection activities under OMB

review, 5432–5433

Securities and Exchange CommissionRULESProposed rule changes of self-regulatory organizations:

Annual filings of amendments to registration statements,corrections, 5461

NOTICESSelf-regulatory organizations; proposed rule changes:

Depository Trust Co., 5443–5444Midwest Clearing Corp., 5444–5445Midwest Clearing Corp. et al., 5445–5446National Association of Securities Dealers, 5446–5449Philadelphia Stock Exchange, Inc., 5449–5450

Applications, hearings, determinations, etc.:Public utility holding company filings, 5450–5452

Small Business AdministrationNOTICESAgency information collection activities under OMB

review, 5452–5453License surrenders:

Wood River Capital Corp., 5453

VI Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Contents

Social Security AdministrationNOTICESMeetings:

Social Security Advisory Council, 5433–5434

Technology AdministrationNOTICESMeetings:

Metric Policy Interagency Council and CommerceDepartment; metric town meeting, 5370–5371

Textile Agreements Implementation CommitteeSee Committee for the Implementation of Textile

Agreements

Transportation DepartmentSee Coast GuardSee Federal Highway AdministrationSee Federal Transit AdministrationSee National Highway Traffic Safety Administration

Treasury DepartmentSee Customs ServiceNOTICESAgency information collection activities under OMB

review, 5456–5457

Separate Parts In This Issue

Part IIEnvironmental Protection Agency, 5464–5506

Part IIIDepartment of Transportation, Federal Highway

Administration and Federal Transit Administration,5508–5512

Part IVDepartment of Agriculture, Food and Consumer Service,

5514–5528

Part VDepartment of Health and Human Services, Food and Drug

Administration, 5530–5540

Part VIOffice of Personnel Management, 5542–5557

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, Federal Register finding aids, and a list ofdocuments on public inspection is available on 202–275–1538 or 275–0920.

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.

VIIFederal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Contents

5 CFR532 (2 documents) ...........5309,

5312870.....................................5461871.....................................5461872.....................................5461873.....................................5461874.....................................5461890.....................................5461Proposed Rules:430.....................................5542432.....................................5542451.....................................5542531.....................................5542

7 CFRProposed Rules:210 (2 documents) ...........5514,

5527220 (2 documents) ...........5514,

5527457.....................................5339

17 CFR240.....................................5461

19 CFR101.....................................5312

21 CFR310.....................................5313Proposed Rules:20.......................................5530

28 CFR2.........................................546136.......................................5461

33 CFRProposed Rules:117.....................................5343156.....................................5461

40 CFR52 (2 documents) .............5313,

531863.......................................5320

40 CFRProposed Rules:51.......................................534452 (3 documents) .............5344,

534560.......................................534461.......................................534464.......................................5344437.....................................5464

43 CFRPublic Land Order:7113...................................5321

46 CFR501.....................................5322

47 CFR0.........................................53221.........................................532224.......................................533325.......................................532243.......................................532264.......................................532273.......................................5322

49 CFR571.....................................5336Proposed Rules:571.....................................5345

50 CFR658.....................................5461672 (2 documents) ...........5337,

5338

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.

Rules and Regulations Federal Register

5309

Vol. 60, No. 18


OFFICE OF PERSONNELMANAGEMENT

5 CFR Part 532

RIN 3206–AG12

Prevailing Rate Systems; Special WageSchedules for Supervisors ofNegotiated Rate Bureau ofReclamation Employees

AGENCY: Office of PersonnelManagement.ACTION: Final rule.

SUMMARY: The Office of PersonnelManagement is issuing a final rule toestablish special wage schedules for thesupervisors of certain Bureau ofReclamation, Department of the Interior,employees who negotiate their wagerates.EFFECTIVE DATE: February 27, 1995.FOR FURTHER INFORMATION CONTACT:Paul Shields, (202) 606–2848.SUPPLEMENTARY INFORMATION: OnSeptember 7, 1994, at 59 FR 46201, theOffice of Personnel Management (OPM)published a proposed rule to establishspecial wage schedules for thesupervisors of certain Bureau ofReclamation, Department of the Interior,employees who negotiate their wagerates, with a 30-day comment period.During the comment period, whichended October 7, 1994, OPM receivedcomments from a local union officer andsix employees.

Discussion of Comments

1. The local union officer and twoemployees said they thought the newspecial schedule system would beexpensive and recommended that thecurrent process of linking the pay ofsupervisors with bargaining unit rates ofpay be continued or modified.

We do not agree with thesecomments. This new special scheduleproposal was developed by the Bureau

of Reclamation working in partnershipwith the covered supervisors andreflects agreements reached in thosediscussions. When the agency removedthe supervisors from the bargainingunits in 1990, the only pay systemavailable was the Federal Wage System(FWS) under the provisions of title 5,United States Code. The agencyreceived authority to temporarilycontinue (as an agency ‘‘set-aside’’practice) the historical pay differentialsat each location, subject to the statutorypay limitations of the FWS. Pay settingfor these supervisors is complicated bythe combined factors of wagenegotiations for bargaining unitemployees, delays in those negotiations,pay limitation statutes, and FWSlocality pay rates. The purpose of thisspecial schedule is to eliminate, in thepay-setting process for thesesupervisors, the dependence onnegotiated rates for the bargaining unitand the associated complications ofdelays in negotiations.

Based on the information currentlyavailable, the proposed special schedulewill not result in a significant increasein operating costs. Under the newsurvey process, the special wage surveyfor supervisors will be timed to coincidewith the annual survey that is done forbargaining unit employees. The surveyswill be done at the same time withmany of the same firms being surveyedfor both purposes. The special wagesurvey committees and data collectorpersonnel will be the same, with a fewadditions for the supervisory survey.

2. Several questions were raised abouthow special wage area boundaries wereset up. Special wage area boundarieswere generally established tocorrespond to the boundaries currentlybeing used for the wage surveys forbargaining unit employees. However, insome cases, areas were consolidatedeither because of the desire to simplifythe survey and wage setting process, thegeographic location of the Bureau ofReclamation projects, the desire topermit use of the same survey companyin more than one project, or thesimilarity of the rates being paid to theBureau of Reclamation supervisors inconsolidated areas.

Three employees recommended thatthe survey area for the Hungry HorseProject Office be extended to includePend Oreille County, Washington,which would include Boundary Dam, a

facility of Seattle City Light Company.As a city government facility, BoundaryDam does not meet the statutory FWSrequirement that only private industrycompanies be surveyed. However, sincePend Oreille County is within thesurvey area used for the bargaining unitemployees, and the Bureau ofReclamation is attempting to coordinatesurveys for the supervisors with those ofthe bargaining unit, we have addedPend Oreille County to the HungryHorse Project Office survey area. Thiswill also facilitate the process in thefuture should the local area surveycommittee need to add private industrysurvey companies in that county.

3. The local union officer and threeemployees commented on the industriesand companies to be included in thespecial surveys. The union suggestedthat only unionized companies besurveyed. We do not agree with thissuggestion because under statutes andregulations, FWS pay-setting is based ona determination of private industryprevailing rates, regardless of unionorganization. The three employeesexpressed concern that private industryelectric utility and hydro-electriccompanies would not be included in thesurveys. No changes in the regulationare needed. These industries areexpressly included by the regulation at§ 532.285(c)(1) (Standard IndustrialClassification Major Group 49—Electric,Gas, and Sanitary Services).

4. Two employees expressed concernthat the survey jobs being used in thespecial surveys would not cover jobs inlarge hydro-electric facilities with multi-crafts. We do not feel a change isnecessary. This special schedule processtakes into account the number of craftssupervised and the range of worksupervised through application of theclassification criteria found in Factor 1and Subfactor IIIA of the FWS JobGrading Standard for Supervisors. Thesejob aspects are covered by SubfactorIIIA, Scope of Assigned Work Functionand Organizational Authority, whichaddresses aspects reflecting the varietyof crafts and the range of work. Forexample, at Level A–4, the scope anddiversity of work supervised isaddressed. Similarly, one of theelements used in distinguishing thedifference among situations in Factor 1,Nature of Supervisory Responsibility, isthe number of levels of supervisionthrough which work activities are

5310 Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Rules and Regulations

controlled. More levels of supervisiontend to be associated with a greaternumber of crafts supervised.

One employee asked how the fourlevels for Supervisors I–IV fit into thesurvey process. As explained in§ 532.285 (b) and (c)(3) of the finalregulation, survey jobs representingpositions at up to four levels will betailored to correspond to the positionsof each covered supervisor in that area.They will be matched to privateindustry jobs in each special wage area.Special schedule rates for each positionwill be based on prevailing rates for thatparticular job in private industry. Thespecial survey and wage schedule for agiven area includes only thoseoccupations and levels havingemployees in that area. The regulationwas not changed in this respect.

5. An employee expressed concernthat current supervisors would not beadequately compensated for theirexperience upon conversion to the newspecial schedule as compared to newlyhired supervisors. The new specialschedule provides special considerationto current supervisors in the first year ofimplementation. Under § 532.285(f)(2),current supervisors are placed in step 2of the new special schedule, unless theirrate of pay exceeds step 2, in which casethey will be placed in step 3. Payretention benefits will apply to anyemployee whose current rate of payexceeds step 3. New employees willenter at step 1 of the grade, unless ahigher rate is established in accordancewith the advanced in-hire rateprocedure. The new special scheduleprovides added compensation for theexperience of current employees, and nochanges are necessary.

6. Two employees recommended thatthe definition of compensationmeasured in industry surveys beexpanded to include other companybenefits, such as a company vehiclewith gas provided to get to and fromwork, paid insurance coverage,company housing, and company stockpurchase options. The regulation willnot be modified in this regard. UnderFWS statutes and practices, surveyedwages do include certain bonuses,incentive rates, and cost of livingallowances. Surveying the additionalbenefits suggested would require achange in the law.

7. Finally, one employee commentedthat while the beginning month of thesurvey for each special area is specifiedin the rule, implementation or effectivedates for the new schedules are notspecified. No change is necessarybecause, as with the regular FWS,beginning dates for the special surveysare specified in the regulation, and by

statute (5 U.S.C. 5344(a)) increases inrates of pay are effective not later thanthe first day of the first pay periodbeginning on or after the 45th dayfollowing the date the survey is orderedto be made.

Other ChangesThe special schedule survey cycle in

this rule has been changed from 3 yearsto 2 years because it has beendetermined that the 3-year proposalexceeded OPM’s regulatory flexibility.The prevailing rate law grants OPMgreat flexibility to establish specialschedules that differ from regularschedules in terms of wage areaboundaries; industrial, geographic, andoccupational survey coverage; step ratestructures; and wage rate progressions.However, the regulatory flexibility toadjust the normal 2-year survey cycleallows only for more frequent, not lessfrequent full-scale surveys.

In § 532.285(f)(1), the reference to‘‘fiscal year 1995’’ has been deletedbecause this final rule will not beeffective until well into the fiscal year.

Regulatory Flexibility ActI certify that these regulations will not

have a significant economic impact ona substantial number of small entitiesbecause they will affect only Federalagencies and employees.

List of Subjects in 5 CFR Part 532Administrative practice and

procedure, Freedom of information,Government employees, Reporting andrecordkeeping requirements, Wages.Office of Personnel Management.Lorraine A. Green,Deputy Director.

Accordingly, OPM is amending 5 CFRpart 532 as follows:

PART 532—PREVAILING RATESYSTEMS

1. The authority citation for part 532continues to read as follows:

Authority: 5 U.S.C. 5343, 5346; § 532.707also issued under 5 U.S.C. 552.

2. Subpart B is amended by adding§ 532.285 to read as follows:

§ 532.285 Special wage schedules forsupervisors of negotiated rate Bureau ofReclamation employees.

(a) The Department of the Interiorshall establish and issue special wageschedules for wage supervisors ofnegotiated rate wage employees in theBureau of Reclamation. These schedulesshall be based on annual special wagesurveys conducted by the Bureau ofReclamation in each special wage area.Survey jobs representing Bureau of

Reclamation positions at up to fourlevels will be matched to privateindustry jobs in each special wage area.Special schedule rates for each positionwill be based on prevailing rates for thatparticular job in private industry.

(b) Each supervisory job shall bedescribed at one of four levelscorresponding to the four supervisorysituations described in Factor I and fourlevels of Subfactor IIIA of the FWS JobGrading Standard for Supervisors. Theyshall be titled in accordance withregular FWS practices, with the addeddesignation of level I, II, III, or IV. Thespecial survey and wage schedule for agiven special wage area includes onlythose occupations and levels havingemployees in that area. For eachposition on the special schedule, thereshall be three step rates. Step 2 is theprevailing rate as determined by thesurvey; step 1 is 96 percent of theprevailing rate; and step 3 is 104 percentof the prevailing rate.

(c) For each special wage area, theBureau of Reclamation shall designateand appoint a special wage surveycommittee, including a chairperson andtwo other members (at least one ofwhom shall be a supervisor paid fromthe special wage schedule), and one ormore two-person data collection teams(each of which shall include at least onesupervisor paid from the special wageschedule). The local wage surveycommittee shall determine theprevailing rate for each survey job as aweighted average. Survey specificationsare as follows for all surveys:

(1) Tailored to the Bureau ofReclamation activities and types ofsupervisory positions in the specialwage area, private industry companiesto be surveyed shall be selected fromamong the following Standard IndustrialClassification Major Groups: 12 coalmining; 13 oil and gas extraction; 14mining and quarrying of nonmettalicminerals, except fuels; 35manufacturing industrial andcommercial machinery and computerequipment; 36 manufacturing electronicand other electrical equipment andcomponents, except computerequipment; 42 motor freighttransportation and warehousing; 48communications; 49 electric, gas, andsanitary services; and 76 miscellaneousrepair services. No minimumemployment size is required forsurveyed establishments.

(2) Each local wage survey committeeshall compile lists of all companies inthe survey area known to have potentialjob matches. For the first survey, allcompanies on the list will be surveyed.Subsequently, companies shall beremoved from the survey list if they

5311Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Rules and Regulations

prove not to have job matches, and newcompanies will be added if they areexpected to have job matches. Surveydata will be shared with other localwage survey committees when the datafrom any one company is applicable tomore than one special wage area.

(3) For each area, survey jobdescriptions shall be tailored tocorrespond to the position of eachcovered supervisor in that area. Theywill be described at one of four levels(I, II, III, or IV) corresponding to thedefinitions of the four supervisorysituations described in Factor I and fourlevels of Subfactor IIIA of the FWS JobGrading Standard for Supervisors. Adescription of the craft, trade, or laborwork supervised will be included ineach supervisory survey job description.

(d) Special wage area boundaries shallbe identical to the survey areas coveredby the special wage surveys. The areasof application in which the specialschedules will be paid are generallysmaller than the survey areas, reflectingactual Bureau of Reclamation worksitesand the often scattered location ofsurveyable private sector jobs. Specialwage schedules shall be established inthe following areas:

The Great Plains Region

Special Wage Survey Area (Counties)Montana: All counties except Lincoln,

Sanders,Lake, Flathead, Mineral, Missoula,Powell, Granite, and Ravalli

Wyoming: All counties except Lincoln,Teton, sublette, Uinta, and Sweetwater

Colorado: All counties except Moffat, RioBlanco, Garfield, Mesa, Delta, Montrose,San Miguel, Ouray, Delores, San Juan,Montezuma, La Plata, and Archuleta

North Dakota: All countiesSouth Dakota: All counties

Special Wage Area of Application (Counties)

Montana: Broadwater, Jefferson,Lewis andClark, Yellowstone, and Bighorn Counties

Wyoming: All counties except Lincoln,Teton, Sublette, Uinta, and Sweetwater

Colorado: Boulder, Chaffee, Clear Creek,Eagle, Fremont, Gilpin, Grand, Lake,Larimer, Park, Pitkin, Pueblo, and Summitt

Beginning month of survey: August

The Mid-Pacific Region

Special Wage Survey Area (Counties)

California: Shasta, Sacramento, Butte, SanFrancisco, Merced, Stanislaus


California: Shasta, Sacramento, Fresno,Alameda, Tehoma, Tuolumne, Merced

Beginning month of survey: October

Green Springs Power Field Station


Oregon: Jackson


Oregon: Jackson

Beginning month of survey: April

Pacific NW. Region Drill Crew


Montana: Flathead, MissoulaOregon: Lane, Bend, Medford, Umatilla,

MultnomahUtah: Salt LakeIdaho: Ada, Canyon, AdamsWashington: Spokane, Grant, Lincoln,

Okanogan


Oregon: Deschutes, Jackson, UmatillaMontana: MissoulaIdaho: AdaWashington: Grant, Lincoln, Douglas,

Okanogan, YakimaBeginning month of survey: April

Snake River Area Office (Central Snake/Minidoka)


Idaho: Ada, Caribou, Bingham, Bannock


Idaho: Gem, Elmore, Bonneville, Minidoka,Boise, Valley, Power


Hungry Horse Project Office


Montana: Flathead, Missoula, Cascade,Sanders, Lake

Idaho: BonnerWashington: Pend Oreille


Montana: FlatheadBeginning month of survey: March

Grand Coulee Power Office (Grand CouleeProject Office)


Oregon: MultnomahWashington: Spokane, King


Washington: Grant, Douglas, Lincoln,Okanogan


Upper Columbia Area Office (Yakima)


Washington: King, YakimaOregon: Multnomah


Washington: YakimaOregon: UmatillaBeginning Month of Survey: September

Colorado River Storage Project Area


Arizona: Apache, Coconino, NavajoColorado: Moffat, Montrose, Routt,

Gunnison, Rio Blanco, Mesa, Garfield,Eagle, Delta, Pitkin, San Miguel, Delores,Montezuma, La Plata, San Juan, Ouray,Archuleta, Hindale, Mineral

Wyoming: Unita, Sweetwater, Carbon,Albany, Laramie, Goshen, Platte, Niobrara,

Converse, Natrona, Fremont, Sublette,Lincoln

Utah: Beaver, Box Elder, Cache, Carbon,Daggett, Davis, Duchesne, Emery, Garfield,Grand, Iron, Juab, Kane, Millard, Morgan,Piute, Rich, Salt Lake, San Juan, Sanpete,Sevier, Summit, Tooele, Uintah, Utah,Wasatch, Washington, Wayne, Weber

Special Survey Area of Application(Counties)

Arizona: CoconinoColorado: Montrose, Gunnison, MesaWyoming: LincolnUtah: DaggettBeginning month of survey: March

Elephant Butte Area


New Mexico: Grant, Hidalgo, Luna, DonaAna, Otero, Eddy, Lea, Roosevelt, Chaves,Lincoln, Sierra, Socorro, Catron, Cibola,Valencia, Bernalillo, Torrance, Guadalupe,De Baca, Curry, Quay

Texas: El Paso, Hudspeth, Culberson, JeffDavis, Presido, Brewster, Pecos, Reeves,Loving, Ward, Winkler

Arizona: Apache, Greenlee, Graham, Cochise


New Mexico: SierraBeginning month of survey: June

Lower Colorado Dams Area


Nevada: ClarkCalifornia: Los AngelesArizona: Maricopa


Nevada: ClarkCalifornia: San BernardinoArizona: MohaveBeginning month of survey: August

Yuma Projects Area


California: San DiegoArizona: Maricopa, Yuma

(Note: Bureau of Reclamation may addother survey counties for dredge operatorsupervisors because of the uniqueness of theoccupation and difficulty in finding jobmatches.)


Arizona: YumaBeginning month of survey: November

(Maintenance) and April (Dredging)

Bureau of Reclamation, Denver, CO, Area


Colorado: Jefferson, Denver, Adams,Arapahoe, Boulder, Larimer

Special Wage Survey Area of Application(Counties)

Colorado: JeffersonBeginning month of survey: February

(e) These special schedule positionswill be identified by pay plan code XE,grade 00, and the Federal Wage Systemoccupational codes will be used. Newemployees shall be hired at step 1 of the


position. With satisfactory or higherperformance, advancement betweensteps shall be automatic after 52 weeksof service.

(f) (1) In the first year ofimplementation, all special areas willhave full-scale surveys.

(2) Current employees shall be placedin step 2 of the new special schedule,or, if their current rate of pay exceedsthe rate for step 2, they shall be placedin step 3. Pay retention shall apply toany employee whose rate of basic paywould otherwise be reduced as a resultof placement in these new special wageschedules.

(3) The waiting period for within-grade increases shall begin on theemployee’s first day under the newspecial schedule.

[FR Doc. 95–2013 Filed 1–26–95; 8:45 am]BILLING CODE 6325–01–M

5 CFR Part 532

RIN 3206–AG53

Prevailing Rate Systems; Abolishmentof New York, New York, Special WageSchedules for Printing Positions

AGENCY: Office of PersonnelManagement.ACTION: Interim rule with request forcomments.

SUMMARY: The Office of PersonnelManagement is issuing interimregulations to abolish the Federal WageSystem special wage schedule forprinting positions in the New York,New York, wage area. Printing andlithographic employees in New York,New York, will now be paid rates fromthe regular New York, New York, wageschedule.DATES: This interim rule becomeseffective on January 27, 1995.Comments must be received byFebruary 27, 1995. Employees paid ratesfrom the New York, New York, specialwage schedule for printing positionswill continue to be paid from thatschedule until their conversion to theregular New York, New York, wageschedule effective on the first day of thefirst full pay period beginning on orafter January 27, 1995.ADDRESSES: Send or deliver commentsto Donald J. Winstead, AssistantDirector for Compensation Policy,Personnel Systems and OversightGroup, U.S. Office of PersonnelManagement, Room 6H31, 1900 E StreetNW., Washington, DC 20415.FOR FURTHER INFORMATION CONTACT:Paul Shields, (202) 606–2848.

SUPPLEMENTARY INFORMATION: TheDepartment of Defense recommended tothe Office of Personnel Managementthat the New York, New York, Printingand Lithographic wage schedule beabolished and that the regular NewYork, New York, wage schedule applyto printing employees in the New York,New York, wage area. Thisrecommendation was based on the factthat the New York, New York, specialprinting wage survey would producespecial schedule rates lower than theregular area wage schedule rates for allbut one grade level, XS–7. Becauseregulations provide that the specialprinting schedule rates may not belower than the regular schedule rates foran area, New York, New York, specialprinting schedule rates for all grades butXS–7 are currently based on the NewYork, New York, regular wage schedulerates. The number of employees paidfrom this special schedule has declinedin recent years from a total of 80employees in 1985 to a current total of18 employees, only 1 of whom is ingrade XS–7.

With the reduced number ofemployees, it has been difficult tocomply with the requirement thatworkers paid from the special printingschedule participate in the special wagesurvey process. The last full-scalesurvey involved the substantial workeffort of contacting 103 printingestablishments spread over 19 counties.

No employee’s wage rate will bereduced upon conversion to the regularschedule. Because of the effects of paycap provisions and the fact that thespecial printing schedule rates are basedupon payable (restricted) regularschedule rates, the 17 employees paidrates based on the regular wageschedule will receive higher wage ratesupon conversion. The one employee ingrade XS–7 who currently receives thehigher, printing survey-based rate willbe entitled to continue at that rate underpay retention rules.

The Federal Prevailing Rate AdvisoryCommittee has reviewed thisrecommendation and by consensus hasrecommended approval.

Pursuant to 5 U.S.C. 553(b)(3)(B), Ifind that good cause exists for waivingthe general notice of proposedrulemaking. Also, pursuant to section553(d)(3) of title 5, United States Code,I find that good cause exists for makingthis rule effective in less than 30 days.The notice is being waived and theregulation is being made effective in lessthan 30 days because preparations forthe January 1995 New York, New York,survey must begin immediately.

Regulatory Flexibility ActI certify that these regulations will not

have a significant economic impact ona substantial number of small entitiesbecause they will affect only Federalagencies and employees.

List of Subjects in 5 CFR Part 532

Administrative practice andprocedure, Freedom of information,Government employees, Reporting andrecordkeeping requirements, Wages.U.S. Office of Personnel Management.Lorraine A. Green,Deputy Director.

Accordingly, OPM is amending 5 CFRpart 532 as follows:

PART 532—PREVAILING RATESYSTEMS


Authority: 5 U.S.C. 5343, 5346; § 532.707also issued under 5 U.S.C. 552.

§ 532.279 [Amended]2. In § 532.279, paragraph (j)(5) is

removed, and paragraphs (j)(6) through(j)(10) are redesignated as paragraphs(j)(5) through (j)(9), respectively.


DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Part 101

[T. D. 95–11]

Customs Service Field Organization;Extension of Port Limits of Hilo andKahului, Hawaii

AGENCY: U. S. Customs Service,Department of the Treasury.ACTION: Final rule.

SUMMARY: This document amends theCustoms Regulations pertaining to thefield organization of Customs byextending the geographical limits of theports of entry of Hilo and Kahului,Hawaii. The boundaries of the port ofHilo are extended to include the entireisland of Hawaii. The boundaries of theport of Kahului are extended to includethe entire island of Maui. The changesare being made to include all potentialCustoms work sites within the ports.These changes will enable Customs toobtain more efficient use of itspersonnel, facilities, and resources andto provide better service to carriers,importers, and the general public.EFFECTIVE DATE: February 27, 1995.


FOR FURTHER INFORMATION CONTACT: BradLund, Office of Inspection and Control,202–927–0192.

SUPPLEMENTARY INFORMATION:

Background

As part of its continuing program toobtain more efficient use of itspersonnel, facilities, and resources, andto provide better service to carriers,importers, and the general public,Customs is amending § 101.3, CustomsRegulations (19 CFR 101.3), to expandthe geographical limits of the ports ofentry of Hilo and Kahului, Hawaii.

The expanded boundaries of the portof Hilo will include the entire island ofHawaii. The expanded boundaries of theport of Kahului will include the entireisland of Maui. Expansion of the portlimits for these two islands will improveservice to the public and will makebetter use of staffing resources.

Comments

Customs published a Notice ofProposed Rulemaking in the FederalRegister (59 FR 43313) on August 23,1994, which invited the public tocomment on proposed changes to thelimits of the ports as described above.

Seventeen comments were received,all of which approved of the proposedexpansions. Accordingly, theamendments are being published infinal as they were proposed.

Revised Port Limits

The revised port limits for the port ofHilo are as follows:

In the State of Hawaii: The entireisland of Hawaii.

The revised port limits for the port ofKahului are as follows:

In the State of Hawaii: The entireisland of Maui.

Regulatory Flexibility Act andExecutive Order 12866

Although Customs solicited publiccomments on these port extensions, nonotice of proposed rulemaking wasrequired because the port extensionsrelate to agency management andorganization. Accordingly, thisdocument is not subject to theprovisions of the Regulatory FlexibilityAct (5 U.S.C. 601 et seq.). Agencyorganization matters such as these portextensions are exempt fromconsideration under Executive Order12866.

Drafting Information

The principal author of this documentwas Janet L. Johnson. RegulationsBranch. However, personnel from otheroffices participated in its development.

List of Subjects in 19 CFR Part 101Customs duties and inspection,

Exports, Imports, Organization andfunctions (Government agencies).

Amendments to the RegulationsAccordingly, Part 101 of the Customs

Regulations is amended as set forthbelow:

PART 101—GENERAL PROVISIONS

1. The general authority citation forPart 101 continues to read as follows:

Authority: 5 U.S.C. 301; 19 U.S.C. 2, 66,1202 (General Note 17, Harmonized TariffSchedule of the United States), 1623, 1624.

2. The list of Customs regions,districts and ports of entry in § 101.3(b)is amended by adding the reference‘‘T. D. 95–11’’, alongside both ‘‘Hilo’’and ‘‘Kahului’’ in the column headed‘‘Ports of entry’’ in the Honolulu,Hawaii District of the Pacific Region.George J. Weise,Commissioner of Customs.

Approved: December 29, 1994.John P. Simpson,Deputy Assistant Secretary of the Treasury.[FR Doc. 95–2075 Filed 1–26–95; 8:45 am]BILLING CODE 4820–02–P

DEPARTMENT OF HEALTH ANDHUMAN SERVICES

Food and Drug Administration

21 CFR Part 310

Drug Products Containing CertainActive Ingredients Offered Over-the-Counter (OTC) for Certain Uses

CFR Correction

In title 21 of the Code of FederalRegulations, parts 300 to 499, revised asof April 1, 1994, on page 63, in§ 310.545, paragraph (a)(7), the entry for‘‘Menthol’’ is corrected by removing theparenthetical phrase.BILLING CODE 1505-01-D

ENVIRONMENTAL PROTECTIONAGENCY

40 CFR Part 52

[MT23–1–6402a; FRL–5128–1]

Approval and Promulgation of AirQuality Implementation Plans;Montana; State Implementation Planfor East Helena SO2 NonattainmentArea

AGENCY: Environmental ProtectionAgency (EPA).

ACTION: Direct final rule.

SUMMARY: EPA fully approves the Stateimplementation plan (SIP) submitted bythe State of Montana to achieveattainment of the primary NationalAmbient Air Quality Standards(NAAQS) for sulfur dioxide (SO2). TheSIP was submitted by Montana to satisfycertain federal requirements for anapprovable nonattainment area SO2 SIPfor East Helena. The effect of EPA’s finalaction is to make the East HelenaPrimary SO2 NAAQS SIP federallyenforceable.DATES: This final rule is effective March28, 1995, unless adverse comments arereceived by February 27, 1995. If theeffective date is delayed, timely noticewill be published in the FederalRegister.ADDRESSES: Comments should beaddressed to Meredith A. Bond, 8ART–AP, Environmental Protection Agency,Region VIII, 999 18th Street, Suite 500,Denver, Colorado 80202–2405. Copies ofthe State’s submittal and otherinformation are available for inspectionduring normal business hours at thefollowing locations: Air ProgramsBranch, Environmental ProtectionAgency, Region VIII, 999 18th Street,Suite 500, Denver, Colorado 80202–2405; and Montana Department ofHealth and Environmental Sciences, AirQuality Bureau, Cogswell Building,Helena, Montana 59620–0901; and U.S.EPA Air & Radiation Docket InformationCenter, 401 M Street, SW., Washington,DC 20460.FOR FURTHER INFORMATION CONTACT:Meredith Bond at (303) 293–1764.


I. BackgroundEast Helena, Montana, is a small

community located about 5 miles east ofthe State capitol, Helena. The majorindustrial source affecting the SO2

concentrations in the ambient air is theAsarco, Incorporated, primary leadsmelter. The following summarizes theregulatory history of the East HelenaSO2 nonattainment area.

On September 19, 1975, EPAapproved the revision to the MontanaSIP which sets forth a sulfur oxidecontrol strategy to provide forattainment and maintenance of the SO2

NAAQS near Asarco in East Helena (40FR 43216).

The Clean Air Act Amendments of1977 provided for non-attainmentdesignations for areas violating theNAAQS. On March 3, 1978, EPAdesignated the East Helena area asnonattainment for SO2 based onhistorical ambient monitoring data


1 The 1990 Amendments to the Clean Air Actmade significant changes to the Act. See Public LawNo. 101–549, 104 Stat. 2399. References herein areto the Clean Air Act, as amended (‘‘the Act’’). TheClean Air Act is codified, as amended, in the U.S.Code at 42 U.S.C. Sections 7401, et seq.

2 Subpart 1 contains provisions applicable tononattainment areas generally and subpart 4contains provisions specifically applicable to PM10

nonattainment areas. At times, subpart 1 andsubpart 4 overlap or conflict. EPA has attempted toclarify the relationship among these provisions inthe ‘‘General Preamble’’ and, as appropriate, intoday’s notice and supporting information.

showing primary standard violations (43FR 8962).

Prior to this official SO2

nonattainment designation, the MontanaDepartment of Health andEnvironmental Sciences (MDHES) andAsarco had been working on a plan toreduce SO2 emissions from the EastHelena facility. The main focus of thisplan was the construction of a doublecontact sulfuric acid plant to controlSO2 emissions from the sinteringprocess. Following construction of theacid plant in July 1977, SO2

concentrations in the rural areas aroundEast Helena decreased dramatically.However, there were still violationsbeing monitored at the Kennedy Parksite.

In response to the Part D SIPrequirements of the 1977 CAAAmendments, on April 24, 1979,Montana submitted a SIP revision forthe East Helena SO2 nonattainment area.This SIP revision identified thecontinued monitored violations as beingcaused by low-level emissions fromthree 110-foot stacks serving thesmelter’s blast furnace operations. Thecontrol strategy included replacing thethree 110-foot stacks with a single 425-foot stack (for which Asarco claimedstack height credit of 375 feet), andsetting daily and six-hour emissionlimits on the new stack. On November20, 1980, EPA conditionally approvedthe SIP revision (45 FR 76685). EPA’saction was conditioned upon adequatedemonstration of good engineeringpractice (GEP) stack height for the blastfurnace stack, and revised dispersionmodeling if GEP height was determinedto be below 375 feet.

Asarco completed a field tracer studydemonstration in 1982, andsubsequently proceeded to completeconstruction of its new stack based onthe study results justifying a stackheight of 375 feet as necessary toovercome the effects of downwashcausing monitored ambient SO2

violations near the smelter.On July 5, 1983, EPA proposed to

approve the SIP and GEP demonstrationas satisfying the conditional approvalrequirements (48 FR 30696). But, finalaction was not taken due to pendinglitigation concerning the federal stackheight regulations. As a result of thislitigation, the federal stack heightregulations were revised on July 5, 1985.Among other things, these revisionschanged the requirements for justifyingstack heights above the formula heightestablished in 40 CFR 51.100(ii)(2). Forthis reason, several years later Asarcoabandoned its efforts to take credit forthe additional blast furnace stack heightabove formula height. EPA’s stack

height analysis and findings for theAsarco facility stacks are discussedfurther later in this document.

The SIP was further revised withrespect to East Helena in order toprovide for a catalyst screeningprocedure at Asarco’s acid plant. EPAapproved this revision on May 1, 1984(54 FR 18482).

The 1990 Clean Air ActAmendments 1 (‘‘1990 Amendments’’),effective November 15, 1990, reaffirmedthe nonattainment designation of EastHelena with respect to the primary andsecondary SO2 NAAQS, under section107(d)(4)(B). See 56 FR 56706 (Nov. 6,1991) and 40 CFR 81.327 (specifyingdesignation for East Helena). Section191 required that any state which waslacking an approved SIP for an areadesignated nonattainment with respectto the national primary ambient airquality standard for SO2 must resubmita plan meeting the requirements of theamended Act within 18 months ofenactment of the amendments, thus byMay 15, 1992. For the secondary SO2

NAAQS SIP for East Helena, EPAestablished November 15, 1993, as thesubmittal due date in an actionpublished in the Federal Register onOctober 7, 1993 (58 FR 52237).

The air quality planning requirementsfor SO2 nonattainment areas are set outin subparts 1 and 5 of part D of title Iof the Act.2 The amended Clean Air Actrequires nonattainment area SIPsubmittals to contain, among otherthings, provisions to assure thatreasonable available control measures(including such reductions in emissionsfrom existing sources in the area as maybe obtained through the adoption, at aminimum, of reasonably availablecontrol technology) are implemented,and that provide for attainment of theprimary SO2 standards within 5 years ofenactment of the 1990 Amendments, orNovember 15, 1995 (see Sections 172(c)and 192(b) of the Act). EPA has issueddetailed guidance that describes theAgency’s preliminary interpretationsregarding SO2 nonattainment area SIPrequirements. [57 FR 13498 (April 16,1992) and 57 FR 18070 (April 28, 1992)(hereafter called the ‘‘General

Preamble’’)]. Because EPA is describingits interpretations here only in broadterms, the reader should refer to theGeneral Preamble for a more detaileddiscussion of the interpretations of titleI advanced in today’s action and thesupporting rationale.

II. This Action

The primary SO2 NAAQS SIP for EastHelena was developed by the MDHES inconsultation with Asarco, the major SO2

source in East Helena. The State’s effortshave been coordinated with EPA toensure compliance with SIPrequirements. The Montana Board ofHealth and Environmental Sciences(MBHES) approved a stipulationbetween the MDHES and Asarco onMarch 18, 1994, to limit SO2 emissionsfrom that company’s lead smeltingoperations. This binding agreement wassubmitted to EPA on March 30, 1994, aspart of a revision of the Montana SIP.This SIP revision addresses only the 24-hour and annual primary SO2 NAAQS;Montana will address the 3-hoursecondary SO2 NAAQS in a forthcomingsubmittal. Hence, this action addressesonly the primary SO2 NAAQS.

Section 110(k) of the Act sets outprovisions governing EPA’s review ofSIP submittals (see 57 FR 13565–66). Inthis action, EPA is approving theprimary SO2 NAAQS SIP revision forthe East Helena, Montana,nonattainment area which was due onMay 15, 1992, and was submitted by theGovernor of Montana on March 30,1994. EPA is also approving the stackheight demonstrations for the Asarco,East Helena, primary lead smelter. EPAbelieves that the East Helena plan meetsthe applicable requirements of the Act.

Since the East Helena Primary SO2

NAAQS SIP was not submitted by May15, 1992, as required by section 191 ofthe Act, EPA made a finding that theState failed to submit the SIP, pursuantto section 179 of the Act, and notifiedthe Governor in a letter dated June 16,1992. See 57 FR 48614 (October 27,1992). After the East Helena PrimarySO2 NAAQS SIP was submitted onMarch 30, 1994, EPA found thesubmittal complete pursuant to section110(k)(1) of the Act and notified theGovernor accordingly in a letter datedMay 12, 1994. This completenessdetermination corrected the State’sdeficiency and, therefore, terminatedthe sanctions clock under section 179 ofthe Act.

A. Analysis of State Submission

1. Procedural Background

The Act requires States to observecertain procedural requirements in


3 Also Section 172(c)(7) of the Act requires thatplan provisions for nonattainment areas meet theapplicable provisions of Section 110(a)(2).

developing implementation plans andplan revisions for submission to EPA.Section 110(a)(2) of the Act providesthat each implementation plansubmitted by a State must be adoptedafter reasonable notice and publichearing.3 Section 110(1) of the Actsimilarly provides that each revision toan implementation plan submitted by aState under the Act must be adopted bysuch State after reasonable notice andpublic hearing. The EPA also mustdetermine whether a submittal iscomplete and therefore warrants furtherEPA review and action (see section110(k)(1) and 57 FR 13565). The EPA’scompleteness criteria for SIP submittalsare set out at 40 CFR Part 51, AppendixV. The EPA attempts to makecompleteness determinations within 60days of receiving a submission.However, a submittal is deemedcomplete by operation of law if acompleteness determination is not madeby EPA six months after receipt of thesubmission.

To entertain public comment on theimplementation plan for East Helena,the State of Montana, after providingadequate notice, held a public hearingon March 18, 1994, to address thestipulation between the MDHES andAsarco, and the East Helena primarySO2 NAAQS SIP. Following the publichearing, the stipulation and SIP wereadopted by the State. The Governor ofMontana submitted the SIP to EPA onMarch 30, 1994. The SIP submittal wasreviewed by EPA to determinecompleteness in accordance with thecompleteness criteria set out at 40 CFRPart 51, Appendix V. The submittal wasfound to be complete, and a letter datedMay 12, 1994, was forwarded to theGovernor indicating the completeness ofthe submittal and the next steps to betaken in the review process.

2. Accurate Emission InventorySection 172(c)(3) of the Act requires

that nonattainment plan provisionsinclude a comprehensive, accurate,current inventory of actual emissionsfrom all sources of relevant pollutants inthe nonattainment area. The emissioninventory also should include acomprehensive, accurate, and currentinventory of allowable emissions in thearea.

The MDHES identified two majorsources of SO2 in the East Helena area:the Asarco Smelter complex and theAsh Grove cement plant. Emissioninventory information for the Ash GroveKiln stack was derived from an

engineering calculation to determinepotential SO2 emissions. Assuming allheat input to the kiln is supplied by 6%sulfur coke, a potential emission rate of2.7 tons SO2/day was used for thisfacility in this SIP revision. Actual SO2

emissions for this source areapproximately 1.0 ton per day.

A detailed SO2 emission inventory ofthe Asarco smelter facility wasconducted in the fall of 1991. Acomplete testing protocol was approvedby EPA along with the final emissioninventory report. The report provided acomplete and accurate SO2 emissioninventory of the entire facility for use indispersion modeling studies.

In general, the SO2 emission sourceswere separated into three majorcategories: Point sources, volumesources, and fugitive sources. Theresults of the point source testsconfirmed Asarco’s three major sourcesof SO2 emissions to be the Sinter PlantBaghouse stack, Acid Plant stack, andBlast Furnace Baghouse stack. Volumeand fugitive sources were alsoquantified.

The MDHES also maintains an annualSO2 emission inventory for the Asarcofacility. This inventory does not includeall sources that were measured in thefield sampling study, but does includethe major sources of SO2 emissions.Totals for 1990 (including only the threemajor point sources) were 17,491.0 tpy;totals for 1991 (with building volumeand fugitive area sources included) were18,031.7 tpy. Thus, annual SO2

emissions for the Asarco facility areapproximately 18,000 tpy. For the AshGrove kiln stacks, emissions for thesame years were less than 280 tpy.

EPA is approving the emissionsinventory because it is accurate andcomprehensive and provides a sufficientbasis for determining the adequacy ofthe attainment demonstration for thisarea consistent with the requirements ofsections 172(c)(3) and 110(a)(2)(K) of theAct. For further details see the TSD.

3. RACM (Including RACT)As noted, the initial SO2

nonattainment areas must submitprovisions to assure that RACM(including RACT) are implemented asexpeditiously as possible (see section172(c)(1)). The General Preamblecontains a detailed discussion of EPA’sinterpretation of the RACM (includingRACT) requirement (see 57 FR 13547and 13560–13561), and defines RACTfor SO2 as that control technology whichis necessary to achieve the NAAQS.

The Asarco, East Helena, primary leadsmelter was identified as the majorsource of the SO2 nonattainmentproblem in East Helena. The control

strategy includes setting operational SO2

emission limits for several of the majoremission points of the Asarco facility.

Asarco developed a set of emissionsparameters for combined emissionsfrom the two largest SO2 emissionpoints, the sinter and blast furnacestacks, in order to provide maximumoperating flexibility while stillprotecting the NAAQS. The set ofcompliance parameters for combinedemissions from the Blast Furnace Stackand Sinter Plant Stack consists of thefollowing relationships:for:0<S≤22.93, B=29.64¥(0.180) S22.93<S≤54.54, B=38.74¥(0.577) S54.54<S≤60.27, B=76.60¥(1.271) Swhere:B=Daily emissions of SO2 from the Blast

Furnace Stack in tons per calendarday

S=Daily emissions of SO2 from theSinter Plant Stack in tons percalendar day

In addition to the complianceparameters for combined emissionsfrom the sinter and blast furnace stacks,the March 18, 1994, stipulation also setsabsolute SO2 emission limitations forthe sinter and blast furnace stacks at60.27 tons per calendar day and 29.64tons per calendar day, respectively.Daily emissions of SO2 from the AcidPlant Stack shall not exceed 4.30 tonsper calendar day. SO2 emissions fromthe Concentrate Storage and HandlingBuilding Stack (including the exhaustfrom the new Sinter Plant VentilationSystem baghouse) shall not exceed46.00 pounds per hour or 0.552 tons percalendar day. All of these emissionlimits, including the complianceparameters for the combined emissionsof the sinter and blast furnace stacks,were effective September 1, 1994.

Two additional emission limitationson minor stack sources at the Asarcofacility take effect June 30, 1995: SO2

emissions from the Crushing MillBaghouse Stacks #1 and #2 shall notexceed 0.19 and 0.37 tons per calendarday, respectively.

The stipulation details the use ofcontinuous emission monitoringsystems to determine compliance withthe emission limitations for the sinterplant stack, blast furnace stack, and acidplant stack. Emission testing provisionsfor the remaining stacks are alsospecified.

Provisions have also beenincorporated into the stipulation toinsure that sulfur dioxide emissionsfrom miscellaneous volume and fugitivesources do not increase beyond theircurrent levels. Those provisionsinclude: limiting fugitive emissions of


SO2 from the Sinter (D&L) Building byrestricting openings to the buildingenclosure; maintaining and operating allprocesses and systems within theCottrell Penthouse, Mist PrecipitatorBuilding, and Pump Tank Building suchthat conditions which contribute tovolume source SO2 emissions fromthese sources are not significantlyworsened compared to conditionsexisting during the preparation of theJanuary 20, 1992, emission inventoryreport; and maintaining and operatingall processes and systems associatedwith the Acid Plant Scrubber Towerssuch that conditions which contributeto volume source SO2 emissions fromthis source are not significantlyworsened compared to conditionsexisting during the preparation of theJanuary 20, 1992, emission inventoryreport.

A more detailed discussion of thecontrol strategy can be found in the TSDfor this action. EPA has reviewed theState’s documentation and concludedthat it adequately justifies the controlmeasures to be implemented. Theimplementation of Montana’s SO2

nonattainment plan will result in theattainment of the primary SO2 NAAQSby November 15, 1995. By this actionEPA is approving the East Helenaprimary SO2 plan’s RACM (includingRACT) in its entirety, noting thatadditional dispersion modeling andcontrol strategy evaluation will benecessary in the future to address thesecondary, 3-hour standard.

4. DemonstrationThe initial SO2 nonattainment areas

are required to submit a demonstration(including air quality modeling)showing that the plan will provide forattainment as expeditiously aspracticable, but no later than November15, 1995. EPA-approved dispersionmodels ISCST and RTDM were used topredict ambient SO2 concentrationsaround the Asarco facility. The primarySO2 NAAQS are 365 micrograms percubic meter (µg/m 3) (0.14 parts permillion (ppm)), averaged over a 24-hourperiod and not to be exceeded morethan once per year, and 80 µg/m 3 (0.03ppm) annual arithmetic mean (see 40CFR 50.4). The demonstration for EastHelena indicates that the primary SO2

NAAQS will be attained by November15, 1995. For a more detaileddescription of the attainmentdemonstration and the control strategiesused, see the TSD for this action.

5. Enforceability IssuesAll measures and other elements in

the SIP must be enforceable by the Stateand EPA (see sections 172(c)(6) and

110(a)(2)(A) of the Act and 57 FR13556). The EPA criteria addressing theenforceability of SIPs and SIP revisionswere stated in a September 23, 1987,memorandum (with attachments) from J.Craig Potter, Assistant Administrator forAir and Radiation, et al. (see 57 FR13541). Nonattainment area planprovisions also must contain a programto provide for enforcement of controlmeasures and other elements in the SIP(see section 110(a)(2)(C) of the Act).

The specific control measurecontained in the SIP are addressedabove in section 3, ‘‘RACM (includingRACT).’’ The March 18, 1994,stipulation between the MDHES andAsarco has been approved by theMBHES in accordance with section 75–2–301 of the Montana Clean Air Act andeffectuated by a MBHES order, andsince the MDHES can enforce MBHESorders, the MDHES has independentenforcement powers. The MontanaClean Air Act grants authority to theMDHES to enforce orders of the Board(section 75–2–112, Montana CodeAnnotated (MCA)). Sections 75–2–412and 75–2–413, MCA, authorize theMDHES to seek criminal and civilpenalties for violations of any Boardorder in the amount of $10,000.00 perday of violation, respectively. Inaddition, Section 75–2–431, MCA,authorizes the MDHES to seeknoncompliance penalties for anyviolation of a Board order.Noncompliance penalties shall be noless than the economic value which adelay in compliance may have for theowner of such a source, including thecapital costs of compliance and debtservice over a normal amortizationperiod (not to exceed ten years ofoperation) and maintenance costsforegone as a result of noncompliance.

EPA believes that the State’s existingair enforcement program will beadequate to ensure implementation ofthis SIP revision. The TSD for thisaction contains further information onenforceability requirements,responsibilities, and resources intendedto support effective implementation ofthe control measures.

6. Reasonable Further ProgressSection 171(l) of the amended Act

defines RFP as ‘‘such annualincremental reductions in emissions ofthe relevant air pollutant as are requiredby [part D] or may reasonably berequired by EPA for the purpose ofensuring attainment of the applicablenational ambient air quality standard bythe applicable date.’’ As discussed inthe General Preamble, for SO2, there isusually a single ‘‘step’’ between pre-control nonattainment and post-control

attainment. Therefore, for SO2, with itsdiscernible relationship betweenemissions and air quality and significantand immediate air qualityimprovements, RFP is construed as‘‘adherence to an ambitious complianceschedule.’’

Asarco became responsible for thereporting requirements outlined in theSIP after July 1, 1994. The emission andprocess limitations outlined abovebecame effective on September 1, 1994.These timelines allow Asarco sufficientopportunity to implement the controlstrategy, and to gain operatingexperience before the requirementsbecome effective. The emissionlimitations went into effect September1, 1994, a date far in advance of theNovember 15, 1995 attainment date.EPA concurs that this programconstitutes adherence to an ambitiouscompliance schedule and thereforedemonstrates reasonable furtherprogress.

7. Contingency MeasuresSection 172(c)(9) of the amended Act

defines contingency measures asmeasures in a SIP which are to beimplemented if an area fails to makeRFP or fails to attain the NAAQS by theapplicable attainment date. Contingencymeasures become effective withoutfurther action by the State or EPA, upondetermination by EPA that the area hasfailed to either make reasonable furtherprogress or to attain the SO2 NAAQS bythe applicable statutory deadline. ForSO2 programs, EPA interprets‘‘contingency measures’’ to mean thatthe State agency has a comprehensiveprogram to identify sources of violationsof the SO2 NAAQS and to undertake anaggressive follow-up for compliance andenforcement, including expeditedprocedures for establishing enforceableconsent agreements pending theadoption of revised SIP’s. (See 57 FR13547, April 16, 1992.)

The East Helena control strategy isbased upon a dispersion modelinganalysis which indicates that thePrimary SO2 NAAQS will be protected.The use of continuous emissionmonitoring systems will ensure that theemission limitations in the plan are notexceeded. In addition, a compliancenetwork of ambient air monitoringstations will be maintained around thesmelter at locations associated withpredicted maximum concentrations.This monitoring system should quicklyidentify any violations of the NAAQS, ifthey should occur.

If violations should occur, theMDHES would immediately beginnegotiations with Asarco to reachagreement on control measures to


correct the problem. Asarco would thenimplement those measures to assurecompliance as expeditiously as possible.Additionally, the MDHES hasemergency powers under Section75.2.402 of the Montana Clean Air Actto require curtailment of a source if thesource is causing imminent danger tohuman health or safety.

III. Stack Height Analysis

A. Background

On February 8, 1982 (47 FR 5864),EPA promulgated final regulationslimiting stack height credits and otherdispersion techniques as required bySection 123 of the CAA. Theseregulations were challenged in the U.S.Court of appeals for the D.C. Circuit bythe Sierra Club Legal Defense Fund,Inc., the Natural Resources DefenseCouncil, Inc., and the Commonwealth ofPennsylvania in Sierra Club v. EPA. OnOctober 11, 1983, the court issued itsdecision ordering EPA to reconsiderportions of the stack height regulations,revising certain portions and upholdingother portions.

On February 28, 1984, the electricpower industry filed a petition for a writof certiorari with the U.S. SupremeCourt. On July 2, 1984, the SupremeCourt denied the petition, and on July18, 1984, the Court of Appeals mandatewas formally issued, implementing thecourt’s decision and requiring EPA topromulgate revisions to the stack heightregulations within six months. Thepromulgation deadline was ultimatelyextended to June 27, 1985.

Revisions to the stack heightregulations were proposed on November9, 1984 (49 FR 44878), and promulgatedon July 8, 1985 (50 FR 27892). Therevisions redefined a number of specificterms including ‘‘excessiveconcentrations,’’ ‘‘dispersiontechniques,’’ ‘‘nearby,’’ and otherimportant concepts, and modified someof the bases for determining goodengineering practice (GEP) stack height.

Pursuant to section 406(d)(2) of theCAA, all States were required to: (1)Review and revise, as necessary, theirSIPs to include provisions that limitstack height credit and dispersiontechniques in accordance with therevised regulations and (2) review allexisting emission limitations todetermine whether any of theselimitations have been affected by stackheight credits above GEP or any otherdispersion techniques. For anylimitations so affected, States were toprepare revised limitations consistentwith their revised SIPs. All SIPrevisions and revised emission limitswere to be submitted to EPA within 9

months of the EPA stack heightregulations promulgation.

Subsequently, EPA issued detailedguidance on carrying out the necessaryreviews. For the review of emissionlimitations, States were to prepareinventories of stacks greater than 65meters in height and sources withemissions of sulfur dioxide (SO2) inexcess of 5,000 tons per year. Theselimits correspond to the de minimisstack height and the de minimis SO2

emission exemption from prohibiteddispersion techniques. These sourceswere then subjected to detailed reviewfor conformance with the revisedregulations. State submissions were tocontain an evaluation of each stack andsource in the inventory.

Subsequent to the July 8, 1985promulgation, the stack heightregulations were again challenged inNRDC v. Thomas, 838 F. 2d 1224 (D.C.Cir. 1988). On January 22, 1988, the U.S.Court of Appeals for the D.C. Circuitissued its decision affirming theregulations for the most part, butremanding three provisions to the EPAfor reconsideration. These are:Grandfathering stack height credits forsources that raise their stacks prior toOctober 1, 1983, up to the heightpermitted by GEP formula height (40CFR 51.100 (kk)(21)), dispersion creditfor sources originally designed andconstructed with merged or originallydesigned and constructed with mergedor multi-flue stacks, (40 CFR 51.100(hh)(2)(ii)(A)), and grandfathering creditfor the refined (H + 1.5 L) formulaheight for sources unable to showreliance on the original (2.5H) formula(40 CFR 51.100 (ii)(2)).

B. State of Montana Submissions

EPA promulgated approval of a SIPrevision which revised theAdministrative Rules of Montanagoverning stack height and dispersiontechniques on June 7, 1989 (54 FR24334). In that same action, EPAapproved Montana’s stack heightdemonstration analyses with theexception of the Asarco East Helenalead smelter facility stacks. This is thefirst time that EPA is taking action onthe Asarco stacks.

C. Asarco, East Helena Stack HeightDemonstration

EPA received a stack height reviewfrom Montana with a letter datedNovember 25, 1985, and a subsequentsubmittal dated January 28, 1986. Withregard to the Asarco stack heights, theState found that no existing emissionlimitations were affected by stack heightcredits above GEP or any other

dispersion technique prohibited by EPAregulations.

EPA has determined that Montana’sinventory of the Asarco facility at EastHelena is complete and has carefullyreviewed the State’s findings. EPAconcurs with those findings, which aresummarized in the table below. Adetailed discussion of the Asarco stackheight analysis can be found in the TSDfor this action.

Stack I.D.

Actualstackheight

(m)

ApplicableGEP formula

GEPheight

(m)

Sinter ........... 128 Grand-fathered(1939).

...........

Blast Fur-nace.

130 de minimis ... 65

Zinc Furnace 107 (*) (*)

* Source is shut down. New permit will berequired to reopen zinc plant.

IV. Final ActionEPA is approving the East Helena

primary SO2 NAAQS SIP submitted toEPA on March 30, 1994. Among otherthings, the State of Montana hasdemonstrated that the East Helena SO2

nonattainment area will attain theprimary SO2 NAAQS by November 15,1995. EPA is also approving stack heightdemonstrations for the Asarco, EastHelena, primary lead smelter.

Because EPA considers this actionnoncontroversial and anticipates noadverse comments, this final approval ismade without prior proposal. Thisaction will be effective March 28, 1995.However, if adverse comments arereceived by February 27, 1995, thenEPA would withdraw this final approvalaction and this notice would insteadstand as a proposed rule. EPA wouldthen address the comments in asubsequent final promulgation notice.

Nothing in this action should beconstrued as permitting, allowing orestablishing a precedent for any futurerequest for revision to any SIP. Eachrequest for revision to any SIP shall beconsidered separately in light of specifictechnical, economic, and environmentalfactors, and in relation to relevantstatutory and regulatory requirements.

The OMB has exempted thisregulatory action from review underExecutive Order 12866.

Under the Regulatory Flexibility Act,5 U.S.C. 600 et seq., EPA must preparea regulatory flexibility analysisassessing the impact of any proposed orfinal rule on small entities. 5 U.S.C. 603and 604. Alternatively, EPA may certifythat the rule will not have a significanteconomic impact on a substantialnumber of small entities. Small entities


include small businesses, small not-for-profit enterprises, and governmententities with jurisdiction overpopulations of less than 50,000.

SIP approvals under section 110 andSubchapter I, Part D of the Clean Air Actdo not create any new requirements, butsimply approve requirements that theState is already imposing. Therefore,because the Federal SIP approval doesnot impose any new requirements, Icertify that it does not have a significantimpact on a substantial number of smallentities affected. Moreover, due to thenature of the Federal-state relationshipunder the Clean Air Act, preparation ofa regulatory flexibility analysis wouldconstitute Federal inquiry into theeconomic reasonableness of state action.The Clean Air Act forbids EPA to baseits actions concerning SIPs on suchgrounds. Union Electric Co. v. U.S.E.P.A.,427 U.S. 246, 256–66 (1976); 42U.S.C. 7410 (a)(2).

Under section 307(b)(1) of the Act,petitions for judicial review of thisaction must be filed in the United StatesCourt of Appeals for the appropriatecircuit by March 28, 1995. Filing apetition for reconsideration by theAdministrator of this final rule does notaffect the finality of this rule for thepurposes of judicial review nor does itextend the time within which a petitionfor judicial review may be filed, andshall not postpone the effectiveness ofsuch rule or action. This action may notbe challenged later in proceedings toenforce its requirements. (See Act,section 307(b)(2).)

List of Subjects in 40 CFR Part 52Environmental Protection, Air

pollution control, Incorporation byreference, Intergovernmental relations,Reporting and recordkeepingrequirements, Sulfur dioxide.

Dated: December 14, 1994.William P. Yellowtail,Regional Administrator.

Part 52, chapter I, title 40 of the Codeof Federal Regulations is amended asfollows:

PART 52—[AMENDED]


Authority: 42 U.S.C. 7401–7671q.

Subpart BB—Montana

2. Section 52.1370 is amended byadding paragraph (c)(37) to read asfollows:

§ 52.1370 Identification of plan.

* * * * *(c) * * *

(37) The Governor of Montanasubmitted a SIP revision meeting therequirements for the primary SO2

NAAQS State Implementation Plan(SIP) for the East Helena, Montananonattainment area with a letter datedMarch 30, 1994. The submittal was tosatisfy those SO2 nonattainment areaSIP requirements due for East Helena onMay 15, 1992.

(i) Incorporation by reference.(A) Stipulation signed March 15,

1994, between the Montana Departmentof Health and Environmental Sciences(MDHES) and Asarco, Incorporated,which specifies SO2 emissionlimitations and requirements for thecompany’s primary lead smelter locatedin East Helena, MT.

(B) Board order issued on March 18,1994, by the Montana Board of Healthand Environmental Sciences approvingand adopting the control strategy forachieving and maintaining the primarySO2 NAAQS in the East Helena area.

[FR Doc. 95–2017 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–P

40 CFR Part 52

[IL105–1–6841a; FRL–5139–5]

Approval and Promulgation ofImplementation Plans for Ozone;Illinois

AGENCY: U. S. Environmental ProtectionAgency (USEPA).ACTION: Direct final rule.

SUMMARY: The U.S. EnvironmentalProtection Agency (USEPA) approvesthe State Implementation Plan (SIP)revision request submitted by the Stateof Illinois on October 25, 1994, for thepurpose of requiring the installation ofpressure/vacuum (P/V) relief valves onstorage tank vent pipes at certaingasoline dispensing operations in theChicago and Metro-East St. Louis(Metro-East) ozone nonattainment areas.The rationale for the approval is setforth in this final rule; additionalinformation is available at the addressindicated. In the proposed rules sectionof this Federal Register, USEPA isproposing approval of and solicitingpublic comment on this requested SIPrevision. If adverse comments arereceived on this direct final rule,USEPA will withdraw this direct finalrule and address the comments receivedin a subsequent final rule on the relatedproposed rule which is being publishedin the proposed rules section of thisFederal Register. No additionalopportunity for public comment will beprovided. Unless this direct final rule is

withdrawn no further rulemaking willoccur on this requested SIP revision.DATES: This final rule is effective March28, 1995 unless notice is received byFebruary 27, 1995 that someone wishesto submit adverse comments. If theeffective date is delayed, timely noticewill be published in the FederalRegister.ADDRESSES: Copies of the USEPA’stechnical analysis are available forinspection at the following address: (Itis recommended that you telephoneFrancisco Acevedo at (312) 886–6061before visiting the Region 5 Office.)

U.S. Environmental ProtectionAgency, Region 5, Air and RadiationDivision, 77 West Jackson Boulevard,Chicago, Illinois 60604.

Written comments can be mailed to:J. Elmer Bortzer, Chief, RegulationDevelopment Section (AR–18J),Regulation Development Branch, Airand Radiation Division, U.S.Environmental Protection Agency, 77West Jackson Boulevard, Chicago,Illinois 60604.

A copy of the Pressure/Vacuum SIPrevision is available for inspection at:Office of Air and Radiation (OAR),Docket and Information Center (AirDocket 6102), room 1500, U.S.Environmental Protection Agency, 401M Street, SW., Washington, DC 20460.FOR FURTHER INFORMATION CONTACT:Francisco Acevedo (312) 886–6061.


I. BackgroundSection 182(b)(1) of the Act requires

all moderate and above ozonenonattainment areas to achieve a 15percent reduction of 1990 emissions ofvolatile organic material by 1996. InIllinois, the Chicago and the Metro-Eastareas are classified as ‘‘Severe’’ and‘‘Moderate’’ nonattainment for ozone,respectively, and as such subject to the15 percent Rate of Progress (ROP)requirement.

The Illinois Environmental ProtectionAgency (IEPA) developed and submitteda plan to USEPA on November 15, 1993outlining the VOC emission controlmeasures which will be implemented inorder to satisfy the 15 percent ROPrequirements. On January 21, 1994,USEPA found the Illinois Planincomplete because it did not containall the necessary components necessaryfor approval. On November 22, 1994,IEPA resubmitted the 15 percent ROPplan and USEPA is currently reviewingthe plan. One of the measures identifiedfor both the Chicago and Metro-Eastplans is the introduction of storage tankbreathing controls for gasolinedispensing facilities. The Chicago ozone


nonattainment area includes Cook,DuPage, Grundy (only Aux Sable andGoose Lake Townships), Kane, Kendall(Oswego Township only), LakeMcHenry, and Will Counties. TheMetro-East ozone nonattainment areaincludes Madison, Monroe, and St. ClairCounties. On April 22, 1994, IEPA filedthe proposed P/V relief valves rule withthe Illinois Pollution Control Board(Board). A public hearing on the ruleswas held on June 17, 1994, in Chicago,Illinois, and on September 5, 1994, theBoard adopted a Final Opinion andOrder for the proposed amendments.The rules became effective onSeptember 21, 1994 and they werepublished in the Illinois State registeron October 7, 1994. The IEPA formallysubmitted the Pressure/Vacuum ReliefValve rules to USEPA on October 25,1994, as a revision to the Illinois SIP forozone.

II. Stage I/II RequirementsIn 1975, the USEPA issued regulatory

guidance to assist states in preparingregulations for the control of volatileorganic material in ozone nonattainmentareas. As a result, gasoline dispensingoperations located in the Illinoisnonattainment areas were required to beequipped with Stage I vapor recoverysystems. The Stage I controls collectgasoline vapor losses generated duringbulk gasoline delivery. These Stage Irules did not, however, include anyrequirement for the control of storagetank breathing loss.

The Clean Air Act Amendments of1990 further required certain ozonenonattainment areas to implement StageII vapor recovery. Accordingly, Stage IIvapor recovery rules for the Chicagoozone nonattainment area werepromulgated in 1992. The Stage IIsystem collects gasoline vapors beingexpelled from vehicles during refueling.These Stage II systems are highlyeffective and work in conjunction withthe Stage I controls. As with Stage I,Stage II rules did not directly require thecontrol of storage tank breathing losses.

Even with the Stage I and Stage IIcontrols, volatile organic mass (VOM)(gasoline vapor) emissions still occur asvapors are lost (pushed out) through theunderground storage tank vent pipe.The vent pipe emissions result from thebreathing losses which are caused byvapor and liquid expansion andcontraction due to diurnal changes intemperature, barometric pressure andgasoline evaporation.

IEPA’s regulations are intended toincrease the effectiveness of Stage I andII controls as well as control thegasoline vapor losses being expelledthrough the vent pipe as stated above.

The control of these emissions will beto require that all open vent pipes atgasoline dispensing facilities with astorage tank capacity of at least 575gallons be equipped with low pressure/vacuum (P/V) relief valves.

III. Analysis of RuleThe P/V rule amends 35 Ill. Adm.

Code Part 201 Subpart K, Part 211Subpart B, Part 218 Subpart Y, and Part219 Subpart Y. The P/V relief valve rulerequires gasoline dispensing facilitieslocated in the Chicago and Metro-Eastozone nonattainment areas with astorage tank capacity of at least 575gallons to install a P/V relief valve oneach gasoline storage tank vent byMarch 15, 1995. However, tanksinstalled before January 1, 1979, areexempt from the rule if they have acapacity of less than 2000 gallons, as aretanks that are equipped with floatingroofs or equivalent control devices thathave been approved by the State andUSEPA. The P/V relief valve must becapable of resisting a pressure of at least3.5 inches water column and a vacuumof at least 6 inches water column. If afacility is subject to the Stage II vaporrecovery rules, the P/V relief valve usedmust comply with its California AirResources Board (CARB) certification.The P/V rule also requires the owner oroperator to register the installation ofthe P/V relief valve, to maintain recordsof malfunctions, maintenance, andrepair and to annually test for propersystem pressure/vacuum. IEPAcurrently employs an annual inspectionprogram for Stage I and II regulatedfacilities. The storage tank breathingcontrol program will be incorporatedinto the existing inspection program.The State currently has the authority toadminister and enforce the controlprogram once the rules becomeeffective.

The Illinois Environmental ProtectionAct (Illinois Act), section 42(a), statesthat any person that violates anyprovision of the Illinois Act or anyregulation adopted by the Board, or anypermit or term or condition thereof, orthat violates any determination or orderof the Board pursuant to the Illinois Act,shall be liable to a civil penalty not toexceed $50,000 for the violation and anadditional $10,000 for each day forwhich the violation continues. In thatthis submittal is a regulation adopted bythe Board, a violation of which subjectsthe violator to penalties under section42(a), the submittal contains sufficientenforcement penalties for approval.

IV. Final Rulemaking ActionThe USEPA approves the SIP revision

submitted by the State of Illinois. The

State of Illinois has submitted a SIPrevision that includes an enforceablestate regulation which is consistent withFederal requirements. The SIP alsoincludes a commitment from the Stateto perform enforcement inspections onthe regulated stations. Substantialpenalties that will provide an adequateincentive for the regulated industry tocomply and are no less than theexpected cost of compliance areincluded in current Pollution ControlBoard Regulation. USEPA is, therefore,approving this submittal.

V. Procedural Background

Because USEPA considers this actionnoncontroversial and routine, we areapproving it without prior proposal. Theaction will become effective on March28, 1995. However, if the USEPAreceives adverse comments by February27, 1995, then the USEPA will publisha document that withdraws the action,and will address the comments receivedin response to this direct final rule inthe final rule on the requested SIPrevision which has been proposed forapproval in the proposed rules sectionof this Federal Register. The commentperiod will not be extended orreopened.

This action has been classified as aTable 3 action by the RegionalAdministrator under the procedurespublished in the Federal Register onJanuary 19, 1989 (54 FR 2214–2225), asrevised by an October 4, 1993,memorandum from Michael H. Shapiro,Acting Assistant Administrator for Airand Radiation. The Office ofManagement and Budget (OMB) hasexempted this regulatory action fromExecutive Order 12866 review.

Nothing in this action should beconstrued as permitting or allowing orestablishing a precedent for any futurerequest for revision to any StateImplementation Plan. Each request forrevision to any State ImplementationPlan shall be considered separately inlight of specific technical, economic,and environmental factors and inrelation to relevant statutory andregulatory requirements.

Under the Regulatory Flexibility Act,5 U.S.C. 600 et seq., USEPA mustprepare a regulatory flexibility analysisassessing the impact of any proposed orfinal rule on small entities. 5 U.S.C. 603and 604. Alternatively, USEPA maycertify that the rule will not have asignificant impact on a substantialnumber of small entities. Small entitiesinclude small businesses, small not-for-profit enterprises, and governmententities with jurisdiction overpopulations of less than 50,000.


SIP approvals under section 110 andsubchapter I, part D of the Act do notcreate any new requirements, butsimply approve requirements that theState is already imposing. Therefore,because the Federal SIP approval doesnot impose any new requirements, Icertify that it does not have a significantimpact on any small entities affected.Moreover, due to the nature of theFederal state relationship under the Act,preparation of a regulatory flexibilityanalysis would constitute Federalinquiry into the economicreasonableness of State action. The Actforbids USEPA to base its actionsconcerning SIPs on such grounds.Union Electric Co. v. U.S. E.P.A., 427U.S. 246, 256–66 (S.Ct. 1976); 42 U.S.C.7410(a)(2).

Under section 307(b)(1) of the CleanAir Act, petitions for judicial review ofthis action must be filed in the UnitedStates Court of Appeals for theappropriate circuit by March 28, 1995.Filing a petition for reconsideration bythe Administrator of this final rule doesnot affect the finality of this rule for thepurposes of judicial review nor does itextend the time within which a petitionfor judicial review may be filed, andshall not postpone the effectiveness ofsuch rule or action. This action may notbe challenged later in proceedings toenforce its requirements. (See section307(b)(2).)


Environmental protection, Airpollution control, Hydrocarbon,Incorporation by reference, Ozone.

Dated: December 29, 1994.Valdas V. Adamkus,Regional Administrator.

For the reasons stated in thepreamble, part 52, chapter I, title 40 ofthe Code of Federal Regulations isamended as follows:

PART 52—[AMENDED]


Authority: 42 U.S.C. 7401–7671q.

Subpart O—Illinois

2. Section 52.720 is amended byadding paragraph (c)(107) to read asfollows:

§ 52.720 Identification of plan.

* * * * *(c) * * *(107) On October 25, 1994, Illinois

submitted a regulation which requiresgasoline dispensing operations in theChicago and Metro-East St. Louis ozonenonattainment areas that have storage

tanks of at least 575 gallons to installpressure/vacuum relief valves onstorage tank vent pipes. Tanks installedbefore January 1, 1979, are exempt fromthe rule if they have a capacity of lessthan 2000 gallons, as are tanks that areequipped with floating roofs orequivalent control devices that havebeen approved by the State and USEPA.

(i) Incorporation by reference. IllinoisAdministrative Code Title 35:Environmental Protection, Subtitle B:Air Pollution, Chapter I: PollutionControl Board, Subchapter c: EmissionsStandards and Limitations forStationary Sources.

(A) Part 201 Permits and GeneralProvisions, Section 201.302 Reports.Amended at 18 Ill. Reg. 15002. EffectiveSeptember 21, 1994.

(B) Part 211 Definitions and GeneralProvisions, Section 211.5060 Pressure/Vacuum Relief Valve. Added at 18 Ill.Reg. 14962. Effective September 21,1994.

(C) Part 218 Organic MaterialEmission Standards and Limitations forChicago Area, Section 218.583 GasolineDispensing Operations–Storage TankFilling Operations. Amended at 18 Ill.Reg. 14973. Effective September 21,1994.

(D) Part 219 Organic MaterialEmission Standards and Limitations forMetro East Area, Section 219.583Gasoline Dispensing Operations–StorageTank Filling Operations. Amended at 18Ill. Reg. 14987. Effective September 21,1994.[FR Doc. 95–2015 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–F

40 CFR Part 63

[AD–FRL–5147–1]

RIN 2060–AC19

National Emission Standards forHazardous Air Pollutants for SourceCategories; Organic Hazardous AirPollutants From the Synthetic OrganicChemical Manufacturing Industry andOther Processes Subject to theNegotiated Regulation for EquipmentLeaks; Extension of Compliance

AGENCY: Environmental ProtectionAgency (EPA).ACTION: Final rule; extension ofcompliance.

SUMMARY: On October 24 and 28, 1994,EPA announced a partial 3-month stayand reconsideration of certain aspects ofthe ‘‘National Emission Standards forHazardous Air Pollutants From theSynthetic Organic ChemicalManufacturing Industry and Other

Processes Subject to the NegotiatedRegulation for Equipment Leaks’’ 59 FR19402 (April 22, 1994) and 59 FR 29196(June 6, 1994) (collectively known as the‘‘hazardous organics NESHAP’’ or the‘‘HON’’). The EPA also proposed,pursuant to Clean Air Act section301(a)(1), 42 U.S.C. 7601(a)(1), to extendtemporarily the applicable compliancedates for sources subject to the stay, butonly as necessary to complete the tworeconsiderations (including appropriateregulatory action) of the rule inquestion. The EPA received no adversepublic comment on either of the twoproposed short-term complianceextensions. The EPA is extending thecompliance dates until April 24, 1995.A short-term extension of this nature iswell within the 3-year period allowedby the Act.EFFECTIVE DATE: January 27, 1995.FOR FURTHER INFORMATION CONTACT: Dr.Janet S. Meyer, Emission StandardsDivision (MD–13), U.S. EnvironmentalProtection Agency, Office of Air QualityPlanning and Standards, ResearchTriangle Park, North Carolina 27711,telephone number (919) 541–5254.


I. Compliance ExtensionOn October 24, 1995 (59 FR 53359)

EPA announced that, pursuant to CleanAir Act section 307(d)(7)(B), it isreconsidering certain portions of theHON rule. The October 24, 1995administrative stay applied only tothose source owners or operators whomake a representation in writing thatresolution of the area source definitionissues could affect whether the facilityis subject to the HON. Readers shouldrefer to that notice for a completediscussion of the background and ruleaffected.

On October 28, 1995 (59 FR 54131),EPA announced an administrative stayof the effectiveness of the provisions forcompressors and for surge controlvessels and bottoms receivers forsources subject to the October 24, 1994compliance date pendingreconsideration of those provisions.Readers should refer to that notice andthe associated proposed amendments tosubpart H (59 FR 54154) for a completediscussion of the background and theproposed changes to the rule.

Along with both notices of partial stayand reconsideration, EPA also proposedto extend the compliance dates beyondthe 3 months provided, as necessary tocomplete reconsideration and revisionof the rule in question.

Ten comment letters were received oneach of the two notices of partial stayand reconsideration. No adverse


comments were received on eitherproposal to extend the compliance datesbeyond 3 months, if necessary, in orderto complete reconsideration andrevision of the rules in question. As EPAfinds that it is not able to complete thereconsideration and the regulatoryaction to the rule within the 3 monthperiod, EPA is extending thecompliance date until April 24, 1995.The EPA expects to complete theregulatory action on both petitions forreconsideration before the Aprilcompliance date.

II. Judicial Review

Under section 307(b)(1) of the CleanAir Act (CAA), judicial review of theactions taken by this final rule isavailable only on the filing of a petitionfor review in the U.S. Court of Appealsfor the District of Columbia Circuitwithin 60 days of today’s publication ofthis action. Under section 307(b)(2) ofthe CAA, the requirements that aresubject to today’s notice may not bechallenged later in civil or criminalproceedings brought by EPA to enforcethese requirements.

Pursuant to the provisions of 5 U.S.C.605(b), I hereby certify that this rule willnot have a significant economic impacton a substantial number of smallbusiness entities.


Environmental protection, Airpollution control, Hazardoussubstances.

Dated: January 23, 1995.Carol M. Browner,Administrator.

For the reasons set out in thepreamble, part 63 of Chapter I of title 40of the Code of Federal Regulations isamended as follows.

PART 63—NATIONAL EMISSIONSTANDARDS FOR HAZARDOUS AIRPOLLUTANTS FOR SOURCECATEGORIES


Authority: 42 U.S.C. 7401 et seq.

2. Section 63.100 is amended byrevising paragraphs (n) and (o) to readas follows:

§ 63.100 Applicability and designation ofsource.

* * * * *(n) Rules Stayed for Reconsideration.

Notwithstanding any other provision ofthis subpart, the effectiveness of subpartF is stayed from October 24, 1994, toApril 24, 1995 only as applied to thosesources for which the owner or operator

makes a representation in writing to theAdministrator that the resolution of thearea source definition issues could havean effect on the compliance status of thesource with respect to subpart F.

(o) Sections Stayed forReconsideration. Notwithstanding anyother provision of this subpart, theeffectiveness of §§ 63.164 and 63.170 ofsubpart H is stayed from October 28,1994 to April 24, 1995 only as appliedto those sources subject to § 63.100(k)(3)(i) and (ii).

3. Section 63.110 is amended byrevising paragraph (g) to read as follows:

§ 63.110 Applicability.

* * * * *(g) Rules Stayed for Reconsideration.

Notwithstanding any other provision ofthis subpart, the effectiveness of subpartG is stayed from October 24, 1994, toApril 24, 1995 only as applied to thosesources for which the owner or operatormakes a representation in writing to theAdministrator that the resolution of thearea source definition issues could havean effect on the compliance status of thesource with respect to subpart G.

4. Section 63.160 is amended byrevising paragraph (d) to read asfollows:


* * * * *(d) Rules Stayed for Reconsideration.

Notwithstanding any other provision ofthis subpart, the effectiveness of subpartH is stayed from October 24, 1994, toApril 24, 1995 only as applied to thosesources for which the owner or operatormakes a representation in writing to theAdministrator that the resolution of thearea source definition issues could havean effect on the compliance status of thesource with respect to subpart H.

5. Section 63.190 is amended byrevising paragraphs (h) and (i) to read asfollows:


* * * * *(h) Rules Stayed for Reconsideration.

Notwithstanding any other provision ofthis subpart, the effectiveness of subpartI is stayed from October 24, 1994, toApril 24, 1995 only as applied to thosesources for which the owner or operatormakes a representation in writing to theAdministrator that the resolution of thearea source definition issues could havean effect on the compliance status of thesource with respect to subpart I.

(i) Sections Stayed forReconsideration. Notwithstanding anyother provision of this subpart, theeffectiveness of §§ 63.164 and 63.170 of

subpart H is stayed from October 28,1994 to April 24, 1995 only as appliedto those sources subject to§ 63.190(e)(2).

[FR Doc. 95–2129 Filed 1–24–95; 4:13 pm]BILLING CODE 6560–50–P

DEPARTMENT OF THE INTERIOR

Bureau of Land Management

43 CFR Public Land Order 7113

[CA–940–1430–01; CACA 16951]

Withdrawal of Public Land for the DogTown Historic Mining Site; California

AGENCY: Bureau of Land Management,Interior.ACTION: Public land order.

SUMMARY: This order withdraws 110acres of public land from mining for aperiod of 50 years for the Bureau ofLand Management to protect the DogTown Historic Mining Site. The landhas been and will remain open tomineral leasing.EFFECTIVE DATE: January 27, 1995.FOR FURTHER INFORMATION CONTACT:Duane Marti, BLM California StateOffice, 2800 Cottage Way, Sacramento,California 95825, 916–978–4820.

By virtue of the authority vested inthe Secretary of the Interior by Section204 of the Federal Land Policy andManagement Act of 1976, 43 U.S.C.1714 (1988), it is ordered as follows:

1. Subject to valid existing rights, thefollowing described public land ishereby withdrawn from location andentry under the United States mininglaws (30 U.S.C. Ch. 2 (1988)), but notfrom leasing under the mineral leasinglaws, to protect the Bureau of LandManagement’s Dog Town HistoricMining Site:

Mount Diablo Meridian

T. 4 N., R. 25 E.,Sec. 26, W1⁄2SW1⁄4SW1⁄4;Sec. 27, E1⁄2SE1⁄4NE1⁄4SE1⁄4, and SE1⁄4SE1⁄4;Sec. 34, N1⁄2NE1⁄4NE1⁄4, and

E1⁄2SE1⁄4NE1⁄4NE1⁄4;Sec. 35, W1⁄2NW1⁄4NW1⁄4.The area described contains 110 acres in

Mono County.

2. The withdrawal made by this orderdoes not alter the applicability of thosepublic land laws governing the use ofthe land under lease, license, or permit,or governing the disposal of theirmineral or vegetative resources otherthan under the mining laws.

3. This withdrawal will expire 50years from the effective date of thisorder unless, as a result of a reviewconducted before the expiration date


pursuant to Section 204(f) of the FederalLand Policy and Management Act of1976, 43 U.S.C. 1714(f) (1988), theSecretary determines that thewithdrawal shall be extended.

Dated: January 13, 1995.Bob Armstrong,Assistant Secretary of the Interior.[FR Doc. 95–2026 Filed 1–26–95; 8:45 am]BILLING CODE 4310–40–P

FEDERAL MARITIME COMMISSION

46 CFR Part 501

The Federal Maritime Commission;General Transfer of Office ofInformation Resources Management

AGENCY: Federal Maritime Commission.ACTION: Final rule; correction.

SUMMARY: This document contains acorrection to the Commission’s finalrule which was published December 5,1994 (59 FR 62329). The rule related tothe transfer of Office of InformationResources Management functions fromthe Bureau of Administration to theOffice of the Managing Director.EFFECTIVE DATE: January 27, 1995.FOR FURTHER INFORMATION CONTACT:Edward P. Walsh, Managing Director,Federal Maritime Commission, 800North Capitol Street NW., Washington,DC 20573, (202) 523–5800.SUPPLEMENTARY INFORMATION: The finalrule which is the subject of thiscorrection, inter alia, restated certainresponsibilities of the Bureau ofAdministration by revising theintroductory text of 46 CFR 501.5(k).This revision inadvertently omitted thelast three sentences of the existing textwhich were intended to be unchanged.

Accordingly, in FR Doc. 94–29741,published December 5, 1994, on page62330, first column, the introductorytext of § 501.5(k) is corrected to read asfollows:

§ 501.5 Functions of the organizationalcomponents of the Federal MaritimeCommission.

* * * * *(k) Under the direction and

management of the Bureau Director, theBureau of Administration is responsiblefor the administration and coordinationof the Offices of: AdministrativeServices; Budget and FinancialManagement; and Personnel. TheBureau provides administrative supportto the program operations of theCommission. The Bureau interpretsgovernmental policies and programsand administers these is a manner

consistent with Federal guidelines,including those involving procurement,financial management and personnel.The Bureau initiates recommendations,collaborating with other elements of theCommission as warranted, for long-range plans, new or revised policies andstandards, and rules and regulations,with respect to its program activities.The Office of the Bureau Director isresponsible for directing andadministering the Commission’straining and development function. TheBureau Director is the Commission’sCompetition Advocate under 41 U.S.C.418(a) and Commission Order No. 112,as well as the Commission’srepresentative, as Principal ManagementOfficial, to the Small Agency Council.Other Bureau programs are carried outby its Offices, as follows:* * * * *Joseph C. Polking,Secretary.[FR Doc. 95–2042 Filed 1–26–95; 8:45 am]BILLING CODE 6730–01–M

FEDERAL COMMUNICATIONSCOMMISSION

47 CFR Parts 0, 1, 25, 43, 64, and 73

[FCC 94–252]

Reorganization Establishing theInternational Bureau

AGENCY: Federal CommunicationsCommission.ACTION: Final rule.

SUMMARY: This order amends variousparts of the Federal CommunicationsCommission’s regulations to reflect thecreation of a new International Bureau,and the abolition of the old Office ofInternational Communications. Some ofthe changes affect the internal structureof the Commission; others affect thedelegation of authority from theCommission to the International Bureauand other bureaus and offices; andothers affect procedures for practicebefore the Commission.EFFECTIVE DATE: October 19, 1994.FOR FURTHER INFORMATION CONTACT:James L. Ball, (202) 418–0420.


Order

Adopted: September 27, 1994Released: October 19, 1994

By the Commission:1. The Commission has before it for

consideration a set of proposed rulechanges creating a new InternationalBureau. The proposed changes affect the

Office of International Communications,Mass Media Bureau, Common CarrierBureau, Field Operations Bureau,Private Radio Bureau, and Office ofEngineering and Technology.Implementation of the proposedchanges requires amendment of Parts 0,1, 25, 43, 64, and 73 of Title 47 of theCode of Federal Regulations.

2. In order to create an effectiveorganization in which to centralize andconsolidate the Commission’sinternational policies and activities, theCommission has determined to establishthe new International Bureau. Theamendments adopted in this Orderreflect the creation of the new bureau,describe its functions, and set forth theextent and nature of the authoritydelegated by the Commission to theChief of the International Bureau.

3. The amendments adopted hereinpertain to agency organization. Theprior notice procedure and effectivedate provisions of section 553 of theAdministrative Procedure Act aretherefore inapplicable. Authority for theamendments adopted herein iscontained in section 4(i), 5(b), 5(c)(1),and 303(r) of the Communications Actof 1934, as amended

4. It is hereby ordered, effective uponrelease of this Order, the Parts 0, 1, 25,43, 64, and 73 of the Commission’s rulesand regulations, set forth in Title 47 ofthe Code of Federal Regulations, beamended as set forth below.

List of Subjects

47 CFR Part 0

Organization and functions.

47 CFR Part 1

Administrative practice andprocedure, Communications commoncarriers, Radio, Reporting andrecordkeeping requirements,Telecommunications.

47 CFR Part 25

Radio, Satellites.

47 CFR Part 43

Communications common carriers,Reporting and recordkeepingrequirements, Telephone.

47 CFR Part 64

Communications common carriers,Foreign relations, Reporting andrecordkeeping requirements, Telephone.

47 CFR Part 73

Radio broadcasting, Televisionbroadcasting.


Federal Communications Commission.William F. Caton,Acting Secretary.

Final Rules

Parts 0, 1, 25, 43, 64, and 73 ofChapter I of Title 47 of the Code ofFederal Regulations are amended asfollows:

PART 0—COMMISSIONORGANIZATION

1. Section 0.5 is amended by revisingparagraph (a)(13) to read as follows:

§ 0.5 General description of Commissionorganization and operations.

(a) * * *(13) International Bureau.

* * * * *

§ 0.11 [Amended]

2. Section 0.11 is amended byremoving paragraph (a)(11).

§ 0.21 [Amended]

3. Section 0.21 is amended byremoving the words ‘‘domestic’’ and‘‘interagency’’ from paragraph (h),removing paragraph (i), andredesignating existing paragraph (j) asnew paragraph (i).

4. Section 0.31 is amended byremoving the last six words ofparagraph (f) and revising paragraph (b)to read as follows:

§ 0.31 Functions of the Office.

* * * * *(b) Represent the Commission at

various national conferences andmeetings (and, in consultation with theInternational Bureau, at variousinternational conferences and meetings)devoted to the progress ofcommunications and the developmentof technical and other information andstandards, and serve as Commissioncoordinator for the various nationalconferences when appropriate.* * * * *

5. Section 0.41 is amended byremoving paragraph (c); redesignatingexisting paragraphs (d) through (p) asnew paragraphs (c) through (o),respectively; and revising newlyredesignated paragraph (i) to read asfollows:

§ 0.41 Functions of the Office.

* * * * *(i) To cooperate with the International

Bureau on all matters pertaining tospace satellite communications.* * * * *

6. The heading ‘‘Office ofInternational Communications,’’ whichappears immediately before § 0.51, is

revised to read as follows:‘‘International Bureau.’’

7. Section 0.51 is revised to read asfollows:

§ 0.51 Functions of the Bureau.

The International Bureau has thefollowing duties and responsibilities:

(a) To initiate and direct thedevelopment and articulation ofinternational telecommunicationspolicies, consistent with the priorities ofthe Commission;

(b) To advise the Chairman andCommissioners on matters ofinternational telecommunicationspolicy, and on the adequacy of theCommission’s actions to promote thevital interests of the American public ininternational commerce, nationaldefense, and foreign policy;

(c) To develop, recommend, andadminister policies, rules, standards,and procedures for the authorizationand regulation of internationaltelecommunications facilities andservices, domestic and internationalsatellite systems, and internationalbroadcast services;

(d) To monitor compliance with theterms and conditions of authorizationsand licenses granted by the Bureau, andto pursue enforcement actions inconjunction with appropriate bureausand offices;

(e) To represent the Commission oninternational telecommunicationsmatters at both domestic andinternational conferences and meetings,and to direct and coordinate theCommission’s preparation for suchconferences and meetings;

(f) To serve as the single focal pointwithin the Commission for cooperationand consultation on internationaltelecommunications matters with otherfederal agencies, international or foreignorganizations, and appropriateregulatory bodies and officials of foreigngovernments;

(g) To develop, coordinate with otherfederal agencies, and administer theregulatory assistance and trainingprograms for foreign administrations topromote telecommunicationsdevelopment;

(h) To provide advice and technicalassistance to U.S. trade officials in thenegotiation and implementation oftelecommunications trade agreements,and consult with other bureaus andoffices as appropriate;

(i) To conduct economic, legal,technical, statistical, and otherappropriate studies, surveys, andanalyses in support of internationaltelecommunications policies andprograms.

(j) To collect and disseminate withinthe Commission information and dataon international telecommunicationspolicies, regulatory and marketdevelopments in other countries, andinternational organizations;

(k) To work with the Office ofLegislative Affairs to coordinate theCommission’s activities on significantmatters of international policy withappropriate Congressional offices;

(l) To promote the internationalcoordination of spectrum allocationsand frequency and orbital assignmentsso as to minimize cases of internationalradio interference involving U.S.licensees;

(m) To direct and coordinate, inconsultation with other bureaus andoffices as appropriate, negotiation ofinternational agreements to provide forarrangements and procedures forcoordination of radio frequencyassignments to prevent or resolveinternational radio interferenceinvolving U.S. licensees;

(n) To ensure fulfillment of theCommission’s responsibilities underinternational agreements and treatyobligations, and, consistent withCommission policy, to ensure that theCommission’s regulations, procedures,and frequency allocations comply withthe mandatory requirements of allapplicable international and bilateralagreements;

(o) To oversee and, as appropriate,administer activities pertaining to theinternational consultation, coordination,and notification of U.S. frequency andorbital assignments, including activitiesrequired by bilateral agreements, theinternational Radio Regulations, andother international agreements;

(p) To advise the Chairman onpriorities for international travel anddevelop, coordinate, and administer theinternational travel plan; and

(q) To develop, recommend, andadminister policies; rules, andregulations implementing theCommission’s oversight responsibilitiesregarding COMSAT’s participation inINTELSAT and INMARSAT.

§ 0.61 [Amended]8. Section 0.61 is amended by

removing paragraph (b) andredesignating paragraphs (c) through (h)as new paragraphs (b) through (g),respectively.

9. Section 0.91 is amended by revisingthe first two sentences of introductorytext to read as follows:

§ 0.91 Functions of the Bureau.The Common Carrier Bureau

develops, recommends, and administerspolicies and programs for the regulation


of services, facilities, and practices ofentities (excluding public coast stationsin the maritime mobile service andmulti-point and multi-channel multi-point distribution services) whichfurnish interstate communicationsservice or interstate access service forhire—whether by wire, terrestrial radio,or cable—and of ancillary operationsrelated to the provision or use of suchservices. The Bureau also develops,recommends, and administers policiesand programs for the regulation of therates, terms, and conditions underwhich communications entities furnishinterstate communications service,interstate access service, and (incooperation with the InternationalBureau) foreign communications servicefor hire—whether by wire, terrestrialradio, cable, or satellite. * * ** * * * *

10. Section 0.91 is further amendedby removing existing paragraphs (b), (d),and (k); redesignating existingparagraph (c) as new paragraph (b);redesignating existing paragraphs (e)through (j) as new paragraphs (c)through (h), respectively; redesignatingexisting paragraphs (l) through (n) asnew paragraphs (i) through (k),respectively; and revising newlyredesignated paragraph (i) to read asfollows:


* * * * *(i) Acts on matters affecting public

coast stations in the maritime servicewhich concern tariffs, terms ofinterconnection, and rate or economicanalysis.* * * * *

11. Section 0.111 is amended byrevising paragraph (e) to read as follows:


* * * * *(e) Participate in international

conferences dealing with monitoringand measurements; serve, inconsultation with the InternationalBureau, as the point of contact for theUnited States government in matters ofinternational monitoring, fixed andmobile direction finding, andinterference elimination.* * * * *

12. Section 0.131 is amended byremoving paragraph (b) andredesignating existing paragraphs (c)through (k) as new paragraphs (b)through (j), respectively.

§ 0.241 [Amended]

13. Section 0.241 is amended byremoving paragraph (a)(6) andredesignating existing paragraphs (a)(7)

through (a)(9) as new paragraphs (a)(6)through (a)(8), respectively.

14. A new center heading and a newsection 0.261 is added to Subpart B toread as follows:

International Bureau

§ 0.261 Authority delegated.(a) Subject to the limitations set forth

in paragraph (b) of this section, theChief, International Bureau, is herebydelegated the authority to perform thefunctions and activities described in§ 0.51, including without limitation thefollowing:

(1) To recommend rulemakings, studies,and analyses (legal, engineering, social, andeconomic) of various petitions for policy orrule changes submitted by industry or thepublic, and to assist the Commission inconducting the same;

(2) To assume the principalrepresentational role on behalf of theCommission in international conferences,meetings, and negotiations, and directCommission preparation for suchconferences, meetings, and negotiations withother bureaus and offices, as appropriate;

(3) To act upon applications forinternational telecommunications facilitiesand services pursuant to part 23 of thischapter and relevant portions of part 63 ofthis chapter, and coordinate with theCommon Carrier Bureau as appropriate;

(4) To act upon applications forinternational and domestic satellite systemsand earth stations pursuant to part 25 of thischapter;

(5) To act upon applications for cablelanding licenses pursuant to § 1.767 of thischapter;

(6) To act upon requests for designation ofRecognized Private Operating Agency(RPOA) status under part 63 of this chapter;

(7) To act upon applications relating tointernational broadcast station operations, orfor permission to deliver programming toforeign stations, under part 73 of this chapter;

(8) To administer and enforce the policiesand rules on international settlements underpart 64 of this chapter;

(9) To administer portions of part 2 of thischapter dealing with international treatiesand call sign provisions, and to make callsign assignments, individually and in blocks,to U.S. Government agencies and FCCoperating bureaus;

(10) To act upon applications for closure ofpublic coast stations in the maritime serviceunder part 63 of this chapter;

(11) To administer Commissionparticipation in the InternationalTelecommunication Union (ITU) Fellowshiptelecommunication training program forforeign officials offered through the U.S.Telecommunications Training Institute;

(12) In consultation with the affectedBureaus and Offices, to recommend revisionof Commission rules and procedures asappropriate to conform to the outcomes ofinternational conferences, agreements, ortreaties;

(13) To notify the ITU of the United States’terrestrial and satellite assignments for

inclusion in the Master InternationalFrequency Register;

(14) To conduct studies and compile suchdata relating to internationaltelecommunications as may be necessary forthe Commission to develop and maintain anadequate regulatory program; and

(15) To interpret and enforce rules andregulations pertaining to matters under itsjurisdiction.

(b) Notwithstanding the authoritydelegated in paragraph (a) of this section, theChief, International Bureau, shall not haveauthority:

(1) To act on any application, petition,pleading, complaint, enforcement matter, orother request that:

(i) Presents new or novel arguments notpreviously considered by the Commission;

(ii) Presents facts or arguments whichappear to justify a change in Commissionpolicy; or

(iii) Cannot be resolved under outstandingprecedents and guidelines after consultationwith appropriate Bureaus or Offices.

(2) To issue notices of proposedrulemaking, notices of inquiry, or reports ororders arising from rulemaking or inquiryproceedings;

(3) To act upon any application for reviewof actions taken by the Chief, InternationalBureau, pursuant to delegated authority,which application complies with § 1.115 ofthis chapter;

(4) To act upon any formal or informalradio application or section 214 applicationfor common carrier services which is inhearing status;

(5) To designate for hearing anyapplications except:

(i) Mutually exclusive applications forradio facilities filed pursuant to part 23, 25,or 73 of this chapter; and

(ii) Applications for facilities where theissues presented relate solely to whether theapplicant has complied with outstandingprecedents and guidelines; or

(6) To impose, reduce, or cancel forfeiturespursuant to section 203 or section 503(b) ofthe Communications Act of 1934, asamended, in amounts of more than $20,000.

15. A new section 0.262 is added toSubpart B to read as follows:

§ 0.262 Record of actions taken.The application and authorization

files in the appropriate central files ofthe International Bureau are designatedas the Commission’s official records ofactions by the Chief, InternationalBureau, pursuant to authority delegatedto him.

16. Section 0.291 is amended byremoving paragraph (d), redesignatingexisting paragraphs (e) through (i) asnew paragraphs (d) through (h),respectively; and revising newlyredesignated paragraphs (d), (g), and (h)to read as follows:

§ 0.291 Authority delegated.

* * * * *(d) Authority to designate for hearing.

The Chief, Common Carrier Bureau,


shall not have authority to designate forhearing any formal complaints whichpresent novel questions of fact, law, orpolicy which cannot be resolved underoutstanding precedents or guidelines.The Chief, Common Carrier Bureau,shall not have authority to designate forhearing any applications except:

(1) Applications for radio facilities filedpursuant to parts 21 or 22 of this chapterwhich are mutually exclusive and

(2) Applications for facilities where theissues presented relate solely to whether theapplicant has complied with outstandingprecedents and guidelines.

* * * * *(g) Authority concerning rulemaking

and investigatory proceedings. TheChief, Common Carrier Bureau, shallnot have authority to issue notices ofproposed rulemaking, notices ofinquiry, or reports or orders arising fromeither of the foregoing, except that theChief, Common Carrier Bureau, shallhave authority, in consultation andcoordination with the Chief,International Bureau, to issue and revisea manual on the details of the reportingrequirements for international carriersset forth in § 43.61(d) of this chapter.

(h) Authority concerning public coaststations in the maritime service. TheChief, Common Carrier Bureau, shallhave authority to act on mattersaffecting public coast stations in themaritime service which concern tariffsand rates and terms of interconnection.

17. Section 0.332 is amended byremoving paragraph (b), redesignatingexisting paragraphs (c) through (i) asnew paragraphs (b) through (h)respectively; and revising newlyredesignated paragraph (f) to read asfollows:

§ 0.332 Actions taken under delegatedauthority.* * * * *

(f) Requests involving coordinationwith other Federal or state agencieswhen appropriate—Office of GeneralCounsel, Office of Engineering andTechnology or operating bureau.* * * * *

18. Section 0.401 is amended byrevising paragraph (b)(1) to read asfollows:

§ 0.401 Location of Commission offices.* * * * *

(b) * * *(1) Applications and filings submitted

by mail shall be addressed to the MellonBank in Pittsburgh, Pennsylvania. Thebank maintains separate post officeboxes for the receipt of different typesof applications. It will also establishspecial post office boxes to receiveresponses to special filings such asapplications filed in response to ‘‘filingwindows’’ established by theCommission. The address for thesubmission of filings will be establishedin the Public Notice announcing thefiling dates. In all other cases,applications and filings submitted bymail should be sent to the addresseslisted in the appropriate fee rules insubpart G of part 1 of this chapter(§§ 1.102 through 1.1107 of thischapter).* * * * *

§ 0.401 [Amended]

19. Section 0.401 is further amendedby removing the parenthetical‘‘(§§ 1.1102–1.1105)’’ from paragraph(b)(2) and adding in its place thefollowing: ‘‘(§§ 1.1102–1.1107).’’

20. Section 0.453 is amended byremoving paragraph (d)(1);redesignating existing paragraphs (d)(2)and (d)(3) as new paragraphs (d)(1) and(d)(2), respectively; removing paragraph(g)(3); and revising paragraph (g)(2) andadding a new paragraph (m) to read asfollows:

§ 0.453 Public reference rooms.

* * * * *(g) * * *(2) Section 214 applications and

related files, to the extent that theyconcern domestic communicationsfacilities and services.* * * * *

(m) The International BureauReference Room. Except to the extentthey are excluded from routine publicinspection under another section of thischapter, the following documents, files,and records are available for inspectionat this location:

(1) Satellite and earth station applicationfiles and related materials under part 25 ofthis chapter;

(2) Section 214 applications and relatedfiles under part 63 of this chapter, to the

extent that they concern internationalcommunications facilities and services;

(3) International Fixed Public Radioapplications and related files under part 23of this chapter;

(4) Files relating to submarine cablelanding licenses and applications for suchlicenses since June 30, 1934, except for mapsshowing the exact location of submarinecables, which are withheld from inspectionunder section 4(j) of the Communications Act(see §§ 0.457(c)(1)(i));

(5) Files relating to internationalsettlements under part 64 of this chapter;

(6) Documents relating to INTELSAT orINMARSAT;

(7) International broadcast applications,applications for permission to deliverprogramming to foreign stations, and relatedfiles under part 73 of this chapter; and

(8) International settlement agreements andcontracts and international cable agreements.

21. Section 0.455 is amended byremoving paragraph (b)(14);redesignating existing paragraphs (b)(15)and (b)(16) as new paragraphs (b)(14)and (b)(15), respectively; and revisingparagraph (b)(12) and adding a newparagraph (g) to read as follows:

§ 0.455 Other locations at which recordsmay be inspected.

* * * * *(b) * * *(12) All applications for common

carrier authorizations acted upon by theCommon Carrier Bureau, and filesrelating thereto.* * * * *

(g) International Bureau. The treatiesand other international and bilateralagreements listed in § 73.1650 of thischapter are available for inspection inthe office of the Chief, Planning andNegotiations Division, InternationalBureau.

PART 1—PRACTICE ANDPROCEDURE

§ 1.1104 [Amended]

22. Section 1.1104 is amended byremoving entry 8 and redesignatingexisting entry 9 as new entry 8.

23. Section 1.1105 is amended byremoving entries 10 through 19;redesignating existing entries 20through 22 as new entries 10 through12; and revising entry 9 to read asfollows:

§ 1.1105 Schedule of charges for common carrier services.

Action FCC form No. Feeamount

Fee typecode Address

* * * * * * *9. Section 214 Applications:


Action FCC form No. Feeamount

Fee typecode Address

a. Domestic Cable Construc-tion.

Corr. and 159 . $705 CUT Federal Communications Commission, Common Carrier Dom.Services, P.O. Box 358145, Pittsburgh, PA 15251–5145.

b. All Other Domestic 214Applications.

Corr. and 159 . 705 CUT Federal Communications Commission, Common Carrier Dom.Services, P.O. Box 358145, Pittsburgh, PA 15251–5145.

c. Special Temporary Author-ity (all domestic services).

Corr. and 159 . 705 CUT Federal Communications Commissions, Common Carrier Dom.Services, P.O. Box 358145, Pittsburgh, PA 15251–5145.

d. Assignments or Transfers(all domestic services).

Corr. and 159 . 705 CUT Federal Communications Commission, Common Carrier Dom.Services, P.O. Box 358145, Pittsburgh, PA 15251–5145.

* * * * * * *

§§ 1.1107–1.1118 [Redesignated as §§ 1.1108–1.1119]

24. Sections 1.1107 through 1.1118 are redesignated as sections 1.1108 through 1.1119.25. A new § 1.1107 is added to Subpart G to read as follows:

§ 1.1107 Schedule of charges for international and satellite services.

Action FCC form No. Fee amount Fee typecode Address

1. International Broadcast Sta-tions:

a. New Station and Facili-ties Change CP.

309 ...................... $1,960 MSN Federal Communications Commission, Planning and Negotia-tions Div’n, P.O. Box 358200, Pittsburgh, PA 15251–5200.

b. License ........................... 310 ...................... 445 MNN Federal Communications Commission, Planning and Negotia-tions Div’n, P.O. Box 358200, Pittsburgh, PA 15251–5200.

c. Assignment or Transfer(per station).

314, 315, 316 ..... 70 MCN Federal Communications Commission, Planning and Negotia-tions Div’n, P.O. Box 358200, Pittsburgh, PA 15251–5200.

d. Renewal ......................... 311 ...................... 110 MFN Federal Communications Commission, Planning and Negotia-tions Div’n, P.O. Box 358200, Pittsburgh, PA 15251–5200.

e. Frequency Assignmentand Coordination (perfrequency hour).

N/A ...................... 45 MAN Federal Communications Commission, Planning and Negotia-tions Div’n, P.O. Box 358175, Pittsburgh, PA 15251–5175.

f. Special Temporary Au-thority (other than to re-main silent or extend anexisting STA to remainsilent).

N/A ...................... 115 MGN Federal Communications Commission, Planning and Negotia-tions Div’n, P.O. Box 358175, Pittsburgh, PA 15251–5175.

2. International Fixed PublicRadio (Public and ControlStations):

a. Initial Construction Au-thorization (per station).

407 and 159 ....... 590 CSN Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

b. Assignment or Transfer(per application).

702 or 704 .......... 590 CSN Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

c. Renewal (per license) .... 405 ...................... 425 CON Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

d. Modification (per station) 403 ...................... 425 CON Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

e. Extension of Construc-tion Authorization (perstation).

701 ...................... 215 CKN Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

f. Special Temporary Au-thority or Request forWaiver (per request).

Corr. and 159 ..... 215 CKN Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

3. Fixed Satellite Transmit/Re-ceive Earth Stations:

a. Initial Application (perapplication):

(i) Domestic ................. 493 and 159 ....... 1,755 BAX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 493 and 159 ....... 1,755 BAX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.



b. Modification of License(per station):

(i) Domestic ................. 493 and 159 ....... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 493 and 159 ....... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

c. Assignment or Transfer:(i) First station on ap-

plication:(a) Domestic ........ 702 or 704 .......... 345 CNX Federal Communications Commission, Satellite and

Radiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(b) International ... 702 or 704 .......... 345 CNX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

(ii) Each additional sta-tion:

(a) Domestic ........ 702 or 704 .......... 115 CFX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(b) International ... 702 or 704 .......... 115 CFX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

d. Developmental Station(per station):

(i) Domestic ................. 493 and 159 ....... 1,150 CWX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 493 and 159 ....... 1,150 CWX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

e. Renewal of License (perstation):

(i) Domestic ................. 405 ...................... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 405 ...................... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

f. Special Temporary Au-thority or Waivers of PriorConstruction Authoriza-tion (per request):

(i) Domestic ................. Corr. and 159 ..... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 125 CGS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

g. Amendment of Applica-tion (per request):

(i) Domestic ................. Corr. and 159 ..... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA l5251–5160.

(ii) International ........... Corr. and 159 ..... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

h. Extension of Construc-tion Permit (per station):

(i) Domestic ................. 701 ...................... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 701 ...................... 125 CGX Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

4. Fixed Satellite Small Trans-mit/Receive Earth Stations (2meters or less and operatingin the 4/6 GHz frequencyband):



a. Lead Application ............ 493 and 159 ....... 3,885 BDS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

b. Routine application (perstation).

493 and 159 ....... 45 CAS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

c. Modification of License(per station).

493 and 159 ....... 125 CGS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

d. Assignment or Transfer:(i) First station on ap-

plication.702 and 704 ....... 345 CNS Federal Communications Commission, Satellite and


(ii) Each additional sta-tion.

702 or 704 .......... 45 CAS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

e. Developmental Station(per station).

493 and 159 ....... 1,150 CWS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

f. Renewal of License (perstation).

405 ...................... 125 CGS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

g. Special Temporary Au-thority or Waivers of PriorConstruction Authoriza-tion (per request).

Corr. and 159 ..... 125 CGS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

h. Amendment of Applica-tion (per station).

Corr. and 159 ..... 125 CGS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

i. Extension of ConstructionPermit (per station).

701 ...................... 125 CGS Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

5. Receive Only Earth Stations:a. Initial Application for

Registration:(i) Domestic ................. 493 and 159 ....... 265 CMO Federal Communications Commission, Satellite and


(ii) International ........... 493 and 159 ....... 265 CMO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

b. Modification of Licenseor Registration (per sta-tion):

(i) Domestic ................. 493 and 159 ....... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 493 and 159 ....... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

c. Assignment or Transfer:(i) First station on ap-

plication:(a) Domestic ........ 702 or 704 .......... 345 CNO Federal Communications Commission, Satellite and


(b) International ... 702 or 704 .......... 345 CNO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

(ii) Each additional sta-tion:

(a) Domestic ........ 702 or 704 .......... 115 CFO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(b) International ... 702 or 704 .......... 115 CFO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

d. Renewal of License (perstation):

(i) Domestic ................. 405 ...................... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.



(ii) International ........... 405 ...................... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

e. Amendment of Applica-tion (per station):

(i) Domestic ................. Corr. and 159 ..... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

f. Extension of ConstructionPermit (per station):

(i) Domestic ................. 701 ...................... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 701 ...................... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

g. Waivers (per request):(i) Domestic ................. Corr. and 159 ..... 125 CGO Federal Communications Commission, Satellite and


(ii) International ........... Corr. and 159 ..... 125 CGO Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

6. Fixed Satellite Very SmallAperture Terminal (VSAT)Systems:

a. Initial Application (persystem).

493 and 159 ....... 6,465 BGV Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

b. Modification of License(per system).

493 and 159 ....... 125 CGV Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

c. Assignment or Transferof System.

702 or 704 .......... 1,730 CZU Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

d. Developmental Station ... 493 and 159 ....... 1,150 CWV Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

e. Renewal of License ....... 405 ...................... 125 CGV Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

f. Special Temporary Au-thority or Waivers of PriorConstruction Authoriza-tion (per request).

Corr. and 159 ..... 125 CGV Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

g. Amendment of Applica-tion (per system).

Corr. and 159 ..... 125 CGV Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

h. Extension of Construc-tion Permit (per system).

701 ...................... 125 CGV Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

7. Mobile Satellite Earth Sta-tions:

a. Initial Application ofBlanket Authorization.

493 and 159 ....... 6,465 BGB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

b. Initial Application for Indi-vidual Earth Station.

493 and 159 ....... 1,550 CYB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

c. Modification of License(per system).

493 and 159 ....... 125 CGB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

d. Assignment or Transfer(per system).

702 or 704 .......... 1,730 CZB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

e. Developmental Station ... 493 and 195 ....... 1,150 CWB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.



f. Renewal of License (persystem).

405 ...................... 125 CGB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.


Corr. and 159 ..... 125 CGB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

h. Amendment of Applica-tion (per system).

Corr. and 159 ..... 125 CGB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

i. Extension of ConstructionPermit (per system).

701 ...................... 125 CGB Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

8. Radio Determination SatelliteEarth Station:

a. Initial Application ofBlanket Authorization.

493 and 159 ....... 6,465 BGH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

b. Initial Application for Indi-vidual Earth Station.

493 and 159 ....... 1,550 CYH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

c. Modification of License(per system).

493 and 159 ....... 125 CGH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

d. Assignment or Transfer(per system).

702 or 704 .......... 1,730 CZH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

e. Developmental Station ... 493 and 159 ....... 1,150 CWH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

f. Renewal of License (persystem).

405 ...................... 125 CGH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.


Corr. and 159 ..... 125 CGH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

h. Amendment of Applica-tion (per system).

Corr. and 159 ..... 125 CGH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

i. Extension of ConstructionPermit (per system).

701 ...................... 125 CGH Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

9. Space Stations:a. Application for Authority

to Construct:(i) Domestic ................. Corr. and 159 ..... 2,330 BBY Federal Communications Commission, Satellite and


(ii) International ........... Corr. and 159 ..... 2,330 BBY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

b. Application for Authorityto Launch and Operate:

(i) Initial application:(a) Domestic ........ Corr. and 159 ..... 80,360 BNY Federal Communications Commission, Satellite and


(b) International ... Corr. and 159 ..... 80,360 BNY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

(ii) Replacement sat-ellite:

(a) Domestic ........ Corr. and 159 ..... 80,360 BNY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(b) International ... Corr. and 159 ..... 80,360 BNY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.



c. Assignment or Transfer(per satellite):

(i) Domestic ................. 702 or 704 .......... 5,740 BFY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 702 or 704 .......... 5,740 BFY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

d. Modification (per re-quest):

(i) Domestic ................. Corr. and 159 ..... 5,740 BFY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 5,740 BFY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

e. Special Temporary Au-thority or Waiver of PriorConstruction Authoriza-tion (per request):

(i) Domestic ................. Corr. and 159 ..... 575 CRY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 575 CRY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

f. Amendment of Applica-tion:

(i) Domestic ................. Corr. and 159 ..... 1,150 CWY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 1,150 CWY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

g. Extension of Construc-tion Permit/Launch Au-thorization (per request):

(i) Domestic ................. Corr. and 159 ..... 575 CRY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 575 CRY Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

10. Space Stations (Low Orbit):a. Application for Authority

to Construct:(i) Domestic ................. Corr. and 159 ..... 6,890 CZW Federal Communications Commission, Satellite and


(ii) International ........... Corr. and 159 ..... 6,890 CZW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

b. Application for Authorityto Launch and Operate:

(i) Domestic ................. Corr. and 159 ..... 241,080 CLW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 241,080 CLW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

c. Assignment or Transfer(per satellite):

(i) Domestic ................. 702 or 704 .......... 6,890 CZW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... 702 or 704 .......... 6,890 CZW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

d. Modification (per re-quest):

(i) Domestic ................. Corr. and 159 ..... 17,220 CGW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.



(ii) International ........... Corr. and 159 ..... 17,220 CGW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

e. Special Temporary Au-thority or Waiver of PriorConstruction Authoriza-tion (per request):

(i) Domestic ................. Corr. and 159 ..... 1,725 CXW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 1,725 CXW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

f. Amendment of Applica-tion:

(i) Domestic ................. Corr. and 159 ..... 3,445 CAW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 3,445 CAW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

g. Extension of Construc-tion Permit/Launch Au-thorization (per request):

(i) Domestic ................. Corr. and 159 ..... 1,725 CXW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358160, Pittsburgh,PA 15251–5160.

(ii) International ........... Corr. and 159 ..... 1,725 CXW Federal Communications Commission, Satellite andRadiocommunication Div’n, P.O. Box 358115, Pittsburgh,PA 15251–5115.

11. Section 214 Cable Con-struction:

a. Overseas Cable Con-struction.

Corr. and 159 ..... 10,480 BIT Federal Communications Commission, IB TelecommunicationsDiv’n, P.O. Box 358115, Pittsburgh, PA 15251–5115.

b. Cable Landing License:(i) Common carrier ...... Corr. and 159 ..... 1,180 CXT Federal Communications Commission, IB Telecommunications

Div’n, P.O. Box 358115, Pittsburgh, PA 15251–5115.(ii) Replacement sat-

ellite.Corr. and 159 ..... 11,655 BJT Federal Communications Commission, IB Telecommunications

Div’n, P.O. Box 358115, Pittsburgh, PA 15251–5115.c. All Other International

Applications Under Sec-tion 214.

Corr. and 159 ..... 705 CUT Federal Communications Commission, IB TelecommunicationsDiv’n, P.O. Box 358115, Pittsburgh, PA 15251–5115.

d. Special Temporary Au-thority (all internationalservices).


e. Assignments or Trans-fers (all internationalservices).


12. Recognized Private Operat-ing Status (per application).


§ 1.1153 [Amended]

26. Section 1.1153 is amended by removing ‘‘International (HF) Broadcast’’ from the list of services and deletingthe corresponding fee and address information from the table appearing in that section.

27.Section 1.1154 is revised to read as follows:

§ 1.1154 Schedule of annual regulatory changes and filing locations for common carrier services.

Services Feeamount Address

Radio Facilities:1. Cellular Radio (per 1,000 subscribers) ............................ $60 FCC, Cellular, P.O. Box 358835, Pittsburgh, PA 15251–5835.2. Personal Communications ............................................... 60 FCC, Cellular, P.O. Box 358835, Pittsburgh, PA 15251–5835.3. Public Mobile (per 1,000 subscribers) ............................. 60 FCC, Cellular, P.O. Box 358835, Pittsburgh, PA 15251–5835.4. Domestic Public Fixed ..................................................... 55 FCC, Cellular, P.O. Box 358835, Pittsburgh, PA 15251–5835.

Carriers:1. Inter-Exchange Carrier (per 1,000 presubscribed lines) . 60 FCC, Carriers, P.O. Box 358835, Pittsburgh, PA 15251–5835.2. Local Exchange Carrier (per 1,000 access lines) ........... 60 FCC, Carriers, P.O. Box 358835, Pittsburgh, PA 15251–5835.3. Competitive Access Provider (per 1,000 subscribers) .... 60 FCC, Carriers, P.O. Box 358835, Pittsburgh, PA 15251–5835.


§§ 1.1156–1.1166 [Redesignated as §§ 1.1158–1.1168]

28. Sections 1.1156 through 1.1166 are redesignated as new sections 1.1158 through 1.1168.29. A new § 1.1156 is added to subpart G, to read as follows:

§ 1.1156 Schedule of regulatory fees and filing locations for international and satellite services.

Services Fee amount Address

Radio Facilities:1. Space Stations (geo-

stationary orbit).$65,000 FCC, Satellite and Radiocommunication Div’n, P.O. Box 358835, Pittsburgh, PA 15251–5835.

2. Space Stations (lowearth orbit).

90,000 FCC, Satellite and Radiocommunication Div’n, P.O. Box 358835, Pittsburgh, PA 15251–5835.

3. International Public Fixed 110 FCC, Satellite and Radiocommunication Div’n, P.O. Box 358835, Pittsburgh, PA 15251–5835.Earth Stations:

1. VSAT and Equivalent C-Band antennas (per 100antennas).

6 FCC, Satellite and Radiocommunication Div’n, P.O. Box 358835, Pittsburgh, PA 15251–5835.

2. Mobile Satellite EarthStations (per 100 anten-nas).


3. Less than Nine Meters(per 100 antennas).


4. Nine Meters or More:.a. Transmit/Receive

and Transmit Only(per meter).


b. Receive Only (permeter).


Carriers:1. International Circuits (per

100 active 64 KB circuitsor equivalent).

220 FCC, IB Telecommunications Div’n, P.O. Box 358835, Pittsburgh, PA 15251–5835.

International (HF) Broadcast ..... 200 FCC, Planning and Negotiations Div’n, P.O. Box 358835, Pittsburgh, PA 15251–5835.

§ 1.1157 [Reserved]

30. Section 1.1157 is reserved.

PART 25—SATELLITECOMMUNICATIONS

31. Section 25.110 is amended byrevising paragraph (b) to read as follows:

§ 25.110 Filing of applications, fees, andnumber of copies.

* * * * *(b) Applications for satellite radio

station authorizations governed by thispart and requiring a fee shall be mailedor hand-delivered to the locationspecified in part 1, subpart G of thischapter. All other applications shall besubmitted to the Secretary, 1919 MStreet NW, Washington, DC 20554, andaddressed to the attention of Chief,Satellite and Spectrum ManagementDivision.* * * * *

PART 43—REPORTS OFCOMMUNICATION COMMONCARRIERS AND CERTAIN AFFILIATES

32. Section 43.61 is amended byrevising paragraph (d) to read asfollows:

§ 43.61 Reports of internationaltelecommunications traffic.

* * * * *

(d) The information required underthis section shall be furnished inconformance with the instructions andreporting requirements prepared underthe direction of the Chief, CommonCarrier Bureau, prepared and publishedas a manual, in consultation andcoordination with the Chief,International Bureau.

§ 43.81 [Amended]33. Section 43.81 is amended by

removing the words ‘‘Common CarrierBureau’’ from paragraph (b) andinserting in their place the words‘‘International Bureau’’.

PART 64—MISCELLANEOUS RULESRELATING TO COMMON CARRIERS

34. Section 64.1001 is amended byremoving the words ‘‘Common CarrierBureau’’ from paragraph (l)(2), andreplacing them with the words‘‘International Bureau’’.

PART 73—RADIO BROADCASTSERVICES

35. Section 73.1650 is amended byrevising the second-to-last sentence toread as follows:

§ 73.1650 International agreements.

* * * * ** * * The documents listed in this

paragraph are available for inspection in

the office of the Chief, Planning andNegotiations Division, InternationalBureau, FCC, Washington, D.C. * * *


47 CFR Part 24

[PP Docket No. 93–253; DA 95–19]

Implementation of Section 309(j) of theCommunications Act—CompetitiveBidding

AGENCY: Federal CommunicationsCommission.ACTION: Final rule; correction.

SUMMARY: This document containscorrections to the final regulations,which were published December 7,1994 (59 FR 63210). The regulationsrelated to the broadband PCS auctionrules.EFFECTIVE DATE: February 6, 1995.FOR FURTHER INFORMATION CONTACT:Sue McNeil (202) 418–0620.


BackgroundThe final regulations that are the

subject of these corrections set forthrules which are designed to ensure thatsmall businesses, rural telephonecompanies and businesses owned by


35 See Media Communications Partners ex partecomments, filed Oct. 11, 1994, at 7–8.

35a For instance, if a pre-existing company wantsto qualify as a small business control group, itsgross revenues and total assets will be added to thegross revenues and assets of each of its controllingshareholders and to those of all affiliates. Theresulting sum must be under $40 million in grossrevenues and $500 million in total assets. The grossrevenues and total assets of the company’s pre-existing, noncontrolling shareholders will beignored, however.

35bSee note 162 infra (explaining definition ofinstitutional investors).

35c See, e.g., BET Petition at 16; Columbia PCSPetition at 2–3; Omnipoint Petition at 9.

36 For our purposes, we define institutionalinvestors in a manner that is similar to thedefinition that is used by the Commission in theattribution rules applied to assess compliance withthe broadcast multiple ownership rules. We modifythat definition slightly, however, to fit this service.Specifically, we expect that investment companieswill be important sources of capital formation fordesignated entities. Accordingly, we adopt adefinition that specifically includes venture capitalfirms and other smaller investment companies thatmay not be included in the definition of investmentcompanies found in 15 U.S.C. 80a–3 (which is citedin our broadcast rules at 47 CFR Sec. 73.3555 Note2(c)). Specifically, we define an institutionalinvestor as an insurance company, a bank holdingstock in trust accounts through its trust department,or an investment company as defined under 15U.S.C. 80a–3(a). We include in the definition anyentity that would otherwise meet the definition ofinvestment company under 15 U.S.C. 80a–3(a), butis excluded by the exemptions set forth in 15 U.S.C.80A–3(b) and (c) and we do so without regard towhether the entity is an issue of securities.However, if the investment company is owned, inwhole or in part, by other entities, the investmentcompany, other entities and affiliates of otherentities, taken as a whole, must be primarilyengaged in the business of investing, reinvesting ortrading in securities or in distributing or providinginvestment management services for securities, SeeSection 24.720(h).

minorities and women have theopportunity to compete for and obtainlicenses for broadband personalcommunications services (broadbandPCS) and to attract the investmentcapital needed to have meaningfulinvolvement in building and managingthis nation’s broadband PCSinfrastructure.

Need for CorrectionAs published, the final regulations

contain errors which may prove to bemisleading and are in need ofclarification.

Correction of PublicationAccordingly, the publication on

December 7, 1994 of the finalregulations, which were the subject ofPP Docket No. 93–253, is corrected asfollows:

1. Paragraph 64 of the text on page63221, col. 1 is corrected to read asfollows:

64. Specifically, we will retain the 25percent minimum equity requirementfor the control group, but we willrequire only 15 percent (i.e., 60 percentof the control group’s 25 percent equityholdings) to be held by qualifying,controlling principals in the controlgroup (i.e., minorities, women or small/entrepreneurial business principals).35

For example, if the applicant seeksminority or women-owned status, the 15percent equity, as well as 50.1 percentof the voting stock of the control groupand all of its general partnershipinterests, must be owned by controlgroup members who are minorities and/or women. If the applicant seeks smallbusiness status, 15 percent of the equity,as well as 50.1 percent of the controlgroup’s voting stock and all of itsgeneral partnership interests, must beheld by control group members who, inthe aggregate, qualify as a smallbusiness.35a With regard to establishingcontrol of the applicant by qualifiedinvestors, where the control group iscomposed of both qualifying andnonqualifying members, the qualifyingmembers in the control group must have50.1 percent of the voting stock and allgeneral partnership interests within thecontrol group, and maintain de factocontrol of the control group. The control

group, in turn, must hold 50.1 percentof the voting stock and all generalpartnership interests of the PCSapplicant. Thus, qualifying members ofthe control group will have de jure andde facto control of both the controlgroup and, indirectly, the applicant. Thecomposition of the principals of thecontrol group and their legal and activecontrol of the applicant determineswhether the applicant qualifies forbidding credits, installment paymentsand reduced upfront payments. The 15percent minimum equity amount maybe held in the form of options, providedthese options are exercisable at anytime, solely at the holder’s discretion,and at an exercise price equal to or lessthan the current market valuation of theunderlying shares at the time of short-form filing. The remaining 10 percent(i.e., 40 percent of the control group’sminimum equity holdings) may be heldin the form of either stock options orshares, and we will allow certaininvestors that are not minorities,women, small businesses, orentrepreneurs to hold interests in suchshares or options. Specifically, we willallow the 10 percent portion to be heldin the form of shares or options byqualifying investors or by any of thefollowing entities which may notcomply with the entrepreneurs’ blockrequirements (e.g. investors who are notminorities or women or investors, and/or their affiliates, that exceed theentrepreneurs’ block or small businesssize thresholds): (1) individuals who aremembers of an applicant’s managementteam; (2) existing investors of businessesin the control group that were operatingand earning revenues for two years priorto December 31, 1994; or (3)noncontrolling institutionalinvestors.35b

2. Paragraph 65 of the text on page63221, col. 2 is corrected to read asfollows:

65. As discussed supra at paragraph59, the Commission also adopted analternative to the 25 percent minimumequity requirement for minority andwomen-owned businesses, whichpermits a single investor to hold asmuch as 49.9 percent of its equity,provided the control group holds atleast 50.1 percent. Several petitionershave expressed similar concerns withrespect to the need to revise the 50.1percent requirement.35c Therefore, intandem with, and for the same reasonsas, the modifications to the 25 percentequity requirement, we make similar

modifications to the rules governing the50.1 percent minimum equityrequirement. Accordingly, where aminority or women-owned businessuses the 50.1 percent minimum equityoption, we will require only 30 percentof the total equity to be held by theprincipals of the control group that areminorities or women. The 30 percentmay be held in the form of options,provided these options are exercisableat any time, solely at the holder’sdiscretion, and at an exercise priceequal to or less than the current marketvaluation of the underlying shares at thetime of short-form filing. The remaining20.1 percent may be made up of sharesand/or options held by investors that arenot women or minorities under similarcriteria described in paragraph 64above. That is, the 20.1 percent portionof the control group’s equity may beheld in the form of shares or stockoptions by qualifying investors or byany of the following entities which maynot comply with the entrepreneurs’block requirements (e.g. investors whoare not minorities or women orinvestors, and/or their affiliates, thatexceed the entrepreneurs’ block or smallbusiness size thresholds): (1)individuals who are members of anapplicant’s management team; (2)existing investors of businesses in thecontrol group that were operating andearning revenues for two years prior toDecember 31, 1994; or (3)noncontrolling institutional investors.36


§ 24.709 [Corrected]3. Section 24.709(b)(5)(i) (B) and (C)

on page 63233, col. 2 are corrected toread as follows:* * * * *

(b) * * *(5) * * *(i) * * *(B) Such qualifying investors must

hold 50.1 percent of the voting stockand all general partnership interestswithin the control group, and must havede facto control of the control group andof the applicant;

(C) The remaining 10 percent of theapplicant’s (or licensee’s) total equitymay be owned by qualifying investors,either unconditionally or in the form ofstock options not subject to therestrictions of paragraph (b)(5)(i)(A) ofthis section, or by any of the followingentities, which may not comply with§ 24.720(n)(1):

(1) Institutional investors, eitherunconditionally or in the form of stockoptions;

(2) Noncontrolling existing investorsin any preexisting entity that is amember of the control group, eitherunconditionally or in the form of stockoptions; or

(3) Individuals that are members ofthe applicant’s (or licenses’s)management, either unconditionally orin the form of stock options.* * * * *

§ 24.709 [Corrected]4. Section 24. 709(b)(6)(i) (B) and (C),

on page 63233, col. 3 are corrected toread as follows:* * * * *

(b) * * *(6) * * *(i) * * *(B) Such qualifying minority and/or

women investors must hold 50.1 percentof the voting stock and all generalpartnership interests within the controlgroup and must have de facto control ofthe control group and of the applicant;

(C) The remaining 20.1 percent of theapplicant’s (or licensee’s) total equitymay be owned by qualifying investors,either unconditionally or in the form ofstock options not subject to therestrictions of paragraph (b)(5)(i)(A) ofthis section, or by any of the followingentities, which may not comply with§ 24.720(n)(1):

(1) Institutional investors, eitherunconditionally or in the form of stockoptions;

(2) Noncontrolling existing investorsin any preexisting entity that is amember of the control group, eitherunconditionally or in the form of stockoptions; or

(3) Individuals that are members ofthe applicant’s (or licensee’s)management, either unconditionally orin the form of stock options.* * * * *

§ 24.711 [Corrected]5. Sections 24.711(b)(1) and

24.711(b)(2), on page 63235, col. 2 arecorrected to read as follows:* * * * *

(b) * * *(1) For an eligible licensee with gross

revenues exceeding $75 million(calculated in accordance with § 24.709(a)(2) and (b)) in each of the twopreceding years (calculated inaccordance with § 24.720(f)), interestshall be imposed based on the rate forten-year U.S. Treasury obligationsapplicable on the date the license isgranted, plus 3.5 percent; paymentsshall include both principal and interestamortized over the term of the license.

(2) For an eligible licensee with grossrevenues not exceeding $75 million(calculated in accordance with § 24.709(a)(2) and (b)) in each of the twopreceding years, interest shall beimposed based on the rate of ten-yearU.S. Treasury obligations applicable onthe date the license is granted, plus 2.5percent; payments shall include interestonly for the first year and payments ofinterest and principal amortized overthe remaining nine years of the licenseterm.* * * * * *

§ 24.712 [Corrected]6. Sections 24.712(d)(1) and

24.712(d)(2), on page 63235. col. 3, andpage 63236, col. 1, are corrected to readas follows:* * * * * *

(d) * * *(1) If during the term of the initial

license grant (see § 24.15), a licenseethat utilize a bidding credit under thissection seeks to assign or transfercontrol of its license to an entity notmeeting the eligibility standards forbidding credits or seeks to make anyother change in ownership that wouldresult in the licensee no longerqualifying for bidding credits under thissection, the licensee must seekCommission approval and reimburse thegovernment for the amount of thebidding credit as a condition of theapproval of such assignment, transfer orother ownership change.

(2) If during the term of the initiallicense grant (see § 24.15), a licenseethat utilizes a bidding credit under thissection seeks to assign or transfercontrol of its license to an entitymeeting the eligibility standards for

lower bidding credits or seeks to makeany other change in ownership thatwould result in the licensee qualifyingfor a lower bidding credit under thissection, the licensee must seekCommission approval and reimburse thegovernment for the difference betweenthe amount of the bidding creditobtained by the licensee and the biddingcredit for which the assignee, transfereeor licensee is eligible under this sectionas a condition of the approval of suchassignment, transfer or other ownershipchange.

§ 24.720 [Corrected]

7. Section 24.720 (f) and (h), on page63236, col. 2 and col. 3, are corrected toread as follows:* * * * *

(f) Gross Revenues. Gross revenuesshall mean all income received by anentity, whether earned or passive, beforeany deductions are made for costs ofdoing business (e.g. cost of goods sold),as evidenced by audited financialstatements for the relevant number ofcalendar years preceding January 1,1994, or, if audited, financial statementswere not prepared on a calendar-yearbasis, for the most recently completedfiscal years preceding the filing of theapplicant’s short-form application(Form 175). For short-form applicationsfiled after December 31, 1995, grossrevenues shall be evidenced by auditedfinancial statements for the precedingrelevant number of calendar or fiscalyears. If an entity was not in existencefor all or part of the relevant period,gross revenues shall be evidenced by theaudited financial statements of theentity’s predecessor-in-interest or, ifthere is no identifiable predecessor-in-interest, unaudited financial statementscertified by the applicant as accurate.* * * * *

(h) Institutional Investor. Aninstitutional investor is an insurancecompany, a bank holding stock in trustaccounts through its trust department,or an investment company as defined in15 U.S.C. 80a–3(a), including withinsuch definition any entity that wouldotherwise meet the definition ofinvestment company under 15 U.S.C.80a–3(a) but is excluded by theexemptions set forth in 15 U.S.C. 80a–3 (b) and (c), without regard to whethersuch entity is an issuer of securities;provided that, if such investmentcompany is owned, in whole or in part,by other entities, such investmentcompany, such other entities and theaffiliates of such other entities, taken asa whole, must be primarily engaged inthe business of investing, reinvesting ortrading in securities or in distributing or


1 The agency notes that there was no ANPRMaddressing stop signal arms. The discussiondescribed by Blue Bird was contained in the NPRM(55 FR 3624, February 2, 1990).

providing investment managementservices for securities.* * * * *Federal Communications Commission.William F. Caton,Acting Secretary.[FR Doc. 95–1948 Filed 1–26–95; 8:45 am]BILLING CODE 6712–01–M

DEPARTMENT OF TRANSPORTATION

National Highway Traffic SafetyAdministration

49 CFR Part 571

[Docket No. 90–01; Notice 5]

RIN 2127–AF32

Federal Motor Vehicle SafetyStandards; School Bus PedestrianSafety Devices

AGENCY: National Highway TrafficSafety Administration (NHTSA), DOT.ACTION: Final rule.

SUMMARY: This notice adopts as final theamendments made by an interim finalrule to the flash rate requirement forstop signal arm lamps in Standard No.131, School Bus Pedestrian SafetyDevices. The interim final rule, whichresponded to a petition for rulemakingsubmitted by Blue Bird Bus Company,removed design restrictive language thathad the effect of prohibiting strobelamps on stop signal arms.DATES: Effective Date: January 27, 1995.

Petitions for reconsideration: Anypetition for reconsideration of this rulemust be received by the agency not laterthan February 27, 1995.ADDRESSES: Petitions for reconsiderationshould refer to Docket No. 90–01; Notice5 and be submitted to the following:Administrator, National HighwayTraffic Safety Administration, 400Seventh Street, SW., Washington, DC20590.FOR FURTHER INFORMATION CONTACT: Mr.Charles Hott, Office of Vehicle SafetyStandards, National Highway TrafficSafety Administration, 400 SeventhStreet, SW., Washington, DC 20590(202) 366–0247.


I. Background

Federal motor vehicle safety standard(FMVSS) No. 131, School BusPedestrian Safety Devices, requires eachnew school bus to be equipped with astop signal arm. A stop signal arm is anitem of school bus equipment designedto alert motorists that a school bus isstopping or has stopped. The stop signal

arm is patterned after a conventional‘‘STOP’’ sign and attached to theexterior of the driver’s side of a schoolbus. When the school bus stops, the stopsignal arm automatically extendsoutward from the bus. The standardspecifies requirements for the stopsignal arm’s appearance, size,conspicuity, operation and location. Toenhance the conspicuity of a stop signalarm, Standard No. 131 specifies that thedevice must be either reflectorized or beilluminated with flashing lamps.

On February 22, 1994, Blue Bird BodyCompany (Blue Bird) petitioned theagency to amend the flash raterequirements in S6.2.2 of Standard No.131 to allow the use of strobe lamps onstop signal arms. At the time, S6.2.2stated:S6.2.2 Flash Rate. The lamps on each sideof the stop signal arm, when operated at themanufacturer’s design load, shall flash at arate of 60 to 120 flashes per minute with acurrent ‘‘on’’ time of 30 to 75 percent. Thetotal of the percent current ‘‘on’’ time for thetwo terminals shall be between 90 and 110.

Blue Bird argued that the requirementhad the effect of prohibiting the use ofstrobe lamps. Citing previous agencynotices, Blue Bird stated its belief thatNHTSA had not intended, in issuing itsstop signal arm requirements, toprohibit the use of strobe lamps on stopsignal arms. For instance, it stated that,in the advance notice of proposedrulemaking (ANPRM), the agency hadsolicited comments about whether theagency should require strobe lamps.1

According to Blue Bird, its petitionwas precipitated by a letter that itreceived from NHTSA’s Office ofVehicle Safety Compliance addressingan apparent non-compliance of schoolbuses manufactured with stop signalarms equipped with strobe lamps. BlueBird stated that the apparent non-compliance results from the fact thatS6.2.2 sets forth restrictive designrequirements based on the operatingcharacteristics of incandescent lampsinstead of more performance-orientedrequirements based on visualeffectiveness. The petitioner alleged thatthe requirement prevents the use ofstrobe lamps. Based on theseallegations, Blue Bird stated that theapparent noncompliance results from adeficiency in the Standard and not adeficiency in its school buses. Blue Birdrequested that the agency amend S6.2.2to allow the use of strobe lamps, statingthat this would be in the interests of

safety and consistent with theStandard’s intent.

Blue Bird also stated that four states(Alaska, New Mexico, Washington, andWest Virginia) as well as some localschool districts require stop signal armsto be equipped with strobe lamps. Thisconsideration prompted Blue Bird torequest that this rulemaking take effectimmediately, claiming that theproduction and delivery of school buseswith strobe lamp equipped stop signalarms needed to continue withoutdisruption.

On May 24, 1994, NHTSA publishedan interim final rule that amended theflash rate requirements to remove designrestrictive language that acted toprohibit strobe lamps (59 FR 26759).The agency explained that, inestablishing the flash rate requirements,the agency intended to assure theconspicuity of stop signal arms and didnot intend to prohibit manufacturersfrom installing strobe lamps on stopsignal arms to provide such conspicuity.The requirements in effect prior to theinterim final rule were based uponfilament type lamps, which need anextended current-on-time of 90 to 110percent of the total flash cycle for thetwo terminals. This time period isneeded to allow this type of lamp tocome to full brilliance. In contrast,strobe lamps come to full brilliancealmost immediately and could not meetthe current-on-time requirements forfilament type lamps. The interim finalrule resolved this problem by modifyingthe flash rate requirements to reflectchanges made to the Society ofAutomotive Engineers (SAE’s)Recommended Practice J1133, July1989, School Bus Stop Arms, to allowthe use of strobe lights on stop arms.

NHTSA received comments about theinterim final rule from the NationalSchool Transportation Association(NSTA) and Specialty ManufacturingCompany (Specialty) whichmanufactures stop signal arms. NSTAstated that the interim final rule shouldbe made permanent.

Specialty also stated that the interimfinal rule should be made permanent,provided that the agency adopts anindustry practice which treats a doubleflash strobe pattern to be a single flashcycle. It explained that both single anddouble flash strobe lamps are available,but that the secondary flash of a doublestrobe pattern will occur approximately0.17 seconds after the initial flash.According to the commenter, theindustry considers this double flashpattern to be a single flash since theyoccur in rapid succession.

NHTSA agrees with Specialty thatmultiple flash patterns that occur


rapidly should be considered to be asingle flash. In a March 29, 1994interpretation letter to the ConnecticutDepartment of Motor Vehicles, NHTSAstated that the light emanating from astrobe lamp that flashes repeatedly inrapid succession will be considered asingle flash of varying intensity and notas multiple flashes, when determiningthe flash rate and flash cycle foralternatively flashing lights required byStandard No. 108, Lamps, ReflectiveDevices, and Associated Equipment, forschool buses. The agency believes thatit is appropriate to apply the sameprinciple to school bus stop armsequipped with multiple flash strobelamps on stop arms. Accordingly,NHTSA considers strobe lamps onschool bus stop arms that have multipleflashes of a single lamp and then remainoff while the other lamp flashes to be asingle flash cycle.

Based on the reasons set forth in theinterim final rule and those set forthabove, NHTSA has decided to adopt theamendments in the interim final rule ona permanent basis. NHTSA determinedthat there is good cause to establish animmediate effective date for the finalrule to avoid disrupting compliancewith the Standard as explained in theinterim final rule.

Regulatory Analyses and Notices

A. Executive Order 12866 (FederalRegulation) and DOT RegulatoryPolicies and Procedures

This notice was not reviewed underE.O. 12866. NHTSA has analyzed thisrulemaking and determined that it is notsignificant within the meaning of theDepartment of Transportation regulatorypolicies and procedures. The agency hasdetermined that the economic effects ofthe amendment are so minimal that afull regulatory evaluation is notrequired. Since the amendment imposesno new requirement but simply allowsfor an alternative design, any costimpacts will be in the nature of slight,nonquantifiable cost savings.

B. Regulatory Flexibility Act

In accordance with the RegulatoryFlexibility Act, NHTSA has evaluatedthe effects of this rulemaking on smallentities. Based on this evaluation, Ihereby certify that the amendments willnot have significant economic impact ona substantial number of small entities.Few of the school bus manufacturersqualify as small entities. In addition,manufacturers of motor vehicles, smallbusinesses, small organizations, andsmall governmental units that purchasemotor vehicles will not be significantlyaffected by the slight cost savings

resulting from the amendments.Accordingly, a regulatory flexibilityanalysis has not been performed.

C. Federalism Assessment

This action has been analyzed inaccordance with the principles andcriteria contained in Executive Order12612. NHTSA has determined that therulemaking does not have sufficientfederalism implications to warrant thepreparation of a Federalism Assessment.Nevertheless, NHTSA notes that thelaws of various local jurisdictions andfour States (Alaska, New Mexico,Washington, and West Virginia) requirestop signal arms to be equipped withstrobe lamps and thus would have beenpreempted without this amendment.

D. Environmental Impacts

In accordance with the NationalEnvironmental Policy Act of 1969,NHTSA has considered theenvironmental impacts of this rule. Theagency has determined that this rulewill not have a significant effect on thequality of the human environment.

E. Civil Justice Reform

This final rule does not have anyretroactive effect. Under 49 U.S.C.30103, whenever a Federal motorvehicle safety standard is in effect, aState may not adopt or maintain a safetystandard applicable to the same aspectof performance which is not identical tothe Federal standard, except to theextent that the State requirementimposes a higher level of performanceand applies only to vehicles procuredfor the State’s use. 49 U.S.C. 30161 setsforth a procedure for judicial review offinal rules establishing, amending orrevoking Federal motor vehicle safetystandards. That section does not requiresubmission of a petition forreconsideration or other administrativeproceedings before parties may file suitin court.


Imports, Incorporation by reference,Motor vehicle safety, Motor vehicles,Rubber and rubber products, Tires.

Accordingly, the interim ruleamending 49 CFR part 571 which waspublished at 59 FR 26759 on May 24,1994, is adopted as a final rule withoutchange.

Authority: 49 U.S.C. 322, 30111, 30115,30117, and 30166, delegation of authority at49 CFR 1.50.

Issued on: January 23, 1995.Ricardo Martinez,Administrator.[FR Doc. 95–2117 Filed 1–26–95; 8:45 am]BILLING CODE 4910–59–M

DEPARTMENT OF COMMERCE

National Oceanic and AtmosphericAdministration

50 CFR Part 672

[Docket No. 941249–4349; I.D. 012095A]

Groundfish of the Gulf of Alaska;Inseason Action

AGENCY: National Marine FisheriesService (NMFS), National Oceanic andAtmospheric Administration (NOAA),Commerce.ACTION: Closure.

SUMMARY: NMFS is prohibiting directedfishing for pollock in Statistical Area 62in the Gulf of Alaska (GOA). This actionis necessary to prevent exceeding theinterim 1995 initial specification forpollock in this area.EFFECTIVE DATE: 12 noon, Alaska localtime (A.l.t.), January 24, 1995, until 12noon A.l.t., April 1, 1995, unlesssuperseded by the final 1995specifications in the Federal Register.FOR FURTHER INFORMATION CONTACT:Michael L. Sloan, 907–586-7228.SUPPLEMENTARY INFORMATION: Thegroundfish fishery in the GOA exclusiveeconomic zone is managed by NMFSaccording to the Fishery ManagementPlan for Groundfish of the Gulf ofAlaska (FMP) prepared by the NorthPacific Fishery Management Councilunder authority of the MagnusonFishery Conservation and ManagementAct. Fishing by U.S. vessels is governedby regulations implementing the FMP at50 CFR parts 620 and 672.

The interim specification of pollocktotal allowable catch in Statistical Area62 was established by interimspecifications (59 FR 65975, December22, 1994) as 3,827 metric tons (mt),determined in accordance with§ 672.20(c)(1)(ii)(A).

The Director, Alaska Region, NMFS(Regional Director), has determined, inaccordance with § 672.20(c)(2)(ii), thatthe 1995 interim specification of pollockin Statistical Area 62 soon will bereached. The Regional Directorestablished a directed fishing allowanceof 2,800 mt, and has set aside theremaining 1,027 mt as bycatch tosupport other anticipated groundfishfisheries. Because of the low directedfishing allowance and high interest inthe fishery, there will be insufficienttime to collect and analyze catch dataand take appropriate action to ensurethe directed fishing allowance is notexceeded. Therefore, based on the bestavailable data, the Regional Director hasdetermined that the pollock directed


fishing allowance in Statistical Area 62will be reached by 12 noon A.l.t.,January 24, 1995. Consequently, NMFSis prohibiting directed fishing forpollock in Statistical Area 62.

Directed fishing standards forapplicable gear types may be found inthe regulations at § 672.20(g).

ClassificationThis action is taken under 50 CFR

672.20 and is exempt from review underE.O. 12866.


Dated: January 23, 1995.David S. Crestin,Acting Director, Office of FisheriesConservation and Management, NationalMarine Fisheries Service.[FR Doc. 95–2098 Filed 1–24–95; 4:31 pm]BILLING CODE 3510–22–F

50 CFR Part 672

[Docket No. 941249–4349; I.D. 012095B]

Groundfish of the Gulf of Alaska;Inseason Action

AGENCY: National Marine FisheriesService (NMFS), National Oceanic andAtmospheric Administration (NOAA),Commerce.ACTION: Closure.

SUMMARY: NMFS is prohibiting directedfishing for pollock in Statistical Area 63

in the Gulf of Alaska (GOA). This actionis necessary to prevent exceeding theinterim 1995 initial specification forpollock in this area.EFFECTIVE DATE: 12 noon, Alaska localtime (A.l.t.), January 24, 1995, until 12noon A.l.t, April 1, 1995 unlesssuperseded by the final 1995specifications in the Federal Register.FOR FURTHER INFORMATION CONTACT:Michael L. Sloan, 907–586-7228.SUPPLEMENTARY INFORMATION: Thegroundfish fishery in the GOA exclusiveeconomic zone is managed by NMFSaccording to the Fishery ManagementPlan for Groundfish of the Gulf ofAlaska (FMP) prepared by the NorthPacific Fishery Management Councilunder authority of the MagnusonFishery Conservation and ManagementAct. Fishing by U.S. vessels is governedby regulations implementing the FMP at50 CFR parts 620 and 672.

The interim specification of pollocktotal allowable catch in Statistical Area63 was established by interimspecifications (59 FR 65975, December22, 1994) as 4,078 metric tons (mt),determined in accordance with§ 672.20(c)(1)(ii)(A).

The Director, Alaska Region, NMFS(Regional Director), has determined, inaccordance with § 672.20(c)(2)(ii), thatthe 1995 interim specification of pollockin Statistical Area 63 soon will bereached. The Regional Director

established a directed fishing allowanceof 3,000 mt, and has set aside theremaining 1,078 mt as bycatch tosupport other anticipated groundfishfisheries. Because of the low directedfishing allowance and high interest inthe fishery, there will be insufficienttime to collect and analyze catch dataand take appropriate action to ensurethe directed fishing allowance is notexceeded. Therefore, based on the bestavailable data, the Regional Director hasdetermined that the pollock directedfishing allowance in Statistical Area 63will be reached by 12 noon A.l.t.,January 24, 1995. Consequently, NMFSis prohibiting directed fishing forpollock in Statistical Area 63.

Directed fishing standards forapplicable gear types may be found inthe regulations at § 672.20(g).

Classification

This action is taken under 50 CFR672.20 and is exempt from review underE.O. 12866.


Dated: January 23, 1995.

David S. Crestin,Acting Director, Office of FisheriesConservation and Management, NationalMarine Fisheries Service.[FR Doc. 95–2097 Filed 1–24–95; 4:31 pm]

BILLING CODE 3510–22–F

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.

Proposed Rules Federal Register

5339

Vol. 60, No. 18


DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation7 CFR Part 457RIN 0563–AA96

Common Crop Insurance Regulations;Nursery Crop Insurance ProvisionsAGENCY: Federal Crop InsuranceCorporation.ACTION: Proposed rule.

SUMMARY: The Federal Crop InsuranceCorporation (FCIC) hereby proposesspecific crop provisions for theinsurance of nursery to be contained inan endorsement to the Common CropInsurance Policy which containsstandard terms and conditions commonto most crops. The intended effect ofthis action is to add a nursery frost,freeze, and cold damage exclusionoption to better meet the needs of theinsured.DATES: Written comments, data, andopinions on this proposed rule must besubmitted no later than February 27,1995 to be sure of consideration.ADDRESSES: Written comments, data,and opinion on this proposed ruleshould be sent to Diana Moslak,Regulatory and Procedural DevelopmentStaff, Federal Crop InsuranceCorporation, USDA, Washington, D.C.20250. Hand or messenger deliveryshould be made to 2101 L Street, N.W.,suite 500, Washington, D.C. Writtencomments will be available for publicinspection and copying in the Office ofthe Manager, 2101 L Street, N.W., 5thFloor, Washington, D.C., during regularbusiness hours, Monday through Friday.FOR FURTHER INFORMATION CONTACT:Diana Moslak, Federal Crop InsuranceCorporation, U.S. Department ofAgriculture, Washington, D.C. 20250.Telephone (202) 254–8314.SUPPLEMENTARY INFORMATION: Thisaction has been reviewed under UnitedStates Department of Agriculture(‘‘USDA’’) procedures established byExecutive Order 12866 andDepartmental Regulation 1512–1. Thisaction constitutes a review as to the

need, currency, clarity, andeffectiveness of these regulations underthose procedures. The sunset reviewdate established for these regulations isJanuary 1, 2000.

This rule has been determined to be‘‘not significant’’ for the purposes ofExecutive Order 12866, and therefore,has not been reviewed by the Office ofManagement and Budget (‘‘OMB’’).

The information collection or record-keeping requirements contained in theseregulations (7 CFR part 457) have beensubmitted to the OMB in accordancewith the provisions of 44 U.S.C. § 35and will be assigned an OMB controlnumber.

It has been determined under section6(a) of Executive Order 12612,Federalism, that this proposed rule doesnot have sufficient federalismimplications to warrant the preparationof a Federalism Assessment. Thepolicies and procedures contained inthis rule will not have a substantialdirect effect on states or their politicalsubdivisions, or on the distribution ofpower and responsibilities among thevarious levels of government.

Under the Regulatory Flexibility Act(5 U.S.C. § 605), this regulation will nothave a significant impact on asubstantial number of small entities.This action reduces the paperworkburden on the insured farmer and thereinsured company. Therefore, thisaction is determined to be exempt fromthe provisions of the RegulatoryFlexibility Act and no RegulatoryFlexibility Analysis 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 require intergovernmentalconsultation with state and localofficials. See the Notice related to 7 CFRpart 3015, subpart V, published at 48 FR29115, June 24, 1983.

The Office of the General Counsel hasdetermined that these regulations meetthe applicable standards provided insubsections (2)(a) and 2(b)(2) ofExecutive Order 12778. The provisionsof this rule will preempt state and locallaws to the extent such state and locallaws are inconsistent herewith. Theadministrative appeal provisionslocated at 7 CFR part 400, subpart J orpromulgated by the National AppealsDivision must be exhausted beforejudicial action may be brought.

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.

BackgroundFCIC proposes to add to the Common

Crop Insurance Regulations (7 CFR Part457), two new sections to be known as7 CFR 457.114, the Nursery CropInsurance Provisions and 7 CFR457.115, the Nursery Frost, Freeze, andCold Damage Exclusion Option. Theprovisions and option will be effectivefor the 1996 and succeeding crop years.

The proposed Nursery Crop InsuranceProvisions will replace the provisionsfound at 7 CFR part 406. By separaterule, FCIC will amend these regulationsto restrict the crop years of applicationto those prior to the crop year for whichthis rule will be effective and laterremove the nursery crop insuranceregulations contained in 7 CFR part 406.

This rule makes minor editorial andformat changes to improve itscompatibility with the Common CropInsurance Policy. In addition, FCIC isproposing other changes in theprovisions for insuring nursery crops:

1. Subsection 1.(a)—Revises thedefinition of ‘‘amount of insurance’’ toallow a maximum amount of insurancebased on the highest reported monthlymarket value of inventory plus anyadditional inventory added during theyear, or which is restocked, if approvedby the insurer. Presently, the maximumamount of insurance is based on 90percent of the average monthly marketvalue of inventory reported at thebeginning of the crop year. The 10percent reduced valuation in the currentregulations is eliminated to recognizethe abnormal expenses incurred indisposing of damaged inventory.

2. Subsection 1.(b)—Revises thedefinition of ‘‘annual loss deductible’’by replacing the term ‘‘field marketvalue’’ with the term ‘‘highest reportedmonthly market value.’’

3. Subsection 1.(e)—Revises thedefinition, ‘‘field market value A’’ to nolonger contain the 10 percent reducedvaluation contained in the currentregulations due to the change stated initem 1. above. Language specifies thatthe insurer reserves the right to reviewthe insured’s wholesale price list takinginto consideration maximum discounts

5340 Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Proposed Rules

granted to any buyer as contained in thedefinition of ‘‘wholesale market value.’’

4. Subsection 1.(f)—Revises thedefinition, ‘‘field market value B’’ to nolonger contain the 10 percent reducedvaluation contained in the currentregulations due to the change stated initem 1. above. Maximum pricingdiscounts will also be considered in thisdetermination as specified in thedefinition of ‘‘wholesale market value.’’

5. Subsection 1.(h)—Add a definitionfor ‘‘monthly loss deductible.’’

6. Subsection 1.(i)—Add a definitionfor ‘‘monthly market value.’’

7. Subsection 1.(n)—Add a definitionfor ‘‘standard nursery containers.’’

8. Section 2—Clarify that locationsoutside a five mile radius of the namedlocations, but within the same county,may be designated as a separate basicunit or be included in the closest unitlisted on the insured’s nursery plantinventory summary.

9. Subsection 6.(c )—Clarify thatwhenever inventory is expected tochange within a specific month, thehighest value for the month will berecorded on the nursery plant inventorysummary.

10. Subsection 6.(d)—Require theinsured to give notice in writing at least14 days before making a change ininventory value, if a request for arevised nursery plant inventorysummary is planned. This provisionallows the insurer to inspect theinventory if necessary.

11. Paragraphs 6.(d)(1) and 6.(d)(2)—Specify that insurance will not attach onany increase in inventory until theinsurer completes an inspection andaccepts such increase.

12. Subsection 6.(e)—Specify that anyplants added to the inventory that arenot reported for insurance will not beinsured, but the value of these plants,after a loss, will be consideredproduction to count for purposes of lossdetermination and claim settlement.

13. Subsection 7.(b)—Allow theinsured to pay the annual premium inthree installments. The first payment(40 percent of the annual premium) isdue and payable on the later ofSeptember 30 preceding the crop year orthe date the insurer accepts theinventory for insurance; the secondpayment (30 percent of the annualpremium) is due and payable on January1 of the crop year; and the thirdpayment (30 percent of the annualpremium) is due and payable on April1 of the crop year. Current provisionsstate that the annual premium is earnedand payable on or before September 30preceding each crop year, but allow asix month delay in the payment of

premiums, until March 31 of the cropyear.

14. Subsection 7.(c)—Specify thatadditional premium resulting from anincrease in a nursery plant inventorysummary is due and payable when therevised summary is approved.

15. Subsection 7.(d)—Clarify thatpremium will not be reduced due to adecrease in plant inventory, unless suchdecrease results from deletinguninsurable inventory which wasincorrectly reported.

16. Paragraph 8.(a)(1)—Require thatthe nursery plants be grown under anirrigated practice.

17. Paragraph 8.(a)(3)—Clarify that theinsured nursery plant inventory will notinclude plants that produce edibleberries, fruits, or nuts.

18. Paragraph 8.(a)(4)—Clarify thatnursery plants grown in standardnursery containers less than threeinches across at the smallest dimensionare not insured unless the insurer entersinto a written agreement to insure suchplants.

19. Paragraph 8.(a)(6)—Allow plantsnot listed in the Nursery Eligible PlantListing to be insurable if the insuredsubmits a written request and theinsurer agrees in writing to insure suchplants.

20. Paragraph 8.(a)(7)—Clarify thatstock plants will not be insured.

21. Section 9—Specify that insuranceattaches on the later of October 1 or thedate the insurer accepts the inventoryfor insurance, and in either case uponpayment of 40 percent of the annualpremium. This change allows theinsurer to complete any necessaryinspection before insurance attaches.This paragraph also states that when thenursery plant inventory summary isrevised to add additional plantinventory, coverage for the additionalinventory will not attach until theadditional premium for that inventory ispaid in full.

22. Subsection 9.(a)—Clarify thatinsurance coverage ends wheninventory is sold or removed unless thatinventory is replaced and additionalpremium is paid. Previous provisionsdid not permit insurance to attach torestocked inventory.

23. Paragraph 10.(a)(9)—Add as aninsurable cause of loss, failure orbreakdown of frost/freeze protectionequipment or facilities provided: 1)such failure or breakdown is caused bya named insurable cause of loss, 2) theinsured nursery plants are damaged byfreezing temperatures within 72 hoursof such failure or breakdown, and 3) theequipment or facilities could not berepaired or replaced between the time of

failure or breakdown and the time thefreezing temperatures occur.

24. Paragraph 10.(b)(1)—Clarify thatbrownout is not an insured cause ofloss.

25. Paragraph 10.(b)(2)—Clarify thatfailure of the power supply is not aninsured cause of loss, unless suchfailure is a direct result of an insuredcause of loss.

26. Paragraph 10.(b)(5)—Clarify thatcollapse or failure of buildings orstructures are not insured causes of lossunless due to an insured cause of loss.

27. Subsection 12(a)—Allow use ofthe highest reported monthly marketvalue for the unit and the monthly lossdeductible (not to exceed the remainingannual loss deductible) to calculate anindemnity. References to the 10 percentreduced valuation have been deleted.These changes were necessary due tothe change in the definition of ‘‘amountof insurance’’ as stated in item 1. above.

28. Add a nursery frost, freeze, andcold damage exclusion option. Thisoption excludes losses due to frost,freeze, and cold weather for plants thathave specific over-winteringrequirements when those over-winteringrequirements will not be met.


Crop insurance, nursery crop.

Proposed Rule

Pursuant to the authority contained inthe Federal Crop Insurance Act, asamended (7 U.S.C. 1501 et seq.), theFederal Crop Insurance Corporationhereby proposes to amend the CommonCrop Insurance Regulations (7 CFR part457), effective for the 1996 andsucceeding crop years, to read asfollows:

PART 457—COMMON CROPINSURANCE REGULATIONS;REGULATIONS FOR THE 1996 ANDSUBSEQUENT CONTRACT YEARS

1. The authority citation for 7 CFRpart 457 is revised to read as follows:

Authority: 7 U.S.C. 1506(1).

2. The heading for part 457 is revisedas set forth above.

3. 7 CFR part 457 is amended byadding §§ 457.114 and 457.115 to readas follows:

§ 457.114 Nursery Crop InsuranceProvisions.

The Nursery Crop InsuranceProvisions for the 1996 and succeedingcrop years are as follows:

5341Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Proposed Rules


Federal Crop Insurance Corporation

Nursery Crop ProvisionsIf a conflict exists among the Basic

Provisions (§ 457.8), these crop provisions,and the Special Provisions, the SpecialProvisions will control these crop provisionsand the Basic Provisions; and these cropprovisions will control the Basic Provisions.

1. Definitions

(a) Amount of insurance—The result ofmultiplying the highest monthly marketvalue reported on the nursery plant inventorysummary (which will include inventoryreported by you and accepted by us on arevised nursery plant inventory summary orrestocked), multiplied by the percentage forthe coverage level you elect.

(b) Annual loss deductible—The valuecalculated by subtracting the amount ofinsurance from the highest monthly marketvalue reported on the nursery plant inventorysummary. The annual loss deductible will berevised if an inventory addition is approved.

(c) Brownout—A cutback or reduction inelectric power, as a result of a shortage.

(d) Crop year—The 12 month period whichbegins October 1 and extends throughSeptember 30 of the next calendar year,designated by the year in which it ends. (The1996 crop year begins October 1, 1995, andends September 30, 1996).

(e) Field market value A—The wholesalemarket value for the unit immediately priorto the occurrence of the loss.

(f) Field market value B—The wholesalemarket value remaining for the unitimmediately following the occurrence of theloss.

(g) Irrigated practice—A method ofproducing a crop by which water isartificially applied during the growing seasonby appropriate systems and at the propertimes, with the intention of providing thequantity of water needed to maintain theamount of insurance on the nursery plantinventory.

(h) Monthly loss deductible—The result ofmultiplying the smaller of field market valueA or the highest monthly market valuereported on the nursery plant inventorysummary by 100 percent (100%) less thepercentage for the coverage level you elect,not to exceed the annual loss deductible.When inventory is added or restocked by arevised nursery plant inventory summary,the monthly loss deductible will becalculated based on the revised monthlymarket value, not to exceed the annual lossdeductible.

(i) Monthly market value—The sum of thewholesale market value of all insurableplants in the unit for a month based on yourwholesale price list less the maximumdiscount granted to any buyer.

(j) Nursery—A business enterprise thatproduces ornamental plant types in standardnursery containers for the wholesale market.

(k) Nursery eligible plant listing—A listingcontained in the Actuarial Table whichspecifies the plants eligible for insurance andany mandatory or recommended storagerequired for such plants in each hardinesszone defined by the United StatesDepartment of Agriculture.

(l) Nursery plant inventory summary—Areport that specifies numbers and prices ofplants included in the nursery inventory.

(m) Smallest dimension—For a roundcontainer, the diameter; for any othercontainer, the distance measured from oneside directly across to the opposite side at thenarrowest point.

(n) Standard nursery containers—Rigidcontainers not less than three (3) inchesacross the smallest dimension which arecommercially sold to nurseries. Grow bags,trays, cellpacks, and burlap are notconsidered standard nursery containers.

(o) Stock plants—Plants being used forreproduction, for growing cuttings, for airlayers or for propagating.

(p) Wholesale market value—The dollarvaluation of the numbers of insurable plantsactually contained within the unit at anytime. The values used will be based on yourwholesale price list less the maximumdiscount granted to any buyer.

(q) Written agreement—Designated termsof this policy may be altered by writtenagreement. Each agreement must be appliedfor by the insured in writing no later than thesales closing date and is valid for one yearonly. If not specifically renewed thefollowing year, continuous insurance will bein accordance with the printed policy. Allvariable terms including, but not limited to,plant type and premium rate must becontained in the written agreement.Notwithstanding the sales closing daterestriction contained herein, in specificinstances, a written agreement may beapplied for after the sales closing date andapproved if, after a physical inspection of thenursery plant inventory, there is adetermination that the inventory has theexpectancy of meeting the amount ofinsurance. All applications for writtenagreements as submitted by the insured mustcontain all variable terms of the contractbetween the company and the insured thatwill be in effect if the written agreement isdisapproved.

2. Unit Division

In lieu of the definition of unit containedin subsection 1.(tt) of the Basic Provisions(§ 457.8), a unit consists of all growinglocations in the county within a five mileradius of the named insured locationsdesignated on your nursery plant inventorysummary. Any growing location more thanfive miles from any other growing location,but within the county, may be designated asa separate basic unit or be included in theclosest unit listed on your nursery plantinventory summary.

3. Insurance Guarantees, Coverage Levels,and Prices for Determining Indemnities

Subsection 3.(c) of the Basic Provisions(§ 457.8) is not applicable to the NurseryCrop Provisions.

4. Contract Changes

The contract change date is June 30preceding the crop year (see the provisionsof section 4 (Contract Changes) of the BasicProvisions (§ 457.8)).

5. Cancellation and Termination Dates

In accordance with subsection 2.(f) of theBasic Provisions (§ 457.8), the cancellation

and termination dates are September 30preceding the crop year.

6. Nursery Plant Inventory Summary

(a) For the purposes of the provisions ofsection 6 (Report of Acreage) of the BasicProvisions (§ 457.8), the term ‘‘acreage’’means ‘‘nursery plant inventory.’’

(b) Your annual nursery plant inventorysummary will be used to determine yourpremium and the amount of insurance foreach unit. If you do not submit the summaryby the reporting date, we may elect todetermine the nursery plant inventory foreach unit or we may deny liability on anyunit. Errors in reporting units may becorrected by us at the time of lossadjustment.

(c) You must submit a nursery plantinventory summary to us on or beforeSeptember 30 preceding the crop year. Thissummary must include, by unit and bymonth for each type of plant in the inventory,the:

(1) Container sizes;(2) Number of plants;(3) Wholesale price for each month of the

crop year; and(4) Your share.If your inventory will change within a

specific month, report the largest inventorythat you will have for that month.

(d) With our consent, you may revise yournursery plant inventory summary to corrector change the value of the insurableinventory caused by a quantity change if theamount of the revision is at least 10 percentof the highest monthly market value reportedon the nursery plant inventory summary or$25,000, whichever is smaller. You may notrevise your nursery plant inventory summaryafter the sales closing date to add plants notlisted on the Nursery Eligible Plant Listing.If you wish to revise the nursery plantinventory summary, you must notify us inwriting at least 14 days before a change ininventory value. We must inspect and acceptthe nursery before insurance attaches on anyproposed increase in inventory if:

(1) The storage facilities have changed inany way since our previous inspection; or

(2) The revision includes plants that havespecific over-wintering storage requirementsand that were not previously reported onyour nursery plant inventory summary.

(e) Insurable plants that are not reported onyour nursery plant inventory summary willnot be insured, but the value of such plantsafter a loss will be included as production tocount. Such unreported inventory mayreduce the amount of any indemnity payableto you.

