Rules and Regulations. Final rule; correction

57,692 words·~262 min read·/register/2006/07/13/06-6166

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

BILLING CODE 6560-50-P FEDERAL COMMUNICATIONS COMMISSION 47 CFR Part 1 [WT Docket No. 05-211; DA 06-1280] Commercial Spectrum Enhancement Act and Modernization of the Commission's Competitive Bidding Rules and Procedures AGENCY: Federal Communications Commission. ACTION: Final rule; correction. SUMMARY: The Federal Communications Commission published in the **Federal Register** of May 4, 2006, a document that included new or modified information collections. This document corrects the ordering clause in paragraph 52. DATES: Effective June 16, 2006. FOR FURTHER INFORMATION CONTACT: Brian Carter, Auction and Spectrum Access Division, Wireless Telecommunications Bureau at

(202)418-0660. SUPPLEMENTARY INFORMATION: This is a summary of the *Erratum and Notice of Office of Management and Budget Approval of Information Collections* released on June 16, 2006. The complete text of the *Erratum and Notice of Office of Management and Budget Approval of Information Collections* and related Commission documents, is available for public inspection and copying from 8 a.m. to 4:30 p.m. Monday through Thursday or from 8 a.m. to 11:30 a.m. on Friday at the FCC Reference Information Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC 20554. The *Erratum and Notice of Office of Management and Budget Approval of Information Collections* and related Commission documents may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc. (BCPI), Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 202-488-5300, facsimile 202-488-5563, or you may contact BCPI at its Web site: *http://www.BCPIWEB.com.* On April 25, 2006, the Federal Communications Commission (Commission) released a *Second Report and Order and Second Further Notice of Proposed Rule Making (Designated Entity Second Report and Order)* , 71 FR 26245, May 4, 2006. The *Designated Entity Second Report and Order* included new or modified information collections. The *Erratum and Notice of Office of Management and Budget Approval of Information Collections* (Erratum) corrects paragraph 103 of the *Designated Entity Second Report and Order* , which appeared as paragraph 52 in the **Federal Register** of May 4, 2006. The Commission may conduct the information collections required by §§ 1.2105(a)(2)(ii)(B), 1.2110(b)(1)(i) and (ii), and 1.2112(b)(1)(iii) and (iv), as amended by the *Designated Entity Second Report and Order* consistent with the Paperwork Reduction Act of 1995. *See* Public Information Collection Approved by Office of Management and Budget, 71 FR 34935, June 16, 2006. In FR Doc. 06-4257 published on May 4, 2006, (71 FR 26245) make the following corrections. On page 26250, in the third column, paragraph 52 is corrected to read as follows: Accordingly, *it is ordered* , that, pursuant to sections 4(i), 303(r), and 309(j) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 303(r), and 309(j), the *Second Report and Order* is hereby *adopted* and Part 1 of the Commission's rules, 47 CFR Part 1, is *amended* as set forth in Appendix B, effective 30 days after publication in the **Federal Register** , except for the grandfathering provisions, which are effective upon release. The Commission will not conduct or sponsor any new or modified information collections required pursuant to Sections 1.913(a)(6); 1.913(b); 1.919(b)(5); 1.2105(a)(2)(ii)(B); 1.2110(b)(1)(i) and (ii); 1.2110(j) and (n); 1.2111(a), (b), and (c)(2) and (3); 1.2112(b)(1)(iii) and (iv), and (2)(iii),

(v)and (vii); and 1.2114(b), (f), and

(g)of the amended rules adopted herein until approval by the Office of Management and Budget

(OMB)has been obtained under the Paperwork Reduction Act of 1995, Pub. L. 104-13. The Commission will publish notice in the **Federal Register** announcing such OMB approval. Federal Communications Commission. Gary D. Michaels, Deputy Chief, Auctions and Spectrum Access Division, WTB. [FR Doc. E6-11050 Filed 7-12-06; 8:45 am] BILLING CODE 6712-01-P 71 134 Thursday, July 13, 2006 Proposed Rules DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2006-25336; Directorate Identifier 2006-NM-070-AD] RIN 2120-AA64 Airworthiness Directives; Boeing Model 737-300, -400, -500, -600, -700, -800 and -900 Series Airplanes; and Model 757-200 and -300 Series Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: The FAA proposes to adopt a new airworthiness directive

(AD)for certain Boeing Model 737-300, -400, -500, -600, -700, -800 and -900 series airplanes; and Model 757-200 and -300 series airplanes. This proposed AD would require modifying the activation mechanism in the chemical oxygen generator of each passenger service unit (PSU). This proposed AD results from several reports indicating that some chemical oxygen generators failed to activate during in-flight decompression events. These failures were due to fracture of components between the passenger oxygen mask and the release pin in the oxygen generator. We are proposing this AD to prevent failure of the activation mechanism of the chemical oxygen generator, which could result in the unavailability of supplemental oxygen and possible incapacitation of passengers and cabin crew during an in-flight decompression. DATES: We must receive comments on this proposed AD by August 28, 2006. ADDRESSES: Use one of the following addresses to submit comments on this proposed AD. • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Government-wide rulemaking Web site:* Go to *http://www.regulations.gov* and follow the instructions for sending your comments electronically. • *Mail:* Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, room PL-401, Washington, DC 20590. • *Fax:*

(202)493-2251. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. Contact Boeing Commercial Airplanes, P.O. Box 3707, Seattle, Washington 98124-2207, for the service information identified in this proposed AD. FOR FURTHER INFORMATION CONTACT: Susan Letcher, Aerospace Engineer, Cabin Safety and Environmental Systems Branch, ANM-150S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue, SW., Renton, Washington 98055-4056; telephone

