Unknown. Interim rule

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--- schema: federal-register doc_type: fedreg source_file: FR-2003-10-16.xml --- 68 200 Thursday, October 16, 2003 Contents Agency Agency for Healthcare Research and Quality NOTICES Agency information collection activities; proposals, submissions, and approvals, 59616-59618 03-26126 Agricultural Agricultural Marketing Service RULES Potatoes (Irish) grown in— Idaho and Oregon, 59524-59527 03-26177 PROPOSED RULES Milk marketing orders: Northeast, et al., 59554-59555 03-26178 Agriculture Agriculture Department See Agricultural Marketing Service See Animal and Plant Health Inspection Service See Commodity Credit Corporation See Food and Nutrition Service See Forest Service Alcohol Alcohol, Tobacco, Firearms, and Explosives Bureau NOTICES Agency information collection activities; proposals, submissions, and approvals, 59637 03-26261 Animal Animal and Plant Health Inspection Service RULES Exportation and importation of animals and animal products:

Classical swine fever; disease status change— East Anglia, 59527-59531 03-26042 PROPOSED RULES Plant-related quarantine, domestic: Plum pox compensation, 59548-59554 03-26174 Arts Arts and Humanities, National Foundation See National Foundation on the Arts and the Humanities Coast Guard Coast Guard RULES Drawbridge operations: Virginia, 59535-59538 03-26131 Ports and waterways safety: Chesapeake Bay— Cove Point, MD; Liquified Natural Gas Terminal; safety and security zone, 59538-59540 03-26128 NOTICES Meetings:

National Boating Safety Advisory Council, 59627 03-26130 Preparedness for Response Exercise Program: Triennial exercise schedule (2004—2006 FY), 59627-59630 03-26129 Commerce Commerce Department See Industry and Security Bureau See International Trade Administration See National Oceanic and Atmospheric Administration See National Telecommunications and Information Administration NOTICES Agency information collection activities; proposals, submissions, and approvals, 59580 03-26202 Senior Executive Service:

Performance Review Board; membership, 59580-59581 03-26086 CITA Committee for the Implementation of Textile Agreements NOTICES Cotton, wool, and man-made textiles: Philippines, 59592 03-26213 Commodity Commodity Credit Corporation NOTICES Domestic Sugar Program: 2002-crop sugar marketing allotments and allocations; revisions, 59578-59580 03-26175 Customs Customs and Border Protection Bureau NOTICES IRS interest rates used in calculating interest on overdue accounts and refunds, 59630-59631 03-26109 Education Education Department NOTICES Agency information collection activities; proposals, submissions, and approvals, 59592-59594 03-26141 03-26142 Grants and cooperative agreements; availability, etc.:

National Institute on Disability and Rehabilitation Research— Research Fellowships Program, 59594-59595 03-26208 Energy Energy Department See Federal Energy Regulatory Commission NOTICES Meetings: Environmental Management Advisory Board, 59595-59596 03-26168 Environmental Management Site-Specific Advisory Board— National Coal Council Advisory Committees, 59596 03-26169 Rocky Flats, CO, 59596-59597 03-26170 Natural gas exportation and importation: Husky Gas Marketing et al., 59597-59598 03-26171 EPA Environmental Protection Agency RULES Hazardous waste program authorizations:

West Virginia, 59542-59546 03-26047 PROPOSED RULES Disadvantaged Business Enterprise Program; participation by businesses in procurement under financial assistance agreements, 59563 03-26190 Hazardous waste program authorizations: West Virginia, 59563-59564 03-26048 NOTICES Environmental statements; availability, etc.: Coastal nonpoint pollution control program— Minnesota and Texas, 59588 03-26087 Grants and cooperative agreements; availability, etc.: National Brownfields Assessment, Revolving Loan Fund, and Cleanup Grants, 59611-59613 03-26192 Pesticide registration, cancellation, etc.:

Interregional Research Project (No. 4), 59613-59615 03-26195 Executive Executive Office of the President See Presidential Documents Export Export-Import Bank NOTICES Meetings: Renewable Energy Exports Advisory Committee, 59615 03-26179 FAA Federal Aviation Administration RULES Airworthiness directives: McDonnell Douglas, 59532-59535 03-25869 Pratt & Whitney Canada, 59531-59532 03-25865 PROPOSED RULES Airworthiness directives: Hartzell Propeller Inc., 59555-59557 03-26118 NOTICES Environmental statements; availability, etc.:

Launch and reentry operations; licensing, 59676 03-26090 FBI Federal Bureau of Investigation NOTICES Agency information collection activities; proposals, submissions, and approvals, 03-26262 59638-59639 03-26263 Federal Election Federal Election Commission NOTICES Meetings; Sunshine Act, 59615 03-26280 Federal Energy Federal Energy Regulatory Commission NOTICES Environmental statements; notice of intent: Discovery Gas Transmission, LLC, 59604-59605 E3-00065 Williston Basin Interstate Pipeline Co., 59606-59607 E3-00051 Hydroelectric applications, 59607-59610 E3-00047 E3-00048 E3-00049 E3-00050 Preliminary permits surrender:

Symbiotics, LLC, et al., 59610-59611 E3-00046 *Applications, hearings, determinations, etc.:* Enbridge Pipelines (KPC), 59598 E3-00064 Florida Gas Transmission Co., 59598-59599 E3-00060 Garden Banks Gas Pipeline, LLC, 59599 E3-00057 Guardian Pipeline, L.L.C., 59599 E3-00059 Iroquois Gas Transmission System, L.P., 59599-59600 E3-00052 Kern River Gas Transmission Co., 59600 E3-00056 MidAmerican Energy Co., 59600 E3-00044 National Fuel Gas Supply Corp., 59600-59601 E3-00063 Natural Gas Pipeline Co. of America, 59601 E3-00061 NRG Energy, Inc., 59601 E3-00045 Panhandle Eastern Pipe Line Co., LCC, 59602 E3-00043 Southwest Gas Storage Co., 59602 E3-00058 Tennessee Gas Pipeline Co., 59602-59603 E3-00062 Viking Gas Transmission Co., 59603 E3-00053 E3-00054 Williston Basin Interstate Pipeline Co., 59603-59604 E3-00055 FMC Federal Maritime Commission NOTICES Agreements filed, etc., 59615-59616 03-26218 Federal Motor Federal Motor Carrier Safety Administration NOTICES Motor carrier safety standards:

Exemption applications— Isuzu Motors America, Inc., 59677-59678 03-26119 Fish Fish and Wildlife Service NOTICES Agency information collection activities; proposals, submissions, and approvals, 59634-59635 03-26120 Environmental statements; availability, etc.: Recovery plans— Hawaiian forest birds, 59635-59636 03-26112 Food Food and Nutrition Service RULES Food Stamp Program: Non-discretionary quality control provisions, 59519-59524 03-26176 Forest Forest Service NOTICES Meetings:

Resource Advisory Committees— Lincoln County, 59580 03-26110 Siskiyou County, 59580 03-26111 Health Health and Human Services Department See Agency for Healthcare Research and Quality See Health Resources and Services Administration See National Institutes of Health NOTICES Meetings: Vital and Health Statistics National Committee, 59616 03-26143 Organization, functions, and authority delegations: Administrator, Health Resources and Services Administration, 59616 03-26144 Health Health Resources and Services Administration NOTICES Agency information collection activities; proposals, submissions, and approvals, 59618-59619 03-26187 Homeland Homeland Security Department See Coast Guard See Customs and Border Protection Bureau RULES Support Anti-Terrorism by Fostering Effective Technologies Act of 2002 (SAFETY Act); implementation, 59683-59704 03-26217 Housing Housing and Urban Development Department NOTICES Agency information collection activities; proposals, submissions, and approvals, 59631-59634 03-26088 Industry Industry and Security Bureau NOTICES Meetings:

President's Export Council, 59581 03-26125 Strategic and critical materials: National defense stockpile disposals; potential market impact, 59581-59583 03-26106 Interior Interior Department See Fish and Wildlife Service See Land Management Bureau IRS Internal Revenue Service PROPOSED RULES Procedure and administration: Information reporting penalties waiver; prompt correction determination Hearing cancellation, 59557 03-26216 International International Trade Administration NOTICES Antidumping:

Brake Rotors from— China, 59583 03-26210 Heavy forged hand tools, forged or unfinished, with or without handles, from— China, 59583-59584 03-26212 Industrial Nitrocellulose from— United Kingdom, 59584-59585 03-26209 Preserved mushrooms from— China, 59586 03-26211 Justice Justice Department See Alcohol, Tobacco, Firearms, and Explosives Bureau See Federal Bureau of Investigation See Justice Programs Office Justice Justice Programs Office NOTICES Agency information collection activities; proposals, submissions, and approvals, 59639-59640 03-26264 03-26265 Land Land Management Bureau NOTICES Meetings:

Resource Advisory Councils— New Mexico, 59636 03-26113 Survey plat filings: New Mexico, 59637 03-26182 National Foundation National Foundation on the Arts and the Humanities NOTICES Agency information collection activities; proposals, submissions, and approvals, 59640-59642 03-26180 03-26181 National Highway National Highway Traffic Safety Administration NOTICES Agency information collection activities; proposals, submissions, and approvals, 59678-59680 03-26091 03-26092 NIH National Institutes of Health NOTICES Meetings:

National Cancer Institute, 59619 03-26155 03-26167 National Center for Research Resources, 59619-59620 03-26156 National Heart, Lung, and Blood Institute, 59620 03-26145 National Institute of Allergy and Infectious Diseases, 03-26157 59622-59623 03-26158 National Institute of Child Health and Human Development, 03-26147 03-26148 59620-59625 03-26149 03-26150 03-26166 National Institute of Mental Health, 03-26154 59622-59624 03-26163 03-26164 03-26165 National Institute on Alcohol Abuse and Alcoholism, 59621 03-26151 National Institute on Deafness and Other Communication Disorders, 59623 03-26162 Scientific Review Center, 59625-59626 03-26159 03-26161 Warrren Grant Magnuson Clinical Center Board of Directors, 59627 03-26146 NOAA National Oceanic and Atmospheric Administration RULES Fishery conservation and management:

Alaska; fisheries of Exclusive Economic Zone— Pacific cod, 59546-59547 03-26193 Atlantic highly migratory species— Atlantic bluefin tuna, 59546 03-26201 PROPOSED RULES Fishery conservation and management: Alaska; fisheries of Exclusive Economic Zone— Gulf of Alaska groundfish, 59564-59577 03-26074 NOTICES Agency information collection activities; proposals, submissions, and approvals, 03-26203 59587-59588 03-26204 Environmental statements; availability, etc.: Coastal nonpoint pollution control program— Minnesota and Texas, 59588 03-26087 Meetings:

New England Fishery Management Council, 59588-59589 03-26198 03-26199 Pacific Fishery Management Council, 59589-59590 03-26197 South Atlantic Fishery Management Council, 59590-59591 03-26200 Permits: Endangered and threatened species, 59591 03-26196 National Science National Science Foundation NOTICES Committees; establishment, renewal, termination, etc.: Earthscope Science and Education Advisory Committee, 59642 03-26094 Meetings: Education and Human Resources Advisory Committee, 59642 03-26096 Geosciences Advisory Committee, 59642 03-26095 National Telecommunications National Telecommunications and Information Administration NOTICES Senior Executive Service:

Performance Review Board; membership, 59592 03-26124 Nuclear Nuclear Regulatory Commission NOTICES Meetings: Nuclear Waste Advisory Committee, 59643-59644 03-26135 Reactor Safeguards Advisory Committee, 59644-59645 03-26136 Regulatory guides; issuance, availability, and withdrawal, 59645 03-26138 Special nuclear material licensing requirements; exemptions: Envirocare of Utah, Inc., 59645-59647 03-26137 *Applications, hearings, determinations, etc.:* Dominion Nuclear North Anna, LLC, 59642-59643 03-26139 Overseas Overseas Private Investment Corporation NOTICES Meetings;

Sunshine Act, 59647 03-26278 Personnel Personnel Management Office NOTICES Agency information collection activities; proposals, submissions, and approvals, 59647 03-26215 Presidential Presidential Documents PROCLAMATIONS *Special observances:* Columbus Day (Proc. 7720), 59515-59516 03-26330 General Pulaski Memorial Day (Proc. 7721), 59517-59518 03-26331 National School Lunch Week (Proc. 7719), 59513-59514 03-26329 SEC Securities and Exchange Commission NOTICES Agency information collection activities; proposals, submissions, and approvals, 59647-59648 03-26097 Meetings;

Sunshine Act, 59649-59650 03-26344 Self-regulatory organizations; proposed rule changes: American Stock Exchange LLC, 59650-59656 03-26103 Chicago Board Options Exchange, Inc., 59656-59659 03-26206 03-26207 National Association of Securities Dealers, Inc., 59659-59661 03-26099 Pacific Exchange, Inc., 59661-59666 03-26100 03-26102 Philadelphia Stock Exchange, Inc., 59666-59673 03-26101 *Applications, hearings, determinations, etc.:* JF International Management Inc., et al., 59648-59649 03-26098 Social Social Security Administration NOTICES Meetings:

Ticket to Work and Work Incentives Advisory Panel, 59673 03-26140 State State Department NOTICES Art objects; importation for exhibition: Verrocchio's David Restored: A Renaissance Bronze from the National Museum of Bargello, Florence, 59673-59674 03-26186 Grants and cooperative agreements; availability, etc.: Non-Arab and Muslim World; human rights and democratization initiatives, 59674-59675 03-26185 Surface Surface Transportation Board NOTICES Motor carriers: Finance transactions— Niagara Frontier Tariff Bureau, Inc., 59680 03-26132 Railroad operation, acquisition, construction, etc.:

CSX Transportation, Inc., 59680-59682 03-26038 Textile Textile Agreements Implementation Committee See Committee for the Implementation of Textile Agreements Transportation Transportation Department See Federal Aviation Administration See Federal Motor Carrier Safety Administration See National Highway Traffic Safety Administration See Surface Transportation Board NOTICES Agency information collection activities; proposals, submissions, and approvals, 59675-59676 03-26127 Treasury Treasury Department See Internal Revenue Service Veterans Veterans Affairs Department RULES Adjudication; pensions, compensation, dependency, etc.:

Chronic lymphocytic leukemia; presumptive service connection, 59540-59542 03-26252 PROPOSED RULES Medical benefits: Extended care services; computing copayments, 59557-59563 03-26184 NOTICES Disciplinary Appeals Board Panel; employee roster availability, 59682 03-26253 Separate Parts In This Issue Part II Homeland Security Department, 59683-59704 03-26217 Reader Aids Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws.

To subscribe to the Federal Register Table of Contents LISTSERV electronic mailing list, go to http://listserv.access.gpo.gov and select Online mailing list archives, FEDREGTOC-L, Join or leave the list (or change settings); then follow the instructions. 68 200 Thursday, October 16, 2003 Rules and Regulations DEPARTMENT OF AGRICULTURE Food and Nutrition Service 7 CFR Parts 272 and 275 RIN 0584-AD31 Food Stamp Program: Non-Discretionary Quality Control Provisions of Title IV of Public Law 107-171 AGENCY:

Food and Nutrition Service, USDA. ACTION: Interim rule. SUMMARY: On May 13, 2002, the President signed the Farm Security and Rural Investment Act of 2002 (the 2002 Act). Title IV of the 2002 Act (the Food Stamp Reauthorization Act of 2002) contains provisions concerning the Food Stamp Program. This rule amends the Food Stamp Program regulations to implement certain provisions concerning the Quality Control system in sections 4118 and 4119 of the Food Stamp Reauthorization Act of 2002.

This interim rule revises the current regulations to reflect the new liability procedures and the new deadlines for completing the Quality Control review process and announcement of error rates. As a result of the change in the statute, a new two-year liability system will be instituted which will result in fewer State agencies being subject to liabilities for excessive payment error rates. There will be new time frames for State agencies to complete the quality control case review process and for the Department to issue error rates.

DATES: This interim rule is effective December 15, 2003. Comments on this rulemaking must be received on or before January 14, 2004 to be assured of consideration. ADDRESSES: Comments should be submitted to Daniel Wilusz, Quality Control Branch, Program Accountability Division, Food and Nutrition Service, USDA, 3101 Park Center Drive, Alexandria, Virginia, 22302. Comments may also be faxed to the attention of Daniel Wilusz at

(703)305-0928 or e-mailed to *Daniel.wilusz@fns.usda.gov.* All written comments will be open for public inspection at the office of the Food and Nutrition Service during regular business hours (8:30 a.m. through 5 p.m.). You may also download an electronic version of this rule at *http://www.fns.usda.gov/fsp/rules/Regulations/default.htm.* FOR FURTHER INFORMATION CONTACT: Questions regarding this rulemaking should be addressed to Margaret Werts Batko at the above address or by telephone at