(f) You must designate separately any plantinventory that is not insurable.

(g) Subsection 6.(f) of the Basic Provisions(§ 457.8) is not applicable to the NurseryCrop Provisions.

7. Annual Premium

We will determine your premium asfollows:

(a) The annual premium for each unit willbe calculated by:

(1) Multiplying the number of each type ofplant and size container designated on yournursery plant inventory summary for eachmonth by prices for that type and container


size shown on your wholesale price list, lessthe maximum discount granted to any buyer;

(2) Adding the results of step 1, for eachmonth;

(3) Multiplying the highest monthly marketvalue for the crop year by the percentage forthe coverage level you have elected;

(4) Multiplying the product obtained in (3)above by the appropriate premium rate foreach appropriate plant classification listed onthe actuarial table; and

(5) Multiplying the product obtained in (4)above by your share.

(b) The annual premium will be earned infull when insurance attaches. It is due andpayable as follows:

(1) Forty percent (40%) on the later ofSeptember 30 preceding each crop year or thedate we accept the inventory for insurance;

(2) Thirty percent (30%) on January 1 ofthe crop year; and

(3) Thirty percent (30%) on April 1 of thecrop year.

(c) Additional premium earned from anincrease in the nursery plant inventorysummary is due and payable when therevised nursery plant inventory summary isapproved by us.

(d) Premium will not be reduced due to adecrease in the nursery plant inventorysummary, unless such decrease results fromthe deletion of uninsurable inventory fromthe summary that was erroneously reportedas insurable.

8. Insured Plants

(a) In lieu of the provisions of section 8(Insured Crop) of the Basic Provisions(§ 457.8), the insured nursery plant inventorywill be all nursery plants in the countyreported by you or determined by us forwhich an application is accepted, for whicha premium rate is provided by the actuarialtable, and that:

(1) Are grown under an irrigated practicefor which you have adequate facilities andwater at the time coverage begins in order tocarry out a good irrigation practice;

(2) Are classified as woody, herbaceous, orfoliage landscape plants;

(3) Do not include plants that produceedible berries, fruits or nuts;

(4) Are grown in standard nurserycontainers (not planted in the ground), atleast three (3) inches across the smallestdimension unless a written agreement isextended allowing a smaller container;

(5) Are initially inspected by us anddetermined to be acceptable;

(6) Are listed on the Nursery Eligible PlantListing unless a written agreement providesotherwise;

(7) Are not stock plants;(8) Are grown in accordance with the

production practices for which premiumrates have been established; and

(9) Meet the ‘‘mandatory’’ or‘‘recommended’’ storage requirements unlessyou have signed the Frost, Freeze, and ColdDamage Exclusion Option for those nurseryplants.

(b) The provisions of section 9 of the BasicProvisions (§ 457.8) are not applicable to theNursery Crop Provisions.

9. Insurance Period

In lieu of the provisions of section 11(Insurance Period) of the Basic Provisions

(§ 457.8), coverage begins on each unit or partof a unit the later of October 1 or the datewe accept the inventory for insurance,provided at least 40 percent (40%) of theannual premium is paid by the date specifiedin paragraph 7.(b)(1). Coverage will notattach for plant inventory added due to arevised nursery plant inventory summaryuntil any additional premium is paid in full.Insurance ends for each unit at the earliestof:

(a) The date all plant inventory within theunit is sold or otherwise removed unless thatinventory is replaced and additional earnedpremium is paid. (If a portion of the plantsare sold or otherwise removed frominventory and are not replaced, insuranceends only on that part of the unit.);

(b) The date of final adjustment of the losson the unit; or

(c) September 30 of the crop year.

10. Causes of Loss

(a) In accordance with the provisions ofsection 12 (Causes of Loss) of the BasicProvisions (§ 457.8), insurance is providedfor unavoidable damage caused only by thefollowing causes of loss which occur withinthe insurance period:

(1) Adverse weather conditions;(2) Fire;(3) Insects, but not damage due to

insufficient or improper application of pestcontrol measures;

(4) Plant disease, but not damage due toinsufficient or improper application ofdisease control measures;

(5) Wildlife;(6) Earthquake;(7) Volcanic eruption;(8) Failure of the irrigation water supply,

due to an unavoidable cause of loss occurringwithin the insurance period; or

(9) Failure or breakdown of frost/freezeprotection equipment or facilities due todirect damage to such equipment or facilitiesfrom an insurable cause of loss, provided theinsured nursery plants are damaged byfreezing temperatures within 72 hours afterthe failure of such equipment or facilities andrepair or replacement was not possiblebetween the time of failure or breakdown andthe time the freezing temperatures occurred.

(b) In addition to the causes of loss notinsured against under section 12 (Causes ofLoss) of the Basic Provisions (§ 457.8), we donot insure against any loss caused by:

(1) Brownout;(2) Failure of the power supply unless such

failure is due to an insurable cause of loss;(3) The inability to market the nursery

plants as a direct result of quarantine,boycott, or refusal of a buyer to acceptproduction;

(4) Fire, where weeds and other forms ofundergrowth in the vicinity of the buildingand on your property have not beencontrolled; or

(5) Collapse or failure of buildings orstructures unless due to an insured cause ofloss.

11. Duties in the Event of Damage or Loss

(a) In addition to your duties containedunder section 14 (Duties in the Event ofDamage or Loss) of the Basic Provisions(§ 457.8), you must:

(1) Obtain our written consent prior to:(i) Destroying, selling or otherwise

disposing of any plant inventory that isdamaged; or

(ii) Changing or discontinuing your normalgrowing practices with respect to care andmaintenance of the insured plant inventory.

(2) Upon our request, provide completecopies of your nursery plant inventorywholesale price list for the 12 month periodimmediately preceding the loss and yourmarketing records including plant shippinginvoices for the same period.

(b) In addition to subsection 14.(c) of theBasic Provisions (§ 457.8), you must submita claim for indemnity to us on our form, notlater than 60 days after the earliest of:

(1) Your loss; or(2) The end of the insurance period.

12. Settlement of Claim

(a) The indemnity will be the amountcalculated by us for each unit as follows:

(1) Subtracting field market value B fromthe lesser of field market value A or thehighest monthly market value for the unitreported on the nursery plant inventorysummary to determine the total amount ofloss;

(2) Subtracting therefrom the monthly lossdeductible (not to exceed the remainingannual loss deductible); and

(3) Multiplying the result of (2) above byyour share.

(b) Individual insured losses occurring onthe same unit during the crop year may beaccumulated if each loss is reported andvalued by us to satisfy the annual lossdeductible. Paragraph 12.(a)(2) will not applyto any subsequent individual lossdeterminations when the total amount ofaccumulated monthly loss deductibles isequal to or greater than the annual lossdeductible. Total indemnities for a unit willnot exceed the amount of insurance for theunit.

(c) The value of any insured plantinventory may be determined on the basis ofour appraisals conducted after the end of theinsurance period.

§ 457.115 Nursery Frost, Freeze, and ColdDamage Exclusion Option.

This is not a continuous option.Application for this option must bemade on or before the sales closing datefor each crop year this Option is to bein effect (see exception in item 2 below).Insured’s Name lllllllllllllAddress llllllllllllllllContract Number llllllllllllIdentification Number llllllllllSSN/EIN llll Tax I.D. llllCrop Year llll Unit Number llll

Hardiness Zone llll

For the crop year designated above,the Nursery Crop Provisions (§ 457.114)are amended in accordance with thefollowing terms and conditions:

1. You must have the Common CropInsurance Policy Basic Provisions andNursery Crop Provisions in force.

2. This option must be submitted tous on or before the final date for


accepting applications for the crop yearin which you wish to insure yournursery plant inventory under thisoption. If the provisions of paragraph6.(d)(2) of the Nursery Crop Provisionsapply, we may accept this option afterthe sales closing date, or we may allowadditional plants to be added to thisoption after such date.

3. Executing this option does notreduce the premium rate for nurserycrop insurance.

4. All provisions of the BasicProvisions (§ 457.8) and Nursery CropProvisions (§ 457.114) not in conflictwith this option are applicable.

5. Upon execution of this option, thefollowing plant varieties will not havefrost, freeze, or cold damage coverage onthis unit because the mandatory (RiskGroup A) or recommended (Risk GroupB) over-wintering requirements will notbe met.

Scientificname

Commonname

Over-winter-ing require-ments to be

excluded

Insured’s SignatureDate lllllllllllllllllllllllllllllllllllllllInsurance Company Representative’s

Signature and Code NumberDate lllllllllllllllllllllllllllllllllllllll

Done in Washington, DC, on January 23,1995.Kenneth D. Ackerman,Manager, Federal Crop InsuranceCorporation.[FR Doc. 95–2057 Filed 1–26–95; 8:45 am]BILLING CODE 3410–08–P


Coast Guard

33 CFR Part 117

[CGD01–95–002]

RIN 2115–AE47

Drawbridge Operation Regulations;New Rochelle Harbor, NY

AGENCY: Coast Guard, DOT.ACTION: Notice of proposed rulemaking.

SUMMARY: The Coast Guard isconsidering a change to the regulationsgoverning the Glen Island Bridge overNew Rochelle Harbor at mile 0.8 in NewRochelle, New York. This change to theregulations will allow the bridge ownerto reduce the number of hours in a daythat the bridge is manned bydrawtenders and opened on signal. Thischange is proposed because there havebeen few requests for bridge openingsduring the time periods at issue, i.e.,from 1 May through 31 October, 12midnight to 8 a.m., and from 1November through 30 April, 8 p.m. to 8a.m.DATES: Comments must be received onor before March 28, 1995.ADDRESSES: Comments may be mailed toCommander (obr), First Coast GuardDistrict, Building 135A, GovernorsIsland, New York, 10004–5073, or maybe hand-delivered to the same addressbetween 7 a.m. and 4 p.m., Mondaythrough Friday, except federal holidays.The telephone number is (212) 668–7170. The comments will become partof this docket and will be available forinspection and copying by appointmentat the above address.FOR FURTHER INFORMATION CONTACT:Ms. Sylvia Bowens, Project Manager,Bridge Branch, (212) 668–7170.


Request for CommentsThe Coast Guard encourages

interested persons to participate in thisrulemaking by submitting written views,comments, data, or arguments. Personssubmitting comments should includetheir names and addresses, identify thisrulemaking (CGD01–95–002), thespecific section of the proposal to whicheach comment applies, and givenreasons for each comment. The CoastGuard requests that all comments andattachments be submitted in anunbound format no larger than 81⁄2′′ by11′′, suitable for copying and electronicfiling. If that is not practical, a secondcopy of any bound material is requested.Persons desiring acknowledgment thattheir comments have been receivedshould enclose a stamped, self-addressed post card or envelope.

The Coast Guard will consider allcomments received during the commentperiod, and may change this proposal inlight of comments received. The CoastGuard plans no public hearing. Personsmay request a public hearing by writingto Commander (obr), First Coast GuardDistrict at the address listed underADDRESSES. The request should includereasons why a hearing would bebeneficial. If the Coast Guarddetermines that the opportunity for oral

presentations will aid this rulemaking,the Coast Guard will hold a publichearing at a time and place announcedby a later notice in the Federal Register.

Drafting InformationThe drafters of this notice are Mr.

John W. McDonald, Bridge ManagementSpecialist, Bridge Branch, and LCDRSamuel R. Watkins, Project Counsel,District Legal Office.

Background and PurposeThe Glen Island Bridge spans New

Rochelle Harbor, New York. It was builtin 1929 and has a vertical clearance of13’ above mean high water (MHW) anda vertical clearance of 20’ above meanlow water (MLW). Glen Island Bridgelogs for 1990 tallied only fifty-two (52)openings during the periods relevant tothis proposed rule: forty-five (45) fromJuly to October, between 12 midnightand 8 a.m.; and seven (7) duringNovember and December, between 8p.m. and 8 a.m. Bridge openings for1991 totaled only fifty-one (51) duringthe relevant periods: forty-five (45) fromMay to July, between 12 midnight and8 a.m.; and six (6) from January to April,between 8 p.m. and 8 a.m. In 1992 therewere only twenty (20) openings duringthe relevant periods: fourteen (14) forthe month of October, between 12midnight and 8 a.m.; and six (6) duringNovember and December, between 8p.m. and 8 a.m. Bridge logs for 1993tallied only eighty-two (82) bridgeopenings during the relevant periods:seventy-seven (77) from May toSeptember, between 12 midnight and 8a.m.; and five (5) from January to April,between 8 p.m. and 8 a.m. The bridgeowner was not able to provide bridgelogs from September 21, 1991 throughSeptember 23, 1992 because they weredamaged by water during a storm inDecember, 1992.

The present operating regulationsrequire the Glen Island Bridge to openon signal at all times. The proposedregulations would allow the bridge toremain closed from 1 May through 31October, between 12 midnight and 8a.m., and from 1 November through 30April, between 8 p.m. and 8 a.m. Theseclosed periods will relieve the bridgeowner from the unnecessary burden ofhaving the bridge manned withdrawtenders at all times.

Discussion of Proposed AmendmentsThe bridge owner, Westchester

County, requested a change to thepresent general operating regulationswhich require the bridge to open onsignal at all times. It is proposed that 33CFR 117.802 be added to provide thatthe Glen Island Bridge need not open


from 1 May through 31 October,between 12 midnight and 8 a.m., andfrom 1 November through 30 April,between 8 p.m. to 8 a.m. At all othertimes the bridge will open on signal.This change to the regulations is beingproposed due to infrequent request foropenings during the above time periodsand will relieve the bridge owner of theburden of having personnel at the bridgeat all times.

Regulatory EvaluationThis proposal is not a significant

regulatory action under section 3(f) ofExecutive Order 12866, and does notrequire an assessment of potential costsand benefits under section 6(a)(3) of thatorder. It has been exempted from reviewby the Office of Management andBudget under that order. It is notsignificant under the regulatory policiesand procedures of the Department ofTransportation (DOT) (44 FR 11040;February 26, 1979). The Coast Guardexpects the economic impact to be sominimal that a full RegulatoryEvaluation, under paragraph 10e of theregulatory policies and procedures ofDOT, is unnecessary. This conclusion isbased on the fact that the regulation willnot prevent mariners from transiting thebridge. It will only require that marinersplan their transits.

Small EntitiesUnder the Regulatory Flexibility Act

(5 U.S.C. 601 et seq.), the Coast Guardmust consider whether this action willhave a significant economic impact ona substantial number of small entities.‘‘Small entities’’ include independentlyowned and operated small businessesthat are not dominant in their fields andthat otherwise qualify as ‘‘smallbusiness concerns’’ under Section 3 ofthe Small Business Act (15 U.S.C. 632).Because of the reasons discussed in theRegulatory Evaluation above, the CoastGuard certifies under 5 U.S.C. 605(b)that this action, if adopted, will nothave a significant economic impact ona substantial number of small entities.

Collection of InformationThis rule contains no collection of

information requirements under thePaperwork Reduction Act (44 U.S.C.3501 et seq.).

FederalismThe Coast Guard has analyzed this

proposal in accordance with theprinciples and criteria contained inExecutive Order 12612, and it hasdetermined that this proposedregulation does not have sufficientfederalism implications to warrantpreparation of a Federalism Assessment.

Environment

The Coast Guard considered theenvironmental impact of this proposaland concluded that, under section2.B.2.e(32)(e) of CommandantInstruction M16475.1B, this proposal iscategorically excluded from furtherenvironmental documentation. ACategorical Exclusion Determination isavailable in the docket for inspection orcopying where indicated underADDRESSES.


Bridges.For the reasons set out in the

preamble, the Coast Guard proposes toamend 33 CFR part 117 as follows:

PART 117—DRAWBRIDGEOPERATION REGULATIONS


Authority: 33 U.S.C. 499; 49 CFR 1.46; 33CFR 1.05–1(g); section 117.255 also issuedunder the authority of Pub. L. 102–587, 106Stat. 5039.

2. Section 117.802 is added to read asfollows:

§ 117.802 New Rochelle Harbor.

(a) The draw of the Glen IslandBridge, mile 0.8 over New RochelleHarbor, shall open on signal, except asfollows:

(1) The draw need not open from 1May through 31 October, between 12midnight and 8 a.m.

(2) The draw need not open from 1November through 30 April, between 8p.m. and 8 a.m.

(b) The owners of the bridge shallprovide, and keep in good legiblecondition, clearance gauges for eachdraw with figures not less than twelve(12) inches high, designed, installed andmaintained according to the provisionsof § 118.160 of this chapter.

Dated: January 17, 1995.R.R. Clark,Captain, U.S. Coast Guard, ActingCommander, First Coast Guard District.[FR Doc. 95–2090 Filed 1–26–95; 8:45 am]BILLING CODE 4910–14–M


40 CFR Parts 51, 52, 60, 61, and 64

[FRL–5147–3]

Enhanced Monitoring Program

AGENCY: Environmental ProtectionAgency (EPA).

ACTION: Proposed rule; notice ofcomment period extension.

SUMMARY: This document extends untilFebruary 3, 1995 the public commentperiod on a limited number of specificissues concerning the proposedEnhanced Monitoring Program, 40 CFRparts 51, 52, 60, 61, and 64. Theproposal was published on October 22,1993 (58 FR 54648). On December 28,1994, the public comment period wasreopened to solicit comment on alimited number of specific issues (59 FR66844). At the request of severalcommenters, EPA is extending thecomment period for an additional sevendays. The extension is limited to thisshort period because the enhancedmonitoring rulemaking is subject to acourt-ordered deadline of April 30,1995, established by a consent decree inSierra Club v. Browner, No. 93–0124(NHJ)(D.D.C.). The extension of thepublic comment period is limited to theissues identified in the notice publishedDecember 28, 1994.

In addition, the EPA encouragespublic comment on the EnhancedMonitoring Reference Document and theassociated Data Quality Objectives(DQO) process referenced in the noticepublished December 28, 1994 (see 59 FR66844, 66846), not only during thispublic comment period but afterwardsas well. In this manner, the EnhancedMonitoring Reference Document can beupdated on a regular basis.

DATES: Comments on the limitednumber of specific issues identified inthe December 28, 1994 notice must bereceived by February 3, 1995.

ADDRESSES: Comments must be mailed(in duplicate, if possible) to: EPA AirDocket (6102), Attention: Docket No. A–91–52, Room M–1500, Waterside Mall,401 M Street SW, Washington, DC20460. Docket: Supporting informationused in developing the proposedregulations is contained in Docket No.A–91–52. This docket is available forpublic inspection and copying between8 a.m. and 5:30 p.m. Monday throughFriday, excluding government holidays,and is located at EPA Air Docket (6102),Room M–1500, Waterside Mall, 401 MStreet SW, Washington, DC 20460. Areasonable fee may be charged forcopying.

FOR FURTHER INFORMATION CONTACT:Scott Throwe, U.S. EnvironmentalProtection Agency, Office ofEnforcement and ComplianceAssurance, Manufacturing, Energy andTransportation Division, at (202) 564–7013.


Dated: January 25, 1995.Steven A. Herman,Assistant Administrator for Enforcement andCompliance Assurance.[FR Doc. 95–2158 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–P

40 CFR Part 52

[MT23–1–6402b; FRL–5128–2]

Approval and Promulgation of AirQuality Implementation Plans;Montana; State Implementation Planfor East Helena SO2 NonattainmentArea

AGENCY: Environmental ProtectionAgency (EPA).ACTION: Proposed rule.

SUMMARY: EPA proposes to fullyapprove the State implementation plan(SIP) submitted by the State of Montanato achieve attainment of the primaryNational Ambient Air Quality Standards(NAAQS) for sulfur dioxide (SO2). TheSIP was submitted by Montana to satisfycertain federal requirements for anapprovable nonattainment area SO2 SIPfor East Helena. In the Final RulesSection of this Federal Register, EPA isapproving the State’s SIP revision, as adirect final rule without prior proposalbecause the Agency views this as anoncontroversial revision amendmentand anticipates no adverse comments. Adetailed rationale for the approval is setforth in the direct final rule. If noadverse comments are received inresponse to this proposed rule, nofurther activity is contemplated inrelation to this rule. If EPA receivesadverse comments, the direct final rulewill be withdrawn and all publiccomments received will be addressed ina subsequent final rule based on thisproposed rule. EPA will not institute asecond comment period on this action.Any parties interested in commentingon this action should do so at this time.DATES: Comments on this proposed rulemust be received in writing by February27, 1995.ADDRESSES: Written comments shouldbe addressed to Meredith A. Bond at theEPA Regional Office listed below.Copies of the documents relevant to thisproposed rule are available for publicinspection during normal businesshours at the following locations: U.S.Environmental Protection Agency,Region VIII, Air Programs Branch(8ART–AP), 999 18th Street, Suite 500,Denver, Colorado 80202–2405; andMontana Department of Health andEnvironmental Sciences, Air QualityBureau, 836 Front Street, P.O. Box200901, Helena, Montana 59620–0901.

FOR FURTHER INFORMATION CONTACT:Meredith Bond at (303)293–1764.SUPPLEMENTARY INFORMATION: See theinformation provided in the Direct Finalnotice which is located in the RulesSection of this Federal Register.


Environmental Protection, Airpollution control, Incorporation byreference, Intergovernmental relations,Reporting and recordkeepingrequirements, Sulfur dioxide.

Authority: 42 U.S.C. 7401–7671q.Dated: December 14, 1994.

William P. Yellowtail,Regional Administrator.[FR Doc. 95–2018 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–P

40 CFR Part 52

[IL105–1–6841b; FRL–5139–6]

Approval and Promulgation ofImplementation Plans; Illinois

AGENCY: U.S. Environmental ProtectionAgency (USEPA).ACTION: Proposed rule.

SUMMARY: The United StatesEnvironmental Protection Agency(USEPA) proposes to approve the StateImplementation Plan (SIP) revisionrequest submitted by the State of Illinoison October 25, 1994, for the purpose ofrequiring the installation of pressure/vacuum (P/V) relief valves on storagetank vent pipes at certain gasolinedispensing operations in the Chicagoand Metro-East St. Louis (Metro-East)ozone nonattainment areas. In the finalrules section of this Federal Register,the USEPA is approving this action asa direct final rule without prior proposalbecause USEPA views this as anoncontroversial action and anticipatesno adverse comments. A detailedrationale for the approval is set forth inthe direct final rule. If no adversecomments are received in response tothat direct final rule, no further activityis contemplated in relation to thisproposed rule. If USEPA receivesadverse comments, the direct final rulewill be withdrawn and all publiccomments received will be addressed ina subsequent final rule based on theproposed rule. USEPA will not institutea second comment period on this action.Any parties interested in commentingon this document should do so at thistime.DATES: Comments on this proposed rulemust be received on or before February27, 1995.

ADDRESSES: Written comments shouldbe mailed to: J. Elmer Bortzer, Chief,Regulation Development Section,Regulation Development Branch (AR18-J), U.S. Environmental ProtectionAgency, Region 5, 77 West JacksonBoulevard, Chicago, Illinois 60604.

Copies of the State submittal andUSEPA’s analysis of it are available forinspection at: Regulation DevelopmentSection, Regulation DevelopmentBranch (AR18-J), U.S. EnvironmentalProtection Agency, Region 5, 77 WestJackson Boulevard, Chicago, Illinois60604.FOR FURTHER INFORMATION CONTACT:Francisco Acevedo, RegulationDevelopment Section, RegulationDevelopment Branch (AR–18J), U.S.Environmental Protection Agency,Region 5, 77 West Jackson Boulevard,Chicago, Illinois 60604, (312) 886–6061.SUPPLEMENTARY INFORMATION: Foradditional information see the directfinal rule published in the rules sectionof this Federal Register.

Dated: December 29, 1994.Valdas V. Adamkus,Regional Administrator.[FR Doc. 95–2016 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–F



49 CFR Part 571

Occupant Crash Protection; Denial ofPetition for Rulemaking

AGENCY: National Highway TrafficSafety Administration (NHTSA),Department of Transportation.ACTION: Denial of petition forrulemaking.

SUMMARY: This document announces thedenial of a petition for rulemakingsubmitted by the Institute for InjuryReduction (IIR). The petitionerrequested ‘‘rulemaking or other action’’to require manufacturers to provide aspecific warning for occupants to uselap belts in new vehicles with automaticsafety belts. However, under a newstatutory requirement, automatic safetybelts are rapidly being replaced by thecombination of air bags and manual lap/shoulder belts. Hence, the agencyexpects any safety concerns withautomatic safety belts to become moot.Therefore, the petition is denied.FOR FURTHER INFORMATION CONTACT: Mr.Dan Cohen, Chief, Office of VehicleSafety Standards, National Highway


Traffic Safety Administration, 400Seventh Street, SW., Washington, DC20590. Telephone: (202) 366–2264.SUPPLEMENTARY INFORMATION: NHTSAreceived a petition for rulemaking fromthe Institute for Injury Reduction (IIR).The petitioner requested ‘‘appropriaterulemaking or other action leading tothe issuance * * * of a lap-belt-usewarning requirement covering newvehicles sold in the United States andequipped with ‘automatic’ shoulderbelts in any position.’’

IIR argued that an automaticshoulder/manual lap belt restraintsystem often provides less protection ina crash than a fully manual shoulder/lapbelt restraint system. According to thepetitioner, ‘‘a significant hazard of theformer system is the overall propensityfor ejection due to the non-use of the lapbelt in conjunction with the automaticshoulder belt.’’ The petitioner requestedthat NHTSA require a warning that anautomatic shoulder belt is not to be usedwithout a lap belt, and that the agency‘‘develop appropriate minimumperformance standards specifyingwarning language and location, orcriteria.’’

NHTSA notes that it previouslyresponded to a petition for rulemakingrelated to the subject of non-use ofmanual lap belts in conjunction withautomatic shoulder belts. On September9, 1993, NHTSA published (58 FR47427) a notice denying a petitionrequesting that a warning light berequired to indicate when lap belts invehicles with automatic safety belts arenot fastened. That petition had beensubmitted by Mr. Mark Goodson.

Like IIR, Mr. Goodson was concernedthat if the person using an automaticsafety belt does not engage the lap belt,the benefits of a three point restraint arereduced, and the person risks personalinjury should a collision occur. Mr.Goodson recommended the addition ofa warning light to remind users toengage the lap belt.

In denying Mr. Goodson’s petition,NHTSA cited the fact that automaticbelts are rapidly being replaced by thecombination of air bags and manual lap/shoulder belts. Under the IntermodalSurface Transportation Efficiency Act of1991 (ISTEA), all passenger cars andlight trucks must provide automatic

crash protection by means of air bags,beginning in the late 1990’s.

More specifically, as explained inNHTSA’s final rule implementing thatpart of ISTEA, at least 95 percent ofeach manufacturer’s passenger carsmanufactured on or after September 1,1996 and before September 1, 1997 mustbe equipped with an air bag and amanual lap/shoulder belt at both thedriver’s and right front passenger’sseating position. Every passenger carmanufactured on or after September 1,1997 must be so equipped. The samerequirement for light trucks is beingphased in beginning on September 1,1997. See 58 FR 46551, September 2,1993.

Prior to the enactment of ISTEA,manufacturers had been permittedunder Standard No. 208, OccupantCrash Protection, to provide automaticcrash protection by means of air bags orautomatic belts. The automatic crashprotection requirements for cars havebeen in effect since the late 1980’s; therequirements began to be phased in forlight trucks on September 1, 1994.

Manufacturers are in fact movingmore quickly toward providing air bagsthan required by ISTEA. Ninety-ninepercent of model year 1995 passengercars are equipped with driver-side airbags, and about 87 percent are alsoequipped with passenger-side air bags.Moreover, in meeting the automaticcrash protection phase-in requirementsfor light trucks, manufacturers are goingdirectly to air bags rather than taking theinterim step of installing automaticbelts.

In the notice denying Mr. Goodson’spetition, NHTSA stated that it expectsany safety concerns with two-pointautomatic belts to become moot asautomatic belts are replaced by air bagswith manual lap/shoulder belts. Theagency indicated that, given the limitedtime until automatic belts are replacedby air bags, it believes that any problemscan be addressed by public educationefforts. NHTSA noted that on October 5,1992, it issued a news release statingthat ‘‘drivers and passengers of carsequipped with front-seat automaticshoulder belts should also use themanual lap belt for maximumprotection.’’ The agency stated that itwould continue to periodically remind

consumers of the need to wear themanual lap belt which accompaniessome forms of automatic belts.

NHTSA believes that the samerationale for denying Mr. Goodson’spetition also applies to the IIR petition.In fact, the time until automatic belts arereplaced by air bags is even morelimited. By the time the agencycompleted any rulemaking to require aspecific warning, it is unlikely that anyvehicles would be subject to therequirement. Therefore, such arulemaking would not result in anysafety benefits. Accordingly, the agencyfinds that there is not a reasonablepossibility that the requested rule wouldbe issued at the conclusion of arulemaking proceeding.

The agency continues to believe thatany problems in this area can beaddressed by public education efforts.This is true for both the small numberof new vehicles that will be producedwith two-point automatic belts and forthe existing vehicles incorporating thisdesign. NHTSA notes that its consumerinformation pamphlet entitled ‘‘SafetyBelts Proper Use’’ includes thefollowing statement:

In some vehicles, the shoulder belt comesacross your chest automatically, but the lapbelt must be buckled manually. If yourvehicle has a manual lap belt, it must bebuckled for maximum protection. Use thecomplete system the manufacturer installedin your vehicle and follow the instructionsprovided in the owner’s manual.

NHTSA shares IIR’s concern about theneed for occupants to fully utilize thecrash protection equipment provided bymanufacturers, whether the manual lapbelt provided with some automatic beltsor the manual lap/shoulder belts beingprovided with air bags. The agency willcontinue its public education efforts inthese areas.

For the reasons discussed above, theagency is denying the IIR petition.

Authority: 49 U.S.C. 30103 and 30162;delegations of authority at 49 CFR 1.50 and501.8.

Issued on: January 23, 1995.Barry Felrice,Associate Administrator for Rulemaking.[FR Doc. 95–2116 Filed 1–26–95; 8:45 am]BILLING CODE 4910–59–P

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.

Notices Federal Register

5347

Vol. 60, No. 18



Forest Service

Environmental Impact Statement forthe South Lindenberg Timber Sale(s),Tongass National Forest, Alaska

AGENCY: USDA, Forest Service.ACTION: Revised Notice of Intent toprepare an environmental impactstatement (revises previous NOI, page38557 in the 7/19/93 Federal Register).

SUMMARY: The proposed action is toharvest approximately 40 million boardfeet of timber and build the associatedroad system. The existing Tonka logtransfer facility would be used. Thestudy area is located southwest ofPetersburg, Alaska, on KupreanofIsland. It encompasses approximately65,000 acres at elevations ranging fromsea level to 3,000 feet. The area includesVCUs 437 and 439 and portions of 447and 448. This includes townships 58,59, 60, and 61 south, and ranges 77, 78,and 79 east, Copper River Meridian.DATES: Additional commentsconcerning the proposal to harvesttimber in the South Lindenberg studyarea should be received in writing byMarch 15, 1995. Send requests forfurther information or writtencomments to Jim Thompson, PlanningTeam Leader, USDA Forest Service, P.O.Box 1328, Petersburg, AK, 99833 (907)772–3871.


1. Purpose and Scope of the Decision

The purpose of the project is toprovide approximately 40 million boardfeet of timber for harvest according todirection described in the Tongass LandManagement Plan, to meet the Federalobligation to make timber volumeavailable for harvest by timberoperators, and to improve the timberproductivity of the project area byharvesting mature stands of timber and

replacing them with faster growingstands of second-growth timber.

The decision to be made is whether tomake timber available for harvest andimprove timber productivity in theSouth Lindenberg Study Area while alsoproviding a combination of recreation,fish, water, and wildlife for the resourceuses of society now and into the future.This decision will be made by AbigailR. Kimbell, Forest Supervisor of theStikine Area.

If timber is made available for harvest,the Forest Supervisor will also decide(a) the volume of timber to makeavailable, (b) the location and design ofthe timber harvest units and log transferfacilities, (c) the location and design ofassociated mainline and local roadcorridors, and (d) appropriate mitigationmeasures for all alternatives in theproject area.

1a. Public Involvement ProcessA public scoping letter was sent to all

persons who indicated an interest in theproject by responding to the StikineArea Project Schedule, or whootherwise notified the Stikine Area thatthey were interested in the SouthLindenberg Timber Harvest project.Public meetings were held to gatheradditional information from interestedpersons.

1b. AlternativesAlternatives will include the no

action alternative, and are likely toinclude three to five action alternatives,all of which will harvest approximately40 million board feet of timber. Thealternatives will vary according to thelocation of units, for example onealternative may spread harvest unitsevenly through the study area whileanother may concentrate the harvest ina portion of the study area. The roadsystems will vary with each alternativeaccordingly.

1c. Significant Issues1. Timber Management. How will

long-term forest health and productivitybe affected by harvesting and thespecific harvest treatments proposed forthe South Lindenberg area?

2. Harvest Economics. Will actionalternatives within the study areainclude timber harvest that is profitableand meet economic criteria on theTongass National Forest?

3. Soils. To what degree will soilerosion and sedimentation increase as a

result of harvest activities and theconstruction of roads in the SouthLindenberg area?

4. Watersheds. To what degree willtimber harvesting affect the hydrologicbalance and water quality of streams inthe South Lindenberg study area?

5. Fisheries. What effects will timberharvest and road construction have onhabitats used by trout and salmon?

6. Wildlife. What effects will timberharvest and related activities have onwildlife habitat?

7. Threatened and EndangeredSpecies. To what extent will harvestingand road construction result in impactsto any populations of threatened orendangered species?

8. Biodiversity. To what extent willtimber harvesting associated with theSouth Lindenberg Sale affect thebiodiversity and old growth structure ofKupreanof Island?

9. Subsistence. To what extent willeach alternative affect subsistenceresources and use within the study area?

10. Recreation. What effect will eachalternative have on recreationalopportunities?

11. Visual Appearance. To whatextent will each alternative influencethe landscape character of the studyarea, and to what extent will harvestdesigns be mitigated to protect visualguality?

2. Expected Time for CompletionA draft Environmental Impact

Statement is projected for issuanceapproximately March 1995. Issuance ofthe Final Environmental ImpactStatement is projected for August 1995.

3. CommentsInterested publics are invited to

comment.The comment period on the draft

environmental impact statement will be45 days from the date of theEnvironmental Protection Agency’snotice of availability appears in theFederal Register. The Forest Servicebelieves, at this early stage, it isimportant to give reviewers notice ofseveral court rulings related to publicparticipation in the environmentalreview process.

First, reviewers of draftenvironmental impact statements muststructure their participation in theenvironmental review of the proposal sothat it is meaningful and alerts anagency to the reviewer’s position and

5348 Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Notices

1 In its October 21, 1994, submission, respondentargued that the subject merchandise constitutes twoclasses or kind of merchandise—less than or equalto 2 inches and greater than 2 inches. Based on thisallegation, it contended that the petitioner lackedstanding to initiate an investigation with regard toseamless pipe and tube between 23⁄8 and 4.5 inchesin outside diameter because it does not producesuch merchandise. (See ‘‘Standing’’ section of thisnotice.)

contentions. Vermont Yankee NuclearPower Corp. v. NRDC, 435 U.S. 519,553, (1978).

Also, environmental objections thatcould be raised at the draftenvironmental impact statement stagebut are not raised until after completionof the final environmental impactstatement may be waived or dismissedby the courts. City of Angoon v. Hodel,803 f.2d 1016, 1022, (9th Cir. 1986) andWisconsin Heritages, Inc., v. Harris, 490F. Supp. 1334, 1338 (E.D. Wis. 1980).

Because of these court rulings, it isvery important that those interested inthis proposed action participate by theclose of the Draft EIS comment periodso that substantive comments andobjections are made available to theForest Service at a time when it canmeaningfully consider them andrespond to them in the finalenvironmental impact statement.

To assist the Forest Service inidentifying and considering issues andconcerns on the proposed actions,comments on the draft environmentalimpact statement should be as specificas possible. It is also helpful ifcomments refer to specific pages orchapters of the draft statement.Comments may also address theadequacy of the draft environmentalimpact statement or the merits of thealternatives formulated and discussed inthe statement. Reviewers may wish torefer to the Council on EnvironmentalQuality Regulations for implementingthe procedural provisions of theNational Environmental Policy Act at 40CFR 1503.3 in addressing these points.

The responsible official for thedecision is Abigail R. Kimbell, StikineArea Forest Supervisor, Petersburg,Alaska.

Written comments and suggestionsconcerning the analysis andEnvironmental Impact Statement shouldbe sent to Jim Thompson, ID TeamLeader, P.O. Box 1328, Petersburg, AK,99833, (907) 772–3871.


Abigail R. Kimbell,Forest Supervisor.[FR Doc. 95–2027 Filed 1–26–95; 8:45 am]

BILLING CODE 3410–11–M


International Trade Administration

[A–357–809]

Notice of Preliminary Determination ofSales at Less Than Fair Value: SmallDiameter Circular Seamless Carbonand Alloy Steel Standard, Line, andPressure Pipe From Argentina

AGENCY: Import Administration,International Trade Administration,Department of Commerce.EFFECTIVE DATE: January 27, 1995.FOR FURTHER INFORMATION CONTACT:Irene Darzenta or Kate Johnson, Officeof Antidumping Investigations, ImportAdministration, International TradeAdministration, U.S. Department ofCommerce, 14th Street and ConstitutionAvenue, N.W., Washington, D.C. 20230;telephone (202) 482–6320 or (202) 482–4929.

Preliminary DeterminationThe Department of Commerce (the

Department) preliminarily determinesthat small diameter circular seamlesscarbon and alloy steel standard, line,and pressure pipe (seamless pipe) fromArgentina is being, or is likely to be,sold in the United States at less than fairvalue, as provided in section 733 of theTariff Act of 1930, as amended (the Act).The estimated margins are shown in the‘‘Suspension of Liquidation’’ section ofthis notice.

Case HistorySince the notice of initiation on July

13, 1994 (59 FR 37025, July 20, 1994),the following events have occurred.

On July 18, 1994, Siderca Corporationof Houston, Texas, an importer of thesubject merchandise from Argentina,challenged the standing of petitioner fora considerable portion of the subjectmerchandise on the ground thatpetitioner is not an ‘‘interested party.’’On September 1, 1994, Sidercasubmitted a letter clarifying its July 18,1994, submission.

On August 8, 1994, the U.S.International Trade Commission (ITC)issued an affirmative preliminary injurydetermination (USITC Publication 2734,August 1994).

On August 19, 1994, we sent aquestionnaire to Siderca S.A.I.C.(Siderca), the only named respondent inthis investigation. On September 12,1994, Siderca informed the Departmentthat it would not be responding to thequestionnaire.

On October 21 and 31, 1994,(respectively) both petitioner andrespondent provided comment andrebuttal on the issue of class or kind of

merchandise 1 in response to theDepartment’s request for comments inthe notice of initiation. Petitionersubmitted additional comments onNovember 17, 1994.

On October 27, 1994, the Departmentreceived a request from petitioner topostpone the preliminary determinationuntil January 19, 1995. On November18, 1994, we published in the FederalRegister (59 FR 59748), a noticeannouncing the postponement of thepreliminary determination until notlater than January 19, 1995, pursuant topetitioner’s request, in accordance with19 C.F.R. 353.15 (c) and (d).

Scope of InvestigationFor purposes of this investigation,

seamless pipes are seamless carbon andalloy (other than stainless) steel pipes,of circular cross-section, not more than114.3mm (4.5 inches) in outsidediameter, regardless of wall thickness,manufacturing process (hot-finished orcold-drawn), end finish (plain end,bevelled end, upset end, threaded, orthreaded and coupled), or surface finish.These pipes are commonly known asstandard pipe, line pipe or pressurepipe, depending upon the application.They may also be used in structuralapplications.

The seamless pipes subject to theseinvestigations are currently classifiableunder subheadings 7304.10.10.20,7304.10.50.20, 7304.31.60.50,7304.39.00.16, 7304.39.00.20,7304.39.00.24, 7304.39.00.28,7304.39.00.32, 7304.51.50.05,7304.51.50.60, 7304.59.60.00,7304.59.80.10, 7304.59.80.15,7304.59.80.20, and 7304.59.80.25 of theHarmonized Tariff Schedule of theUnited States (HTSUS).

The following information furtherdefines the scope of this investigation,which covers pipes meeting thephysical parameters described above:

Specifications, Characteristics andUses: Seamless pressure pipes areintended for the conveyance of water,steam, petrochemicals, chemicals, oilproducts, natural gas and other liquidsand gasses in industrial piping systems.They may carry these substances atelevated pressures and temperaturesand may be subject to the application ofexternal heat. Seamless carbon steelpressure pipe meeting the American

5349Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Notices

2 Various parties in this investigation, as well asin the concurrent investigations involving the sameproduct from Argentina, Italy, and Germany haveraised issues and made arguments. For purposes ofsimplicity and consistency across investigations, wewill discuss all of these issues in this notice.

Society for Testing and Materials(ASTM) standard A–106 may be used intemperatures of up to 1000 degreesFahrenheit, at various American Societyof Mechanical Engineers (ASME) codestress levels. Alloy pipes made to ASTMstandard A–335 must be used iftemperatures and stress levels exceedthose allowed for A–106 and the ASMEcodes. Seamless pressure pipes sold inthe United States are commonlyproduced to the ASTM A–106 standard.

Seamless standard pipes are mostcommonly produced to the ASTM A–53specification and generally are notintended for high temperature service.They are intended for the lowtemperature and pressure conveyance ofwater, steam, natural gas, air and otherliquids and gasses in plumbing andheating systems, air conditioning units,automatic sprinkler systems, and otherrelated uses. Standard pipes (dependingon type and code) may carry liquids atelevated temperatures but must notexceed relevant ASME coderequirements.

Seamless line pipes are intended forthe conveyance of oil and natural gas orother fluids in pipe lines. Seamless linepipes are produced to the API 5Lspecification.

Seamless pipes are commonlyproduced and certified to meet ASTMA–106, ASTM A–53 and API 5Lspecifications. Such triple certificationof pipes is common because all pipesmeeting the stringent A–106specification necessarily meet the API5L and ASTM A–53 specifications.Pipes meeting the API 5L specificationnecessarily meet the ASTM A–53specification. However, pipes meetingthe A–53 or API 5L specifications do notnecessarily meet the A–106specification. To avoid maintainingseparate production runs and separateinventories, manufacturers triple certifythe pipes. Since distributors sell the vastmajority of this product, they canthereby maintain a single inventory toservice all customers.

The primary application of ASTM A–106 pressure pipes and triple certifiedpipes is in pressure piping systems byrefineries, petrochemical plants andchemical plants. Other applications arein power generation plants (electrical-fossil fuel or nuclear), and in some oilfield uses (on shore and off shore) suchas for separator lines, gathering linesand metering runs. A minor applicationof this product is for use as oil and gasdistribution lines for commercialapplications. These applicationsconstitute the majority of the market forthe subject seamless pipes. However, A–106 pipes may be used in some boilerapplications.

The scope of this investigationincludes all multiple-stenciled seamlesspipe meeting the physical parametersdescribed above and produced to one ofthe specifications listed above, whetheror not also certified to a non-coveredspecification. Standard, line andpressure applications are definingcharacteristics of the scope of thisinvestigation. Therefore, seamless pipesmeeting the physical description above,but not produced to the A–106, A–53,or API 5L standards shall be covered ifused in an A–106, A–335, A–53, or API5L application.

For example, there are certain otherASTM specifications of pipe which,because of overlapping characteristics,could potentially be used in A–106applications. These specificationsinclude A–162, A–192, A–210, A–333,and A–524. When such pipes are usedin a standard, line or pressure pipeapplication, such products are coveredby the scope of this investigation.

Specifically excluded from thisinvestigation are boiler tubing,mechanical tubing and oil countrytubular goods except when used in astandard, line or pressure pipeapplication. Also excluded from thisinvestigation are redraw hollows forcold-drawing when used in theproduction of cold-drawn pipe or tube.

Although the HTSUS subheadings areprovided for convenience and customspurposes, our written description of thescope of this investigation is dispositive.

Scope IssuesIn our notice of initiation we

identified two issues which weintended to consider further. The firstissue was whether to consider end-usea factor in defining the scope of theseinvestigations.2 The second issue waswhether the seamless pipe subject tothis investigation constitutes more thanone class or kind of merchandise. Inaddition to these two issues, interestedparties have raised a number of otherissues regarding whether certainproducts should be excluded from thescope of this investigation. These issuesare discussed below.

Regarding the end-use issue,interested parties have submittedarguments about whether end-useshould be maintained as a scopecriterion in this investigation. Aftercarefully considering these arguments,we have determined that, for purposesof this preliminary determination, we

will continue to include end-use as ascope criterion. We agree withpetitioner that pipe products identifiedas potential substitutes used in the sameapplications as products meeting therequisite ASTM specifications may fallwithin the same class or kind, andwithin the scope of any order issued inthis investigation. However, we are wellaware of the difficulties involved withrequiring end-use certifications,particularly the burdens placed on theDepartment, the U.S. Customs Service,and the parties. We will strive tosimplify any procedures used in thisregard. We will, therefore, carefullyconsider any comment on this issue forpurposes of our final determination.

Regarding the class or kind issue,although respondents propose dividingthe scope of this investigation into twoclasses or kinds of merchandise, they donot agree on the merchandisecharacteristics that will define the twoclasses. The respondent in thisinvestigation argues that the scopeshould be divided into two classes orkinds of merchandise based on size. Therespondents in the Brazilian andGerman investigations argue that thescope should be divided into twoclasses or kinds based on the materialcomposition of the pipe—carbon versusalloy. Petitioner maintains that thesubject merchandise constitutes a singleclass or kind.

We have considered the class or kindcomments of the interested parties andhave analyzed this issue based on thecriteria set forth by the Court ofInternational Trade in DiversifiedProducts v. United States, 6 CIT 155,572 F. Supp. 883 (1983). These criteriaare as follows: (1) The general physicalcharacteristics of the merchandise; (2)the ultimate use of the merchandise; (3)the expectations of the ultimatepurchasers; (4) the channels of trade;and (5) cost.

We note that certain differences existbetween the physical characteristics ofthe various products (e.g., size,composition). In addition, there appearto be cost differences between thevarious products. However, theinformation on record is not sufficientto justify dividing the class or kind ofmerchandise. The record on ultimateuse of the merchandise and theexpectations of the ultimate purchasersindicates that there is a strongpossibility that there may beoverlapping uses because any one of thevarious products in question may beused in different applications (e.g., lineand pressure pipe). Also, based uponthe evidence currently on the record, wedetermine that the similarities in thedistribution channels used for each of


the proposed classes of merchandiseoutweigh any differences in thedistribution channels.

In conclusion, while we recognizethat certain differences exist betweenthe products in the proposed class orkind of merchandise, we find that thesimilarities are more significant.Therefore, for purposes of thispreliminary determination, we willcontinue to consider the scope ascovering one class or kind ofmerchandise. This preliminary decisionis consistent with past cases concerningsteel pipe products. (See e.g., FinalDetermination of Sales at Less ThanFair Value: Circular Welded Non-AlloySteel Pipe From Brazil et. al., 57 FR42940, September 17, 1992). However, anumber of issues with respect to classor kind remain to be clarified. We willprovide the parties with anotheropportunity to submit additionalinformation and argument for the finaldetermination. For a completediscussion of the parties’ comments, aswell as the Department’s analysis, seememorandum from Gary Taverman,Acting Director, Office of AntidumpingInvestigations to Barbara Stafford,Deputy Assistant Secretary forInvestigations, dated January 19, 1995.

Regarding the additional issuesconcerning exclusion of certainproducts, one party requests that theDepartment specify that multiple-stencilled seamless pipe stencilled tonon-subject standards is not covered.Furthermore, this party argues that thescope language should be clarified sothat it specifically states that onlystandard, line, and pressure pipestencilled to the ASTM A–106, ASTMA–53 or API–5L standards are included,and that we clarify the meaning of‘‘mechanical tubing.’’ In addition, thisparty requests that the Departmentexclude unfinished oil country tubulargoods, ASTM A–519 pipe (a type ofmechanical tubing) and mechanical tubemade to customer specifications fromthe scope of this investigation.

Another party requests that theDepartment specifically exclude hollowseamless steel products produced innon-pipe sizes (known in the steelindustry as tubes), from the scope of thisinvestigation.

Because we currently haveinsufficient evidence to make adetermination regarding these requests,we are not yet in a position to addressthese concerns. Therefore, for purposesof this preliminary determination, wewill not exclude these products from thescope of this investigation. Once again,we will collect additional informationand consider additional argument beforethe final determination.

Period of Investigation

The period of investigation is January1, 1994 through June 30, 1994.

Standing

Siderca has challenged petitioner’sstanding with respect to seamless pipeand tube between 23⁄8 and 4.5 inches inoutside diameter. An interested party asdefined, inter alia, in 353.2(k)(3) hasstanding to file a petition. (See 19 C.F.R.353.12(a).) Further, section 353.2(k)(3)defines an interested party as a producerof the like product. In this investigation,the ITC has determined that there is asingle like product. (See USITCPublication 2734, August 1994.) Forpurposes of determining standing, wehave preliminarily accepted the ITC’sdetermination that the merchandisesubject to this investigation constitutesa single like product consisting ofcircular seamless carbon and alloy steelstandard, line and pressure pipe, andtubes not more than 4.5 inches inoutside diameter, and including redrawhollows (See USITC Publication 2734 at18.) Therefore, because petitioner is aproducer of the like product, wepreliminarily determine that thepetitioner has standing.

Best Information Available

In accordance with section 776(c) ofthe Act, we have determined that theuse of best information available (BIA)is appropriate for Siderca, the onlynamed respondent in this investigation.On September 12, 1994, as stated above,Siderca notified the Department that itwould not participate in thisinvestigation. Because Siderca refusedto answer the Department’squestionnaire, we find it has notcooperated in this investigation.

The Department’s BIA methodologyfor uncooperative respondents is toassign the higher of the highest marginalleged in the petition or the highest ratecalculated for another respondent.Accordingly, because there are no otherrespondents in this investigation, asBIA, we are assigning the highestmargin among the margins alleged inthe petition. See Antifriction Bearings(Other Than Tapered Roller Bearings)and Parts Thereof From the FederalRepublic of Germany; Final Results ofAntidumping Duty AdministrativeReview (56 FR 31692, 31704, July 11,1991). The Department’s methodologyfor assigning BIA has been upheld bythe U.S. Court of Appeals of the FederalCircuit. See Allied Signal Aerospace Co.v. United States, 996 F.2d 1185 (Fed.Cir. 1993); see also Krupp Stahl, AG etal. v. United States, 822 F. Supp. 789(CIT 1993).

Suspension of LiquidationIn accordance with section 733(d)(1)

(19 U.S.C. 1673b(d)(1)) of the Act, weare directing the U.S. Customs Serviceto suspend liquidation of all entries ofseamless pipe from Argentina, asdefined in the ‘‘Scope of Investigation’’section of this notice, that are entered,or withdrawn from warehouse, forconsumption on or after the date ofpublication of this notice in the FederalRegister. The Customs Service shallrequire a cash deposit or posting of abond equal to the estimated marginamount by which the foreign marketvalue of the subject merchandiseexceeds the United States price asshown below. The suspension ofliquidation will remain in effect untilfurther notice.

Manufacturer/producer/exporter

Weightedaveragemarginpercent

Siderca S.A.I.C. .......................... 108.13All Others .................................... 108.13

ITC NotificationIn accordance with section 733(f) of

the Act, we have notified the ITC of ourdetermination. If our finaldetermination is affirmative, the ITCwill determine whether imports of thesubject merchandise are materiallyinjuring, or threaten material injury to,the U.S. industry, before the later of 120days after the date of the preliminarydetermination or 45 days after our finaldetermination.

Public CommentIn accordance with 19 CFR 353.38,

case briefs or other written commentsmust be submitted, in at least tencopies, to the Assistant Secretary forImport Administration no later thanMarch 10, 1995, and rebuttal briefs nolater than March 15, 1995. In addition,a public version and five copies shouldbe submitted by the appropriate date ifthe submission contains businessproprietary information. In accordancewith 19 CFR 353.38(b), we will hold apublic hearing, if requested, to affordinterested parties an opportunity tocomment on arguments raised in case orrebuttal briefs. Tentatively, the hearingwill be held, if requested, at 9:00 a.m.on March 17, 1995, at the U.S.Department of Commerce, Room 1414,14th Street and Constitution AvenueNW., Washington DC 20230. Partiesshould confirm by telephone the time,date, and place of the hearing 48 hoursbefore the scheduled time.

Interested parties who wish to requesta hearing must submit a written request


to the Assistant Secretary for ImportAdministration, U.S. Department ofCommerce, Room B–099 within tendays of the date of publication of thisnotice. Requests should contain: (1) Theparty’s name, address and telephonenumber; (2) the number of participants;and (3) a list of issues to be discussed.In accordance with 19 CFR 353.38(b),oral presentation will be limited toarguments raised in the briefs.

This determination is publishedpursuant to section 733(f) of the Act (19U.S.C. 1673b(f)) and 19 CFR353.15(a)(4).

Dated: January 19, 1995.Susan G. Esserman,Assistant Secretary for ImportAdministration.[FR Doc. 95–2107 Filed 1–26–95; 8:45 am]BILLING CODE 3510–DS–P

[A–351–826]

Notice of Preliminary Determination ofSales at Less Than Fair Value: SmallDiameter Circular Seamless Carbonand Alloy Steel, Standard, Line andPressure Pipe From Brazil

AGENCY: Import Administration,International Trade Administration,Department of Commerce.EFFECTIVE DATE: January 27, 1995.FOR FURTHER INFORMATION CONTACT:Irene Darzenta or Fabian Rivelis, Officeof Antidumping Investigations, ImportAdministration, U.S. Department ofCommerce, 14th Street and ConstitutionAvenue, NW., Washington, DC 20230;telephone (202) 482–6320 or 482–3853,respectively.PRELIMINARY DETERMINATION: TheDepartment of Commerce (theDepartment) preliminarily determinesthat small diameter circular seamlesscarbon and alloy steel, standard, lineand pressure pipe from Brazil (seamlesspipe) is being sold in the United Statesat less than fair value, as provided insection 733 of the Tariff Act of 1930, asamended (the Act). The estimatedmargins are shown in the ‘‘Suspensionof Liquidation’’ section of this notice.

Case HistorySince the notice of initiation on July

13, 1994 (59 FR 37025, July 20, 1994),the following events have occurred.


On August 11, 1994, we sent a cableto the U.S. Embassy in Brazil requestinginformation for purposes of respondentselection. Based on the information

provided by the Embassy, as well as bypetitioner, we identified as the twoproducers of subject merchandise inBrazil Mannesmann S.A. and NCSSiderurgica. On August 19, 1994, wenamed Mannesmann S.A. (MSA) as amandatory respondent in thisinvestigation and issued to it anantidumping questionnaire. Also on thesame date, we sent an antidumpingsurvey to NCS Siderurgica in order todetermine whether it should be requiredto respond to a full questionnaire.Although NCS Siderurgica did notrespond to the survey, based oninformation obtained from Iron andSteel Works of the World andpetitioner’s claim that MSA producedall of the subject merchandise exportedfrom Brazil to the United States duringthe last 12 months prior to the filing ofthe petition, we determined that MSAwould be the sole mandatoryrespondent in this investigation.

On October 21, 1994, we receivedcomments on the issues of scope andclass or kind of merchandise frominterested parties, pursuant to theDepartment’s invitation for suchcomments in its notice of initiation. OnOctober 31 and November 17, 1994, wereceived rebuttal comments on thisissue.

On September 12, 1994, we receivedfrom MSA a response to Section A ofthe Department’s questionnaire.Responses to Sections B and C weresubmitted on October 14, 1994. OnOctober 11, and November 3, 1994, wereceived petitioner’s commentsregarding MSA’s responses to SectionsA, B, and C. We sent MSA asupplemental questionnaire onNovember 18, 1994. MSA submitted itssupplemental response, includingrevised sales listings, on December 9,1994.

On October 27, 1994, the Departmentreceived a request from petitioner topostpone the preliminary determinationuntil January 19, 1995. On November18, 1994, we published in the FederalRegister (59 FR 59748), a noticeannouncing the postponement of thepreliminary determination until notlater than January 19, 1995, inaccordance with 19 C.F.R. 353.15 (c)and (d).

On January 4, 1995, respondentnotified the Department of certainrevisions to be made to its December 9,1994, sales listings because of certainprogramming errors and inconsistenciesconcerning sale dates, grade codes anddifferences-in-merchandise data.

On January 9, 1995, petitionersubmitted comments regarding thequality of MSA’s responses, urging theDepartment to reject the responses and

use best information available (BIA) inthe preliminary determination becauseof the numerous deficiencies containedin these responses.


seamless pipes are seamless carbon andalloy (other than stainless) steel pipes,of circular cross-section, not more than114.3 mm (4.5 inches) in outsidediameter, regardless of wall thickness,manufacturing process (hot-finished orcold-drawn), end finish (plain end,bevelled end, upset end, threaded, orthreaded and coupled), or surface finish.These pipes are commonly known asstandard pipe, line pipe or pressurepipe, depending upon the application.They may also be used in structuralapplications.



Specifications, Characteristics andUses: Seamless pressure pipes areintended for the conveyance of water,steam, petrochemicals, chemicals, oilproducts, natural gas and other liquidsand gasses in industrial piping systems.They may carry these substances atelevated pressures and temperaturesand may be subject to the application ofexternal heat. Seamless carbon steelpressure pipe meeting the AmericanSociety for Testing and Materials(ASTM) standard A–106 may be used intemperatures of up to 1000 degreesFahrenheit, at various American Societyof Mechanical Engineers (ASME) codestress levels. Alloy pipes made to ASTMstandard A–335 must be used iftemperatures and stress levels exceedthose allowed for A–106 and the ASMEcodes. Seamless pressure pipes sold inthe United States are commonlyproduced to the ASTM A–106 standard.

Seamless standard pipes are mostcommonly produced to the ASTM A–53specification and generally are notintended for high temperature service.They are intended for the lowtemperature and pressure conveyance ofwater, steam, natural gas, air and otherliquids and gasses in plumbing andheating systems, air conditioning units,



automatic sprinkler systems, and otherrelated uses. Standard pipes (dependingon type and code) may carry liquids atelevated temperatures but must notexceed relevant ASME coderequirements.




The scope of this investigationincludes all multiple-stenciled seamlesspipe meeting the physical parametersdescribed above and produced to one ofthe specifications listed above, whetheror not also certified to a non-coveredspecification. Standard, line andpressure applications are definingcharacteristics of the scope of thisinvestigation. Therefore, seamless pipesmeeting the physical description above,but not produced to the A–106, A–53,or API 5L standards shall be covered ifused in an A–106, A–335, A–53 or API5L application.

For example, there are certain otherASTM specifications of pipe which,because of overlapping characteristics,could potentially be used in A–106applications. These specificationsinclude A–162, A–192, A–210, A–333,

and A–524. When such pipes are usedin a standard, line or pressure pipeapplication, such products are coveredby the scope of this investigation.





Regarding the end-use issue,interested parties have submittedarguments about whether end-useshould be maintained as a scopecriterion in this investigation. Aftercarefully considering these arguments,we have determined that, for purposesof this preliminary determination, wewill continue to include end-use as ascope criterion. We agree withpetitioner that pipe products identifiedas potential substitutes used in the sameapplications as products meeting therequisite ASTM specifications may fallwithin the same class or kind, andwithin the scope of any order issued inthis investigation. However, we are wellaware of the difficulties involved withrequiring end-use certifications,particularly the burdens placed on theDepartment, the U.S. Customs Service,and the parties. We will strive tosimplify any procedures used in thisregard. We will, therefore, carefullyconsider any comment on this issue forpurposes of our final determination.

Regarding the class or kind issue,although respondents propose dividingthe scope of this investigation into two

classes or kinds of merchandise, they donot agree on the merchandisecharacteristics that will define the twoclasses. The respondents in thisinvestigation and in the Germaninvestigation argue that the scopeshould be divided into two classes orkinds based on the material compositionof the pipe—carbon versus alloy. Therespondent in the Argentineinvestigation argues that the scopeshould be divided into two classes orkinds of merchandise based on size.Petitioner maintains that the subjectmerchandise constitutes a single class orkind.

We have considered the class or kindcomments of the interested parties andhave analyzed this issue based on thecriteria set forth by the Court ofInternational Trade in DiversifiedProducts v. United States, 6 CIT 155,572 F. Supp. 883 (1983). These criteriaare as follows: (1) the general physicalcharacteristics of the merchandise; (2)the ultimate use of the merchandise; (3)the expectations of the ultimatepurchasers; (4) the channels of trade;and (5) cost.

We note that certain differences existbetween the physical characteristics ofthe various products (e.g., size,composition). In addition, there appearto be cost differences between thevarious products. However, theinformation on record is not sufficientto justify dividing the class or kind ofmerchandise. The record on ultimateuse of the merchandise and theexpectations of the ultimate purchasersindicates that there is a strongpossibility that there may beoverlapping uses because any one of thevarious products in question may beused in different applications (e.g., lineand pressure pipe). Also, based uponthe evidence currently on the record, wedetermine that the similarities in thedistribution channels used for each ofthe proposed classes of merchandiseoutweigh any differences in thedistribution channels.

In conclusion, while we recognizethat certain differences exist betweenthe products in the proposed class orkind of merchandise, we find that thesimilarities are more significant.Therefore, for purposes of thispreliminary determination, we willcontinue to consider the scope ascovering one class or kind ofmerchandise. This preliminary decisionis consistent with past cases concerningsteel pipe products. (See e.g., FinalDetermination of Sales at Less Than FairValue: Circular Welded Non-Alloy SteelPipe From Brazil et. al., 57 FR 42940,September 17, 1992). However, anumber of issues with respect to class


or kind remain to be clarified. We willprovide the parties with anotheropportunity to submit additionalinformation and argument for the finaldetermination. For a completediscussion of the parties’ comments, aswell as the Department’s analysis, seememorandum from Gary Taverman,Acting Director, Office of AntidumpingInvestigations to Barbara Stafford,Deputy Assistant Secretary forInvestigations, dated January 19, 1995.




Period of InvestigationThe period of investigation (POI) is

January 1, 1994, through June 30, 1994.

Such or Similar ComparisonsWe have determined that all the

products covered by this investigationconstitute a single category of such orsimilar merchandise. We made fairvalue comparisons on this basis. In thiscase we only compared identicalmerchandise on the basis of the criteriadefined in Appendix V to theantidumping questionnaire, on file inRoom B–099 of the main building of theDepartment. Where there were no salesof identical merchandise in the homemarket to compare to U.S. sales, we didnot make sales comparisons for the

reasons outlined below in the ‘‘FairValue Comparisons’’ section of thisnotice.

Fair Value ComparisonsAlthough we found several areas in

MSA’s response where furtherclarification and/or information will berequired, we believe that much ofrespondent’s data is usable for purposesof the preliminary determination. SeeTeam Concurrence Memorandum datedJanuary 19, 1995. However, ourexamination of the differences inmerchandise (difmer) data provided inMSA’s December 9, 1994, supplementalresponse revealed inconsistencies thatmake it impracticable for us to use ournormal methodology forhyperinflationary economies.

Specifically, in its December 9, 1994,and January 4, 1995, submissions,respondent stated that it reportedmonthly replacement costs for homemarket products based on a productionmonth (which also happens to be boththe month of shipment and the monthof sale). Monthly replacement costs forU.S. products were reported based on aproduction month equal to the reportedmonth of shipment minus one month(which is not the month of sale).Although respondent’s replacementcosts were based on inflation-adjusted(UFIR) figures derived directly from itscost accounting system, respondentconverted these ‘‘indexed’’ costs intocurrent Brazilian currency (cruzeiros orreais, as appropriate) on the date ofshipment, thereby creating a problem ofcosts not being comparable over time.

Since the January 4, 1995,submission, we did not have sufficienttime for purposes of the preliminarydetermination to collect the necessaryinformation to perform the properindexation of these figures inaccordance with the methodologyoutlined in Department Policy BulletinNo. 94.5 dated March 25, 1994. Giventhe lack of usable difmer data, which webelieve can be rectified by issuing asecond supplemental questionnaire, wemade fair value comparisons only withrespect to identical merchandise andwithout regard to difmers.

To determine whether sales ofseamless pipe from MSA to the UnitedStates were made at less than fair value,we compared the United States price(USP) to the foreign market value(FMV), as specified in the ‘‘UnitedStates Price’’ and ‘‘Foreign MarketValue’’ sections of this notice.

In accordance with past practice, wedetermine Brazil’s economy to behyperinflationary. See FinalDetermination of Sales at Less Than FairValue: Ferrosilicon From Brazil, 59 FR

732, January 6, 1994 (Ferrosilicon).Pursuant to our methodologyconcerning such an economy, we madecontemporaneous sales comparisonsbased on the month of the U.S. sale. Inaccordance with 19 C.F.R. 353.58, wemade comparisons at the same level oftrade, where possible.

United States PriceWe based USP on purchase price (PP),

in accordance with section 772(b) of theAct, because the subject merchandisewas sold to unrelated purchasers in theUnited States before importation andbecause exporter’s sales pricemethodology was not otherwiseindicated.

We calculated PP based on packedCIF or duty paid, delivered prices tounrelated customers. In accordance withsection 772(d)(2)(A) of the Act, we madedeductions, where appropriate, forocean freight and insurance, U.S.brokerage, U.S. import duty and U.S.inland freight. Because respondentincorrectly reported U.S. shipment datebased on a date later than when themerchandise was shipped from thefactory, we revised U.S. shipment datesso that they appropriately reflect thedate the merchandise is shipped fromthe factory. We believe that it isreasonable to assume that theapproximate time difference betweenthe reported U.S. shipment date and thedate on which the merchandise left thefactory (i.e., upon production) is onemonth based respondent’s December 9,1994, and January 4, 1995, submissions.

We made an adjustment to USP forthe taxes paid on the comparison salesin Brazil. In this investigation, there arefour levels of taxes levied on sales of thesubject merchandise in the homemarket. The ICMS tax is a regional tax,which varies depending upon theBrazilian state in which the purchaseoriginates. The IPI, PIS and FINSOCIALtaxes are fixed percentage rate taxes.Because these taxes are calculated onthe same base price, we find them notto be cascading. Thus, for each sale, wemade only one tax adjustment whichequals the sum of the actual tax rates.(See Ferrosilicon, 59 FR at 733).

Foreign Market ValueIn order to determine whether there

were sufficient sales of seamless pipe inthe home market to serve as a viablebasis for calculating FMV, we comparedthe volume of home market sales ofseamless pipe to the volume of thirdcountry sales of seamless pipe inaccordance with section 773(a)(1)(B) ofthe Act. Based on this comparison, wefound that the volume of home marketsales was greater than five percent of the


aggregate volume of third country sales.Therefore, we determined that MSA hada viable home market with respect tosales of seamless pipe during the POI.

During the POI, MSA made homemarket sales to unrelated customers, aswell as to one related customer,Mannesmann Commerciale S.A.(MCSA). In its response, MSA providedtwo home market sales listings. Onesales listing consisted of MSA’s sales toMCSA and unrelated parties; the otherconsisted of MCSA’s sales to unrelatedparties including MCSA’s unrelatedcustomers (‘‘downstream’’ sales). MSAclaims that its related party sales weremade at arm’s-length. To test theaccuracy of respondent’s claim, wecompared related party prices tounrelated party prices using the test setforth in Appendix II to the FinalDetermination of Sales at Less Than FairValue: Certain Cold-Rolled Carbon SteelFlat Products from Argentina, 58 FR37062 (July 9, 1994), and found that itsprices to MCSA were not at arm’s-length. Therefore, we excluded MSA’srelated party sales from our analysis,and used only those sales made tounrelated parties including thedownstream sales.

In accordance with past practice, inorder to eliminate the distortive effectsof hyperinflation in the Brazilianeconomuy, we calculated separateweighted-average FMVs for each month.(See Ferrosilicon, 59 FR at 733).

In accordance with 19 C.F.R. 353.46,we calculated FMV based on FOB or CIFprices, exclusive of any inflationadjustment, charged to unrelatedcustomers in Brazil. In light of the Courtof Appeals for the Federal Circuit’s(CAFC) decision in Ad Hoc Committeeof AZ–NM–TX–FL Producers of GrayPortland Cement versus United States,13 F.3d 398 (Fed. Cir. 1994), theDepartment no longer can deduct homemarket movement charges from FMVpursuant to its inherent power to fill ingaps in the antidumping statute.Instead, we will adjust for thoseexpenses under the circumstance-of-saleprovision of 19 C.F.R. 353.56(a) and theexporter’s sales price offset provision of19 C.F.R. 353.56(b)(2), as appropriate.Accordingly, in the present case, wededucted post-sale home marketmovement charges from FMV under thecircumstance-of-sale provision of 19C.F.R. 353.56(a). This adjustmentincluded home market inland freightand insurance.

Pursuant to 19 C.F.R. 353.56(a)(2), wemade further circumstance-of-saleadjustments, where appropriate, fordifferences in credit expenses,warranties and product liabilityexpenses between the U.S. and home

markets. For certain transactions withreported negative values (e.g., warrantyexpenses), we made no adjustment toFMV for the subject expenses. Werecalculated U.S. credit expenses inaccordance with respondent’smethodology, using the revised U.S.shipment dates. (See ‘‘United StatesPrice’’ section of this notice.) For saleswith missing payment dates, werecalculated U.S. credit expenses usingthe date of the preliminarydetermination for date of payment. Forsales with missing shipment andpayment dates, we recalculated U.S.credit expenses using the averagenumber of credit days between therevised shipment dates and the reportedpayment dates for respondent’s U.S.sales which were reportedly shippedand paid. We disallowed MSA’s claimfor home market commissions made toa related party because respondent didnot demonstrate that these commissionswere arm’s-length transactions. (SeeLMI-La Metalli Industriale, S.p.A. versusUnited States, 912 F.2d 455 (Fed. Cir.1990)). We added interest revenue,where appropriate.

We also deducted home marketpacking and added U.S. packing costs,in accordance with section 773(a)(1) ofthe Act.

We adjusted for taxes collected in thehome market. See ‘‘United States Price’’section of this notice.

We did not make adjustments fordifferences in the physicalcharacteristics of the merchandise forthe reasons outlined above.

Currency ConversionNo certified rates of exchange, as

furnished by the Federal Reserve Bankof New York, were available for the POI.In place of the official certified rates, weused the daily official exchange rates forthe Brazilian currency published by theCentral Bank of Brazil which wereprovided by respondent in its Section Aresponse.

VerificationAs provided in section 776(b) of the

Act, we will verify the information usedin making our final determination.


of the Act, we are directing the CustomsService to suspend liquidation of allentries of seamless pipe from Brazil, asdefined in the ‘‘Scope of Investigation’’section of this notice, that are entered,or withdrawn from warehouse, forconsumption on or after the date ofpublication of this notice in the FederalRegister. The Customs Service shallrequire a cash deposit or the posting of

a bond equal to the estimatedpreliminary dumping margins, as shownbelow. The suspension of liquidationwill remain in effect until further notice.The estimated preliminary dumpingmargins are as follows:

Manufacturer/producer/exporter Marginpercent

Mannesmann S.A. ........................ 12.83All Others ...................................... 12.83

ITC Notification

In accordance with section 733(f) ofthe Act, we have notified the ITC of ourdetermination. If our finaldetermination is affirmative, the ITCwill determine whether imports of thesubject merchandise are materiallyinjuring, or threaten material injury to,the U.S. industry before the later of 120days after the date of the preliminarydetermination or 45 days after our finaldetermination.

Public Comment

In accordance with 19 C.F.R. 353.38,case briefs or other written comments inat least ten copies must be submitted tothe Assistant Secretary for ImportAdministration no later than March 10,1995, and rebuttal briefs no later thanMarch 15, 1995. In accordance with 19C.F.R. 353.38(b), we will hold a publichearing, if requested, to give interestedparties an opportunity to comment onarguments raised in case or rebuttalbriefs. Tentatively, the hearing will beheld on March 20, 1995 at 10:00 a.m. atthe U.S. Department of Commerce,Room 1414, 14th Street andConstitution Avenue, N.W.,Washington, D.C. 20230. Parties shouldconfirm by telephone the time, date, andplace of the hearing 48 hours before thescheduled time.

Interested parties who wish to requesta hearing must submit a written requestto the Assistant Secretary for ImportAdministration, U.S. Department ofCommerce, Room B–099, within tendays of the publication of this notice inthe Federal Register. Request shouldcontain: (1) The party’s name, address,and telephone number; (2) the numberof participants; and (3) a list of theissues to be discussed. In accordancewith 19 C.F.R. 353.38(b), oralpresentation will be limited to issuesraised in the briefs.

This determination is publishedpursuant to section 733(f) of the Act (19U.S.C. 1673b(f)) and 19 C.F.R.353.15(a)(4).



[A–428–820]

Notice of Preliminary Determination ofSales at Less Than Fair Value: SmallDiameter Circular Seamless Carbonand Alloy Steel, Standard, Line andPressure Pipe From Germany

AGENCY: Import Administration,International Trade Administration,Department of Commerce.EFFECTIVE DATE: January 27, 1995.FOR FURTHER INFORMATION CONTACT: KateJohnson or Irene Darzenta, Office ofAntidumping Investigations, ImportAdministration, U.S. Department ofCommerce, 14th Street and ConstitutionAvenue, N.W., Washington, D.C. 20230;telephone (202) 482–4929 or 482–6320,respectively.PRELIMINARY DETERMINATION: TheDepartment of Commerce (theDepartment) preliminarily determinesthat small diameter circular seamlesscarbon and alloy steel, standard, lineand pressure pipe from Germany(seamless pipe) is being, or is likely tobe, sold in the United States at less thanfair value, as provided in section 733 ofthe Tariff Act of 1930, as amended (theAct). The estimated margins are shownin the ‘‘Suspension of Liquidation’’section of this notice.

Case History

Since the notice of initiationpublished on July 20, 1994, (59 FR37025), the following events haveoccurred.


On August 19, 1994, we namedMannesmannrohren-Werke AG (MRW)as the sole respondent in thisinvestigation, and on the same dateissued an antidumping questionnaire tothis company. MRW accounted for atleast 60 percent of the exports of thesubject merchandise to the UnitedStates during the POI. Although itrequested that it be allowed to respondvoluntarily to the Department’squestionnaire, on October 5, 1994, weinformed Benteler A.G., another Germanproducer, that we would not beaccepting voluntary responses in thisinvestigation due to administrativeresource constraints.

On September 12, 1994, MRWsubmitted a response to Section A of theDepartment’s questionnaire. Sections Band C were submitted on October 14,1994. On October 11 and November 2,1994, we received petitioner’scomments regarding MRW’squestionnaire responses. We issued asupplemental questionnaire onNovember 18, 1994. MRW submitted itssupplemental response on December 9,1994.

On October 21, 1994, we receivedcomments on the issues of scope andclass or kind of merchandise frominterested parties, in response to theDepartment’s invitation for suchcomments in its notice of initiation. OnOctober 31 and November 17, 1994, wereceived rebuttal comments on thisissue.

On October 27, 1994, the Departmentreceived a request from petitioner topostpone the preliminary determinationuntil January 19, 1995. On November18, 1994, we published in the FederalRegister (59 FR 59748), a noticeannouncing the postponement of thepreliminary determination until notlater than January 19, 1995, inaccordance with 19 C.F.R. 353.15(c) and(d).





Specifications, Characteristics andUses: Seamless pressure pipes areintended for the conveyance of water,steam, petrochemicals, chemicals, oil

products, natural gas and other liquidsand gasses in industrial piping systems.They may carry these substances atelevated pressures and temperaturesand may be subject to the application ofexternal heat. Seamless carbon steelpressure pipe meeting the AmericanSociety for Testing and Materials(ASTM) standard A–106 may be used intemperatures of up to 1000 degreesfahrenheit, at various American Societyof Mechanical Engineers (ASME) codestress levels. Alloy pipes made to ASTMstandard A–335 must be used iftemperatures and stress levels exceedthose allowed for A–106 and the ASMEcodes. Seamless pressure pipes sold inthe United States are commonlyproduced to the ASTM A–106 standard.




The primary application of ASTM A–106 pressure pipes and triple certifiedpipes is in pressure piping systems byrefineries, petrochemical plants andchemical plants. Other applications arein power generation plants (electrical-fossil fuel or nuclear), and in some oilfield uses (on shore and off shore) suchas for separator lines, gathering linesand metering runs. A minor application



of this product is for use as oil and gasdistribution lines for commercialapplications. These applicationsconstitute the majority of the market forthe subject seamless pipes. However, A–106 pipes may be used in some boilerapplications.

The scope of this investigationincludes all multiple-stenciled seamlesspipe meeting the physical parametersdescribed above and produced to one ofthe specifications listed above, whetheror not also certified to a non-coveredspecification. Standard, line andpressure applications are definingcharacteristics of the scope of thisinvestigation. Therefore, seamless pipesmeeting the physical description above,but not produced to the A–106, A–53,or API 5L standards shall be covered ifused in an A–106, A–335, A–53, or API5L application.




Scope Issues

In our notice of initiation weidentified two issues which weintended to consider further. The firstissue was whether to consider end-usea factor in defining the scope of theseinvestigations.1 The second issue waswhether the seamless pipe subject tothis investigation constitutes more thanone class or kind of merchandise. Inaddition to these two issues, interestedparties have raised a number of otherissues regarding whether certainproducts should be excluded from thescope of this investigation. These issuesare discussed below.

Regarding the end-use issue,interested parties have submittedarguments about whether end-useshould be maintained as a scopecriterion in this investigation. Aftercarefully considering these arguments,we have determined that, for purposesof this preliminary determination, wewill continue to include end-use as ascope criterion. We agree withpetitioner that pipe products identifiedas potential substitutes used in the sameapplications as products meeting therequisite ASTM specifications may fallwithin the same class or kind, andwithin the scope of any order issued inthis investigation. However, we are wellaware of the difficulties involved withrequiring end-use certifications,particularly the burdens placed on theDepartment, the U.S. Customs Service,and the parties. We will strive tosimplify any procedures used in thisregard. We will, therefore, carefullyconsider any comment on this issue forpurposes of our final determination.

Regarding the class or kind issue,although respondents propose dividingthe scope of this investigation into twoclasses or kinds of merchandise, they donot agree on the merchandisecharacteristics that will define the twoclasses. The respondents in thisinvestigation as well as the Brazilianinvestigation argue that the scopeshould be divided into two classes orkinds based on the material compositionof the pipe—carbon versus alloy. Therespondent in the Argentineinvestigation argues that the scopeshould be divided into two classes orkinds of merchandise based on size.Petitioner maintains that the subjectmerchandise constitutes a single class orkind.

We have considered the class or kindcomments of the interested parties andhave analyzed this issue based on thecriteria set forth by the Court ofInternational Trade in DiversifiedProducts v. United States, 6 CIT 155,572 F. Supp. 883 (1983). These criteriaare as follows: (1) the general physicalcharacteristics of the merchandise; (2)the ultimate use of the merchandise; (3)the expectations of the ultimatepurchasers; (4) the channels of trade;and (5) cost.

We note that certain differences existbetween the physical characteristics ofthe various products (e.g., size,composition). In addition, there appearto be cost differences between thevarious products. However, theinformation on record is not sufficientto justify dividing the class or kind ofmerchandise. The record on ultimateuse of the merchandise and theexpectations of the ultimate purchasers

indicates that there is a strongpossibility that there may beoverlapping uses because any one of thevarious products in question may beused in different applications (e.g., lineand pressure pipe). Also, based uponthe evidence currently on the record, wedetermine that the similarities in thedistribution channels used for each ofthe proposed classes of merchandiseoutweigh any differences in thedistribution channels.

In conclusion, while we recognizethat certain differences exist betweenthe products in the proposed class orkind of merchandise, we find that thesimilarities are more significant.Therefore, for purposes of thispreliminary determination, we willcontinue to consider the scope ascovering one class or kind ofmerchandise. This preliminary decisionis consistent with past cases concerningsteel pipe products. (See e.g., FinalDetermination of Sales at Less Than FairValue: Circular Welded Non-Alloy SteelPipe From Brazil et al., 57 FR 42940,September 17, 1992). However, anumber of issues with respect to classor kind remain to be clarified. We willprovide the parties with anotheropportunity to submit additionalinformation and argument for the finaldetermination. For a completediscussion of the parties’ comments, aswell as the Department’s analysis, seememorandum from Gary Taverman,Acting Director, Office of AntidumpingInvestigations to Barbara Stafford,Deputy Assistant Secretary forInvestigations, dated January 19, 1995.



Because we currently haveinsufficient evidence to make a


determination regarding these requests,we are not yet in a position to addressthese concerns. Therefore, for purposesof this preliminary determination, wewill not exclude these products from thescope of this investigation. Once again,we will collect additional informationand consider additional argument beforethe final determination.

Period of InvestigationThe period of investigation (POI) is

January 1, 1994, to June 30, 1994.


products covered by this investigationconstitute a single category of such orsimilar merchandise. We made fairvalue comparisons on this basis. Inaccordance with the Department’sstandard methodology, we firstcompared identical merchandise. Wherethere were no sales of identicalmerchandise in the home market tocompare to U.S. sales, we made similarmerchandise comparisons on the basisof the criteria defined in Appendix V tothe antidumping questionnaire, on filein Room B–099 of the main building ofthe Department.

Fair Value ComparisonsTo determine whether sales of

seamless pipe from MRW to the UnitedStates were made at less than fair value,we compared the United States price(USP) to the foreign market value(FMV), as specified in the ‘‘UnitedStates Price’’ and ‘‘Foreign MarketValue’’ sections of this notice. Inaccordance with 19 C.F.R. 353.58, wemade comparisons at the same level oftrade, where possible.



We calculated PP based on packedprices to unrelated customers. Inaccordance with section 772(d)(2)(A) ofthe Act, we made deductions, whereappropriate, foreign inland freight,inland insurance, ocean freight, U.S.brokerage, U.S. duty, wharfage, and U.S.inland freight. In the one instance whereforeign inland freight had a missingvalue, we assigned the average foreigninland freight amount for all otherreported transactions to the missingvalue. We also made an adjustment toUSP for the value-added tax (VAT) paidon the comparison sales in Germany in

accordance with our practice, pursuantto the Court of International Trade’s(CIT) decision in Federal-Mogul Corp.and The Torrington Co. v. United States,Slip Op. 93–194 (CIT October 7, 1993).(See Final Determination of Sales atLess Than Fair Value: CalciumAluminate Cement, Cement Clinker andFlux from France, 59 FR 14136, March25, 1994). We recalculated VAT becauserespondent’s calculation includeddiscounts.

Foreign Market Value

In order to determine whether therewere sufficient sales of seamless pipe inthe home market to serve as a viablebasis for calculating FMV, we comparedthe volume of home market sales ofseamless pipe to the volume of thirdcountry sales of seamless pipe inaccordance with section 773(a)(1)(B) ofthe Act. Based on this comparison, wedetermined that MRW had a viablehome market with respect to sales ofseamless pipe during the POI.

In accordance with 19 C.F.R. 353.46,we calculated FMV based on pricescharged to both related (whenappropriate) and unrelated customers inGermany. We compared related partyprices to unrelated party prices usingthe test set forth in Appendix II to theFinal Determination of Sales at LessThan Fair Value: Certain Cold-RolledCarbon Steel Flat Products fromArgentina, 58 FR 37062 (July 9, 1994)and used in our FMV calculation thosesales made to related parties that wereat arm’s length. We made deductions,where appropriate, for discounts andrebates. In instances where the reportedquantity for certain sales was zero, weexcluded these transactions from ouranalysis. In one instance where thereported rebate expense was negative,we set this expense for the particulartransaction to zero.

In light of the Court of Appeals for theFederal Circuit’s (CAFC) decision in AdHoc Committee of AZ–NM–TX–FLProducers of Gray Portland Cement v.United States, 13 F.3d 398 (Fed. Cir.1994), the Department no longer candeduct home market movement chargesfrom FMV pursuant to its inherentpower to fill in gaps in the antidumpingstatute. Instead, we will adjust for thoseexpenses under the circumstance-of-saleprovision of 19 C.F.R. 353.56(a) and theexporter’s sales price offset provision of19 C.F.R. 353.56(b)(2), as appropriate.Accordingly, in the present case, wededucted post-sale home marketmovement charges from FMV under thecircumstance-of-sale provision of 19C.F.R. 353.56(a). This adjustmentincluded foreign inland freight.

Pursuant to 19 C.F.R. 353.56(a)(2), wemade further circumstance-of-saleadjustments, where appropriate, fordifferences in credit expenses,warranties and inspection expensesbetween the U.S. and home markets.With regard to credit expenses in thehome market, given that respondentonly provided month and year forshipment and payment dates, we setshipment date equal to the first day ofthe reported month and payment dateequal to the last day of the reportedmonth and then calculated imputedcredit in accordance with our normalmethodology. For both markets, wecalculated an average number of creditdays when shipment and payment dateswere missing and used the date of thepreliminary determination, January 19,1995, as payment date when onlypayment dates were missing. Wededucted home market commissionsand added U.S. indirect sellingexpenses capped by the amount of homemarket commissions.

We also deducted home marketpacking and added U.S. packing costs,in accordance with section 773(a)(1) ofthe Act. We made adjustments, whereappropriate, for differences in thephysical characteristics of themerchandise, in accordance withsection 773(a)(4)(C) of the Act.

We adjusted for VAT in accordancewith our practice. (See the ‘‘UnitedStates Price’’ section of this notice,above.)

Currency ConversionWe made currency conversions based

on the official exchange rates in effecton the dates of the U.S. sales as certifiedby the Federal Reserve Bank of NewYork. See 19 C.F.R. 353.60(a).

VerificationAs provided in section 776(b) of the

Act, we will verify the information usedin making our final determination.


of the Act, we are directing the CustomsService to suspend liquidation of allentries of seamless pipe from Germany,as defined in the Scope of Investigationsection of this notice, that are entered,or withdrawn from warehouse, forconsumption on or after the date ofpublication of this notice in the FederalRegister. The Customs Service shallrequire a cash deposit or the posting ofa bond equal to the estimatedpreliminary dumping margins, as shownbelow. The suspension of liquidationwill remain in effect until further notice.The estimated preliminary dumpingmargins are as follows:


Manufacturer/producer/exporter Marginpercent

Mannesmannrohren-Werke AG .... 2.68%All others ....................................... 2.68%

ITC Notification


Public Comment

In accordance with 19 C.F.R. 353.38,case briefs or other written comments inat least ten copies must be submitted tothe Assistant Secretary for ImportAdministration no later than March 10,1995, and rebuttal briefs no later thanMarch 15, 1995. In accordance with 19C.F.R. 353.38(b), we will hold a publichearing, if requested, to give interestedparties an opportunity to comment onarguments raised in case or rebuttalbriefs. Tentatively, the hearing will beheld on March 17, 1995, at 2:00 p.m. atthe U.S. Department of Commerce,Room 1414, 14th Street andConstitution Avenue, N.W.,Washington, D.C. 20230. Parties shouldconfirm by telephone the time, date, andplace of the hearing 48 hours before thescheduled time.

Interested parties who wish to requesta hearing must submit a written requestto the Assistant Secretary for ImportAdministration, U.S. Department ofCommerce, Room B–099, within tendays of the publication of this notice inthe Federal Register. Request shouldcontain: (1) the party’s name, address,and telephone number; (2) the numberof participants; and (3) a list of theissues to be discussed. In accordancewith 19 C.F.R. 353.38(b), oralpresentation will be limited to issuesraised in the briefs.



Susan G. Esserman,Assistant Secretary for ImportAdministration.[FR Doc. 95–2105 Filed 1–26–95; 8:45 am]

BILLING CODE 3510–DS–P

[A–475–814]

Notice of Preliminary Determination ofSales at Not Less Than Fair Value:Small Diameter Circular SeamlessCarbon and Alloy Steel, Standard, Lineand Pressure Pipe from Italy

AGENCY: Import Administration,International Trade Administration,Department of CommerceEFFECTIVE DATE: January 27, 1995.FOR FURTHER INFORMATION CONTACT:Mary Jenkins or Kate Johnson, Office ofAntidumping Investigations, ImportAdministration, U.S. Department ofCommerce, 14th Street and ConstitutionAvenue, N.W., Washington, D.C. 20230;telephone (202) 482–1756 or 482–4929,respectively.PRELIMINARY DETERMINATION: TheDepartment of Commerce (theDepartment) preliminarily determinesthat small diameter circular seamlesscarbon and alloy steel, standard, lineand pressure pipe from Italy (seamlesspipe) is not being, nor is likely to be,sold in the United States at less than fairvalue, as provided in section 733 of theTariff Act of 1930, as amended (the Act).The estimated de minimis margins areshown in the ‘‘Preliminary Margin’’section of this notice.

Case HistorySince the notice of initiation

published on July 20, 1994, (59 FR37025), the following events haveoccurred.


On August 19, 1994, we sent theantidumping questionnaire to DalmineS.p.A., TAD USA, Inc., and DalmineUSA, Inc., (collectively ‘‘Dalmine’’),because petitioner claimed that Dalminewas the sole producer of the subjectmerchandise exported to the UnitedStates from Italy during the period ofinvestigation (POI). In order todetermine if Dalmine accounted for over60 percent of the exports to the UnitedStates and, accordingly, could be namedas the sole respondent, we also sent anabbreviated version of Section A of thequestionnaires to the following Italianproducers named in the petition:Acciaierie e Tubificio Meridionali SpA,Pietra SpA-Acciaierie Ferriere e Tubifici(Pietra SpA), Tubicar SpA, SandvikItalia SpA, and Seta Tubi Srl. OnSeptember 2 and 23, 1994, Dalmineprovided volume and value data of salesof subject merchandise during the POI.Acciaierie e Tubificio Meridionali,Sandvik Italia and Tubicar SpA

informed the Department that they didnot sell subject merchandise to theUnited States during the POI. Seta TubiSrl’s antidumping questionnaire wasreturned to the Department by the postalservice as undeliverable because theaddress could not be found. We did notreceive a response from Pietra SpA.However, Pietra SpA sent a facsimile tothe U.S. Consulate in Milan in which itreported a small volume of shipments ofthe subject merchandise to the UnitedStates from January 1 to March 31, 1994.On September 27, 1994, we determinedthat Dalmine S.p.A. (Dalmine) should bethe sole respondent in this investigationbecause it accounted for at least 60percent of the exports of the subjectmerchandise to the United States duringthe POI.

On September 19, 1994, we receiveda request from Dalmine to excludecertain ‘‘outlier’’ sales from its UnitedStates and home market sales listings.On September 23, 1994, petitionersubmitted its opposition to Dalmine’srequest. On September 26, 1994,Dalmine responded to petitioner’sSeptember 23, 1994, objections. Werequested additional information fromDalmine concerning the ‘‘outlier’’ saleson September 30, 1994. Based onDalmine’s request, and after consideringall comments received, on November28, 1994, we informed Dalmine that itwould be exempted from reportingcertain ‘‘outlier’’ home market and U.S.sales.

On December 6 and 19, 1994, Dalminerequested that it be exempt fromreporting an insignificant quantity ofsales made by related resellers andsought clarification concerning which ofits customers are ‘‘related parties.’’ OnDecember 12 and 22, 1994, we receivedcomments from petitioner addressingDalmine’s request to exclude reportingcertain related party sales. On January19, 1995, after considering theadditional request and consideringcomments, we also granted Dalmine anexemption from reporting aninsignificant quantity of home marketsales made by related resellers. TheDepartment accepted Dalmine’sdefinition of related party, as describedits B and C responses. Therefore, it wasnot necessary to provide additionalguidance.

On September 23, 1994, we receivedDalmine’s response to Section A of theDepartment’s questionnaire. Responsesto Sections B and C of the questionnairewere submitted on October 7, 1994. OnOctober 11, 1994, petitioner commentedon Dalmine’s Section A questionnaireresponse. On October 11 and 31, 1994,we received additional comments frompetitioner regarding Dalmine’s Sections



A, B and C responses. On November 18,we issued a supplemental questionnaireto Dalmine. We received a response onDecember 19, 1994.

On October 21 and 31, and November17, 1994, we received comments andrebuttal comments on the issues ofscope and class or kind of merchandisefrom interested parties, pursuant to theDepartment’s invitation for suchcomments in its notice of initiation.

On October 27, 1994, the Departmentreceived a request from petitioner topostpone the preliminary determinationuntil January 19, 1995. On November18, 1994, we published in the FederalRegister (59 FR 59748), a noticeannouncing the postponement of thepreliminary determination until notlater than January 19, 1995, inaccordance with 19 C.F.R. 353.15(c) and(d).





Specifications, Characteristics andUses: Seamless pressure pipes areintended for the conveyance of water,steam, petrochemicals, chemicals, oilproducts, natural gas and other liquidsand gasses in industrial piping systems.They may carry these substances atelevated pressures and temperaturesand may be subject to the application ofexternal heat. Seamless carbon steelpressure pipe meeting the AmericanSociety for Testing and Materials(ASTM) standard A–106 may be used intemperatures of up to 1000 degrees

fahrenheit, at various American Societyof Mechanical Engineers (ASME) codestress levels. Alloy pipes made to ASTMstandard A–335 must be used iftemperatures and stress levels exceedthose allowed for A–106 and the ASMEcodes. Seamless pressure pipes sold inthe United States are commonlyproduced to the ASTM A–106 standard.





The scope of this investigationincludes all multiple-stenciled seamlesspipe meeting the physical parameters

described above and produced to one ofthe specifications listed above, whetheror not also certified to a non-coveredspecification. Standard, line andpressure applications are definingcharacteristics of the scope of thisinvestigation. Therefore, seamless pipesmeeting the physical description above,but not produced to the A–106, A–53,or API 5L standards shall be covered ifused in an A–106, A–335, A–53, or API5L application.






Regarding the end-use issue,interested parties have submittedarguments about whether end-useshould be maintained as a scopecriterion in this investigation. Aftercarefully considering these arguments,we have determined that, for purposesof this preliminary determination, wewill continue to include end-use as ascope criterion. We agree withpetitioner that pipe products identified


as potential substitutes used in the sameapplications as products meeting therequisite ASTM specifications may fallwithin the same class or kind, andwithin the scope of any order issued inthis investigation. However, we are wellaware of the difficulties involved withrequiring end-use certifications,particularly the burdens placed on theDepartment, the U.S. Customs Service,and the parties. We will strive tosimplify any procedures used in thisregard. We will, therefore, carefullyconsider any comment on this issue forpurposes of our final determination.

Regarding the class or kind issue,although respondents propose dividingthe scope of this investigation into twoclasses or kinds of merchandise, they donot agree on the merchandisecharacteristics that will define the twoclasses. The respondents in theBrazilian and German investigationsargue that the scope should be dividedinto two classes or kinds based on thematerial composition of the pipe—carbon versus alloy. The respondent inthe Argentine investigation argues thatthe scope should be divided into twoclasses or kinds of merchandise basedon size. Petitioner maintains that thesubject merchandise constitutes a singleclass or kind.

We have considered the class or kindcomments of the interested parties andhave analyzed this issue based on thecriteria set forth by the Court ofInternational Trade in DiversifiedProducts v. United States, 6 CIT 155,572 F. Supp. 883 (1983). These criteriaare as follows: (1) The general physicalcharacteristics of the merchandise; (2)the ultimate use of the merchandise; (3)the expectations of the ultimatepurchasers; (4) the channels of trade;and (5) cost.

We note that certain differences existbetween the physical characteristics ofthe various products (e.g., size,composition). In addition, there appearto be cost differences between thevarious products. However, theinformation on record is not sufficientto justify dividing the class or kind ofmerchandise. The record on ultimateuse of the merchandise and theexpectations of the ultimate purchasersindicates that there is a strongpossibility that there may beoverlapping uses because any one of thevarious products in question may beused in different applications (e.g., lineand pressure pipe). Also, based uponthe evidence currently on the record, wedetermine that the similarities in thedistribution channels used for each ofthe proposed classes of merchandiseoutweigh any differences in thedistribution channels.

In conclusion, while we recognizethat certain differences exist betweenthe products in the proposed class orkind of merchandise, we find that thesimilarities are more significant.Therefore, for purposes of thispreliminary determination, we willcontinue to consider the scope ascovering one class or kind ofmerchandise. This preliminary decisionis consistent with past cases concerningsteel pipe products. (See e.g., FinalDetermination of Sales at Less Than FairValue: Circular Welded Non-Alloy SteelPipe From Brazil et. al., 57 FR 42940,September 17, 1992). However, anumber of issues with respect to classor kind remain to be clarified. We willprovide the parties with anotheropportunity to submit additionalinformation and argument for the finaldetermination. For a completediscussion of the parties’ comments, aswell as the Department’s analysis, seememorandum from Gary Taverman,Acting Director, Office of AntidumpingInvestigations to Barbara Stafford,Deputy Assistant Secretary forInvestigations, dated January 19, 1995.




Period of InvestigationThe POI is January 1, 1994, through

June 30, 1994.


products covered by this investigationconstitute a single category of such orsimilar merchandise. We made fairvalue comparisons on this basis. Inaccordance with the Department’sstandard methodology, we firstcompared identical merchandise.Referencing Appendix V of ourquestionnaire, Dalmine states that thespecifications for the merchandiseexported to the United States areidentical to the specifications for themerchandise sold in the home market.Dalmine further claims that triple-stencilled merchandise sold in the U.S.market is identical to single-stencilledmerchandise sold in the home market.We have accepted Dalmine’s assertionsfor purposes of this preliminarydetermination. Where there were nosales of identical merchandise in thehome market to compare to U.S. sales,or where, according to respondent,comparisons of similar merchandisewould result in differences-in-merchandise adjustments exceeding 20percent, we made comparisons on thebasis of constructed value (CV) becausethere was no comparable merchandisesold in the home market based on thecriteria in Appendix V to theantidumping questionnaire, on file inRoom B–099 of the main building of theDepartment.

Fair Value ComparisonsTo determine whether sales of

seamless pipe from Dalmine to theUnited States were made at less thanfair value, we compared the UnitedStates price (USP) to the foreign marketvalue (FMV), as specified in the ‘‘UnitedStates Price’’ and ‘‘Foreign MarketValue’’ sections of this notice. Inaccordance with 19 C.F.R. 353.58, wemade comparisons at the same level oftrade, where possible.



We calculated PP based on packedFOB U.S. port prices to unrelatedcustomers. In accordance with section772(d)(2)(A) of the Act, we madedeductions, where appropriate, forforeign inland freight, ocean freight,


U.S. brokerage, marine insurance, andU.S. import duty.

We also made an adjustment to USPfor the value-added tax (VAT) paid onthe comparison sales in Italy inaccordance with our practice, pursuantto the Court of International Trade’s(CIT) decision in Federal-Mogul Corp.and the Torrington Co. v. United States,Slip Op. 93–194 (CIT) October 7, 1993).(See Final Determination of Sales at lessThan Fair Value: Calcium AluminateCement, Cement Clinker and Flux fromFrance, 59 FR 14136, March 25, 1994).

Foreign Market Value

In order to determine whether therewere sufficient sales of subjectmerchandise in the home market toserve as a viable basis for calculatingFMV, we compared the volume of homemarket sales of seamless pipe to thevolume of third country sales ofseamless pipe in accordance withsection 773(a)(1)(B) of the Act. Based onthis comparison, we found that thevolume of home market sales wasgreater than five percent of the aggregatevolume of third country sales.Therefore, we determined that Dalminehad a viable home market with respectto sales of seamless pipe during the POI.

In accordance with 19 C.F.R. 353.46,we calculated FMV based on ex-factoryor delivered prices charged to unrelatedand, where appropriate, to relatedcustomers in Italy. We compared relatedparty prices using the test set forth inAppendix II to the Final Determinationof Sales at Less than Fair Value; CertainCold-rolled Carbon Steel Flat Productsfrom Argentina, 58 FR 37062 (July 9,1994), and used in our FMV calculationthose sales made to related parties thatwere at arm’s-length. We madedeductions, where appropriate, fordiscounts.

In light of the Court of Appeals for theFederal Circuit’s (CAFC) decision in AdHoc Committee of AZ–NM–TX–FLProducers of Gray Portland Cement v.United States, 13 F.3d 398 (Fed. Cir.1994), the Department no longer candeduct home market movement chargesfrom FMV pursuant to its inherentpower to fill in gaps in the antidumpingstatute. Instead, we will adjust for thoseexpenses under the circumstance-of-saleprovision of 19 C.F.R. 353.56(a) and theexporter’s sales price offset provision of19 C.F.R. 353.56(b)(2), as appropriate.Accordingly, in the present case, wededucted post-sale home marketmovement charges from FMV under thecircumstance-of-sale provision of 19C.F.R. 353.56(a). This adjustmentincluded home market foreign inlandfreight.

Pursuant to 19 C.F.R. 353.56(a)(2), wemade further circumstance-of-saleadjustments, where appropriate, fordifferences in credit expenses,warranties and product liabilityexpenses between the U.S. and homemarket. For home market sales withmissing shipment and payment dates,we recalculated credit expenses usingan average number of credit days. Forthose sales missing only payment dates,we recalculated credit expenses usingthe date of our preliminarydetermination. We deducted homemarket commissions and added U.S.indirect selling expenses capped by theamount of home market commissions.We added interest revenue, whereappropriate.

We also deducted home marketpacking and added U.S. packing costs,in accordance with section 773(a)(1) ofthe Act.

We adjusted for VAT in accordancewith our practice. (See, the ‘‘UnitedStates Price’’ section of this notice,above.)

For sales for which Dalmine had withno comparable merchandise sold in thehome market for comparison to its U.S.product, we based FMV on CV. Wecalculated CV based on the sum of thecost of materials, fabrication, generalexpenses, U.S. packing costs and profit.In accordance with section773(e)(1)(B)(i) of the Act, we includedthe greater of respondent’s reportedgeneral expenses or the statutoryminimum of ten percent of the cost ofmanufacturing (COM), as appropriate.For profit, we used the statutoryminimum of eight percent of the sum ofCOM and general expenses. We madecircumstance-of-sale adjustments, whereappropriate, for differences in creditexpenses and product liability andwarranty, pursuant to 19 C.F.R.353.56(a)(2).

Currency Conversion

We made currency conversions basedon the official exchange rates in effecton the dates of the U.S. sales as certifiedby the Federal Reserve Bank of NewYork. See 19 C.F.R. 353.60(a).

Verification

As provided in section 776(b) of theAct, we will verify the information usedin making our final determination.

PRELIMINARY MARGINS

Manufacturer/producerexporter Margin percent

Dalmine S.p.A. ................ 0.28 de minimis.All others ......................... 0.28 de minimis.

ITC Notification


Public Comment

In accordance with 19 C.F.R. 353.38,case briefs or other written comments inat least ten copies must be submitted tothe Assistant Secretary for ImportAdministration no later than March 10,1995, and rebuttal briefs no later thanMarch 15, 1995. In accordance with 19C.F.R. 353.38(b), we will hold a publichearing, if requested, to give interestedparties an opportunity to comment onarguments raised in case or rebuttalbriefs. Tentatively, the hearing will beheld on March 20, 1995, at 2:00 p.m., atthe U.S. Department of Commerce,Room 1414, 14th Street andConstitution Avenue, N.W.,Washington, D.C. 20230. Parties shouldconfirm by telephone the time, date, andplace of the hearing 48 hours before thescheduled time.

Interested parties who wish to requesta hearing must submit a written requestto the Assistant Secretary for ImportAdministration, U.S. Department ofCommerce, Room B–099, within tendays of the publication of this notice inthe Federal Register. Request shouldcontain: (1) The party’s name, address,and telephone number; (2) the numberof participants; and (3) a list of theissues to be discussed. In accordancewith 19 C.F.R. 353.38(b), oralpresentation will be limited to issuesraised in the briefs.



U.S. Automotive Parts AdvisoryCommittee; Closed Meeting

AGENCY: International TradeAdministration, Commerce.ACTION: Closed meeting of U.S.Automotive Parts Advisory Committee.


SUMMARY: The U.S. Automotive PartsAdvisory Committee (the ‘‘Committee’’)advises U.S. Government officials onmatters relating to the implementationof the Fair Trade in Auto Parts Act of1988. The Committee: (1) Reportsannually to the Secretary of Commerceon barriers to sales of U.S.-made autoparts and accessories in Japanesemarkets; (2) assists the Secretary inreporting to the Congress on theprogress of sales of U.S.-made auto partsin Japanese markets, including theformation of long-term supplierrelationships; (3) reviews and considersdata collected on sales of U.S.-madeauto parts to Japanese markets; (4)advises the Secretary duringconsultations with the Government ofJapan on these issues; and (5) assists inestablishing priorities for theDepartment’s initiatives to increaseU.S.-made auto parts sales to Japanesemarkets, and otherwise provideassistance and direction to the Secretaryin carrying out these initiatives. At themeeting, committee members willreceive briefings on the status ofongoing consultations with theGovernment of Japan and will discussspecific trade and sales expansionprograms related to U.S.-Japanautomotive parts policy.

DATE AND LOCATION: The meeting will beheld on Thursday, February 9, 1995from 11:00 a.m. to 2:30 p.m. at the U.S.Department of Commerce inWashington, D.C.

FOR FURTHER INFORMATION CONTACT: Dr.Robert Reck, Office of AutomotiveAffairs, Trade Development, MainCommerce, Room 4036, Washington,D.C. 20230, telephone: (202) 482–1418.

SUPPLEMENTARY INFORMATION: TheAssistant Secretary for Administration,with the concurrence of the GeneralCounsel formally determined on July 5,1994, pursuant to Section 10(d) of theFederal Advisory Act, as amended, thatthe series of meetings or portions ofmeetings of the Committee and of anysubcommittee thereof, dealing withprivileged or confidential commercialinformation may be exempt from theprovisions of the Act relating to openmeeting and public participation thereinbecause these items are concerned withmatters that are within the purview of5 U.S.C. 552b(c)(4) and (9)(B). A copy ofthe Notice of Determination is availablefor public inspection and copying in theDepartment of Commerce RecordsInspection Facility, Room 6020, MainCommerce.

Dated: January 23, 1995.Henry P. Misisco,Director, Office of Automotive Affairs.[FR Doc. 95–2125 Filed 1–26–95; 8:45 am]BILLING CODE 3510–DR–P

National Institute of Standards andTechnology

[Docket No. 940541–4339]

RIN 0693–AB30

Approval of Federal InformationProcessing Standards Publication153–1, Programmer’s HierarchicalInteractive Graphics System (PHIGS)

AGENCY: National Institute of Standardsand Technology (NIST), Commerce.ACTION: The purpose of this notice is toannounce that the Secretary ofCommerce has approved a revisedstandard, which will be published asFIPS Publication 153–1, Programmer’sHierarchical Interactive GraphicsSystem (PHIGS).

SUMMARY: On June 17, 1994 (59 FR31209–31214), notice was published inthe Federal Register that a revision toFederal Information ProcessingStandard 153, Programmer’sHierarchical Interactive GraphicsSystem (PHIGS) was being proposed forFederal use.

The written comments submitted byinterested parties and other materialavailable to the Department relevant tothe revised standard was reviewed byNIST. On the basis of this review, NISTrecommended that the Secretaryapprove the revised standard as aFederal Information ProcessingStandards Publication, and prepared adetailed justification document for theSecretary’s review in support of thatrecommendation.

The detailed justification documentwhich was presented to the Secretary ispart of the public record and is availablefor inspection and copying in theDepartment’s Central Reference andRecords Inspection Facility, Room 6020,Herbert C. Hoover Building, 14th Streetbetween Pennsylvania and ConstitutionAvenues, NW, Washington, DC 20230.

This FIPS contains two sections: (1)An announcement section, whichprovides information concerning theapplicability, implementation, andmaintenance of the standard; and (2) aspecifications section which deals withthe technical requirements of thestandard. Only the announcementsection of the standard is provided inthis notice.EFFECTIVE DATE: This revised standardbecomes effective August 1, 1995.

ADDRESSES: Interested parties maypurchase copies of this revisedstandard, including the technicalspecifications section, from the NationalTechnical Information Service (NTIS).Specific ordering information fromNTIS for this standard is set out in theWhere to Obtain Copies Section of theannouncement section of the standard.FOR FURTHER INFORMATION CONTACT:Mr. Kevin G. Brady, telephone (301)975–3644, National Institute ofStandards and Technology,Gaithersburg, MD 20899.

Dated: January 18, 1995.Samuel Kramer,Associate Director.

Federal Information ProcessingStandards Publication 153–1

(date)

Announcing the Standard forProgrammer’s Hierarchical InteractiveGraphics System (PHIGS)

Federal Information ProcessingStandards Publications (FIPS PUBS) areissued by the National Institute ofStandards and Technology afterapproval by the Secretary of Commercepursuant to Section 111(d) of theFederal Property and AdministrativeServices Act of 1949 as amended by theComputer Security Act of 1987, PublicLaw 100–235.

1. Name of Standard. Programmer’sHierarchical Interactive GraphicsSystem (PHIGS) (FIPS PUB 153–1).

2. Category of Standard. SoftwareStandard, Graphics.

3. Explanation. This publication is arevision of FIPS PUB 153 andsupersedes that document in itsentirety. This revision provides asubstantial, upward-compatibleenhancement of the basic PHIGSfunctionality known as Plus Lumiereand Surfaces, PHIGS PLUS (ANSI/ISO9592.1a,2a,3a,4:1992). PHIGS PLUSadds facilities for the specification ofcurved lines, curved and facetedsurfaces, lighting and shading, and addsa mechanism for color specification toallow non-indexed color specification.Amendments to each part of the PHIGSspecification detail revisions requiredby PHIGS PLUS. Also, each languagebinding of PHIGS has been amended asa result of PHIGS PLUS. Thespecifications and amendments thatcomprise the complete PHIGS standardas a result of this revision are detailedin the Specification section of thisdocument.

In addition this revision adds arequirement for validation of PHIGSimplementations using eitherFORTRAN or C bindings. However,


validation is currently limited to basicPHIGS functionality, and therefore doesnot include the new functionality ofPHIGS PLUS added by this revision.

FIPS 153–1 adopts the AmericanNational Standard Programmer’sHierarchical Interactive GraphicsSystem, ANSI/ISO 9592.1–3:1989, andANSI/ISO 9592.1a,2a,3a,4:1992, and9593.1:1990, 9593.3:1990, 9593.4:1991,as a Federal Information ProcessingStandard (FIPS). This standard specifiesthe control and data interchangebetween an application program and itsgraphic support system. It provides a setof functions and programming languagebindings for the definition, display andmodification of geometrically relatedobjects, graphical data, and therelationships between the graphicaldata. The purpose of the standard is topromote portability of graphicsapplication programs between differentinstallations. The standard is for use byimplementors as the reference authorityin developing graphics softwaresystems; and by other computerprofessionals who need to know theprecise syntactic and semantic rules ofthe standard.

4. Approving Authority. Secretary ofCommerce.

5. Maintenance Agency. U.S.Department of Commerce, NationalInstitute of Standards and Technology(NIST), Computer Systems Laboratory(CSL).

6. Cross Index.a. ANSI/ISO 9592.1:1989, Information

Processing Systems—ComputerGraphics—Programmer’s HierarchicalInteractive Graphics System (PHIGS),Part 1, Functional Description.

b. ANSI/ISO 9592.1a:1992,Amendment 1, Information ProcessingSystems—Computer Graphics—Programmer’s Hierarchical InteractiveGraphics System (PHIGS), Part 1,Functional Description.

c. ANSI/ISO 9592.2:1989, InformationProcessing Systems—ComputerGraphics—Programmer’s HierarchicalInteractive Graphics System (PHIGS),Part 2, Archive File Format.

d. ANSI/ISO 9592.2a:1992,Amendment 1, Information ProcessingSystems—Computer Graphics—Programmer’s Hierarchical InteractiveGraphics System (PHIGS), Part 2,Archive File Format.

e. ANSI/ISO 9592.3:1989, InformationProcessing Systems—ComputerGraphics—Programmer’s HierarchicalInteractive Graphics System (PHIGS),Part 3, Clear Text Encoding of ArchiveFile.

f. ANSI/ISO 9592.3a:1992,Amendment 1, Information ProcessingSystems—Computer Graphics—

Programmer’s Hierarchical InteractiveGraphics System (PHIGS), Part 3, ClearText Encoding of Archive File.

g. ANSI/ISO 9592.4:1992, InformationProcessing Systems—ComputerGraphics—Programmer’s HierarchicalInteractive Graphics System (PHIGS),Part 4, Plus Lumiere and Surfaces,PHIGS PLUS.

h. ANSI/ISO 9592.1:1990, InformationProcessing Systems—ComputerGraphics—Programmer’s HierarchicalInteractive Graphics System (PHIGS),Language Bindings, FORTRAN.

i. ISO/IEC 9593.1:1990 Tech.Corrigendum, Programmer’sHierarchical Interactive GraphicsSystem (PHIGS), Language Bindings,FORTRAN.

j. ANSI/ISO 9593.3:1990, InformationProcessing Systems—ComputerGraphics—Programmer’s HierarchicalInteractive Graphics System (PHIGS),Language Bindings, Ada.

k. ISO/IEC 9593.3:1990, Tech.Corrigendum, Programmer’sHierarchical Interactive GraphicsSystem (PHIGS) Language Bindings,Ada.

l. ANSI/ISO 9593.4:1991, InformationProcessing Systems—ComputerGraphics—Programmer’s HierarchicalInteractive Graphics System (PHIGS),Language Bindings, C.

7. Related Documents.a. Federal Information Resources

Management Regulations (FIRMR)subpart 201.20.303, Standards, andsubpart 201.39.1002, Federal Standards.

b. Federal ADP andTelecommunications Standards Index,U.S. General Services Administration,Information Resources ManagementService, (updated periodically).

c. NIST, Validated Products List:Programming Languages, DatabaseLanguage SQL, Graphics, GOSIP,POSIX, Security, Published quarterlyand available by subscription from theNational Technical Information Service(NTIS), U.S. Department of Commerce,Springfield, VA 22161.

d. FIPS PUB 69–1, ProgrammingLanguage FORTRAN, adopts ANSIX3.9–1978/R1989.

e. FIPS PUB 119, ProgrammingLanguage Ada, adopts ANSI/MIL–STD–1815A–1983.

f. FIPS PUB 120–1, Graphical KernelSystem (GKS), adopts ANSI X3.124–1985.

g. FIPS PUB 128–1, ComputerGraphics Metafile (CGM), adopts ANSI/ISO 8632:1992.

h. FIPS PUB 160, ProgrammingLanguage C, adopts ANSI/ISO 9899:1992.

i. ANSI/ISO 8632:1992, InformationProcessing Systems—Computer

Graphics Metafile for the Storage andTransfer of Picture DescriptionInformation (Part 1: FunctionalSpecifications; Part 2: CharacterEncoding; Part 3: Binary Encoding; Part4: Clear Text Encoding).

j. ISO/IEC 646:1991, InformationProcessing—7-Bit Coded Character Setfor Information Interchange.

k. ISO 2022:1986, InformationProcessing—ISO 7-Bit and 8-Bit CodedCharacter Sets—Code ExtensionTechniques.

l. ISO 2382/13:1984, DataProcessing—Vocabulary—Part 13:Computer Graphics.

m. ISO 6093:1985, InformationProcessing—Representation of NumericValues in Character Strings forInformation Interchange.

n. ISO 7942:1985, InformationProcessing Systems—ComputerGraphics—Functional Specification ofthe Graphical Kernel System (GKS).

o. ISO 7942/Amendment 1:1991,Computer Graphics—Graphical KernelSystems (GKS) Functional Descriptions.

p. ISO 8805:1988, InformationProcessing—Computer Graphics—Graphical Kernel System (GKS–3D)Extensions Functional Description.

8. Objectives. The primary objectivesof this standard are:—To allow very highly interactive

graphics application programs using2D or 3D hierarchically structuredgraphics data to be easily transportedbetween installations. This willreduce costs associated with thetransfer of programs among differentcomputers and graphics devices,including replacement devices.

—To aid the understanding and use ofdynamic hierarchical graphicsmethods by application programmers.

—To aid manufacturers of graphicsequipment by serving as a guidelinefor identifying useful combinations ofgraphics capabilities in a device.

—To encourage more effectiveutilization and management ofgraphics application programmers byensuring that skills acquired on onejob are transportable to other jobs,thereby reducing the cost of graphicsprogrammer retraining.

—To aid graphics applicationprogrammers in understanding andusing graphics methods by specifyingwell-defined functions and names.This will avoid the confusion ofincompatibility common withoperating systems and programminglanguages.9. Applicability. PHIGS is one of the

computer graphics standards (AppendixA discusses the family of computergraphics standards) provided for use by


all Federal departments and agencies.These graphics standards should beused for all computer graphicsapplications and programs that areeither developed or acquired forgovernment use.

9.1 The FIPS for PHIGS is intendedfor use in computer graphicsapplications that are either developed oracquired for government use. It isspecifically designed to meet theperformance requirements of suchdemanding applications as ComputerAided Design/Computer AidedEngineering/Computer AidedManufacturing, command and control,molecular modelling, simulation andprocess control. It emphasizes thesupport of applications needing a highlydynamic, highly interactive operatorinterface and expecting rapid screenupdate of complex images to beperformed by the display system. ThePHIGS PLUS functionality is designedto support graphics applicationsrequiring lighting and shading, curvedlines, curved and facetted surfaces, andnon-indexed color specification.

9.2 The use of this standard iscompulsory and binding when one ormore of the following situations exist:—The graphics application is very

highly interactive, or containshierarchically structured graphicsdata, or requires rapid modification of2D or 3D graphics data and therelationships among the data.

—It is anticipated that the life of thegraphics program will be longer thanthe life of the presently utilizedgraphics equipment.

—The graphics application or programis under constant review for updatingof the specifications, and changes mayresult frequently.

—The graphics application is beingdesigned and programmed centrallyfor a decentralized system thatemploys computers of different makesand models and different graphicsdevices.

—The graphics program will or might berun on equipment other than that forwhich the program is initially written.

—The graphics program is to beunderstood and maintained byprogrammers other than the originalones.

—The graphics program is or is likely tobe used by organizations outside theFederal government (i.e., State andlocal governments, and others).9.3 Nonstandard features of

implementations of PHIGS should beused only when the needed operation orfunction cannot reasonably beimplemented with the standard featuresalone. Although nonstandard features

can be very useful, it should berecognized that the use of these or anyother nonstandard elements may makethe interchange of graphics programsand future conversion more difficultand costly.

10. Specifications. American NationalStandard Programmer’s HierarchicalInteractive Graphics System, ANSI/ISO9592.1–3:1989 and ANSI/ISO9592.1a,2a,3a,4:1992, define the scopeof the specifications, the syntax andsemantics of the PHIGS elements andrequirements for conformingimplementations. All of thesespecifications apply to FederalGovernment implementations of thisstandard.

ANSI/ISO 9592.1–3:1989 and ANSI/ISO 9592.1a,2a,3a,4:1992 define alanguage independent nucleus of agraphics system for integration into aprogramming language. Thus, it isembedded in a language layer obeyingthe particular conventions of thelanguage. FIPS 153–1 is thereforedivided into two parts. Part 1 representsthe functional aspects of PHIGS. Part 1consists of the following:

(1) Functional description (ANSI/ISO9592.1:1989) and (ANSI/ISO9592.1a:1992, Amendment 1)

The functional description of PHIGSprovides a set of functions for thedefinition, display and modification of2D or 3D graphical data. It also providesfor the definition, display andmanipulation of geometrically relatedobjects, along with the modification ofgraphics data and the relationshipsbetween that graphical data.

(2) Archive file format (ANSI/ISO9592.2:1989) and (ANSI/ISO9592.2a:1992, Amendment 1)

The archive file provides a file formatsuitable for the storage and retrieval ofPHIGS structures and structure networkdefinitions. It allows structuredefinitions to be stored in an organizedway on a graphical software system.And, facilitates transfer of structuredefinitions between different graphicalsoftware systems.

(3) Clear-text encoding (ANSI/ISO9592.3:1989) and (ANSI/ISO9592.3a:1992, Amendment 1)

The clear-text encoding provides arepresentative of the archive file syntaxthat is easy to type, edit and read. Thefile is human-readable (allows editing),human friendly (easy and natural toread) and machine readable (parsable bysoftware).

(4) Plus Lumiere and Surfaces, PHIGSPLUS (ANSI/ISO 9592.4:1992)

The Programmer’s HierarchicalInteractive Graphics System (PHIGS)Plus Lumiere and Surfaces (PHIGSPLUS) extends the basic PHIGS

functionality by adding facilities for thespecification of curved lines, curvedand faceted surfaces, lighting and othereffects such as depth modulation.

Part 2 of FIPS 153–1 consists of thebindings of PHIGS and PHIGS PLUSfunctions to actual programminglanguages, defined in ANSI/ISO9593:1990. These bindings aredeveloped in cooperation with thevoluntary standards committees of thevarious languages. The followingbindings currently exist, and form part2 of FIPS 153–1:—The FORTRAN Language binding for

PHIGS (ANSI/ISO 9593.1:1990);—The ADA Language binding for PHIGS

(ANSI/ISO 9593.3:1990);—The C Language binding for PHIGS

(ANSI/ISO 9593.4:1991).Subsequent language bindings,

including those for PHIGS PLUS, will beadded periodically as they becomeavailable. As these bindings areapproved by ANSI, each languagebinding will become part of thisstandard.

11. Implementation. Implementationof this standard involves four areas ofconsideration: the effective date,acquisition of PHIGS software systemimplementations, interpretations ofPHIGS implementations, and validationof PHIGS implementations.

11.1 Effective Date. This revisedstandard is effective August 1, 1995.Requirements for the use of basic PHIGSfunctionality (defined in ANSI/ISO9592.1–3:1989 and ANSI/ISO9593.1:1990, 9593.3:1990, 9593.4:1991)are unchanged and continue in effect.Validation of PHIGS implementations isrequired after the effective date inaccordance with Section 11.4.

11.2 Acquisition ofImplementations. Conformance to FIPSfor PHIGS is required whether PHIGStoolbox packages are developedinternally, acquired as part of an ADPsystem procurement, acquired byseparate procurement, used under anADP leasing arrangement, or specifiedfor use in contracts for programmingservices. Recommended terminology forprocurement of FIPS for PHIGS iscontained in the U.S. General ServicesAdministration publication FederalADP & Telecommunications StandardIndex, Chapter 4 Part 1.

11.3 Interpretation of this FIPS.NIST provides for the resolution ofquestions regarding FIPS for PHIGSspecifications and requirements, andissues official interpretations as needed.Procedures for interpretations arespecified in FIPS PUB 29–3. Allquestions about the interpretation ofFIPS for PHIGS should be addressed to:


Director, Computer Systems Laboratory(CSL), Attn: PHIGS Interpretation,National Institute of Standards andTechnology, Gaithersburg, MD 20899,Telephone: (301) 975–3265.

11.4 Validation of PHIGSImplementations. Implementations ofFIPS for PHIGS using either FORTRANor C bindings shall be validated inaccordance with NIST ComputerSystems Laboratory (CSL) validationprocedures for FIPS for PHIGS.Recommended procurementterminology for validation of FIPS forPHIGS is contained in the U.S. GeneralServices Administration publicationFederal ADP & TelecommunicationsStandards Index, Chapter 4 Part 2. ThisGSA publication provides terminologyfor three validation options: DelayedValidation, Prior Validation Testing,and Prior Validation. The agency shallselect the appropriate validation option.The agency is advised to refer to theNIST publication Validated ProductsList for information about the validationstatus of PHIGS products. Thisinformation may be used to specifyvalidation time frames that are notunduly restrictive of competition.

The agency shall specify the criteriaused to determine whether a ValidationSummary Report (VSR) or Certificate isapplicable to the hardware/softwareenvironment of the PHIGSimplementation offered. The criteria forapplicability of a VSR or Certificateshould be appropriate to the size andtiming of the procurement. A largeprocurement may require that theoffered version/release of the PHIGSimplementation shall be validated in aspecified hardware/softwareenvironment and that the validationshall be conducted with specifiedhardware/software features or parametersettings; e.g., the same parametersettings to be used in a performancebenchmark. An agency with a single-license procurement may review theValidated Products List to determine theapplicability of existing VSRs orCertificates to the agency’s hardware/software environment.

PHIGS implementations using eitherFORTRAN or C bindings shall bevalidated using the NIST PHIGS TestSuite, a suite of automated validationtests for PHIGS implementations. TheNIST PHIGS Test Suite was firstreleased in July 1990 to help users andvendors determine compliance withFIPS for PHIGS. The most recent versionof the test suite will be used forvalidating conformance of PHIGSimplementations after the effective dateof FIPS PUB 153–1. The results ofvalidation testing by the PHIGS TestingService are published on a quarterly

basis in the Validated Products List,available from the National TechnicalInformation Service (NTIS). See relateddocuments section.

Each release of the test suite hasprovided additional language bindingsand test cases to increase the test suite’scoverage of PHIGS functionality.Version 2.1 of the NIST PHIGS TestSuite, released in April 1994, providestesting for PHIGS implementationsusing either the FORTRAN or Clanguage binding. Version 2.1 does notinclude tests for the functionality ofPHIGS PLUS added by this revision ofFIPS of PHIGS.

A PHIGS Test Suite license includesall of the tests described above,documentation, and automaticnotifications of approved changes to thePHIGS Test Suite for a six monthperiod. A license for the most recentversion of the PHIGS Test Suite is anecessary requirement for anorganization that desires to be tested bythe NIST PHIGS Testing Service afterthe effective date of FIPS 153–1.

Current information about the NISTPHIGS Validation Service andvalidation procedures for FIPS forPHIGS is available from: NationalInstitute of Standards and Technology,Computer Systems Laboratory, GraphicsSoftware Group, Building 225, RoomA266, Gaithersburg, MD 20899, (301)975–3265.

12. Waivers. Under certainexceptional circumstances, the heads ofFederal departments and agencies mayapprove waivers to Federal InformationProcessing Standards (FIPS). The headof such agency may redelegate suchauthority only to a senior officialdesignated pursuant to section 3506(b)of Title 44, United States Code.

Waivers shall be granted only when:a. Compliance with a standard would

adversely affect the accomplishment ofthe mission of an operator of a Federalcomputer system, or

b. Cause a major adverse financialimpact on the operator which is notoffset by Governmentwide savings.

Agency heads may act upon a writtenwaiver request containing theinformation detailed above. Agencyheads may also act without a writtenwaiver request when they determinethat conditions for meeting the standardcannot be met. Agency heads mayapprove waivers only by a writtendecision which explains the basis uponwhich the agency head made therequired findings(s). A copy of eachsuch decision, with procurementsensitive or classified portions clearlyidentifed, shall be sent to: NationalInstitute of Standards and Technology;Attn: FIPS Waiver Decisions,

Technology Building, Room B–154;Gaithersburg, MD 20899. In additionnotice of each waiver granted and eachdelegation of authority to approvewaivers shall be sent promptly to theCommittee on Government Operationsof the House of Representatives and theCommittee on Governmental Affairs ofthe Senate and shall be publishedpromptly in the Federal Register.

When the determination on a waiverapplies to the procurement ofequipment and/or services, a notice ofthe waiver determination must bepublished in the Commerce BusinessDaily as a part of the notice ofsolicitation for offers of an acquisitionor, if the waiver determination is madeafter that notice is published, byamendment to such notice.

A copy of the waiver, any supportingdocuments, the document approving thewaiver and any supporting andaccompanying documents, with suchdeletions as the agency is authorizedand decides to make under 5 U.S.C. Sec.552(b), shall be part of the procurementdocumentation and retained by theagency.

13. Where to Obtain Copies. Copies ofthis publication are for sale by theNational Technical Information Service,U.S. Department of Commerce,Springfield, VA 22161. (Sale of theincluded specifications document is byarrangement with the AmericanNational Standards Institute. Whenordering, refer to Federal InformationProcessing Standards Publication 153–1(FIPSPUB153–1) and title. Payment maybe made by check, money order, ordeposit account.

Appendix A—The Family of GraphicsStandards

The following computer graphicsstandards are now available to addressthe needs of government applications increating, modifying, manipulating, andexchanging computer-generatedpictures:

• FIPS PUB 120–1, the GraphicalKernel System (GKS), which adoptsANSI X3.124–1985;

• FIPS PUB 153–1, the Programmer’sHierarchical Interactive GraphicsSystem (PHIGS), which adopts ANSI/ISO 9592–1989;

• FIPS PUB 128–1, the ComputerGraphics Metafile (CGM), which adoptsANSI/ISO 8632–1992 and

• FIPS PUB 177, the Initial GraphicsExchange Specification (IGES), whichadopts ASME/ANSI Y14.26M–1989.

In addition, the Computer GraphicsInterface (CGI) has recently become anInternational standard, and is expectedto be issued as a FIPS.


These standards fall into twocategories: Application Programmer’sInterface (API) standards, andInteroperability standards. The goal ofAPI standards is to enhance theportability of graphics programs (andprogrammers) between installations andenvironments. The goal ofInteroperability standards is to enablegraphics data to be exchangedsuccessfully between graphics systemsand devices.

Figure 1 is a very simple referencemodel of a computer graphics operatingenvironment. The model emphasizesthat a graphics application program

interacts with physical devices andhuman operators via a computergraphics environment. Figure 1 alsoshows that the application may receiveinformation from an external database.

The output of the graphics program,as shown in Figure 1, is directed to avirtual graphics device (i.e., VirtualDevice Interface or VDI) rather thandirectly to a physical device. A DeviceDriver provides an interface,implemented in either hardware orsoftware, for translating virtual devicecommands to commands understood bya particular physical device. Bysubstituting one device driver for

another, an application can run on adifferent physical device. This deviceindependence is a central concept ofthis graphics reference model.

In Figure 1, the API standards residein the box labelled the DeviceIndependent Graphics Package.Interoperability standards are related tothe boxes in Figure 1 labelled Metafile,Database and Virtual Device Interface.Figure 2 depicts the various graphicsstandards associated with the generalmodel shown in Figure 1. These arediscussed below.

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Application Programmer’s Interface(API) Standards

Standards at the API promote programand programmer portability. A standardat this level specifies a set of operationson a variety of graphics objects. An APIstandard provides for the portability ofapplications across a wide range ofcomputer hardware, operating systems,programming languages, and graphicsdevices. A program written to an APIstandard at one facility in oneenvironment should be easilytransferable to another facility in adifferent environment. Facilitydependencies should be the major arearequiring modification.

The specific functions supported by aparticular API standard provide certaincapabilities. The applicationprogrammer, by identifying thecapabilities needed, determines the APIbetter suited for the application. Asshown in Figure 2, there are currentlytwo graphics API standards, GKS andPHIGS.

GKS provides a functional descriptionof a two-dimensional (2D) graphicsinterface. It provides the basic graphicssupport required by a wide variety ofapplication requiring the production ofcomputer-generated pictures. Aprocedural language binding of afunctional standard specifies the exactname for each operation, its parametersequence, and the data types for theparameters. FORTRAN, Pascal, Ada andC language bindings are parts of GKS.

GKS is suitable for use in graphicsprogramming applications that employ abroad spectrum of graphics, from simplepassive graphics output (where picturesare produced solely by output functionswithout interaction with an operator) tointeractive applications; and whichcontrol a whole range of graphicsdevices, including but not limited tovector and raster devices, microfilmrecorders, storage displays, refreshdisplays, and color displays.

PHIGS provides for the definition,display, modification, and manipulationof 2D and graphical data. It providesfunctionality to support storage ofgraphics and application data in ahierarchical form. Information may beinserted, changed, and deleted from thehierarchical data storage with thefunctions provided by PHIGS. Languagebinding specifications for PHIGSinclude FORTRAN, C and Ada.

PHIGS is specifically designed tomeet the performance requirements ofsuch demanding applications asComputer Aided Design/ComputerAided Engineering/Computer AidedManufacturing, command and control,

molecular modelling, simulation andprocess control.

Capabilities in PHIGS but not in GKSinclude: the centralized hierarchicaldata storage; the dynamic andresponsive nature of interactions; theaddition of a modeling capability; andsupport for color models other thanRed-Green-Blue (RGB).

Interoperability StandardsGraphics Interoperability standards

allow graphical data to be interchangedbetween graphics devices. As shown inFigure 2, there are three graphicsinteroperability standards, CGM,(future) CGI, and IGES.

CGM is used for the storage andtransfer of picture descriptioninformation. It enables pictures to berecorded for long term storage, and to beexchanged between graphics devices,systems, and installations. As indicatedin Figure 2, the storage mechanism forCGM is in the form of a neutral fileformat called a metafile. The softwarewhich creates the metafile is known asa CGM Generator. The software whichreads and displays a CGM metafile isknown as an Interpreter.

CGM specifies a semantic interfacethat describes 2D graphical entitiesusing primitives (like polyline, text, andellipse) and attributes (like color, linewidth, interior style, and fonts). CGM iscompatible with the specification of 2Delements in GKS. A data encodingspecifies the exact sequence of bits usedto represent each operation and itsparameters. CGM contains three types ofdata stream encodings (binary,character, and clear text) to provide theimplementor choices depending on theparticular application.

IGES provides a method forrepresenting and storing geometric,topological, and non-geometric productdefinition data that is independent ofany one system. Where CGM transfersgraphical pictures, IGES transfers agraphical database which can beprocessed to represent a picture. ThusIGES represents more than just purelygraphical data. As Figure 2 indicates,the storage mechanism for IGES is in theform of a neutral format that must betranslated by a Preprocessor andPostprocessor for conversion betweensystems. IGES permits the compatibleexchange of product definition dataused by various computer aided design/computer aided manufacturing (CAD/CAM) systems.

The future CGI standard is designedto specify the exchange of informationat the Virtual Device Interface. It willprovide an interface between the deviceindependent and device dependentparts of a graphic system. Since CGI

contains information at a vitual level, itcan be used to create a CGM. A CGMcan also be output on a CGI device ina straightforward manner.

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RIN 0693–AB22

Approval of Federal InformationProcessing Standards Publication172–1, VHSIC Hardware DescriptionLanguage (VHDL)

AGENCY: National Institute of Standardsand Technology (NIST), Commerce.ACTION: The purpose of this notice is toannounce that the Secretary ofCommerce has approved a revisedstandard, which will be published asFIPS Publication 172–1, VHSICHardware Description Language(VHDL). This FIPS adopts languagespecifications contained in ANSI/IEEE1076–1993, IEEE Standard VHDLLanguage Reference Manual.

SUMMARY: On April 12, 1994 (59 FR17336–17338), notice was published inthe Federal Register that a revision toFederal Information ProcessingStandard 172, VHSIC HardwareDescription Language (VHDL) was beingproposed for Federal use.

The written comments submitted byinterested parties and other materialavailable to the Department relevant tothe revised standard was reviewed byNIST. On the basis of this review, NISTrecommended that the Secretaryapprove the revised standard as aFederal Information ProcessingStandards Publication, and prepared adetailed justification document for theSecretary’s review in support of thatrecommendation.

The detailed justification documentwhich was presented to the Secretary ispart of the public record and is availablefor inspection and copying in theDepartment’s Central Reference andRecords Inspection Facility, Room 6020,Herbert C. Hoover Building, 14th Streetbetween Pennsylvania and ConstitutionAvenues, NW, Washington, DC 20230.

This FIPS contains two sections: (1)An announcement section, whichprovides information concerning theapplicability, implementation, andmaintenance of the standard; and (2) aspecifications section which deals withthe technical requirements of thestandard. Only the announcementsection of the standard is provided inthis notice.EFFECTIVE DATE: This revised standardbecomes effective May 1, 1995. Prior to


that date the requirements of FIPS PUB172 apply to Federal VHDLprocurements. This delayed effectivedate is intended to provide sufficienttime for implementors of FIPS PUB 172to make enhancements necessary forconformance of products to FIPS PUB172–1.ADDRESSES: Interested parties maypurchase copies of this revisedstandard, including the technicalspecifications section, from the NationalTechnical Information Service (NTIS).Specific ordering information fromNTIS for this standard is set out in theWhere to Obtain Copies Section of theannouncement section of the standard.FOR FURTHER INFORMATION CONTACT:Dr. William H. Dashiell, telephone (301)975–2490, National Institute ofStandards and Technology,Gaithersburg, MD 20899.

Dated: January 18, 1995.Samuel Kramer,Associate Director.

Federal Information ProcessingStandards Publication 172–1

199X Month Day

Announcing the Standard for VHSICHardware Description Language (VHDL)

Federal Information ProcessingStandards Publications (FIPS PUBS) areissued by the National Institute ofStandards and Technology (NIST) afterapproval by the Secretary of Commercepursuant to Section 111(d) of theFederal Property and AdministrativeServices Act of 1949 as amended by theComputer Security Act of 1987, PublicLaw 100–235.

1. Name of Standard. VHSICHardware Description Language (VHDL)(FIPS PUB 172–1).

2. Category of Standard. SoftwareStandard, hardware DescriptionLanguage.

3. Explanation. This publication is arevision of FIPS PUB 172 andsupersedes that document in itsentirety.

This publication announces theadoption of the Federal InformationProcessing Standard (FIPS) for VHDL.This FIPS adopts American NationalStandard Hardware DescriptionLanguage VHDL (ANSI/IEEE 1076–1993) as stipulated in the SpecificationsSection. The American NationalStandard specifies the form andestablishes the interpretation ofprograms expressed in VHDL. Thepurpose of the standard is to promoteportability of VHDL programs for use ona variety of data processing systems.The standard is used by implementorsas the reference authority in developing

compilers, interpreters, analyzers,simulators or other forms of high levellanguage processors, and is used bydigital hardware designers, and by othercomputer professionals who need toknow the precise syntactic and semanticrules of the standard and who need toprovide specifications for digitalhardware descriptions.

4. Approving authority. Secretary ofCommerce.

5. Maintenance Agency. U.S.Department of Commerce, NationalInstitute of Standards and Technology(NIST), Computer Systems Laboratory(CSL).

6. Cross Index. ANSI/IEEE 1076–1993,IEEE Standard VHDL LanguageReference Manual.

7. Related Documents.a. Federal Information Resources

Management Regulations (FIRMR)subpart 201.20.303, Standards, andsubpart 201.39.1002, Federal Standards.

b. Federal ADP andTelecommunications Standards Index,U.S. General Services Administration,Information Resources ManagementService, April 1994 (updatedperiodically).

c. NIST, Validated Products List,NISTIR 5475 (republished quarterly).Available by subscription from theNational Technical Information Service(NTIS).

d. FIPS PUB 29–3, InterpretationProcedures for FIPS Software, 29October 1992.

8. Objectives. Federal standards forhigh level digital design informationand description languages permitFederal departments and agencies toexercise more effective control over thedesign, production, management, andmaintenance of digital electronicsystems. The primary objectives of thisFederal hardware description languagestandard are:—to encourage more effective utilization

of design personnel by ensuring thatdesign skills acquired under one jobare transportable to other jobs, therebyreducing the cost of programmerretraining;

—to reduce the cost of design byachieving increased designerproductivity and design accuracythrough the use of formal languages;

—to reduce the overall life cycle cost fordigital systems by establishing acommon description language for thetransfer of digital design informationacross organizational boundaries;

—to protect the immense investment ofdigital hardware from obsolescence byinsuring to the maximal feasibleextent that Federal hardwaredescription language standards are

technically sound and thatsubsequent revisions are compatiblewith the installed base.

—to reduce Federal inventory ofelectronic digital replacement parts bydescribing these parts in a form whichenable suppliers to quickly retoolmanufacturing facilities to meetFederal needs.

—to increase the sources of supplieswhich can satisfy governmentrequirements for mission specificelectronic digital components.Government-wide attainment of the

above objectives depends upon thewidespread availability and use ofcomprehensive and precise standardlanguage specifications.

9. Applicability.a. Federal standards for hardware

description languages are applicable forthe design and description of digitalsystems developed for government use.This standard is suitable for use in thefollowing digital system applications:—primary design and description of

digital systems, subsystems,assemblies, hybrid components, andcomponents;

—formal specifications of digitalsystems throughout the procurement,contracting and development process;

—test generation for digital systems,subsystems, assemblies, hybridcomponents, and components;

—re-procurement and redesign of digitalsystems, subsystems, assemblies,hybrid components, and components.b. The use of FIPS hardware

description languages applies when oneor more of the following situations exist:—When using a formal language for

specifying a formal designspecification for a complex digitalsystem.

—The digital system is under constantrevision during the developmentprocess.

—It is desired to have the designunderstood by multiple groups, ororganizations.

—The system under development is tobe designed by multiple groups, ororganizations.

—Accurate unambiguous specificationsare required in the bid andcontracting process.10. Specifications. The Specifications

for this standard are the languagespecifications contained in ANSI/IEEE1076–1993, IEEE Standard VHDLLanguage Reference Manual.

This FIPS does not allow conformingimplementations to extend the language.A conforming implementation is onethat does not allow inclusion ofsubstitute or additional languageelements in order to accomplish a


feature of the language as specified inthe language standard. A conformingimplementation is one which adheres toand implements all of the languagespecifications contained in ANSI/IEEE1076–1993 except where the languagestandard permits deviations and whichspecifies conspicuously in a separatesection in the conformingimplementation description all suchpermitted variations. Also, suchconformance shall be with defaultlanguage processor system optionsettings.

The ANSI/IEEE 1076–1993 documentdoes not specify limits on the size orcomplexity of programs, the resultswhen the rules of the standard fail toestablish an interpretation, the means ofsupervisory control programs, or themeans of transforming programs forprocessing.

11. Implementation. Theimplementation of this standardinvolves three areas of consideration:acquisition of VHDL processors,interpretation of FIPS VHDL, andvalidation of VHDL processors.

11.1 Effective Date. This revisedstandard becomes effective May 1, 1995.VHDL processors acquired for Federaluse after the effective date shallimplement FIPS Pub 172–1. Prior to thatdate requirements of FIPS Pub 172apply to Federal VHDL procurements.This delayed effective date is intendedto give implementations that conform toFIPS Pub 172 time to make theenhancements necessary to enableconformance to FIPS Pub 172–1.

A transition period provides time forindustry to produce VHDL languageprocessors conforming to the FIPS Pub172–1. The transition period begins onthe effective date and continues for 12months thereafter. The provisions ofFIPS Pub 172–1 apply to orders placedafter the effective date of thispublication; however a processorconforming to the FIPS Pub 172–1, ifavailable, may be acquired for use priorto the effective date. If, during thetransition period, a processorconforming to FIPS Pub 172–1 is notavailable, a processor conforming toFIPS Pub 172 may be acquired forinterim use during the transition period.

11.2 Acquisition of VHDLProcessors. Conformance to FIPS VHDLshould be considered whether VHDLprocessors are developed internally,acquired as part of an ADP systemprocurement, acquired by separateprocurement, used under an ADPleasing arrangement, or specified for usein contracts for hardware descriptionservices. Recommended terminology forprocurement of FIPS VHDL is containedin the U.S. General Services

Administration publication FederalADP & Telecommunications StandardsIndex, Chapter 4 Part 1.

11.3 Interpretation of FIPS VHDL.The National Institute of Standards andTechnology provides for the resolutionof questions regarding the specificationsand requirements, and issues officialinterpretations as needed. All questionsabout the interpretation of this standardshould be addressed to: Director,Computer Systems Laboratory, ATTN:FIPS VHDL Interpretation, NationalInstitute of Standards and Technology,Gaithersburg, MD 20899, Voice: 301–975–2490, FAX: 301–948–6213,[email protected] e-mail.

11.4 Validation of VHDL Processors:The validation of VHDL processors forconformance to this standard applieswhen NIST VHDL validation proceduresare available. At the present time NISTdoes not have procedures for validatingVHDL processors. NIST is currentlyinvestigating methods which may beconsidered for validating processors forconformance to this standard.

For further information contact:Director, Computer Systems Laboratory,Attn: FIPS VHDL Validation, NationalInstitute of Standards and Technology,Gaithersburg, MD 20899, Voice: 301–975–2490, FAX: 301–948–6213,dashiellalpha.ncsl.nist.gov e-mail.

12. Waivers.Under certain exceptional

circumstances, the heads of Federaldepartments and agencies may approvewaivers to Federal InformationProcessing Standards (FIPS). The headof such agency may redelegate suchauthority only to a senior officialdesignated pursuant to section 3506(b)of Title 44, U.S. Code. Waivers shall begranted only when:

a. Compliance with a standard wouldadversely affect the accomplishment ofthe mission of an operator of a Federalcomputer system, or

b. Cause a major adverse financialimpact on the operator which is notoffset by Government-wide savings.

Agency heads may act upon a writtenwaiver request containing theinformation detailed above. Agencyheads may also act without a writtenwaiver request when they determinethat conditions for meeting the standardcannot be met. Agency heads mayapprove waivers only by a writtendecision which explains the basis onwhich the agency head made therequired finding(s). A copy of each suchdecision, with procurement sensitiveclassified portions clearly identified,shall be sent to: National Institute ofStandards and Technology, ATTN: FIPSWaiver Decisions, Technology Building,Room B–154, Gaithersburg, MD 20899.

In addition, notice of each waivergranted and each delegation of authorityto approve waivers shall be sentpromptly to the Committee onGovernment Operations of the House ofRepresentatives and the Committee onGovernmental Affairs of the Senate andshall be published promptly in theFederal Register.

When the determination on a waiverapplies to the procurement ofequipment and/or services, a notice ofthe waiver determination must bepublished in the Commerce BusinessDaily as a part of the notice ofsolicitation for offers of an acquisitionor, if the waiver determination is madeafter that notice is published, byamendment to such notice.

A copy of the waiver, any supportingdocuments, the document approving thewaiver and any supporting andaccompanying documents, with suchdeletions as the agency is authorizedand decides to make under 5 U.S.C.Section 552(b), shall be part of theprocurement documentation andretained by the agency.

13. Where to Obtain Copies. Copies ofthis publication are for sale by theNational Technical Information Service,U.S. Department of Commerce,Springfield, VA 22161, telephone (703)487–4650. (Sale of the includedspecifications document is byarrangement with the AmericanNational Standards Institute.) Whenordering, refer to Federal InformationProcessing Standards Publication 172–1(FIPSPUB172–1), and title. Paymentmay be made by check, money order, ordeposit account.

[FR Doc. 95–2104 Filed 1–26–95; 8:45 am]BILLING CODE 3510–CN–M

Technology Administration

Metric Policy Interagency Council andCommerce Department; Metric TownMeeting

ACTION: Notice.

SUMMARY: The Department of Commerceand the Interagency Council on MetricPolicy will hold a Metric Town Meetingto listen to the concerns and ideas of theprivate sector for accelerating thetransition to the metric systemincluding actions that the Governmentcan take to make it easier for industryto convert to metric use. Writtensubmissions of views are welcome. All,however, are encouraged to participatein person at the Metric Town Meetingto benefit from sharing of views. Thosewishing to speck should briefly describetheir topic(s) and summarize their


remarks in writing. All writtensubmissions and summaries should bereceived in the Metric Program Office byFebruary 27, 1995.DATES: The Metric Town Meeting willbe held on Monday, March 27, 1995,and may extend into Tuesday, March28, to accommodate additionalresponses and speakers.ADDRESSES: The meeting will be held atthe National Institute of Standards andTechnology in Gaithersburg, Maryland.FOR FURTHER INFORMATION CONTACT:Organizations and individualsinterested in participating shouldcontract the Director, Metric Program,U.S. Department of Commerce, NationalInstitute of Standards and Technology,Gaithersburg, MD 20899 as early aspossible but before February 27, 1995.Phone (301–975–3690) and FAX (301–948–1416) messages are welcomed.SUPPLEMENTARY INFORMATION: Worldtrade is geared toward to metric systemof measurement. Industry in the unitedStates is often at a competitivedisadvantage when dealing ininternational markets if its designs orproduction measurement units differfrom those used by the rest of the work.U.S. companies can be excluded frominternational markets when unable todeliver goods which are built to metricspecifications. The Nation can notignore these globalization pressures.

The North American Free TradeAgreement (NAFTA) and the newlyratified General Agreement on Tariffsand Trade (GATT) have expanded theopportunities for international trade andcommerce. To take advantage of thoseopportunities and to enhance theacceptability of U.S. products, U.S.business must expedite the adoption ofthe metric system

Under the provisions of the OmnibusTrade and Competitiveness Act of 1988,which establishes the metric system asthe preferred system of measurement fortrade and commerce, the Federalgovernment is required to assistindustry, especially small business, inconverting to the metric system.Pursuant to Executive Order 12770, theU.S. Department of Commerce and theInteragency Council on Metric Policyhave been charged to explore ways tobring together the government, theprivate sector and the public to discussthe nest steps in decision-making aboutmetric conversion.

The Department of Commerce and theInteragency Council on Metric Policywill hold a Metric Town Meeting tolisten to the concerns and ideas of theprivate sector for accelerating thetransition to the metric systemincluding actions that the Government

can take to make it easier for industryto convert to metric system use.Accordingly, the Town Meeting willseek views from businesses, trade andprofessional groups, educators, and stateand local government entities on topicssuch as:

• How using the metric systemcontributes to key national goals such asU.S. global competitiveness, technologydevelopment and commercialization,enhanced labor skills, and U.S.education reform;

• How the effective implementationof trade agreements (e.g., NAFTA andGATT) will be influenced by industry’suse or non-use of metric measures;

• What plans the Federal governmentand individual agencies shouldundertake to complete a smoothconversion to the metric system in U.S.trade and commerce;

• How industry and Federal, state,and local governments should informsmall and midsized companies and theirworkers about how their economicprosperity may be tied, even ifindirectly, to global markets, andinvolve them in more positivediscussions on metrication;

• Identifying or eliminating Federalregulatory barriers to metrication;

• Identifying outdated Federalstandards that may contribute tocontinued use of non-metric measures;

• How Federal procurement practicesshould support metrication efforts;

• What public education orawareness strategies government orindustry should initiate to acceleratepublic understanding and acceptance ofthe transition to the metric system.(15 U.S.C. 205(b) and (c))

Dated: January 23, 1995Mary L. Good,Under Secretary for Technology.[FR Doc. 95–2046 Filed 1–26–95; 8:45 am]BILLING CODE 3510––18–M–M

COMMITTEE FOR THEIMPLEMENTATION OF TEXTILEAGREEMENTS

Announcement of Import RestraintLimits for Certain Cotton, Man-MadeFiber, Silk Blend and Other VegetableFiber Textiles and Textile ProductsProduced or Manufactured in thePeople’s Republic of Bangladesh

January 24, 1995.AGENCY: Committee for theImplementation of Textile Agreements(CITA).ACTION: Issuing a directive to theCommissioner of Customs establishinglimits for the new agreement year.

EFFECTIVE DATE: February 1, 1995.FOR FURTHER INFORMATION CONTACT: RossArnold, International Trade Specialist,Office of Textiles and Apparel, U.S.Department of Commerce, (202) 482–4212. For information on the quotastatus of these limits, refer to the QuotaStatus Reports posted on the bulletinboards of each Customs port or call(202) 927–5850. For information onembargoes and quota re-openings, call(202) 482–3715.

SUPPLEMENTARY INFORMATION:Authority: Executive Order 11651 of March

3, 1972, as amended; section 204 of theAgricultural Act of 1956, as amended (7U.S.C. 1854).

The Bilateral Textile Agreement ofDecember 10, 1994 between theGovernments of the United States andthe People’s Republic of Bangladeshestablishes limits, pursuant to theUruguay Round Agreement on Textilesand Clothing (URATC), for the periodbeginning on January 1, 1995 andextending through December 31, 1995.The limits have been reduced to accountfor carryforward used and specialcarryforward used during 1994.

A copy of the bilateral textileagreement is available from the TextilesDivision, Bureau of Economic andBusiness Affairs, U.S. Department ofState, (202) 647–1683.

A description of the textile andapparel categories in terms of HTSnumbers is available in theCORRELATION: Textile and ApparelCategories with the Harmonized TariffSchedule of the United States (seeFederal Register notice 59 FR 65531,published on December 20, 1994).

The letter to the Commissioner ofCustoms and the actions taken pursuantto it are not designed to implement allof the provisions of the agreement, butare designed to assist only in theimplementation of certain of itsprovisions.Rita D. Hayes,Chairman, Committee for the Implementationof Textile Agreements.

Committee for the Implementation of TextileAgreementsJanuary 24, 1995.Commissioner of Customs,Department of the Treasury, Washington, DC

20229.Dear Commissioner: Under the terms of

section 204 of the Agricultural Act of 1956,as amended (7 U.S.C. 1854), and the UruguayRound Agreement on Textiles and Clothing(URATC); pursuant to the Bilateral TextileAgreement of December 10, 1994 between theGovernments of the United States and thePeople’s Republic of Bangladesh; and inaccordance with the provisions of ExecutiveOrder 11651 of March 3, 1972, as amended,


you are directed to prohibit, effective onFebruary 1, 1995, entry into the United Statesfor consumption and withdrawal fromwarehouse for consumption of cotton, man-made fiber, silk blend and other vegetablefiber textiles and textile products in thefollowing categories, produced ormanufactured in Bangladesh and exportedduring the twelve-month period beginning onJanuary 1, 1995 and extending throughDecember 31, 1995, in excess of the followinglevels of restraint:

Category Twelve-month restraintlimit 1

237 .......................... 309,820 dozen.331 .......................... 784,917 dozen pairs.334 .......................... 89,644 dozen.335 .......................... 169,709 dozen.336/636 ................... 303,700 dozen.338/339 ................... 879,784 dozen.340/640 ................... 1,886,237 dozen.341 .......................... 1,562,576 dozen.342/642 ................... 285,052 dozen.347/348 ................... 1,482,791 dozen.351/651 ................... 429,372 dozen.352/652 ................... 8,007,120 dozen.363 .......................... 16,004,493 numbers.369–S 2 .................... 1,131,129 kilograms.634 .......................... 313,625 dozen.635 .......................... 203,191 dozen.638/639 ................... 1,115,728 dozen.641 .......................... 654,294 dozen.645/646 ................... 262,016 dozen.647/648 ................... 884,478 dozen.847 .......................... 469,625 dozen.

1 The limits have not been adjusted to ac-count for any imports exported after December31, 1994.

2 Category 369–S: only HTS number6307.10.2005.

Imports charged to these category limits forthe periods February 1, 1994 throughDecember 31, 1994 and December 1, 1994through December 31, 1994 (Categories 352/652) shall be charged against those levels ofrestraint to the extent of any unfilledbalances. In the event the limits establishedfor those periods have been exhausted byprevious entries, such goods shall be subjectto the levels set forth in this directive.

The limits set forth above are subject toadjustment in the future pursuant to theprovisions of the URATC and anyadministrative arrangements notified.

In carrying out the above directions, theCommissioner of Customs should construeentry into the United States for consumptionto include entry for consumption into theCommonwealth of Puerto Rico.

The Committee for the Implementation ofTextile Agreements has determined thatthese actions fall within the foreign affairsexception of the rulemaking provisions of 5U.S.C. 553(a)(1).

Sincerely,Rita D. Hayes,Chairman, Committee for the Implementationof Textile Agreements.[FR Doc. 95–2102 Filed 1–26–95; 8:45 am]BILLING CODE 3510–DR–F

Amendment of Export VisaRequirements for Certain Cotton andMan-Made Fiber Textile ProductsProduced or Manufactured inBangladesh

January 24, 1995.AGENCY: Committee for theImplementation of Textile Agreements(CITA).ACTION: Issuing a directive to theCommissioner of Customs amendingvisa requirements.

EFFECTIVE DATE: February 1, 1995.FOR FURTHER INFORMATION CONTACT: RossArnold, International Trade Specialist,Office of Textiles and Apparel, U.S.Department of Commerce, (202) 482–4212.

SUPPLEMENTARY INFORMATION:Authority: Executive Order 11651 of March

3, 1972, as amended; section 204 of theAgricultural Act of 1956, as amended (7U.S.C. 1854).

The existing export visa arrangementbetween the Governments of the UnitedStates and the People’s Republic ofBangladesh is being amended to includethe coverage of merged Categories 352/652 for goods produced ormanufactured in Bangladesh andexported from Bangladesh on and afterFebruary 1, 1995.

A description of the textile andapparel categories in terms of HTSnumbers is available in theCORRELATION: Textile and ApparelCategories with the Harmonized TariffSchedule of the United States (seeFederal Register notice 59 FR 65531,published on December 20, 1994). Alsosee 53 FR 46484, published November17, 1988.Rita D. Hayes,Chairman, Committee for the Implementationof Textile Agreements.

Committee for the Implementation of TextileAgreementsJanuary 24, 1995.Commissioner of Customs,Department of the Treasury, Washington, DC

20229.Dear Commissioner: This directive

amends, but does not cancel, the directiveissued to you on November 14, 1988, by theChairman, Committee for the Implementationof Textile Agreements. That directivedirected you to prohibit entry of certaincotton and man-made fiber textile products,produced or manufactured in Bangladesh forwhich the Government of the People’sRepublic of Bangladesh has not issued anappropriate visa.

Effective on February 1, 1995, you aredirected to amend further the November 14,1988 directive to include the coverage ofmerged Categories 352/652 for goodsproduced or manufactured in Bangladesh

and exported from Bangladesh on and afterFebruary 1, 1995. Merchandise in Categories352/652 may be accompanied by either theappropriate merged categories or the correctcategory corresponding to the actualshipment.

Merchandise in Categories 352 and 652which is exported from Bangladesh prior toFebruary 1, 1995 shall not be denied entry ifaccompanied by a merged category 352/652visa.

Shipments entered or withdrawn fromwarehouse according to this directive whichare not accompanied by an appropriateexport visa shall be denied entry and a newvisa must be obtained.

The Committee for the Implementation ofTextile Agreements has determined that thisaction falls within the foreign affairsexception to the rulemaking provisions of 5U.S.C. 553(a)(1).

Sincerely,Rita D. Hayes,Chairman, Committee for the Implementationof Textile Agreements.[FR Doc. 95–2101 Filed 1–26–95; 8:45 am]BILLING CODE 3510–DR–F

COMMITTEE FOR PURCHASE FROMPEOPLE WHO ARE BLIND ORSEVERELY DISABLEDProcurement List; Proposed AdditionsAGENCY: Committee for Purchase FromPeople Who Are Blind or SeverelyDisabled.ACTION: Proposed additions toProcurement List.

SUMMARY: The Committee has receivedproposals to add to the Procurement Lista commodity and services to befurnished by nonprofit agenciesemploying persons who are blind orhave other severe disabilities.COMMENTS MUST BE RECEIVED ON ORBEFORE: February 27, 1995.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 commodity and serviceslisted below from nonprofit agenciesemploying persons who are blind orhave other severe disabilities.


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 thecommodity and services to theGovernment.

2. The action does not appear to havea severe economic impact on currentcontractors for the commodity andservices.

3. The action will result inauthorizing small entities to furnish thecommodity and services to theGovernment.

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 commodity andservices proposed for addition to theProcurement List. Comments on thiscertification are invited. Commentersshould identify the statement(s)underlying the certification on whichthey are providing additionalinformation.

The following commodity andservices have been proposed foraddition to Procurement List forproduction by the nonprofit agencieslisted:

Commodity

Pad, Scouring7920–00–045–2940

NPA: Beacon Lighthouse, Inc.,Wichita Falls, Texas

Services

Grounds Maintenance(Basewide except Quarters and

Common Areas) Fort Sam Houston,Texas

NPA: Goodwill Industries of SanAntonio, San Antonio, Texas

Mailroom Operation & AdministrativeSupport, Department of VeteransAffairs Medical Center, 718 SmythRoad, Manchester, New Hampshire

NPA: Easter Seal Society of NewHampshire, Manchester, NewHampshire

Operation of the Postal Service Center,Building 20204 and 926, KirtlandAir Force Base, New Mexico

NPA: RCI, Inc., Albuquerque, NewMexico

Recycling Service, Patrick Air ForceBase, Florida

NPA: Brevard Achievement Center,

Inc., Rockledge, FloridaBeverly L. Milkman,Executive Director.[FR Doc. 95–2084 Filed 1–26–95; 8:45 am]BILLING CODE 6820–33–P

COMPETITIVENESS POLICY COUNCIL

Meeting

ACTION: Notice of forthcoming meeting.

SUMMARY: In accordance with theFederal Advisory Committee Act, PublicLaw 92–463, as amended, theCompetitiveness Policy Councilannounces a forthcoming meeting.

Dates: February 3; 9:30 a.m. to 3:00 p.m.Address: Third Floor, 1726 M Street, NW.,

Suite 300, Washington, DC 20036.For further information contact: Howard

Rosen, Executive Director, CompetitivenessPolicy Council, Suite 300, 1726 M Street,NW., Washington, DC 20036, (202) 632–1307.

Supplementary information: TheCompetitiveness Policy Council (CPC) wasestablished by the Competitiveness PolicyCouncil Act, as contained in the Trade andCompetitiveness Act of 1988, Public Law100–418, sections 5201–5210, as amended bythe Customs and Trade Act of 1990, PublicLaw 101–382, section 133. The CPC iscomposed of 12 members and is to advise thePresident and Congress on mattersconcerning competitiveness of the USeconomy. The Council’s chairman, Dr. C.Fred Bergsten, will chair the meeting.

The meeting will be open to the publicsubject to the seating capacity of the room.Visitors will be requested to sign a visitor’sregister.

Type of meeting: Open.Agenda: The Council will discuss its FY

1995 workplan and consider additionalbusiness as suggested by its members.

Dated: January 23, 1995.Dr. C. Fred Bergsten,Chairman, Competitiveness Policy Council.[FR Doc. 95–2069 Filed 1–26–95; 8:45 am]BILLING CODE 4739–54–M

DEPARTMENT OF EDUCATION

Arbitration Panel Decision Under theRandolph-Sheppard Act

AGENCY: Department of Education.ACTION: Notice of arbitration paneldecision under the Randolph-SheppardAct.

SUMMARY: Notice is hereby given that onMay 1, 1992, an arbitration panelrendered a decision in the matter ofGarnette Laurell v. MichiganCommission for the Blind, (Docket No.R–S/90–1). This panel was convened bythe Secretary of Education pursuant to20 U.S.C. 107d–1(a), upon receipt of a

complaint filed by petitioner, GarnetteLaurell, on February 12, 1990. TheRandolph-Sheppard Act (the Act)provides a priority for blind individualsto operate vending facilities on Federalproperty. Under this section of the Act,a blind licensee, dissatisfied with theState’s operation or administration ofthe vending facility program authorizedunder the Act, may request a fullevidentiary fair hearing from the Statelicensing agency (SLA). If the licensee isdissatisfied with the results of thehearing, the licensee may complain tothe Secretary of Education, who then isrequired to convene an arbitration panelto resolve the dispute.FOR FURTHER INFORMATION CONTACT: Acopy of the full text of the arbitrationpanel decision may be obtained fromGeorge F. Arsnow, U.S. Department ofEducation, 600 Independence Avenue,SW., room 3230, Switzer Building,Washington, DC 20202–2738.Telephone: (202) 205–9317. Individualswho use a telecommunications devicefor the deaf (TDD) may call the TDDnumber at (202) 205–8298.SUPPLEMENTARY INFORMATION: Pursuantto the Randolph-Sheppard Act (20U.S.C. 107d–2(c)), the Secretarypublishes a synopsis of an arbitrationpanel decision in the Federal Register.

Background

The complainant, Garnette Laurell, isa blind vendor licensed by therespondent, the Michigan Commissionfor the Blind, pursuant to the Randolph-Sheppard Act, 20 U.S.C. 107 et seq. TheMichigan Commission for the Blind (theCommission) is the SLA responsible forthe Michigan vending facility programfor blind individuals.

In late 1985, the Commission locatedan opportunity to take over a canteenfacility at the United States Post OfficeBulk Mail Center in Allen Park,Michigan. The Postal Service stipulatedthat the SLA needed to begin operatingthe vending facility within 30 days of itsoffer or the location would be open tocontracting. The SLA determined that itwas necessary to act quickly to get oneof its licensees into the facility andactivated its bidding procedures. Thecomplainant, Garnette Laurell, was thesuccessful bidder and began operating avending facility at the Bulk Mail Centeron January 6, 1986.

The Commission provided Ms.Laurell with a microwave, moneychanging equipment, and an initialmerchandise inventory. However, as acondition of managing the facility, thecomplainant was required by the SLA toenter into a lease agreement withCanteen Food and Vending Service, the


predecessor operator, for 10 pieces ofvending equipment necessary to theoperation of the facility. The leaserequired monthly payments of $489.00for 60 months. In 1988 the monthlypayments were increased to $514.00with the lease arrangement ending inMay 1989, when the equipment waspurchased by the SLA. The leasepayments totaled $19,568.00. During thesame period of time that complainantwas remitting lease payments, Ms.Laurell also paid the SLA the uniformset-aside fee of 10 percent of netproceeds.

On March 28, 1989, complainant fileda request for an evidentiary hearing withthe SLA, stating that she had beenunjustly required to pay a lease fee forher equipment and asking for fullreimbursement. The hearing was heldon August 22, 1989, before a MichiganDepartment of Labor AdministrativeLaw Judge (ALJ). The ALJ issued aproposed decision on October 16, 1989,affirming the SLA’s actions. The SLAconcurred and in a letter to thecomplainant dated November 9, 1989,declared that the ALJ’s decision wasfinal agency action.

Subsequently, Ms. Laurell filed arequest with the Secretary of Educationto convene an arbitration panel seekinga review of the final action. Thearbitration hearing was held on January6, 1992. It was agreed between theparties that the following issues wouldbe reviewed: (1) Did the Commissionhave a legal responsibility to provideGarnette Laurell with the equipmentthat she was required to lease at theAllen Park Bulk Mail Center? (2) If so,was the Commission legally obligated toreimburse complainant for the cost ofthat leasing? (3) If so, was theCommission legally obligated to payinterest on the reimbursed funds? and(4) Was the Commission obligated topay complainant’s attorney’s fees?