(425)917-6474; fax

(425)917-6590. SUPPLEMENTARY INFORMATION: Comments Invited We invite you to submit any relevant written data, views, or arguments regarding this proposed AD. Send your comments to an address listed in the ADDRESSES section. Include the docket number “FAA-2006-25336; Directorate Identifier 2006-NM-070-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments. We will post all comments we receive, without change, to *http://dms.dot.gov* , including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed AD. Using the search function of that Web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477-78), or you may visit *http://dms.dot.gov* . Examining the Docket You may examine the AD docket on the Internet at *http://dms.dot.gov* , or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone

(800)647-5227) is located on the plaza level of the Nassif Building at the DOT street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after the Docket Management System receives them. Discussion We have received several reports indicating that some chemical oxygen generators failed to activate during in-flight decompression events. These failures were due to fracture of components between the passenger oxygen mask and the release pin in the oxygen generator. The release pin must be pulled out of the oxygen generator firing mechanism to activate the generator. The fractures occur when a passenger encounters resistance when attempting to pull down the oxygen mask. The system is designed so that when a mask is pulled down for donning, a lanyard attached to the mask pulls down on a release cable within the passenger service unit (PSU). The release cable is attached to a pin in the oxygen generator firing mechanism. Downward pressure applied on the release cable when the mask is pulled down causes the pin to be pulled out of the firing mechanism, activating the generator and starting the flow of oxygen to the masks. If excessive resistance occurs when pulling down the mask, the components between the mask and the generator release pin can break, such as the tab that connects the oxygen mask to the lanyard or the ring that attaches the lanyard to the release cable. Failure of the activation mechanism of the chemical oxygen generator could result in the unavailability of supplemental oxygen and possible incapacitation of passengers and cabin crew during an in-flight decompression. Relevant Service Information We have reviewed the service bulletins identified in the following table. The service bulletins describe procedures for modifying the activation mechanism in the chemical oxygen generator of each PSU. The modification includes replacing the oxygen generator release pin; reworking the center cable guides; replacing the pulley guards/covers, and adding a pulley configuration placard. Service Bulletins Boeing special attention service bulletin Applicable to model/series— 737-25-1545, dated September 8, 2005 737-600, -700, -800, and -900. 737-25-1548, dated November 22, 2005 737-300, -400, and -500. 757-25-0284, dated November 22, 2005 757-200. 757-25-0285, dated November 22, 2005 757-300. Accomplishing the actions specified in the service information is intended to adequately address the unsafe condition. FAA's Determination and Requirements of the Proposed AD We have evaluated all pertinent information and identified an unsafe condition that is likely to exist or develop on other airplanes of this same type design. For this reason, we are proposing this AD, which would require accomplishing the actions specified in the service information described previously. Costs of Compliance There are about 3,283 airplanes of the affected design in the worldwide fleet. This proposed AD would affect about 815 airplanes of U.S. registry. The proposed modification would take about 1 work hour per PSU, per airplane, at an average labor rate of $80 per work hour. Required parts would cost between $68 and $75 per PSU, per airplane. Based on these figures, the estimated cost of the modification proposed by this AD for U.S. operators is between $148 and $155 per PSU, per airplane. Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in subtitle VII, part A, subpart III, section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. For the reasons discussed above, I certify that the proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. See the ADDRESSES section for a location to examine the regulatory evaluation. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The Federal Aviation Administration

(FAA)amends § 39.13 by adding the following new airworthiness directive (AD): **Boeing:** Docket No. FAA-2006-25336; Directorate Identifier 2006-NM-070-AD. Comments Due Date

(a)The FAA must receive comments on this AD action by August 28, 2006. Affected ADs

(b)None. Applicability

(c)This AD applies to Boeing Model 737-300, -400, -500, -600, -700, -800 and -900 series airplanes; and Model 757-200 and -300 series airplanes; certificated in any category; as identified in the applicable service bulletin in Table 1 of this AD. Table 1.—Service Bulletins Boeing special attention service bulletin Date Applicable to model/series 737-25-1545 September 8, 2005 737-600, -700, -800, and -900. 737-25-1548 November 22, 2005 737-300, -400, and -500. 757-25-0284 November 22, 2005 757-200. 757-25-0285 November 22, 2005 757-300. Unsafe Condition

(d)This AD results from several reports indicating that some chemical oxygen generators failed to activate during in-flight decompression events. These failures were due to fracture of components between the passenger oxygen mask and the release pin in the oxygen generator. We are issuing this AD to prevent failure of the activation mechanism of the chemical oxygen generator, which could result in the unavailability of supplemental oxygen and possible incapacitation of passengers and cabin crew during an in-flight decompression. Compliance

(e)You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done. Modification

(f)Within 60 months after the effective date of this AD: Modify the activation mechanism in the chemical oxygen generator of each passenger service unit

(PSU)by doing all the applicable actions specified in the Accomplishment Instructions of the applicable service bulletin in Table 1 of this AD. Alternative Methods of Compliance (AMOCs) (g)(1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested in accordance with the procedures found in 14 CFR 39.19.