(703)305-2516. SUPPLEMENTARY INFORMATION: Executive Order 12866 This rule has been determined to be Significant and was reviewed by the Office of Management and Budget under Executive Order 12866. Executive Order 12372 The Food Stamp Program is listed in the Catalog of Federal Domestic Assistance under No. 10.551. For the reasons set forth in the final rule in 7 CFR part 3015, subpart V and related Notice (48 FR 29115, June 24, 1983), this Program is excluded from the scope of Executive Order 12372 which requires intergovernmental consultation with State and local officials. Regulatory Flexibility Act This rule has been reviewed with regard to the requirements of the Regulatory Flexibility Act of 1980 (5 U.S.C. 601-612). Eric M. Bost, Under Secretary for Food, Nutrition, and Consumer Services, has certified that this rule will not have a significant economic impact on a substantial number of small entities. State and local welfare agencies will be the most affected to the extent that they administer the Program. Public Law 104-4 Unfunded Mandate Reform Act of 1995 (UMRA). Title II of UMRA establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, the Food and Nutrition Service

(FNS)generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, or tribal governments in the aggregate, or to the private sector, of $100 million or more in any one year. When such a statement is needed for a rule, section 205 of the UMRA generally requires FNS to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, more cost-effective or least burdensome alternative that achieves the objectives of the rule. This rule contains no Federal mandates (under the regulatory provisions of Title II of the UMRA) for State, local, and tribal governments or the private sector of $100 million or more in any one year. This rule is, therefore, not subject to the requirements of sections 202 and 205 of the UMRA. Federalism Summary Impact Statement Executive Order 13132 requires Federal agencies to consider the impact of their regulatory actions on State and local governments. Where such actions have federalism implications, agencies are directed to provide a statement for inclusion in the preamble to the regulations describing the agency's considerations in terms of the three categories called for under section (6)(b)(2)(B) of Executive Order 13132. FNS has considered this rule's impact on State and local agencies and has determined that it does not have Federalism implications under E.O. 13132. This rule does not impose substantial or direct compliance costs on State and local governments. Therefore, under section 6(b) of the Executive Order, a Federalism summary impact statement is not required. Civil Rights Impact Analysis FNS has reviewed this interim rule in accordance with the Department Regulation 4300-4, “Civil Rights Impact Analysis,” to identify and address any major civil rights impacts the rule might have on minorities, women, and persons with disabilities. After a careful review of the rule's intent and provisions, FNS has determined that this rule has no impact on any of the protected classes. These changes affect the quality control review system and not individual recipients' eligibility for or participation in the Food Stamp Program. FNS has no discretion in implementing these changes. The changes are required to be implemented by law. All data available to FNS indicate that protected individuals have the same opportunity to participate in the Food Stamp Program as non-protected individuals. FNS specifically prohibits the State and local government agencies that administer the Program from engaging in actions that discriminate based on race, color, national origin, gender, age, disability, marital or family status. Regulations at 7 CFR 272.6 specifically state that “State agencies shall not discriminate against any applicant or participant in any aspect of program administration, including, but not limited to, the certification of households, the issuance of coupons, the conduct of fair hearings, or the conduct of any other program service for reasons of age, race, color, sex, handicap, religious creed, national origin, or political beliefs. Discrimination in any aspect of program administration is prohibited by these regulations, the Food Stamp Act of 1977 (the Act), the Age Discrimination Act of 1975 (Pub. L. 94-135), the Rehabilitation Act of 1973 (Pub. L. 93-112, section 504), and title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d). Enforcement action may be brought under any applicable Federal law. Title VI complaints shall be processed in accord with 7 CFR Part 15.” Paperwork Reduction Act This interim rule does not contain changes to the reporting or recordkeeping requirements subject to approval by the Office of Management and Budget

(OMB)under the Paperwork Reduction Act of 1995 (44 U.S.C. 3507). Reporting and recordkeeping requirements for quality control are approved under OMB numbers 0584-0074, 0584-0299, 0584-0303, and 0584-0034. There are no changes being made in this rulemaking that will alter the reporting and recordkeeping requirements related to quality control approved under these burdens. The legislative change concerning corrective action planning does not affect the burden in 0584-0010 for reporting and recordkeeping because the change only affects which States would be required to submit corrective action plans and because the number of states required to submit corrective action plans will not change under the new requirement. The burden approved under OMB number 0584-0010 was allowed to expire. The Food and Nutrition Service has initiated action to reinstate the burden under 0584-0010. Government Paperwork Elimination Act In compliance with the Government Paperwork Elimination Act, FNS is committed to providing electronic submission as an alternative for information collections associated with this rule. However, we are not able to make the entire process electronic at this time. Part of the process allows electronic submission. The Quality Control review schedule (approved under OMB #0584-0299) serves as both the data summary entry form that the reviewer completes during each review, and subsequently, as the data input document for direct data entry into the Kansas City Computer Center (KCCC). While the data is manually collected on a paper form from information extracted from a case file, it is electronically submitted to the KCCC for tabulation and analysis. Some States have begun to use computerized versions of the worksheet (OMB number 0584-0074), which provides information collected on the review schedule. In addition, the FNS contractor for the data collection system has developed, at FNS request, a computerized version of the worksheet. States are being given the option to continue to use their own systems, the new computerized version provided by FNS or the paper version. When FNS computerized versions of the worksheet are used, the information is linked to and creates the review schedule. Under OMB number 0584-0034, the burden for collecting and reporting information related to the review of negative cases and the status of sample selection and completion is approved. The FNS-245 serves as both the data summary entry form that the reviewer completes during each negative case review, and subsequently as the data input document for direct data entry into the KCCC. Therefore, while data is manually collected, it is electronically submitted to the KCCC for tabulation and analysis. The FNS-248 (Status of Sample Selection and Completion) collects information on the status of State reviews. The FNS-248 contains information not produced by the automated system, therefore this report is still necessary. However, we are considering ways that this data could be collected electronically. The burden under OMB number 0584-0303 encompasses the sampling plan, arbitration, and good cause. At this time, these areas are not substantively electronic submittals. To the extent possible, States may submit documents or portions of documents electronically. States have the option to maintain in paper or electronic format information compiled for the Performance Reporting System, including Management Evaluation, Data Analysis and Corrective Action information. The State maintains the information on site to be available for FNS review (OMB number 0584-0010). Executive Order 12988 This rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule is intended to have preemptive effect with respect to any State or local laws, regulations, or policies that conflict with its provisions or that would otherwise impede its full implementation. This rule is not intended to have retroactive effect unless so specified in the “Effective Date” paragraph of the final rule. Prior to any judicial challenge to the provisions of this rule or the application of its provisions, all applicable administrative procedures must be exhausted. In the Food Stamp Program the administrative procedures are as follows:

(1)For Program benefit recipients—State administrative procedures issued pursuant to 7 U.S.C. 2020(e)(1) and 7 CFR 273.15;

(2)for State agencies—administrative procedures issued pursuant to 7 U.S.C. 2023 set out at 7 CFR 276.7 (for rules related to non-quality control

(QC)liabilities) or Part 283 (for rules related to QC liabilities);

(3)for retailers and wholesalers—administrative procedures issued pursuant to 7 U.S.C. 2023 set out at 7 CFR 278.8 and part 279. Regulatory Impact Analysis *Need for Action:* This rule amends the Food Stamp Program regulations to implement certain provisions concerning the Quality Control system in sections 4118 and 4119 of the Food Stamp Reauthorization Act of 2002. These provisions revise the liability procedures and establish new deadlines for completing the Quality Control review process and announcement of payment error rates. The rule has no Federal Program cost impacts, however, fewer States will be identified as having any potential liability, and any such liabilities will be significantly lower than under the existing system. *Justification of alternatives.* The Department has no discretion regarding the legislative mandate to revise the liability and enhanced funding provisions of the QC system. Nor does it have discretion regarding the provision that revises time frames for completing the review and arbitration process and announcing individual State agency payment error rates at the end of each annual review period. The Department does have discretion in resolving the liabilities established under the new system. The Secretary may: Waive all or a portion of the liability; require the State agency to reinvest up to 50 percent of the liability in activities to improve program administration, which new investment money shall not be matched by Federal funds; designate up to 50 percent of the liability as at-risk for repayment if a liability is established based on the State agency's payment error rate for the subsequent fiscal year; or assert any combination of these options. Once the Secretary issues the original resolution proposal, only the amounts designated as waived or reinvestment are subject to negotiation between the State agency and the Department. *Effects on Food Stamp Recipients.* This action is not anticipated to have any impact on benefit levels or food stamp program participation, as it does not change the program's eligibility requirements or benefit calculation. *Effects on Federal Program Costs.* Since this action is not anticipated to have any impact on benefit levels or food stamp participation, we do not anticipate any impact on food stamp benefit costs. There is also no anticipated financial impact in administration costs from the changes in how liabilities are calculated, assessed, or collected. *Effects on Administering State Agencies:* This rule affects State agencies by revising the QC sanction system. Under this rule, fewer States will be identified as having any potential liability, and any such liabilities will be significantly lower than under the existing sanction system. State agencies will also have additional time to complete the quality control review process. *Effect on Retailers.* This action is not anticipated to have any impact on food stamp retailers. Justification for Interim Rulemaking This action is being finalized without prior notice or public comment under authority of 5 U.S.C. 553(b)(3)(A) and (B). The provisions contained in this rule are mandated by sections 4118 and 4119 of the Food Stamp Reauthorization Act of 2002. The Department has no discretion in implementing the specific provisions contained in this rule. These provisions are effective for the Fiscal Year 2003 review period beginning October 1, 2002. The provisions included in this rule are mandated by legislation, and the Department has no discretion in the methodology establishing the national performance measure, or in determining when State agencies develop corrective action plans resulting from payment error rates. Thus, the Department has determined in accordance with 5 U.S.C. 553(b) that a notice of proposed rulemaking and an opportunity for prior public comments is unnecessary. Discretionary regulatory changes that result from sections 4118 and 4119 will be addressed subsequently in one or more proposed rulemakings. Background On May 13, 2002, the President signed Public Law 107-171, the Farm Security and Rural Investment Act of 2002. Title IV of Public Law 107-171, the Food Stamp Reauthorization Act of 2002, significantly revised the liability and enhanced funding provisions of the Quality Control

(QC)system. In this interim rule, we are addressing the provisions in section 4118 of the Food Stamp Reauthorization Act of 2002 concerning establishment, adjustment, and collection of potential liabilities and the requirement to develop a corrective action plan when a State's payment error rate exceeds six percent. In this interim rule, we are also addressing the provision in Section 4119 that revises time frames for completing the review and arbitration process and announcing individual State agency error rates at the end of each annual review period. All remaining provisions not addressed in this rule will be addressed in one or more subsequent proposed rulemakings. Establishing Liabilities for Excessive Payment Error Rates Section 4118 of the Food Stamp Reauthorization Act of 2002 amended Section 16(c) of the Food Stamp Act of 1977, as amended, significantly revising the system for determining liabilities for payment error rates. Under the Food Stamp Act, as amended, prior to enactment of the Food Stamp Reauthorization Act of 2002, liability was determined each fiscal year. As defined in 7 CFR 275.23(e) of the program regulations, the payment error tolerance level was the national performance measure for the fiscal year. The national performance measure is defined as the sum of the products of each State agency's payment error rate times that State agency's proportion of the total value of national allotments issued for the fiscal year using the most recent issuance data available at the time the State agency is notified of its payment error rate. A State agency that exceeded this tolerance level was subject to a liability claim equivalent to the total value of the allotments issued in the fiscal year by the State agency, multiplied by a factor that is the lesser of:

(1)The ratio of the amount by which the payment error rate of the State agency for the fiscal year exceeds the national performance measure for the fiscal year, to the national performance measure for the fiscal year, or

(2)one. This figure was then multiplied by the amount by which the payment error rate of the State agency for the fiscal year exceeded the national performance measure for the fiscal year. Section 4118 of the Food Stamp Reauthorization Act of 2002 establishes a new multi-year liability system. The national performance measure continues to be defined as the sum of the products of each State agency's payment error rate times that State agency's proportion of the total value of national allotments issued for the fiscal year using the most recent issuance data available at the time the State agency is notified of its payment error rate. However, the method for determining any potential liability has changed. Under this system, Fiscal Year 2003 serves as the initial base year. For Fiscal Year 2004 and subsequent years, liability for payment shall be established whenever there is a 95 percent statistical probability that, for the second or subsequent consecutive fiscal year, a State agency's payment error rate exceeds 105 percent of the national performance measure. For example, if there were a 95 percent statistical probability that a State agency's payment error rate for Fiscal Year 2003 exceeded 105 percent of the Fiscal Year 2003 national performance measure, and again in Fiscal Year 2004, if there was a 95 percent statistical probability that the State's payment error rate exceeded 105 percent of the Fiscal Year 2004 national performance measure, a liability for Fiscal Year 2004 would be established. The amount of the liability shall be equal to the product of: The value of all allotments issued by the State agency in the (second or subsequent consecutive) fiscal year; multiplied by the difference between the State agency's payment error rate and 6 percent; multiplied by 10 percent. In order to implement this change, we are revising 7 CFR 275.23(e). First, we are deleting subsections (e)(2), (e)(3), and (e)(4) because they address liability determinations for prior fiscal years that have already been resolved. Second, we are redesignating paragraph (e)(5) as paragraph (e)(2) and amending that subsection by deleting the words “and beyond” and replacing them with the words “through Fiscal Year 2002.” Finally, a new paragraph (e)(3) is being added that established the liability system for Fiscal Year 2004 and beyond. A conforming amendment is also being made redesignating paragraphs (e)(6), (e)(7), (e)(8), (e)(9), (e)(10), and (e)(11) as (e)(4), (e)(5), (e)(6), (e)(7), (e)(8), and (e)(9). Resolving Liabilities Prior to the passage of the Food Stamp Reauthorization Act of 2002, potential liabilities were established each year. The Secretary had unlimited authority to propose a resolution, including: waiving any or all of the amount; requiring that any or all of the amount be repaid to the Federal government; entering into an agreement to allow some or all of the liability amount to be reinvested in error reduction activities; or combining these options. Once issuing a proposed settlement plan to a State agency, the Secretary could negotiate with the State agency to revise any and all aspects of the proposed liability resolution. Section 4118 establishes new requirements for resolving State agency liabilities for payment errors. Under the Food Stamp Act, as amended by the Food Stamp Reauthorization Act of 2002, the Secretary has the authority to waive or reduce any liability. The Secretary may require a State agency to reinvest up to 50 percent of the established liability in activities designed to reduce the payment error rate. The Secretary may also designate up to 50 percent of the liability as being “at-risk.” A State agency would be required to pay to USDA any money designated as “at-risk” if a liability for payment errors is established for the State agency the following fiscal year. The Secretary may combine these three options. In accordance with the Food Stamp Reauthorization Act of 2002, the Department and any State agency found liable for an excessive payment error rate must settle any waiver amount or reinvestment amount before the end of the fiscal year in which the liability is determined. The amount designated as being at-risk in the proposed settlement plan sent to the State agency is not subject to negotiation, in accordance with the provision in the Food Stamp Reauthorization Act of 2002 which provides that the Department shall make its liability resolution determinations and enter into a settlement with the State agency *only with respect to any waiver amount or new investment amount* (emphasis added). When the Department notifies the State agency of its payment error rate and its potential liability, that letter will also designate the amount to be waived, and what amount is designated as at risk and/or subject to reinvestment. Because the Department is authorized to enter into a settlement with a State agency concerning the amount to be waived or reinvested, the Department may opt to enter into negotiations with the State agency to waive any or all of the amount designated for reinvestment. Current regulations specify the requirements for reinvestment. Any reinvestment plan established for the amount designated for reinvestment either in the initial letter or as a result of negotiations much meet the requirements in 7 CFR 275.23(e)(11). However, the law does not allow the Department to negotiate any amount designated as at-risk, once that amount has been designated. Therefore, the Department will not negotiate with the State agency on the amount designated as at-risk once the notification letter has been sent to the State agency. The amount designated as at-risk cannot be reconsidered for waiving or reinvestment in the following year if a liability for payment errors is established for the State agency in the following fiscal year. A new paragraph (e)(10) is being added to § 275.23 establishing the Secretary's authority to resolve the liabilities under these three options. Appeals In accordance with the Food Stamp Act, as amended, State agencies may appeal the amount of the liability established as described above. However, State agencies may not appeal the Secretary's decision as to how such liability will be resolved; *i.e.