Arbitration Panel DecisionThe arbitration panel ruled that the

Commission had a legal responsibilityto provide equipment to complainantpursuant to the Act, 20 U.S.C. 107b,which states in relevant part that theSLA is required ‘‘to provide for eachlicense blind person such vendingfacility equipment * * * as may benecessary.’’ This requirement is alsoreflected in the Federal regulations in 34CFR 395.3(a)(5) and 395.6(a). Inaddition, the SLA’s statute (Michigan,Section 4(2) of Act No. 260 of theMichigan Public Acts of 1978, (MCL393.351)) states that the Commission‘‘shall * * * (1) Aid individual visuallyhandicapped persons or groups ofvisually handicapped persons to engage

in gainful occupations by furnishing* * * equipment * * * as necessary toencourage and equip them to reachobjectives established with them by theCommission.’’

However, the panel majorityconcluded that there is a distinctionbetween providing equipment andproviding it without cost.While section107b of the Act requires SLAs to agreeto provide the necessary equipment, itexpressly permits ownership interest inthe equipment to reside with either theSLA or the blind licensee. The panelconcluded that the Act did notcontemplate that the blind licenseewould acquire that ownership through agift from the State agency, because theAct expressly anticipates that the Stateagency will pay the blind licensee fairvalue in the event that the SLA choosesto exercise its right to acquire theownership interest. Further,§ 395.3(a)(5) of the Federal regulationssuggests that the obligation to provideequipment can be satisfied by ‘‘makingsuitable vending facility equipmentavailable to a vendor’’ (emphasisadded).

The panel reasoned that this alsocould include providing equipment to avendor by means of a ‘‘lease’’arrangement. To support this conceptthe panel also considered Act No. 260of the Michigan Public Acts of 1978. R393.105 of the Michigan Rules statesthat the Michigan Commission for theBlind shall furnish equipment to thevendor. Specifically, the panelconsidered language in R393.101(k)(viii), which gives thedefinition of operating costs to vendors.The definition states that operating costsmay include renting or leasingCommission-approved equipment orlocation. Therefore, the panel concludedthat it is quite unlikely that Michiganintended its requirement to precludecost to the blind licensee when theFederal authorities did not intend theirrequirement to preclude cost to theblind licensee.

Regarding the complainant’s concernabout paying set-aside fees while shewas paying lease payments onequipment, the panel determined thatsection 107b(3) of the Act and 34 CFR395.9(a) of the Federal regulationsindicate that the determination of thereasonableness of a set-aside fee is afunction of the Secretary of Education.The Secretary did not make adetermination of unreasonableness withrespect to the Commission’s uniformset-aside fee. Furthermore, the panelconcluded that while complainant’s set-aside fee was the uniform 10 percent ofnet proceeds, the dollar amount of herset-aside fee was in fact somewhat

reduced as a result of the deduction ofher lease payments in the calculation ofher net proceeds.

Accordingly, the panel found that theCommission did not have a legalresponsibility to provide thecomplainant, without cost to her, theequipment that she was required tolease at the Bulk Mail Center in AllenPark, Michigan, during the period ofJanuary 1986 to May 1989 and that,therefore, it is not legally obligated toreimburse her for the cost of thatleasing.

In addition, the panel found thatcomplainant’s requests for interest andattorney’s fees were without merit.

One panel member dissented.The views and opinions expressed by

the panel do not necessarily representthe views and opinions of the U.S.Department of Education.

Dated: January 23, 1995.Judith E. Heumann,Assistant Secretary for Special Education andRehabilitative Services.[FR Doc. 95–2066 Filed 1–26–95; 8:45 am]BILLING CODE 4000–01–M

DEPARTMENT OF ENERGY

Withdrawal of Notice of Intent toPrepare Environmental ImpactStatement for East Fork Poplar CreekRemedial Action Project at the OakRidge Reservation, Oak Ridge, TN

AGENCY: Department of Energy.ACTION: Notice.

SUMMARY: The U.S. Department ofEnergy today withdraws its Notice ofIntent (53 FR 46648, November 18,1988) to prepare an EnvironmentalImpact Statement for the East ForkPoplar Creek Remedial Action Project.The Department intends to rely uponthe Comprehensive EnvironmentalResponse, Compensation, and LiabilityAct (CERCLA) process, which willincorporate National EnvironmentalPolicy Act (NEPA) values, to documentits environmental review of actions tobe taken in connection with this project.FOR FURTHER INFORMATION CONTACT: Forfurther information on the East ForkPoplar Creek Remedial Action Project,please contact:Mr. Robert C. Sleeman, Director,

Environmental Restoration Division,Oak Ridge Operations Office, U.S.Department of Energy, P.O. Box 2001,Oak Ridge, TN 37831, (615) 576–0715For information on the Department of

Energy’s NEPA process, please contact:Ms. Carol Borgstrom, Director, Office of

NEPA Oversight, U.S. Department of


Energy, 1000 Independence Avenue,S.W., Washington, D.C. 20585, (202)586–4600 or leave a message at (800)472–2756

SUPPLEMENTARY INFORMATION: The EastFork Poplar Creek Remedial ActionProject was initiated under the ResourceConservation and Recovery Act’s(RCRA) off-site release provisions. Theproject was later incorporated into theCERCLA program when the Oak RidgeReservation was determined to be aNational Priorities List site in December1989.

This project involves an operable unitconsisting of 14.2 miles of the lowerportion of East Fork Poplar Creek (i.e.,the portion of the creek from the pointit exits the Y–12 Plant until itsconfluence with Poplar Creek). Theoperable unit includes the creek, creeksediments, the soils in the 100-yearfloodplain surrounding the creek, andthe Oak Ridge Sewerline Beltway.

On November 18, 1988, theDepartment of Energy published in theFederal Register a Notice of Intent toprepare an Environmental ImpactStatement for the East Fork Poplar CreekRemedial Action Project. At the time ofthe Notice, it was the Department’spolicy to integrate the CERCLA andNEPA processes, whenever practicable.Under that policy, the Departmentintended to prepare an integratedCERCLA/NEPA Remedial Investigation/Feasibility Study-Environmental ImpactStatement for the project. As stated inthe Secretary of Energy’s June 13, 1994,Policy Statement on NEPA, however, itis now the Department’s policy togenerally rely on the CERCLA processfor the review of actions to be takenunder CERCLA, and to incorporateNEPA values (e.g., analysis ofcumulative, off-site, ecological, andsocioeconomic impacts) in theDepartment’s CERCLA documents to theextent practicable.

To date, the public has beenextensively involved in the East ForkPoplar Creek Remedial Action Project.Numerous meetings have been heldwith private property owners andinterested citizens. A property ownerworkshop and a general publicworkshop were held on the RemedialInvestigation report, and a volunteer 30-person Citizens Working Group formedin June 1993, continues to meet monthlyand provides input and suggestions intothe decision-making process.

Discussions have been held with theArmy Corps of Engineers, the Fish andWildlife Service, the EnvironmentalProtection Agency, the TennesseeDepartment of Environment andConservation, the Citizens Working

Group, and other interested partiesregarding the Department’s intent to relyon the CERCLA process to document itsenvironmental review of actions for thisproject. In addition, a notice was placedin a local newspaper and letters weresent to approximately 300 stakeholderssoliciting input on the proposedwithdrawal of the Notice of Intent; noobjections were received. Thus, theDepartment of Energy has decided torely on the CERCLA process todocument its environmental review ofactions to be taken under CERCLA forthe East Fork Poplar Creek RemedialAction Project, with NEPA valuesincorporated into the CERCLA processto the extent practicable. Publicinvolvement has been and will continueto be an integral part of the decision-making process for the project.

Copies of documents related to theEast Fork Poplar Creek Remedial Actionproject are on file at, and may beobtained from, the Information ResourceCenter, 105 Broadway, Oak Ridge,Tennessee 37830.

Issued in Washington, DC, on January 23,1995.Thomas P. Grumbly,Assistant Secretary for EnvironmentalManagement.[FR Doc. 95–2099 Filed 1–26–95; 8:45 am]BILLING CODE 6450–01–P

Federal Energy RegulatoryCommission

[Docket No. ER94–478–000, et al.]

Medina Power Company, et al.; ElectricRate and Corporate Regulation Filings

January 20, 1995.

Take notice that the following filingshave been made with the Commission:

1. Medina Power Company

[Docket No. ER94–478–000]

Take notice that on January 9, 1995,Medina Power Company tendered forfiling an amendment in the above-referenced docket.

Comment date: February 3, 1995, inaccordance with Standard Paragraph Eat the end of this notice.

2. Cincinnati Gas & Electric Company

[Docket No. ER94–1223–000]

Take notice that on January 5, 1995,Cincinnati Gas & Electric Companytendered for filing an amendment in theabove-referenced docket.


3. JEB Corporation

[Docket No. ER94–1432–002]

Take notice that on January 5, 1995,JEB Corporation (JEB), filed certaininformation as required by theCommission’s September 8, 1994, letterorder in Docket No. ER94–1432–000.Copies of JEB’s informational filing areon file with the Commission and areavailable for public inspection.

4. Louisville Gas and Electric Company

[Docket No. ER94–1480–000]

Take notice that on December 23,1994, Louisville Gas and ElectricCompany (LG&E), tendered for filing anamendment to Supplement No. 8 to theInterconnection Agreement betweenLG&E and East Kentucky PowerCooperative, Inc. (EKPC).

The purpose of this filing is to amendService Schedule E, Section 3—Compensation. Section 3 is revised toreflect updated pricing and to introducea tiered pricing structure related toindividual generating units.

A copy of the filing was served uponthe Kentucky Public ServiceCommission.


5. Citizens Utilities Company

[Docket No. ER94–1561–000]

Take notice that on January 17, 1995,Citizens Utilities Company (Citizens),tendered its filing in response to adeficiency letter issued earlier in thisproceeding. Citizens characterizes itsfiling as an amendment to its earlierfiling in this docket.


6. Kentucky Utilities Company

[Docket No. ER94–1698–002]

Take notice that on December 30,1994, Kentucky Utilities Companytendered for filing its compliance filingin the above-referenced docket.


7. J. Aron & Company


Take notice that on January 11, 1995,J. Aron & Company, tendered for filingan amendment in the above referenceddocket.



8. Indianapolis Power & Light Company


Take notice that on January 9, 1995,Indianapolis Power & Light Companytendered for filing an amendment to itsprevious filing in the above-referenceddocket. The amendment consists of arevised Service Schedule submitted inresponse to a staff request.

IPL requests that the effective dateremain sixty (60) days from the originalfiling date of October 21, 1994.

Copies of this filing were sent to theIndiana Municipal Power Agency andthe Indiana Utility RegulatoryCommission.


9. Mid-American Resources, Inc.


Take notice that on January 17, 1995,Mid-American Resources, Inc. tenderedfor filing additional information in theabove-referenced docket.


10. Allegheny Power ServiceCorporation on behalf of MonongahelaPower Company, The Potomac EdisonCompany and West Penn PowerCompany (The APS Companies or APS)


Take notice that on December 23,1994, Allegheny Power ServiceCorporation on behalf of MonongahelaPower Company, The Potomac EdisonCompany and West Penn PowerCompany (the APS Companies or APS)filed a letter agreeing to conform theStandard Generation Service RateSchedule filed in this docket to therequirements of Docket No. PL95–1–000regarding ratemaking procedures foremission allowances. Allegheny PowerService Corporation requests waiver ofnotice requirements and asks theCommission to honor the January 1,1995, effective date determined by thedate of the original filing.

Copies of the filing have beenprovided to the Public UtilitiesCommission of Ohio, the PennsylvaniaPublic Utility Commission, theMaryland Public Service Commission,the Virginia State CorporationCommission, the West Virginia PublicService Commission, and all parties ofrecord.


11. Howard Energy Company, Inc.


Take notice that on January 19, 1995,Howard Energy Company, Inc. tenderedfor filing an amendment in the above-referenced docket.


12. Public Service Company of NewHampshire


Take notice that on January 11, 1995,Public Service Company of NewHampshire tendered for filing anamendment in the above-referenceddocket.


13. Niagara Mohawk PowerCorporation


Take notice that on January 5, 1995,Niagara Mohawk Power Corporation(Niagara), tendered for filing a ServiceAgreement between Niagara and theCity of Jamestown, New York underNiagara’s FERC Electric Tariff OriginalVolume No. 2.


14. American Electric Power ServiceCorporation


Take notice that on January 11, 1995,the American Electric Power ServiceCorporation (AEPSC), amended its filingin the above referenced Docket torequest the earliest permissible effectivedate.

A copy of the filing was served uponthe parties affected by the amendmentand the affected state regulatorycommissions for the states of Ohio,Indiana, Michigan, Virginia, WestVirginia, Kentucky, and Tennessee.


15. Southern California EdisonCompany


Take notice that on January 10, 1995,Southern California Edison Company,tendered for filing a Notice ofCancellation of FERC Rate Schedule No.246.3 and FERC Rate Schedule No.246.4 and supplements thereto.


16. Southern California EdisonCompany

[Docket No. ER95–410–000]Take notice that on January 10, 1995,

Southern California Edison Companytendered for filing a Notice ofCancellation of FERC Rate Schedule No.246.22, FERC Rate Schedule No. 246.23and FERC Rate Schedule No. 246.24 andsupplements thereto.


17. Dayton Power and Light Company

[Docket No. ER95–413–000]Take notice that Dayton Power and

Light Company (Dayton), tendered forfiling on January 10, 1995, executedPower and Transmission Agreement(PTA) between Dayton and The City ofCelina, Ohio (Celina).

Pursuant to Rate Schedule A throughC attached to the PTA, DP&L willprovide to Celina, on an unbundledbasis, firm and limited term firm powersupplies and firm transmission service,all subject to flexible provisions andfixed long-term prices. Dayton andCelina are currently parties to a ServiceAgreement for Partial RequirementsService pursuant to Dayton’s FERCElectric Tariff, Original Volume No. 2,filed pursuant to and governed by theSettlement Agreement accepted forfiling in Docket No. ER83–333–000. TheAgreements will replace the existingPartial Requirements ServiceAgreements in place for Celina. Daytonand Municipals request that thisagreement be made effective for thebilling month of March 1995.

A copy of the filing was served uponThe City of Celina, Ohio and The PublicUtilities Commission of Ohio.


18. Rochester Gas and ElectricCompany


Rochester Gas and Electric Company(RG&E), tendered for filing a ServiceAgreement between RG&E and LouisDreyfus Electric Power Inc.


Standard Paragraphs

E. Any person 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 accordance


with 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. 95–2021 Filed 1–26–95; 8:45 am]BILLING CODE 6717–01–P

[Docket No. EL93–53–000, et al.]

Southwestern Public ServiceCompany, et al.; Electric Rate andCorporate Regulation Filings

January 23, 1995.Take notice that the following filings

have been made with the Commission:

1. Southwestern Public ServiceCompany

[Docket No. EL93–53–000]

Take notice that on December 12,1994, Southwestern Public ServiceCompany tendered for filing additionalinformation in the above-referenceddocket.


2. Indianapolis Power & Light Company

[Docket No. ER94–1433–000]

Take notice that on January 13, 1995,Indianapolis Power & Light Companytendered for filing an amendment in theabove-referenced docket.


3. New England Power Company


Take notice that New England PowerCompany (NEP), on December 28, 1994,tendered for filing a clarification to thefiling letter initially tendered in thisdocket.


4. Pennsylvania Power Company


Take notice that on January 12, 1995,Pennsylvania Power Company tendered

for filing an amendment in the above-referenced docket.


5. Westcoast Power Marketing Inc.


Westcoast Power Marketing Inc.(Westcoast Power) tendered for filing apetition for waivers and blanketapprovals under various regulations ofthe Commission and for an orderaccepting its FERC Electric RateSchedule No. 1.

Westcoast Power states that it intendsto engage in electric power and energytransactions as a marketer and a broker.In transactions where Westcoast Powersells electric energy, it proposes to makesuch sales on rates, terms andconditions to be mutually agreed to withthe purchasing party. Westcoast Powerstates that neither it nor any of itsaffiliates is in the business of generating,transmitting or distributing electricpower in the United States. WestcoastPower further states that certain of itsaffiliates are engaged in electrictransmission and independent powergeneration projects in Canada. Affiliatesof Westcoast Power are also engaged inthe transportation, distribution andmarketing of natural gas, it is stated.

Rate Schedule No. 1 provides for thesale of energy and capacity at agreedprices. Rate Schedule No. 1 alsoprovides that no sales may be made toaffiliates.


6. The Toledo Edison Company


The Toledo Edison Company (ToledoEdison) tendered for filing a revision tothe Resale Service Rate Agreementbetween Toledo Edison andSoutheastern Michigan Rural ElectricCooperative (Southeastern Michigan),which was effective for service renderedby Toledo Edison to SoutheasternMichigan from January 1, 1995.

Toledo Edison states thatSoutheastern Michigan presentlypurchases firm power under its FERCElectric Tariff No. 33 which terminatesunder its own provision on December31, 1994. Under the Resale Service RateAgreement, Toledo Edison will continueto sell to Southeastern Michigan all ofthe power and energy needed bySoutheastern Michigan to serve itsrequirements.

Toledo Edison states that the rate setforth in the Resale Service Rate

Agreement is a negotiated rate betweenToledo Edison and SoutheasternMichigan. Toledo Edison states that theResale Service Rate Agreement will helpSoutheastern Michigan becomecompetitive in its source of power.


7. Cambridge Electric Light Company,Commonwealth Electric Company, NewEngland Power Company


Take notice that on January 9, 1995,Cambridge Electric Light Company,Commonwealth Electric Company andNew England Power Company tenderedfor filing, proposed changes in theirrespective rate schedules, FERC No. 35,FERC No. 28 and FERC No. 387, toreplace a discontinued price index.


8. Gulf States Utilities Company


Take notice that Gulf States UtilitiesCompany (Gulf States), on January 10,1995, tendered for filing proposedchanges in its Power InterconnectionAgreement with Cajun Electric PowerCooperative, Inc. (Cajun), Rate ScheduleFERC No. 128. Gulf States proposes toadd a new Section 5.6 to theinterconnection agreement. Theproposed change provides that GulfStates may, pursuant to § 35.15 of theCommission’s regulations, 18 CFR35.15, file to cancel service schedules orsuspend service to Cajun, in the eventCajun fails to pay any sum due forservice.


9. The Dayton Power and LightCompany


Take notice that The Dayton Powerand Light Company (Dayton) tenderedfor filing on January 10, 1995, executedPower Service Agreements (PSA)between Dayton and The Village ofEldorado, The Village of Minster, TheCity of Tipp City, The Village ofVersailles, and The Village of YellowSprings, Ohio (Municipals).

Pursuant to Rate Schedules A throughE attached to the PSA, DP&L willprovide to Municipals, on an unbundledbasis, long-term firm and short-terminterruptible transmission services anda variety of power supply services, allsubject to flexible notice and schedulingprovisions and fixed long-term prices.


Dayton and Municipals are currentlyparties to a Service Agreement forpartial requirements service pursuant toDayton’s FERC Electric Tariff, OriginalVolume No. 2, filed pursuant to andgoverned by the Settlement Agreementaccepted for filing in Docket No. ER83–333–000. The Agreements will replacethe existing Partial RequirementsService Agreements in place for thesemunicipals. Dayton and Municipalsrequest an effective date of January 1,1995.

A copy of the filing was served uponThe Village of Eldorado, The Village ofMinster, The City of Tipp City, TheVillage of Versailles, and The Village ofYellow Springs, Ohio and The PublicUtilities Commission of Ohio.


10. Virginia Electric and PowerCompany


Take notice that on January 10, 1995,Virginia Electric and Power Company(Virginia Power) tendered for filing aService Agreement between LouisDreyfus Electric Power Inc. and VirginiaPower, dated January 1, 1995, under thePower Sales Tariff to Eligible Purchasersdated May 27, 1994. Under the tenderedService Agreement Virginia Poweragrees to provide services to AES Power,Inc. under the rates, terms andconditions of the Power Sales Tariff asagreed by the parties pursuant to theterms of the applicable ServiceSchedules included in the Power SalesTariff.

Copies of the filing were served uponthe Virginia State CorporationCommission and the North CarolinaUtilities Commission.


11. San Diego Gas & Electric Company


Take notice that on January 12, 1995,San Diego Gas & Electric Company(SDG&E) tendered for filing a Notice ofCancellation of FERC Rate Schedule No.84 between SDG&E and the City ofVernon.


12. Rochester Gas and ElectricCorporation


Take notice that Rochester Gas andElectric Corporation (RG&E), on January12, 1995, tendered for filing a Service

Agreement for acceptance by theFederal Energy Regulatory Commission(Commission) between RG&E and LouisDreyfus Electric Power Inc. The termsand conditions of service under thisAgreement are made pursuant to RG&E’sFERC Electric Rate Schedule, OriginalVolume 1 (Power Sales Tariff) acceptedby the Commission in Docket No. ER94–1279. RG&E also has requested waiver ofthe 60-day notice provision pursuant to18 CFR 35.11.

A copy of this filing has been servedon the Public Service Commission of theState of New York.


13. Delmarva Power and LightCompany

[Docket No. FA92–39–001]Take notice that on January 10, 1995,

Delmarva Power and Light Companytendered for filing its compliance refundreport in the above-referenced docket.


Standard Paragraphs

E. Any person 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 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. 95–2047 Filed 1–26–95; 8:45 am]BILLING CODE 6717–01–P

[Project No. 1930–014]

Southern California Edison Company(Kern River No. 1 HydroelectricProject; Intent to ConductEnvironmental Scoping Meetings andSite Visit

January 23, 1995.The Federal Energy Regulatory

Commission (FERC or Commission) has

received an application for a newlicense for the Kern River No. 1Hydroelectric Project, Project No. 1930–014. The Kern River No. 1 HydroelectricProject is located on the Kern River,about 17 miles northeast of Bakersfieldand 16 miles southwest of Bodfish, inKern County, California. The projectoccupies lands within the SequoiaNational Forest, administered by theU.S. Forest Service (FS).

The Commission and FS staffs (staff)intend to prepare a joint EnvironmentalAssessment (EA) on this hydroelectricproject in accordance with the NationalEnvironmental Policy Act.

In the EA, we will consider both site-specific and cumulative environmentalimpacts of the project and reasonablealternatives, and will include aneconomic, financial, and engineeringanalysis.

The draft EA will be issued andcirculated for review by all interestedparties. All comments filed on the draftEA will be analyzed by the staff andconsidered in a final EA. The staff’sconclusions and recommendations willthen be presented for the considerationby the Commission in reaching its finallicensing decision.

Scoping MeetingsStaff will hold two scoping meetings.

A scoping meeting oriented towards thepublic will be held on Tuesday, March7, 1995, at 6:30 PM, at the City ofBakersfield City Hall, 1501 TruxtunAvenue, Bakersfield, California. Ascoping meeting oriented towards theagencies will be held on Wednesday,March 8, 1995, at 9:00 AM, at theBureau of Land Management offices,3801 Pegasus Drive, Bakersfield,California.

Interested individuals, organizations,and agencies are invited to attend eitheror both meetings and assist the staff inidentifying the scope of environmentalissues that should be analyzed in theEA.

To help focus discussions at themeetings, a scoping document outliningsubject areas to be addressed in the EAwill be mailed to agencies andinterested individuals on theCommission mailing list. Copies of thescoping document will also be availableat the scoping meetings.

ObjectivesAt the scoping meetings the staff will:

(1) Identify preliminary environmentalissues related to the proposed project;(2) identify preliminary resource issuesthat are not important and do notrequire detailed analysis; (3) identifyreasonable alternatives to be addressedin the EA; (4) solicit from the meeting


participants all available information,especially quantified data, on theresources issues; and (5) encouragestatements from experts and the publicon issues that should be analyzed in theEA, including points of view inopposition to, or in support of, thestaff’s preliminary views.

ProceduresThe scoping meetings will be

recorded by a court reporter and allstatements (oral and written) willbecome part of the formal record of theCommission proceedings on the KernRiver No. 1 Hydroelectric Project.Individuals presenting statements at themeetings will be asked to clearlyidentify themselves for the record.

Individuals, organizations, andagencies with environmental expertiseand concerns are encouraged to attendthe meetings and assist the staff indefining and clarifying the issues to beaddressed in the EA.

Persons choosing not to speak at themeetings, but who have views on theissues or information relevant to theissues, may submit written statementsfor inclusion in the public record at themeetings. In addition, written scopingcomments may be filed with Secretary,Federal Energy Regulatory Commission,825 North Capitol Street, NE,Washington, D.C. 20426, until April 10,1995.

All written correspondence shouldclearly show the following caption onthe first page: Kern River No. 1Hydroelectric Project, FERC Project No.1930–014.

Intervenors—those on theCommission’s service list for thisproceeding (parties)—are reminded ofthe Commission’s Rules of Practice andProcedure, requiring parties filingdocuments with the Commission, toserve a copy of the document on eachperson whose name appears on theofficial service list. Further, if a party orinterceder files comments or documentswith the Commission relating to themerits of an issue that may affect theresponsibilities of a particular resourceagency, they must also serve a copy ofthe document on that resource agency.All entities commenting on this scopingdocument must file an original andeight copies of the comments with theSecretary of the Commission.

Site VisitA site visit to the Kern River No. 1

Hydroelectric Project is planned forMarch 7, 1994. Those who wish toattend should plan to meet at 9:00 AMat the US Forest Service, SequoiaNational Forest, Greenhorn RangerDistrict Offices at 15701 Highway 178 in

Bakersfield, California, and shortlythereafter, leave for the project sitelocated about 4 miles away. If you planto attend, contact Mr. Geoff Rabone,Southern California Edison Company,by February 27, 1995, at (818) 302–8951for directions or additional details.

Any questions regarding this noticemay be directed to Mr. David Turner,Environmental Coordinator, FERC, at(202) 219–2844 or Ms. Patty Bates, FS,at (805) 871–2223.Lois D. Cashell,Secretary.[FR Doc. 95–2022 Filed 1–26–95; 8:45 am]BILLING CODE 6717–01–M

[Project Nos. 1930–014, et al.]

Hydroelectric Applications [SouthernCalifornia Edison Company, et al.];Applications

Take notice that the followinghydroelectric applications have beenfiled with the Commission and areavailable for public inspection:

1 a. Type of Application: MajorRelicense.

b. Project No.: 1930–014.c. Date filed: May 2, 1994.d. Applicant: Southern California

Edison Company.e. Name of Project: Kern River No. 1.f. Location: On the Kern River in Kern

County, California, within SequoiaNational Forest.

g. Filed Pursuant to: Federal PowerAct, 16 USC 791(a)–825(r).

h. Applicant Contact: Mr. C. EdwardMiller, Manager of Hydro Generation,Southern California Edison Company,P.O. Box 800, 2244 Walnut GroveAvenue, Rosemead, CA 91770, (818)302–1564.

i. FERC Contact: James Hunter at (202)219–2839.

j. Deadline for filing Interventions andProtests: 60 days from issuance of thisnotice. The Commission’s due date forthe applicant’s filing of a finalamendment of this application isAugust 10, 1995.

k. Status of Environmental Analysis:The application is not ready forenvironmental analysis at this time—seeattached paragraph E1.

l. Description of Project: The existingproject consists of (1) a 60-foot-high,204-foot-long concrete overflowdiversion dam impounding a 27-acrereservoir at crest elevation 1,913 feet,mean sea level; (2) a gated intakestructure at the left abutment with trashracks; (3) a 104-foot-long, 20-foot-widesediment trap; (4) water conduitconsisting of 42,884 feet of tunnel, 390feet of rectangular flume, 904 feet of

Lennon flume on steel structure, and612 feet of arched-concrete conduit; (5)a 45-foot-long, 33-foot-wide, 11-foot-deep forebay; (6) a 1,693-foot-longburied penstock, with inside diametervarying from 108 inches at the intake to71 3/8 inches at the powerhouse; (7) a170-foot-long, 71-foot-wide, reinforcedconcrete powerhouse containing fourgenerating units with a total installedcapacity of 26.3 MW; (8) a rectangulartailrace that discharges flows over aweir section into the Kern River; (9) two1.9-mile-long, 66-kV transmission linestying into the applicant’s transmissionsystem; and (10) appurtenant facilities.

m. Purpose of Project: The Kern RiverNo. 1 project produces an averageannual output of 178.6 GWh. Powergenerated at the project is delivered tocustomers within the applicant’s servicearea.

n. This notice also consists of thefollowing standard paragraphs: B1 andE1.

o. Locations of Application: A copy ofthe application, as amended andsupplemented, is available forinspection and reproduction at theCommission’s Public Reference andFiles Maintenance Branch, located at941 North Capitol Street, N.E., Room3104, Washington, D.C. 20426, or bycalling (202) 208–1371. A copy is alsoavailable for inspection andreproduction at the applicant’s office(see item (h) above).

2 a. Type of Application: ConduitExemption.

b. Project No.: 11503–000.c. Date filed: October 26, 1994.d. Applicant: City of Soda Springs.e. Name of Project: Soda Creek Project

No. 4.f. Location: At the new Kackley Ditch

canal, which diverts water from SodaCreek near the base of Soda dam, inCaribou County, Idaho.

g. Filed Pursuant to: Federal PowerAct, 16 USC 791 (a)–825(r).

h. Applicant Contact: W. Lee Godfrey,Director of City Services, City of SodaSprings, 9 West Second South, SodaSprings, ID 83276.

i. FERC Contact: Hector M. Perez at(202) 219–2843.

j. Status of Environmental Analysis:This application is ready forenvironmental analysis at this time—seeattached paragraph D–4.

k. Comment Date: March 7, 1995.l. Description of Project: The existing

project consists of: (1) An intakestructure at the main canal; (2) a 42-inch-diameter, 270-feet-long weldedsteel penstock; (3) a powerhousecontaining a single turbine-generatorunit with a rated capacity of 500


kilowatts; and (4) a 100-foot-longtailrace.

m. This notice also consists of thefollowing standard paragraphs: A2, A9,B1, and D4.

n. Available Locations of Application:A copy of the application is available forinspection and reproduction at theCommission’s Public Reference andFiles Maintenance Branch, located at941 North Capitol Street, N.E., Room3104, Washington, D.C. 20426, or bycalling (202) 208–1371. A copy is alsoavailable for inspection andreproduction at the address shown initem h above.

3 a. Type of Application: MinorLicense (Tendered Notice).

b. Project No.: 11512–000.c. Date filed: December 27, 1994.d. Applicant: John H. Bigelow.e. Name of Project: Mckenzie.f. Location: On the Mckenzie River in

Lane County, Oregon, Section 10,Township 16S, Range 6E, WestMeridian.

g. Filed Pursuant to: Federal PowerAct 16 USC 791(a)–825(r).

h. Applicant Contact: Amy Drought,Project Manager, Community PlanningWorkshop, Hendricks Hall, Universityof Oregon, Eugene, OR 97403, (503)346–3653.

i. FERC Contact: Hector M. Perez at(202) 219–2843.

j. The project would consist of: (1) Adiversion dam constructed of large rocksat river mile 73.6; (2) a concreteheadgate; (3) a power canal about 1,500feet long; (4) a 32-foot-long and 5-foot-diameter penstock; (5) a powerhousewith an installed capacity of 76kilowatts; (6) a 30-foot-long tailrace; and(7) other appurtenances.

k. Under Section 4.32 (b)(7) of theCommission’s regulations (18 CFR), ifany resource agency, Indian Tribe, orperson believes that the applicantshould conduct an additional scientificstudy to form an adequate factual basisfor a complete analysis of theapplication on its merits, they must filea request for the study with theCommission, not later than 60 days afterthe application is filed, and must servea copy of the request on the applicant.

4 a. Type of Application: MajorLicense.

b. Project No.: 11175–002.c. Date filed: January 3, 1995.d. Applicant: Crown Hydro Company.e. Name of Project: Crown Mill

Project.f. Location: on the Mississippi River

in Hennepin County, Minnesota.g. Filed Pursuant to: Federal Power

Act 16 U.S.C. 791 (a)–825(r).h. Applicant Contact: Mr. Greg Olsen,

Crown Hydro Company, 5416 Tenth

Avenue South, Minneapolis, MN 55417,(612) 822–2212.

i. FERC Contact: Robert Bell (202)219–2806.

j. Comment Date: 60 days from thefiling date in paragraph c.

k. Description of Project: Theproposed project would the existingU.S. Army Corps of Engineers UpperFalls Dam and consists of:

(1) A proposed headrace canal; (2)two proposed intake tunnels; (3) aproposed powerhouse containing twogenerating units having a total installedcapacity of 3.4–MW; (4) a proposedtailrace tunnel; (5) a proposed tailracecanal; (6) a proposed transmission line;and (7) appurtenant facilities.

l. With this notice, we are initiatingconsultation with the Minnesota STATEHISTORIC PRESERVATION OFFICER(SHOP), as required by section 106,National Historic Preservation Act, andthe regulations of the Advisory Councilon Historic Preservation, 36 CFR 800.4.

m. Pursuant to § 4.32(b)(7) of 18 CFRof the Commission’s regulations, if anyresource agency, Indian Tribe, or personbelieves that an additional scientificstudy should be conducted in order toform an adequate factual basis for acomplete analysis of the application onits merit, the resource agency, IndianTribe, or person must file a request fora study with the Commission not laterthan 60 days from the filing date andserve a copy of the request on theapplicant.


b. Project No.: 11514–000.c. Date filed: January 3, 1995.d. Applicant: Imperial Carving

Company.e. Name of Project: Allegan City

Project.f. Location: on the Kalamazoo River in

Allegan County, Michigan.g. Filed Pursuant to: Federal Power

Act 16 U.S.C. 791 (a)–825(r).h. Applicant Contact: Mr. William E.

Dalman, Imperial Carving Company,Allegan, MI 49010, (616) 673–3867.

i. FERC Contact: Robert Bell (202)219–2806.

j. Comment Date: 60 days from thefiling date in paragraph c.

k. Description of Project: Theproposed project would consist of: (1)An existing 875-foot-long, 10 to 15-foot-high Dam; (2) an impoundment withsurface area of 135-acres having astorage capacity of 1,290 acre-feet and anormal water surface elevation of 627.4feet msl; (3) an existing intake structure;(4) an existing powerhouse with onegenerating unit with an installedcapacity of 800–Kw; (5) the existing

tailrace; (6) existing transmission line;and (7) appurtenant facilities.

l. With this notice, we are initiatingconsultation with the Michigan STATEHISTORIC PRESERVATION OFFICER(SHPO), as required by Section 106,National Historic Preservation Act, andthe regulations of the Advisory Councilon Historic Preservation, 36 CFR 800.4.

m. Pursuant to § 4.32(b)(7) of 18 CFRof the Commission’s regulations, if anyresource agency, Indian Tribe, or personbelieves that an additional scientificstudy should be conducted in order toform an adequate factual basis for acomplete analysis of the application onits merit, the resource agency, IndianTribe, or person must file a request fora study with the Commission not laterthan 60 days from the filing date andserve a copy of the request on theapplicant.

6 a. Type of Application: PreliminaryPermit.

b. Project No.: P–11511–000.c. Date Filed: December 7, 1994.d. Applicant: Hydro Matrix

Partnership, Ltd.e. Name of Project: Uniontown

Project.f. Location: On the Ohio River, Union

County, Kentucky, Gallatin County,Illinois, and Posey County, Indiana.

g. Filed Pursuant to: Federal PowerAct, 16 U.S.C. 791(a)–825(r).

h. Applicant Contact: Mr. James B.Price, Hydro Matrix Partnership, Ltd.,120 Calumet Court, Aiken, SC 19803,(803) 642–2749.

i. FERC Contact: Robert Bell (dt) (202)219–2806.

j. Comment Date: March 23, 1995.k. Description of Project: The

proposed project would utilize theexisting 3,504-foot-long, 20-foot-highUniontown Locks and Dam, owned bythe U. S. Army Corps of Engineers andconsists of: (1) A proposed intakestructure; (2) a proposed powerhousecontaining two generating units havinga total installed capacity of 45,000–Kw;(4) a proposed 2-mile-long, 161–Kvtransmission line; and (5) appurtenantfacilities. The estimated annualgeneration would be 172–Gwh.

l. Purpose of Project: All projectenergy produced would be sold to alocal utility.

m. This notice also consists of thefollowing standard paragraphs: A5, A7,A9, A10, B, C, and D2.

n. Available Location of Application:A copy of the application, as amendedand supplemented, is available forinspection and reproduction at theCommission’s Public Reference andFiles Maintenance Branch, located at941 North Capitol Street, N.E., Room


3104, Washington, D.C., 20426, or bycalling (202) 208–1371. A copy is alsoavailable for inspection andreproduction at Uniontown HydroMatrix Partnership, Ltd., 120 CalumetCourt, Aiken, SC 29803, (803) 642–2749.


b. Project No.: 10819–002.c. Date filed: June 23, 1994.d. Applicant: Idaho Water Resource

Board.e. Name of Project: Dworshak Small

Hydro.f. Location: On the existing water

conveyance system providing waterfrom the Corps of Engineers’ Dworshakdam to Clearwater Fish Hatchery andDworshak National Fish Hatchery, onland owned by the Corps of Engineersand the Bureau of Land Managementwithin the boundary of the Nez PerceIndian Reservation. North ForkClearwater River, Clearwater County,Idaho. Section 34, Township 37 North,Range 1 East, Boise Meridian.

g. Filed Pursuant to: Federal PowerAct, 16 USC §§ 791(a)–825(r).

h. Applicant Contact: Mr. RalphMellin, Idaho Department of WaterResources, 1301 North Orchard, Boise,ID 83706–2237, (208) 327–7991.

i. FERC Contact: James Hunter, (202)219–2839.

j. Deadline Date: Deadline for filingInterventions, Protests, or CompetingApplications (see attached paragraphD8), and also for filing Written ScopingComments [see item (l) below]—March27, 1995.

k. Status of Environmental Analysis:The application is not ready forenvironmental analysis at this time—seeattached paragraph D8.

l. Intent To Prepare An EnvironmentalAssessment And Invitation For WrittenScoping Comments: The Commissionstaff (staff) intends to prepare anEnvironmental Assessment (EA) on thehydroelectric project in accordance withthe National Environmental Policy Act.The EA will objectively considerenvironmental impacts of the projectand reasonable alternatives and willinclude economic, financial, andengineering analyses.

A draft EA will be issued andcirculated for review by all interestedparties. All timely filed comments onthe draft EA will be analyzed by thestaff and considered in the final EA. Thestaff’s conclusions andrecommendations will then bepresented for the Commission’sconsideration in reaching its finallicensing decision.

Scoping: Interested individuals,organizations, and agencies with

environmental expertise are invited toassist the staff in identifying the scopeof environmental issues that should beanalyzed in the EA by submittingwritten scoping comments. To helpfocus those comments, a scopingdocument outlining subject areas to beaddressed in the EA will be mailed toagencies and interested individuals onthe Commission mailing list. Copies ofthe scoping document may also berequested from the staff.

Persons who have views on the issuesor information relevant to the issuesmay submit written statements forinclusion in the public record. Thosewritten comments should be filed withthe Secretary, Federal Energy RegulatoryCommission, 825 North Capitol Street,N.E., Washington, DC, 20426, by thedeadline date shown in item (j) above.All written correspondence shouldclearly show the following caption onthe first page:Dworshak Small Hydro Project, FERC

No. 10819Intervenors are reminded of the

Commission’s Rules of Practice andProcedure requiring parties filingdocuments with the Commission toserve a copy of the document on eachperson whose name appears on theofficial service list. Further, if a party orinterceder files comments or documentswith the Commission relating to themerits of an issue that may affect theresponsibilities of a particular resourceagency, they must also serve a copy ofthe document on that resource agency.

m. Description of Project: Theproposed project would utilize releasesfrom Dworshak dam that are conveyedby pipelines to the fish hatcheries andwould consist of: (1) Connections to theexisting 36-inch and 18-inch watersupply lines; (2) a 58.25-foot-long, 25-foot-wide powerhouse on top of theexisting water distribution structure,containing two generating units withinstalled capacities of 2.0 and 0.5megawatts that would discharge flowsdirectly into the distribution tank; (3) asubstation adjacent to the powerhouse;and (4) an underground 14.4–KV, 1.6-mile-long transmission line connectingto an existing Clearwater PowerCompany distribution line.

n. Purpose of Project: Power generatedat the project will be sold to BonnevillePower Administration.

o. This notice also consists of thefollowing standard paragraphs: A2, A9,B1, and D8.

p. Locations of Application: A copy ofthe application, as amended andsupplemented, is available forinspection and reproduction at theCommission’s Public Reference and

Files Maintenance Branch, located at941 North Capitol Street, N.E., Room3104, Washington, D.C. 20426, or bycalling (202) 208–1371. A copy is alsoavailable for inspection andreproduction at the applicant’s office(see item (h) above).

8 a. Type of Application: PreliminaryPermit.

b. Project No.: 11513–000.c. Date filed: January 3, 1995.d. Applicant: Walter Musa, Jr.e. Name of Project: Canyon Creek

Hydroelectric Project.f. Location: Entirely on private lands,

on Canyon Creek (a tributary of theLewis River) in Clark County,Washington. T5N, R4E in section 5;T6N, R4E in section 32.


h. Applicant Contact: Albert Liou,P.E., Harza Engineering, Inc., 2353130th Avenue NE, suite 200, P.O. BoxC–96900, Bellevue, Washington 98005,(206) 882–2455.

i. FERC Contact: Mr. MichaelStrzelecki, (202) 219–2827.


proposed run-of-river project wouldconsist of: (1) A reinforced concretedrop-inlet structure in Canyon Creek; (2)a 60-inch-diameter, 4,000-foot-long steelpenstock; (3) a powerhouse containingone 2,200–Kw generating unit; (4) a 1-mile-long transmission lineinterconnecting with an existing PacificPower & Light substation at the YaleDam switchyard; and (5) appurtenantfacilities.

l. This notice also consists of thefollowing standard paragraphs: A5, A7,A9, A10, B, C, and D2.

9 a. Type of Application: Declarationof Intention.

b. Docket No: DI95–1–000.c. Date Filed: December 27, 1994.d. Applicant: Donald Greear.e. Name of Project: Greear Micro

Hydro Plant.f. Location: On an unnamed stream,

tributary to Cougar Creek and theWashougal River in Clark County,Washington (T. 2 N., R. 4 E., sec. 13.).

g. Filed Pursuant to: Federal PowerAct, 16 USC Section 791(a)–825(r).

h. Applicant Contact: Mr. Donald W.Greear, 4009 Cardjal Road, Washougal,WA 98671–9547, (206) 837–3776.

i. FERC Contact: Diane M. Murray,(202) 219–2682.


proposed project will consist of: (1) Asmall reservoir; (2) a two-foot-highdiversion dam; (3) a 600-foot-long, 12-inch-diameter penstock; (4) a generating


unit with an installed generatingcapacity of 60 kilowatts; and (5)appurtenant facilities. The excess powerwill be sold to the Public Utility DistrictNo. 1 of Clark County.

When a Declaration of Intention isfiled with the Federal Energy RegulatoryCommission, the Federal Power Actrequires the Commission to investigateand determine if the interests ofinterstate or foreign commerce would beaffected by the project. The Commissionalso determines whether or not theproject: (1) Would be located on anavigable waterway; (2) would occupyor affect public lands or reservations ofthe United States; (3) would utilizesurplus water or water power from agovernment dam; or (4) if applicable,has involved or would involve anyconstruction subsequent to 1935 thatmay have increased or would increasethe project’s head or generatingcapacity, or have otherwise significantlymodified the project’s pre-1935 designor operation.

l. This notice also consists of thefollowing standard paragraphs: B, C1,and D2.

10 a. Type of Application:Preliminary Permit.

b. Project No.: 11515–000.c. Date filed: January 4, 1995.d. Applicant: Dominguez

Hydroelectric Associates.e. Name of Project: Dominguez

Hydroelectric Project.f. Location: Partially on lands

administered by the Bureau of LandManagement, on the Gunnison River, inMesa and Delta Counties, Colorado.T12S, R99W.


h. Applicant Contact: James M. Pike,President, Western States Water &Power, Inc., 2384 South Kingston Street,Aurora, Colorado 80014, (303) 337–5599.

i. FERC Contact: Mr. MichaelStrzelecki, (202) 219–2827.


proposed combination pumped-storage/run-of-river project would consist of: (1)A 250-foot-high concrete dam on theGunnison River with a 36–MWpowerhouse integral with that dam; (2)a 38,000-acre lower reservoir(Dominguez Reservoir) formed by thatdam; (3) a 230-foot-high dam on a mesaabove the Gunnison River forming anupper reservoir of unspecified surfacearea (Rim Basin Reservoir); (4) a 1,000-foot-long penstock connecting the tworeservoirs; (6) an undergroundpowerhouse along the penstock routecontaining eight generating units with a

total installed capacity of 1,000 MW; (7)a 1-mile-long transmission lineinterconnecting with an existing 345-kVtransmission line; and (8) appurtenantfacilities. None of the facilities areexisting.

The project is located near an areabeing studied by the U.S. Department ofthe Interior for inclusion as a wildlifestudy area.

No new roads will be needed toconduct the studies.

l. This notice also consists of thefollowing standard paragraphs: A5, A7,A9, A10, B, C, and D2.

Standard ParagraphsA2. Development Application—Any

qualified applicant desiring to file acompeting application must submit tothe Commission, on or before thespecified deadline date for theparticular application, a competingdevelopment application, or a notice ofintent to file such an application.Submission of a timely notice of intentallows an interested person to file thecompeting development application nolater than 120 days after the specifieddeadline date for the particularapplication. Applications forpreliminary permits will not beaccepted in response to this notice.

A5. Preliminary Permit—Anyonedesiring to file a competing applicationfor preliminary permit for a proposedproject must submit the competingapplication itself, or a notice of intent tofile such an application, to theCommission on or before the specifiedcomment date for the particularapplication (see 18 CFR 4.36).Submission of a timely notice of intentallows an interested person to file thecompeting preliminary permitapplication no later than 30 days afterthe specified comment date for theparticular application. A competingpreliminary permit application mustconform with 18 CFR 4.30(b)(1) and (9)and 4.36.

A7. Preliminary Permit—Anyqualified development applicantdesiring to file a competingdevelopment application must submit tothe Commission, on or before aspecified comment date for theparticular application, either acompeting development application or anotice of intent to file such anapplication. Submission of a timelynotice of intent to file a developmentapplication allows an interested personto file the competing application nolater than 120 days after the specifiedcomment date for the particularapplication. A competing licenseapplication must conform with 18 CFR4.30(b)(1) and (9) and 4.36.

A9. Notice of intent—A notice ofintent must specify the exact name,business address, and telephone numberof the prospective applicant, and mustinclude an unequivocal statement ofintent to submit, if such an applicationmay be filed, either a preliminarypermit application or a developmentapplication (specify which type ofapplication). A notice of intent must beserved on the applicant(s) named in thispublic notice.

A10. Proposed Scope of Studies underPermit—A preliminary permit, if issued,does not authorize construction. Theterm of the proposed preliminary permitwill be 36 months. The work proposedunder the preliminary permit wouldinclude economic analysis, preparationof preliminary engineering plans, and astudy of environmental impacts. Basedon the results of these studies, theApplicant would decide whether toproceed with the preparation of adevelopment application to constructand operate the project.

B. Comments, Protests, or Motions toIntervene—Anyone may submitcomments, a protest, or a motion tointervene in accordance with therequirements of Rules of Practice andProcedure, 18 CFR 385.210, .211, .214.In determining the appropriate action totake, the Commission will consider allprotests or other comments filed, butonly those who file a motion tointervene in accordance with theCommission’s Rules may become aparty to the proceeding. Any comments,protests, or motions to intervene mustbe received on or before the specifiedcomment date for the particularapplication.

B1. Protests or Motions to Intervene—Anyone may submit a protest or amotion to intervene in accordance withthe requirements of Rules of Practiceand Procedure, 18 CFR 385.210,385.211, and 385.214. In determiningthe appropriate action to take, theCommission will consider all protestsfiled, but only those who file a motionto intervene in accordance with theCommission’s Rules may become aparty to the proceeding. Any protests ormotions to intervene must be receivedon or before the specified deadline datefor the particular application.

C. Filing and Service of ResponsiveDocuments—Any filings must bear inall capital letters the title‘‘COMMENTS’’, ‘‘NOTICE OF INTENTTO FILE COMPETING APPLICATION’’,‘‘COMPETING APPLICATION’’,‘‘PROTEST’’, ‘‘MOTION TOINTERVENE’’, as applicable, and theProject Number of the particularapplication to which the filing refers.Any of the above-named documents


must be filed by providing the originaland the number of copies provided bythe Commission’s regulations to: TheSecretary, Federal Energy RegulatoryCommission, 825 North Capitol Street,N.E., Washington, D.C. 20426. Anadditional copy must be sent toDirector, Division of Project Review,Federal Energy Regulatory Commission,Room 1027, at the above-mentionedaddress. A copy of any notice of intent,competing application or motion tointervene must also be served upon eachrepresentative of the Applicantspecified in the particular application.

C1. Filing and Service of ResponsiveDocuments—Any filings must bear inall capital letters the title‘‘COMMENTS’’,‘‘RECOMMENDATIONS FOR TERMSAND CONDITIONS’’, ‘‘PROTEST’’, or‘‘MOTION TO INTERVENE’’, asapplicable, and the Project Number ofthe particular application to which thefiling refers. Any of the above-nameddocuments must be filed by providingthe original and the number of copiesprovided by the Commission’sregulations to: The Secretary, FederalEnergy Regulatory Commission, 825North Capitol Street, N.E., Washington,D.C. 20426. A copy of any motion tointervene must also be served upon eachrepresentative of the Applicantspecified in the particular application.

D2. Agency Comments—Federal,state, and local agencies are invited tofile comments on the describedapplication. A copy of the applicationmay be obtained by agencies directlyfrom the Applicant. If an agency doesnot file comments within the timespecified for filing comments, it will bepresumed to have no comments. Onecopy of an agency’s must also be sent tothe Applicant’s representatives.

D4. Filing and Service of ResponsiveDocuments—The application is readyfor environmental analysis at this time,and the Commission is requestingcomments, reply comments,recommendations, terms andconditions, and prescriptions.

The Commission directs, pursuant tosection 4.34(b) of the regulations (seeOrder No. 533 issued May 8, 1991, 56FR 23108, May 20, 1991) that allcomments, recommendations, terms andconditions and prescriptions concerningthe application be filed with theCommission within 60 days from theissuance date of this notice (March 7,1995 for Project No. 11503–000). Allreply comments must be filed with theCommission within 105 days from thedate of this notice (April 21, 1995 forProject No. 11503–000).

Anyone may obtain an extension oftime for these deadlines from the

Commission only upon a showing ofgood cause or extraordinarycircumstances in accordance with 18CFR 385.2008.

All filings must (1) bear in all capitalletters the title ‘‘PROTEST’’, ‘‘MOTIONTO INTERVENE’’, ‘‘NOTICE OFINTENT TO FILE COMPETINGAPPLICATION,’’ ‘‘COMPETINGAPPLICATION,’’ ‘‘COMMENTS,’’‘‘REPLY COMMENTS,’’‘‘RECOMMENDATIONS,’’ ‘‘TERMSAND CONDITIONS,’’ or‘‘PRESCRIPTIONS;’’ (2) set forth in theheading the name of the applicant andthe project number of the application towhich the filing responds; (3) furnishthe name, address, and telephonenumber of the person protesting orintervening; and (4) otherwise complywith the requirements of 18 CFR385.2001 through 385.2005. Allcomments, recommendations, terms andconditions or prescriptions must setforth their evidentiary basis andotherwise comply with the requirementsof 18 CFR 4.34(b). Agencies may obtaincopies of the application directly fromthe applicant. Any of these documentsmust be filed by providing the originaland the number of copies required bythe Commission’s regulations to: TheSecretary, Federal Energy RegulatoryCommission, 825 North Capitol Street,N.E., Washington, D.C. 20426. Anadditional copy must be sent toDirector, Division of Project Review,Office of Hydropower Licensing,Federal Energy Regulatory Commission,Room 1027, at the above address. Acopy of any protest or motion tointervene must be served upon eachrepresentative of the applicant specifiedin the particular application. A copy ofall other filings in reference to thisapplication must be accompanied byproof of service on all persons listed inthe service list prepared by theCommission in this proceeding, inaccordance with 18 CFR 4.34(b) and385.2010.

D8. Filing and Service of ResponsiveDocuments—The application is notready for environmental analysis at thistime; therefore, the Commission is notnow requesting comments,recommendations, terms andconditions, or prescriptions.

When the application is ready forenvironmental analysis, theCommission will issue a public noticerequesting comments,recommendations, terms andconditions, or prescriptions.

All filings must (1) bear in all capitalletters the title ‘‘PROTEST’’ or‘‘MOTION TO INTERVENE,’’ ‘‘NOTICEOF INTENT TO FILE COMPETINGAPPLICATION,’’ or ‘‘COMPETING

APPLICATION;’’ (2) set forth in theheading the name of the applicant andthe project number of the application towhich the filing responds; (3) furnishthe name, address, and telephonenumber of the person protesting orintervening; and (4) otherwise complywith the requirements of 18 CFR385.2001 through 385.2005. Agenciesmay obtain copies of the applicationdirectly from the applicant. Any of thesedocuments must be filed by providingthe original and the number of copiesrequired by the Commission’sregulations to: The Secretary, FederalEnergy Regulatory Commission, 825North Capitol Street, N.E., Washington,D.C. 20426. An additional copy must besent to Director, Division of ProjectReview, Office of HydropowerLicensing, Federal Energy RegulatoryCommission, Room 1027, at the aboveaddress. A copy of any protest or motionto intervene must be served upon eachrepresentative of the applicant specifiedin the particular application.

E1. Filing and Service of ResponsiveDocuments—The application is notready for environmental analysis at thistime; therefore, the Commission is notnow requesting comments,recommendations, terms andconditions, or prescriptions.

When the application is ready forenvironmental analysis, theCommission will issue a public noticerequesting comments,recommendations, terms andconditions, or prescriptions.

All filings must (1) bear in all capitalletters the title ‘‘PROTEST’’ or‘‘MOTION TO INTERVENE;’’ (2) setforth in the heading the name of theapplicant and the project number of theapplication to which the filingresponds; (3) furnish the name, address,and telephone number of the personprotesting or intervening; and (4)otherwise comply with the requirementsof 18 CFR 385.2001 through 385.2005.Agencies may obtain copies of theapplication directly from the applicant.Any of these documents must be filedby providing the original and thenumber of copies required by theCommission’s regulations to: TheSecretary, Federal Energy RegulatoryCommission, 825 North Capitol Street,N.E., Washington, D.C. 20426. Anadditional copy must be sent toDirector, Division of Project Review,Office of Hydropower Licensing,Federal Energy Regulatory Commission,Room 1027, at the above address. Acopy of any protest or motion tointervene must be served upon eachrepresentative of the applicant specifiedin the particular application.


Dated: January 23, 1995.Lois D. Cashell,Secretary.[FR Doc. 95–2048 Filed 1–26–95; 8:45 am]BILLING CODE 6717–01–P

[Docket No. CP95–150–000, et al.]

Texas Eastern TransmissionCorporation, et al.; Natural GasCertificate Filings



1. Texas Eastern TransmissionCorporation

[Docket No. CP95–150–000]Take notice that on January 11, 1995,

Texas Eastern Transmission Corporation(Texas Eastern), 5400 Westheimer Court,P.O. Box 1642, Houston, Texas 77251–1642, filed in Docket No. CP95–150–000a request pursuant to § § 157.205 and157.211 of the Commission’sRegulations under the Natural Gas Act(18 CFR 157.205, 157.211) forauthorization to operate an existing tapas a bidirectional tap to enable TexasEastern to deliver gas to an independentproducer under Texas Eastern’s blanketcertificate issued in Docket No. CP82–535–000 pursuant to Section 7 of theNatural Gas Act, all as more fully setforth in the request that is on file withthe Commission and open to publicinspection.

Texas Eastern proposes to operate anexisting tap as a bidirectional tap toenable Texas Eastern to deliver gas toand receive gas from Zilkha EnergyCompany (Zilkha), an independentproducer in East Cameron Block 328Platform. It is stated that up to 3,000Dth/d would be received and/ordelivered through this tap. Zilkha willinstall 9,230 feet of 4-inch pipeline andrelated meters extending from EastCameron Block 328 to East CameronBlock 323.

It is also stated that the interruptibleservice for Zilkha would be under TexasEastern’s Rate Schedule IT–1. TexasEastern’s tariff does not prohibit theadditional volumes, according to TexasEastern. Also, there would be nodetriment to its other customers orimpact on its peak or annual deliveries.

Comment date: March 6, 1995, inaccordance with Standard Paragraph Gat the end of this notice.

2. Williams Natural Gas Company


Williams Natural Gas Company (WNG),P.O. Box 3288, Tulsa, Oklahoma 74101,

filed in Docket No. CP95–154–000 arequest pursuant to Sections 157.205,157.212 and 157.216 of theCommission’s Regulations under theNatural Gas Act (18 CFR 157.205,157.212 and 157.216) for authorizationto relocate the Kansas Gas & Electric(KG&E) Brock tap and to abandon byreclaim, sale and in place approximately2.7 miles of 8-inch lateral pipelinelocated in Bourbon County, Kansasunder WNG’s blanket certificate issuedin Docket No. CP82–479–000 pursuantto Section 7 of the Natural Gas Act, allas more fully set forth in the request thatis on file with the Commission and opento public inspection.

The tap’s relocation is prompted byhighway construction from the KansasDepartment of Transportation. WNGproposes to move the KG&E Brock tapfrom the Ft. Scott 8-inch pipeline to theexisting Ft. Scott 16-inch pipeline. Dueto the highway construction, WNG willabandon by reclaim approximately 550feet, abandon in place approximately2.6 miles, and sell to Kansas Power &Light/Kansas Gas & Electric (KPL/KGE)approximately 0.5 miles of the 8-inchpipeline. Customers will be affected byWNG’s abandonment of the 8-inchpipeline, but agreement has been met tocontinue their receiving service fromKG&E. The estimated construction costis $16,044; the reclaim cost is $5,969and the salvage value is $3,200. Thepipeline to be abandoned in place willbe purged with air and capped.


3. Washington Natural Gas Company


Washington Natural Gas Company(Washington Natural), 815 MercerStreet, Seattle, Washington 98111, filedin Docket No. CP95–156–000 for aBlanket Certificate of PublicConvenience and Necessity underSubpart F of the Commission’sRegulations for the Jackson PrairieStorage Project (Storage Project), all asmore fully set forth in the applicationwhich is on file with the Commissionand open to public inspection.

According to Washington Natural, theStorage Project, an aquifer-type naturalgas storage facility in Chehalis (LewisCounty) Washington, connects to themain pipeline facilities of NorthwestPipeline Corporation (Northwest), and isowned in equal undivided interests byWashington Natural, The WashingtonWater Power Company and Northwest.Washington Natural indicates that theoperations of the Storage Project will beconducted in accordance with an

executed agreement among the partiesand that the overall supervision of theproject will be under the direction of aManagement Committee.

Washington Natural states thatalthough it has applied for case specificcertificates in the past related tooperations at Storage Project, it wouldbe more cost effective and less timeconsuming if Storage Project werepermitted to utilize a blanket certificate.

Comment date: February 10, 1995, inaccordance with the first paragraph ofStandard Paragraph E at the end of thisnotice.

4. NorAm Gas Transmission Company

[Docket No. CP95–160–000]

Take notice that on January 17, 1995,NorAm Gas Transmission Company(NGT), 1600 Smith Street, Houston,Texas 77002, filed in Docket No. CP95–160–000 a request pursuant to§§ 157.205 and 157.216 of theCommission’s Regulations under theNatural Gas Act (18 CFR 157.205,157.216) for authorization to abandoncertain facilities in Oklahoma underNGT’s blanket certificate issued inDocket No. CP82–384–000, et al.,pursuant 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.

NGT proposes to abandon by transferand sale to Arkla a segment of NGT’sLine 634 in Pontotoc County, Oklahomaand to abandon in place one inactive 1-inch domestic tap on NGT’s Line 634–2 in Hughes County, Oklahoma. Thesegment of Line 634 consists of 2,520feet of 2-inch plastic pipe and threerural taps, two 1-inch and one 2-inchtaps serving only Arkla’s rural domesticand small commercial customers. NGTstates that no customers or service willbe abandoned as a result of the transfer.


5. Williston Basin Interstate PipelineCompany and K N Interstate GasTransmission Co.


Take notice that on January 18, 1995,Williston Basin Interstate PipelineCompany (Williston), 200 North ThirdStreet, Suite 300, Bismarck, NorthDakota 58501 and K N Interstate GasTransmission Co. (K N), 370 VanGordon Street, Lakewood, Colorado80228 filed a joint application pursuantto Section 7(b) of the Natural Gas Actand part 157 of the Commission’sRegulations requesting permission andapproval to abandon sales,


1 See, 58 FPC 1738 (1977).2 See, 30 FERC ¶ 61,143 (1985).3 See, 63 FERC ¶ 61,155 (1993).

transportation and exchange servicesrendered under Williston’s RateSchedule No. X–3, FERC Gas Tariff,Original Volume No. 1, and K N’s RateSchedule X–4, FERC Gas Tariff, SecondRevised Volume No. 2, effectiveDecember 1, 1994.1 The application ison file with the Commission and opento public inspection.

Williston and K N state that theypropose to abandon the above servicesauthorized in Docket Nos. CP75–154and CP75–57, respectively, to Montana-Dakota Utilities Co. (Williston’spredecessor) 2 and Kansas-Nebraska GasCompany, Inc. (K N’s predecessor).3Williston and K N state that pursuant toa June 30, 1994, Settlement Agreement,the parties agreed to terminate the gaspurchase obligation under RateSchedules X–3 and X–4 as of July 1,1994, provided, however, that thetransportation and exchange serviceunder Rate Schedule X–3 was tocontinue until December 1, 1994, whenthe agreement was terminated in itsentirety. Williston and K N state thatthey are the only parties to the gas sales,transportation and exchange services inthe referenced rate schedules.

Comment date: February 10, 1995, inaccordance with Standard Paragraph Fat the end of this notice.

Standard ParagraphsF. Any person desiring to be heard or

to make any protest with reference tosaid application should on or before thecomment date, file with the FederalEnergy Regulatory Commission,Washington, D.C. 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 the

Commission 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.

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 Section157.205 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 allowed 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 Section 7 ofthe Natural Gas Act.Lois D. Cashell,Secretary.[FR Doc. 95–2049 Filed 1–26–95; 8:45 am]BILLING CODE 6717–01–P

[Docket No. CP95–158–000, et al.]

Williams Natural Gas Company, et al.;Natural Gas Certificate Filings



1. Williams Natural Gas Company


Take notice that on January 17, 1995,Williams Natural Gas Company (WNG),Post Office Box 3288, Tulsa, Oklahoma74101, filed an application pursuant toSection 7(b) of the Natural Gas Act foran order permitting the abandonment bysale of WNG’s Humphrey’s gatheringsystem located in Hemphill County,Texas to GPM Gas Corporation (GPM),a local producer, all as more fully setforth in the application which is on filewith the Commission and open topublic inspection.

WNG states that it will conveyapproximately 15.1 miles of 4-inch, 6-inch, 8-inch, 12-inch and 16-inchgathering lines, associated meter runs,meters and a 660 horsepowercompressor station. WNG states thatthere are currently two gas purchasecontracts in the Humphrey’s field whichWNG has been unable to terminate.WNG asserts that there has been no gasflow on these contracts for some timeand the meters associated with bothcontracts have been blinded.Additionally, WNG claims that it hasmade numerous telephone calls as wellas written contact in its attempt tosecure abandonment authorization fromthe producers. WNG states that itbelieves that one of the producers isdelivering gas to another pipelinecompany and the other producer hasplugged and abandoned the well whichis connected to WNG’s gatheringsystem. Therefore, WNG asks that theCommission grant the abandonment ofthe gas purchase contracts and approvethe abandonment of the gatheringsystem.

WNG also states that GPM has agreedto continue to provide service to theonly right-of-way customer located inthe gathering system. Further, WNGstates that the service will be providedpursuant to the terms and conditions ofa right-of-way agreement between thecustomer and WNG. WNG requests thatthe Commission approve theabandonment by assignment of thisright-of-way customer.

WNG states that GPM purchases all ofthe wellhead volumes in theHumphrey’s gathering area, andtherefore does not believe that a Section4 filing is required to terminate thegathering service. Additionally, WNGdoes not believe that a default contractis needed since there are no othershippers involved.

WNG indicates that it will sell thefacilities to GPM for a base price of$412,000—twenty percent of thepurchase price, $82,400, is to be paidwithin seventy-two hours of executionof the Sales Agreement and the balanceof the purchase price, $329,600, is to bepaid at closing—plus an additionalamount equal to three percent perannum on the unpaid balance of thepurchase price, $329,600, as measuredfrom the effective date until the closingdate.


2. Pontchartrain Natural Gas System


Pontchartrain Natural Gas System


1 Pontchartrain asserts that it is a ‘‘Hinshaw’’natural gas pipeline company that operates whollywithin the State of Louisiana.

(Pontchartrain), 1600 Smith Street, Suite4775, Houston, Texas 77002, filed inDocket No. CP95–159–000 anapplication pursuant to Section 7(b) ofthe Natural Gas Act for permission andapproval to abandon an exchangeservice with ANR Pipeline Company(ANR), all as more fully set forth in theapplication which is on file with theCommission and open to publicinspection.

Pontchartrain1 states that it wasauthorized to exchange natural gas withANR by order issued May 3, 1968, inDocket No. CP68–203. Pontchartrainfurther states that the exchangeagreement provides for termination byeither party on six months writtennotice. Pontchartrain asserts that byletter dated September 23, 1993, ANRprovided written notice to Pontchartrainthat it would terminate the serviceeffective March 31, 1994. Pontchartrainfurther states that, beginning April 1,1994, the exchange service will besuperseded with a transportation servicepursuant to ANR’s Rate Schedule FTS–1. Pontchartrain does not propose toabandon any facilities.


3. Havre Pipeline Company, LLC


Havre Pipeline Company, LLC (Havre),410 17th Street, Suite 1400, Denver,Colorado 80802, filed a petitionpursuant to Section 1(b)of the NaturalGas Act (NGA), 15 U.S.C. § 717(b),Section 2(16) of the Natural Gas PolicyAct of 1978, 15 U.S.C. § 3301(16), andRule 207 of the Commission’s Rules ofPractice and Procedure (18 CFR385.207), for a declaratory orderexempting facilities to be purchasedfrom Northern Natural Gas Company(Northern) from Commission regulationunder the NGA, and for a determinationthat Havre will be an intrastate pipelinewithin the meaning of NGPA Section2(16), all as more fully set forth in theamendment which is on file with theCommission and open to publicinspection.

Specifically, Havre intends topurchase from Northern pipeline,compression, and appurtenant facilitieslocated in Blaine, Chouteau, and HillCounties, Montana. Havre states that asignificant amount of the facilities to beacquired are low-pressure, smalldiameter lines used to gather Montanagas production. In addition, Havre states

that the facilities to be acquired includethree compressor stations and largediameter, higher pressure pipelines,whose primary function is to transportMontana gas after it is gathered. Havrestates that it will be a gatherer andtransporter of natural gas, and willoperate the facilities to be acquired fromNorthern to serve intrastate shippers inMontana and those shippers that requestinterstate transportation servicespursuant to NGPA Section 311.

Comment date: February 13, 1995, inaccordance with the first paragraph ofStandard Paragraph F at the end of thisnotice.

4. National Fuel Gas SupplyCorporation


Take notice that on January 19, 1995,National Fuel Gas Supply Corporation(National), 10 Lafayette Square, Buffalo,New York 14203, filed in Docket No.CP95–163–000 a request pursuant to§§ 157.205 and 157.211 of theCommission’s Regulations under theNatural Gas Act (18 CFR 157.205,157.211) for authorization to constructand operate a sales tap to render serviceto a new residential customer ofNational Fuel Gas DistributionCorporation (Distribution) underNational’s blanket certificate issued inDocket No. CP83–4–000 pursuant toSection 7 of the Natural Gas Act, all asmore fully set forth in the request thatis on file with the Commission and opento public inspection.

National proposes to construct andoperate a new residential sales tap inJefferson County, Pennsylvania.National states that the total estimateddeliveries for the sales tap will be 150Mcf annually.

National estimates the cost ofconstructing the sales tap to be $1,500,which will be reimbursed byDistribution.


5. Equitrans, Inc.


Take notice that on January 19, 1995,Equitrans, Inc. (Equitrans), 3500 ParkLane, Pittsburgh, Pennsylvania 15275,filed in Docket No. CP95–164–000 arequest pursuant to §§ 157.205 and157.212 of the Commission’sRegulations under the Natural Gas Act(18 CFR 157.205, 157.212) forauthorization to construct a newdelivery point under Equitrans’s blanketcertificate issued in Docket No. CP83–508–000 pursuant to Section 7 of theNatural Gas Act, all as more fully set

forth in the request that is on file withthe Commission and open to publicinspection.

Equitrans proposes to construct andoperate a new delivery tap on Equitrans’line F–119 in the City of Waynesburg,Pennsylvania, to provide gastransportation service to Equitable GasCompany, a division of EquitableResources, Inc. (Equitable). Equitransstates that the tap would permitEquitable to provide retail gas service toJeffrey and Kimberly Tennant. Equitransprojects the quantity of gas to bedelivered through the delivery tapwould be approximately 1 Mcf on apeak day. Equitrans would transport thegas under its Rate Schedule FTS andcharge Equitable the applicable ratecontained in Equitrans’s tariff on filewith the Commission.


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, D.C. 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, further


1 18 CFR 385.2010 (1992).

notice 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.

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 allowed 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 Section 7 ofthe Natural Gas Act.Lois D. Cashell,Secretary.[FR Doc. 95–2050 Filed 1–26–95; 8:45 am]BILLING CODE 6717–01–P

[Project Nos. 2404 and 2419]

Thunder Bay Power Company;Proposed Restricted Service List for aProgrammatic Agreement forManaging Properties Included in orEligible for Inclusion in the NationalRegister of Historic Places

January 23, 1995.Rule 2010 of the Commission’s Rules

of Practice and Procedure provides that,to eliminate unnecessary expense orimprove administrative efficiency, theSecretary may establish a restrictedservice list for a particular phase orissue in a proceeding.1 The restrictedservice list should contain the names ofpersons on the service list who, in thejudgment of the decisional authorityestablishing the list, are activeparticipants with respect to the phase orissue in the proceeding for which thelist is established.

The Commission is consulting withthe Michigan State Historic PreservationOfficer (hereinafter, SHPO) and theAdvisory Council on HistoricPreservation (hereinafter, Council)pursuant to 36 CFR 800.13 of theCouncil’s regulations implementingSection 106 of the National HistoricPreservation Act, as amended, (16U.S.C. 470f), to prepare a programmaticagreement for managing propertiesincluded in, or eligible for inclusion in,

the National Register of Historic Placesat Project Nos. 2404 and 2419.

The programmatic agreement, uponapproval by the Commission, the SHPO,and the Council, would satisfy theCommission’s Section 106responsibilities for all individualundertakings carried out in accordancewith the agreement until the agreementexpires or is terminated (36 CFR800.13[e]). The Commission’s Section106 requirements for the above projectwould be fulfilled through oneprogrammatic agreement for commentsunder Section 106.

Thunder Bay Power Company, as aprospective licensee for the projects, isbeing asked to participate in theconsultation and is being invited to signas a concurring party to theprogrammatic agreement.

For purposes of commenting on theprogrammatic agreement we propose torestrict the service list of Project Nos.2404 and 2419 as follows:

Mr. Roger Steed, President, ThunderBay Power Company, 10850, TraverseHighway, #1101, Traverse City, MI49684.

Ms. Kathryn B. Eckert, Michigan StateHistoric Preservation Officer,Michigan Bureau of History,Department of the State, 208 NorthCapitol Avenue, Lansing, MI 48918.

Advisory Council on HistoricPreservation, Eastern Office of ProjectReview, The Old Pose OfficeBuilding, Suite 809, 1100Pennsylvania Avenue, NW.,Washington, DC 20004.

Any person on the official service listfor the above-captioned proceedingsmay request inclusion on the restrictedservice list, or may request that arestricted service list not be established,by filing a motion to that effect within15 days of this notice date. An originaland 8 copies of any such motion mustbe field with the Secretary ofCommission (825 N. Capitol St., NE,Washington, D.C. 20426) and must beserved on each person whose nameappears on the official service list. If nosuch motions are filed, the restrictedservice list will be effective at the endof the 15 day period. Otherwise, afurther notice will be issued ruling onthe motion.Lois D. Cashell,Secretary.[FR Doc. 95–2020 Filed 1–26–95; 8:45 am]



East Tennessee Natural Gas Company;Technical Conference

January 23, 1995.A technical conference will be held to

discuss issues raised in the above-captioned proceeding on Wednesday,February 22, 1995, at 9:30 a.m., in Room2402–A at the offices of the FederalEnergy Regulatory Commission, 825 N.Capitol Street, N.E., Washington, D.C.20426.

All interested persons and Staff arepermitted to attend. However,attendance does not confer party status.

For additional information, contactTimothy W. Gordon at (202) 208–2265.Lois D. Cashell,Secretary.[FR Doc. 95–2019 Filed 1–26–95; 8:45 am]BILLING CODE 6717–01–M


[ER–FRL–4719–7]

Environmental Impact Statements andRegulations; Availability of EPAComments

Availability of EPA commentsprepared December 26, 1994 ThroughDecember 30, 1994 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 FederalActivities at (202) 260–5076.

An explanation of the ratings assignedto draft environmental impactstatements (EISs) was published in FRdated April 10, 1994 (59 FR 16807).

Draft EISs

ERP No. D–AFS–G65060–TX RatingLO, Texas National Forests andGrasslands Revised Land and ResourceManagement Plan, Implementation,several counties, TX.

Summary: EPA expressed lack ofobjections with the preferred alternativein the draft EIS.

ERP No. D–COE–K35036–CA RatingEC2, Montezuma Wetlands Project, Useof Cover and Non-cover DredgedMaterials to restore Wetland,Implementation, Conditional-Use-Permit, NPDES and COE Section 10 and404 Permit, Suisum Marsh inCollinsville, Solano County, CA.

Summary: EPA supported theproposed project, but expressedenvironmental concern over the lack ofinformation regarding the practicability


(including availability) of the off-sitealternatives; the lack of a Clean WaterAct Section 404 (b) (1) evaluation; andthe inadequacy of the discussionregarding proposed monitoring andmitigation measures.

ERP No. DS–GSA–L81009–WA RatingLO, Seattle Federal Courthouse Building(Project #ZWA 81061), Implementation,Site Selection, Construction andOperation, Additional Information, KingCounty, WA.

Summary: EPA had no objection withthe proposed action as this documenteffectively addressed EPA’s previousconcerns.

Final EISs

ERP No. F–BLM–L65175–OR, CoosBay District Resource Management Plan,Implementation, Coos Bay District,Coos, Curry and Douglas Counties, OR.

Summary: EPA had no objection tothe action as proposed. The final EISadequately addressed previousenvironmental concerns raised by EPA.

ERP No. F–BLM–L65177–OR,Medford District Resource ManagementPlan, Implementation, Medford District,Douglas, Jackson, Coos and Curry, OR.

Summary: EPA had no objection tothe action as proposed. The final EISadequately addressed previousenvironmental concerns raised by EPA.

ERP No. F–COE–C36070–PR, RioGuanajibo River Basin Flood ProtectionProject, Implementation and NPDESPermit, Mayaguez and San German, PR.

Summary: EPA does not object toimplementation of the preferredalternative for this project. However,EPA requested that additional wetlandsminimization efforts be addressed priorto the issuance of the Record ofDecision.

ERP No. F–FHW–C40131–NY, LongIsland Expressway (I–495)/Seaford—Oyster Bay Expressway (NY–135)Interchange Project, Improvementsbetween Exit 43 South Oyster Bay Roadto Exit 46 Sunnyside Boulevard,Funding and NPDES Permit, Town ofOyster Bay, Nassau County, NY.

Summary: EPA does not anticipatethat the proposed project will result insignificant adverse environmentalimpacts. Accordingly, EPA had noobjections to the implementation of theproposed project. The final EIS for theLIE/SOBE project addressed theconcerns EPA identified in its review ofthe draft EIS.

ERP No. F–NPS–L70012–ID, City ofRocks National Reserve, ComprehensiveManagement Plan and DevelopmentConcept Plan, Implementation, CassiaCounty, ID.

Summary: EPA had no objection tothe preferred alternative as described inthe EIS.

ERP No. F–SCS–D36112–WV, NorthFork Hughes River Watershed Plan,Installation of a Multi-purpose RollerCompacted Concrete Dam,Implementation and Funding, FloodProtection and COE Section 404Permits, Ritchie County, WV.

Summary: EPA continued to haveenvironmental objections with thepermanent inundation of 8.1 miles ofhigh quality aquatic habitat and 305acres of terrestrial habitat. Because theEIS remains inadequate, EPArecommended that a Revised Draft orSupplemental Draft EIS be prepared.

ERP No. F–USN–K11055–CA,Lemoore Naval Air Station Realignment,Relocation of 98 Military ConstructionProjects from Miramar Naval AirStation, Implementation, LemooreCounty, CA.

Summary: EPA expressedenvironmental concerns andrecommended that the Navy amend thecumulative impact section and presentthe expanded analysis in the Record ofDecision.

ERP No. FS–SFW–A64056–00,Programmatic EIS, Federal Aid in SportsFish and Wildlife Restoration ProgramsOperation and Management, UpdatedInformation, Implementation andFunding.

Summary: EPA had no objections tothe program.

Dated: January 24, 1995.William D. Dickerson,Director, Federal Agency Liaison Division,Office of Federal Activities.[FR Doc. 95–2086 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–U

[ER–FRL–4719–6]

Environmental Impact Statements;Notice of Availability

Responsible Agency: Office of FederalActivities, General Information (202)260–5076 OR (202) 260–5075.

Weekly receipt of EnvironmentalImpact Statements Filed January 16,1995 Through January 20, 1995Pursuant to 40 CFR 1506.9.EIS No. 950016, DRAFT EIS, AFS, UT,

Blanchett Park Dam and IrrigationReservoir, Construction andOperation, Uintah Water ConservancyDistrict (UWCD), Special-Use-Permitand COE Section 404 Permit, AshleyNational Forest, Vernal RangerDistrict, Uintah County, UT, Due:March 13, 1995, Contact: RolandLeiby (801) 781–5140.

EIS No. 950017, DRAFT EIS, NPS, TN,Foothills Parkway Section 8D,Construction, between Wear ValleyRoad (US 321) and Gatlinburg PigeonForge Spur (US 441/321), Right-of-Way and COE Section 404 Permits,Great Smoky Mountain National Park,Blount, Sevier and Cocke Counties,TN, Due: March 17, 1995, Contact:Tom Brown (404) 331–2608.

EIS No. 950018, DRAFT EIS, BLM, WY,Kenetech/PacifiCorp WindpowerDevelopment Project, Construction of500–MW Windplant and 230-kVTransmission Line between Arlingtonand Hanna Right-Use-Way Grant, COESection 404 Permit and Special-Use-Permit, Carbon County, WY, Due:March 27, 1995, Contact: Walter E.George (307) 324–7171.

EIS No. 950019, FINAL EIS, FHW, NC,US 421 Transportation Improvementjust west of the South Fork New Riverto NC–1361 east of the Town of DeepGap, Funding, Land Transfer and COESection 404 Permit(s), WataugaCounty, NC, Due: February 27, 1995,Contact: Nicholas L. Graf (919) 856–4346.

EIS No. 950020, DRAFT SUPPLEMENT,FHW, WV, OH, Appalachian CorridorD Construction, Ohio River to I–77,Updated Information concerning thecompletion of Corridor D ‘‘MissingLink’’, from US 50 in Belpre, OH tothe Interchange east of Parkersburg,WV, US Coast Guard Bridge, COESection 404 and NPDES Permits, WVand OH, Due: March 31, 1995,Contact: Bobby Blackmon (304) 558–3093.

EIS No. 950021, DRAFT EIS, FHW, CA,Alameda Railroad CorridorConsolidated Project, Constructionfrom Downtown Los Angeles to theBadger Avenue Bridge/CA–91,Funding, COE Section 404 Permit andICC Approval, Los Angeles County,CA, Due: March 13, 1995, Contact:William Gelston (202) 366–0354.

EIS No. 950022, DRAFT EIS, FRC, VA,Gaston and Roanoke Rapids Project(FERC-No. 2009–003), Nonpoint Useof Project Lands and Water for theCity of Virginia Beach Water SupplyProject, License Issuance, BrunswickCounty, VA, Due: March 13, 1995,Contact: Steve Edmondson (202) 219–2653.

EIS No. 950023, DRAFT EIS, BLM, WY,Greater Wamsutter Area II Natural GasDevelopment Project, Approvals andPermits Issuance, Carbon andSweetwater Counties, WY, Due:March 27, 1995, Contact: John Spehar(307) 324–7171.

EIS No. 950024, DRAFT EIS, DOE, SC,Savannah River Site WasteManagement Facilities,


Implementation, Aiken, Allendaleand Barnwell Counties, SC, Due:March 13, 1995, Contact: YardenaMansoor (202) 586–9326.

Amended Notices

EIS No. 950013, FINAL EIS, DOE, CA,Adoption Southeast RegionalWastewater Treatment Plant andGeysers Effluent Pipeline InjectionProject, Improvements Funding, COESection 404 Permit and NPDESPermit, City of Clearlake, LakeCounty, CA, Contact: Teresa Perkins(208) 526–1483.Published FR 01–20–95 Correction of the

Agency Contact Person Name and TelephoneNumber.

Dated: January 24, 1995.William D. Dickerson,Director, Federal Agency Liaison DivisionOffice of Federal Activities.[FR Doc. 95–2087 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–U

[ER–FRL–4719–5]

Joint Water Pollution Control Plant,Upgrade to Full Secondary Treatment;Intent To Prepare a DraftEnvironmental Impact Statement

AGENCY: U.S. Environmental ProtectionAgency (EPA).ACTION: Notice of intent to prepare adraft environmental impact statement(DEIS) for the upgrade to full secondarytreatment for the Joint Water PollutionControl Plant located in Carson,California.

PURPOSE: To fulfill the requirements ofSection 102(2)(c) of the NationalEnvironmental Policy Act, EPA hasidentified the need to prepare a DEISand therefore issues this Notice of Intentpursuant to 40 CFR 1501.7.FOR FURTHER INFORMATION AND TO BEPLACED ON THE PROJECT MAILING LISTCONTACT: Ms. Elizabeth Borowiec, WaterManagement Division, U.S.Environmental Protection Agency,Region IX, 75 Hawthorne Street, SanFrancisco, CA, 94105, Telephone: (415)744–1948

Summary: Description of proposedaction.

Need for Action

In January, 1992, EPA and CaliforniaRegional Water Quality Control Boardfiled suit against the Districts underSection 309 of the Clean Water Act tocomply with full secondary treatment atthe JWPCP. A Consent Decree wasnegotiated between the Districts, theUnited States, the Natural ResourcesDefence Council, and Heal the Bay to

meet this requirement by December 31,2002. The Districts have prepared theJoint Outfall System 2010 MasterFacilities Plan which addresses the needto provide full secondary treatment, aswell as the long-term need forwastewater treatment, reuse, anddisposal through the year 2010. Inaddition, the Districts have completed adraft program environmental impactreport (EIR) that analyzes the impacts ofthe 2010 Plan as required by theCalifornia Environmental Quality Act(CEQA). The draft EIR was circulated forpublic review on November 14, 1994.The comment period for the draft EIRconcluded on January 17, 1995. Finally,unlike most EIRs, the Districts haveinitiated a consultation and reviewprocess with federal agencies on thisdraft EIR, which is similar to the processrequired under the NationalEnvironmental Policy Act (NEPA). Thisprocess was launched pursuant torequirements of the State WaterResources Control Board’s StateRevolving Fund (SRF) loan program.

EPA intends to award direct grantfunds to the County Sanitation Districtsof Los Angeles County (Districts)provided under the 1995Appropriations Act (Public Law 103–327). The purpose of the grant is for theplanning, design, and construction ofwastewater treatment facilities toupgrade the Joint Water PollutionControl Plant (JWPCP) in the City ofCarson, California to 400 million gallonsper day (mgd) of secondary treatmentcapacity.

AlternativesAlternatives to the proposed action

anticipated to be analyzed in the DEISconsist of:

• those alternatives analyzed in thedraft program EIR, which includeupgrading the JWPCP to either 400 mgdor 350 mgd of secondary treatmentcapacity; and

• the No-Action Alternative, whereno new facilities would be funded byEPA to upgrade the level of treatment atthe JWPCP.

ScopingThe focus of the DEIS will be on the

construction and operation of thesecondary treatment and related solidsprocessing facilities at the JWPCP. EPARegion IX invites comments on theproposed action and alternatives to theproposed action. A separate EIS scopingmeeting is not planned at this timebecause of the extensive scoping processalready undertaken by the Districtsduring preparation of the draft EIR.However, public comments will beaccepted after the release of the DEIS.

For additional information, contact theperson indicated above.

Estimated Date of DEIS ReleaseSpring of 1995.Responsible Official: John Wise,

Deputy Regional Administrator.Dated: January 24, 1995.

Richard E. Sanderson,Director, Office of Federal Activites.[FR Doc. 95–2113 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–P

[ER–FRL–4719–4]

Designation of Ocean Dredged MaterialDisposal Site (ODMDS) Offshore PortEverglades, FL; Intent To Prepare anEnvironmental Impact Statement

AGENCY: U.S. Environmental ProtectionAgency (EPA) Region IV.ACTION: Notice of intent to prepare anEnvironmental Impact Statement (EIS)on the final designation of an ODMDSoffshore Port Everglades, Florida.

PURPOSE: The U.S. EPA, Region IV, inaccordance with Section 102(2)(c) of theNational Environmental Policy Act(NEPA) and in cooperation with theU.S. Army Corps of Engineers,Jacksonville District, will prepare aDraft EIS on the designation of anODMDS offshore Port Everglades,Florida. An EIS is needed to provide theinformation necessary to designate anODMDS. This Notice of Intent is issuedPursuant to Section 102 of the MarineProtection, Research and SanctuariesAct of 1972, and 40 CFR Part 228(Criteria for the Management of DisposalSites for Ocean Dumping).FOR FURTHER INFORMATION AND TO BEPLACED ON THE PROJECT MAILING LISTCONTACT: Mr. Christopher McArthur,U.S. Environmental Protection Agency,Region IV, 345 Courtland St. NE,Atlanta, Georgia 30365, phone 404–347–1740 ext. 4289 or Mr. Rea Boothby, U.S.Army Corps of Engineers, JacksonvilleDistrict, Planning Division, P.O. Box4970, Jacksonville, Florida 32232–0019,phone 904–232–3453.SUMMARY: The entrance channel andturning basin of Port Everglades mustreceive periodic maintenance dredgingto ensure safe navigation. The dredgedmaterial has been disposed of at theexisting interim ODMDS for PortEverglades in the past. Designation of aPort Everglades ODMDS is beingevaluated to determine the most feasibleand environmentally acceptable oceandisposal site for anticipated futuredredging.NEED FOR ACTION: The Corps ofEngineers, Jacksonville District, has


requested that EPA designate anODMDS offshore Port Everglades,Florida for the disposal of dredgedmaterial from the Port Everglades areawhen ocean disposal is the preferreddisposal alternative. An EIS is requiredto provide the necessary information toevaluate alternatives and designate thepreferred ODMDS.

Alternatives1. No action. The no action alternative

is defined as not designating an oceandisposal site.

2. Alternative disposal sites in thenearshore, and shelf break regions.

ScopingA scoping meeting is not

contemplated. Scoping will beaccomplished through contact withaffected Federal, State and localagencies, and with anticipatedinterested parties.

Estimated Date of ReleaseThe Draft EIS will be made available

in January 1997.

Responsible OfficialJohn H. Hankinson, Jr., Regional

Administer, Region IV.Richard E. Sanderson,Director, Office of Federal Activities.[FR Doc. 95–2088 Filed 1–26–95; 8:45 am]BILLING CODE 6560–50–P

[FRL–5144–5]

State Program Requirements;Application to Administer the NationalPollutant Discharge EliminationSystem (NPDES) Program; Florida

AGENCY: Environmental ProtectionAgency.ACTION: Public notice of application forNPDES program approval.

SUMMARY: The State of Florida hassubmitted a request to theEnvironmental Protection Agency (EPA)for approval to administer the NationalPollutant Discharge Elimination System(NPDES) program for regulatingdischarges of pollutants into waters ofthe State of Florida. The NPDESprogram would be administered by theFlorida Department of EnvironmentalProtection (FDEP). FDEP has requesteda phased NPDES program encompassingpermitting for: (1) Domestic discharges;(2) industrial discharges, includingthose which also have storm waterdischarges; and (3) pretreatment. Stormwater discharges from municipalseparate storm sewer systems (MS4’s),individual storm water-only discharges,storm water general permits, and federal

facility dischargers are to be phased inby the year 2000 for administration bythe State. This notice provides forpublic hearing and a comment periodon Florida’s request. Under EPAregulations, Regional Administratorswill approve or disapprove this requestafter taking into consideration allcomments received.DATES: Comments must be received onor before March 13, 1995. Publichearings have been scheduled for:March 7, 1995, 10 a.m.–1 p.m. and 7

p.m.–10 p.m., Civic ConventionCenter, 9800 International Drive,Orlando, Florida 32819, OrangeCounty

March 9, 1995, 10 a.m.–1 p.m. and 7p.m.–10 p.m., Leon County CivicCenter, 505 W. Pensacola Street,Tallahassee, Florida 32301, LeonCountyPart or all of the submittal (which

comprises approximately 1500 pages)may be copied at any FDEP office, orEPA office in Atlanta, at a minimal costper page. A copy of the entire submittalmay be obtained from the FDEP officein Tallahassee for a fee.FOR FURTHER INFORMATION CONTACT: Ms.Dee Stewart, Environmental Engineer,Permits Section, U.S. EPA Region IV,345 Courtland Street, NE., Atlanta,Georgia, 30365, 404/347–3012, ext.2928, or Mr. Daryll Joyner, FDEP, Suite202, Twin Towers Office Building, 2600Blair Stone Road, Tallahassee, Florida,32301, 904/488–4520.SUPPLEMENTARY INFORMATION: Section402 of the Federal Clean Water Act (Act)created the NPDES program underwhich the Administrator of the UnitedStates Environmental Protection Agency(EPA) may issue permits for thedischarge of pollutants into waters ofthe United States under conditionsrequired by the Act. The Act alsoprovides that a State may be authorizedto administer the NPDES program uponrequest and showing that the State hasauthority and a program sufficient tomeet requirements of the Act. TheGovernor of Florida has requestedNPDES program approval and onNovember 21, 1994, submitted acomplete program description(including funding, personnelrequirements and organization, andenforcement procedures), anIndependent Counsel’s statement,copies of applicable State statutes andregulations, and a Memorandum ofAgreement (MOA) to be executed by theEPA, Region IV, Regional Administrator,and the Secretary, FDEP. The EPARegional Administrator is required toapprove the submitted program within90 days of submittal unless it does not

meet the requirements of section 402(b)of the Act and EPA regulations, whichinclude, among other things, authorityto issue permits which comply with theAct, authority to impose civil andcriminal penalties for permit violations,and authority to ensure that the publicis given notice and opportunity for ahearing on each proposed NPDESpermit issuance. At the close of thecomment period (including the publichearing), the EPA RegionalAdministrator will decide to approve ordisapprove Florida’s NPDES program. Inaccordance with EPA regulations, EPAand FDEP have agreed to extend thereview period beyond the ninety (90)day statutory period until April 30,1995.

The decision to approve ordisapprove Florida’s NPDES programwill be based on the requirements ofsection 402 of the CWA and 40 CFR Part123. If the Florida NPDES program isapproved, the EPA RegionalAdministrator will so notify the State.Notice will be published in the FederalRegister and, as of the date of programapproval, EPA will suspend issuance ofNPDES permits in Florida, except for:federal facilities, municipal separatestorm sewer systems, storm watergeneral permits, and individual stormwater permits, until FDEP assumespermitting and enforcement authoritiesfor these categories in the year 2000.The State’s program will implementfederal law and operate in lieu of theEPA administered program. However,EPA will retain the right to object toNPDES permits proposed to be issuedby the FDEP. If the EPA RegionalAdministrator disapproves Florida’sNPDES program, the RegionalAdministrator will notify the FDEP ofthe reasons for disapproval and of anyrevisions or modification to the programwhich are necessary to obtain approval.

The Florida submittal may bereviewed during normal business hours,Monday through Friday, excludingholidays, by the public at the FloridaFDEP and EPA offices at the addressappearing earlier in this Notice and atthe following FDEP District offices:Northwest District Office, 160Governmental Center, Pensacola,Florida, 32501–5794; SouthwestDistrict, 3804 Coconut Palm Drive,Tampa, Florida, 33619–8218; NortheastDistrict, 7825 Baymeadows Way, Suite200B, Jacksonville, Florida, 32256–7577; Central District, 3319 MaguireBlvd., Suite 232, Orlando, Florida,32803–3767; South District, 2295Victoria Ave., Suite 364, Fort Myers,Florida, 33901, and the SoutheastDistrict, 1900 S. Congress Ave., Suite A,West Palm Beach, Florida, 33406.


Public hearings to consider Florida’srequest to administer the NPDES permitprogram have been scheduled as shownat the beginning of this Notice. TheHearing Panel will includerepresentatives of EPA Region IV andthe Florida FDEP.

The following are policies andprocedures which shall be observed atthe public hearings:

1. The Presiding Officer shall conductthe hearing in a manner which willallow all interested persons wishing tomake oral statements an opportunity todo so; however, the Presiding Officermay inform attendees of any time limitsduring the opening statement of thehearings.

2. Any person may submit writtenstatements or documents for the record.

3. The Presiding Officer may, in hisdiscretion, exclude oral testimony ifsuch testimony is overly repetitious ofprevious testimony or is not relevant tothe decision to approve or requirerevision of the submitted State program.

4. The transcript taken at the hearing,together with copies of all submittedstatements and documents, shallbecome a part of the record submittedto the Regional Administrator.

5. The hearing record shall be leftopen until the deadline for receipt ofcomments specified at the beginning ofthis Notice to allow any person time tosubmit additional written statement orto present views or evidence tending torebut testimony presented at the publichearing.

Hearing statements may be oral orwritten. Written copies of oralstatements are urged for accuracy of therecord and for use of the Hearing Paneland other interested persons. Statementsshould summarize any extensive writtenmaterials. All comments received byEPA Region IV by the deadline forreceipt of comments, or presented at thepublic hearing, will be considered byEPA before taking final action on theFlorida request for NPDES programapproval.

Regulatory Flexibility Act

After review of the facts presented inthis document, I hereby certify,pursuant to the provisions of 5 U.S.C.605(b), that this notice of Florida’sapplication to administer the NPDESprogram will not have a significantimpact on a substantial number of smallentities. The approval of the FloridaNPDES permit program would merelytransfer responsibilities foradministration of the NPDES permit

program from Federal to Stategovernment.Patrick M. Tobin,Acting Regional Administrator.[FR Doc. 95–1862 Filed 1–26–95; 8:45 am]BILLING CODE 6560–5O–P

FEDERAL MARITIME COMMISSION

Agreement(s) Filed

The Federal Maritime Commissionhereby gives notice of the filing of thefollowing agreement(s) pursuant tosection 5 of the Shipping Act of 1984.

Interested parties may inspect andobtain a copy of each agreement at theWashington, D.C. Office of the FederalMaritime Commission, 800 NorthCapitol Street, N.W., 9th Floor.Interested parties may submit commentson each agreement to the Secretary,Federal Maritime Commission,Washington, D.C. 20573, within 10 daysafter the date of the Federal Register inwhich this notice appears. Therequirements for comments are found in§ 572.603 of Title 46 of the Code ofFederal Regulations. Interested personsshould consult this section beforecommunicating with the Commissionregarding a pending agreement.

Agreement No.: 232–011321–003.Title: Maersk/Sea-Land Pacific

Agreement.Parties:A.P. Moller-Maersk LineSea-Land Service, Inc.Synopsis: The proposed amendment

revises Article 9.3—Duration andTermination by reducing the noticeperiod required for withdrawal from theAgreement.

Agreement No.: 203–011487.Title: The ‘‘8900’’ Lines/APL

Discussion Agreement.Parties:‘‘8900’’ Lines AgreementAmerican President Lines, Ltd.Synopsis: The proposed Agreement

permits the parties to meet, discuss theirseparate tariffs, rates, service items,rules and service contracts in the tradefrom all United States ports and pointsto all ports and points in Bahrain, Iran,Iraq, Kuwait, Oman, Qatar, SaudiArabia, the United Arab Emirates,Jordan and Yemen. Adherence to anysuch agreement reached is voluntary.

Agreement No.: 224–200555–003.Title: Jacksonville Port Authority/

Allen Freight Trailer Bridge, Inc.Terminal Agreement.

Parties:Jacksonville Port AuthorityAllen Freight Trailer Bridge, Inc.

Synopsis: The proposed amendmentprovides for the annual rate increase tothe Agreement.

By Order of the Federal MaritimeCommission.

Dated: January 24, 1995.Joseph C. Polking,Secretary.[FR Doc. 95–2043 Filed 1–26–95; 8:45 am]BILLING CODE 6730–01–M

FEDERAL MEDIATION ANDCONCILIATION SERVICE

Labor-Management CooperationProgram; Application Solicitation

AGENCY: Federal Mediation andConciliation Service.ACTION: Publication of final Fiscal Year1995 Program Guidelines/ApplicationSolicitation for Labor-ManagementCommittees.

SUMMARY: The Federal Mediation andConciliation Service (FMCS) ispublishing the final Fiscal Year 1995Program Guidelines/ApplicationSolicitation for the Labor-ManagementCooperation program to inform thepublic. The program is supported byFederal funds authorized by the Labor-Management Cooperation Act of 1978,subject to annual appropriations. Nocomments were received from thepublic.FOR FURTHER INFORMATION CONTACT:Peter L. Regner, 202–606–8181.

Labor-Management CooperationProgram Application Solicitation forLabor-Management Committees FY1995

A. Introduction

The following is the final solicitationfor the Fiscal Year (FY) 1995 cycle ofthe Labor-Management CooperationProgram as it pertains to the support oflabor-management committees. Theseguidelines represent the continuingefforts of the Federal Mediation andConciliation Service to implement theprovisions of the Labor-ManagementCooperation Act of 1978 which wasinitially implemented in FY81. The Actgenerally authorizes FMCS to provideassistance in the establishment andoperation of plant, area, public sector,and industry-wide labor-managementcommittees which:

(A) have been organized jointly byemployers and labor organizationsrepresenting employees in that plant,area, government agency, or industry;and

(B) are established for the purpose ofimproving labor-management


relationships, job security, andorganizational effectiveness; enhancingeconomic development; or involvingworkers in decisions affecting their jobs,including improving communicationwith respect to subjects of mutualinterest and concern.

The Program Description and othersections that follow, as well as aseparately published FMCS Financialand Administrative Grants Manual,make up the basic guidelines, criteria,and program elements a potentialapplicant for assistance under thisprogram must know in order to developan application for funding considerationfor either a plant, area-wide, industry, orpublic sector labor-managementcommittee. Directions for obtaining anapplication kit may be found in SectionH. A copy of the Labor-ManagementCooperation Act of 1978, included inthe application kit, should be reviewedin conjunction with this solicitation.

B. Program Description

Objectives

The Labor-Management CooperationAct of 1978 identifies the followingseven general areas for which financialassistance would be appropriate:

(1) to improve communicationbetween representatives of labor andmanagement;

(2) to provide workers and employerswith opportunities to study and explorenew and innovative joint approaches toachieving organizational effectiveness;

(3) to assist workers and employers insolving problems of mutual concern notsusceptible to resolution within thecollective bargaining process;

(4) to study and explore ways ofeliminating potential problems whichreduce the competitiveness and inhibitthe economic development of the plant,area, or industry;

(5) to enhance the involvement ofworkers in making decisions that affecttheir working lives;

(6) to expand and improve workingrelationships between workers andmanagers; and

(7) to encourage free collectivebargaining by establishing continuingmechanisms for communicationbetween employers and their employeesthrough Federal assistance in theformation and operation of labormanagement committees.

The primary objective of this programis to encourage and support theestablishment and operation of jointlabor-management committees to carryout specific objectives that meet theforementioned general criteria. The term‘‘labor’’ refers to employees representedby a labor organization and covered by

a formal collective bargainingagreement. These committees may befound at either the plant (worksite),area, industry, or public sector levels. Aplant or worksite committee is generallycharacterized as restricted to one ormore organizational or productive unitsoperated by a single employer. An areacommittee is generally composed ofmultiple employers of diverse industriesas well as multiple labor unionsoperating within and focusing uponcity, county, contiguous multicounty, orstatewide jurisdictions. An industrycommittee generally consists of acollection of agencies or enterprises andrelated labor unions producing acommon product or service in theprivate sector on a local, state, regional,or nationwide level. A public sectorcommittee consists either of governmentemployees and managers in one or moreunits of a local or state government,managers and employees of publicinstitutions of higher education, or ofemployees and managers of publicinstitutions of higher education, or ofemployees and managers of publicelementary and secondary schools.Those employees must be covered by aformal collective bargaining agreementor other enforceable labor-managementagreement. In deciding whether anapplication is for an area or industrycommittee, consideration should begiven to the above definitions as well asto the focus of the committee.

In FY 1995, competition will be opento plant, area, private industry, andpublic sector committees. Public Sectorcommittees will be divided into twosub-categories for scoring purposes. Onesub-category will consist of committeesrepresenting state/local units ofgovernment and public institutions ofhigher education. The second sub-category will consist of publicelementary and secondary schools.

Special consideration will be given tocommittee applications involvinginnovative or unique efforts. Allapplication budget requests shouldfocus directly on supporting thecommittee. Applicants should avoidseeking funds for activities that areclearly available under other Federalprograms (e.g., job training, mediation ofcontract disputes, etc.).

Required Program Elements1. Problem Statement—The

application, which should havenumbered pages, must discuss in detailwhat specific problem(s) face the plant,area, government, or industry, and itsworkforce that will be addressed by thecommittee. Applicants must documentthe problem(s) using as much relevantdata as possible and discuss the full

range of impacts these problem(s) couldhave or are having on the plant,government, area, or industry. Anindustrial or economic profile of thearea and workforce might prove usefulin explaining the problem(s). Thissection basically discusses WHY theeffort is needed.

2. Results or Benefits Expected—Byusing specific goals and objectives, theapplication must discuss in detailWHAT the labor-managementcommittee as a demonstration effort willaccomplish during the life of the grant.While a goal of ‘‘improvingcommunication between employers andemployees’’ may suffice as one over-allgoal of a project, the objectives must,whenever possible, be expressed inspecific and measurable terms.Applicants should focus on the impactsor changes that the committee’s effortswill have. Existing committees shouldfocus on expansion efforts/resultsexpected from FMCS funding. Thegoals, objectives, and projected impactswill become the foundation for futuremonitoring and evaluation efforts.

3. Approach—This section of theapplication specifies HOW the goals andobjectives will be accomplished. At aminimum, the following elements mustbe included in all grant applications:

(a) a discussion of the strategy thecommittee will employ to accomplishits goals and objectives;

(b) a listing, by name and title, of allexisting or proposed members of thelabor-management committee. Theapplication should also offer a rationalefor the selection of the committeemembers (e.g., members represent 70%of the area of plant workforce).

(c) a discussion of the number, type,and role of all committee staff persons.Include proposed position descriptionsfor all staff that will have to be hired aswell as resumes for staff already onboard;

(d) in addressing the proposedapproach, applicants must also presenttheir justification as to why Federalfunds are needed to implement theproposed approach;

(e) a statement of how often thecommittee will meet as well as anyplans to form subordinate committeesfor particular purposes; and

(f) for applications from existingcommittees (i.e., in existence at least 12months prior to the submissiondeadline), a discussion of past effortsand accomplishments and how theywould integrate with the proposedexpanded effort.

4. Major Milestones—This sectionmust include an implementation planthat indicates what major steps,operating activities, and objectives will


be accomplished as well as a timetablefor WHEN they will be finished. Amilestone chart must be included thatindicates what specificaccomplishments (process and impact)will be completed by month over thelife of the grant using October 1, 1995,as the start date. The accomplishment ofthese tasks and objectives, as well asproblems and delays therein, will serveas the basis for quarterly progressreports to FMCS.

5. Evaluation—Applicants mustprovide for either an external evaluationor an internal assessment of the project’ssuccess in meeting its goals andobjectives. An evaluation plan must bedeveloped which briefly discusses whatbasic questions or issues the assessmentwill examine and what baseline data thecommittee staff already has or willgather for the assessment. This sectionshould be written with the application’sown goals and objectives clearly inmind and the impacts or changes thatthe effort is expected to cause.

6. Letters of Commitment—Applications must include currentletters of commitment from all proposedor existing committee participants andchairpersons. These letters shouldindicate that the participants supportthe application and will attendscheduled committee meetings. Ablanket letter signed by a committeechairperson or other official on behalf ofall members is not acceptable. Weencourage the use of individual letterssubmitted on company or unionletterhead represented by theindividual. The letters should match thenames provided under Section 3(b).

7. Other Requirements—Applicantsare also responsible for the following:

(a) the submission of data indicatingapproximately how many employeeswill be covered or represented throughthe labor-management committee;

(b) from existing committees, a copyof the exiting staffing levels, a copy ofthe by-laws, a breakout of annualoperating costs and identification of allsources and levels of current financialsupport;

(c) a detailed budget narrative basedon policies and procedures contained inthe FMCS Financial and AdministrativeGrants Manual;

(d) an assurance that the labor-management committee will notinterfere with any collective bargainingagreements; and

(e) an assurance that committeemeetings will be held at least everyother month and that written minutes ofall committee meetings will be preparedand made available to FMCS.

Selection Criteria

The following criteria will be used inthe scoring and selection of applicationsfor award:

(1) The extent to which theapplication has clearly identified theproblems and justified the needs thatthe proposed project will address.

(2) The degree to which appropriateand measurable goals and objectiveshave been developed to address theproblems/needs of the area. For existingcommittees, the extent to which thecommittee will focus on expandedefforts.

(3) The feasibility of the approachproposed to attain the goals andobjectives of the project and theperceived likelihood of accomplishingthe intended project results. Thissection will also address the degree ofinnovativeness or uniqueness of theproposed effort.

(4) The appropriateness of committeemembership and the degree ofcommitment of these individuals to thegoals of the application as indicated inthe letters of support.

(5) The feasibility and thoroughnessof the implementation plan inspecifying major milestones and targetdates.

(6) The cost effectiveness and fiscalsoundness of the application’s budgetrequest, as well as the application’sfeasibility vis-a-vis its goals andapproach.

(7) The overall feasibility of theproposed project in light of all of theinformation presented for consideration;and

(8) The value to the government of theapplication in light of the overallobjectives of the Labor-ManagementCooperation Act of 1978. This includessuch factors as innovativeness, sitelocation, cost, and other qualities thatimpact upon an applicant’s value inencouraging the labor-managementcommittee concept.

C. Eligibility

Eligible grantees include state andlocal units of government, labor-management committees (or a laborunion, management association, orcompany on behalf of a committee thatwill be created through the grant), andcertain third party private non-profitentities on behalf of one or morecommittees to be created through thegrant. Federal government agencies andtheir employees are not eligible.

Third-party private, non-profitentities which can document that amajor purpose or function of theirorganization has been the improvementof labor relations are eligible to apply.

However, all funding must be directedto the functioning of the labor-management committee, and allrequirements under Part B must befollowed. Applications from third-partyentities must document particularlystrong support and participation fromall labor and management parties withwhom the applicant will be working.Applicants from third-parties which donot directly support the operation of anew or expanded committee will not bedeemed eligible, nor will applicationssigned by entities such as law firms orother third parties failing to meet theabove criteria.

Applicants who received fundingunder this program in the past forcommittee operations are generally noteligible to apply. The only exceptionsapply to third-party grantees who seekfunds on behalf of an entirely differentcommittee.

D. AllocationsFMCS has been given an allocation of

approximately $1.25 million for thisprogram. Specific funding levels willnot be established for each type ofcommittee. Instead, the review processwill be conducted in such a manner thatat least two awards will be made in eachcategory (plant, industry, public sector,and area), providing that FMCSdetermines that at least two outstandingapplications exist in each category.After these applications are selected foraward, the remaining applications willbe considered according to meritwithout regard to category.

In addition to the competitive processidentified in the preceding paragraph,FMCS will set aside a sum not to exceedthirty percent of its appropriation to beawarded on a non-competitive basis.These funds will be used to supportindustry-specific national-scopeinitiatives and/or regional industrymodels with high potential forwidespread replication. They will alsobe used to support the Eighth NationalLabor-Management Conference inChicago, Illinois, on May 29–31, 1996.

FMCS reserves the right to retain upto an additional five percent of the FY95appropriation to contract for programsupport purposes (such as evaluation)other than administration.

E. Dollar Range and Length of Grantsand Continuation Policy

Awards to continue and expandexisting labor-management committees(i.e., in existence 12 months prior to thesubmission deadline) will be for aperiod of 12 months. If successfulprogress is made during this initialbudget period and if sufficientappropriations for expansion and


continuation projects are available,these grants may be continued for alimited time at a 40 percent cash matchratio. Initial awards to establish newlabor-management committees (i.e., notyet established or in existence less than12 months prior to the submissiondeadline), will be for a period of 18months. If successful progress is madeduring this initial budget period and ifsufficient appropriations for expansionand continuation projects are available,these grants may be continued for alimited time at a 40 percent cash matchratio. The dollar range of awards is asfollows:—Up to $35,000 in FMCS funds per

annum for existing in-plantapplicants;

—Up to $50,000 over 18 months for newin-plant committee applicants;

—Up to $75,000 in FMCS funds perannum for existing area, industry andpublic sector committee applicants;

—Up to $100,000 per 18-month periodfor new area, industry, and publicsector committee applicants.Applicants are reminded that these

figures represent maximum Federalfunds only. If total costs to accomplishthe objectives of the application exceedthe maximum allowable Federalfunding level and its required granteematch, applicants may supplementthese funds through voluntarycontributions from other sources.

F. Match Requirements and CostAllowability

Applicants for new labor-managementcommittees must provide at least 10percent of the total allowable projectcosts. Applicants for existingcommittees must provide at least 25percent of the total allowable projectcosts. All matching funds may comefrom state or local government sourcesor private sector contributions, but maygenerally not include Federal funds.Funds generated by grant-supportedefforts are considered ‘‘project income,’’and may not be used for matchingpurposes.

It will be the policy of this programto reject all requests for indirect oroverhead costs as well as ‘‘in-kind’’match contributions. In addition, grantfunds must not be used to supplantprivate or local/state government fundscurrently spent for these purposes.Funding requests from existingcommittees should focus entirely on thecosts associated with the expansionefforts. Also, under no circumstancesmay business or labor officialsparticipating on a labor-managementcommittee be compensated out of grantfunds for time spent at committee

meetings or time spent in trainingsessions. Applicants generally will notbe allowed to claim all or a portion ofexisting staff time as an expense ormatch contribution.

For a more complete discussion ofcost allowability, applicants areencouraged to consult the FY95 FMCSFinancial and Administrative GrantsManual which will be included in theapplication kit.

G. Application Submission and ReviewProcess

Applications should be signed byboth a labor and managementrepresentative and be postmarked nolater than May 13, 1995. No applicationsor supplementary materials can beaccepted after the deadline. It is theresponsibility of the applicant to ensurethat the application is correctlypostmarked by the U.S. Postal Service orother carrier. An original applicationcontaining numbered pages, plus threecopies, should be addressed to theFederal Mediation and ConciliationService, Labor-Management ProgramServices, 2100 K Street, NW,Washington, D.C. 20427. FMCS will notconsider videotaped submissions orvideo attachments to submissions.

After the deadline has passed, alleligible applications will be reviewedand scored initially by one or more PeerReview Boards. The Boards(s) willdecide which applications will berecommended for fundingconsideration. The Manager, Labor-Management Program Services, willfinalize the scoring and selectionprocess for those applicationsrecommended by the Board(s). Theindividual listed as contact person initem 6 on the application form willgenerally be the only person with whomFMCS will communicate during theapplication review process.

All FY95 grant applicants will benotified of results and all grant awardswill be made before September 30, 1995.Applications submitted after the May 13deadline date or that fail to adhere toeligibility or other major requirementswill be administratively rejected by theManager, Labor-Management ProgramServices.

H. ContactIndividuals wishing to apply for

funding under this program shouldcontact the Federal Mediation andConciliation Service as soon as possibleto obtain an application kit. These kitsand additional information orclarification can be obtained free ofcharge by contacting Linda Stubbs, LeeA. Buddendeck, or Peter L. Regner,Federal Mediation and Conciliation

Service, Labor-Management ProgramServices, 2100 K Street, NW.,Washington, DC 20427; or by calling202–606–8181.John Calhoun Wells,Director, Federal Mediation and ConciliationService.[FR Doc. 95–1890 Filed 1–26–95; 8:45 am]BILLING CODE 6732–01–M

FEDERAL RESERVE SYSTEM

Agency Forms Under Review

AGENCY: Board of Governors of theFederal Reserve System.ACTION: Request for comment; extensionof comment period.

SUMMARY: On January 5, 1995, the Boardrequested comment on proposedrevisions to the Annual Report ofForeign Banking Organizations (FR Y-7)and the Foreign Banking OrganizationConfidential Report of Operations (FR2068). The Secretary of the Board, actingunder delegated authority, has extendedthe comment period by 30 days to givethe public additional time to providecomments.DATES: Comments must be received byMarch 9, 1995.ADDRESSES: Comments may be mailed toMr. William W. Wiles, Secretary, Boardof Governors of the Federal ReserveSystem, 20th and C Streets, N.W.,Washington, D.C., 20551, or delivered tothe Board’s mail room between 8:45a.m. and 5:15 p.m., and to the securitycontrol room outside of those hours.Both the mail room and the securitycontrol room are accessible from thecourtyard entrance on 20th Streetbetween Constitution Avenue and CStreet, N.W. Comments received may beinspected in room M-P-500 between9:00 a.m. and 5:00 p.m., except asprovided in section 261.8 of the Board’sRules Regarding Availability ofInformation, 12 CFR 261.8(a).

Comments may also be submitted tothe OMB desk officer for the Board:Milo Sunderhauf, Office of Informationand Regulatory Affairs, Office ofManagement and Budget, NewExecutive Office Building, Room 3208,Washington, D.C. 20503.FOR FURTHER INFORMATION CONTACT: Acopy of the proposed form, the requestfor clearance (OMB 83-I), supportingstatement, instructions, and otherdocuments that will be placed intoOMB’s public docket files onceapproved may be requested from theagency clearance officer, Mary M.McLaughlin, Federal Reserve BoardClearance Officer (202-452-3829),Division of Research and Statistics,


Board of Governors of the FederalReserve System, Washington, D.C.20551. For the hearing impaired only,Telecommunications Device for the Deaf(TTD) Dorothea Thompson (202-452-3544), Board of Governors of the FederalReserve System, Washington, D.C.20551.SUPPLEMENTARY INFORMATION: The Boardhas received a request to extend thecomment period on the proposedrevisions to the Annual Report ofForeign Banking Organizations (FR Y-7)and Foreign Banking OrganizationConfidential Report of Operations (FR2068) (60 FR 1779, January 5, 1995). Inview of the significance of theprocedural changes that are proposed inthe reports, the Board is extending thecomment period to March 9, 1995.

By order of the Secretary of the Board,acting pursuant to delegated authority for theBoard of Governors of the Federal ReserveSystem, January 23, 1995.

William W. Wiles,Secretary of the Board.[FR. Doc. 95–2052 Filed 1–26–95; 8:45am]BILLING CODE 6210–01–F

Agency Forms Under Review

Background

Notice is hereby given of the finalapproval of proposed informationcollection(s) by the Board of Governorsof the Federal Reserve System (Board)under OMB delegated authority, as per5 CFR 1320.9 (OMB Regulations onControlling Paperwork Burdens on thePublic).FOR FURTHER INFORMATION CONTACT:Federal Reserve Board Clearance

Officer—Mary M. McLaughlin—Division of Research and Statistics,Board of Governors of the FederalReserve System, Washington, D.C.20551 (202-452-3829).

OMB Desk Officer—Milo Sunderhauf—Office of Information and RegulatoryAffairs, Office of Management andBudget, New Executive OfficeBuilding, Room 3208, Washington,D.C. 20503 (202-395-7340).Final approval under OMB delegated

authority of the extension, withrevisions, of the following reports:

1. Report title: Report of Foreign (Non-U.S.) Currency Deposits.Agency form number: FR 2915.OMB Docket number: 7100-0237.Frequency: Quarterly.Reporters: Depository institutions.Annual reporting hours: 418.Estimated average hours per response:0.50.Number of respondents: 209.Small businesses are affected.

General description of report: Thisinformation collection is required [12U.S.C. 248(a)] and is given confidentialtreatment [5 U.S.C. 552(b)(4)].

Abstract: The FR 2915 reporting formcollects weekly averages of the amountsoutstanding for foreign (non-U.S.)currency deposits held at U.S. offices ofdepository institutions, converted toU.S. dollars and included in the FR2900 (OMB No. 7100-0087), theprincipal deposits report that is used forthe calculation of required reserves andfor construction of the monetary andreserves aggregates. Foreign currencydeposits are subject to reserverequirements and, therefore, areincluded in the FR 2900. However,foreign currency deposits are notincluded in the monetary aggregates.The FR 2915 data are used to backforeign currency deposits out of the FR2900 data for construction of themonetary aggregates. The FR 2915 dataalso are used to monitor the volume offoreign-currency deposits.

The revision reduces the reportingfrequency for current monthly reportersto quarterly, which reduces the annualreporting burden for this report by 66percent.

2. Report title: Financial Statementsfor a Bank Holding Company SubsidiaryEngaged in Bank-Ineligible SecuritiesUnderwriting and Dealing.Agency form number: FR Y-20.OMB Docket number: 7100-0248.Frequency: Quarterly.Reporters: Bank Holding Companies.Annual reporting hours: 1,519.Estimated average hours per response:12.25.Number of respondents: 31.Small businesses are not affected.

General description of report: Thisinformation collection is mandatory toobtain or retain a benefit [12 U.S.C.1844(b) and (c)] and is givenconfidential treatment [5 U.S.C.552(b)(4)].

Abstract: Bank holding companiesthat have received the Board’s approvalby Order to engage in limitedunderwriting and dealing in securitiesof a type which a bank may notunderwrite or deal in directly file the FRY-20. The report consists of a balancesheet, statement of income, supportingschedules for securities owned, and astatement of changes in stockholders’equity. In addition, there are severalmemoranda items which collectinformation on intercompany liabilitiesand off-balance sheet items, andinformation that is needed for analternative measure of indexed-revenue.The revision, effective as of December31, 1994, involves the addition ofmemoranda items on the income

statement to collect year-to-date grossincome, total expenses, and net income.

Board of Governors of the Federal ReserveSystem, January 23, 1995.William W. Wiles,Secretary of the Board.[FR Doc. 95–2051 Filed 1–26–95; 8:45am]BILLING CODE 6210–01–F

MNB Corporation, et al.; Formationsof; Acquisitions by; and Mergers ofBank Holding Companies

The companies listed in this noticehave applied for the Board’s approvalunder section 3 of the Bank HoldingCompany Act (12 U.S.C. 1842) and §225.14 of the Board’s Regulation Y (12CFR 225.14) to become a bank holdingcompany or to acquire a bank or bankholding company. The factors that areconsidered in acting on the applicationsare set forth in section 3(c) of the Act(12 U.S.C. 1842(c)).

Each application is available forimmediate inspection at the FederalReserve Bank indicated. Once theapplication has been accepted forprocessing, it will also be available forinspection at the offices of the Board ofGovernors. Interested persons mayexpress their views in writing to theReserve Bank or to the offices of theBoard of Governors. Any comment onan application that requests a hearingmust include a statement of why awritten presentation would not sufficein lieu of a hearing, identifyingspecifically any questions of fact thatare in dispute and summarizing theevidence that would be presented at ahearing.

Unless otherwise noted, commentsregarding each of these applicationsmust be received not later than February21, 1995.

A. Federal Reserve Bank ofPhiladelphia (Michael E. Collins,Senior Vice President) 100 North 6thStreet, Philadelphia, Pennsylvania19105:

1. MNB Corporation, Bangor,Pennsylvania; to become a bank holdingcompany by acquiring 100 percent ofthe voting shares of The MerchantsNational Bank of Bangor, Bangor,Pennsylvania.

2. Republic Bancorporation, Inc.,Philadelphia, Pennsylvania; to become abank holding company by acquiring 100percent of the voting shares of RepublicBank, Philadelphia, Pennsylvania.

B. Federal Reserve Bank of Atlanta(Zane R. Kelley, Vice President) 104Marietta Street, N.W., Atlanta, Georgia30303:

1. Deposit Guaranty Corporation,Jackson, Mississippi; to merge with


Citizens National Bancshares, Inc.,Hammond, Louisiana, and therebyindirectly acquire Citizens NationalBank, Hammond, Louisiana.

2. SouthTrust Corporation,Birmingham, Alabama, and SouthTrustof Mississippi, Biloxi, Mississippi; tomerge with CNB Capital Corporation,Pascagoula, Mississippi, and therebyindirectly acquire Citizens NationalBank, Pascagoula, Mississippi.

3. Royal Bank Group of AcadianaPartnership, Lafayette, Louisiana; tobecome a bank holding company byacquiring 32 percent of LBA BankgroupInc., Lafayette, Louisiana, which willchange its name to Royal Bankgroup ofAcadiana Inc., Lafayette, Louisisna, andthereby indirectly acquire Bank ofLafayette, Lafayette, Louisiana and LBABank, Lafayette, Louisiana.

Bank Investors Limited Partnership,Lafayette, Louisiana owns 78 percentand Chance Investment Inc., Lafayette,Louisiana, owns 1 percent of LBABankgroup, Inc., Lafayette, Louisiana,and have applied to become bankholding companies and to acquire LBABank, Lafayette, Louisiana.

C. Federal Reserve Bank of St. Louis(Randall C. Sumner, Vice President) 411Locust Street, St. Louis, Missouri 63166:

1. Wilmot Bank Holding Company,Wilmot, Arkansas; to become a bankholding company by acquiring 70.75percent of the voting shares of WilmotState Bank, Wilmot, Arkansas.

D. Federal Reserve Bank ofMinneapolis (James M. Lyon, VicePresident) 250 Marquette Avenue,Minneapolis, Minnesota 55480:

1. Norwest Corporation, Minneapolis,Minnesota; to acquire 100 percent of thevoting shares of United Texas FinancialCorporation, Wichita Falls, Texas, andthereby indirectly acquire Parker SquareBank, N.A., Wichita Falls, Texas, andFirst State Bank, Archer City, Texas.

2. Norwest Corporation, Minneapolis,Minnesota; to acquire 100 percent of thevoting shares of Goldenbanks ofColorado, Inc., Golden, Colorado, andthereby indirectly acquire GoldenbankNational Association, Golden, Colorado;Goldenbank National Association,Englewood, Colorado; GoldenbankNational Association, Westminster,Westminster, Colorado; andGoldenbank, Applewood, Wheat Ridge,Colorado.

E. Federal Reserve Bank of Dallas(Genie D. Short, Vice President) 2200North Pearl Street, Dallas, Texas 75201-2272:

1. Cullen/Frost Bankers, Inc., SanAntonio, Texas; to merge with ValleyBancshares, Inc., McAllen, Texas, andthereby indirectly acquire The ValleyNational Bank, McAllen, Texas.

Board of Governors of the Federal ReserveSystem, January 23, 1995.Jennifer J. Johnson,Deputy Secretary of the Board.[FR Doc. 95–2053 Filed 1–26–95; 8:45 am]BILLING CODE 6210–01–F

National Bancorp, Inc.; Notice ofApplication to Engage de novo inPermissible Nonbanking Activities

The company listed in this notice hasfiled an application under § 225.23(a)(1)of the Board’s Regulation Y (12 CFR225.23(a)(1)) for the Board’s approvalunder section 4(c)(8) of the BankHolding Company Act (12 U.S.C.1843(c)(8)) and § 225.21(a) of RegulationY (12 CFR 225.21(a)) to commence or toengage de novo, either directly orthrough a subsidiary, in a nonbankingactivity that is listed in § 225.25 ofRegulation Y as closely related tobanking and permissible for bankholding companies. Unless otherwisenoted, such activities will be conductedthroughout the United States.

The application is available forimmediate inspection at the FederalReserve Bank indicated. Once theapplication has been accepted forprocessing, it will also be available forinspection at the offices of the Board ofGovernors. Interested persons mayexpress their views in writing on thequestion whether consummation of theproposal can ‘‘reasonably be expected toproduce benefits to the public, such asgreater convenience, increasedcompetition, or gains in efficiency, thatoutweigh possible adverse effects, suchas undue concentration of resources,decreased or unfair competition,conflicts of interests, or unsoundbanking practices.’’ Any request for ahearing on this question must beaccompanied by a statement of thereasons a written presentation wouldnot suffice in lieu of a hearing,identifying specifically any questions offact that are in dispute, summarizing theevidence that would be presented at ahearing, and indicating how the partycommenting would be aggrieved byapproval of the proposal.

Comments regarding the applicationmust be received at the Reserve Bankindicated or the offices of the Board ofGovernors not later than February 10,1995.

A. Federal Reserve Bank of Chicago(James A. Bluemle, Vice President) 230South LaSalle Street, Chicago, Illinois60690:

1. National Bancorp, Inc.,Streamwood, Illinois; to engage de novothrough its subsidiary National BancorpData System, Inc., Melrose Park, Illinois,

in providing data processing and relatedservices for Applicant’s subsidiaries:AmericanMidwest Bank & Trust,Melrose Park, Illinois, and AmericanNational Bank of DeKalb County,Sycamore, Illinois, and also Applicant’saffiliate bank: First Bank ofSchaumburg, Inc., Schaumburg, Illinois,pursuant to § 225.25(b)(7) of the Board’sRegulation Y.


Norwest Corporation, et al.;Acquisitions of Companies Engaged inPermissible Nonbanking Activities

The organizations listed in this noticehave applied under § 225.23(a)(2) or (f)of the Board’s Regulation Y (12 CFR225.23(a)(2) or (f)) for the Board’sapproval under section 4(c)(8) of theBank Holding Company Act (12 U.S.C.1843(c)(8)) and § 225.21(a) of RegulationY (12 CFR 225.21(a)) to acquire orcontrol voting securities or assets of acompany engaged in a nonbankingactivity that is listed in § 225.25 ofRegulation Y as closely related tobanking and permissible for bankholding companies. Unless otherwisenoted, such activities will be conductedthroughout the United States.

Each application is available forimmediate inspection at the FederalReserve Bank indicated. Once theapplication has been accepted forprocessing, it will also be available forinspection at the offices of the Board ofGovernors. Interested persons mayexpress their views in writing on thequestion whether consummation of theproposal can ‘‘reasonably be expected toproduce benefits to the public, such asgreater convenience, increasedcompetition, or gains in efficiency, thatoutweigh possible adverse effects, suchas undue concentration of resources,decreased or unfair competition,conflicts of interests, or unsoundbanking practices.’’ Any request for ahearing on this question must beaccompanied by a statement of thereasons a written presentation wouldnot suffice in lieu of a hearing,identifying specifically any questions offact that are in dispute, summarizing theevidence that would be presented at ahearing, and indicating how the partycommenting would be aggrieved byapproval of the proposal.

Unless otherwise noted, commentsregarding each of these applicationsmust be received at the Reserve Bank


indicated for the application or theoffices of the Board of Governors notlater than

A. Federal Reserve Bank ofMinneapolis (James M. Lyon, VicePresident) 250 Marquette Avenue,Minneapolis, Minnesota 55480:

1. Norwest Corporation, Minneapolis,Minnesota; to acquire Stan-ShawCorporation, Anaheim Hills, California,and thereby engage in acting as trusteeunder deeds of trust, preparing andfiling notices of default, reconveyancesand related documents, pursuant to §225.25(b)(3) of the Board’s Regulation Y.

2. Norwest Corporation, Minneapolis,Minnesota; to acquire DirectorsMortgage Loan Corporation, Riverside,California, and thereby engage in (1) theorigination, sale and servicing ofresidential single-family, first mortgageloans, the retention, purchase and saleof servicing rights associates with suchmortgage loans, pursuant to §225.25(b)(1) of the Board’s Regulation Y,and (2) the acquisition of 24.6 percentof Mission Savings and LoanAssociation, Riverside, California,pursuant to § 225.25(b)(9) of the Board’sRegulation Y.

3. Norwest Corporation, Minneapolis,Minnesota; to acquire DirectorsInsurance Service, Riverside, California,and thereby engage in (1) providing, asagent for various insuranceunderwriters, a full line of homemortgage insurance products, includingmortgage life, flood, and earthquakeinsurance, pursuant to section 4(c)(8)(G)of the Bank Holding Company Act.


John William Staley; Change in BankControl Notice

Acquisition of Shares of Banks orBank Holding Companies

The notificant listed below hasapplied under the Change in BankControl Act (12 U.S.C. 1817(j)) and §225.41 of the Board’s Regulation Y (12CFR 225.41) to acquire a bank or bankholding company. The factors that areconsidered in acting on notices are setforth in paragraph 7 of the Act (12U.S.C. 1817(j)(7)).

The notice is available for immediateinspection at the Federal Reserve Bankindicated. Once the notice has beenaccepted for processing, it will also beavailable for inspection at the offices ofthe Board of Governors. Interested

persons may express their views inwriting to the Reserve Bank indicatedfor the notice or to the offices of theBoard of Governors. Comments must bereceived not later than February 10,1995.

A. Federal Reserve Bank of Atlanta(Zane R. Kelley, Vice President) 104Marietta Street, N.W., Atlanta, Georgia30303:

1. John William Staley, Nashville,Tennessee; to retain 10.66 percent of thevoting shares of First PikevilleBancshares, Inc., Pikeville, Tennessee,and thereby retain shares of FirstNational Bank of Pikeville, Pikeville,Tennessee.


FEDERAL TRADE COMMISSION

[File No. 921–0071]

Del Monte Foods Company, et al.;Proposed Consent Agreement WithAnalysis to Aid Public Comment

AGENCY: Federal Trade Commission.ACTION: Proposed consent agreement.

SUMMARY: In settlement of allegedviolations of federal law prohibitingunfair acts and practices and unfairmethods of competition, this consentagreement, accepted subject to finalCommission approval, would require,among other things, the California-basedcorporations to obtain, for ten years,Commission approval before acquiringany stock or assets of a United Statescanned fruit manufacturer, and beforeentering into a variety of marketing,packing, or other agreements withcompetitors.DATES: Comments must be received onor before March 28, 1995.ADDRESSES: Comments should bedirected to: FTC/Office of the Secretary,Room 159, 6th Street and PennsylvaniaAvenue, NW., Washington, DC 20580.FOR FURTHER INFORMATION CONTACT:Ronald Rowe, FTC/S–2105,Washington, DC 20580. (202) 326–2610.SUPPLEMENTARY INFORMATION: Pursuantto Section 6(f) of the Federal TradeCommission Act, 38 Stat. 721, 15 U.S.C.46 and Section 2.34 of the Commission’sRules of Practice (16 CFR 2.34), noticeis hereby given that the followingconsent agreement containing a consentorder to cease and desist, having beenfiled with and accepted, subject to final

approval, by the Commission, has beenplaced on the public record for a periodof sixty (60) days. Public comment isinvited. Such comments or views willbe considered by the Commission andwill be available for inspection andcopying at its principal office inaccordance with Section 4.9(b)(6)(ii) ofthe Commission’s Rules of Practice (16CFR 4.9(b)(6)(ii).

In the Matter of DEL MONTE FOODSCOMPANY, a corporation; DEL MONTECORPORATION, a corporation; and PACIFICCOAST PRODUCERS, a corporation, File No.921–0071.

Agreement Containing Consent OrderThe Federal Trade Commission

(‘‘Commission’’) having initiated aninvestigation of certain agreementsentered into by Del Monte Corporation,a wholly-owned subsidiary of DelMonte Foods Company (hereinaftercollectively referred to as ‘‘Del Monte’’),and Pacific Coast Producers (‘‘PCP’’),and it now appearing that Del Monteand PCP, hereinafter sometimes referredto as ‘‘proposed respondents,’’ arewilling to enter into an agreementcontaining an order (‘‘Agreement’’) toterminate such agreements between DelMonte and PCP, to cease and desist fromcertain acts, and to provide for certainother relief,

It is hereby agreed by and amongproposed respondents, by their dulyauthorized officers and attorneys, andcounsel for the Federal TradeCommission that:

1. Proposed respondent Del MonteCorporation, a wholly-owned subsidiaryof Del Monte Foods Company, is acorporation organized, existing, anddoing business under and by virtue ofthe laws of the State of New York, withits office and principal place of businesslocated at One Market Plaza, SanFrancisco, California 94119.

2. Proposed respondent Del MonteFoods Company is a corporationorganized, existing, and doing businessunder and by virtue of the laws of theState of Maryland, with its office andprincipal place of business at OneMarket Plaza, San Francisco, California94119.

3. Proposed respondent Pacific CoastProducers is a corporation organized,existing, and doing business under andby virtue of the laws of the State ofCalifornia, with its office and principalplace of business at 631 N. CluffAvenue, Lodi, California 95240.

4. Proposed respondents admit all thejurisdictional facts set forth in the draftof complaint.

5. Proposed respondents waive:a. any further procedural steps;b. the requirement that the

Commission’s decision contain a


statement of findings of fact andconclusions of law;

c. all rights to seek judicial review orotherwise to challenge or contest thevalidity of the order entered pursuant tothis Agreement; and

d. any claim under the Equal Accessto Justice Act.

6. 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 draft ofcomplaint 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 proposedrespondents, 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.

7. This Agreement is for settlementpurposes only and does not constitutean admission by the proposedrespondents that the law has beenviolated as alleged in the draft of thecomplaint, or that the facts as alleged inthe draft complaint, other thanjurisdictional facts, are true.

8. This Agreement contemplates that,if it 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 theproposed respondents, (1) issue itscomplaint corresponding in form andsubstance with the draft of complaintand its decision containing thefollowing order to terminate certainagreements entered into between DelMonte and PCP and to cease and desistin disposition of the proceeding, and (2)make information public with respectthereto. When so entered, the ordershall have the same force and effect andmay be altered, modified, or set aside inthe same time provided by statute forother orders. The order shall becomefinal upon service. Delivery by theUnited States Postal Service of thecomplaint and decision containing theagreed-to order to proposedrespondents’ addresses as stated in thisAgreement shall constitute service.Proposed respondents waive any rightthey may have to any other manner ofservice. The complaint may be used inconstruing the terms of the order, andno agreement, understanding,representation, or interpretation not

contained in the order or the Agreementmay be used to vary or contradict theterms of the order.

9. Proposed respondents have readthe proposed complaint and ordercontemplated hereby. Proposedrespondents understand that once theorder has been issued, they will berequired to file verified written reportsshowing they have fully complied withthe order. Proposed respondents furtherunderstand that they may be liable forcivil penalties in the amount providedby law for each violation of the orderafter it becomes final.

Order

I

It is ordered that, as used in thisorder, the following definitions shallapply.

A. ‘‘Del Monte Corporation’’ meansDel Monte Corporation, its predecessors,subsidiaries, divisions, groups andaffiliates controlled by Del MonteCorporation, and their respectivedirectors, officers, employees, agents,and their respective successors andassigns.

B. ‘‘Del Monte‘‘ means Del MonteFoods Company, its predecessors,subsidiaries (including Del MonteCorporation), divisions, groups andaffiliates controlled by Del Monte FoodsCompany, and their respective directors,officers, employees, agents, and theirrespective successors and assigns.

C. ‘‘PCP’’ means Pacific CoastProducers, its predecessors,subsidiaries, divisions, groups andaffiliates controlled by Pacific CoastProducers, and their respectivedirectors, officers, employees, members,agents, and their respective successorsand assigns.

D. ‘‘Respondents’’ means PCP and DelMonte (including Del MonteCorporation).

E. ‘‘Commission’’ means the FederalTrade Commission.

F. ‘‘Canned Fruit’’ means peaches,pears, fruit cocktail, and fruit mix,which consists primarily of dicedpeaches and diced pears, that areprocessed and canned.

G. ‘‘Option Agreement’’ means theOption Agreement between Del MonteCorporation and Pacific Coast Producersentered into on May 4, 1992, pursuantto which Del Monte acquired and PCPconveyed an exclusive and irrevocableoption to purchase certain rights in, andtitle to, certain assets of PCP, includinglong term contracts with growers.

H. ‘‘Supply Agreement’’ means theSupply Agreement between Del MonteCorporation and Pacific Coast Producersentered into on May 4, 1992, pursuant

to which Del Monte agreed to purchasevirtually all of PCP’s output of CannedFruit, canned tomatoes, and cannedapricots.

I. ‘‘Spot Market’’ means ad hoc inter-canner transactions for Canned Fruitplaced on an irregular basis where allCanned Fruit ordered under such anarrangement is delivered within nineweeks of placing the order.

J. ‘‘Tri Valley Growers’’ means TriValley Growers, its predecessors,subsidiaries, divisions, groups andaffiliates controlled by Tri ValleyGrowers, and their respective directors,officers, employees, members, agents,and their respective successors andassigns.

II

It is further ordered that:A. Within three (3) days after the date

this order becomes final, Respondentsshall terminate the Option Agreement;

B. Within three (3) days after the datethis order becomes final, Respondentsshall declare null and void thefollowing paragraphs of the SupplyAgreement: Paragraph 2, subparagraphs(b), (c), (e), and (f), Paragraph 23,Paragraph 24, and Paragraph 25 as itrelates to the budget for canning afterJune 30, 1995; and

C. On or before June 30, 1995,Respondents shall absolutely and ingood faith terminate the SupplyAgreement.

III

It is further ordered that, for a periodof ten (10) years from the date this orderbecomes final, Del Monte shall not,without the prior approval of theCommission, directly or indirectly,through subsidiaries, partnerships, orotherwise:

A. Acquire any stock, share capital,equity, or other interest in any concern,corporate or non-corporate, engaged, atthe time of such acquisition or withinthe two years preceding suchacquisition, in the manufacture of anytype of Canned Fruit in the UnitedStates; provided, however, that anacquisition shall be exempt from therequirements of this paragraph if it issolely for the purpose of investment andDel Monte will not hold more than onepercent of the shares of any publiclytraded class of security; or

B. Acquire any assets, other than inthe ordinary course of business, used foror used anytime within the two yearspreceding such acquisition for (and stillsuitable for use for) the manufacture ofany type of Canned Fruit in the UnitedStates; provided, however, that anacquisition of assets will be exemptfrom the requirements of this paragraph


if the purchase price of the assets-to-be-acquired does not exceed $1,500,000.00,and the purchase price of all assets usedfor, or previously used for (and stillsuitable for use for) the manufacture ofany type of Canned Fruit in the UnitedStates that Del Monte has acquired fromthe same person (as that term is definedin the premerger notification rules, 16C.F.R. § 801.1(a)(1)) in the twelve-monthperiod preceding the proposedacquisition, when aggregated with thepurchase price of the to-be-acquiredassets, does not exceed $1,500,000.

IVIt is further ordered that, for a period

of ten (10) years from the date this orderbecomes final, unless Del Monte isrequired to seek prior approval from theCommission pursuant to Paragraph III,and unless Del Monte has obtained suchprior approval, Del Monte shall not,without providing advance writtennotification to the Commission, directlyor indirectly, through subsidiaries,partnerships, or otherwise, acquire anyassets, other than in the ordinary courseof business, used for or used anytimewithin the two years preceding suchacquisition for (and still suitable for usefor) the manufacture of any type ofCanned Fruit in the United States.

The notification required by thisparagraph shall be provided to theCommission at least thirty (30) daysprior to the acquisition. Suchnotification shall include a descriptionof the assets to be acquired, thepurchase price, the name of the personfrom whom the assets are to beacquired, including the name of theindividual employed by such personthat is most knowledgeable about theproposed acquisition, Del Monte’spurpose in acquiring the assets fromsuch person, and the use to which DelMonte intends to put such assets. DelMonte shall comply with reasonablerequests from Commission staff foradditional information within ten (10)days of service of such requests.

VIt is further ordered that, for a period

of ten (10) years from the date this orderbecomes final, Del Monte shall not,without the prior approval of theCommission, directly or indirectly,through subsidiaries, partnerships, orotherwise:

A. Except with respect to agreementscovered by Paragraphs V.B, VI, VII, andVIII, enter into any agreement or otherarrangement to purchase or market anytype of Canned Fruit with any corporateor non-corporate entity, engaged, at thetime of entering into such agreement orother arrangement or within two years

preceding entering into such agreementor other arrangement, in themanufacture of any type of Canned Fruitin the United States; provided, however,that entering into such an agreement orother arrangement will be exempt fromthe requirements of this paragraph if theagreement or other arrangement is forthe purchase of Canned Fruit on theSpot Market; or

B. Enter into any agreement or otherarrangement with Tri Valley Growers tohave any type of Canned Fruitmanufactured on Del Monte’s behalf.

VIIt is further ordered that:A. for a period of five (5) years from

the date this order becomes final, DelMonte shall not, without the priorapproval of the Commission, directly orindirectly, through subsidiaries,partnerships, or otherwise, except withrespect to agreements covered byParagraphs V, VII, and VIII, enter intoany agreement or other arrangement tohave any type of Canned Fruitmanufactured on Del Monte’s behalf(‘‘co-pack agreement’’) with anycorporate or non-corporate entity,engaged, at the time of entering intosuch co-pack agreement or within thetwo years preceding entering into suchco-pack agreement, in the manufactureof any type of Canned Fruit in theUnited States;

B. For a period beginning on the fifthanniversary of the date this orderbecomes final until ten years from thedate this order becomes final, Del Monteshall not, without providing advancewritten notification to the Commission,directly or indirectly, throughsubsidiaries, partnerships, or otherwise,except with respect to agreementscovered by Paragraphs V, VII, and VIII,enter into any agreement or otherarrangement to have any type of CannedFruit manufactured on Del Monte’sbehalf (‘‘co-pack agreement’’) with anycorporate or non-corporate entity,engaged, at the time of entering intosuch co-pack agreement or within thetwo years preceding entering into suchco-pack agreement, in the manufactureof any type of Canned Fruit in theUnited States. Said notification shall beprovided to the Commission by DelMonte thirty (30) days before the entitybegins manufacturing the Canned Fruitpursuant to such co-pack agreement.Said notification shall include a copy ofthe proposed co-pack agreement and allschedules and attachments. Del Monteshall comply with reasonable requestsfrom Commission staff for additionalinformation concerning such co-packagreements within ten (10) days ofservice of such requests.

VII

It is further ordered that, for a periodof ten (10) years from the date this orderbecomes final, Respondents shall not,without the prior approval of theCommission, directly or indirectly,through subsidiaries, partnerships, orotherwise, enter into an agreementrequiring PCP to manufacture any typeof Canned Fruit on behalf of Del Monte(‘‘co-pack agreement’’); provided,however, that such a co-pack agreementbetween Del Monte and PCP will beexempt from the requirements of thisparagraph if the aggregate of all co-packagreements entered into in any calendaryear meet all of the following criteria: 1)the amount of retail sizes (net weightunder two pounds) does not exceed tenpercent of PCP’s output of Canned Fruit,measured in basic cases (24 21⁄2 cansizes), manufactured in the same year asthe Canned Fruit manufacturedpursuant to the co-pack agreements; 2)the amount of peaches grown by PCPused for the co-pack agreements doesnot exceed 8,000 tons in any year andnone of PCP’s peaches is used for retailsizes manufactured pursuant to the co-pack agreements, and 3) the totalamount of the Canned Fruitmanufactured pursuant to the co-packagreements a) in each of the years 1995and 1996 constitutes forty (40) percentor less of PCP’s output of Canned Fruitmanufactured in each of those years,measured in basic cases; and b) in eachyear thereafter constitutes thirty (30)percent or less of PCP’s output ofCanned Fruit manufactured in that year,measured in basic cases.

VIII

It is further ordered that, for a periodof ten (10) years from the date this orderbecomes final, unless Respondents arerequired to seek prior approval from theCommission pursuant to Paragraph VI,and unless Respondents have obtainedsuch prior approval, Respondents shallnot, without providing advance writtennotification to the Commission, directlyor indirectly, through subsidiaries,partnerships, or otherwise, enter into aco-pack agreement with each other. Saidnotification shall be provided to theCommission by PCP on or before March1 of each year in which Del Monte andPCP plan to enter into a co-packagreement. Said notification shallinclude a copy of the proposed co-packagreement, all schedules andattachments, the amount of the plannedco-pack stated in basic areas (24 21⁄2 cansizes) and the amount, stated in basiccases, for PCP’s planned production ofCanned Fruit for the same year.


IXIt is further ordered that:A. Within thirty (30) days after the

date this order becomes final and everysixty (60) days thereafter until theSupply Agreement is terminated,Respondents shall submit to theCommission a verified written reportsetting forth in detail the steps taken tocomply with Paragraph II of the order;and

B. One year (1) from the date thisorder becomes final, annually for thenext nine (9) years on the anniversary ofthe date this order becomes final, and atsuch other times as the Commissionmay require, Respondents shall file averified written report with theCommission setting forth in detail themanner and form in which each hascomplied and is complying with theprovisions of this order.

XIt is further ordered that each of the

Respondents shall notify theCommission at least thirty (30) daysprior to any proposed change in suchRespondent such as dissolution,assignment, or sale resulting in theemergence of a successor corporation, orthe creation or dissolution ofsubsidiaries or any other change in suchRespondent that may affect complianceobligations arising out of the order.

XIIt is further ordered that, for the

purpose of determining or securingcompliance with this order, and subjectto any legally recognized privilege,upon written request and on reasonablenotice to Respondents, each of theRespondents shall permit any dulyauthorized representative of theCommission.

A. Access, during office hours and inthe presence of counsel, to inspect andcopy all books, ledgers, accounts,correspondence, memoranda and otherrecords and documents in thepossession or under the control of suchRespondent relating to any matterscontained in this order; and

B. Upon five days’ notice to suchRespondent and without restraint orinterference from it, to interviewofficers, directors, or employees of suchRespondent, who may have counselpresent, regarding such matters.

Analysis To Aid Public Comment on theProvisionally Accepted Consent Order

The Federal Trade Commission (‘‘theCommission’’) has accepted for publiccomment from Del Monte FoodsCompany, Del Monte Corporation (‘‘DelMonte’’), and Pacific Coast Producers(‘‘PCP’’) and agreement containing

consent order. This agreement has beenplaced on the public record for sixtydays for reception of comments frominterested persons.

Comments received during this periodwill become part of the public record.After sixty days, the Commission willagain review the agreement and thecomments received and will decidewhether it should withdraw from theagreement or make final the agreement’sorder.

The Commission’s investigation ofthis matter concerns a supply agreementbetween Del Monte and PCP thatcommenced in July of 1992. The effectof the supply agreement was that DelMonte acquired the business of PCP,and PCP was no longer a competitor inthe market for canned peaches, pears,fruit cocktail, and fruit mix (‘‘cannedfruit’’). The supply agreement alsocontained an option agreement bywhich Del Monte had the right topurchase PCP outright. The agreementcontaining consent order would, iffinally accepted by the Commission,settle charges alleged in theCommission’s complaint that the supplyagreement and option agreementsubstantially lessened competition inthe sale of canned fruit in the UnitedStates and that Del Monte entered intosuch agreements with the effect ofrestraining, lessening, or eliminatingcompetition, or acquiring ormaintaining market power in the samemarket. The Commission’s complaintfurther alleges that such agreements hadand will have anticompetitive effectsand that, in entering into suchagreements, respondents violatedSection 7 of the Clayton Act and Section5 of the Federal Trade Commission Act.

The order accepted for publiccomment contains provisions thatwould require that Del Monte and PCPterminate the supply agreement in Juneof 1995 and terminate the optionagreement and certain provisions of thesupply agreement within three daysafter the date the order becomes final.The provisions of the supply agreementthat would require termination withinthree days relate to planning for the1995 canning season. The purpose ofthe delay in terminating the entiresupply agreement is to assure theorderly return of PCP to the market asa viable operation engaged in the sale ofcanned fruit in the United States. Thedelay permits PCP time to plan for themanufacture of fruit for the 1995canning season and obtain customers forthat fruit, without the pressure ofmarketing last year’s inventory.

For a period of ten years from the datethe order becomes final, the orderwould also prohibit Del Monte from

acquiring, without prior Commissionapproval, stock in or assets of an entityengaged in the manufacture of any typeof canned fruit in the United States.Acquisitions, for investment purposesonly, of less than 1% of the outstandingstock of a publicly-traded companywould be exempt from the priorapproval provision.

Acquisitions of certain assets valuedat less than $1.5 million would also beexempt from the prior approvalprovision, but the order would requirethat Del Monte give 30 days’ notice tothe Commission before consummatingthe acquisition.

For a period of ten years from the datethe order becomes final, the orderwould also prohibit Del Monte, withoutobtaining prior Commission approval,from entering into an agreement to buycanned fruit from, or market cannedfruit for, a person engaged in themanufacture of canned fruit in theUnited States. Del Monte would not,however, have to obtain priorCommission approval for purchasesmade on the spot market.

For a period of ten years from the datethe order becomes final, the orderwould also prohibit Del Monte, withoutobtaining prior Commission approval,from having canned fruit packed on DelMonte’s behalf (‘‘co-pack’’) by Tri ValleyGrowers or PCP. Tri Valley Growers isa large manufacturer of canned fruit. DelMonte and PCP may enter into a co-packagreement for canned fruit, withoutobtaining prior Commission approval, ifthe following conditions are met: (1)The amount of PCP’s peaches used inthe co-pack for Del Monte does notexceed 8,000 tons in any year; (2) theamount or retail sizes packed under theco-pack does not exceed 10% of PCP’soutput; (3) the total amount of the co-pack does not exceed 40% of PCP’soutput in each of the first two years afterthe order becomes final and 30% ofPCP’s output in each year thereafter.Prior to entering into the supplyagreement that is the subject of thiscompliant, PCP co-packed canned fruitfor Del Monte.

For a period of five years from thedate the order becomes final, the orderwould also prohibit Del Monte, withoutobtaining prior Commission approval,from having canned fruit packed on DelMonte’s behalf (‘‘co-pack’’) by any entityengaged in the manufacture of cannedfruit. In years six through ten, DelMonte would have to provide priornotice to the Commission of such a co-pack, but would not need to obtain priorapproval.

The purpose of this analysis is toinvite public comment concerning theconsent order and any other aspect of


this matter. This analysis is notintended to constitute an officialinterpretation of the agreement andorder or to modify its terms in any way.Donald S. Clark,Secretary.

Concurring Statement of CommissionerRoscoe B. Starek, III

In the Matter of Del Monte FoodsCompany/Pacific Coast Producers, File No.921 0071.

In voting to accept the agreementcontaining consent order in this matter, Ihave overcome my reluctance to support anorder that at first blush appeared to containcertain inordinately regulatory provisions. Asa general proposition, I prefer clear, simple,easily enforceable cease-and-desist languageover orders that establish complex metes andbounds for permissible conduct.

Some provisions of the present order—Paragraph VII is the extreme example—seemto prescribe the behavior of Del Monte andPacific Coast Producers (‘‘PCP’’) with anunfortunate degree of detail. Despite thedetailed nature of those provisions, however,the order is unlikely to place undueconstraints on the parties’ operations. Inparticular, the ‘‘regulatory’’-looking provisoto Paragraph VII clearly constitutes asubstantial accommodation—i.e., anexception to what would otherwise be amoratorium on co-pack arrangementsbetween Del Monte and PCP—designed toallow the parties to realize efficiencies. Tothe extent that the parties need even morelatitude than that proviso affords, ParagraphVII allows them to seek the Commission’sapproval for a more extensive co-packarrangement. Thus, if the parties wish toexpand their co-pack agreement beyond whatthe proviso to Paragraph VII contemplates,the paragraph operates as it should: it putson the parties the burden of establishing thata more extensive arrangement will yield netefficiencies.


[File No. 951 0007]

HEALTHSOUTH RehabilitationCorporation; Proposed ConsentAgreement With Analysis To AidPublic Comment


SUMMARY: In settlement of allegedviolations of federal law prohibitingunfair acts and practices and unfairmethods of competition, this consentagreement, accepted subject to finalCommission approval, would require,among other things, HEALTHSOUTH,an Alabama-based corporation, to divestNashville Rehabilitation Hospital andrelated assets in Nashville, TN. withintwelve months to a Commissionapproved entity. If the divestiture is not

completed on time, the Commissionwould be permitted to appoint a trusteeto complete the transaction. In addition,the consent agreement would requireHEALTHSOUTH to terminatemanagement contracts to operaterehabilitation units at Medical CenterEast in Birmingham, AL. and RoperHospital in Charleston, S.C. Also, theconsent agreement would requireHEALTHSOUTH, for ten years, to obtainCommission approval before merging,by acquisition, lease, managementcontract or otherwise, any of itsrehabilitation hospital facilities in anyof the three areas with any competingfacilities in those areas.DATES: Comments must be received onor before March 28, 1995.ADDRESSES: Comments should bedirected to: FTC/Office of the Secretary,Room 159, 6th St. and Pa. Ave., N.W.,Washington, D.C. 20580.FOR FURTHER INFORMATION CONTACT:Mark Horoschak or Oscar Voss, FTC/S–3115, Washington, D.C. 20580. (202)326–2756 or 326–2750.SUPPLEMENTARY INFORMATION: Pursuantto Section 6(f) of the Federal TradeCommission Act, 38 Stat. 721, 15 U.S.C.46 and Section 2.34 of the Commission’sRules of Practice (16 CFR 2.34), noticeis hereby given that the followingconsent agreement containing a consentorder to cease and desist, having beenfiled with and accepted, subject to finalapproval, by the Commission, has beenplaced on the public record for a periodof sixty (60) days. Public comment isinvited. Such comments or views willbe considered by the Commission andwill be available for inspection andcopying at its principal office inaccordance with Section 4.9(b)(6)(ii) ofthe Commission’s Rules of Practice (16CFR 4.9(b)(6)(ii)).

In the matter of HEALTHSOUTHREHABILITATION CORPORATION, acorporation,

Agreement Containing Consent Order

The Federal Trade Commission(‘‘Commission’’), having initiated aninvestigation of the proposed merger ofReLife, Inc. with HEALTHSOUTHRehabilitation Corporation(‘‘HEALTHSOUTH’’), and it nowappearing that HEALTHSOUTH,hereinafter sometimes referred to as‘‘proposed respondent,’’ is willing toenter into an agreement containing anorder to divest certain assets and tocease and desist from making certainacquisitions, and providing for otherrelief:

It is hereby agreed by and between theproposed respondent, by its duly

authorized officer and attorney, andcounsel for the Commission that:

1. Proposed respondentHEALTHSOUTH is a corporationorganized, existing, and doing businessunder and by virtue of the laws of theState of Delaware, with its office andprincipal place of business located atTwo Perimeter Park South, Birmingham,Alabama 35243.

2. Proposed respondent admits all thejurisdictional facts set forth in the draftof complaint.

3. Proposed respondent waives:a. Any further procedural steps;b. The requirement that the

Commission’s decision contain astatement of findings of fact andconclusions of law;

c. All rights to seek judicial review orotherwise 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 draft ofcomplaint 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 the proposedrespondent that the law has beenviolated as alleged in the draft ofcomplaint or that the facts as alleged inthe draft complaint, other thanjurisdictional facts, are true.

6. This agreement contemplates that,if it 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 theproposed respondent, (1) issue itscomplaint corresponding in form andsubstance with the draft of complaintand its decision containing thefollowing order to divest and to ceaseand desist in disposition of theproceeding, and (2) make informationpublic with respect thereto. When soentered, the order shall have the same


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 right itmay 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. Proposedrespondent understands that once theorder has been issued, it will berequired to file one or more compliancereports showing that it has fullycomplied 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

I

It is ordered, that as used in thisorder, the following definitions shallapply:

A. ‘‘Respondent’’ or‘‘HEALTHSOUTH’’ meansHEALTHSOUTH RehabilitationCorporation, its predecessors,subsidiaries, divisions, andpartnerships, joint ventures, groups, andaffiliates controlled byHEALTHSOUTH; their respectivedirectors, officers, employees, agents,and representatives; and their respectivesuccessors and assigns.

B. The ‘‘Acquisition’’ means themerger of ReLife, Inc. withHEALTHSOUTH, pursuant to theirmerger agreement dated September 18,1994.

C. ‘‘Rehabilitation hospital facility’’means a hospital, or distinct part thereofor unit therein with beds licensed ashospital beds, that specializes in theprovision of comprehensive, acuteinpatient medical rehabilitation care topatients requiring intensive,multidisciplinary rehabilitationtreatment programs, such as patientssuffering from stroke, head injury,spinal cord injury, amputation, severefractures, or neuromuscular diseases.

D. To ‘‘acquire’’ a rehabilitationhospital facility means to directly or

indirectly, through subsidiaries,partnerships, or otherwise, acquire thewhole or any part of the stock, sharecapital, equity, or other interest in aperson who operates the rehabilitationhospital facility; acquire any assets ofthe rehabilitation hospital facility; enterinto any agreement or other arrangementto obtain direct or indirect ownership,management, or control of therehabilitation hospital facility or anypart thereof, including but not limitedto, a lease of or management contract forany such rehabilitation hospital facility,or an agreement to replace therehabilitation hospital facility with anew rehabilitation hospital facility to beoperated by respondent; or acquire orotherwise obtain the right to designate,directly or indirectly, directors ortrustees of any rehabilitation hospitalfacility.

E. To ‘‘operate’’ a rehabilitationhospital facility means to own, lease,manage, or otherwise control or directthe operations of a rehabilitationhospital facility, directly or indirectly.

F. ‘‘Affiliate’’ means any entity whosemanagement and policies are controlledin any way, directly or indirectly, by theperson with whom it is affiliated.

G. ‘‘Relevant market area’’ means eachof the following areas:

1. The ‘‘Birmingham metropolitanarea,’’ consisting of Blount, Jefferson, St.Clair, and Shelby counties in Alabama;

2. The ‘‘Charleston metropolitanarea,’’ consisting of Berkeley,Charleston, and Dorchester counties inSouth Carolina; and

3. The ‘‘Nashville metropolitan area,’’consisting of Cheatham, Davidson,Dickson, Robertson, Rutherford,Summer, Williamson, and Wilsoncounties in Tennessee.

H. ‘‘Person’’ means any naturalperson, partnership, corporation,company, association, trust, jointventure, or other business or legalentity, including any governmentalagency.

I. ‘‘Commission’’ means the FederalTrade Commission.

J. ‘‘Material confidential information’’means competitively sensitive orproprietary information notindependently known to respondentfrom sources other than therehabilitation hospital facility to whichthat information pertains, including butnot limited to customer lists, price lists,marketing methods, patents,technologies, processes, or other tradesecrets.

II

It is further ordered that:A. Respondent shall divest, absolutely

and in good faith, within twelve (12)

months of the date this order becomesfinal, all of its rights, title, and interestsin and to all tangible and intangibleassets, businesses, goodwill, properties,lands, licenses, and leases relating toNashville Rehabilitation Hospital, ageneral acute care hospital in Nashville,Tennessee which contains arehabilitation hospital facility (‘‘assetsto be divested’’). Respondent shalldivest the assets only to an acquirer oracquirers that receive the prior approvalof the Commission, and only in amanner that receives the prior approvalof the Commission, and only in amanner that receives the prior approvalof the Commission. Respondent may,but is not required to, divest to saidacquirer(s) the management contractunder which ReLife, Inc. operates therehabilitation hospital facility atSumner Memorial Hospital in Gallatin,Tennessee, or otherwise transferoperation of that facility to saidacquirer(s), if Sumner Memorialconsents to the transfer. The purpose ofthe divestiture is to ensure thecontinuation of the rehabilitationhospital facility of NashvilleRehabilitation Hospital as an ongoing,viable rehabilitation hospital facility,and to remedy the lessening ofcompetition resulting from theAcquisition as alleged in theCommission’s complaint.

B. Respondent shall unconditionallyterminate, absolutely and in good faith,the following management contracts,and cease operating the rehabilitationhospital facilities to which thosecontracts pertain:

1. By no later than October 1, 1995,the Rehabilitation Unit ManagementAgreement between ReLife, Inc. andRoper Hospital, dated December 6,1991, under which ReLife operates therehabilitation hospital facility at RoperHospital in Charleston, South Carolina;and

2. Within ninety (90) days of the datethis order becomes final, the ConsultingServices Contract betweenHEALTHSOUTH Rehabilitation Corp.and Medical Center East, Inc. datedJanuary 1, 1990, as amended, underwhich HEALTHSOUTH operates therehabilitation hospital facility atMedical Center East in Birmingham,Alabama.

Provided, however, that respondentmay contract with Medical Center Eastto provide to that hospital’srehabilitation hospital facility theservices of licensed physical,occupational, or speech therapists, solong as the therapists provided byrespondent do not perform managerialfunctions at the facility, or supervise


personnel except other therapistsprovided by respondent.

C. By no later than the termination ofeach contract identified in ParagraphII.B. above, respondent shall enter intoan agreement with the hospital whoserehabilitation hospital facility wasoperated under such contract (the‘‘managed hospital’’), that:

1. Prohibits respondent from using, inconnection with respondent’s operationof any rehabilitation hospital or otherhealth care facility in the relevantmarket area where the managed hospitalis located, any material confidentialinformation of the managed hospital’srehabilitation hospital facility; and

2. Confers upon the managed hospitala legal right to enforce the prohibitionset forth above in Paragraph II.C.1.

D. Respondent shall comply with allterms of the Agreement to HoldSeparate, attached hereto and made apart hereof as Appendix I. SaidAgreement to Hold Separate shallcontinue in effect until such time asrespondent has fulfilled the divestiturerequirements of this order or until suchother time as the Agreement to HoldSeparate provides.

E. Pending the divestiture required byParagraph II.A. above, and the contractterminations required by Paragraph II.B.above, respondent shall take suchactions as are necessary to maintain theviability, competitiveness, andmarketability of the assets to be divestedand of the rehabilitation hospitalfacilities operated under the contracts tobe terminated, and to prevent thedestruction, removal, wasting,deterioration, or impairment of any ofthe those assets, except for ordinarywear and tear.

F. A condition of approval by theCommission of the divestiture requiredby Paragraph II.A. shall be a writtenagreement by the acquirer that it willnot, for a period of ten (10) years fromthe date of divestiture, directly orindirectly, through subsidiaries,partnerships, or otherwise, without theprior approval of the Commission, sellor otherwise transfer all or substantiallyall of the rehabilitation hospital facilityof Nashville Rehabilitation Hospital toany person who operates, or willoperate immediately following such saleor transfer, any other rehabilitationhospital facility in the Nashvillemetropolitan area as defined inParagraph I.G.3. above.

IIIIt is further ordered that:A. If the respondent has not divested,

absolutely and in good faith and withthe Commission’s prior approval, theassets to be divested identified in

Paragraph II.A. above, in accordancewith this order, within twelve (12)months of the date this order becomesfinal, the Commission may appoint atrustee to divest such assets. In theevent that the Commission or theAttorney General brings an action forany failure to comply with this order orin any way relating to the Acquisition,pursuant to 5(l) of the Federal TradeCommission Act, 15 U.S.C. 45(l), or anyother statute enforced by theCommission, the respondent shallconsent to the appointment of a trusteein such action. Neither the appointmentof a trustee nor a decision not to appointa trustee under this paragraph shallpreclude the Commission or theAttorney General from seeking civilpenalties or any other relief available toit, including a court appointment of atrustee pursuant to Section 5(l) of theFederal Trade Commission Act, 15U.S.C. 45(l), or any other statuteenforced by the Commission, for anyfailure by the respondent to complywith this order.

B. If a trustee is appointed by theCommission or a court pursuant toParagraph III.A. of this order,respondent shall consent to thefollowing terms and conditionsregarding the trustee’s powers, duties,authority, and responsibilities:

1. The Commission shall select thetrustee, subject to the consent of therespondent, which consent shall not beunreasonably withheld. The trusteeshall be a person with experience andexpertise in acquisitions anddivestitures. If respondent has notopposed, in writing, including thereasons for opposing, the selection ofany proposed trustee within ten (10)days after notice by the staff of theCommission to respondent of theidentity of any proposed trustee,respondent shall be deemed to haveconsented to the selection of theproposed trustee.

2. Subject to the prior approval of theCommission, the trustee shall have theexclusive power and authority to divestthe assets identified in Paragraph II.A.above.

3. Within ten (10) days afterappointment of the trustee, respondentshall execute a trust agreement that,subject to the prior approval of theCommission and, in the case of a court-appointed trustee, of the court, transfersto the trustee all rights and powersnecessary to permit the trustee to effectthe divestitures required by this order.