(2)Before using any AMOC approved in accordance with § 39.19 on any airplane to which the AMOC applies, notify the appropriate principal inspector in the FAA Flight Standards Certificate Holding District Office. Issued in Renton, Washington, on July 6, 2006. Ali Bahrami, Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. E6-11021 Filed 7-12-06; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2006-25337; Directorate Identifier 2006-NM-138-AD] RIN 2120-AA64 Airworthiness Directives; BAE Systems (Operations) Limited Model BAe 146 Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: The FAA proposes to adopt a new airworthiness directive

(AD)for all BAE Systems (Operations) Limited Model BAe 146 airplanes. This proposed AD would require inspecting the three-phase circuit breakers and three-phase circuit breaker panels for discrepancies; and fixing any discrepancy and replacing unserviceable units with new units, if necessary. This proposed AD results from reports of three-phase circuit breakers overheating on in-service airplanes. We are proposing this AD to prevent failure of a three-phase circuit breaker. Such failure could prevent an electrical load from being isolated from its electrical supply, which could result in smoke or fire in the flight deck. DATES: We must receive comments on this proposed AD by August 14, 2006. ADDRESSES: Use one of the following addresses to submit comments on this proposed AD. • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Government-wide rulemaking Web site:* Go to *http://www.regulations.gov* and follow the instructions for sending your comments electronically. • *Mail:* Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, room PL-401, Washington, DC 20590. • *Fax:*

(202)493-2251. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. Contact British Aerospace Regional Aircraft American Support, 13850 Mclearen Road, Herndon, Virginia 20171, for service information identified in this proposed AD. FOR FURTHER INFORMATION CONTACT: Todd Thompson, Aerospace Engineer, International Branch, ANM-116, FAA, Transport Airplane Directorate, 1601 Lind Avenue, SW., Renton, Washington 98055-4056; telephone

(425)227-1175; fax

(425)227-1149. SUPPLEMENTARY INFORMATION: Comments Invited We invite you to submit any relevant written data, views, or arguments regarding this proposed AD. Send your comments to an address listed in the ADDRESSES section. Include the docket number “FAA-2006-25337; Directorate Identifier 2006-NM-138-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments. We will post all comments we receive, without change, to *http://dms.dot.gov* , including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed AD. Using the search function of that Web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You may review the DOT's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477-78), or you may visit *http://dms.dot.gov.* Examining the Docket You may examine the AD docket on the Internet at *http://dms.dot.gov* , or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone

(800)647-5227) is located on the plaza level of the Nassif Building at the DOT street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after the Docket Management System receives them. Discussion The European Aviation Safety Agency (EASA), which is the airworthiness authority for the European Union, notified us that an unsafe condition may exist on all BAE Systems (Operations) Limited Model BAe 146 airplanes. The EASA advises that three-phase circuit breakers, which are used at various locations throughout the airplane (but predominantly in the under floor electrical bay and the flight deck) have overheated on in-service airplanes. The possible cause of the overheating is the age-related deterioration of the three-phase circuit breakers. Failure of a three-phase circuit breaker, if not corrected, could prevent an electrical load from being isolated from its electrical supply, which could result in smoke or fire in the flight deck. Relevant Service Information BAE Systems (Operations) Limited has issued Inspection Service Bulletin ISB.24-141, dated August 15, 2005. The inspection service bulletin describes procedures for performing a detailed visual inspection of the three-phase circuit breakers and three-phase circuit breaker panels for discrepancies (such as physical damage, cracks, deterioration, corrosion, discoloration, contamination by foreign objects, and missing or improperly installed terminal connections or attachments), fixing any discrepancy and replacing unserviceable units with new units, if necessary. Accomplishing the actions specified in the service information is intended to adequately address the unsafe condition. The EASA mandated the service information and issued airworthiness directive 2006-0132, dated May 18, 2006, to ensure the continued airworthiness of these airplanes in the European Union. FAA's Determination and Requirements of the Proposed AD This airplane model is manufactured in the United Kingdom and is type certificated for operation in the United States under the provisions of section 21.29 of the Federal Aviation Regulations (14 CFR 21.29) and the applicable bilateral airworthiness agreement. As described in FAA Order 8100.14A, “Interim Procedures for Working with the European Community on Airworthiness Certification and Continued Airworthiness,” dated August 12, 2005, the EASA has kept the FAA informed of the situation described above. We have examined the EASA's findings, evaluated all pertinent information, and determined that we need to issue an AD for airplanes of this type design that are certificated for operation in the United States. Clarification of Inspection Terminology In this proposed AD, the “detailed visual inspection” specified in the BAE Systems (Operations) Limited inspection service bulletin is referred to as a “detailed inspection.” We have included the definition for a detailed inspection in a note in the proposed AD. Costs of Compliance This proposed AD would affect about 368 airplanes of U.S. registry. The proposed inspection would take about 5 work hours per airplane, at an average labor rate of $80 per work hour. Based on these figures, the estimated cost of the proposed AD for U.S. operators is $147,200, or $400 per airplane. Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in subtitle VII, part A, subpart III, section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. For the reasons discussed above, I certify that the proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. See the ADDRESSES section for a location to examine the regulatory evaluation. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The Federal Aviation Administration

(FAA)amends § 39.13 by adding the following new airworthiness directive (AD): **BAE Systems (Operations) Limited (Formerly British Aerospace Regional Aircraft):** Docket No. FAA-2006-25337; Directorate Identifier 2006-NM-138-AD. Comments Due Date

(a)The FAA must receive comments on this AD action by August 14, 2006. Affected ADs

(b)None. Applicability

(c)This AD applies to all BAE Systems (Operations) Limited Model BAe 146-100A, -200A, and -300A series airplanes, certificated in any category. Unsafe Condition

(d)This AD results from reports of three-phase circuit breakers overheating on in-service airplanes. We are issuing this AD to prevent failure of a three-phase circuit breaker. Such failure could prevent an electrical load from being isolated from its electrical supply, which could result in smoke or fire in the flight deck. Compliance

(e)You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done. Detailed Inspection and Corrective Actions