* , waived, at-risk, or reinvestment. Nor is the amount of the national performance measure subject to either administrative or judicial appeal, in accordance with section 4118 of the Food Stamp Reauthorization Act of 2002. The time frames and procedures for appealing were not changed by the Food Stamp Reauthorization Act of 2002 and the procedures in 7 CFR part 283 of the regulations remain in place. The Secretary is required to initiate collection for any amount owed by the State agency before the end of the fiscal year in which the liability is determined. However, the requirement to resolve all liabilities before the end of the fiscal year shall be suspended if an administrative appeal relating to the liability is pending. The provision suspending collection pending an administrative appeal existed in the Food Stamp Act prior to the passage of the Food Stamp Reauthorization Act of 2002 and was not changed by that Act. Current regulations address this suspension, and accordingly, no changes are being made to the regulations. Section 4118 provides that if a State agency appeals its liability determination, if the State agency began required reinvestment activities prior to an appeal determination, and if the liability amount is reduced to $0 through the appeal, the Secretary shall pay to the State agency an amount equal to 50 percent of the new investment amount that was included in the liability amount subject to the appeal. If the Secretary wholly prevails on a State agency's appeal, section 4118 provides that the Secretary will require the State agency to invest all or a portion of the amount designated for reinvestment during the appeal to be reinvested or to be repaid to the Federal government. Section 4118 further specifies that if neither party wholly prevails that the remaining liability will be treated pursuant to regulations issued by the Secretary. In this rule, we are incorporating into new § 275.23(e)(10) the provisions in section 4118 concerning either the Secretary or the State wholly prevailing. We will address in a proposed rule how any remaining liability will be handled if neither party wholly prevails on appeal. Time Frames for Announcing the National Performance Measure and for Completing Quality Control Reviews and Resolving State/Federal Differences Section 4119 of the Food Stamp Reauthorization Act of 2002 establishes new dates for resolution of the case review and arbitration process and for issuance of the national average payment error rate, the individual State final error rates, and the amounts of any payments claimed or liability amounts established. Under the Food Stamp Act prior to the Food Stamp Reauthorization Act of 2002, all case reviews and arbitration had to be completed not later than 180 days after the end of the fiscal year. FNS was required to announce the national average payment error rate, the individual State final error rates, and the amounts of any liabilities within 30 days following completion of the case reviews and arbitration. Under section 4119, all case reviews and arbitration are required to be completed by May 31 following the end of the fiscal year. The national average payment error rate, the individual State final error rates, and the amounts of any payments claimed or liability amounts established are required to be announced by June 30 following the end of the fiscal year. In accordance with section 4118, this rule also requires that FNS provide a copy of each State agency's notice of payment claimed or liability amount due to the State's chief executive officer and legislature. In this interim rulemaking, we are revising redesignated paragraph (e)(7) in § 275.23 to establish these new dates. Redesignated paragraph (e)(7) also requires FNS to provide the State chief executive officer and the legislature with a copy of the State's notice of payment claimed or liability amount. At this time we are not revising the time frames for processing individual cases or conducting individual arbitration cases. Implementing guidance was issued on January 22, 2003, providing interim direction to State agencies on completing cases reviews under these new time frames for Fiscal Year 2003. A proposed rule will be issued that addresses these issues. Corrective Action Planning Current regulations provide that corrective action planning shall be done by a State agency when it fails to reach the yearly target (§ 275.16(b)(1)), when the State agency is not entitled to enhanced funding (§ 275.16(b)(2)), or when the State agency's negative case error rate exceeds one percent (§ 275.16(b)(3)). Section 4118 of the Food Stamp Reauthorization Act of 2002 requires State agencies to do corrective action planning whenever its payment error rate is six percent or greater. Accordingly, we are revising § 275.16(b)(1) to require corrective action planning whenever a State agency's error rate equals or exceeds six percent. This change will have little real impact on State agencies because current regulations require corrective action planning whenever a State agency is not eligible for enhanced funding. One of the criteria for enhanced funding is that the payment error rate is below 5.90 percent. Therefore, all State agencies with error rates above 5.90 percent are already required to develop corrective action plans. In addition several technical changes throughout 7 CFR part 275 have been made to correct references to paragraphs changed in this rulemaking and to fix typographical errors. Implementation This rule is effective December 15, 2003. Section 4118 of the Food Stamp Reauthorization Act of 2002 was effective October 1, 2002, and section 4119 was effective upon enactment, May 13, 2002. This rule reflects these statutory provisions which impact the establishment of payment error rates, the national performance measure, and sanctions and liabilities for Fiscal Year 2003 and beyond. List of Subjects 7 CFR Part 272 Alaska, Civil rights, Claims, Food stamps, Grant programs, Social programs, Reporting and recordkeeping requirements, Unemployment compensation, Wages 7 CFR Part 275 Administrative practice and procedure, Food stamps, Reporting and recordkeeping requirements. Accordingly, 7 CFR parts 272 and 275 are amended as follows: 1. The authority citation for parts 272 and 275 continue to read as follows: Authority: 7 U.S.C. 2011-2036. PART 272—REQUIREMENTS FOR PARTICIPATING STATE AGENCIES 2. In § 272.1, add paragraph (g)(169) to read as follows: § 272.1 General terms and conditions.