4. The trustee shall have twelve (12)months from the date the Commissionapproves the trust agreement describedin Paragraph III.B.3. to accomplish thedivestiture, which shall be subject to the

prior approval of the Commission. If,however, at the end of the twelve-monthperiod, the trustee has submitted a planof divestiture or believes that divestiturecan be achieved within a reasonabletime, the divestiture period may beextended by the Commission, or in thecase of a court-appointed trustee, by thecourt; provided however, theCommission may extend this periodonly two (2) times.

5. The trustee shall have full andcomplete access to the personnel, books,records, and facilities related to theassets identified in Paragraph II.A.above, or to any other relevantinformation as the trustee may request.Respondent shall develop such financialor other information as such trustee mayreasonably request and shall cooperatewith the trustee. Respondent shall takeno action to interfere with or impede thetrustee’s accomplishment of thedivestiture. Any delays in divestiturecaused by respondent shall extend thetime for divestiture under thisParagraph in an amount equal to thedelay, as determined by the Commissionor, for a court-appointed trustee, by thecourt.

6. The trustee shall use his or her bestefforts to negotiate the most favorableprice and terms available in eachcontract that is submitted to theCommission, subject to the respondent’sabsolute and unconditional obligation todivest at no minimum price. Thedivestiture shall be in the manner andto acquirer(s) as set out in Paragraph IIof this order; provided, however, if thetrustee receives bona fide offers frommore than one acquiring entity, and ifthe Commission determines to approvemore than one such acquiring entity, thetrustee shall divest to the acquiringentity selected by respondent fromamong those approved by theCommission.

7. The trustee shall serve, withoutbond or other security, at the cost andexpense of the respondent, on suchreasonable and customary terms andconditions as the Commission or a courtmay set. The trustee shall have theauthority to employ, at the cost andexpense of respondent, suchconsultants, accountants, attorneys,investment bankers, business brokers,appraisers, and other representativesand assistants as are necessary to carryout the trustee’s duties andresponsibilities. The trustee shallaccount for all monies derived from thesale and all expenses incurred. Afterapproval by the Commission and, in thecase of a court-appointed trustee, by thecourt, of the account of the trustee,including fees for his or her services, allremaining monies shall be paid at the


direction of the respondent and thetrustee’s power shall be terminated. Thetrustee’s compensation shall be based atleast in significant part on a commissionarrangement contingent on the trustee’sdivesting the assets set forth inParagraph II.A. above.

8. Respondent shall identify thetrustee and hold the trustee harmlessagainst any losses, claims, damages,liabilities, or expenses arising out of, orin connection with, the performance ofthe trustee’s duties, including allreasonable fees of counsel and otherexpenses incurred in connection withthe preparation for, or defense of anyclaim, whether or not resulting in anyliability, except to the extent that suchliabilities, losses, damages, claims, orexpenses result from misfeasance, grossnegligence, willful or wanton acts, orbad faith by the trustee.

9. If the trustee ceases to act or failsto act diligently, a substitute trusteeshall be appointed in the same manneras provided in Paragraph III.A. of thisorder.

10. The Commission or, in the case ofa court-appointed trustee, the court,may on its own initiative, or at therequest of the trustee, issue suchadditional orders or directions as theymay be necessary or appropriate toaccomplish the divestiture required bythis order.

11. The trustee shall have noobligation or authority to operate ormaintain the assets identified inParagraph II.A. above.

12. The trustee shall report in writingto the respondent and to theCommission every sixty (60) daysconcerning the trustee’s efforts toaccomplish divestiture.

IVIt is further ordered that, for a period

of ten (10) years from the date this orderbecomes final, respondent shall not,without the prior approval of theCommission, directly or indirectly,through subsidiaries, partnerships, orotherwise:

A. Acquire any stock, share capital,equity, or other interest in any personwho operates any rehabilitation hospitalfacility in any relevant market area;

B. Acquire any assets of anyrehabilitation hospital facility in anyrelevant market area;

C. Enter into any agreement or otherarrangement to obtain direct or indirectownership, management, or control ofany rehabilitation hospital facility orany part thereof in any relevant marketarea, including but not limited to, alease of or management contract for anysuch rehabilitation hospital facility, oran agreement to replace a rehabilitation

hospital facility operated by anotherperson with a rehabilitation hospitalfacility to be operated by respondent;

D. Acquire or otherwise obtain theright to designate, directly or indirectly,directors or trustees of anyrehabilitation hospital facility in anyrelevant market area; or

E. Permit any rehabilitation hospitalfacility it operates in any relevantmarket area to be acquired (in whole orin part, by stock acquisition, assetacquisition, lease, management contract,establishment of a replacement facility,right to designate directors or trustees,or otherwise) by any person whooperates, or will operate immediatelyfollowing such acquisition, any otherrehabilitation hospital facility in thatrelevant market area.

Provided, however, that priorapproval shall not be required by thisParagraph IV for:

1. The establishment of a newrehabilitation hospital facility (otherthan as a replacement for arehabilitation hospital facility, notoperated by respondent, in any relevantarea, pursuant to an agreement orunderstanding between respondent andthe person operating the replacedfacility);

2. Any transaction otherwise subjectto this Paragraph IV of this order if thefair market value of (or, in case of apurchase acquisition, the considerationto be paid for) the rehabilitation hospitalfacility or part thereof to be acquireddoes not exceed five hundred thousanddollars ($500,000);

3. Any transaction otherwise subjectto this Paragraph IV of this order if therehabilitation hospital facility inquestion is already operated byrespondent (unless respondent isrequired by Paragraph II of this order tocease operating the facility); or

4. The acquisition of products orservices in the ordinary course ofbusiness.

VIt is further ordered that, for a period

of ten (10) years from the date this orderbecomes final, respondent shall not,directly or indirectly, throughsubsidiaries, partnerships or otherwise,without providing advance writtennotification to the Commission,consummate any joint venture or otherarrangement with any rehabilitationhospital facility in any relevant marketarea not operated by respondent, for thejoint establishment or operation of anynew rehabilitation hospital service,facility, or part thereof in that relevantmarket area. Such advance notificationshall be filed immediately uponrespondent’s issuance of a letter of

intent for, or execution of an agreementto enter into, such a transaction,whichever is earlier.

Said notification required by thisParagraph V of this order shall be givenon the Notification and Report Form setforth in the Appendix to Part 803 ofTitle 16 of the Code of FederalRegulations (as amended), and shall beprepared and transmitted in accordancewith the requirements of that part,except that no filing fee will be requiredfor any such notification, notificationneed not be made to the United StatesDepartment of Justice, and notificationis required only of respondent and notof any other party to the transaction.Respondent is not required to observeany waiting period after making saidnotification required by this ParagraphV.

Respondent shall comply withreasonable requests by the Commissionstaff for additional informationconcerning any transaction subject tothis Paragraph V of this order, Withinfifteen (15) days of receipt of suchrequests.

Provided, however, that notransaction shall be subject to thisParagraph V of this order if:

A. The fair market value of the assetsto be contributed to the joint venture orother arrangement, by rehabilitationhospital facilities not operated byrespondent, does not exceed fivehundred thousand dollars ($500,000);

B. The fair market value of the assetsto be contributed to the joint venture orother arrangement by respondent doesnot exceed five hundred thousanddollars ($500,000);

C. The service, facility, or part thereofto be established or operated in atransactions subject to this order is toengage in no activities other than theprovision of the following services:laundry; data processing; purchasing;materials management; billing andcollection; dietary; industrialengineering; maintenance; printing;security; records management;laboratory testing; personnel education,testing, or training; or health carefinancing (such as through a healthmaintenance organization or preferredprovider organization); or

D. Notification is required to be made,and has been made, pursuant to Section7A of the Clayton Act, 15 U.S.C. § 18a,or prior approval by the Commission isrequired, and has been requested,pursuant to Paragraph IV of this order.

VIIt is further ordered that, for a period

of ten (10) years from the date this orderbecomes final, respondent shall not sellor otherwise transfer to any other person


all or substantially all of anyrehabilitation hospital facility itoperates in any relevant market area(except pursuant to a divestiturerequired by Paragraph II of this order),unless the acquiring person files withthe Commission, prior to the closing ofsuch acquisition, a written agreement tobe bound by the provisions of this orderas applicable to the facility and therelevant market area in which theacquired facility is located, whichagreement respondent shall require as acondition precedent to the acquisition.

VIIIt is further ordered that:A. Within sixty (60) days after the

date this order becomes final and everysixty (60) days thereafter until therespondent has fully complied withParagraphs II and III of this order, therespondent shall submit to theCommission a verified written reportsetting forth in detail the manner andform in which it intends to comply, iscomplying, and has complied withParagraphs II and III of this order.Respondent shall include in itscompliance reports, among other thingsthat are required from time to tome, afull description of the efforts beingmade to comply with Paragraphs II andIII of the order, including a descriptionof all substantive contracts ornegotiations for the divestiture of theassets identified in Paragraph II.A.above, the steps taken to terminate thecontracts identified in Paragraph II.B.above, and the identity of all partiescontacted. Respondent shall alsoinclude in its compliance reports,subject to any legally recognizedprivilege, copies of all writtencommunications to and from suchparties, all internal memoranda, and allreports and recommendationsconcerning divestiture.

B. One (1) year from the date thisorder becomes final, annually for thenext nine (9) years on the anniversary ofthe date this order becomes final, and atother times as the Commission mayrequire, respondent shall file a verifiedwritten report with the Commissionsetting forth in detail the manner andform in which it has complied and it iscomplying with Paragraphs IV, V, andVI of this order.

VIIIIt is further ordered that respondent

shall notify the Commission at leastthirty (30) days prior to any proposedchange in the corporate respondent suchas dissolution, assignment, saleresulting in the emergence of asuccessor corporation, or the creation ordissolution of subsidiaries or any other

change in the corporation that mayaffect compliance obligations arising outof the order.

IXIt is further ordered that, for the

purpose of determining or securingcompliance with this order, and subjectto any legally recognized privilege, therespondent shall permit any dulyauthorized representative of theCommission:

A. Access, during office hours and inthe presence of counsel, to inspect andcopy all books, ledgers, accounts,correspondence, memoranda, and otherrecords and documents in thepossession or under the control of therespondent relating to any matterscontained in this order; and

B. Upon five days; notice torespondent and without restraint orinterference from it, to interviewofficers, directors, or employees ofrespondent.

In the matter of HEALTHREHABILITATION CORPORATION, acorporation File No. 951–0007.

Agreement to Hold SeparateThis agreement to Hold Separate

(‘‘Agreement’’) is by and betweenHEALTHSOUTH RehabilitationCorporation (‘‘respondent’’ or‘‘HEALTHSOUTH’’), a corporationorganized, existing, and doing businessunder and by virtue of the laws of theState of Delaware, with its principalplace of business at Two Perimeter ParkSouth, Birmingham, Alabama 35243;and the Federal Trade Commission(‘‘Commission’’), and independentagency of the United StatesGovernment, established under theFederal Trade Commission Act of 1914,15 U.S.C. 41, et seq.

Whereas, on or before September 18,1994, HEALTHSOUTH agreed to mergewith ReLife, Inc. (‘‘Relife’’), and therebyacquire, inter alia, a majoritypartnership interest in NashvilleRehabilitation Hospital in Nashville,Tennessee (the ‘‘Acquisition’’); and

Whereas, The Commission is nowinvestigating the Acquisition todetermine if it would violate any of thestatus enforced by the Commission; and

Whereas, if the Commission acceptsthe Agreement Containing ConsentOrder in this matter (‘‘Consent Order’’),which would require the divestiture ofReLife’s majority partnership interest in,and certain other assets listed inParagraph II.A. of the Consent OrderRelating to, Nashville RehabilitationHospital (which assets, together withthe Hospital, hereinafter are referred toas the ‘‘NRH Assets’’), the Commissionmust place the Consent Order on the

public record for a period of at leastsixty (60) days and may subsequentlywithdraw such acceptance pursuant tothe provisions of Section 2.34 of theCommission’s Rules; and

Whereas, the Commission isconcerned that if an understanding isnot reached, preserving the status quoante of the NRH Assets during theperiod prior to the final acceptance andissuance of the Consent Order by theCommission (after the 60-day publiccomment period), divestiture resultingfrom any proceeding challenging thelegality of the Acquisition might not bepossible, or might be less than aneffective remedy; and

Whereas, the Commission isconcerned that if the Acquisition isconsummated, it will be necessary topreserve the Commission’s ability tocompel the divestiture required byParagraphs II.A. and III of the ConsentOrder and the Commission’s right tohave NRH Assets continue as a viableindependent rehabilitation hospitalfacility; and

Whereas, the purpose of thisAgreement and the Consent Order is to:

(i) Preserve the NRH Assets as a viableindependent inpatient rehabilitationhospital facility pending the divestiturerequired by Paragraphs II.A. and III ofthe Consent Order, and

(ii) Remedy any anticompetitiveeffects of the Acquisition;

Whereas, respondent’s entering intothis Agreement shall in no way beconstrued as an admission byrespondent that the Acquisition isillegal; and

Whereas, respondent understands thatno act or transaction contemplated bythis Agreement shall be deemedimmune or exempt from the provisionsof the antitrust laws or the FederalTrade Commission Act by reason ofanything contained in this Agreement.

Now, therefore, the parties agree asfollows, upon understanding that theCommission has not yet determinedwhether the Acquisition will bechallenged, and in consideration of theCommission’s agreement that, unlessthe Commission determines to reject theConsent Order, it will not seek furtherrelief from respondent with respect tothe Acquisition, except that theCommission may exercise any and allrights to enforce this Agreement and theConsent Order to which it is annexedand made a part thereof, and in theevent the required divestiture is notaccomplished, to appoint a trustee toseek divestiture of the NRH Assetspursuant to the Consent Order:

1. Respondent agrees to execute theAgreement Containing Consent Order


and be bound by the attached ConsentOrder.

2. Respondent agrees that from thedate this Agreement is accepted untilthe earliest of the times listed insubparagraphs 2.a or 2.b., it will complywith the provisions of paragraph 3 ofthis Agreement:

a. Three (3) business days after theCommission withdraws its acceptanceof the Consent Order pursuant to theprovisions of Section 2.34 of theCommission’s Rules; or

b. The time that the divestiturerequired by the Consent Order has beencompleted.

3. Respondent will hold the NRHAssets as they are presently constitutedseparate and apart, on the followingterms and conditions:

a. The NRH Assets, as they arepresently constituted, shall be heldseparate and apart and shall be operatedindependently of respondent (meaninghere and hereinafter, HEALTHSOUTHexcluding the NRH Assets), except tothe extent that respondent must exercisedirection and control over the NRHAssets to assure compliance with thisAgreement or the Consent Order andexcept as otherwise provided in thisAgreement.

b. HEALTHSOUTH shall appoint aManagement Committee to manage andmaintain the NRH Assets on a day-to-day basis while this Agreement remainsin effect. The Management Committeeshall have exclusive management andcontrol of the NRH Assets, and shallmanage the NRH Assets independentlyof HEALTHSOUTH’s other businesses.

c. The Management Committee,which shall be appointed byHEALTHSOUTH, shall consist of threeor five members, including a chairmanwho is independent of respondent andis competent to assure to continuedviability and competitiveness of theNRH Assets; a person with experiencein operating rehabilitation hospitalfacilities; and a HEALTHSOUTHcontroller or other financial officer,whose responsibilities do not includeany participation in HEALTHSOUTH’soperations in the Nashville metropolitanarea as defined in Paragraph I.G. of theConsent Order. No more than a minorityof Management Committee membersshall be directors, officers, employees,or agents of respondent (‘‘respondent’sManagement Committee members’’).Meetings of the Management Committeeduring the term of this Agreement shallbe audio recorded, and recordings shallbe retained for two (2) years after thetermination of this Agreeement.

d. Respondent shall not exercisedirection or control over, or influencedirectly or indirectly, the NRH Assets,

any associated operations or businesses,the Management Committee, or theindependent chairman of theManagement Committee; provided,however, that respondent may exerciseonly such direction and control over theManagement Committee as is necessaryto assure compliance with thisAgreement or the Consent Order.

e. Respondent shall maintain theviability, competitiveness, andmarketability of the NRH Assets, andshall not sell, transfer, encumber (otherthan in the normal course of business,or to effect the divestiturescontemplated by the consent order), orotherwise impair their viability,competitiveness, or marketability.

f. The NRH Assets shall be staffedwith employees sufficient in numbersand skills to maintain the viability,competitiveness, and marketability ofthe Hospital and the NRH Assets, whichemployees shall be selected from theexisting employee base of the NRHAssets, and may also be hired fromother sources. To this end, respondentshall maintain at least the same ratios offull-time equivalent employees toinpatient days, for professionalemployee staff (Such as nurses andtherapists), and for other staffemployees, as exist at the date of thisAgreement, and shall offer salaries andemployee benefits sufficient to maintainsuch staffing levels and maintain qualityof patient care at least substantiallyequivalent to that now provided by theemployees of the NRH Assets.

g. With the exception of respondent’sManagement Committee members,respondent shall not change thecomposition of the ManagementCommittee unless the independentchairman consents to such change. Theindependent chairman shall have powerto remove members of the ManagementCommittee for cause. Respondent shallnot change the composition of themanagement of the NRH Assets, exceptthat the Management Committee shallhave the power to remove managementemployees for cause.

h. If the independent chairman ceasesto act or fails to act diligently, asubstitute chairman shall be appointedin the same manner as provided inParagraph 3.c. of this Agreement.

i. Except as required by law, andexcept to the extent that necessaryinformation is exchanged in the courseof evaluating the Acquisition, defendinginvestigations, defending or prosecutinglitigation, negotiating agreements todivest assets, or complying with thisagreement or the Consent Order,respondent shall not receive, haveaccess to, use, or continue to use, anymaterial confidential information (as

that term is defined in the ConsentOrder) not in the public domain aboutthe NRH Assets, or the activities of theManagement Committee. Nor shall theNRH Assets or the ManagementCommittee receive or have access to, oruse or continue to use, any materialconfidential information not in thepublic domain about respondent thatrelates to rehabilitation hospitalfacilities operated by respondent in theNashville metropolitan area as definedin Paragraph I.G. of the Consent Order.Respondent may receive on a regularbasis aggregate financial informationrelating to the NRH Assets necessaryand essential to allow respondent toprepare United States consolidatedfinancial reports, tax returns, andpersonnel reports. Any suchinformation that is obtained pursuant tothis subparagraph shall be used only forthe purpose set forth in thissubparagraph.

j. Except as permitted by thisAgreement, respondent’s ManagementCommittee members shall not, in theircapacity as Management Committeemembers, receive material confidentialinformation of the NRH Assets, andshall not disclose any such informationreceived under this Agreement torespondent, or use it to obtain anyadvantage for respondent. Each ofrespondent’s Management Committeemembers shall enter a confidentialityagreement prohibiting disclosure ofmaterial confidential information.Respondent’s Management Committeemembers shall participate in mattersthat come before the ManagementCommittee only for the limited purposesof considering a capital investment orother transaction exceeding $100,000,approving any proposed budget andoperating plans, and carrying outrespondent’s responsibilities under thisAgreement, the Consent Agreement, andthe Consent Order. Except as permittedby this Agreement, respondent’sManagement Committee members shallnot participate in any matter, or attemptto influence the votes of the othermembers of the Management Committeewith respect to matters, that wouldinvolve a conflict of interest ifrespondent and the NRH Assets wereseparate and independent entities.

k. Any material transaction relating tothe NRH Assets that is out of theordinary course of business must beapproved by a majority vote of theManagement Committee; provided thatthe Management Committee shallapprove no transaction, material orotherwise, that is precluded by thisAgreement.

l. All earnings and profits of the NRHAssets shall be retained separately. If


necessary, respondent shall provide theNRH Assets with sufficient workingcapital to maintain the current rate ofoperation of the NRH Assets, and tocarry out any capital improvement planswhich have been approved.

m. HEALTHSOUTH shall continue toprovide the same support services to theNRH Assets, which are not provided bythat hospital’s employees, as are beingprovided by ReLife to the hospital as ofthe date this Agreement is signed.HEALTHSOUTH may charge the NRHAssets the same fees, if any, charged byReLife for such support services as ofthe date of this Agreement.HEALTHSOUTH personnel providingsuch support services must retain andmaintain all material confidentialinformation of the NRH Assets on aconfidential basis, and, except as ispermitted by this Agreement, suchpersons shall be prohibited fromproviding, discussing, exchanging,circulating, or otherwise furnishing anysuch information to or with any personwhose employment involves any ofrespondent’s businesses, includingwithout limitation businesses in theNashville metropolitan area. Suchpersonnel shall also execute aconfidentiality agreement prohibitingthe disclosure of any materialconfidential information of the NRHAssets.

n. HEALTHSOUTH shall cause theNRH Assets to continue to expend fundsfor marketing and advertising at a levelnot lower than that expended in fiscalyear 1994 or budgeted in fiscal year1995, and shall increase such spendingas deemed reasonably necessary by theManagement Committee in light ofcompetitive conditions.

4. Should the Federal TradeCommission seek in any proceeding tocompel respondent to divest any of theNRH Assets as provided in the ConsentOrder, or to seek any other injunctive orequitable relief for any failure to complywith the Consent Order or thisAgreement, or in any way relating to theAcquisition, respondent shall not raiseany objection based upon the expirationof the applicable Hart-Scott-RodinoAntitrust Improvements Act waitingperiod or the fact that the Commissionhas permitted the Acquisition.Respondent also waives all rights tocontest the validity of this Agreement.

5. To the extent that this Agreementrequires respondent to take, or prohibitsrespondent from taking, certain actionsthat otherwise may be required orprohibited by contract, respondent shallabide by the terms of this Agreement orthe Consent Order and shall not assertas a defense such contract requirementsin a civil penalty action brought by the

Commission to enforce the terms of thisAgreement or Consent Order.

6. For the purpose of determining orsecuring compliance with thisAgreement, subject to any legallyrecognized privilege, and upon writtenrequest with reasonable notice torespondent made to its principal office,respondent shall permit any dulyauthorized representative orrepresentatives of the Commission:

a. Access during the office hours ofrespondent and in the presence ofcounsel to inspect and copy all books,ledgers, accounts, correspondence,memoranda, and other records anddocuments in the possession, or underthe control of respondent, relating tocompliance with this Agreement;

b. Upon five (5) days’ notice torespondent, and without restraint orinterference from respondent, tointerview officers or employees ofrespondent, who may have counselpresent, regarding any such matters.

7. This Agreement shall not bebinding until approved by theCommission.

Analysis of Proposed Consent Order toAid Public Comment HEALTHSOUTHRehabilitation Corp., File No. 951–0007

The Federal Trade Commission hasaccepted, subject to final approval, aproposed consent order fromHEALTHSOUTH RehabilitationCorporation (‘‘HEALTHSOUTH’’). Theagreement would settle charges by theFederal Trade Commission thatHEALTHSOUTH’s proposed mergerwith ReLife Inc. (‘‘ReLife’’) wouldviolate Section 5 of the Federal TradeCommission Act, and Section 7 of theClayton Act.

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 received,and will decide whether it shouldwithdraw from the agreement or issueand serve the agreement’s proposedorder.

HEALTHSOUTH owns and operatesrehabilitation hospital service facilitiesnationwide, including facilities in theBirmingham, Alabama, Charleston,South Carolina, and Nashville,Tennessee metropolitan areas. ReLifeoperates rehabilitation hospital facilitiesin these same areas, among others. Thecomplaint accompanying the proposedconsent order discusses the proposedacquisition’s impact upon competitionfor rehabilitation hospital services in theBirmingham, Charleston, and Nashville

areas. According to the complaint,HEALTHSOUTH operates (i.e., owns,leases, or manages):—a rehabilitation unit within Medical

Center East, a general acute carehospital in Birmingham, Alabama;

—Trident Neurosciences Center, arehabilitation hospital in Charleston,South Carolina; and

—Vanderbilt Stallworth RehabilitationHospital, a rehabilitation hospital inNashville, Tennessee.ReLife operates:

—Lakeshore Hospital, a rehabilitationhospital in Birmingham, Alabama, aswell as rehabilitation hospital unitswithin Bessemer Carraway MedicalCenter, Brookwood Medical Center,and Carraway Methodist MedicalCenter, all general acute care hospitalsin Birmingham, Alabama or adjacentcommunities in Jefferson County,Alabama;

—a rehabilitation hospital unit withinRoper Hospital, a general acute carehospital in Charleston, SouthCarolina; and

—Nashville Rehabilitation Hospital inNashville, Tennessee, a general acutecare hospital in Nashville, Tennesseewhich contains a rehabilitationhospital unit, as well as rehabilitationunit within Sumner MemorialHospital, a general acute care hospitalin Gallatin, Tennessee northeast ofNashville.The consent order, if issued in final

form by the Commission, would settlecharges that the acquisition maysubstantially lessen competition forrehabilitation hospital services in theBirmingham, Charleston, and Nashvilleareas. The complaint alleges thatHEALTHSOUTH and ReLife arecompetitors in those market areas,where, according to the complaint,concentration is already high, and entryby new competitors would be difficult.The complaint alleges that theCommission has reason to believe thatthe acquisition would haveanticompetitive effects in theBirmingham, Charleston, and Nashvillerehabilitation hospital services markets,in violation of Section 5 of the FederalTrade Commission Act and Section 7 ofthe Clayton Act, unless an effectiveremedy eliminates such anticompetitiveeffects.

The order accepted for publiccomment contains provisions requiringthe divestiture by HEALTHSOUTH ofNashville Rehabilitation hospital andrelated assets in Nashville, Tennessee.The order also requires the terminationby HEALTHSOUTH of managementcontracts pertaining to the rehabilitationhospital facilities at Roper Hospital in


Charleston, South Carolina, and MedicalCenter East in Birmingham, Alabama.The purpose of the divestiture andcontract terminations is to ensure thecontinuation of these designatedfacilities as ongoing, viablerehabilitation facilities independent orHEALTHSOUTH, and to remedy thelessening of competition resulting fromthe acquisition in the Birmingham,Charleston, and Nashville areas.

The proposed order requiresHEALTHSOUTH to divest NashvilleRehabilitation Hospital to an acquirer,and in a manner, approved by theCommission. Under the terms of theorder, the required divestiture mut becompleted within twelve months of thedate the order becomes final. If therequired divestiture is not completedwithin the twelve-month period,HEALTHSOUTH will consent to theappointment of a trustee, who wouldhave twelve additional months to effectthe divestiture. The acquirer ofNashville Rehabilitation Hospital wouldbe required to agree that, for ten yearsfrom the date of the order, it will nottransfer Nashville RehabilitationHospital, without the prior approval ofthe Commission, to any person alreadyoperating a rehabilitation hospitalfacility in the Nashville area. Inaddition, the hold separate agreementexecuted in conjunction with theconsent agreement requiresHEALTHSOUTH, until the completionof the divestiture or as otherwisespecified, to maintain NashvilleRehabilitation separate fromHEALTHSOUTH’s other operations.

The provisions of the order relating toRoper Hospital and Medical Center Eastrequire HEALTHSOUTH to terminatethe management contracts for theoperation of those hospitals’rehabilitation units, and cease operationof those rehabilitation facilities, within90 days after the order becomes final(for Medical Center east) or by October1, 1995 (for Roper Hospital).HEALTHSOUTH may, however,continue to supply therapy personnel tothe Medical Center East rehabilitationunit. In addition, HEALTHSOUTHwould be required to enter intoagreements with Roper Hospital andMedical Center East to protect anycompetitively-sensitive informationabout those hospitals whichHEALTHSOUTH has obtained, so thatHEALTHSOUTH rehabilitation facilitieswhich compete with those hospitalswill not be able to use that informationto their competitive advantage.

The order would prohibitHEALTHSOUTH from acquiring anyrehabilitation hospital facilities in theBirmingham, Charleston, and Nashville

areas without the prior approval of theFederal Trade Commission. It wouldalso prohibit HEALTHSOUTH fromtransferring, without prior Commissionapproval, any rehabilitation hospitalfacility it operates in any of those areasto another person operating (or in theprocess of acquiring) anotherrehabilitation hospital facility in thatarea. These provisions, in combination,would give the Commission authority toprohibit any substantial combination ofthe rehabilitation hospital operations ofHEALTHSOUTH with those of anyother rehabilitation hospital facility inthe Birmingham, Charleston, andNashville areas, unless HEALTHSOUTHconvinced the Commission that aparticular transaction would notendanger competition in those areas.The provisions would not apply totransaction where the value of thetransferred assets does not exceed$500,000, or to certain transactionsbetween HEALTHSOUTH and therehabilitation hospital facilities italready operates. They would expire tenyears after the order becomes final.

The order would also requireHEALTHSOUTH to provide advancenotice to the commission beforecarrying out certain joint ventures withcompeting rehabilitation hospitalfacilities in the Birmingham, Charleston,and Nashville areas, for which the orderdoes not otherwise require priorapproval. This requirement is subject tolimitation similar to those applicable tothe prior approval provision, does notrequire notice of certain specifiedsupport services joint ventures, and alsodoes not require additional notice fortransactions which HEALTHSOUTHprovides notice under the premergernotification requirements of the ClaytonAct.

For ten years, the order wouldprohibit HEALTHSOUTH fromtransferring any of its rehabilitationhospital facilities in the Birmingham,Charleston, or Nashville areas to anotherperson without first filing with theCommission an agreement by thetransferee to be bound by the orderprovisions that apply to the facility andthe market area in which it is located.

The purpose of this analysis is toinvite public comment concerning theproposed order, to assist theCommission in its determinationwhether to make the order final. Thisanalysis is not intended to constitute anofficial interpretation of the agreementand order or to modify their terms inany way.

The agreement is for settlementpurposes only and does not constitutean admission by HEALTHSOUTH thatits proposed acquisition would have

violated the law, as alleged in theCommission’s complaint.Donald S. Clark,Secretary.[FR Doc. 95–2059 Filed 1–26–95; 8:45 am]BILLING CODE 6750–01–M

[File No. 951 0005]

Lockheed Corporation, et al.;Proposed Consent Agreement WithAnalysis To Aid Public Comment


SUMMARY: In settlement of allegedviolations of federal law prohibitingunfair acts and practices and unfairmethods of competition, this consentagreement, accepted subject to finalCommission approval, would allow,among other things, the completion ofthe merger between LockheedCorporation and Martin MariettaCorporation, to form Lockheed MartinCorporation, but would prohibit therespondents from enforcing exclusivityprovisions contained in teamingarrangements that each individual firmnow has with infrared sensor producers.The consent agreement also wouldprohibit certain divisions of the mergedfirm from gaining access through otherdivisions to nonpublic information thatthe respondents’ electronics divisionreceives from competing militaryaircraft manufacturers when providing anavigation and targeting system knownas ‘‘LANTIRN’’ to competing aircraftproducers; or that the respondents’satellite divisions receive fromcompeting expendable launch vehiclesuppliers when those competingsuppliers launch the respondents’satellites.DATES: Comments must be received onor before March 28, 1995.ADDRESSES: Comments should bedirected to: FTC/Office of the Secretary,Room 159, 6th Street and PennsylvaniaAvenue, NW., Washington, DC 20580.FOR FURTHER INFORMATION CONTACT:Mary Lou Steptoe, Ann Malester, orLaura Wilkinson, FTC/H–374 or S–2224, Washington, DC 20580 (202) 326–2584, 326–2820 or 326–2830.SUPPLEMENTARY INFORMATION: Pursuantto Section 6(f) of the Federal TradeCommission Act, 38 Stat. 721, 15 U.S.C.46 and Section 2.34 of the Commission’sRules of Practice (16 CFR 2.34), noticeis hereby given that the followingconsent agreement containing a consentorder to cease and desist, having beenfiled with and accepted, subject to finalapproval, by the Commission, has beenplaced on the public record for a period


of sixty (60) days. Public comment isinvited. Such comments or views willbe considered by the Commission andwill be available for inspection andcopying at its principal office inaccordance with Section 4.9(b)(6)(ii) ofthe Commission’s Rules of Practice (16CFR 4.9(b)(6)(ii).

In the Matter of LOCKHEEDCORPORATION, a corporation, MARTINMARIETTA CORPORATION, a corporation,and LOCKHEED MARTIN CORPORATION, acorporation, File No. 951–0005.

Agreement Containing Consent Order

The Federal Trade Commission (‘‘theCommission’’), having initiated aninvestigation of the merger of LockheedCorporation (‘‘Lockheed’’) and MartinMarietta Corporation (‘‘MartinMarietta’’), and it now appearing thatLockheed, Martin Marietta andLockheed Martin Corporation(‘‘Lockheed Martin’’), hereinaftersometimes referred to as proposedrespondents, are willing to enter into anagreement containing an order to refrainfrom certain acts and to provide forother relief:

It is hereby agreed by and betweenproposed respondents, by their dulyauthorized officers and attorneys, andcounsel for the Commission that:

1. Proposed respondent Lockheed is acorporation organized, existing, anddoing business under and by virtue ofthe laws of the State of Delaware, withits office and principal place of businesslocated at 4500 Park Granada Boulevard,Calabasas, California 91399.

2. Proposed respondent MartinMarietta is a corporation organized,existing, and doing business under andby virtue of the laws of the State ofMaryland, with its office and principalplace of business located at 6801Rockledge Drive, Bethesda, Maryland20817.

3. Proposed respondent LockheedMartin is a corporation organized,existing, and doing business under andby virtue of the laws of the State ofMaryland, with its office and principalplace of business located at 6801Rockledge Drive, Bethesda, Maryland20817.

4. Proposed respondents admit all thejurisdictional facts set forth in the draftof complaint.

5. Proposed respondents waive:a. Any further procedural steps;b. The requirement that the


c. All rights to seek judicial review orotherwise to challenge or contest thevalidity of the other entered pursuant tothis agreement; and


6. Proposed respondents shall submitwithin thirty (30) days of the date thisagreement is signed by proposedrespondents an initial report, pursuantto Section 2.33 of the Commission’sRules, signed by the proposedrespondents setting forth in detail themanner in which the proposedrespondents will comply withParagraphs II, III, IV, V, VI, VII and VIIIof the order when and if entered. Suchreport will not become part of the publicrecord unless and until theaccompanying agreement and order areaccepted by the Commission.

7. This agreement shall not become apart of the public record of proceedingunless and until it is accepted by theCommission. If this agreement isaccepted by the Commission it, togetherwith the draft of complaintcontemplated thereby, will be placed onthe public record for a period of sixty(60) days and information in respectthereto publicly released. TheCommission thereafter may eitherwithdraw its acceptance of thisagreement and so notify proposedrespondents, 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.

8. This agreement is for settlementpurposes only and does not constitutean admission by proposed respondentsthat the law has been violated as allegedin the draft complaint, other thanjurisdictional facts, are true.

9. This agreement contemplates that,if it is accepted by the Commission, ifsuch acceptance is not subsequentlywithdrawn by the Commission pursuantto the provisions of Section 2.34 of theCommission’s Rules, the Commissionmay, without further notice to proposedrespondents, (1) issue its complaintcorresponding in form and substancewith the draft of complaint and itsdecision containing the following orderto refrain from certain acts indisposition of the proceeding, and (2)make information public with respectthereto. When so entered, the ordershall have the same force and effect andmay be altered, modified, or set aside inthe same manner and within the sametime provided by statute for otherorders. The order shall become finalupon service. Delivery by the U.S.Postal Service of the complaint anddecision containing the agreed-to orderto proposed respondents’ addresses asstated in this agreement shall constitute

service. Proposed respondents waiveany right they may have to any othermanner of service. The compliant maybe used in construing the terms of theorder, and no agreement, understanding,representation or interpretation notcontained in the order of the agreementmay be used to vary or contradict theterms of the order.

10. Proposed respondents have readthe draft of complaint and ordercontemplated hereby. Proposedrespondents understand that once theorder has been issued, they will berequired to file one or more compliancereports showing that they have fullycomplied with the order. Proposedrespondents further understand thatthey may be liable for civil penalties inthe amount provided by law for eachviolation of the order after it becomesfinal.

Order

I

It is ordered that, as used in thisorder, the following definitions shallapply:

A. ‘‘Lockheed’’ means LockheedCorporation and its predecessors,successors, subsidiaries, divisions,groups and affiliates controlled byLockheed, and their respectivedirectors, officers, employees, agentsand representatives, and their respectivesuccessors and assigns.

B. ‘‘Missile Systems’’ means theMissile Systems Division of LockheedMissiles & Space Company, Inc., anentity with its principal place ofbusiness at 1111 Lockheed Way,Sunnyvale, California 94088, which isengaged in, among other things, theresearch, development, manufactureand sale of Expendable LaunchVehicles, and its subsidiaries, divisions,groups and affiliates controlled byMissiles Systems, and their respectivedirectors, officers, employees, agentsand representatives, and their respectivesuccessors and assigns.

C. ‘‘Commercial Space’’ meansLockheed Commercial Space Company,Inc., an entity with its principal place ofbusiness at 1111 Lockheed Way,Sunnyvale, California 94088, andLockheed-Khrunichev-EnergiaInternational (‘‘LKEI’’), a joint venturebetween Lockheed Commercial SpaceCompany, Inc., Khrunichev Enterpriseand Energia Scientific-Productive Entitywith its principal place of business at2099 Gateway Place, Suite 220, SanJose, California 95110, which areengaged in, among other things, theresearch, development, manufacture,marketing and sale of ExpendableLaunch Vehicles, and its subsidiaries,


divisions, joint venture partners, groupsand affiliates controlled by CommercialSpace, and their respective directors,officers, employees, agents andrepresentatives, and their respectivesuccessors and assigns.

D. ‘‘Space Systems’’ means the SpaceSystems Division of Lockheed Missiles& Space Company, Inc., an entity withits principal place of business at 1111Lockheed Way, Sunnyvale, California94088, which is engaged in, amongother things, the research, development,manufacture and sale of Satellites, andits subsidiaries, divisions, groups andaffiliates controlled by Space Systems,and their respective directors, officers,employees, agents and representatives,and their respective successors andassigns.

E. ‘‘Aeronautical Systems’’ meansLockheed Aeronautical Systems Group,an entity with its principal place ofbusiness at 2859 Paces Ferry, Suite1800, Atlanta, Georgia 30339, which isengaged in, among other things, theresearch, development, manufactureand sale of Military Aircraft, and itssubsidiaries, divisions, groups andaffiliates controlled by AeronauticalSystems, and their respective directors,officers, employees, agents andrepresentatives, and their respectivesuccessors and assigns.

F. ‘‘Martin Marietta’’ means MartinMarietta Corporation and itspredecessors, successors, subsidiaries,divisions, groups and affiliatescontrolled by Martin Marietta, and theirrespective directors, officers, employees,agents and representatives, and theirrespective successors and assigns.

G. ‘‘Astronautics’’ means MartinMarietta’s Astronautics Company, anentity with its principal place ofbusiness at P.O. Box 179, Denver,Colorado 80201, which is engaged in,among other things, the research,development, manufacture and sale ofSatellites and Expendable LaunchVehicles, and its subsidiaries, divisions,groups and affiliates controlled byAstronautics, and their respectivedirectors, officers, employees, agentsand representatives, and their respectivesuccessors and assigns.

H. ‘‘Astro Space’’ means MartinMarietta’s Astro Space Company, anentity with its principal place ofbusiness at P.O. Box 800, Princeton,New Jersey 08543, which is engaged in,among other things, the research,development, manufacture and sale ofSatellites, and its subsidiaries,divisions, groups and affiliatescontrolled by Astro Space, and theirrespective directors, officers, employees,agents and representatives, and theirrespective successors and assigns.

I. ‘‘Electronics and Missiles’’ meansMartin Marietta’s Electronics andMissiles Company, an entity with itsprincipal place of business at 5600 SandLake Road, Orlando, Florida 32819,which is engaged in, among otherthings, the manufacture and sale ofLANTIRN Systems, and its subsidiaries,divisions, groups and affiliatescontrolled by Electronics and Missiles,and their respective directors, officers,employees, agents and representatives,and their respective successors andassigns.

J. ‘‘Lockheed Martin’’ meansLockheed Martin Corporation and itspredecessors, successors, subsidiaries,divisions, groups and affiliatescontrolled by Lockheed Martin, andtheir respective directors, officers,employees, agents and representatives,and their respective successors andassigns.

K. ‘‘Respondents’’ means Lockheed,Martin Marietta and Lockheed Martin.

L. ‘‘Hughes’’ means GM HughesElectronics Corporation, a corporation,organized, existing, and doing businessunder and by virtue of the laws of theState of Delaware, with its office andprincipal place of business located at7200 Hughes Terrace, Los Angeles,California 90045.

M. ‘‘Grumman’’ means NorthropGrumman Corporation, a corporation,organized, existing, and doing businessunder and by virtue of the laws of theState of Delaware, with its office andprincipal place of business located at1840 Century Park East, Los Angeles,California 90067.

N. ‘‘Person’’ means any naturalperson, corporate entity, partnership,association, joint venture, governmententity, trust or other business or legalentity.

O. ‘‘Commission’’ means the FederalTrade Commission.

P. ‘‘Lockheed/Hughes TeamingAgreement’’ means the teamingagreement entered into on January 15,1985, between Lockheed and theElectro-Optical and Data Systems Groupof the Hughes Aircraft Company for thepurpose of submitting a proposal to theUnited States Department of Defense forthe Demonstration/Validation phase ofthe Follow-On Early Warning System,and all subsequent amendments or othermodifications thereto.

Q. ‘‘Martin Marietta/GrummanTeaming Agreement’’ means theteaming agreement entered into on June20, 1994, between Martin Marietta andGrumman for the purpose of bidding onor otherwise competing for the UnitedStates Department of Defense’s Alert,Locate and Report Missiles program,

and all subsequent amendments or othermodifications thereto.

R. ‘‘Space Based Early WarningSystem’’ means any Satellite systemdesigned to be used for tactical warningand attack assessment, theater andstrategic missile defense, and relatedmilitary purposes by the United StatesDepartment of Defense, including butnot limited to the Space Based InfraRed(‘‘SBIR’’) system and successor systemsconsidered by the United StatesDepartment of Defense to follow SBIRprogrammatically.

S. ‘‘Military Aircraft’’ means aircraftmanufactured for sale to the UnitedStates Department of Defense, whetherfor use by the United States Departmentof Defense or for transfer to a foreignmilitary sale purchaser.

T. ‘‘LANTIRN Systems’’ means dualpod, externally mounted, Low-AltitudeNavigation and Targeting Infrared forNight Systems manufactured by MartinMarietta for use on Military Aircraft.

U. ‘‘Expendable Launch Vehicle’’means a vehicle that launches aSatellite(s) from the Earth’s surface thatis consumed during the process oflaunching a Satellite(s) and thereforecannot be launched more than one time.

V. ‘‘Satellite’’ means an unmannedmachine that is launched from theEarth’s surface for the purpose oftransmitting data back to Earth andwhich is designed either to orbit theEarth or travel away from the Earth.

W. ‘‘Non-Public LANTIRNInformation’’ means any information notin the public domain furnished by anyMilitary Aircraft manufacturer toElectronics and Missiles in its capacityas the provider of LANTIRN Systems,and (1) if written information,designated in writing by the MilitaryAircraft manufacturer as proprietaryinformation by an appropriate legend,marking, stamp, or positive writtenidentification on the face thereof, or (2)if oral, visual or other information,identified as proprietary information inwriting by the Military Aircraftmanufacturer prior to the disclosure orwithin thirty (30) days after suchdisclosure. Non-Public LANTIRNInformation shall not include: (i)information already known toRespondents, (ii) information whichsubsequently falls within the publicdomain through no violation of thisorder by Respondents, (iii) informationwhich subsequently becomes known toRespondents from a third party not inbreach of a confidential disclosureagreement, or (iv) information after six(6) years from the date of disclosure ofsuch Non-Public LANTIRN Informationto Respondents, or such other period as


agreed to in writing by Respondents andthe provider of the information.

X. ‘‘Non-Public ELV Information’’means any information not in the publicdomain furnished by an ExpendableLaunch Vehicle manufacturer to SpaceSystems, Astro Space or Astronautics intheir capacities as providers ofSatellites, and (1) if written information,designated in writing by the ExpendableLaunch Vehicle manufacturer asproprietary information by anappropriate legend, marking, stamp, orpositive written identification on theface thereof, or (2) if oral, visual or otherinformation, identified as proprietaryinformation in writing by theExpendable Launch Vehiclemanufacturer prior to the disclosure orwithin thirty (30) days after suchdisclosure. Non-Public ELV Informationshall not include: (i) informationalready known to Respondents, (ii)information which subsequently fallswithin the public domain through noviolation of this order by Respondents,(iii) information which subsequentlybecomes known to Respondents from athird party not in breach of aconfidential disclosure agreement, or(iv) information after six (6) years fromthe date of disclosure of such Non-Public ELV Information to Respondents,or such other period as agreed to inwriting by Respondents and theprovider of the information.

Y. ‘‘Merger’’ means the merger ofMartin Marietta and Lockheed.

IIIt is further ordered that Respondents

shall not enforce or attempt to enforceany provision contained in theLockheed/Hughes Teaming Agreementthat prohibits in any way Hughes from(1) Competing against Lockheed for anypart of any Space Based Early WarningSystem, or (2) teaming or otherwisecontracting with any other person forthe purpose of bidding on, developing,manufacturing, or supplying any part ofany Space Based Early Warning System.Respondents shall not enforce orattempt to enforce any proprietary rightsin the electro-optical sensors developedby Hughes in connection with or byvirtue of the Lockheed/Hughes TeamingAgreement in a manner that wouldinhibit Hughes from competing withRespondents for any part of any SpaceBased Early Warning System.

IIIIt is further ordered that Respondents

shall not enforce or attempt to enforceany provision contained in the MartinMarietta/Grumman Teaming Agreementthat prohibits in any way Grummanfrom (1) Competing against Martin

Marietta for any part of any Space BasedEarly Warning System, or (2) teaming orotherwise contracting with any otherperson for the purpose of bidding on,developing, manufacturing, orsupplying any part of any Space BasedEarly Warning System. Respondentsshall not enforce or attempt to enforceany proprietary rights in the electro-optical sensors developed by Grummanin connection with or by virtue of theMartin Marietta/Grumman TeamingAgreement in a manner that wouldinhibit Grumman from competing withRespondents for any part of any SpaceBased Early Warning System.

IVIt is further ordered that:A. Respondents shall not, absent the

prior written consent of the proprietorof Non-Public LANTIRN Information,provide, disclose, or otherwise makeavailable to Aeronautical Systems anyNon-Public LANTIRN Information; and

B. Respondents shall use any Non-Public LANTIRN Information obtainedby Electronics and Missiles only inElectronics and Missiles’ capacity as theprovider of LANTIRN Systems, absentthe prior written consent of theproprietor of Non-Public LANTIRNInformation.

VIt is further ordered that Respondents

shall deliver a copy of this order to anyUnited States Military Aircraftmanufacturer prior to obtaining anyNon-Public LANTIRN Informationrelating to the manufacturer’s MilitaryAircraft either from the MilitaryAircraft’s manufacturer or through theMerger; provided that for Non-PublicLANTIRN Information described inParagraph I.W.(2) of this order,Respondents shall deliver a copy of thisorder within ten (10) days of the writtenidentification by the Military Aircraftmanufacturer.

VIIt is further ordered that Respondents

shall not make any modifications,upgrades, or other changes to LANTIRNSystems or any component orsubcomponent thereof that discriminateagainst any other Military Aircraftmanufacturer with regard to theperformance of the Military Aircraft orthe time or cost required to integrateLANTIRN Systems into the MilitaryAircraft. Provided, however, thatnothing in this paragraph shall prohibitRespondents from making any suchmodifications, upgrades, or otherchanges that are: (1) necessary to meetcompetition from (a) foreign militaryaircraft, or (b) other products designed

to provide targeting, terrain following,or night navigation functionscomparable in performance to LANTIRNSystems; or (2) approved in writing bythe Secretary of Defense or his or herdesignee.

VII

It is further ordered that:A. Respondents shall not, absent the

prior written consent of the proprietorof Non-Public ELV Information,provide, disclose, or otherwise makeavailable to Astronautics, MissileSystems or Commercial Space any Non-Public ELV Information obtained byAstro Space or Space Systems; and

B. Respondents shall use any Non-Public ELV Information obtained byAstronautics, Astro Space or SpaceSystems only in Astronautics’, AstroSpace’s and Space System’s capacitiesas providers of Satellites, absent theprior written consent of the proprietorof Non-Public ELV Information.

VIII

It is further ordered that Respondentsshall deliver a copy of this order to anyUnited States Expendable LaunchVehicle manufacturer prior to obtainingany Non-Public ELV Informationrelating to the manufacturer’sExpendable Launch Vehicle(s) eitherfrom the Expendable Launch Vehiclemanufacturer or through the Merger;provided that for Non-Public ELVInformation described in ParagraphI.X.(2) of this order, Respondents shalldeliver a copy of this order within ten(10) days of the written identification bythe Expendable Launch Vehiclemanufacturer.

IX

It is further ordered that Respondentsshall comply with all terms of theInterim Agreement, attached to thisorder and made a part hereof asAppendix I. Said Interim Agreementshall continue in effect until theprovisions in Paragraphs II, III, IV, V, VI,VII and VIII are complied with or untilsuch other time as is stated in saidInterim Agreement.

X

It is further ordered that within sixty(60) days of the date this order becomesfinal and annually for the next ten (10)years on the anniversary of the date thisorder becomes final, and at such othertimes as the Commission may require,Respondents shall file a verified writtenreport with the Commission settingforth in detail the manner and form inwhich they have complied and arecomplying with this order. To the extentnot prohibited by United States


Government national securityrequirements, Respondents shallinclude in their reports informationsufficient to identify (a) allmodifications, upgrades, or otherchanges to LANTIRN Systems for whichRespondents have requested and/orreceived written approval from theSecretary of Defense or his or herdesignee pursuant to Paragraph VI ofthis order, (b) all United States MilitaryAircraft manufacturers with whomRespondents have entered into anagreement for the research,development, manufacture or sale ofLANTIRN Systems, and (c) all UnitedStates Expendable Launch Vehiclemanufacturers with whom Respondentshave entered into an agreement for theresearch, development, manufacture orsale of Satellites.

XI

It is further ordered that Respondentsshall notify the Commission at leastthirty days prior to any proposed changein Respondents, such as dissolution,assignment, sale resulting in theemergence of a successor corporation, orthe creation or dissolution ofsubsidiaries or any other change inRespondent that may affect complianceobligations arising out of this order.

XII

It is further ordered that, for thepurpose of determining or securingcompliance with this order, and subjectto any legally recognized privilege andapplicable United States Governmentnational security requirements, uponwritten request, and on reasonablenotice, any Respondent shall permit anyduly authorized representative of theCommission:

A. Access, during office hours and inthe presence of counsel, to inspect andcopy all books, ledgers, accounts,correspondence, memoranda and otherrecords and documents in thepossession or under the control of thatRespondent relating to any matterscontained in this order; and

B. Upon five (5) days’ notice to anyRespondent and without restraint orinterference from it, to interviewofficers, directors, or employees of thatRespondent, who may have counselpresent, regarding such matters.

XIII

It is further ordered that this ordershall terminate twenty (20) years fromthe date this order becomes final.

Appendix I

In the Matter of LOCKHEEDCORPORATION, a corporation, MARTINMARIETTA CORPORATION, a corporation,

and LOCKHEED MARTIN CORPORATION, acorporation, File No. 951–0005.

Interim Agreement

This Interim Agreement is by andbetween Lockheed Corporation(‘‘Lockheed’’), a corporation organizedand existing under the laws of the Stateof Delaware, Martin MariettaCorporation (‘‘Martin Marietta’’), acorporation organized and existingunder the laws of the State of Maryland,Lockheed Martin Corporation(‘‘Lockheed Martin’’), a corporationorganized and existing under the laws ofthe State of Maryland (collectivelyreferred to as ‘‘Proposed Respondents’’),and the Federal Trade Commission (the‘‘Commission’’), an independent agencyof the United States Government,established under the Federal TradeCommission Act of 1914, 15 U.S.C. 41,et seq. (collectively, the ‘‘Parties’’).

Premises

Whereas, Martin Marietta andLockheed have proposed the merger oftheir businesses by the formation of anew corporation, Lockheed Martin; and

Whereas, the Commission is nowinvestigating the proposed Merger todetermine if it would violate any of thestatutes the Commission enforces; and

Whereas, if the Commission acceptsthe Agreement Containing ConsentOrder (‘‘Consent Agreement’’), theCommission will place it on the publicrecord for a period of at least sixty (60)days and subsequently may eitherwithdraw such acceptance or issue andserve its Complaint and decision indisposition of the proceeding pursuantto the provisions of Section 2.34 of theCommission’s Rules; and

Whereas, the Commission isconcerned that if an understanding isnot reached, preserving competitionduring the period prior to the finalacceptance of the Consent Agreement bythe Commission (after the 60-day publicnotice period), there may be interimcompetitive harm and divestiture orother relief resulting from a proceedingchallenging the legality of the proposedMerger might not be possible, or mightbe less than an effective remedy; and

Whereas, Proposed Respondentsentering into this Interim Agreementshall in no way be construed as anadmission by Proposed Respondentsthat the proposed Merger constitutes aviolation of any statute; and

Whereas, Proposed Respondentsunderstand that no act or transactioncontemplated by this Interim Agreementshall be deemed immune or exemptfrom the provisions of the antitrust lawsor the Federal Trade Commission by

reason of anything contained in thisInterim Agreement.

Now, therefore, the Parties agree,upon the understanding that theCommission has not yet determinedwhether the proposed Merger will bechallenged, and in consideration of theCommission’s agreement that, unlessthe Commission determines to reject theConsent Agreement, it will not seekfurther relief from ProposedRespondents with respect to theproposed Merger, except that theCommission may exercise any and allrights to enforce this Interim Agreement,the Consent Agreement, and the finalorder in this matter, and, in the eventthat Proposed Respondents do notcomply with the terms of this InterimAgreement, to seek further reliefpursuant to Section 5 of the FederalTrade Commission Act, 15 U.S.C. § 45,and Section 7 of the Clayton Act, 15U.S.C. § 18, as follows:

1. Proposed Respondents agree toexecute and be bound by the terms ofthe Other contained in the ConsentAgreement, as if it were final, from thedate the Consent Agreement is acceptedfor public comment by the Commission.

2. Proposed Respondents agree todeliver within three (3) days of the datethe Consent Agreement is accepted forpublic comment by the Commission, acopy if the Consent Agreement and acopy of this Interim Agreement to theUnited States Department of Defense,GM Hughes Electronics Corporation,Loral Corporation, Northorp GrummanCorporation, Rockwell InternationalCorporation and TRW Incorporated.

3. Proposed Respondents agree tosubmit within thirty (30) days of thedate the Consent Agreement is signed bythe Proposed Respondents, an initialreport, pursuant to Section 2.33 of theCommission’s Rules, signed by theProposed Respondents setting forth indetail the manner in which theProposed Respondents will comply withParagraphs II, III, IV, V, VI, VII and VIIIof the Consent Agreement.

4, Proposed Respondents agree that,from the date the Consent Agreement isaccepted for public comment by theCommission until the first of the dateslisted in subparagraphs 4.a and 4.b, theywill comply with the provisions of thisInterim Agreement:

a. Ten business days after theCommission withdraws its acceptanceof the Consent Agreement pursuant tothe provisions of Section 2.34 of theCommission’s rules;

b. The date the Commission finallyaccepts the Consent Agreement andissues its Decision and Order.


5. Proposed Respondents waive allrights to contest the validity of thisInterim Agreement.

6. For the purpose of determining orsecuring compliance with this InterimAgreement, subject to any legallyrecognized privilege and applicableUnited States Government nationalsecurity requirements, and upon writtenrequest, and on reasonable notice, toany Proposed Respondent made to itsprincipal office, that ProposedRespondent shall permit any dulyauthorized representative orrepresentatives of the Commission:

a. Access during the office hours ofthat Proposed Respondent and in thepresence of counsel to inspect and copyall books, ledgers, accounts,correspondence, memoranda, and otherrecords and documents in thepossession or under the control of thatProposed Respondent relating tocompliance with this InterimAgreement; and

b. Upon five (5) days’ notice to anyProposed Respondent and withoutrestraint or interference from it, tointerview officers, directors, oremployees of that Proposed Respondent,who may have counsel present,regarding any such matters.

7. This Interim Agreement shall notbe binding until accepted by theCommission.

Analysis of Proposed Consent Order ToAid Public Comment

The Federal Trade Commission(‘‘Commission’’) has accepted, subject tofinal approval, an agreement containinga proposed Consent Order fromLockheed Corporation (‘‘Lockheed’’),Martin Marietta Corporation (‘‘MartinMarietta’’) and Lockheed MartinCorporation (‘‘Lockheed Martin’’),collectively referred to as respondents.The proposed Consent Order prohibitsrespondents from enforcing exclusivityprovisions contained in teamingagreements with manufacturers ofsensors for space-based early warningsystems. The proposed Consent Orderalso prohibits respondents’ militaryaircraft division from gaining access toany non-public information thatrespondents’ electronics divisionreceives from competing militaryaircraft manufacturers when providing anavigation and targeting system knownas ‘‘LANTIRN’’ to competing aircraftproducers. In addition, the proposedConsent Order prohibits respondentsfrom making any modifications to theLANTIRN system that discriminateagainst other military aircraftmanufacturers unless suchmodifications either are necessary tomeet competition or are approved by the

Secretary of Defense. Finally, theproposed Consent Order prohibitsrespondents’ expendable launch vehicle(‘‘ELV’’) divisions from gaining access toany non-public information thatrespondents’ satellite divisions receivefrom competing ELV suppliers whenthose competing suppliers launchrespondents’ satellites.

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.

Pursuant to an August 29, 1994,Agreement and Plan of Reorganization,Lockheed and Martin Marietta agreed tomerge their businesses into a newlycreated corporation, Lockheed Martin.The proposed complaint alleges that themerger, if consummated, would violateSection 5 of the Federal TradeCommission Act, as amended, 15 U.S.C.45, and Section 7 of the Clayton Act, asamended, 15 U.S.C. 18, in the followingthree markets in the United States:

(1) the research, development,manufacture and sale of satellites foruse in space-based early warningsystems;

(2) the research, development,manufacture and sale of militaryaircraft; and

(3) the research, development,manufacture and sale of expendablelaunch vehicles.

The proposed Consent Order wouldremedy the alleged violations. First, inthe market for space-based earlywarning systems, Lockheed and MartinMarietta are exclusively teamed withthe Electro-Optical and Data SystemsGroup of Hughes Aircraft Company(‘‘Hughes’’) and Northrop GrummanCorporation (‘‘Northrop Grumman’’),respectively. Hughes and NorthropGrumman are two of the leadingmanufacturers of sensors for space-based early warning systems. Becausethe Lockheed/Hughes and MartinMarietta/Northrop Grumman teamingagreements are both exclusive, theproposed merger would allow LockheedMartin to tie up two different sensors forspace-based early warning systems. Theproposed Consent Order makes theseagreements non-exclusive, which allowsHughes and Northrop Grumman to bidfor space-based early warning systemseither on their own or teamed withother companies, as well as to continueworking with their current teammates,Lockheed and Martin Marietta. The

purpose of the proposed Consent Orderis to increase the number of competitorsfor space-based early warning systemsprocured by the United StatesDepartment of Defense (‘‘DoD’’).

Second, Lockheed is a significantcompetitor in the manufacture and saleof military aircraft, and Martin Mariettais the only supplier of the LANTIRNinfrared navigation and targetingsystem, a critical component on somemilitary aircraft. Following the merger,Lockheed Martin would be the solesource for LANTIRN systems, as well asa competitor in the military aircraftmarket. Because military aircraftmanufacturers will have to provideproprietary information to the LockheedMartin division that manufacturersLANTIRN, Lockheed Martin’s militaryaircraft division could gain access tocompetitively significant and non-public information concerningcompeting military aircraft. In addition,because the LANTIRN system isperiodically modified or upgraded,Lockheed Martin could modify theLANTIRN in a manner thatdiscriminates against competingmilitary aircraft manufacturers. As aresult, the proposed merger increasesthe likelihood that competition betweenmilitary aircraft suppliers woulddecrease because Lockheed Martinwould have access to its competitors’proprietary information, which couldaffect the prices and services thatLockheed Martin provides. In addition,advancements in military aircraftresearch, innovation, and quality wouldbe reduced because Lockheed Martin’smilitary aircraft competitors would fearthat Lockheed Martin could ‘‘free ride’’off of its competitors’ technologicaldevelopments.

Therefore, the proposed ConsentOrder prohibits Lockheed Martin fromdisclosing any non-public informationthat it received from military aircraftmanufacturers in its capacity as aprovider of the LANTIRN system toLockheed Martin’s military aircraftdivision. Under the proposed Order,Lockheed Martin may only use suchinformation in its capacity as a providerof the LANTIRN system. Non-publicinformation in this context means anyinformation not in the public domainand designated as proprietaryinformation by any military aircraftmanufacturer that provides suchinformation to Lockheed Martin. Theproposed Consent Order also prohibitsLockheed Martin from making anymodifications to the LANTIRN systemthat disadvantage other military aircraftmanufacturers unless the modificationare necessary to meet competition or areapproved by the Secretary of Defense, or


his or her designee. The purpose of theproposed Order is to maintain theopportunity for full competition in themarket for the research, development,manufacture and sale of militaryaircraft.

Third, Martin Marietta and Lockheedare significant competitors in themanufacture and sale of satellites andexpendable launch vehicles. Theproposed merger increases the degree ofvertical integration in the markets forsatellites and ELVs used by the UnitedStates government. Because satellitesmanufactured by Lockheed Martin maybe launched on ELVs supplied byLockheed Martin’s competitors,Lockheed Martin’s satellite divisionscould gain access to competitivelysignificant and non-public informationconcerning competitors’ ELVs duringthe process of integrating a satellite andan ELV. As a result, the proposedmerger increases the likelihood thatcompetition between ELV supplierswould decrease because LockheedMartin would have access to itscompetitor’s proprietary information,which could affect the prices andservices that Lockheed Martin provides.In addition, advancements in ELVresearch, innovation, and quality wouldbe reduced because Lockheed Martin’sELV competitors would fear thatLockheed Martin could ‘‘free ride’’ off ofits competitors’ technologicaldevelopments.

The proposed Consent Orderprohibits Lockheed Martin’s satellitedivisions from disclosing to LockheedMartin’s ELV divisions any non-publicinformation that Lockheed Martinreceives from competing suppliers ofELVs. Under the proposed Order,Lockheed Martin may only use suchinformation in its capacity as a satellitemanufacturer. Non-public informationin this context means any informationnot in the public domain and designatedas proprietary information by any ELVmanufacturer that provides suchinformation to Lockheed Martin’ssatellite divisions. The purpose of theproposed Order is to maintain theopportunity for full competition in theresearch, development, manufactureand sale of ELVs.

Under the provisions of the proposedConsent Order, respondents are requiredto deliver a copy of the Order to anyUnited States military aircraftmanufacturer and to any United StatesELV manufacturer prior to obtaining anyinformation from them that is outsidethe public domain. Under the proposedOrder, respondents also are required toprovide to the Commission reports oftheir compliance with the Order sixty(60) days after the Order becomes final

and annually for the next ten (10) yearson the anniversary of the date the Orderbecomes final.

In order to preserve or promotecompetition in the relevant marketsduring the period prior to the finalacceptance of the proposed ConsentOrder (after the 60-day public noticeperiod), respondents have entered intoan Interim Agreement with theCommission in which respondentsagreed to be bound by the proposedConsent Order as of January 10, 1995,the date the Commission accepted theproposed Consent Order subject to finalapproval.

The purpose of this analysis is tofacilitate public comment on theproposed Order, and it is not intendedto constitute an official interpretation ofthe agreement and proposed Order or tomodify in any way their terms.Donald S. Clark,Secretary.[FR Doc. 95–2060 Filed 1–26–95; 8:45 am]BILLING CODE 6750–01-M

[File No. 941–0043]

Montedison S.p.A., et al.; ProposedConsent Agreement With Analysis ToAid Public Comment


SUMMARY: In settlement of allegedviolations of federal law prohibitingunfair acts and practices and unfairmethods of competition, this consentagreement, accepted subject to finalCommission approval, would require,among other things, the Royal DutchPetroleum Company and the ShellGroup of Companies to divest all ofShell Oil’s polypropylene assets toUnion Carbide Corporation, or toanother Commission approved acquirer,within six months; would requireMontedison to relinquish revenuesunder the profit sharing agreement fromfuture U.S. licenses by MitsuiPetrochemical Industries Ltd.; andwould prohibit the company fromentering into similar agreements.DATES: Comments must be received onor before March 28, 1995.ADDRESSES: Comments should bedirected to: FTC/Office of the Secretary,Room 159, 6th Street and PennsylvaniaAvenue NW., Washington, D.C. 20580.FOR FURTHER INFORMATION CONTACT:Howard Morse or Rhett Krulla, FTC/S–3627, Washington, D.C. 20580. (202)326–6320 or 326–2608.SUPPLEMENTARY INFORMATION: Pursuantto Section 6(f) of the Federal TradeCommission Act, 38 Stat. 721, 15 U.S.C.

46 and Section 2.34 of the Commission’sRules of Practice (16 CFR 2.34), noticeis hereby given that the followingconsent agreement containing a consentorder to cease and desist, having beenfiled with and accepted, subject to finalapproval, by the Commission, has beenplaced on the public record for a periodof sixty (60) days. Public comment isinvited. Such comments or views willbe considered by the Commission andwill be available for inspection andcopying at its principal office inaccordance with Section 4.9(b)(6)(ii) ofthe Commission’s Rules of Practice (16CFR 4.9(b)(6)(ii).

In the matter of Montedison S.p.A., acorporation, HIMONT Incorporated, acorporation, Royal Dutch PetroleumCompany, a corporation, The ‘‘Shell’’Transport and Trading Company, p.l.c., acorporation, and Shell Oil Company, acorporation, File No. 941–0043.

Agreement Containing Consent OrderThe Federal Trade Commission (‘‘the

Commission’’), having initiated aninvestigation of the proposed formationof a joint venture between MontedisonS.p.A. and HIMONT Incorporated(collectively ‘‘Montedison’’) and ShellPetroleum N.V., a holding company ofthe Royal Dutch/Shell Group ofCompanies (‘‘the Shell Group’’)controlled by N.V. KoninklijkeNederlandsche Petroleum Maatschappij(Royal Dutch Petroleum Company)(‘‘Royal Dutch’’) and The ‘‘Shell’’Transport and Trading Company, p.l.c.(‘‘Shell T&T’’), that would merge certainassets and businesses of Montedisonand of companies of the Shell Groupand it now appearing that Royal Dutch,Shell T&T, and Shell Oil Company(‘‘Shell Oil’’), a company of the ShellGroup, (collectively ‘‘Shell’’) andMontedison, all collectively hereinaftersometimes referred to as ‘‘proposedrespondents,’’ are willing to enter intoan agreement containing an order toexclude certain assets and businessesfrom the joint venture, to divest certainassets and businesses, and to cease anddesist from making certain acquisitions,and providing for other relief:

It is hereby agreed by and betweenproposed respondents, by their dulyauthorized officers and attorneys, andcounsel for the Commission that:

1. Proposed respondent MontedisonS.p.A. is a corporation organized,existing and doing business under andby virtue of the laws of Italy with itsprincipal executive offices located atForo Buonaparte, 31, 20121 Milan, Italy.

2. Proposed respondent HIMONTIncorporated is a corporation organized,existing and doing business under andby virtue of the laws of the State of


Delaware with its principal executiveoffices located at Three Little FallsCentre, 2801 Centerville Road,Wilmington, Delaware 19850–5439.HIMONT Incorporated is a wholly-owned, indirect subsidiary ofMontedison S.p.A.

3. Proposed respondent Royal Dutchis a corporation organized, existing anddoing business under and by virtue ofthe laws of the Netherlands with itsprincipal executive offices located atCarel van Bylandtlaan 30, The Hague,The Netherlands. Royal Dutch is aholding company which, together withShell T&T, controls the Shell Group.

4. Proposed respondent Shell T&T isa corporation organized, existing anddoing business under and by virtue ofthe laws of England with its principalexecutive offices located at Shell Centre,London SE1 7NA, England. Shell T&T isa holding company which, together withRoyal Dutch, controls the Shell Group.

5. Proposed respondent Shell Oil is acorporation organized, existing anddoing business under and by virtue ofthe laws of Delaware with its principalexecutive offices located at One ShellPlaza, Houston, Texas 77002. Shell Oilis a member company of the ShellGroup, and all of its shares are directlyor indirectly owned by Royal Dutch andShell T&T.

6. Proposed respondents admit, forpurposes of this Agreement and Orderand any related enforcement action, allthe jurisdictional facts set forth in thedraft of complaint.

7. Proposed respondents waive:(a) any further procedural steps;(b) the requirement that the

Commission’s decision contains astatement of findings of fact andconclusions of law;

(c) all rights to seek judicial review orotherwise to challenge or contest thevalidity of the Order entered pursuant tothis Agreement; and

(d) any claim under the Equal Accessto Justice Act.

8. 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 draft ofcomplaint contemplated thereby, will beplaced on the public record for a periodof sixty (60) days and information inrespect thereto released. TheCommission thereafter may eitherwithdraw its acceptance of thisAgreement and so notify the proposedrespondents, in which event it will takesuch action as it may considerappropriate, or issue and serve itscomplaint (in such forms as thecircumstances may require) and

decision, in disposition of theproceeding.

9. This Agreement is for settlementpurposes only and does not constitutean admission by proposed respondentsthat the law has been violated as allegedin the draft of complaint, or that thefacts as alleged in the draft of complaint,other than jurisdictional facts admittedas specified above, are true.

10. This Agreement contemplatesthat, if it is accepted by theCommission, and if such acceptance isnot subsequently withdrawn by theCommission pursuant to the provisionsof Section 2.34 of the Commission’sRules, the Commission may, withoutfurther notice to the proposedrespondents, (1) issue its complaintcorresponding in form and substancewith the draft of complaint and itsdecision containing the following Orderto divest and to cease and desist indisposition of the proceeding, and (2)make information public with respectthereto. When so entered, the Ordershall have the same force and effect andmay be altered, modified, or set aside inthe same manner and within the sametime provided by statute for otherorders. The Order shall become finalupon service. Delivery by the U.S.Postal Service of the complaint anddecision containing the agreed-to Orderto proposed respondents’ attorneys ofrecord, William C. Pelster, Esq.,Skadden, Arps, Slate, Meagher & Flom,919 Third Avenue, New York, NY10022, for Montedison; Robert D. Joffe,Esq., Cravath, Swaine & Moore, 825Eighth Avenue, New York, NY 10019,for Royal Dutch and Shell T&T; and S.Allen Lackey, Esq., Shell Oil Company,One Shell Plaza, Houston, Texas 77252,for Shell Oil, shall constitute service.Proposed respondents waive any rightthey 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 thisAgreement may be used to vary orcontradict the terms of the Order.

11. Proposed respondents have readthe proposed complaint and Ordercontemplated hereby. Proposedrespondents understand that once theOrder has been issued, they will berequired to file one or more compliancereports showing they have fullycomplied with the Order. Proposedrespondents further understand thatthey may be liable for civil penalties inthe amount provided by law for eachviolation of the Order after it becomesfinal.

Order

IIt is ordered that, as used in this

Order, the following definitions shallapply:

A. The following terms shall mean thefollowing entities:

1. ‘‘Montedison’’ means MontedisonS.p.A. and its wholly owned subsidiaryMontedison (Nederland) N.V., a holdingcompany that owns MontecatiniNederland B.V., which in turn owns,directly or indirectly, through itssubsidiaries HIMONT Incorporated,Spherilene S.r.l., Moplefan S.p.A. andMontepolmieri Sud, S.p.A., all of thepolyolefins interests of MontedisonS.p.A. ‘‘Montedison’’ includes allsubsidiaries, divisions, and groups andaffiliates controlled by MontedisonS.p.A., their respective successors andassigns, and their respective directors,officers, employees, agents andrepresentatives. Unless otherwiseindicated, ‘‘Montedison’’ does notinclude Montell.

2. ‘‘HIMONT’’ means HIMONTIncorporated. ‘‘HIMON’’ includes allsubsidiaries, divisions, and groups andaffiliates controlled by HIMONT, theirrespective successors and assigns, andtheir respective directors, officers,employees, agents and representatives.

3. ‘‘Shell’’ means N.V. KoninklijkeNederlandsche Petroleum Maatschappij(Royal Dutch Petroleum Company)(‘‘Royal Dutch’’), The ‘‘Shell’’ Transportand Trading Company, p.l.c. (‘‘ShellT&T’’), and the Shell Group.

4. ‘‘The Shell Group’’ means allcompanies controlled by Royal Dutchand/or Shell T&T, including Shell Oiland Shell Petroleum N.V. ‘‘The ShellGroup’’ includes all subsidiaries,divisions, and groups and affiliatescontrolled by companies of the ShellGroup, Royal Dutch or Shell T&T, theirrespective successors and assigns, andtheir respective directors, officers, andagents and representatives. Unlessotherwise indicated, ‘‘the Shell Group’’does not include Montell.

5. ‘‘Shell Oil’’ means Shell OilCompany. ‘‘Shell Oil’’ includes allsubsidiaries, divisions, and groupscontrolled by Shell Oil, their respectivesuccessors and assigns, and theirrespective directors, officers, agents andrepresentatives. Unless otherwiseindicated, ‘‘Shell Oil’’ does not includePolyco.

6. ‘‘Montell’’ means MontellPolyolefins, the corporation to beformed, pursuant to the Agreement toMerge Polyolefins Businesses, to holdthe majority of the polyolefinsbusinesses of Montedison and of Shelland to be owned, directly or indirectly,


by Montedison and companies of theShell Group. ‘‘Montell’’ includes allsubsidiaries, divisions, and groupscontrolled by Montell, their respectivesuccessors and assigns, and theirrespective directors, officers, agents andrepresentatives.

7. ‘‘Montell Affiliates’’ meanscompanies that Montell controls as thatterm is defined in 16 C.F.R. § 801.1(b),except that this term shall also include(i) any entity other than Montell inwhich Shell or Montedison has anownership interest of 25% or more as ofDecember 1, 1994 and which interest iscontributed to Montell, and (ii)companies in which Montell has anownership interest of 35% or more andwould have control as defined in 16CFR 801.1(b) if ownership interests helddirectly or indirectly by a governmentwere excluded.

8. ‘‘Technipol’’ means a company tobe formed and held separate byMontedison under the terms andconditions of the attached Agreement toHold Separate. ‘‘Technipol’’ includes allsubsidiaries, divisions, and groupscontrolled by Technipol, theirrespective successors and assigns, andtheir respective directors, officers,agents and representatives.

9. ‘‘Polyco’’ means a company to beformed by Shell Oil to succeed to andconduct, under the terms andconditions of this Order, the Propertiesto Be Divested. ‘‘Polyco’’ includes allsubsidiaries, divisions, and groupscontrolled by Polyco, their respectivesuccessors and assigns, and theirrespective directors, officers, agents andrepresentatives.

10. ‘‘Akzo Nobel’’ means Akzo NobelN.V., Akzo Nobel Inc., Akzo ChemicalsBV and Akzo Chemicals Inc.

11. ‘‘Mitsui’’ means MitsuiPetrochemical Industries Ltd.

12. ‘‘Union Carbide’’ or ‘‘UCC’’ meansUnion Carbide Corporation.

B. ‘‘Commission’’ means the FederalTrade Commission.

C. ‘‘Agreement to Merge PolyolefinsBusinesses’’ means the agreementbetween Montedison and ShellPetroleum N.V. (a company of the ShellGroup) dated December 30, 1993, andamendments thereto, to merger themajority of the worldwide polyolefinsbusinesses of Montedison and of Shellinto a new entity to be owned byMontedison and companies of the ShellGroup.

D. ‘‘Propylene Polymers’’ or ‘‘PP’’means homopolymers of propylene andcopolymers or polyolefinic alloys ofpropylene with less than 50% by mol ofother monoolefins and having a flexuralmoduls (measured according to ASTMD 790–71) higher than 4,000 Kg/cm2.

E. ‘‘PP Catalyst’’ means supportedcatalyst components includingcompounds of transition metals ofGroups IV–VIII of the Periodic Table, atleast in part supported on a carrier, theessential component of which is ahalogen-containing compound ofmagnesium, for use in production ofPropylene Polymers.

F. ‘‘Catalyst Support’’ meanspreformed catalyst supports or supportcarriers which may be titanated, i.e.,combined with titanium or with atitanium containing compound, toproduce PP Catalyst.

G. ‘‘Catalyst Systems’’ meansspecified combinations of PP Catalystand other components designed,developed, used, or suitable for use forthe production of Propylene Polymers.

H. ‘‘PP Technology’’ meanstechnology relating to PropylenePolymers and the production thereof,and to the preparation and use ofCatalyst Systems.

I. ‘‘Catalyst Technology’’ meanstechnology relating to PP Catalyst and tothe production, preparation and use ofPP Catalyst, Catalyst Support andCatalyst Systems.

J. ‘‘Shell Catalyst Technology’’ meansCatalyst Technology, including Know-How and patent rights, developed,under development, used, offered forlicense or licensed to any person bycompanies of the Shell Group at anytime prior to the date of transfer toPolyco of the Properties to Be Divested.

K. ‘‘Shell Oil Catalyst Technology’’means Catalyst Technology, includingKnow-How and patent rights,developed, under development, used,offered for license or licensed to anyperson by Union Carbide or Shell Oil atany time prior to that date of transfer toPolyco of the Properties to Be Divested.

L. ‘‘Unipol PP Technology’’ means PPTechnology and Catalyst Technology,including Know-How and patent rights,developed, under development, offeredfor license, or licensed to any person byUCC and/or Shell Oil in accordancewith their Cooperative UndertakingAgreement dated December 22, 1983, orused by UCC and Shell Oil in theirpartnership PP facility at Seadrift, Texasat any time prior to the date this Orderbecomes final.

M. ‘‘Unipol/SHAC TechnologyBusiness’’ means the research anddevelopment, promotion, and licensingof Unipol PP Technology and Shell OilCatalyst Technology; the research anddevelopment of PP Catalyst, CatalystSupport and Catalyst Systems utilizingUnipol PP Technology and Shell OilCatalyst Technology; rights andobligations under, and activitiesconducted pursuant to, the Cooperative

Undertaking Agreement between UCCand Shell Oil dated December 22, 1983,and the Polypropylene CatalystResearch and Development Agreementamong Shell Oil, UCC and ShellInternationale Research MaatschappijB.V. (‘‘The Tripartite Catalyst ResearchAgreement’’); and the research anddevelopment, production and sale ofPropylene Polymers, and thedemonstration of Unipol PP Technologyand Shell Oil Catalyst Technology,pursuant to the Seadrift PolypropyleneCompany partnership agreementbetween UCC and Shell Oil.

N. ‘‘LIPP Process’’ means PPTechnology developed and used byShell for the production of PropylenePolymers through a bulk liquidpolymerization process.

O. ‘‘Know-How’’ means all relevantinformation, including knowledge,experience and specifications.

P. ‘‘Material ConfidentialInformation’’ means competitivelysensitive or proprietary information, notin the public domain, concerning the PPTechnology, Catalyst Technology, PPCatalyst, Catalyst Support, or PropylenePolymers businesses.

Q. ‘‘Properties to Be Divested’’ means1. All assets, tangible and intangible,

of Shell Oil relating to PP Technology,Catalyst Technology, PropylenePolymers and PP Catalyst, includingwithout limitation:

a. Shell Oil’s Propylene Polymersplant and assets at Norco, Louisiana,and Shell Oil’s associated facilities atNorco, Louisiana for splitting andseparating polymer-grade propylene andpropane from chemical-gradepropylene;

b. Shell Oil’s PP Catalyst plant andassets at Norco, Louisiana;

c. Shell Oil’s interest in the SeadriftPolypropylene Company and thePropylene Polymers plant at Seadrift,Texas;

d. Shell Oil’s PP Catalyst pilot plant;e. Shell Oil’s facilities and equipment

(other than real property and general,chemical analytical equipment) at theWesthollow Technology Center atHouston, Texas, primarily utilizedduring the year prior to the transfer toPolyco of the Properties to Be Divestedin research, development and technicalsupport with respect to Shell Oil’sPropylene Polymers, PP Catalyst andCatalyst Technology businesses;

f. A rent-free lease, until five yearsfrom the date of divestiture of theProperties to Be Divested or until suchearlier date as the acquirer may elect, tooffices and research and developmentspace at the Westhollow TechnologyCenter at Houston, Texas, associatedwith the Properties to Be Divested;


g. All owned or leased distributionfacilities, rail cars and other assets usedin sales or technical service ofPropylene Polymers or PP Catalyst,other than real property at theheadquarters offices, general salesoffices, and research center of Shell Oil;

h. All intellectual property, includingpatent rights, trade secrets, technologyand Know-How, relating to CatalystTechnology, PP Catalyst, CatalystSystems, and Propylene Polymers;

i. All customer lists, vendor lists,catalogs, sales promotion literature,advertising materials, researchmaterials, technical information,management information systems,software, inventions, specifications,designs, drawings, processes and qualitycontrol data;

j. All interest in and to the contractsentered into in the ordinary course ofbusiness with customers (together withassociated bid and performance bonds),suppliers, sales representatives,distributors, agents, personal propertylessors, personal property lessees,licensors, licensees, consignors andconsignees, including withoutlimitation agreements with ShellCanada and Pecten, and rights underwarranties and guarantees, express orimplied;

k. All books, records, and files;l. Shell Oil’s interest in owned or

leased real property associated with theNorco, Louisiana, and Seadrift, Texas,Propylene Polymers plants, togetherwith appurtenances, licenses andpermits;

m. Shell Oil’s interest in owned orleased improvements to real propertyassociated with the Norco, Louisiana,PP Catalyst plant, together withappurtenances, licenses and permits,and a rent-free lease to the landassociated with the PP Catalyst plant forthe life of the plant;

n. Shell Oil’s interest in the Unipol/SHAC Technology Business and in theCooperative Undertaking Agreementdated December 22, 1983, including butnot limited to all future revenue of ShellOil from Unipol PP Technology andShell Catalyst Technology developed,under development, offered for license,or licensed to any person by UCC orShell Oil at any time prior to the dateof transfer to Polyco;

o. Exclusive world-wide rights to allShell Oil trademarks and trade namesrelating to Propylene Polymers otherthan Shell Oil trademarks used by ShellOil for its products generally, such asthe ‘‘SHELL’’ mark and the Pectenemblem;

p. All licenses relating to themanufacture and sale of PropylenePolymers and PP Catalyst or the

licensing of PP Technology or CatalystTechnology, including but not limitedto Shell Oil’s rights under the followingpatents:

(1) All applicable patents of Shell;(2) All patents of Montedison and

Mitsui covered by the July 30, 1985Agreement of Himont Incorporated,Mitsui, Union Carbide Corporation, andShell Chemical Company; any patentlicense agreements between Montedisonand Shell; and any patent licenseagreements between Mitsui and Shell;

(3) Phillips U.S. Patent 4,376,851‘‘crystalline polypropylene’’;

(4) Studiengesellschaft Kohle U.S.Patent 4,125,698 covering production ofPP with a titanium chloride/DEACcatalyst; and

(5) Amoco Chemical Company patentscovering ‘‘PP Catalyst’’ identified in thepatent license agreement betweenAmoco and Shell Oil, including AmocoU.S. Patent 4,540,679; Japan PatentApplication 59350/85 and EuropeanPatent Application 159,150; and

q. Shell Oil’s rights under heTripartite Catalyst Research Agreement;the Polypropylene Agreement betweenShell Research Limited and Shell OilCompany; the PP Catalyst PatentSettlement Agreement between ShellInternationale Research MaatschappijB.V. and Shell Oil Company; and theJuly 30, 1985 Agreement of HimontIncorporated, Mitsui, Union CarbideCorporation, and Shell ChemicalCompany, subject to any necessaryapproval of parties not subject to thisOrder; and

2. All Shell’s worldwide rights to the‘‘SHAC’’ trademark; all customer lists,records and files, all catalogs, and allsales promotion literature relating tosales by Shell outside the United Statesof PP Catalyst and Propylene Polymersmanufactured by Shell Oil; and allinterest in and to contracts entered intoby Shell in the ordinary course ofbusiness with customers, salesrepresentatives, distributors and agentsrelating to the sale, outside the UnitedStates, of PP Catalyst or PropylenePolymers manufactured by Shell Oil(together with associated bid andperformance bonds).

R. ‘‘Viability and competitiveness’’means having the capability andincentive to operate independently atannual levels of research anddevelopment, licensing, production, andsales of PP Technology, CatalystTechnology, PP Catalyst, CatalystSupport and Propylene Polymers atleast equal to levels experienced duringeach of the two (2) calendar yearsimmediately preceding the date oftransfer to Polyco of the Properties to BeDivested, and capable through its own

resources of functioning independentlyand competitively in the PPTechnology, Catalyst Technology, PPCatalyst, and Propylene Polymersbusinesses.

IIIt is further ordered that:A. Shell and Shell oil, as applicable,

shall divest the Properties to BeDivested, absolutely and in good faith,within six (6) months of the date thisOrder becomes final, and shall alsodivest such additional, ancillary assetsand businesses and effect sucharrangements as are necessary to assurethe marketability and the Viability andCompetitiveness of the Properties to BeDivested.

B. The period of six (6) months asspecified in Paragraph II.A shall beextended to March 31, 1997, if either ofthe following conditions is satisfied:

1. Union Carbide declines, withinthirty (30) days following receipt byUnion Carbide of the report of theindependent appraiser, to acquire theProperties to Be Divested for the fairmarket value of the Properties to BeDivested as an operating business asdetermined by an independent appraisalprepared in accordance with thefollowing procedure, or as otherwiseagreed, or at such price as agreed, byShell Oil and Union Carbide:

a. Prior to the expiration of fifteen (15)days from the date this Order becomesfinal shell Oil will notify Union Carbideof Shell Oil’s selection of anindependent appraiser;

b. The independent appraiser selectedby Shell Oil will perform the appraisalunless within fifteen (15) days fromnotification of Shell Oil’s selectedindependent appraiser, Union Carbideobjects to Shell Oil’s selectedindependent appraiser and notifiesShell Oil of its selection of anindependent appraiser;

c. Within fifteen (15) days from thedate the name of Union Carbide’sselected independent appraiser isreceived by Shell Oil, Shell Oil willeither agree to Union Carbide’s selectedindependent appraiser or request thatthe two selected independent appraisersjointly select, within ten (10) days ofsuch request, another independentappraiser;

d. The compensation paid to theindependent appraiser shall be paid byshell Oil or as otherwise agreed by ShellOil and Union Carbide, and the amountof compensation shall be independentof the amount of the fair market valueof the properties to Be Divested asdetermined by the appraisal;

e. The independent appraiser shall beauthorized by Shell to question


personnel and examine all relevantbooks and records, including personneland books and records of the Unipol/SHAC Technology Business, inconnection with the appraisal underappropriate confidentiality provisions;

f. The independent appraisal shall becompleted and presented by theappraiser to Union Carbide and ShellOil within forty-five (45) days of theselection of the appraiser as set forth inthis Paragraph II.B.1 of this Order; or

2. Union Carbide, within (30) days ofreceiving notice from Shell Oil thatShell proposes to divest Polyco to anamed acquirer approved by theCommission, does not consent to thetransfer of Polyco’s interest in theCooperative Undertaking Agreementdated December 22, 1983, to suchCommission approved acquirer.

C. In the event that, prior to theexpiration of the six (6) monthsspecified in Paragraph II.A of this Order,the Commission has neither approvednor disapproved, within sixty (60) daysof receipt of the application, anapplication for approval of a divestitureto a proposed acquirer submitted inaccordance with Paragraphs II.A andII.F of this Order, the time periodspecified in Paragraph II.A of this Ordermay be extended by the Commission bythe number of days in excess of sixty(60) required by the Commission to ruleon the divestiture application and, if theCommission approves divestiture to aperson other than Union Carbide, theCommission may further extend suchperiod, if necessary, by thirty (30) daysin order to provide Shell Oil time tocomply with the requirements ofParagraph II.B.2 of this Order.

D. Provided further, if at the instanceof Union Carbide over the opposition ofShell, Shell is enjoined or otherwiseprohibited by court order from divestingthe Properties to Be Divested, Shellshall promptly give written notice ofsuch order to the Commission,whereupon the period within whichShell shall divest the Properties to BeDivested under Paragraphs II.A, II.B orII.C of this Order shall be extended tothe earlier of (1) one year from theexpiration of the time specified inParagraph II.A of this Order and suchadditional time as may be allowed inParagraphs II.B or II.C of this Order; or(2) ninety (90) days after the injunctionor other order expires.

E. Respondents shall comply with allterms of the Agreement to HoldSeparate, attached to this order andmade a part hereof as Appendix I. SaidAgreement shall continue in effect untilsuch time as Shell and Shell Oil, asapplicable, have divested all theProperties to Be Divested or until such

other time as the Agreement to HoldSeparate provides. Profits accumulatedby Technipol during the period theAgreement to Hold Separate is in effectshall be retained by Montedison uponexpiration of the Agreement to HoldSeparate and shall in no event betransferred to Montell or Shell.

F. Shell and Shell Oil, as applicable,shall divest the Properties to BeDivested as an incorporated, ongoingbusiness, identified herein as ‘‘Polyco’’and established in accordance with theattached Agreement to Hold Separate,and shall divest the Properties to BeDivested only to Union Carbide or toanother acquirer or acquirers thatreceive the prior approval of theCommission, and only in a manner thatreceives the prior approval of theCommission. The purpose of thedivestiture is to ensure the continuationof Polyco as an ongoing and viablebusiness engaged in the research,development, manufacture and sale ofPP Catalyst and Propylene Polymers andin the research, development, andlicensing of PP Technology and CatalystTechnology, and to remedy thelessening of competition resulting fromthe proposed acquisition as alleged inthe Commission’s complaint.

G. The Properties to Be Divested shallbe divested free and clear of (1) allroyalties, mortgages, encumbrances andliens to Shell or Montell; and (2) anycontractual commitments or obligationsto Shell or Montell existing as of thedate of divestiture.

H. Should any transfer of anagreement, contract or license requiredby Paragraph II.A of this Order not bepossible after reasonable effort by Shelland Shell Oil due to a person other thana party to this Order withholding itsconsent to the transfer, Shell Oil shallenter into an agreement with Polyco orthe acquirer thereof the purpose ofwhich agreement is to realize the sameeffect as such transfer. Shell Oil shallsubmit a copy of each such agreementwith its compliance reports to theCommission pursuant to ParagraphsVIII.A and VIII.B of this Order. Further,Shell Oil shall secure, at its expense,patent licenses, or assignments of patentlicenses, extending to Polyco and theacquirer thereof rights and royalty rateswith respect to the manufacture and saleof Propylene Polymers and PP Catalystfrom the Properties to Be Divested, andrights to expand production and sale, noless favorable than those held by ShellOil as of the date of transfer to Polycoof the Properties to Be Divested.

III

It is further ordered that:

A. Prior to transfer of any assets orbusinesses from Shell into Montell ormerger of any part of Shell and Montellor Montedison, Shell shall

1. Extend to Polyco, without royaltyto Shell or Montell, Shell’s rights underagreements relating to the research anddevelopment, manufacture and sale ofPP Catalyst, Catalyst Support, andCatalyst Systems by any person,including but not limited tononexclusive rights to sell, and tocontract with Akzo Nobel for theproduction of, PP Catalyst and CatalystSupport;

2. Disclose to Polyco all Shell CatalystTechnology in its possession or towhich it has rights;

3. Grant Polyco, without royalty toShell or Montell, the perpetual, non-exclusive right (1) to license, subject tothe rights of Union Carbide, ShellCatalyst Technology to any personworldwide; (2) to sell worldwide to anyperson PP Catalyst and Catalyst Systemsbased on Shell Catalyst Technology; and(3) to enforce intellectual property rightswith respect to Shell CatalystTechnology worldwide, includingwithout exclusion the right to sue anyperson who by the manufacture, use orsale of any PP Catalyst or CatalystSystem infringes any Shell patent whichhas been applied for in any country inthe world before the date this Orderbecomes final. All costs of any such suitby Polyco shall be borne by Polyco andall damages recovered shall be retainedby Polyco; and

4. Gant Polyco, without royalty toShell or Montell, the exclusive right,until seven years from the date ofdivestiture of the Properties to BeDivested, (1) to license, subject to therights of Union Carbide, Shell CatalystTechnology to persons other thanMontell and Montell Affiliates; and (2)to sell to persons other than Montell andMontell Affiliates (or LIPP Processlicensees for use in their LIPP Processplants) such PP Catalyst formulations ortheir equivalent as were manufacturedor sold by Shell, or manufactured forShell by Akzo Nobel, prior to the datethis Order becomes final; and

B. Shell and Montell shall grant toPolyco and licensees of Unipol PPTechnology immunity under patentsrelating to PP Technology, CatalystTechnology, PP Catalyst, CatalystSupport, Catalyst Systems or PropylenePolymers, based on work conductedprior to December 31, 1997, or prior toone year after divestiture of theProperties to Be Divested, whichever islater, by persons who, as Shellpersonnel within one (1) year prior tothe date of the formation of Montell, hadaccess to Unipol PP Technology other


than in the public domain and otherthan Catalyst Technology received byShell Oil from other companies of theShell Group.

C. Until one (1) year after divestitureof the Properties to Be Divested no Shellresearch personnel who, within one (1)year prior to the date of the formationof Montell, had access to Unipol PPTechnology (other than CatalystTechnology received by Shell Oil fromother companies of the Shell Group)shall engage in research at facilities ofMontell on PP Technology, ShellCatalyst Technology or MontedisonCatalyst Tchnology. Provided, however,nothing in this Order shall require Shellto conduct any research anddevelopment for any person or to refrainfrom conducting research anddevelopment for, and at the expense of,any person, including Montell andcommunicating with, or receivingcommunications from, such personregarding such research anddevelopment work. The results of anyresearch and development conducted byShell prior to December 31, 1997, or oneyear after divestiture of the Properties toBe Divested, whichever is later, on ShellCatalyst Technology, including but notlimited to research or developmentconducted for, or at the expense of,Montell, shall be provided to Polycowithout payment for use in the Unipol/SHAC Technology Business.

D. Shell (including former employeesof Shell transferred to Montell) shall notprovide, disclose or otherwise makeavailable to Montedison, Technipol,Montell or Montell Affiliates anyMaterial Confidential Informationrelating to Unipol PP Technology or theUnipol/SHAC Technology Business(other than Catalyst Technologyreceived by Shell Oil from othercompanies of the Shell Group),provided however nothing in thisParagraph III.D of this Order shallprohibit (1) Montell Affiliates who arelicensees of Unipol PP Technology fromreceiving information, in accordancewith such license, for use in theirUnipol PP Technology licensedproduction facilities, includinginformation obtained by Shell, prior tothe formation of Montell, under TheTripartite Catalyst Research Agreement;and (2) any communication betweenShell and Montell necessary to ensurethat Montell and its employees make nounauthorized use or disclosure of anyMaterial Confidential Information.

E. Until two (2) years after divestitureof the Properties to Be Divested, Shell,Montell and Technipol shall notemploy, or make offers of employmentto, any person employed by Shall Oilwhose principal duties, during the year

prior to the date of transfer to Polyco ofthe Properties to Be Divested, related tothe management, development oroperation of the Properties to BeDivested. This provision, however, doesnot apply to employment by Shell Oilof any employee who is terminated byPolyco or by the acquirer of theProperties to Be Divested or who is notoffered employment by Polyco or by theacquirer of the Properties to Be Divestedat a base salary that is at leastequivalent, and incentives and benefitsthat are comparable, to those held by theemployee prior to the divestiture of theProperties to Be Divested. Provided,however, Shell Oil shall not be requiredto, but may, terminate employment ofany employee who refuses to acceptemployment with Polyco; Shell Oilshall substitute alternative personnel orequivalent qualifications, education andexperience for any persons declining toaccept employment with Polyco whoare not terminated by Shell. Shell Oilshall encourage and facilitateemployment by Polyco or by theacquirer of the Properties to Be Divestedof employees whose principal duties,during the year prior to the date oftransfer to Polyco of the Properties to BeDivested, related to the management,development or operation of theProperties to Be Divested; shall not offerany incentive to such employees todecline employment with Polyco orwith the acquired or the Properties to BeDivested or to accept other employmentin Shell; and shall remove anyimpediments that exist which may detersuch employees from acceptingemployment with Polyco or with theacquirer of the Properties to BeDivested, including but not limited tothe payment for the benefit of theemployees of all accrued bonuses,pensions and other accrued benefits towhich such employees are entitled as ofthe date of the divestiture. Shall Oilshall not impose any loss of pensionbenefits on employees to which suchemployees are entitled under the ShellOil pension plan as administered underERISA.

IVIt is further ordered that from the date

this Order becomes final and continuinguntil three (3) years following the dateof the divestiture required by this Order,Shell shall, at Polyco’s request or at therequest of the acquirer of the Propertiesto Be Divested, contract with Polyco orthe acquirer of the Properties to BeDivested to supply to Polyco or theacquirer propylene monomer, in suchquantities and product grade as Polycoor the acquirer may request for use inthe Properties to Be Divested subject

only to the capacity and gradeconstraints of Shell’s propylenemonomer production facilities in theUnited States and preexistingcontractual obligations to persons otherthan Shell, Montedison, and Montell.The price, terms, and conditions atwhich Shell shall supply any grade ofpropylene monomer to Polyco and tothe acquirer of the Properties to BeDivested shall be no less favorable toPolyco and the acquirer of theProperties to Be Divested than the price,terms, and conditions at which Shellsupplies such grade of propylenemonomer, directly or indirectly, toMontell in North America, throughexchange or otherwise.

V

It is further ordered that:A. If Shell or Shell Oil, as applicable,

has not divested, absolutely and in goodfaith and with the Commission’s priorapproval, the Properties to Be Divestedwithin the time required by ParagraphII.A of this Order or within suchadditional time as may be allowed inParagraphs II.B, II.C or II.D of this Order,the Commission may appoint a trusteeto divest the Properties to Be Divested.In the event that the Commission or theAttorney General brings an actionpursuant to § 5(l) of the Federal TradeCommission Act, 15 U.S.C. 45(l), or anyother statute enforced by theCommission, Shell shall consent to theappointment of a trustee in such action.Neither the appointment of a trustee nora decision not to appoint a trustee underthis Paragraph shall preclude theCommission or the Attorney Generalfrom seeking civil penalties or any otherrelief available to it, including a court-appointed trustee, pursuant to 5(l) of theFederal Trade Commission Act, or anyother statute enforced by theCommission, for any failure by Shell tocomply with this Order.

B. If a trustee is appointed by theCommission or a court pursuant toParagraph V.A of this Order, Shell shallconsent to the following terms andconditions regarding the trustee’spowers, duties, authority, andresponsibilities:

1. The Commission shall select thetrustee, subject to the consent of Shell,which consent shall not beunreasonably withheld. The trusteeshall be a person with experience andexpertise in acquisitions anddivestitures. If Shell has not opposed, inwriting, including the reasons foropposing, the selection of any proposedtrustee within ten (10) days after noticeby the staff of the Commission to Shellof the identity of any proposed trustee,


Shell shall be deemed to have consentedto the selection of the proposed trustee.

2. Subject to the prior approval of theCommission, the trustee shall have theexclusive power and authority to divestthe Properties to Be Divested.

3. Within ten (10) days afterappointment of the trustee, Shell shallexecute a trust agreement that, subject tothe prior approval of the Commissionand, in the case of a court-appointedtrustee, of the court, transfers to thetrustee all rights and powers necessaryto permit the trustee to effect thedivestiture required by this Order.

4. The trustee shall have twelve (12)months from the date the Commissionapproves the trust agreement describedin Paragraph V.B.3 to accomplish thedivestiture, which shall be subject to theprior approval of the Commission. If,however, at the end of the twelve-monthperiod, the trustee has submitted a planof divestiture or believes that divestiturecan be achieved within a reasonabletime, the divestiture period may beextended by the Commission, or, in thecase of a court-appointed trustee, by thecourt; provided, however, theCommission may extend this periodonly two (2) times.

5. The trustee shall have full andcomplete access to the personnel, books,records and facilities related to theProperties to Be Divested or to any otherrelevant information, as the trustee mayrequest. Shell and Polyco shall developsuch financial or other information assuch trustee may request and shallcooperate with the trustee. Shell andPolyco shall take no action to interferewith or impede the trustee’saccomplishment of the divestitures. Anydelays in divestiture caused by Shell orPolyco shall extend the time fordivestiture under this Paragraph in anamount equal to the delay, asdetermined by the Commission or, inthe case of a court-appointed trustee, bythe court.

6. The trustee shall use his or her bestefforts to negotiate the most favorableprice and terms available in eachcontract that is submitted to theCommission, subject to Shell’s absoluteand unconditional obligation to divestat no minimum price. The divestitureshall be made in the manner and to theacquirer or acquirers as set out inParagraph II.A of this Order; provided,however, if the trustee receives bonafide offers from more than one acquiringentity, and if the Commissiondetermines to approve more than onesuch acquiring entity, the trustee shalldivest to the acquiring entity or entitiesselected by Shell from among thoseapproved by the Commission.

7. The trustee shall serve, withoutbond or other security, at the cost andexpense of Shell, on such reasonableand customary terms and conditions asthe Commission or a court may set. Thetrustee shall have the authority toemploy, at the cost and expense ofShell, such consultants, accountants,attorneys, investment bankers, businessbrokers, appraisers, and otherrepresentatives and assistants as arenecessary to carry out the trustee’sduties and responsibilities. The trusteeshall account for all monies derivedfrom the divestiture and all expensesincurred. After approval by theCommission or, in the case of a court-appointed trustee, by the court, of theaccount of the trustee, including fees forhis or her services, all remaining moniesshall be paid at the direction of Shelland the trustee’s power shall beterminated. The trustee’s compensationshall be based at least in significant parton a commission arrangementcontingent on the trustee’s divesting theProperties to Be Divested.

8. Shell shall indemnify the trusteeand hold the trustee harmless againstany liabilities, losses, claims, damages,or expenses arising out of, or inconnection with, the performance of thetrustee’s duties, including all reasonablefees of counsel and other expensesincurred in connection with thepreparation for, or defense of any claim,whether or not resulting in any liability,except to the extent that such liabilities,losses, claims, damages, or expensesresult from misfeasance, grossnegligence, willful or wanton acts, orbad faith by the trustee.

9. If the trustee ceases to act or failsto act diligently, a substitute trusteeshall be appointed in the same manneras provided in Paragraph V.A. of thisOrder.

10. The Commission or, in the case ofa court-appointed trustee, the court,may on its own initiative or at therequest of the trustee issue suchadditional orders or directions as maybe necessary or appropriate toaccomplish the divestiture required bythis Order.

11. The trustee shall have noobligation or authority to operate ormaintain the Properties to Be Divestedpending completion of the divestiture.

12. The trustee shall report in writingto Shell Oil and the Commission everysixty (60) days concerning the trustee’sefforts to accomplish divestiture.

VIIt is further ordered that:A. Royal Dutch, Shell T&T and

Montedison shall obligate Montell,Montedison shall obligate Technipol,

and Shell Oil shall obligate Polyco, to bebound by this Order and insurecompliance with this Order by Montell,Technipol and Polyco, respectively.

B. Shell, Montedison and Montellshall not restrict any Montell Affiliatefrom licensing PP Technology orCatalyst Technology from the Unipol/SHAC Technology Business orTechnipol or from purchasing PPCatalyst or Catalyst Systems fromPolyco or Technipol.

C. Polyco shall not withhold itsconsent, except for good cause, to UnionCarbide to grant or negotiate license feesand royalty rates below thoseminimums specified in the CooperativeUndertaking Agreement dated December22, 1983, and attachments thereto.

D. Shell, Montedison, Montell andTechnipol shall not enter into or renewany agreement or understanding withany developer or licensor of PPTechnology or Catalyst Technology orany manufacturer, or seller of PPCatalyst, Catalyst Support, or CatalystSystems limiting the geographic areawithin which, or limiting the persons towhom, such person may license PPTechnology or Catalyst Technology ormay manufacture and sell PP Catalyst,Catalyst Support, or Catalyst Systems,unless such agreement or understandingrelates exclusively to markets other thanthe United States and has no effect onUnited States commerce, including butnot limited to export commerce.Nothing in this Paragraph VI.D shallprohibit Shell, Montedison, Montell orTechnipol from legitimately designatinga sales agent for the sale of, or contractmanufacturer for the production of, PPCatalyst or Propylene Polymers in anygeographic area, or from limiting thepersons, geographic area or uses forwhich they respectively grant legitimatelicenses of their PP Technology orCatalyst Technology.

E. Montedison, Montell andTechnipol shall not (1) enforce anyprovision in any agreement with Mitsuiproviding for sharing of royalties withrespect to licenses granted by Mitsuiafter the date this Order becomes finalfor use of PP Technology and CatalystTechnology in the United States inPropylene Polymers plants and in theproduction of Propylene Polymers; or(2) enter into or renew any agreementwith Mitsui providing for sharing ofroyalties with respect to licensing of PPTechnology or Catalyst Technology inthe United States for use in PropylenePolymers plants and in the productionof Propylene Polymers.

VIIIt is further ordered that, for a period

of ten (10) years from the date this Order


becomes final, Shell, Montedison andMontell shall not, without the priorapproval of the Commission, directly orindirectly, through subsidiaries,partnerships, or otherwise:

A. Acquire any stock, share capital,equity, or other interest in any concern,corporate or non-corporate, other thanthe acquisition by Shell or Montedisonof additional shares of Montell, engagedin at the time of such acquisition, orwithin two (2) years preceding suchacquisition engaged in,

1. the research and development(other than only implementation oftechnology licensed from others), or saleor licensing to any person, of PPTechnology or Catalyst Technologyanywhere in the world;

2. the research and development, sale,or manufacture for sale of PP Catalyst,Catalyst Support, or Catalyst Systemsanywhere in the world; or

3. the manufacture or sale ofPropylene Polymers in the United Statesor Canada; or

B. Acquire any assets used for orpreviously used for (and still suitablefor use for)

1. the research and development(other than only implementation oftechnology licensed from others), or saleor licensing to any person, of PPTechnology or Catalyst Technologyanywhere in the world;

2. the research and development, sale,or manufacture for sale of PP Catalyst,Catalyst Support, or Catalyst Systemsanywhere in the world; or

3. the manufacture or sale ofPropylene polymers in the United Statesor Canada.

Provided, however, these prohibitionsshall not relate to the construction ofnew facilities or the acquisition of newor used equipment in the ordinarycourse of business from a person otherthan the persons referred to inParagraph VII.A of this Order. Provided,further that this Paragraph VII of thisOrder shall not apply to the acquisitionof Technipol by Montell followingcompletion of the divestiture of theProperties to Be Divested and expirationof the attached Hold SeparateAgreement.

VIII

It is further ordered that:A. Within sixty (60) days from the

date this Order becomes final and everysixty (60) days thereafter until Shell hasfully complied witht he provisions ofParagraphs II and V of this Order, ShellOil shall submit to the Commission averified written report setting forth indetail the manner and form in which itintends to comply, is complying, andhas complied with Paragraphs II and V

of this Order. Shell Oil shall include inits compliance reports, among otherthings that are required from time totime, a full description of the effortsbeing made to comply with ParagraphsII and V of the Order, including adescription of all substantive contacts ornegotiations for the divestitute and theidentity of all parties contacted. ShellOil shall include in its compliancereports copies of all writtencommunications to and from suchparties, all internal memoranda, and allreports and recommendationsconcerning divestiture.

B. One (1) year from the date thisOrder becomes final, annually for thenext nine (9) years on the anniversary ofthe date this Order becomes final, andat other times as the Commission mayrequire, Royal Dutch, Shell Oil,Montendison and Montell shall each filea verified written report with theCommission setting forth in detail themanner and form in which it hascomplied and is complying with thisOrder.

IX

It is further ordered that Royal Dutch,Shell T&T, Shell Oil, Montedison andMontell shall each notify theCommission at least thirty (30) daysperior to any proposed change in suchcompany, such as dissolution,assignment, sale resulting in theemergence of a successor corporation, orthe creation or dissolution ofsubsidiaries or any other change in suchcompany that may affect complianceobligations arising out of this Order.

X

It is further ordered that, for thepurpose of determining or securingcompliance with this Order, and subjectto any legally recognized privilege,upon written request, and on reasonablenotice, Shell, Montedison and Montellshall each permit any duly authorizedrepresentative of the Commission:

A. Access, during office hours and inthe presence of counsel, to inspect andcopy all books, ledgers, accounts,correspondence, momoranda, and otherrecords and documents in thepossession or under the control of Shell,Montendison or Montell, as applicable,relating to any matters contained in thisOrder; and

B. Upon five (5) days notice to Shell,Montedison or Montell and withoutrestraint or interference from it, tointerview its officers, directors oremployees, who may have counselpresent, regarding such matters.

XI

It is further ordered that this Ordershall terminate twenty (20) years fromthe date this Order becomes final.

Attachment I

In the Matter of: Montedison S.p.A., acorporation, HIMONT Incorporated, acorporation, Royal Dutch PetroleumCompany, a corporation, The ‘‘Shell’’Transport and Trading Company, p.l.c., acorporation, and Shell Oil Company, acorporation, File No. 941–0043.

Agreement to Hold Separate

This Agreement to Hold Separate(‘‘Agreement’’) is by and amongMontedison S.p.A., a corporationorganized, existing and doing businessunder the laws of Italy with its principalexecutive offices located at ForoBuonaparte, 31, 20121 Milan, Italy, andits wholly-owned subsidiary, HIMONTIncorporated, a corporation organized,existing and doing business under thelaws of the State of Delaware with itsprincipal executive offices located atThree Little Falls Centre, 2801Centerville Road, Wilmington, Delaware19850–5439 (collectively‘‘Montedison’’); Royal Dutch PetroleumCompany, a corporation organized,existing and doing business under thelaws of the Netherlands with itsprincipal executive offices located atCarel van Bylandtlaan 30, The Hague,The Netherlands, and The ‘‘Shell’’Transport and Trading Company, p.l.c.,a corporation organized, existing anddoing business under the laws ofEngland with its principal executiveoffices located at Shell Centre, LondonSE1 7NA, England, and their wholly-owned subsidiary, Shell Oil Company, acorporation organized, existing anddoing business under the laws of theState of Delaware with its principalexecutive offices located at One ShellPlaza, Houston, Texas 77002(collectively ‘‘Shell’’); and the FederalTrade Commission (the ‘‘Commission’’),an independent agency of the UnitedStates Government, established underthe Federal Trade Commission Act of1914, 15 U.S.C. § 41, et seq.(collectively, the ‘‘Parties’’).

Premises

Whereas, on or about December 30,1993, Montedison and Shell PetroleumN.V., a holding company of the ShellGroup, entered into an agreementproviding for the merger (hereinafter the‘‘Acquisition’’) of the majority of thepolyolefin assets and businesses ofMontedison (hereinafter the‘‘Montedison Merged Assets’’) and themajority of the polyolefin assets and


businesses of Shell (hereinafter the‘‘Shell Merged Assets’’); and

Whereas, Montedison and Shell eachdevelop a license PP Technology andCatalyst Technology and each develop,manufacture and sell PP Catalyst andPropylene Polymers; and

Whereas, Montedison will establishTechnipol and hold Technipol separatefrom Montell in accordance with theDecision of the Commission of theEuropean Communities in Case No. IV/M. 269–SHELL/MONTECATINI; and

Whereas, the Commission is nowinvestigating the Acquisition todetermine if it would violate any of thestatutes enforced by the Commission;and

Whereas, if the Commission acceptsthe attached Agreement ContainingConsent Order (‘‘Consent Order’’),which would require the divestiture ofcertain assets, the Commission mustplace the Consent Order on the publicrecord for a period of at least sixty (60)days and may subsequently withdrawsuch acceptance pursuant to theprovisions of Section 2.34 of theCommission’s Rules; and

Whereas, the Commission isconcerned that if an understanding isnot reached, preserving the status quoante of the Montedison Merged Assetsand the Shell Merged Assets,respectively, during the period specifiedin Paragraph 4 of this Agreement,divestiture resulting from anyproceeding challenging the legality ofthe Acquisition might not be possible,or might be less than an effectiveremedy; and

Whereas, the Commission isconcerned that if the Acquisition isconsummated, it will be necessary topreserve the Commission’s ability torequire the divestiture of the Propertiesto Be Divested as described in ParagraphI.Q of the Consent Order and theCommission’s right to have theProperties to Be Divested continue as aseparate, viable and independent entity;and

Whereas, the purpose of thisAgreement and the Consent Order is to:

(i) Ppreserve the Properties to BeDivested, also referred to herein as‘‘Polyco,’’ as a viable businessindependent from Montedison, pendingthe divestiture of the Properties to BeDivested as a viable and ongoingenterprise;

(ii) Preserve Technipol as a viablebusiness independent from Shell,pending the divestiture of the Propertiesto Be Divested as a viable and ongoingenterprise; and

(iii) Remedy any anticompetitiveeffects of the Acquisition; and

Whereas, Montedison’s and Shell’sentering into this Agreement shall in noway be construed as an admission byMontedison and Shell that theAcquisition is illegal, and thisAgreement shall in no way be construedas limiting in any way the obligations ofMontedison and Shell pursuant to theDecision of the Commission of theEuropean Communities in Case No. IV/M. 269–SHELL/MONTECATINI; and

Whereas, Montedison and Shellunderstand that no act or transactioncontemplated by this Agreement shallbe deemed immune or exempt from theprovisions of the antitrust laws or theFederal Trade Commission Act byreason of anything contained in thisAgreement.

Now, therefore, upon understandingthat the Commission has not yetdetermined whether the Acquisitionwill be challenged, and in considerationof the Commission’s agreement that,unless the Commission determines toreject the Consent Order, theCommission will not seek a temporaryrestraining order, preliminaryinjunction, or permanent injunctionwith respect to the Acquisition, and inrecognition that the Commission mayexercise any and all rights to enforcethis Agreement and the Consent Orderto which it is annexed and made a partthereof, and, in the event the requireddivestiture is not accomplished, to seekdivestiture of the Properties to BeDivested and such other relief as theCommission may consider appropriate,the Parties agree as follows:

1. Montedison and Shell agree thatfrom the date this Agreement is signedby Shell and Montedison until theearliest of the dates listed in Paragraphs1.a or 1.b, they each will comply withthe provisions of this Agreement:

a. Ten days after the Commissionwithdraws its acceptance of the ConsentOrder pursuant to the provisions ofSection 2.34 of the Commission’s Rules;or

b. The day after the divestiturerequired by the Consent Order has beencompleted.

2. Montedison, Royal Dutch, ShellT&T and Shell Oil agree to execute andbe bound by the attached AgreementContaining Consent Order and tocomply, from the date this Agreement isaccepted, with the provisions of theConsent Order as if it were final.

3. The terms capitalized herein shallhave the same definitions as in theConsent Order. In addition, thefollowing terms used herein shall havethe following definitions:

a. ‘‘Montedison PP Technology’’means PP Technology and CatalystTechnology, including Know-How and

patent rights, developed, under researchand development, used, offered forlicense, or licensed to any person byMontedison at any time prior to the dateof transfer to Technipol of theMontedison Properties to BeTransferred. For purposes of thisAgreement Catalloy process and relatedcatalyst technology and technologyconcerning the production of PPCatalyst or the production of any othercomponent of Catalyst Systems shall beexcluded from ‘‘Montedison PPTechnology.’’

b. ‘‘Montedison Properties to BeTransferred’’ means the businesses,rights and interests, and other assets,tangible and intangible, required to betransferred from Montedison toTechnipol pursuant to Paragraph 8 ofthis Agreement.

c. ‘‘Existing Montedison Licenses’’means licenses of Montedison PPTechnology to persons other thanMontell Affiliates in effect as of the dateof transfer to Technipol of theMontedison Properties to Be Transferredand includes so-called ‘‘catalyst useknow-how licenses,’’ ‘‘process know-how licenses’’ and ‘‘patent licenses.’’

d. ‘‘Improvements’’ means allrefinements, optimizations, or newtechnical developments, patentable orunpatentable, of Know-How, PPTechnology and Catalyst Technology,with commercial application, other thanMajor Advances.

e. ‘‘Major Advances’’ means all newtechnical developments of and changes,patentable or unpatentable, to existingKnow-How, PP Technology and CatalystTechnology with commercialapplication, of the type generallyrecognized in the industry asrevolutionary or of major consequenceand would, upon commercialimplementation, (a) reduce productioncosts of Propylene Polymers by at leastone (1) cent per pound; (b) significantlyincrease the quality, productivity orselling potential of the PP Catalyst,Catalyst Support or Catalyst System, orthe quality or selling potential of thePropylene Polymers; or (c) enableproduction of new Propylene Polymerscommercially competitive primarily inend-uses for which Propylene Polymersproduced and sold commercially havenot been previously suitable fortechnological reasons. Major Advancesinclude, for example:

i. In the case of PP Technology,elimination of a unit operation, additionof a unit operation, or introduction of anew comonomer or additive;

ii. In the case of PP Catalyst, a changein the major type of Catalyst Support;

iii. In the case of Catalyst Systems, achange in the major type of components


or elimination of one componenttogether with a type change in anothercomponent; and

iv. In the case of Propylene Polymers,new compositions or types that displaychemical and physical properties notpreviously achievable by the relevanttechnology.

4. Montedison and Shell agree thatfrom the date this Agreement is signedby Montedison and Shell until March 1,1995, Montedison will hold theMontedison Merged Assets separate andapart from Shell and from Montell, andShell will hold the Shell Merged Assetsseparate and apart from Montedison andfrom Montell.

5. Commencing prior to, orconcurrently with, transfer to Montell ofthe Shell Merged Assets, Shell will holdthe Properties to Be Divested as they arepresently constituted (hereafter‘‘Polyco’’) separate and apart on thefollowing terms and conditions:

a. Shell and Shell Oil, as applicable,shall transfer to Polyco all ownershipand control of the Properties to BeDivested. Polyco shall be held separateand apart and shall be operatedindependently of Shell (meaning hereand hereinafter, Shell excluding Polycoand excluding all personnel connectedwith Polyco as of the date thisAgreement is signed) except to theextent that Shell Oil must exercisedirection and control over Polyco toassure compliance with this Agreementor with the Consent Order.

b. Shell Oil shall separatelyincorporate Polyco and cause Polyco toadopt new Articles of Incorporation andBy-laws and any other requireddocuments for Polyco that are notinconsistent with other provisions ofthis Agreement. Shall Oil shall alsoelect a new six-person board of directorsof Polyco (‘‘New Board’’) prior to, orconcurrently with, transfer of any assetsor businesses from Shell into Montell ormerger of any part of Shell and Montellor Montedison. Questions before theNew Board shall be approved by asimple majority of the directors votingon the matter, provided that Polycoshall engage in no transaction that isprecluded by this Agreement or by theConsent Order. Shell Oil may elect thedirectors to the New Board; provided,however, that such New Board shallconsist of at least three outside directorsneither previously nor currentlyemployed by Shell or Montedison; twoofficers of Polyco; and a maximum ofone Shell Oil (but not Royal Dutch,Shell T&T or Montell) director, officer,employee, or agent; provided, further,that such Shell Oil director, officer,employee or agent shall enter into aconfidentiality agreement in accordance

with the provisions of Paragraph 5.hhereof and shall not be a personinvolved in Shell or Montell’sPropylene Polymers or PP Catalystbusinesses, as defined in Paragraph I. ofthe Consent Order. Such director who isalso a Shell Oil director, officer,employee or agent shall participate inmatters that come before the New Boardonly for the limited purpose of carryingout Shell Oil’s and Polyco’sresponsibilities under this Agreement orunder the Consent Order. Shell Oil willtake no action to delay or limitexpansion of production capacity byPolyco. Except as permitted by thisAgreement, the Shell Oil director shallnot participate in any matter, or attemptto influence the votes of the otherdirectors with respect to matters,including but not limited to expansionof capacity, that would involve aconflict of interest if Shell Oil andPolyco were separate and independententities. In the case of deadlock by theNew Board on any question in whichthe Shell Oil director participates, asecond vote shall be taken on thequestion and the Shell Oil director shallnot vote. The New Board shall includea chairman who is independent of Shelland is competent to assure the continualViability and Competitiveness ofPolyco. Shell Oil shall notify theCommission in its next compliancereport submitted pursuant to ParagraphVIII.A of the Consent Order of theidentity and relevant qualifications andexperience of any person whom ShellOil has appointed as an original orsubsequent director of Polyco.

c. Except for the single Shell Oildirector, officer, employee, or agentserving on the ‘‘New Board’’ (as definedin Paragraph 5.b), Shell shall not permitany director, officer, employee or agentof Shell to also be a director, officer,employee or agent of Polyco. In theevent any members of management ofthe Properties to Be Divested shouldchoose not to accept employment withPolyco, or should retire or otherwiseleave their management positions, thenon-Shell (as Shell is defined inParagraph 5.a hereof) directors servingon the New Board (as defined inParagraph 5.b hereof) shall have theexclusive power to replace suchmembers of management.

d. Polyco shall be staffed withsufficient employees to maintain theViability and Competitiveness of theProperties to Be Divested. Shell, Montelland Technipol shall not employ, ormake offers of employment to, anyperson employed by Shell Oil whoseprincipal duties, during the year prior tothe date of transfer to Polyco of theProperties to Be Divested, related to the

management, development or operationof the Properties to Be Divested. Thisprovision, however, does not apply toemployment by Shell Oil of anyemployee who is terminated by Polycoor who is not offered employment byPolyco at a level of compensation andbenefits at least equivalent to those heldby the employee prior to the date oftransfer to Polyco of the Properties to BeDivested. Shell Oil shall encourage andfacilitate employment by Polyco of ShellOil employees who had lineresponsibility with respect to theProperties to Be Divested in the yearprior to the transfer to Polyco of theProperties to Be Divested; shall not offerany incentive to such employees todecline employment with Polyco oraccept other employment in Shell; andshall remove any impediments that existwhich may deter such employees fromaccepting employment with Polyco,including but not limited to thepayment, or transfer for the account ofthe employee, of all accrued bonuses,pensions and other accrued benefits towhich such employees would otherwisehave been entitled had they remained inthe employment of Shell Oil.

e. Shell shall not exercise direction orcontrol over, or influence directly orindirectly, Polyco; provided, however,that Shell Oil may exercise only suchdirection and control over Polyco as isnecessary to assure compliance withthis Agreement or with the ConsentOrder, including dissolution, merger,consolidation, bankruptcy, sale ofsubstantially all assets, majoracquisitions, issuance of equitysecurities or any change in the legalstatus of Polyco.

f. Shell shall not cause or permit anydestruction, removal, wasting,deterioration or impairment of Polyco,except for ordinary wear and tear. ShellOil shall maintain the marketability andthe Viability and Competitiveness ofPolyco and shall not sell, transfer,encumber (other than in the normalcourse of business) or otherwise impairits marketability or Viability andCompetitiveness. Shell Oil shall providePolyco with sufficient working capitalto operate at current rates of operation,to perform all necessary routinemaintenance to, and replacement of,plant and equipment of the Properties toBe Divested, and to maintain theViability and Competitiveness of theProperties to Be Divested.

g. Shell shall not change thecomposition of the management ofPolyco except that the non-Shell (asShell is defined in Paragraph 5.a hereof)directors or members serving on theNew Board (as defined in Paragraph 5.bhereof) shall have the power to remove


any employee. With the exception of thesingle Shell Oil director, Shell Oil shallnot remove directors of the New Boardexcept for cause.

h. Except as permitted by thisAgreement, the Shell Oil New Boardmember shall not in his or her capacityas a New Board member receiveMaterial Confidential Information andshall not disclose any such informationreceived under this Agreement to Shell,Montedison or Montell or use it toobtain any advantage for Shell,Montedison or Montell. Any Shell Oildirector, officer, employee or agent whoobtains or may obtain confidentialinformation under this Agreement shallenter a confidentiality agreementprohibiting disclosure of confidentialinformation until the day after thedivestitures required by the ConsentOrder have been completed.

i. Except as required by law andexcept to the extent that necessaryinformation is exchange in the course ofdefending investigations or litigation,obtaining legal advice, acting to assurecompliance with this Agreement or theConsent Order (includingaccomplishing the divestitures), ornegotiating agreements to dispose ofassets, Shell, Montedison and Montellshall not receive or have access to, orthe use of, any Material ConfidentialInformation of Polyco, except as suchinformation would be available toMontedison in the normal course ofbusiness if the Acquisition had nottaken place. Any such information thatis obtained by Shell Oil pursuant to thisParagraph shall only be used for thepurposes set out in this Paragraph.Provided, however, until divestiture ofPolyco, hourly personnel assigned toPolyco plant operations may continue tobe covered by existing contractsbetween Shell Oil and any unionsrepresenting such employees; and ShellOil may assign Shell Oil personnel toperform the accounting, analyticalchemistry, human resources,information systems, transportationservices and tax functions for Polycoprovided that such Shell Oil personnelshall enter into confidentialityagreements in accordance with theprovisions in Paragraph 5.h hereof andprovided further that those Shell Oilpersonnel working with MaterialConfidential Information of Polyco shallnot be involved in Montell’s PPTechnology, Catalyst Technology, PPCatalyst or Propylene Polymersbusiness, as defined in Paragraph I. ofthe Consent Order for the period thatShell must comply with Paragraph 5hereof. Provided further that the NewBoard (as defined in subparagraph 5.bhereof) may designate and contract with

Shell Oil as a nonexclusive sales agentfor sales of PP Catalyst or PropylenePolymers by Polyco outside the UnitedStates, provided that all Shell Oilpersonnel with access to MaterialConfidential Information of Polyco inconnection with such contract or agencyshall, prior to gaining such access, enterinto confidentiality agreements inaccordance with the provisions ofParagraph 5.h hereof.

j. All earnings and profits of Polycoshall be retained separately in Polyco.

k. Should any transfer to Polyco of anagreement, contract or license requiredto be included in the Properties to BeDivested not be possible after reasonableeffort by Shell Oil due to another partywithholding its consent to the transfer,Shell Oil shall enter into an agreementwith Polyco the purpose of whichagreement is to realize the same effectas such transfer. Further, Shell Oil shallsecure, at its expense, patent licenses, orassignments of patent licenses,extending to Polyco rights and royaltyrates with respect to the manufactureand sale of Propylene Polymers and PPCatalyst, and rights to expandproduction and sale, no less favorablethan those held by Shell Oil as of thedate of transfer to Polyco of theProperties to Be Divested.

6. Prior to, or concurrently with,transfer to Montell of the Shell MergedAssets, Royal Dutch and Shell T&T shallensure that companies of the ShellGroup shall:

a. Take such actions as are necessaryto establish and maintain separate andapart from Montell the Koninklijke/Shell Laboratorium Amsterdam(‘‘KSLA’’) research and developmentlaboratory of Shell Research B.V., acompany of the Shell Group; and

b. Take such actions as are necessaryto ensure that no Shell researchpersonnel who have had access toUnipol PP Technology (other thanCatalyst Technology received by ShellOil from other companies of the ShellGroup) within one (1) year prior to thedate of the formation of Montell engagein research at facilities of Montell.

7. Shell Oil’s Pecten internationalmarketing organization shall not marketor distribute products of Montell butmay, as requested by Polyco, market anddistribute products produced by Polyco.

8. Prior to, or concurrently with,transfer to Montell of the MontedisonMerged Assets, Montedison shall

a. transfer to Technipol as an ongoingbusiness:

i. PP research and developmentfacilities in the Giulio Natta ResearchCenter in Ferrara, Italy, by outrighttransfer or lease, including transfer of itsPO3 pilot plant, equipment, rights-of-

way, easements, and other rights andassets appropriate and sufficient topreserve the Viability andCompetitiveness of the Montedison PPTechnology business.

ii. The irrevocable worldwide right,for a period not to expire prior to thedivestiture of the Properties to beDivested, to grant to any personperpetual Montedison PP Technologylicenses subject to any lawful rightspreviously granted to persons notparties to this Agreement. This rightshall be exclusive subject to the right ofMontell to license Montell Affiliates.

iii. Existing Montedison Licenses andMontedison’s PP Catalyst supplycontracts with persons other thanMontell Affiliates. Should any suchtransfer not be possible after reasonableeffort by Montedison due to the otherparty withholding its consent to thetransfer, Montedison or Montell shallenter into an agreement with Technipolto service the licenses not transferred toTechnipol and account for revenuesfrom such licenses strictly for thebenefit and account of Technipol, thepurpose of which agreement is to realizeto the extent possible the same effect ofa transfer of such licenses.

iv. Montedison’s PP Catalyst salesbusiness.

v. Personnel who possess the specificskills and experience required byTechnipol sufficient to support, conductand preserve the Viability andCompetitiveness of the MontedisonProperties to Be Transferred.Montedison shall appoint Technipol’smanagers on the basis of demonstratedability and specific experience in theMontedison PP Technology field.

vi. Such other assets (including cashand working capital) and personnel asmay be required to effectuate theremedial purpose of this Order and toassure that Technipol will be capable ofoperating independently at the samelevel of research, development andlicensing of PP Technology, and sale ofPP Catalyst as existed in the MontedisonProperties to Be Transferred on averageduring the two (2) years prior to theTransfer Date.

b. Physically separate, to the extentfeasible, the assets, personnel, officesand facilities transferred or leased toTechnipol from those retained inMontedison and from those transferredto Montell so as to assure theindependence of Technipol fromMontell and to assure that MaterialConfidential Information that is not tobe made available to another personpursuant to the Consent Order and thisAgreement is not accessible to suchperson.


c. Assign to Technipol all otheragreements in which Montedison grantsto a person other than Montell or aMontell Affiliate the right to practiceMontedison PP Technology. Should anysuch assignment not be possible afterreasonable effort by Montedison due tothe other party withholding its consentto the assignment, Montedison orMontell shall enter into an agreementwith Technipol the purpose of which isto realize the effect of such assignment.

d. Take such actions as necessary toensure an ongoing agreement betweenMontell and Technipol pursuant towhich Montell will provide toTechnipol, at Montell’s cost, services(such as building security, fireprotection, trash removal, shipping andreceiving, accounting and cleaningservices), utilities and commonmaintenance for the MontedisonProperties to Be Transferred, as may berequested by Technipol.

Provided, however, that Montedisonshall retain for Montell ownership of,and free right to practice and use, andsell product resulting from the practiceor use of, all Montedison PP Technologyand PP Catalyst production assets.

9. Commencing prior to, orconcurrently with, transfer to Montell ofthe Montedison Merged Assets,Montedison will hold Technipol asconstituted in accordance withParagraph 8 of this Agreement separateand apart on the following terms andconditions:

a. Montedison shall separatelyincorporate Technipol and adoptArticles of Incorporation and By-lawsfor Technipol that are not inconsistentwith other provisions of this Agreement.Montedison shall also elect a board ofdirectors of Technipol prior to, orconcurrently with, transfer to Montell ofthe Montedison Merged Assets.

b. Technipol shall be operatedindependently of Montell and Shell,and neither Shell nor Montell shall haveany ownership or other financialinterest in Technipol or exercisedirection or control over, or influencedirectly or indirectly, Technipol, exceptas specifically authorized by thisAgreement.

c. Montedison shall not permit anydirector, officer, employee or agent ofMontell, or any director, officer,employee or agent of Montedisoninvolved in management or oversight ofMontell, to also be a director, officer,employee or agent of Technipol.

d. Any Montedison director, officer,employee or agent who obtains or mayobtain Material ConfidentialInformation of Technipol under thisAgreement shall not disclose to Shell orMontell such Material Confidential

Information until the day afterdivestiture of the Properties to BeDivested has been completed.

e. Montedison shall not cause orpermit any destruction, removal,wasting, deterioration or impairment ofTechnipol, except for ordinary wear andtear. Montedison shall also maintain theViability and Competitiveness ofTechnipol and shall not sell, transfer,encumber (other than in the normalcourse of business) or otherwise impairits Viability and Competitiveness.

f. The purpose of the formation ofTechnipol and the transfer to it of theMontedison Properties to Be Transferredis to ensure the continuation of aseparate, full-functioning entity toconduct the business of the MontedisonProperties to Be Transferred and topreserve the Viability andCompetitiveness of that business untilthe Properties to Be Divested aredivested.

g. Montell shall provide Technipoland its licensees and prospectivelicensees access to any and all ofMontell’s commercial scale PP plantsusing Montedison PP Technology fordemonstrating the PP Technology andCatalyst Technology used in the plant toprospective licensees and shall providetechnical assistance and training forpersonnel of Technipol’s licensees. Inconsideration for providing suchservices and assistance to Technipol,Montell may charge no more than itsactual hourly cost of pay and benefitsfor the services of Montell personnelproviding technical assistance andtraining and, in the case of technicalassistance or training by Montellpersonnel at a licensee’s or prospectivelicensee’s facilities, reasonable andcustomary travel and per diemsubsistence costs of such personnel.

h. With respect to futureImprovements or Major Advances inMontedison PP Technology byTechnipol or Montell:

i. Technipol and Montell shall eachown any Improvements or MajorAdvances it develops at its own cost orfinances.

ii. Technipol shall have the right tolicense to any person any resultsobtained from research anddevelopment in the field of PPTechnology performed by Technipolunder contract for Montell.

iii. Technipol may grant Montell apaid-up, royalty-free, perpetual andnon-exclusive right to use anyImprovements owned by Technipol orreceived by Technipol from itslicensees.

iv. Technipol may grant Montell anon-exclusive license to use any MajorAdvances owned by Technipol or

received by Technipol from its licenseeson a non-discriminatory basis on termsavailable to other persons.

v. Montell shall grant Technipol apaid-up, royalty-free, perpetual andnon-exclusive right to license personsother than Montell Affiliates to use anyImprovements owned by Montell.

vi. Montell shall grant Technipol theright to license third parties to use anyMajor Advances owned by Montell,unless Montell is contractuallyprohibited, by contract with any personother than a Montell Affiliate or arespondent, from sharing such MajorAdvances with Technipol. Such grant toTechnipol shall be on reasonable termsand conditions which shall, in anyevent, be no less favorable to Technipolthan those offered by Montell to anyperson other than a Montell Affiliate.

i. Technipol shall have the exclusiveright, subject to any lawful rightspreviously granted to persons notparties to this Agreement, to enforceintellectual property rights with respectto Montedison PP Technology, and tosell PP Catalyst to persons other thanMontell and Montell Affiliates.

j. Except as expressly provided in thisAgreement, all sales, licensing and otherbusiness relationships betweenTechnipol and either Montedison, Shellor Montell shall be conducted on a non-discriminatory basis on terms availableto other persons.

k. Pursuant to a PP Catalyst supplyagreement between Montell andTechnipol, Montell shall produce PPCatalyst, including Improvementsthereto, for Technipol for use byTechnipol’s licensees and PP Catalystcustomers, subject to the rights of AkzoNobel. To this end, Montell shalldedicate such portion of its PP Catalystproduction capacity as is required tosupply Technipol’s licensees and PPCatalyst customers. The price for PPCatalyst supplied by Montell toTechnipol shall be negotiated betweenMontell and Technipol, but in no eventshall be more than the lowest contractprice, in terms of the price per poundof Propylene Polymers produced perpound of PP Catalyst, for PP Catalystavailable to a licensee other than aMontell Affiliate or governmentcontrolled licensee, as of December 31,1993, recalculated in accordance withthe pricing formula in the PP Catalystsupply contract for that licensee, lesseight percent (8%).

l. Pursuant to a Catalyst Supportsupply agreement between Montell andTechnipol, Montell shall produceCatalyst Support, includingImprovements thereto, for Technipol forsale to Akzo Nobel. The price forCatalyst Support supplied by Montell to


Technipol shall be negotiated betweenMontell and Technipol, but in no eventshall be more than the price charged toAkzo Nobel as of December 31, 1993,recalculated in accordance with thepricing formula in the Catalyst Supportsupply contract between Akzo Nobeland Himont, less eight percent (8%).

m. Notwithstanding any agreemententered into by Montell and Technipolpursuant to Paragraphs 9.k and 9.l ofthis Agreement, Technipol may acquirePP Catalyst and Catalyst Support fromany other person.

n. Technipol shall provide to Montell,on the date of transfer to Technipol ofthe Montedison Properties to BeTransferred and on the first day of everycalendar quarter thereafter, an estimateof its requirements for PP Catalyst andCatalyst Support for the followingtwelve (12) months. Montell shallsupply PP Catalyst and Catalyst Supportin quantities sufficient to maintain aninventory of PP Catalyst and CatalystSupport equivalent to Technipol’srequirements for PP Catalyst andCatalyst Support for a period of six (6)months. In the event that Montell isunable to maintain an inventory of PPCatalyst and Catalyst Support sufficientto supply Technipol’s requirements forPP Catalyst and Catalyst Support for aperiod of six (6) months, Montell willgrant to Technipol the right and Know-How necessary to produce, or haveproduced on its behalf, PP Catalyst andCatalyst Support.

o. In the case of any shortage of PPCatalyst or Catalyst Support productionMontell shall continue to supplyTechnipol with its requirements exceptthat in the case of shortages that are notthe result of Montell’s actions Montellmay allocate PP Catalyst and CatalystSupport to Technipol and Montell andMontell Affiliates on a pro rata basisbased on the previous twelve (12)months. In the case of any shortage ofPP Catalyst or Catalyst Support toTechnipol, Technipol may request thatMontell expand the productionfacilities, at Montell’s expense, in orderto meet the requirements of Technipol.

p. Technipol shall have the sole rightto determine, subject to PP Catalystsupply contracts with persons otherthan Montell or Montell Affiliatesexisting as of the date the MontedisonProperties to Be Transferred aretransferred to Technipol and theexisting Akzo agreement, the sales price,quantity and type of PP Catalyst andCatalyst Support sold by Technipol toany person.

q. Montell and Shell shall notinterfere in, or attempt to influence, anydecisions or activities of Technipol.

r. Shell, Montedison, Montell,Technipol and Polyco shall notexchange or discuss between each other,directly or indirectly, current or futureintentions, plans or forecasts for pricing,production or capacity for PP Catalyst,Catalyst Support, Catalyst Systems orPropylene Polymers, or royalty rates forlicensing PP Technology or CatalystTechnology to others, except as requiredbetween Montell and Technipol inaccordance with Paragraphs 9.k and 9.lof this Agreement.

10. Except as otherwise provided inthe Consent Order or this Agreement, asrequired for the purpose of tax returnpreparation, compliance with any lawor request from a revenue authority, orto the extent that necessary informationis exchanged in the course of evaluatingand consummating the formation ofMontell, Technipol or Polyco, defendinggovernment investigations or litigation,or negotiating to dispose of assets:

a. Neither Montedison, Montell,Technipol nor Polyco shall provide,disclose or otherwise make available toShell any Material ConfidentialInformation.

b. Neither Montedison nor Technipolshall provide, disclose or otherwisemake available to Montell any MaterialConfidential Information of Technipol.

c. Shell shall not provide, disclose orotherwise make available toMontedison, Montell or Technipol anyMaterial Confidential Information ofPolyco or the Unipol/SHAC TechnologyBusiness (other that CatalystTechnology received by Shell Oil fromother companies of the Shell Group),provided however, nothing in thisParagraph 10.c of this Agreement shallprohibit (a) Montell Affiliates who arelicensees of Unipol PP Technology fromreceiving information, in accordancewith such license, for use in theirUnipol PP Technology licensedproduction facilities, includinginformation obtained by Shell, prior tothe formation of Montell, under TheTripartite Catalyst Research Agreement;and (b) any communication betweenShell and Montell necessary to ensurethat Montell and its employees make nounauthorized use or disclosure of anyMaterial Confidential Information.

d. Neither Montell nor Shell shallprovide, disclose or otherwise makeavailable to Montedison or Technipolany Material Confidential Information.

Provided, however, that nothing inthis Agreement shall limit or prohibit (a)Montell, Technipol or Polyco fromlicensing or otherwise doing businesson a nondiscriminatory basis with eachother or with any entity in whichMontedison or a Shell Group companyhas an interest; or (b) persons elected by

Shell or Montedison to the Montellboard of directors from participating indecisions relating to Montell if they donot also participate in decisions relatingto similar businesses of Technipol orPolyco.

11. To the extent that this Agreementor the Consent Order requires Shell orMontedison to take, or prohibits Shell orMontedison from taking, certain actionsthat otherwise may be required orprohibited by contract, Shell andMontedison shall abide by the terms ofthis Agreement and the Consent Orderand shall not assert as a defense suchcontract rights in a civil penalty actionbrought by the Commission to enforcethe terms of this Agreement or theConsent Order.

12. Should the Federal TradeCommission seek in any proceeding tocompel Shell (meaning here andhereinafter Shell including Polyco) todivest itself of the Montedison MergedAssets, to compel Shell to divest anyassets of businesses of the Shell MergedAssets or the Montedison Merged Assetsthat it may hold, to compel Montedisonto divest itself of the Shell MergedAssets, to compel Montedison to divestany assets or businesses of theMontedison Merged Assets or the ShellMerged Assets that it may hold, or toseek any other injunctive or equitablerelief for any failure to comply with theConsent Order of this Agreement, or inany way relating to the Acquisition,Shell and Montedison shall not raiseany objection based upon the expirationof the applicable Hart-Scott-RodinoAntitrust Improvements Act waitingperiod or the fact that the Commissionhas permitted the Acquisition. Shell andMontedison also waive all rights tocontest the validity of this Agreement.

13. For the purpose of determining orsecuring compliance with thisAgreement, subject to any legallyrecognized privilege, and upon writtenrequest with reasonable notice toMontedison, Shell, Polyco or Montellmade to its principal office,Montedison, Shell, Polyco and Montellshall permit any duly authorizedrepresentative or representatives of theCommission:

a. Access during the office hours ofMontedison or Shell and in the presenceof counsel to inspect and copy all books,ledgers, accounts, correspondence,memoranda, and other records anddocuments in the possession or underthe control of Montedison, Shell, Polycoor Montell relating to compliance withthis Agreement; and

b. Upon ten (10) days notice toMontedison, Shell, Polyco or Montelland without restraint or interferencefrom it, to interview officers or


employees of Montedison, Shell, Polycoor Montell who may have counselpresent, regarding any such matters.

14. This Agreement shall not bebinding on the Commission until it isapproved by the Commission.

Analysis To Aid Public Comment on theProvisionally Accepted Consent Order

The Federal Trade Commission (‘‘theCommission’’) has accepted, for publiccomment, an agreement containing aproposed Consent Order fromMontedison S.p.A. and HimontIncorporated (collectively‘‘Montedison’’) and Royal DutchPetroleum Company, The ‘‘Shell’’Transport and Trading Company, p.l.c.,and Shell Oil Company (collectively‘‘Shell’’). The proposed Consent Orderhas been placed on the public record forsixty (60) days for reception ofcomments from interested persons.Comments received during this periodwill become part of the public record.After sixty (60) days, the Commissionwill again review the agreement and thecomments received and will decidewhether it should withdraw from theagreement or make final the agreement’sproposed Order.

The Commission’s proposedcomplaint alleges that on or aboutDecember 30, 1993, Montedison andShell entered into an agreement to formand acquire equal interests in a jointventure, designated by Montedison andShell as ‘‘Montell’’ and valued at oversix billion dollars, that would merge themajority of Shell’s and Montedison’sworldwide polyolefins businesses. Shellwould retain outside the proposed jointventure polypropylene assets of ShellOil Company (‘‘Shell Oil’’), includingShell Oil’s polypropylene catalyst andpolypropylene resin productionfacilities, Shell Oil’s rights andobligations under a 1983 CooperativeUndertaking Agreement with UnionCarbide Corporation (‘‘Union Carbide’’),pursuant to which Shell Oil and UnionCarbide research, develop and licensepolypropylene technology andpolypropylene catalyst worldwide, andShell Oil’s interest in the SeadriftPolypropylene Company, a partnershipwith Union Carbide which producespolypropylene resin. According to thecomplaint, Shell would nonethelesscontrol Shell Oil as well as Montell.

The proposed complaint further statesthat Montedison coordinates withMitsui Petrochemical Industries Ltd.(‘‘Mitsui’’) in licensing of polypropylenetechnology and in the sale ofpolypropylene catalysts and shares withMitsui royalties from licensing ofpolypropylene technology and catalysttechnology and profits from the sale of

polypropylene catalysts manufacturedin the United States for sale to licenseesin the Western Hemisphere.

The proposed complaint alleges thatthe joint venture agreement betweenMontedison and Shell violates Section 5of the Federal Trade Commission Act, asamended, 15 U.S.C. 45; the proposedjoint venture between Montedison andShell, would, if consummated, violateSection 7 of the Clayton Act, asamended, 15 U.S.C. 18, and Section 5 ofthe Federal Trade Commission Act inthe world markets for polypropylenetechnology, licensing of polypropylenetechnology and the licensing,production and sale of polypropylenecatalysts, and in the United States andCanada markets for the production andsale of polypropylene impact copolymerresin; the proposed joint venture wouldhave an adverse effect on U.S. exporttrade in violation of Section 5 of theFederal Trade Commission Act, asamended, 15 U.S.C. 45; and theagreement between Montedison andMitsui violates Section 5 of the FederalTrade Commission Act.

According to the proposed complaint,polypropylene technology and catalysttechnology are essential for entry intothe production of polypropylene resin,and polypropylene catalysts areessential inputs in the production ofpolypropylene resin. Polypropyleneresin is a thermoplastic with distinctprice/performance characteristics andphysical properties and relatively lowcost and low density. Polypropyleneimpact copolymer resin is a type ofpolypropylene resin with high impactstrength suitable for low temperatureapplications and produced throughcopolymerization, in a second reactor,of polypropylene and ethylene or otherolefin monomers.

As alleged in the proposed complaint,Montedison, through Himont, is theleading competitor in each of therelevant markets. Shell is the secondlargest producer of polypropylenecatalyst, polypropylene resin andimpact copolymer polypropylene resinin the world, is a leader in catalysttechnology, and is a significantcompetitor in the manufacture and saleof polypropylene resin andpolypropylene impact copolymer resinin the United States and Canada. ShellOil and Union Carbide under theCooperative Undertaking Agreement arethe principal competitor to Montedisonin research, development and licensingof polypropylene technology andcatalyst technology. Other technologiesare not a significant competitiveconstraint according to the complaint.

The purpose of the divestiture is toensure continuation of the divested

assets as an ongoing, viable businessengaged, in competition withMontedison and Montell and with othercompanies, in the research,development and licensing ofpolypropylene technology and catalysttechnology and in the manufacture andsale of polypropylene catalysts andpolypropylene resin includingpolypropylene impact copolymer resin,and to remedy any lessening ofcompetition in the relevant marketsresulting from the joint venture. Theproposed Consent Order provides foraccelerated divestiture. However, ifUnion Carbide declines to acquire theassets to be divested by Shell Oil, at fairmarket value as determined by anindependent appraisal or as otherwiseagreed by Shell Oil and Union Carbide,or Union Carbide objects to anotheracquirer approved by the Commission,the divestiture period may be extendedto March 31, 1997. If Shell Oil fails tocomplete the required divestitureswithin the required period, theCommission may appoint a trustee todivest the assets required to be divestedtogether with ancillary assets andbusinesses and arrangements necessaryto assure the marketability of thedivested assets and to assure that theyare viable and competitive in therelevant markets. Any proposeddivestiture pursuant to the Order mustbe approved by the Commission afterthe divestiture proposal has been placedon the public record for reception ofcomments from interested persons.

In addition, the proposed ConsentOrder would prohibit Montedison andMontell from sharing in royalties fromlicenses granted by Mitsui after theOrder becomes final for use ofpolypropylene technology and catalysttechnology in the United States or fromentering into agreements with Mitsui forsharing of licensing royalties in theUnited States and would prohibitMontedison, Shell and Montell fromentering into agreements to allocatemarkets for licensing of polypropylenetechnology and catalyst technology orfor manufacture and sale ofpolypropylene catalysts.

A hold separate agreement executedas part of the Consent prohibits Shelland Montedison from transferring assetsto Montell until March 1, 1995, anduntil Shell has completed the requireddivestiture, requires Shell to preserveand hold separate from Shell andMontell the assets required to bedivested and requires Montedison topreserve, and hold separate from Shelland Montell, assets related toMontedison’s polypropylene technologyand polypropylene catalyst businesses.


For a period of ten years from itseffective date, the Order would alsoprohibit Shell, Montedison and Montellfrom acquiring, without priorCommission approval, stock or otherinterest in any company engaged in, orassets used for, the research anddevelopment, manufacture for sale, orsale or licensing of polypropylenetechnology, catalyst technology orpolypropylene catalyst anywhere in theworld or the manufacture or sale ofpolypropylene polymers in the UnitedStates or Canada.

The purpose of this analysis is toinvite public comment concerning theConsent Order and any other aspect ofthe joint venture or Montedison licenseagreements. This analysis is notintended to constitute an officialinterpretation of the Consent Agreementand Order or to modify its terms in anyway.Donald S. Clark,Secretary.[FR Doc. 95–2061 Filed 1–26–95; 8:45 am]BILLING CODE 6750–01–M

[File No. 941 0126]

Sensormatic Electronics Corporation;Proposed Consent Agreement WithAnalysis To Aid Public Comment


SUMMARY: In 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, SensormaticElectronics Corporation, a Florida-basedmanufacturer of electronic-articlesurveillance systems from acquiringpatents and other exclusive rights formanufacturer installed disposable anti-shoplifting labels from KnogoCorporation. In addition, the consentagreement would require Sensormatic,for ten years, to obtain Commissionapproval before acquiring certain rightsin connection with Knogo’s SuperStrip,or any significant acquisition of entitiesengaged in, or assets used for, theresearch, development or manufactureof disposable labels, or acquisitions ofpatents or other intellectual property forsuch purposes.DATES: Comments must be received onor before March 28, 1995.ADDRESSES: Comments should bedirected to: FTC/Office of the Secretary,Room 159, 6th Street and PennsylvaniaAvenue NW., Washington, DC 20580.FOR FURTHER INFORMATION CONTACT:

Ann Malester, Arthur Strong or MelissaHeydenreich, FTC/S–2224, Washington,DC 20580. (202) 326–2682, 326–3478 or326–2543.SUPPLEMENTARY INFORMATION: Pursuantto Section 6(f) of the Federal TradeCommission Act, 38 Stat. 721, 15 U.S.C.46 and Section 2.34 of the Commission’sRules of Practice (16 CFR 2.34), noticeis hereby given that the followingconsent agreement containing a consentorder to cease and desist, having beenfiled with and accepted, subject to finalapproval, by the Commission, has beenplaced on the public record for a periodof sixty (60) days. Public comment isinvited. Such comments or views willbe considered by the Commission andwill be available for inspection andcopying at its principal office inaccordance with Section 4.9(b)(6)(ii) ofthe Commission’s Rules of Practice (16CFR 4.9(b)(6)(ii).

Agreement Containing Consent OrderThe Federal Trade Commission

(‘‘Commission’’), having initiated aninvestigation of the proposedacquisition by Sensormatic ElectronicsCorporation (‘‘Sensormatic’’) of certainassets of the Knogo Corporation(‘‘Knogo’’), and it now appearing thatSensormatic, hereinafter sometimesreferred to as ‘‘proposed respondent,’’ iswilling to enter into an agreementcontaining consent order to cease anddesist from making certain acquisitions,and providing for other relief:

It is hereby agreed by and betweenSensormatic, by its duly authorizedofficer and its attorney, and counsel forthe Commission that:

1. Proposed respondent Sensormaticis a corporation organized, existing, anddoing business under and by virtue ofthe laws of Delaware, with its officesand principal place of business locatedat 500 NW. 12th Avenue, DeerfieldBeach, Florida 33442.

2. Proposed respondent admits all thejurisdictional facts set forth in the draftof complaint.

3. Proposed respondent waives:a. Any further procedural steps;b. The requirement that the


c. All rights to seek judicial review orotherwise to challenge or contest thevalidity of the order entered pursuant tothis agreement; and


4. This agreement shall not becomepart of the public record of theproceedings unless and until it isaccepted by the Commission. If thisagreement is accepted by the

Commission it, together with the draft ofcomplaint 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 draft of complaint, or that thefacts as alleged in the draft complaint,other than jurisdictional facts, are true.

6. This agreement contemplates that,if it 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 of complaint and itsdecision containing the following orderin disposition of the proceeding, and (2)make information public with respectthereto. When so entered, the ordershall have the same force and effect andmay be altered, modified, or set aside inthe same manner and within the sametime provided by statute for otherorders. The order shall become finalupon service. Delivery by the UnitedStates Postal Service of the complaintand decision containing the agreed-toorder to proposed respondent’s addressas stated in this agreement shallconstitute service. Proposed respondentwaives any right it may have to anyother manner of service. The complaintmay be used in construing the terms ofthe order, and no agreement,understanding, representation, orinterpretation not contained in the orderor the agreement may be used to vary orcontradict the terms of the order.

7. Proposed respondent has read theproposed complaint and ordercontemplated hereby. Proposedrespondent understands that once theorder has been issued, it will berequired to file one or more compliancereports showing that it has fullycomplied 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

IIt is ordered that, as used in this

order, the following definitions shallapply:

A. ‘‘Respondent’’ or ‘‘Sensormatic’’means Sensormatic ElectronicsCorporation, its predecessors,subsidiaries, divisions, and groups andaffiliates controlled by SensormaticElectronics Corporation, their directors,officers, employees, agents, andrepresentatives, and their successorsand assigns.

B. ‘‘Knogo’’ means KnogoCorporation, its predecessors,subsidiaries, divisions, and groups andaffiliates controlled by Knogo, theirdirectors, officers, employees, agents,and representatives, and theirsuccessors and assigns.

C. ‘‘KNA’’ means Knogo NorthAmerica, Inc., the successor corporationto Knogo Corporation’s business andassets in the United States and Canadato be formed pursuant to theContribution and Divestiture Agreementbetween Knogo Corporation and KnogoNorth America, Inc., its subsidiaries,divisions, and groups and affiliatescontrolled by Knogo North America,Inc., their directors, officers, employees,agents, and representatives, and theirsuccessors and assigns.

D. ‘‘Commission’’ means the FederalTrade Commission.

E. ‘‘Acquisition’’ means thetransaction described in the Agreementand Plan of Merger among Sensormatic,Knogo, and KNA, dated August 14,1994.

F. ‘‘Hard goods EAS systems’’ meanselectronic article surveillance systemsand components designed principally toprotect against shoplifting of hard goodsmerchandise (e.g., books, audiorecordings, health and beauty aids,groceries, and home centermerchandise), by means of electronichardware capable of detectingdisposable labels attached to suchmerchandise, whether the systems orcomponents generate, detect, or employradio frequency, electromagnetic,microwave, acoustic magnetic, or otherelectronic signals. Such systems andcomponents may include electronicsignal transmitters and receivers, signalprocessing equipment, computersoftware, label activation equipment,label deactivators, automatic andmanual label applicators, and otherrelated devices.

G. ‘‘Disposable labels’’ means labelsthat can be affixed to or embedded inretail merchandise and used inconjunction with hard goods EASsystems.

H. ‘‘Source labelling’’ means theprocess by which manufacturers,packagers, or independent wholesalersapply disposable labels to retailmerchandise or its packaging.

I. ‘‘SuperStrip’’ means:1. The material, described in Exhibit

A attached hereto and made a parthereof, used or intended for use indisposable labels; and

2. Disposable labels incorporatingsuch material.

J. ‘‘SuperStrip Technology’’ means allexisting patents, inventions, tradesecrets, know-how, concepts, designs,technical information, processes, andintellectual property relating to thedesign, manufacture, or use ofSuperStrip.

K. ‘‘SuperStrip Improvements’’ meansall improvements. modifications,developments, revisions, orenhancements of SuperStrip orSuperStrip Technology, whether or notcovered by a patent or otherwiseprotected against disclosure orunauthorized use by law.

L. ‘‘Supply Agreement’’ meansExhibit B to the Contribution andDivestiture Agreement, attached asExhibit C to the Agreement and Plan ofMerger among Sensormatic, Knogo, andKNA, dated August 14, 1994, thatrequires Sensormatic to purchaseproducts and materials for hard goodsEAS systems from KNA upon the termsand conditions set forth therein.

M. ‘‘United States’’ means the fiftystates, the District of Columbia, andPuerto Rico.

II

It is further ordered that:A. As of the date this order becomes

final, respondent shall not hold,possess, receive, or otherwise obtain, orhave held, possessed, received, orotherwise obtained, the SuperStripTechnology from Knogo or KNA.Provided, however, that no provision ofthis Order shall prohibit an acquisitionby respondent from Knogo or KNA of:(1) a non-exclusive license of theSuperStrip Technology to practice anduse SuperStrip and SuperStripTechnology in the United States andCanada; and (2) ownership of, or otherexclusive or non-exclusive legal orequitable rights to practice and use,SuperStrip, SuperStrip Technology, andSuperStrip Improvements outside of theUnited States and Canada.

B. Respondent shall comply with theterms and conditions of the SupplyAgreement.

III

It is further ordered that, for a periodof ten (10) years from the date this order

becomes final, respondent shall not,without the prior approval of theCommission, directly or indirectly,through subsidiaries, partnerships, orotherwise:

A. Acquire any legal or equitablerights to practice and use SuperStrip,SuperStrip Technology, or SuperStripImprovements in the United States andCanada other than: (1) Rights tomanufacture in the United States forexport only; or (2) a non-exclusivelicense that is also offered to othermanufacturers of hard goods EASsystems or disposable labels inconnection with adoption of a retailsegment standard;

B. Acquire any stock, share capital,equity or other interest in any person orconcern, corporate or non-corporate,engaged at the time of such acquisitionin, or within the two (2) years precedingsuch acquisition engaged in, theresearch, development, or manufactureof disposable labels designed or used forsource labelling; provided, however,that individual employees or directorsof respondent and each pension, benefit,or welfare plan or trust controlled byrespondent may acquire, for investmentpurposes only, an interest of not morethan one (1) percent of the stock orshare capital of such person or concern;or

C. Acquire any patents, intellectualproperty, or other tangible or intangibleassets, other than a non-exclusivelicense, used in or previously used in(and still suitable for use in) theresearch, development, or manufactureof disposable labels designed or used forsource labelling.

Provided, however, that anacquisition pursuant to Paragraph III.B.or III.C. shall be exempt from the priorapproval requirements of this ParagraphIII if: (1) The stock, share capital, equity,or assets are acquired from a person orconcern that had less than $2 million inannual sales in the United States ofdisposable labels in either of the two (2)most recent calendar years precedingsuch acquisition; (2) the acquisition is ofassets relating solely to the manufactureof, improvements of, or accessories toSensormatic products that are inexistence as of the time of theacquisition; (3) the acquisition is ofassets from or an interest in a jointventure in which respondent is oneparticipant and in which no other jointventure participant was at the time ofthe commencement of the ventureengaged in the research, development,or manufacture of disposable labels inthe United States; (4) the acquisition isof rights or other assets to be used solelyin commercial or industrial (i.e., non-retail) applications; or (5) the


acquisition is of rights or other assets(other than United States or Canadianmarketing rights to patents, trade secretsand other intellectual property) to beused solely for products sold outside theUnited States and Canada.

IVIt is further ordered that within sixty

(60) days after the date this orderbecomes final, one year (1) from the datethis order becomes final, and annuallyfor the next nine (9) years on theanniversary of the date this orderbecomes final, and at such other timesas the Commission may require,respondent shall file a verified writtenreport with the Commission settingforth in detail the manner and form inwhich it has complied and is complyingwith this order.

VIt is further ordered that respondent

shall notify the Commission at leastthirty (30) days prior to any proposedchange in the corporate respondent suchas dissolution, assignment, saleresulting in the emergence of asuccessor corporation, or the creation ordissolution of subsidiaries or any otherchange in the corporation that mayaffect compliance obligations arising outof the order.

VIIt is further ordered that, for the

purpose of determining or securingcompliance with this order, subject toany legally recognized privilege andupon written request with reasonablenotice, respondent shall permit anyduly authorized representatives of theCommission:

A. Access, during office hours and inthe presence of counsel, to inspect andcopy all books, ledgers, accounts,correspondence, memoranda and otherrecords and documents in thepossession or under the control ofrespondent relating to any matterscontained in this order; and

B. Upon five (5) days’ notice torespondent and without restraint orinterference from it, to interviewofficers, directors, or employees ofrespondent, who may have counselpresent regarding such matters.

Exhibit A—SuperStrip Material

SuperStrip ISuperStrip I is covered by Patent

numbers 5,029,291 (docket number85.151) and 5,304,987 (docket number85.168) and one invention disclosure (asdescribed in docket number 85.184).These patents and disclosure describe anew type of oxidized magnetic materialwith an asymmetrical hysteresis curve

and the ability to become magneticallydeactivated. SuperStrip I material isproduced by a process, as described inKnogo’s patent, that involves the cuttingof amorphous magnetic material intoshort, tag-length segments andannealing these segments for severalhours in the presence of a magneticfield.

SuperStrip IISuperStrip II is a modified version of

Knogo’s standard magnetic tag. Shortdeactivation segments are electroplatedonto the soft part of the magnetic stripin a continuous process instead of beingmechanically cut and adhered to thestrip. A U.S. patent application (docketnumber 85.180) filed by Knogo ispending with respect to this process.

SuperStrip IIISuperStrip III, which is the subject of

a pending U.S. patent application(docket #85.191) filed by Knogo is arecent development involving the melt-spin casting of a specially formulatedamorphous magnetic material in such away as to produce a unique hysteresiscurve in a manner similar to that ofSuperStrip I, but without the use of anyadditional processing steps beyondcasting the material.

Analysis of Proposed Consent Order ToAid Public Comment

The Federal Trade Commission(‘‘Commission’’) has accepted, subject tofinal approval, an agreement containinga proposed Consent Order fromSensormatic Electronics Corporation(‘‘Sensormatic’’), which prohibitsSensormatic from acquiring certainpatents from Knogo Corporation(‘‘Knogo’’) for the practice and use ofSuperStrip technology (‘‘SuperStrip’’) inthe United States and Canada.

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.

On August 14, 1994, Sensormatic andKnogo entered into an agreementwhereby Sensormatic agreed to acquirethrough a merger all of Knogo’s assetsoutside of North America, along withpatents related to SuperStrip; theagreement also obligated Sensormaticand Knogo North America, Inc.(‘‘Knogo/NA’’), a successor corporationto Knogo’s business and assets in theUnited States and Canada, to grant

royalty-free cross-licenses to oneanother for any improvements to patentsor trade secrets related to SuperStrip(‘‘SuperStrip Improvements’’). Theproposed complaint alleges that theproposed acquisition, if consummated,would constitute a violation of Section7 of the Clayton Act, as amended, 15U.S.C. § 18, and Section 5 of the FTCAct, as amended, 15 U.S.C. § 45, in themarket for the research anddevelopment of disposable labelsdeveloped or used for source labellingand the research and development ofprocesses to manufacture disposablelabels in the United States and Canada.

Knogo has been developingSuperStrip for possible use as adisposable source label with electronicarticle surveillance systems, which areinstalled in retail stores as theftprevention devices. Disposable sourcelabels would be imbedded in goods orpackaging at the manufacturing ordistribution level, and they wouldobviate the need for retailers to installlabels themselves. Sensormatic has beendeveloping one of its proprietarytechnologies for potential use as asource label.

The proposed Consent Order wouldremedy the alleged violation byprohibiting Sensormatic from acquiringthe SuperStrip patents and intellectualproperty in the United States andCanada. The proposed order allowsSensormatic to acquire a non-exclusivelicense to use the technology forproducts manufactured or sold in theUnited States and Canada, and it allowsSensormatic to acquire exclusive rightsto such technology outside the UnitedStates and Canada. Finally, theproposed Consent Order would requireSensormatic to comply with the termsand conditions of a supply agreementbetween Sensormatic and Knogo/NA

The proposed Order will also prohibitSensormatic, for a period of ten (10)years, from acquiring, without FederalTrade Commission approval, other legalor equitable rights to use the SuperStriptechnology or SuperStripImprovements, any stock in any concernengaged in the research, development,or manufacture of disposable labelsdesigned or used for source labelling, orany patents or other intellectualproperty used in the research,development, or manufacture ofdisposable labels designed or used forsource labelling. The prior approvalprovisions contain several provisos,which exempt certain acquisitions fromthe prior approval requirements.

Under the provisions of the ConsentOrder, Sensormatic is also required toprovide to the Commission a report ofits compliance with the Order within


sixty (60) days after the date this Orderbecomes final, one (1) year from the datethis order becomes final, and annuallythereafter for the next nine (9) years.The Consent Order also requiresSensormatic to notify the Commission atleast thirty (30) days prior to any changein the structure of Sensormatic resultingin the emergence of a successor.

The purpose of this analysis is tofacilitate public comment on theproposed Order, and it is not intendedto constitute an official interpretation ofthe agreement and proposed Order or tomodify in any way their terms.Donal S. Clark,Secretary.

Statement of Commissioner Mary L.Azcuenaga Concurring in Part andDissenting in Part in SensormaticElectronics Corp., File No. 941–0126

Today the Commission accepts forpublic comments a consent order thatwould settle allegations thatSensormatic Electronics Corporation’sacquisition of Knogo Corporation’spatents related to SuperStrip and theagreement to cross-licenseimprovements to SuperStrip violateSection 7 of the Clayton Act and Section5 of the Federal Trade Commission Act.I find reason to believe the transactionviolates the law and concur in acceptingthe consent order for publication. Idissent, however, from the allegations inthe complaint defining the relevantmarket and from paragraph II(B) of theorder, which requires that Sensormaticadhere to a private supply contract.