(f)Within 12 months after the effective date of this AD, do a detailed inspection of the three-phase circuit breakers and three-phase circuit breaker panels for discrepancies (including but not limited to physical damage, cracks, deterioration, corrosion, discoloration, contamination by foreign objects, and missing or improperly installed terminal connections or attachments), in accordance with the Accomplishment Instructions of BAE Systems (Operations) Limited Inspection Service Bulletin ISB.24-141, dated August 15, 2005. If any discrepancy is found, before further flight, fix the discrepancy and replace unserviceable units with new units, as applicable, in accordance with the inspection service bulletin. Note 1: For the purposes of this AD, a detailed inspection is: “An intensive examination of a specific item, installation, or assembly to detect damage, failure, or irregularity. Available lighting is normally supplemented with a direct source of good lighting at an intensity deemed appropriate. Inspection aids such as mirror, magnifying lenses, etc., may be necessary. Surface cleaning and elaborate procedures may be required.” No Reporting

(g)Although the inspection service bulletin referenced in this AD specifies to submit certain information to the manufacturer, this AD does not include that requirement. Alternative Methods of Compliance (AMOCs) (h)(1) The Manager, International Branch, ANM-116, Transport Airplane Directorate, FAA, has the authority to approve AMOCs for this AD, if requested in accordance with the procedures found in 14 CFR 39.19.

(i)The European Aviation Safety Agency airworthiness directive 2006-0132, dated May 18, 2006, also addresses the subject of this AD. Issued in Renton, Washington, on July 6, 2006. Ali Bahrami, Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. E6-11022 Filed 7-12-06; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2006-25326; Directorate Identifier 2006-NM-081-AD] RIN 2120-AA64 Airworthiness Directives; Boeing Model 757-200 and -300 Series Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: The FAA proposes to adopt a new airworthiness directive

(AD)for certain Boeing Model 757-200 and -300 series airplanes. This proposed AD would require changes to existing wiring; installation of new circuit breakers, relays, relay connectors, and wiring; and replacement of certain circuit breakers with higher-rated circuit breakers. For certain airplanes, this proposed AD also requires modification of wiring of the control module assembly for the electrical systems. This proposed AD results from an in-flight entertainment

(IFE)systems review. We are proposing this AD to ensure that the flightcrew is able to turn off electrical power to the IFE system through utility bus switches in the flight compartment. The flightcrew's inability to turn off power to the IFE system during a non-normal or emergency situation could result in the inability to control smoke or fumes in the airplane flight deck or cabin. DATES: We must receive comments on this proposed AD by August 28, 2006. ADDRESSES: Use one of the following addresses to submit comments on this proposed AD. • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Government-wide rulemaking Web site:* Go to *http://www.regulations.gov* and follow the instructions for sending your comments electronically. • *Mail:* Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC 20590. • *Fax:*

(202)493-2251. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. Contact Boeing Commercial Airplanes, P.O. Box 3707, Seattle, Washington 98124-2207, for the service information identified in this proposed AD. FOR FURTHER INFORMATION CONTACT: Natalie Phan-Tran, Aerospace Engineer, Systems and Equipment Branch, ANM-130L, FAA, Los Angeles Aircraft Certification Office, 3960 Paramount Boulevard, Lakewood, California 90712-4137; telephone

(562)627-5343; fax

(562)627-5210. SUPPLEMENTARY INFORMATION: Comments Invited We invite you to submit any relevant written data, views, or arguments regarding this proposed AD. Send your comments to an address listed in the ADDRESSES section. Include the docket number “FAA-2006-25326; Directorate Identifier 2006-NM-081-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments. We will post all comments we receive, without change, to *http://dms.dot.gov* , including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed AD. Using the search function of that Web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477-78), or you may visit *http://dms.dot.gov.* Examining the Docket You may examine the AD docket on the Internet at *http://dms.dot.gov* , or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone

(FAA)completed a review of in-flight entertainment

(IFE)systems certified by supplemental type certificate

(STC)and installed on transport category airplanes. The review focused on the interface between the IFE system and airplane electrical system, with the objective of determining if any unsafe conditions exist with regard to the interface. STCs issued between 1992 and 2000 were considered for the review. The type of IFE systems considered for review were those that contain video monitors (cathode ray tubes or liquid crystal displays; either hanging above the aisle or mounted on individual seat backs or seat trays), or complex circuitry (i.e., power supplies, electronic distribution boxes, extensive wire routing, relatively high power consumption, multiple layers of circuit protection, etc.). In addition, in-seat power supply systems that provide power to more than 20 percent of the total passenger seats were also considered for the review. The types of IFE systems not considered for review include systems that provide only audio signals to each passenger seat, ordinary in-flight telephone systems (e.g., one telephone handset per group of seats or bulkhead-mounted telephones), systems that have only a video monitor on the forward bulkhead(s) (or a projection system) to provide passengers with basic airplane and flight information, and in-seat power supply systems that provide power to less than 20 percent of the total passenger seats. Items considered during the review include the following: • Can the electrical bus(es) supplying power to the IFE system be de-energized when necessary without removing power from systems that may be required for continued safe flight and landing? • Can IFE system power be removed when required without pulling IFE system circuit breakers ( *i.e.* , is there a switch (dedicated to the IFE system or a combination of loads) located in the flight deck or cabin that can be used to remove IFE power?)? • If the IFE system requires changes to flightcrew procedures, has the airplane flight manual