(g)*Implementation.* * * *

(169)*Amendment No. 395.* The provisions of Amendment 395 are effective December 15, 2003. PART 275—PERFORMANCE REPORTING SYSTEM § 275.3 [Amended] 3. In § 275.3, the last sentence of paragraph

(c)is amended by removing the reference “§ 275.23(e)(8)” and adding in its place the reference “§ 275.23(e)(6)”. § 275.11 [Amended] 4. In § 275.11, the third sentence of paragraph § 275.11(g) is amended by removing the reference “§ 275.25(e)(8)” and adding in its place the reference “§ 275.23(e)(6)”. 5. In § 275.16, paragraph (b)(1) is revised to read as follows: § 275.16 Corrective action planning.

(b)* * *

(1)Result from a payment error rate of 6 percent or greater (actions to correct errors in individual cases, however, shall not be submitted as part of the State agency's corrective action plan); 6. In § 275.23: a. Paragraph (d)(1)(iii) is amended by removing the reference “(e)(8)(iii)” and adding in its place the reference “(e)(6)(iii)”. b. Paragraph (e)(1) is amended by removing the reference “(e)(8)” and adding in its place the reference “(e)(6)”. c. Paragraphs (e)(2), (e)(3), and (e)(4) are removed. d. Paragraph (e)(5) is redesignated as paragraph (e)(2) and is further amended by removing the words “and beyond” in the paragraph heading and adding in their place the words “through Fiscal Year 2002”. e. Newly redesignated paragraph (e)(2)(i) is amended by removing the words “and subsequent years” and adding in their place the words “through Fiscal Year 2002”; and further amended by removing the word “rates” in the second sentence and adding in its place the word “rate”. f. A new paragraph (e)(3) is added. g. Paragraphs (e)(6), (e)(7), (e)(8), (e)(9), (e)(10), and (e)(11) are redesignated as paragraphs (e)(4), (e)(5), (e)(6), (e)(7), (e)(8) and (e)(9), respectively. h. Newly redesignated paragraph (e)(5)(i)(B)( *3* ) is amended by removing the reference “(e)(7)(i)(A)” and adding in its place the reference “(e)(5)(i)(A)”. i. Newly redesignated paragraph (e)(5)(i)(C)( *3* )( *iii* ) is amended by removing the reference “(e)(5)(i)” wherever it appears and adding in its place the reference “(e)(2)(i)”. j. Newly redesignated paragraph (e)(5)(i)(E) is amended by removing the reference “(e)(7)(i)(A) through (e)(7)(i)(D)” and adding in its place the reference “(e)(5)(i)(A) through (e)(5)(i)(D)”. k. Newly redesignated paragraph (e)(5)(i)(E)(2) is amended by removing the reference “(e)(7)(i)(E)” and adding in its place the reference “(e)(5)(i)(E)”. l. Newly redesignated paragraph (e)(5)(ii) is amended by removing the reference “(e)(7)(i)(A) through (e)(7)(i)(E)” and adding in its place the reference “(e)(5)(i)(A) through (e)(5)(i)(E)”. m. Newly redesignated paragraph (e)(5)(iii) is amended by removing the reference “(e)(7)” and adding in its place the reference “(e)(5)”. n. Newly redesignated paragraph (e)(6)(i)(D) is amended by removing the reference “(e)(8)(iii)” and adding in its place the reference “(e)(6)(iii)”. o. Newly redesignated paragraphs (e)(6)(iii)(A) and (e)(6)(iii)(B) are amended by removing the reference “(e)(8)(i)(C)” wherever it appears and adding in its place the reference “(e)(6)(i)(C)”. p. Newly redesignated paragraph (e)(7) is amended by removing the first and second sentences and adding in their place four new sentences. q. Newly redesignated paragraph (e)(8) is amended by removing the reference “§ 275.23(e)(5)” and adding in its place the reference “paragraphs (e)(2) and (e)(3) of this section”. r. Newly redesignated paragraph (e)(9) is amended by removing the words “and subsequent” in the first sentence and adding in their place the words “through Fiscal Year 2002”. s. Newly redesignated paragraph (e)(9)(iii) is amended by removing the reference “(e)(11)(vi)” and adding in its place the reference “(e)(9)(vi)”. t. A new paragraph (e)(10) is added. The additions read as follows: § 275.23 Determination of State agency program performance.

(e)* * *

(3)*Establishment of payment error rates and liability.* For Fiscal Year 2003 and subsequent years, FNS shall announce a national performance measure not later than June 30 after the end of the fiscal year. The national performance measure is the sum of the products of each State agency's error rate times that State agency's proportion of the total value of national allotments issued for the fiscal year using the most recent issuance data available at the time the State agency is notified of its payment error rate. Once announced, the national performance measure for a given fiscal year will not be subject to change. The national performance measure announced under this paragraph (e)(3) is not subject to administrative or judicial review. Liability for payment shall be established for Fiscal Year 2004 and beyond whenever there is a 95 percent statistical probability that, for the second or subsequent consecutive fiscal year, a State agency's payment error rate exceeds 105 percent of the national performance measure. The amount of the liability shall be equal to the product of:

(i)The value of all allotments issued by the State agency in the (second or subsequent consecutive) fiscal year; multiplied by

(ii)the difference between the State agency's payment error rate and 6 percent; multiplied by

(iii)10 percent.

(7)* * * The case review process and the arbitration of all difference cases shall be completed by May 31 following the end of the fiscal year. FNS shall determine and announce the national average payment error rate for the fiscal year by June 30 following the end of the fiscal year. At the same time FNS shall notify all State agencies of their individual payment error rates and payment error rate liabilities, if any. FNS shall provide a copy of each State agency's notice to its respective chief executive officer and legislature. * * *

(10)*Resolution of liabilities for FY 2003 and beyond.* FNS may: waive all or a portion of the liability; require the State agency to reinvest up to 50 percent of the liability in activities to improve program administration, which new investment money shall not be matched by Federal funds; designate up to 50 percent of the liability as “at-risk” for repayment if a liability is established based on the State agency's payment error rate for the subsequent fiscal year; or assert any combination of these options. Once FNS establishes its proposed liability resolution plan, the amount assigned as at-risk is not subject to settlement negotiation between FNS and the State agency and may not be reduced unless an appeal decision revises the total dollar liability. FNS and the State shall settle any waiver amount or reinvestment amount before the end of the fiscal year in which the liability amount is determined unless an administrative appeal relating to the claim is pending. If a State agency appeals its liability determination, if the State agency began required reinvestment activities prior to an appeal determination, and if the liability amount is reduced to $0 through the appeal, FNS shall pay to the State agency an amount equal to 50 percent of the new investment amount that was included in the liability amount subject to the appeal. If FNS wholly prevails on a State agency's appeal, FNS will require the State agency to invest all or a portion of the amount designated for reinvestment during the appeal to be reinvested or to be repaid to the Federal government. Dated: October 3, 2003. Eric M. Bost, Under Secretary, Food, Nutrition, and Consumer Services. [FR Doc. 03-26176 Filed 10-15-03; 8:45 am]

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