Sensormatic and Knogo produce andsell electronic article surveillance (EAS)systems and components, used byretailers to protect against shoplifting.EAS systems provide a warning when aspecial label attached to merchandise bythe retailer triggers an electronic signalon hardware located at the store’s exitunless the label has been neutralized bystore employees at the time of sale.Because Sensormatic proposes toacquire only those assets of Knogolocated outside North America, thecompetitive analysis of the transactiondoes not focus on the production andsale of existing EAS systems and labelsto retailers in the United States andCanada.

Sensormatic, Knogo, and other firms,however, are also engaged in researchand development to perfect a new‘‘source labelling’’ system. In such asystem, manufacturers would apply theEAS label to the merchandise or itspackaging, which would eliminate theneed for retailers manually to affix alabel to each protected item ofmerchandise. No source labellingsystem is currently in use, but Knogo

has developed and patented SuperStriptechnology for use in labels, potentiallyincluding source labels, and other firmsare developing their own sourcelabelling technologies.

I concur that the relevant marketinvolves competition in research anddevelopment, but question the marketdefinition in paragraph 11 of thecomplaint, which is narrowly limited tothe research and development of‘‘disposable labels developed or used forsource labelling’’ and processes to makethem. In a Section 7 case, theCommission has the burden of provingthe relevant product market, anddistinguishing research anddevelopment of source labelling fromother improvements in EAS systemsmay be difficult or impossible. I wouldnot limit the product market to researchand development in source labelling butwould define the market as research anddevelopment in EAS systems andcomponents, including source labelling.

I also dissent from paragraph 12 of thecomplaint, which limits the geographicmarket to the United States and Canada.Successful research and developmentyields intellectual property that canmove freely across internationalboundaries. A foreign firm can licenseintellectual property withoutestablishing a manufacturing or salespresence in the United States. Limitingthe geographic market to the UnitedStates and Canada excludes from themarket the potentially importantresearch activity of at least oneEuropean firm. Even if domestic firmsare familiar with particular technologiesand have a sizable base of equipmentalready installed in retail stores,research and development may yield animprovement significant enough toovercome the advantages of currentmarket leaders. The market should notbe so narrowly defined as to presumethat only North American firms couldeffect a significant breakthrough thatmight alter the current competitivebalance.

Applying Section 7 analysis to theproducts and geographic markets as Iwould define them, I find reason tobelieve the transaction would violatethe law. The proposed acquisitionwould significantly increase theconcentration in the already highlyconcentrated world market for EASsystem research and development. Theproposed transaction, the transfer ofpatents from Knogo to Sensormatic andthe agreement to grant royalty-free crosslicenses on any improvements toSuperStrip, likely would diminishcompetition in research anddevelopment of new EAS systems and

components. Accordingly, I concur inparagraph II(A) of the order.

Finally, I dissent from paragraph II(B)of the order, which provides thatSensormatic ‘‘shall comply with theterms and conditions’’ of a supplyagreement between Sensormatic andKnogo North America, Inc., thesuccessor corporation to Knogo’s NorthAmerican business. The supplyagreement is a long, highly detailedcommercial contract that was negotiatedas part of the acquisition in question.The complaint contains no allegationsestablishing a relationship between thiscontract and the state of competition inany antitrust market. Absent ademonstrable link between the contractand competition, the contract providesno basis for liability and compliancewith the contract does not appearnecessary to effect relief.




[Docket No. 94M–0414]

Pilkington Barnes Hind USA;Premarket Approval of Precision UVTM

(Vasurfilcon A) Hydrophilic ContactLens for Extended Wear

AGENCY: Food and Drug Administration,HHS.ACTION: Notice.

SUMMARY: The Food and DrugAdministration (FDA) is announcing itsapproval of the application byPilkington Barnes Hind, USA,Sunnyvale, CA, for premarket approval,under the Federal Food, Drug, andCosmetic Act (the act), of the PrecisionUVTM (vasurfilcon A) HydrophilicContact Lens for extended wear. Thedevice is to be manufactured under anagreement with Allergan MedicalOptics, Irvine, CA, which hasauthorized Pilkington Barnes Hind,USA to incorporate informationcontained in its approved premarketapproval application (PMA) for thelidofilcon B nonultraviolet absorbinglens material and all relatedsupplements that lead to the approval ofthe vasurfilcon A material. FDA’s Centerfor Devices and Radiological Health(CDRH) notified the applicant, by letterof September 30, 1994, of the approvalof the application.DATES: Petitions for administrativereview by February 27, 1995.


ADDRESSES: Written requests for copiesof the summary of safety andeffectiveness data and petitions foradministrative review to the DocketsManagement Branch (HFA–305), Foodand Drug Administration, rm. 1–23,12420 Parklawn Dr., Rockville, MD20857.

FOR FURTHER INFORMATION CONTACT:James F. Saviola, Center for Devices andRadiological Health (HFZ–460), Foodand Drug Administration, 9200Corporate Blvd., Rockville, MD 20850,301–594–1744.

SUPPLEMENTARY INFORMATION: On August12, 1994, Pilkington Barnes Hind, USA,Sunnyvale, CA 94086–5200, submittedto CDRH an application for premarketapproval of the Precision UVTM

(vasurfilcon A) Hydrophilic ContactLens for extended wear. The device isa spherical soft (hydrophilic) contactlens and is indicated for nonaphakicdaily or extended wear from 1 to 7 daysbetween removals for cleaning, rinsing,and disinfecting, as recommended bythe eye care practitioner. Candidates touse the Precision UVTM HydrophilicContact Lens include persons who arenearsighted (myopic) and farsighted(hyperopic) and who may haveastigmatism of 2.0 diopters or less thatdoes not interfere with visual acuity.

The application includesauthorization from Allergan MedicalOptics, Irvine, CA, 92713–9534, toincorporate information contained in itsapproved PMA for lidofilcon Bnonabsorbing ultraviolet lens materialand all related supplements that lead tothe approval of the vasurfilcon Amaterial.

In the Federal Register of March 4,1994 (59 FR 10397), CDRH published anorder which reclassified daily wear softand daily wear nonhydrophilic plasticcontact lenses from class III (premarketapproval) into class II (special controls).CDRH notes that the daily wearindication for this lens has receivedmarketing clearance as a class II devicethrough the premarket notification(510(k)) procedures.

In accordance with the provisions ofsection 515(c)(2) of the act as amendedby the Safe Medical Devices Act of1990, this PMA was not referred to theOphthalmic Devices Panel, an FDAadvisory panel, for review andrecommendation because theinformation in the PMA substantiallyduplicates information previouslyreviewed by this panel. On September30, 1994, CDRH approved theapplication by a letter to the applicantfrom the Director of the Office of DeviceEvaluation, CDRH.

A summary of the safety andeffectiveness data on which CDRHbased its approval is on file in theDockets Management Branch (addressabove) and is available from that officeupon written request. Requests shouldbe identified with the name of thedevice and the docket number found inbrackets in the heading of thisdocument.

Opportunity for Administrative Review

Section 515(d)(3) of the act (21 U.S.C.360e(d)(3)) authorizes any interestedperson to petition, under section 515(g)of the act (21 U.S.C. 360e(g)), foradministrative review of CDRH’sdecision to approve this application. Apetitioner may request either a formalhearing under part 12 (21 CFR part 12)of FDA’s administrative practices andprocedures regulations or a review ofthe application and CDRH’s action by anindependent advisory committee ofexperts. A petition is to be in the formof a petition for reconsideration under§ 10.33(b) (21 CFR 10.33(b)). Apetitioner shall identify the form ofreview requested (hearing orindependent advisory committee) andshall submit with the petitionsupporting data and informationshowing that there is a genuine andsubstantial issue of material fact forresolution through administrativereview. After reviewing the petition,FDA will decide whether to grant ordeny the petition and will publish anotice of its decision in the FederalRegister. If FDA grants the petition, thenotice will state the issue to bereviewed, the form of review to be used,the persons who may participate in thereview, the time and place where thereview will occur, and other details.

Petitioners may, at any time on orbefore February 27, 1995, file with theDockets Management Branch (addressabove) two copies of each petition andsupporting data and information,identified with the name of the deviceand the docket number found inbrackets in the heading of thisdocument. Received petitions may beseen in the office above between 9 a.m.and 4 p.m., Monday through Friday.

This notice is issued under theFederal Food, Drug, and Cosmetic Act(secs. 515(d), 520(h) (21 U.S.C. 360e(d),360j(h))) and under authority delegatedto the Commissioner of Food and Drugs(21 CFR 5.10) and redelegated to theDirector, Center for Devices andRadiological Health (21 CFR 5.53).

Dated: January 11, 1995.Joseph A. Levitt,Deputy Director for Regulations Policy, Centerfor Devices and Radiological Health.[FR Doc. 95–2112 Filed 1–26–95; 8:45 am]BILLING CODE 4160–01–F

Public Health Service

Agency Forms Submitted to the Officeof Management and Budget forClearance

Each Friday the Public Health Service(PHS) publishes a list of informationcollection requests it has submitted tothe Office of Management and Budget(OMB) for clearance in compliance withthe Paperwork Reduction Act (44 U.S.C.Chapter 35). The following requestshave been submitted to OMB since thelist was last published on Friday,January 6, 1995.(Call PHS Reports Clearance Officer on202–690–7100 for copies of request)

1. Registration of Cosmetic ProductEstablishment—0910–0027 (Extension,no change)—The voluntary registrationof cosmetic manufacturers andrepackers supplies the Food and DrugAdministration (FDA) with currentlocations for on-site inspections,addresses for information and regulatorymailings, business trading namessupplying product distribution sources,and aids FDA in responding to FOIrequests. Respondents: Business orother for-profit; Number ofRespondents: 50; Number of Responsesper Respondent: 1; Average Burden perResponse: 0.4 hour; Estimated AnnualBurden: 20 hours.

2. Progress Toward EliminatingOccupational Lead Poisoning: Surveyon the Use of Lead in Industry andControl of Occupational Lead Exposurein Ohio—New—This suvey willexamine the types of lead-usingcompanies doing environmental and/orbiological monitoring. The results willbe used to target the technical assistanceresources of the National Institute ofOccupational Safety and Health to thoseindustries with uncontrolled leadexposures and those industries thatshould be doing monitoring and are not.Respondents: Business or other for-profit; Number of Respondents: 1,806;Number of Responses per Respondent:1; Average Burden per Response: 3hours; Estimated Annual Burden: 5,413hours.

3. Small Business InnovationResearch Grant Applications Phase Iand Phase II and Small BusinessTechnology Transfer Grant ApplicationsPhase I and II—0925–0195 (Revision)—The purpose of the Small Business


Innovation Research (SBIR) Phase I andPhase II applications and the SmallBusiness Technology Transfer (STTR)Phase I and Phase II applications is toprovide a vehicle by which smallbusiness concerns can apply foravailable research funds. Thisinformation is used by PHS todetermine those applicants scientificallyand administratively qualified to receivepublic funds for projects relevant toPHS programs. Respondents: Businessor other for-profit.

Title

Numberof re-

spond-ents

Numberof re-

sponsesper re-spond-

ent

Averageburdenper re-sponse(hours)

SBIR andSTTRphase I ..... 3,400 1 30

SBIR andSTTRphase II .... 600 1 40

Estimated Total Annual Burden:126,000 hours.

4. Pesticide Residue Study (15months) of Monthly Rice ProductionVolumes from Operating U.S. RiceMills—New—As part of the Food andDrug Administration’s (FDA) continuingeffort to improve the pesticide program,monitoring studies are needed.Department of Agriculture inspectors,which regularly inspect mills, haveobtained monthly samples from knowndomestic rice production mills over a15-month period. FDA is proposing toquery these domestic rice mills, whichprocess virtually all rice milled in theU.S., to obtain information on theirmonthly ‘‘pounds of finished riceproduced’’ between October 1993 andDecember 1994. FDA needs thisinformation to determine how thissampling approach differs historicallyfrom the data obtained from theAgency’s traditional sampling approach.Respondents: Business or other for-profit; Number of Respondents: 43;Number of Responses per Respondent:1; Average Burden per Response: 1hour; Estimated Annual Burden: 43hours.

5. Protection of Human Subjects—Recordkeeping and ReportingRequirements Institutional ReviewBoards (21 CFR 56)—0910–0130(Reinstatement)—Documentation of IRBactivities and retention of those recordsare necessary for the Food and DrugAdministration to be able to assesscompliance with regulations duringinspections. Respondents: Business orother for-profit, Federal Government,Not for-profit institutions; Number of

Respondents: 2,000; Number ofResponses per Respondent: 1; AverageBurden per Response: 65 hours;Estimated Annual Burden: 131,400hours.

6. Services Research Outcomes Study(SROS)—Main Study—0930–0167—TheService Research Outcomes Studyemploys a national sample of substanceabuse treatment clients to gatherinformation required in the formulationof national drug policy. A sample of3,000 treatment clients will be followedup through records and personalinterview to obtain information on druguse, criminal activity, and treatmentutilization patterns. Respondents:Individuals or households; Number ofRespondents: 2,295; Number ofResponses per Respondent: 1; AverageBurden per Response: 2.005 hours;Estimated Annual Burden: 4,602 hours.

7. Color Additive Certification, 21CFR 80, Subpart B—0910–0216—(Extension, no change)—Theinformation collected is required by theFood and Drug Administration for thepurpose of responding to requests for‘‘Color Certification’’ of color additivesas required in Section 721 of the FD&CAct and the regulations promulgated in21 CFR Part 80. The activity includeschemical analysis for batch compositionof a representative sample to insurecompliance with applicablespecifications and issuance of acertification lot number. Respondentsare any persons requesting certificationof a manufactured batch of coloradditive. Respondents: Business orother for-profit.

Title

Numberof re-

spond-ents

Numberof re-

sponsesper re-spond-

ent

Averageburdenper re-sponse(hours)

Reporting:Requestfor Certifi-cation—22CFR 80.21 27 145 .216

Samples ofBatch Col-ors—22CFR 80.22 27 145 0.033

Record-keeping:Records ofDistribu-tion—21CFR 80.39 27 1 36.3

Estimated Total Annual Burden: 1,958hours.

Written comments andrecommendations concerning theproposed information collectionsshould be sent within 30 days of this

notice directly to OMB Desk Officerdesignated below at the followingaddress: Shannah Koss, HumanResources and Housing Branch, NewExecutive Office Building, Room 10235,Washington, D.C. 20503.

Dated: January 23, 1995.James Scanlon,Director, Division of Data Policy, Office ofHealth Planning and Evaluation.[FR Doc. 95–2120 Filed 1–26–95; 8:45 am]BILLING CODE 4160–17–M

Social Security Administration

1994–95 Advisory Council on SocialSecurity; Meeting

AGENCY: Social Security Administration,HHS.ACTION: Notice of public meeting.

SUMMARY: In accordance with theFederal Advisory Committee Act, thisnotice announces a meeting of the1994–95 Advisory Council on SocialSecurity (the Council).DATES: Friday, February 10, 1995, 8:30a.m. to 5 p.m. and Saturday, February11, 1995, 9 a.m. to 12 noon.ADDRESSES: The Sheraton City Centre,1143 New Hampshire Avenue, NW.,Washington, DC 20037, (202) 775–0800.FOR FURTHER INFORMATION CONTACT: Bymail—Dan Wartonick, 1994 AdvisoryCouncil on Social Security, Room 624D,Hubert H. Humphrey Building, 200Independence Avenue, SW.,Washington, DC 20201; By telephone—(202) 205–4861; By telefax—(202) 205–4879.


I. Purpose

Under section 706 of the SocialSecurity Act (the Act), the Secretary ofHealth and Human Services (theSecretary) appoints the Council every 4years. The Council examines issuesaffecting the Social Security Old-Age,Survivors, and Disability Insurance(OASDI) programs, as well as theMedicare program and impacts on theMedicaid program, which were createdunder the Act.

In addition, the Secretary has askedthe Council specifically to address thefollowing:

• Social Security financing issues,including developing recommendationsfor improving the long-range financialstatus of the OASDI programs;

• General program issues such as therelative equity and adequacy of SocialSecurity benefits for persons at variousincome levels, in various familysituations, and various age cohorts,taking into account such factors as the


increased labor force participation ofwomen, lower marriage rates, increasedlikelihood of divorce, and higherpoverty rates of aged women.

In addressing these topics, theSecretary suggested that the Councilmay wish to analyze the relative roles ofthe public and private sectors inproviding retirement income, howpolicies in both sectors affect retirementdecisions and the economic status of theelderly, and how the disabilityinsurance program provisions and theavailability of health insurance andhealth care costs affect such matters.

The Council is composed of 12members in addition to the chairman:Robert Ball, Joan Bok, Ann Combs,Edith Fierst, Gloria Johnson, ThomasJones, George Kourpias, SylvesterSchieber, Gerald Shea, Marc Twinney,Fidel Vargas, and Carolyn Weaver. Thechairman is Edward Gramlich.

The Council met previously on June24–25 (59 FR 30367), July 29, 1994 (59FR 35942), September 29–30 (59 FR47146), October 21–22 (59 FR 51451),November 18–19 (59 FR 55272), andJanuary 27 (60 FR 3416).

II. Agenda

The following topics will bepresented and discussed:

• Adequacy and Equity Options forthe Social Security Program;

• Discussion on Trust FundInvestment/Budget Treatment Options;and

• Trends in the relationship ofmorbidity and mortality.

The meeting is open to the public tothe extent that space is available.Interpreter services for persons withhearing impairments will be provided.A transcript of the meeting will beavailable to the public on an at-cost-ofduplication basis. The transcript can beordered from the Executive Director ofthe Council.

(Catalog of Federal Domestic AssistanceProgram Nos. 93.802, Social Security-Disability Insurance; 93.803, Social Security-Retirement Insurance; 93.805, SocialSecurity-Survivors Insurance.)


David C. Lindeman,Executive Director, 1994–95 Advisory Councilon Social Security.[FR Doc. 95–2041 Filed 1–26–95; 8:45 am]

BILLING CODE 4190–29–P

DEPARTMENT OF HOUSING ANDURBAN DEVELOPMENT

Office of the Assistant Secretary forCommunity Planning andDevelopment

[Docket No. N–95–1917; FR–3778–N–21]

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.EFFECTIVE DATES: January 27, 1995.ADDRESSES: For further information,contact William Molster, Department ofHousing and Urban Development, Room7254, 451 Seventh Street SW,Washington, DC 20410; telephone (202)708–1226; 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 the December 12, 1988court order in National Coalition for theHomeless v. Veterans Administration,No. 88–2503–OG (D.D.C.), HUDpublishes a Notice, on a weekly basis,identifying unutilized, underutilized,excess and surplus Federal buildingsand real property that HUD hasreviewed for suitability for use to assistthe homeless. Today’s Notice is for thepurpose of announcing that noadditional properties have beendetermined suitable or unsuitable thisweek.

Dated: January 20, 1995.Jacquie M. Lawing,Deputy Assistant Secretary for EconomicDevelopment.[FR Doc. 95–2076 Filed 1–26–95; 8:45 am]BILLING CODE 4210–29–M

[Docket No. N–95–3862; FR–3846–N–02]

Notice of Funding Availability forFiscal Year 1995 for Innovative ProjectFunding Under the InnovativeHomeless Initiatives DemonstrationProgram; Notice of Extension ofDeadline for Applications

AGENCY: Office of the AssistantSecretary for Community Planning andDevelopment, HUD.

ACTION: Notice of funding availability(NOFA); Extension of deadline forapplications.

SUMMARY: On January 25, 1995 (60 FR4996), the Department published in theFederal Register, a Notice thatannounced the availability of $25million in funds for applications forInnovative Project Funding under theInnovative Homeless InitiativesDemonstration Program. These fundswill be awarded competitively forinnovative programs designed toprovide aggressive outreach to homelesspersons living on the streets or in otherplaces not designed for, or ordinarilyused as, regular sleepingaccommodations for human beings;provide intensive needs assessments;connect these people with existingcommunity resources when available;and, if necessary, provide additionalhousing and services for them.

For reasons set forth in the January25, 1995 NOFA, and reiterated in thisnotice, there is a short applicationperiod for this funding. The January 25,1995 NOFA provided for an applicationdeadline of February 6, 1995. TheDepartment, however, had intended toprovide for an application deadline ofFebruary 13, 1995. Accordingly, thepurpose of this notice is to extend theapplication due date until 6 p.m. localtime on February 13, 1995. (See theJanuary 25, 1995 published NOFA forall additional requirements.)DEADLINE DATES: All applicationsreceived at HUD Headquarters, Office ofCommunity Planning and Development,at the address shown in the‘‘Addresses’’ section of this NOFA by 6p.m. local time on February 13, 1995will be considered for funding. HUDwill treat as ineligible for considerationapplications that are received after thedeadline. However, any applicationreceived at that address within 24 hoursafter the deadline will be considered forfunding if the applicant can show therewere circumstances beyond its controlthat delayed delivery of the application,such as the failure of a delivery serviceto deliver the application on or beforethe specified date. Applications may notbe sent by facsimile (FAX).

The Department has established ashort application period for this NOFAin an effort to make funding quicklyavailable to applicants who are in needof funding to assist homeless persons,especially during this time when harshweather conditions necessitate greaterand more immediate assistance tohomeless persons.ADDRESSES: A completed applicationmust be submitted to the followingaddress: Processing and Control Unit,


Room 7255, Office of CommunityPlanning and Development, Departmentof Housing and Urban Development,451 Seventh Street SW., Washington,DC 20410, Attention: HomelessInnovative Funding.

One copy of the application must alsobe sent to the HUD Field Office servingthe area in which the applicant’s projectis located. A list of Field Offices appearsin Appendix C to the NOFA, which waspublished on January 25, 1995. TheField Office copy must be received bythe application deadline as well, but adetermination that an application wasreceived on time will be made solely onreceipt of the application at the Officeof Community Planning andDevelopment in Headquarters,Washington, DC.FOR FURTHER INFORMATION CONTACT: TheHUD Field Office for the area in whichthe proposed project is located.Telephone numbers are included in thelist of Field Offices set forth inAppendix C to the NOFA, published onJanuary 25, 1995.SUPPLEMENTARY INFORMATION:Accordingly, the deadline date forreceipt of applications for the Notice ofFunding Availability for Fiscal Year1995 for Innovative Project Fundingunder the Innovative HomelessInitiatives Demonstration Program(NOFA), published in the FederalRegister on January 25, 1995 (60 FR4996), is extended to February 13, 1995.

Dated: January 25, 1995.Jacquie M. Lawing,Deputy Assistant Secretary for EconomicDevelopment.[FR Doc. 95–2220 Filed 1–25–95; 1:28 pm]BILLING CODE 4210–29–P

DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service

Notice of Availability of DraftConservation Agreement for the VirginSpinedace for Review and Comment

AGENCY: U.S. Fish and Wildlife Service,Interior.ACTION: Notice of document availability.

SUMMARY: The Fish and Wildlife Service(Service) announces the availability forpublic review of a Draft ConservationAgreement for the Virgin spinedace(Lepidomeda mollispinis mollispinis).This species is proposed for Federallisting as threatened pursuant to theEndangered Species Act (Act) of 1973,as amended. The ConservationAgreement was developed by the UtahDepartment of Natural Resources, with

participation from the followingparties—Bureau of Land Management,National Park Service, NevadaDepartment of Conservation and NaturalResources, Arizona Game and FishDepartment, Washington County WaterConservancy District, and the Service.The agreement focuses on reducing andeliminating significant threats andenhancing and/or stabilizing specificreaches of occupied and unoccupiedhistorical habitat of the Virginspinedace. The Service solicits reviewand comment from the public on thisdraft agreement.DATES: Comments on the DraftConservation Agreement must bereceived on or before March 28, 1995 tobe considered by the Service duringpreparation of the final conservationagreement and prior to the Service’sdetermination whether it will be asignatory party to the agreement.ADDRESSES: Persons wishing to reviewthe Draft Conservation Agreement mayobtain a copy by contacting the FieldSupervisor, U.S. Fish and WildlifeService, 145 East 1300 South, Suite 404,Salt Lake City, Utah 84115. Writtencomments and materials regarding theDraft Conservation Agreement shouldalso be directed to the same address.Comments and materials received willbe available on request for publicinspection, by appointment, duringnormal business hours at the aboveaddress.FOR FURTHER INFORMATION CONTACT:Mr. Roberts D. Williams, Assistant FieldSupervisor (see ADDRESSES section)(telephone 801/524–5001).


BackgroundThe Virgin spinedace is a small

minnow endemic to the Virgin Riverdrainage basin in southwestern Utah,northwestern Arizona, and southeasternNevada. Over the last 50 years, the rangeof the species has declined byapproximately 37–40 percent due tohuman impacts such as waterdevelopment projects, agriculture,mining, urbanization, and introductionof nonactive fishes. The Virginspinedace was proposed for listing as athreatened species on May 18, 1994 (59FR 25875). In May 1994 the UtahDepartment of Natural Resourcesinitiated development of a ConservationAgreement, working cooperatively withother agencies, in an effort to reduce thethreats affecting the Virgin spinedace.

The Conservation Agreement outlinesfive general management actions andfour general administrative actionsrequired to meet the objectives of theagreement. These actions include

reestablishing and maintaining requiredflows, enhancing and maintaininghabitat, selectively controllingnonnative fish, maintaining geneticviability, monitoring populations andhabitat, coordinating conservationactivities, implementing theconservation schedule, fundingconservation actions, and assessingconservation progress.

Public Comments SolicitedThe Service will use information

received in its determination as towhether it should be a signatory partyto the agreement. Comments orsuggestions from the public, otherconcerned governmental agencies, thescientific community, industry, or anyother interested party concerning thisdraft document are hereby solicited. Allcomments and materials received willbe considered prior to the approval ofany final document.

AuthorThe primary author of this notice is

Janet Mizzi (see ADDRESSES section)(telephone 801/524–5001).

AuthorityThe authority for this action is the

Endangered Species Act of 1973, asamended (16 U.S.C. 1531 et seq.), theFish and Wildlife Act of 1956, the Fishand Wildlife Service Coordination Actof 1964, and the National Memorandumof Understanding (94(SMU–058)).

Dated: January 23, 1995.Ralph O. Morgenweck,Regional Director.[FR Doc. 95–2080 Filed 1–26–95; 8:45 am]BILLING CODE 4310–55–M

INTERSTATE COMMERCECOMMISSION

Notice of Intent to Engage inCompensated Intercorporate HaulingOperations

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: American Brands, Inc.,1700 East Putnam Avenue, OldGreenwich, Connecticut 06870–0811.

2. Wholly-owned subsidiaries whichwill participate in the operations, andState(s) of incorporation:(I) ACCO World Corporation—Delaware(II) Polyblend Corporation—Illinois(III) Vogel Peterson Furniture

Company—Delaware


(IV) ACCO USA, Inc.—Delaware(V) Day-Timers, Inc.—Delaware(VI) Sax Arts and Crafts, Inc.—Delaware(VII) Kensington Microware Limited—

Delaware(VIII) MasterBrand Industries, Inc.—

Delaware(IX) Moen Incorporated—Delaware(X) 21st Century Companies, Inc.—

DelawareVernon A. Williams,Secretary.[FR Doc. 95–2067 Filed 1–26–95; 8:45 am]BILLING CODE 7035–01–M

[Docket No. AB–55 (Sub-No. 495X)]

CSX Transportation, Inc.—Abandonment and DiscontinuanceExemption—in Lawrence County, IN

CSX Transportation, Inc. (CSXT) fileda notice of exemption under 49 CFR1152 Subpart F—ExemptAbandonments to abandon its 6.7-mileline of railroad extending betweenmilepost Q–245.0, at Bedford, andmilepost Q–251.7, near Mitchell, inLawrence County, IN. A notice ofexemption was served and published inthe Federal Register on October 5, 1994(59 FR 50771).

CSXT certified that: (1) No localtraffic has moved over the line for atleast 2 years; (2) there is no CSXToverhead traffic on the line; (3) noformal complaint filed by a user of railservice on 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) the requirements at 49CFR 1105.7 (environmental reports), 49CFR 1105.8 (historic report), 49 CFR1105.11 (transmittal letter), 49 CFR1105.12 (newspaper publication), and49 CFR 1152.50(d)(1) (notice togovernmental agencies) have been met.

The Brotherhood of LocomotiveEngineers filed a request to revokeCSXT’s exemption on November 28,1994, alleging that the notice containedfalse or misleading information. CSXT’sverified notice of exemption wasproperly filed. However, the noticeserved and published on October 5,1994, contained a ministerial error andis amended by this new notice andFederal Register publication.

Because of trackage rights held by SooLine Railroad Company’s (SLR), CSXTmay only discontinue service at thistime. The effectiveness of this notice asto the abandonment will be contingentupon: (1) SLR’s obtaining Commission

approval or exemption to discontinueits trackage rights; and (2) CSXTinforming any party requesting publicuse or trail use if and when suchtrackage rights are discontinued. SeeMissouri Pac. R. Co.—Aban.—Osage &Morris Count. KS, 9 I.C.C.2d 1228(1993). Requests for public use or trailuse conditions will not be acted uponuntil SLR has relinquished its trackagerights.

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.

A copy of any pleading filed with theCommission should be sent toapplicant’s representative: Charles M.Rosenberger, 500 Water St., J150,Jacksonville, FL 32202.

If the notice of exemption containsfalse or misleading information, theexemption is void ab initio.

CSXT has filed an environmentalreport which addresses theabandonment’s effects, if any, on theenvironment and historic resources. TheSection of Environmental Analysis(SEA) issued an environmentalassessment (EA) on by October 13, 1994finding that abandonment of the linewill not significantly affect the qualityof the human environment. Interestedpersons may obtain a copy of the EA bywriting to SEA (Room 3219, InterstateCommerce Commission, Washington,DC 20423) or by calling Elaine Kaiser,Chief of SEA, at (202) 927–6248.

Environmental, historic preservation,public use, or trail use/rail bankingconditions will be imposed, whereappropriate, in a subsequent decision.

Decided: January 23, 1995.By the Commission, David M. Konschnik,

Director, Office of Proceedings.Vernon A. Williams,Secretary.[FR Doc. 95–2068 Filed 1–26–95; 8:45 am]BILLING CODE 7035–01–P

DEPARTMENT OF JUSTICE

[AAG/A Order No. 96–94]

Privacy Act of 1974 as Amended by theComputer Matching and PrivacyProtection Act of 1988

This notice is published in theFederal Register in accordance with therequirements of the Privacy Act, asamended by the Computer Matching

and Privacy Protection Act of 1988(CMPPA) (5 U.S.C. 552a(e)(12). TheImmigration and Naturalization Service(INS), Department of Justice (the sourceagency), is participating in computermatching programs with the District ofColumbia and agencies of five states (alldesignated as recipient agencies). Thesematching activities will permit therecipient agencies to confirm theimmigration status of alien applicantsfor, or recipients of, Federal benefitsassistance under the ‘‘Systematic AlienVerification for Entitlements (SAVE)’’program as required by the ImmigrationReform and Control Act (IRCA) of 1986(Pub. L. 99–603). Specifically, thematching activities will permit thefollowing eligibility determinations:

(1) The District of ColumbiaDepartment of Employment Services;the New York Department of Labor; andthe Texas Employment Commission willbe able to determine eligibility status forunemployment compensation.

(2) The California State Department ofSocial Services will be able to determineeligibility status for the Aid to Familieswith Dependent Children (AFDC)Program, and the Food Stamps Program.

(3) The Colorado Department of SocialServices will be able to determine theeligibility status for the MedicaidProgram, the AFDC Program, and theFood Stamps Program.

(4) The New Jersey Department ofLabor will be able to determineeligibility status for unemploymentcompensation.

(5) The California State Department ofHealth Services will be able todetermine eligibility status for theMedicaid Program.

Section 121(c) of IRCA amendssection 1137 of the Social Security Actand requires agencies which administerthe Federal benefit programs designatedwithin IRCA to use the INS verificationsystem to determine eligibility.Accordingly, through the use of useridentification codes and passwords,authorized persons from these agenciesmay electronically access the data baseof an INS system of records entitled‘‘Alien Status Verification Index,Justice/INS–009.’’ From its automatedrecords system, any agency (namedabove) participating in these matchingprograms may enter electronically intothe INS data base the alien registrationnumber of the applicant or recipient.This action will initiate a search of theINS data base for a corresponding alienregistration number. Where suchnumber is located, the agency willreceive electronically from the INS database the following data upon which todetermine eligibility: Alien registrationnumber; last name, first name; date of


birth; country of birth; social securitynumber (if available); date of entry;immigration status data; andemployment eligibility data. Inaccordance with 5 U.S.C. 552a(p), suchagencies will provide the alienapplicant with 30 days notice and anopportunity to contest any adversefinding before final action is takenagainst that alien because of ineligibleimmigration status as establishedthrough the computer match.

The original effective date of thematching programs was January 29,1990, for which notice was published inthe Federal Register on December 28,1989 (54 FR 53382). The programs havecontinued to date under the authority ofa series of new approvals as required bythe CMPPA. The CMPPA provides thatbased upon approval by agency DataIntegrity Boards of a new computermatching agreement, computermatching activities may be conductedfor 18 months and, contingent uponspecific conditions, may be similarlyextended by the Board for an additionalyear without the necessity of a newagreement. The most recent one-yearextension for those programs listed initems (1) through (3) above will expireon February 3, 1995, and those listed initems (4) and (5) above will expire onFebruary 6, 1995. Therefore, theDepartment’s Data Integrity Board hasapproved new agreements to permit thecontinuation of the above-namedcomputer matching programs foranother 18-month period from theeffective date (described below).

Matching activities under the newagreements will be effective (1) 30 daysafter publication of a computermatching notice in the Federal Register,or (2) 40 days after a report concerningthe computer matching programs hasbeen transmitted to the Office ofManagement and Budget andtransmitted to Congress along with acopy of the agreements, whichever islater. The agreements (and matchingactivities) will continue for 18 monthsfrom the effective date—unless within 3months prior to the expiration of theagreement, the Data Integrity Boardapproves a one-year extension pursuantto 5 U.S.C. 552a(o)(2)(D).

In accordance with 5 U.S.C.552a(o)(2)(A) and (r), the required reporthas been provided to the Office ofManagement and Budget, and to theCongress together with a copy of theagreements.

Inquiries may be addressed to PatriciaE. Neely, Staff Assistant, Systems PolicyStaff, Justice Management Division,Department of Justice, Washington, DC20530 (Room 850, WCTR Bldg.).


Stephen R. Colgate,Assistant Attorney General forAdministration.[FR Doc. 95–2025 Filed 1–26–95; 8:45 am]


Office of Juvenile Justice andDelinquency Prevention

[OJP (OJJDP) No. 1041]

Meeting of the Coordinating Councilon Juvenile Justice and DelinquencyPrevention

AGENCY: U.S. Department of Justice,Office of Juvenile Justice andDelinquency Prevention.

ACTION: Notice of meeting.

SUPPLEMENTARY INFORMATION: A meetingof the Coordinating Council on JuvenileJustice and Delinquency Prevention willtake place in the District of Columbia,beginning at 1:00 p.m. on Wednesday,February 8, 1995, and ending at 4:00p.m. on February 8, 1995. This advisorycommittee, chartered as theCoordinating Council on JuvenileJustice and Delinquency Prevention,will meet at the United StatesDepartment of Justice, located at 10thand Constitution Avenue, N.W.,Conference Room 5111, Washington,D.C. 20530. The Coordinating Council,established pursuant to section 3(2)(A)of the Federal Advisory Committee Act(5 U.S.C. App. 2), will meet to carry outits advisory functions under section 206of the Juvenile Justice and DelinquencyPrevention Act of 1974, as amended.This meeting will be open to the public.The public is advised that it must enterthe building via the ConstitutionAvenue Visitors’ Center. For securityreasons, members of the public who areattending the meeting must contact theOffice of Juvenile Justice andDelinquency Prevention (OJJDP) byclose of business February 1, 1995. Thepoint of contact at OJJDP is Lutricia Keywho can be reached at (202) 307–5911.The public is further advised that apictured identification is required toenter the building.Shay Bilchik,Administrator, Office of Juvenile Justice andDelinquency Prevention.[FR Doc. 95–2085 Filed 1–26–95; 8:45 am]

BILLING CODE 4410–18–P

DEPARTMENT OF LABOR

Employment StandardsAdministration, Wage and HourDivision

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 tobe 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 theminimum 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 cause is hereby found for notutilizing notice and public commentprocedure thereon prior to the issuanceof these determinations as prescribed in5 U.S.C. 553 and not providing for delayin the effective 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 used


in accordance with the provisions of 29CFR Parts 1 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 Determinations, 200 ConstitutionAvenue, NW., Room S–3014,Washington, DC 20210.

Modification to General WageDeterminations 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 parenteses following the decisionsbeing modified.

Volume I

None

Volume II

None

Volume III

None

Volume IV

None

Volume V

None

Volume VI

None

General Wage DeterminationPublication

General wage determinations issuedunder the Davis-Bacon and RelatedActs, including those noted above, maybe found in the Government PrintingOffice (GPO) document entitled

‘‘General Wage Determinations IssuedUnder The Davis-Bacon and RelatedActs’’. This publication is available ateach of the 50 Regional GovernmentDepository Libraries and many of the1,400 Government Depository Librariesacross the county. Subscriptions may bepurchased from: Superintendent ofDocuments, U.S. Government PrintingOffice, Washington, DC 20402, (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 six separate volumes,arranged by State. Subscriptions includean annual edition (issued in January orFebruary which included all currentgeneral wage determinations for theStates covered by each volume.Throughout the remainder of the year,regular weeekly updates will bedistributed to subscribers.

Signed at Washington, DC this 20th day ofJanuary 1995.Alan L. Moss,Director, Division of Wage Determination.[FR Doc. 95–1875 Filed 1–26–95; 8:45 am]BILLING CODE 4510–27–M

Employment and TrainingAdministration

[TA–W–30,339]

DG&E/Slocum Limited Partnership;Slocum, TX and TA–W–30,339A DallasGas & Electric, Inc. Dallas TX;Amended Certification RegardingEligibility To Apply for WorkerAdjustment Assistance

In accordance with Section 223 of theTrade Act of 1974 (19 USC 2273) theDepartment of Labor issued aCertification of Eligibility to apply forWorker Adjustment Assistance onDecember 12, 1994, applicable to allworkers of the subject firm. Thecertification notice will soon bepublished in the Federal Register.

At the request of the company, theDepartment reviewed the certificationfor workers of the subject firm. Thesales, production and employment datafor the Dallas, Texas office was includedwith the initial investigation;accordingly, the Dallas office met allthree of the Worker Group EligibilityRequirements of the Trade Act forcertification.

Therefore, the Department isamending the certification by includingthe Dallas, Texas location of Dallas Gas& Electric, Inc.

The amended notice applicable toTA–W–30,339 is hereby issued asfollows:

All workers of DG&E/Slocum LimitedPartnership, Slocum, Texas and the Dallas,Texas Office of Dallas Gas & Electric, Inc.,engaged in employment related to theproduction of crude oil who became totallyor partially separated from employment on orafter September 6, 1993 are eligible to applyfor adjustment assistance under Section 223of the Trade Act of 1974.

Signed at Washington, D.C. this 13th dayof January 1995.Victor J. Trunzo,Program Manager, Policy and ReemploymentServices, Office of Trade AdjustmentAssistance.[FR Doc. 95–2030 Filed 1–26–95; 8:45 am]BILLING CODE 4510–30–M

[TA–W–30,332]

Intera Information Technologies, Inc.,Denver, CO; Notice of AffirmativeDetermination Regarding Applicationfor Reconsideration

On November 15, 1994, one of thepetitioners requested administrativereconsideration of the Department ofLabor’s Notice of NegativeDetermination Regarding Eligibility toApply for Worker AdjustmentAssistance for workers at the subjectfirm. The Department’s NegativeDetermination was issued on November4, 1994 and published in the FederalRegister on November 16, 1994 (59 FR59252).

New findings show that Interaperformed exploration activities andconducted testings at the well site forunaffiliated firms in the oil industry.

ConclusionAfter careful review of the

application, I conclude that the claim isof sufficient weight to justifyreconsideration of the Department ofLabor’s prior decision. The applicationis, therefore, granted.

Signed at Washington, D.C., this 13th dayof January 1995.Victor J. Trunzo,Program Manager, Policy and ReemploymentServices, Office of Trade AdjustmentAssistance.[FR Doc. 95–2031 Filed 1–26–95; 8:45 am]BILLING CODE 4510–30–M

Investigations Regarding Certificationsof Eligibility To Apply for WorkerAdjustment Assistance

Petitions have been filed with theSecretary of Labor under Section 221(a)of the Trade Act of 1974 (‘‘the Act’’) andare identified in the Appendix to thisnotice. Upon receipt of these petitions,the Director of the Office of TradeAdjustment Assistance, Employment


and Training Administration, hasinstituted investigations pursuant toSection 221(a) of the Act.

The purpose of each of theinvestigations is to determine whetherthe workers are eligible to apply foradjustment assistance under Title II,Chapter 2, of the Act. The investigationswill further relate, as appropriate, to thedetermination of the date on which totalor partial separations began orthreatened to begin and the subdivisionof the firm involved.

The petitioners or any other personsshowing a substantial interest in thesubject matter of the investigations mayrequest a public hearing, provided suchrequest is filed in writing with theDirector, Office of Trade AdjustmentAssistance, at the address shown below,not later than February 6, 1995.

Interested persons are invited tosubmit written comments regarding thesubject matter of the investigations tothe Director, Office of Trade AdjustmentAssistance, at the address shown below,not later than February 6, 1995.

The petitions filed in this case areavailable for inspection at the Office ofthe Director, Office of Trade AdjustmentAssistance, Employment and TrainingAdministration, U.S. Department ofLabor, 200 Constitution Avenue, N.W.,Washington, D.C. 20210.

Signed at Washington, D.C. this 3rd day ofJanuary, 1995.

Victor J. Trunzo,Program Manager, Policy and ReemploymentServices, Office of Trade AdjustmentAssistance.

APPENDIX

Petitioner (union/workers/firm) Location Date re-ceived

Date ofpetition

PetitionNo. Articles produced

Kane Industries (Co) ....................... Morgantown, KY ............... 01/03/95 12/21/94 30,611 Men’s Formal Wear and TailoredCoats.

Bravo Fashions, Inc (ILGWU) ......... Wilkes Barre, PA .............. 01/03/95 12/22/94 30,612 Ladies’ suits.T.A.B.C Prince Gardner (Wkrs) ...... Searcy, AR ........................ 01/03/95 12/14/95 30,613 Leather Billfolds.Yocon Knitting (ACTWU) ................ Stowe, PA ......................... 01/03/95 12/22/94 30,614 T-Shirts and Turtlenecks.Colonial Shoe, Inc (Wkrs) ............... Littlestown, PA .................. 01/03/95 12/20/94 30,615 Shoes, Dress, Work, Casual.Colonial Shoe, Inc (Wkrs) ............... Salunga, PA ...................... 01/03/95 12/20/94 30,616 Shoes, Dress, Work, Casual.Shaw Pipe, Inc (Wkrs) .................... Highspire, PA .................... 01/03/95 01/03/95 30,617 Small Steel Pipes.Electra Sound, Inc (Wkrs) ............... Parma, OH ........................ 01/03/95 12/20/94 30,618 Automobile Engine Control Mod-

ules.WARNACO, Inc (Wkrs) ................... Long Island City, NY ......... 01/03/95 12/23/94 30,619 Neckties.Woodward Governor Co-Stevens

Point (Co).Stevens Point, WI ............. 01/03/95 12/22/94 30,620 Fuel Control Parts—Aircraft En-

gines.TRW Transportation (Wkrs) ............ San Dimas, CA ................. 01/03/95 12/21/94 30,621 Safety Airbags Sensors.E.L. Heacock Co., Inc (Wkrs) ......... Gloversville, NY ................ 01/03/95 12/20/94 30,622 Leather Goods.Marilene Fashions, Inc (ILGWU) .... Jersey City, NJ ................. 01/03/95 12/16/94 30,623 Ladies’ Coats and Suits.Orbital Science Corp. (Wkr) ............ Pomona, CA ..................... 01/03/95 12/20/94 30,624 Cameras—Space Station.Alascom, Inc (IBT) .......................... Anchorage, AK .................. 01/03/95 11/17/94 30,625 Telecommunications.A–Tek (Co) ...................................... Brainerd, MN ..................... 01/03/95 12/21/94 30,626 Video Cassette Sub-Assemblies.New Dimensions Ltd/Rosecraft

(Wkrs).Providence, RI .................. 01/03/95 12/21/94 30,627 Costume Jewelry.

Artex Manufacturing Co., Inc (Wkrs) Abilene, KS ....................... 01/03/95 12/20/94 30,628 Athletic Wear.Artex Manufacturing Co., Inc (Wkrs) Overland Park, KS ............ 01/03/95 12/20/94 30,629 Athletic Wear.Artex Manufacturing Co., Inc (Wkrs) Boonville, MO ................... 01/03/95 12/20/94 30,630 Athletic Wear.


[TA–W–30,180]

Magnetek, Huntington, IN; Notice ofRevised Determination onReconsideration

On December 16, 1994, theDepartment issued an AffirmativeDetermination Regarding Applicationfor Reconsideration for workers andformer workers of the subject firm. Thenotice was published in the FederalRegister on December 30, 1994 (59 FR67735).

The initial investigation findingsshow that the workers producingmagnetic components met all theworker group eligibility requirementsfor certification but the workersproducing electronic ballasts did notmeet criterion 3 (increased imports) of

the worker group eligibilityrequirements.

New findings on reconsiderationshow production of electronic ballastsceased at Huntington, Indiana inAugust, 1994 when substantial workerseparations occurred. Other findings onreconsideration show increasedcorporate imports of electronic ballastsfrom Mexico in 1994.

Conclusion

After careful consideration of the newfacts obtained on reconsideration, it isconcluded that workers and formerworkers of MagneTek in Huntington,Indiana were adversely affected byincreased imports of articles that arelike or directly competitive withmagnetic components and electronicballasts produced at the subject plant. Inaccordance with the provisions of theAct, I make the following reviseddetermination for workers of MagneTekin Huntington, Indiana.

‘‘All workers of MagneTek in Huntington,Indiana who became totally or partiallyseparated from employment on or after July26, 1993 are eligible to apply for adjustmentassistance under Section 223 of the Trade Actof 1974.’’

Signed at Washington, D.C., this 11th dayof January, 1995.Victor J. Trunzo,Program Director, Policy and ReemploymentServices, Office of Trade AdjustmentAssistance.[FR Doc. 95–2033 Filed 1–26–95; 8:45 am]BILLING CODE 4510–30–M

Investigations Regarding Certificationsof Eligibility To Apply for WorkerAdjustment Assistance

Petitions have been filed with theSecretary of Labor under Section 221 (a)of the Trade Act of 1974 (‘‘the Act’’) andare identified in the Appendix to thisnotice. Upon receipt of these petitions,the Director of the Office of Trade


Adjustment Assistance, Employmentand Training Administration, hasinstituted investigations pursuant toSection 221(a) of the Act.

The purpose of each of theinvestigations is to determine whetherthe workers are eligible to apply foradjustment assistance under Title II,Chapter 2, of the Act. The investigationswill further relate, as appropriate, to thedetermination of the date on which totalor partial separations began orthreatened to begin and the subdivisionof the firm involved.

The petitioners or any other personsshowing a substantial interest in thesubject matter of the investigations mayrequest a public hearing, provided suchrequest is filed in writing with theDirector, Office of Trade AdjustmentAssistance, at the address shown below,not later than February 6, 1995.

Interested persons are invited tosubmit written comments regarding thesubject matter of the investigations tothe Director, Office of Trade AdjustmentAssistance, at the address shown below,not later than February 6, 1995.

The petitions filed in this case areavailable for inspection at the Office ofthe Director, Office of Trade AdjustmentAssistance, Employment and TrainingAdministration, U.S. Department ofLabor, 200 Constitution Avenue, NW.,Washington, DC 20210.

Signed at Washington, D.C. this 9th day ofJanuary, 1995.

Victor J. Trunzo,Program Manager, Policy & ReemploymentServices, Office of Trade AdjustmentAssistance.

Petitioner (union/workers/firm) Location Datereceived

Date ofpetition

PetitionNo. Articles produced

Melnor, Inc (Co) ..................................... Moonachie, NJ ....... 01/09/95 12/21/94 30,631 Assembly of lawn & garden products.IRM Co (Wkrs) ....................................... Port Arthur, TX ....... 01/09/95 12/28/94 30,632 Maintenance/service.Karlshamns USA, Inc (ICWU) ............... Kearny, NJ ............. 01/09/95 12/21/94 30,633 Specialty fat to food industries.Illinois Masonic Hospital (Wkrs) ............ Chicago, IL ............. 01/09/95 12/22/94 30,634 Food service.Genicom Corp (Wkrs) ............................ Waynesboro, VA .... 01/09/95 12/21/94 30,635 Printers and relays.Goebel Miniatures (Wkrs) ...................... Camarillo, CA ......... 01/09/95 12/31/94 30,636 Collectible figurines.Moonlight Mushrooms, Inc (USWA) ...... Worthington, PA ..... 01/09/95 11/17/94 30,637 Mushrooms.MPI Warehouse Speciality Co (Co) ...... Williston, ND .......... 01/09/95 12/19/94 30,638 Warehouses goods for oil & gas.Exxon Pipeline Co (Wkrs) ..................... La Porte, TX ........... 01/09/95 12/30/94 30,639 Crude oil.Hanel Lumber Co (Wkrs) ...................... Hood River, OR ..... 01/09/95 12/29/94 30,640 Logs.Champ Serve Line (UAW) ..................... Edwardsville, KS .... 01/09/95 12/19/94 30,641 Automotive parts & accessories.Malco Microdot (Wkrs) .......................... Montgomeryvile, PA 01/09/95 12/29/94 30,642 Electronic parts, auto parts.

[FR Doc. 95–2036 Filed 1–26–95; 8:45 am]


[TA–W–30,578]

McKay Drilling Company Aroura, CO;Operating at Other Sites in theFollowing States: TA–W–30, 578ANorth Dakota TA–W–30, 578BWyoming; Notice of Termination ofInvestigation

Pursuant to Section 221 of the TradeAct of 1974, an investigation wasinitiated on December 19, 1994 inresponse to a worker petition which wasfiled on December 1, 1994 on behalf ofworkers at Mckay Drilling Company,Incorporated, Aroura, Colorado (TA–W–30,578) and operating out of thefollowing states: North Dakota (TA–W–30,578A) and Wyoming (TA–W–30,578B).

All workers were separated from thesubject firm more than one year prior tothe date of the petition. Section 223 ofthe Act specifies that no certificationmay apply to any worker whose lastseparation occurred more than one yearbefore the date of the petition.Consequently, further investigation inthis case would serve no purpose, andthe investigation has been terminated.

Signed in Washington, DC this 13th day ofJanuary 1995.Victor J. Trunzo,Program Manager, Policy and ReemploymentServices, Office of Trade AdjustmentAssistance.[FR Doc. 95–2034 Filed 1–26–95; 8:45 am]BILLING CODE 4510–30–M

[TA–W–30,310 Syracuse, New York][TA–W–30,310A All Other Sites in New York]

Niagara Mohawk Power Corp.;Amended Certification RegardingEligibility To Apply for WorkerAdjustment Assistance

In accordance with Section 223 of theTrade Act of 1974 (19 USC 2273) theDepartment of Labor issued aCertification of Eligibility to Apply forWorker Adjustment Assistance onNovember 10, 1994, applicable to allworkers of the subject firm. Thecertification was published in theFederal Register on December 9, 1994(59 FR 63823).

At the request of the State Agency, theDepartment reviewed the certificationfor workers of the subject firm. Newfindings show that worker separationsoccurred at other locations in the state.

Accordingly, the Department isamending the certification to properlyreflect the correct worker group.

The intent of the Department’scertification is to include all workers ofNiagara Mohawk Power Corporation

who were adversely affected byincreased imports of electricity.

The amended notice applicable toTA–W–30,310 is hereby issued asfollows:

‘‘All workers of Niagara Mohawk PowerCorporation Syracuse, New York and at otherlocations in the state of New York whobecame totally or partially separated fromemployment on or After August 29, 1993 areeligible to apply for adjustment assistanceunder Section 223 of the Trade Act of 1974.’’

Signed at Washington, DC, this 11th Day ofJanuary, 1995.Victoria J. Trunzo,Progam Manager, Policy and ReemploymentServices, Office of Trade AdjustmentAssistance.[FR Doc. 95–2037 Filed 1–26–95; 8:45 am]BILLING CODE 4610–30–M

[TA–W–30,362]

Phillips-Van Heusen Warehouse &Distribution Center, West Hazleton,PA; Dismissal of Application forReconsideration

Pursuant to 29 CFR 90.18 anapplication for administrativereconsideration was filed with theDirector of the Office of TradeAdjustment Assistance for workers atPhillips-Van Heusen Warehouse &Distribution Center, West Hazleton,Pennsylvania. The review indicated thatthe application contained no newsubstantial information which would


bear importantly on the Department’sdetermination. Therefore, dismissal ofthe application was issued.TA–W–30,362; Phillips-Van Heusen

Warehouse & Distribution Center, WestHazleton, PA (January 12, 1995)

Signed at Washington, D.C. this 18th dayof January, 1995.Victor J. Trunzo,Program Manager, Policy & ReemploymentServices, Office of Trade AdjustmentAssistance.[FR Doc. 95–2038 Filed 1–26–95; 8:45 am]BILLING CODE 4510–30–M

[TA–W–30,493]

Texaco Exploration and Production,Incorporated Denver Division, Denver,CO; Notice of Termination ofInvestigation

Pursuant to section 221 of the TradeAct of 1974, an investigation wasinitiated on November 14, 1994 inresponse to a worker petition which wasfiled on behalf of workers and formerworkers at the Denver Division ofTexaco Exploration and Production,Incorporated, Denver, Colorado (TA–W–30,493).

The company has requested that thepetition be withdrawn. Consequently,further investigation in this case wouldserve no purpose, and the investigationhas been terminated.

Signed at Washington, D.C. this 12th dayof January 1995.Victor J. Trunzo,Program Manager, Policy and ReemploymentServices, Office of Trade AdjustmentAssistance.[FR Doc. 95–2039 Filed 1–26–95; 8:45 am]BILLING CODE 4510–30–M

NUCLEAR REGULATORYCOMMISSION

U.S. Enrichment Corporation’sGaseous Diffusion PlantsEstablishment of Local PublicDocument Rooms

The Nuclear Regulatory Commission(NRC) has established a local publicdocument room (LPDR) for each of theU.S. Enrichment Corporation’s (USEC)Paducah and Portsmouth gaseousdiffusion plants located in Paducah,Kentucky, and Piketon, Ohio,respectively.

Members of the public may nowinspect and copy documents andcorrespondence related to the Paducahand Portsmouth Plants at the followinglocations:

1. USEC Paducah Plant: PaducahPublic Library, 555 Washington Street,

Paducah, Kentucky 42003. Hours ofoperation: Monday through Thursday9:00 a.m. to 9:00 p.m.; Friday andSaturday 9:00 a.m. to 6:00 p.m.; andSunday 1:00 p.m. to 6:00 p.m. Contact:Ms. Marie Liang, Assistant Director,telephone number (502) 442–2510.

2. USEC Portsmouth Plant:Portsmouth Public Library, 1220 GalliaStreet, Portsmouth, Ohio 45662. Hoursof operation: Monday through Friday9:00 a.m. to 8:00 p.m.; Saturday 9:00a.m. to 5:30 p.m.; and Sunday 1:00 p.m.to 5:00 p.m. Contact: Mr. Charles T.Cook, Director, telephone number (614)354–5688.

Interested parties may visit or contacteither of the LPDRs directly or mayaddress their requests for records to theNRC’s Public Document Room, 2120 LStreet NW., Washington, DC 20555, ortelephone (202) 634–3273.

Questions concerning the NRC’s localpublic document room program or theavailability of documents should beaddressed to Ms. Jona L. Souder, LPDRProgram Manager, Freedom ofInformation/Local Public DocumentRoom Branch, U.S. Nuclear RegulatoryCommission, Washington, DC 20555–0001, telephone number (301) 415–7170, or toll-free 1–800–638–8081.

Dated at Rockville, Maryland, this 24th dayof January, 1995.

For the Nuclear Regulatory Commission.Carlton C. Kammerer,Director, Division of Freedom of Informationand Publications Services, Office ofAdministration.[FR Doc. 95–2078 Filed 1–26–95; 8:45 am]BILLING CODE 7590–01–M

[Docket No. 50–382]

Entergy Operations, Inc; Notice ofConsideration of Issuance ofAmendment to Facility OperatingLicense, Proposed No SignificantHazards Consideration Determination,and Opportunity for a Hearing

The U.S. Nuclear RegulatoryCommission (the Commission) isconsidering issuance of an amendmentto Facility Operating License No. NPF–38 issued to Entergy Operations, Inc.(the licensee), for operation of theWaterford Steam Electric Station, Unit3, located in St. Charles Parish,Louisiana.

The proposed amendment wouldmodify the technical specifications(TSs) by adding a new TS 3.0.5, and theassociated Bases. The new TS 3.0.5 willallow the equipment removed fromservice or declared inoperable tocomply with ACTIONS to be returned toservice under administrative controls

solely to perform testing required todemonstrate its OPERABILITY or theOPERABILITY of other equipment. Thisproposed change is based on theCombustion Engineering improvedstandard TSs approved by the NRC.

Before issuance of the proposedlicense amendment, the Commissionwill have made findings required by theAtomic Energy Act of 1954, as amended(the Act) and the Commission’sregulations.

The Commission has made aproposed determination that theamendment request involves nosignificant hazards consideration. Underthe Commission’s regulations in 10 CFR50.92, this means that operation of thefacility in accordance with the proposedamendment would not (1) involve asignificant increase in the probability orconsequences of an accident previouslyevaluated; or (2) create the possibility ofa new or different kind of accident fromany accident previously evaluated; or(3) involved a significant reduction in amargin of safety. As required by 10 CFR50.91(a), the licensee has provided itsanalysis of the issue of no significanthazards consideration, which ispresented below:

The proposed change will allow an orderlyreturn to service of inoperable equipment.Specification 3.0.5 will permit equipmentremoved from service to comply withrequired Actions to be returned to serviceunder administrative controls to verify theoperability of the equipment being returnedto service or operability of other equipment.The administrative controls will ensure thetime involved will be limited to only the timerequired to demonstrate the component orsystem operability. This new specificationprovides an acceptable method ofdemonstrating the operability of TSequipment before it is returned to service andallows for verifying other TS equipment isoperable. Therefore, the proposed changewill not involve a significant increase in theprobability or consequences of any accidentpreviously evaluated.

The proposed change will not alter theoperation of the plant or the manner inwhich the plant is operated. The equipmentis only being tested in its designconfiguration or being returned to service toallow testing of another component orsystem. Therefore, the proposed change willnot create the possibility of a new or differentkind of accident from any accidentpreviously evaluated.

The proposed Specification will only allowthe return to service of equipment that isexpected to fulfill its safety function. The useof Specification 3.0.5 will be limited to theperformance of testing on the equipmentbeing returned to service or on otherequipment that is dependent on theequipment being returned to service. Thetesting is limited to post maintenance testingand testing to prove operability. Therefore,the proposed change will not involve asignificant reduction in a margin of safety.


The NRC staff has reviewed thelicensee’s analysis and, based on thisreview, it appears that the threestandards of 10 CFR 50.92(c) aresatisfied. Therefore, the NRC staffproposes to determine that theamendment request involves nosignificant hazards consideration.

The Commission is seeking publiccomments on this proposeddetermination. Any comments receivedwithin 30 days after the date ofpublication of this notice will beconsidered in making any finaldetermination.

Normally, the Commission will notissue the amendment until theexpiration of the 30-day notice period.However, should circumstances changeduring the notice period such thatfailure to act in a timely way wouldresult, for example, in derating orshutdown of the facility, theCommission may issue the licenseamendment before the expiration of the30-day notice period, provided that itsfinal determination is that theamendment involves no significanthazards consideration. The finaldetermination will consider all publicand State comments received. Shouldthe Commission take this action, it willpublish in the Federal Register a noticeof issuance and provide for opportunityfor a hearing after issuance. TheCommission expects that the need totake this action will occur veryinfrequently.

Written comments may be submittedby mail to the Rules Review andDirectives Branch, Division of Freedomof Information and PublicationsServices, Office of Administration, U.S.Nuclear Regulatory Commission,Washington, DC 20555, and should citethe publication date and page number ofthis Federal Register notice. Writtencomments may also be delivered toRoom 6D22, Two White Flint North,11545 Rockville Pike, Rockville,Maryland, from 7:30 a.m. to 4:15 p.m.Federal workdays. Copies of writtencomments received may be examined atthe NRC Public Document Room, theGelman Building, 2120 L Street, NW.,Washington, DC.

The filing of requests for hearing andpetitions for leave to intervene isdiscussed below.

By February 27, 1995, the licenseemay file a request for a hearing withrespect to issuance of the amendment tothe subject facility operating license andany person whose interest may beaffected by this proceeding and whowishes to participate as a party in theproceeding must file a written requestfor a hearing and a petition for leave tointervene. Requests for a hearing and a

petition for leave to intervene shall befiled in accordance with theCommission’s ‘‘Rules of Practice forDomestic Licensing Proceedings’’ in 10CFR Part 2. Interested persons shouldconsult a current copy of 10 CFR 2.714which is available at the Commission’sPublic Document Room, the GelmanBuilding, 2120 L Street, NW.,Washington, DC, and at the local publicdocument room located at theUniversity of New Orleans Library,Louisiana Collection, Lakefront, NewOrleans, Louisiana 70122. If a requestfor a hearing or petition for leave tointervene is filed by the above date, theCommission or an Atomic Safety andLicensing Board, designated by theCommission or by the Chairman of theAtomic Safety and Licensing BoardPanel, will rule on the request and/orpetition; and the Secretary or thedesignated Atomic Safety and LicensingBoard will issue a notice of hearing oran appropriate order.

As required by 10 CFR 2.714, apetition for leave to intervene shall setforth with particularity the interest ofthe petitioner in the proceeding, andhow that interest may be affected by theresults of the proceeding. The petitionshould specifically explain the reasonswhy intervention should be permittedwith particular reference to thefollowing factors: (1) the nature of thepetitioner’s right under the Act to bemade party to the proceeding; (2) thenature and extent of the petitioner’sproperty, financial, or other interest inthe proceeding; and (3) the possibleeffect of any order which may beentered in the proceeding on thepetitioner’s interest. The petition shouldalso identify the specific aspect(s) of thesubject matter of the proceeding as towhich petitioner wishes to intervene.Any person who has filed a petition forleave to intervene or who has beenadmitted as a party may amend thepetition without requesting leave of theBoard up to 15 days prior to the firstprehearing conference scheduled in theproceeding, but such an amendedpetition must satisfy the specificityrequirements described above.

Not later than 15 days prior to the firstprehearing conference scheduled in theproceeding, a petitioner shall file asupplement to the petition to intervenewhich must include a list of thecontentions which are sought to belitigated in the matter. Each contentionmust consist of a specific statement ofthe issue of law or fact to be raised orcontroverted. In addition, the petitionershall provide a brief explanation of thebases of the contention and a concisestatement of the alleged facts or expertopinion which support the contention at

the hearing. The petitioner must alsoprovide references to those specificsources and documents of which thepetitioner is aware and on which thepetitioner intends to rely to establishthose facts or expert opinion. Petitionermust provide sufficient information toshow that a genuine dispute exists withthe applicant on a material issue of lawor fact. Contentions shall be limited tomatters within the scope of theamendment under consideration. Thecontention must be one which, ifproven, would entitle the petitioner torelief. A petitioner who fails to file sucha supplement which satisfies theserequirements with respect to at least onecontention will not be permitted toparticipate as a party.

Those permitted to intervene becomeparties to the proceeding, subject to anylimitations in the order granting leave tointervene, and have the opportunity toparticipate fully in the conduct of thehearing, including the opportunity topresent evidence and cross-examinewitnesses.

If a hearing is requested, theCommission will make a finaldetermination on the issue of nosignificant hazards consideration. Thefinal determination will serve to decidewhen the hearing is held.

If the final determination is that theamendment request involves nosignificant hazards consideration, theCommission may issue the amendmentand make it immediately effective,notwithstanding the request for ahearing. Any hearing held would takeplace after issuance of the amendment.

If the final determination is that theamendment request involves asignificant hazards consideration, anyhearing held would take place beforethe issuance of any amendment.

A request for a hearing or a petitionfor leave to intervene must be filed withthe Secretary of the Commission, U.S.Nuclear Regulatory Commission,Washington, DC 20555, Attention:Docketing and Services Branch, or maybe delivered to the Commission’s PublicDocument Room, the Gelman Building,2120 L Street NW., Washington, DC, bythe above date. Where petitions are filedduring the last 10 days of the noticeperiod, it is requested that the petitionerpromptly so inform the Commission bya toll-free telephone call to WesternUnion at 1–(800) 248–5100 (in Missouri1–(800) 342–6700). The Western Unionoperator should be given DatagramIdentification Number N1023 and thefollowing message addressed to WilliamD. Beckner: petitioner’s name andtelephone number, date petition wasmailed, plant name, and publicationdata and page number of this Federal


1 15 U.S.C. § 78s(b)(1) (1988).

2 For a complete description of DTC’s branchreceive program, refer to Securities Exchange ActRelease No. 34600 (August 25, 1994), 59 FR 45317[File No. SR–DTC–94–05] (order approving aproposed rule change establishing a service for therouting of securities certificates and relateddocumentation to DTC).

3 For a detailed description of the Lost and StolenSecurities Program, refer to Securities Exchange ActRelease No. 13832 (August 12, 1977), 42 FR 41022(implementation of program for reporting andinquiring with respect to missing, lost, counterfeitor stolen securities).

4 15 U.S.C. § 78q–1(b)(3)(A) (1988).5 17 CFR 240.17f–1(a) (1994).

Register notice. A copy of the petitionshould also be sent to the Office of theGeneral Counsel, U.S. NuclearRegulatory Commission, Washington,DC 20555, and to N. S. Reynolds, Esq.,Winston & Strawan, 1400 L Street, NW.,Washington DC 20005–3502, attorneyfor the licensee.

Nontimely filings of petitions forleave to intervene, amended petitions,supplemental petitions and/or requestsfor hearing will not be entertainedabsent a determination by theCommission, the presiding officer or thepresiding Atomic Safety and LicensingBoard that the petition and/or requestshould be granted based upon abalancing of the factors specified in 10CFR 2.714(a)(1)(i)–(v) and 2.714(d).

For further details with respect to thisaction, see the application foramendment dated January 19, 1995,which is available for public inspectionat the Commission’s Public DocumentRoom, the Gelman Building, 2120 LStreet, NW., Washington, DC, and at thelocal public document room located atthe University of New Orleans Library,Louisiana Collection, Lakefront, NewOrleans, Louisiana 70122.

Dated at Rockville, Maryland, this 23rd dayof January 1995.For the Nuclear Regulatory Commission.Chandu P. Patgel,Project Manager, Project Directorate IV–I,Division of Reactor Projects III/IV, Office ofNuclear Reactor Regulation.[FR Doc. 95–2079 Filed 1–26–95; 8:45 am]BILLING CODE 7590–01–M

SECURITIES AND EXCHANGECOMMISSION

[Release No. 34–35255; File No. SR–DTC–94–17]

Self-Regulatory Organizations; TheDepository Trust Company; Notice ofFiling and Immediate Effectiveness ofa Proposed Rule Change Relating toParticipation in the Lost and StolenSecurities Program

January 20, 1995.Pursuant to Section 19(b)(1) of the

Securities Exchange Act of 1934(‘‘Act’’),1 notice is hereby given that onDecember 13, 1994, The DepositoryTrust Company (‘‘DTC’’) filed with theSecurities and Exchange Commission(‘‘Commission’’) the proposed rulechange as described in Items I, II, andIII below, which items have beenprepared primarily by DTC. TheCommission is publishing this notice to

solicit comments on the proposed rulechange from interested persons.

I. Self-Regulatory Organization’sStatement of the Terms of Substance ofthe Proposed Rule Change

DTC proposes to participate in theSecurities and Exchange Commission’sLost and Stolen Securities Program as adirect inquirer on behalf of DTCparticipants that use DTC’s branchreceive service.2

II. Self-Regulatory Organization’sStatement of the Purpose of, andStatutory Basis for, the Proposed RuleChange

In its filing with the Commission,DTC included statements concerningthe purpose of and basis for theproposed rule change and discussed anycomments it has received on theproposed rule change. The text of thesestatements may be examined at theplaces specified in Item IV below. DTChas prepared 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

The purpose of the proposed rulechange is to allow DTC to participate inthe Lost and Stolen Securities Programas a direct inquirer on behalf ofinquirers using DTC’s branch receiveservice (DTC Inquirers). When anappropriate securities certificate comesinto DTC’s possession, DTC, acting onbehalf of a DTC Inquirer, will make aninquiry to the Commission’s designeeon behalf of the DTC Inquirer todetermine whether the certificate wasreported lost, missing, counterfeit, orstolen. When DTC is notified that theinquiry matches a missing, lost,counterfeit, or stolen security report,DTC will provide the DTC Inquirer withwhatever related information theCommission’s designee provides toDTC. In addition, DTC will make, asappropriate, reports to theCommission’s designee on behalf ofDTC Inquirers.

Currently, DTC participates in theLost and Stolen Securities Program bymaking inquiries and reports on its ownbehalf. The Commission contemplatedthat the Lost and Stolen Securities

Program would allow the proposedstructure of one reporting institutionassuming the inquiry responsibility ofother reporting institutions.3

DTC proposes to maintain andpreserve in an easily accessible place fora minimum of three years copies of allForms X–17F–1A filed by DTC onbehalf of DTC Inquirers, all agreementswith DTC Inquirers regardingregistration or other aspects of the Lostand Stolen Securities Program, and allconfirmations and other informationreceived from the Commission or itsdesignee as a result of inquiry.

Section 17A(b)(3)(A) of the Act 4

requires that a clearing agency bedesigned to facilitate the prompt andaccurate clearance and settlement ofsecurities transactions. DTC believesthat allowing it to act as Direct Inquireris consistent with Section 17A(b)(3)(A)in that it enables DTC to use itsautomated systems to makecommunications with the Commission’sdesignee faster and more accurate thansuch communications otherwise mightbe made. Allowing DTC to act as DirectInquirer will allow participants in thebranch receive program that may nothave a sufficient volume of securitiestransactions to otherwise justify theexpense of participating as directinquirers to participate as inquirers.Also, according to DTC, the rule changewill permit the Commission tocapitalize on the natural synergy ofallowing DTC, a registered clearingagency, to act as a Direct Inquirer onbehalf of participants using DTC’sbranch receive program. Theseparticipants are by virtue of their statusas clearing agency participantsautomatically ‘‘reporting institutions’’under Rule 17f–(1) of the Act 5 and thusare required to register with theCommission’s designee unless anexemption is available.

The proposed rule change will allowDTC to assist institutions and the publicin tracking and deterring trafficking inlost, stolen, missing, and counterfeitsecurities thereby bolstering theeffectiveness of the Lost and StolenSecurities Program and reducing therisk of financial losses that otherwisemight occur. This promotes efficiency inthe clearance and settlement ofsecurities transactions and is consistentwith Section 17A(b)(3)(A) of the Act.


6 15 U.S.C. 78s(b)(3)(A)(iii) (1988).7 17 CFR 240.19b–4(e)(4) (1994).

8 17 CFR 200.30–3(a)(12) (1994).1 15 U.S.C. § 78s(b)(1) (1988).

2 Securities Exchange Act Release No. 33023(October 6, 1993), 58 FR 52891.

3 Securities Exchange Act Release No. 34952(November 9, 1994), 59 FR 59137.

B. Self-Regulatory Organization’sStatement on Burden on Competition

DTC does not believe that theproposed rule change will have animpact or impose a burden oncompetition.

C. Self-Regulatory Organization’sStatement on Comments on theProposed Rule Change Received FromMembers, Participants or Others

DTC has not solicited or receivedcomments on the proposed rule change.

III. Date of Effectiveness of theProposed Rule Change and Timing forCommission Action

The foregoing rule change has becomeeffective pursuant to Section19(b)(3)(A)(iii) 6 of the Act and pursuantto Rule 19b–4(e)(4) 7 promulgatedthereunder because the proposalconstitutes a change in an existingservice of a registered clearing agencythat does not adversely affect thesafeguarding of securities or funds inthe custody or control of the clearingagency or for which it is responsible anddoes not significantly affect therespective rights or obligations of theclearing agency or persons using theservice. At any time within sixty daysof the filing of such rule change, theCommission may summarily abrogatesuch rule change if it appears to theCommission that such action isnecessary or appropriate in the publicinterest, for the protection of investors,or otherwise in furtherance of thepurposes of the Act.

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, D.C. 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, D.C. 20549. Copies of suchfiling will also be available forinspection and copying at the principal

office of DTC. All submissions shouldrefer to file No. SR–DTC–94–17 andshould be submitted by February 17,1995.

For the Commission by the Division ofMarket Regulation, pursuant to delegatedauthority.8

Jonathan G. Katz,Secretary.[FR Doc. 95–2070 Filed 1–26–95; 8:45 am]BILLING CODE 8010–01–M

[Release No. 34–35256; File No. SR–MCC–94–16]

Self-Regulatory Organizations;Midwest Clearing Corporation; Noticeof Filing of Proposed Rule ChangeRelating to Implementation of a Three-Day Settlement Standard


Securities Exchange Act of 1934(‘‘Act’’),1 notice is hereby given that onDecember 28, 1994, the MidwestClearing Corporation (‘‘MCC’’) filedwith the Securities and ExchangeCommission (‘‘Commission’’) aproposed rule change as described inItems I, II, and III below, which itemshave been prepared primarily by MCC.The Commission is publishing thisnotice to solicit comments on theproposed rule change from interestedpersons.


MCC proposed to modify its rules toimplement a three business daysettlement standard for securitiestransactions.


In its filing with the Commission,MCC 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. MCC has preparedsummaries, set forth in sections (A), (B),and (C) below, of the most significantaspects of such statements.


On October 6, 1993, the Commissionadopted Rule 15c6–1 under the Act

which establishes three business daysafter the trade date (‘‘T+3’’) instead offive business days (‘‘T+5’’) as thestandard settlement cycle for mostsecurities transactions.2 The rule willbecome effective June 7, 1995.3

The proposed rule change will amendInterpretations and Policies .01 of Rule2 of Article II of MCC’s rules to shortenthe time frame in which contract data ofcomparison data must be submitted toMCC to ensure that MCC has sufficienttime to review such contracts andreceive the necessary protection toguarantee the performance of suchcontract to the contra-broker in a T+3environment. Under suchinterpretations, MCC reserves the rightto cause such contract to be settledunder the trade-by-trade system or toreverse the trade in the continuous netsettlement system (1) if a regular waycontract is not recorded by MCC in aparticipant’s account until T+4, (2) if aregular way contract is not submitted byanother clearing corporation forrecordation in a participant’s accountuntil T+4, or (3) if the contract is to besettled through the participant’s accountat another clearing corporation and thecontract is not recorded until T+3. Theproposed rule change will shorten eachtime frames by two days.

The proposed rule change also willamend Article III, Rule 2, Section 9 tostate that a participant will be deemedto have requested delivery of a securityif the participant has entered intocontracts to be settled by MCC whichwill result in net settling sales of suchsecurity by the participant during thenext two, instead of four, business days.The proposed rule change also willamend the definition of ‘‘as-of contract’’in Article I, Rule 1, to include contractsfor which the intended date ofsettlement is one to two days, instead offour days, after the recording of thetransaction by MCC.

The MCC’s implementation of thisrules change will be consistent with the‘‘T+3’’ conversion schedule which theNational Securities Clearing Corporationhas proposed for industry use. Theschedule is as follows:

Trade date Settlementcycle Settlement date

June 2 Fri-day.

5 day ......... June 9 Friday

June 5Monday.

4 day ......... June 9 Friday


1 15 U.S.C. § 78s(b)(1) (1988).

2 In August 1994, the CHX sold its interest inMBX to the participants of MBS and to the NationalSecurities Clearing Corporation.

3 15 U.S.C. § 78q–1 (1988).

Trade date Settlementcycle Settlement date

June 6Tuesday.

4 day ......... June 12 Monday

June 7Wednes-day.

3 day ......... June 12 Monday

If the Commission determines to alterthe exemptions currently provided inRule 15c6–1, MCC may need toundertake additional rule amendments.It is intended that the proposed rulechanges are to become effective on thesame date as Commission Rule 15c6–1.

The proposed rule change isconsistent with Section 17A of theExchange Act in that it will facilitate thesafeguarding of securities and fundswhich are in MCC’s custody or controlor for which MCC is responsible. Theproposed rule change also is consistentwith proposed Rule 15c6–1 whichrequires brokers or dealers to settle mostsecurities transactions no later than thethird business day after the date of thecontract unless otherwise expresslyagreed to by the parties at the time ofthe transaction.


MCC does not believe that theproposed rule change will impose anyburden on competition that is notnecessary or appropriate in furtheranceof the purposes of the Act.

C. Self-Regulatory Organization’sStatement on Comments on theProposed Rule Change Received FromMembers, Participants or Others.

No written comments were eithersolicited or received.


Within thirty-five days of the date ofpublication of this notice in the FederalRegister or within such longer period (i)as the Commission may designate up toninety days of such date if it finds suchlonger period to be appropriate andpublishes its reasons for so finding or(ii) as to which MCC 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 foregoing.Persons making written submissionsshould file six copies thereof with the

Secretary, 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 MCC. All submissions shouldrefer to File No. SR–MCC–94–16 andshould be submitted by February 17,1995.

For the Commission by the Division ofMarket Regulation, pursuant to delegatedauthority.

Jonathan G. Katz,Secretary.[FR Doc. 95–2071 Filed 1–26–95; 8:45 am]


[Release No. 34–35259; File Nos. SR–MCC–94–15 and SR–MSTC–94–18]

Self-Regulatory Organizations;Midwest Clearing Corporation andMidwest Securities Trust Company;Notice of Filing and ImmediateEffectiveness of Proposed RuleChanges Eliminating MBS ClearingCorporation’s Right to Collect MoniesFrom the Participants Funds

January 20, 1995.

Pursuant to Section 19(b)(1) of theSecurities Exchange Act of 1934(‘‘Act’’),1 notice is hereby given that onDecember 8, 1994, Midwest ClearingCorporation (‘‘MCC’’) and MidwestSecurities Trust Company (‘‘MSTC’’)filed with the Securities and ExchangeCommission (‘‘Commission’’) theproposed rule changes (File Nos. SR–MCC–94–15 and SR–MSTC–94–18) asdescribed in Items I, II, and III below,which items have been preparedprimarily by MCC and MSTC. TheCommission is publishing this notice tosolicit comments on the proposed rulechanges from interested persons.

I. Self-Regulatory Organizations’Statement of the Terms of Substance ofthe Proposed Rule Changes

These rule changes amend Article IX,Rule 2, Section 3 of MCC’s Rules andArticle VI, Rule 2, Section 3 of MSTC’sRules to eliminate the right of MBSClearing Corporation (‘‘MBS’’) to collectmonies, respectively, from the MCCParticipants Fund and from the MSTCParticipants Fund when an MCC orMSTC participant fails to discharge aliability to MBS.

II. Self-Regulatory Organizations’Statement of the Purpose of, andStatutory Basis for, the Proposed RuleChanges

In their filings with the Commission,MCC and MSTC included statementsconcerning the purpose of and basis forthe proposed rule changes anddiscussed any comments they receivedon the proposed rule changes. The textof these statements may be examined atthe places specified in Item IV below.MCC and MSTC have preparedsummaries, set forth in sections (A), (B),and (C) below, of the most significantaspects of such statements.

(A) Self-Regulatory Organizations’Statement of the Purpose of, andStatutory Basis for, the Proposed RuleChanges

The purpose of the proposed changesis to eliminate the right of MBS tocollect money from the MCCParticipants Fund and from the MSTCParticipants Fund when an MCCparticipant or an MSTC participant,respectively, fails to discharge a liabilityowed to MBS. MBS is no longeraffiliated with MCC, MSTC or with theChicago Stock Exchange (‘‘CHX’’), theparent corporation of both MCC andMSTC.2 The proposed rule changes alsoamend Article II, Rule 3, Section 1 andArticle IX, Rule 2, Section 3 of MCC’sRules and Article VI, Rule 2, Section 3of MSTC’s Rules to change references tothe Midwest Stock Exchange to eitherCHX or the Exchange in order to reflectCHX’s name change.

MCC and MSTC believe that theproposed rule changes are consistentwith Section 17A of the Act 3 in thatthey provide for the prompt andaccurate clearance and settlement ofsecurities transactions including thesafeguarding of securities and fundsrelated thereto.


4 15 U.S.C. 78s(b)(3)(A)(iii) (1988).5 17 CFR 240.19b–4(e)(3) (1994).

6 17 CFR 200.30–3(a)(12) (1994).1 15 U.S.C. § 78s(b)(1) (1988).

2 For a description of ACT, refer to SecuritiesExchange Act Release Nos. 27229 (September 8,1989), 54 FR 38484 [File No. SR–NASD–89–25](order partially approving proposed rule change topermit ACT to be used by selfclearing firms) and28583 (October 26, 1990), 55 FR 46120 [File No.SR–NASD–89–25] (order approving remainder ofFile SR–NASD–89–25 to permit ACT to be used byintroducing and correspondent broker-dealers).

3 ACT uses three methods to lock-in trades: (1)trade-by-trade match, whereby both sides of thetrade are reported to ACT and matched; (2) tradeacceptance, whereby one side of the trade isreported to ACT and accepted by the contra-side;and 93) aggregate volume match, whereby ACTperforms a batch-type comparison at the end ofeach day that aggregates previously unmatchedtrade reports to effect a match. (For example, twoidentical trade reports for 300 and 400 shares of thesame security may be matched with a 700 sharetrade report.)

4 Among others, ACT has the following riskmanagement capabilities. First, ACT can computethe dollar value of each trade report entered therebyallowing member firms to assess their marketexposure during the trading day. Second, clearingfirms can establish daily gross dollar thresholds foreach correspondent’s trading activity. If acorrespondent reaches or exceeds the threshold, theclearing firm is so notified. Third, ACT alertsclearing firms when a correspondent reaches 70%or 100% of its daily gross dollar threshold. Fourth,ACT has a single trade limit that provides clearingfirms with a 15 minute review period prior tobecoming obligated to clear a trade of $1,000,000 ormore executed by one of its correspondents. Fifth,ACT has a super cap limit set at two times the grossdollar thresholds for purchases and sales but in noevent less than $1 million that provides clearingfirms with a 15 minute review period prior tobecoming obligated to clear a trade of $200,000 ormore executed by one of its correspondents oncethe limit is surpassed.

(B) Self-Regulatory Organizations’Statements on Burden on Competition

MCC and MSTC believe that theproposed rule changes will not placeany burden on competition.

(C) Self-Regulatory Organizations’Statement on Comments on theProposed Rule Changes Received FromMembers, Participants, or Others

MCC and MSTC have neither solicitednor received any written comments onthe proposed rule changes.

III. Date of Effectiveness of theProposed Rule Changes and Timing forCommission Action

The foregoing rule changes havebecome effective pursuant to Section19(b)(3)(A)(iii) of the Act 4 andsubparagraph (e)(3) of Rule 19b–4thereunder 5 because they are concernedsolely with the administration of theself-regulatory organizations. At anytime within sixty days of the filing ofsuch proposed rule changes, theCommission may summarily abrogatesuch rule changes if it appears to theCommission that such action isnecessary or appropriate in the publicinterest, for the protection of investors,or otherwise in furtherance of thepurposes of the Act.

IV. Solicitation of Comments

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 thesubmission, all subsequentamendments, all written statementswith respect to the proposed rulechanges that are filed with theCommission, and all writtencommunications relating to theproposed rule changes 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 atthe Commission’s Public ReferenceSection, 450 Fifth Street, NW.,Washington, DC 20549. Copies of suchfilings will also be available forinspection and copying at the principaloffices of MCC and MSTC. Allsubmissions should refer to FileNumbers SR–MCC–94–15 and SR–MSTC–94–18 and should be submittedby February 17, 1995.


Margaret H. McFarland,Deputy Secretary.[FR Doc. 95–2072 Filed 1–26–95; 8:45 am]BILLING CODE 8010–01–M

[Release No. 34–35257; International SeriesRelease No. 776; File No. SR–NASD–94–55]

Self-Regulatory Organizations;National Association of SecuritiesDealers; Notice of Proposed RuleChange Relating to the Access of WestCanada Clearing Corporation and ItsMembers to the AutomatedConfirmation Transaction Service


Securities Exchange Act of 1934(‘‘Act’’),1 notice is hereby given that onOctober 12, 1994, the NationalAssociation of Securities Dealers, Inc.(‘‘NASD’’) filed with the Securities andExchange Commission (‘‘Commission’’)the proposed rule change as describedin Items I, II, and III below, which Itemshave been prepared primarily by theNASD. The Commission is publishingthis notice to solicit comments on theproposed rule change from interestedpersons.


The NASD proposes to amend its ruleregarding the Automated ConfirmationTransaction services (‘‘ACT’’) to allowWest Canada Clearing Corporation(‘‘West Canada’’), a nonmember of theNASD, and members of West Canadawho are not members of the NASD toaccess this service. The NASD alsoproposes to amend the ACT rule toreflect that NASD members functioningas market makers in over-the-counterequity securities are also classified asACT participants.


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 in

sections (A), (B), and (C) below, of themost significant aspects of suchstatements.


The NASD created and implementedthe ACT system in response to problemsexperienced in the wake of the October1987 market break and at the urging ofthe Commission to consider acceleratingefforts to generate same day comparedtrades.2 ACT has three primary features:(1) trade match process (i.e., thecomparison of trade information and thesubmission of locked-in trades forregular way settlement to clearingagencies on a trade date or next day[‘‘T+1’’] basis); 3 (2) trade reporting fortransactions in securities that are subjectto real time trade reportingrequirements; and (3) risk managementfeatures that provide firms with acentralized, automated environment forassessing market exposure during andafter the trading day and that permitclearing firms to monitor and respond tothe ongoing trading activities of theircorrespondents.4

Since its implementation, ACT hasfunctioned as an effective and efficient


5 The present filing solely addresses the access ofWest Canada to ACT. Other proposals concerningnonmember access to ACT, if any, will be raised inseparate rule filings submitted pursuant to Section19 of the Act.

6 In January 1983, MCC, Midwest Securities TrustCompany (‘‘MSTC’’), the Vancouver StockExchange, and the Vancouver Stock ExchangeService Corporation (‘‘VSESC’’), (now known asWest Canada Clearing Corporation [‘‘WCCC’’])(‘‘VSESC/WCCC’’) created the American andCanadian Connection for Efficient SecuritiesSettlements (‘‘ACCESS’’). Through ACCESS, over-the-counter securities transactions between the U.S.and Canadian broker-dealers in both U.S. andCanadian securities are compared, cleared, andsettled. Trades between U.S. and Canadian broker-dealers involving securities listed on U.S. securitiesexchanges, Canadian securities exchanges, or theNational Association of Securities DealersAutomated Quotation (‘‘NASDAQ’’) System areeligible for clearance and settlement throughACCESS. To establish ACCESS, VSESC/WCCCbecame an MCC/MSTC participant, and openedseparate sponsored MCC/MSTC accounts forCanadian broker-dealers that were participants ofVSESC. As an MCC/MSTC member, VSESC/WCCCis liable as principal (i.e., guarantees) all trades thatit submits including all trades in its sponsoredaccounts. Some safeguards on ACCESS activityinclude, contributions by VSESC/WCCC to MCC/MSTC’s participant fund based on VSESC/WCCC’stotal activity, and a cash reserve of over 250,000Canadian dollars maintained by VSESC/WCCC tobe used to satisfy the obligations of any VSESC/WCCC participant that may become insolvent. Inaddition, VSE guarantees all VSESC/WCCCliabilities to MCC/MSTC. Letter from JonathanKallman, Assistant Director, Division of MarketRegulation, Commission, to Michael Wise,Associate Counsel, MCC/MSTC (September 12,1985).

vehicle to compress the tradecomparison cycle thereby facilitatingthe prompt and accurate clearance andsettlement of securities transactions andenabling NASD members to know theirpositions and market exposure beforetrading commences the next day. As afacility of The Nasdaq Stock Marketoperated by The Nasdaq Stock Market,Inc. (‘‘NSMI’’) subsidiary of the NASD,access to the ACT system is limited toNASD members. Recently, the NASDreceived a request from West Canada foraccess to ACT for trade comparisonpurposes only.5 Presently, when anNASD member effects a transaction witha West Canada member, the transactiontypically is compared, cleared, andsettled in the following manner. TheNASD member enters the trade intoACT with the West Canada memberdesignated as the contra-party. Becausethe West Canada member presently isnot an ACT participant, ACT willrespond to the NASD member ‘‘contra-side not ready.’’ ACT then will reportthe trade for trade reporting purposesand will transmit the trade to theNational Securities Clearing Corporation(‘‘NSCC’’) as a one-sided trade for tradecomparison. The West Canada membersubmits the trade information to WestCanada that in turn sends the trade tothe Midwest Clearing Corporation(‘‘MCC’’). MCC then transmits the tradereport to NSCC by 2:00 a.m. on T+1 forcomparison. NSCC then compares thetrade reports, and assuming there is amatch, NSCC submits the West Canadamember’s side of the transaction to MCCfor clearance and settlement; the NASDmember’s side of the transaction isretained by NSCC for clearance andsettlement. If there is a discrepancyconcerning the terms of the transaction,the trade reconciliation process involvesthe two clearing corporations and thetwo parties to the transaction and canlast until T+3. Although the NASDbelieves that the facilities of NSCC andMCC have been used to compare tradesbetween NASD and West Canadamembers adequately, the NASD believesthe trade comparison procedure forthese trades would be streamlined andmade more efficient through the use ofACT.

The proposal to provide West Canadaaccess to ACT has been structured sothat the primary parties to thearrangement are West Canada andNSMI, the NASD subsidiary that ownsand operates ACT. Rather than

negotiating separate contracts with eachindividual organization, the NASDbelieves that it is more efficient forNSMI to negotiate with the exchange,market, or clearing entity to which thenon-NASD member belongs, in this caseWest Canada. Accordingly, under theproposed rule change, West Canada willoperate as a service bureau to inputinformation into ACT on behalf of WestCanada members. Individual WestCanada members will not be able toobtain access to ACT unless there is firstan overriding, umbrella-type agreementreached between NSMI and WestCanada. Thus, whenever NASDmembers transact with West Canadamembers in ACT eligible securities, theywill be able to use ACT just as they donow for comparing regular-way tradeswith other NASD members.

In order for West Canada to haveaccess to ACT, proposed Section(b)(5)(B) of the ACT Rules provides thatWest Canada must execute a Non-member Clearing Organization ACTParticipant Application Agreement.This agreement will require WestCanada to abide by the ACT rules andregulations and will ensure that tradesprocessed through ACT by West Canadaon behalf of West Canada members willbe accepted for clearance andsettlement. The agreement also willaddress NSMI concerns overnonpayment of service charges, thefinancial exposure and liabilities of theparties, and methods of redress shouldWest Canada or a West Canada memberfail to comply with the relevant NASDrules and regulations. In addition,proposed section (b)(5)(B)(6) of the ACTRules provides that West Canada willnot be able to input information intoACT on behalf of a West Canadamember unless such member also entersinto a Non-Member ACT AccessParticipant Application Agreement withNSMI. In the case of a clearing broker,this agreement provides that themember will accept and will settle eachtrade that ACT identifies as having beeneffected by such member or any of itscorrespondents on the regularlyscheduled settlement date. In the case ofan order entry firm, the firm must agreeto accept and settle each trade that it haseffected or, if settlement is to be madethrough a clearing member, guaranteethe acceptance and settlement of eachACT-identified trade by the clearingmember on the regularly scheduledsettlement date.

The proposed rule change alsoprovides that a nonmember clearingorganization will not be given access toACT unless it: (1) Is a clearing agencyregistered under the Act; (2) maintainsmembership in a registered clearing

agency; or (3) maintains an effectiveclearing arrangement with a registeredclearing agency. West Canada has aneffective clearing arrangement withMCC and thus satisfies thisrequirement.6 This requirement willensure that non-NASD members givenaccess to NASD facilities will otherwisebe subject to Commission regulation ingeneral, and Commission regulationconcerning the comparison, clearance,and settlement of securities, inparticular.

The proposed rule change alsoprovides that West Canada may permitits members that operate as clearingbrokers or order entry firms to havedirect access to ACT but only if theWest Canada member has executed aNon-Member ACT ParticipantApplication Agreement with NSMI.This agreement will help to ensure thatWest Canada members adhere torelevant NASD and Commission rulesand regulations and commit to acceptand settle or guarantee the acceptanceand settlement of trades for which ACThas identified those members as beingresponsible.

As a result, the inefficiencies inherentin the current practice of submittingtwo-sided transaction reports to twoseparate clearing corporations for eachtransaction for comparison will beeliminated. The compressed comparisoncycle in turn also should result in lowerexposure to NASD members and theircustomers from price movements while


7 Securities Exchange Act Release No. 30415(February 26, 1992), 57 FR 7829 [File No. SR–NASD–92–5] (order approving OTC EquitySecurities as ACT eligible securities).

8 Under Schedule D to the NASD By-Laws, PartXII, Section 1(d) defines ‘‘OTC Market Maker’’ tomean any NASD member that holds itself out asbeing a market maker in any OTC Equity Securityby entering proprietary quotations or indications ofinterest in an inter-dealer quotation system.

9 15 U.S.C. § 78o–3(b)(6) (1988).10 15 U.S.C. § 78q–1(a) (1988).11 On October 6, 1993, the Commission adopted

Rule 15c6–1 under the Act, which establishes threebusiness days after the trade date instead of fivebusiness days as the standard settlement timeframefor most broker-dealer transactions. SecuritiesExchange Act Release No. 33023 (October 6, 1993),58 FR 52891 (release adopting Rule 15c6–1). OnNovember 16, 1994, the Commission changed the

effective date of Rule 15c6–1 from June 1, 1995, toJune 7, 1995. Securities Exchange Act Release No.34952 (November 9, 1994), 59 FR 59137.

12 Access to the ACT Service desk, however, willcontinue to be limited to NASD member firms. TheACT Service desk allows input into ACT by thosefirms that do not have direct access to ACT, or bydirect participant’s of ACT that are having troublewith their own system.

transactions are open or uncompared,faster and more efficient tradereconciliation and confirmation, andincreased efficiency of back officeoperations. Finally, the NASD notes thatgranting West Canada access to ACTwill not affect or modify the process bywhich trades between NASD and WestCanada members are cleared andsettled. The proposal strictly provides amore efficient and streamlined methodto compare trades between West Canadaand NASD members in preparation forclearance and settlement.

The NASD also does not believe thatgranting West Canada and West Canadamembers access to ACt will jeopardizethe integrity of ACT or any other marketfacility operated by NSMI. In thisregard, before West Canada or any of itsmembers are granted access to ACT,these entities must agree to be bound bythe terms of the revised ACT ParticipantApplication Agreements, whichestablish the terms and conditionsunder which West Canada and itsmembers will receive access to ACT.The NASD believes that the revisedAgreements will provide an adequateand sufficient surrogate for NASDmembership which otherwise wouldprovide the jurisdictional nexus toensure compliance with applicableNASD rules and regulations. Initial andcontinuing access to ACT bynonmembers will be specificallyconditioned upon adherence to theterms and conditions of theseagreements. West Canada and WestCanada members also will be requiredto maintain the physical security of theequipment used to input trades intoACT. Based on these factors, the NASDbelieves that granting West Canada andWest Canada members access to ACTwill not compromise the integrity oroperation of ACT. Further, the NASDnotes that the Commission has allowednonmember access to ACT in thecontext of trade reporting for Nasdaq-listed securities traded on an exchangepursuant to unlisted trading privileges(‘‘UTP’’). Specifically, UTP participantsmay trade report through ACT tocomply with transaction reportingrequirements.

Apart from addressing ACT access byWest Canada and West Canadamembers, this proposed rule changeproposes to amend Section a) 2. of theACT Rules which defines the term‘‘Participant.’’ As amended, thisdefinition will include NASD memberfirms that function as market makers inover-the-counter (‘‘OTC’’) equitysecurities that are eligible for clearing

via the NSCC’s facilities.7 The instantmodification will clarify that ACTparticipant status encompasses NASDmembers that function as market makersin such securities via the OTC BulletinBoard service or another interdealerquotation system.8 This element of therule proposal is a technical change thathas no bearing on the provisionregarding ACT access to West Canada.

The NASD believes that the proposedrule change is consistent with Sections15A(b)(6) 9 and 17A(a) 10 of the Act.Section 15A(b)(6) requires that the rulesof a national securities association bedesigned to promote just and equitableprinciples of trade, to foster cooperationand coordination with persons engagedin regulating, clearing, settling, andprocessing information with respect tosecurities, to remove impediments toand perfect the mechanism of a free andopen market and a national marketsystem, and, in general, to protectinvestors and the public interest.Section 17A(a) provides that the promptand accurate clearance and settlement ofsecurities transactions is necessary forthe protection of investors and thatinefficient procedures for clearance andsettlement impose unnecessary costs oninvestors.

By streamlining and improving theprocess by which trades between NASDand West Canada members arecompared, the NASD believes theprompt and accurate clearance andsettlement of securities will befacilitated and promoted. In addition, bycompressing the time-period in whichopen trades are left uncompared, marketparticipants will be better able to accessand evaluate their market exposurethereby contributing to fair and orderlymarkets and the protection of investorsand the public interest. Moreover, theNASD believes the proposed rulechange is consistent with Rule 15c6–1,which mandates settlement on the thirdbusiness day following the trade date(‘‘T+3’’) by June 7, 1995.11 Because ACT

generally achieves locked-in tradeswithin minutes of an execution, theNASD believes the ability to complywith the shorter time constraintsnecessitated by T+3 settlement will beenhanced. Accordingly, the NASDproposes to amend its rules governingACT to accommodate the access of WestCanada to ACT.12


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.

C. Self-Regulatory Organization’sStatement on Comments on theProposed Rule Change Received fromMembers, Participants, or Others

Comments were neither solicited norreceived.


Within thirty-five days of the date ofpublication of this notice in the FederalRegister or within such longer period (i)as the Commission may designate up toninety 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 foregoing.Persons making written submissionsshould file six copies thereof with theSecretary, Securities and ExchangeCommission, 450 Fifth Street, N.W.,Washington, D.C. 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 the


13 17 CFR 200.30–3(a)(12) (1994).1 15 U.S.C. § 78s(b)(1) (1988).2 17 CFR 240.19b–4 (1991).

3 The Exchange notes that its members who arealso NYSE members, for example, are currentlysubject to the NYSE’s registration provisions; ‘‘Phlx-only’’ members would now be subject to acorresponding provision.

4 The Series 7 Examination is an industry-widequalification examination for persons seekingregistration as general securities representatives.The Commission recently approved a proposed rulechange that updated the Series 7 Examination.Securities Exchange Act Release No. 34853 (October18, 1994), 59 FR 53694.

5 The proposal would define a professionalcustomer to include: a bank, trust company,insurance company, investment trust, state orpolitical subdivision thereof, charitable or nonprofiteducational institution regulated under the laws ofthe United States, or any state, or pension or profitsharing plan subject to ERISA or of an agency of theUnited States or of a state or political subdivisionthereof or any person who has, or has undermanagement, net tangible assets of at least sixteenmillion dollars. For purposes of this definition ofprofessional customer, the term ‘‘person’’ shallmean the same as that term is defined in Phlx Rule20, except that it shall not include natural persons.

6 The Exchange will use the Series 7AExamination that was approved in SR–NYSE–93–10(Securities Exchange Act Release No. 32698 (July29, 1993), 58 FR 41539). The Series 7A Examinationfor Phlx members will be administered by the NewYork Stock Exchange, Inc. (‘‘NYSE’’). Telephoneconversation between Edith Hallahan, SpecialCounsel, Regulatory Services, Phlx and ElisaMetzger, Senior Counsel, Office of MarketSupervision, Division of Market Regulation, SEC,on December 5, 1994.

7 15 U.S.C. § 78f(b)(5) and (c)(3)(B) (1988).8 15 U.S.C. § 78o(b)(7) (1988).

public 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 File No.SR–NASD–94–55 and should besubmitted by February 17, 1995.



[Release No. 34–35258; File No. SR–Phlx–94–15]

Self-Regulatory Organizations;Philadelphia Stock Exchange, Inc.;Order Granting Approval to ProposedRule Change Relating to LimitedRegistration/Floor MemberRegistration Status and the Use of theSeries 7A Examination

January 20, 1995.

On October 3, 1994, the PhiladelphiaStock Exchange, Inc. (‘‘Phlx’’ or‘‘Exchange’’) submitted to the Securitiesand Exchange Commission (‘‘SEC’’ or‘‘Commission’’), pursuant to Section19(b)(1) of the Securities Exchange Actof 1934 (‘‘Act’’) 1 and Rule 19b–4thereunder,2 a proposed rule change toamend Rule 604, Registration andTermination of RegisteredRepresentatives, to adopt a limitedregistration provision applicable topersons conducting a professionalcustomer business from the Phlx tradingfloor and to adopt the Content Outlinefor the Examination Module for FloorMembers Engaged in Public Businesswith Professional Customers (‘‘ContentOutline’’). The Exchange also proposesto adopt a requirement that personsconducting functions customarilyperformed by a registered representativemust register and be qualified pursuantto Phlx Rule 604.

The proposed rule changes werepublished for comment in SecuritiesExchange Act Release No. 35055(December 7, 1994), 59 FR 64452(December 14, 1994). No commentswere received on the proposals. Thisorder approves the proposed rulechanges.

I. ProposalPhlx Rule 604, Registration and

Termination of RegisteredRepresentatives, currently requiresevery registered representative of amember or participant organization tobe registered with and approved by thePhlx. The Phlx proposes to amend Rule604 to clarify that not only registeredrepresentatives, but also personsconducting functions customarilyperformed by a registered representativemust register and be qualified pursuantto Phlx Rule 604.3 The Exchange seeksto clarify this requirement by adoptinga specific provision in Rule 604(a)which would expressly state thatconducting a public business requiresregistration pursuant to the GeneralSecurities Registered Representative(‘‘Series 7’’) Examination.4

In addition to amending Rule 604(a),the Exchange seeks to adopt a newparagraph (c) of Rule 604 to permit alimited registration for personsconducting a professional customerbusiness from the Phlx trading floor. Inlieu of full registration as a registeredrepresentative, the proposed limitedregistration would apply to acceptingorders from professional customersonly, as defined in proposed Rule604(c)(i).5 Limited registration/floormembers would be required to registeras such with the Exchange and pass anexamination.6 This examination, asubset of the Series 7 Examination,

would be tailored toward theprofessional customer business beingconducted, testing knowledge requiredto conduct such a business. Theadvantage of such an examination isthat it would cover important topicsrelevant to conducting a professionalcustomer business, but not knowledgeparticular to conducting a retailbusiness. The Content Outline detailsthe topics contained in the examination:federal and state securities laws; generalcharacteristics of equity securities andcorporate bonds; conduct respectingcustomer accounts; primary andsecondary securities markets; and orderexecution, confirmation, settlement andrecordkeeping.

II. DiscussionThe Commission finds that the

proposed rule changes are consistentwith the requirements of the Act and therules and regulations thereunderapplicable to a national securitiesexchange, and in particular, with therequirements of Sections 6(b)(5) and6(c)(3)(B) of the Act.7 Section 6(b)(5)requires, among other things, that therules of an exchange be designed topromote just and equitable principles oftrade, to remove impediments to andperfect the mechanism of a free andopen market and a national marketsystem, and, in general, to protectinvestors and the public interest.Section 6(c)(3)(B) provides that anational securities exchange mayexamine and verify the qualifications ofan applicant to become a personassociated with a member in accordancewith procedures established by the rulesof the exchange, and require any personassociated with a member, or any classof such persons, to be registered withthe exchange in accordance withprocedures so established.

The Commission also believes that theproposed rule changes are consistentwith Section 15(b)(7) of the Act 8 whichstipulates that prior to effecting anytransaction in, or inducing the purchaseor sale of, any security, a registeredbroker or dealer must meet certainstandards of operational capability, andthat such broker or dealer (and allnatural persons associated with suchbroker or dealer) must meet certainstandards of training, experience,competence, and such otherqualifications as the Commission findsnecessary or appropriate in the publicinterest or for the protection ofinvestors.

The Commission also believes that theamendment to Rule 604(a) will clarify


9 See supra note 5.

10 15 U.S.C. § 78s(b)(2) (1988). 11 17 CFR 200.30–3(a)(12) (1991).

1 This order is currently before the commissionon remand from the D.C. Circuit Court of Appeals.See, New Orleans v. SEC, 969 F.2d 1163 (D.C. Cir.1992).

and put all persons on notice that anyperson who conducts a public businessis required to be registered and qualifiedas a registered representative. Suchregistration would require, among otherthings, that a person complete the Series7 examination, as described in rule604(a)(ii).

The Commission believes that theSeries 7A Examination requirementshould help to ensure that only thosefloor members with a comprehensiveknowledge of Exchange rules, as well asan understanding of the Act, will beable to conduct a public businesslimited to accepting orders directly fromprofessional customers for execution onthe trading floor. The Commission hasdetermined that the Content Outline forthe Series 7A Examination issufficiently detailed and covers theappropriate information so as to providean adequate basis for studying the topicscovered on the examination. Thisoutline should help to ensure that thosepersons taking the Series 7AExamination fully understand thesubject matter of the examination.

Finally, the Commission believes thatthe proposed limited registrationrequirement for floor members engagedin a public business with professionalcustomers is reasonable and isconsistent with the requirements ofSections 6(b)(5) and 6(c)(3)(B) of theAct. This new category of registrationwould permit only those floor memberswho have demonstrated adequate skillsand knowledge to conduct a publicbusiness which is generally limited toaccepting orders directly fromprofessional customers, as defined inthe rule,9 for execution on the tradingfloor. The Phlx has argued that the levelof knowledge, skills and abilitiesnecessary to conduct such business isless than that needed to conduct a fullservice business with retail customers.The Commission believes that, becausethe Phlx will ensure that floor membershandling professional customerbusiness are adequately qualifiedthrough the use of either the Series 7 orSeries 7A Examination, it is consistentwith the Phlx’s regulatoryresponsibilities to establish this categoryof limited registration.

III. Conclusion

It is therefore ordered, pursuant toSection 19(b)(2) of the Act,10 that theproposed rule change (SR–Phlx–94–15)is approved.

For the Commission, by the Division ofMarket Regulation, pursuant to delegatedauthority.11


[Release No. 35–26219]

Filings Under the Public Utility HoldingCompany Act of 1935, as amended(‘‘Act’’)

January 20, 1995.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 byFebruary 13, 1995, to the Secretary,Securities and Exchange Commission,Washington, DC 20549, and serve acopy on the relevant applications(s)and/or declarant(s) at the address(s)specified below. Proof of service (byaffidavit or, in case of an attorney atlaw, by certificate) should be filed withthe request. Any request for hearingshall identify specifically the issues offact or law that are disputed. A personwho so requests will be notified of anyhearing, if ordered, and will receive acopy of any notice or order issued in thematter. After said date, theapplication(s) and/or declaration(s), asfiled or as amended, may be grantedand/or permitted to become effective.

Entergy Corporation, et al.

[70–8535]Entergy Corporation (‘‘Entergy’’), 639

Loyola Street, New Orleans, Louisiana70113, a registered holding company,and its bulk power marketingsubsidiary, Entergy Power, Inc. (‘‘EPI’’)(together, ‘‘Applicants’’), ThreeFinancial Center, Little Rock, Arkansas72211, have filed an application-declaration under sections 6(a), 7, 9(a),10 and 12(b) of the Act and Rules 42,43 and 45 thereunder.

The Applicants request authority for:(1) Entergy to recapitalize EPI through

the conversion of outstanding amountsof principal and interest under theexisting $250 million loan agreementbetween Entergy and EPI (‘‘LoanAgreement’’) to capital contributions;and (2) Entergy to make additionalequity investments in EPI from time-to-time through December 31, 1995 to fundEPI’s working capital and other capitalrequirements.

By Commission orders, dated August27, 1990 (HCAR No. 25136) 1 and July16, 1992 (HCAR No. 25583) (‘‘Orders’’),EPI was formed and has been financedby Entergy to participate as a supplierof capacity and energy in the wholesalebulk power market. Under the Orders,EPI acquired the ownership interests ofits associate company, Arkansas Power& Light Company in Unit 2 of theIndependent Steam Electric GeneratingStation and Unit 2 of the Ritchie SteamElectric Generating Station representingan aggregate of 809 MW of capacity(‘‘Transferred Capacity’’). TheTransferred Capacity included variousleases, mine facilities and miningequipment, oil storage and handlingfacilities associated with providing fuelsupplies for the Transferred Capacity.

Entergy and EPA state that variousconstraints on EPI’s business activities,including the highly leveraged nature ofits authorized capital structure and theconsequent debt service requirements,which currently amounts toapproximately $4.1 million per quarter,have had a negative effect on EPI’sfinancial condition and significantlyimpaired its ability to market and sellthe Transferred Capacity. In order toprovide EPI with a capital structuremore suited to EPI’s authorizedactivities by eliminating EPI’s debtservice requirements under the LoanAgreement, Entergy and EPI propose toterminate the Loan Agreement and toconvert to capital contributions alloutstanding borrowings, in theapproximate amount of $217.55 million,together with any accrued and unpaidinterest through the date of theconversion. After the recapitalization,EPI’s capital structure would consist of100% equity.

The Applicants further propose thatEntergy make additional equityinvestments in EPI from time-to-timethrough December 31, 1995 in anaggregate amount not to exceed theapproximate total principal amount ofadditional borrowings EPI could havebeen under the Loan Agreement, as ofSeptember 30, 1994, or $32.45 million.


Additional investments by Entergy maytake the form of the issuance and saleby EPI, and the purchase by Entergy, ofadditional shares of EPI’s CommonStock and/or capital contributions. Theadditional investments would be usedby EPI to meet its working capitalrequirements and to pay its associatecompanies for services provided to EPI.

Eastern Utilities Associates, et al.

[70–8539]Eastern Utilities Associates (‘‘EUA’’),

P.O. Box 2333, Boston, Massachusetts02107, a registered holding company,and EUA Cogenex Corporation(‘‘Cogenex’’), wholly owned nonutilitysubsidiary company of EUA, and EUACogenex-Canada, Inc. (‘‘Cogen-Canada’’), and Northeast EnergyManagement, Inc. (‘‘NEM’’), two whollyowned nonutility subsidiary companiesof Cogenex, all located at Boott MillsSouth, 100 Foot of John Street, Lowell,Massachusetts 01852, have filed anapplication-declaration under sections6(a), 7, 9(a), 10, and 12(b) of the Act,and rules 42, 43 and 45 thereunder.

EUA proposes to invest in Cogenex,through December 31, 1997, up to anaggregate principal amount of $50million through any one or combinationof short-terms loans, capitalcontributions, or purchases of Cogenexcommon stock. EUA proposes to borrowup to $25 million under the EUA systemcredit lines, which if used, would fundthe short-term loans to Cogenex. Theterms and conditions of any loans madeto Cogenex would be the same as theterms and conditions under the EUAsystem credit lines.

Cogenex proposes, through December31, 1997, to obtain financing, in anamount not to exceed $200 million,from any of these sources: (i) up to $50million from EUA; and (ii) $150 millionfrom (a) the issuance and sale ofunsecured notes (‘‘New Notes’’) througha private or a public offering, (b) theborrowing of proceeds from the issuanceand sale of bonds by a state or politicalsubdivision agency (‘‘Bonds’’), and (c)the borrowing of up to $75 millionunder the EUA system credit lines.Cogenex will use the proceeds: (i) topay, reduce, or renew short-term bankloans; (ii) to pay, reduce, or renew short-term loans from EUA; (iii) for workingcapital to operate its demand sidemanagement, energy conversation andself-generation business and generalcorporate purposes; (iv) to pay the costsof issuance of the New Notes andBonds; and (v) to provide for debtservicing reserves or expenses forissuance of the New Notes and Bonds.

The terms and conditions of the NewNotes and the Bonds will be provided

in a post-effective amendment, the EUAand Cogenex request a reservation ofjurisdiction over the issuance and saleof the New Notes and Bonds.

Interest on notes issued under theexisting EUA system credit lines areeither the prime rate or money marketrates, and may include a commitmentfee. The weighted average interest ratefor borrowings under the EUA systemcredit lines on November 30, 1994, was1% per annum. Notes issued under theEUA system credit lines will mature innot more than one year and theprincipal amount of notes that EUA andCogenex will have outstanding at onetime will not exceed $25 million and$75 million, respectively.

EUA also proposes, if it becomesnecessary to obtain favorable terms forthe New Notes and Bonds, to guarantythe New Notes and Bonds or provide anequity maintenance agreement, underwhich EUA would make capitalcontributions to Cogenex if Cogenex’sequity as a percentage of totalcapitalization fell below a specifiedlevel.

Cogenex proposes to extend, untilDecember 31, 1997, its authority toinvest in Cogen-Canada and NEM, andCogen-Canada and NEM propose toextend their authority to December 31,1997, to borrow from Cogenex. Cogenexis currently authorized to invest inCogen-Canada in an amount not toexceed $20 million through stockpurchases, capital contribution, openaccount advances, and short-term loans.Cogenex is currently authorized toinvest in NEM in an amount not toexceed $9.1 million through capitalcontributions and short-term loans.Cogenex’s authority to invest, andNEM’s and Cogen-Canada’s authority toborrow from Cogenex expires December31, 1995. Cogenex does not propose toincrease the amount it may invest inCogen-Canada or NEM.

National Fuel Gas Company, et al.

[70–8541]National Fuel Gas Company

(‘‘National’’), a registered holdingcompany, and its wholly ownednonutility subsidiary companies,National Fuel Gas Resources(‘‘Resources’’), National Fuel GasSupply (‘‘Supply’’), Seneca ResourcesCorporation (‘‘Seneca), and UtilityConstructors (‘‘Constructors’’), andNational Fuel Gas DistributionCompany (‘‘Distribution’’), a whollyowned gas public utility subsidiarycompany of National, all of 10 LafayetteSquare, Buffalo, New York 14203, havefiled an application-declaration undersections 6(a), 7, 9(a), 10 and 12(b) of theAct and rules 42, 43, and 45 thereunder.

National proposes to issue and sell,through December 31, 1997, in one ormore transactions, up to an aggregateprincipal amount of $350 million ofdebt securities in any combination of (a)debentures (‘‘Debentures’’) and (b)medium-term notes (‘‘MTNs’’), whichwill mature in not over 40 years. TheDebentures will be offered by use ofnegotiated sales or competitive bidding.The MTNs will be offered, as needed,through agents. National will not issueDebentures or MTNs at rates in excessof those generally obtained at the timeof pricing for sales of medium-termnotes or debentures having the samematurity, issued by companies ofcomparable credit quality and havingsimilar terms, conditions, and features.The price and annual interest rate(which may be fixed or variable) of eachseries of Debentures and MTNs will bedetermined at the time of bidding orwhen the agreement to sell is made.

The Debentures and MTNs will beissued under an Indenture dated as ofOctober 15, 1974, as supplemented, andas it will be supplemented by one ormore supplemental indentures. Thesupplemental indentures, whichprovide for the issuance of theDebentures and the MTNs, may includeprovisions for redemption prior tomaturity at various percentages of theprincipal amount and may includerestrictions on optional redemption fora given number of years up to the termof the Debentures and MTNs.

National proposes to lend from theproposed financing, in exchange forunsecured notes (‘‘Notes’’), up to (a)$250 million to Distribution; (b) $150million to Supply; (c) $150 million toSeneca; (d) $20 million to Resources;and (e) $20 million to Constructors. Thetotal amount lent from National to thesubsidiaries will not exceed theproceeds National receives fromissuance of the Debentures and MTNs.

The Notes to be issued by thesubsidiaries will bear interest at theeffective interest cost of the principalamount of the related Debentures andMTNs. National will have the option torequire payment of the notes at any timeif the related Debentures and MTNsmature, are redeemed, or otherwiseacquired by National. The subsidiarieswill use the proceeds from the Notes: (i)To reduce short-term debt under certaincredit lines; (ii) to repay notes issued toNational in connection with the sale byNational of certain debentures andmedium-term notes; (iii) forconstruction or other capitalexpenditure programs; and (iv) forgeneral corporate purposes.

National also proposes, in connectionwith its long-term financing, to enter


into one or more interest rate swaps andrelated interest rate caps, collars andfloors, through December 31, 1997, innotional amounts that in the aggregatewill not exceed $350 million.

National requests authorization tomake floating-to-fixed rate (‘‘Strategy 1Swaps’’) and fixed-to-floating rate swaps(‘‘Strategy 2 Swaps’’). Under Strategy 1Swaps, National would make periodicinterest payments at a floating rate ofinterest, calculated on an agreednotional amount, in return for periodicinterest payments based upon the samenotional amount but payable at anagreed-upon fixed rate of interest. UnderStrategy 2 Swaps, National would pay afixed interest rate and receive a variableinterest rate on an agreed notionalamount.

National’s floating rate of interest forStrategy 1 Swaps would be based oncertain indices, such as the LondonInterbank Deposit Offered Rate, theFederal Funds Rate, certificate ofdeposit indices, or commercial paperindices. There will be no maximuminterest rate respecting payments thatNational may make under Strategy 1Swaps unless National purchases aninterest rate cap. However, National willnot enter a Strategy 1 Swap in which thefloating interest rate it pays wouldexceed by more than 200 basis points,at each reset period, the index used forthe Strategy 1 Swap. The fixed interestNational receives in a Strategy 1 Swapis calculated as that rate of interest thatsets the net present value of the forwardcurve for the short-term index to zero,plus the bid/ask spread. Thus, the fixedrate chosen will be a rate that discountsthe floating interest payments expectedby the market to be paid by Nationalover the life of the swap to an amountthat equals the present value of the fixedinterest payments to National, exclusiveof the bid-ask spread.

To protect against adverse interestrate changes on floating rate debt,National may purchase one or moreinterest rate caps or may additionallysell an interest rate floor to either lowerthe cost of the debt under the floor or,in conjunction with an interest rate cap,to lower the cost of the cap.

National will not enter any Strategy 2Swaps if the fixed rate of interest paidby National would exceed 2% over theyield on U.S. Treasury obligationsbearing comparable terms. Strategy 2Swaps would be used in lieu of issuingDebentures or MTNs. The aggregatenotional amount of Strategy 2 Swapswill not, at any one time, exceed thedifference between (a) $350 million and(b) the aggregate principal amount ofDebentures and MTNs then outstanding.Furthermore, the aggregate notional

amount of Strategy 2 Swaps will notexceed, at the time the swap contract isentered into, the difference between (a)the amount of short-term debt thenoutstanding pursuant to National’sshort-term borrowing arrangements (FileNo. 70–8297) (which shall not exceed$400 million) and b) the aggregationnotional amount of swaps thenoutstanding pursuant to National’sshort-term borrowings and systemMoney Pool arrangements (File No. 70–8297). In no event will the aggregatenotional amount of Strategy 2 Swaps, atany one time, exceed $350 million.

The term of Strategy 1 Swaps couldvary from one month to forty years,while the term of Strategy 2 Swapscould vary from nine months to fortyyears.

Each time National issues debentureor medium-term notes, the proceeds arelent to one or more of its subsidiaries atan all-in cost that is equal to the couponon the debt plus the amortization of theunderwriters or agents’ fees. Similarlyeach interest rate swap, cap, floor, orcollar would ‘‘directly relate’’ to thenoutstanding debt so that the gains andlosses of doing a swap and one or morederivative instruments would beallocated to the subsidiary on whosebehalf the underlying debt was issued.The subsidiary will enter an agreementwith National for the financialobligations of the swaps and otherderivatives.

For the Commission, by the Division ofInvestment Management, pursuant todelegated authority.Jonathan G. Katz,Secretary.[FR Doc. 95–2024 Filed 1–26–95; 8:45 am]BILLING CODE 8010–01–M

SMALL BUSINESS ADMINISTRATION

Reporting and RecordkeepingRequirements Under OMB Review

ACTION: Notice of reporting requirementssubmitted for review.

SUMMARY: Under the provisions of thePaperwork Reduction Act (44 U.S.C.Chapter 35), agencies are required tosubmit proposed reporting andrecordkeeping requirements to OMB forreview and approval, and to publish anotice in the Federal Register notifyingthe public that the agency has madesuch a submission.DATES: Comments should be submittedon or before February 27, 1995. If youintend to comment but cannot preparecomments promptly, please advise theOMB Reviewer and the AgencyClearance Officer before the deadline.

COPIES: Request for clearance (S.F. 83),supporting statement, and otherdocuments submitted to OMB forreview may be obtained from theAgency Clearance Officer. Submitcomments to the Agency ClearanceOfficer and the OMB Reviewer.

FOR FURTHER INFORMATION CONTACT:

Agency Clearance Officer: CleoVerbillis, Small BusinessAdministration, 409 3RD Street, SW.,5th Floor, Washington, DC 20416,telephone: (202) 205–6629.

OMB Reviewer: Donald Arbuckle, Officeof Information and Regulatory Affairs,Office of Management and Budget,New Executive Office Building,Washington, DC 20503.

Title: 8(a) Application Forms.Form No.: SBA Forms 1010A, 1010B-

Proprietorship, Partnership,Corporation, 1010C.

Frequency: On Occasion.Description of Respondents: 8(a)

Applicants.Annual Responses: 11,000.Annual Burden: 55,000.

Dated: January 19, 1995.Cleo Verbillis,Chief, Administrative Information Branch.[FR Doc. 95–2095 Filed 1–26–95; 8:45 am]BILLING CODE 8025–01–M

Reporting and RecordkeepingRequirements Under OMB Review

ACTION: Notice of reporting requirementssubmitted for review.

SUMMARY: Under the provisions of thePaperwork Reduction Act (44 U.S.C.Chapter 35), agencies are required tosubmit proposed reporting andrecordkeeping requirements to OMB forreview and approval, and to publish anotice in the Federal Register notifyingthe public that the agency has madesuch a submission.DATES: Comments should be submittedon or before February 27, 1995. If youintend to comment but cannot preparecomments promptly, please advise theOMB Reviewer and the AgencyClearance Officer before the deadline.COPIES: Request for clearance (S.F. 83),supporting statement, and otherdocuments submitted to OMB forreview may be obtained from theAgency Clearance Officer. Submitcomments to the Agency ClearanceOfficer and the OMB Reviewer.

FOR FURTHER INFORMATION CONTACT:

Agency Clearance Officer: CleoVerbillis, Small BusinessAdministration, 409 3rd Street, SW.,


5th Floor, Washington, DC 20416,telephone: (202) 205–6629.

OMB Reviewer: Donald Arbuckle, Officeof Information and Regulatory Affairs,Office of Management and Budget,New Executive Office Building,Washington, DC 20503.

Title: Portfolio Financial Report.Form No.: SBA Form 1031.Frequency: On Occasion.Description of Respondents: Small

Business Investment Companies.Annual Responses: 2,100.Annual Burden: 420.

Dated: December 20, 1994.Cleo Verbillis,Chief, Administrative Information Branch.[FR Doc. 95–2094 Filed 1–26–95; 8:45 am]BILLING CODE 8025–01–M

Wood River Capital Corporation;Notice of License Surrender

[License #02/02–0361]

Notice is hereby given that WoodRiver Capital Corporation (‘‘WRCC’’),667 Madison Avenue, New York, NewYork 20021, has surrendered its licenseto operate as a small businessinvestment company under the SmallBusiness Investment Act of 1958, asamended (‘‘the Act’’). WRCC waslicensed by the Small BusinessAdministration on May 5, 1976.

Under the authority vested by the Actand pursuant to the regulationspromulgated thereunder, the surrenderof the license was accepted onDecember 24, 1994, and accordingly, allrights, privileges, and franchises derivedtherefrom have been terminated.(Catalog of Federal Domestic AssistanceProgram No. 59.011, Small BusinessInvestment Companies)

Dated: January 23, 1995.Robert D. Stillman,Associate Administrator for Investment.[FR Doc. 95–2096 Filed 1–26–95; 8:45 am]BILLING CODE 8025–01–M


Coast Guard

[CGD 95–004]

Differential Global Positioning System,Atlantic Intercoastal Region;Environmental Assessment

AGENCY: Coast Guard, DOT.ACTION: Notice of availability.

SUMMARY: The Coast Guard has prepareda Programmatic EnvironmentalAssessment (EA) and Finding of NoSignificant Impact (FONSI) for

implementing a Differential GlobalPositioning System (DGPS) Service inthe Atlantic Intercoastal Region of theUnited States. The EA concluded thatthere will be no significant impact onthe environment and that preparation ofan Environmental Impact Statement willnot be necessary. This notice announcesthe availability of the EA and FONSIand solicits comments on them.DATES: Comments must be received onor before February 27, 1995.ADDRESSES: Comments may be mailed tothe Executive Secretary, Marine SafetyCouncil, U.S. Coast Guard Headquarters,2100 Second Street SW., Washington,DC 20593–0001, or may be delivered toroom 3406 at the same address between8 a.m. and 3 p.m., Monday throughFriday, except Federal holidays. Thetelephone number is (202) 267–1477.

Copies of the EA and FONSI may beobtained by contacting LCDR GeorgePrivon at (202) 267–0297 or faxing arequest at (202) 267–4427. A copy of theEA (less enclosures) is also available onthe Electronic Bulletin Board System(BBS) at the Navigation InformationCenter (NIC) in Alexandria, VA, (703)313–5910. For information on the BBS,call the NIC watchstander at (703) 313–5900.FOR FURTHER INFORMATION CONTACT:LCDR George Privon, RadionavigationDivision, (202) 267–0297.SUPPLEMENTARY INFORMATION:

Request for Comments

Copies of the ProgrammaticEnvironmental Assessment (EA) andFinding of No Significant Impact(FONSI) are available as describedunder ADDRESSES. The Coast Guardencourages interested persons tocomment on these documents. TheCoast Guard may revise thesedocuments in view of the comments. Ifrevisions are warranted, availability ofthe revised documents will beannounced by a later notice in theFederal Register.

Background

As required by Congress, the CoastGuard is preparing to install theequipment necessary to implement aDifferential Global Positioning System(DGPS) service in the AtlanticIntercoastal Corridor area of the UnitedStates. DGPS is a new radionavigationservice that improves upon the 100meter accuracy of the existing GlobalPositioning System (GPS) to provide anaccuracy of better than 10 meters. Forvessels, this degree of accuracy iscritical for precise electronic navigationin harbors and harbor approaches andwill reduce the number of vessel

groundings, collisions, personalinjuries, fatalities, and potentialhazardous cargo spills resulting fromsuch incidents.

After extensive study, the Coast Guardhas selected five sites along the AtlanticIntercoastal Corridor coastline for theDGPS equipment. The sites are in thevicinity of Charleston, SC; Cape Henry,VA; Fort Macon, NC; Cape Canaveral,FL; and Miami, FL. The sites are alreadyused for related purposes and werechosen, in part, because their proposeduse is consistent with their past andpresent use, thus minimizing furtherimpact on the environment. DGPSsignal transmissions will be broadcast inthe marine radiobeacon frequency band(283.5 to 325 KHz) using less than 50watts (effective radiated power). Signaltransmissions at these low frequencyand power levels have not been foundto be harmful to the surroundingenvironment.

Proposed Installations at Each Site(a) Radiobeacon Antenna—The Coast

Guard proposes to use an existingantenna or install a 90 foot guyedantenna with an accompanying groundplane for sites as follows:At Cape Henry, VA, the existing antenna

and ground plane will be used.At Miami, FL, the existing 74 foot

antenna and ground plane will beused.

At Cape Canaveral, FL, the existingground plane will need to beupgraded and the 74 foot antenna willbe replaced with a 90 foot model atthe same location.

At Fort Macon, NC, and Charleston, SCthe existing antenna and ground planewill be used.

A ground plane for these antennasconsists of approximately 120 copperradials (6 gauge copper wire) installed 6inches (or less) beneath the soil andprojecting outward from the antennabase. The optimum radial length is 300feet, but this length may be shortened tofit within property boundaries.Wherever possible, a very effective cableplow method will be utilized in theradial installation to minimize soildisturbance. Installation of the groundplane may first require some clearing oftrees and bushes.

(b) DGPS Antennas—Each site willrequire two 10 foot masts to supportfour small (4 inches by 18 inchesdiameter) receiving antennas. The mastswill be installed on concretefoundations. These masts are needed tosupport the primary and backupreference receivers and integritymonitors. The location of the two mastswill be in the vicinity of the electronicequipment building or hut, but at least


50 feet to 100 feet from existingstructures.

(c) Equipment shelter—DGPStransmitting equipment will be housedin existing equipment facilities with thepossible exception of Fort Macon, NC,which may require upgrading thestructure to hold the additionalelectronic equipment.

(d) Utilities—The Coast Guardproposes to use available commercialpower as the primary source for theelectronic equipment. A telephone linewill be required at each site to allow forremote monitoring and operation.

Description of Each Site

Charleston, SC—The site is co-locatedat the Charleston Light Station, which ison Sullivans island.

Cape Canaveral, FL—Locatedapproximately 10 miles Northeast ofCocoa Beach on the Cape Canaveral AirForce Station.

Miami, FL—Located approximately12 miles Northeast of Coral Gables onthe Virginia Key island.

Cape Henry, VA—This site is locatedon the Fort Story Military Reservation,which is adjacent to the Cape HenryLight. The light is listed on the NationalRegister. The Coast Guard and VASHPO agree the proposed project willhave no adverse effect on the historicproperty. The radiobeacon equipmenthas already been partially upgraded andis transmitting prototype DGPS signalsfor test and evaluation purposes.

Fort Macon, NC—The site is co-located at the USCG Base Fort Macon,which is near the historic Fort Macon.The Coast Guard and NC SHPO agreethat the proposed project will have noadverse effect on the historic property.

Implementation of a DGPS service inthe Atlantic Intercoastal Regional isdetermined to have no significant effecton the quality of the humanenvironment or require preparation ofan Environmental Impact Statement.

Dated: January 19, 1995.G.A. Penington,Rear Admiral, U.S. Coast Guard Chief, Officeof Navigation Safety and Waterway Services.[FR Doc. 95–2093 Filed 1–26–95; 8:45 am]BILLING CODE 4910–14–M

[CGD 95–006]

Discontinuance of Coast Guard HighFrequency Morse RadiotelegraphyServices

AGENCY: Coast Guard, DOT.ACTION: Notice of intent.

SUMMARY: the Coast guard intends todiscontinue all high frequency Morse

(HFCW) radiotelegraph services. Moreeffective means of communication arenow in use, and vessels in maritimeareas over which the United Statesexercises responsibility for search andrescue no longer rely on HFCWradiotelegraphy as a primary means ofcommunication.DATES: All Coast Guard HFCWradiotelegraphy services will bediscontinued on April 1, 1995.FOR FURTHER INFORMATION CONTACT:Lieutenant Adolph Keyes, Chief,Telecommunications Policy Section (G–TTM), Office of Command, Control andCommunication, U.S. Coast Guard, 2100Second Street SW., Washington, DC20593–0001, telephone (202) 267–6598,telefax (202) 267–4617, or telex 892427(COASTGUARD WASH). Normal officehours are between 7 a.m. and 3:30 p.m.(EST), Monday through Friday, exceptholidays.SUPPLEMENTARY INFORMATION: Since1959, the Coast Guard has used highfrequency Morse radiotelegraphy(HFCW) to communicate withgovernment and merchant ships,primarily to broadcast safety, warningsand navigation information, receiveposition and meteorological reportsfrom ships, and to communicate withships at sea reporting a distress alert ormedical or vessel emergency.

The Global Maritime Distress andSafety System (GMDSS) amendments tothe Safety of Life at Sea (SOLAS)Convention were adopted in 1988 andinitial provisions entered into force inFebruary, 1992. GMDSS methodsprovide the mariner with improvedmeans for initiating or relaying distressalerts, and receiving safety informationpertinent to its area of operation.Components of the GMDSS nowavailable include navigational telex(NAVTEX), simplex teletype over radio(SITOR), emergency position indicatingradio beacons (EPIRB), search andrescue radar transponders (SARTS) andInternational Maritime Satellite(INMARSAT). NAVTEX, SITOR andINMARSAT’s SafetyNet provide themariner with the same components ofinformation the Coast Guard currentlybroadcasts over high frequency Morse(HFCW) radiotelegraphy. Governmentand merchant vessels no longer rely onhigh frequency Morse (HFCW)radiotelegraphy as their primary meansof safety radiocommunications whenoperating within maritime areas, wherethe United States exercisesresponsibility for search and rescue andnavigational safety.

U.S. commercial coast radio stationsprovide adequate radio frequency andtime of day coverage of maritime areas

to ensure a high probability of receptionof distress and safety alerts. Provisionsexist under the Communications Act forprompt processing of distress and safetymessages and forwarding to theappropriate U.S. Coast Guard rescuecoordination center.

The U.S. Coast guard will continue toprovide HF SITOR service fromCommunication Stations Kodiak (NOJ),Honolulu (NMO), and Guam (NRV), andCommunications Area Master StationsSan Francisco (NMC) and Portsmouth(NMN). Additionally, government andmerchant vessels can contact designatedcommercial coast radio stations onHFCW to pass safety, medicalemergency and Automated-MutualAssistance Vessel Rescue (AMVER)reports to the Coast Guard at no cost tothe originator. More informationconcerning Coast Guard distress andsafety radio circuits can be obtainedfrom the Coast Guard NavigationInformation Service computer bulletinboard, accessible by modem at (703)313–5910, or by Internet from ‘Telnetfedworld.gov’.

The Coast Guard believes the currentimplemented provisions of GMDSS andcommercial coast radio station operatingMorse telegraphy services (HFCW)within the high frequency bands aresufficient to ensure distress and safetycommunication services. Therefore,effective 1 April 1995, the Coast Guardproposes to cease all high frequencyMorse (HFCW) radiotelegraphy servicescurrently operated from Coast GuardCommunication Stations Kodiak,Honolulu, and Guam, andCommunications Area Master StationsSan Francisco and Portsmouth.

Dated: January 13, 1995.D.E. Ciancaglini,Rear Admiral, U.S. Coast Guard, Chief, Officeof Command, Control and Communications.[FR Doc. 95–2092 Filed 1–26–95; 8:45 am]BILLING CODE 4910–14–M

[CGD 95–005]

Area To Be Avoided Off theWashington Coast

AGENCY: Coast Guard, DOT.ACTION: Notice of meeting; request forcomments.

SUMMARY: The Coast Guard will conducta public meeting to obtain informationon whether the applicability of an areato be avoided (ATBA) off theWashington Coast should be expandedto include vessels and barges other thanthose carrying cargoes of oil orhazardous materials.


DATES: The meeting will be heldFebruary 23, 1995, from 9:00 a.m. untilthe last speaker is heard. Writtencomments must be received not laterthan March 3, 1995.ADDRESSES: The meeting will be held inthe North Auditorium on the fourthfloor of the Federal Building, 915Second Avenue, Seattle, WA 98174.Written comments may be mailed to theExecutive Secretary, Marine SafetyCouncil (G–LRA), U.S. Coast Guard,2100 Second Street SW, Washington,DC 20593–0001, or may be delivered toroom 3406 at the same address between8 a.m. and 3 p.m., Monday throughFriday, except Federal holidays.Comments will become part of thisdocket and will be available forinspection or copying at room 3406,Coast Guard Headquarters, between 8a.m. and 3 p.m., Monday, throughFriday, except Federal holidays.FOR FURTHER INFORMATION CONTACT:Ms. Margie G. Hegy, Project Manager,Vessel Traffic Services Division, phone(202) 267–0415. This telephone isequipped to take messages on a 24-hourbasis.SUPPLEMENTARY INFORMATION: An ATBAis a defined area that all ships or certainclasses of ships are encouraged to avoidbecause navigation is particularlyhazardous or it is exceptionallyimportant to avoid casualties within thearea. On December 7, 1994, theMaritime Safety Committee of theInternational Maritime Organizationadopted an ATBA proposed by the U.S.off the Washington coast in the vicinityof the Olympic Coast National MarineSanctuary. The ATBA will go into effecton June 7, 1995.

In order to reduce the risk of marinecasualty and resulting pollution anddamage to the environment of theOlympic Coast National MarineSanctuary, all vessels, including barges,carrying cargoes classified by the UnitedStates as hazardous materials (e.g., oil orchemicals) should avoid the areabounded by a line connecting thefollowing points:

Latitude Longitude

(1) 48°23.3′N .......................... 124°38.2′ W(2) 48°23.5′N .......................... 124°38.2′ W(3) 48°25.3′N .......................... 124°46.9′ W(4) 47°51.7′N .......................... 125°15.5′ W(5) 47°07.7′N .......................... 124°47.5′ W(6) 47°07.7′N .......................... 124°11.0′ W

Because of concerns raised shortlybefore IMO considered the U.S.proposal, the U.S. delegation informedthe Committee that the issue ofspending this ATBA to include othercategories of commercial vessels would

be considered further at the nationallevel and, if appropriate, an amendmentwould be submitted for IMOconsideration. This meeting will givethe public an opportunity to provideinformation and documentation as wereconsider this issue.

In addition to information you wish toprovide, the Coast Guard is alsointerested in your response to thefollowing questions:1. What interest or industry group do

you represent?2. If an Agent, do you represent U.S. or

foreign flag vessels?3. Do you currently own, operate, or

charter commercial vessels that haveoccasion to operate within the MarineSanctuary? If yes, please describenumber, type, length, gross tons,amounts of bunker fuel carried, andtype/quantity of cargo.

4. What measure (e.g., length, grosstonnage, barrels of product and/orbunker carried) do you recommend beused to establish applicability for theATBA? Why?

5. Are there products/cargo other thanpetroleum that should be included inthe applicability? If so, why and howshould they be classified/identified?What threat do they pose to thesanctuary resources?

6. It has been suggested that theapplicability of the ATBA beexpanded to include all vesselsgreater than 500 gross tons regardlessof the quantity or type of cargocarried. What impact (e.g., economic,extra steaming time, safety) wouldthis have on your business/industry?

7. If you have a specific proposal toexpand the applicability, quantify thebenefit to the environment that wouldresult. What is your proposal basedon? Why should these vessels beincluded?

8. How many vessels (or vessel transits)per year are potentially affected by thecurrent ATBA applicability? Howmany by expanding the applicabilityto include the vessels as suggested innumber 6 or 7 above?

9. Prior to creation of the ATBA, wherehave your vessels historicallytransited during coastal transits (i.e.,how many miles offshore)? If you callon a coastal port within theSanctuary, describe your approach/track line to the port.

10. Are there industry or companypolicies which establish vesselroutes? If so, what are they?Attendance is open to the public.

With advance notice, and as timepermits, members of the public maymake oral presentations during themeeting. Persons wishing to make oral

presentations should notify the personlisted above under FOR FURTHERINFORMATION CONTACT no later than twodays before the meeting. Writtenmaterial may be submitted prior to,during, or after the meeting.

Dated: January 23, 1995.G.A. Penington,Rear Admiral, U.S. Coast Guard Chief, Officeof Navigation Safety and Waterway Services.[FR Doc. 95–2091 Filed 1–26–95; 8:45 am]BILLING CODE 4910–14–M


[Docket No. 94–93; Notice 2]

Decision That Nonconforming 1992Mercedes-Benz 260E Passenger Carsare Eligible for Importation

AGENCY: National Highway TrafficSafety Administration (NHTSA), DOT.ACTION: Notice of decision by NHTSAthat nonconforming 1992 Mercedes-Benz 260E passenger cars are eligible forimportation.

SUMMARY: This notice announces thedecision by NHTSA that 1992Mercedes-Benz 260E 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 1992 Mercedes-Benz 300E), andthey are capable of being readily alteredto conform to the standards.DATES: The decision is effective onJanuary 27, 1995.FOR FURTHER INFORMATION CONTACT:Ted Bayler, Office of Vehicle SafetyCompliance, NHTSA (202–366–5306).SUPPLEMENTARY INFORMATION: 1992Mercedes-Benz 300E.

BackgroundUnder 49 U.S.C. 30141(a)(1)(A)

(formerly section 108(c)(3)(A)(i) of theNational Traffic and Motor VehicleSafety Act (the Act)), a motor vehiclethat was not originally manufactured toconform to all applicable Federal motorvehicle safety standards shall be refusedadmission into the United States unlessNHTSA has decided that the motorvehicle is substantially similar to amotor vehicle originally manufacturedfor importation into and sale in theUnited States, certified under 49 U.S.C.30115 (formerly section 114 of the Act),and of the same model year as the


model of the motor vehicle to becompared, and is capable of beingreadily altered to conform to allapplicable Federal motor vehicle safetystandards.

Petitions for eligibility decisions maybe submitted by either manufacturers orimporters who have registered withNHTSA pursuant to 49 CFR Part 592. Asspecified in 49 CFR 593.7, NHTSApublishes notice in the Federal Registerof each petition that it receives, andaffords interested persons anopportunity to comment on the petition.At the close of the comment period,NHTSA decides, on the basis of thepetition and any comments that it hasreceived, whether the vehicle is eligiblefor importation. The agency thenpublishes this decision in the FederalRegister.

Champagne Imports, Inc. of Lansdale,Pennsylvania (Registered Importer R–90–009) petitioned NHTSA to decidewhether 1992 Mercedes-Benz 260Epassenger cars are eligible forimportation into the United States.NHTSA published notice of the petitionon December 6, 1994 (59 FR 62778) toafford an opportunity for publiccomment. The reader is referred to thatnotice for a thorough description of thepetition. No comments were received inresponse to the notice. Based on itsreview of the information submitted bythe petitioner, NHTSA has decided togrant the petition.

Vehicle Eligibility Number for SubjectVehicles

The importer of a vehicle admissibleunder any final decision must indicateon the form HS–7 accompanying entrythe appropriate vehicle eligibilitynumber indicating that the vehicle iseligible for entry. VSP 105 is the vehicleeligibility number assigned to vehiclesadmissible under this notice of finaldecision.

Final Decision

Accordingly, on the basis of theforegoing, NHTSA hereby decides that a1992 Mercedes-Benz 260E (Model ID124.026) is substantially similar to a1992 Mercedes-Benz 300E originallymanufactured for importation into andsale in the United States and certifiedunder 49 U.S.C. 30115, and is capableof being readily altered to conform to allapplicable Federal motor vehicle safetystandards.

Authority: 49 U.S.C. 30141(a)(1)(A) and(b)(1); 49 CFR 593.8; delegations of authorityat 49 CFR 1.50 and 501.8.

Issued on: January 23, 1995.William A. Boehly,Associate Administrator for Enforcement.[FR Doc. 95–2064 Filed 1–26–95; 8:45 am]BILLING CODE 4910–59–M

DEPARTMENT OF THE TREASURY

Public Information CollectionRequirements Submitted to OMB forReview

January 18, 1995.The Department of Treasury has

submitted the following publicinformation collection requirement(s) toOMB for review and clearance under thePaperwork Reduction Act of 1980,Public Law 96–511. Copies of thesubmission(s) may be obtained bycalling the Treasury Bureau ClearanceOfficer listed. Comments regarding thisinformation collection should beaddressed to the OMB reviewer listedand to the Treasury DepartmentClearance Officer, Department of theTreasury, Room 2110, 1425 New YorkAvenue, NW., Washington, DC 20220.

Bureau of the Public Debt (BPD)

OMB Number: 1535–0111.Form Number: SBD 2090.Type of Review: Extension.Title: Authorization for Purchase and

Request for Change United StatesSeries EE Savings Bonds.

Description: This form is used toauthorize employers to allot fundsfrom employees’ pay for the purchaseof Savings Bonds.

Respondents: Individuals orhouseholds, State or localgovernments, Businesses or other for-profit, Federal agencies or employees,Non-profit institutions, Smallbusinesses or organizations.

Estimated Number of Respondents:1,600,000.

Estimated Burden Hours Per Response:7 minutes, 30 seconds.

Frequency of Response: On occasion.Estimated Total Reporting Burden:

33,333 hours.Clearance Officer: Vicki S. Ott, (304)

480–6553, Bureau of the Public Debt,200 Third Street, Parkersburg, WestVA 26106–1328.

OMB Reviewer: Milo Sunderhauf, (202)395–7340, Office of Management andBudget, Room 10226, New ExecutiveOffice Building, Washington, DC20503.

Lois K. Holland,Departmental Reports Management Officer.[FR Doc. 95–2028 Filed 1–26–95; 8:45 am]BILLING CODE 4810–40–P

Public Information CollectionRequirements Submitted to OMB forReview

January 18, 1995.The Department of Treasury has

submitted the following publicinformation collection requirement(s) toOMB for review and clearance under thePaperwork Reduction Act of 1980,Public Law 96–511. Copies of thesubmission(s) may be obtained bycalling the Treasury Bureau ClearanceOfficer listed. Comments regarding thisinformation collection should beaddressed to the OMB reviewer listedand to the Treasury DepartmentClearance Officer, Department of theTreasury, Room 2110, 1425 New YorkAvenue, NW., Washington, DC 20220.

Internal Revenue Service (IRS)

OMB Number: 1545–0135.Form Number: IRS Form 1138.Type of Review: Extension.Title: Extension of Time for Payment of

Taxes by a Corporation Expecting aNet Operating Loss Carryback.

Description: Form 1138 is filed bycorporations to request an extensionof time to pay their income taxes,including estimated taxes.Corporations may only file for anextension when they expect a netoperating loss carryback in the taxyear and want to delay the paymentof taxes from a prior tax year.

Respondents: Businesses or other for-profit.

Estimated Number of Respondents/Recordkeepers: 2,033.

Estimated Burden Hours PerRespondent/Recordkeeper:Recordkeeping—3 hr., 21 min.Learning about the law or the form—

35 min.Preparing and sending the form to the

IRS—41 min.Frequency of Response: On occasion.Estimated Total Reporting/

Recordkeeping Burden: 9,392 hours.OMB Number: 1545–0906.Form Number: IRS Form 8362.Type of Review: Revision.Title: Currency Transaction Report by

Casinos.Description: Casinos have to report

currency transactions of more than$10,000 within 15 days of thetransaction. A casino is defined as onelicensed by a State or localgovernment having gross annualgaming revenue in excess of$1,000,000.

Respondents: Businesses or other for-profit.

Estimated Number of Respondents/Recordkeepers: 30,000.


Estimated Burden Hours PerRespondent/Recordkeeper: 47minutes.

Frequency of Response: On occasion.Estimated Total Reporting/

Recordkeeping Burden: 18,360 hours.OMB Number: 1545–1163.Form Number: IRS Form 8822.Type of Review: Extension.Title: Change of Address.Description: Form 8822 is used by

taxpayers to inform IRS of theirchange of address. IRS will use thisinformation to update the taxpayer’saddress of record.

Respondents: Individuals orhouseholds, Businesses of other for-profit, Not-for-profit institutions,Farms, Federal Government, State,Local or Tribal Governments.

Estimated Number of Respondents/Recordkeepers: 1,500,000.

Estimated Burden Hours PerRespondent/Recordkeeper: 16minutes.

Frequency of Response: On occasion.Estimated Total Reporting/

Recordkeeping Burden: 387,501hours.

Clearance Officer: Garrick Shear, (202)622–3869, Internal Revenue Service,Room 5571, 1111 ConstitutionAvenue, NW., Washington, DC 20224.

OMB Reviewer: Milo Sunderhauf, (202)395–7340, Office of Management andBudget, Room 10226, New ExecutiveOffice Building, Washington, DC20503.

Lois K. Holland,Departmental Reports Management Officer.[FR Doc. 95–2029 Filed 1–26–95; 8:45 am]BILLING CODE 4830–01–P

Customs Service

[ADM–9–03:CO:R:IT:R 912545 FF]

Filing of Contracts and CertificationsCovering Textile and Apparel ProductsUnder Section 334 of the UruguayRound Agreements Act

AGENCY: U.S. Customs Service,Department of the Treasury.ACTION: General notice.

SUMMARY: This document advises thepublic of the requirements andprocedures that must be followed infiling contracts and certifications withCustoms in order to precludeapplication of new origin principles totextile and apparel products entered, orwithdrawn from warehouse, forconsumption during the period of July1, 1996 through January 1, 1998, asprovided in section 334 of the UruguayRound Agreements Act (the Act). If acontract and certification are not filed

with Customs in accordance with theprocedures set forth in this document,such textile and apparel products willbe subject to the origin principlescontained in section 334(b) of the Act.DATES: Contracts and certifications mustbe filed with Customs on or beforeFebruary 6, 1995.ADDRESSES: Contracts and certificationsmust be filed with the Director, Officeof Trade Operations, Attention: LisaCrosby, Room 1325, U.S. CustomsService, 1301 Constitution Avenue,N.W., Washington, D.C. 20229.FOR FURTHER INFORMATION CONTACT: LisaCrosby, Office of Trade Operations(202–927–0163).


BackgroundOn December 8, 1994, President

Clinton signed into law the UruguayRound Agreements Act (the Act), PublicLaw 103–465, 108 Stat. 4809. Subtitle Dof Title III of the Act deals with textilesand includes section 334 whichconcerns rules of origin for textile andapparel products.

Paragraph (a) of section 334 providesthat the Secretary of the Treasury shallprescribe rules implementing theprinciples contained in paragraph (b) fordetermining the origin of textiles andapparel products. Paragraph (a) furtherprovides that such rules must bepromulgated in final form not later thanJuly 1, 1995.

Paragraph (b) of section 334incorporates the following provisions:(1) General rules for determining when,for purposes of the customs laws andthe administration of quantitativerestrictions, a textile or apparel productoriginates in a country, territory, orinsular possession, and is the growth,product, or manufacture of that country,territory, or insular possession; (2)special origin rules for certain identifiedgoods; (3) a multicountry rule fordetermining origin when the origin of agood cannot be determined under thepreceding provisions of paragraph (b);(4) special rules governing the treatmentof components which are cut to shapein the United States from foreign fabricor are products of the United States andwhich are exported for assembly andreturned to the United States; and (5) anexception to the application of section334 in the case of the United States-Israel Free Trade Agreement, whichspecifically provides for the continuedapplication of the rulings andadministrative practices that wereapplied, immediately before theenactment of the Act, to determine theorigin of textile and apparel productscovered by that Agreement, unless such

rulings and practices are modified bythe mutual consent of the United Statesand Israel.

Paragraph (c) of section 334 providesthat section 334 shall apply to goodsentered, or withdrawn from warehouse,for consumption on or after July 1, 1996.However, paragraph (c) further providesthat section 334 shall not apply to goodsif:

(1) The contract for the sale of suchgoods to the United States is enteredinto before July 20, 1994;

(2) All of the material terms of sale insuch contract, including the price andquantity of the goods, are fixed anddeterminable before July 20, 1994;

(3) A copy of the contract is filed withthe Commissioner of Customs within 60days after the date of the enactment ofthe Act, together with a certification thatthe contract meets the requirements ofparagraphs (1) and (2) above; and

(4) The goods are entered, orwithdrawn from warehouse, forconsumption on or before January 1,1998.

Paragraph (c) was included in section334 in recognition of the fact thatapplication of the origin principlescontained in paragraph (b) may result inorigin determinations that are differentfrom the result that would have beenreached under prior law andadministrative practice, thus causingundue hardship to persons who hadalready entered into binding contractsbased on existing law andadministrative practice.

Since the required rulesimplementing the principles ofparagraph (b) of section 334 arecurrently at the pre-publication stageand thus are not available for reference,members of the public must refer to theprovisions as contained in paragraph (b)of the statute in order to assess the needfor filing a contract and certificationwith Customs as provided for inparagraph (c). The proceduresapplicable to the filing of such contractsand certifications are set forth below.

Procedures for Filing Contracts andCertifications

A legible and complete copy of eachcontract, together with the requiredcertification signed by the U.S. party tothe contract or authorized officer oragent thereof, must be filed with theDirector, Office of Trade Operations,Attention: Lisa Crosby, Room 1325, U.S.Customs Service, 1301 ConstitutionAvenue, N.W., Washington, D.C. 20229,on or before February 6, 1995. Customswill provide written confirmation ofeach timely filing within five workingdays of the date of receipt of the fileddocuments. Contracts and certifications


which are submitted by mail or courierservice and which are received byCustoms after February 6, 1995, will notbe considered to have been timely filedunless they reflect a postmark or otherdate of transmission of February 6,1995, or earlier. If a contract andcertification which otherwise meet theterms of section 334(c) of the Act are notfiled with Customs in accordance withthe procedures set forth herein, thetextile and apparel products covered by

the contract will be subject to the originprinciples contained in section 334(b) ofthe Act.

Following review of each contract andcertification, Customs will determinewhether the filed documents meet therequirements of paragraph (c) of section334 and will provide written notice tothe filing party regarding thatdetermination. A separate notice will bepublished at an appropriate future dateregarding the entry or other procedures

to be followed for the period of July 1,1996 through January 1, 1998, in thecase of goods covered by contractsfound by Customs to meet therequirements of paragraph (c) of section334.

Dated: January 24, 1995.A.W. Tennant,Acting Assistant Commissioner, Office ofField Operations[FR Doc. 95–2140 Filed 1–24–95; 4:34 pm]BILLING CODE 4820–02–P

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).

Sunshine Act Meetings Federal Register

5459

Vol. 60, No. 18


COMMODITY FUTURES TRADING COMMISSION

TIME AND DATE: 11:00 a.m., Friday,February 3, 1995.PLACE: 2033 K St., NW., Washington,DC, 8th Floor Hearing Room.STATUS: Closed.MATTERS TO BE CONSIDERED: SurveillanceMatters.CONTACT PERSON FOR MORE INFORMATION:Jean A. Webb, 202–254–6314.Jean A. Webb,Secretary of the Commission.[FR Doc. 95–2159 Filed 1–25–95; 10:49 am]BILLING CODE 6351–01–M


TIME AND DATE: 11:00 a.m., Friday,February 10, 1995.PLACE: 2033 K St., NW., Washington,DC, 8th Floor Hearing Room.STATUS: Closed.MATTERS TO BE CONSIDERED: Surveillancematters.CONTACT PERSON FOR MORE INFORMATION:Jean A. Webb, 202–254–6314.Jean A. Webb,Secretary of the Commission.[FR Doc. 95–2160 Filed 1–25–95; 10:49 am]BILLING CODE 6351–01–M


TIME AND DATE: 11:00 a.m., Friday,February 17, 1995.PLACE: 2033 K St., NW., Washington,DC, 8th Floor Hearing Room.STATUS: Closed.MATTERS TO BE CONSIDERED: SurveillanceMatters.CONTACT PERSON FOR MORE INFORMATION:Jean A. Webb, 202–254–6314.Jean A. Webb,Secretary of the Commission.[FR Doc. 95–2161 Filed 1–25–95; 10:49 am]BILLING CODE 6351–01–M


TIME AND DATE: 11 a.m., Friday, February24, 1995.PLACE: 2033 K St., NW., Washington,DC, 8th Floor Hearing Room.

STATUS: Closed.MATTERS TO BE CONSIDERED: SurveillanceMatters.CONTACT PERSON FOR MORE INFORMATION:Jean A. Webb, 202–254–6314.Jean A Webb,Secretary of the Commission.[FR Doc. 95–2162 Filed 1–25–95; 10:49 am]BILLING CODE 6351–01–M

FARM CREDIT ADMINISTRATION

Farm Credit Administration Board;Amendment to Sunshine Act MeetingSUMMARY: Pursuant to the Governmentin the Sunshine Act (5 U.S.C.552b(e)(3)), the Farm CreditAdministration gave notice on January10, 1995 (60 FR 2625) of the regularmeeting of the Farm CreditAdministration Board (Board)scheduled for January 12, 1995. Thisnotice is to amend the agenda byremoving an item from the open sessionof that meeting.FOR FURTHER INFORMATION CONTACT:Floyd Fithian, Acting Secretary to theFarm Credit Administration Board,(703) 883–4025, TDD (703) 883–4444.ADDRESSES: Farm CreditAdministration, 1501 Farm Credit Drive,McLean, Virginia 22102–5090.SUPPLEMENTARY INFORMATION: Thismeeting of the Board was open to thepublic (limited space available). Theopen session of the agenda for January12, 1995, is amended as follows:

Open Session

B. Reports

1. COO’s First Quarter FY 1995 Report

a. Derivatives Workgroup Report.b. Capital Workgroup Report.Dated: January 23, 1995.

Floyd Fithian,Acting Secretary, Farm Credit AdministrationBoard.[FR Doc. 95–2251 Filed 1–25–95; 2:59 am]BILLING CODE 6705–01–P

FEDERAL DEPOSIT INSURANCECORPORATION

Notice of Agency MeetingPursuant to the provisions of the

‘‘Government in the Sunshine Act’’ (5U.S.C. 552b), notice is hereby given thatat 10:05 a.m. on Tuesday, January 24,1995, the Board of Directors of theFederal Deposit Insurance Corporation

met in closed session to considermatters relating to the Corporation’scorporate and supervisory activities.

In calling the meeting, the Boarddetermined, on motion of ViceChairman Andrew C. Hove, Jr.,seconded by Director Jonathan L.Fiechter (Acting Director, Office ofThrift Supervision), concurred in byDirector Eugene A. Ludwig (Comptrollerof the Currency), and Chairman RickiTigert Helfer, that Corporation businessrequired its consideration of the matterson less than seven days’ notice to thepublic; that no earlier notice of themeeting was practicable; that the publicinterest did not require consideration ofthe matters in a meeting open to publicobservation; and that the matters couldbe considered in a closed meeting byauthority of subsections (c)(4), (c)(6),(c)(8), (c)(9)(A)(ii), (c)(9)(B), and (c)(10)of the ‘‘Government in the SunshineAct’’ (5 U.S.C. 552b (c)(4), (c)(6), (c)(8),(c)(9)(A)(ii), (c)(9)(B), and (c)(10)).

The meeting was held in the BoardRoom of the FDIC Building located at550 17th Street, NW., Washington, DC.

Dated: January 24, 1995.Federal Deposit Insurance Corporation.Leneta G. Gregorie,Acting Assistant Executive Secretary.[FR Doc. 95–2155 Filed 1–25–94; 10:19 am]BILLING CODE 6714–0–M

FEDERAL DEPOSIT INSURANCECORPORATION

Notice of Agency Meeting

Pursuant to the provisions of the‘‘Government in the Sunshine Act’’ (5U.S.C. 552b), notice is hereby given thatthe Federal Deposit InsuranceCorporation’s Board of Directors willmeet in open session at 10:00 a.m. onTuesday, January 31, 1995, to considerthe following matters:

Summary Agenda

No substantive discussion of thefollowing items is anticipated. Thesematters will be resolved with a singlevote unless a member of the Board ofDirectors requests that an item bemoved to the discussion agenda.

Disposition of minutes of previousmeetings.

Reports of actions approved by thestanding committees of the Corporation andby officers of the Corporation pursuant toauthority delegated by the Board of Directors.

5460 Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Sunshine Act Meetings

Memorandum and resolution re:Amendments to an Existing Privacy ActSystem of Records (Consumer Complaint andInquiry System), which would updatelanguage describing the system location,categories of records in the system, etc.,necessitated by a recent reorganizationwithin the Corporation; and a proposal forthe delegation of authority to the ExecutiveSecretary to authorize minor amendments toexisting Privacy Act systems of records.

Memorandum and resolution re:Establishment of a New System of Records(Unclaimed Deposits Reporting System)which would consist of records relating tounclaimed insured or transferred depositsfrom closed insured depository institutionsfor which the Corporation was appointedreceiver after January 1, 1989.

Memorandum re: January 1995 FundingRequest: Financing Corporation (FICO)Assessment.

Discussion AgendaMemorandum and resolution re: Proposed

amendments to Parts 327 and 304 of theCorporation’s rules and regulations, entitled‘‘Assessments’’ and ‘‘Forms, Instructions, andReports,’’ respectively, which wouldestablish a new assessment rate schedule forBank Insurance Fund members.

Memorandum re: Issuance of a GeneralCounsel Opinion regarding the treatment ofassessments paid by members of the BankInsurance Fund on deposits acquired frommembers of the Savings AssociationInsurance Fund.

Memorandum re: Semiannual review of therecapitalization of the Savings AssociationInsurance Fund and the setting of assessmentrates.

Memorandum and Resolution re: Proposedamendments to Part 363 of the Corporation’srules and regulations, entitled ‘‘AnnualIndependent Audits and ReportingRequirements,’’ in order to conform the rulewith the Riegle Community Developmentand Regulatory Improvement Act of 1994.

Memorandum and resolution re: Proposedamendments to Part 344 of the Corporation’srules and regulations, entitled

‘‘Recordkeeping and ConfirmationRequirements for Securities Transactions,’’which would provide for express waiver ofthe requirement that insured statenonmember banks disclose the amount ofremuneration received in connection withsecurities transactions involving third partybrokerage networking arrangements.

Memorandum and Resolution re: Finalamendment to Part 330 of the Corporation’srules and regulations, entitled ‘‘Disclosure ofCapital Condition,’’ requiring institutions todisclose capital condition to depositors ofemployee benefit plan funds, which affectsthe availability of pass-through insurance foremployee benefit plan deposits, and othertechnical amendments.

Memorandum and Resolution re: Proposedamendments to Part 325 of the Corporation’srules and regulations, entitled ‘‘CapitalMaintenance,’’ which would modify thedefinition of the Organization for EconomicCooperation and Development-based groupof countries.

Memorandum and Resolution re: Finalamendments to Part 325 of the Corporation’srules and regulations, entitled ‘‘CapitalMaintenance,’’ which establish a limitationon the amount of certain deferred tax assetsthat may be included in Tier 1 capital ofinsured state nonmember banks for risk-based and leverage capital purposes.

Memorandum and Resolution re: Notice ofwithdrawal of proposed amendments to Part348 of the Corporation’s rules andregulations, entitled ‘‘Management OfficialInterlocks,’’ which would have createdcertain limited exceptions to the prohibitionon management official interlocks fordepository institutions.

The meeting will be held in the BoardRoom on the sixth floor of the FDICBuilding located at 550—17th Street,N.W., Washington, D.C.

The FDIC will provide attendees withauxiliary aids (e.g., sign languageinterpretation) required for this meeting.Those attendees needing such assistanceshould call (202) 942–3132 (Voice);

(202) 942–3111 (TTY), to makenecessary arrangements.

Request for further informationconcerning the meeting may be directedto Mr. Robert E. Feldman, ActingExecutive Secretary of the Corporation,at (202) 898–6757.

Dated: January 24, 1995.Federal Deposit Insurance Corporation.Robert E. Feldman,Acting Executive Secretary.[FR Doc. 95–2156 Filed 1–25–95; 10:19 am]BILLING CODE 6714–01–M

FEDERAL MINE SAFETY AND HEALTH REVIEWCOMMISSION

TIME AND DATE: 10 a.m., Thursday,January 26, 1995.PLACE: Room 600, 1730 K Street, NW.,Washington, DC.STATUS: Closed [Pursuant to 5 U.S.C.§ 552b(c)(10)].MATTERS TO BE CONSIDERED: TheCommission will consider and act uponthe following:

1. General meeting to determine currentstatus of pending cases.

No earlier announcement of theaddition of this matter to the previouslyscheduled meeting was possible. It wasdetermined by a unanimous vote of theCommissioners that these matters bediscussed in closed session.CONTACT PERSON FOR MORE INFO: JeanEllen, (202) 653–5629/(202) 708–9300for TDD Relay/1–800–877–8339 for tollfree.

Dated: January 23, 1995.Jean H. Ellen,Chief Docket Clerk.[FR Doc. 95–2250 Filed 1–25–95; 2:59 pm]BILLING CODE 6735–01–M

This section of the FEDERAL REGISTERcontains editorial corrections of previouslypublished Presidential, Rule, Proposed Rule,and Notice documents. These corrections areprepared by the Office of the FederalRegister. Agency prepared corrections areissued as signed documents and appear inthe appropriate document categorieselsewhere in the issue.

Corrections Federal Register

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Vol. 60, No. 18



National Oceanic and AtmosphericAdministration

50 CFR Part 658

[Docket No. 940846-4348; I.D. 080194C]

RIN 0648-AF83

Foreign Fishing; Shrimp Fishery of theGulf of Mexico

Correction

In rule document 94–31770 beginningon page 66787, in the issue ofWednesday, December 28, 1994, makethe following corrections:

§658.25 [Corrected]

1.On page 66792, in the third column,in §658.25, in the table, the columnentitled ‘‘W’’ should be a subheadingunder the heading ‘‘Loran Chain 7980’’.

2.On the same page, in the samecolumn, in §658.25, after the table, infootnote 2, ‘‘2 AAAA2 Long Pt.(southwest tip).’’ should read ‘‘2 LongPt. (southwest tip).’’BILLING CODE 1505–01–D


28 CFR Part 36

Nondiscrimination on the Basis ofDisability by Public Accommodationsand in Commercial Facilities

Correction

In the CFR correction appearing onpage 3080 in the issue of Friday, January

13, 1995, the subject heading shouldread as set forth above.