(AFM)been properly amended? • If the IFE system requires changes to cabin crew procedures, have they been properly amended? • Does the IFE system require periodic or special maintenance? In all, we reviewed approximately 180 IFE systems approved by STC. The review results indicate that potential unsafe conditions exist on some IFE systems installed on various transport category airplanes. These conditions can be summarized as: • Electrical bus(es) supplying power to the IFE system cannot be de-energized when necessary without removing power from systems that may be required for continued safe flight and landing. • Power cannot be removed from the IFE system when required without pulling IFE system circuit breakers (i.e., there is no switch dedicated to the IFE system or combination of systems for the purpose of removing power). • Installation of the IFE system has affected crew (flightcrew and/or cabin crew) procedures, but the procedures have not been properly revised. The IFE system on the Model 757-200 and -300 series airplanes is connected to an electrical bus that cannot be deactivated without also removing power from airplane systems necessary for safe flight and landing. There is no other means to remove power from the IFE system. This condition, if not corrected, could result in the flightcrew's inability to turn off electrical power to the IFE system through utility bus switches in the flight compartment during a non-normal or emergency situation, and consequent inability to control smoke or fumes in the airplane flight deck or cabin. Other Relevant Rulemaking We have issued numerous ADs previously that address unsafe conditions and require corrective actions similar to those that would be required by the proposed AD. Those ADs and the applicable airplanes and STC number are identified in the following table. Airplanes STC No. AD reference Airbus Model A340-211 airplanes ST09092AC-D AD 2001-18-01, amendment 39-12427 (66 FR 46939, September 10, 2001). Boeing Model 737-200 series airplanes ST00516AT AD 2004-05-27, amendment 39-13522 (69 FR 12063, March 15, 2004). Boeing Model 737-300 series airplanes ST00171SE AD 2001-14-10, amendment 39-12321 (66 FR 36455, July 12, 2001). Boeing Model 737-700 series airplanes ST09100AC-D, ST09104AC-D, ST09105AC-D, ST09106AC-D AD 2001-14-12, amendment 39-12323 (66 FR 36452, July 12, 2001). Boeing Model 737-600, -700, -800 series airplanes and Model 757-200 and -300 series airplanes Not applicable AD 2003-26-12, amendment 39-13411 (69 FR 861, January 7, 2004). Boeing Model 747-100 and -200 series airplanes SA8622SW AD 2001-14-11, amendment 39-12322 (66 FR 36453, July 12, 2001). Boeing Model 747-100 and -200 series airplanes ST00196SE AD 2001-16-19, amendment 39-12388 (66 FR 43068, August 17, 2001). Boeing Model 747-400 series airplanes SA8843SW AD 2001-14-15, amendment 39-12326 (66 FR 36447, July 12, 2001). Boeing Model 747SP series airplanes ST09097AC-D AD 2001-14-14, amendment 39-12325 (66 FR 36449, July 12, 2001). Boeing Model 757-200 series airplanes SA1727GL AD 2001-14-01, amendment 39-12311 (66 FR 36149, July 11, 2001). Boeing Model 767-200 series airplanes SA4998NM AD 2001-16-21, amendment 39-12390 (66 FR 43072, August 17, 2001). Boeing Model 767-200 series airplanes SA5134NM AD 2001-16-20, amendment 39-12389 (66 FR 43066, August 17, 2001). Boeing Model 767-200 series airplanes ST09022AC-D AD 2001-14-13, amendment 39-12324 (66 FR 36450, July 12, 2001). Boeing Model 767-300 series airplanes SA5765NM, SA5978NM AD 2001-16-17, amendment 39-12386 (66 FR 42937, August 16, 2001). Boeing Model 767-300 series airplanes SA7019NM-D AD 2001-18-08, amendment 39-12434 (66 FR 46517, September 6, 2001). Boeing Model 767-300 series airplanes ST00118SE AD 2001-14-04, amendment 39-12314 (66 FR 36699, July 13, 2001). Boeing Model 767-300 series airplanes ST00157SE AD 2001-16-18, amendment 39-12387 (66 FR 43070, August 17, 2001). Boeing Model 767-300 series airplanes ST01869AT-D AD 2002-26-14, amendment 39-13002 (68 FR 1525, January 13, 2003). Boeing Model 767-300 series airplanes ST01783AT-D AD 2003-07-15, amendment 39-13111 (68 FR 18535, April 16, 2003). Boeing Model 767-200 and -300 series airplanes Not applicable AD 2003-14-10, amendment 39-13229 (68 FR 42583, July 18, 2003; corrected at 68 FR 44385, July 28, 2003). McDonnell Douglas Model DC-9-51 and DC-9-83 airplanes SA8026NM AD 2001-14-02, amendment 39-12312 (66 FR 36456, July 12, 2001). McDonnell Douglas Model DC-10-30 airplanes SA8452SW AD 2001-16-22, amendment 39-12391 (66 FR 43074, August 17, 2001). McDonnell Douglas Model DC-10-30 airplanes ST00054SE AD 2001-14-03, amendment 39-12313 (66 FR 36150, July 11, 2001) (Inadvertently referenced by the Federal Register as AD 2001-13-03, in the Agency Docket Number heading, on page 36150, in the third column). McDonnell Douglas Model MD-11 airplanes ST00236LA-D (Santa Barbara Aerospace) AD 99-20-08, amendment 39-11338 (64 FR 52221, September 28, 1999). Relevant Service Information We have reviewed Boeing Service Bulletin 757-24-0093, dated August 14, 2003 (for Model 757-200 series airplanes); and Boeing Service Bulletin 757-24-0094, dated April 17, 2003 (for Model 757-300 series airplanes). The service bulletins describe the following procedures: • For all airplanes, changing the wiring at the P5 and P11 panel assemblies in the flight compartment, at the P36 panel assembly in the forward cargo compartment, and at the P37 and P70 panel assemblies in the main electronics compartment. • For all airplanes, installing a new relay at the P36 panel assembly in the forward cargo compartment and at the P37 panel assembly in the main electronics compartment. • For certain Model 757-200 series airplanes, installing new circuit breakers C3090 and C3089 at the P37 and P70 panel assemblies, respectively, in the main electronics compartment. • For certain Model 757-200 series airplanes and certain Model 757-300 series airplanes, replacing circuit breakers C311 and C315 at the P31 and P32 panel assemblies, respectively, in the main electronics compartment with higher-rated circuit breakers. • For all Model 757-300 series airplanes, installing a relay connector at the P37 panel assembly and at the P36 panel assembly. • For certain Model 757-300 series airplanes, installing new wires between the P5 panel assembly in the flight compartment and the P36 and P37 panel assemblies in the main electronics compartment. Accomplishing the actions specified in the service information is intended to adequately address the unsafe condition. Concurrent Service Information For certain Model 757-200 series airplanes, Boeing Service Bulletin 757-24-0093 also recommends concurrent accomplishment of Boeing Component Service Bulletin 233N3209-24-04, Revision 1, dated August 14, 2003. Boeing Component Service Bulletin 233N3209-24-04 describes procedures for modifying the wiring of the control module assembly for the electrical systems. The modification includes installing new wiring and changing the existing wiring of the control module assembly. FAA's Determination and Requirements of the Proposed AD We have evaluated all pertinent information and identified an unsafe condition that is likely to exist or develop on other airplanes of this same type design. For this reason, we are proposing this AD, which would require accomplishing the actions specified in the service information described previously. Costs of Compliance There are about 548 airplanes of the affected design in the worldwide fleet. This proposed AD would affect about 332 Model 757-200 and 7-300 airplanes of U.S. registry. The following table provides the estimated costs, at an average labor rate of $80 per hour, for U.S. operators to comply with this proposed AD. The estimated work hours and cost of parts in the following table depend on the relay and wiring configuration of an airplane. Estimated Costs Model Action Work hours Parts Cost per airplane Number of U.S.-registered airplanes Fleet cost 757-200 series airplanes Installation 38-46 $2,781-$5,917 $5,821-$9,597 318 $1,851,078-$3,051,846 Concurrent modification 3 73-90 313-330 318 99,534-104,940 757-300 series airplanes Installation 22 2,080-4,632 3,840-6,392 14 53,760-89,488 Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in subtitle VII, part A, subpart III, section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. For the reasons discussed above, I certify that the proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. See the ADDRESSES section for a location to examine the regulatory evaluation. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The Federal Aviation Administration

(FAA)amends § 39.13 by adding the following new airworthiness directive (AD): **Boeing:** Docket No. FAA-2006-25326; Directorate Identifier 2006-NM-081-AD. Comments Due Date

(a)The FAA must receive comments on this AD action by August 28, 2006. Affected ADs

(b)None. Applicability

(c)This AD applies to the Boeing airplanes identified in paragraphs (c)(1) and (c)(2) of this AD, certificated in any category.

(1)Model 757-200 series airplanes, as identified in Boeing Service Bulletin 757-24-0093, dated August 14, 2003.

(2)Model 757-300 series airplanes, as identified in Boeing Service Bulletin 757-24-0094, dated April 17, 2003. Unsafe Condition

(d)This AD results from an in-flight entertainment

(IFE)systems review. We are issuing this AD to ensure that the flightcrew is able to turn off electrical power to the IFE system through utility bus switches in the flight compartment. The flightcrew's inability to turn off power to the IFE system during a non-normal or emergency situation could result in the inability to control smoke or fumes in the airplane flight deck or cabin. Compliance

(e)You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done. Installation of Circuit Breakers, Relays, and Wiring

(f)Within 60 months after the effective date of this AD, do the applicable actions specified in paragraphs (f)(1) through (f)(6) of this AD, in accordance with the Accomplishment Instructions of Boeing Service Bulletin 757-24-0093, dated August 14, 2003 (for Model 757-200 series airplanes); or Boeing Service Bulletin 757-24-0094, dated April 17, 2003 (Model 757-300 series airplanes), as applicable.

(1)For all airplanes: Change the wiring at the P5 and P11 panel assemblies in the flight compartment, at the P36 panel assembly in the forward cargo compartment, and at the P37 and P70 panel assemblies in the main electronics compartment. Install a new relay and relay connector, if applicable, at the P36 panel assembly and at the P37 panel assembly.

(2)For Model 757-200 series airplanes identified as Group 1 in Boeing Service Bulletin 757-24-0093, dated August 14, 2003: Install new circuit breakers C3090 and C3089 at the P37 and P70 panel assemblies, respectively, in the main electronics compartment.

(3)For Model 757-200 series airplanes identified as Groups 21 and 22 in Boeing Service Bulletin 757-24-0093, dated August 14, 2003: Replace circuit breaker C311 at the P31 panel assembly in the main electronics compartment with a higher-rated circuit breaker.

(4)For Model 757-200 series airplanes identified as Groups 1 through 20 inclusive and 23 through 40 inclusive in Boeing Service Bulletin 757-24-0093, dated August 14, 2003: Replace circuit breakers C311 and C315 at the P31 and P32 panel assemblies, respectively, in the main electronics compartment with higher-rated circuit breakers.

(5)For Model 757-300 series airplanes identified as Groups 1 and 4 in Boeing Service Bulletin 757-24-0094, dated April 17, 2003: Replace circuit breakers C311 and C315 at the P31 and P32 panel assemblies, respectively, in the main electronics compartment with higher-rated circuit breakers.

(6)For Model 757-300 series airplanes identified as Groups 1, 2, and 3 in Boeing Service Bulletin 757-24-0094, dated April 17, 2003: Install new wires between the P5 panel assembly in the flight compartment and the P36 and P37 panel assemblies in the main electronics compartment. Concurrent Requirement for Certain Airplanes

(g)For the Model 757-200 series airplanes identified as Groups 8, 9, 12, 15, 20, 21 through 32 inclusive, and 34 through 40 inclusive in Boeing Service Bulletin 757-24-0093, dated August 14, 2003: Prior to or concurrently with accomplishing the actions specified in paragraph

(f)of this AD, modify the wiring of the control module assembly for the electrical systems, by accomplishing all of the actions specified in the Accomplishment Instructions of Boeing Component Service Bulletin 233N3209-24-04, Revision 1, dated August 14, 2003, as applicable. Credit for Accomplishment of Previous Service Bulletin

(h)Modification of the control module assembly done before the effective date of this AD in accordance with Boeing Component Service Bulletin 233N3209-24-04, dated April 10, 2003, is acceptable for compliance with the requirements of paragraph

(g)of this AD. Alternative Methods of Compliance (AMOCs) (i)(1) The Manager, Seattle Aircraft Certification Office, FAA, has the authority to approve AMOCs for this AD, if requested in accordance with the procedures found in 14 CFR 39.19.