BILLING CODE 1505–01–D


Parole Commission

28 CFR Part 2

Paroling, Recommitting, andSupervising Federal Prisoners:Controlling Drug Abuse by FederalParolees

Correction

In rule document 94–31976 beginningon page 66734 in the issue ofWednesday, December 28, 1994, makethe following corrections:

§ 2.40 [Corrected]

On page 66735, in the first column, inamendatory instruction 2 for § 2.40, inthe second line and in the second lineof the section, the paragraph designation‘‘(R)’’ should read ‘‘(k)’’.



5 CFR Parts 870, 871, 872, 873, 874,and 890

RIN 3206-AF94

Federal Employees’ Group LifeInsurance and Federal EmployeesHealth Benefits Programs;Reconsideration of Employing OfficeEnrollment Decisions

Correction

In rule document 94–31643 beginningon page 66434 in the issue of Tuesday,December 27, 1994, the CFR headingshould appear as set forth above.


SECURITIES AND EXCHANGECOMMISSION

17 CFR Parts 240

[Release No. 34-35123; File No. S7-17-94]RIN 3235-AG15

Proposed Rule Changes of SelfRegulatory Organizations; AnnualFiling of Amendments to RegistrationStatements of National SecuritiesExchanges, Securities Associations,and Reports of the MunicipalSecurities Rulemaking Board

Correction

In rule document 94–31657 beginningon page 66692 in the issue ofWednesday, December 28, 1994, makethe following correction:

§240.6a-2 [Corrected]

On page 66700, in the first column,the heading for amendatory instruction4. should read as set forth above.BILLING CODE 1505–01–D


Coast Guard

33 CFR Part 156

[CGD 93-081]RIN 2115-AE90

Designation of Lightering Zones

Correction

In proposed rule document 95–947beginning on page 3185 in the issue ofFriday, January 13, 1995, make thefollowing correction:

1. On page 3186, in the first column,under SUPPLEMENTARYINFORMATION:, in the first paragraph,in the third line, ‘‘zoned’’ should read‘‘zones’’.

2. On the same page, in the secondcolumn, in the second full paragraph, inthe fourth line, ‘‘June 20,’’ should read‘‘June 30,’’.BILLING CODE 1505–01–D

fede

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egiste

r

5463

FridayJanuary 27, 1995

Part II

EnvironmentalProtection Agency40 CFR Part 437

Centralized Waste Treatment Category,Effluent Limitations Guidelines; ProposedRule

5464 Federal Register / Vol. 60, No. 18 / January, 27, 1995 / Proposed Rules


40 CFR Part 437

[FRL–5126–9]

RIN 2040–AB78

Effluent Limitations Guidelines,Pretreatment Standards, and NewSource Performance Standards:Centralized Waste Treatment Category

AGENCY: Environmental ProtectionAgency (EPA).ACTION: Proposed rule.

SUMMARY: This proposed regulationwould establish technology-based limitsfor the discharge of pollutants intonavigable waters of the United Statesand into publicly-owned treatmentworks by existing and new facilities thatreceive industrial waste from off-site fortreatment or recovery. This regulationwill reduce the discharge of pollutantsby at least 123 million pounds per year,reducing excursions of aquatic life and/or human health toxic effect levels inthirty waterbodies. As a result ofconsultation with stakeholders, thepreamble solicits comments and datanot only on issues raised by EPA, butalso on those raised by State and localgovernments who will be implementingthese regulations and by industryrepresentatives who will be affected bythem.DATES: Comments on the proposal mustbe received by April 27, 1995.

In addition, EPA will conduct aworkshop covering this rulemaking, inconjunction with a public hearing onthe pretreatment standards portion ofthe rule. The workshop will be held onMarch 24, 1995, from 8:30 a.m. to 10:30a.m. The public hearing will beconducted from 11 a.m. to 1 p.m.ADDRESSES: Send comments on thisproposal to Ms. Debra DiCianna,Engineering and Analysis Division(4303), 911 East Tower, U.S. EPA, 401M Street SW, Washington, DC 20460.The public record is in the Water Docketlocated in the basement of the EPAHeadquarters building, Room L102, 401M Street SW, Washington, DC 20460,telephone number (202) 260–3027. TheDocket staff requests that interestedparties call for an appointment betweenthe hours of 9 am and 3:30 pm, beforevisiting the docket. The EPA regulationsat 40 CFR Part 2 provide that areasonable fee may be charged forcopying.

The workshop and public hearingcovering the rulemaking will be held inthe Lake Michigan Conference Room atthe U.S. EPA Region V Building, 77

West Jackson Boulevard, Chicago, IL.Persons wishing to present formalcomments at the public hearing shouldhave a written copy for submittal.FOR FURTHER INFORMATION CONTACT: Foradditional technical information contactMs. Debra DiCianna at (202) 260–7141.Additional economic information maybe obtained by contacting Ms. Susan M.Burris at (202) 260–5379. Backgrounddocuments supporting the proposedregulations are described in the‘‘Background Documents’’ sectionbelow. Many of the documents are alsoavailable from the Office of WaterResource Center, RC–4100, U.S. EPA,401 M Street SW., Washington, DC20460; telephone (202) 260–7786 for thevoice mail publication request line.


OverviewThe preamble describes the

definitions, acronyms, andabbreviations used in this notice; thebackground documents that supportthese proposed regulations; the legalauthority of these rules; a summary ofthe proposal; background information;and the technical and economicmethodologies used by the Agency todevelop these regulations. Thispreamble also solicits comment anddata on specific areas of interest.

Organization of This Document

Definitions, Acronyms, and Abbreviations

Background Documents

Legal AuthorityI. Summary and Scope of the Proposed

RegulationA. BackgroundB. The Centralized Waste Treatment

IndustryC. ScopeD. Proposed Limitations and Standards

II. BackgroundA. Clean Water ActB. Summary of Public ParticipationC. The Land Disposal Restrictions Program

III. Description of the IndustryA. Centralized Waste Treatment FacilitiesB. Waste Treatment Processes

IV. Summary of EPA Activities and DataGathering Efforts

A. EPA Initial Efforts to DevelopGuidelines for the Waste TreatmentIndustry

B. Wastewater Sampling ProgramC. 1991 Waste Treatment Industry

QuestionnaireD. Detailed Monitoring Questionnaire

V. Development of Effluent LimitationsGuidelines and Standards

A. Industry SubcategorizationB. Characterization of WastewaterC. Pollutants Not RegulatedD. Available TechnologiesE. Rationale for Selection of Proposed

Regulations

F. Monitoring to Demonstrate Compliancewith the Regulation

G. Determination of Long-Term Averages,Variability Factors, and Limitations forBPT

H. Regulatory ImplementationVI. Costs and Impacts of Regulatory

AlternativeA. CostsB. Pollutant ReductionsC. Economic Impact AssessmentD. Water Quality AnalysisE. Non-Water Quality Environmental

ImpactsVII. Administrative Requirements

A. Docket and Public RecordB. Clean Water Act Procedural

RequirementsC. Executive Order 12866D. Executive Order 12875E. Regulatory Flexibility ActF. Paperwork Reduction Act

VIII. Solicitation of Data and CommentsA. Introduction and General SolicitationB. Specific Data and Comment

Solicitations

Definitions, Acronyms, andAbbreviations

Administrator—The Administrator ofthe U.S. Environmental ProtectionAgency.

Agency—The U.S. EnvironmentalProtection Agency.

Average monthly dischargelimitation—The highest allowableaverage of ‘‘daily discharges’’ over acalendar month, calculated as the sumof all ‘‘daily discharges’’ measuredduring the calendar month divided bythe number of ‘‘daily discharges’’measured during the month.

BAT—The best available technologyeconomically achievable, as describedin Sec. 304(b)(2) of the CWA.

BCT—The best conventional pollutantcontrol technology, as described in Sec.304(b)(4) of the CWA.

BOD5—Biochemical oxygendemand—Five Day. A measure ofbiochemical decomposition of organicmatter in a water sample. It isdetermined by measuring the dissolvedoxygen consumed by microorganisms tooxidize the organic contaminants in awater sample under standard laboratoryconditions of five days and 70 °C. BOD5

is not related to the oxygenrequirements in chemical combustion.

BPT—The best practicable controltechnology currently available, asdescribed in Sec. 304(b)(1) of the CWA.

Centralized waste treatment facility—Any facility that treats any hazardous ornon-hazardous industrial wastesreceived from off-site by tanker truck,trailer/roll-off bins, drums, barge, orother forms of shipment. A ‘‘centralizedwaste treatment facility’’ includes (1) afacility that treats waste received fromoff-site exclusively and (2) a facility that

5465Federal Register / Vol. 60, No. 18 / January, 27, 1995 / Proposed Rules

treats wastes generated on-site as well aswaste received from off-site.

Centralized waste treatmentwastewater—Water that comes incontact with wastes received from off-site for treatment or recovery or thatcomes in contact with the area in whichthe off-site wastes are received, stored orcollected.

Clarifier—A treatment unit designedto remove suspended materials fromwastewater—typically bysedimentation.

COD—Chemical oxygen demand. Abulk parameter that measures theoxygen-consuming capacity of refractoryorganic and inorganic matter present inwater or wastewater. COD is expressedas the amount of oxygen consumed froma chemical oxidant in a specific test.

Commercial facility—Facilities thataccept waste from off-site for treatmentfrom facilities not under the sameownership as their facility.

Conventional pollutants—Thepollutants identified in Sec. 304(a)(4) ofthe CWA and the regulations thereunder(biochemical oxygen demand (BOD5),total suspended solids (TSS), oil andgrease, fecal coliform, and pH).

CWA—Clean Water Act. The FederalWater Pollution Control ActAmendments of 1972 (33 U.S.C. 1251 etseq.), as amended, inter alia, by theClean Water Act of 1977 (Public Law95–217) and the Water Quality Act of1987 (Public Law 100–4). CWT—Centralized Waste Treatment.

Daily discharge—The discharge of apollutant measured during any calendarday or any 24-hour period thatreasonably represents a calendar day.

Direct discharger—A facility thatdischarges or may discharge treated oruntreated pollutants into waters of theUnited States.

Effluent—Wastewater discharges.Effluent limitation—Any restriction,

including schedules of compliance,established by a State or theAdministrator on quantities, rates, andconcentrations of chemical, physical,biological, and other constituents whichare discharged from point sources intonavigable waters, the waters of thecontiguous zone, or the ocean. (CWASections 301(b) and 304(b).)

EIA—Economic Impact Analysis.EPA—The U.S. Environmental

Protection Agency.Facility—A facility is all contiguous

property owned, operated, leased orunder the control of the same person.The contiguous property may bedivided by public or private right-of-way.

Fuel Blending—The process of mixingorganic waste for the purpose ofgenerating a fuel for reuse.

Indirect discharger—A facility thatdischarges or may discharge pollutantsinto a publicly-owned treatment works.

LTA—Long-term average. Forpurposes of the effluent guidelines,average pollutant levels achieved over aperiod of time by a facility, subcategory,or technology option. LTAs were usedin developing the limitations andstandards in today’s proposedregulation.

Metal-bearing wastes—Wastes thatcontain metal pollutants frommanufacturing or processing facilities orother commercial operations. Thesewastes may include, but are not limitedto, the following: process wastewater,process residuals such as tank bottomsor stills and process wastewatertreatment residuals, such as treatmentsludges.

Minimum level—The level at whichan analytical system gives recognizablesignals and an acceptable calibrationpoint.

Mixed Commercial/Non-commercialfacility—Facilities that accept somewaste from off-site for treatment fromfacilities not under the same ownership,and some waste from off-site fortreatment from facilities under the sameownership as their facility.

New Source—‘‘New source’’ isdefined at 40 CFR 122.2 and 122.29.

Non-commercial facility—Facilitiesthat accept waste from off-site fortreatment only from facilities under thesame ownership as their facility.

Non-conventional pollutants—Pollutants that are neither conventionalpollutants nor priority pollutants listedat 40 CFR Section 401.

Non-detect value—A concentration-based measurement reported below thesample specific detection limit that canreliably be measured by the analyticalmethod for the pollutant.

Non-water quality environmentalimpact—An environmental impact of acontrol or treatment technology, otherthan to surface waters.

NPDES—The National PollutantDischarge Elimination Systemauthorized under Sec. 402 of the CWA.NPDES requires permits for discharge ofpollutants from any point source intowaters of the United States.

NSPS—New Source PerformanceStandards.

OCPSF—Organic Chemicals, Plastics,and Synthetic Fibers ManufacturingEffluent Guideline.

Off-Site—‘‘Off-site’’ means outside theboundaries of a facility.

Oily Wastes—Wastes that contain oiland grease from manufacturing orprocessing facilities or other commercialoperations. These wastes may include,but are not limited to, the following:

spent lubricants, cleaning fluids,process wastewater, process residualssuch as tank bottoms or stills andprocess wastewater treatment residuals,such as treatment sludges.

Oligopoly—A market structure withfew competitors, in which eachproducer is aware of his competitors’actions and has a significant influenceon market price and quantity.

On-site—‘‘On-site’’ means within theboundaries of a facility.

Organic-bearing Wastes—Wastes thatcontain organic pollutants frommanufacturing or processing facilities orother commercial operations. Thesewastes may include, but are not limitedto, process wastewater, processresiduals such as tank bottoms or stillsand process wastewater treatmentresiduals, such as treatment sludges.

Outfall—The mouth of conduit drainsand other conduits from which a facilityeffluent discharges into receivingwaters.

Pipeline—‘‘Pipeline’’ means an openor closed conduit used for theconveyance of material. A pipelineincludes a channel, pipe, tube, trench orditch.

Point source category—A category ofsources of water pollutants.

Pollutant (to water)—Dredged spoil,solid waste, incinerator residue, filterbackwash, sewage, garbage, sewagesludge, munitions, chemical wastes,biological materials, certain radioactivematerials, heat, wrecked or discardedequipment, rock, sand, cellar dirt, andindustrial, municipal, and agriculturalwaste discharged into water.

POTW or POTWs—Publicly-ownedtreatment works, as defined at 40 CFR403.3(0).

Pretreatment standard—A regulationthat establishes industrial wastewatereffluent quality required for discharge toa POTW. (CWA Section 307(b).)

Priority pollutants—The pollutantsdesignated by EPA as priority in 40 CFRpart 423, appendix A.

Process wastewater—‘‘Processwastewater’’ is defined at 40 CFR 122.2.

PSES—Pretreatment standards forexisting sources of indirect discharges,under Sec. 307(b) of the CWA.

PSNS—Pretreatment standards fornew sources of indirect discharges,under Sec. 307 (b) and (c) of the CWA.

RCRA—Resource Conservation andRecovery Act (PL 94–580) of 1976, asamended.

SIC—Standard IndustrialClassification (SIC). A numericalcategorization system used by the U.S.Department of Commerce to catalogueeconomic activity. SIC codes refer to theproducts, or group of products,produced or distributed, or to services


rendered by an operating establishment.SIC codes are used to groupestablishments by the economicactivities in which they are engaged. SICcodes often denote a facility’s primary,secondary, tertiary, etc. economicactivities.

Small business—Businesses withannual sales revenues less than $6million. This is the Small BusinessAdministration definition of smallbusiness for SIC code 4953, RefuseSystems (13 CFR Ch.1, § 121.601).

Solidification—The addition of agentsto convert liquid or semi-liquidhazardous waste to a solid before burialto reduce the leaching of the wastematerial and the possible migration ofthe waste or its constituent from thefacility. The process is usuallyaccompanied by stabilization.

Stabilization—A hazardous wasteprocess that decreases the mobility ofwaste constituents by means other thansolidification. Stabilization techniquesinclude mixing the waste with sorbentssuch as fly ash to remove free liquids.For the purpose of this rule, chemicalprecipitation is not a technique forstabilization.

TSS—Total Suspended Solids. Ameasure of the amount of particulatematter that is suspended in a watersample. The measure is obtained byfiltering a water sample of knownvolume. The particulate materialretained on the filter is then dried andweighed.

Variability factor—The dailyvariability factor is the ratio of theestimated 99th percentile of thedistribution of daily values divided bythe expected value, median or mean, ofthe distribution of the daily data. Themonthly variability factor is theestimated 95th percentile of thedistribution of the monthly averages ofthe data divided by the expected valueof the monthly averages.

Waste Receipt—Wastes received fortreatment or recovery. Waters of theUnited States—The same meaning setforth in 40 CFR 122.2.

Zero discharge—No discharge ofpollutants to waters of the United Statesor to a POTW. Also included in thisdefinition are discharge of pollutants byway of evaporation, deep-well injection,off-site transfer, and land application.

Background DocumentsThe regulations proposed today are

supported by several major documents.(1) EPA’s technical conclusionsconcerning the wastewater regulationsare detailed in the ‘‘DevelopmentDocument for Proposed EffluentLimitations Guidelines and Standardsfor the Centralized Waste Treatment

Industry,’’ hereafter referred to as theTechnical Development Document(EPA–821–R–95–006). (2) Detaileddocumentation of the procedure andequations used for costing thetechnology options is included in the‘‘Detailed Costing Document for theCentralized Waste Treatment Industry,’’hereafter referred to as the CostingDocument (EPA–821–R–95–002). (3)The Agency’s economic analysis isfound in the ‘‘Economic ImpactAnalysis of Proposed EffluentLimitations Guidelines and Standardsfor the Centralized Waste TreatmentIndustry,’’ hereafter called the EconomicImpact Analysis (EPA–821–R–95–001).(4) The Agency’s assessment ofenvironmental benefits is detailed in the‘‘Environmental Assessment ofProposed Effluent Guidelines for theCentralized Waste Treatment Industry,’’hereafter called the EnvironmentalAssessment (EPA–821–R–95–003). (5)An analysis of the incremental costs andpollutant removals for the effluentregulations is presented in ‘‘Cost-Effectiveness Analysis of ProposedEffluent Limitations Guidelines andStandards for the Centralized WasteTreatment Industry,’’ hereafter calledthe Cost-Effectiveness Analysis (EPA–821–R–95–004). (6) The methodologyused for calculating limitations isdiscussed in the ‘‘Statistical SupportDocument for Proposed EffluentLimitations Guidelines and Standardsfor the Centralized Waste TreatmentIndustry’’ hereafter referred to as theStatistical Support Document (EPA–821–R–95–005).

Legal AuthorityThese regulations are being proposed

under the authority of Sections 301,304, 306, 307, 308, and 501 of the CleanWater Act, 33 U.S.C. Sections 1311,1314, 1316, 1317, 1318, and 1361.

I. Summary and Scope of the ProposedRegulation

A. Background

Congress adopted the Clean Water Act(CWA) to ‘‘restore and maintain thechemical, physical, and biologicalintegrity of the Nation’s waters.’’Section 101(a), 33 U.S.C. § 1251(a). Toachieve this goal, the CWA prohibits thedischarge of pollutants into navigablewaters except in compliance with thestatute. The Clean Water Act attacks theproblem of water pollution on a numberof different fronts. Its primary reliance,however, is on establishing restrictionson the types and amounts of pollutantsdischarged from various industrial,commercial, and public sources ofwastewater.

Congress recognized that regulatingonly those sources that dischargeeffluent directly into the nation’s waterswould not be sufficient to achieve theCWA’s goals. Consequently, the CWArequires EPA to promulgate nationallyapplicable pretreatment standardswhich restrict pollutant discharges forthose who discharge wastewaterindirectly through sewers flowing topublicly-owned treatment works(POTWs) (Section 307 (b) and (c), 33U.S.C. § 1317 (b) & (c)). Nationalpretreatment standards are establishedfor those pollutants in wastewater fromindirect dischargers which may passthrough or interfere with POTWoperations. Generally, pretreatmentstandards are designed to ensure thatwastewater from direct and indirectindustrial dischargers are subject tosimilar levels of treatment. In addition,POTWs are required to implement localtreatment limits applicable to theirindustrial indirect dischargers to satisfyany local requirements (40 CFR 403.5).

Direct dischargers must comply witheffluent limitations in NationalPollutant Discharge Elimination System(‘‘NPDES’’) permits; indirect dischargersmust comply with pretreatmentstandards. These limitations andstandards are established by regulationfor categories of industrial dischargersand are based on the degree of controlthat can be achieved using variouslevels of pollution control technology.In addition, pretreatment standardsmust be established for those pollutantswhich are not susceptible to treatmentby POTWs or which would interferewith POTW operations (CWA Sections301(b), 304(b), 306, 307 (b)–(d), 33U.S.C. §§ 1311(b), 1314(b), 1316, and1317 (b)–(d)).

Today’s proposal represents theAgency’s first attempt to developnational guidelines that establisheffluent limitations and pretreatmentstandards for new and existingdischargers from the Centralized WasteTreatment Industry. EPA estimates thatthe regulation being proposed todaywould reduce the discharge ofconventional, priority, and non-conventional pollutants by at least 123million pounds per year. EPAperformed an analysis of the waterquality benefits that would be derivedfrom this proposal and predicts thatcontributions by centralized wastetreatment facilities to current excursionsof aquatic life and/or human healthtoxic effect levels would be eliminatedfor twenty streams and reduced for tenothers. EPA also projects throughmodeling that eleven of the seventeenPOTWs expected to experienceinhibition of treatment due to


centralized treatment facilities would nolonger experience inhibition from thesesources.

B. The Centralized Waste TreatmentIndustry

The adoption of the increasedpollution control measures required byCWA and RCRA requirements had anumber of ancillary effects, one ofwhich has been the formation anddevelopment of a waste treatmentindustry. Several factors havecontributed to the growth of thisindustry. Thus, for example, in order tocomply with CWA discharge limits,categorical industries have installednew (or upgraded existing) wastewatertreatment facilities in order to treat theirprocess wastewater. But the wastewatertreatment may produce a residualsludge which itself may require furthertreatment before disposal under EPARCRA requirements. Furthermore, manyindustrial process by-products now areeither RCRA listed or characteristichazardous wastes which require specialhandling or treatment before disposal.

A manufacturing facility’s options formanaging these wastes include on-sitetreatment with its other wastes orsending them off-site. Because a largenumber of operations have chosen tosend their wastes off-site, specializedfacilities have developed whose solecommercial operations are the handlingof wastewater treatment residuals andindustrial process by-products.Moreover, some industrial operationsalso have chosen to accept wastes fromoff-site for treatment in their on-sitefacilities. Further, there are somecommercial facilities to which wastesare piped for treatment. Other wastes goto landfills or incinerators for disposal.

The waste treatment industryincludes facilities which receive bothhazardous and non-hazardous industrialwaste. These facilities receive a varietyof wastes for treatment and recovery ofwaste components. Among these wastesare wastewater treatment sludges,process residuals, tank bottoms, off-specproducts, and wastes generated fromclean-up activities. Some facilities mayalso treat industrial process wastewaterwith these wastes.

In the early 1990’s, this industryexperienced a slow down because manyexisting facilities were designed tohandle larger quantities than the marketproduced. Reduced economic activitygenerally in combination with pollutionprevention measures resulted in adecrease in the amount of waste sentoff-site for treatment. As a result,competition among facilities increasedresulting in facilities operating belowcapacity and experiencing economic

and financial difficulties. This may bechanging at the present. Recently,participants in the March 1994 publicmeeting for this proposal stated that theindustry is experiencing new growthdue to increasing environmentalregulations. The Agency solicitsinformation and data on the current sizeof the industry and trends related to thegrowth or decline in need for theservices provided by these facilities.

C. ScopeToday’s proposal would establish

discharge limitations and standards fordischarges from those facilities whichthe rule defines as ‘‘centralized wastetreatment facilities.’’ The facilitieswhich are covered by this guidelineinclude stand-alone waste treatment andrecovery facilities which treat wastereceived from off-site. ‘‘Centralizedwaste treatment facilities’’ also includetreatment systems which treat on-sitegenerated process wastewater withwastes received from off-site. However,the rule does not apply to facilitieswhich receive wastes from off-site bypipeline from the original source ofwaste generation.

Centralized waste treatment facilitiesinclude the following: (1) Commercialfacilities that accept waste from off-sitefor treatment from facilities not underthe same ownership as the treatingfacility; (2) non-commercial facilitiesthat accept waste from off-site fortreatment only from facilities under thesame ownership (intra-companytransfer); or (3) mixed commercial/non-commercial facilities that accept somewaste from off-site for treatment fromfacilities not under the same ownershipand some waste from facilities under thesame ownership.

This summary section highlights thetechnology bases and other key aspectsof the proposed rule. The technologydescriptions in this section arepresented in abbreviated form; moredetailed descriptions are included in theTechnical Development Document andSection V.E. Today’s proposal presentsthe Agency’s recommended regulatoryapproach as well as other optionsconsidered by EPA. The Agency’srecommended approach for establishingdischarge limitations is based on adetailed evaluation of the available data.As indicated below in the discussion ofthe specifics of the proposal, the Agencywelcomes comment on all options andissues and encourages commenters tosubmit additional data during thecomment period. Also, the Agencyplans additional discussions withinterested parties during the commentperiod to ensure that the Agency has theviews of all parties and the best possible

data upon which to base a decision forthe final regulation. EPA’s finalregulation may be based upon anytechnologies, rationale or approachesthat are a logical outgrowth of thisproposal and public comments,including any options considered butnot selected for today’s proposedregulation.

In today’s notice, EPA is proposing forthe Centralized Waste Treatment PointSource Category effluent limitationsguidelines and standards based on BPT,BCT, BAT, NSPS, PSES, and PSNS fornew and existing facilities that areengaged in the treatment of industrialwaste from off-site facilities.

The proposed regulation todayapplies to the following activities:

• Subcategory A: Discharges fromoperations which treat, or treat andrecover metals from, metal-bearingwaste received from off-site,

• Subcategory B: Discharges fromoperations which treat, or treat andrecover oil from, oily waste receivedfrom off-site, and

• Subcategory C: Discharges fromoperations which treat, or treat andrecover organics from, other organic-bearing waste received from off-site.

Facilities subject to the guidelines andstandards would include facilitieswhose exclusive operation is thetreatment of off-site generated industrialwaste as well as industrial ormanufacturing facilities that also acceptwaste from off-site for centralizedtreatment. A further discussion of thetypes of waste included in eachsubcategory is included in the TechnicalDevelopment Document and SectionIII.B. of this notice.

The proposed effluent limitationsguidelines and standards are intendedto cover wastewater discharges resultingfrom treatment of, or recovery ofcomponents from, hazardous and non-hazardous industrial waste receivedfrom off-site facilities by tanker truck,trailer/roll-off bins, drums, barges, orother forms of shipment. Any dischargesgenerated from the treatment of wastesreceived through an open or enclosedconduit (e.g., pipeline, channels,ditches, and trenches, etc.) from theoriginal source of waste generation arenot included in the regulation.However, discharges generated from thetreatment of CWT wastes received bypipeline from a facility acting as anintermediate collection point for CWTwastes received from off-site would besubject to the proposed requirements.Based on information collected in the1991 Waste Treatment IndustryQuestionnaire and discussions withoperators of waste treatment facilities,EPA has concluded that facilities which


receive all their wastes through apipeline or trench from the originalsource of waste generation are receivingcontinuous flows of process wastewaterwith relatively consistent pollutantprofiles. In the case of these treatmentfacilities, the process wastewater flowsin virtually all cases would be subject tocategorical regulations if dischargedfrom the original point of wastegeneration. However, these companies,instead of discharging to a surface wateror POTW, discharge process wastewaterto a ‘‘centralized pipeline’’ facility. EPAhas concluded that the effluentlimitations and pretreatment standardsfor centralized waste treatment facilitiesshould not apply to such pipelinetreatment facilities because their wastesdiffer fundamentally from thosereceived at centralized waste treatmentfacilities. In large part, the wastestreams received at centralized wastetreatment facilities are moreconcentrated and variable, includingsludges, tank bottoms, off-specproducts, and process residuals. Thelimitations and standards developed forcentralized waste treatment facilities, inturn, reflect the types of waste streamsbeing treated and are necessarilydifferent from those promulgated fordischarges resulting from the treatmentof process wastewater for categoricalindustries. However, this proposedpipeline exclusion would not apply tofacilities which receive waste viaconduit (i.e., pipeline, trenches, ditches,etc.) from facilities that are actingmerely as waste collection centers thatare not the original source of the wastegeneration.

In evaluating the current operationand performance of centralized wastetreatment facilities, the Agency isconcerned about the effectivemanagement of such highly-concentrated waste streams. Due to thevariability of waste streams, thepossibility exists for dilution to occurrather than effective treatment.Therefore, the Agency is proposing torequire monitoring to demonstratecompliance with the limitations andstandards for the regulated treatmentsubcategories The limitations andstandards proposed today are based ontreatment systems that optimizeremovals for homogeneous wastes. If afacility commingles differentsubcategories of CWT wastes beforetreatment or mixes CWT wastes withnon-CWT waste streams beforetreatment, the facility must demonstratethat its treatment system achievespollutant limits equivalent to theeffluent limitations and standards thatwould be achieved if the CWT wastes

were treated separately. (In addition,there may be circumstances where themixing of off-site and on-site wastestreams is necessary to prevent upset oftreatment systems, such as withbiological treatment for organic wastestreams.) Equivalent treatment isdemonstrated when Centralized WasteTreatment Industry pollutants ofconcern are (1) detectable at quantifiablelevels prior to mixing, (2) are detectedat quantifiable levels following mixing,and (3) the on-site treatment system isdesigned to treat the pollutants ofconcern in some manner other thanincidental removals by partitioning tosludge or air. The Agency believes suchan approach is necessary to ensureachievement of the pollutant dischargelevels which the Agency haspreliminarily determined may beobtained through proper treatment ofthe CWT wastes. In the absence of sucha requirement to demonstrate achievableremovals, facilities may merely dilutewastes with other waste streams to meetthe required discharge levels.

The Agency also solicits comment onincluding a de minimis quantity orpercentage of off-site receipts incomparison to the total facility flow forwhich facilities would not beconsidered in the scope of thisregulation. According to commentsreceived on the May 1994 proposedEffluent Guideline Plan (59 FR 25859),some manufacturing facilities mayreceive a few shipments of waste or off-spec products to be treated on-site withwastewater from on-site manufacturingprocesses, but these facilities do notactively accept large quantities of wastefrom off-site for the purpose oftreatment and disposal. In the 1991Waste Treatment IndustryQuestionnaire, no facilities wereidentified with intermittent shipmentsof waste, but the questionnaire mailinglist was developed on the basis of afacility’s regular business. Therefore,manufacturing facilities which do notaccept off-site waste on a normal basiswere not included in the mailing list.The EPA is requesting information onthe amounts of waste received and thereasons the waste were accepted todetermine if a de minimis quantityshould be established to limit theapplicability of this rulemaking. Atpresent, no de minimis quantity hasbeen established for this rulemaking.Facilities are included in the scope ofthis regulation regardless of the quantityreceived for treatment.

D. Proposed Limitations and Standards

1. Best Practicable Control TechnologyCurrently Available (BPT)

The Agency is proposing to set BPTeffluent limitations guidelines for allsubcategories of the Centralized WasteTreatment Industry to controlconventional, priority, and non-conventional pollutants in the wastetreatment effluent. In the case of metal-bearing wastes that include cyanidestreams, achievement of BPT limitationsrequires pretreatment for cyanide. TableI.D–1 is a summary of the technologybasis for the proposed effluentlimitations for each subcategory.L2,i1,xs36,r50,r150

Table I.D–1.—Technology Basis for BPTEffluent Limitationssubpartbasis

The pollutants controlled and thepoints of application vary for eachsubcategory and are described inSections V.

2. Best Conventional Pollutant ControlTechnology (BCT)

The EPA is proposing BCT effluentlimitations guidelines for TotalSuspended Solids (TSS) and Oil andGrease for the Metals and OilsSubcategories of the Centralized WasteTreatment Industry. The EPA is alsoproposing to set BCT effluentlimitations guidelines for biochemicaloxygen demand (BOD5) and totalsuspended solids (TSS) for the OrganicsSubcategory. The proposed BCT effluentlimitations guidelines are equal to theproposed BPT limitations forconventional pollutants. Thedevelopment of proposed BCT effluentlimitations is further explained inSection V.

3. Best Available TechnologyEconomically Achievable (BAT)

The Agency is proposing to set BATeffluent limitations guidelines for allsubcategories of the Centralized WasteTreatment Industry. These proposedlimitations are based on thetechnologies proposed for BPT. Thepollutants controlled and the points ofapplication vary for each subcategoryand are described in Section V.

4. New Source Performance Standards(NSPS)

EPA is proposing to set NSPSequivalent to the proposed BPT/BCT/BAT effluent limitations for allsubcategories of the Centralized WasteTreatment Industry. NSPS are discussedin more detail in Section V.


1 In the initial stages of EPA CWA regulation, EPAefforts emphasized the achievement of BPTlimitations for control of the ‘‘classical’’ pollutants(e.g., TSS, pH, BOB5). However, nothing on the faceof the statute explicitly restricted BPT limitation tosuch pollutants. Following passage of the CleanWater Act of 1977 with its requirement for pointssources to achieve best available technologylimitations to control discharges of toxic pollutants,EPA shifted its focus to address the listed prioritypollutants under the guidelines program. BPTguidelines continue to include limitations toaddress all pollutants.

5. Pretreatment Standards for ExistingSources (PSES)

For pollutants that pass-through orotherwise interfere with POTWs, EPA isproposing to set PSES equivalent to theproposed BAT effluent limitations forall subcategories of the CentralizedWaste Treatment Industry. PSES arefurther discussed in Section V.

6. Pretreatment Standards for NewSources (PSNS)

For pollutants that pass-through orotherwise interfere with POTWs, EPA isproposing to set PSNS equivalent to theproposed NSPS effluent limitations forall subcategories of the CentralizedWaste Treatment Industry. PSNS arefurther discussed in Section V.

II. Background

A. Clean Water Act

1. Statutory Requirements of RegulationAs previously discussed, Section

301(a) of the CWA prohibits dischargesof pollutants to navigable waters exceptin compliance with the statute. 33U.S.C. 1311(a). Section 301(b) requiresthat direct dischargers comply witheffluent limitations established by EPAfor categories of industrial dischargersor in the case of certain categories ofnew dischargers, new sourceperformance standards.

Section 307 requires indirectdischargers to comply with pretreatmentstandards and Section 306 requirescompliance with new sourceperformance standards.

These guidelines and standards aresummarized below:

a. Best practicable control technologycurrently available (BPT)—Sec.304(b)(1) of the CWA. In the guidelines,EPA defines BPT effluent limits forconventional, priority,1 and non-conventional pollutants. In specifyingBPT, EPA looks at a number of factors.EPA first considers the cost of achievingeffluent reductions in relation to theeffluent reduction benefits. The Agencynext considers: the age of the equipmentand facilities, the processes employedand any required process changes,engineering aspects of the controltechnologies, non-water quality

environmental impacts (includingenergy requirements), and such otherfactors as the Agency deemsappropriate. CWA § 304(b)(1)(B).Traditionally, EPA establishes BPTeffluent limitations based on the averageof the best performances of facilitieswithin the industry of various ages,sizes, processes or other commoncharacteristic. Where, however, existingperformance is uniformly inadequate,EPA may require higher levels of controlthan currently in place in an industrialcategory if the Agency determines thatthe technology can be practicallyapplied.

b. Best conventional pollutant controltechnology (BCT)—Sec. 304(b)(4) of theCWA. The 1977 amendments to theCWA required EPA to identify effluentreduction levels for conventionalpollutants associated with BCTtechnology for discharges from existingindustrial point sources. In addition toother factors specified in Section304(b)(4)(B), the CWA requires that EPAestablish BCT limitations afterconsideration of a two part ‘‘cost-reasonableness’’ test. EPA explained itsmethodology for the development ofBCT limitations in July 1986 (51 FR24974).

Section 304(a)(4) designates thefollowing as conventional pollutants:biochemical oxygen demand (BOD5),total suspended solids (TSS), fecalcoliform, pH, and any additionalpollutants defined by the Administratoras conventional. The Administratordesignated oil and grease as anadditional conventional pollutant onJuly 30, 1979 (44 FR 44501).

c. Best available technologyeconomically achievable (BAT)—Sec.304(b)(2) of the CWA. In general, BATeffluent limitations guidelines representthe best economically achievableperformance of plants in the industrialsubcategory or category. The factorsconsidered in assessing BAT include thecost of achieving BAT effluentreductions, the age of equipment andfacilities involved, the processemployed, potential process changes,and non-water quality environmentalimpacts, including energy requirements.The Agency retains considerablediscretion in assigning the weight to beaccorded these factors. Unlike BPTlimitations, BAT limitations may bebased on effluent reductions attainablethrough changes in a facility’s processesand operations. As with BPT, whereexisting performance is uniformlyinadequate, BAT may require a higherlevel of performance than is currentlybeing achieved based on technologytransferred from a different subcategoryor category. BAT may be based upon

process changes or internal controls,even when these technologies are notcommon industry practice.

d. New source performance standards(NSPS)—Sec. 306 of the CWA. NSPSreflect effluent reductions that areachievable based on the best availabledemonstrated treatment technology.New facilities have the opportunity toinstall the best and most efficientproduction processes and wastewatertreatment technologies. As a result,NSPS should represent the moststringent controls attainable through theapplication of the best available controltechnology for all pollutants (i.e.,conventional, nonconventional, andpriority pollutants). In establishingNSPS, EPA is directed to take intoconsideration the cost of achieving theeffluent reduction and any non-waterquality environmental impacts andenergy requirements.

e. Pretreatment standards for existingsources (PSES)—Sec. 307(b) of theCWA. PSES are designed to prevent thedischarge of pollutants that pass-through, interfere-with, or are otherwiseincompatible with the operation ofpublicly-owned treatment works(POTW). The CWA authorizes EPA toestablish pretreatment standards forpollutants that pass-through POTWs orinterfere with treatment processes orsludge disposal methods at POTWs.Pretreatment standards are technology-based and analogous to BAT effluentlimitations guidelines.

The General PretreatmentRegulations, which set forth theframework for the implementation ofcategorical pretreatment standards, arefound at 40 CFR Part 403. Thoseregulations contain a definition of pass-through that addresses localized ratherthan national instances of pass-throughand establish pretreatment standardsthat apply to all non-domesticdischargers. See 52 FR 1586, January 14,1987.

f. Pretreatment standards for newsources (PSNS)—Sec. 307(b) of theCWA. Like PSES, PSNS are designed toprevent the discharges of pollutants thatpass-through, interfere-with, or areotherwise incompatible with theoperation of POTWs. PSNS are to beissued at the same time as NSPS. Newindirect dischargers have theopportunity to incorporate into theirplants the best available demonstratedtechnologies. The Agency considers thesame factors in promulgating PSNS as itconsiders in promulgating NSPS.

2. Section 304(m) Consent DecreeSection 304(m) of the Act, added by

the Water Quality Act of 1987, requiresEPA, before February 4, 1988, to


establish a schedule (1) for reviewingand revising existing guidelines andstandards and (2) for promulgatingeffluent guidelines for categories ofsources of priority or nonconventionalpollutants for which effluent limitationsand pretreatment standards had notpreviously been published. Thestatutory deadline for such guidelines isno later four years after February 4,1987, for categories identified in thefirst published plan.

The Natural Resource DefenseCouncil (NRDC) and Public Citizen, Inc.filed suit against the Agency, allegingviolation of Section 304(m) and otherstatutory authorities requiringpromulgation of effluent limitationsguidelines, new source performancestandards, new source performancestandards and pretreatment standards.(NRDC, et al. v. Reilly, Civ. No. 89–2980(D.D.C.). Under the terms of a consentdecree dated January 31, 1992, whichsettled the litigation, EPA agreed, amongother things, to propose and promulgate20 new guidelines establishing BPT,BCT and BAT limitations andpretreatment standards, includingguidelines and standards for CWTfacilities.

B. Summary of Public ParticipationDuring the data gathering activities

that preceded development of theproposed rules, EPA met withrepresentatives from the industry, theHazardous Waste Treatment Council,the National Solid Waste ManagementAssociation, and the Natural ResourcesDefense Council. Because most of thefacilities affected by this proposal areindirect dischargers, the Agency hasmade a concerted effort to consult withState and local entities that will beresponsible for implementing thisregulation. EPA has met withpretreatment coordinators from aroundthe nation and presented our regulatoryapproach before the Association ofMetropolitan Sewerage Authorities tosolicit feedback on implementationissues. Today’s proposal solicitscomment on many of the issues raisedby EPA’s co-regulators.

On March 8, 1994, EPA sponsored apublic meeting, where the Agencyshared information about the contentand the status of the proposedregulation. The meeting was announcedin the Federal Register, agendas andmeeting materials were distributed atthe meeting. The public meeting alsogave interested parties an opportunity toprovide information, data, and ideas onkey issues. EPA’s intent in conductingthe public meeting was to elicit inputthat would improve the quality of theproposed regulations.

At the public meeting, the Agencyclarified that the public meeting wouldnot replace the notice-and-commentprocess, nor would the meeting becomea mechanism for a negotiatedrulemaking. While EPA promised toaccept information and data at themeeting and make good faith efforts toreview all information and address allissues discussed at the meeting, EPAcould not commit to fully assessing andincorporating all comments into theproposal. EPA will assess all commentsand data received at the public meetingprior to promulgation.

C. The Land Disposal RestrictionsProgram

1. Introduction to RCRA Land DisposalRestrictions

The Hazardous and Solid WasteAmendments (HSWA) to the ResourceConservation and Recovery Act (RCRA),enacted on November 8, 1984, largelyprohibit the land disposal of untreatedhazardous wastes. Once a hazardouswaste is prohibited from land disposal,the statute provides only two options forlegal land disposal: meet the treatmentstandard for the waste prior to landdisposal, or dispose of the waste in aland disposal unit that has been foundto satisfy the statutory no migration test.A no migration unit is one from whichthere will be no migration of hazardousconstituents for as long as the wasteremains hazardous. RCRA Sections 3004(d), (e), (g)(5). The treatment standardsmay be expressed as either constituentconcentration levels or as specificmethods of treatment. These standardsmust substantially diminish the toxicityof the waste or substantially reduce thelikelihood of migration of hazardousconstituents from the waste so thatshort-term and long-term threats tohuman health and the environment areminimized. RCRA Section 3004(m)(1).For purposes of the restrictions, theRCRA program defines land disposal toinclude any placement of hazardouswaste in a landfill, surfaceimpoundment, waste pile, injectionwell, land treatment facility, salt domeformation, salt bed formation, orunderground mine or cave.

2. BDAT and Land Disposal RestrictionsStandards

EPA generated a set of hazardouswaste treatability data to serve as thebasis for land disposal restrictionsstandards. First, EPA identified BestDemonstrated Available TreatmentTechnology (BDAT) for each listedhazardous waste. BDAT was thattreatment technology which EPA foundto be the most effective for that waste

and which was also readily available togenerators and treaters. In some casesEPA designated as BDAT for a particularwaste stream a treatment technologyshown to have successfully treated asimilar but more difficult to treat wastestream. This ensured that the landdisposal restrictions standards for alisted waste stream were achievablesince they always reflected the actualtreatability of the waste itself or of amore refractory waste.

3. RCRA Phase 2 and the CentralizedWaste Treatment Industry EffluentGuidelines

The RCRA Phase 2 final rule July 27,1994, promulgated Universal TreatmentStandards (UTS) for all constituentsregulated by the RCRA Land DisposalRestrictions program. The UTS are aseries of concentration levels forwastewater and nonwastewaters thatprovide a single treatment standard foreach constituent regardless of theprocess generating it. Previously, manyconstituents were regulated with severalnumerical treatment standardsdepending on the identity of the originalwaste. Comments from generators andtreaters supported the UTS as a meansof simplifying compliance with LDRrequirements by ensuring that only onetreatment standard applies to anyconstituent in any waste residue.

While the UTS may not apply to thosefacilities addressed by the CWT effluentguidelines (due to the lack of landdisposal), both involve many of thesame wastewater and both aretechnology-based. Consequently, EPA isidentifying the major differencesbetween the development of the tworules.

4. General Differences in ApproachesBetween LDR UTS and CentralizedWaste Treatment Industry EffluentGuidelines

Comparing the effluent guidelinesproposed by today’s rule for theCentralized Waste Treatment Industrywith the UTS finalized in July 1994shows that the RCRA and CWAapproaches are similar in that both rulesaddress many of the same waste streamsand base treatment standards on manyof the same wastewater treatmenttechnologies. However, the two sets oftreatment standards differ both in theirformat and in the numerical values setfor each constituent.

The differences in format betweeneffluent guidelines and LDR’s arerelatively straightforward. The effluentguidelines provide for several types ofdischarge (new vs. existing sources,pretreatment vs. direct discharge) whilethe LDR program makes no distinctions


among different types of land disposal.While the effluent guidelines addressboth monthly and daily limits, UTSonly sets daily limits.

For many pollutants, there aredifferences in the numerical values ofthe limits. The differences result fromthe use of different legal criteria fordeveloping the limits and resultingdifferences in the technical andeconomic criteria and data sets forestablishing the respective limits. Asdescribed above, the LDR UTS establisha single numerical standard for eachregulated pollutant parameter thatapplies to all waste streams.

The Clean Water Act pollutantspecific numerical effluent limitationsguidelines and standards (40 CFRSubchapter N) often differ not only fromthe LDR UTS but also from point-sourcecategory to point-source category (e.g.,Electroplating, 40 CFR part 413; andMetal Finishing, 40 CFR part 433). Theeffluent guidelines limitations andstandards are industry-specific,subcategory-specific, and technology-based. The numerical limits aretypically based on different data setsthat reflect the performance of specificwaste water management and treatmentpractices. Differences in the limitsreflect differences in the statutoryfactors that the Administrator isrequired to consider in developingtechnically and economicallyachievable limitations and standards—manufacturing products and processes(which for CWT facilities includes typesof treatment or waste managementservices performed), raw materials,wastewater characteristics, treatability,facility size, geographic location, age offacility and equipment, non-waterquality environmental impacts, andenergy requirements.

Limits for CWT’s are developed forindividual industrial subcategoriesleaving the permit writer with theresponsibility of assembling the‘‘building blocks’’ into a discharge limit.There is, however, only one set of LDRstandards, the Universal TreatmentStandards (UTS) applying to allconstituents regardless of the wastestream. While there is one set ofstandards for LDR rules, the limits aregenerally based on BDAT applied to thewaste that is most difficult to treat.

A consequence of these differingapproaches is that similar or identicalwaste streams are regulated at differentlevels. Several of the effluent guidelinesdischarge categories reflect pretreatmentprior to discharge to POTW’s wherethere is further treatment and aretherefore not directly comparable toLDR wastewater standards. However,those categories that represent daily

maximum standards for discharge oftreated wastes are analogous to the LDRwastewater standards, and thenumerical differences in these standardsreflect differences in methodology asdescribed above.

EPA’s survey of CWT facilitiesidentified no wastewater dischargeswhich would be regulated under theCWT effluent limitations guidelines andstandards and the Universal TreatmentStandards. Because none of the 72 CWTdischarging CWT facilities dischargewastewater effluent to land disposalunits, the proposed regulations for theCWT Industry are not redundantrequirements.

III. Description of the Industry

A. Centralized Waste TreatmentFacilities

Presented below is a brief summarydescription of the Centralized WasteTreatment Industry for which EPA istoday proposing guidelines.

Based upon responses to EPA’s 1991Waste Treatment IndustryQuestionnaire (see discussion below),the Agency estimates that there areapproximately 85 centralized wastetreatment facilities in 31 States of thetype for which EPA is proposinglimitations and standards. Theseinclude both stand-alone treatmentfacilities as well as facilities which treattheir own process wastewater andtreatment or process residuals as well aswastes received from off-site. The majorconcentration of centralized wastetreatment facilities in the U.S. are foundin the Midwest, Northeast, andNorthwest regions, due to the proximityof the industries generating the wastesundergoing treatment.

As previously noted, centralizedwaste treatment facilities accept avariety of different wastes for treatment.Before these facilities accept a waste fortreatment, the waste generallyundergoes a rigorous screening forcompatibility with other wastes beingtreated at the facility. Waste generatorsinitially furnish the treatment facilitywith a sample of the waste stream to betreated. The sample is analyzed tocharacterize the level of pollutants inthe sample and bench-scale treatabilitytests are performed to determine whattreatment is necessary to treat the wastestream effectively. After all analysis andtests are performed, the treatmentfacility determines the cost for treatingthe waste stream. If the waste generatoraccepts the cost of treatment, shipmentsof the waste stream to the treatmentfacility will begin. For each truck loadof waste received for treatment, thetreatment facility collects a sample from

the shipment and analyzes the sampleto determine if it is similar to the initialsample tested. If the sample is similar,the shipment of waste will be treated. Ifthe sample is not similar but falls withinan allowable range as determined by thetreatment facility, the treatment facilitywill reevaluate the estimated cost oftreatment for the shipment. Then, thewaste generator decides if the waste willremain at the treatment facility fortreatment. If the sample is not similarand does not fall within an allowablerange, the treatment facility will declinethe shipment for treatment.

Treatment facilities and wastegenerators complete extensive amountsof paperwork during the wasteacceptance process. Most of thepaperwork is required by Federal, State,and local regulations. The amount ofpaperwork necessary for accepting awaste stream emphasizes the difficultyof operating Centralized WasteTreatment facilities.

In its information and data-gatheringeffort, EPA also looked at how thesefacilities handle wastes after they areaccepted for treatment. Even though awaste must surmount a number ofhurdles before being accepted fortreatment at a facility, many facilities donot devote the same level of attention tothe process of managing and treatingwastes for optimal removals. Thus,EPA’s data show that approximatelyhalf of the facilities in the industry 1)accept wastes for treatment in more thanone of the waste categories (metal-bearing, oily or organic-bearing) beingconsidered here or 2) operate otherindustrial processes that generate wastesat the same site. In most cases, the wastestreams from these various sources aremixed prior to treatment or afterminimal pretreatment.

The problems associated with themixing of the different types of wastesand wastewater treated at centralizedwaste treatment facilities or mixing withother industrial wastewater and non-contaminated stormwater exacerbatedthe difficulty of evaluating adequatetreatment performance. EPA concludedthat mixing waste streams adverselyaffects pollutant removal in thedischarge water. Rather than treating toremove pollutants, the facilities werediluting their streams to achieverequired effluent levels. Therefore, EPAhas concluded reasonable furtherprogress to the goal of reducingdischarges requires achievement ofdischarge levels associated withtreatment of segregated wastestreams.Consequently, as explained above, theAgency is proposing to establisheffluent limitations which reflect


achievable effluent reductions forunmixed wastes.

B. Waste Treatment ProcessesAs the Agency learned from data and

information collected as a result of the1991 Waste Treatment IndustryQuestionnaire, CWTs accept many typesof hazardous and non-hazardousindustrial waste for treatment in liquidor solid form. In 1989, approximately1.1 billion gallons of industrial wastewere accepted for treatment of which 53percent were hazardous and 47 percentwere non-hazardous.

1. Metal-Bearing Waste Treatment orRecovery

In 1989, 709 million gallons of metal-bearing wastes were accepted fortreatment by 56 facilities. This metal-bearing waste comprised the largestportion of the waste treated by theCentralized Waste Treatment Industry.The typical treatment process used formetal-bearing wastes was precipitationwith lime or caustic followed byfiltration. The sludge generated wasthen landfilled in a RCRA Subtitle C orD landfill depending upon its content.A small fraction of facilities recoveredmetals from the waste using selectivemetals precipitation or electrolyticmetals recovery processes. Mostfacilities that recovered metals did notgenerate a sludge that required disposal,instead, the sludges were sold for themetal content.

2. Oily Waste Treatment or RecoveryApproximately 223 million gallons of

oily waste were accepted for treatmentby 35 facilities in 1989. A wide range ofoily wastes were accepted for treatmentand the on-site treatment scheme wasdetermined by the type of oily wasteaccepted. The oily waste accepted fortreatment could typically be classifiedas either: (1) stable oil-water emulsions,such as coolants and lubricants; or (2)unstable oil-water emulsions, such asbilge water. Stable oil-water emulsionsare more difficult to treat because thedroplets of the dispersed phase are sosmall that separation of the oil andwater phases by settling would occurvery slowly or not at all and required achemical process to break the emulsionto adequately treat the waste. From thedata collected in the 1991 WasteTreatment Industry Questionnaire,chemical emulsion breaking processeswere the most widely-used treatmenttechnology at the 29 oil recoveryfacilities, and, therefore, EPA believesthat these facilities primarily accept fortreatment stable oil-water emulsions.The wastewater effluent resulting fromthe emulsion-breaking process was

typically mixed with wastewater fromother CWT subcategories or stormwaterfor further treatment prior to discharge.Six facilities did not operate oilrecovery processes and used onlydissolved air flotation (DAF), atechnique used to separate oil andsuspended solids from water byskimming, to treat the oily wastereceipts. Consequently, EPA concludedthat these facilities were receiving fortreatment less stable oil-wateremulsions that were amenable to gravityseparation or dissolved air flotation, anddid not require chemical emulsionbreaking treatment processes. EPA’ssampling program focused on facilitiesthat treated the more concentrated andmore difficult to treat stable oil-wateremulsions as reported by waste manifestforms and facility records. In August1994, EPA conducted additionalsampling at an oily waste treatmentfacility to further characterize the typesof oils accepted for treatment and thetechnologies used. The data has notbeen reviewed at the time of thisproposal, but the data is included in therulemaking record and will be evaluatedprior to promulgation. EPA solicitscomments with detailed informationand data on the concentrations ofpollutants and type of oily wastesaccepted for treatment by these facilitiesso that EPA can develop a morethorough understanding of the facilityoperations. Any new information usedto establish the basis for the finalregulation will be made available forpublic comment.

3. Organic Waste Treatment or RecoveryIn 1989, 22 facilities accepted 147

million gallons of organic wastewaterfor treatment. Most facilities withtreatment on-site used some form ofbiological treatment to handle thewastewater. Most of the facilities in theOrganics Subcategory have otherindustrial operations as well, and theCWT wastes are mixed with thesewastewater prior to treatment. Therelatively constant on-site wastewatercan support the operation ofconventional, continuous biologicaltreatment processes, which otherwisecould be upset by the variability of theoff-site waste receipts.

IV. Summary of EPA Activities andData Gathering Efforts

A. EPA’s Initial Efforts to Develop aGuideline for the Waste TreatmentIndustry

In 1986, the Agency initiated a studyof waste treatment facilities whichreceive waste from off-site for treatment,recovery, or disposal. The Agency

looked at various segments of the wastemanagement industry includingcentralized waste treatment facilities,landfills, incinerators, fuel blendingoperations, and waste solidification/stabilization processes (PreliminaryData Summary for the Hazardous WasteTreatment Industry, EPA 1989). EPAconducted a separate study of theSolvent Recycling Industry (PreliminaryData Summary for the Solvent RecyclingIndustry, EPA 1989).

Development of effluent limitationsguidelines and standards for thisindustry began in 1989. EPA originallystudied centralized waste treatmentfacilities, fuel blending operations andwaste solidification/stabilizationfacilities. EPA has decided not topropose nationally applicable effluentlimitations guidelines and standards forfuel blending and stabilizationoperations because, even though theseoperations are integral to a facility’swaste management practices,wastewater generation and disposalpractices are not similar to theoperations of centralized wastetreatment operations. Most fuelblending and stabilization processes are‘‘dry,’’ i.e., they generate no wastewater.Therefore, EPA decided to limit thisphase of the proposed rulemaking to thedevelopment of regulations for theCentralized Waste Treatment Industry.

B. Wastewater Sampling ProgramIn the sampling program for the

Hazardous Waste Treatment IndustryStudy, twelve facilities were sampled tocharacterize the wastes received and theon-site treatment technologyperformance at incinerators, landfills,and hazardous waste treatmentfacilities. Since all of the facilitiessamples had more than one on-siteoperation, the data collected can not beused for this project because data werecollected for mixed waste streams andthe waste characteristics and treatmenttechnology performance for thehazardous waste treatment facilitiescannot be differentiated.

Between 1989 and 1993, EPA visited26 of the 85 centralized waste treatmentfacilities. During each visit, EPAgathered information on waste receipts,waste and wastewater treatment, anddisposal practices. Based on these dataand the responses to the 1991 WasteTreatment Industry Questionnaire, EPAselected eight of the 26 facilities for thewastewater sampling program in orderto collect data to characterize dischargesand the performance of their treatmentsystem. Using data supplied by thefacilities, EPA applied four criteria ininitially choosing which facilities tosample. The criteria were as follows:


whether the wastewater treatmentsystem (1) was effective in removingpollutants; (2) treated wastes receivedfrom a variety of sources, (3) employedeither novel treatment technologies orapplied traditional treatmenttechnologies in a novel manner, and (4)applied waste management practicesthat increased the effectiveness of thetreatment unit. An additional facilitywas sampled to characterize the wastesreceived and treatment processes of afacility that treated only non-hazardouswaste. From the data collected at thenon-hazardous waste treatment facility,waste stream characteristics weresimilar to that of a facility that treatshazardous waste. The other 17 facilitiesvisited were not sampled, because theydid not meet these criteria.

During each sampling episode, facilityinfluent and effluent streams weresampled. Samples were also taken atintermediate points to assess theperformance of individual treatmentunits. This information is summarizedin the Technical DevelopmentDocument. In the first two samplingepisodes, streams were analyzed forover 480 pollutants to identify the rangeof pollutants possible at these facilities.After the analytical data were reviewedfor the first two sampling episodes, thenumber of pollutants analyzed werereduced to approximately 180 that weredetected in the initial sampling efforts.

In 1994, an additional four facilitieswere visited that are not included in the85 Centralized Waste Treatmentfacilities identified in 1989. Thesefacilities were not in business at thetime the questionnaire was mailed.These facilities specialized in thetreatment of bilge waters and unstableoil-water mixtures. From these sitevisits, one facility was chosen to besampled based on the on-site treatmentand type of oily waste accepted fortreatment. As previously discussed, thedata has not been reviewed at the timeof this proposal, but the data is includedin the regulatory record and will beevaluated prior to promulgation.

1. Metal-Bearing Waste Treatment andRecovery Sampling

From the ten sampling episodescompleted from 1989 to 1994, only sixsampling episodes contained datawhich were used to characterize thissubcategory’s waste streams andtreatment technology performance. Allof the facilities used some form ofprecipitation for treatment of the metal-bearing waste streams. Only one facilitywas a direct discharger and wastherefore designed to effectively treatthe conventional pollutants important

for this subcategory, TSS and Oil andGrease.

2. Oily Waste Treatment and RecoverySampling

From the sampling data collectedbetween 1989 and 1994, five samplingepisodes contained data which areapplicable to the treatment of oilywastes. Data for the remaining fivesampling episodes could not be usedbecause the facilities did not accept oilywaste for treatment or recovery.Identification of facilities to be sampledwas difficult because most facilities inthe oily waste treatment subcategoryhad other centralized waste treatmentprocesses on-site. Three of the fourfacilities had other on-site CentralizedWaste Treatment processes. The oilywastewater after emulsion-breaking wascommingled with other subcategorywaste streams prior to further treatmentof the oily waste stream. In all threecases most of the pollutants of concernthat were detected prior to comminglingwere at a non-detect level aftercommingling. Therefore, dilutionresulted from the mixing and no furthertreatment may have occurred. Data fromthe three facilities could be used only tocharacterize the untreated waste streamsafter emulsion-breaking. Data from oneof the facilities could not be evaluatedprior to this proposal but is included inthe public record. Therefore, data fromonly one facility could be used to assesstreatment performance at the facilitiesin this subcategory.

3. Organic Waste Treatment andRecovery Sampling

Similar to the case with the OilyWaste Subcategory, identification offacilities for assessing waste streams andtreatment technology performance wasdifficult, because most organic wastetreatment facilities had other industrialoperations on-site. The centralizedwaste treatment waste streams weresmall in comparison to the overall siteflow. Two facilities were identified andsampled which treated a significantportion of off-site generated organicwaste streams. Data from one of thefacilities could not be used whendeveloping technology options forproposal because the treatment systemperformance was not optimal at the timeof sampling, but data from this facilitywas used to characterize the raw wastestreams.

Therefore, sampling data from onefacility was used to determine thetreatment technology basis for thissubcategory.

C. 1991 Waste Treatment IndustryQuestionnaire (Census of the Industry)

Under the authority of Section 308 ofthe Clean Water Act, EPA sent aquestionnaire in 1991 to 455 facilitiesthat the Agency had identified aspossible Centralized Waste Treatmentfacilities. Since the Centralized WasteTreatment Industry is not representedby a SIC code, identification of facilitieswas difficult. Directories of treatmentfacilities, Agency information, andtelephone directories were used toidentify the 455 facilities to which thequestionnaires were mailed. Theresponses from 416 facilities indicatedthat 89 facilities treated, or recoveredmaterial from, industrial waste from off-site in 1989 and the remaining 327facilities did not treat, or recovermaterials from, industrial waste fromoff-site. Out of the 89 facilities thatreceived industrial waste from off-sitefor treatment, four facilities received allof the off-site waste via pipeline. For thereasons discussed previously, thisproposed regulation does not coverwaste transferred from the originalsource of generation by pipeline.Therefore, based on this data base, 85facilities are currently in the scope ofthis regulation. The questionnairespecifically requested information on:(1) the type of wastes accepted fortreatment; (2) the industrial wastemanagement practices used; (3) thequantity, treatment, and disposal ofwastewater generated during industrialwaste management; (4) availableanalytical monitoring data onwastewater treatment; (5) the degree ofco-treatment (treatment of centralizedwaste treatment wastewater withwastewater from other industrialoperations at the facility); and (6) theextent of wastewater recycling and/orreuse at the facility. Information wasalso obtained through follow-uptelephone calls and written requests forclarification of questionnaire responses.Information obtained by the 1991 WasteTreatment Industry Questionnaire issummarized in the TechnicalDevelopment Document for today’sproposed rule.

D. Detailed Monitoring Questionnaire(Follow-Up Questionnaire to a Subset ofthe Industry)

EPA also requested a subset ofcentralized waste treatment facilities tosubmit wastewater monitoring data inthe form of individual data points ratherthan monthly aggregates. Thesewastewater monitoring data includedinformation on pollutant concentrationsand waste receipt data for a six weekperiod. The waste receipt data were


collected to provide information aboutthe types of wastes treated and theinfluent waste characteristics due to theabsence of influent wastewatermonitoring data. Data were requestedfrom 19 facilities.

V. Development of Effluent LimitationsGuidelines and Standards

A. Industry Subcategorization

1. Development of CurrentSubcategorization Scheme

For today’s proposal, EPA consideredwhether a single set of effluentlimitations and standards should beestablished for this industry or whetherdifferent limitations and standards wereappropriate for subcategories within theindustry. In its preliminary decisionthat subcategorization is required and indeveloping the subcategories set forth inthis rulemaking, EPA took into accountall the information it collected anddeveloped with respect to the followingfactors: waste type received; treatmentprocess; nature of wastewater generated;facility size, age, and location; non-water quality impact characteristics; andtreatment technologies and costs. In thisindustry, a wide variety of wastes aretreated at a typical facility. Facilitiesemploy different waste treatmenttechnologies tailored to the specific typeof waste being treated in a given day.

EPA concluded a number of factorsdid not provide an appropriate basis forsubcategorization. The Agencyconcluded that the age of a facilityshould not be a basis forsubcategorization because many olderfacilities have unilaterally improved ormodified their treatment process overtime. Facility size is also not a usefulbasis for subcategorization for theCentralized Waste Treatment Industrybecause wastes can be treated to thesame level regardless of the facility size.Likewise, facility location is not a goodbasis for subcategorization; noconsistent differences in wastewatertreatment performance or costs existbecause of geographical location.Although non-water qualitycharacteristics (solid waste and airemission effects) are of concern to EPA,these characteristics did not constitute abasis for subcategorization.Environmental impacts from solid wastedisposal and from the transport ofpotentially hazardous wastewater are aresult of individual facility practicesand do not reflect a trend that pertainsto different segments of the industry.Treatment costs do not appear to be abasis for subcategorization because costswill vary and are dependent on thefollowing waste stream variables: flowrates, wastewater quality, and pollutant

loadings. Therefore, treatment costswere not used as a factor in determiningsubcategories.

EPA identified only one factor withprimary significance for subcategorizingthe Centralized Waste TreatmentIndustry: the type of waste received fortreatment or recovery. This factorencompasses many of the othersubcategorization factors. The type oftreatment processes used, nature ofwastewater generated, solids generated,and potential air emissions directlycorrelate to the type of wastes receivedfor treatment or recovery. Therefore,EPA has concluded that the type ofwaste received for treatment or recoveryis the appropriate basis forsubcategorization of this industry. EPAinvites comment on whether thespecific subcategories proposed todayshould be further subdivided intosmaller subcategories or whether analternative basis for categorizationshould be adopted.

2. Proposed SubcategoriesBased on the type of wastes accepted

for treatment or recovery, EPA hasdetermined that there are threesubcategories appropriate for theCentralized Waste Treatment Industry.

• Subcategory A: Facilities whichtreat, or treat and recover metal from,metal-bearing waste received from off-site,

• Subcategory B: Facilities whichtreat, or treat and recover oil from, oilywaste received from off-site, and

• Subcategory C: Facilities whichtreat, or treat and recover organics from,other organic waste received from off-site.

a. Discharges from metal-bearingwaste treatment and recoveryoperations. Metal-bearing wastesrepresent the largest volume of wastestreated at the facilities which are thesubject of this guidelines developmenteffort. Included within this subcategoryare facilities which treat metal-bearingwastes received from off-site as well asfacilities which recover metals from off-site metal-bearing waste streams.Currently, EPA has identified 56facilities as treating metal-bearingwastes. A small percentage of thesefacilities recover metals from the wastesfor sale in commerce or for return toindustrial processes. EPA proposes toestablish limitations and standards forthose conventional, priority, and non-conventional pollutants discharged inthis subcategory. Among the metal-bearing wastes typically treated at thefacilities in this subcategory are, insome cases, highly-concentrated,complex cyanide waste streams. In thecase of CWTs that treat complex

cyanides, based on the results of its sitevisits and data sampling effort, EPA hasinitially concluded that without firstachieving a given level of cyanidereduction prior to metals treatment, thepresence of cyanide will interfere withsubsequent metals treatment, thusjeopardizing achievement of attainableeffluent metals removals.

b. Discharges from oily wastetreatment and recovery operations. EPAidentified 35 facilities that currentlydischarge wastewater from treatmentand recovery operations for oily wastes.EPA proposes to regulate conventional,priority, and non-conventionalpollutants in wastewater dischargedfrom this subcategory.

c. Discharges from organic wastetreatment operations. EPA identified 22facilities that currently dischargewastewater from the treatment oforganic wastes that are received at thefacility from off-site for treatment. Asexplained previously, wastewaterdischarges from organic recoveryprocess operations, such as solventrecovery, are not included within thescope of this regulation. EPA proposesto regulate the conventional, priority,and non-conventional pollutantswastewater discharges from thissubcategory.

B. Characterization of WastewaterThis section describes current water

use and wastewater characterization atthe 85 centralized waste treatmentfacilities in the U.S. All waste treatmentprocesses covered by this regulationtypically involve the use of water;however, specifics for any facilitydepend on the facility’s waste receiptsand treatment processes.

1. Water and Sources of WastewaterApproximately 2.0 billion gallons of

wastewater are generated annually atcentralized waste treatment facilities. Itis difficult to determine the quantity ofwastes attributable to different sourcesbecause generally facilities mix thewastewater prior to treatment. EPA has,as a general matter, however, identifiedthe sources described below ascontributing to wastewater discharges atcentralized waste treatment operationsthat would be subject to the proposedeffluent limitations and standards.

a. Waste receipts. Most of the wastereceived from customers comes in aliquid form and constitutes a largeportion of the wastewater treated at afacility. Other wastewater sourcesinclude wastewater from contact withthe waste at receipt or duringsubsequent handling.

b. Solubilization water. A portion ofwaste receipts are in a solid form. Water


2 Process wastewater is defined in 40 CFR 122.2as ‘‘any water which, during manufacturing orprocessing, comes into direct contact with or resultsfrom the production or use of any raw material, by-product, intermediate product, finished product, orwaste product.’’

may be added to the waste to render ittreatable.

c. Waste oil emulsion-breakingwastewater. The emulsion breakingprocess separates difficult water-oilemulsions and generates a ‘‘bottom’’ orwater phase. Approximately 99.2million gallons of wastewater weregenerated from emulsion-breakingprocesses in 1989.

d. Tanker truck/drum/roll-off boxwashes. Water is used to clean theequipment used for transporting wastes.The amount of wastewater generatedwas difficult to assess because the washwater is normally added to the wastesor used as solubilization water.

e. Equipment washes. Water is used toclean waste treatment equipment duringunit shut downs or in between batchesof waste.

f. Air pollution control scrubber blow-down. Water or acidic or basic solutionis used in air emission control scrubbersto control fumes from treatment tanks,storage tanks, and other treatmentequipment.

g. Laboratory-derived wastewater.Water is used in on-site laboratorieswhich characterize incoming wastestreams and monitor on-site treatmentperformance.

h. Contaminated stormwater. This isstormwater which comes in directcontact with the waste or wastehandling and treatment areas.(Stormwater which does not come intocontact with the wastes would not besubject to today’s proposed limitationsand standards.)

2. Wastewater DischargeApproximately 3 billion gallons of

wastewater were discharged atCentralized Waste Treatment Industryoperations in 1989. In general, theprimary source of wastewater dischargesfrom these facilities are: waste receipts,solubilization wastewater, tanker truck/drums/roll-off box washes, equipmentwashes, air pollution control scrubberblow-down, laboratory-derivedwastewater, and contaminatedstormwater. Centralized waste treatmentfacilities do not generate a ‘‘processwastewater’’ in the traditional sense ofthis term.2 As a service industry, thereis no manufacturing or commercial‘‘process’’ which is generating water.Because there are no ‘‘manufacturingprocesses’’ or ‘‘products’’ for thisindustry, ‘‘process’’ wastewater for thisindustry will include any wastes

received for treatment (‘‘waste receipt’’)as well as water which comes intocontact with the waste received or wasteprocessing area. The wastewaterresulting from contact with the wastesor waste processing area is referred to bythe short-hand term ‘‘centralized wastetreatment wastewater.’’

The 85 facilities identified by the1991 Waste Treatment IndustryQuestionnaire can also be characterizedby their type of wastewater discharge.Sixteen facilities discharge wastewaterdirectly into a receiving stream or bodyof water. Another 56 facilities dischargewastewater indirectly, i.e., discharge toa publicly-owned treatment works(POTW).

Thirteen facilities do not dispose ofwastewater directly to surface waters orindirectly to POTWs. At these facilities,(1) wastewater is disposed of byalternate means such as on-site or off-site deep well injection or incineration(four facilities); (2) wastewater is sentoff-site for treatment (six facilities); (3)the process does not generatewastewater (one facility); and (4)wastewater is evaporated (twofacilities). One facility dischargeswastewater directly as well as on-sitedeep well injection.

This regulation applies to direct andindirect discharges only.

3. Wastewater CharacterizationThe Agency’s sampling program for

this industry detected over 100pollutants (conventional, priority, andnon-conventional) in waste streams attreatable levels. The quantity ofpollutants currently being discharged isdifficult to assess due to the lack ofmonitoring data available from facilitiesfor the list of pollutants identified fromthe Agency’s sampling program prior tocommingling of the wastewater withnon-contaminated stormwater and otherindustrial wastewater before discharge.Methodologies were developed toestimate current performance for eachsubcategory by assessing performance ofon-site treatment technologies,wastewater permit information, andmonitoring data supplied in the 1991Waste Treatment IndustryQuestionnaire and the DetailedMonitoring Questionnaire. For theMetals Subcategory, a ‘‘non-processwastewater’’ factor was used to quantifythe amount of non-contaminatedstormwater and other industrial processwater in a facility’s discharge. Afacility’s current discharge of treatedCentralized Waste Treatmentwastewater was calculated using themonitoring data supplied multiplied bythe ‘‘non-process wastewater’’ factor.For the Oils Subcategory, present

treatment schemes were studied. Mostfacilities mixed oily wastewater withother CWT or industrial wastewater orstormwater. This generally resulted ininadequate treatment of oily wastebecause the pollutants detected in oilywastewater were typically not detectedin the untreated mixed streams due todilution. Therefore, current performancewas estimated at the point prior tomixing different types of wastewater.For the Organics Subcategory, currentperformance could not be estimatedfrom the discharge monitoring datasubmitted by the facilities due to thepresence of other industrial wastewaterin the discharge. Current performancewas estimated by projecting the removalof pollutants resulting from thetechnologies used on-site. The Agencyis soliciting comments on theapproaches used to calculate the currentperformance as well as requesting anymonitoring data available before theaddition of non-contaminatedstormwater or other industrialwastewater.

C. Pollutants Not RegulatedEPA is not proposing effluent

limitations or standards for allconventional, priority, and non-conventional pollutants in thisproposed regulation. Among the reasonsEPA may have decided not to proposeeffluent limitations for a pollutant arethe following:

(a) The pollutant is deemed notpresent in Centralized Waste TreatmentIndustry wastewater, because it was notdetected in the influent during theAgency’s sampling/data gatheringefforts with the use of analyticalmethods promulgated pursuant toSection 304(h) of the Clean Water Act orwith other state-of-the-art methods.

(b) The pollutant is present only intrace amounts and is neither causing norlikely to cause toxic effects.

(c) The pollutant was detected in theeffluent from only one or a smallnumber of samples and the pollutant’spresence could not be confirmed.

(d) The pollutant was effectivelycontrolled by the technologies used as abasis for limitations on other pollutants,including those limitations proposedtoday, and therefore regulated by thelimitations for the indicator pollutantsor (e) Insufficient data are available toestablish effluent limitations.

D. Available TechnologiesThe treatment technologies presently

employed by the industry represent therange of wastewater treatment systemsobserved at categorical industrialoperations. All 85 centralized wastetreatment facilities operate wastewater


treatment systems. The technologiesused include physical-chemicaltreatment, biological treatment, andadvanced wastewater treatment. Basedon information obtained from the 1991Waste Treatment IndustryQuestionnaire and site visits, EPA hasconcluded that a significant number ofthese treatment systems need to beupgraded to improve effectiveness andto remove additional pollutants.

Physical-chemical treatmenttechnologies in use are:

• Precipitation/Filtration, whichconverts soluble metal salts to insolublemetal oxides which are then removed byfiltration;

• Dissolved Air Flotation (DAF),which separates solid or liquid particlesfrom a liquid phase by introducing airbubbles into the liquid phase. Thebubbles attach to the particles and riseto the top of the mixture;

• Activated Carbon, which removespollutants from wastewater byadsorbing them onto carbon particles;

• Multi-media/Sand Filtration, whichremoves solids from wastewater bypassing it through a porous medium.Biological treatment technologies in useare:

• Sequential Batch Reactor, whichuses microorganisms to degrade organicmaterial in a batch process;

• Activated Sludge, which usesmicroorganisms suspended in well-aerated wastewater to degrade organicmaterial;

• PACT System, a patented processin which powder activated carbon isadded to an activated sludge system;and

• Coagulation/Flocculation, which isused to assist clarification of biologicaltreatment effluent.

Advanced wastewater treatmenttechnologies in use are:

• Ultrafiltration, which is used toremove organic pollutants fromwastewater according to the organicmolecule size; and

• Reverse osmosis, which relies ondifferences in dissolved solidsconcentrations to remove inorganicpollutants from wastewater.

The typical treatment sequence for afacility depends upon the type of wasteaccepted for treatment. Most facilitiestreating metal-bearing wastes useprecipitation/filtration to removemetals. Those that treat oily wastesrelied on dissolved air flotation largelyto remove oil and grease, but thistechnology is typically ineffective inremoving the metal pollutants that arein many cases also present in thesewastewater. Aerobic batch processesand types of conventional activatedsludge systems were the most widely-

found treatment technology for theorganic-bearing wastes.

E. Rationale for Selection of ProposedRegulations

To determine the technology basisand performance level for the proposedregulations, EPA developed a databaseconsisting of daily effluent datacollected from the Detailed MonitoringQuestionnaire and the EPA WastewaterSampling Program. This database isused to support the BPT, BCT, BAT,NSPS, PSES, and PSNS effluentlimitations and standards proposedtoday.

1. BPTa. Introduction. EPA today is

proposing BPT effluent limitations forthe three discharge subcategories for theCentralized Waste Treatment Industry.The BPT effluent limitations proposedtoday would control identifiedconventional, priority, and non-conventional pollutants whendischarged from CWT facilities.

b. Rationale for BPT limitations bysubcategory. As previously noted, theCentralized Waste Treatment Industryreceives for treatment large quantities ofconcentrated hazardous and non-hazardous industrial waste whichresults in discharges of a significantquantity of pollutants. The EPAestimates that 176.8 million pounds peryear of pollutants are currently beingdischarged directly or indirectly.

As previously discussed, Section304(b)(1)(A) requires EPA to identifyeffluent reductions attainable throughthe application of ‘‘best practicablecontrol technology currently availablefor classes and categories of pointsources.’’ The Senate Report for the1972 amendments to the CWAexplained how EPA must establish BPTeffluent reduction levels. Generally,EPA determines BPT effluent levelsbased upon the average of the bestexisting performances by plants ofvarious sizes, ages, and unit processeswithin each industrial category orsubcategory. In industrial categorieswhere present practices are uniformlyinadequate, however, EPA maydetermine that BPT requires higherlevels of control than any currently inplace if the technology to achieve thoselevels can be practicably applied. ALegislative History of the Federal WaterPollution Control Act Amendments of1972, p. 1468.

In addition, CWA Section 304(b)(1)(B)requires a cost effectiveness assessmentfor BPT limitations. This inquiry doesnot limit EPA’s broad discretion toadopt BPT limitations that areachievable with available technology

unless the required additionalreductions are ‘‘wholly out ofproportion to the costs of achievingsuch marginal level of reduction.’’ ALegislative History of the WaterPollution Control Act Amendments of1972, p. 170. Moreover, the inquiry doesnot require the Agency to quantifybenefits in monetary terms. See e.g.American Iron and Steel Institute v.EPA, 526 F. 2d 1027 (3rd Cir., 1975).

In balancing costs against the benefitsof effluent reduction, EPA considers thevolume and nature of expecteddischarges after application of BPT, thegeneral environmental effects ofpollutants, and the cost and economicimpacts of the required level ofpollution control. In developingguidelines, the Act does not require orpermit consideration of water qualityproblems attributable to particular pointsources, or water quality improvementsin particular bodies of water. Therefore,EPA has not considered these factors indeveloping the limitations beingproposed today. See WeyerhaeuserCompany v. Costle, 590 F. 2d 1011 (D.C.Cir. 1978).

EPA concluded that the wastewatertreatment performance of the facilities itsurveyed was, with very limitedexceptions, uniformly poor. Under thesecircumstances, for each subcategory,EPA has preliminarily concluded thatonly one treatment system meets thestatutory test for best practicable,currently available technology. EPA hasdetermined that the performance offacilities which mix different types ofhighly concentrated CWT wastes withnon-CWT waste streams or withstormwater are not providing BPTtreatment. The mass of pollutants beingdischarged is unacceptably high, giventhe demonstrated removal capacity oftreatment systems that the Agencyreviewed. Thus, comparison of EPAsampling data and CWT industry-supplied monitoring informationestablishes that, in the case of metal-bearing waste streams, virtually all thefacilities are discharging large totalquantities of heavy metals. As measuredby total suspended solids (TSS) levelsfollowing treatment, TSS concentrationsare substantially in excess of levelsobserved at facilities in other industrycategories employing the sametreatment technology—10 to 20 timesgreater than observed for other pointsource categories.

In the case of oil discharges, mostfacilities are achieving low removal ofoils and grease relative to theperformance required for other pointsource categories. Further, facilitiestreating organic wastes, whilesuccessfully removing organic


pollutants through biological treatment,fail to remove metals associated withthese organic wastes.

The poor pollutant removalperformance observed generally fordischarging CWT facilities is notunexpected. As pointed out previously,these facilities are treating highlyconcentrated wastes that, in many cases,are process residuals and sludges fromother point source categories. EPA’sreview of permit limitations for thedirect dischargers show that, in mostcases, the dischargers are subject to‘‘best professional judgment’’concentration limitations which weredeveloped from guidelines for facilitiestreating and discharging much moredilute waste streams. EPA hasconcluded that treatment performancein the industry is widely inadequate andthat the mass of pollutants beingdischarged is unacceptably high, giventhe demonstrated removal capability oftreatment operations that the Agencyreviewed.

(i) Subcategory A—MetalsSubcategory. The Agency is todayproposing BPT limitations for theMetals Subcategory for 22 pollutants.EPA considered three regulatory optionsto reduce the discharge of pollutants bycentralized waste treatment facilities.For a more detailed discussion of thebasis for the limitations andtechnologies selected see the TechnicalDevelopment Document.

The three currently availabletreatment systems for which the EPAassessed performance for the MetalsSubcategory BPT are:

• Option 1—Chemical Precipitation,Liquid-Solid Separation, and SludgeDewatering. Under Option 1, BPTlimitations would be based uponchemical precipitation with a lime/caustic solution followed by some formof separation and sludge dewatering tocontrol the discharge of pollutants inwastewater. The data reviewed for thisoption showed that settling/clarificationfollowed by pressure filtration of sludgeyields removals equivalent to pressurefiltration. In some cases, BPT limitationswould require the current treatmenttechnologies in-place to be improved byuse of increased quantities of treatmentchemicals and additional monitoring ofbatch processes. For metals streamswhich contain concentrated cyanidecomplexes, BPT limitations underOption 1 are based on alkalinechlorination at specific operatingconditions prior to metals treatment. Aspreviously noted, without treatment ofthe cyanide streams prior to metalstreatment, metals removal aresignificantly reduced.

• Option 2—Selective MetalsPrecipitation, Pressure Filtration,Secondary Precipitation, and Solid-Liquid Separation. The second optionevaluated for BPT for centralized wastetreatment facilities would be based onthe use of numerous treatment tanksand personnel to handle incoming wastestreams, and use of greater quantities ofcaustic in the treatment chemicalmixture. (Caustic sludge is easier torecycle.) Option 2 is based on additionaltanks and personnel to segregateincoming waste streams and to monitorthe batch treatment processes tomaximize the precipitation of specificmetals in order to generate a metal-richfilter cake. The metal-rich filter cakecould possibly be sold to metal smeltersto incorporate into metal products. LikeOption 1, for metals streams whichcontain concentrated cyanidecomplexes, under Option 2, BPTlimitations are also based on alkalinechlorination at specific operatingconditions prior to metals treatment.

• Option 3—Selective MetalsPrecipitation, Pressure Filtration,Secondary Precipitation, Solid-LiquidSeparation, and Tertiary Precipitation.The technology basis for Option 3 is thesame as Option 2 except an additionalprecipitation step at the end oftreatment is added. For metals streamswhich contain concentrated cyanidecomplexes, like Options 1 and 2, forOption 3, alkaline chlorination atspecific operating conditions would alsobe the basis for BPT limitations.

The Agency is proposing to adoptBPT effluent limitations based onOption 3 for the Metals Subcategory.These limitations were developed basedon an engineering evaluation of theaverage of the best demonstratedmethods to control the discharges of theregulated pollutants in this Subcategory.

EPA’s decision to base BPTlimitations on Option 3 treatmentreflects primarily an evaluation of threefactors: the degree of effluent reductionattainable, the total cost of the proposedtreatment technologies in relation to theeffluent reductions achieved, andpotential non-water quality benefits. Inassessing BPT, EPA considered the age,size, process, other engineering factors,and non-water quality impacts pertinentto the facilities treating wastes in thissubcategory. No basis could be found foridentifying different BPT limitationsbased on age, size, process or otherengineering factors. Neither the age northe size of the CWT facility will directlysignificantly affect either the characteror treatability of the CWT wastes or thecost of treatment. Further, the treatmentprocess and engineering aspects of thetechnologies considered have a

relatively insignificant effect because inmost cases they represent fine tuning oradd-ons to treatment technology alreadyin use. These factors consequently didnot weigh heavily in the development ofthese guidelines. For a service industrywhose service is wastewater treatment,the most pertinent factors forestablishing the limitations are costs oftreatment, the level of effluentreductions obtainable, and non-waterquality effects.

Generally, for purposes of definingBPT effluent limitations, EPA looks atthe performance of the best operatedtreatment system and calculateslimitations from some level of averageperformance of these ‘‘best’’ facilities.For example, in the BPT limitations forthe Organic Chemicals, Plastics, andSynthetic Fibers Point Source Category,EPA identified ‘‘best’’ facilities on aBOD performance criteria of achieving a95 percent BOD removal or a BODeffluent level of 40 mg/l. 52 FR 42535(November 5, 1987). For this industry,as previously explained, EPA concludedthat treatment performance is, invirtually all cases, poor. Withoutseparation of metal-bearing streams forselective precipitation, metal removallevels are uniformly inadequate acrossthe industry. Consequently, BPTperformance levels are based on datafrom the one well-operated system usingselective metals precipitation that wassampled by EPA.

The demonstrated effluent reductionsattainable through the Option 3 controltechnology represent the BPTperformance attainable through theapplication of demonstrated treatmentmeasures currently in operation in thisindustry. The Agency is proposing toadopt BPT limitations based on theremoval performance of the Option 3treatment system for the followingreasons. First, these removals aredemonstrated by a facility in thissubcategory and can readily be appliedto all facilities in the subcategory. Theadoption of this level of control wouldrepresent a significant reduction inpollutants discharged into theenvironment.

Second, the Agency assessed the totalcost of water pollution controls likely tobe incurred for Option 3 in relation tothe effluent reduction benefits anddetermined these costs wereeconomically reasonable.

Third, adoption of these BPT limitscould promote the non-water qualityobjectives of the CWA. Use of theOption 3 treatment regime—whichgenerates a metal-rich filter cake thatmay be recovered and smelted—couldreduce the quantity of waste which arebeing disposed of in landfills.


The Agency proposes to reject Option1 because, as discussed above, EPAconcluded that mixing disparate metal-bearing waste streams is not the bestpracticable treatment technologycurrently in operation for thissubcategory of the industry.Consequently, effluent levels associatedwith this treatment option would notrepresent BPT performance levels.Option 2 was rejected, although similarto Option 3, because the greaterremovals obtained through addition oftertiary precipitation at Option 3 wereobtained at a relatively insignificantincrease in costs over Option 2.

See Section V.F. for furtherinformation regarding Monitoring toDemonstrate Compliance with theRegulation.

(ii). Subcategory B—Oils Subcategory.The Agency is today proposing BPTlimitations for the Oils Subcategory for33 pollutants. EPA identified fourregulatory options for consideration inestablishing BPT effluent reductionlevels for this subcategory of theCentralized Waste Treatment Industry.For a more detailed discussion of thebasis for the limitations and standardsselected see the Technical DevelopmentDocument.

The four technology optionsconsidered for the Oils Subcategory BPTare:

• Option 1—Emulsion-Breaking.Under Option 1, BPT limitations wouldbe based on present performance ofemulsion-breaking processes using acidand heat to separate oil-wateremulsions. At present, most facilitieshave this technology in-place unlessless stable oil-water mixtures areaccepted for treatment. Stable oil-wateremulsions require some emulsion-breaking treatment because gravity orflotation alone is inadequate to breakdown the oil/water stream.

• Option 2—Ultrafiltration. UnderOption 2, BPT limitations would bebased on the use of ultrafiltration fortreatment of less concentrated, stableoily waste receipts or for the additionaltreatment of wastewater from theemulsion-breaking process.

• Option 3—Ultrafiltration, CarbonAdsorption, and Reverse Osmosis. TheOption 3 BPT effluent limitations arebased on the use of carbon adsorptionand reverse osmosis in addition to theOption 2 technology. The reverseosmosis unit removes metal compoundsfound at significant levels for thissubcategory. Inclusion of a carbonadsorption unit is necessary in order toprotect the reverse osmosis unit byfiltering out large particles which maydamage the reverse osmosis unit ordecrease membrane performance.

• Option 4—Ultrafiltration, CarbonAdsorption, Reverse Osmosis, andCarbon Adsorption. Option 4 is similarto Option 3 except for the additionalcarbon adsorption unit for final effluentpolishing.

The Agency is proposing BPT effluentlimitations for the Oily WasteSubcategory based on Option 3 as wellas Option 2 treatment systems. EPA haspreliminarily concluded that bothoptions represent best practicablecontrol technologies. The technologiesare in-use in the industry and the datacollected by the Agency show that thelimitations are being achieved. Inassessing BPT, EPA considered age,size, process, other engineering factors,and non-water quality impacts pertinentto the facilities treating wastes in thissubcategory. No basis could be found foridentifying different BPT limitationsbased on age, size, process or otherengineering factors for the reasonspreviously discussed. For a serviceindustry whose service is wastewatertreatment, the pertinent factors here forestablishing the limitations are costs oftreatment, the level of effluentreductions obtainable, and non-waterquality effects.

Among the options considered by theAgency, both Options 2 and 3 wouldprovide for significant reductions inregulated pollutants discharged into theenvironment over current practice in theindustry represented by Option 1. EPAis nonetheless, concerned about the costof Option 3 because it is substantiallymore expensive than Option 2.However, EPA’s economic assessmentindicates, that Options 2 and 3 areeconomically reasonable.

As noted, the Agency is proposingOption 2 because it is a currentlyavailable and cost-effective treatmentoption. However, the BPT pollutantremoval performance required for anumber of specific pollutants(particularly oil and grease and metals)is less stringent than current BPTeffluent limitations guidelinespromulgated for other industries. EPA isconcerned about the potential forencouraging off-site shipment of oilywaste now being treated on-site if thelimitations for this subcategory aresignificantly different from those otherBPT effluent limitations currently ineffect.

EPA is proposing both options forcomment because the Agency isconcerned that, while both Options 2and 3 are proven treatment technologiescurrently available to this industry, theadditional effluent reductionsassociated with Option 3 are veryexpensive. EPA has preliminarilyconcluded that, even though the cost of

Option 3 is significantly greater thanOption 2 (because of installation,operation, and maintenance of reverseosmosis equipment), the costs are notunreasonable, given other factors. EPAis asking for comment on whether theeffluent reduction benefits of Option 3outweigh the high cost of the additionalremoval obtained through reverseosmosis. The Agency is particularlyinterested in comments on the ancillaryeffects of the less stringent Option 2limitations.

As previously discussed, the Agencywill be re-estimating the currentperformance at facilities that treat oilywaste based on comments received andinformation collected in the August1994 sampling episode and re-calculating the cost and impacts ofOptions 2 and 3. The data from theAugust 1994 sampling episode isincluded in the record for this proposal,but was not incorporated intocalculations because it was not receivedwith sufficient time to review andincorporate.

The Agency proposes to reject Option1, because the technology does notprovide for adequate control of theregulated pollutants. The Agency alsoproposes to reject Option 4 becauseOption 4 treatment technology results ina lower level of pollutant reductions incomparison to Option 3. Theoretically,Option 4 should provide for themaximum reduction of pollutantsdischarged due to the addition of carbonadsorption units, but specific pollutantconcentrations increase across thecarbon adsorption unit according to theanalytical data collected.

Even though, as previously explained,BPT limitations are generally defined bythe average effluent reductionperformance of the best existingtreatment systems, here, as was the casewith the BPT metal-bearing wasteslimitations, the options being proposedas the basis for BPT effluent limitationsare based upon the treatmentperformance at a single facility. EPAconcluded that existing performance atthe other facilities is uniformlyinadequate because many facilities thatwill be subject to the limitations for theOily Waste Subcategory now comminglethe oily wastewater with other wastesprior to treatment. The Agency hasdetermined that the practice of mixingwaste streams before treatment resultsin inadequate removal of the regulatedpollutants of concern for the OilsSubcategory. Oily wastewater containssignificant levels of organic and metalscompounds. If the oily wastewater ismixed with other CWT wastewater,these organic and metals compounds areoften found at non-detectable levels


prior to treatment because the oilywastewater is effectively diluted by theother wastewater to the point that thecompounds are no longer detectible.The treatment system on which theOptions 2 through 4 effluent limitationsare based was designed specifically forthe treatment of segregated oilywastewater.


(iii) Subcategory C—OrganicsSubcategory. The Agency is todayproposing BPT limitations for theOrganics Subcategory for 39 pollutants.EPA identified two regulatory optionsfor consideration in establishing BPTeffluent reduction levels for thissubcategory of the Centralized WasteTreatment Industry. For a more detaileddiscussion of the basis for thelimitations and technologies selectedsee the Technical DevelopmentDocument.

The two technology optionsconsidered for the Organics SubcategoryBPT are:

• Option 1—Equalization, Air-Stripping, Biological Treatment, andMulti-media Filtration. BPT Option 1effluent limitations are based on thefollowing treatment system:equalization, two air-strippers in seriesequipped with a carbon adsorption unitfor control of air emissions, biologicaltreatment in the form of a sequentialbatch reactor (which is operated on abatch basis,) and finally multi-mediafiltration units for control of solids.

• Option 2—Equalization, Air-Stripping, Biological Treatment, Multi-Filtration, and Carbon Adsorption.Option 2 is the same as Option 1 exceptfor the addition of carbon adsorptionunits.

The Agency is proposing to adoptBPT effluent limitations based on theOption 1 technology for the OrganicsSubcategory. The demonstrated effluentreductions attainable through Option 1control technology represent the bestpracticable performance attainablethrough the application of currentlyavailable treatment measures. EPA’sdecision to propose effluent limitationsdefined by the removal performance ofthe Option 1 treatment systems is basedprimarily on consideration of severalfactors: the effluent reductionsattainable, the economic achievability ofthe option and non-water qualityenvironmental benefits. Once again, theage and size of the facilities, processesand other engineering factors were notconsidered pertinent to establishment ofBPT limitations for this subcategory.

The Agency is proposing to adoptBPT limitations based on the removalperformance of the Option 1 treatmentsystem for the following reasons. First,the cost of achieving the pollutantdischarge levels associated with theOption 1 treatment system is reasonable.The annualized costs for treatment arelow.

According to the data collected, theOption 1 treatment system provides agreater effluent pollutant reduction levelthan the more expensive Option 2.Theoretically, Option 2 should providefor the maximum reduction ofpollutants discharged due to theaddition of carbon adsorption units, butspecific pollutants of concern increasedacross the carbon adsorption unitaccording to the analytical datacollected. Due to the poor performanceof carbon adsorption in EPA’s databasefor this industry, Option 2 is rejected.The poor performance may be a resultof pH fluctuations in the carbonadsorption unit resulting in thesolubilization of metals. Similar trendshave been found for all of the datacollected on carbon adsorption units inthis industry. The EPA is solicitingcomments, additional information, andperformance data on carbon adsorptionunits used within the industry.

The Agency used biological treatmentperformance data from the OCPSFregulation to establish direct dischargelimitations for BOD5 and TSS, becausethe facility from which Option 1 and 2limitations were derived is an indirectdischarger and the treatment system isnot operated to optimize removal ofconventional pollutants. EPA hasconcluded that the transfer of this datais appropriate given the absence ofadequate treatment technology for thesepollutants at the only otherwise well-operated BPT CWT facility. Given thetreatment of similar wastes at bothOCPSF and centralized waste treatmentfacilities, use of the data is warranted.Moreover, EPA has every reason tobelieve that the same treatment systemswill perform similarly when treating thewastes in this subcategory.

Once again, the selected BPT optionis based on the performance of a singlefacility. Many facilities that are treatingwastes that will be subject to effluentlimitations for the Organic-BearingWaste Subcategory also operate otherindustrial processes that generate muchlarger amounts of wastewater than thequantity of off-site generated organicwaste receipts. The off-site generatedorganic waste receipts are directlymixed with the wastewater from theother industrial processes for treatment.Therefore, identifying facilities tosample for limitations development was

difficult because the waste receipts andtreatment unit effectiveness could notbe properly characterized for off-sitegenerated waste. The treatment systemfor which Options 1 and 2 was basedupon was one of the few facilitiesidentified which treated organic wastereceipts separately from other on-siteindustrial wastewater.


2. BCTIn today’s rule, EPA is proposing

effluent limitations guidelines andstandards equivalent to the BPTguidelines for the conventionalpollutants covered under BPT. Indeveloping BCT limits, EPA consideredwhether there are technologies thatachieve greater removals ofconventional pollutants than proposedfor BPT, and whether those technologiesare cost-reasonable according to the BCTCost Test. In all three subcategories,EPA identified no technologies that canachieve greater removals ofconventional pollutants than proposedfor BPT that are also cost-reasonableunder the BCT Cost Test, andaccordingly EPA proposes BCT effluentlimitations equal to the proposed BPTeffluent limitations guidelines andstandards.

EPA may also decide to adopt BPTeffluent limitations based on treatmenttechnologies less stringent than theRegulatory Options that are the basis fortoday’s proposal. Consequently, EPAhas also evaluated the cost-reasonableness of BCT limits if EPAwere to adopt BPT limitations based onless stringent technologies. For all threecategories, this assessment does notsupport the adoption of BCT limitationsfor conventional pollutants that aremore stringent than BPT limitationsbased on a reduced level of treatment.

3. BATEPA today is proposing BAT effluent

limitations for all subcategories of theCentralized Waste Treatment Industrybased on the same technologies selectedfor BPT for each subcategory. The BATeffluent limitations proposed todaywould control identified priority andnon-conventional pollutants dischargedfrom facilities.

EPA has not identified any morestringent treatment technology optionwhich it considered to represent BATlevel of control applicable to facilities inthis industry for the metals, oils, andorganics subcategories, EPA identifiedan add-on treatment technology—carbon adsorption—that should have


further increased removals of pollutantsof concern. However, as explainedabove, EPA’s data show increases ratherthan decreases in concentrations ofspecific pollutants of concern.

In the case for the Oily WasteSubcategory, EPA is co-proposing twooptions for BAT: Options 2 and 3. EPAseeks comment on whether it shouldadopt BAT limitations based on OilsOption 3 or Oils Option 4 if the Agencydecides to adopt Option 3 for BPTlimitations for this Subcategory. Boththe Options 3 and 4 treatment systemsachieve increasingly greater levels ofpollutant removal than Option 2. Bothrepresent demonstrated technologiescurrently in use in the industry.However, the total costs for the industryover Option 2 are high. Given thestatutory injunction for the Agency todevelop BAT effluent limitations thatreflect the best control measureeconomically achievable, EPA believesBAT limitations which reflect thesemore stringent effluent pollutantreduction levels may be appropriate.This is particularly true if the additionaltreatment results in significantreduction in pollutants discharged intothe environment and thus reasonablefurther progress towards the goal of theAct—elimination of the discharge ofpollutants to navigable waters. TheAgency welcomes comment on thisissue.

EPA’s data show that the costs of bothOption 3 and Option 4 ($8.4 million and$10.0 million, respectively) aresignificantly greater than Option 2($0.87 million). Nevertheless, the cost ofper-pound removals, $0.38 and $0.44,respectively, are reasonable. In addition,both Options 3 and 4 are economicallyachievable because there would be notchange in the industry profitabilitystatus as a result of the adoption ofeither Option. As stated earlier, theimpact of limitations based on eitherOption 1, 2, 3, or 4 is a decrease inprofitability for one direct dischargerwith increased profitability for threeothers. However, adoption of BAT limitsbased on Oil Option 3 would provideapproximately 150,000 pounds ofadditional removals of pollutants overOption 2 while BAT limitations basedon costlier Option 4 would removefewer pollutants. In the circumstances,EPA has preliminarily determined thatis should not adopt Option 4 as thebasis for BAT limits if it decides to baseBPT on Option 2.

As with BPT limitations, EPA isproposing to require monitoring forcompliance with the limitations at apoint after treatment but prior tocombining the CWT process wastewaterwith other wastewater. Many facilities

operate other processes and the additionof this wastewater to CWT wastewatermay result in dilution due to thedifference in concentration of wastestreams. Also, if a facility dischargesnon-contaminated stormwater, theproposed regulation is requiringmonitoring of the CWT discharge priorto the addition of non-contaminatedstormwater.

As with BPT, monitoring forcompliance with the regulation for theTotal Cyanide limitation at facilities inthe Metals Subcategory which treatconcentrated cyanide-bearing metalwaste is after cyanide pretreatment andprior to metal treatment. This ensuresthat cyanide will not interfere withmetals treatment.


4. New Source Performance StandardsAs previously noted, under Section

306 of the Act, new industrial directdischargers must comply with standardswhich reflect the greatest degree ofeffluent reduction achievable throughapplication of the best availabledemonstrated control technologies.Congress envisioned that new treatmentsystems could meet tighter controls thanexisting sources because of theopportunity to incorporate the mostefficient processes and treatmentsystems into plant design. Therefore,Congress directed EPA to consider thebest demonstrated process changes, in-plant controls, operating methods andend-of-pipe treatment technologies thatreduce pollution to the maximum extentfeasible.

EPA is proposing NSPS that wouldcontrol the same conventional, priority,and non-conventional pollutantsproposed for control by the BPT effluentlimitations. The technologies used tocontrol pollutants at existing facilitiesare fully applicable to new facilities.Furthermore, EPA has not identified anytechnologies or combinations oftechnologies that are demonstrated fornew sources that are different fromthose used to establish BPT/BCT/BATfor existing sources. Therefore, EPA isestablishing NSPS subcategories similarto the subcategories for existingfacilities and proposing NSPSlimitations that are identical to thoseproposed for BPT/BCT/BAT. Again, theAgency is requesting comments toprovide information and data on othertreatment systems that may be pertinentto the development of standards for thisindustry.

EPA is specifically consideringwhether it should adopt NSPS for the

Oil Subcategory which reflect eitherOption 3 or Option 4 treatmenttechnologies. EPA does not believe therewould be any barriers to entry in thisindustry associated with adoption ofOption 3 or 4. One currently operatingfacility has demonstrated theperformance of these controltechnologies—EPA is assessing whetheror not to adopt NSPS for the OilSubcategory that reflects this morestringent level of control. EPA issoliciting comments on this issue.


5. Pretreatment Standards for ExistingSources

Indirect dischargers in the CentralizedWaste Treatment Industry, like thedirect dischargers, accept for treatmentwastes containing many priority andnon-conventional pollutants. As in thecase of direct dischargers, indirectdischargers may be expected todischarge many of these pollutants toPOTWs at significant mass andconcentration levels. EPA estimates thatindirect dischargers annually dischargeapproximately 85 million pounds ofpollutants.

Section 307(b) requires EPA topromulgate pretreatment standards toprevent pass-through of pollutants fromPOTWs to waters of the U.S. or toprevent pollutants from interfering withthe operation of POTWs. EPA isestablishing PSES for this industry toprevent pass-through of the samepollutants controlled by BAT fromPOTWs to waters of the U.S.

a. Pass-through analysis. Beforeproposing pretreatment standards, theAgency examines whether thepollutants discharged by the industrypass through a POTW or interfere withthe POTW operation or sludge disposalpractices. In determining whetherpollutants pass through a POTW, theAgency compares the percentage of apollutant removed by POTWs with thepercentage of the pollutant removed bydischarging facilities applying BAT. Apollutant is deemed to pass through thePOTW when the average percentageremoved nationwide by well-operatedPOTWs (those meeting secondarytreatment requirements) is less than thepercentage removed by facilitiescomplying with BAT effluentlimitations guidelines for that pollutant.

This approach to the definition ofpass-through satisfies two competingobjectives set by Congress: (1) Thatstandards for indirect dischargers beequivalent to standards for directdischargers and (2) that the treatment


capability and performance of thePOTW be recognized and taken intoaccount in regulating the discharge ofpollutants from indirect dischargers.Rather than compare the mass orconcentration of pollutants dischargedby the POTW with the mass orconcentration of pollutants dischargedby a BAT facility, EPA compares thepercentage of the pollutants removed bythe plant with the POTW removal. EPAtakes this approach because acomparison of mass or concentration ofpollutants in a POTW effluent withpollutants in a BAT facility’s effluentwould not take into account the mass ofpollutants discharged to the POTW fromnon-industrial sources nor the dilutionof the pollutants in the POTW effluentto lower concentrations from theaddition of large amounts of non-industrial wastewater. The volatileoverride test is the last step indetermining is a pollutant will ‘‘pass-through.’’ If a pollutant has a Henry’sLaw Constant greater than 2.4×10¥5

atm-m3/mole, or 10¥3mg/m3/mg/m3, itis determined to ‘‘pass-through’’ andwill be regulated by PSES regardless ofthe percent removal data.

For past effluent guidelines, a study of50 well-operated POTWs was used forthe pass-through analysis. Because thedata collected for evaluating POTWremovals included influent levels ofpollutants that were close to thedetection limit, the POTW data wereedited to eliminate influent levels lessthan 10 times the minimum level andthe corresponding effluent values,except in the cases where none of theinfluent concentrations exceeded 10times the minimum level. In the lattercase, where no influent data exceeded10 times the minimum level, the datawere edited to eliminate influent valuesless than 20 µg/l and the correspondingeffluent values. These editing rules wereused to allow for the possibility that lowPOTW removal simply reflected the lowinfluent levels.

EPA then averaged the remaininginfluent data and also averaged theremaining effluent data from the 50POTW database. The percent removalsachieved for each pollutant wasdetermined from these averaged influentand effluent levels. This percentremoval was then compared to thepercent removal for the BAT optiontreatment technology. Due to the largenumber of pollutants applicable for thisindustry, additional data from the RiskReduction Engineering Laboratory(RREL) database was used to augmentthe POTW database for the pollutantsfor which the 50 POTW Study did notcover. Based on this analysis, 78 of the87 pollutants regulated under

Regulatory Option 1 (the combinationsof Metals Option 3, Oils Option 2, andOrganics Option 1) and 51 of the 87pollutants regulated under RegulatoryOption 2 (the combinations of MetalsOption 3, Oils Option 3, and OrganicsOption 1) for BAT passed throughPOTWs and are proposed for regulationfor PSES. The pollutants determined notto ‘‘pass-through’’ are listed in TableV.E–1.

TABLE V.E–1.—POLLUTANTS THAT DONOT PASS-THROUGH POTWS FORTHE CENTRALIZED WASTE TREAT-MENT INDUSTRY

Subcategory Pollutant

Metals subcategory ... Barium.Oils Subcategory—

Option 2.Nickel, Zinc,

TripropyleneglycolMethyl Ether.

Organics Sub-category.

Phenol, 2-Propanone,Lead, Pyridine,Zinc.

b. Options considered. The Agencytoday is proposing to establishpretreatment standards for existingsources (PSES) based on the sametechnologies as proposed for BPT andBAT for 78 of the 87 priority and non-conventional pollutants regulated underBAT for Regulatory Option 1 (thecombinations of Metals Option 3, OilsOption 2, and Organics Option 1) and81 of the 87 priority pollutants regulatedunder BAT for Regulatory Option 2 (thecombinations of Metals Option 3, OilsOption 3, and Organics Option 1) .These standards would apply to existingfacilities in all subcategories of theCentralized Waste Treatment Industrythat discharge wastewater to publicly-owned treatment works (POTWs). Theselimitations were developed based on thesame technologies as proposed today forBPT/BAT, as applicable to each of theaffected subcategories. PSES set at thesepoints would prevent pass-through ofpollutants, help control sludgecontamination and reduce air emissions.

EPA estimated the cost and economicimpact of installing BPT/BAT PSEStechnologies at the indirect dischargingfacilities. The total estimatedannualized cost in 1993 for all thesubcategories is approximately $22.9million (if PSES is Oils Option 3) andapproximately $2.78 million (if PSES isOils Option 2). EPA concluded the costof installation of these controltechnologies, in the case of metal-bearing and organic-bearing wastestreams, is clearly economicallyachievable. EPA’s assessment showsnone of the indirect dischargingfacilities in these subcategories go from

a profitable to unprofitable status as aresult of the installation of the necessarytechnology.

EPA is asking for comment onwhether it should adopt Oils Option 3as PSES for this subcategory, given thatannual costs are approximately tentimes greater than Option 2. EPA isparticularly interested in comments onwhether Option 3 is economicallyachievable, given the EPA economicassessment showing that despite its highcost, it results only in a slight increasein the number of facilities going from aprofitable to unprofitable status. In thecase of Oils Option 2, four of 31 indirectdischargers would go from a profitableto unprofitable status and for Option 3,six would experience a change from aprofitable to unprofitable status.Additional information is provided inthe Economic Impact Analysis.

The Agency considered the age, size,processes, other engineering factors, andnon-water quality environmentalimpacts pertinent to facilities indeveloping PSES. The Agency did notidentify any basis for establishingdifferent PSES limitations based on age,size, processes, or other engineeringfactors. As previously explained forBPT, adoption of standards based on theproposed technologies for metal-bearingwastes and organic-bearing wasteswould have important non-water qualityeffects. The metals standards shouldreduce landfill disposal of metalstreatment residuals and the organicwaste streams would reducevolatilization of organic compounds.

c. Monitoring to DemonstrateCompliance with the Regulation. SeeSection V.F.

6. Pretreatment Standards for NewSources

Section 307(c) of the Act requires EPAto promulgate pretreatment standardsfor new sources (PSNS) at the same timeit promulgates new source performancestandards (NSPS). New indirectdischarging facilities, like new directdischarging facilities, have theopportunity to incorporate the bestavailable demonstrated technologies,including process changes, in-facilitycontrols, and end-of-pipe treatmenttechnologies.

As set forth in Section VIII.E.4(a) ofthis preamble, EPA determined that abroad range of pollutants discharged byCentralized Waste Treatment Industryfacilities pass-through POTWs. Thesame technologies discussed previouslyfor BAT, NSPS, and PSES are availableas the basis for PSNS.

EPA is proposing that pretreatmentstandards for new sources be set equalto NSPS for priority and non-


conventional pollutants for allsubcategories. The Agency is proposingto establish PSNS for the same priorityand non-conventional pollutants as arebeing proposed for NSPS. In addition,given the potential for dilution and theconsequent impracticality of monitoringat the point of discharge, EPA is againproposing that monitoring todemonstrate compliance with thesestandards be required immediatelyfollowing treatment of the regulatedstreams.

EPA considered the cost of theproposed PSNS technology for newfacilities. EPA concluded that such costsare not so great as to present a barrierto entry, as demonstrated by the factthat currently operating facilities areusing these technologies. Again, EPA isrequesting comment on whether itshould adopt PSNS for the Oily WasteSubcategory that reflects effluentreduction levels achievable througheither Option 3 or Option 4 treatmentsystems. The Agency considered energyrequirements and other non-waterquality environmental impacts andfound no basis for any differentstandards than the selected PSNS.

F. Monitoring To DemonstrateCompliance With the Regulation

The effluent limitations EPA isproposing today apply only todischarges resulting from treatment ofthe subcategory wastes and not tomixtures of subcategory wastes withother wastes or mixtures of differentsubcategory wastes. In addition, theseeffluent limitations do not apply todischarges from the treatment ofsubcategory wastes that are mixed priorto or after treatment with otherwastewater streams prior to discharge.EPA has concluded that it is impracticaland infeasible to set limits for thepollutants proposed to be regulated inthis category at the point of dischargefor mixed waste streams, given thepotential for mixing to avoidachievement of the required effluentreductions.

Thus, many facilities in this industrymay operate other processes whichgenerate wastes requiring treatment andmay add these wastes to CWT wastesbefore treatment and discharge. Thismay result in dilution rather thanrequired treatment of CWT wastes dueto the difference in concentration ofwaste streams. In addition, if a facilitydischarges its non-contaminatedstormwater, implementation of thisproposal requires a facility to monitorthe CWT discharge prior to the additionof non-contaminated stormwater.Similarly, for facilities which treatconcentrated cyanide-bearing metal

wastes, the limitations for Total Cyanideare based on cyanide levels that aredemonstrated to be achieved aftercyanide pretreatment and prior tometals precipitation. Separatepretreatment of cyanide in metal-bearing waste streams is necessary inorder to ensure that cyanide will notinterfere with metals treatment.Consequently, EPA has preliminarilydetermined that it will requirecompliance monitoring immediatelyfollowing treatment of subcategorywaste streams (e.g., metal-bearing, oily,or organic-bearing, as appropriate)unless the facility can demonstrate thatit is achieving the required effluentreduction associated with separatetreatment of the waste streams in amixed waste treatment system. (Seefurther discussion of this issue below atSection VIII.)

G. Determination of Long-TermAverages, Variability Factors, andLimitations for BPT

The proposed effluent limitations andstandards in today’s notice are basedupon statistical procedures that estimatelong-term averages and variabilityfactors. The following sections describethe statistical methodology used todevelop long-term averages, variabilityfactors, and limitations for BPT. Thelimitations for BCT, BAT, NSPS, PSES,and PSNS are based upon thelimitations for BPT for all pollutants.

The proposed limitations forpollutants for each option, as presentedin today’s notice, are provided as dailymaximums and maximums for monthlyaverages. In most cases, the dailymaximum limitation for a pollutant inan option is the product of the pollutantlong-term average and the group dailyvariability factor. In most cases, themaximum for monthly averagelimitation for a pollutant for an optionis the product of the pollutant long-termaverage and the group monthlyvariability factor. The procedures usedto estimate the pollutant long-termaverages and group variability factorsare briefly described below. A moredetailed explanation is provided in thestatistical support document.

The long-term averages, variabilityfactors, and limitations were based uponpollutant concentrations collected fromtwo sources: EPA sampling episodesand the 1991 Detailed MonitoringQuestionnaire. These data sources aredescribed in Sections IV.B. and IV.D.(Data from the same facility but fromdifferent sources were analyzed asthough each source providedinformation about a different facility.)

The long-term average for eachpollutant was calculated for each

facility by arithmetically averaging thepollutant concentrations. The pollutantlong-term average for an option was themedian of the long-term averages fromselected facilities with the BPTtechnology basis for the option.

The daily variability factor for eachpollutant at each facility is the ratio ofthe estimated 99th percentile of thedistribution of the daily pollutantconcentration values divided by theexpected value, or mean, of thedistribution of the daily values. Themonthly variability factor for eachpollutant at each facility is theestimated 95th percentile of thedistribution of monthly averages of thedaily concentration values divided bythe expected value of the monthlyaverages. The number of measurementsused to calculate the monthly averagescorresponds to the number of days thatthe pollutant is assumed to bemonitored during the month. Forexample, the volatile organiccompounds are expected to bemonitored once a week (which isapproximately four times a month);therefore, the monthly variability factorwas based upon the distribution of four-day averages. Certain pollutants such asBOD5 are expected to be monitoreddaily; therefore, the monthly variabilityfactor was based upon the distributionof 20-day averages (most facilitiesoperate only on weekdays of whichthere are approximately 20 in eachmonth). The assumed monitoringfrequency of each pollutant is identifiedin Table V.G–1.

TABLE V.G–1.—MONITORING FRE-QUENCIES USED TO ESTIMATEMONTHLY VARIABILITY FACTORS

Assumed Daily Monitoring Frequency

Aluminum Manganese.Antimony Mercury.Arsenic Molybdenum.Barium Nickel.BOD5 Oil and Grease.Cadmium Silver.Chromium Tin.Cobalt Titanium.Copper TOC.Iron Total Cyanide.Lead TSS.Magnesium Zinc.

Assumed Weekly Monitoring Frequency

Hexavalent Chro-mium

Methylene Chloride.

1,1,1,2-Tetrachloroethane

m-Xylene.

1,1,1-Trichloroethane n-Decane.1,1,2-Trichloroethane n-Docosane.1,1-Dichloroethane n-Dodecane.


TABLE V.G–1.—MONITORING FRE-QUENCIES USED TO ESTIMATEMONTHLY VARIABILITY FACTORS—Continued

1,2,3-Trichloropropane

n-Eicosane.

1,2-Dibromoethane n-Hexacosane.1,2-Dichloroethane n-Hexadecane.trans-1,2-

dichloroethenen-Octadecane.

2,3-Dichloroaniline n-Tetradecane.2-Propanone o&p-Xylene.4-chloro-3-methyl

phenolo-Cresol.

4-Methyl-2-Pentanone Phenol.Acetophenone Pyridine.Benzene p-Cresol.Benzoic Acid Tetrachloroethene.Butanone Tetrachloromethane.Carbon Disulfide Toluene.Chloroform Trichloroethene.Diethyl ether Tripropyleneglycol

methyl ether.Hexanoic AcidEthylbenzene Vinyl Chloride.

The variability factors for each optionwere developed for groups of pollutantsin three steps. These steps are describedhere for the daily variability factors.Similar steps were used to developmonthly variability factors. The firststep was to develop a daily variabilityfactor for each pollutant at each facilityby fitting a modified delta-lognormaldistribution to the daily pollutantconcentration values from each facility.(For monthly variability factors, themodified delta-lognormal distributionwas fit to the monthly averages.) Thesecond step was to develop one dailyvariability factor for each pollutant foreach option by averaging the dailyvariability factors for the selectedfacilities with the technology basis forthe option. The third step was todevelop ‘‘group’’ daily variability factorsfor each option. Each group containedpollutants that were chemically similar.The daily variability factor for eachgroup was the median of the daily

variability factors obtained in thesecond step for the pollutants in thegroup and option. In some cases, noneof the daily variability factors for thepollutants within a group could beestimated. In some of these cases, thedaily variability factor for the group wastransferred from the other groups in theoption that used the same fraction in thechemical analysis. This transferredgroup daily variability factor was themedian of the daily variability factorsfrom the other groups. In the remainingcases where the group daily variabilityfactors could not be estimated, thegroup daily variability factors weretransferred from chemically similarpollutants or from other options withinthe subcategory. The development ofdaily and monthly variability factors isdescribed further in the statisticalsupport document.

Because EPA is assuming that somepollutants (BOD5, TSS, oil and grease,metals, total cyanide, and TOC) will bemonitored daily, the 20-day variabilityfactors were based on the distribution of20-day averages. If concentrationsmeasured on consecutive days arepositively correlated, thenautocorrelation would have an effect onthe 20-day variability factors (long-termaverages are not affected byautocorrelation). However, thecentralized waste treatment data used tocalculate the 20-day variability factorswere, in most cases, not consecutivedaily measurements. Therefore, at thistime, EPA does not have sufficient datato examine in detail and incorporate (ifstatistically significant) anyautocorrelation between concentrationsmeasured on adjacent days.Furthermore, EPA believes thatautocorrelation may not be present indaily measurements from wastewaterfrom this industry. Unlike otherindustries, where the industrialprocesses are expected to produce thesame type of wastewater from one day

to the next, the wastewater fromCentralized Waste Treatment Industry isgenerated from treating wastes fromdifferent sources and industrialprocesses. The wastes treated on a givenday will often be different than thewaste treated on the following day.Because of this, autocorrelation wouldnot be expected to be present inmeasurements of wastewater from theCentralized Waste Treatment Industry.In Section VIII.B.7, EPA requestsadditional wastewater monitoring data.EPA will use these data to furtherevaluate autocorrelation in the data forthe pollutants that will be monitoreddaily.

H. Regulatory Implementation

1. ApplicabilityThe regulation proposed today is just

that—a proposed regulation. Whiletoday’s proposal represents EPA’s bestjudgment at this time, the effluentlimitations and standards may stillchange based on additional informationor data submitted by commenters ordeveloped by the Agency.Consequently, the permit writer shouldconsider the proposed limits indeveloping permit limits. Although theinformation provided in theDevelopment Document may provideuseful information and guidance topermit writers in determining bestprofessional judgment permit limits, thepermit writer will still need to justifyany permit limits based on theconditions at the individual facility.

2. Upset and Bypass ProvisionsA ‘‘bypass’’ is an intentional diversion

of waste streams from any portion of atreatment facility. An ‘‘upset’’ is anexceptional incident in which there isunintentional and temporarynoncompliance with technology-basedpermit effluent limitations because offactors beyond the reasonable control ofthe permittee. EPA’s regulationsconcerning bypasses and upsets are setforth at 40 CFR 122.41(m) and (n).


3. Variances and ModificationsThe CWA requires application of the

effluent limitations established pursuantto Section 301 or the pretreatmentstandards of Section 307 to all directand indirect dischargers. However, thestatute provides for the modification ofthese national requirements in a limitednumber of circumstances. Moreover, theAgency has established administrativemechanisms to provide an opportunityfor relief from the application ofnational effluent limitations guidelinesand pretreatment standards forcategories of existing sources forpriority, conventional and non-conventional pollutants.

a. Fundamentally Different FactorsVariances. EPA will develop effluentlimitations or standards different fromthe otherwise applicable requirements ifan individual existing dischargingfacility is fundamentally different withrespect to factors considered inestablishing the limitation or standardsapplicable to the individual facility.Such a modification is known as a‘‘fundamentally different factors’’ (FDF)variance.

Early on, EPA, by regulation,provided for FDF modifications fromBPT effluent limitations, BATlimitations for priority and non-conventional pollutants and BCTlimitation for conventional pollutantsfor direct dischargers. For indirectdischargers, EPA provided for FDFmodifications from pretreatmentstandards for existing facilities. FDFvariances for priority pollutants werechallenged judicially and ultimatelysustained by the Supreme Court.Chemical Manufacturers Ass’n v. NRDC,479 U.S. 116 (1985).

Subsequently, in the Water QualityAct of 1987, Congress added newSection 301(n) of the Act explicitly toauthorize modification of the otherwiseapplicable BAT effluent limitations orcategorical pretreatment standards forexisting sources if a facility isfundamentally different with respect tothe factors specified in Section 304(other than costs) from those consideredby EPA in establishing the effluentlimitations or pretreatment standard.Section 301(n) also defined theconditions under EPA may establishalternative requirements. Under Section301(n), an application for approval ofFDF variance must be based solely on 1)information submitted during therulemaking raising the factors that arefundamentally different or 2)information the applicant did not havean opportunity to submit. The alternatelimitation or standard must be no lessstringent than justified by the difference

and not result in markedly more adversenon-water quality environmentalimpacts than the national limitation orstandard.

EPA regulations at 40 CFR Part 125Subpart D, authorizing the RegionalAdministrators to establish alternativelimitations and standards, further detailthe substantive criteria used to evaluateFDF variance requests for existing directdischargers. Thus, 40 CFR 125.31(d)identifies six factors (e.g., volume ofprocess wastewater, age and size of adischarger’s facility) that may beconsidered in determining if a facility isfundamentally different. The Agencymust determine whether, on the basis ofone or more of these factors, the facilityin question is fundamentally differentfrom the facilities and factorsconsidered by the EPA in developingthe nationally applicable effluentguidelines. The regulation also lists fourother factors (e.g., infeasibility ofinstallation within the time allowed ora discharger’s ability to pay) that maynot provide a basis for an FDF variance.In addition, under 40 CFR 125.31(b)(3),a request for limitations less stringentthan the national limitation may beapproved only if compliance with thenational limitations would result ineither (a) a removal cost wholly out ofproportion to the removal costconsidered during development of thenational limitations, or (b) a non-waterquality environmental impact(including energy requirements)fundamentally more adverse than theimpact considered during developmentof the national limits. EPA regulationsprovide for an FDF variance for existingindirect discharger at 40 CFR 403.13.The conditions for approval of a requestto modify applicable pretreatmentstandards and factors considered are thesame as those for direct dischargers.

The legislative history of Section301(n) underscores the necessity for theFDF variance applicant to establisheligibility for the variance. EPA’sregulations at 40 CFR 125.32(b)(1) areexplicit in imposing this burden uponthe applicant. The applicant must showthat the factors relating to the dischargecontrolled by the applicant’s permitwhich are claimed to be fundamentallydifferent are, in fact, fundamentallydifferent from those factors consideredby the EPA in establishing theapplicable guidelines. The pretreatmentregulation incorporate a similarrequirement at 40 CFR 403.13(h)(9).

An FDF variance is not available to anew source subject to NSPS or PSES.

b. Economic Variances. Section 301(c)of the CWA authorizes a variance fromthe otherwise applicable BAT effluentguidelines for non-conventional

pollutants due to economic factors. Therequest for a variance from effluentlimitations developed from BATguidelines must normally be filed by thedischarger during the public noticeperiod for the draft permit. Other filingtime periods may apply, as specified in40 CFR 122.21(l)(2). Specific guidancefor this type of variance is availablefrom EPA’s Office of WastewaterManagement.

c. Water Quality Variances. Section301(g) of the CWA authorizes a variancefrom BAT effluent guidelines for certainnonconventional pollutants due tolocalized environmental factors. Thesepollutants include ammonia, chlorine,color, iron, and total phenols.

d. Permit modifications. Even afterEPA (or an authorized State) has issueda final permit to a direct discharger, thepermit may still be modified undercertain conditions. (When a permitmodification is under consideration,however, all other permit conditionsremain in effect.) A permit modificationmay be triggered in severalcircumstances. These could include aregulatory inspection or informationsubmitted by the permittee that revealsthe need for modification. Anyinterested person may requestmodification of a permit modification bemade. There are two classifications ofmodifications: major and minor. From aprocedural standpoint, they differprimarily with respect to the publicnotice requirements. Majormodifications require public noticewhile minor modifications do not.Virtually any modifications that resultsin less stringent conditions is treated asa major modification, with provisionsfor public notice and comment.Conditions that would necessitate amajor modification of a permit aredescribed in 40 CFR 122.62. Minormodifications are generally non-substantive changes. The conditions forminor modification are described in 40CFR 122.63.

e. Removal credits. As describedpreviously, many industrial facilitiesdischarge large quantities of pollutantsto POTWs where their wastewater mixwith wastewater from other sources,domestic sewage from privateresidences and run-off from varioussources prior to treatment and dischargeby the POTW. Industrial dischargesfrequently contain pollutants that aregenerally not removed as effectively bytreatment at the POTWs as by theindustries themselves.

The introduction of pollutants to aPOTW from industrial discharges maypose several problems. These includepotential interference with the POTW’soperation or pass-through of pollutants


3 Under Section 403.7, a POTW is authorized togive removal credits only under certain conditions.These include applying for, and obtaining, approvalfrom the Regional Administrator (or Director of aState NPDES program with an approvedpretreatment program), a showing of consistentpollutant removal and an approved pretreatmentprogram. See 40 CFR 403.7(a)(3)(I), (ii) and (iii).

if inadequately treated. As discussed,Congress, in Section 307(b) of the Act,directed EPA to establish pretreatmentstandards to prevent these potentialproblems. Congress also recognized that,in certain instances, POTWs couldprovide some or all of the treatment ofan industrial user’s wastewater thatwould be required pursuant to thepretreatment standard. Consequently,Congress established a discretionaryprogram for POTWs to grant ‘‘removalcredits’’ to their indirect dischargers.The credit, in the form of a less stringentpretreatment standard, allows anincreased concentration of a pollutant inthe flow from the indirect discharger’sfacility to the POTW.

Section 307(b) of the CWA establishesa three-part test for obtaining removalcredit authority for a given pollutant.Removal credits may be authorized onlyif (1) the POTW ‘‘removes all or any partof such toxic pollutant,’’ (2) the POTW’sultimate discharge would ‘‘not violatethat effluent limitation, or standardwhich would be applicable to that toxicpollutant if it were discharged’’ directlyrather than through a POTW and (3) thePOTW’s discharge would ‘‘not preventsludge use and disposal by such[POTW] in accordance with Section[405]. . . .’’ Section 307(b).

EPA has promulgated removal creditregulations in 40 CFR 403.7. The UnitedStates Court of Appeals for the ThirdCircuit has interpreted the statute torequire EPA to promulgatecomprehensive sewage sludgeregulations before any removal creditscould be authorized. NRDC v. EPA, 790F.2d 289, 292 (3rd Cir. 1986) cert.denied. 479 U.S. 1084 (1987). Congressmade this explicit in the Water QualityAct of 1987 which provided that EPAcould not authorize any removal creditsuntil it issued the sewage sludge useand disposal regulations required bySection 405(d)(2)(a)(ii).

Section 405 of the CWA requires EPAto promulgate regulations that establishstandards for sewage sludge when usedor disposed for various purposes. Thesestandards must include sewage sludgemanagement standards as well asnumerical limits for pollutants that maybe present in sewage sludge inconcentrations which may adverselyaffect public health and theenvironment. Section 405 requires EPAto develop these standards in twophases. On November 25, 1992, EPApromulgated the Round One sewagesludge regulations establishingstandards, including numericalpollutant limits, for the use or disposalof sewage sludge. 58 FR 9248. EPAestablished pollutant limits for tenmetals when sewage sludge is applied to

land, for three metals when it isdisposed of on a surface disposal siteand for seven metals and a totalhydrocarbon operational standard, asurrogate for organic pollutantemissions, when sewage sludge isincinerated. These requirements arecodified at 40 CFR Part 503.

The Phase One regulations partiallyfulfilled the Agency’s commitmentunder the terms of a consent decree thatsettled a citizens suit to compelissuance of the sludge regulations.Gearhart, et al. v. Reilly, Civil No. 89–6266–JO (D. Ore). Under the terms ofthat decree, EPA must propose and takefinal action on the Round Two sewagesludge regulations by December 15,2001.

At the same time EPA promulgatedthe Round One regulations, EPA alsoamended its pretreatment regulations toprovide that removal credits would beavailable for certain pollutants regulatedin the sewage sludge regulations. See 58FR 9386. The amendments to Part 403provide that removal credits may bemade potentially available for thefollowing pollutants:

(1) If a POTW applies its sewagesludge to the land for beneficial uses,disposes of it on surface disposal sitesor incinerates it, removal credits may beavailable, depending on which use ordisposal method is selected (so long asthe POTW complies with therequirements in Part 503). When sewagesludge is applied to land, removalcredits may be available for ten metals.When sewage sludge is disposed of ona surface disposal site, removal creditsmay be available for three metals. Whenthe sewage sludge is incinerated,removal credits may be available forseven metals and for 57 organicpollutants. See 40 CFR403.7(a)(3)(iv)(A).

(2) In addition, when sewage sludge isused on land or disposed of on a surfacedisposal site or incinerated, removalcredits may also be available foradditional pollutants so long as theconcentration of the pollutant in sludgedoes not exceed a concentration levelestablished in Part 403. When sewagesludge is applied to land, removalcredits may be available for twoadditional metals and 14 organicpollutants. When the sewage sludge isdisposed of on a surface disposal site,removal credits may be available forseven additional metals and 13 organicpollutants. When the sewage sludge isincinerated, removal credits may beavailable for three other metals. See 40CFR 403.7(a)(3)(iv)(B).

(3) When a POTW disposes of itssewage sludge in a municipal solidwaste landfill that meets the criteria of

40 CFR Part 258 (MSWLF), removalcredits may be available for anypollutant in the POTW’s sewage sludge.See 40 CFR 403.7(a)(3)(iv)(C). Thus,given compliance with the requirementsof EPA’s removal credit regulations,3following promulgation of thepretreatment standards being proposedhere, removal credits may be authorizedfor any pollutant subject to pretreatmentstandards if the applying POTWdisposes of its sewage sludge in aMSWLF that meets the requirements of40 CFR Part 258. If the POTW uses ordisposes of its sewage sludge by landapplication, surface disposal orincineration, removal credits may beavailable for the following metalpollutants (depending on the method ofuse or disposal): arsenic, cadmium,chromium, copper, iron, lead, mercury,molybdenum, nickel, selenium andzinc. Given compliance with Section403.7, removal credits may be availablefor the following organic pollutants(depending on the method of use ordisposal) if the POTW uses or disposesof its sewage sludge: benzene, 1,1-dichloroethane, 1,2-dibromoethane,ethylbenzene, methylene chloride,toluene, tetrachloroethene, 1,1,1-trichloroethane, 1,1,2-trichloroethaneand trans-1,2-dichloroethene.

Some facilities may be interested inobtaining removal credit authorizationfor other pollutants being considered forregulation in this rulemaking for whichremoval credit authorization would nototherwise be available under Part 403.Under Sections 307(b) and 405 of theCWA, EPA may authorize removalcredits only when EPA determines that,if removal credits are authorized, thatthe increased discharges of a pollutantto POTWs resulting from removalcredits will not affect POTW sewagesludge use or disposal adversely. Asdiscussed in the preamble toamendment to the Part 403 regulations(58 FR 9382–83), EPA has interpretedthese sections to authorize removalcredits for a pollutant only in one of twocircumstances. Removal credits may beauthorized for any categorical pollutant(1) for which EPA has established anumerical pollutant limit in Part 503; or(2) which EPA has determined will notthreaten human health and theenvironment when used or disposed ofin sewage sludge. The pollutantsdescribed in paragraphs (1)–(3) above


4 In the Round One sewage sludge regulation,EPA concluded, on the basis of risk assessments,that certain pollutants (see Appendix G to Part 403)did not pose an unreasonable risk to human healthand the environment and did not require theestablishment of sewage sludge pollutant limits. Asdiscussed above, so long as the concentration ofthese pollutants in sewage sludge are lower than aprescribed level, removal credits are authorized forsuch pollutants.

include all those pollutants that EPAeither specifically regulated in Part 503or evaluated for regulation anddetermined would not adversely affectsludge use and disposal.

Consequently, in the case of apollutant for which EPA did notperform a risk assessment in developingthe Phase One sewage sludgeregulations, removal credit forpollutants will only be available whenthe Agency determines either a safelevel for the pollutant in sewage sludgeor that regulation of the pollutant isunnecessary to protect public healthand the environment from thereasonably anticipated adverse effects ofsuch a pollutant.4 Therefore, any personseeking to add additional categoricalpollutants to the list for which removalcredits are now available would need tosubmit information to the Agency tosupport such a determination. The basisfor such a determination may includeinformation showing the absence ofrisks for the pollutant (generallyestablished through an environmentalpathway risk assessment such as EPAused for Phase One) or data establishingthe pollutant’s presence in sewagesludge at low levels relative to risklevels or both. Parties, however, maysubmit whatever information theyconclude is sufficient to establish eitherthe absence of any potential for harmfrom the presence of the pollutant insewage sludge or data demonstrating a‘‘safe’’ level for the pollutant in sludge.Following submission of such ademonstration, EPA will review the dataand determine whether or not it shouldpropose to amend the list of pollutantsfor which removal credits would beavailable.

EPA has already begun the process ofevaluating a number of pollutants foradverse potential to human health andthe environment when present insewage sludge. In May, 1993, pursuantto the terms of the consent decree in theGearhart case, the Agency notified theUnited States District Court for theDistrict of Oregon that, based on theinformation then available at that time,it intended to propose 31 pollutants forregulation in the Round Two sewagesludge regulations. These are acetic acid(2,4-dichlorophenoxy), aluminum,antimony, asbestos, barium, beryllium,boron, butanone, carbon disulfide,

cresol (p-), cyanides (soluble salts andcomplexes), dioxins/dibenzofurans (allmonochloro to octochloro congeners),endsulfan-II, fluoride, manganese,methylene chloride, nitrate, nitrite,pentachloro-nitrobenzene, phenol,phthalate (bis-2-ethylhexyl),polychlorinated biphenyls (co-planar),propanone (2-), silver, thallium, tin,titanium, toluene,trichlorophenoxyacetic acid (2, 4, 5-),trichlorphenoxypropionic acid ([2—(2,4, 5-)], and vanadium.

The Round Two regulations are notscheduled for proposal until December,1999 and promulgation in December2001. However, given the necessaryfactual showing, as detailed above, EPAcould conclude before the contemplatedproposal and promulgation dates thatregulation of some of these pollutants isnot necessary. In those circumstances,EPA could propose that removal creditsshould be authorized for such pollutantsbefore promulgation of the Round Twosewage sludge regulations. However,given the Agency’s commitment topromulgation of effluent limitations andguidelines under court-superviseddeadlines, it may not be possible tocomplete review of removal creditauthorization requests by the time EPAmust promulgate these guidelines andstandards.

4. Relationship of Effluent Limitationsto NPDES Permits and MonitoringRequirements

Effluent limitations act as a primarymechanism to control the discharges ofpollutants to waters of the UnitedStates. These limitations are applied toindividual facilities through NPDESpermits issued by the EPA or authorizedStates under Section 402 of the Act.

The Agency has developed thelimitations and standards for thisproposed rule to cover the discharge ofpollutants for this industrial category. Inspecific cases, the NPDES permittingauthority may elect to establishtechnology-based permit limits forpollutants not covered by this proposedregulation. In addition, if State waterquality standards or other provisions ofState or Federal Law require limits onpollutants not covered by this regulation(or require more stringent limits oncovered pollutants), the permittingauthority must apply those limitations.

For determination of effluent limitswhere there are multiple categories andsubcategories, the effluent guidelinesare applied using a flow-weightedcombination of the appropriateguideline for each category orsubcategory. Where a facility treats aCWT waste stream and processwastewater from other industrial

operations, the effluent guidelineswould be applied by using a flow-weighted combination of the BPT/BAT/PSES limit for the CWT subcategory andthe other industrial operations to derivethe appropriate limitations. However, asstated above, if State water qualitystandards or other provisions of State orFederal Law require limits on pollutantsnot covered by this regulation (orrequire more stringent limits on coveredpollutants), the permitting authoritymust apply those limitations regardlessof the limitation derived using the flow-weighted combinations.

Working in conjunction with theeffluent limitations are the monitoringconditions set out in a NPDES permit.An integral part of the monitoringconditions is the point at a facility mustmonitor to demonstrate compliance.The point at which a sample is collectedcan have a dramatic effect on themonitoring results for that facility.Therefore, it may be necessary to requireinternal monitoring points in order toassure compliance. Authority to addressinternal waste streams is provided in 40CFR 122.44(I)(1)(iii) and 122.45(h).Today’s proposed integrated ruleestablishes several internal monitoringpoints to ensure compliance with theeffluent guideline limitations. Permitwriters may establish additional internalmonitoring points to the extentconsistent with EPA’s regulations.

5. Implementation for Facilities withOperations in Multiple Subcategories

According to the 1991 WasteTreatment Industry Questionnaire,thirty percent of facilities in theCentralized Waste Treatment Industryhave been identified as accepting wastethat is included in two or more of thesubcategories being proposed forregulation here. In other words, thefacilities actively accept a variety ofwaste types. This is not to be confusedwith the fact that metal-bearing wastestreams may include low level organicsor that oily wastes may include metalsdue to the origin of the waste streamaccepted for treatment.

The limitations and standards EPA istoday proposing are based on treatmentof wastes that have not beencommingled for treatment without theappropriate pretreatment. EPA’ssampling program and other data in therecord demonstrate that mixing ofwastes before treatment does notprovide appropriate pollutant removalsbut may merely mask the absence ofremoval through dilution.Consequently, the proposal requiredmonitoring immediately following thetreatment of the regulated waste streamto demonstrate compliance. Wastes


treated in the Centralized WasteTreatment Industry have beencharacterized as concentrated, difficultto treat wastewater, sludges, off-specproducts, etc. and are often unlike wastestreams found at other categoricalindustries. Therefore, special attentionshould be taken when facilitiesdetermine which waste streams areaccepted for treatment.

If a facility accepts for treatment amixture of waste types, it is still subjectto limitations and standards (andmonitoring to demonstrate compliance)that reflect the treatment performanceachievable for the unmixed streams. Inother words, if a facility accepts fortreatment metal-bearing and oily waste,the facility must comply with thelimitations and standards based on atreatment system which employsemulsion-breaking, ultrafiltration, andcarbon adsorption to ‘‘adequately treat’’the oily waste for the oils and organicsconstituents. Similarly, discharges fromthe metal-bearing stream must complywith the limitations and standardsdefined by a treatment systememploying selective metalsprecipitation. Compliance with thelimitations and standards must bedemonstrated following treatment. EPAhas concluded that if oily wastes thathave not been pretreated are mixed withthe metal-bearing waste stream forselective metals precipitation, the unitwill not meet the required performancelevel for metals.

The effluent guideline would beapplied by using a flow-weightedcombination of BPT/BAT/PSESlimitations for the subcategories ofconcern to derive the facility limit. Thepermit writer may establish limitationsand standards based on separatetreatment for each subcategory’soperation.

Mixing of dissimilar waste streamsmay result in dilution of pollutantsbecause the waste streams do notcontain the same pollutants or mayresult in dilution of the stream to thepoint that pollutants are non-detectible.For waste streams which contain thesame pollutants at similarconcentration, pretreatment may not benecessary.

The Agency attempted to establishone set of limitations for facilities in allsubcategories, but due to the fact thatperformances levels and the pollutantsof concern are not the same for allsubcategories, this task could not bedone. The Agency solicits comment onits approach to multiple subcategoryfacilities. EPA is requesting commentersto supply additional data which theymay have that would aid incharacterizing the efficiency of wastetreatment systems for facilities whichcommingle waste from multiplesubcategories prior to treatment.

EPA considered and rejected anotherapproach which did not requiremonitoring to demonstrate compliancewith CWT limitations and standards inthe case of facilities which mixedcategorical waste streams with CWTwastes. Rather, for such facilities,permit writers would require the facilityto identify the sources of the CWTwastestreams and then develop facilitylimits applying the combined wastestream formula, using the applicableguidelines and limitations for the CWTwaste source. If CWT wastes weretreated separately at such a facility, thenthe permit writer would just apply theCWT limitations and standards indeveloping the limits. EPA is asking forcomment on whether to reconsider suchan approach.

VI. Costs and Impacts of RegulatoryAlternatives

A. CostsThe Agency estimated the cost for

CWT facilities to achieve each of theeffluent limitations and standardsproposed today. These estimated costsare summarized in this section anddiscussed in more detail in theTechnical Development Document. Allcost estimates in this section areexpressed in terms of 1993 dollars. Thecost components reported in this sectionrepresent estimates of the investmentcost of purchasing and installingequipment, the annual operating andmaintenance costs associated with thatequipment, additional costs fordischarge monitoring, and costs forfacilities to modify existing RCRApermits. In Sections VI.B., costs areexpressed in terms of a different cost

component, total annualized cost. Thetotal annualized cost, which is used toestimate economic impacts, betterdescribes the actual compliance costthat a company will incur, allowing forinterest, depreciation, and taxes. Asummary of the economic impactanalysis for the proposed regulation iscontained in Section VI.B. of today’snotice. See also the economic impactanalysis.

1. BPT Costs

The Agency estimated the cost ofimplementing the proposed BPTeffluent limitations guidelines andstandards by calculating the engineeringcosts of meeting the required effluentreductions for each direct dischargingCWT. This facility-specific engineeringcost assessment for BPT began with areview of present waste treatmenttechnologies. For facilities withouttreatment technology in-placeequivalent to the BPT technology, EPAestimated the cost to upgrade itstreatment technology, to use additionaltreatment chemicals to achieve the newdischarge standards, and to employadditional personnel, where applicablefor the option. The only facilities givenno cost for compliance were facilitieswith the treatment-in-place prescribedfor that option. The Agency believesthat this approach overestimates thecosts to achieve the proposed BPTbecause many facilities can achieve BPTlevel discharges without using all of thecomponents of the technology basisdescribed in Section V.E. The Agencysolicits comment on these costingassumptions. Table VI.A–1 summarizes,by subcategory, the capital expendituresand annual O&M costs for implementingBPT. Costs are presented for RegulatoryOption 1 (the combination of MetalsOption 3, Oils Option 2, and OrganicsOption 1) and Regulatory Option 2 (thecombination of Metals Option 3, OilsOption 3, and Organics Option 1). Thecapital expenditures for the processchange component of BPT are estimatedto be $17.7 million with annual O&Mcosts of $14.3 million for RegulatoryOption 1 and $20.6 million with annualO&M costs of $21.7 million forRegulatory Option 2.


TABLE VI.A–1.—COST OF IMPLEMENTING BPT REGULATIONS

[In millions of 1993 dollars]

Subcategory No. offacilities 1

Capitalcosts

AnnualO&M costs

Metals Treatment and Recovery ................................................................................................................... 12 15.4 10.5Oils Treatment and Recovery—Regulatory Option 1 ................................................................................... 4 1.02 0.779Oils Treatment and Recovery—Regulatory Option 2 ................................................................................... 4 3.84 8.15Organics Treatment ....................................................................................................................................... 6 1.32 3.06

Regulatory Option 1 ...................................................................................................................................... 16 17.7 14.3Regulatory Option 2 ...................................................................................................................................... 16 20.6 21.7

1 There are 16 direct dischargers. Because some direct dischargers include operations in more than one subcategory, the sum of the facilitieswith operations in any one subcategory exceeds the total number of facilities.

2. BCT/BAT CostsThe Agency estimated that there

would be no cost of compliance forimplementing BCT/BAT, because thetechnology is identical to BPT and thecosts are included with BPT.

3. PSES CostsThe Agency estimated the cost for

implementing PSES with the same

assumptions and methodology used toestimate cost of implementing BAT.Table VI.A–2 summarizes, bysubcategory, the capital expendituresand annual O&M costs for implementingPSES. Costs are presented for RegulatoryOption 1 (the combination of MetalsOption 3, Oils Option 2, and OrganicsOption 1) and Regulatory Option 2 (thecombination of Metals Option 3, Oils

Option 3, and Organics Option 1). Thecapital expenditures for the processchange component of PSES areestimated to be $43.8 million withannual O&M costs of $26.8 million forRegulatory Option 1 and $52.6 millionwith annual O&M costs of $45.9 millionfor Regulatory Option 2.

TABLE VI.A–2.—COST OF IMPLEMENTING PSES REGULATIONS

[In millions of 1993 dollars]

Subcategory No. offacilities1

Capitalcosts

AnnualO&M costs

Metals Treatment and Recovery ................................................................................................................. 44 28.5 23.0Oils Treatment and Recovery—Regulatory Option 1 ................................................................................. 31 4.21 2.37Oils Treatment and Recovery—Regulatory Option 2 ................................................................................. 31 13.0 21.5Organics Treatment ..................................................................................................................................... 16 11.1 1.41

Regulatory Option 1 .................................................................................................................................... 56 43.8 26.8Regulatory Option 2 .................................................................................................................................... 56 52.6 45.9

1 There are 16 direct dischargers. Because some direct dischargers include operations in more than one subcategory, the sum of the facilitieswith operations in any one subcategory exceeds the total number of facilities.

B. Pollutant Reductions

The Agency estimated the reductionin the mass of pollutants that would bedischarged from CWT facilities after theimplementation of the regulations beingproposed today.

1. Conventional Pollutant Reductions

EPA has calculated how muchadoption of the proposed BPT/BCTlimitations would reduce the totalquantity of conventional pollutants thatare discharged. To do this, for eachsubcategory, the Agency developed anestimate of the long- term averageloading (LTA) of BOD5, TSS, and Oiland Grease that would be dischargedafter the implementation of BPT. Next,these BPT/BCT LTAs for BOD5, TSS,and Oil and Grease were multiplied by1989 wastewater flows for each directdischarging facility in the subcategory tocalculate BPT/BCT mass dischargeloadings for BOD5, TSS, and Oil andGrease for each facility. The BPT/BCT

mass discharge loadings were subtractedfrom the estimated current loadings tocalculate the pollutant reductions foreach facility. Each subcategory’s BPT/BCT pollutant reduction was summed toestimate the total facility’s pollutantreduction for those facilities treatingwastes in multiple subcategories.Subcategory reductions, obviously, wereobtained by summing individualsubcategory results. The Agencyestimates that the proposed regulationswill reduce BOD5 discharges byapproximately 34.5 million pounds peryear for Regulatory Option 1 (thecombination of Metals Option 3, OilsOption 2, and Organics Option 1) and36.9 million pounds per year forRegulatory Option 2 (the combination ofMetals Option 3, Oils Option 3, andOrganics Option 1); TSS discharges byapproximately 30.3 million pounds peryear for both Regulatory Options; andOil and Grease discharges byapproximately 52.4 million pounds per

year for Regulatory Option 1 (thecombination of Metals Option 3, OilsOption 2, and Organics Option 1) and56.9 million pounds per year forRegulatory Option 2 (the combination ofMetals Option 3, Oils Option 3, andOrganics Option 1).

2. Priority and NonconventionalPollutant Reductions

a. Methodology. Today’s proposal, ifpromulgated, will also reducedischarges of priority and non-conventional pollutants. Applying thesame methodology used to estimateconventional pollutant reductionsattributable to application of BPT/BCTcontrol technology, EPA has alsoestimated priority and non-conventionalpollutant reductions for each facility bysubcategory. Because EPA has proposedBAT limitations equivalent to BPT,there are obviously no further pollutantreductions associated with BATlimitations.


Current loadings were estimated byusing data collected by the Agency inthe field sampling program and from thequestionnaire data supplied by theindustry. For many facilities, data werenot available for all pollutants ofconcern or without the addition of othernon-CWT wastewater. Therefore,methodologies were developed toestimate current performance for eachsubcategory assessing performance ofon-site treatment technologies, by usingwastewater permit information andmonitoring data supplied in the 1991Waste Treatment IndustryQuestionnaire and the DetailedMonitoring Questionnaire as describedin Section V.B.

b. Direct Facility Discharges (BPT/BAT) The estimated reductions inpollutants directly discharged in treatedfinal effluent resulting fromimplementation of BPT/BAT are listedin Table VI.B–1. Pollutant reductionsare presented for Regulatory Option 1(the combination of Metals Option 3,Oils Option 2, and Organics Option 1)and Regulatory Option 2 (thecombination of Metals Option 3, OilsOption 3, and Organics Option 1). TheAgency estimates that proposed BPT/BAT regulations will reduce directfacility discharges of priority, and non-conventional pollutants by 5.0 millionpounds per year for Regulatory Option1 and 8.0 million pounds per year forRegulatory Option 2.

TABLE VI.B–1.—REDUCTION IN DIRECTDISCHARGE OF PRIORITY ANDNONCONVENTIONAL POLLUTANTSAFTER IMPLEMENTATION OF BPT/BAT REGULATIONS

[Units=lbs/year]

Subcategory Metal com-pounds

Organiccom-

pounds

Metals Treatmentand Recovery .... 871,832 245,525

Oils Treatment andRecovery—Reg-ulatory Option 1 294,543 556,627

Oils Treatment andRecovery—Reg-ulatory Option 2 319,847 610,937

Organics Treat-ment .................. 3,065,679 10

Regulatory Option1 ........................ 4,232,054 802,153

Regulatory Option2 ........................ 7,617,580 1,413,091

1 The organic compounds pollutant reductionfor the Organics Subcategory was estimatedto be 0, because all facilities had the treat-ment-in-place for removal of organic com-pounds.

c. PSES Effluent Discharges toPOTWs. The estimated reductions inpollutants indirectly discharged toPOTWs resulting from implementationof PSES are listed in Table VI.B–2.Pollutant reductions are presented forRegulatory Option 1 (the combination ofMetals Option 3, Oils Option 2, andOrganics Option 1) and RegulatoryOption 2 (the combination of MetalsOption 3, Oils Option 3, and OrganicsOption 1). The Agency estimates thatproposed PSES regulations will reduceindirect facility discharge to POTWs by6.5 million pounds per year forRegulatory Option 1 and 12 millionpounds per year for Regulatory Option2.

TABLE VI.B–2.—REDUCTION IN INDI-RECT DISCHARGE OF PRIORITY ANDNONCONVENTIONAL POLLUTANTSAFTER IMPLEMENTATION OF PSESREGULATIONS

[Units=lbs/year]

Subcategory Metal com-pounds

Organiccom-

pounds

Metals Treatmentand Recovery .... 428,040 120,545

Oils Treatment andRecovery—Reg-ulatory Option 1 709,834 1,341,439

Oils Treatment andRecovery—Reg-ulatory Option 2 771,668 1,474,708

Organics Treat-ment .................. 415,812 3,521,560



C. Economic Impact Assessment

1. Introduction

EPA’s economic impact assessment isset forth in a report titled ‘‘EconomicImpact Analysis of Proposed EffluentLimitations Guidelines and Standardsfor the Centralized Waste TreatmentIndustry’’ (hereinafter ‘‘EIA’’). Thisreport estimates the economic andfinancial effects of compliance with theproposed regulation in terms of facilityand company profitability and assessesthe economic effect of compliance onsix regional markets. Communityimpacts and the effects on localcommunities and new centralized wastetreatment (CWT) facilities are alsopresented. The EIA also includes aRegulatory Flexibility Analysis detailingthe effects on small businesses for thisindustry.

As discussed previously, a total of 85Centralized Waste Treatment facilities

owned and operated by 57 companiesare potentially subject to the proposedregulation. EPA has projected that 72 ofthese facilities will incur costs as aresult of this regulation. The economicimpact on each of the 72 direct andindirect dischargers was calculatedbased on the cost of compliance withthe required effluent discharge levels forthe appropriate subcategory. Impacts ondirect dischargers were calculated forcompliance with the proposed BPT/BCT/BAT; impacts on indirectdischargers were calculated forcompliance with PSES.

Because two options are beingproposed for the Oils Subcategory, EPAcalculated the cost of compliance witheach option. Regulatory Option 1 (thecombination of Metals Option 3, OilsOption 2, and Organics Option 1) isestimated to have a total annualized costof $49.1 million, and Regulatory Option2 (the combination of Metals Option 3,Oils Option 3, and Organics Option 1)is estimated to have a total annualizedcost of $76.8 million. In Table VI.C–1,the total annualized costs for BPT/BCT/BAT and PSES are presented in 1993dollars.

TABLE VI.C–1.— TOTAL ANNUALIZEDCOSTS (106 $1993)

OptionBPT/BCT/BAT

PSES Total

Option 1 .................. 14.2 34.9 49.1Option 2 .................. 21.8 55.0 76.8

EPA also conducted an analysis of thecost-effectiveness of the alternativetreatment technology optionsconsidered by the Agency. The resultsof this cost-effectiveness analysis areexpressed in terms of the incrementalcosts per pound of toxic-equivalentremoved. Toxic-equivalents weights areused to account for the differences intoxicity among the pollutants removed.The number of pounds of a pollutantremoved by each option is multiplied bya toxic weighting factor. The toxicweighting factor is derived usingambient water quality criteria andtoxicity values. The toxic weightingfactors are standardized by relatingthem to copper. Cost-effectiveness iscalculated as the ratio of incrementalannualized costs of an option to theincremental pounds-equivalent removedby that option. The report, ‘‘Cost-Effectiveness of Proposed EffluentLimitations Guidelines and Standardsfor the Centralized Waste TreatmentIndustry’’ (hereinafter, ‘‘Cost-Effectiveness Report’’), is included inthe record of this rulemaking.


The Agency recognizes that its database, which represents conditions in1989, may not precisely reflect currentconditions in the industry today. EPArecognizes that the questionnaire datawere obtained several years ago andthus may not precisely mirror presentconditions at every facilities.Nevertheless, EPA concluded that thedata provide a sound and reasonablebasis for assessing the overall ability ofthe industry to achieve compliance withthe regulations. The purpose of theimpact analysis is to characterize theimpact of the proposed regulation forthe industry as a whole and for majorgroupings within the industry.

2. Baseline Industry AnalysisOf the 85 Centralized Waste

Treatment facilities, 53 facilities arestrictly commercial, accepting wastegenerated by other for treatment andmanagement for a fee. Fourteen facilitiesare non-commercial, ‘‘captive’’ facilitiesthat accept waste from off-site fortreatment exclusively from facilitiesunder the same ownership. Theremaining 16 are mixed commercial/

non-commercial facilities. They managetheir own company’s wastes and acceptsome waste from other sources for a fee.For the purposes of this analysis, 15mixed commercial/non-commercialfacilities have been included with thecommercial facilities because a majorityof their operations are commercial. Theone remaining mixed commercial/non-commercial facility has been includedwith the non-commercial facilitiesbecause most of the operations are non-commercial.

The companies that own CWTfacilities range from large, multi-facilitymanufacturing companies to smallcompanies that own only a singlefacility (see Table VI.C–2). Of these 57companies, 13 are small businesses (i.e.,companies with less than $6 million inannual revenues). For the commercialfacilities, the ability of companies tocontinue to support unprofitableoperations will depend on companysize, as well as baseline financial status.

The baseline economic analysis(presented in Table VI.C–2) evaluatedeach facility’s financial operatingcondition prior to incurring compliance

costs for this regulation. In 1989, about20 percent of the commercial CWTfacilities were unprofitable. Severalothers were only marginally profitable.The industry had expanded capacityduring the 1980s, but since the late1980s, there has been a reduction indemand for these services perhaps dueto pollution prevention efforts byindustrial waste generators. EPA stafflearned in conversations with personnelat a number of these facilities that,while some of these facilities were nowprofitable, most of the remainingunprofitable facilities were still inoperation three years after thequestionnaire. The continued operationof such a large share of unprofitablefacilities in the industry raises asignificant issue. It suggests that thetraditional tools of economic analysisused to project potential closures in anindustry due to the costs of compliancemay not accurately predict real worldbehavior in a market where owners havehistorically demonstrated a willingnessto continue operating unprofitablefacilities.

TABLE VI.C–2.—BASELINE CONDITIONS IN THE CWT INDUSTRY

Discharge status

Number of CWT Facilities by Commercial and Dis-charge Status Commercial

Profit >0 Profit <0 Non-commercial Total

Direct ............................................................................................................................... 5 2 9 16Indirect ............................................................................................................................. 35 15 6 56Zero ................................................................................................................................. 8 5 0 13

Total ...................................................................................................................... 48 22 15 85

COMPANIES OWNING CWT FACILITIES

Number ofcompanies

Number offacilities

Small Companies (sales < $6 million) ............................................................................................................................ 13 13All Other Companies (sales > $6 million) ....................................................................................................................... 44 72

LIKELIHOOD OF COMPANY BANKRUPTCY a

Small com-panies

All othercompanies Total

Likely ....................................................................................................................................................... 1 5 6Indeterminate ........................................................................................................................................... 3 13 16Unlikely .................................................................................................................................................... 8 18 26

12 36 48

Several reasons may explain whyunprofitable facilities remain inoperation rather than being closed bytheir owners. First, most facilities areregulated under RCRA. Closure of aRCRA facility requires that the siteundergo RCRA clean-up procedure prior

to closure, which would entailexpensive long-term monitoring andpossibly clean-up of the site. Accordingto information received from facilities,owners may find it less costly to keepunprofitable facilities in operationrather than incurring the costs of RCRA

closure. Second, many facilities stay inbusiness hoping that newenvironmental regulation, such as theupcoming RCRA Phase 3 rule, may


create more business for facilities.Finally, some facilities perform a servicefor the rest of their company, such asgenerating a metal-rich sludge whichmay be incorporated into the parentcompanies smelting processes.

For these reasons and because of thecaptive nature of many facilities,company-level impacts are a moreappropriate indicator of economicachievability, as they measure thedecision making process of companiesand the resources available to achievecompliance. Facility-level changes inrevenues where applicable and costs arecomputed as inputs to the companylevel analysis.

3. Economic Impact MethodologyStandard economic and financial

analysis methods are used to assess theeconomic effects of the proposedregulation. These methods incorporatean integrated view of Centralized WasteTreatment facilities, the companies thatown these facilities, the markets thefacilities serve, and the communitieswhere they are located.

Faced with increased costs of theproposed regulation, owners of CWTfacilities have three choices: (1) Complywith the guidelines and incur the costs,(2) if a facility has operations in morethan one subcategory, close the mostaffected operation, or (3) close thefacility. Conventional economicreasoning argues that companies willmake their decision based on anassessment of the benefits and costs ofthe facility to the company.

For commercial CWT facilities, thecost and benefits are readilyobservable—benefits to the company arethe total revenues received; costs to thecompany include the payments made tothe factors of production (labor,materials, etc.) plus the opportunitycosts of self-owned resources (e.g., theland and capital equipment). Aspreviously discussed, the costassociated with closure of a RCRAfacility have caused facilities to remainopen even when experiencing economicand financial difficulties.

For captive facilities, there is noquantifiable measure of benefits to thecompany of having the capacity tomanage the wastes in a facility ownedby the company because there is noeasily defined relationship between thewastes and the products that generatethe wastes. Clearly, however, companiesdo weigh the benefits and costs ofoperating a CWT facility, and thebenefits in this case may include lowerexpected future liability costs, morecontrol over the costs and scheduling oftreatment, and certainty that treatmentcapacity exists for their wastes.

According to conversations withcaptive facilities, most are in businesssolely for the purpose of lower liabilitycosts associated with the self-management of hazardous wastes.

Changes in the costs of treatment inCWT facilities may be expected to resultin an increase in the price of services,which will feed back to the revenue sideof commercial facilities. Overall, as longas generators have alternatives tocommercial treatment (e.g., on sitetreatment, pollution prevention) thequantity of services traded may beexpected to fall as a result of theguidelines and standards. But for someservices, such as cyanide treatment ortreatment of concentrated metalssludges, there are no other alternativesto commercial treatment.

Changes in the economic conditionsin the CWT industry may impact theviability of the companies that ownCWTs. Specifically, some companiesthat are already marginal or that operatea single unprofitable facility may go outof business either by simply liquidatingtheir assets, or by declaring bankruptcy.

Finally, the communities where theCWT facilities are located may beimpacted. Obviously, if facilities cutback operations, employment andincome may fall sending ripple effectsthroughout the local community. On theother hand, there may be increasedemployment associated with operatingthe pollution controls associated withthe regulation resulting in increasedcommunity employment and income. Atthe same time, for the communities inwhich CWTs are located, water qualitymay be expected to improve.

4. Application of the Market Analysis

For the market analysis, EPAcharacterized each facility individuallybased on the quantity of each type ofwaste treatment service they provide,their revenues and costs, employment,market share for each type of serviceprovided, ownership, releases, andlocation in terms of the communitywhere they are located and the regionalmarket they serve. Six regional marketsare defined.

Costs of CWT facilities include boththose that vary with the quantity ofCWT services provided (variable costs)and those whose value is fixed. Per-gallon variable costs are assumedconstant to the capacity output rate.Revenues from CWT operations areestimated by multiplying the marketprice of the CWT service by the quantityof waste treated in the CWT service.Most CWT facilities also have revenuesfrom other sources, which are treated asexogenous.

The demand for CWT services ischaracterized based on theresponsiveness of quantity demanded toprice. CWT services are intermediategoods demanded because they areinputs to production of other goods andservices. The sensitivity of quantitydemanded to price for an intermediategood depends on the demandcharacteristics (elasticity) of the good orservice it is used to produce, the shareof manufacturing costs represented byCWT costs, and the availability ofsubstitutes for CWT services. Theelasticity of demand for manufacturedproducts varies widely. CWT servicescosts as a share of manufacturing costsis generally quite small. Substitutes forCWT services include other types of off-site waste management such asunderground injection, on-sitetreatment, or pollution prevention.Overall, the change in quantitydemanded for CWT services is assumedto be approximately proportional to anyprice change (e.g., a one percentincrease in the price of a CWT serviceis expected to reduce the quantitydemanded for the service by about onepercent).

The markets for CWT services areregional. This market characterization isbased on responses to the questionnaireand is consistent with the theory ofeconomic geography. Within eachmarket, there are a relatively smallnumber of suppliers and a relativelylarge number of demanders. Thus themarket structure is treated as beingimperfectly competitive. This impliesthat the competition each facility facesis limited to facilities in its region sothat all suppliers have a degree ofmarket power.

This characterization of facilities,companies and markets is incorporatedin a model that takes the engineeringestimates of the costs of compliancewith the effluent limitations guidelinesand standards and projects impacts onfacilities, companies, markets andcommunities. Each CWT faced withhigher costs of providing CWT servicesmay find it economical to reduce thequantity of waste it treats. This decisionis simultaneously modeled for allfacilities within a regional market, todevelop consistent estimates of thefacility and market impacts. Changes inthe quantity of CWT services offeredresult in changes in the inputs used toproduce these services (mostimportantly, labor).

For commercial facilities, the EIAthus projects changes in employment atCWT facilities. Changes in facilityrevenues and costs result in changes inthe revenues and costs of the companiesowning the facilities, and thus changes


in company profits. Increased borrowingand changes in the assets owned by thecompanies, together with changes inprofits, result in changes in overallcompany financial health. The EIAprojects changes in the likelihood ofcompany bankruptcy as a result of theeffluent limitations guidelines andstandards. These effects are separatelycalculated for small businesses. Changesin employment are specified by locationto determine the community impacts.

For non-commercial facilities,financial viability was determined on acompany level. This is because the non-commercial facilities are generally costcenters for their companies. They do notexplicitly receive revenues for theirservices. They exist to perform a servicefor the rest of the company and are notexpected to be ‘‘profitable’’ as a unit.These facilities are included in themarket analysis because prices charged

for their commercial operations maychange. Companies with somecommercial operations will raise pricesto cover the variable costs of thetreatment and help pay for some of theirfixed costs (e.g. underwrite the companywaste treatment costs). Thus, no changein the quantity of CWT wastes treatedare projected for non-commercial aspectof these facilities nor are market effectsanalyzed for the products of the parentcompany, since the share of wastetreatment costs in the marketedproducts are minimal.

5. Results of the Economic ImpactAnalysis

Results may be reported at the facility,company, market, or community level.All facilities are either direct or indirectdischargers. Most companies own eitherfacilities that are direct dischargers orindirect dischargers, although twocompanies own both direct and indirect

discharging facilities. Market levelimpacts are the combined result of bothtypes of dischargers simultaneouslycomplying with the regulation. Becausemarkets for CWT services combinefacilities that are direct dischargers andfacilities that are indirect dischargers, itis not possible to break the market-levelimpacts into impacts of BPT/BCT/BATas distinguished from impacts of PSES.Community-level impacts are alsoreported based on the combined impactsof BPT/BCT/BAT and PSES. Company-level impacts are reported separately forBPT/BCT/BAT and PSES.

The impacts of complying with BATcontrols under Regulatory Options 1and 2 for the 57 companies operatingCWT facilities are shown in Table VI.C–3 (for companies owning facilities thatdischarge directly) and Table VI.C–4 (forcompanies owning facilities thatdischarge indirectly).

TABLE VI.C—3.—IMPACTS OF THE BPT/BCT/BAT REGULATORY OPTIONS a

Company impacts of compliance with BPT/BCT/BATregulatory options

Likelihood of bankruptcy

Option 1 Option 2

Small com-panies Others Total Small com-

panies Others Total

Likely ............................................................................... 0 1 1 0 1 1Indeterminate ................................................................... 0 2 2 0 2 2Unlikely ............................................................................ 0 11 11 0 11 11

a Two companies own both direct and indirect dischargers. Company-level impacts combine the effects of complying with BPT/BCT/BAT andPSES controls. These two companies appear in both tables.

TABLE VI.C–4.—IMPACTS OF THE PSES REGULATORY OPTIONS a

Company impacts of compliance with the PSES regu-latory options

Likelihood of bankruptcy

Option 1 Option 2

Small com-panies Others Total Small com-

panies Others Total

Likely ............................................................................... 4 5 9 2 6 8Indeterminate ................................................................... 2 10 12 0 10 10Unlikely ............................................................................ 5 13 18 9 12 27

a Two companies own both direct and indirect dischargers. Company-level impacts combine the effects of complying with BPT/BCT/BAT andPSES controls. These two companies appear in both tables.

6. Market Impacts of EPA RegulatoryOptions

The markets for CWT services areregional. Within each region, marketsfor overall types of treatment such asmetal recovery or metal treatment maybe further subdivided into smallermarkets on the basis of the per-galloncost of treatment. The price changes andquantity changes projected at theregional and service level with eachoption are combined into an overallnational value for the CWT services. Inall cases, EPA’s assessment projects thatthe prices of these services will increase

and utilization of service will fall. Thus,EPA would expect, if the limitationsand standards are promulgated asproposed, a reduction in the absolutequantity of wastes commercially treatedin addition, of course, to theimprovement in treatment. Thesemarket-level adjustments in the quantityof wastes that are treated are reflected inthe reduction in the quantity of servicesprovided by individual commercialCWTs. In some cases, with less wastebeing managed by these facilities, it ispossible that some commercial facilitiescould close. If demanders of waste

management services are assumed tohave fewer substitutes for CWT servicesthan assumed here, then prices wouldincrease more than projected here,quantities would fall less and thefacility and company level impacts(discussed below) would be smaller.

Under Option 1, price increases rangefrom 3 to 35 percent, while quantities ofwaste treated decrease by between 3percent and 20 percent. Under Option 2,price increases range from 3 to 42percent, while quantity decreases rangefrom 3 percent to 65 percent. The largerprice increases occur in the Oils


Recovery and Oils Treatment Markets.These higher price increases occurbecause of the poor treatment operationscurrently in place (only one facility inthe Oils Recovery treats the wastewatergenerated from the oil recovery process).Price increases may occur in this marketbecause the present market hasinadequate treatment for the wastesgenerated.

Significant price increases havepotential effects on the users of CWTservices. In order to account for impactson the users of CWT services, EPAestimated the consumer surplus share ofdead weight loss of the proposedregulation to be $6.8 million 1993dollars for Regulatory Option 1 (thecombination of Metals Option 3, OilsOption 2, and Organics Option 1) and$13.4 million 1993 dollars forRegulatory Option 2 (the combination ofMetals Option 3, Oils Option 3, andOrganics Option 1). These costs are notadditive to the direct implementationcosts of the proposed regulation due todifferences in the technique forcalculating the consumer surplus costs.But the costs indicate the burden is notexcessive in the context of the rule.

7. Impacts of BPT/BCT/BATComplying with the BPT/BCT/BAT

effluent limitations guidelines andstandards will increase the cost oftreating CWT wastes at affected directdischargers. This in turn will reduce thenumber of facilities providing CWTservices, resulting in an increase in themarket price of the treatment servicesand a decrease in use of CWT services.EPA projects that changes in the pricesof CWT services, combined withfacility-specific changes in the costs oftreatment and the quantities of wastetreated, will result in changes in facilitycosts and revenues from services sold.These changes result in changes in therevenues and costs of companiesowning CWT facilities. In addition,changes in the liabilities and assets ofcompanies owning CWT facilities resultfrom the borrowing and purchasing ofcapital equipment associated withcomplying with the regulation. Thus,overall company viability may changeas a result of complying with theeffluent limitations guidelines andstandards. The Agency conducted ananalysis using a multi-discriminantfunction called the Z-score, whichcombines several financial ratios, toestimate changes in the likelihood ofcompany bankruptcy that result fromcompliance with the guidelines andstandards. As shown in Table VI.C–3,one company owning a direct dischargeris predicted to be likely to becomebankrupt under both Regulatory Options

1 and 2. However, this company wasalso predicted to be bankrupt at baseline(see Table VI.C–2), so the RegulatoryOptions for BPT/BCT/BAT do not havean incremental adverse effect on theviability of companies owning directdischargers.

8. Impacts of PSESComplying with the PSES standards

will increase the cost of treating CWTwastes at affected indirect dischargers.This in turn will reduce the supply ofCWT services, resulting in an increasein the market price and a decrease inuse of CWT services. Changes in theprices of CWT services, combined withfacility-specific changes in the costs oftreatment and the quantities of wastetreated, result in changes in facilitycosts and revenues from services sold.These changes result in changes in therevenues and costs of companiesowning CWT facilities. In addition,changes in the liabilities and assets ofcompanies owning CWT facilities resultfrom the borrowing and purchases ofcapital equipment associated withcomplying with the regulation. Thus,overall company viability may changeas a result of complying with theeffluent limitations guidelines andstandards. As with BPT/BCT/BAT, theAgency used the Z-score to estimatechanges in the likelihood of companybankruptcy that result from compliancewith the guidelines and standards. Asshown in Table VI.C–4, EPA projectsthat nine companies owning indirectdischargers will likely become bankruptunder Regulatory Option 1, and eightcompanies owning indirect dischargersare likely to become bankrupt underRegulatory Option 2. At baseline, EPAanalysis shows that five companiesowning indirect dischargers arebankrupt. Thus, the PSES controls arepredicted to result in only anincremental impact on companyviability.

With the PSES controls underRegulatory Option 1, four additionalcompanies owning indirect dischargersare predicted to become bankrupt.Under Regulatory Option 2, threeadditional companies owning indirectdischargers are predicted to becomebankrupt. Although the costs are higherin general under Regulatory Option 2,the data show that the companiesowning indirect dischargers that incurthese higher costs are better able towithstand the impacts.

To the extent that predictedbankruptcies result in closure of CWTfacilities, the cost of such closure areattributable to this action. EPA has notcalculated the cost of closure for thetreatment operations although for

RCRA-permitted facilities, under somecircumstances, such costs may besignificant. The EPA solicits commenton the probability for closure of suchfacilities impacted by the proposedregulation and the costs associated withclosure of the treatment operations.

9. Community Impacts of the RegulatoryOptions

Overall, the communities in whichCWT facilities are located are expectedto experience fairly small, and generallypositive, increases in employment as aresult of the Regulatory Options. Inaddition to the negative employmentchanges estimated for facilitiesbecoming unprofitable under Options 1and 2, employment increases may occurin some facilities due to the operationalchanges related to the new regulationsor due to the increase in volume ofwaste treated. These changes inemployment may be positive for CWTfacilities made better off by theregulation (for example, those who sellmore services), or they may be negativefor facilities becoming less profitablebut not moving from profitable tounprofitable. Nationwide, facilitiesbecoming unprofitable reduce theiremployment by 44 employees underRegulatory Option 1 and by 52employees under Regulatory Option 2.Combined with market-related increasesand decreases in employment at otherfacilities, the total market-relatedreduction in employment underRegulatory Option 1 is estimated to be378 employees. Under RegulatoryOption 2, the national market-relatedreduction employees is estimated to be501 employees.

These decreases in employment resultfrom market adjustments to theproposed regulations must be comparedto the employment increases estimatedto be required for operation andmaintenance of the controls. A largepercentage of the costs estimated forfacilities is attributed to the high annualoperating and maintenance costs. TheAgency estimates that the properhandling and treatment of theconcentrated wastes will requireadditional personnel and tanks tosegregate and monitor the wastes beingtreated. Therefore, under RegulatoryOption 1, the labor requirements of thecontrols are estimated to be 710employees. Under Regulatory Option 2,the labor requirements are estimated tobe 735 employees. Overall, employmentis projected to increase by 333employees under Regulatory Option 1and by 234 employees under RegulatoryOption 2. Thus, we expect community-level impacts to be small and generallypositive.


5 Further, EPA’s toxic weighting factors do notprovide environmental ‘‘credit’’ for removal ofcertain regulated pollutants. Thus, for example, the

toxic weighting factors do not account for removalsof the conventional pollutant, oil and grease.Consequently, a comparison of the difference incost-effectiveness associated with oil subcategory

Regulatory Options 1 and 2 does not account for thesignificantly greater removals of oil and greaseachieved through Regulatory Option 2 treatmenttechnology.

10. Foreign Trade Impacts

The EIA does not project any foreigntrade impacts as a result of the effluentlimitations guidelines and standards.Although most of the affected CWTfacilities treat waste that is consideredhazardous under RCRA, internationaltrade in CWT services for treatment ofhazardous wastes is virtuallynonexistent.

11. Regulatory Flexibility Analysis

The Agency performed an initialregulatory flexibility analysis to assessthe relative severity of impacts on smallentities, specifically small companies,owning CWT facilities. Smallcompanies are defined as those havingsales less than $6 million, which is theSmall Business Administrationdefinition of a small business for SICcode 4953, Refuse Systems. This is theSIC code that most CWTs listed in theirquestionnaire responses. Thirteen of the84 facilities not owned by the FederalGovernment are small companiesaccording to this definition. One facilityis owned by the Federal Government.To determine whether the impacts onsmall companies are ‘‘significant,’’ EPAused the following criteria:

(1) Annual compliance costs increasetotal costs of production for smallentities for the relevant process orproduct by more than 5 percent.

(2) Compliance costs as a percentageof sales for small entities are at least 10percent higher than compliance costs asa percentage of sales for large entities.

(3) The requirements of the regulationare likely to result in closures of smallentities.

Six of the thirteen small companiesare estimated to have compliance costs

exceeding 5 percent of baseline CWTcosts. Larger companies, however, haveboth a higher absolute number and ahigher percentage of companiesincurring compliance costs that exceed5 percent of baseline CWT costs. Thus,small businesses are affected less thanother facilities.

The median value for the ratio ofcompliance costs to sales for smallcompanies is very small: 0.6 percent.However, the median value for largercompanies is even smaller: less than0.001 percent. Thus, the ratio for smallcompanies is more than 10 percenthigher than the ratio for largercompanies. While this suggests thatsmall companies are more affected incomparison to the larger companies, theoverall level of impact is very low forall size categories.

The analysis does not estimate facilityclosures, but it does assess the impactof the Regulatory Options on thelikelihood of company bankruptcy. Asshown in Tables VI.C–3 and VI.C–4,three of four additional companiespredicted to become ‘‘likely’’ to incurbankruptcy under Regulatory Option 1are small. Of the three additionalcompanies becoming likely to incurbankruptcy as a result of Option 2, oneis small. Thus, under Regulatory Option1, small businesses incur relativelylarger impacts according to thismeasure, but under Regulatory Option2, small businesses do not incurrelatively larger impacts.

Overall, while companies in all sizecategories are affected, small companiesmay experience impacts that aresomewhat greater relative to thoseincurred by larger companies.

The Agency considered less stringentcontrol options for each subcategory.

However, given the concentrated anddifficult-to-treat wastes handled at CWTfacilities, the Agency does not believe aless stringent level of control is BPT/BCT/BAT. From discussions withpermit writers for CWT facilities, underthe present treatment standards, manyinstances of water contamination andodor releases occur because ofCentralized Waste Treatment facilitiesas well as contamination of sludge atPOTWs. In comparison to otherpromulgated effluent guidelines, thisindustry has some of the mostconcentrated and toxic waste streams.Therefore, a stringent level of control isdeemed necessary.

12. Cost-Effectiveness Analysis

For each of the Regulatory Options,cost-effectiveness is calculated as theratio of the incremental annual costs in1981 dollars to the incremental pounds-equivalent of pollutants removed. Theestimated pounds-equivalent removedwere calculated by weighting thenumber of pounds of each pollutant bythe relative toxic weighting factor foreach pollutant. The use of pounds-equivalent gives correspondingly moreweight to more highly toxic pollutants.Thus, for a given expenditure andpounds of pollutants removed, the costper pound-equivalent removed wouldbe lower when more highly toxicpollutants are removed than when lesstoxic pollutants are removed. Theanalysis employed toxic weightingfactors for weighting different pollutantsaccording to their relative toxicity.5Table VI.C–5 and Table VI.C–6 show theTotal Cost-Effectiveness for eachsubcategory option for BPT/BAT andPSES, respectively.

TABLE VI.C–5.—BPT/BAT COST EFFECTIVENESS ANALYSIS

Option Total costs($1981)

Total removals(lb. eq.)

Cost-effective-ness

($/lb. eq.)

Incrementalcost-effective-

ness($/lb. eq.)

Metals Subcategory

1 ....................................................................................................................... 2,278,827 1,085,922 5.542 ....................................................................................................................... 8,541,863 1,142,279 51.52 111.133 ....................................................................................................................... 8,840,764 1,148,324 61.79 49.45

Oils Subcategory

1 ....................................................................................................................... 0 0 0 ........................2 ....................................................................................................................... 628,228 113,500 5.54 5.543a ..................................................................................................................... 6,143,622 119,256 51.52 958.19


TABLE VI.C–5.—BPT/BAT COST EFFECTIVENESS ANALYSIS—CONTINUED


Total removals(lb. eq.)

Cost-effective-ness

($/lb. eq.)

Incrementalcost-effective-

ness($/lb. eq.)

4 ....................................................................................................................... 7,262,456 117,540 61.79 ¥652.04

Organics Subcategory

1 ....................................................................................................................... 293,131 843,908 0.352 ....................................................................................................................... 2,280,094 25,585 89.12 ¥2.43

a Due to the use of pounds equivalent for the Cost-Effectiveness Analysis, the pollutant removals do not include the incremental Oil & Greaseremoval of 1,308,503 lb/year for Oils Option 3. The incremental cost associated with the removal of Oil and Grease ($0.39/pound removed) iscommensurate with other effluent limitations guidelines and standards, such as the $9.77/pound of TSS and Oils and Grease promulgated for theOffshore Subcategory of the Oil and Gas Extraction Point Source Category (EPA 821–R–93–003).

TABLE VI.C–6.—PSES COST EFFECTIVENESS ANALYSIS


Total removals(lb.eq.)

Cost effective-ness ($/lb.eq.)

Incrementalcost effective-ness ($/lb.eq.)

Metals Subcategory

1 ....................................................................................................................... 2,410,819 156,945 15.36 ........................2 ....................................................................................................................... 17,790,208 164,492 108.15 2,037.923 ....................................................................................................................... 18,676,537 165,056 113.15 1,569.66

Oils Subcategory

1 ....................................................................................................................... 0 0 ........................ ........................2 ....................................................................................................................... 2,021,483 146,606 13.79 13.793 b ..................................................................................................................... 16,570,113 148,780 111.37 6,692.494 ....................................................................................................................... 19,864,864 148,264 133.98 ¥6,376.47

Organics Subcategory

1 ....................................................................................................................... 1,837,897 47,409 38.77 ........................2 ....................................................................................................................... 3,722,098 41,227 90.28 ¥304.83

D. Water Quality Analyses

The water quality benefits ofcontrolling discharges from CWTs tosurface waters and POTWs wereevaluated in national analyses of directand indirect dischargers. CWT effluentscontain priority, nonconventional, andconventional pollutants. Discharge ofthese pollutants into freshwater andestuarine ecosystems may alter aquatichabitats, affect aquatic life, andadversely impact human health. Manyof these pollutants are either humancarcinogens, human systemic toxicants,or aquatic life toxicants. In addition,many of these pollutants are persistentand bioaccumulate in aquaticorganisms. These pollutants can alsoaffect POTW operations and causePOTW sludge contamination. Fourdirect CWT wastewater dischargers andeight POTWs receiving wastewater from13 indirect CWT dischargers arecurrently impairing receiving streamwater quality (i.e., are listed on EPA’s

304(l) short list of impaired waterbodies). In addition, seven cases ofimpairment of POTW operations havealso been documented. (All 66pollutants proposed for regulation haveat least one toxic effect (human healthcarcinogen and/or systemic toxicant oraquatic toxicant)).

Discharge of conventional pollutantssuch as TSS, Oil & Grease, and BOD 5

can have adverse effects on humanhealth and environment. For example,habitat degradation can result fromincreased suspended particulate matterthat reduces light penetration and, thus,primary productivity, or fromaccumulation of sludge particles thatalters benthic spawning grounds andfeeding habitats. Oil & Grease can havelethal effect on fish, by coating surfaceof gills causing asphyxia, or depletingoxygen levels due to excessivebiological oxygen demand, or byreducing stream reaeration because ofsurface film. Oil and grease can alsohave detrimental effects on waterfowl

by destroying the buoyancy andinsulation of their feathers.Bioaccumulation of oil substances cancause human health problems includingtainting of fish and bioaccumulation ofcarcinogenic polycyclic aromaticcompounds. High BOD 5 levels can alsodeplete of oxygen levels resulting inmortality or other adverse effects onfish. But the effects of conventionalpollutants and pollutant parameters,such as TOC and COD, are notcalculated when modelling the effect ofthe proposed regulation on the waterquality of receiving streams and POTWoperations. The Agency solicitscomment on possible approaches forcalculating the effect of conventionalpollutants and pollutant parameters,such as TOC and COD, on the waterquality of receiving streams and POTWoperations in terms of inhibition orsludge contamination.


The effects of direct wastewaterdischargers of toxic pollutants(excluding conventional pollutants andpollutant parameters) on receivingstream water quality are evaluated atcurrent and proposed BPT/BATtreatment levels for today’s proposedrule. The potential impacts of indirectwastewater dischargers on POTWs interms of inhibition of POTW operation,contamination of sludge and the effectsof POTWs effluents on receiving streamwater quality are also evaluated atcurrent discharge levels and proposedPSES levels. Water quality models areused to project pollutant in-streamconcentrations based on estimatedreleases at current and proposedtreatment levels; the in-streamconcentrations are then compared toEPA-published water quality criteria orto documented toxic effect levels whereEPA water quality criteria are notavailable for certain pollutants. POTWmodels are used to estimate potentialPOTW inhibition and sludgecontamination.

The effects on receiving stream waterquality for 15 direct and 45 indirectCWT facilities discharging up to 113pollutants to 15 receiving streams and33 POTWs respectively, are evaluated.These analyses are first performed onsubcategory-specific basis for the threeCWT subcategories (i.e., metals, oils,and organics subcategories). Thesubcategory-specific analyses, however,consider only impacts of dischargesfrom individual subcategories, andtherefore, underestimate overall waterquality impacts for facilities withmultiple subcategory operations. Over40% of facilities in the CentralizedWaste Treatment Industry haveoperations in multiple subcategories. Inorder to evaluate overall benefits of theproposed BPT/BAT/PSES proposedoptions for pollutants (excludingconventional pollutants and pollutantparameters), the water quality andPOTW analyses are also performed formultiple subcategory combinations, asappropriate for individual facilities.

The subcategory-specific modelingresults for pollutants (excludingconventional and pollutant parameters)show that the proposed BPT/BAT/PSESlimitations reduce current excursions ofchronic aquatic life and/or humanhealth criteria or toxic effect levels asfollows: (1) for the Metals Subcategoryfrom 19 receiving streams to fourstreams; (2) for the Oils Subcategoryfrom seven receiving streams to onestream for both co-proposed options;and (3) for the Organics Subcategoryfrom 14 receiving streams to fivestreams. For the multiple subcategorycombinations (as applicable to

individual facilities), the modelingshows current excursions of chronicaquatic life and/or human health criteriaor toxic effect levels projected for 30receiving streams reduced to tenreceiving streams for both co-proposedregulatory options.

The potential impacts of 45 indirectdischargers, which discharge up to 113pollutants (excluding conventionalpollutant and pollutant parameters) into33 POTWs are also evaluated in termsof inhibition of POTW operations andcontamination of sludge. Both, thesubcategory-specific analyses for thesethree CWT subcategories (i.e., metals,oils, and organics subcategories), and forthe multiple subcategory combinations,as appropriate for individual facilities,are performed. The subcategory-specificmodeling results show the proposedPSES reduce and/or eliminate currentpotential POTW inhibition and sludgecontamination problems as follows: (1)in the Metals Subcategory from 9POTWs with potential inhibitionproblems to two POTWs, and from 11POTWs with potential sludgecontamination problems to one POTW;and (2) in the Oils Subcategory from tenPOTWs with potential inhibitionproblems to three POTWs and from onePOTW with potential sludgecontamination problem to none for bothco-proposed options. No potentialPOTW inhibition or sludgecontamination problems are projectedfor the Organics Subcategory at anylevel. For the multiple subcategorycombinations, the modeling shows theproposed PSES to reduce current POTWinhibition problems projected for 17POTWs to six POTWs, and potentialcurrent sludge contamination problemsprojected for 13 POTWs to one POTW.

The POTW inhibition and sludgevalues used in this analysis are not, ingeneral, regulatory values. They arebased upon engineering and healthestimates contained in guidance orguidelines published by EPA and othersources. Thus, EPA generally is notbasing its regulatory approach forproposed pretreatment discharge levelsupon the finding that some pollutantsinterfere with POTWs by impairing theirtreatment effectiveness or causing themto violate applicable limits for theirchosen disposal methods. (Rather, theproposed discharge limits are basedupon a determination of pass through asexplained earlier in preamble).However, the values used in thisanalysis help indicate the potentialbenefits for POTW operations andsludge disposal that may result from thecompliance with proposed pretreatmentdischarge levels.

E. Non-Water Quality EnvironmentalImpacts

The elimination or reduction of oneform of pollution may create oraggravate other environmentalproblems. Therefore, Sections 304(b)and 306 of the Act call for EPA toconsider non- water qualityenvironmental impacts of effluentlimitations guidelines and standards.Accordingly, EPA has considered theeffect of these regulations on airpollution, solid waste generation, andenergy consumption.

1. Air Pollution

CWT facilities generate wastewaterthat contain significant concentrationsof organic compounds, some of whichare also on the list of Hazardous AirPollutants (HAP) in title 3 of the CleanAir Act Amendments (CAAA) of 1990.These wastewater typically pass-through a series of collection andtreatment units that are open to theatmosphere and allow wastewatercontaining organic compounds tocontact ambient air. Atmosphericexposure of the organic-containingwastewater may result in significantvolatilization of both volatile organiccompounds (VOC), which contribute tothe formation of ambient ozone, andHAP from the wastewater.

VOC and HAP are emitted fromwastewater beginning at the point wherethe wastewater first contacts ambientair. Thus, VOC and HAP fromwastewater may be of concernimmediately as the wastewater isdischarged from the process unit.Emissions occur from wastewatercollection units such as process drains,manholes, trenches, sumps, junctionboxes, and from wastewater treatmentunits such as screens, settling basins,and equalization basins, biologicalaeration basins, air or steam stripperslacking air emission control devices,and any other units where thewastewater is in contact with the air.

Today’s proposed regulations for theOrganics Subcategory are based on theuse of air stripping equipped with acarbon adsorption air emission controldevice for controlling volatile organiccompounds. For the Metals and OilsSubcategories, where low levels ofvolatile organic compounds weredetected, treatment technologies areequipped air scrubbers to controlemissions.

No adverse air impacts are expectedto occur due to the proposedregulations. Based on raw wastewaterloading estimates, air emissions ofvolatile pollutants would decrease by2.0 million pounds per year due to the


use of air stripping equipped withcarbon adsorption air emission controldevices. The proposed regulation,however, does not require air strippingequipped with carbon adsorption airemission control devices or any specifictechnology, but only establishes theamount of pollutant that can bedischarged to navigable waters.

2. Solid WasteSolid waste would be generated due

to the following technologies, ifimplemented to meet proposedregulations, selective metalsprecipitation, ultrafiltration, reverseosmosis, carbon adsorption, and airstripping. The solid wastes generateddue to the implementation of thetechnologies discussed above werecosted for off-site disposal. These costswere included in the economicevaluation of the proposed technologies.

The filter cake from selective metalsprecipitation will generally containmetal-bearing waste. Even though thefilter cake generated from selectivemetals precipitation may be recycleddue to its high metal content, the EPAdeveloped costs for disposal of the filtercake in Subtitle C and D landfills. EPAwould expect that some portion of themetal-rich filter cake will be recycled.EPA estimates that 39 million pounds offilter cake will be generated annually by56 facilities.

Reverse osmosis of oily streamsresults in the generation of aconcentrated residual stream. Theconcentrate contains oily and metal-bearing wastes. The EPA estimates that58 million gallons of reverse osmosisconcentrate will be generated annuallyby 35 facilities.

Ultrafiltration of oily streams resultsin the generation of a concentratedresidual stream which contain oily andorganic waste. The EPA estimates that4.1 million gallons of ultrafiltrationconcentrate will be generated annuallyby 35 facilities.

Granular activated carbon adsorptiontreatment of waste results in thegeneration of exhausted or spentactivated carbon. Approximately 1.6million pounds of activated carbon willbe exhausted or spent annually by 35facilities. The activated carbon may beregenerated on-site or off-site byvendors. The EPA costed regeneration ofthe spent activated carbon by off-sitevendors.

Air stripping of waste streams resultsin the generation of contaminated off-gas, which requires the application of anair pollutant control device such as acatalytic oxidizer. When the catalyticoxidizer becomes deactivated, the spentcatalyst must be replaced.

Approximately 168.5 pounds annuallyof spent catalytic oxidizer are used.

3. Energy Requirements

EPA estimates that the attainment ofBPT, BCT, BAT, NSPS, PSES, and PSNSwill increase energy consumption by asmall increment over present industryuse. The main energy requirement intoday’s proposed rule is for theoperation of ultrafiltration units.Ultrafiltration units operate at highpressures to separate the waste stream.The ultrafiltration unit would require9.4 million kilowatthours per year.Energy requirements will also increasedue to reverse osmosis and liquidfiltration units. Reverse osmosis andliquid filtrations units would requireapproximately 4.1 and 4.9 millionkilowatthours per year, respectively.Overall, an increase of 22.0 millionkilowatthours per year would berequired for the proposed regulationwhich equates to 40 barrels of oil perday. The United States currentlyconsumes 19 million barrels of oil perday.

VII. Administrative Requirements

A. Docket and Public Record

The public record for this rulemakingis available for public review at EPAHeadquarters, 401 M Street SW.,Washington, DC 20460 in the Office ofWater Docket, Room L102 (in thebasement of Waterside Mall). TheDocket is staffed by an EPA contractor,Labat-Anderson, Inc., and interestedparties are encouraged to call for anappointment. The telephone number forthe Water Docket is (202) 260–3027. TheEPA information regulation (40 CFRPart 2) provides that a reasonable feemay be charged for photocopying.

EPA notes that many documents inthe record supporting these proposedrules have been claimed as confidentialbusiness information and, therefore, arenot included in the record that isavailable to the public in the WaterDocket. To support the rulemaking, EPAis presenting certain information inaggregated form or is masking facilityidentities to preserve confidentialityclaims. Further, the Agency haswithheld from disclosure some data notclaimed as confidential businessinformation because release of thisinformation could indirectly revealinformation claimed to be confidential.

B. Clean Water Act ProceduralRequirements

As required by the Clean Water Act,EPA will conduct a public hearing onthe pretreatment standards portion ofthe proposed rule. The public hearing

will be conducted on March 24, 1995,from 8:30 a.m. to 10:30 a.m. in the LakeMichigan Conference Room at the U.S.EPA Region V Building, 77 WestJackson Boulevard, Chicago, IL.

C. Executive Order 12866

Under Executive Order 12866, [58 FR51735 (October 4, 1993)] the Agencymust determine whether the regulatoryaction is ‘‘significant’’ and thereforesubject to OMB 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,or 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 ExecutiveOrder 12866, it has been determinedthat this rule is a ‘‘significant regulatoryaction’’ because it may adversely affecta sector of the economy. As such thisaction was submitted to OMB forreview. Changes made in response toOMB suggestions or recommendationswill be documented in the publicrecord.

EPA has concluded that costs on theeconomy of this proposed rule will beless than $100 million annually, and ithas not prepared an RIA.

D. Executive Order 12875

In developing the proposed CWTeffluent limitations guidelines andstandards, EPA has already investedsubstantial time in discussions withpermit writers, the affected industriesand environmental groups. Aspreviously noted, in March of this year,EPA held a public meeting, attended byindustry, states, and local permittingauthorities to discuss its efforts. TheAgency also has had discussionsconcerning the regulation at the 1994Pretreatment Coordinators Workshopattended by state and local permittingauthorities, various industrial tradeassociation meetings, and effluentguideline task force meetings.


On October 26, 1993, PresidentClinton issued Executive Order No.12875, ‘‘Enhancing theIntergovernmental Partnership.’’ Thisorder is intended to reduce theimposition of unfunded mandates uponState, local and tribal governments. Theorder requires Federal agencies like EPAthat impose unfunded mandates uponsuch governments through regulationeither (1) to assure that the Federalgovernment provides the necessaryfunds for compliance or (2) to describethe extent of the Agency’s priorconsultations with affected units ofgovernments and the nature of theirconcerns. The order calls forintergovernmental consultation to beginas early as possible in the regulatorydevelopment process, preferably beforethe publication of the notice ofproposed rulemaking. Consultation maycontinue after publication but mustoccur prior to the formal promulgationof the regulatory action containing theproposed mandate.

The rulemaking process to developthe CWT limitations guidelines andstandards antedates the issuance of E.O.12875 by a number of years as explainedabove. To meet its obligations underE.O. 12875, following publication of theregulation, EPA plans extensiveoutreach efforts to state and localgovernments. EPA will developestimates of the upfront and recurringcosts likely incurred by State, local ortribal governments in complying withthe proposal, if adopted.

E. Regulatory Flexibility ActThe Regulatory Flexibility Act, 5

U.S.C. 601 et. seq., requires EPA andother agencies to prepare an initialregulatory flexibility analysis forregulations that have a significantimpact on a substantial number of smallentities. EPA projects that today’sproposed rule, if promulgated, couldaffect small businesses. The initialregulatory flexibility analysis for theseproposed rules is incorporated into theeconomic impact analysis and isdiscussed in Section VI.A. Briefly, thesmall entity analysis estimates theeconomic impacts of the newrequirements on small companies anddescribes the potential disparateimpacts between the groups of large andCentralized Waste Treatment facilities.The analysis also presents the Agency’sconsideration of alternatives that mightminimize the impacts on small entities.

The reasons why EPA is proposingthis rule are presented in Section II. Thelegal basis for today’s rule is presentedin Legal Authority. The number of smallentities and the approach for definingsmall entities are summarized inSection VI.A. and the economic effects

on small entities detailed in theeconomic impact analysis report for thisrulemaking. This assessment has led theAgency to conclude that smallbusinesses are not disproportionatelyimpacted by the proposed rule.Reporting and other compliancerequirements are summarized inSections VI. and VII. and detailed in thetechnical development document.While the Agency has not identified anyduplicative, overlapping, or conflictingFederal rules, a discussion of otherrelated rulemakings is presented inSection II.

F. Paperwork Reduction Act

The proposed effluent guidelines andstandards contain no informationcollection activities and, therefore, noinformation collection request (ICR) hasbeen submitted to the Office ofManagement and Budget (OMB) forreview and approval under theprovisions of the Paperwork ReductionAct, 44 U.S.C. 3501 et seq.

VIII. Solicitation of Data and Comments

A. Introduction and General Solicitation

EPA invites and encourages publicparticipation in this rulemaking. TheAgency asks that comments address anyperceived deficiencies in the record ofthis proposal and that suggestedrevisions or corrections be supported bydata.

The Agency invites all parties tocoordinate their data collectionactivities with EPA to facilitatemutually beneficial and cost-effectivedata submissions. EPA is interested inparticipating in study plans, datacollection and documentation. Pleaserefer to the FOR FURTHER INFORMATIONsection at the beginning of this preamblefor technical contacts at EPA.

B. Specific Data and CommentSolicitations

EPA has solicited comments and dataon many individual topics throughoutthis preamble. The Agency incorporateseach and every such solicitation here,and reiterates its interest in receivingdata and comments on the issuesaddressed by those solicitations. Inaddition, EPA particularly requestscomments and data on the followingissues:

1. Applicability of Regulation forFacilities Which Mix Centralized WasteTreatment Waste Streams With OtherIndustrial Waste Prior to Treatment orAfter Minimal Treatment

The Agency is asking for comment onwhether the guidelines and standardsshould apply to categorical facilitieswhich receive limited quantities of CWT

waste streams for treatment. The Agencyconsidered two approaches for thisproposal.

The first approach EPA consideredwould have limited the applicability ofthe guidelines and standards to facilitieswhich treat only the defined CWTwastes without any mixing of wasteswith other categorical wastes. EPA,however, has rejected this approach forthe proposal because of concern thatthis would create a loophole. If CWTwastes could be mixed with otherwastes for treatment and escaperegulation as CWT wastes, there existssignificant possibility that economicallyachievable reduction of CWT pollutantdischarge levels will not be met. TheAgency believes that if the guidelinesand standards do not apply to CWTwastes mixed with other waste streamsthere is significant potential forblending waste streams to avoidotherwise required effluent reductionlevels.

Under the approach EPA is proposing,CWT wastes that are mixed with othercategorical waste streams or other wastestreams will be subject to CWT effluentlimitations and standards. Even underthis second approach, however, thereexists significant potential to avoidachieving CWT effluent reduction levelsby mixing wastes. Therefore, in order toensure that facilities mixing CWTwastes and non-CWT waste streamsactually treat the CWT wastes, theAgency is also proposing to requireseparate monitoring for compliancewith CWT standards or limitationswaste streams (or alternatively, ademonstration that treatment of mixedCWT wastes and other waste streamsachieves the required pollutantreductions). (See discussion below.) Inthe absence of a requirement forseparate monitoring for compliance ofCWT waste streams, promulgation of theCWT guideline could have the perverseresult of, in fact, discouragingcentralized treatment by encouragingcategorical facilities to accept CWTwaste streams that are diluted withother waste streams before treatment.The result would be no treatment for theCWT wastes and no achievement ofeffluent reduction obtainable at facilitiestreating only CWT wastes. The Agencyis asking for comment on this approach.

2. Monitoring To DemonstrateCompliance With CWT Limitations andStandards

EPA is today proposing to requireeach CWT facility that dischargeswastewater resulting from the treatmentof CWT wastes to monitor todemonstrate compliance with


6 However, a facility which receives wastes bypipeline from a facility which receives off-sitewastes by truck, barge, etc. but does not treat thewastes is still a CWT facility. The interposition ofan intermediate collection agent between generatorsof CWT waste and a CWT treatment facility doesnot convert the treatment facility into a non-CWTfacility.

applicable subcategory limitations andstandards.

As discussed above, commingling ofdisparate waste streams may, in manycases, allow achievement of dischargelimits without any real reduction in thequantity of discharges of certainpollutants. In fact, EPA has data thatshow that CWT facilities whichcommingle subcategory waste do notachieve the reductions in pollutantdischarges that separate treatmentyields. One facility at which EPAsampled mixes oily wastewater afterchemical emulsion breaking with metal-bearing wastewater. EPA measured theoily wastewater after emulsion breakingand before mixing with the othersubcategory wastes and foundmeasurable levels of regulated organiccompounds. Samples of the mixedwastewater showed non-detectablelevels of the organic compounds. Thetreatment for mixed wastewaterincluded no treatment for organicsremoval. Thus, this facility clearlyprovides no reduction in organicpollutant discharges other than thatprovided by chemical emulsionbreaking of the surface oil. Separatetreatment of oily wastes would,however, remove significant quantitiesof organic pollutants. EPA haspreliminarily concluded that thereduced removals that may beassociated with the mixing of wastestreams is inconsistent with therequirements of the Act. EPA,consequently, as previously discussed,is requiring that the CWT demonstrateto the POTW or permitting authoritythat it is achieving removal of regulatedpollutants that are equivalent to thatwhich would be obtained if the wastesare treated separately.

EPA’s proposal today does not requireseparate treatment of CWT and non-CWT wastewater. Rather, EPA requiresmonitoring or other data establishingthat the required effluent levels are met.The Agency has concluded, however,that separate treatment is economicallyachievable and the Agency hasconcluded that mixing waste will notachieve the pollutant reductionassociated with best availabletechnology. Consequently, as explainedabove, EPA is proposing to requiremonitoring for compliance at a pointimmediately following treatment of theCWT waste stream. In the case offacilities that mix CWT wastes withother wastes (or mix differentsubcategories of CWT waste streams) fortreatment, EPA has proposed to requirea facility to demonstrate that treatmentprocesses employed result in reductionin the quantity of pollutants discharged

that is equivalent to that achieved byseparate treatment.

The Agency has concluded it has theauthority to adopt such a requirement.Under the Clean Water Act, effluentlimitations must ensure theachievement of the discharge levelsassociated with BPT/BCT/BATtechnology. The data collected by theAgency establishes that today’sproposed BPT/BCT/BAT limitations andstandards are available at a cost notincommensurate with the expectedeffluent reduction and no more stringentlimitations are economically achievable.Without a requirement to demonstratecompliance with the limitations andstandards, EPA cannot ensure that thelimitations and standards will be met.

3. Estimation of Industry SizeFrom the information obtained from

the 1991 Waste Treatment IndustryQuestionnaire, EPA estimates that thereare 85 facilities in the Centralized WasteTreatment Industry. Permit writers andindustry representatives believe this isan underestimation of the presentindustry size. EPA’s estimation of Theindustry size is based on data providedfrom questionnaire mailed to facilitiesthat EPA identified using informationavailable to it in 1989. As stated earlier,facilities names were gathered fromvarious sources, because no SIC codeexists for the industry. Therefore, theremay have been CWT facilities notincluded on the questionnaire mailinglist. EPA solicits information on thenumber, name, and location of facilitieswithin the industry.

4. Exclusion of Pipeline CentralizedWaste Treatment Facilities From Scopeof Rule

The Agency proposes to exclude fromthis regulation facilities which receiveall waste from off-site by pipeline fromthe source of waste generation.6 Basedon the information gathered in the 1991Waste Treatment IndustryQuestionnaire, such facilities arefundamentally different from those thatare the subject of today’s proposal.These pipeline facilities receive steadyflows of relatively consistent pollutantprofiles from facilities that in most casesare subject to categorical regulations. Bycontrast, centralized waste treatmentfacilities receive concentrated wasteswith highly variable pollutant content,

such as sludges, tank bottoms, off-specproducts, and process residuals. Permitwriters should use the building blockapproach in conjunction with theappropriate guidelines for the facilitiesdischarging to the pipeline facility toderive the appropriate BPJ effluentlimitations for these facilities. TheAgency solicits comment on excludingsuch facilities from this scope of thisrule as well as comment on thisapproach to permitting pipelinefacilities.

5. De minimis Level for Scope ofRegulation

According to comments received fromthe May 1994 Effluent Guidelines Plan(59 FR 25859), the EPA should considerestablishing a de minimis level for thescope of the regulations due to possiblemanagement practices at manufacturingfacilities. Manufacturers may receivesmall quantities of waste from off-site totreat in a wastewater treatment systemdue to a site’s ability to handle thewaste properly in comparison to the siteat which the waste is generated.Information collected from the 1991Waste Treatment IndustryQuestionnaire was not designed tocollect this information due to themethod of creating the mailing list. EPAsolicits additional data to determine if ade minimis level should be establishedand information on the appropriatelevel.

6. Characterization of Waste Receivedby Oils Subcategory Facilities

In the EPA sampling program for theOils Subcategory, the EPA focused onfacilities which treat concentrated,stable oil-water emulsions which aredifficult to treat, because the majority offacilities identified in 1989 with on-sitetreatment accepted this type of waste.EPA requests information on the type ofoily waste (stable, unstable, etc.)accepted for treatment by facilities inthe Oils Subcategory as well as theconstituents found in the waste.

7. Methodology for Estimating CurrentPerformance

Many facilities in the CentralizedWaste Treatment Industry comminglewaste receipts from off-site with otheron-site generated wastewater, such asnon-contaminated stormwater and otherindustrial wastewater, prior todischarging. This mixing of waste mayoccur prior to or after treatment of thewaste receipts. Because thecommingling occurs prior to thedischarge point, monitoring datacollected by facilities at the dischargepoint cannot be used to estimate thecurrent treatment performance of certain


centralized waste treatment operations.Under the approach EPA is proposing,in the case of the introduction ofstormwater after treatment but beforedischarge, the allowable discharges fromsuch a facility would be based on theguideline limitations and standardsbefore the introduction of thestormwater. In the case of thestormwater or other wastes introducedbefore treatment, as discussedpreviously, the EPA used severalmethods to estimate current industryperformance. EPA solicits comment onthe methodologies used to estimatecurrent discharge performance. EPAalso requests discharge monitoring datafrom facilities prior to commingling theCentralized Waste Treatmentwastewater with other sources ofwastewater. These data will be used toassess current discharge performanceand to statistically analyze theautocorrelation of concentrationsmeasured on consecutive days (SeeSection V.G. for an explanation ofautocorrelation). Before submittingdischarge monitoring data, pleasecontact Debra DiCianna at (202) 260–7141 to ensure that the data providedinclude information to support its usefor calculating current performance andpossible limitations.

8. Implementation of Regulation forMultiple Subcategory Facilities

Forty percent of the facilities in theCentralized Waste Treatment Industryreceive flows that fall within two ormore of the proposed subcategories forthis industry. Since waste receipts inthis industry are concentrated anddifficult to treat, the Agency believesthat the defined levels of effluentreductions will not be met if wastereceipts from different categories aretreated in a single treatment system.EPA has concluded that separatepretreatment steps are necessary inorder to treat the waste receiptsadequately for its constituents prior tocommingling the wastes. For example, ifoily wastes and metal-bearing wastes aremixed, selective metals precipitationwill not remove certain constituents (i.e.n-decane, oil and grease) which wouldbe removed if the oily waste ispretreated before precipitation. Asdiscussed above, the approach whichEPA has proposed would requiremonitoring to demonstrate complianceafter oily waste treatment and aftermetal-bearing treatment. The EPAsolicits comment on other approachesfor implementing the proposal in orderto address the problem of dischargesfrom treatment of mixed subcategorywastes. EPA also requests data on theperformance of treatment systems which

are designed to treat waste that may becharacterized in more than onesubcategory.

9. Applicability of Guideline to POTWsTreating CWT Wastes

EPA is soliciting comment today alsoon how to treat wastes received fortreatment at a POTW by tanker truck,trailer/roll-off bins or barges or otherforms of shipment. EPA is aware thatthere are several POTWs receivingwastes for treatment that are notdischarged to the POTW through sewersor pipes. EPA welcomes additionalinformation and data on the subject.

The CWA provides that pretreatmentstandards apply to all discharges whichpass through or interfere with POTWoperations and all POTWs must complywith effluent limitations based onsecondary treatment requirements andany more stringent limitations,including those necessary to meet waterquality standards, treatment standards,or schedules of compliance establishedpursuant to any other Federal law orregulation. CWA Sections 301(a)(1) and307(b). Under RCRA, under certainconditions, a POTW may accepthazardous waste for treatment. A POTWis deemed to have a permit for treatmentof hazardous waste if, among otherthings, the POTW complies with theconditions of its NPDES permit andcertain RCRA regulatory requirements(e.g., use of the RCRA manifest system,maintaining certain records). Inaddition, the waste must meet ‘‘allFederal State, and local pretreatmentrequirements which would beapplicable to the waste if it were beingdischarged into the POTW through asewer, pipe or similar conveyance.’’ 40CFR 270.61(c)(4). Under this provision,therefore, EPA has concluded that aPOTW cannot accept wastes fortreatment via any form of shipmentwhich are RCRA hazardous wastesunless these wastes comply withpretreatment requirements in today’sguideline. Moreover, it is EPA’s viewthat whether the CWT wastes arehazardous or non-hazardous, thepretreatment standard would apply tothe CWT wastes. As proposed today, thepretreatment standards apply to theintroduction of a pollutant to a POTWirrespective of the mechanism forintroducing that pollutant to the POTW.

EPA is soliciting comment on howwidespread is the practice of POTWtreatment of wastes received from off-site via any form of shipment as well asits tentative conclusion that today’sproposal would apply to such wastes.

10. Treatment of Incidental OrganicPollutants Detected in the MetalsSubcategory

During the EPA sampling program,EPA collected analytical data on thepresence of organic pollutants in theMetals Subcategory. Various organicpollutants were detected at lowconcentrations in the untreated CWTwastewater. EPA sampled treatmenttechnologies to control the discharge oforganic pollutants. In mostcircumstances, the organic pollutantsdetected at low concentrations in thetreatment facility influent were found atnon-detectable levels prior to anytreatment for the organic pollutants.Because the initial concentrations oforganic pollutants were very low, theaddition of treatment chemicals andother sources of CWT wastewatercaused the concentrations to becomelower and thereby non-detectable. Aspreviously discussed, EPA sampledcarbon adsorption units to use as add-on technologies for the removal oforganic compounds, but treatmentperformance for carbon adsorption unitswas found to be uniformly poorthroughout the industry. EPA solicitscomment on the necessity of control onlow level organic pollutants for theMetals subcategory and technologiesappropriate for the control of low levelorganics as well as analytical data tocharacterize the performance of suchtreatment technologies.

11. Additional Technologies for theControl of Concentrated Cyanide-Bearing Wastes

The BPT effluent limitations andstandards for the pretreatment control ofcyanide in the Metals Subcategory isbased on the use of alkaline chlorinationat specific operating conditions whichenable the destruction of concentratedcyanide complexes. Two additionaltreatment technologies were sampled inthe process of developing the proposedregulation. Performance by onetreatment technology was uniformlyinadequate for the treatment ofconcentrated cyanide waste. Theadditional treatment technologysampled performed well in thetreatment of concentrated cyanidecomplexes, but is propriataryinformation. EPA solicits informationon additional treatment technologiesapplicable to the treatment ofconcentrated cyanide complexes thatare commercially available.

12. Probability and Cost of RCRA-Permitted Facilities Undergoing Closure

The Agency has predicted that a fewcompanies may undergo bankruptcy as


a result of the proposed rulemaking. Thepredicted bankruptcies may result inclosure of CWT facilities and the cost ofsuch closure is attributable to thisaction. For RCRA permitted facilities,the cost of such closure may besignificant. EPA solicits comment on theprobability of closure of such facilitiesimpacted by the proposed regulationand the costs associated with closure ofthe treatment operations.

13. Assessing the Effects ofConventional Pollutants

A large portion of the pollutantreductions for the proposed regulationare for conventional pollutants,especially oil and grease. Due thepresent methodology for theenvironmental assessment, the impactsof conventional pollutants are not takeninto account for the proposedregulation. The Agency solicitscomment on possible approaches forassessing the effect of conventionalpollutants and pollutant parameters,such as TOC and COD, on the waterquality of receiving streams and POTWoperations in terms of inhibition andsludge contamination.


Environmental protection, Hazardouswaste, Waste treatment and disposal,Water pollution control.

Dated: December 15, 1994.Carol M. Browner,Administrator.

For the reasons set out in thepreamble, title 40, chapter I of the Codeof Federal Regulations is proposed to beamended by adding part 437 as follows:

PART 437—THE CENTRALIZEDWASTE TREATMENT INDUSTRYPOINT SOURCE CATEGORY

General Provisions

Sec.437.1 General definitions.437.2 Applicability.437.3 Monitoring requirements.

Subpart A—Metals Treatment and RecoverySubcategory

Sec.437.10 Applicability; description of the

Metals Subcategory.437.11 Specialized definitions.437.12 Effluent limitations representing the

degree of effluent reduction attainable bythe application of best practicablecontrol technology currently available(BPT).

437.13 Effluent limitations representing thedegree of effluent reduction attainable bythe application of the best conventionalpollutant control technology (BCT).

437.14 Effluent limitations representing thedegree of effluent reduction attainable bythe application of best availabletechnology economically achievable(BAT).

437.15 New source performance standards(NSPS).

437.16 Pretreatment standards for existingsources (PSES).

437.17 Pretreatment standards for newsources (PSNS).

Subpart B—Oils Treatment and RecoverySubcategory

Sec.437.20 Applicability; description of the Oils

Subcategory.437.21 Specialized definitions.437.22 Effluent limitations representing the







Subpart C—Organics Treatment orRecovery SubcategorySec.437.30 Applicability; description of the

Organics Subcategory.437.31 Specialized definitions.437.32 Effluent limitations representing the







Authority: 33 U.S.C. 1311, 1314, 1316,1317, and 1361.

General Provisions

§ 437.1 General definitions.In addition to the definitions set forth

in 40 CFR part 401, the followingdefinitions apply to this part:

(a) Centralized waste treatmentfacility—Any facility that treats any

hazardous or non-hazardous industrialwastes received from off-site by tankertruck, trailer/roll-off bins, drums, barge,or other forms of shipment. A‘‘centralized waste treatment facility’’includes: A facility that treats wastereceived from off-site exclusively; and afacility that treats wastes generated on-site as well as waste received from off-site.

(b) Centralized waste treatmentwastewater—Water that comes incontact with wastes received from off-site for treatment or recovery or thatcomes in contact with the area in whichthe off-site wastes are received, stored orcollected.

(c) Conventional pollutants—Thepollutants identified in section 304(a)(4)of the CWA and the regulationsthereunder (biochemical oxygendemand (BOD5), total suspended solids(TSS), oil and grease, pH, and fecalcoliform).

(d) Facility—A facility is allcontiguous property owned, operated,leased or under the control of the sameperson. The contiguous property may bedivided by public or private right-of-way.

(e) Metal-bearing wastes—Wastes thatcontain metal pollutants frommanufacturing or processing facilities orother commercial operations. Thesewastes may include, but are not limitedto, the following: process wastewater,process residuals such as tank bottomsor stills and process wastewatertreatment residuals, such as treatmentsludges.

(f) New source—‘‘New source’’ isdefined at 40 CFR 122.2 and 122.29.

(g) Non-conventional pollutants—Pollutants that are neither conventionalpollutants nor priority pollutants.

(h) Off-site—‘‘Off-site’’ means outsidethe boundaries of a facility.

(i) Oily wastes—Wastes that containoil and grease from manufacturing orprocessing facilities or other commercialoperations. These wastes may include,but are not limited to, the following:spent lubricants, cleaning fluids,process wastewater, process residualssuch as tank bottoms or stills andprocess wastewater treatment residuals,such as treatment sludges.

(j) On-site—‘‘On-site’’ means withinthe boundaries of a facility.

(k) Organic wastes—Wastes thatcontain organic pollutants frommanufacturing or processing facilities orother commercial operations. Thesewastes may include, but are not limitedto, process wastewater, processresiduals such as tank bottoms or stillsand process wastewater treatmentresiduals, such as treatment sludges.


(l) Pipeline—‘‘Pipeline’’ means anopen or closed conduit used for theconveyance of material. A pipelineincludes a channel, pipe, tube, trench orditch.

(m) POTW—Publicly-ownedtreatment works as defined at 40 CFR403.3 (o).

(n) Priority pollutants—The pollutantsdesignated by EPA as priority in 40 CFRpart 423, appendix A.

(o) Process wastewater—‘‘Processwastewater’’ is defined at 40 CFR 122.2.

§ 437.2 Applicability.

(a) Notwithstanding anything to thecontrary in subchapter N of this chapter,the provisions of this part are applicableto that portion of wastewater dischargesfrom a centralized waste treatmentfacility that result from the treatment orrecovery of metals, oil, and organicsfrom metal-bearing wastes, oily wastesand organic-bearing wastes receivedfrom off-site. The provisions of this Partare also applicable to that portion ofwastewater discharge from a CWTfacility contact water. The provisions ofthis part do not apply to that portion ofwastewater discharges from a CWTfacility that results from the treatment ofwastes that are generated on-site whichare subject to other applicableprovisions of Subchapter N of thischapter.

(b) The provisions of this part do notapply to wastewater discharges at acentralized waste treatment facility thatresult from the following treatmentoperations: thermal destruction,incineration, stabilization,solidification, the blending of fuel andrecycling of solvents from hazardousand non-hazardous industrial wastesreceived from off-site.

(c) The provisions of this part do notapply to discharges from a centralizedwaste treatment facility that result fromthe treatment or recovery of wastesreceived by pipeline from a facility thatgenerates the waste.

§ 437.3 Monitoring requirements.

The following monitoringrequirements apply to this part:

(a) The ‘‘monthly average’’ regulatoryvalues shall be the basis for the monthlyaverage effluent limitations in directdischarge permits and pretreatmentstandards. Compliance with themonthly average discharge limit isrequired regardless of the number ofsamples analyzed and averaged.

(b) Any centralized waste treatmentfacility that discharges wastewater thatresults from the treatment of metal-bearing waste, oily waste, or organic-bearing waste must monitor as follows:

(1) A centralized waste treatmentfacility must monitor to demonstratecompliance with applicable SubcategoryA, B, or C limitations or standards.

(2) When a Centralized WasteTreatment facility: is subject to effluentlimitations, new source performancestandards or pretreatment standards inmore than one Subpart of this Part (orany other Part of Subchapter N of thischapter), and (after treatment) mixeswaste whose wastewater treatmentdischarges are subject to more than oneSubpart of this Part (or any other Partof Subchapter N of this chapter), theowner or operator of the CentralizedWaste Treatment facility must monitorfor compliance with the limitations foreach Subpart of this Part after treatmentand before mixing of the waste fordischarge with any other Subpartwastes, process wastewater subject toanother effluent limitation or standardin Subchapter N of this chapter, orstormwater. A Centralized WasteTreatment facility is not required tomonitor for compliance after treatmentand before mixing of Subpart wastesthat are mixed with other wastes fortreatment and discharge if the followingcondition is met. The owner or operatorof the Centralized Waste Treatmentfacility must demonstrate to the POTWor permitting authority that theCentralized Waste Treatment facilitytreating and discharging effluent fromthe mixture of wastes is capable ofachieving the effluent limitation orstandard for each Subpart.

(3) When a Centralized WasteTreatment facility: is subject to effluentlimitations, new source performancestandards or pretreatment standards inmore than one Subpart of this Part (orany other Part of Subchapter N of thischapter), and (prior to treatment) mixeswaste whose wastewater treatmentdischarges are subject to more than oneSubpart of this Part (or any other Partof Subchapter N), the owner or operatorof the Centralized Waste Treatmentfacility must demonstrate to the POTWor permitting authority that theCentralized Waste Treatment facilitytreating and discharging effluent fromthe mixture of wastes is capable ofachieving the effluent limitation orstandard for each Subpart.

(4) A centralized waste treatmentfacility must monitor for cyanide aftercyanide treatment and before dilutionwith other waste streams. Periodicanalysis for cyanide is not required fora centralized waste treatment facility inthe metal-bearing waste subcategorywhen the following condition is met:The owner or operator of the facilitycertifies in writing to the POTW orpermit issuing authority that the

centralized waste treatment system isnot treating wastes that contain morethan 68 mg/l of Total Cyanide.

Subpart A—Metals Treatment andRecovery Subcategory

§ 437.10 Applicability; description of theMetals Subcategory.

The provisions of this subpart areapplicable to that portion of wastewaterdischarges from a centralized wastetreatment facility that result from thetreatment of, or recovery of metals from,metal-bearing waste received from off-site and CWT facility contact water.

§ 437.11 Specialized definitions.The general definitions, abbreviations,

and methods of analysis set forth in 40CFR part 401 and § 437.01 shall applyto this subpart.

§ 437.12 Effluent limitations representingthe degree of effluent reduction attainableby the application of best practicablecontrol technology currently available(BPT).

Except as provided in 40 CFR 125.30through 125.32, any existing pointsource subject to this subpart mustachieve the effluent limitations listed inthe following table representing thedegree of effluent reduction attainableby the application of the best practicablecontrol technology currently available(BPT). These limitations apply to thepretreatment of metal-bearing wastewhich contain cyanide and the metalstreatment effluent.

IN-FACILITY BPT LIMITATIONS FOR CY-ANIDE PRETREATMENT.—METALSSUBCATEGORY (MG/L)

Pollutant or pollutantparameter

Maximumfor anyone day

Monthlyaverage

Total Cyanide ........... 350 130

BPT EFFLUENT LIMITATIONS—METALSSUBCATEGORY (mg/l)


Maxi-mum forany one

day

Monthlyaverage

Conventional Pollut-ants:Oil and Grease ..... 45 11TSS ....................... 55 18

Priority and Non-Con-ventional Pollut-ants:Aluminum .............. 0.72 0.16Antimony ............... 0.14 0.031Arsenic .................. 0.076 0.017Barium ................... 0.14 0.032Cadmium ............... 0.73 0.16Chromium ............. 0.77 0.17


BPT EFFLUENT LIMITATIONS—METALSSUBCATEGORY (mg/l)—Continued


Maxi-mum forany one

day

Monthlyaverage

Cobalt .................... 0.73 0.16Copper .................. 1.0 0.23Hexavalent Chro-

mium .................. 0.14 0.077Iron ........................ 2.4 0.54Lead ...................... 0.37 0.082Magnesium ........... 9.9 2.2Manganese ........... 0.18 0.039Mercury ................. 0.013 0.0030Nickel .................... 5.4 1.2Silver ..................... 0.028 0.0063Tin ......................... 0.20 0.044Titanium ................ 0.021 0.0047Total Cyanide ........ 4.4 1.2Zinc ....................... 1.2 0.27

§ 437.13 Effluent limitations representingthe degree of effluent reduction attainableby the application of the best conventionalpollutant control technology (BCT).

Except as provided in 40 CFR 125.30through 125.32, any existing pointsource subject to this subpart mustachieve the effluent limitationsrepresenting the degree of effluentreduction attainable by the applicationof the best conventional pollutantcontrol technology (BCT). Thelimitations for TSS and Oil and Greaseshall be the same as those specified in§ 437.12 for the best practicable controltechnology currently available (BPT).

§ 437.14 Effluent limitations representingthe degree of effluent reduction attainableby the application of best availabletechnology economically achievable (BAT).

Except as provided in 40 CFR 125.30through 125.32, any existing pointsource subject to this subpart mustachieve the effluent limitationsrepresenting the degree of effluentreduction attainable by the applicationof the best available technologyeconomically achievable (BAT). Thelimitations shall be the same as thosespecified in § 437.12 for the bestpracticable control technology currentlyavailable (BPT) for the priority and non-conventional pollutants listed.

§ 437.15 New source performancestandards (NSPS).

Any new source subject to thissubpart must achieve new source

performance standards (NSPS). Theselimitations apply to the metalstreatment effluent. The limitations shallbe the same as those specified in§ 437.12 for the best practicable controltechnology currently available (BPT).

§ 437.16 Pretreatment standards forexisting sources (PSES).

Except as provided in 40 CFR 403.7and 403.13, any existing source subjectto this subpart that introducespollutants into a publicly-ownedtreatment works (or any source thatintroduces hazardous or non-hazardouswaste into a POTW from off-site bytanker truck, trailer/roll-off bins, drums,barge or other form of shipment) must:Comply with 40 CFR part 403; andachieve the following pretreatmentstandards for existing sources (PSES).

IN-FACILITY PRETREATMENT STAND-ARDS FOR CYANIDEPRETREATMENT.—METALS SUB-CATEGORY (mg/l)


Maxi-mum forany one

day

Monthlyaverage

Total Cyanide ........... 350 130

PRETREATMENT STANDARDS.—METALSSUBCATEGORY (mg/l)


Maxi-mum forany one

day

Monthlyaverage

Aluminum .................. 0.72 0.16Antimony ................... 0.14 0.031Arsenic ...................... 0.076 0.017Cadmium .................. 0.73 0.16Chromium ................. 0.77 0.17Cobalt ....................... 0.73 0.16Copper ...................... 1.0 0.23Hexavalent Chro-

mium ..................... 0.14 0.077Iron ........................... 2.4 0.54Lead .......................... 0.37 0.082Magnesium ............... 9.9 2.2Manganese ............... 0.18 0.039Mercury ..................... 0.013 0.0030Nickel ........................ 5.4 1.2Silver ......................... 0.028 0.0063Tin ............................. 0.20 0.044Titanium .................... 0.021 0.0047Total Cyanide ........... 4.4 1.2Zinc ........................... 1.2 0.27

§ 437.17 Pretreatment standards for newsources (PSNS).

Except as provided in 40 CFR 403.7,any new source subject to this subpartthat introduces pollutants into apublicly-owned treatment works (or anynew source that introduces hazardous ornon-hazardous waste into a POTW fromoff-site by tanker truck, trailer/roll-offbins, drums, barge or other form ofshipment) must: Comply with 40 CFRpart 403; and achieve the pretreatmentstandards for new sources (PSNS). Thelimitations shall be the same as thosespecified in § 437.16 for thepretreatment standards for existingsources (PSES).

Subpart B—Oils Treatment andRecovery Subcategory

§ 437.20 Applicability; description of theOils Subcategory.

The provisions of this subpart areapplicable to that portion of wastewaterdischarges from a centralized wastetreatment facility that result from thetreatment of, or recovery of oils from,oily waste received from off-site andCWT facility contact water.

§ 437.21 Specialized definitions

The general definitions, abbreviations,and methods of analysis set forth in 40CFR part 401 and § 437.01 shall applyto this subpart.

§ 437.22 Effluent limitations representingthe degree of effluent reduction attainableby the application of the best practicablecontrol technology currently available(BPT).

Except as provided in 40 CFR 125.30through 125.32, any existing pointsource subject to this subpart mustachieve the following effluentlimitations representing the degree ofeffluent reduction attainable by theapplication of the best practicablecontrol technology currently available(BPT).

BPT EFFLUENT LIMITATIONS.—OILS SUBCATEGORY (mg/l)

Pollutant or pollutant parameter

Option 2 Option 3

Maximum forany one day

Monthly aver-age


Monthly aver-age

Conventional Pollutants:Oil and Grease ................................................................................................. 30,000 5,900 240 64


BPT EFFLUENT LIMITATIONS.—OILS SUBCATEGORY (mg/l)—Continued


Option 2 Option 3


Monthly aver-age


Monthly aver-age

TSS .................................................................................................................. 24 8.2 4.0 1.4Priority and Non-Conventional Pollutants:

1,1,1-Trichloroethane ....................................................................................... 1.6 1.0 0.18 0.122-Propanone ..................................................................................................... 41 22 130 444-Chloro-3-Methyl Phenol ................................................................................ 5.2 4.4 0.96 0.54Aluminum ......................................................................................................... 2.3 0.57 0.085 0.038Barium .............................................................................................................. 0.10 0.026 0.0027 0.0012Benzene ........................................................................................................... 9.0 6.8 1.8 1.4Butanone .......................................................................................................... 3.7 2.0 13 4.3Cadmium .......................................................................................................... 1.5 0.37 0.0046 0.0020Chromium ......................................................................................................... 2.2 0.54 0.010 0.0045Copper .............................................................................................................. 2.0 0.50 0.016 0.0073Ethylbenzene .................................................................................................... 1.1 0.86 0.085 0.066Iron ................................................................................................................... 75 19 0.40 0.18Lead ................................................................................................................. 5.0 1.2 0.076 0.034Manganese ....................................................................................................... 5.4 1.3 0.043 0.019Methylene Chloride .......................................................................................... 3.9 2.0 2.2 0.91m-Xylene .......................................................................................................... 1.6 1.2 0.074 0.058Nickel ................................................................................................................ 120 29 2.2 0.99n-Decane .......................................................................................................... 0.18 0.096 0.19 0.067n-Docosane ...................................................................................................... 0.18 0.096 0.19 0.067n-Dodecane ...................................................................................................... 0.18 0.096 0.19 0.067n-Eicosane ....................................................................................................... 0.18 0.096 0.19 0.067n-Hexacosane .................................................................................................. 0.18 0.096 0.19 0.067n-Hexadecane .................................................................................................. 0.18 0.096 0.19 0.067n-Octadecane ................................................................................................... 0.18 0.096 0.19 0.067n-Tetradecane .................................................................................................. 0.18 0.096 0.19 0.067o&p-Xylene ....................................................................................................... 0.86 0.65 0.045 0.035Tetrachloroethene ............................................................................................ 0.23 0.14 0.032 0.016Tin .................................................................................................................... 0.82 0.20 0.12 0.056Toluene ............................................................................................................ 17 13 1.8 1.4Tripropyleneglycol Methyl Ether ....................................................................... 280 150 160 57Zinc ................................................................................................................... 22 5.6 0.54 0.24


Except as provided in 40 CFR 125.30through 125.32, any existing pointsource subject to this subpart mustachieve the following effluentlimitations representing the degree ofeffluent reduction attainable by theapplication of the best conventionalpollutant control technology (BCT). Thelimitations for TSS and Oil and Greaseshall be the same as those specified in§ 437.22 for the best practicable controltechnology currently available (BPT).


Except as provided in 40 CFR 125.30through 125.32, any existing pointsource subject to this subpart mustachieve the following effluentlimitations representing the degree ofeffluent reduction attainable by theapplication of the best availabletechnology economically achievable(BAT). The limitations shall be the sameas those specified in § 437.22 for thebest practicable control technologycurrently available (BPT) for the priorityand non-conventional pollutants listed.


Any new source subject to thissubpart must achieve the following new

source performance standards (NSPS).These limitations apply to the oilstreatment effluent. The limitations shallbe the same as those specified in§ 437.22 for the best practicable controltechnology currently available (BPT).


Except as provided in 40 CFR 403.7and 403.13, any existing source subjectto this subpart that introducespollutants into a publicly-ownedtreatment works (or any source thatintroduces hazardous or non-hazardouswaste into a POTW from off-site bytanker truck, trailer/roll-off bins, drums,barge or other form of shipment) must:comply with 40 CFR part 403; andachieve the following pretreatmentstandards for existing sources (PSES).


PRETREATMENT STANDARDS.—OILS SUBCATEGORY (mg/l)


Option 2 Option 3

Maxi-mum forany one

day

Monthlyaverage

Maximumfor anyone day

Monthlyaverage

1,1,1-Trichloroethane .......................................................................................................................... 1.6 1.0 0.18 0.122-Propanone ........................................................................................................................................ 41 22 130 444-Chloro-3-Methyl Phenol ................................................................................................................... 5.2 4.4 0.96 0.54Aluminum ............................................................................................................................................. 2.3 0.57 0.085 0.038Barium ................................................................................................................................................. 0.10 0.026 0.0027 0.0012Benzene .............................................................................................................................................. 9.0 6.8 1.8 1.4Butanone ............................................................................................................................................. 3.7 2.0 13 4.3Cadmium ............................................................................................................................................. 1.5 0.37 0.0046 0.0020Chromium ............................................................................................................................................ 2.2 0.54 0.010 0.0045Copper ................................................................................................................................................. 2.0 0.50 0.016 0.0073Ethylbenzene ....................................................................................................................................... 1.1 0.86 0.085 0.066Iron ...................................................................................................................................................... 75 19 0.40 0.18Lead ..................................................................................................................................................... 5.0 1.2 0.076 0.034Manganese .......................................................................................................................................... 5.4 1.3 0.043 0.019Methylene Chloride ............................................................................................................................. 3.9 2.0 2.2 0.91m-Xylene ............................................................................................................................................. 1.6 1.2 0.074 0.058Nickel ................................................................................................................................................... NA NA 2.2 0.99n-Decane ............................................................................................................................................. 0.18 0.096 0.19 0.067n-Docosane ......................................................................................................................................... 0.18 0.096 0.19 0.067n-Dodecane ......................................................................................................................................... 0.18 0.096 0.19 0.067n-Eicosane ........................................................................................................................................... 0.18 0.096 0.19 0.067n-Hexacosane ..................................................................................................................................... 0.18 0.096 0.19 0.067n-Hexadecane ..................................................................................................................................... 0.18 0.096 0.19 0.067n-Octadecane ...................................................................................................................................... 0.18 0.096 0.19 0.067n-Tetradecane ..................................................................................................................................... 0.18 0.096 0.19 0.067o&p-Xylene .......................................................................................................................................... 0.86 0.65 0.045 0.035Tetrachloroethene ............................................................................................................................... 0.23 0.14 0.032 0.016Tin ........................................................................................................................................................ 0.82 0.20 0.12 0.056Toluene ................................................................................................................................................ 17 13 1.8 1.4Tripropyleneglycol Methyl Ether .......................................................................................................... NA NA 160 57Zinc ...................................................................................................................................................... NA NA 0.54 0.24

NA= No pretreatment standards are developed: pollutant was determined not to ‘‘pass-through.’’


Except as provided in 40 CFR 403.7,any new source subject to this subpartthat introduces pollutants into apublicly-owned treatment works (or anynew source that introduces hazardous ornon-hazardous waste into a POTW fromoff-site by tanker truck, trailer/roll-offbins, drums, barge or other form ofshipment) must: Comply with 40 CFRpart 403; and achieve pretreatmentstandards for new sources (PSNS). Thelimitations shall be the same as thosespecified in § 437.26 of this subpart forthe pretreatment standards for existingsources (PSES).

Subpart C—Organics Treatment orRecovery Subcategory

§ 437.30 Applicability; description of theOrganics Subcategory.

The provisions of this subpart areapplicable to that portion of wastewaterdischarges from a centralized wastetreatment facility that result from thetreatment of, or recovery of organicsfrom, organic-bearing waste received

from off-site and CWT facility contactwater.

§ 437.31 Specialized definitions.

The general definitions, abbreviations,and methods of analysis set forth in 40CFR part 401 and § 437.01 shall applyto this subpart.

§ 437.32 Effluent limitations representingthe degree of effluent reduction attainableby the application of best practicablecontrol technology currently available(BPT).

Except as provided in 40 CFR 125.30through 125.32, any existing pointsource subject to this subpart mustachieve the following effluentlimitations representing the degree ofeffluent reduction attainable by theapplication of the best practicablecontrol technology currently available(BPT).

BPT EFFLUENT LIMITATIONS.—ORGANICS SUBCATEGORY (mg/l)


Maxi-mum forany one

day

Monthlyaverage

Conventional Pollutants:BOD5 ......................... 163 53Oil and Grease ......... 13 4.9TSS ........................... 216 61

Priority and Non-Con-ventional Pollutants:1,1,1,2-

Tetrachloroethane . 0.013 0.0111,1,1-Trichloroethane 0.021 0.0181,1,2-Trichloroethane 0.21 0.171,1-Dichloroethane .... 0.037 0.0271,2,3-

Trichloropropane ... 0.016 0.0141,2-Dibromoethane ... 0.014 0.0111,2-Dichloroethane .... 0.031 0.0252,3-Dichloroaniline .... 0.17 0.14Butanone ................... 1.1 0.842-Propanone ............. 1.6 1.34-Methyl-2-Pentanone 0.093 0.074Acetophenone ........... 0.048 0.022Aluminum .................. 1.3 0.75Antimony ................... 0.42 0.24Barium ....................... 3.8 2.2Benzene .................... 0.014 0.011


BPT EFFLUENT LIMITATIONS.—ORGANICS SUBCATEGORY (mg/l)—Continued


Maxi-mum forany one

day

Monthlyaverage

Benzoic Acid ............. 0.49 0.24Carbon Disulfide ....... 0.16 0.11Chloroform ................ 0.56 0.48Diethyl Ether ............. 0.070 0.056Hexanoic Acid ........... 0.51 0.25Lead .......................... 0.16 0.095Methylene Chloride ... 1.1 0.97Molybdenum ............. 0.98 0.57m-Xylene ................... 0.014 0.011o-Cresol .................... 0.051 0.025Phenol ....................... 0.79 0.38Pyridine ..................... 0.71 0.24p-Cresol .................... 0.098 0.040Tetrachloroethene ..... 0.73 0.53Tetrachloromethane .. 0.013 0.011Toluene ..................... 0.014 0.011trans-1,2-

dichloroethene ....... 0.15 0.11Trichloroethene ......... 1.2 0.86Vinyl Chloride ............ 0.071 0.052Zinc ........................... 0.43 0.25


Except as provided in 40 CFR 125.30through 125.32, any existing pointsource subject to this subpart mustachieve the following effluentlimitations representing the degree ofeffluent reduction attainable by theapplication of the best conventionalpollutant control technology (BCT). Thelimitations for BOD5. TSS, and Oil andGrease shall be the same as thosespecified in § 437.32 of this subpart forthe best practicable control technologycurrently available (BPT).


Except as provided in 40 CFR 125.30through 125.32, any existing point

source subject to this subpart mustachieve limitations representing thedegree of effluent reduction attainableby the application of the best availabletechnology economically achievable(BAT). The limitations shall be the sameas those specified in § 437.32 for thebest practicable control technologycurrently available (BPT) for the priorityand non-conventional pollutants listed.


Any new source subject to thissubpart must achieve the following newsource performance standards (NSPS).These limitations apply to the organicstreatment effluent. The limitations shallbe the same as those specified in§ 437.32 for the best practicable controltechnology currently available (BPT).


Except as provided in 40 CFR 403.7and 403.13, any existing source subjectto this subpart that introducespollutants into a publicly-ownedtreatment works (or any source thatintroduces hazardous or non-hazardouswaste into a POTW from off-site bytanker truck, trailer/roll-off bins, drums,barge or other form of shipment) must:comply with 40 CFR part 403; andachieve the following pretreatmentstandards for existing sources (PSES).

PRETREATMENT STANDARDS—ORGANICS SUBCATEGORY (mg/l)


Maxi-mum forany one

day

Monthlyaverage

1,1,1,2-Tetrachloroethane ..... 0.013 0.011

1,1,1-Trichloroethane ... 0.021 0.0181,1,2-Trichloroethane ... 0.21 0.171,1-Dichloroethene ....... 0.037 0.0271,2,3-Trichloropropane . 0.016 0.0141,2-Dibromoethane ....... 0.014 0.0111,2-Dichloroethane ....... 0.031 0.0252,3-Dichloroaniline ........ 0.17 0.14

PRETREATMENT STANDARDS—ORGANICS SUBCATEGORY (mg/l)—Continued


Maxi-mum forany one

day

Monthlyaverage

4-Methyl-2-Pentanone .. 0.093 0.074Acetophenone .............. 0.048 0.022Aluminum ...................... 1.3 0.75Antimony ....................... 0.42 0.24Barium .......................... 3.8 2.2Benzene ....................... 0.014 0.011Benzoic Acid ................. 0.49 0.24Butanone ...................... 1.1 0.84Carbon Disulfide ........... 0.16 0.11Chloroform .................... 0.56 0.48Diethyl Ether ................. 0.070 0.056Hexanoic Acid .............. 0.51 0.25Methylene Chloride ...... 1.1 0.97Molybdenum ................. 0.98 0.57m-Xylene ...................... 0.014 0.011o-Cresol ........................ 0.051 0.025p-Cresol ........................ 0.098 0.040Tetrachloroethene ........ 0.73 0.53Tetrachloromethane ..... 0.013 0.011Toluene ......................... 0.014 0.011trans-1,2-dichloroethene 0.15 0.11Trichloroethene ............. 1.2 0.86Vinyl Chloride ............... 0.071 0.052


Except as provided in 40 CFR 403.7,any new source subject to this subpartthat introduces pollutants into apublicly-owned treatment works (or anynew source that introduces hazardous ornon-hazardous waste into a POTW fromoff-site by tanker truck, trailer/roll-offbins, drums, barge or other form ofshipment) must: comply with 40 CFRpart 403; and achieve pretreatmentstandards for new sources (PSNS). Thelimitations shall be the same as thosespecified in § 437.36 for thepretreatment standards for existingsources (PSES).


fede

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Part III

Department ofTransportationFederal Highway AdministrationFederal Transit Administration

Interim Policy and Questions andAnswers on Public Involvement inTransportation Decisionmaking; Notice



Federal Highway Administration

Federal Transit Administration

[FHWA/FTA Docket No. 94–27]

Interim Policy and Questions andAnswers on Public Involvement inTransportation Decisionmaking

AGENCIES: Federal HighwayAdministration (FHWA), FederalTransit Administration (FTA), DOT.ACTION: Notice; request for comments.

SUMMARY: This notice announces thejoint FHWA and FTA Interim Policy onPublic Involvement and Questions andAnswers on Public Involvement inTransportation Decisionmaking. TheInterim Policy outlines the principlesthe agencies intend to use in carryingout their responsibilities for assuringthat State departments of transportation,metropolitan planning organizations,and transportation providers involve thepublic in transportation decisionmakingfrom the earliest stages of metropolitanand statewide transportation planningthrough federally-aided transportationproject development and construction.The Questions and Answers on PublicInvolvement in TransportationDecisionmaking are agency guidance onpublic involvement.DATES: Comments must be received onor before April 30, 1995.ADDRESSES: Written comments shouldbe sent to the Federal HighwayAdministration, Office of the ChiefCounsel, Docket No. 94–27, Room 4232,HCC–10, 400 Seventh Street, SW.,Washington, DC 20590. All commentsreceived will be available forexamination at the above address from8:30 a.m. to 3:30 p.m., e.t., Mondaythrough Friday, except Federal holidays.FOR FURTHER INFORMATION CONTACT: Forthe FHWA: Mrs. Florence W. Mills,Environmental Programs Branch (HEP–32), (202) 366–2062 or Mr. Robert J.Black, FHWA Office of the ChiefCounsel (HCC–31), (202) 366–1359. Forthe FTA: Mrs. Jennifer L. Weeks,Resource Management Division (TGM–21), (202) 366–6510 or Mr. Scott A.Biehl, FTA Office of the Chief Counsel(TCC–40), (202) 366–4063. Bothagencies are located at 400 SeventhStreet, SW., Washington, DC 20590.Office hours for the FHWA are from7:45 a.m. to 4:15 p.m., e.t., and for theFTA are from 8:30 a.m. to 5 p.m., e.t.,Monday through Friday, except Federalholidays.SUPPLEMENTARY INFORMATION: Recentstatutes and regulations have increased

both the FHWA’s and the FTA’slongstanding responsibility for publicinvolvement in transportationdecisionmaking. The metropolitan andstatewide planning provisions insections 1024, 1025, and 3012 of theIntermodal Surface TransportationEfficiency Act of 1991 (ISTEA), Pub. L.102–240, 105 Stat. 1914, 1955, 1962,and 2098, amended Title 23, U.S.C., andTitle 49, U.S.C., chapter 53 (formerly theFederal Transit Act) by revising 23U.S.C. 134 and the FTA’s planningauthorities. Title 23, U.S.C., and Title49, U.S.C., govern the metropolitantransportation planning process. TheISTEA also established a new provisionfor statewide transportation planning at23 U.S.C. 135. These statutes requirethat interested parties be afforded anopportunity for public comment ontransportation plans and programsduring the metropolitan and statewidetransportation planning processes. TheFHWA and the FTA revised theirprevious planning regulations toimplement these changes and publishedthe final regulations on October 28,1993 (58 FR 58040). These planningregulations are found at 23 CFR Part450.

There are three statutes andassociated regulations governing publicinvolvement during the environmentalstudies stage of highway and transitproject development: (1) the NationalEnvironmental Policy Act (NEPA), Pub.L. 91–190, 83 Stat. 852, as amended(codified at 42 U.S.C. 4321 et seq.),implemented in regulations found at 40CFR Parts 1500–1508); (2) 23 U.S.C 128;and (3) 23 U.S.C. 109(h). The FHWAand the FTA are in the early stages ofrevising their joint regulation onenvironmental impact and relatedprocedures found in 23 CFR Part 771.

As part of an ongoing commitment topublic involvement throughout thetransportation planning and projectdevelopment processes, the FHWA andthe FTA are soliciting public input onthis Interim Policy and guidance. TheInterim Policy frames Federal policieson public involvement in actions of theFHWA and the FTA. The Questions andAnswers provide additional informationinterpreting regulations with respect topublic involvement. The FHWA and theFTA are particularly interested incomments on how their policy andguidance can effectively support Statedepartments of transportation,metropolitan planning organizations,and transportation providers indeveloping and implementing locallyeffective public involvement processesand techniques which encompass allmembers of the public, including thosewho are currently under served by our

transportation system. The FHWA andthe FTA also seek information onadditional public involvement issueswhere guidance or technicalinformation is needed. The two agenciesare issuing this Interim Policy andguidance to start discussion on thesetopics. The Interim Policy and guidanceare effective as of December 5, 1994.The final policy will reflect thecomments received on the InterimPolicy. Based on public and agencyinput, the two agencies will consideradditional guidance in publicinvolvement.

The text of the Interim Policy and theQuestions and Answers follows.

FHWA/FTA Interim Policy on PublicInvolvement

‘‘I know of no safe depository of theultimate powers of society but thepeople themselves.’’—Thomas Jefferson

Secretary of Transportation FedericoPena’s Strategic Plan establishes theobjective of putting people first in all ofthe Department’s endeavors. Consistentwith this objective, it is the policy of theFHWA and the FTA to aggressivelysupport proactive public involvement atall stages of planning and projectdevelopment. State departments oftransportation, metropolitan planningorganizations, and transportationproviders are required to develop, withthe public, effective involvementprocesses which are custom-tailored tolocal conditions. The performancestandards for these proactive publicinvolvement processes include earlyand continuous involvement; reasonablepublic availability of technical andother information; collaborative inputon alternatives, evaluation criteria, andmitigation needs; open public meetingswhere matters related to Federal-aidhighway and transit programs are beingconsidered; and open access to thedecisionmaking process prior to closure.

To achieve these objectives, theFHWA and FTA commit to:

1. Promoting an active role for thepublic in the development oftransportation plans, programs andprojects from the early stages of theplanning process through detailedproject development.

2. Promoting the shared obligation ofthe public and decisionmakers to definegoals and objectives for the State and/or metropolitan transportation system,to identify transportation and relatedproblems, to develop alternatives toaddress the problems, and to evaluatethe alternatives on the basis ofcollaboratively identified criteria.

3. Ensuring that the public is activelyinvolved in the development of publicinvolvement procedures in ways that go


beyond commenting on draftprocedures.

4. Strongly encouraging the Statedepartments of transportation,metropolitan planning organizations,and transportation providers toaggressively seek to identify and involvethe affected and interested public,including those traditionallyunderserved by existing transportationsystems and facilities.

5. Strongly encouraging planning andimplementing agencies to usecombinations of different publicinvolvement techniques designed tomeet the diverse needs of the broadpublic.

6. Sponsoring outreach, training andtechnical assistance, and providinginformation for Federal, State, regional,and local transportation agencies oneffective public involvementprocedures.

7. Ensuring that statewide andmetropolitan planning work programsprovide for effective publicinvolvement.

8. Carefully evaluating publicinvolvement processes and proceduresto assess their success at meeting theperformance requirements specified inthe appropriate regulations during ourjoint certification reviews, metropolitanplanning and conformity findings, StateTransportation Improvement Program(STIP) approvals and project oversight.Gordon J. Linton, Administrator,

Federal Transit AdministrationRodney E. Slater, Administrator, Federal

Highway Administration

FHWA/FTA Questions and Answers onPublic Involvement in TransportationDecisionmaking

This guidance responds to questionsraised during the eight regional FHWA/FTA outreach meetings on the planningregulations (23 CFR 450) as well as atother meetings where the planningregulations have been discussed.

1. Why are changes in publicinvolvement needed under theIntermodal Surface TransportationEfficiency Act of 1991 (ISTEA) andrelated policies and regulations?

Public involvement in transportationinvestment decisionmaking is central toaccomplishing the vision of the ISTEA.The legislation recognizes thattransportation investment decisionshave far-reaching effects and thus itrequires that metropolitan and statewidetransportation decisions consider a widearray of factors including land useimpacts and ‘‘the overall social,economic, energy, and environmentaleffects of transportation decisions’’ (23U.S.C. 134(f) and 135(c)). Many of thesefactors reflect community values and are

not easily quantifiable. Public input isessential in adequately consideringthem.

The legislation also recognizes thediversity of views on transportationproblems and investment options. TheISTEA states that, prior to adoptingplans or programs, the MPO or StateDOT ‘‘shall provide citizens, affectedpublic agencies, representatives oftransportation agency employees,private providers of transportation,other affected employee representatives,and other interested parties with areasonable opportunity to comment’’ (23U.S.C. 134 and 135). Federal DOT policyand FHWA and FTA regulations buildon these principles by requiring MPOsand State DOTs to establish their owncontinuing public involvementprocesses which actively seekinvolvement throughout transportationdecisionmaking, from the earliestplanning stages, including theidentification of the purpose and need,through the development of the range ofpotential solutions, up to and includingthe decision to implement specificsolutions. These regulations provide abasic set of performance standardsindicating what the FHWA and FTAexpect public involvement for plans,programs, major transportationinvestments, and transportation projectsto achieve. In sum, the ISTEA and itsimplementing regulations envision anopen decisionmaking process elicitingthe input and active involvement of allaffected individuals, groups, andcommunities, and addressing the fullrange of effects that the transportationinvestments may have on ourcommunities and our lives.

2. What are some of the keyconsiderations in planning for effectivepublic involvement?

An effective public involvementprocess provides for an open exchangeof information and ideas between thepublic and transportationdecisionmakers. The overall objective ofan area’s public involvement process isthat it be proactive, provide completeinformation, timely public notice, fullpublic access to key decisions, andopportunities for early and continuinginvolvement (23 CFR 450.212(a) and450.316(b)(1)). It also providesmechanisms for the agency or agenciesto solicit public comments and ideas,identify circumstances and impactswhich may not have been known oranticipated by public agencies, and, bydoing so, to build support among thepublic who are stakeholders intransportation investments whichimpact their communities.

Six useful key elements in planningfor effective public involvement are: (1)

Clearly-defined purpose and objectivesfor initiating a public dialogue ontransportation plans, programs, andprojects, (2) Identification of specificallywho the affected public and otherstakeholder groups are with respect tothe plan(s), program(s), and project(s)under development, (3) Identification oftechniques for engaging the public inthe process, (4) Notification procedureswhich effectively target affected groups,(5) Education and assistance techniqueswhich result in an accurate and fullpublic understanding of thetransportation problem, potentialsolutions, and obstacles andopportunities within various solutionsto the problem, and, (6) Follow throughby public agencies demonstrating thatdecisionmakers seriously consideredpublic input.

3. What are the indicators of aneffective public involvement process?

A good indicator of an effective publicinvolvement process is a well informedpublic which feels it has opportunitiesto contribute input into transportationdecisionmaking processes through abroad array of involvementopportunities at all stages ofdecisionmaking. In contrast, anineffective process is one that relies onone or two public meetings or hearingsto obtain input immediately prior todecisionmaking on developed draftplans and programs. Public meetingsthat are well attended, frequent newscoverage on transportation issues,public forums where a broadrepresentation of diverse interests is inattendance, and plans, TIPs, MISalternatives, and project designs whichreflect an understanding andconsideration of public input are allindicators that the public involvementprocess is effective.

4. When should an agency update itspublic involvement process?

The planning regulations do notspecify a schedule for updating publicinvolvement processes. Rather, anexisting process should be updatedwhenever conditions indicate that it isineffective. The enhanced focus onpublic involvement in the ISTEA andthe need for more proactive outreachthan has been the case in the past,however, necessitate an evolutionaryapproach. The public involvementprocess should be an integral part of anagency’s activities and its adequacyshould be explicitly considered eachtime an agency makes major programchanges, initiates new studies toidentify solutions to transportationproblems, and updates its plans.

5. How does the State DOT and/orMPO involve the public in developing orrevising the public involvement process?


Involving the public in thedevelopment or revision of publicinvolvement processes helps MPOs andState DOTs identify involvementapproaches that work. Techniques fordoing this include: distributing easilyunderstood materials explaining whythis involvement is important, holdingfocus groups on the transportationdecisionmaking process, brainstormingwith the public including members ofthe public who have not traditionallybeen involved in transportationdecisions, inviting the community toparticipate in presentations on theshort-term and long-term transportationchallenges the region or State faces, andmaking presentations to civicorganizations, senior citizens’ groups,minority groups, and other publicagencies who are stakeholders intransportation decisions (i.e., health andhuman services departments oreconomic development departments).

6. Is the State DOT or MPO requiredto have a 45-day public comment periodon revisions to its currently adoptedpublic involvement process?

Yes. The 45-day public commentperiod also applies to revisions to anadopted public involvement process.Processes adopted before November 23,1993, must be reviewed andappropriately updated so they areconsistent with the joint planningregulations. If the review finds that thepreviously adopted processes areconsistent with the regulations but havenot been subjected to the 45-daycomment period, the State DOT or MPOmust provide a 45-day comment period.

7. How do FHWA and FTA define the‘‘public’’?

The ISTEA specifically identifiesvarious segments of the public and thetransportation industry that must begiven the opportunity to participate,including ‘‘citizens, affected publicagencies, representatives oftransportation agency employees, otheraffected employee representatives,private providers of transportation andother interested parties’’ (e.g., 23 U.S.C.134(h)). The FHWA and FTA define thepublic broadly as including allindividuals or groups who arepotentially affected by transportationdecisions. This includes anyone whoresides in, has interest in, or doesbusiness in a given area which may beaffected by transportation decisions.The public includes both individualsand organized groups. In addition, it isimportant to provide similaropportunities for the participation of allprivate and public providers oftransportation services, including, butnot limited to, the trucking and railfreight industries, rail passenger

industry, taxi cab operators, and allconventional and unconventionaltransit service operators. Finally, thosepersons traditionally underserved byexisting transportation systems such aslow income or minority households andthe elderly should be explicitlyencouraged to participate in the publicinvolvement process.

8. How should an agency identify andaddress the transportation needs ofpersons and groups who have beentraditionally underserved by existingtransportation systems?

This presents a formidable challengeto transportation agencies because theseindividuals and groups often do nothave the resources to travel to meetings,an ability to participate in meetingsscheduled during their work hours, oran understanding of how or why to getinvolved in the transportationdecisionmaking process.

The identification of these groups andindividuals also presents a challenge.Transportation agencies should begin byidentifying organized groups includingpersons with disabilities, minoritycommunity groups, ethnic groups andorganizations, and Native Americans.Executive Order 12898, ‘‘FederalActions to Address EnvironmentalJustice in Minority Populations andLow-Income Populations’’ directsFederal agencies to conduct existingprograms so as to identify and addressdisproportionately high and adverseenvironmental effects on minority, lowincome, and Native Americancommunities. Techniques and strategiesto identify the transportationunderserved include: notices in non-English language newspapers; publicservice announcements on radiostations which tailor their programmingto non-English speaking Americans; andfliers and notices on public involvementopportunities distributed to seniorcitizens’ centers, minorityneighborhoods, urban housing projects.

Addressing the needs of these groupswill require gaining a thoroughunderstanding both of why they havebeen traditionally underserved and ofwhat their current and futuretransportation needs are. Continuousinteraction between these groups andtransportation professionals will becritical to better serving their needs inthe future.

9. Who are the public and privateproviders and users of unconventionaltransportation services and how shouldthey be included in the publicinvolvement process?

Unconventional mass transportationservices include school buses;transportation for the elderly, personswith disabilities, and children in Head

Start; and other non-fixed route orunscheduled transportation. Both usersand providers are members of thegeneral public. Users of theseunconventional transportation servicestend to be underserved by themainstream transportation system, andshould be treated as such by the publicinvolvement process. Traditionally,providers of unconventionaltransportation are social serviceagencies providing specialized,dedicated transit services (e.g., vans orbuses) to fill gaps in the mobility needsof participants in certain public andprivate programs. These providersshould be approached similarly to otherpublic agencies. Their input should besought out on effective ways to addresstransportation problems because theyhave experience in serving many of thetraditionally underserved whichtraditional transportation agencies maynot have. Other public and privatetransportation providers, which may ormay not be considered to be‘‘conventional,’’ similarly need to beactively involved in MPO and Statetransportation decisionmaking. Thesemay include trucking and rail freightcarriers, representatives oftransportation employees, andrepresentatives of ports and airports.The creation of special committees oradvisory groups may provide anorganized structure to receive the inputof transportation industry groups on anongoing basis.

10. How do the public involvementrequirements for project developmentand the NEPA process apply to publicinvolvement for major transportationinvestment studies (MIS)?

An MPO’s overall public involvementprocess should describe the approach tobe used to involve the public in any MISconducted in that metropolitanplanning area, regardless of whether thelead agency for the MIS is the MPOitself, the State DOT, or the transitoperator. At the start of the interagencyconsultation, the cooperating agenciesneed to tailor a specific publicinvolvement strategy for the MIS. Thestrategy should engage the public in theconsideration of the purpose and needfor a major investment as well as in thedevelopment and evaluation of allalternatives. If the MIS incorporatesdevelopment of a NEPA document, thepublic involvement strategy mustcomply with the public involvementprovisions of 23 CFR Part 771 or 40 CFRPart 622.

11. With respect to Federal LandsAgency projects (especially IndianReservation Roads projects), how canthe State DOT and MPO ensure thatpublic involvement has taken place


within the planning process in the STIP/TIP?

First, it is necessary for the State andMPO to provide for active involvementby the Federal Lands Agencies andIndian tribal governments in statewideor metropolitan transportation planningand programming. Such involvementallows all participants to coordinateplans and programs of projects underconsideration by the variousimplementing agencies. However, whenplanning for the involvement of Indiantribal governments, it is important foragency staff to recognize and besensitive to tribal customs and to thenationally recognized sovereignty oftribal governments. As a result, tribalgovernments should be actively soughtfor participation in the development ofmetropolitan and State plans andprograms as independent governmentbodies rather than as specific minoritygroups.

Second, each of the Federal LandsAgencies has its own procedures fortransportation planning that complywith guidance from the FHWA’s FederalLands Highway Office whichadministers the Federal Lands HighwayProgram. Public involvement may notalways occur during the development oftransportation improvement programsfor each Federal Lands Agency or Indiantribe. Therefore, while metropolitan areapublic involvement on the metropolitanTIP can serve as a surrogate for publicinvolvement on the STIP for that area,no such assumption can be made for aFederal Lands Agency or tribal TIP.Because the Federal Lands Agency ortribal public involvement process maynot satisfy the State DOT or MPO publicinvolvement process for transportationplanning, the State DOT and MPO mustdetermine whether other publicinvolvement measures are needed.

Third, the State and MPO (withFHWA and FTA field offices, asappropriate) should work proactivelywith the Federal Lands Agencies andIndian Tribal Governments to gain anunderstanding of procedures regardingdevelopment of each agency’s TIP.These procedures may varyconsiderably from agency to agency.Areas to examine include the schedulefor TIP development; the format of theTIP; and plans for meeting with variousgroups, members of the public, andTribal Governments during TIPdevelopment.

12. Does reasonable public access totechnical and policy informationinclude access to technical assumptionsunderlying the planning and emissionsmodels used in carrying outtransportation decisionmaking and airquality conformity determinations?

Yes. Under the ISTEA and relatedregulations, the public must havereasonable access to technicalassumptions and specifications used inplanning and emissions models. Thisincludes access to input assumptionssuch as population projections, land useprojections, fares, tolls, levels of service,the structure and specifications of traveldemand and other evaluation tools. Tothe maximum extent possible, alltechnical information should be madeavailable in formats which are easilyaccessible and understandable by thegeneral public.

Special requests for raw data, data inspecific formats, or requests for otherinformation must be considered interms of their reasonableness withrespect to preparation time and costs.Public involvement procedures shouldinclude parameters for determiningreasonableness. In order to facilitatepublic involvement yet conserve limitedstaff resources, State DOTs and MPOsshould consider making informationavailable to interested parties on aregular basis through communicationtools such as: reports, electronic bulletinboards, computer disks, datacompilations, briefings, question andanswer sessions, and telephonehotlines. Reports or other writtendocuments should be easily accessibleto the public in public libraries,educational institutions, governmentoffices, or other places and at timesconvenient to the public.

When the public agency receives arequest to perform an analysis that ithad not considered, the State DOT orMPO needs to make a determination asto the reasonableness of the request. Ifthe State DOT or MPO decides toperform the analysis, it should make allrelevant information available to allinterested parties. If it decides not toinclude the analysis as part of itstransportation decisionmaking, itshould respond to the request byindicating why it decided not to do so.The early involvement of interestedparties in the analytical process canfacilitate early agreement on the scopeand range of analyses to be conductedby the public agency.

When agency staff conducts analysesthat are not required for thetransportation planning process and onwhich non-Federal funds are used, theagency is not obligated to make suchinformation available. State DOTs andMPOs are encouraged to make suchinformation available, given the premisethat transportation decisionmaking is anopen process. Similarly, State DOTs andMPOs should review State and localregulations which may mandate that

such information be made available tothe public.

13. How can State DOTs and MPOsdemonstrate ‘‘explicit consideration andresponse to public input,’’ as requiredby 23 CFR 450.212 and 23 CFR 450.316?

State DOTs and MPOs shouldincorporate input from the public intodecisionmaking, when warranted, withthe understanding that not all partieswill get exactly what they want.However, the public must receiveassurance that its input is valued andconsidered in decisionmaking so that itfeels that the time and energy expendedin getting involved is meaningful andworthwhile. To do this, State DOTs andMPOs should both maintain records ofpublic involvement activities, input,comments, and concerns as well asdocument requests for information andresponses to input received during thepublic involvement process. Agenciescan keep records and provide feedbackin a variety of ways. Techniques forproviding feedback include: regularlypublished newsletters, special insertsinto general circulation newspapers,radio programs, telephone hotlines withproject updates, public access televisionprograms, and reports or publicationsdescribing how projects or programs areprogressing.

Under the Environmental ProtectionAgency’s transportation conformityregulations (40 CFR 51), when an MPOreceives significant comments on ametropolitan transportation plan or TIPfrom the public or through theinteragency consultation process, itmust provide a summary, analysis, andreport on how the comments wereresponded to as part of the finalmetropolitan transportation plan andTIP.

14. What types of revisions to plans,TIPs, and STIPs do not requireadditional opportunity for publiccomment and/or publication under 23CFR 450.316(b)(viii) and 23 CFR450.212(d)?

Minor changes in plans, TIPs, andSTIPs generally can be made after theMPO or State DOT has completed itspublic comment process without furtheropportunities for public involvement.Examples may include: minor changesin project scope or costs, and movingminor or non-controversial projectsamong the first 3 years of the TIP/STIP.However, MPOs and State DOTs shouldidentify what are to be considered asminor changes, with the public, duringthe development of the publicinvolvement process. What may appearto be minor to the public agency maynot be considered minor to the public.This gives the public the chance toprovide input on these definitions and


for a common understanding on thepublic involvement procedures to beused to deal with specific types ofchanges to TIPs and STIPs.

(23 U.S.C. 109(h), 128, and 315; 49 CFR 1.48;sections 1024, 1025, and 3012, Pub. L. 102–240, 105 Stat. 1914)

Issued on: January 19, 1995.Rodney E. Slater,Federal Highway Adminstration.Gordon J. Linton,Federal Transit Administration.[FR Doc. 95–2063 Filed 1–26–95; 8:45 am]BILLING CODE 4910–22–P

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Part IV

Department ofAgricultureFood and Consumer Service

7 CFR Parts 210 and 220National School Lunch Program andSchool Breakfast Program: ComplianceWith the Dietary Guidelines forAmericans and Food-Based MenuSystems; Proposed Rule and Notice ofPublic Meeting



Food and Consumer Service

7 CFR Parts 210 and 220

RIN 0584–AB94

National School Lunch Program andSchool Breakfast Program:Compliance With the DietaryGuidelines for Americans and Food-Based Menu Systems

AGENCY: Food and Consumer Service,USDA.ACTIONS: Proposed rule.

SUMMARY: The Healthy Meals forHealthy Americans Act of 1994 requires,for purposes of the National SchoolLunch and School Breakfast Programs,that a variety of meal planningapproaches be made available to schoolfood authorities, including ‘‘food-basedmenu systems.’’ The food-based menusystems concept is intended tosupplement the nutrient-based menuplanning provisions previouslyproposed by the Department ofAgriculture on June 10, 1994. Inaddition, the Act requires that schoolmeals comply with the DietaryGuidelines for Americans, as theDepartment also proposed on that date.The proposal which follows implementsthe requirement for a food-based menusystems planning alternative. To ensurecompliance with the requirements of theDietary Guidelines, this proposalexpands the monitoring procedures inthe earlier proposal to provide a systemappropriate for monitoring meals servedby school food authorities that choosethe food-based menu systems approach.DATES: To be assured of consideration,comments must be postmarked ortransmitted on or before March 13,1995.ADDRESSES: Mr. Robert M. Eadie, Chief,Policy and Program DevelopmentBranch, Child Nutrition Division, Foodand Consumer Service, USDA, 3101Park Center Drive, Alexandria, Virginia22302. Comments may be sent via E-mail to: [email protected]. Ifcomments are sent electronically,commenters should designate ‘‘receiptrequested’’ to be notified by E-mail thatthe message has been received byUSDA.FOR FURTHER INFORMATION CONTACT:Robert M. Eadie at the above address orby telephone at 703–305–2620.


Executive Order 12866

This proposed rule has beendetermined to be significant and was

reviewed by the Office of Managementand Budget under Executive Order12866.

Regulatory Flexibility ActThis proposed rule has been reviewed

with regard to the requirements of theRegulatory Flexibility Act (5 U.S.C. 601through 612). The Administrator of theFood and Consumer Service (FCS) hascertified that this rule will not have asignificant economic impact on asubstantial number of small entitiesbecause of the variety of optionsavailable to schools to comply with theproposed requirements. The impacts ofspecific provisions have beenconsidered by the Department as part ofthe required Regulatory Assessment.Interested parties should refer to thisdocument which is published at the endof this proposal.

Catalog of Federal AssistanceThe National School Lunch Program

and the School Breakfast Program arelisted in the Catalog of Federal DomesticAssistance under Nos. 10.555 and10.553, respectively, and are subject tothe provisions of Executive Order12372, which requiresintergovernmental consultation withState and local officials. (7 CFR Part3015, Subpart V and final rule-relatednotice at 48 FR 29112, June 24, 1983.)

Executive Order 12778This proposed rule has been reviewed

under Executive Order 12778, CivilJustice Reform. This proposed rule isintended to have preemptive effect withrespect to any State or local laws,regulations or policies which conflictwith its provisions or which wouldotherwise impede its fullimplementation. This proposed rule isnot intended to have retroactive effectunless so specified in the Effective Datesection of this preamble. Prior to anyjudicial challenge to the provisions ofthis proposed rule or the application ofthe provisions, all applicableadministrative procedures must beexhausted. In the National SchoolLunch Program and School BreakfastProgram, the administrative proceduresare set forth under the followingregulations: (1) school food authorityappeals of State agency findings as aresult of an administrative review mustfollow State agency hearing proceduresas established pursuant to 7 CFR210.18(q); (2) school food authorityappeals of FCS findings as a result of anadministrative review must follow FCShearing procedures as establishedpursuant to 7 CFR 210.30(d)(3); and (3)State agency appeals of StateAdministrative Expense fund sanctions

(7 CFR 235.11(b)) must follow the FCSAdministrative Review Process asestablished pursuant to 7 CFR 235.11(f).

Information CollectionThis proposed rule contains no new

information collection requirementswhich are subject to review by theOffice of Management and Budget(OMB) under the Paperwork ReductionAct of 1980 (44 U.S.C. Chapter 35).

BackgroundSection 106(b) of Pub. L. 103–448, the

Healthy Meals for Healthy AmericansAct of 1994, signed into law onNovember 2, 1994, amended section 9 ofthe National School Lunch Act (NSLA),42 U.S.C. 1758(b)(2)(C), to require mealsthat are served under the NationalSchool Lunch Program (NSLP) andSchool Breakfast Program (SBP) meetthe Dietary Guidelines for Americans byJuly 1, 1996, unless the State agencygrants a waiver under criteriaestablished by the State agency. Section106(b) provides that a State agencywaiver cannot delay compliance withthe Dietary Guidelines beyond July 1,1998. Further, section 112(c) of Pub. L.103–448 amended section 12(k) of theNSLA, 42 U.S.C. 1760(k), to require thatthe Department develop ‘‘food-based’’systems for school food authorities tofollow when planning and preparingmeals. Food-based menu planningsystems would provide local foodservices with a third option,supplementing the Nutrient StandardMenu Planning (NuMenus) and AssistedNutrient Standard Menu Planning(Assisted NuMenus) systems originallyincluded in the Department’s June 10,1994, proposal. This proposedrulemaking would implement thesestatutory provisions. Other provisions ofPub. L. 103–448 will be incorporatedinto later rulemakings, as appropriate.One such provision requires disclosureof information about the nutritionalcontent of school meals and theconsistency of the meals with theDietary Guidelines. The Departmentwill consider a number of options forimplementing this provision. Ofparamount concern is the developmentof an approach that provides flexibilityand alternatives for school foodauthorities. In addition, the Departmentwants to ensure that any recordkeepingor reporting requirements that areassociated with the requirement fornutrition disclosure are kept to aminimum.

Current ProvisionsThe NSLP was designed in 1946 to

offer meals that provide foods which,over time, are sufficient to approximate


one-third of the National Academy ofSciences’ Recommended DietaryAllowances (RDA) for key nutrientsneeded for growth and development forthe 10–12 year old child. Historically,the Department has attempted toachieve this goal by requiring thatschool lunches contain minimumamounts of the following specificcomponents: meat/meat alternate,breads/bread alternates, two differentvegetables/fruits and fluid milk. Thepattern for the SBP has the goal ofproviding 25 percent of the RDA andrequires minimum quantities of thefollowing components: two servings ofany combination of meat/meat alternateor breads/bread alternates, one servingof fruits or vegetables and fluid milk.

Proposed Updating of the NutritionStandards

Overall, these meal patterns succeedin providing adequate levels of keynutrients. However, they were neverupdated to reflect the broad array ofscientific data documenting thatexcesses in consumption are a majorconcern because of their relationship tothe incidence of chronic disease.Consequently, school lunches typicallyfail to comply with the DietaryGuidelines for Americans, publishedjointly by the Department of Agricultureand the Department of Health andHuman Services. In particular, schoollunches fail to meet the DietaryGuidelines recommended limits onpercent of calories from fat (30%) andsaturated fat (10%).

To address these deficiencies, theDepartment issued a proposedregulation on June 10, 1994, updatingthe nutrition standards of the NSLP andSBP and requiring that school mealscomply with the recommendations ofthe Dietary Guidelines no later than July1, 1998. Recognizing that the mealpattern did not provide sufficientflexibility to enable a school foodservice to comply with theserequirements, that proposal alsoproposed to replace the current mealpatterns with NuMenus and AssistedNuMenus so that meals could beevaluated and adjusted routinelythrough use of nutrition analysis.Finally, realizing the need for oversightand technical assistance, theDepartment proposed an appropriatesystem for State agency monitoring ofschool food authority compliance withthe nutrition standards.

The Department received over 14,000comment letters in response to the June10, 1994, rulemaking. Over 5,000commenters, primarily from persons inthe school food service community,recommended that a meal pattern be

retained and that it be designed to meetthe requirements of the DietaryGuidelines. A number of commentersrecommended systems currently in usein their areas, such as the MinnesotaLunch Power program or the CaliforniaSHAPE program. Many commentersindicated that development of a newmeal pattern based on the DietaryGuidelines would result in speedierimplementation of the updated nutritionstandards because meal planners werefamiliar with the meal pattern concept.

On November 2, 1994, Pub. L. 103–448, the Healthy Meals for HealthyAmericans Act of 1994, was signed intolaw. This law had no provisions thatwould require changes to the June 10,1994, proposal other than to mandateimplementation of the DietaryGuidelines two years earlier than hadbeen proposed and to require that food-based menu planning systems bepermitted as means to try to conformmeals to the Dietary Guidelines. Theproposed provisions involvingNuMenus and Assisted NuMenus aswell as the proposed nutrition standardsfor school meals, including compliancewith the applicable Dietary Guidelines,were not affected. The Departmentconsiders, therefore, that the June 10,1994, proposal is consistent withCongressional intent on the issuesaddressed in that rule.

The Department wishes to callattention to the fact that certainprovisions included in the June 10,1994, proposal will be discussed in thispreamble to facilitate public review andcomment on food-based menu systemswithin the overall context of theDepartment’s School Meals Initiative forHealthy Children. These provisionssuch as NuMenus and AssistedNuMenus are not, however, beingreproposed, and the Department willnot consider additional comments onany provisions of the June 10, 1994,proposed rule. The Department willissue a final rule incorporatingprovisions from that proposal and thisone, and at that time the Departmentwill address the comments received onboth proposals.

Meeting the Dietary Guidelines, RDAand Energy Levels

As originally proposed by theDepartment and now required bysection 9(f)(2)(C) of the NSLA, allreimbursable school meals, regardless ofthe method used to plan those meals,will be required to meet the applicablerecommendations of the DietaryGuidelines including the quantifiedstandards established for fat andsaturated fat over the course of a schoolweek.

To summarize the earlier proposals,located at 59 FR 30234–37, school foodauthorities would be required to makean effort to reduce sodium andcholesterol, increase dietary fiber, andserve a variety of foods. However, theDepartment did not propose specificlevels for these components, sincenumeric targets are not established bythe current Dietary Guidelines.Nevertheless, progress in these areas isexpected and would be assessed. TheRDA for the following nutrients wereproposed at minimum levels: protein,vitamin A, vitamin C, iron, and calciumas well as the recommended energyintake for the specific age/grade. It wasalso proposed that energy levels(calories) would be established toprovide, over the school week, anaverage of one-third of the RDA for theNSLP and one-fourth for the SBP andthe maximum levels of calories from fatand saturated fat would be limited to 30percent and 10 percent of calories,respectively.

Food-Based Menu SystemsIn developing the proposed food-

based menu planning systems, theDepartment retained the structure of thecurrent meal patterns for the NSLP andSBP in terms of components. However,the Department could not retain thecurrent quantity requirements, becausethey are inadequate to meet the goal ofcompliance with the Dietary Guidelines.Consequently, portion sizes for somecomponents have been realigned toplace greater emphasis on providingvegetables/fruits and grains. In addition,the ways grains/breads products maycontribute to the reimbursable mealwould be expanded.

The Department has revised thecurrent meal pattern to better reflect therecommendations of the DietaryGuidelines. However, in the absence ofongoing nutrient analysis, there can beno absolute assurance that simpleadherence to a meal pattern will resultin meals that comply with thesenutrition standards. Because of the vastdifferences in the nutrient value ofvarious food items, especially givendifferent cooking methods, mealplanners must keep in mind the need tomodify menus, recipes, productspecifications, and preparationtechniques. However, the Departmentrecognizes that there may be some mealplanning approaches that are designedto reflect the recommendations of theDietary Guidelines. As discussed laterin this preamble, the Department mayallow such meal planning approaches asone way of demonstrating compliancewith the applicable Dietary Guidelinesand proposed nutrition standards


without requiring the State agency toconduct nutrient analysis as part of itsoversight responsibilities.

In designing the proposed changes,the Department employed a method thatis consistent with that used to developprevious meal patterns and other foodguides. Nutrient profiles weredeveloped for each of the four foodcomponents. Then, using foodconsumption data from the SchoolNutrition Dietary Assessment (SNDA)Study (released in October, 1993), theDepartment estimated the type andfrequency of foods consumed from eachof the food components. With thisinformation, the Department arrived atcomposites of estimated nutrient andcaloric contributions of each componentand calculated revised quantities foreach component to achieve compliancewith the nutrition standards for eachage/grade group. (These groupings arediscussed later in this preamble.)

For developmental purposes, thenutrient profiles for each mealcomponent were calculated based ontheir lowest fat forms and on theassumption that they contained noadded sugars. The profiles alsomaintained the approximate proportionsof the main ingredients which,according to SNDA, were used to satisfyeach component. For example, in themeat/meat alternate component, theapproximate relative proportions ofmeat, eggs, beans, and cheese weremaintained. After establishing that thevitamin, mineral and protein needswere met for each age/grade grouping,the Department determined the calorielevels of each food component andcalculated the difference between theselevels and the calorie needs of each age/grade group.

Data from SNDA demonstrates thattypical school meals alreadysubstantially exceed the target forprotein. There would be little benefit,therefore, to raising calorie levels byincreasing the size of the meat/meatalternate or milk components. Instead,the additional calories needed to makeup the difference between the calorielevels of the lowest-fat versions of themeal components and the requiredcalorie levels should come fromcarbohydrates and by using meat/meatalternate and milk that are somewhathigher in fat than the low-fat productsused in the model. Moreover, theDepartment’s analysis shows thatnutrition standards can be met whileusing a variety of items within eachcomponent while still remaining withinthe Dietary Guidelines’recommendations for limiting caloriesfrom total fat to 30 percent and to 10

percent for saturated fat and attainingthe RDA for specific nutrients.

For many schools, supplying one-third of the recommended energyallowance (calories) through lunchesthat provide no more than 30 percent ofcalories from total fat and 10 percentfrom saturated fat will requirereplacement of calories from fat withcalories from other sources. Fat yieldsnine calories of food energy per gram,more than twice the food energy pergram provided by carbohydrates andprotein, which each yield four caloriesper gram. The Menu ModificationDemonstration Projects, conducted bythe Department in 1990–92, showed thata common shortcoming in efforts toprovide meals with a lower percent ofcalories from fat is the failure tomaintain total calories (Fox and St.Pierre, 1993). In this demonstrationproject, where Federal technicalassistance was minimal, three of thefour NSLP demonstration sitessubstantially reduced total fat, but didnot replace the lost calories. As a result,they failed to achieve their target goalsfor percent of calories from fat for theNSLP meal, and they fell short ofproviding one-third of the RDA for foodenergy. It is therefore appropriate forfood-based menu systems to includeincreased servings for food componentswhich can provide additional caloriesfrom sources other than fat whilecalories from fat are being reduced.(REFERENCE: Fox, M.K., and R. St.Pierre (1993). Menu ModificationDemonstration Grants: EvaluationResults, Volume 1: Summary. Preparedby Abt Associates, Inc, under contract tothe Department of Agriculture, Foodand Nutrition Service.)

Age/Grade Groups for NutritionStandards

The Department proposes to use age/grade groupings of kindergarten throughgrade 6 and grades 7 through 12 with anoptional grouping for kindergartenthrough grade 3. The two requiredgroups are designed to reflect the gradestructures of the majority of schools.But, as some schools enroll children inkindergarten through grade 3, anoptional standard is also proposed.

Establishing separate standards andmeal patterns for younger versus olderchildren recognizes the need to provideadequate energy and nutrients forgrowth based on their particular needs.Growth and maturation changes inadolescents require higher nutrient andenergy levels than those for youngerchildren. Nutrient and calorie levelsdesigned for younger children areinappropriate for adolescents, as theyfail to provide sufficient energy for

adolescents, especially for boys, as wellas sufficient iron for adolescent females.A single nutrient standard that meetsthe needs of the adolescent will providetoo many calories and too much fat forthe younger child promoting either platewaste or excessive intake. In developingthe calorie levels, the Department wasalso mindful of the need to balance thereduction in energy from calories fromfat and saturated fat as advised by theDietary Guidelines, with the need tomaintain energy levels overall. Energylost from reduced fat meals must bereplaced by energy from carbohydrates.

To establish these levels, a tableentitled ‘‘Calorie and Nutrient Levels forSchool Lunch’’ would be included at§ 210.10(c)(2) and one entitled ‘‘Calorieand Nutrient Levels for SchoolBreakfast’’ in § 220.8(a)(2). As discussedfurther, tables for the minimumquantities of the required foodcomponents are also proposed.

Changes to the NSLP Meal ComponentsThe following are the specific changes

the Department is proposing to thecurrent meal pattern components. TheDepartment wishes to emphasize thatthe principal differences between theproposed meal patterns and the currentpatterns reflect increases in thequantities of vegetables/fruits andbreads/grains products. The Departmentis proposing no reductions to thecurrent minimum quantity requirementsfor any components.

Meat/Meat Alternate ComponentThe Department is not proposing to

change the minimum amounts of thiscomponent required for children in anyage group. Nor are any changes beingmade to what constitutes the meat/meatalternate component. However,consistent with the Food GuidePyramid, guidance materials issued bythe Department in support of food-basedmenu planning systems will emphasizelower fat meat/meat alternates.

Vegetables/FruitsThe Department is proposing to

increase the amount of fruits andvegetables made available over thecourse of a week. The DietaryGuidelines and the Department’s FoodPyramid recommend a diet with avariety of vegetables, fruits and grainproducts. Moreover, the Departmentrecognizes that fiber levels should beincreased and calories from non-proteinsources must be provided to replacethose lost from the reduction in fat. TheDepartment is proposing that theminimum servings for the vegetables/fruits component would be three-fourthsof a cup (currently one-half cup for


children in kindergarten through grade3 and three-fourths cup for grades 4–12)per lunch plus an additional one-halfcup served over a five-day period forchildren in kindergarten through grade6. Allowing a five-day period to servethe additional one-half cup providesschools with flexibility in mealplanning. Because older children havegreater need for calories and othernutrients, the proposed rule wouldincrease the minimum serving forvegetables/fruits for children in grades 7through 12 from three-fourths of a cupper day to one cup per day. No changesare being proposed, however, for theportion sizes for very young andpreschool children nor are changesmade to what constitutes thiscomponent. The Department isproposing to revise the chart,‘‘Minimum Quantities’’ in § 210.10(c) aswell as the additional discussion aboutthis component in § 210.10(d)(3) toreflect the enhanced portion sizes.

Grains/BreadsAs with the fruits/vegetables

component, the Department isproposing a significant increase in theamount of grains/breads made availableduring a school week. Both the DietaryGuidelines and the Department’s FoodPyramid place emphasis on theconsumption of grains. In keeping withthe use of the term ‘‘grains’’ in theDietary Guidelines, this proposal wouldamend the chart, ‘‘MinimumQuantities’’ in § 210.10(c) and theadditional discussion about thiscomponent in § 210.10(d)(4) to renamethe component currently titled ‘‘Bread/Bread Alternate.’’ The new title wouldbe ‘‘Grains/Breads.’’ In addition, theDepartment is proposing an increase inthe number of servings of grains andbreads for school children to augmentdietary fiber and to provide anadditional low-fat source of calories tobalance the loss of calories from fat.Again, it should be noted that theservings for very young and preschoolchildren have not been changed.However, for children in kindergartenthrough grade 6, the number of servingsper week of grains and breads would beincreased from 8 to 12. For children ingrades 7 through 12, the number ofservings would be increased from 10 to15 servings per week. The Department isalso proposing to revise§ 210.10(d)(4)(ii) to permit one servingper day of grains/breads in the form ofa dessert. This proposed change isdesigned to provide flexibility to assistmenu planners in meeting energy needs.

Current guidance (FNS Instruction783–12), issued in 1983, established therequirements and the minimum weights

for the current breads/bread alternatescomponent. The Department plans toreissue this Instruction when finalregulations are published to revise thecriteria for determining acceptablegrains/breads products so that someadditional items may be credited to thisgroup. However, no changes are beingmade in the regulations regarding whatconstitutes this component.

Milk

As with the meat/meat alternatecomponent, this proposal does notchange the current minimum servingsizes for fluid milk for any of the age/grade groups. Readers should note thatsection 107 of Pub. L. 103–448 includeda provision modifying the requirementthat fluid whole milk and fluidunflavored low-fat milk be offered aspart of all reimbursable lunches. Thenew statutory milk requirement atsection 9(a)(2) of the NSLA, 42 USC1758(a)(2), will be addressed in aseparate rulemaking.

School Lunch Component Chart

To reflect these proposed changes tothe school lunch pattern, the proposedrule would make a number of revisionsto the table entitled ‘‘School LunchPattern-Per Lunch Minimums’’ in§ 210.10(c). First, the title of the chartwould be renamed ‘‘MinimumQuantities,’’ since some of the quantityrequirements are cumulative over thecourse of the school week. Secondly, theage/grade groups are the same asdiscussed above for the nutritionstandards, except that the minimumportions for children ages one to twowho may participate are included foreasy reference. (Readers should notethat these minimums are the same asthose now in use.) Furthermore, school-age children have been separated intotwo groups: (a) kindergarten throughgrade 6 and (b) grades 7 through 12.School food authorities also have theoption of using alternate portion sizesestablished for children in kindergartenthrough grade 3. Readers should note,however, that the currentrecommendation to provide children ingrades 7 through 12 with three ouncesof meat/meat alternate would bedeleted. This revision is intended toensure that the chart reflects only theproposed regulatory revisions. It has noeffect on the minimum portions thatschools must offer. In addition, the charthas been revised to incorporate theproposed increases in the minimumportions of fruits and vegetables and thenumber of servings of grains/breads.

Changes to the School BreakfastProgram

In the June 10, 1994, rulemaking, theDepartment also proposed to amend thenutrition requirements for the SBP. Asunder the NSLP, the SBP would berequired to comply with the DietaryGuidelines and with the RDA andcalories levels adjusted appropriately.Breakfasts would be required to meetone-fourth of the RDA (consistent withthe current design of the breakfast mealpattern) and would have to providefewer calories than lunches. The currentage/grade group for breakfast is retainedbecause of its familiarity. Again, onlythe chart reflecting the RDA and calorielevels for the SBP is proposed herein.The chart ‘‘Calorie and Nutrient Levelsfor School Breakfasts’’ is contained in§ 220.8(a)(2).

Changes to the SBP Meal Components

As with the proposed school lunchpattern, the Department is not proposingto reduce the portion size for any of thecomponents of school breakfasts. Thefollowing are the specific changes theDepartment is proposing to the currentmeal pattern components for schoolbreakfasts:

Meat/Meat Alternate or Grains/Breads(the New Name for Bread/BreadAlternate)

The current requirement for twoservings of meat/meat alternate or twoservings of grains/breads or one servingof each remains the same. However,school food authorities are encouragedto offer children in grades 7 through 12an additional serving of the grains/breads component per day. Thisoptional increase in the number ofservings is intended to providesufficient calories to meet the needs ofthe adolescent child, especiallyadolescent males, when the fat contentof the breakfast is modified to beconsistent with the Dietary Guidelines.To this end, the Department emphasizesthat meeting the nutrient requirementsof the grades 7 through 12 with thesingle pattern for kindergarten throughgrade 12 will be difficult. It is importantthat school food authorities recognizethis and make an effort to offer highcalorie, nutrient dense foods in thebreakfast menu.

Vegetables/Fruits

There are no proposed changes in theminimum portions currently requiredfor children in any age group.

Milk

There are no proposed changes in therequirements for the amount of fluid


milk that is served either as a beverageor on cereal.

School Breakfast Component ChartThe table entitled ‘‘School Breakfast

Pattern-Per Breakfast Minimums’’currently in § 220.8(a) would beamended to reflect the above proposedrevisions. As with the NSLP, no changesare being proposed to the minimumquantities for infants and youngchildren and the title has been changedto ‘‘Minimum Quantities’’ to beconsistent with the corresponding chartfor the NSLP.

Compliance MonitoringThe Department proposes to monitor

compliance with the nutritionalstandards of the food-based menusystems in a manner consistent with thecompliance process proposed forNuMenus, Assisted NuMenus and withthe current regulations. Compliancewith meal components and quantitieson a per-meal basis for the food-basedmenu systems remain unchanged. Therequirements in § 210.18(g)(2) forPerformance Standard 2 under theadministrative review system wouldcontinue to apply to those reviewelements; i.e., on the day of a review,the lunch service must be observed toensure that all required mealcomponents are offered and thatchildren accept the minimum number ofitems stipulated both under thestandard meal service and the offerversus serve option.

The requirement that program mealsmeet all nutrition standards, includingthe Dietary Guidelines, necessitates anadditional review methodology for Stateagencies. While the compliance methodfor NuMenus and Assisted NuMenuswas addressed in the June 10, 1994,rulemaking, this proposal addresseshow this same basic compliance methodwould apply to food-based menusystems. Since, by law, these schoolsmay not be required to conduct theirown nutrient analysis, State agencieswill not have nutrient analysis recordsto review to verify that the meals offeredactually met the nutrition standards.Therefore, the Department is proposingto amend § 210.19, General Areas, torequire that State agencies conduct anutrient analysis of one week’s mealsusing the school’s production records.

This proposal would also authorizethe Department to approve alternativemethodologies proposed by the States ifthey provide the same degree ofassurance that school meals are incompliance with all nutrition standards.The proposed provision on monitoringis consistent with a statement from theCommittees’ Analysis accompanying S.

1614 that ‘‘. . . nutrient analysis maybe used by schools, State agencies or theSecretary as part of audit andcompliance activities.’’

In order to provide maximumflexibility for States to use an alternativemethodology to nutrient analysis as partof an administrative review, theDepartment will review any approachesproposed by State agencies or by schoolfood authorities with the approval oftheir State agency to meet both theapplicable Dietary Guidelines and thestandards for calories and nutrients asdetailed in the June 10, 1995, proposedrule at 59 FR 30234–5 and 59 FR 30239–40, for the NSLP and SBP, respectively.If the school food authority has used anapproved alternative to the food-basedmenu systems option and has preciselyfollowed it to meet the DietaryGuidelines and nutrition standards, theState agency would not be required toconduct a separate nutrient analysis.

The Department solicits comments onalternative methodologies that wouldsupport the production of meals thatadhere to the Dietary Guidelines. TheDepartment is particularly interested inmethodologies that are easilyimplemented and could be shared withother States and is prepared to facilitatethe sharing of information on suchmethodologies among States and schoolfood authorities.

As part of its on-going efforts toimplement the Dietary Guidelines, theDepartment has been in contact withState agencies to determine theirtraining and technical assistance needs.As a result of information obtained fromState agencies, a plan is beingdeveloped to provide a variety ofresources in the areas of trainingmodules and materials, recipes, productspecifications, menu planning guides,videos and workshops in ways that arecompatible with existing State trainingprocedures. In addition, the Departmentwill be soliciting applications for grantstotalling approximately $4,400,000 tofund State-level activities. TheDepartment is again requesting Stateand local administrators to comment onwhat types of training and technicalassistance are needed to best implementthis proposed rule.

Compliance reviews would beconducted on the meals offered by theschool food authority and/or the schoolsselected for review, depending on thelevel at which menus are planned andmeals provided. For example, if a schoolfood authority provides meals fromsatellite kitchens to schools, the Stateagency would use information from theproduction records at those kitchens toprepare the nutrient analysis. However,if an individual school with its own

menu planning and food productionwas selected for review, the Stateagency would use production recordsfrom that school’s kitchen for nutrientanalysis.

The State agency’s nutrient analysiswould be conducted using the samerequirements and methodologyemployed by school food authoritieschoosing to use NuMenus or AssistedNuMenus. The Department proposedcriteria for menu analysis in the June 10,1994 proposed rule and is currentlyconsidering comments on thoseprovisions for future adoption as a finalrule.

The Department also recognizes thatsome schools or school food authoritiesmay choose to use food-based menusystems and to conduct their ownnutrient analysis. In these situations, theState agency may employ the analysisprepared by the local entity in lieu ofconducting a separate nutrient analysis,provided that the nutrition analysis isdone in accordance with theDepartment’s criteria.

Using the Results of Nutrient AnalysisTo Measure Compliance

The results of the nutrient analysisfrom each production source would beused to determine compliance with theDietary Guidelines’ recommendation forlimiting the calories from fat andsaturated fat as well as the calories andthe nutrient levels for the age/gradegroups. In addition, the levels ofsodium, cholesterol and dietary fiberwould also be determined. These figureswould be used for future reviews todetermine if the school food authorityhad progressed toward meeting thenutrition standards.

School food authorities found to beout of compliance with the nutritionstandards would be required to initiatecorrective action. This requirement isconsistent with what was proposed forimplementation of NuMenus andAssisted NuMenus in the June 10, 1994,proposed regulation. School foodauthorities would be required todevelop an acceptable corrective actionplan in collaboration with the Stateagency. For school food authoritiesmaking good faith efforts to complywith the terms of the corrective actionplan, the State agency would providetechnical assistance and training to helpthem meet the nutrition standards andDietary Guidelines. However, consistentwith the June 10, 1994, proposal, if theschool food authority has not beenacting in good faith to meet the terms ofthe corrective action plan and refuses torenegotiate the plan, the State agencyshall determine if a disallowance ofreimbursement funds is warranted.


Miscellaneous Revisions

School Week

Sections 106(b) and 201(a) of Pub. L.103–448 mandate that the nutritionalrequirements for school meals be basedon a weekly average. The use of aweekly average was proposed by theDepartment on June 10, 1994 toestablish a time frame for analyzingnutrients under NuMenus and AssistedNuMenus. The Department is proposingto add a more general definition of‘‘School week’’ to § 210.2 and to § 220.2to clarify the appropriate time period fordetermining compliance with therequired nutrition standards. Asproposed here, ‘‘School week’’ would bea minimum of three days and amaximum of seven days, and the dayswould be consecutive.

Food Component, Food Item

The definitions in § 210.2 of ‘‘Foodcomponent’’ and ‘‘Food Item’’ would berevised to reflect the new title of thegrains/breads component that wouldreplace the current title of bread/breadalternate. The Department would alsolike to note that no changes are beingproposed to the number of items thatcomprise a reimbursable meal. Fiveitems will continue to be required for areimbursable lunch, and under the offerversus serve option, three of the fiveitems must be taken.

Lunch

The definition of ‘‘Lunch’’ in § 210.2would be revised to incorporate areference to the nutrition standards aspart of the elements that reimbursablemeals must meet. Readers should notethat this proposal repeats the definitionof ‘‘Lunch under NuMenus and AssistedNuMenus’’ and under the current mealpattern, as proposed in the June 10,1994, rulemaking. The Department isrepeating this provision in order toprovide readers with a completedefinition of ‘‘Lunch’’ under all mealplanning systems. However, since theDepartment has already receivedcomments on the earlier definition, theDepartment will not accept additionalcomments on the definition of lunchunder NuMenus and AssistedNuMenus.

Milk Component

In § 210.10(d)(1) there is a specialexemption for schools that, prior to May1, 1980, served six fluid ounces insteadof the currently required eight fluidounces to children ages 5–8 in gradeskindergarten through grade 3. Thisproposal would remove this obsoletereference.

Effective DatesSection 106(b)(2) of Pub. L. 103–448

requires that schools implement theDietary Guidelines by July 1, 1996,unless a State agency grants a waiver topostpone implementation. Waivers maydelay implementation to no later thanJuly 1, 1998.

The statute also permits the Secretaryto establish a date for implementationlater than July 1, 1998. The Departmentdoes not presently envision extendingthis deadline because of the need tobegin compliance with the DietaryGuidelines in an expeditious manner.

In addition, section 112(c)(3) of Pub.L. 103–448, 42 U.S.C. 1760(k)(3),requires the Department to issue a finalregulation on this subject by June 1,1995, incorporating the results of thisproposed rulemaking as well as thoseconcerning NuMenus and AssistedNuMenus that were proposed in theJune 10, 1994, rule. Further, theDepartment, in compliance with section112(c)(2) of Pub. L. 103–448, 42 USC1760(k)(2), will be issuing a notice inthe Federal Register to announce apublic meeting to discuss this proposedaction. This meeting will be held within45 days of publication of thisrulemaking and will be open to allinterested parties and organizations.The Department encourages personsreviewing this proposed rule to watchfor the Federal Register announcementof the public meeting.

While compliance with the updatednutrition standards is not required untilJuly 1, 1996 (or later if waived by theState agency), school food authoritiesare encouraged to work towards meetingthe Dietary Guidelines as well as theappropriate levels of nutrients andcalories as soon as feasible.

List of Subjects

7 CFR Part 210Children, Commodity School

Program, Food assistance programs,Grants programs-social programs,National School Lunch Program,Nutrition, Reporting and recordkeepingrequirements, Surplus agriculturalcommodities.

7 CFR Part 220Children, Food assistance programs,

Grant programs—social programs,Nutrition, Reporting and recordkeepingrequirements, School Breakfast Program.

Accordingly, 7 CFR Parts 210 and 220are proposed to amended as follows:

PART 210—NATIONAL SCHOOLLUNCH PROGRAM


Authority: 42 U.S.C. 1751–1760, 1779.

2. In § 210.2:a. the definition of ‘‘Food component’’

is revised;b. the definition of ‘‘Food item’’ is

revised;c. the definition of ‘‘Lunch’’ is

revised; andd. a new definition of ‘‘School week’’

is added in alphabetical order. Therevisions and addition read as follows:

§ 210.2 Definitions.

* * * * *Food component means one of the

four food groups which compose thereimbursable school lunch, i.e., meat ormeat alternate, milk, grains/breads andvegetables/fruits.

Food item means one of the fiverequired foods that compose thereimbursable school lunch, i.e., meat ormeat alternate, milk, grains/breads, andtwo (2) servings of vegetables, fruits, ora combination of both.* * * * *

Lunch means a meal which meets thenutrient and calorie levels designated in§ 210.10(c) and, if applicable, the schoollunch pattern for specified age/gradegroups as designated in § 210.10.* * * * *

School week means the period of timeused as the basis for determiningcompliance with the 1990 DietaryGuidelines for Americans and thecalorie and nutrient levels in§ 210.10(c)(2). The period shall be aminimum of three consecutive days anda maximum of consecutive seven days.Weeks in which school lunches areoffered less than three times shall becombined with either the previous orthe coming week.* * * * *

3. In § 210.10:a. The section heading is revised;b. The heading of paragraph (a) is

revised;c. Paragraph (c) is revised;d. The last two sentences of the

concluding text following paragraph(d)(1) are removed;

e. A new sentence is added at the endof paragraph (d)(3);

f. The heading of paragraph (d)(4) isrevised; and

g. The second through fifth sentencesof paragraph (d)(4)(ii) are removed andone new sentence is added in theirplace.

The additions and revisions read asfollows:

§ 210.10 Nutrition standards for lunchesand menu planning methods.

(a) Definitions for infant meals. * * ** * * * *


(c) Minimum quantities/nutrientlevels for food-based menu systems.

(1) At a minimum, schools shall servemeals in the quantities provided in thefollowing chart:

MINIMUM QUANTITIES

REQUIRED FOR OPTION FOR

AGES 1–2 PRESCHOOL GRADES K–6 GRADES 7–12 GRADES K–3

MEAL COMPONENT:MILK .............................................................. 6 OUNCES ....... 6 OUNCES ....... 8 OUNCES ....... 8 OUNCES ....... 8 OUNCES.MEAT OR MEAT ALTERNATE .................... 1 OUNCE ......... 11⁄2 OUNCES ... 2 OUNCES ....... 2 OUNCES ....... 11⁄2 OUNCES.FRUITS AND VEGETABLES ........................ 1⁄2 CUP ............. 1⁄2 CUP ............. 3⁄4 CUP PLUS

ADDITIONAL1⁄2 CUPOVER AWEEK.

1 CUP ............... 3⁄4 CUP.

GRAINS AND BREADS ................................ l5 SERVINGSPER WEEK—MINIMUM OF1⁄2 PER DAY.1

l8 SERVINGSPER WEEK—MINIMUM OF1 PER DAY.1

l12 SERVINGSPER WEEK—MINIMUM OF1 PERDAY.1 2

15 SERVINGSPER WEEK—MINIMUM OF1 PERDAY.1 2

10 SERVINGSPER WEEK-MINIMUM OF1 PERDAY.1 2

1 FOR THE PURPOSES OF THIS CHART, WEEK EQUALS FIVE DAYS.2 UP TO ONE GRAINS/BREADS SERVING PER DAY MAY BE A DESSERT.

(2) At a minimum, schools shallprovide the following calorie andnutrient levels over a school week:

CALORIE AND NUTRIENT LEVELS FOR SCHOOL LUNCH

PRE-SCHOOL

GRADESK–6

GRADES7–12

GRADESK–3 OP-

TION

ENERGY ALLOWANCES (CALORIES) ............................................................................................. 517 664 825 633TOTAL FAT (AS A PERCENTAGE OF ACTUAL TOTAL FOOD ENERGY) .................................... (1) (1) (1) (1)TOTAL SATURATED FAT (AS A PERCENTAGE OF ACTUAL TOTAL FOOD ENERGY) ............. (2) (2) (2) (2)PROTEIN (g) ...................................................................................................................................... 7 10 16 9CALCIUM (mg) ................................................................................................................................... 267 286 400 267IRON (mg) .......................................................................................................................................... 3.3 3.5 4.5 3.3VITAMIN A (RE) ................................................................................................................................. 150 224 300 200VITAMIN C (mg) ................................................................................................................................. 14 15 18 15

1 NOT TO EXCEED 30 PERCENT OVER A SCHOOL WEEK.2 NOT TO EXCEED 10 PERCENT OVER A SCHOOL WEEK.

(3) School food authorities shallcomply with 1990 Dietary Guidelinesfor Americans and the provisions inparagraph (c)(2) of this section no laterthan July 1, 1996 except that Stateagencies may grant waivers to postponeimplementation until no later than July1, 1998. Such waivers shall be grantedby the State agency using guidanceprovided by the Secretary.

(d) Lunch components. * * *(3) Vegetable or fruit. * * * For

children in kindergarten through gradesix, the requirement for this componentis based on minimum daily servings andan additional 1/2 cup in anycombination over a five day period.

(4) Grains and breads. * * *(ii) * * * The requirement for this

component is based on minimum dailyservings plus total servings over a fiveday period. * * ** * * * *

4. In § 210.19, paragraphs (a)(1)through (a)(5) are redesignated asparagraphs (a)(2) through (a)(6)respectively, and a new paragraph (a)(1)is added to read as follows:

§ 210.19 Additional responsibilities.(a) General Program management.

* * *(1) Compliance with nutrition

standards. Unless waived in accordancewith § 210.10(c)(3), beginning withSchool Year 1996–97, school foodauthorities shall comply with the 1990Dietary Guidelines for Americans andthe calorie and nutrient levels specifiedin § 210.10(c) for reimbursable meals.

(i) Beginning with School Year 1996–97, State agencies shall evaluatecompliance with the establishednutrition standards over a school week.At a minimum, these evaluations shallbe conducted once every 5 years andmay be conducted at the same time a

school food authority is scheduled foran administrative review in accordancewith § 210.18. State agencies may alsoconduct these evaluations inconjunction with technical assistancevisits, other reviews, or separately.Except as provided in this paragraph(a)(1)(i), the State agency shall conductnutrient analysis on the menu(s) servedduring the review period to determine ifthe 1990 Dietary Guidelines forAmericans and the calorie and nutrientlevels specified in § 210.10(c)(2) and§ 220.8(a)(2) of this chapter were met.However, the State agency may:

(A) Use the nutrient analysis of anyschool or school food authority thatoffers meals using the food-based menusystems approaches provided in§ 210.10(c) and/or § 220.8(b) of thischapter and that conducts its ownnutrient analysis under criteriaestablished by USDA of those meals; or


(B) Develop its own method forcompliance review, subject to USDAapproval.

(ii) if the menu for the school weekfails to comply with the 1990 DietaryGuidelines for Americans and/or tomeet the calorie and nutrient levelsspecified in § 210.10(c)(2) and/or§ 220.8(a)(2) of this chapter, the schoolfood authority shall develop, with theassistance and concurrence of the Stateagency, a corrective action plandesigned to rectify those deficiencies.The State agency shall monitor theschool food authority’s execution of theplan to ensure that the terms of thecorrective action plan are met.

(iii) If a school food authority failedto meet the terms of the correctiveaction plan, the State agency shalldetermine if the school food authority isworking towards compliance in goodfaith and, if so, may renegotiate thecorrective action plan, if warranted.

However, if the school food authorityhas not been acting in good faith to meetthe terms of the corrective action planand refuses to renegotiate the plan, theState agency shall determine if adisallowance of reimbursement funds asauthorized under paragraph (c) of thissection is warranted.* * * * *

PART 220—SCHOOL BREAKFASTPROGRAM


Authority: 42 U.S.C. 1773, 1779.

2. In § 220.2, a new paragraph (w–1)is added to read as follows:

§ 220.2 Definitions.* * * * *

(w–1) School week means the periodof time used as the basis for determiningcompliance with the 1990 Dietary

Guidelines for Americans and thecalorie and nutrient levels in§ 220.8(a)(2). The period shall be aminimum of three consecutive days anda maximum of seven consecutive days.Weeks in which school breakfasts areoffered less than three times shall becombined with either the previous orthe coming week.* * * * *

3. In § 220.8, the section heading andparagraph (a) are revised to read asfollows:

§ 220.8 Nutrition standards for schoolbreakfasts and menu planning methods.

(a) Minimum quantities/nutrientlevels for food-based menu systems.

(1) At a minimum, schools shall servemeals in the quantities provided in thefollowing chart:

MINIMUM QUANTITIES

REQUIRED FOR OPTION FOR

AGES 1–2 PRESCHOOL GRADES K–12 GRADES 7–12

MEAL COMPO-NENT:

MILK (FLUID) 1 11⁄2 CUP ............................... 3⁄4 CUP ................................. 8 OUNCES .......................... 8 OUNCES.MEAT OR

MEAT AL-TERNATE.

1⁄2 OUNCE PLUS ................. 1⁄2 OUNCE PLUS ................. 1 OUNCE PLUS .................. 2 OUNCES PLUS

GRAINS/BREADS.

1⁄2 SERVING EACH OFGRAINS/BREADS ANDMEAT/MEAT ALTER-NATE (1⁄2 OUNCE) OR.

2 GRAINS/BREADS OR ......2 MEAT/MEAT ALTERNATE

(1 OUNCE).

1⁄2 SERVING EACH OFGRAINS/BREADS ANDMEAT/MEATALTERNATE(1⁄2 OUNCE)OR.


(1 OUNCE).

ONE SERVING EACH OFGRAINS/BREADS ANDMEAT/MEAT ALTER-NATE (1 OUNCE) OR.


(2 OUNCES).

ONE SERVING EACH OFGRAINS/BREADS ANDMEAT/MEAT ALTER-NATE (2 OUNCES) OR

2 GRAINS/BREADS OR2 MEAT/MEAT ALTERNATE

(4 OUNCES) PLUSADDITIONAL 1 OUNCE

PER DAY OF GRAINS/BREADS.

VEGETABLES/FRUITS 2.

1⁄4 CUP ................................. 1⁄2 CUP ................................. 1⁄2 CUP ................................. 1⁄2 CUP.

1 A SERVING OF FLUID MILK SERVED AS A BEVERAGE OR ON CEREAL OR USED IN PART FOR EACH PURPOSE.2 A SERVING OF FRUITS OR VEGETABLES OR BOTH, OR FULL-STRENGTH FRUIT OR VEGETABLE JUICE.

(2) At a minimum, schools shallprovide the following calorie andnutrient levels over a school week:

CALORIE AND NUTRIENT LEVELS FOR SCHOOL BREAKFAST

PRE-SCHOOL

GRADESK–12

OPTIONFOR

GRADES7–12

ENERGY ALLOWANCES (CALORIES) ................................................................................................................ 388 554 618TOTAL FAT (AS A PERCENTAGE OF ACTUAL TOTAL FOOD ENERGY) ....................................................... (1) (1) (1)TOTAL SATURATED FAT (AS A PERCENTAGE OF ACTUAL TOTAL FOOD ENERGY) ................................ (2) (2) (2)PROTEIN (g) ......................................................................................................................................................... 5 10 12CALCIUM (mg) ...................................................................................................................................................... 200 257 300IRON (mg) ............................................................................................................................................................. 2.5 3.0 3.4VITAMIN A (RE) .................................................................................................................................................... 113 197 225VITAMIN C (mg) .................................................................................................................................................... 11 13 14

1 NOT TO EXCEED 30 PERCENT OVER A SCHOOL WEEK.


2 NOT TO EXCEED 10 PERCENT OVER A SCHOOL WEEK.

(3) School food authorities shallcomply with 1990 Dietary Guidelinesfor Americans and the provisions inparagraph (c)(2) of this section at thesame time such provisions areimplemented for the National SchoolLunch Program in accordance with§ 210.10 (c)(3) of this chapter.* * * * *

4. In § 220.13, paragraphs (f)(3) and(f)(4) are redesignated as paragraphs(f)(4) and (f)(5), respectively and a newparagraph (f)(3) is added to read asfollows:

§ 220.13 Special responsibilities of Stateagencies.

* * * * *(f) * * *(3) For the purposes of compliance

with the 1990 Dietary Guidelines forAmericans and the calorie and nutrientlevels specified in § 220.8(a)(2), theState agency shall follow the provisionsspecified in § 210.19(a)(1) of thischapter.* * * * *

Dated: January 18, 1995.Ellen HaasUnder Secretary for Food, Nutrition, andConsumer Services

Appendix A—Regulatory Cost/BenefitAssessment: Food-Based Menu Systems

1. Title: National School Lunch andSchool Breakfast Program: Food-BasedMenu Systems.

2. Background: The proposed rule forfood-based menu systems is anextension of the proposed rule onNutrition Objectives for School Mealswhich was published in the June 10,1994 Federal Register at 59 FR 30218(USDA Food and Nutrition Service,1994).

This cost/benefit assessment extendsthe cost/benefit assessment which wasdeveloped for the proposed rule onNutrition Objectives for School Meals toencompass the proposed food-basedmenu systems. That analysis waspublished in the Federal Register alongwith the rule.

The Healthy Meals for HealthyAmericans Act of 1994, P.L. 103–448,November 2, 1994, requires USDA toprovide within the National SchoolLunch and School Breakfast Programsan option for planning meals using afood-based system. This proposed ruleamends the current meal patterrequirements and defines the foodcomponents and the minimumquantities for each component forvarious ages or grade levels. It alsodefines the nutrient requirements for

school meals for each of the age or gradelevels, using levels derived from themost recent (1989) RecommendedDietary Allowances (RDAs) publishedby the National Research Council andfrom the quantitative recommendationsfor the maximum levels of fat andsaturated fat as a percent of caloriescontained in the most recent (1990)USDA/DHHS Dietary Guidelines forAmericans. These changes would beimplemented by July 1, 1996 as requiredby law.

3. Statutory Authority: NationalSchool Lunch Act (42 U.S.C. 1751–1760, 1779) and Child Nutrition Act of1966 (42 U.S.C. 1773, 1779).

4. Cost/Benefit Assessment ofEconomic and Other Effects:

SynopsisThis assessment finds that the

proposed food-based menu systemrequirements can be met within currentfood costs and with market impacts atlevels presented for the NutrientStandard Menu Planning systemproposed in the June 10, 1994 FederalRegister. Compared to current schoolfood service practice, improvement infood preparation techniques and foodselections within food categories wouldbe needed to meet the proposed food-based menu system requirements andRDA/Dietary Guidelines-derivednutrient targets for NSLP. While averagefood cost need not change, there will bea cost at the state level for establishingand conducting nutrient analysis as aroutine component of local reviews. Thenational total for this cost is estimatedto be less than $2 million per year, andis offset by continuation of thepreviously proposed 20 percentreduction in state monitoringrequirements.

a. Costs To Produce a Meal

The cost/benefit analysisaccompanying the June 10, 1994regulatory proposal ‘‘NutritionObjectives for Healthy School Meals’’determined that by using the NutrientStandard Menu Planning approach it ispossible within the current cost toprovide school meals which meetdefined nutrient targets derived fromRDAs and the Dietary Guidelines forAmericans. Since the food-based menuplanning system is being proposed as asystem which may be used in lieu ofNutrient Standard Menu Planning(NSMP) and Assisted Nutrient StandardMenu Planning, school food authoritieswill be able to select the planningapproach which best fits their needs,

including consideration of the cost ofplanning and providing meals under thevarious available methods. Thisdocument extends the previouslypublished analysis and discussion tocover the food-based menu planningoption. Since the proposed meal patternfor the School Breakfast Program retainsthe existing pattern, this analysisfocuses on the lunch meal.

DataA nationally representative sample

included in the School Lunch andBreakfast Cost Study conducted for FNSby Abt Associates found an average foodcost of $0.72 for school lunch mealsprepared under the current mealpattern, rounded to the nearest wholecent (Abt Associates, 1994). Thisincludes costs for all foods served aspart of the National School LunchProgram (NSLP) reimbursable meal andis not limited to the cost of items whichare credited towards the current mealpattern requirement, but excludes itemsoffered for sale as a la carte. Forexample, if a school included acondiment bar and a cookie dessertalong with the NSLP meal without anadditional charge, the cost of theingredients in the condiment bar andthe cookie dessert were included in theoverall average food cost determination,even though these items were notcredited towards meeting the mealpattern minimum requirements.Similarly, if a school included in itsNSLP meal more than the minimumamount of vegetable and fruit requiredby the current meal pattern, the cost ofthe ingredients in the full amountincluded in the NSLP meal wasincluded in the overall average food costdetermination.

Data on actual foods served in theNSLP were obtained from the 1993USDA School Nutrition DietaryAssessment (SNDA) study conducted byMathematica Policy Research for FNS(Mathematica Policy Research, 1993).The study included a survey of about3550 students in grades 1 through 12 in545 schools throughout the country. Thestudents reported detailed informationon the kinds and amounts of foods andbeverages they consumed during a 24-hour period. The impact analysis usedonly the portion of the data on foodsserved to children as part of creditedschool lunches. It included plate wastebut excluded a la carte items, such asdesserts, purchased in addition to theschool lunch. The SNDA surveycontained detailed information on over600 food items served in the school


lunch program. These items wereaggregated into 52 food groups based onthe primary ingredient and the percentof calories from fat. For example, therewere two beef categories: high-fat andlow-fat beef; two poultry categories; etc.

Food costs were estimated fromingredient cost data obtained in the1993 School Lunch and Breakfast CostStudy and recipes for school lunchitems. The recipes were necessary fortwo reasons: aggregation of ingredientcosts to costs of food served, and forestimating the change in usage of thevarious agricultural commodities.

The USDA Economic ResearchService (ERS) developed a computer

model incorporating the above data toassist in estimating the possible range ofmarket impacts from the changes in theJune 10, 1994 proposed rule. For thecurrent analysis, this model wasextended to reflect the food componentcrediting used in food-based menuplanning. Crediting for each of the 52food groups towards the four foodcomponents of the existing NSLP mealpattern was estimated by FNS usinginformation contained in the ‘‘FoodBuying Guide for Child NutritionPrograms.’’ This extended model wasthen used to determine the averageNSLP crediting of the NSLP mealsincluded in the SNDA data.

Findings

Table 1 shows in abbreviated form thecurrent meal pattern requirements forNSLP for grades K–12. For consistencywith the proposed regulation the current‘‘Bread or Bread Alternate’’ componentwill be referred to as ‘‘Grains/Breads’’ asproposed. This table is accompanied inprogram guidance with therecommendation that ‘‘portions beadjusted by age/grade group to bettermeet the food and nutritional needs ofchildren according to their ages * * *.If portions are not adjusted, the GroupIV portions are the portions to serve allchildren.’’

TABLE 1.—SCHOOL LUNCH MEAL PATTERNS FOR GRADES K–12 (ABBREVIATED)

Minimum quantities Recommendedquantities

Food components Food itemsGrades K–3,

ages 5–8(group III)

Grades 4–12,age 9 and over

(group IV)

Grades 7–12,age 12 and

over (group V)

Meat/Meat Alternate .............. Lean meat, poultry, or fish, or cheese, or equivalent fromeggs, cooked dried beans or peas, peanut butter orother nut or seed butters or certain other alternates.

1.5 oz. ............. 2 oz ................. 3 oz.

Vegetables/Fruits ................... 2 or more servings of vegetables or fruits or both to total .. .5 cups ............ .75 cups .......... .75 cups.Grains/Breads ........................ Servings of grains/breads of which a minimum or 1 per

day must be enriched or whole-grain.8 per week ...... 8 per week ...... 10 per week.

Milk (as a beverage) ............. Fluid whole milk, and fluid unflavored lowfat milk, skimmilk, or buttermilk.

8 fl.oz .............. 8 fl.oz .............. 8 fl.oz.

Table 2 shows the findings derivedfrom the School Nutrition DietaryAssessment Study (SNDA) data for eachof the four required food components inthe units used for the school mealpatterns. These SNDA data show that,on average, NSLP meals served forgrades K–12 exceed the existingminimum meal pattern requirements formeat/meat alternates; grains/breads; andvegetables/fruits. The average for fluidmilk is slightly below the 8 fluid ounceminimum (7.5 fl. oz.), which is expecteddue to NSLP offer versus serve (OVS)rules. The proposed rule maintains thecurrent meal pattern requirements foroffering 8 fluid ounces of milk as abeverage.

TABLE 2.—AVERAGE AMOUNT OFEACH POTENTIALLY CREDITABLEFOOD COMPONENT AS FOUND INSCHOOL YEAR 1991–92

Food component

Esti-matedaver-age

amountin

NSLPmeals,schoolyear

1991–92

Meat/Meat Alternate (oz.) ................. 2.8Vegetables/Fruits (cups) .................. 1.0Grains/Breads (servings) .................. 2.5Milk (as a beverage) (oz.) ................ 7.5

Using the extended school mealsmodel, the average cost of each foodcomponent was estimated. Under boththe existing meal pattern system and theproposed food-based menu system, theoldest age/highest grade group alwaysrequires the largest quantity of foodfrom each food component. Tables 3and 4 compare the SNDA findings onmeals served by food component to thelargest quantities of the meal pattern

requirements currently in place (Table3) and as proposed (Table 4).

These tables show that within theexisting reimbursement structure,schools already provide meals which,on average:

• For Meat/meat alternate, exceed theoldest age/grade minimums of both thecurrent and proposed rules.

• For Vegetables/fruits, exceed theminimum of the current meal pattern forthe oldest age/grade group, and are onaverage equal to the minimum for theoldest age/grade group of the proposedrule.

• For Grains/breads, exceed theminimum of the current meal pattern forthe oldest age/grade group, and are onaverage about 0.5 servings per day lessthan the minimum for the oldest age/grade group of the proposed rule.

The proposed grains/breads minimumfor the largest group of NSLPparticipants, grades K–6, is 12 servingsper week, compared to the proposed 15servings per week for grades 7–12.When weighted by historical studentparticipation, the overall weightedaverage proposed minimum for grains/breads is equal to about 2.6 servings perday. Therefore, the current NSLP mealsserve only slightly less (0.1 servings perday) than the proposed weighted


average minimum. Grains/breads is theleast expensive food component on aper serving basis, averaging 3.2 centsper serving.

In summary, compared to the currentmeal pattern minimums, the proposedfood-based menu system holds milk andmeat/meat alternate constant andrequires an increase in the minimumgrains/breads and vegetables/fruits, butdoes not require an increase on averageover current serving practices except for0.5 servings of bread per week.

TABLE 3.—DIFFERENCE BETWEEN AC-TUAL NSLP FOOD AND THE HIGHESTMINIMUM REQUIREMENTS OF THECURRENT MEAL PATTERN

Food compo-nent

Largestquantityrequiredby cur-

rentNSLPmeal

pattern

Esti-matedaver-age

amountin


1991–92

Dif-ference(actualminus

required)

Meat/Meat Al-ternate(oz.).

2.0 2.8 +0.8

Vegetables/Fruits(cups).

.75 1.0 +0.25

Grains/Breads (av-erageservingsper day).

1.6 2.5 +0.9

Milk (as abeverage)(oz.).

8.0 7.5 1 ¥0.5

1 Probably not zero due to OVS effect.

TABLE 4.—DIFFERENCE BETWEEN AC-TUAL NSLP FOOD AND THE HIGHESTMINIMUM REQUIREMENTS OF THEPROPOSED FOOD-BASED MENU SYS-TEM

Food compo-nent

Largestquan-tity re-quiredby pro-posedNSLPfood-basedmenu

system

Esti-matedaver-age

amountin


1991–92

Dif-ference(actualminuspro-

posed)

Meat/Meat Al-ternate (oz.).

2.0 2.8 +0.8

Vegetables/Fruits (cups).

1.0 1.0 no dif-fer-ence

TABLE 4.—DIFFERENCE BETWEEN AC-TUAL NSLP FOOD AND THE HIGHESTMINIMUM REQUIREMENTS OF THEPROPOSED FOOD-BASED MENU SYS-TEM—Continued

Food compo-nent

Largestquan-tity re-quiredby pro-posedNSLPfood-basedmenu

system

Esti-matedaver-age

amountin


1991–92

Dif-ference(actualminuspro-

posed)

Grains/Breads(averageservings perday).

3.0 2.5 ¥0.5

Milk (as a bev-erage) (oz.).

8.0 7.5 ¥0.5 1

1 Probably not zero due to OVS effect.

Reanalysis of Market Impact ScenariosThe three scenarios for potential

market impacts described in the June10, 1994 proposal were reanalyzed,incorporating the extended data on foodcomponent crediting. These threeexample market impact scenarios weredeveloped using a model thatconstrained NSLP food cost to remain atthe average per meal cost leveldetermined by the School Lunch andBreakfast Cost Study and meet theproposed nutrient targets. The firstscenario minimized change from currenteating choices for specific commodities,but allows substitution among the 52food groups. The second scenario is thesame as the first, but demonstrates theeffect of shifting all chicken to lower fatchicken to show how change inpreparation or commercial availabilitycan affect a particular commodity. Thethird scenario required that there be nochange in the total quantities of thevarious major commodities used (exceptfor butter), and tended to increase therelative use of the lower fat versions ofthe commodities (e.g., lower fat porksuch as ham instead of ribs or bacon).In addition, the extended school lunchmodel was used to determine theaverage food cost for each of the fourfood components. The followingdescribes the findings from theseanalyses.

Table 5 shows the results of applyingthe NSLP crediting rules to the threeimpact scenarios. The quantities shownin table 5 are daily averages across allgrades K–12.

Meat/Meat AlternateThe proposed average minimum

servings of meat/meat alternate is not

met in Scenario 1, but is exceeded inScenarios 2 and 3. Scenario 1 provides1.9 ounces of meat/meat alternate,which is not sufficient to meet the 2ounces minimum requirement forgrades K–6 and 7–12. This scenario wasdeveloped to show the effect ofminimizing the change in current foodofferings (e.g., trying to maintain thepercentage of meat/meat alternate fromlower fat chicken and higher fatchicken). Since the grades K–3 meat/meat alternate requirement is 1.5ounces, the actual average minimumrequirement for grades K–12 will beslightly less than 2.0 ounces. However,at least 20 percent of the school mealswould need to be provided using the K–3 pattern for the overall averageminimum requirement to be 1.9 ounces.While more than 20 percent of all NSLPmeals are served to children in gradesK–3, for administrative efficiency theseare often served using the meal patternfor older students, so the overall averageminimum requirement is likely to beabove 1.9 ounces.

Grains/breads

The proposed average grains/breadsminimum servings is met or exceededby all three scenarios. All threescenarios exceed the minimumrequirement for grains/breads for gradesK–6. Scenarios 1 and 2 also exceed theminimum requirement for grades 7–12.Scenario 3 provides 2.6 servings ofgrains/breads, which as discussedabove, is equal to the overall weightedaverage proposed minimum for grains/breads.

Vegetables/fruits

The proposed average vegetables/fruits minimum servings is met orexceeded by all three scenarios.Scenarios 2 and 3, which allow forsomewhat larger shifts in foodpreparation methods, provide more thanthe largest minimum requirement of theproposed food-based menu systemsexcept for vegetables/fruits in scenario3. The amount of vegetables/fruits inscenario 3, 0.9 cups, exceeds theamount required for grades K–6 (average0.85 cups per day), and isapproximately equal to the expectedaverage minimum requirement acrossall NSLP meals. Over 60 percent of themeals are served to students in gradesK–6, and some of these will be servedin schools using the grades K–3 pattern,which requires only 0.75 cupsvegetables/fruits, so the overall averageminimum requirement across all NSLPmeals is approximately 0.9 cups.


TABLE 5.—AVERAGE DAILY NSLP SERVINGS: BASELINE AND THREE SCENARIOS

Meat/meatalter-nate(oz.)

Grains/breads

(servings)

Vege-tables/fruits

(cups)

Milk (fl.oz.)

Baseline (SNDA) ......................................................................................................................................... 2.8 2.5 1.0 7.5Scenario 1 (no change of preparation techniques) ..................................................................................... 1.9 4.2 1.3 7.5Scenario 2 (lower fat chicken preparation) ................................................................................................. 2.1 4.1 1.2 7.5Scenario 3 (shifts of selections within components; no change in commodity markets) ........................... 2.9 2.6 0.9 7.5

Cost for Food ComponentsThe extended school lunch model

was used to estimate the average cost foreach food component at baseline and forthe three market impact scenarios. Thecost for non-creditable foods which aresometimes served with lunch, such asnon-fruit desserts, was also estimated.The average cost for a 2 ounce servingmeat/meat alternate increased by about1⁄2 cent in scenarios 1 and 2, and by 1cent in scenario 3. This is consistentwith the expectation of some foodpersonnel that leaner selections fromthe meat/meat alternate component mayincrease unit cost for this component.The per serving cost also increased forvegetables/fruits. The average cost of 1⁄2cup of vegetables/fruits increased by 1⁄2cent in scenarios 1 and 2, and by 0.2cents in scenario 3. The cost of 8 fluidounces of milk remained the same inscenarios 1 and 2, and increased by 0.2cents in scenario 3.

In contrast, the average cost of aserving of grains/breads decreased by0.4 cents in scenarios 1 and 2 and by 0.7cents in scenario 3. In scenarios 1 and2, there was no change in the total 0.6cents per meal available for non-creditable items, but in scenario 3, about0.1 cents of this was shifted tocreditable items.

This cost-per-component-servinganalysis shows that the cost of food forthe NSLP meals can be maintained,even when the average cost for somecomponents increases, without severelydiminishing the funds available for non-creditable foods which help flavormeals to meet individual preferences.The ability to select slightly lessexpensive items from the grains/breadscomponent can effectively offset boththe modest per serving cost increases inother components and the slightlyincreased average minimumrequirement (+0.5 servings per week) forgrains/breads.

By definition, the average resultsreported above mean that some schooldistricts would be expected toexperience food costs that varyconsiderably from those reported above.This is not different from the current

situation because there is already a widerange of food costs due to factors suchas economies of size, geographicvariation in delivery and labor costs,and local market conditions. Similarly,average quantities served also varyamong schools and sometimes withinschools. If a school currently servingless than the average portions of grains/breads or vegetables/fruits opts for theproposed food-based menu planningsystem, they may have to increase thequantities offered.

ConclusionIn summary, the findings for the three

scenarios indicate that the proposedNSLP food-based menu systemrequirements can be met within currentfood costs and with market impacts atlevels presented in the June 10, 1994Federal Register. At least someimprovement in food preparationtechniques and food selections withinfood categories would be needed tomeet the proposed menu systemrequirements and RDA/DietaryGuidelines-derived nutrient targets forNSLP. Efforts which may influence thespeed and direction of these shifts, suchas training and technical assistance forschool food service personnel inimproved menu planning and foodpreparation techniques, development ofimproved recipes, and production oflower fat products by industry, couldhelp to simplify implementation whenthe food-based menu planning system isselected.

b. Implementation CostsThis section expands upon the

Section e. Implementation Costcontained in the June 10, 1994 FederalRegister cost/benefit assessment tocover the food-based menu planningsystem option. As stated there, initialimplementation costs faced by schoolswill vary depending on existingcapabilities and resources withindistricts and will take many forms. Thisproposal provides schools with a newoption, so they would have the optionof selecting among NSMP, Assisted-NSMP, or the food-based menuplanning system. Schools are expected

to consider implementation costs inmaking their selection.

Local, State and Federal resources areavailable for implementation. USDA hasalready initiated a number ofimprovements which will assist inimplementation, some of which apply toa specific planning system option andothers which will assist schools inselecting the option best suited to theirneeds. These include updated andimproved recipes for schools, acomputerized data bank of standardnutritional values of meals served and ademonstration project on NSMP. Thedemonstration will incur much of thedevelopmental cost of the basic NSMPsystem framework and identify costeffective strategies for implementation.

The Department believes thatimplementation of meal improvementswill be facilitated if students arereceptive to the changes in foods. Anumber of efforts will help encouragestudents to accept such changes. Centralto this effort is the Department’sChildren’s Nutrition Campaign, a multi-faceted national effort designed tomotivate children to make healthierfood choices by getting them excitedabout making choices and giving themthe skills to do so. It is designed todeliver nutrition messages throughmultiple and reinforcing channels tomaximize impact and credibility. Corecomponents will be mass media and in-school efforts, supplemented bystrategic public-private partnerships toleverage USDA investments and extendreach. The FY 1995 federal budgetincludes over $20 million to launch thiscampaign and to provide extensivetraining for school meal providers onhow to plan and prepare nutritious andappealing meals. The Department hasawarded nutrition educationcooperative agreements to developcomprehensive community-basedapproaches to nutrition education. TheDepartment is also assisting school foodservice professionals by working withchefs, farmers and others to make schoolmeals appealing and healthful.

States receive over $90 millionannually from the Federal level in StateAdministrative Expense (SAE) funds for


program oversight. A portion of theseresources are available to assist inimplementation. Some of the FY 1995federal funds for training will be usedto train states on implementation of themanagement systems needed to supportfood-based menu planning, includingthe requirement for periodic nutrientanalysis of school meals by the State asa component of local reviews. Inaddition, since the review cycle hasbeen extended from four years to fiveyears, the proposed regulation wouldreduce the level of State resourcesdevoted to local school food authorityreviews, which is described in moredetail below.

At the local level, if the proposedfood-based menu planning system isselected, it may require training andtechnical assistance for some staff. Thecontinuation of the historical foodcomponent definitions and creditingrules (with one improvement for grainsin desserts) will simplify thisimplementation. However, meals must,on average over a week, meet the RDA/Dietary Guidelines-based nutrienttargets, and achieving this through afood-based menu system requires aconsiderably greater level of nutritionknowledge than that required to fulfilla meal pattern only. For example, themeal planner must know whichcombinations of food choices over eachweek are acceptable to students and arelikely to result in meals that offer atleast the food component minimumsand provide adequate calories, iron andother nutrients without exceeding thefat and saturated fat limits as a percentof calories.