(2)Before using any AMOC approved in accordance with § 39.19 on any airplane to which the AMOC applies, notify the appropriate principal inspector in the FAA Flight Standards Certificate Holding District Office. Issued in Renton, Washington, on July 3, 2006. Kalene C. Yanamura, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. E6-11020 Filed 7-12-06; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2006-25327; Directorate Identifier 2006-NM-116-AD] RIN 2120-AA64 Airworthiness Directives; Boeing Model 747-100, 747-100B, 747-100B SUD, 747-200B, 747-300, 747-400, 747-400D, and 747SR Series Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: The FAA proposes to revise an existing airworthiness directive

(AD)that applies to certain Boeing Model 747-100, 747-100B, 747-100B SUD, 747-200B, 747-300, 747-400, 747-400D, and 747SR series airplanes. The existing AD currently requires repetitive inspections to detect cracking of certain lower lobe fuselage frames, and repair if necessary. This proposed AD would specify appropriate service information for certain corrective actions. This proposed AD results from reports indicating that fatigue cracks were found in lower lobe frames on the left side of the fuselage. We are proposing this AD to detect and correct fatigue cracking of certain lower lobe fuselage frames, which could lead to fatigue cracks in the fuselage skin, and consequent rapid decompression of the airplane. DATES: We must receive comments on this proposed AD by August 28, 2006. ADDRESSES: Use one of the following addresses to submit comments on this proposed AD. • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Government-wide rulemaking Web site:* Go to *http://www.regulations.gov* and follow the instructions for sending your comments electronically. • *Mail:* Docket Management Facility; U.S. Department of Transportation, 400 Seventh Street SW., Nassif Building, Room PL-401, Washington, DC 20590. • *Fax:*

(202)493-2251. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. Contact Boeing Commercial Airplanes, P.O. Box 3707, Seattle, Washington 98124-2207, for service information identified in this proposed AD. FOR FURTHER INFORMATION CONTACT: Ivan Li, Aerospace Engineer, Airframe Branch, ANM-120S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue, SW., Renton, Washington 98055-4056; telephone

(425)917-6437; fax

(425)917-6590. SUPPLEMENTARY INFORMATION: Comments Invited We invite you to submit any relevant written data, views, or arguments regarding this proposed AD. Send your comments to an address listed in the ADDRESSES section. Include docket number “Docket No. FAA-2006-25327; Directorate Identifier 2006-NM-116-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments. We will post all comments we receive, without change, to *http://dms.dot.gov* , including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed AD. Using the search function of that Web site, anyone can find and read the comments in a docket, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You may review the DOT's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477-78), or you may visit *http://dms.dot.gov.* Examining the Docket You may examine the AD docket on the Internet at *http://dms.dot.gov* , or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone

(800)647-5227) is located on the plaza level of the Nassif Building at the DOT street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after the Docket Management System receives them. Discussion On April 20, 2006, we issued AD 2006-09-06, amendment 39-14576 (71 FR 25926, May 3, 2006), for certain Boeing Model 747-100, 747-100B, 747-100B SUD, 747-200B, 747-300, 747-400, 747-400D, and 747SR series airplanes. That AD requires repetitive inspections to detect cracking of certain lower lobe fuselage frames, and repair if necessary. That AD resulted from reports indicating that fatigue cracks were found in lower lobe frames on the left side of the fuselage. We issued that AD to detect and correct fatigue cracking of certain lower lobe fuselage frames, which could lead to fatigue cracks in the fuselage skin, and consequent rapid decompression of the airplane. Actions Since Existing AD Was Issued Since we issued AD 2006-09-06, an operator questioned the addition of a reference to Boeing Service Bulletin 747-53A2349, Revision 2, dated April 3, 2003, in paragraph (h)(1) of that AD. A service bulletin reference in that paragraph was not included in the Notice of Proposed Rulemaking

(NPRM)for AD 2006-09-06, but was added in the final rule to clarify the requirements of that paragraph. However, the service bulletin referenced in that paragraph should be Boeing Alert Service Bulletin 747-53A2408, Revision 1, dated April 4, 2002, rather than Boeing Service Bulletin 747-53A2349, Revision 2. Therefore, we have revised paragraph (h)(1) of this NPRM to refer to the correct service bulletin. FAA's Determination and Requirements of the Proposed AD We have evaluated all pertinent information and identified an unsafe condition that is likely to exist or develop on other airplanes of this same type design. For this reason, we are proposing this AD, which would revise AD 2006-09-06 and would retain the requirements of the existing AD. This proposed AD would revise the service information referenced in paragraph (h)(1). Explanation of Editorial Change We have revised the reference to the Boeing 747-400 Structural Repair Manual in paragraph (h)(1)(i) of this proposed AD. The paragraph applies to Group 1 airplanes and should refer to the Boeing 747 Structural Repair Manual because Boeing 747-400 series airplanes are not in Group 1. Costs of Compliance There are about 681 airplanes of the affected design in the worldwide fleet. This proposed AD would affect about 99 airplanes of U.S. registry. The new requirements of this proposed AD add no additional economic burden. The current costs for this AD are repeated for the convenience of affected operators, as follows: The actions in this proposed AD take about 2 work hours per airplane, at an average labor rate of $80 per work hour. Based on these figures, the estimated cost of both the retained and proposed actions for U.S. operators is $15,840, or $160 per airplane, per inspection cycle. Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in subtitle VII, part A, subpart III, section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. For the reasons discussed above, I certify that the proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and place it in the AD docket. See the ADDRESSES section for a location to examine the regulatory evaluation. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The Federal Aviation Administration