A study of school food authorities inthe mid-Atlantic region found thatunder the existing meal pattern system,60 percent of school food authorities(SFAs) employ computers for somefunctions (Brewer, DeMicco and Conn,1993). Over one-fourth of these districtshad comprehensive systems thatallowed them to do menu managementand nutritional evaluations. The menumodification demonstrations found thatthe lack of appropriate computersoftware limited the feasibility ofmonitoring the nutritional quality ofmenus. More recently developedsoftware has greatly enhanced theability to perform these analyses, whichwill now be supported by a USDAdeveloped data base. Schools withmicrocomputers should be able to usethis software, and may opt to use it toassist in food-based menu planning, forexample, to analyze the recipes of somepopular entrees.

The cost analysis found that thenutrient requirements can be met atabout the current cost of food in the

National School Lunch Program.Because the foods used in the marketimpact analysis were drawn from whatis currently being served, and variousadjustments in preparation practicesand frequency of food use can meet thefood component minimums andnutrient requirements, USDA does notanticipate the need for significantchanges in meal preparation practicesthat would affect the cost to preparemeals. The administrative cost ofconducting the proposed food-basedmenu planning should be about thesame as current operations once thesystem is fully implemented in a school.

In summary, since at the local levelschools should make reasonableeconomic decisions and this proposalserves to increase their options, theDepartment does not anticipateincreased local implementation cost dueto this proposal. At the Federal andState levels, there will be increased costto provide training and technicalassistance for an additional option andto implement systems for managementof this option in the event that somelocals select food-based menu planning,with the majority of this cost being Stateimplementation. The Federalcomponent of this will be coveredthrough revised budgeting for thefunding available for Dietary Guidelinesimplementation in FY 1995 andsubsequent years. At the State level, theinitial planning and set-up for thisadditional food-based menu planningoption is estimated to take about 80hours of staff time for each Stateadministrative unit (the time forongoing operation is addressed in thefollowing section). Therefore, at anestimated average rate of $25 per hour,the Department projects an average costof $2,000 per State for initial planningand set-up. This cost would be coveredby part of the savings from the reductionin administrative burden due to thepreviously proposed extension of thereview cycle from four to five years.

c. Ongoing Costs and Other SignificantEffects

Under this proposed rule, States willbe required to perform nutrient analysesas a routine component of reviews ofschool food authorities using the food-based menu planning system, increasingthe cost of ongoing programmanagement. It is estimated that onaverage an additional 12 hours will berequired for nutrient analysis for eachfood-based menu planning schoolreviewed. The actual total cost for thesereviews will vary depending upon thepercent of school food authoritiesselecting the food-based menu planningoption. Since this percentage is

unknown, a range of cost is projectedincluding the upper bound of 100percent. In consideration of thecomments received from the foodservice community, the lower boundhas been set at 25 percent. Given thisrange, and assuming an average rate of$25 per hour, the Department projectsan increase in national aggregate Stateongoing management cost for thesereviews of $0.4 to $1.7 million. Statescan reduce the percent of schools usingfood-based menu planning by providingenhanced levels of training andtechnical assistance for NSMP andAssisted-NSMP.

To provide for the resources needed,this proposal continues the twenty percent reduction in state monitoringrequirements previously proposed. Thisreduction will enhance the level ofresources available at the State level tofocus on training and technicalassistance efforts and nutrition reviewsof food-based menu planning systems.

While implementation will require adedicated effort on the part of theDepartment, the state agencies and localschool food authorities, the cost ofongoing operation and maintenance of afood-based menu planning system at thelocal level will be indistinguishablefrom the current meal pattern basedsystem.

d. BenefitsThe health benefits and value due to

risk reduction of improving schoolmeals to be consistent with theprinciples of the Dietary Guidelines forAmericans were discussed in the June10, 1994 cost/benefit assessment. Theaddition of the food-based menuplanning option retains the benefits aspreviously presented.

The SNDA study found that NSLPlunches significantly exceed the DietaryGuidelines recommendations for fat,saturated fat and sodium. Diet-relateddiseases accounted for almost 65percent of all deaths in the U.S. in 1991(National Center for Health Statistics,1993). About 300,000 deaths per year, orabout 14 percent of all deaths, has beenestimated as the lower bound for deathsdue to diet and activity patterns(McGinnis and Foege, 1993). Theprevious analysis concluded that if thereductions in fat and saturated fat intakeinstituted during the school years arecontinued into adulthood, the increasein life-years and the value in dollarsbased upon willingness to pay would beof a magnitude similar to or exceedingthat estimated for the Food and DrugAdministration (FDA) food labelingchanges, which were $4.4 to $26.5billion over 20 years. The lag time torealize this level of benefits over a 20


year period might be greater since FDA’sestimates apply to the U.S. adultpopulation and the proposed rule onschool meals will begin to have effectwith those children in school at the timeof implementation. Since the food-basedmenu planning option requires thatRDA and Dietary Guideline-basedcalorie and nutrient levels be provided,the health benefits should be the sameas those of NSMP and Assisted-NSMP.

References

Abt Associates, Inc. (1994). ‘‘School Lunchand Breakfast Cost Study.’’ Preparedunder contract to: USDA Food andNutrition Service.

Brewer, K.P., F.J. DeMicco and R.E. Conn(1993). ‘‘Computer Hardware andSoftware Use in School Food ServiceOperations.’’ School Food ServiceResearch Review, Volume 17, Number 2.

Mathematica Policy Research (1993). ‘‘SchoolNutrition Dietary Assessment Study.’’Prepared under contract to: USDA Foodand Nutrition Service.

McGinnis, J.M. and W.H. Foege (1993).‘‘Actual Causes of Death in the UnitedStates’’. Journal of the American MedicalAssociation, Nov. 10, 1993, Vol 270, No.16:2207.

National Center for Health Statistics (1993).‘‘Advance Report of Final MortalityStatistics, 1991’’. Monthly Vital StatisticsReport, Vol. 142, No. 2 (Supplement).

National Research Council (1989).Recommended Dietary Allowances, 10thEdition. National Academy of Sciences,National Academy Press.

USDA Food and Nutrition Service (1994).‘‘National School Lunch and SchoolBreakfast Program: Nutrition Objectivesfor School Meals; Proposed Rule.’’Federal Register, Vol. 59, No. 111 (June10, 1994).

USDA/DHHS (1990). ‘‘Nutrition and YourHealth: Dietary Guidelines forAmericans.’’ Third Edition. Home andGarden Bulletin No. 232.



Food and Consumer Service


National School Lunch Program andSchool Breakfast Program; Notice ofPublic Meeting

AGENCY: Food and Consumer Service,USDA.ACTION: Notice of public meeting.

SUMMARY: The Healthy Meals forHealthy Americans Act of 1994amended the National School LunchAct to require that meals served throughthe National School Lunch and SchoolBreakfast Programs comply with theDietary Guidelines for Americans

beginning no later than thecommencement of the 1996–97 schoolyear. Compliance with the DietaryGuidelines is to be achieved through avariety of meal planning approachesincluding ‘‘food-based menu systems.’’The food-based menu planning conceptis published elsewhere in today’sFederal Register. Further, the Actrequires that the Department conduct apublic meeting to discuss the proposedfood-based menu systems. This Noticeannounces the meeting.DATES: The meeting is scheduled forFriday, February 17, 1995, from 8:30a.m. to 1:00 p.m. Persons who cannotattend the meeting may submit writtencomments on the proposed regulation.To be assured of consideration,comments must be postmarked on orbefore March 13, 1995, and commentstransmitted via E-mail must be sent nolater than 5 p.m. Eastern Standard Timeon that same date.ADDRESSES: The meeting will be held inthe Williamsburg Room, Room #104A,Administration Building, USDA, 12thand Jefferson Drive, SW., Washington,DC 20250. Written comments should besent to: Mr. Robert M. Eadie, Chief,Policy and Program DevelopmentBranch, Child Nutrition Division, Foodand Consumer Service (FCS), USDA,3101 Park Center Drive, Alexandria,Virginia, 22302. Comments may be sentvia E-mail to: [email protected] comments are sent electronically,commenters should designate ‘‘receiptrequested’’ to be notified by E-mail thatthe message has been received byUSDA. Written submissions, themeeting transcript, and comment lettersmay be reviewed by the public in Room1007 in the Alexandria office of FCSlisted above during regular businesshours of 8:30 a.m. to 5 p.m., Mondaythrough Friday.FOR FURTHER INFORMATION CONTACT:William Wasserman, Food andConsumer Service, USDA, 3101 ParkCenter Drive, Alexandria, Virginia22302; (703) 305–2281.SUPPLEMENTARY INFORMATION: Thisaction is not a rule as defined by theRegulatory Flexibility Act (5 U.S.C.601–612) and thus is exempt from theprovisions of that Act. In accordancewith the Paperwork Reduction Act of1980 (44 U.S.C. 3507), no newrecordkeeping or reporting requirementshave been included that are subject toapproval from the Office of Managementand Budget.

The National School Lunch andSchool Breakfast programs are listed inthe Catalog of Federal DomesticAssistance under No. 10.553 and No.10.555, respectively, and are subject to

the provisions of Executive Order12372, which requiresintergovernmental consultation withState and local officials. (See 7 CFR part3015, subpart V, and the final rulerelated notice published at 48 FR 29112,June 24, 1983.)

Background

Section 112(c) of Public Law (Pub. L.)103–448, the Healthy Meals for HealthyAmericans Act of 1994, enacted onNovember 2, 1994, amended section 9 ofthe National School Lunch Act (NSLA),42 U.S.C. 1758(f), to require that theDepartment develop ‘‘food-based’’systems for school food authorities touse in planning and preparing mealsserved under the National School LunchProgram (NSLP) and School BreakfastProgram (SBP). Section 106(b) of Pub. L.103–448 also amended section 9 of theNSLA, 42 U.S.C. § 1758(f)(2)(A), torequire that school meals meet theDietary Guidelines for Americans byJuly 1, 1996, unless the State agencypermits later implementation.

Section 112(c)(2) of Pub. L. 103–448(42 U.S.C. § 1760(k)(2)) also requiresthat the Department hold a publicmeeting to ‘‘discuss and obtain publiccomments on the proposed rule’’ notlater than 45 days after the publicationof the proposed regulation. Thelegislation states that the meeting shallbe held with, among others,representatives of affected parties, suchas program administrators, school foodservice personnel, parents, and teachers.Further, the legislation mentionsinclusion of organizations, such aspublic interest antihunger organizations,health and consumer groups, foodmanufacturers and vendors, andnutritionists.

In addition to this Notice, theDepartment is issuing invitations toorganizations and individuals who mayhave an interest in this proposal. Amongthose specifically invited are theAmerican School Food ServiceAssociation, National PTA, Public Voicefor Food and Health Policy, AmericanHeart Association, American DieteticAssociation, Center for Science in thePublic Interest, the American Academyof Pediatrics, and the NationalEducation Association, as well asorganizations representing major foodmanufacturers or vendors that sell foodproducts to the school meal programs.In addition to hearing comments frominvitees, one hour will be reserved atthe close of the meeting for observerswho, on a first-come, first-serve basisand subject to time limits, wish topresent their comments. Writtenmaterial will also be accepted from


participants and observers who want toprovide additional information.

An official transcript plus anyadditional material submitted through

this public meeting will be consideredin development of the final regulationson nutrition standards and menuplanning approaches.

Dated: January 18, 1995.William Ludwig,Administrator, Food and Consumer Service.[FR Doc. 95–2045 Filed 1–26–95; 8:45 am]BILLING CODE 3410–30–U

fede

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egiste

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5529


Part V

Department ofHealth and HumanServicesFood and Drug Administration

21 CFR Part 20Public Information; Communications WithState and Foreign Government Officials




21 CFR Part 20

[Docket No. 94N–0308]

Public Information; CommunicationsWith State and Foreign GovernmentOfficials

AGENCY: Food and Drug Administration,HHS.ACTION: Proposed rule.

SUMMARY: The Food and DrugAdministration (FDA) is proposing toamend its regulations governingcommunications with officials of Stateand foreign governments. This proposalwill permit FDA to disclose to, andreceive from, these officials certainnonpublic information without beingcompelled to disclose the information tothe public generally. This proposaladdresses the nonpublic exchange oftwo types of information. First, it allowsthe disclosure of nonpublic safety,effectiveness, or quality informationconcerning FDA-regulated products toState government officials. Second, itallows the disclosure of draft proposedrules and other nonpublic predecisionaldocuments concerning regulatoryrequirements or activities between FDAand either State or foreign governmentofficials. This action is necessary toenhance cooperation in regulatoryactivities, to eliminate unfoundedcontradictory regulatory requirements,and to minimize redundant applicationof similar requirements.DATES: Written comments by April 27,1995. FDA is proposing that any finalrule that may issue based on thisproposal become effective on or beforeFebruary 27, 1995.ADDRESSES: Submit written commentsto the Dockets Management Branch(HFA–305), Food and DrugAdministration, rm. 1–23, 12420Parklawn Dr., Rockville, MD 20857.FOR FURTHER INFORMATION CONTACT:Linda R. Horton, International PolicyStaff (HF–23), Food and DrugAdministration, 5600 Fishers Lane,Rockville, MD 20857, 301–443–2831.SUPPLEMENTARY INFORMATION:

I. Background

Historically, FDA’s communicationswith State and foreign governmentofficials generally had the same status ascommunications with any member ofthe public. Under FDA’s rules as theywere originally published in 1974,under many circumstances, the

disclosure of agency records by FDA tosuch government officials constituteddisclosure to the public and obligatedFDA to make the same records availableto the public upon request. As discussedbelow, however, there have been certainlongstanding exceptions to this generalrule of uniform access.

FDA is a strong supporter of thepublic’s ‘‘right to know’’ aboutgovernment actions and public access toofficial information. There are times,however, when public disclosure ofinformation will undermine otherlegitimate private rights and governmentresponsibilities. In drafting the Freedomof Information Act (the FOIA) (5 U.S.C.552), Congress recognized the need forthe Federal government to be able towithhold certain categories ofinformation from public disclosure.Examples of such categories of recordsrelevant to FDA include:

1. Trade secret and confidentialcommercial information to protectintellectual property rights and researchincentives (5 U.S.C. 552(b)(4));

2. Predecisional documents to protectthe deliberative process (5 U.S.C.552(b)(5));

3. Information the disclosure of whichmay invade personal privacy (5 U.S.C.552(b)(6)); and

4. Investigatory files compiled for lawenforcement purposes to protectinvestigations into misconduct (5 U.S.C.552(b)(7)).

Since 1974, significant changes in theworld economy and in the activities ofthe regulatory agencies of the world’sgovernments have caused FDA to workmore closely with other governmentofficials (i.e., local, State, and foreignofficials, as well as fellow Federalofficials) as professional colleagues inthe attempt to find solutions to publichealth and consumer protectionproblems.

Increased international commerce anddiminished resources for regulationhave resulted in efforts by public healthregulatory agencies around the globe toenhance the effectiveness and efficiencyof their operations. Public healthregulatory agencies are protecting thepublic by harmonizing regulatoryrequirements; minimizing duplicativeregulations; and cooperating inscientific, regulatory, and enforcementactivities. Similar factors havedemanded enhanced cooperation amongall levels of government within theUnited States. To facilitate thesenational and international cooperativeactivities, regulatory agencies, bothwithin the United States andworldwide, have taken steps to increasecommunications with their counterpartswhen developing proposed regulations

or formulating important regulatorydecisions. These discussions occur notonly with respect to FDA-regulatedproducts, but in other areas wherecooperation is essential, e.g., aircraftsafety, pesticide registration, andnuclear power regulation.

An example of the trend towardincreased international informationsharing is the 1993 revision to FDA’spublic information regulations, § 20.89(21 CFR 20.89), providing that, underspecified conditions, FDA may disclosecertain nonpublic safety, effectiveness,or quality information concerning FDA-regulated products to foreigngovernment officials without beingcompelled to disclose the information tothe public (58 FR 61598, November 19,1993). In this document, FDA isproposing a regulation authorizingdisclosure of certain nonpublic safety,effectiveness, and quality information toState government officials to parallel theexisting regulation for disclosure of thiskind of information to foreigngovernment officials. The purpose ofthis action is to enhance Federal-Statecooperation in regulatory activities. Inthis document, the term ‘‘Stategovernment officials’’ can include localofficials, because local governments arethe legal instruments of the States.However, FDA generally works withState, not local governments, andinformation exchange with Stateofficials is the more common situation.

FDA is also proposing to exchange(i.e., to disclose, to receive, or to doboth) certain nonpublic predecisionaldocuments concerning FDA’s or anothergovernment’s (local, State, or foreign)regulations, requirements, or activitieswithout being compelled to generallydisclose the information to the public.The purpose of this action is to facilitatethe elimination of unnecessary,contradictory regulatory requirementsand to minimize unwarranted,redundant application of similarrequirements by multiple domestic andforeign regulatory bodies. Further, thisproposed action is intended to enhanceFDA’s implementation, consistent withthe laws it administers, of U.S. policiesand obligations resulting from ourcountry’s duties under internationalagreements. FDA believes both changesproposed in this document will enhanceconsumer protection and increaseconsumer access to safe, effective, andhigh quality products that are regulatedby FDA.

A. Disclosure of Information to the Public:General Statutory and Regulatory Provisions

FDA’s regulations governing publicinformation in part 20 (21 CFR part 20)implement the FOIA, 5 U.S.C. 552, and


other laws that affect public access togovernment records and information(e.g., the Trade Secrets Act (18 U.S.C.1905) and section 301(j) of the FederalFood, Drug, and Cosmetic Act (the act)(21 U.S.C. 331(j)). Section 20.21 ofFDA’s public information regulationsstates a general rule that any record ofthe agency that is disclosed in anauthorized manner to any member ofthe public is available for disclosure toall members of the public. As statedearlier, communications by FDA withState and local government officials andwith foreign government officialsgenerally have had the same status ascommunications with any member ofthe public.

However, subpart E of part 20identifies several categories of officialsor institutions to whom, under specifiedlimitations, disclosure of certain FDArecords may be made without requiringuniform access under § 20.21. Theseinclude State and local governmentofficials, under limitations specified in§ 20.88, and foreign governmentofficials, under limitations specified in§ 20.89. FDA believes that consumerprotection will be enhanced if FDA isable to exchange information with othergovernment agencies at an earlier stagethan is possible under present rules, andif FDA is able to share with theseofficials certain categories ofinformation that may not be exchangedunder present rules. FDA furtherbelieves that protection of intellectualproperty rights, research incentives,deliberative processes, and similarimportant needs will not becompromised if certain conditions aremet by the recipients of suchinformation.

B. Exchanging Confidential CommercialInformation With State and LocalGovernment Officials: Statutory andRegulatory Provisions

Special provisions of the act and FDAregulations permit FDA to treat Stateand local government officialscommissioned by FDA or under contractwith FDA essentially as FDAemployees. The act authorizes theSecretary of the Department of Healthand Human Services (HHS) to conductexaminations and investigations for thepurposes of the act through employeesof HHS or through any health, food, ordrug officer or employee of any State,territory, or political subdivisionthereof, commissioned by the Secretaryas an officer of HHS (21 U.S.C. 372(a)).This authority has been delegated toFDA (21 CFR 5.10(a)). To facilitateimplementation of this provision,§ 20.88(a) provides that a State or localgovernment official commissioned by

FDA under 21 U.S.C. 372(a) shall havethe same status with respect todisclosure of FDA records as any specialgovernment employee under Federalpersonnel law.

These provisions allow thesecommissioned officials to reviewconfidential FDA investigative files andproposed policy statements thatnormally must be restricted to Federalemployees. FDA’s ability to solicit theadvice and tap the expertise of its Stateand local colleagues without publiclydisclosing investigational informationoutside the agency is a major advantageof the State Commissioning Program.The same rationale supports abroadening of FDA’s ability to shareinformation with other State employees.

FDA’s current regulations alsoprovide that communications with Stateand local government officials withrespect to law enforcement activitiesundertaken pursuant to a contract withFDA shall be subject to the same rulesthat protect FDA investigatory recordsfrom public disclosure. (See § 20.88(b)).Under existing § 20.88, however,communications by FDA with State andlocal government officials who areneither commissioned by FDA under 21U.S.C. 372(a), nor under FDA contract,have the same status as communicationswith any member of the public.Although § 20.88(c)(1) does provideadditional protection for investigatoryrecords and trade secrets andconfidential commercial informationthat have been voluntarily disclosed toFDA as part of cooperative lawenforcement and regulatory efforts bysuch noncommissioned and noncontractState and local government officials, theexisting regulation does not allow FDAemployees to reciprocate with respect toconfidential commercial information.FDA may not disclose to noncontractand noncommissioned State officialsconfidential commercial informationsubmitted to or incorporated intorecords prepared by FDA. Under currentregulations, such disclosure wouldinvoke the uniform access to recordsrequirement in § 20.21, and triggerpublic availability of this information.

With respect to investigatory recordscompiled for law enforcement purposes,FDA’s rules have long provided theagency with authorization to exchangesuch investigatory records with State orlocal government officials who performcounterpart functions to FDA at theState or local levels as part ofcooperative law enforcement efforts.(See § 20.88(c)). Such an exchange doesnot invoke the uniform access ruleestablished by § 20.21. FDA is proposingto expand the categories of informationsubject to this approach in order to

enhance Federal-State efforts to protectthe public health.

C. Exchanging Confidential CommercialInformation With Foreign GovernmentOfficials: Recent Changes in RegulatoryProvisions

When FDA’s regulations governingexchange of information with foreigngovernment officials were first codified,national economies worldwide weremore independent of one another thannow, and regulatory agencies worldwidedischarged their responsibilities moreindependently of one another. Even in1974, however, the importance of thoserelationships to the public health andthe mission of FDA was clear to theagency. In the preamble to the proposedregulations, the Commissioner of Foodand Drugs emphasized ‘‘the importanceof maintaining good workingrelationships with counterpart agenciesthroughout the world both to sounddiplomatic relations with foreignnations and to the availability ofimportant new information of regulatorysignificance. Such cooperation isencouraged by sections 301 and 308 ofthe Public Health Service Act (42 U.S.C.241 and 242f). Unless regulatoryinformation can be exchanged withoutrequired public disclosure, FDA willlose its sources of important informationthat are vital to protect the public, andwill be unable to disseminatepreliminary information when it is firstgenerated within this country in orderto help protect the public healththroughout the world.’’ (See 39 FR44602 through 44621, December 24,1974).

Although the agency at that timedeclined to implement the suggestionsof foreign governments that FDAexchange nonpublic safety andeffectiveness data with counterpartofficials, the Commissioner’s responseto those suggestions was at leastpartially based on the belief that theregulations proposed in 1974 would‘‘adequately satisfy the need forinternational exchange of importantregulatory information of this type.’’(See 39 FR 44602 at 44636 and 44637).

In the intervening 20 years there havebeen great changes in the worldeconomy and the working relationshipsof regulatory agencies around the globe.Experience has shown that efficient andeffective regulation can be facilitated bythe exchange of confidential commercialinformation between governments.Cooperation in review of productapproval applications is one example ofthe benefit such exchange can bring toconsumers and to industry.

In 1992, FDA proposed to amend§ 20.89 to expand the exchange of


information with foreign officials toinclude certain confidential commercialinformation, such as studies supportingproduct approval (57 FR 61598, June 26,1992). The agency issued a final rule onNovember 19, 1993 (58 FR 61598).Section 20.89 as amended allows theagency, under specified conditions, todisclose confidential commercialinformation such as nonpublic safety,effectiveness, or quality informationconcerning FDA-regulated products toforeign government officials whoperform counterpart functions, withoutcompelling the public disclosure of theinformation. The rule coversconfidential commercial informationsubmitted to the agency, or incorporatedinto agency-prepared records, as part ofcooperative law enforcement orregulatory efforts. Under the amendedregulation, several conditions must bemet before FDA may disclose theinformation to the foreign governmentofficial. The conditions are the same asthose proposed below with respect toanalogous disclosures to State and localgovernment officials.

One condition requires the foreigngovernment agency to provide a writtenstatement certifying its authority toprotect the information from publicdisclosure and its commitment not todisclose the information without thewritten permission of the sponsor orwritten confirmation from FDA that theinformation no longer has confidentialstatus. FDA requires this writtenstatement to: (1) Include specifiedlanguage; (2) bear the signature, name,and title of the responsible foreigngovernment official; and (3) besubmitted to FDA after the official isinformed about the significance theagency attaches to the confidentiality ofthe information and understands thatdisclosure by the foreign governmentcould constitute a criminal violationand would seriously jeopardize anyfurther interaction between FDA and theforeign counterpart agency.

As discussed in the preamble to the1993 final rule, that rulemaking wasundertaken because FDA concluded thatit needed to revise its publicinformation regulations to disclose toforeign government officialsconfidential commercial informationsubmitted to FDA or incorporated intoagency-prepared records in order toprovide clear authority for cooperationin reviews of pending submissions andother important international exchangesof regulatory information. The 1993final rule facilitates the approval ofproducts that are shown to be safe andeffective, expedites the withdrawal ofapproval of products that are found notto be safe and effective, and enhances

the efficiency of FDA’s enforcementefforts, while providing safeguardsagainst public disclosures of proprietaryinformation and conflicts of interest.

D. The Need to Extend to State GovernmentOfficials the Recent Changes in Provisions forExchanging Confidential CommercialInformation With Foreign GovernmentOfficials

FDA and State agencies workcooperatively and in a complementarymanner to protect the nation’s publichealth with regard to FDA-regulatedconsumer products. While Statesusually defer to FDA to approve themarketing of FDA-regulated products,some States actively regulate or monitor,within their State and under their ownauthorities, the clinical trials of someinvestigational new drugs, biologicproducts, and medical devices. Inaddition, most States have activeenforcement programs, especially forfoods.

FDA needs to be able to exchangeinformation with State or local officials,without being limited to those who arecommissioned or are under contractunder § 20.88(a) and (b), FDAcommissions State government officials,or enters into contracts with Stateagencies, primarily for the performanceof cooperative regulatory work.However, certain cooperative efforts aremore dependent on informationexchange followed by coordinationbetween Federal and State authorities,rather than on actual work performed byState authorities on behalf of Federalprograms. In some regulatory effortswhere the need for informationexchange is paramount, FDA may beable to rely on FDA commissioned andcontract employees in order to shareconfidential commercial information inthe possession of FDA that is necessaryto accomplish the agency’s publichealth mission. But, as discussed below,commissioning and contracting, whichare essential prerequisites under thecurrent regulation, consume inordinatetime and human resources and are notsuited to dealing with informationexchanges on rapidly developingproblems.

Arrangements for issuingcommissions are handled by Statecommission liaison officers located inFDA’s regional offices. Thecommissioning process includesidentifying suitable candidates (whichoften will require that supervisors orState agency heads also becommissioned), reviewing thecandidates’ qualifications to carry outactivities specified in the commission,issuing certificates and credentials, andaccounting for the credentials on a

periodic basis. FDA’s experience hasbeen that this mechanism is toorigorous, costly, and time-consuming toenable the rapid exchanges ofconfidential information with Stategovernment officials that are essential inpublic health emergencies andinvestigations. Furthermore, the Stategovernment official who iscommissioned, and therefore permittedaccess to confidential commercialinformation in FDA’s possession, isfrequently not the employee who, in anyparticular case, is best capable ofanalyzing or evaluating the nonpublicinformation.

Similarly, contracting projects are notsuited for cooperative Federal-Stateregulatory efforts requiring rapidexchange of information. Contracts aresolicited, negotiated, and put in placeaccording to formal U.S. Governmentcontracting procedures; for continuingwork, contracts must be renewedannually. In addition to being time-consuming to establish, contracts cannotbe relied upon to cover all FDA programareas. The services most commonlyprocured by FDA through contracts withthe States are for establishmentinspections, with related collection andanalysis of samples, report preparation,and followup activity undertaken by theState agency under its own authorityand program. FDA program areas are notcovered uniformly across the States,with FDA having contracts in many (butnot all) States for food inspections, butin only a few States for drug, biologicproduct, and medical deviceinspections.

The following are examples ofsituations in which the ability to shareconfidential commercial informationwith State governments in a lessencumbered manner would haveallowed more timely review ofsignificant public health issues, orwould have enhanced the effectivenessof regulatory activities:

1. FDA and some States acquireinformation from ongoing clinicalinvestigations of new drugs, biologicproducts, or medical devices, includingunanticipated adverse reaction or devicemalfunction data, clinical protocols,identities of study sites, and names ofclinical investigators. When problemsoccur that could have an impact uponthe safety of study subjects, publichealth decisions concerning thecontinuation of the study must be basedupon the most complete informationpossible. This is facilitated by access torecords at the study sites, and in certainsituations it would be consistent withpublic health protection for Stateofficials to have access to records that


FDA must evaluate in its review of theproblem.

Under the existing regulations, Stategovernment officials can shareinformation that they receive or acquirewith FDA. However, becauseinformation concerning investigationaldrugs and medical devices is oftenconfidential commercial information,FDA cannot reciprocate, unless the Stateofficials are commissioned or undercontract for law enforcement purposes.As explained above, the processes forissuing commissions to Stategovernment officials or placing themunder contract are so cumbersome andtime-consuming as to impede jointFederal-State efforts on clinical trials inprogress that require a two-wayexchange of relevant information. Suchrestrictions on the exchange of thisinformation can hinder decisionmaking,for both FDA and State governments,where timeliness is important toprotecting public health.

Further, State governments, onoccasion, have not had ready access toinformation about pending FDAregulatory actions concerning clinicaltrials in progress that may involvehealth care institutions or individualswhich operate under State licenses,permits, or registrations. In suchcircumstances, the current impedimentsto full-information exchanges thwarteffective, coordinated regulatorysolutions to public health problems. Forexample, in the case of NarcoticTreatment Programs (NTP’s), FDAcoordinates actions with the Stateagencies charged with regulating thesetypes of clinics. Such coordination isessential because if FDA plansenforcement action that would close aprogram, the assistance of the Stateagencies is necessary to minimizedisruption to the treatment of patients.The rapid exchange of nonpublicinformation can also enhance protectionof the public health when a State hasbroad authority to require an unsafe orviolative establishment within itsborders to cease operations.

2. Both FDA and State agencies haveresponsibilities for Institutional ReviewBoards (IRB’s), which are the boards orcommittees formally designated byinstitutions to review, to approve theinitiation of, and to conduct periodicreview of, biomedical researchinvolving use in human subjects ofFDA-regulated products (21 CFR§ 56.102(g)). In the case of noncompliantIRB’s, FDA regulations allow the agencyto notify relevant State and Federalregulatory agencies and other partieswith a direct interest about any actionFDA may take against the IRB or itsparent institution (21 CFR 56.120). In

some instances, State action againstviolations may be preferable to Federalaction, or a State may have authority toexpeditiously revoke the license of aprogram or clinic operating under thatviolative IRB. However, State officialsmay need access to confidentialinformation about the protocol orinvestigational product, includingnonpublic confidential commercialinformation contained in IND’s andNDA’s, in order to take effective action.This proposed rule would permit FDAto share such information, where theagency, in its discretion, believes it isappropriate.

3. Health fraud enforcement ofteninvolves several agencies or officials atboth the Federal and State governmentlevels. At the outset of a case, theinvolved State officials may becommissioned by FDA or under contractto FDA and, therefore, have access torelevant confidential commercialinformation in FDA records. However,as evidence is gathered and the casedevelops, a point is reached whenenforcement strategy must be discussedwith other State government officials,who seldom hold FDA commissions orare under contract. Under the currentregulations, these State governmentofficials may not have access topertinent information from FDArecords, including information about theidentity of investigational products ordistribution data that may bear on thecase. In such circumstances, the processof investigating and prosecuting the caseis frustrated and delayed. That delayand the resulting harm to specificinvestigations are aggravated in caseswhere a perpetrator may be operating inseveral States.

In one particular case, a State officialresponsible for issuing and revokingmedical licenses requested reportscovering FDA investigations of healthfraud by a physician who was illegallyimporting and distributing unapproveddrugs. The State was initiating a licenserevocation proceeding. Because thecurrent version of § 20.88 makesdisclosure to a noncommissioned ornoncontract State employee a publicdisclosure, the records provided by FDAhad to be purged of information vital tothe State’s revocation case.Consequently, action to protect thepublic health in this instance wasimpeded by FDA’s inability to disclosenonpublic information to theappropriate State official in a timelymanner.

4. Data in FDA’s possession about thedistribution of an imported product maycontain confidential commercialinformation. Many imported productscan be tracked by State officials more

economically and efficiently than byFDA officials, because the tracking canbe done in the course of regular Stateinspectional activities. Under currentregulations, FDA’s authority to disclosenonpublic information about consigneesto State government officials forfollowup action, such as embargo ofviolative products, is limited.

A common element of these examplesis that joint FDA and State governmentefforts on significant public healthissues, including effective regulatoryactivities, have been encumbered byexisting regulatory restrictions on FDA’sability to exchange confidentialcommercial information with Stategovernments. The amendment beingproposed would facilitate suchdisclosures and thereby contribute toeconomy of effort, efficient use of publicresources, and enhanced public healthprotection.

Additionally, FDA believes it shouldhave the ability to disclose proprietaryinformation to State governmentscientists visiting FDA as part of a jointreview or long-term cooperative trainingeffort authorized under section 708 ofthe act (21 U.S.C. 379), pursuant to thesame procedures FDA recentlypromulgated for visiting foreignscientists. Efficient publicadministration requires that FDA beable to deal with visiting Stategovernment scientists in the samemanner as it does with visiting foreigngovernment scientists.

This proposed rule, therefore, wouldprovide, through an amendment to§ 20.88, the same mechanisms forexchanges of confidential commercialinformation between FDA and Stategovernment officials as were recentlyprovided for foreign governmentofficials through an amendment to§ 20.89. Under the proposedamendment, several conditions must bemet prior to FDA’s disclosure of suchinformation to State governmentofficials.

First, the State government agencymust provide a written statementcertifying its authority to protect theinformation from public disclosure andits commitment not to disclose theinformation without the writtenpermission of the sponsor or writtenconfirmation from FDA that theinformation no longer has confidentialstatus. Second, FDA must make one ormore of the following determinations:(1) The sponsor of the productapplication has provided writtenauthorization for the disclosure; (2)disclosure would be in the interest ofpublic health by reason of the Stategovernment’s possessing informationconcerning the safety, effectiveness, or


quality of a product or informationconcerning an investigation; or (3) thedisclosure is to a State governmentscientist visiting FDA on the agency’spremises as part of a joint review orcooperative training effort, and FDA (a)retains physical control over theinformation, (b) requires a writtencommitment to protect theconfidentiality of the information, and(c) implements specific conflicts-of-interest safeguards.

E. Cooperation and Harmonization Needs forExchanging Nonpublic PredecisionalDocuments and Other Nonpublic InformationWith State and Foreign Government Officials

FDA is committed to cooperation withcounterpart officials in State and foreigngovernments. Because public healthproblems respect neither Stateboundaries nor international borders,such cooperation is essential toconsumer protection.

If FDA can provide foreigngovernment officials with informationon impending new or changedregulations and other requirements oractivities, the agency can encourageadoption of uniform science-basedmeasures that fully protect consumers,and can help reduce both duplication ofregulatory activities and unfounded orcontradictory regulatory requirements.FDA likewise benefits from the ability toreceive drafts of proposed regulationsfrom foreign and State governmentofficials without being required todisclose these drafts to an FOIArequester because the risk of such publicdisclosure frequently inhibits foreignand State counterparts from fulldisclosure of useful information to FDA.For continuity in regulatoryharmonization efforts at all levels ofgeopolitical organization (State,national, and international), FDA mustbe able to more freely communicate onregulatory matters and initiatives withcounterpart government officials.

The following are examples ofsituations in which the ability toexchange nonpublic predecisionaldocuments with State and foreigngovernment counterparts wouldimprove Federal-State uniformity andfacilitate global harmonization ofregulatory requirements.

1. Information exchange between FDAand its foreign government counterpartsis necessary in order to utilize thetechnical expertise of other regulatoryagencies for purposes of harmonizingregulations and regulatory activities.Current increases in worldwide trade, aswell as recent trade agreements, addimpetus to harmonization activitiesalready underway. For example, FDAwanted to, but could not, disclose to

foreign counterpart officials at 1993international meetings, the drafts of itsproposed rules on medical device goodmanufacturing practices (published inthe Federal Register of November 23,1993 (58 FR 61952)), and on regulationsof seafood safety through HazardAnalysis Critical Control Points(HACCP) (published in the FederalRegister of January 28, 1994 (59 FR4142)). FDA believes its harmonizationand rulemaking activities in these areaswould be enhanced by nonpublicexchange of such draft proposals.

2. The Food Code, published in theFederal Register of January 28, 1994 (59FR 4085), consists of modelrequirements to safeguard public healthand assure that food is unadulteratedand honestly presented when offered toconsumers. The Food Code was offeredas a model for local, State, and Federalgovernmental jurisdictions to adoptunder their own authorities asregulations for food service, retail foodstores, or food-vending operations.Because concerns about confidentialitylimited FDA’s ability to exchangepredecisional documents, access todevelopmental materials and drafts waslimited to State government officialswho were commissioned by FDA.Consequently, it was difficult for FDA toget technical contributions andprofessional views from the reservoir ofexpertise among many other Stateofficials. FDA believes this limitation onnonpublic exchange is detrimental toFederal-State cooperation. By its verynature, the Food Code is central topublic health programs of Federal, State,and local government organizations. Assuch, FDA would have preferred toshare developmental materials anddrafts with a spectrum of Stategovernment officials to assureparticipation in the development of thedocument by some of the officials whowill rely on it in the course of theirongoing work.

3. The successful development andimplementation of a comprehensivefood safety strategy, beyond the programfor seafood safety, will depend on ajoint effort between FDA and Stategovernment officials. FDA’s decisionswould benefit greatly from exchange oftechnical expertise and professionalviews at all stages in the developmentof a strategy. The importance of Stategovernment input and partnership isunderscored by the fact that, while FDAregulatory authority is very broad, inpractice many phases of foodproduction and distribution areregulated principally by State or localgovernments.

4. Some aspects of the NutritionLabeling and Education Act (the NLEA)

address consumer issues thattraditionally have been addressed byState governments in food label review,e.g., content descriptors, net weightdeclarations, and other elements thatcould relate to economic deception.Congress intended, and FDA desires,that there be a partnership between FDAofficials and their State governmentcounterparts in the education andenforcement aspects of this legislation.However, although FDA has been ableto involve State government officialswho hold FDA commissions in strategydiscussions, the agency has not beenable to utilize the broader base ofexpertise that resides throughout Stategovernments. Further, although theNLEA empowers the States to takeaction under the authority of the act,and requires the States to notify FDAprior to initiating any action, it requiresthe sharing of only very basicinformation. Enhanced ability toexchange nonpublic informationbetween FDA and State governmentofficials will facilitate enforcement ofthe NLEA.

5. The Mammography QualityStandards Act of 1992 (the MQSA),which is now being implemented, posesmany challenges with regard to Federal-State cooperation and coordination. TheMQSA calls for FDA to delegate theMQSA authority to States that meetcertain requirements, and for FDA toprovide oversight to ensure that Statesfulfill their responsibilities. Oneobjective of the MQSA is to maintain acertain consistency of standards acrossState programs. Like the Federalgovernment, States establishing newprograms and standards are bound byadministrative rulemaking processes,and will want to undertake thoserulemakings as soon as possible. So longas FDA’s regulations limit the nonpublicexchange of draft regulations, Statesmay draft rules that will turn out to beinconsistent with FDA’s. Thatinconsistency may delay and frustrateimplementation of the provisions of theMQSA that are intended to encourageState involvement in programs to assurequality mammography. If FDA and Stateofficials could exchange draftregulations at all stages of the process,States could propose regulations thatwere consistent with Federal regulationswithin coordinated timeframes.

The enforcement and sanctionsprocesses for the MQSA also posechallenges to Federal-State cooperationand coordination. There areapproximately 11,300 facilities to beinspected, only about 30 percent ofwhich will be inspected by FDA.Strategies for inspection priorities andFederal-State uniformity in the


application of enforcement actions andsanctions will be very important. If FDAcannot easily exchange nonpublicinformation with State governmentofficials, cooperative efforts may be lesseffective.

F. Summary of Background

Exchanges of nonpublic informationthat meet the conditions established inthe proposal will facilitate Federal-Stateuniformity and internationalharmonization in order to maximizeconsumer protection and minimize thepossibility that unnecessarily disparatemeasures will be adopted on aparticular issue. In order to enhanceeffective regulatory activities andexpeditious review of significant publichealth issues, FDA has concluded thatit needs the ability, in selectedcircumstances, to disclose confidentialcommercial information to Stategovernment officials, just as it earlierdetermined that it may be necessary attimes to disclose such information toforeign government officials.Furthermore, in order to prepare newregulations or modify existingregulations, issue technicalrequirements, or undertake a variety ofother activities, FDA may need toexchange draft proposals withcounterpart State government or foreigngovernment officials in the same way itexchanges similar information withother U.S. government agencies.Federal-State uniformity andinternational harmonization arefacilitated when such exchanges cantake place at early stages undercircumstances that allow the frankexchange of views among technicalexperts. FDA’s experience over the lastdecade has convinced the agency thatforeign and State government technicaland scientific staff perform the sameadvisory function, in many instances, asother agency employees and that therecommendations of such experts areimportant to effective decisionmaking.

Of course, any information providedby State or foreign government officialsupon which FDA is relying in proposinga new regulation or proposed change inexisting regulations would be includedin published proposals or final rules inaccordance with the AdministrativeProcedure Act (5 U.S.C. 553). Thegeneral public will have ampleopportunity to comment on suchproposals and their bases at that time.FDA also emphasizes that disclosures toforeign and State counterparts underfinal regulations based on theseproposals would not be a routineoccurrence, but would occur only inlimited situations.

II. Proposed Amendments

A. The Proposal to Extend to StateGovernment Officials the Recent RegulatoryProvisions for Exchanging ConfidentialCommercial Information With ForeignGovernment Officials

Proposed § 20.88(d) covers thenonpublic disclosure of certaininformation that is protected frommandatory public disclosure byexemption 4 of the FOIA, 5 U.S.C.552(b)(4) to State government officials.Exemption 4 covers two broadcategories of information in Federalagency records: Trade secretinformation, and information that is: (1)Commercial or financial, (2) obtainedfrom a person, and (3) privileged orconfidential (‘‘confidential commercialinformation’’).

Trade secret information has beendefined by the courts as informationrelating to the making, preparing,compounding, or processing of tradecommodities (Public Citizen HealthResearch Group v. FDA, 704 F.2d 1280,1288 (D.C. Cir. 1983)). This definition,which requires a ‘‘direct relationship’’between the trade secret and theproductive process, applies to arelatively narrow category ofinformation that coincides withinformation prohibited from disclosureunder section 301(j) of the act (21 U.S.C.331(j)). FDA recently amended § 20.61to reflect this definition (59 FR 531,January 5, 1994). That amendment waspart of an update of the agency’s FOIAregulations to reflect changes that wererequired by the 1986 amendments to theFOIA and which have already been putinto practice by the agency. Theamended definition of ‘‘trade secret’’ inpart 20 is a restatement of the standardestablished by Public Citizen HealthResearch Group, and puts the definitionin conformity with applicable case lawand with HHS’s FOIA regulations.Because FDA’s practice has been inaccordance with the judicial standardsthat resulted from Public Citizen HealthResearch Group and with thedefinitions established by HHS, theamendment to § 20.61 did not alter theagency’s practice in any way or theexpectations of the public or regulatedindustry concerning FDA’s treatment ofparticular types of information.

Nor will the proposed amendment to§ 20.88 alter FDA’s existing practicewith respect to the narrow category ofinformation that can be considered‘‘trade secret.’’ The proposedamendment to § 20.88 expresslyexcludes the disclosure of informationthat would fall into the trade secretcategory to State government officials,without the express authorization of the

submitter. The only exception is thatState scientists visiting FDA as part ofa joint review or long-term trainingeffort authorized under section 708 ofthe act (21 U.S.C. 379) may, underadditional safeguards specified in therule, be allowed access to suchinformation.

It has been an agency practice todisclose confidential information,including trade secret information, tovisiting government scientists insofar asthat access is authorized underconfidentiality agreements for a trainingor joint review activity under section708 of the act and § 20.90. Thisproposed rule (§ 20.88(d)(1)(ii)(C))codifies the procedures for providingaccess to such information in the ruleon exchanging information with Stategovernment officials rather thancontinuing this practice under the moregeneral § 20.90 procedures.

The principal focus of this part of theproposed rulemaking is the disclosureto State government officials of the othercategory of information covered byexemption 4 of the FOIA, ‘‘confidentialcommercial information,’’ includingagency-prepared reviews of suchinformation, and records that includesuch information. Commercial orfinancial information that a person isrequired to provide FDA is‘‘confidential’’ for purposes ofexemption 4 if disclosure of theinformation is likely to: (1) Impair theGovernment’s ability to obtain necessaryinformation in the future or (2) causesubstantial harm to the competitiveposition of the person from whom theinformation was obtained. (See CriticalMass Energy Project v. NRC, 975 F.2d871, 877–880 (D.C. Cir. 1992) (en banc),cert. denied, 113 S.Ct. 1579 (1993);National Parks and ConservationAssociation v. Morton, 498 F.2d 765,770 (D.C. Cir. 1974).) Commercial orfinancial information that is provided toFDA on a voluntary basis is‘‘confidential’’ if it is of a kind that theprovider would not customarily releaseto the public. (See Critical Mass EnergyProject at 880). The types of informationthat may be exempt from publicdisclosure pursuant to this section ofthe FOIA include: Business salesstatistics, customer and supplier lists,research data, profit and loss data, andoverhead and operating costs. Undermany circumstances, FDA also treatsdata supporting product approvalsubmissions as confidential commercialinformation that is entitled to beprohibited from public disclosure. Thus,under the amended regulation,confidential commercial informationsubmitted to the agency that could bedisclosed to State governments would


include information (other than tradesecret information prohibited fromdisclosure under section 301(j) of theact) in pending and approvedsubmissions for permission to performstudies on or to market regulatedarticles such as new drugs, new animaldrugs, medical devices, and biologicalproducts, and information in agency-prepared reviews of such submissions.

The proposed amendment to § 20.88would establish that State governmentofficials are not members of the publicfor purposes of disclosure ofconfidential commercial informationsubmitted to FDA or incorporated intorecords prepared by the agency, and thatsuch disclosures would not invoke therequirements in § 20.21 of uniformaccess to records. Disclosure ofconfidential commercial information toState government officials pursuant tothe proposed amendment would be an‘‘authorized’’ disclosure. Accordingly,no FDA employee engaged in such anonpublic disclosure of confidentialcommercial information would be inviolation of the Trade Secrets Act, 18U.S.C. 1905. That statute makes theunauthorized disclosure of suchinformation by a Federal employee acrime.

The proposed amendment to § 20.88will enable FDA, in its discretion andsubject to the conditions imposed bythis proposed amendment, to provide orreceive confidential commercialinformation (whether provided by thesponsor or found in investigatoryrecords) in nonpublic exchanges withState government officials for use incooperative regulatory efforts or lawenforcement efforts. FDA will be able tomake such exchanges of confidentialcommercial information contained insubmissions, in FDA- or Stategovernment-prepared reviews andrecords of such submissions, and inFDA- or State government-preparedinvestigatory records, without invokingthe rule established in § 20.21 that anymember of the public becomes entitledto the same information.

The agency does not intend thatdisclosures of confidential commercialinformation to State governmentofficials will be a routine occurrence.FDA intends to engage in the disclosureof nonpublic confidential commercialinformation to State governmentofficials only when certain conditionsare met, and only in its discretion. Inevery case, the proposed rule(§ 20.88(d)(1)(i)) would requireassurances from the State governmentthat the information will be held inconfidence. The proposed rule(§ 20.88(d)(1)(ii)) would further requirethat any one of three additional

conditions be met: (1) Writtenauthorization by the submitter of theinformation; (2) a finding that disclosureis in the interest of public health byreason of the State government’spossessing information concerning thesafety, effectiveness, or quality of theproduct or information concerning aninvestigation, or by reason of the Stategovernment being able to exercise itsregulatory authority more expeditiouslythan the agency; or (3) the disclosure isto a State government scientist visitingFDA as part of a joint review or long-term cooperative training effort thatfurthers FDA’s regulatory mission.Thus, the circumstances and safeguardsunder which FDA would exchangeconfidential commercial informationwith State government officialspursuant to the proposed amendment to§ 20.88 would be the same as thoserecently provided in the 1993amendment to § 20.89 regarding FDAdisclosure of confidential commercialinformation to foreign governmentofficials.

B. Proposals for Regulatory Provisions forExchanging Predecisional Documents andOther Nonpublic Information With State andForeign Government Officials

The agency is proposing to amend§§ 20.88(e) and 20.89(d) to cover thenonpublic exchange between FDA andState government officials (§ 20.88(e))and between FDA and foreigngovernment officials (§ 20.89(d)), ofnonpublic predecisional documentsconcerning FDA’s and othergovernments’ proposed regulations,impending regulatory initiatives, orother nonpublic information relevant toagency activities (including, but notlimited to, draft regulations, guidelinesfor technical issues to be addressed insponsors’ submissions, draft staffmanual guides, draft compliance policyguides, strategy documents forinspection priorities, and draft MOU’sbetween State, Federal, and foreigngovernment agencies).

FDA wants the ability, in somecircumstances and only when specificconditions are met, to exchangepredecisional, preimplementation, orother nonpublic documents with Stategovernment officials and foreigngovernment officials, without beingcompelled to disclose them to thepublic.

For the purposes of § 20.88(e) of thisproposed regulation, the term ‘‘officialof a State government agency’’ mayinclude an official of an organization ofState officials having responsibility tofacilitate harmonization of Statestandards and requirements in FDA’sareas of responsibility. Similarly, for the

purposes of § 20.89(d) of this proposedregulation, the term ‘‘foreigngovernment official’’ may include anofficial of an international organizationhaving responsibility to facilitateharmonization of global standards andrequirements in FDA’s areas ofresponsibility. Examples oforganizations whose officials may begiven access to draft nonpublicdocuments are the Association of Foodand Drug Officials (AFDO) and the Foodand Agriculture Organization (FAO) ofthe United Nations.

The ability to exchange predecisionaland preimplementation documents withthe officials in question will facilitateharmonization of national andinternational regulatory requirements.

In every case, the proposedregulations (§§ 20.88(e)(1)(i) and20.89(d)(1)(i)) require assurances fromthe receiving government that theinformation will be held in confidence.The proposed regulations(§§ 20.88(e)(1)(ii) and 20.89(d)(1)(ii))further require the agency to determinethat it is reasonably necessary toexchange the nonpublic documents toenhance Federal-State uniformity or tofacilitate global harmonization ofregulatory requirements, cooperativeregulatory activities, or implementationof obligations resulting frominternational agreements. When theseconditions are met, the agency believesthat the records will be exempt frommandatory public disclosure under theFOIA.

C. FDA Believes the Deliberative ProcessPrivilege Should Protect Certain Adviceand Recommendations from Foreignand State Counterparts

The proposed amendments(§§ 20.88(e)(2) and 20.89(d)(2)) wouldestablish that State and foreigngovernment officials are not members ofthe public for purposes of exchange ofcertain nonpublic predecisional records,and that such exchanges will not invokethe requirements in § 20.21 of uniformaccess to records. FDA believes thatrecords of advice and recommendationsbetween government officialsconcerning public health andharmonization initiatives can beprotected from mandatory disclosureunder exemption 5 of the FOIA, 5 U.S.C.552(b)(5). That exemption incorporatescommon law discovery privileges forintra- and interagency memoranda,including the deliberative processprivilege asserted by governmentagencies to protect the process andquality of decisionmaking.

FDA believes it is appropriate toassert the deliberative process privilegein response to requests for public access


to certain communications from Stateand foreign government officialsbecause the same policy reasons thatsupport nondisclosure of deliberativeand predecisional memoranda generatedby Federal government agencies justifywithholding, in many circumstances,the advice and recommendationsgenerated for FDA by State and foreigngovernment counterparts.

The agency’s ability to make sounddecisions about the development andimplementation of public health andharmonization initiatives is enhancedby access to the advice andrecommendations of experts in Stateand foreign governments who areengaged in similar efforts in their ownjurisdictions. The agency views thiskind of consultation as functionallyequivalent to the ‘‘intra-’’ or‘‘interagency’’ deliberation morecommonly protected by exemption 5 ofthe FOIA. Indeed, it is frequently thecase that advice from a State or foreignhealth official whose responsibilitiesparallel those of FDA officialsconcerning the feasibility of a particulartechnical or harmonization regulationwill be as relevant as similarrecommendations solicited fromemployees in other Federal governmentagencies.

In order to encourage the most candidand useful exchange of information inthese circumstances, FDA believes it isessential to have discretion to protectfrom public disclosure the advice andrecommendations it receives from Stateor foreign government officials. Again,the same policy considerations apply aswould apply to intraagencydeliberations: State and foreigngovernment officials are at least as likelyas Federal employees to be inhibitedfrom giving frank advice when theyknow that opinion will be made public.

The principle that documentsgenerated outside a government‘‘agency’’ may still qualify for protectionfrom public disclosure under exemption5 of the FOIA has been endorsed bymany courts. In recognizing thepractical necessity that requires agencydecisionmaking to depend on adviceand opinions from sources beyondagency or Federal personnel, courtshave adopted a ‘‘functional’’ test forassessing the applicability of exemption5 protection, and included a variety of‘‘nonagencies’’ within the threshholddefinition of exemption 5 memoranda.(See, e.g., Formaldehyde Institute v.HHS, 889 F.2d 1118, 1123–1124 (D.C.Cir. 1989) (exemption 5’s interagencythreshold requirement applied toopinions solicited from outsidescientific journal reviewers); Ryan v.Department of Justice, 617 F.2d 781, 790

(D.C. Cir. 1980) (exemption 5 applied torecommendations from Senators toAttorney General); Mobil Oil Corp. v.FTC, 406 F. Supp. 305, 315 (S.D.N.Y.1976) (exemption 5 rationale applies toadvice from State as well as Federalagencies). FDA believes the examples ithas described in this documentdemonstrate that it is appropriate andnecessary for FDA to be able to treat theexchange of advice andrecommendations from foreign andState government officials as afunctional part of the agency’sdeliberative process.

In addition to protecting certainadvice and recommendations from Stateand foreign government officials whichFDA utilizes in its decisionmakingprocesses, FDA also believes it shouldbe able to cooperate with State andforeign government officials whorequest FDA input for deliberationswithin their own agencies.

Those State and foreign governmentagencies with which FDA mostfrequently consults operate, as doesFDA, within laws that constrain theirability to share nonpublic information.In many circumstances, these agenciesrequire assurances that FDA will notdisclose to the public in response to aFOIA request certain informationprovided to FDA by a State or foreigngovenment official. FDA has alwaysbeen able to give such assurances withrespect to proprietary or lawenforcement information provided byState or foreign governments; underFDA’s public information regulations,such information is subject to the sameprotection as if the information hadbeen directly gathered or received byFDA. (See § 20.88(c)(1) and 20.89(a)).Indeed, FDA’s regulations have for 20years permitted the agency to provideadditional assurances with respect toinvestigatory records that the State orforeign government will provide onlyupon assurance that protection willcontinue for some longer period of time.Id.

However, FDA has not been able toprovide similar assurances ofconfidentiality with respect tononpublic information provided to FDAby State or foreign governments that isof a deliberative nature, reflectinginternal deliberations of that othergovernment entity or predecisionaldrafts of records that are intended toimplement public health initiatives onthe part of counterpart State or foreigngovernment agencies.

As discussed above, FDA believes thatwhen such counterpart officials provideadvice to FDA on issues and initiativesthat FDA is deliberating, that advice isthe functional equivalent of advice that

would be provided by experts withinthe agency or by other Federal agencyemployees. Accordingly, under theamendments proposed to §§ 20.88 and20.89, FDA would protect asinteragency memoranda underexemption 5 of the FOIA the records itexchanged with foreign and Stategovernment health officials as part ofFDA’s efforts to reach a decision aboutinitiatives it was considering. However,FDA believes the public health andFDA’s relationships with foreign andState counterparts require that theagency be able to provide similarconsultations to counterpart officialswhen it is those State or foreigngovernment officials who requestadvice, and who require the exchange toremain nonpublic in order to protecttheir own deliberative processes. Inmost cases, because the foreign or Statecounterpart is providing FDA withinformation that is confidentialcommercial or investigatoryinformation, FDA’s publishedregulations permit FDA to protect thoserecords from public disclosure. Therehave been situations, however, where aforeign government agency wishes toshare with FDA a document that willnot qualify for protection under theFOIA for proprietary or investigatoryrecords, and which may not qualifyunder the deliberative process privilegediscussed above because the decisionthat is being made is entirely within thejurisdiction of the foreign governmentcounterpart. FDA believes internationalcomity and the potential benefit topublic health that may result from suchconsultations require the agency toattempt to honor such requests forconfidentiality whenever it is possibleto do so.

In circumstances where advice orinformation is provided by foreigngovernments pursuant to internationalagreements that provide for thenondisclosure of such exchanges, FDAbelieves the record generated by theforeign government and provided toFDA is not necessarily an ‘‘agencyrecord’’ subject to FOIA and that FDA,therefore, might honor requests forconfidentiality without contraveningpublic disclosure requirements. TheSupreme Court has delineated twobroad tests for determining whether adocument is an agency record forpurposes of FOIA. The document: (1)Must be created or obtained by anagency, and (2) must be under thecontrol of the agency when a FOIArequest for the record is made. SeeUnited States Department of Justice v.Tax Analysts, 492 U.S. 136 (1989).When a foreign government shares


documents pursuant to agreements thatrequire confidentiality before disclosurewill be made, the record may not beunder the ‘‘control’’ of FDA. In thosecircumstances where a treaty,agreement, or MOU between the UnitedStates and a foreign governmentrequires confidentiality in order toencourage international consultation,FDA believes that control of the recordmay be governed by the treaty oragreement under which the foreigngovernment health officials have sharedthe information with United Statescounterparts. Two recent opinions byFederal District Courts in the District ofColumbia support this view. See Katz v.National Archives & RecordsAdministration, No. 92–1024 (D.D.C.March 2, 1994), reconsideration denied(D.D.C. August 24, 1994) (appealpending) (autopsy records not agencyrecords because their disposition wasgoverned by a Deed of Gift to NationalArchives); KDKA–TV v. RichardThornburgh, et. al, No. 90–1536 (D.D.C.September 30, 1992) (reports inpossession of National TransportationSafety Board not agency record becausedisclosure is governed by conditions ofInternational Convention).

Similarly, FDA believes that in thoserare instances where State governmentsinitiate review of their own proceedingsthrough consultation with FDA onconditions of confidentiality, FDAshould be able to offer advice withoutjeopardizing public disclosure ofrecords that would interfere with thedeliberative processes of the Stateagency. FDA invites the submission offurther information and views on thisissue.

D. FDA’s Proposals Will Not Reduce PublicAccess to Agency Records

FDA believes these proposals will donothing to diminish current publicaccess to agency records. The purpose ofthese proposed amendments is not toreduce the number or types of recordsthat will be available to the public fromFDA, but to enhance the agency’s accessto information exchanges that itcurrently is not able to undertake.

FDA fully supports the AttorneyGeneral’s Memorandum of October 4,1993, establishing new standards ofgovernment openness, and FDA intendsto apply a ‘‘foreseeable harm’’ standardwhen applying FOIA exemptions.Under this policy, government agenciesare guided by the principle that exemptinformation should not be withheldfrom a FOIA requester unless it need be.FDA reiterates that the nonpublicexchange of information with State andforeign government counterparts willnot be a routine occurrence; the

proposed regulations, which requirespecific assurances from the receivingofficial and a determination on the partof FDA that the exchange is necessary,establish rigorous prerequisites.

FDA has no intention of protectingfrom public disclosure any informationit shares with foreign or Statecounterparts that may be disclosed tothe public without harm to any privateor government interests. Nor does FDAbelieve that all State or foreigncounterparts will desire or require FDAto protect information they provide tothis agency. However, the agency alsobelieves that its current publicinformation regulations are too rigid foreffective exchange of information in anational and increasingly internationaleconomy. These proposals reflect FDA’sdetermination that its public healthmission has been hampered in certaincircumstances by the inability toexchange nonpublic information withcounterpart officials. The agencybelieves the proposed changes havebeen drafted narrowly and withsufficient safeguards to allow FDA toexchange nonpublic information whennecessary without damage to eitherproprietary interests or appropriatepublic access to agency records.

As stated earlier, any informationprovided by State or foreign governmentofficials upon which FDA is relying willbe included in published proposals. Atthat time, the general public will befully informed and have an opportunityto comment on the substance of anyadvice from foreign or State officialsthat is incorporated into agencyproposals or initiatives.

III. Environmental ImpactThe agency has determined under 21

CFR 25.24(a)(8) that this action is of atype that does not individually orcumulatively have a significant effect onthe human environment. Therefore,neither an environmental assessmentnor an environmental impact statementis required.

IV. Analysis of ImpactsFDA has examined the impacts of the

proposed rule under Executive Order12866 and the Regulatory Flexibility Act(Pub. L. 96–354). Executive Order 12866directs agencies to assess all costs andbenefits of available regulatoryalternatives and, when regulation isnecessary, to select regulatoryapproaches that maximize net benefits(including potential economic,environmental, public health and safety,and other advantages; distributiveimpacts; and equity). The agencybelieves that this proposed rule isconsistent with the regulatory

philosophy and principles identified inthe Executive Order. In addition, theproposed rule is not a significantregulatory action as defined by theExecutive Order and so is not subject toreview under the Executive Order.

The Regulatory Flexibility Actrequires agencies to analyze regulatoryoptions that would minimize anysignificant impact of a rule on smallentities. Because this proposed rulepromotes harmonized regulatoryrequirements, nationally andinternationally, thereby reducingdisparate regulatory requirements, theagency certifies that the proposed rulewill not have a significant economicimpact on a substantial number of smallentities. Therefore, under the RegulatoryFlexibility Act, no further analysis isrequired.

V. CommentsInterested persons may, on or before

April 27, 1995, submit to the DocketsManagement Branch (address above)written comments regarding thisproposal. Two copies of any commentsare to be submitted, except thatindividuals may submit one copy.Comments are to be identified withdocket number found in brackets in theheading of this document. Receivedcomments may be seen in the officeabove between 9 a.m. to 4 p.m., Mondaythrough Friday.

List of Subjects in 21 CFR Part 20Confidential business information,

Courts, Freedom of information,Government employees.

Therefore, under the Federal Food,Drug, and Cosmetic Act and underauthority delegated to the Commissionerof Food and Drugs, it is proposed that21 CFR part 20 be amended as follows:

PART 20—PUBLIC INFORMATION

1. The authority citation of 21 CFRpart 20 is revised to read as follows:

Authority: Secs. 201–903 of the FederalFood, Drug, and Cosmetic Act (21 U.S.C.321–393); secs. 301, 302, 303, 307, 310, 311,351, 352, 354–360F, 361, 362, 1701–1706,2101 of the Public Health Service Act (42U.S.C. 241, 242, 242a, 242l, 242n, 243, 262,263, 263b–263n, 264, 265, 300u–300u–5,300aa–1); 5 U.S.C. 552; 18 U.S.C. 1905; 19U.S.C. 2531–2582.

2. Section 20.88 is amended byadding new paragraphs (d) and (e) toread as follows:

§ 20.88 Communications with State andlocal government officials.

* * * * *(d)(1) The Commissioner of Food and

Drugs, or any other officer or employeeof the Food and Drug Administration


whom the Commissioner may designateto act on his or her behalf for thepurpose, may authorize the disclosureof confidential commercial informationsubmitted to the Food and DrugAdministration, or incorporated intoagency-prepared records, to Stategovernment officials as part ofcooperative law enforcement orregulatory efforts, provided that:

(i) The State government agency hasprovided both a written statementestablishing its authority to protectconfidential commercial informationfrom public disclosure and a writtencommitment not to disclose any suchinformation provided without thewritten permission of the sponsor orwritten confirmation by the Food andDrug Administration that theinformation no longer has confidentialstatus; and

(ii) The Commissioner of Food andDrugs or the Commissioner’s designeemakes one or more of the followingdeterminations:

(A) The sponsor of the productapplication has provided writtenauthorization for the disclosure;

(B) Disclosure would be in the interestof public health by reason of the Stategovernment’s possessing informationconcerning the safety, effectiveness, orquality of a product or informationconcerning an investigation, or byreason of the State government beingable to exercise its regulatory authoritymore expeditiously than the Food andDrug Administration; or

(C) The disclosure is to a Stategovernment scientist visiting the Foodand Drug Administration on theagency’s premises as part of a jointreview or long-term cooperative trainingeffort authorized under section 708 ofthe act, the review is in the interest ofpublic health, the Food and DrugAdministration retains physical controlover the information, the Food and DrugAdministration requires the visitingState government scientist to sign awritten commitment to protect theconfidentiality of the information, andthe visiting State government scientistprovides a written assurance that he orshe has no financial interest in theregulated industry of the type thatwould preclude participation in thereview of the matter if the individualwere subject to the conflict of interestrules applicable to the Food and DrugAdministration advisory committeemembers under § 14.80(b)(1) of thischapter. Subject to all the foregoingconditions, a visiting State governmentscientist may have access to trade secretinformation, entitled to protectionunder section 301(j) of the act, in thosecases where such disclosures would be

a necessary part of the joint review ortraining.

(2) Except as provided underparagraph (d)(1)(ii)(C) of this section,this provision does not authorize thedisclosure to State government officialsof trade secret information concerningmanufacturing methods and processesprohibited from disclosure by section301(j) of the act, unless pursuant to anexpress written authorization providedby the submitter of the information.

(3) Any disclosure under this sectionof information submitted to the Foodand Drug Administration orincorporated into agency-preparedrecords does not invoke the ruleestablished in § 20.21 that such recordsshall be made available to all membersof the public.

(e)(1) The Commissioner of the Foodand Drugs, or any other officer oremployee of the Food and DrugAdministration whom theCommissioner may designate to act onhis or her behalf for the purpose, mayauthorize the disclosure to, or receiptfrom, an official of a State governmentagency of nonpublic predecisionaldocuments concerning the Food andDrug Administration’s or the othergovernment agency’s regulations orother regulatory requirements, or othernonpublic information relevant to eitheragency’s activities, as part of efforts toimprove Federal-State uniformity,cooperative regulatory activities, orimplementation of Federal-Stateagreements, provided that:

(i) The State government agency hasprovided both a written statementestablishing its authority to protect suchnonpublic documents from publicdisclosure and a written commitmentnot to disclose any such documentsprovided without the writtenconfirmation by the Food and DrugAdministration that the documents nolonger have nonpublic status; and

(ii) The Commissioner of Food andDrugs or the Commissioner’s designeemakes the determination that theexchange is reasonably necessary toimprove Federal-State uniformity,cooperative regulatory activities, orimplementation of Federal-Stateagreements.

(2) Any exchange under this sectionof nonpublic documents does notinvoke the rule established in § 20.21that such records shall be madeavailable to all members of the public.

(3) For purposes of this paragraph, theterm ‘‘official of a State governmentagency’’ includes an employee of anorganization of State officials havingresponsibility to facilitateharmonization of State standards and

requirements in FDA’s areas ofresponsibility. For such an official, thestatement and commitment required byparagraph (e)(1)(i) of this section shallbe provided by both the organizationand the individual.

3. Section 20.89 is amended byadding new paragraph (d) to read asfollows:

§ 20.89 Communication with foreigngovernment officials.

* * * * *(d)(1) The Commissioner of Food and

Drugs, or any other officer or employeeof the Food and Drug Administrationwhom the Commissioner may designateto act on his or her behalf for thepurpose, may authorize the disclosureto, or receipt from, an official of aforeign government agency of nonpublicpredecisional documents concerning theFood and Drug Administration’s or theother government agency’s regulationsor other regulatory requirements, orother nonpublic information relevant toeither agency’s activities, as part ofcooperative efforts to facilitate globalharmonization of regulatoryrequirements, cooperative regulatoryactivities, or implementation ofinternational agreements, provided that:

(i) The foreign government agency hasprovided both a written statementestablishing its authority to protect suchnonpublic documents from publicdisclosure and a written commitmentnot to disclose any such documentsprovided without the writtenconfirmation by the Food and DrugAdministration that the documents nolonger have nonpublic status; and

(ii) The Commissioner of Food andDrugs or the Commissioner’s designeemakes the determination that theexchange is reasonably necessary tofacilitate global harmonization ofregulatory requirements, cooperativeregulatory activities, or implementationof international agreements.

(2) Any exchange under this sectionof nonpublic documents does notinvoke the rule established in § 20.21that such records shall be madeavailable to all members of the public.

(3) For purposes of this paragraph, theterm ‘‘official of a foreign governmentagency’’ includes, an employee of aninternational organization havingresponsibility to facilitate globalharmonization of standards andrequirements in FDA’s areas ofresponsibility. For such an official, thestatement and commitment required byparagraph (d)(1)(i) of this section shallbe provided by both the organizationand the individual.


Dated: January 23, 1995.William K. Hubbard,Interim Deputy Commissioner for Policy.[FR Doc. 95–2111 Filed 1–26–95; 8:45 am]BILLING CODE 4160–01–F

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Part VI

Office of PersonnelManagement5 CFR Parts 430, 432, 451 and 531Performance Management; Proposed Rule



5 CFR Parts 430, 432, 451 and 531

RIN 3206–AG34

Performance Management

AGENCY: Office of PersonnelManagement.ACTION: Proposed rule.

SUMMARY: The Office of PersonnelManagement (OPM) is issuing proposedregulations to deregulate performancemanagement and incentive awards,including provisions allowing agenciesto use as few as two levels for criticalelement appraisals and summary ratingsfor non-SES employees, and to makeconforming changes to relatedregulations. These changes are proposedto provide agencies additional flexibilityas called for by the NationalPerformance Review.DATES: Comments must be submitted onor before March 28, 1995.ADDRESSES: Comments may be sent ordelivered to: Allan D. Heuerman,Assistant Director for Labor Relationsand Workforce Performance, U.S. Officeof Personnel Management, Room 7412,1900 E Street NW., Washington, DC20415.FOR FURTHER INFORMATION CONTACT:Barbara Colchao, (202) 606–2720.SUPPLEMENTARY INFORMATION: To pursuethe flexibility and decentralizationcalled for by the National PerformanceReview (NPR), OPM proposes amendingits regulations to remove many of thecurrent regulatory requirements andpermit agencies to implementperformance management systems andprograms for non-SES employees thatbetter fit their organizational climateand needs. (OPM is conducting aseparate review of SES performanceappraisal regulations.) These proposedchanges are intended to increase systemflexibility and not to suggest thesuperiority of the newly availableoptions. OPM advises agencies toexamine their individual circumstancescarefully before making any majorchanges to their performancemanagement systems and programs.

Partnership and SuccessfulPerformance Management

Agencies are strongly urged todevelop their performance managementsystems and programs in partnershipwith their employees and unionrepresentatives in accordance with law.Many studies have shown that thesuccess of a performance managementsystem in achieving its goals is

dependent upon acceptance by themanagement and employees who use it.There is no better way to garner supportfor a system than by giving allstakeholders a role in developing it.Further, the National PerformanceReview stated in its accompanyingreport, Reinventing Human ResourceManagement, that under the idealperformance management system‘‘Employees and their representativeswill be involved in design andimplementation of performancemanagement programs and indevelopment of performanceexpectations.’’ Consequently, OPMadvises agencies that these regulatorychanges in performance managementshould be implemented through fullpartnership with employees and theirunion representatives.

Performance Management Systems andPrograms

The recommendations of the NationalPerformance Review for reforming theGovernment’s performance managementsystem contemplated a policyenvironment that would permit‘‘complete decentralization ofperformance management within aframework of broad, governmentwideprinciples.’’ OPM is establishing thatframework in these proposedregulations for appraisal and awards,which would remove many previousregulatory constraints and implementflexible Governmentwide systems forappraisal and awards. This approachwill permit the implementation of theNPR recommendation for thedevelopment of agency-basedperformance management and incentiveaward programs tailored to meet eachagency’s unique needs.

The law governing performanceappraisal provides that agencies mustestablish one or more appraisal systems,and that OPM must review and approvean agency’s system(s). OPM is proposingto define an agency appraisal system asthe agency’s framework of policies andparameters (i.e., guidelines, boundaries,limits) for the administration ofperformance appraisal. (See § 430.204.)Although an agency would beauthorized to establish more than onesystem, OPM anticipates that mostagencies will not find it necessary to doso. OPM goes on to propose that withinthat OPM-approved framework, anagency would be free to establish andadapt one or more appraisal programs ofspecific procedures and requirements.(See § 430.205.)

Consequently, when an agency hasdetermined it can more effectively meetthe objectives for performancemanagement to improve individual and

organizational performance byestablishing different specificperformance appraisal procedures andrequirements tailored to the mission,work technology, and/or employees ofits organizational subcomponents or forsubsets of positions, the proposedregulations would authorize the agencyto develop appropriate, separateappraisal programs under theframework of its appraisal system.

Deregulating Performance ManagementOPM is proposing implementation of

NPR recommendations for flexible,decentralized performance managementthrough deregulation of appraisal andawards. That deregulation would beachieved in at least three ways.

First, the regulations have beenreviewed to eliminate unnecessary orredundant requirements. A number ofrequirements had been set forth inregulation, but were not required bystatute. Many of these that have come tobe unnecessarily constraining orburdensome (e.g., specifying requiredprocedures for employees on details,requiring an SF–50 for a time-off award)would be eliminated. On the otherhand, several regulations that merelyrepeat requirements that are alreadyclearly stated in statute would also beeliminated. In these instances, of course,the statutory requirements will still bein effect.

Second, a number of regulatoryrequirements would be removed, notbecause they were necessarilyineffective or redundant, but becauseagencies should be free to use themwithout being required to use them. Forexample, the proposal to eliminate therequirement for second-level review ofperformance plans should not be takenas an indication that OPM hasconcluded that second-level review is abad idea. In many instances, the reverseis true. However, OPM is proposing toachieve a shift in policy perspectiveunder which an agency’s use of second-level review in its performancemanagement programs would reflect theagency’s program design choice ratherthan compliance with aGovernmentwide regulatoryrequirement. A similar situation can befound in OPM’s proposal to eliminatemost restrictions on the use of time-offawards. Many agencies may choose toretain some limits, and they would befree to do so.

Another example of this form ofderegulation that would implement anauthority without establishing arequirement is OPM’s proposal to deletesubpart E (Performance Awards) of part430 and integrate provisions for rating-based cash awards into part 451


(Awards). This would consolidate theregulatory structure and clarify thatrating-based cash performance awardprograms are an option that agencies areauthorized—but not required—to use.

Finally, deregulation would resultfrom modifying OPM’s review of agencysystems. An agency’s appraisal system,or overall policy framework, would stillbe reviewed and approved, as requiredby law, for compliance with regulatoryrequirements. However, the scope ofthat review would be limited to thatrequired by law, and there would befewer regulatory requirements to review.The proposed regulation returns theGovernmentwide regulatory scheme forperformance management to thedecentralized approach initially takenin implementing the Civil ServiceReform Act of 1978. The highly detailedregulatory requirements that OPM isproposing to modify date to the mid-1980’s, a time when there was a strongpolicy interest in achievingGovernmentwide uniformity.Experience has provided substantialevidence that the ‘‘one size fits all’’approach does not support effectiveperformance management and needs tobe changed.

Reinventing Performance ManagementIn addition to reducing the amount of

regulation, OPM is proposing regulatoryrevisions to facilitate applyingperformance management regulations toimproving individual andorganizational performance. Thelanguage and context of existingregulation is centered strongly in amodel of individual performance andrecognition. The language, context, andfocus of effective performancemanagement practice have alteredsubstantially in recent years. Manyorganizations have benefitted from ashift to focusing on the group or teamperformance level. Such a shift cangreatly improve the credibility andutility of appraisal and award processesand outcomes for achieving theobjective of improving organizationalperformance and missionaccomplishment.

The current regulations stem from amodel of appraisal based more onprocess inputs and the duties andresponsibilities in an employee’sindividual position description and lesson the results and accomplishments forwhich that employee is accountable.Experience has shown that those resultsand accomplishments are often morereasonably and meaningfully described,and certainly measured, at the group orteam level. One objective in OPM’srevision of appraisal and awardregulations is to ensure that they could

be applied to managing groupperformance. Consequently, manyproposed revisions would removelanguage (e.g., ‘‘employee’’ and‘‘position’’) that narrowed theregulation’s focus to individualperformance. Several appraisal-relatedterms would be retained (e.g., appraisal,critical element, performance), but theirdefinitions modified to accommodatethis broader context.

OPM’s goal is to establish a regulatoryscheme that would operate effectively atthe individual and the team or grouplevel. An agency would still be able todesign and operate its programs entirelyat the individual level. Establishing andmaintaining individual accountabilityand taking appropriate actions to dealwith poor performers must remainsignificant aspects of the Government’sperformance management system.Therefore, the regulations wouldcontinue to require that each employeehave a performance plan, and OPM isproposing to require that each plan mustinclude at least one critical element thataddresses individual performance. (See§ 430.206(b)(4).)

In addition to making changes toaccommodate group performance, OPMis proposing some revisions to theregulatory structure that are intended torefocus attention away from the once-a-year summary rating aspects ofperformance appraisal procedures andback toward the processes involved incommunicating performanceexpectations and providing ongoingfeedback. To that end, OPM isproposing to establish separate sectionswithin the appraisal subpart of part 430that focus on:—Planning performance, (See

§ 430.206.)—Monitoring performance, (See

§ 430.207.)and—Rating performance at the end of an

appraisal period or cycle. (See§ 430.208.)The definition and requirements for a

performance plan would be broadenough to accommodate including otherexpressions of performance expectationsin addition to establishing elements andstandards. (See § 430.203 and§ 430.206(b)(5).) This would facilitateagencies integrating other performanceplanning processes with their appraisalprograms (for example, by includingfactors from performance contracts,performance goals and targets,published customer service standards,organization-level performance plansestablished under the GovernmentPerformance and Results Act of 1993,etc.). The proposed regulations seek

only to establish clearly that agencieswould be free to integrate such planningtools and products and do not establishspecific requirements or procedures fordoing so. Such factors could beconsidered, for example, in designingincentive award schemes anddistributing rewards and recognition.However, such factors could not be usedas the basis for initiating a performance-based action, which requires adetermination that performance on acritical element is ‘‘Unacceptable.’’

Another area where OPM is proposinga broader context is the process forderiving a summary rating. AlthoughOPM is proposing to permit as few astwo summary rating levels (see below),it is also anticipated that agencies willcontinue to have an interest in makingand recording further distinctionsamong the vast majority of employeeswho meet basic performanceexpectations. OPM is proposingregulations that would give agenciesmore flexibility in deriving andassigning summary rating levels. Forexample, agencies would be able to—but not required to—consider otherperformance-related factors beyondappraisal of employee or groupperformance on critical elements. (See§ 430.208(b).) Examples of such otherfactors include:—Components from a performance plan

such as meeting work plan objectivesor group performance goals that hadnot been specifically framed ascritical elements,

—A record of receiving awards forsuperior performance,

—A record of documented productivitygains,

—A non-critical element included in theperformance plan to communicate anexpectation and standards that, if met,could raise a summary rating aboveLevel 3 (‘‘Fully Successful’’ orequivalent).In addition, OPM is proposing to give

agencies the flexibility to use forceddistributions of summary ratings aboveLevel 3 (‘‘Fully Successful’’ orequivalent), but only where thosesummary ratings above that level are notderived solely based on a comparison ofperformance against predeterminedstandards. An example of such a schemewould be to use performance-relatedcriteria to rank the employees whosecritical elements are all appraised as atleast ‘‘Fully Successful’’ and assign thehighest rating level to a limited numberof employees. It should be noted thatthe effectiveness and acceptance of sucha scheme would rest largely on thecredibility and equity of the processesand criteria used to rank the employees.


Nevertheless, OPM is proposing to offeragencies this flexibility. If performancestandards defining the higher levels hadbeen established, an agency would beprohibited from prescribing adistribution of ratings. (See§ 430.208(c).)

Within the awards arena ofperformance management, reinventingthe system of Governmentwide policiesfor recognition and reward programswould be achieved by integrating rating-based cash performance awardprovisions into the same regulatory partas other awards and by simplifyingthose regulatory provisions. This wouldhave the effect of giving agencies aframework of broad, flexible principles

for designing and administeringdecentralized award programs,consistent with NPR recommendations.Within those broad principles, agencieswould be free to design and operate awide variety of tailor-made incentiveand recognition programs at theindividual and group level, includingmost of the alternative reward, variablepay, and pay-for-performance schemesthat can contribute to improvingindividual and organizationalperformance.

Number of Summary Rating LevelsOPM is proposing to permit agencies

to use as few as two levels for summaryperformance ratings. Among summary

rating levels, agencies would berequired to include a Level 1(‘‘Unacceptable’’) and a Level 3 (‘‘FullySuccessful’’ or equivalent). If more thantwo summary rating levels were used,the agency could choose anycombination from the remaining threelevels (i.e., Level 2, Level 4, and Level5). Agencies also would continue to bepermitted to use equivalent terms for‘‘Fully Successful’’ and/or‘‘Outstanding.’’ (See § 430.208(d).)

Using the five possible summaryrating-level designators established at§ 430.208(d), the following tableillustrates the various patterns of levelsavailable.

Number of summary rating levels in program

Summary rating level designator fromnew § 430.208(d)

Level1

(‘‘un-ac-

cept-able’’)

Level2

Level3

(‘‘fullysuc-cess-ful’’)

Level4

Level5

(‘‘out-stand-ing’’)

Two ............................................................................................................................................................ X .......... X .......... ..........Three:

Option 1 ................................................................................................................................................. X .......... X .......... XOption 2 ................................................................................................................................................. X .......... X X ..........Option 3 ................................................................................................................................................. X X X .......... ..........

Four:Option 1 ................................................................................................................................................. X .......... X X XOption 2 ................................................................................................................................................. X X X .......... XOption 3 ................................................................................................................................................. X X X X ..........

Five X X X X X

Permitting the use of only twosummary rating levels would notrequire a change in the rules governingadditional service credit forperformance in determining anemployee’s retention standing for RIFpurposes since an appraisal programwith only two summary rating levelswould be required to use Level 3 (‘‘FullySuccessful’’ or equivalent) to summarizeacceptable performance. As set forth in5 CFR 351.504(d)(3), an employeewould receive ‘‘Twelve additional yearsof service credit for each performancerating of fully successful (Level 3) orequivalent.’’

Number of Levels for AppraisingElements

OPM is proposing to permit agenciesto use as few as two levels at which toappraise performance on the elementsin employee performance plans. At aminimum, it must be determinedwhether performance is ‘‘FullySuccessful’’ (or equivalent) or‘‘Unacceptable’’ when appraised againstestablished performance standards.Agencies would still be required toestablish performance standards at the

‘‘Fully Successful’’ (or equivalent) levelfor critical and non-critical elements.Also, agencies would continue to bepermitted to determine performance tobe at a level that has no establishedperformance standard but which hasbeen provided for by the applicableperformance appraisal program. (See§ 430.206(b)(6).)

Regulatory Changes in Awards

OPM is also proposing to reviseregulations so that the requirementsgoverning all types of awards for non-SES employees would be in part 451 ofchapter 5 of the Code of FederalRegulations. The proposed regulationsprovide for a few basic requirementswithin which agencies can design awardprograms to meet their individualcultures and needs.

The language throughout theseregulations has been reviewed for its useof the term ‘‘incentive award(s).’’ Formany years since the inception of theconsolidated awards authority forFederal employees in 1954, the term‘‘incentive’’ was used broadly to coverall types of awards including those thatare granted retrospectively at

management discretion to recognizepast contributions, such as special actsor suggestions. As awards theory andpractice have developed in recent years,however, ‘‘incentive’’ typically isapplied somewhat more restrictively toaward programs, such as productivitygainsharing and performancegoalsharing schemes, that are designedto specify clearly in advance whatrecognition and reward will be grantedbased on a given contribution. Programssuch as these have demonstrated theireffectiveness for improvingperformance. At the same time, awardsthat recognize past contributions notspecified in advance beyond somegeneral criteria remain an appropriateand effective use of the authority togrant awards.

There is no strict definition ordistinction for the term ‘‘incentive’’ thatcan be established or applied.Nevertheless, to recognize trends inawards theory and practice, OPM isproposing to use only the term‘‘award(s)’’ in the broad regulations thatcover both the prespecified and theretrospective uses of the awardsauthority and limit use of the term


‘‘incentive’’ in the regulations tosituations where the relationshipbetween contribution and award isclearly specified in advance.

OPM is proposing to remove theseparate subpart (subpart E) within part430 governing the use of rating-basedcash performance awards and tointegrate a minimum number ofessential provisions into subpart A ofpart 451. (See §§ 451.104(a)(3),451.104(b) & (g), and 451.106(b), (f) &(g).) OPM is also proposing to delete theseparate subpart (subpart C) within part451 governing the use of time-off awardsand to integrate time-off awards withinthe more general award provisions. (See§§ 451.104(a) and 451.104(e).)

OPM is proposing new regulations toimplement new statutory provisions at 5U.S.C. 4508 and 4509 concerningrestrictions on awards for seniorpolitical appointees. (See § 451.105.) Inaddition, OPM is proposing a newregulation that alerts agencies that whendesigning award programs under thisauthority, they must ensure that awardschemes, especially those based onachievements other than those directlyrelated to an employee’s performanceplan, will not violate any other statuteor Governmentwide regulation. (See§ 451.106(a).)

Within-Grade Increase FlexibilitiesOPM is proposing an agency-

requested flexibility to permit the delayof the acceptable level of competence(ALOC) determination required forgranting a within-grade increase whenan employee has begun an opportunityperiod or has been given a notice of aproposed performance-based action.This option to delay an ALOC in no wayrestrains an agency from establishing apolicy to deny a within-grade increaseto an employee whose performance orrating of record supports such a denial.Furthermore, in those agencies thatchoose to continue using a Level 2(‘‘Minimally Successful’’ or equivalent)summary rating level, exercising thedelay option would create an inequitybetween the minimally acceptable andunacceptable employee in that theunacceptable employee would be givenadditional time to achieve ALOC. (See§ 531.409(c)(2).)

Another proposed flexibility wouldcover situations where agencies haveemployees who are authorized toperform activities of official interest tothe agency (e.g., labor-managementpartnership activities under section 2 ofExecutive Order 12871, serving as arepresentative of a labor organization,etc.), but are not able to perform underelements and standards (and, therefore,the agency is unable to provide a rating

of record). OPM is proposing to permitthe agency to waive the requirement foran ALOC determination and grantwithin-grade increases upon completionof the applicable waiting period. Thiswaiver option recognizes that suchemployees have not had a sufficientopportunity to perform under theirassigned elements and standards due tothe other authorized activities andsupposes that such performance wouldhave been at least ‘‘Fully Successful’’had it occurred. (See § 531.409(d)(5).)

Eligibility for Quality Step Increases

Agencies are required by ExecutiveOrder 11721 to establish plans forgranting additional step increases toemployees on the basis of high qualityperformance. Current regulation at§ 531.504 establishes that a Level 5(‘‘Outstanding’’ or equivalent) rating isrequired for granting such a quality stepincrease (QSI). OPM recognizes thatagencies that choose to adopt twosummary rating levels or to not includea Level 5 summary rating level wouldnot be able to grant a QSI under currentregulation, and thereby satisfy therequirements of Executive Order 11721.Consequently, OPM proposes to amendits pay regulations to permit anemployee under an appraisal programwithout a Level 5 summary rating levelto be eligible for a QSI based ondemonstrating sustained performancethat is significantly higher than thatexpected at the ‘‘Fully Successful’’level. Agencies would be required toestablish performance-related criteriafor QSI eligibility consistent with thisrequirement. (See § 531.504.)

Appraisal System Transition

OPM is proposing a regulatoryprovision that would assist agencies asthey develop and implement newappraisal systems and programs undernew regulatory flexibilities. At the timethat new regulatory requirements andprovisions become effective, it isessential to support a smooth transitionespecially for agencies that might bepursuing a pending administrativeaction initiated under the systems thatexist now. The regulatory provisionwould clarify that any appraisal systemthat had been reviewed and officiallyapproved by OPM as of the effectivedate of the revised regulations would beconsidered an approved system underthe revised regulations until such timeas changes to the system are approved.This will permit agencies to pursuepending actions and to continue tooperate their existing appraisal systemsand initiate other actions based onappraisal results. (See § 430.201(b).)

Agencies should note that theseregulatory changes establish norequirements or deadlines to makeappraisal system changes. Theflexibility the proposed regulationswould achieve includes the flexibility tocontinue agency appraisal policies,procedures, and requirements that arealready in use. OPM is proposing noregulatory provision that would create aregulatory conflict for any appraisalsystem already approved under currentregulation.

OPM would provide guidance toagencies on requirements andprocedures for submitting systemdescriptions to OPM for review andapproval.

Major Proposed Changes toPerformance Management Regulations

OPM also is proposing to amend itsregulations in other ways to provideadditional flexibilities, eliminateburdensome requirements, establishnew provisions, and make conformingand editorial changes. The following listsummarizes the substantive changes,including those discussed above.

Added Flexibilities and ReducedRequirements

1. Permits agencies to use as few astwo performance levels for appraisingelements.

2. Permits agencies to use as few astwo levels for summary performanceratings.

3. Removes the requirement for OPMapproval of plans for awards, qualitystep increases, and within-gradeincreases, but retains statutoryrequirement that OPM approveperformance appraisal systems.

4. Permits recording of performanceplans, ratings, etc., in formats other thanpaper.

5. Deletes the requirement for higher-level review of performance plans.

6. Replaces the requirement thatagencies assist employees withperformance below Fully Successfulwith the statutory requirement to assistwith performance that is Unacceptable.

7. Replaces the total prohibition onforced distributions of summary ratingswith prohibitions limited to summaryratings below Level 3 or situationswhere summary ratings are based solelyon appraisal against pre-establishedperformance standards.

8. Deletes the requirement that arating of record under one pay systembe used as the rating of record under anew system when there is no change induties or responsibilities.

9. Deletes the requirement foragencies to prepare a summary ratingwhen an employee changes position and


to specify how such a rating is to betaken into account when preparing arating of record.

10. Deletes fixed limits (90 to 120days) on the length of the minimumappraisal period, and replaces themwith a requirement that a minimumperiod be established.

11. Deletes specific requirements forrating employee performance while ondetail and replaces them with arequirement that an agency appraisalprogram address appraisal while ondetail.

12. Deletes the general requirementfor higher-level approval of a rating ofrecord and replaces it with arequirement that only ‘‘Unacceptable’’summary ratings be approved at ahigher level.

13. Replaces the requirement fortraining supervisors and employees onthe appraisal process with arequirement to communicate aboutrelevant parts of the system andprograms.

14. Deletes subpart E (PerformanceAwards) of part 430 and incorporatessome performance awards provisionsinto part 451 (Awards).

15. Deletes the recommendation tomake maximum use of awardsauthority.

16. Replaces the requirement todocument awards in the OPF with aprovision for agencies to establishcriteria to determine which awards todocument in the OPF.

17. Replaces the requirement forhigher-level review of awards with arequirement to follow agency financialmanagement control procedures.

18. Deletes the requirements for anSF–50 for a time-off award and forannual reports on performance awardsand awards program activity, and

replaces them with a requirement toreport data on all cash and time-offawards to the CPDF.

19. Deletes the provision that awardscannot be used as substitutes for pay orother personnel actions.

20. Deletes most regulatory provisionsand requirements regarding time-offawards, but retains the provision thatprohibits converting a time-off award tocash.

New Provisions1. A distinction is made between an

agency system (agencywide policy andparameters) and an agency program(specific procedures, forms, standards,etc.).

2. Agencies are encouraged to involveemployees and their representatives inthe development of award and appraisalsystems and programs.

3. Key definitions and provisionshave been broadened to explicitlyinclude teams.

4. Provision to maintain applicabilityof appraisal systems already reviewedand approved by OPM is added.

5. At least one element in aperformance plan must addressindividual performance.

6. Agencies are to ensure that anyaward program they develop does notconflict with any other applicable lawor regulation.

7. OPM is authorized to grant agencyrequests to extend 5 U.S.C. 4505a tonon-General Schedule employees asprovided by Executive Order 12828.

8. The provision that a rating-basedcash performance award cannot beappealed is clarified to include allawards.

9. The statutory restrictions ongranting awards to senior politicalofficials is added.

10. Agencies are to use the OPMGuide to Federal Workforce ReportingSystems when reporting data.

11. OPM is authorized to evaluateagency award programs.

12. A provision permitting an agencyto delay an ALOC determination if theemployee is in an opportunity period ornotice period is added.

13. A provision permitting an agencyto waive the ALOC determination foremployees who have been unable toperform under elements and standardsbecause they spent 100% of their timeon activities of official interest to theagency is added.

14. An agency that does not use the‘‘Outstanding’’ (Level 5) summary ratinglevel will be permitted to establishperformance-related criteria and grant aquality step increase to an employeewho demonstrates significantly highquality performance.

Table of Changes

The following table lists all theproposed changes to the currentregulation, including those discussedabove.

—In the left column, the table lists allcurrent regulations in parts 430 and451 and current regulations in parts432 and 531 that are impacted by theproposed regulations.

—In the middle column, the table liststhe proposed regulations that trackthe provisions of the currentregulations in the left column.

—In the right column, the table explainsthe changes in provisions from thecurrent regulation in the left columnto the proposed regulation in themiddle column.

Current rule Proposed rule Description of change

§ 430.101 ....................... § 430.101 ...................... Proposed rule removes citation of incentive award and pay statutes because they nolonger apply.

§ 430.102 ....................... § 430.102(a) ................. Proposed rule redefines performance management to reorient the definition to team set-tings and goals of the National Performance Review (NPR).

§ 430.103 ....................... § 430.102(c) ................. Proposed rule redescribes the Performance Management Plan; removes the requirementfor OPM approval of plans for awards, quality step increases, and within-grade in-creases; the requirement for final approval of component plans by OPM; and referenceto the Performance Management Plan Checklist to provide greater agency flexibility andto reflect OPM’s scope of review.

§ 430.209 (a) & (f) ........ Proposed rule revises and redesignates the provision requiring submission of appraisalsystem(s), system changes, and records to OPM to reflect OPM’s scope of review.

§ 430.201(a) ................... § 430.201(a) ................. Proposed rule makes editorial changes to section addressing statutory authority to elimi-nate nonessential information.

§ 430.201(b) ................. Proposed rule adds provision to maintain applicability of performance appraisal systems al-ready reviewed and approved by OPM.

§ 430.201(b) ................... § 430.102(b) ................. Proposed rule revises language that specifies objectives of performance appraisal systemsto specify objectives of performance management and to add references to teams.

§ 430.202(a) ................... § 430.202(a) ................. Proposed rule attaches to ‘‘General Schedule’’ a parenthetical reference to ‘‘GS/GM’’ to ac-commodate termination of the Performance Management and Recognition System.

§ 430.202(b) ................... § 430.202(b) ................. Proposed rule deletes requirements regarding the statutory authority under which agenciesmay exclude temporary employees to increase agency flexibility.



§ 430.202(c) ................... § 430.202(c) ................. Proposed rule substitutes a ‘‘minimum period established by the agency’’ for the fixed ‘‘120calendar days’’ as the minimum period of time a position is not reasonably expected toexceed to be excluded from coverage for the purpose of increasing agency flexibility.

§ 430.202(d) ................... § 430.202(d) ................. No change.§ 430.203 ....................... § 430.203 ...................... Appraisal is broadened to allow more flexibility.

Appraisal period is revised to reinforce the expectation that appraisal periods generally lastone year and to establish them as the basis for ratings of record.

Appraisal program is added to distinguish specific appraisal procedures and requirementsfrom agencywide appraisal policies and parameters established for the administration ofperformance appraisal within the agency.

Appraisal system is revised to clarify that it refers only to an agencywide framework for ap-praisal policy and to remove references to various system requirements that would nolonger apply.

Critical element is broadened to facilitate using performance planning to communicate ex-pectations, especially in team settings, by removing classification-centered references toduties and responsibilities of the position.

Non-critical element is deleted because it is not needed.Performance is revised to broaden the definition, to reference work responsibilities as well

as assignments, and to remove the classification-centered reference to a position to bet-ter accommodate team settings.

Performance Appraisal System is retained without change.Performance Management Plan is deleted because it is described in subpart A already.Performance plan is revised to reorient the definition to team settings and NPR goals and

to permit the performance plan to be recorded in formats other than paper.Performance rating is added to replace the definition of ‘‘summary rating’’ which is no

longer needed, to permit the performance rating to be recorded in formats other thanpaper, and to acknowledge that non-critical elements are optional.

Performance standard is revised to remove language that implies that management shoulddevelop standards without employee input and to improve clarity.

Progress review is revised to emphasize communication and the legitimacy of team ele-ments and standards.

Rating is deleted because it is not needed.Rating of record is revised to refer to ‘‘performance rating’’ instead of ‘‘summary rating,’’ to

include the assignment of a summary rating level, to remove reference to the Perform-ance Management Plan, to specify that the rating of record generally applies to perform-ance over the entire appraisal period, and to specify that all references to official ratings,performance ratings, and ratings of record in title 5 of the Code of Federal Regulationsrefer to this definition. The purpose of these changes is to clarify the rating process andprovide greater flexibility.

Summary rating is deleted and replaced by a new term, ‘‘performance rating,’’ and lan-guage in the ‘‘rating of record’’ definition (see above) to clarify the rating process andprovide greater flexibility.

§ 430.204(a) ................... § 430.204(a) ................. No change.§ 430.204(b) ................. Proposed rule adds new provision to require agencies to establish agencywide policies and

parameters and sets forth minimum requirements for a system to reflect OPM’s scope ofreview.

§ 430.204(c), ................§ 430.204(d) .................

Proposed rule adds new provision to encourage employee involvement in system and pro-gram development to reflect team settings and NPR goals.

§ 430.205(a) ................. Proposed rule adds new provision that requires agencies to develop at least one appraisalprogram within the scope of agency systems to specify procedures and requirements tooperate the performance appraisal system.

§ 430.205(c) ................. Proposed rule adds new provision that permits the development of separate appraisal pro-grams to implement decentralized performance appraisal.

§ 430.204(b) ................... § 430.206(b)(3),§ 430.207(b),§ 430.208(a)

Proposed rule revises and redesignates provisions requiring performance plans, appraisals,and summary ratings; and permits formats other than paper for recording performanceplans to clarify the rating process and provide greater flexibility.

§ 430.204(c) ................... § 430.206(b)(1) ............. Proposed rule retains provision for employee participation in establishing performanceplans, deletes reference to examples of employee participation in establishing perform-ance plans to eliminate nonessential information, and deletes the provision that super-visory officials have ultimate authority to establish such plans to accommodate team set-tings and support NPR goals.

§ 430.204(d)(1) .............. § 430.206(b)(2)&(3) ...... Proposed rule revises and redesignates the provisions for job-related performance plansprovided at the beginning of the appraisal period to clarify the rating process.

(b)(4) ............................ Proposed rule adds new provision to ensure that at least one element addresses individualperformance.

§ 430.204(d)(2) .............. § 430.206(b)(5) ............. Proposed rule revises and redesignates the provision for the inclusion of organizational ob-jectives in performance plans to provide for team setting and support NPR goals.

§ 430.204(e) ................... § 430.206(b)(6) ............. Proposed rule permits agencies to use as few as two levels to appraise elements to pro-vide greater flexibility (see section in supplementary information above), and continuesrequirement for Fully Successful standard and ability to appraise at levels without explicitstandards.

§ 430.204(f) .................... § 430.206(b)(6)(ii) ......... Proposed rule revises and redesignates requirement for written performance standard anddeletes requirement for higher-level review of performance plans to provide greater flexi-bility.



§ 430.204(g) ................... § 430.208(b) ................. Proposed rule revises and redesignates the requirement for a summary rating method andprovides added flexibility in deriving summary rating levels.

§ 430.204(h) ................... § 430.208(d) ................. Proposed rule permits agencies to use as few as two summary rating levels (Unacceptableand Fully Successful) (see section in supplementary information above) and permits useof other levels to provide greater flexibility.

§ 430.204(i) .................... § 430.208(d)§ 430.209(3).

Proposed rule simplifies regulatory text and replaces the outdated reference to the FederalPersonnel Manual with a reference to the current OPM Guide to Federal Workforce Re-porting Systems.

§ 430.204(j) .................... § 430.207(c)(1) ............. Proposed rule clarifies that agencies are required to assist employees with ‘‘Unacceptable’’performance and deletes examples of assistance to remove nonessential information.

§ 430.204(k) ................... § 430.207(c)() ............... Proposed rule simplifies language addressing unacceptable performance to delete informa-tion stated elsewhere in regulation (performance-based action can be taken either underprocedures established in part 432 or part 752, subpart D).

§ 430.204(1) ................... ...................................... Proposed rule deletes provision requiring ratings of record under one pay system to beused as ratings of record under a new pay system when there is no change in the dutiesand responsibilities of the position to provide greater flexibility.

§ 430.204(a) ................... § 430.206(a) ................. Proposed rule revises and redesignates the requirement for appraisal period and removesthe requirement for agencies to prepare a summary rating when an employee changesposition and to specify how these are taken into account when preparing ratings ofrecord to clarify the rating process and provide greater flexibility.

§ 430.205(b) ................... § 430.207(a) ................. Proposed rule deletes fixed limits on the length of minimum appraisal periods to providegreater flexbility.

§ 430.205(c) ................... § 430.207(b) ................. Proposed rule makes editorial changes to provisions regarding appraising performance oneach element and progress reviews to increase emphasis on communication.

§ 430.205(d) ................... § 430.205(b) ................. Proposed rule replaces requirement to rate employee performance while on detail with re-quirement that programs address the issue to provide greater flexibility.

§ 430.205(e) ................... § 430.207(b) ................. Proposed rule revises and redesignates the requirement for a progress review to increaseemphasis on communication.

§ 430.205(f) .................... § 430.208(f) .................. Proposed rule revises the redesignates and provision regarding rating disabled veterans toclarify rating process.

§ 430.206(a) ................... § 430.208(a) ................. Proposed rule revises and redesignates requirement for rating of record to eliminate re-peating information in the definition and permits agencies to use formats other thanpaper to give ratings of record to employees.

§ 430.206(b) ................... ...................................... Proposed rule deletes a provision repeated in current § 430.205(c) and proposed§ 430.207(b) (see above).

§ 430.206(c) ................... § 430.208(e) ................. Proposed rule limits requirement for higher-level approval to ‘‘Unacceptable’’ ratings ofrecord to provide greater flexibility.

§ 430.206(d) ................... § 430.208(c) ................. Proposed rule revises and redesignates the prohibition of forced distribution, but limits it toratings below Level 3 or to situations where employees are rated only against pre-estab-lished standards, and removes the requirement that agencies establish procedures to en-sure that only those employees who exceed normal expectations receive ratings aboveFully Successful. These changes are made to provide greater flexibility.

§ 430.206(e) ................... § 430.208(g) ................. Proposed rule makes editorial changes to provision regarding extension of appraisal periodto clarify the rating process and provide greater flexibility.

§ 430.206(f) .................... § 430.209(b) ................. Proposed rule revises and redesignates the requirements to transfer ratings of record whenemployees go to a new agency or organization to clarify the rating process.

§ 430.207 ....................... ...................................... Proposed rule deletes reserved secton for performance appraisal advisory committees thatis not needed.

§ 430.208 ....................... § 430.209 (c) & (d) ....... Proposed rule replaces the requirement for training supervisors and employees on the ap-praisal process with requirement to communicate about the relevant parts of thesystem(s) and programs to reflect emphasis on communication and provide graeter flexi-bility, and retains the requirement to evaluate system(s) and programs.

§ 430.209 ....................... § 430.209(g) ................. Proposed rule moves the requirement for agencies to take corrective actions to clarify re-sponsibilities.

§ 430.210 ...................... Proposed rule revises and redesignates OPM role to reflect OPM’s authority to review,evaluate, and direct corrective action.

§ 430.210 ....................... § 430.209(a) ................. Proposed rule clarifies that each agency must submit its performance appraisal system(s)for OPM approval.

Subpart E PerformanceAwards.

...................................... Proposed rule deletes this subpart and combines the provision for performance awards intoother sections of part 451 to integrate awards policy and support NPR goals.

§ 430.501(a) ................... § 451.101 ...................... Proposed rule revises and redesignates the reference to chapter 43, United States Code toaccommodate relocation of information.

§ 430.501(b) ................... § 451.101(c) ................. Proposed rule makes editorial changes to provision regarding definition of employees toaccommodate relocation of information.

§ 430.501(c) ................... § 451.101(c) ................. Proposed rule makes editorial changes to provision regarding definition of agencies to ac-commodate relocation of information.

§ 430.501(d) ................... ...................................... Proposed rule deletes reference to part 451 for regulatory requirements for granting supe-rior accomplishment awards that is no longer needed.

§ 430.502 ....................... ...................................... Proposed rule deletes definitions for performance award, performance award budget, Per-formance Management Plan, and rating of record that are no longer needed.

§ 430.503(a) ................... ...................................... Proposed rule deletes purpose section for performance awards that is no longer needed.§ 430.503(b) ................... § 451.104(a)(3) ............. Proposed rule revises and redesignates the provision to permit use of a rating of record as

the basis for granting an award to accommodate relocation of information.



§ 430.503(c) ................... § 451.106(g) ................. Proposed rule replaces requirement to document awards in OPF with provision for agen-cies to establish criteria to determine which awards to document in OPF to provide great-er flexibility.

§ 430.503(d) ................... § 451.106(h) ................. Proposed rule redesignates provision for giving due weight to awards in promotions withoutchange.

§ 430.503(e) ................... ...................................... Proposed rule deletes recommendation to make maximum use of awards authority to re-move nonessential information.

§ 430.504(a) ................... ...................................... Proposed rule deletes repetition of the statutory percentage limits for performance-basedcash awards at 5 U.S.C. 4505a(a)(2)(A).

§ 430.504(b) ................... § 451.104(b) ................. Proposed rule revises and redesignates the provision that cash awards are paid as lumpsums to accommodate relocation of information.

§ 430.504(c) ................... § 451.104(g) ................. Proposed rule makes editorial changes regarding application of locality pay to clarify lan-guage.

§ 430.504(d) ................... § 451.103(c) ................. Proposed rule replaces higher level review of awards based on a rating of record with re-quirement to follow agency financial management control procedures to give flexibilitywhile maintaining necessary levels of control.

§ 430.504(e) ................... § 451.104(h) ................. Proposed rule moves the provision that a performance-based cash award and its amountcannot be appealed (5 U.S.C. 4505a (b)(2)). Resulting rule covers all awards under thissubpart. This change is made to accommodate relocation of information and to reflectthat appeal rights are granted specifically by statute.

§ 430.505 ....................... ...................................... Proposed rule deletes this section requiring OPM approval of award plans to ease adminis-trative burden.

§ 430.506(a) ................... § 451.103(a) ................. Proposed rule revises and redesignates the provision to establish award programs to sup-port NPR goals.

§ 430.506(b)(1) & (2) ..... ...................................... Proposed rule deletes requirement for OPM approval of agency award plans and changesto them to ease administrative burden.

§ 430.506(b)(3) .............. § 451.106(b) ................. Proposed rule revises and redesignates the requirement for submitting awards in excess of$10,000 to OPM to clarify the approval process.

§ 430.506(b)(4) .............. § 451.106(e) ................. Proposed rule replaces required reports with requirement to report cash and time offawards to CPDF to reduce reporting requirements.

§ 432.103(b) ................... § 432.103(b) ................. Critical element is revised to conform with its new definition in § 430.203.§ 451.101 ....................... § 451.101(a) ................. Proposed rule makes editorial changes to section addressing statutory authority to accom-

modate relocated rating-based award information.§ 451.101(b) ................. Proposed rule adds existing requirement for OPM to prescribe procedures governing pay-

ment of certain types of awards recommended by more than one agency for a memberof the armed forces as provided by Executive Order 11438, and existing authority forOPM approval of requests to extend 5 U.S.C. 4505a to non-General Schedule employ-ees as provided by Executive Order 12828.

§ 451.101(c) ................. Proposed rule combines location of statutory definitions currently in § 451.101(b) & (c).§ 451.101(d) ................. Proposed rule deletes reference to Part 430, subpart E (performance awards) that no

longer applies.§ 451.102 ....................... ...................................... Proposed rule deletes description of superior accomplishment awards because it is not

needed.§ 451.103 ....................... § 451.102 ...................... Award or superior accomplishment award is replaced and revised by Award to accommo-

date team settings; Contribution, Intangible benefits, Non-monetary award, PerformanceManagement Plan, Special act or service (including requirement that contribution be non-recurring), Superior accomplishment award, and Tangible benefits are deleted to in-crease flexibility and because they are not needed to give meaning to the provisions ofpart 451; and a definition for award program is added to support NPR goals.

§ 451.104(a) ................... § 451.103(a) ................. Proposed rule revises and redesignates reference to agency developed program(s) to pro-vide greater flexibility.

§ 451.103(b) ................. Proposed rule adds new provision to encourage employee involvement in system and pro-gram development to support NPR goals.

§ 451.104(a) ................. Proposed rule combines the various bases for granting awards into one section to reflectrelocated information and support NPR goals.

§ 451.104(b) ................... ...................................... Proposed rule deletes an emphasis on determining a contribution’s value to the Govern-ment instead of to the agency to increase flexibility.

§ 451.104(c) ................... ...................................... Proposed rule deletes explicit permission to grant different awards and/or quality step in-creases simultaneously for the same contribution(s) because it is not needed.

§ 451.104(d) ................... ...................................... Proposed rule deletes provision that awards cannot be used as substitutes for pay or otherpersonnel actions because it is not needed.

§ 451.104(e)(1) .............. ...................................... Proposed rule deletes repetition of statutory requirement regarding contributions madewhile a Government employee (5 U.S.C. 4505).

§ 451.104(e)(2) .............. § 451.103(c)(2) ............. Proposed rule revises and redesignates the provision for justification of awards to protectintegrity of award programs.

§ 451.104(e)(3) .............. § 451.103(c)(1) ............. Proposed rule replaces requirement for higher-level review of awards with requirement tofollow agency financial management control procedures to give flexibility while maintain-ing necessary levels of control.

§ 451.104(f) .................... § 451.104(e) ................. Proposed rule redesignates provision for granting awards to heirs or estates, and deletesthe repetition of a statutory requirement (5 U.S.C. 4502 (c)) that acceptance of an awardreleases the Government from further claim.

§ 451.105 ...................... Proposed rule adds new section regarding statutory restrictions on granting awards to sen-ior political officials (5 U.S.C. 4508 and 4509) to clarify coverage.



§ 451.106(a) ................. Proposed rule rule adds new provision that requires agencies to ensure that an award pro-gram does not conflict with any other applicable law or Governmentwide regulation toprotect the integrity of award programs.

§ 451.104(g) ................... § 451.106(i) .................. Proposed rule revises and redesignates the provision permitting agencies to determinewhich awards are to be documented in the OPF to provide greater flexibility.

§ 451.104(h) ................... § 451.106(h) ................. Proposed rule revises and redesignates the provision for giving due weight to awards inpromotions to reflect more accurately the statutory provision.

§ 451.104(i) .................... § 451.106(c) ................. Proposed rule replaces the requirement for agencies to provide training to supervisors andemployees on its award program(s) with requirement to provide for communicating aboutaward program(s) to reflect emphasis on communication and provide greater flexibility.

§ 451.106(d) ................. Proposed rule revises and redesignates the provision requiring agencies to evaluate awardprograms to provide greater flexibility.

§ 451.104(j) .................... § 451.103(c)(1) ............. Proposed rule replaces requirement for higher-level approval of awards with requirement tofollow agency financial management control procedures to give flexibility while maintain-ing necessary levels of control.

§ 451.105(a) ................... § 451.104 (b)&(c) ......... Proposed rule revises and redesignates the provisions regarding award payments and tax-ation to accommodate relocation of information and to clarify requirements.

§ 451.105(b) ................... § 451.104(d)(1) ............. Proposed rule makes editorial changes to paragraph addressing agency responsibility foraward payment when the award is approved for an employee of another agency tostreamline regulatory text.

§ 451.105(c) ................... § 451.104(d)(2) ............. Proposed rule makes editorial changes to paragraph regarding payment of an award ap-proved for a member of the armed forces for a suggestion, invention, or scientificachievement to streamline regulatory text.

§ 451.106(a) ................... ...................................... Proposed rule deletes OPM approval of superior accomplishment awards component ofPerformance Management Plans to ease administrative burden.

§ 451.106(b) ................... § 451.107(a) ................. Proposed rule clarifies that the limits established for award payments apply to individualsonly to provide greater flexibility.

§ 451.107(b) ................. Proposed rule establishes explicitly that Presidential approval is required for award pay-ments over $25,000 that OPM has approved to clarify the award approval process.

§ 451.107(a) ................... ...................................... Proposed rule deletes the requirement to submit a superior accomplishment awards com-ponent of a Performance Management Plan to OPM for approval to ease administrativeburden.

§ 451.107(a)(3) .............. § 451.106(b) ................. Proposed rule makes editorial changes to provision that agencies shall submit to OPM forapproval all award recommendations that would grant an individual more than $10,000 toclarify the award approval process.

§ 451.107(a)(4) .............. § 451.106(e) ................. Proposed rule replaces requirement for an annual report on the program’s activities andexpenditures with a requirement to report all cash and time off awards to the CPDF toreduce reporting requirements.

§ 451.106(f) .................. Proposed rule adds provision for agencies to use OPM Guide to Federal Workforce Re-porting Systems when reporting award data to ensure proper reporting.

§ 451.106(g) ................. Proposed rule permits OPM to define the records it requires to meet the information needsof agencies and other stakeholders.

§ 451.106(j) .................. Proposed rule adds provision requiring agencies to take corrective actions prescribed byOPM to ensure compliance with law and regulation.

§ 451.107(b) ................... ...................................... Proposed rule deletes requirement that agencies consider adopted ideas for wider applica-tion both within the agency and Governmentwide to provide greater flexibility.

§ 451.107(c) ................. Proposed rule adds requirement for OPM to review and determine whether to approve re-quests to extend the provisions of 5 U.S.C. 4505a to non-General Schedule employeesto implement Executive Order 12828.

§ 451.107(d) ................. Proposed rule adds new provision that permits OPM to evaluate the application and oper-ation of agency award program(s) to support OPM’s oversight responsibilities.

§ 451.201 ....................... § 451.201 ...................... Proposed rule adds new sentence to end of paragraph (a) that cautions that Presidentialawards under this paragraph are subject to the restrictions as specified in § 451.105 (thestatutory restrictions at 5 U.S.C. 4508 and 4509) to implement statute.

Subpart C Time OffAwards.

...................................... Proposed rule deletes this subpart and combines the provisions for time-off awards intoother sections of part 451 to integrate awards policy and support NPR goals.

§ 451.306(d) ................... § 451.104(f) .................. Proposed rule redesignates the provision prohibiting the conversion of time off to cash withno change.

§ 531.401(c)&(d) ............ § 531.401(c)&(d) ........... Proposed rule includes the title of Executive Order 11721 and Public Law 103–89 for easi-er reference.

§ 531.402(a) ................... § 531.402(a) ................. Proposed rule replaces reference to maximum step with maximum rate to accommodateGM employees.

§ 531.403 ....................... § 531.403 ...................... Acceptable level of competence is revised to remove reference to duties of the position toconform with definition of critical element at § 430.203 and to include agency head in set-ting requirements to provide greater flexibility.

Critical element is revised to update reference to the redesignated definition section in per-formance appraisal regulation.

Equivalent increase is revised to include reference to higher rate of the grade to accommo-date GM employees.

§ 531.404 ....................... § 531.404 ...................... Proposed rule replaces step 10 with maximum rate of the grade to accommodate GM em-ployees.



§ 531.404(a) ................... § 531.404(a) ................. Proposed rule deletes reference to duties of the position to conform with definition of criti-cal element at § 430.203 and replaces reference to the locus of the rating of record defi-nition from the agency Performance Management Plan to the regulation at § 430.204 toaccommodate regulatory changes.

§ 531.408 ....................... § 531.409(b) ................. Proposed rule revises and redesignates provisions for communicating performance require-ments by including a reference to subpart B, replacing appraisal requirements by OPMfor systems not under part 430 with agency-established requirements, and making othereditorial changes to conform with revised terms in part 430 to provide greater flexibility.

§ 531.409(c)(2) ............. Proposed rule adds new provision to permit opportunity period and notice period as rea-sons for delay of an ALOC (acceptable level of competence) determination to providegreater flexibility.

§ 531.409(c)(2) (i) & (iii) § 531.409(c)(3) (i) & (iii) Proposed rule redesignates provisions regarding within-grade increase delays with nochange.

§ 531.409(c)(2)(ii) .......... § 531.409(c)(3)(ii) ......... Proposed rule makes editorial changes to conform with the revised terms in part 430 andto reference opportunity period.

§ 531.409(c)(3)(iv) ........ Proposed rule adds requirement that within-grade increase is not granted if performance isnot at an acceptable level of competence and references follow-up procedures to clarifythe within-grade increase process.

§ 531.409(d) ................... § 531.409(d) ................. Proposed rule makes editorial changes to conform with the revised terms in part 430.§ 531.409(d)(5) ............. Proposed rule adds new provision that includes 100% time spent on authorized activities of

official interest to the agency as a reason to waive an ALOC determination to grantgreater flexibility.

§ 531.409(d)(5) .............. § 531.409(d)(6) ............. Proposed rule redesignates provision regarding long-term training with no change.§ 531.501 ....................... § 531.501 ...................... Proposed rule includes the title of Executive Order 11721 for easier reference and removes

partial content of the Executive Order from regulation because it is not needed.§ 531.503 ....................... § 531.503 ...................... Proposed rule establishes a merit system principle rather than referencing recognition of

outstanding performance as the context for granting QSI’s to accommodate regulatorychange at § 531.504.

§ 531.504 ....................... § 531.504 ...................... Proposed rule revises the provision to permit agencies that choose not to have a Level 5rating in their appraisal programs to establish performance-related criteria to grant QSI’sto provide greater flexibility.

§ 531.506 ....................... § 531.506 ...................... Proposed rule removes reference to completion of rating of record and ties effective date toapproval of QSI to provide greater flexibility.

§ 531.507 ....................... ...................................... Proposed rule removes requirement to include QSI plan as part of Performance Manage-ment Plan to ease administrative burden.

§ 531.507(a)-(e) ............. § 531.507(a) ................. Proposed rule references rather than repeats the requirements of Executive Order 11721because they are not needed.

§ 531.508(a) ................... § 531.507(b) ................. Proposed rule revises and redesignates requirement for reporting QSI usage to clarify re-sponsibility.

§ 531.507(c) ................. Proposed rule requires use of OPM’s Guide to Federal Workforce Reporting Systems forCPDF reporting to ensure proper reporting.

§ 531.508(b) ................... § 531.508 ...................... Proposed rule redesignates the provision for OPM evaluation with no change in text.

E.O. 12866, Regulatory Review

This rule has been reviewed by theOffice of Management and Budget inaccordance with E.O. 12866.

Regulatory Flexibility Act

I certify that these regulations will nothave a significant economic impact ona substantial number of small entitiesbecause they apply only to Federalagencies and employees.

List of Subjects


Decorations, medals, awards,Government employees.

5 CFR Part 432

Administrative practice andprocedure, Government employees.

5 CFR Part 531

Government employees, Lawenforcement officers, Wages.

U.S. Office of Personnel Management.James B. King,Director.

Accordingly, OPM is proposing toamend parts 430, 432, 451 and 531 oftitle 5, Code of Federal Regulations, asfollows:

PART 430—PERFORMANCEMANAGEMENT

1. The authority citation for part 430is revised to read as follows:

Authority: 5 U.S.C. chapter 43.

2. Subpart A is revised to read asfollows:

Subpart A—Performance Management

Sec.430.101 Authority.430.102 Performance management.

Subpart A—Performance Management

§ 430.101 Authority.Chapter 43 of title 5, United States

Code, provides for performance

appraisal of Federal employees. Thissubpart supplements and implementsthis portion of the law.

§ 430.102 Performance management.

(a) Performance management is thesystematic process by which an agencyinvolves its employees, as individualsand members of a group, in improvingorganizational effectiveness in theaccomplishment of agency mission andgoals.

(b) Performance managementintegrates the processes an agency usesto—

(1) Communicate and clarifyorganizational goals to employees;

(2) Identify individual and, whereapplicable, team accountability foraccomplishing organizational goals;

(3) Identify and addressdevelopmental needs for individualsand, where applicable, teams;

(4) Assess and improve individualand organizational performance;


(5) Use appropriate measures ofperformance as the basis for recognizingand rewarding accomplishments; and

(6) Use the results of performanceappraisal as a basis for appropriatepersonnel actions.

(c) A Performance Management Planis the description of an agency’sframework for implementing all aspectsof performance management and shallinclude, but not be limited to, theagency performance appraisal system(s)(as defined in §§ 430.203 and 430.303)and the agency award program(s) (asdefined in § 451.102).

3. Subpart B, consisting of §§ 430.201through 430.210, is revised to read asfollows:

Subpart B—Performance Appraisal forGeneral Schedule, Prevailing Rate, andCertain Other Employees

Sec.430.201 General.430.202 Coverage.430.203 Definitions.430.204 Agency performance appraisal

system(s).430.205 Agency performance appraisal

program(s).430.206 Planning performance.430.207 Monitoring performance.430.208 Rating performance.430.209 Agency responsibilities.430.210 OPM responsibilities.

Subpart B—Performance Appraisal forGeneral Schedule, Prevailing Rate, andCertain Other Employees

§ 430.201 General.

(a) Statutory authority. Chapter 43 oftitle 5, United States Code, provides forthe establishment of agencyperformance appraisal systems andrequires the Office of PersonnelManagement (OPM) to prescriberegulations governing such systems. Theregulations in this subpart incombination with statute set forth therequirements for agency performanceappraisal system(s) and program(s) foremployees covered by subchapter I ofchapter 43.

(b) Savings provision. Theperformance appraisal system portion ofan agency’s performance managementplan approved by OPM as of theeffective date of these regulations shallconstitute an approved performanceappraisal system under theseregulations until such time changes tothe system are approved. No provisionof these regulations shall be applied insuch a way as to affect anyadministrative proceeding related to anyaction taken under regulations in thischapter pending at the effective date ofthe regulations in this subpart.

§ 430.202 Coverage.(a) Employees and agencies covered

by statute. (1) Section 4301(1) of title 5,United States Code, defines agenciescovered by this subpart.

(2) Section 4301(2) of title 5, UnitedStates Code, defines employees coveredby statute by this subpart. BesidesGeneral Schedule (GS/GM) andprevailing rate employees, coverageincludes, but is not limited to, senior-level and scientific and professionalemployees paid under 5 U.S.C. 5376.

(b) Statutory exclusions. This subpartdoes not apply to agencies or employeesexcluded by 5 U.S.C. 4301(1) and (2),the United States Postal Service, or thePostal Rate Commission.

(c) Administrative exclusions. OPMmay exclude any position or group ofpositions in the excepted service underthe authority of 5 U.S.C. 4301(2)(G).This regulation excludes exceptedservice positions for which employmentis not reasonably expected to exceed theminimum period established by theagency under § 430.207(a) in aconsecutive 12-month period.

(d) Agency requests for exclusions.Heads of agencies or their designeesmay request the Director of OPM toexclude positions in the exceptedservice. The request must be in writing,explaining why the exclusion would bein the interest of good administration.

§ 430.203 Definitions.In this subpart, terms are defined as

follows:Appraisal means the process under

which performance is reviewed andevaluated.

Appraisal period means the period oftime (generally 1 year) established by anagency for which performance will bereviewed and a rating of record will beprepared.

Appraisal program means the specificprocedures and requirementsestablished by an agency or thecomponents of an agency within thepolicies and parameters covered by theagency appraisal system(s).

Appraisal system means theframework of agencywide policies andparameters for the administration ofperformance appraisal programsestablished under subchapter I ofchapter 43 of title 5, United States Code,and this subpart within an agency asdefined at 5 U.S.C. 4301(1).

Critical element means a workassignment or responsibility of suchimportance that unacceptableperformance on the element wouldresult in a determination that overallperformance is unacceptable.

Performance means accomplishmentof work assignments or responsibilities.

Performance appraisal system: seeAppraisal system.

Performance plan means all of thewritten, or otherwise recorded,individual, team, or organizationalperformance factors that lead to theassignment of an employee’s summaryrating level. A plan contains the criticalelements based on employeeassignments and responsibilities, andtheir related performance standard(s),and may contain other performance-related factors including, but not limitedto, non-critical elements.

Performance rating means the written,or otherwise recorded, appraisal ofperformance compared to theperformance standard(s) for each criticalelement (and non-critical element,where applicable) on which there hasbeen an opportunity to perform for theminimum period.

Performance standard means themanagement-approved expression of theperformance threshold(s),requirement(s), or expectation(s) for anelement that must be met to beappraised at a particular level ofperformance (as specified in§ 430.206(b)(6)(i) of this subpart). Aperformance standard may include, butis not limited to, factors such as quality,quantity, timeliness, and manner ofperformance.

Progress review meanscommunicating with the employeeabout performance on individual and,where applicable, team elements andstandard(s).

Rating of record means theperformance rating prepared at the endof an appraisal period (under provisionsspecified by the agency) for performanceover the entire period and theassignment of a summary rating level (asspecified in § 430.208(d)). Thisconstitutes the official rating of recordreferenced in this chapter.

§ 430.204 Agency performance appraisalsystem(s).

(a) Each agency as defined at section4301(1) of title 5, United States Code,shall develop one or more performanceappraisal systems for employeescovered by this subpart.

(b) The agency system(s) shallestablish agencywide policies andparameters for the application andoperation of performance appraisalwithin the agency. At a minimum, anagency system shall—

(1) Provide for—(i) Establishing employee performance

plans, including, but not limited to,critical elements and performancestandards;


(ii) Communicating performanceplans to employees at the beginning ofan appraisal period;

(iii) Evaluating each employee duringthe appraisal period on the employee’selements and standards;

(iv) Recognizing and rewardingemployees whose performance sowarrants;

(v) Assisting employees in improvingunacceptable performance; and

(vi) Reassigning, reducing in grade, orremoving employees who continue tohave unacceptable performance, butonly after an opportunity to demonstrateacceptable performance.

(2) Identify employees covered by thesystem;

(3) Establish the permissible values(including, but not limited to, number ofdays and number of levels) that anagency program may use for—

(i) The appraisal period (as specifiedin § 430.206(a));

(ii) The minimum period (as specifiedin § 430.207(a));

(iii) The number(s) of performancelevels at which elements shall beappraised (as specified in§ 430.206(b)(6)); and

(iv) The number of summary ratinglevels that may be assigned in a ratingof record (as specified in § 430.208(d));and

(4) Include, where applicable, criteriaand procedures for establishing separateappraisal programs within the agency;and

(5) Require that an agency appraisalprogram shall conform to statute and theregulations of this chapter.

(c) Agencies are encouraged toinvolve employees and theirrepresentatives in developing andimplementing their system(s).

§ 430.205 Agency performance appraisalprogram(s).

(a) Each agency shall establish at leastone appraisal program of specificprocedures and requirements to beimplemented in accordance with theagency’s appraisal system(s). At aminimum, each appraisal program shallinclude procedures and requirementsfor planning performance as specified in§ 430.206, monitoring performance asspecified in § 430.207, and ratingperformance as specified in § 430.208.

(b) An agency program shall establishcriteria and procedures to addressemployee performance for employeeswho are on detail, who are transferred,or for other special circumstances asestablished by the agency.

(c) An agency may permit thedevelopment of separate appraisalprograms under the framework of itsappraisal system(s).

(d) Agencies are encouraged toinvolve employees and theirrepresentatives in developing andimplementing their program(s).

§ 430.206 Planning performance.(a) Appraisal period. (1) An appraisal

program shall designate an officialappraisal period for which aperformance plan shall be prepared,during which performance shall bemonitored, and for which a rating ofrecord shall be prepared.

(2) The appraisal period shallgenerally be designated so thatemployees shall be provided a rating ofrecord on an annual basis. An appraisalprogram may provide that longerappraisal periods may be designatedwhen work assignments andresponsibilities so warrant orperformance management objectives canbe achieved more effectively.

(b) Performance plan. (1) Agenciesshall encourage employee participationin establishing performance plans.

(2) Performance plans shall beprovided to employees at the beginningof each appraisal period (normallywithin 30 days).

(3) An appraisal program shall requirethat each employee be covered by anappropriate written, or otherwiserecorded, performance plan based onwork assignments and responsibilities.

(4) Each performance plan shallinclude at least one critical element thataddresses individual performance.

(5) When appropriate, performanceplans may also include accomplishmentof team, group, or organizationalobjectives by incorporating elements,objectives, goals, program plans, workplans, or by other similar means thataccount for program results.

(6) (i) An appraisal program shallprovide for establishing the number oflevels at which performance on anelement may be appraised. At aminimum, two levels shall be used,with one level being ‘‘Fully Successful’’or its equivalent and another level being‘‘Unacceptable.’’

(ii) A performance standard shall beestablished at the ‘‘Fully Successful’’level for each element and may beestablished at other levels.

(iii) The absence of an establishedstandard at a level specified in theprogram shall not preclude adetermination that performance is atthat level.

§ 430.207 Monitoring performance.(a) Minimum period. An appraisal

program shall establish a minimumperiod before any performancedetermination can be made.

(b) Ongoing appraisal. An appraisalprogram shall include methods for

appraising each element in theperformance plan during the appraisalperiod, unless there has beeninsufficient opportunity to demonstrateperformance on the element. Suchmethods shall include, but not belimited to, conducting one or moreprogress reviews during each appraisalperiod.

(c) Unacceptable performance. At anytime during the appraisal period thatperformance is determined to beunacceptable in one or more criticalelements, an appraisal program shallprovide for—

(1) Assisting employees in improvingunacceptable performance; and

(2) Taking action based onunacceptable performance.

§ 430.208 Rating performance.(a) As soon as practicable after the

end of the appraisal period, a written, orotherwise recorded, rating of recordshall be given to each employee.

(b) Rating of record procedures foreach appraisal program shall include amethod for deriving a summary ratingand assigning a summary rating level asspecified in paragraph (d) of this sectionbased at a minimum on appraisal ofperformance on critical elements, and,at agency discretion, consideration ofother performance-related factorsincluding, but not limited to, appraisalof performance on non-critical elements.

(1) A summary rating above Level 1(‘‘Unacceptable’’) shall not be assignedif performance on any critical elementhas been appraised as ‘‘Unacceptable.’’

(2) Consideration of otherperformance-related factors shall notresult in assigning a summary rating ofLevel 1 (‘‘Unacceptable’’) if each criticalelement has been appraised at least‘‘Fully Successful’’ (or equivalent).

(c) An appraisal program shall notestablish a forced distribution ofsummary ratings—

(1) Below Level 3 (‘‘Fully Successful’’or equivalent); or

(2) If those summary ratings arederived solely from an appraisal ofperformance against pre-establishedstandards.

(d) Summary rating levels. (1) Anappraisal program shall provide for—

(i) At least two and not more than fivesummary rating levels;

(ii) A Level 1 (‘‘Unacceptable’’)summary rating level; and

(iii) A Level 3 (‘‘Fully Successful’’ orequivalent) summary rating level.

(2) If more than two summary ratinglevels are used, agencies may providefor any combination of additionalsummary rating levels (Level 2, Level 4,and Level 5) provided that—

(i) Level 2, if used, is a rating levelabove Level 1 and below Level 3; and


(ii) Level 4, if used, is a rating levelabove Level 3 and below Level 5(‘‘Outstanding’’ or equivalent), if used.

(3) The term ‘‘Outstanding’’ shall beused only to describe a Level 5summary rating level.

(4) The summary rating leveldesignator (Level 1 through Level 5)shall be used to provide consistency indescribing ratings of record and inreferencing other related regulations(including, but not limited to, § 351.504of this chapter).

(e) A rating of record of‘‘Unacceptable’’ (Level 1) shall bereviewed and approved by a higherlevel management official.

(f) The rating of record or performancerating for a disabled veteran shall not belowered because the veteran has beenabsent from work to seek medicaltreatment as provided in ExecutiveOrder 5396.

(g) When a rating of record cannot beprepared at the time specified, theappraisal period shall be extended.Once the conditions necessary tocomplete a rating of record have beenmet, a rating of record shall be preparedas soon as practicable.

(h) A performance rating may beprepared at such other times as anappraisal program may specify forspecial circumstances including, but notlimited to, transfers and performance ondetails.

§ 430.209 Agency responsibilities.An agency shall—(a) Submit to OPM for approval a

description of its appraisal system(s) asspecified in § 430.204(b) of this subpart,and any subsequent changes that modifyany element of the agency’s system(s)that is subject to a regulatoryrequirement in this part;

(b) Transfer the employee’s mostrecent rating of record, and anysubsequent performance ratings, whenan employee transfers to another agencyor is assigned to another organizationwithin the agency;

(c) Require communication withsupervisors and employees aboutrelevant parts of its performanceappraisal system(s) and program(s);

(d) Evaluate the performanceappraisal system(s) contained in itsPerformance Management Plan andperformance appraisal program(s) inoperation in the agency;

(e) Use OPM’s Guide to FederalWorkforce Reporting Systems to reportratings of record data to the CPDF;

(f) Maintain and submit such recordsas OPM may require; and

(g) Take any action required by OPMto ensure conformance with applicablelaw, regulation, and OPM policy.

§ 430.210 OPM responsibilities.(a) OPM shall review and approve an

agency’s performance appraisalsystem(s).

(b) OPM may evaluate the operationand application of an agency’sperformance appraisal system(s) andprogram(s).

(c) If OPM determines that anappraisal system or program does notmeet the requirements of applicablelaw, regulation, or OPM policy, it shalldirect the agency to implement anappropriate system or program or to takeother corrective action.

4. Subpart D [Reserved] and SubpartE, consisting of §§ 430.501 through430.506, are removed.

PART 432—PERFORMANCE BASEDREDUCTION IN GRADE ANDREMOVAL ACTIONS


Authority: 5 U.S.C. 4303, 4305.

6. In § 432.103, paragraph (b) isrevised to read as follows:


* * * * *(b) Critical element means a work

assignment or responsibility of suchimportance that unacceptableperformance on the element wouldresult in a determination that overallperformance is unacceptable.* * * * *

PART 451—AWARDS

7. The heading of part 451 is revisedto read as follows:

PART 451—AWARDS


Authority: 5 U.S.C. 4302, 4501–4507; E.O.11438, 12828.

9. Subpart A, consisting of §§ 451.101through 451.107, is revised to read asfollows:

Subpart A—Agency Awards

Sec.451.101 Authority and Coverage.451.102 Definitions.451.103 Agency award program(s).451.104 Awards.451.105 Award restrictions.451.106 Agency responsibilities.451.107 OPM responsibilities.

Subpart A—Agency Awards

§ 451.101 Authority and coverage.(a) Chapter 45 of title 5, United States

Code authorizes agencies to pay a cashaward to, grant time-off to, and incurnecessary expense for the honorary

recognition of, an employee(individually or as a member of a group)and requires the Office of PersonnelManagement to prescribe regulationsgoverning such authority. Chapter 43 oftitle 5, United States Codes provides forrecognizing and rewarding employeeswhose performance so warrants. Theregulations in this subpart, incombination with the chapters 43 and45, United States Code, and any otherapplicable law, establish therequirements for agency awardprograms.

(b) Section 4 of E.O. 11438(Prescribing Procedures GoverningInterdepartmental Cash Awards to theMembers of the Armed Forces,December 3, 1968) requires the Office ofPersonnel Management to prescribeprocedures for covering the cost of acash award recommended by more thanone agency for a member of the armedforces for the adoption or use of asuggestion, invention, or scientificachievement. Section 1 of E.O. 12828(Delegation of Certain PersonnelManagement Authorities, January 5,1993) delegates to the Office ofPersonnel Management the authority ofthe President to permit performance-based cash awards under 5 U.S.C. 4505ato be paid to categories of employeeswho would not be eligible otherwise.

(c) This subpart applies to employeesas defined by section 2105 and agenciesas defined by section 4501 of title 5,United States Code, except as providedin §§ 451.105 and 451.201(a).

(d) For the regulatory requirements forgranting performance awards to SeniorExecutive Service (SES) employeesbased on an employee’s performanceappraisal and rating of record, refer to§ 534.403 of this chapter.

§ 451.102 Definitions.Award means something bestowed or

an action taken to recognize and rewardindividual or team achievement thatcontributes to meeting organizationalgoals or improving the efficiency,effectiveness, and economy of theGovernment or is otherwise in thepublic interest. Such awards include,but are not limited to, employeeincentives (e.g., agency productivitygainshares), which are based onpredetermined criteria such asproductivity standards, performancegoals, measurement systems, awardformulas, or payout schedules.

Award program means the specificprocedures and requirementsestablished by an agency or acomponent of an agency for grantingawards under subchapter I of chapter 43and of chapter 45 of title 5, UnitedStates Code, and this subpart.


§ 451.103 Agency award program(s).(a) Agencies shall develop one or

more award programs for employeescovered by this subpart.

(b) Agencies are encouraged toinclude employees and theirrepresentatives in developing suchprograms.

(c) An agency award program shallprovide for—

(1) Obligating funds consistent withapplicable agency financial managementcontrols and delegations of authority;and

(2) Documenting justification forawards that are not based on a rating ofrecord (as defined in § 430.203 of thischapter).

§ 451.104 Awards.(a) An agency may grant a cash,

honorary, or informal recognitionaward, or grant time-off without chargeto leave or loss of pay consistent withchapter 45 of title 5, United States Code,and this part to an employee, as anindividual or member of a group, on thebasis of—

(1) A suggestion, invention, superioraccomplishment, or other personaleffort that contributes to the efficiency,economy, or other improvement ofGovernment operations or achieves asignificant reduction in paperwork;

(2) A special act or service in thepublic interest in connection with orrelated to official employment; or

(3) Performance as reflected in theemployee’s most recent rating of record(as defined in § 430.203 of this chapter),except that such awards may be paid toSES employees only under § 534.403 ofthis chapter and not on the basis of thissubpart.

(b) A cash award under this subpartis a lump sum in addition to regular payand does not increase an employee’srate of basic pay.

(c) An award is subject to thewithholding of taxes.

(d) When an award is approved for—(1) An employee of another agency,

the benefiting agency shall makearrangements to transfer funds to theemploying agency to cover the award. Ifthe administrative costs of transferringfunds would exceed the amount of theaward, the employing agency shallabsorb the award costs and pay theaward; and

(2) A member of the armed forces fora suggestion, invention, or scientificachievement, arrangements shall bemade to transfer funds to the agencyhaving jurisdiction over the member inaccordance with E.O. 11438,‘‘Prescribing Procedures GoverningInterdepartmental Cash Awards to theMembers of the Armed Forces’’.

(e) An award may be granted to thelegal heirs or estates of deceasedemployees.

(f) A time-off award granted underthis subpart shall not be converted to acash payment under any circumstances.

(g) When granting an award on thebasis of a rating of record that is paidas a percentage of basic pay under 5U.S.C. 4505a(a)(2)(A), the rate of basicpay used shall be determined withouttaking into account any locality-basedcomparability payment under 5 U.S.C.5304 or an interim geographicadjustment or special law enforcementadjustment under section 302 or 404 ofthe Federal Employees PayComparability Act of 1990, respectively.

(h) Employees may not appeal anagency’s decision not to grant an awardor the amount of such an award. Thisdoes not affect any right or remedyunder subchapter II of chapter 12,chapter 71, or section 2302(d) of title 5,United States Code.

§ 451.105 Award restrictions.(a) Agencies shall not grant awards

under this subpart during a Presidentialelection period (as defined at 5 U.S.C.4508) to employees who are—

(1) In the Senior Executive Serviceand not career appointees (i.e., non-career or limited appointees), or

(2) In an excepted service position ofa confidential or policy-determiningcharacter (schedule C).

(b) Agencies shall not grant cashawards under this subpart to employeesappointed by the President with Senateconfirmation who serve in—

(1) An Executive Schedule position,or

(2) A position for which pay is set instatute by reference to a section or levelof the Executive Schedule.

§ 451.106 Agency responsibilities.(a) In establishing and operating its

award program(s), an agency shallassure that a program does not conflictwith or violate any other law orGovernmentwide regulation.

(b) When a recommended awardwould grant over $10,000 to anindividual employee, the agency shallsubmit the recommendation to OPM forapproval.

(c) Agencies shall provide forcommunicating with employees andsupervisors about the relevant parts oftheir award program(s).

(d) Agencies shall evaluate theiraward program(s).

(e) Agencies shall report all cash andtime off awards to the CPDF.

(f) Agencies shall use OPM’s Guide toFederal Workforce Reporting Systems toreport award data to the CPDF.

(g) Agencies shall maintain andsubmit such records as OPM mayrequire.

(h) Agencies shall give due weight toan award granted under this part inqualifying and selecting an employee forpromotion as provided in 5 U.S.C. 3362.

(i) Agencies shall establish criteria foridentifying which awards to documentin the Official Personnel Folder inconformance with OPM’s Guide toPersonnel Recordkeeping.

(j) Agencies shall take any correctiveaction required by OPM to ensureconformance with applicable law,regulation, and OPM policy.

§ 451.107 OPM responsibilities.(a) OPM shall review and approve or

disapprove each agencyrecommendation for an award thatwould grant over $10,000 to anindividual employee.

(b) When a recommended awardwould grant over $25,000 to anindividual employee, OPM shall reviewthe recommendation and submit it (ifapproved) to the President for finalapproval.

(c) OPM shall review and approve ordisapprove a request from the head ofan Executive agency to extend theprovisions of 5 U.S.C. 4505a to anycategory of employees within thatagency that would not be coveredotherwise.

(d) OPM may evaluate the operationand application of an agency’s awardprogram(s).

10. In § 451.201, the secondintroductory paragraph (a) is removed,paragraph (b), (c), and (d) areredesignated as paragraphs (c), (d), and(e) respectively, and a new paragraph (b)is added to read as follows:

§ 451.201 Authority and coverage.

* * * * *(b) Awards granted under paragraph

(a) are subject to the restrictions asspecified in § 451.105.* * * * *

11. Subpart C, consisting of§§ 451.301 through 451.307, is removed.

PART 531—PAY UNDER THEGENERAL SCHEDULE


Authority: 5 U.S.C. 5115, 5307, and 5338;sec. 4 of Pub. L. 103–89, 107 Stat. 981; andE.O. 12748, 56 FR 4521, February 4, 1991, 3CFR 1991 Comp., p. 316;

Subpart A also issued under 5 U.S.C.5304, 5305, and 5553; section 302 of theFederal Employees Pay ComparabilityAct of 1990 (FEPCA), Pub. L. 101–509,104 Stat. 1462; and E.O. 12786, 56 FR


67453, December 30, 1991, 3 CFR 1991Comp., p. 376;

Subpart B also issued under 5 U.S.C.5303(g), 5333, 5334(a), and 7701(b)(2);

Subpart C also issued under 5 U.S.C.5304, 5305, and 5553; sections 302 and404 of FEPCA, Pub. L. 101–509, 104Stat. 1462 and 1466; and section 3(7) ofPub. L. 102–378, 106 Stat. 1356;

Subpart D also issued under 5 U.S.C.5335(g) and 7701(b)(2);

Subpart E also issued under 5 U.S.C.5336;

Subpart F also issued under 5 U.S.C.5304, 5305(g)(1), and 5553; and E.O.12883, 58 FR 63281, November 29,1993, 3 CFR 1993 Comp., p. 682.

13. In § 531.401, paragraphs (c) and(d) are revised to read as follows:

§ 531.401 Principal authorities.

* * * * *(c) Section 402 of E.O. 11721

(Providing for Federal PayAdministration, May 23, 1973), asamended, provides that ‘‘The CivilService Commission (Office ofPersonnel Management) shall issue suchregulations and standards as may benecessary to ensure that only thoseemployees whose work is of anacceptable level of competence receiveperiodic step-increases under theprovisions of section 5335 of title 5,United States Code.’’

(d) Section 4 of Public Law 103–89(Performance Management andRecognition System Termination Act of1993) provides that ‘‘the Office ofPersonnel Management shall prescriberegulations necessary for theadministration of this section.’’

14. In § 531.402, paragraph (a) isrevised to read as follows:

§ 531.402 Employee coverage.(a) Except as provided in paragraph

(b) of this section, this subpart appliesto employees who occupy permanentpositions classified and paid under theGeneral Schedule and who are paid atless than the maximum rate of theirgrades.* * * * *

15. In § 531.403, the definitions ofacceptable level of competence, criticalelement, and equivalent increase arerevised to read as follows:


* * * * *Acceptable level of competence

means performance by an employee thatwarrants advancement of theemployee’s rate of basic pay to the nexthigher step of the grade (or, in the caseof a GM employee, the next higher ratewithin the grade) of his or her position,subject to the requirements of § 531.404

of this subpart, as determined by thehead of the agency.* * * * *

Critical element has the meaninggiven that term in § 430.203 of thischapter.* * * * *

Equivalent increase means an increaseor increases in an employee’s rate ofbasic pay equal to or greater than thedifference between the employee’s rateof basic pay and the rate of pay for thenext higher step of that grade (or, in thecase of a GM employee, the next higherrate within the grade).* * * * *

16. In § 531.404, the introductory text,and the introductory text of paragraph(a) are revised to read as follows:

§ 531.404 Earning within-grade increase.An employee paid at less than the

maximum rate of the grade of his or herposition shall earn advancement in payto the next higher step of the grade orthe next higher rate within the grade (asdefined in § 531.403) upon meeting thefollowing three requirementsestablished by law:

(a) The employee’s performance mustbe at an acceptable level of competence,as defined in this subpart by authorityof section 402 of E.O. 11721, asamended. To be determined at anacceptable level of competence, theemployee’s most recent rating of record(as defined in § 430.203 of this chapter)shall be at least Level 3 (‘‘FullySuccessful’’ or equivalent).* * * * *

17. Section 531.408 is removed andreserved.

§ 531.408 [Reserved].18. In § 531.409, paragraph (b) is

revised, paragraph (c)(2) is redesignatedas paragraph (c)(3) and revised, a newparagraph (c)(2) is added, theintroductory text to paragraph (d) isrevised, paragraph (d)(4) is revised,paragraph (d)(5) is redesignated asparagraph (d)(6), a new paragraph (d)(5)is added, and the concluding text at theend of paragraph (d) is revised to readas follows:

§ 531.409 Acceptable level of competencedeterminations.* * * * *

(b) Basis for determination. Whenapplicable, an acceptable level ofcompetence determination shall bebased on a current rating of record madeunder part 430, subpart B, of thischapter. For those agencies not coveredby chapter 43 of title 5, United StatesCode, and for employees in positionsexcluded from 5 U.S.C. 4301, anacceptable level of competence

determination shall be based onperformance appraisal requirementsestablished by the agency. If anemployee has been reduced in gradebecause of unacceptable performanceand has served in one position at thelower grade for at least the minimumperiod established by the agency, arating of record at the lower grade shallbe used as the basis for an acceptablelevel of competence determination.

(c) * * *(2) An acceptable level of competence

determination may be delayed during anemployee’s opportunity to demonstrateacceptable performance (as defined at§ 432.103(d)) of this chapter or during anotice period for a proposedperformance-based action under part432 or 752 of this chapter.

(3) When an acceptable level ofcompetence determination has beendelayed under this subpart:

(i) The employee shall be informedthat his or her determination ispostponed and, where applicable, therating period extended and shall be toldof the specific requirements forperformance at an acceptable level ofcompetence.

(ii) An acceptable level of competencedetermination shall then be made uponcompletion of either the minimumperiod established by the agency or theopportunity to demonstrate acceptableperformance.

(iii) If, following the delay, theemployee’s performance is determinedto be at an acceptable level ofcompetence, the within-grade increaseshall be granted retroactively to thebeginning of the pay period followingcompletion of the applicable waitingperiod.

(iv) If, following the delay, theemployee’s performance is determinednot to be at an acceptable level ofcompetence, the within-grade increaseshall not be granted. The provisions of§ 531.411 govern the determination ofan employee’s acceptable level ofcompetence following the withholdingof a within-grade increase.

(d) Waiver of requirement fordetermination. An acceptable level ofcompetence determination shall bewaived and a within-grade increasegranted when an employee has notserved in any position for the minimumperiod under an applicable agencyperformance appraisal program duringthe final 52 calendar weeks of thewaiting period for one or more of thefollowing reasons:* * * * *

(4) Because of details to anotheragency or employer for which no ratinghas been prepared;


(5) Because the employee has hadinsufficient time to demonstrate anacceptable level of competence due toauthorized activities of official interestto the agency not subject to appraisalunder part 430 of this chapter(including, but not limited to, labor-management partnership activitiesunder section 2 of Executive Order12871 and serving as a representative ofa labor organization); or* * * * *

In such a situation, there shall be apresumption that the employee wouldhave performed at an acceptable level ofcompetence had the employeeperformed the duties of his or herposition of record for the minimumperiod under the applicable agencyperformance appraisal program.

19. Section 531.501 is revised to readas follows:

§ 531.501 Applicability.This subpart contains regulations of

the Office of Personnel Management tocarry out section 5336 of title 5, UnitedStates Code, which authorizes the headof an agency, or another official towhom such authority is delegated, togrant quality step increases, and to carryout section 403 of Executive Order11721 (Providing for Federal Pay

Administration, May 23, 1973), asamended.


§ 531.503 Purpose of quality stepincreases.

The purpose of quality step increasesis to provide appropriate incentives andrecognition for excellence inperformance by granting faster thannormal step increases.


§ 531.504 Level of performance requiredfor quality step increase.

A quality step increase shall not berequired but may be granted only to—

(a) An employee who receives a ratingof record at Level 5 (‘‘Outstanding’’ orequivalent), as defined in part 430,subpart B, of this chapter; or

(b) An employee who is covered by aperformance appraisal program thatdoes not have a Level 5 rating and whodemonstrates sustained performance ofhigh quality significantly above thatexpected at the ‘‘Fully Successful’’ levelin the type of position concerned, asdetermined under performance-relatedcriteria established by the agency.


§ 531.506 Effective date of a quality stepincrease.

The quality step increase should bemade effective as soon as practicableafter it is approved.


§ 531.507 Agency responsibilities.

(a) Agencies shall develop andimplement a plan(s) for granting qualitystep increases in accordance withExecutive Order 11721.

(b) Agencies shall maintain and reportsuch records as the Office may require.

(c) Agencies shall use OPM’s Guide toFederal Workforce Reporting Systems toreport quality step increases to theCPDF.


§ 531.508 Evaluation of quality stepincrease authority.

The Office of Personnel Managementmay evaluate an agency’s use of theauthority to grant quality step increases.The agency shall take any correctiveaction required by the Office.


i

Reader Aids Federal Register

Vol. 60, No. 18


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LawsPublic Laws Update Service (numbers, dates, etc.) 523–6641Additional information 523–5230

Presidential DocumentsExecutive orders and proclamations 523–5230Public Papers of the Presidents 523–5230Weekly Compilation of Presidential Documents 523–5230

The United States Government ManualGeneral information 523–5230

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FEDERAL REGISTER PAGES AND DATES, JANUARY

1–318.......................................3319–1706.................................41707–1988...............................51989–2320...............................62321–2492...............................92493–2670.............................102671–2872.............................112873–3054.............................123055–3334.............................13

3335–3532.............................173533–3724.............................183725–4068.............................194069–4370.............................204371–4526.............................234527–4830.............................244831–5086.............................255087–5308.............................265309–5558.............................27

CFR PARTS AFFECTED DURING JANUARY

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 sincethe revision date of each title.

3 CFRProclamations:5759 (See Proc.

6763) ..............................10076455 (See Proc.

6763) ..............................10076641 (See Proc.

6763) ..............................10076726 (See Proc.

6763) ..............................10076763...................................10076764...................................30536765...................................33336766...................................4067Executive Orders:12640 (Amended by

EO 12945)......................452712826 (Superseded by

12944) ..............................30912886 (Superseded by

12944) ..............................30912944...................................30912945.................................452712946.................................482912947.................................5079Administrative Orders:Memorandums:January 4, 1995.................3335Presidential Determinations:No. 95–11 of

December 30,1994 ...............................2671

No. 95–12 ofDecember 31,1994 ...............................2673

No. 95–13 ofDecember 31,1994 ...............................2675

5 CFR

211.....................................3055230.....................................3055300.....................................3055301.....................................3055307.....................................3055315.....................................3948316.....................................3055330.....................................3055333.....................................3055339.....................................3055340.....................................3055351...........................2677, 3055353.....................................3055532 ..................319, 5309, 5312550.....................................3303581.....................................5044630...........................3032, 5252831.....................................3337842.....................................3337870.....................................5461871.....................................5461872.....................................5461

873.....................................5461874.....................................5461890.....................................5461930.....................................3055Proposed Rules:300.....................................2546430.....................................5542432.....................................5542451.....................................5542531.....................................5542551.....................................2549

7 CFR

7.........................................198952.......................................353358.......................................4824201.....................................2493272.....................................1707273.....................................1707301...........................2321, 5087319...........................3067, 4529400.....................................1996402.....................................2000782.....................................5087925.....................................3725929...........................................1932.....................................4531966...........................................2967.....................................2873989.....................................45321005.....................................3191032.....................................3201434.....................................3211421...................................17091425...................................26801427...................................17091710...................................37261712...................................37261714...................................37261717...................................37261719...................................37261755 ..............1710, 1711, 50961773...................................28741785...................................37261944...................................4069Proposed Rules:53.......................................398254.......................................398275.........................................379210...........................5514, 5527220...........................5514, 5527273.....................................2703274.....................................2703335.....................................5289400.....................................3106457.....................................5339723.....................................48711007.......................................651032.......................................651040...................................45711050.....................................3791093.......................................65

ii Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Reader Aids

1094.......................................651096.......................................651099.......................................651108.......................................651280.....................................3801405...................................45711413...................................45711421.....................................3811494...................................35641755.........................1758, 17591948...................................35661951...................................3566

8 CFRProposed Rules:286.....................................3107

9 CFR

78.............................2875, 437191.............................4534, 483192.............................4372, 512797.......................................2875112.....................................2876317.......................................174381.......................................174Proposed Rules:1.........................................43833.........................................4383381.....................................3454

10 CFR

Ch. I ...................................407132...............................322, 3735Proposed Rules:20.......................................487235.......................................487250.......................................357952.......................................4877430.....................................4348440.....................................4480

11 CFR

1.........................................4072Proposed Rules:110.....................................41149003.........................3700, 41149004.........................3700, 41149006.........................3700, 41149007.........................3700, 41149033.........................3700, 41149034.........................3700, 41149037.........................3700, 41149038.........................3700, 4114

12 CFR

219.......................................231230.....................................5128261a...................................3340607.......................................325612.......................................325614.............................325, 2683615.......................................325618.....................................2683620.......................................325630.....................................2493Proposed Rules:230.....................................5142614.....................................2552615.....................................2552618.....................................2552

13 CFR

108.....................................4073122.....................................4373Proposed Rules:121.....................................4389

122.....................................4574

14 CFR

1.........................................507411.......................................507425.........................................32539...3, 327, 329, 330, 332, 336,

1712, 2323, 2493, 2495,2877, 3737, 3739, 4074,

407671 .........338, 2496, 3534, 3535,

3536, 3537, 3741, 4078,4079, 4946

73.............................3742, 374395.......................................437397.............................2009, 4080121 ......2497, 2687, 3303, 5074129.....................................2497135.....................................2497Proposed Rules:35.............................4114, 411639 .........66, 382, 384, 386, 388,

389, 393, 2033, 2036, 2041,2555, 2909, 3358, 3579,3581, 3583, 3585, 3587,3588, 3590, 3592, 4117,

411961.........................................39567.........................................39571 .........396, 2043, 2044, 2045,

2047, 3108, 3109, 3593,3595, 3596, 3777, 4131

73.......................................204891.......................................2557257.....................................3359258...........................3596, 3778

15 CFR

291.....................................4081

16 CFR

Proposed Rules:1700.........................2716, 4536

17 CFR

200...........................................5240.....................................5461249.....................................3078Proposed Rules:249.....................................4040404.....................................4576405.....................................4576

18 CFR

2.................................339, 483134.......................................483135.......................................483141.......................................4831131.....................................4831141.....................................1716154...........................2011, 3111157.....................................2011158.....................................3141201.....................................3141250.....................................3141260.....................................3141270.....................................2011271.....................................2011272.....................................2011273.....................................2011274.....................................2011275.....................................2011284...........................1716, 3141292.....................................4831294.....................................4831347.......................................356

348.......................................358375.....................................1716382.....................................4831385...........................1716, 48311312...................................5256Proposed Rules:284.....................................3783

19 CFR

101.....................................5312206...........................................6207.........................................18Proposed Rules:210.....................................3785

20 CFR

416.......................................360655...........................3950, 4028Proposed Rules:404.....................................3787422.....................................3787617.....................................3472

21 CFR

5.........................................201474.......................................5131201.....................................5131211.....................................4087310.....................................5313520.............................362, 3079522.............................362, 4375558.....................................3079900.....................................3451Proposed Rules:Ch. I ...................................515220.......................................5530310.....................................4132600.....................................2351601.....................................2351606.....................................2351607.....................................2351610.....................................2351640.....................................2351660.....................................2351892.....................................3168

22 CFR

226.....................................3743Proposed Rules:213.....................................2911

23 CFR

655.......................................363

24 CFR

91.............................1878, 486192.......................................1878261.....................................5280570...........................1878, 1922574.....................................1878576.....................................1878597...........................2880, 3034791.....................................3344813.....................................2658885.....................................2658907.....................................4344968.....................................1878970.....................................37063500...................................2642Proposed Rules:Ch. IX...................................303203.....................................4391

25 CFR

Proposed Rules:151.....................................1956

26 CFR

1 ..............23, 2049, 2497, 3345301.........................................33602.....................................2497Proposed Rules:1 ...397, 406, 2049, 2352, 2557,

271753...........................................82301.........................................83

27 CFR

Proposed Rules:4.................................411, 31715.................................411, 31717.................................411, 317124.......................................3598

28 CFR

2.........................................546116...........................................3836.............................3080, 5461540.......................................240545.......................................240Proposed Rules:90.............................3303, 439393.......................................5152

29 CFR

506.....................................3950507.....................................4028825...........................2180, 22821425...................................25091926...................................51312610...................................30802619...................................30822622...................................30802644...................................30842676...................................3082Proposed Rules:1910...................................41321915...................................41321926.........................4132, 4134

30 CFR

218.....................................3085773.....................................4662918.....................................4542936.....................................2512944.....................................2520Proposed Rules:56.......................................186657.......................................1866254.....................................3177773.....................................4393934.....................................3790935.....................................3184944.....................................4581

31 CFR

103...............................220, 234209.......................................416306.....................................4376344.....................................4502357.....................................4376

32 CFR

23.......................................454443a.....................................1720229.....................................5256323.....................................3087112.....................................1720113.....................................1720536.....................................1735537.....................................1735706.....................................3345

iiiFederal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Reader Aids

989.....................................4545Proposed Rules:169a.....................................417

33 CFR

117...........................4377, 4560161.....................................4377165.....................................4380241.....................................5133Proposed Rules:110.....................................2364117 .....2562, 2687, 3791, 3793,

5343156 ................1958, 3185, 5461334...........................4134, 4582

34 CFR

74.........................................36580.........................................36599.......................................3464645.....................................4748Proposed Rules:200.........................................85201...............................85, 2816203.........................................85212.........................................85

36 CFR

296.....................................5256Proposed Rules:7.........................................439468.......................................3599800.........................................86

37 CFR

Proposed Rules:1.........................................37003.........................................370010.......................................4395201...........................2365, 3948

38 CFR

21.......................................45613.........................................2522

40 CFR

9.........................................494835...............................366, 288051.............................1735, 471252...38, 40, 41, 372, 375, 1738,

2014, 2016, 2018, 2022,2025, 2026, 2066, 2067,2367, 2523, 2524, 2688,2690, 2881, 2885, 3346,3352, 3538, 3544, 3760,4562, 4712, 5134, 5136

60.......................................236963.............................4948, 532070 ........1741, 2527, 3766, 456380.............................2693, 269681 ...........41, 2026, 2885, 3349,

3352, 377182 ..................3303, 3318, 401085.......................................4712131.....................................4664180 .......378, 3546, 4091, 4093,

4095, 4097, 4861, 4862186.....................................4097192.....................................2854228.....................................2699260.....................................3089

261.....................................1744268.......................................242271 ......2534, 2699, 3095, 4380300.....................................4568799 ................4514, 4516, 5138Proposed Rules:Ch. I .....................................4182.........................................487751.......................................534452 ...........86, 87, 88, 418, 2066,

2067, 2563, 2565, 2568,2717, 2718, 2912, 3361,3602, 3794, 5155, 5344,

534555.......................................360357.......................................487760.......................................534461.......................................534464.......................................534470 ........2569, 2570, 2917, 458381 ......................88, 2719, 336682.......................................399285.......................................487786.......................................487791.......................................4878122.....................................4877123.....................................4877145.....................................4877152.....................................3796156.....................................2848170 ......2820, 2826, 2830, 2842174.....................................3796180 .........89, 2921, 3611, 3796,

3797, 5155185.....................................3607228.....................................3186230.......................................419233.....................................4877260.....................................4877270.....................................4877271.....................................4877281 ..................419, 4586, 4877300.............................422, 3189350.....................................4877403.....................................4877437.....................................5464704.....................................4877707.....................................4877710.....................................4877712.....................................4877716.....................................4877717.....................................4877720.....................................4877723.....................................4877750.....................................4877790.....................................4877

41 CFR

60–250...............................1986101–37...............................3547114.....................................3554201–3.................................2029201–9.................................2029201–18...............................2029201–20...............................2029201–21...............................2029201–23...............................2029201–39...............................2029Ch. 301 ..............................4477302–11...............................2536

42 CFR

400.....................................2325

405.....................................2325410...............................46, 2325414.........................................46484.....................................2325485.....................................2325486.....................................2325498.....................................2325Proposed Rules:51.......................................494663a.....................................4742

43 CFR

7.........................................5256Public Land Orders:7108...................................20307109...................................25397110...................................30987111...................................33567112...................................35557113...................................5321Proposed Rules:39.......................................4135

44 CFR

65.......................................409967.......................................4105Proposed Rules:67.......................................4135

45 CFR

1607...................................2330Proposed Rules:1604...................................33671611...................................3798

46 CFR

10.......................................452212.......................................452216.......................................452225.......................................2482160.....................................2482501.....................................5322Proposed Rules:515.....................................2923550.....................................2923580.....................................2923581.....................................2923

47 CFR

0.........................................53221.........................................532215.......................................330322.......................................355524.......................................533325.......................................532243.......................................532261.............................4107, 456964.......................................532269.......................................410773.............................3557, 532276.............................3099, 486390.......................................3773Proposed Rules:Ch. I ...................................38071.........................................27222.........................................272221.............................2722, 292461.......................................206869.......................................206873 .....90, 91, 2726, 3191, 3613,

5157, 5158, 5159

74.......................................292480.......................................272694.......................................2722101.....................................2722

48 CFR

206.....................................2888210.....................................4878215.....................................4878231...........................1747, 2330235.....................................4569237.....................................2888242.....................................1747252.....................................4878Proposed Rules:Ch. 1..............2302, 2472, 349231.......................................331432.......................................398833.......................................263039.......................................263042.......................................263045.......................................237050.......................................263052.............................2370, 2630219.....................................4144231.....................................2924252.....................................4144912.....................................4397923.....................................2727952.....................................4397970...........................2727, 43975452...................................41446101...................................3948

49 CFR

1.........................................2889382.....................................2030391.........................................54555.....................................1749571 .....1750, 2539, 2892, 3774,

5336572.....................................28961002.........................2543, 44771011...................................25431130...................................2543Proposed Rules:40.......................................3371171.....................................4879172.....................................4879173.....................................4879174.....................................4879175.....................................4879176.....................................4879177.....................................4879178.....................................4879179.....................................4879180.....................................4879214.....................................1761229.....................................3375231.....................................3375232.....................................3375390.........................................91391.........................................91392.........................................91396.........................................91544.....................................3830571...........................3303, 5345Ch. X..................................20691023...................................4397

iv Federal Register / Vol. 60, No. 18 / Friday, January 27, 1995 / Reader Aids

50 CFR

17 ............56, 2899, 3557, 526420.................................61, 217732.............................5066, 5276222...........................3775, 3948227.....................................3948611.....................................2331625...........................1757, 2905630.....................................2032642.....................................4866646.....................................3562651.....................................3102658.....................................5461663.....................................2331672 ................2905, 5337, 5338675 ................2905, 4110, 4866677...........................2344, 4866Proposed Rules:17 ...69, 425, 2070, 2638, 3613,

515918...........................................7023...........................................73222.....................................3032227.....................................2070301.....................................2925Ch. VI.................................3832611...........................4477, 4662655.....................................5162672.....................................4477675.....................................4662676 ................2935, 4477, 4662678.....................................2071

Friday January 27, 1995 - GovInfo

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