(FAA)amends § 39.13 by removing amendment 39-14576 (71 FR 25926, May 3, 2006) and adding the following new airworthiness directive (AD): **Boeing:** Docket No. FAA-2006-25327; Directorate Identifier 2006-NM-116-AD. Comments Due Date

(a)The FAA must receive comments on this AD action by August 28, 2006. Affected ADs

(b)This AD revises AD 2006-09-06. Applicability

(c)This AD applies to Boeing Model 747-100, 747-100B, 747-100B SUD, 747-200B, 747-300, 747-400, 747-400D, and 747SR series airplanes, certificated in any category, as identified in Boeing Alert Service Bulletin 747-53A2408, Revision 1, dated April 4, 2002. Unsafe Condition

(d)This AD results from reports indicating that fatigue cracks were found in lower lobe frames on the left side of the fuselage. We are issuing this AD to detect and correct fatigue cracking of certain lower lobe fuselage frames, which could lead to fatigue cracks in the fuselage skin, and consequent rapid decompression of the airplane. Compliance

(e)You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done. Restatement of the Requirements of AD 99-07-12, With Additional Information for Group 2 Airplanes Initial Inspections

(f)For airplanes on which the initial detailed internal inspection of the Section 46 lower lobe frames required by paragraph (f)(2) or (i)(2) of AD 2005-20-30, amendment 39-14327, has not been accomplished: Perform a detailed visual inspection to detect cracking of the lower lobe fuselage frames from Body Station 1820 to Body Station 2100, in accordance with the Accomplishment Instructions of Boeing Alert Service Bulletin 747-53A2408, dated April 25, 1996; or Boeing Alert Service Bulletin 747-53A2408, Revision 1, dated April 4, 2002; as applicable; at the later of the applicable times specified in paragraph (f)(1), (f)(2), or (f)(3) of this AD.

(1)For all airplanes: Prior to the accumulation of 15,000 total flight cycles; or

(2)For Group 1 airplanes identified in Revision 1 of the service bulletin: Within 1,500 flight cycles or 18 months after May 5, 1999 (the effective date of AD 99-07-12), whichever occurs first.

(3)For Group 2 airplanes identified in Revision 1 of the service bulletin: Within 1,500 flight cycles or 18 months after June 7, 2006, whichever occurs first. Note 1: Paragraphs (f)(2) and (i)(2) of AD 2005-20-30 require a detailed inspection to detect cracks in the Section 46 lower lobe frames, in accordance with Boeing Service Bulletin 747-53A2349, Revision 2, dated April 3, 2003. The initial inspection is required prior to the accumulation of 22,000 total flight cycles; or within 1,000 flight cycles after June 11, 1993 (the effective date of AD 93-08-12, amendment 39-8559), or November 16, 2005 (the effective date of AD 2005-20-30), depending on previous inspections accomplished; whichever occurs later. Note 2: For the purposes of this AD, a detailed inspection is: “An intensive examination of a specific item, installation, or assembly to detect damage, failure, or irregularity. Available lighting is normally supplemented with a direct source of good lighting at an intensity deemed appropriate. Inspection aids such as mirror, magnifying lenses, etc., may be necessary. Surface cleaning and elaborate procedures may be required.” Repetitive Inspections

(g)If no cracking is detected during the inspection required by paragraph

(f)of this AD, repeat the inspection thereafter at intervals not to exceed 3,000 flight cycles. Corrective Actions

(h)If any cracking is detected during any inspection required by paragraph

(f)of this AD, prior to further flight, accomplish paragraphs (h)(1) and (h)(2) of this AD:

(1)Within 20 inches of the crack location on the frame, perform a detailed inspection of the adjacent structure to detect cracking. As of the effective date of this AD, the detailed inspection must be done in accordance with Boeing Alert Service Bulletin 747-53A2408, Revision 1, dated April 4, 2002. If any cracking is detected during any detailed inspection done in accordance with paragraph

(f)or (h)(1) of this AD, prior to further flight, repair in accordance with paragraph (h)(1)(i) or (h)(1)(ii) of this AD, as applicable.

(i)For Group 1 airplanes: Using a method approved in accordance with the procedures specified in paragraph

(j)of this AD. The Boeing 747 Structural Repair Manual, Subject 53-10-04, Figure 67 or 90, is one approved method.

(ii)For Group 2 airplanes: Using a method approved in accordance with the procedures specified in paragraph

(j)of this AD. The Boeing 747-400 Structural Repair Manual, Subject 53-60-07, Repair 1 or 2, is one approved method.

(2)Repeat the inspection required by paragraph

(f)of this AD thereafter at intervals not to exceed 3,000 flight cycles. Optional Terminating Inspection

(i)Accomplishment of the initial detailed inspection of the Section 46 lower lobe frames required by paragraph (f)(2) or (i)(2) of AD 2005-20-30 constitutes terminating action for the requirements of this AD only for airplanes identified in Boeing Alert Service Bulletin 747-53A2408, Revision 1, dated April 4, 2002, as Group 1 airplanes. Accomplishment of the initial detailed inspection of the Section 46 lower lobe frames required by paragraph

(f)of AD 2006-05-02 constitutes terminating action for the requirements of this AD only for airplanes identified in Boeing Alert Service Bulletin 747-53A2408, Revision 1, dated April 4, 2002, as Group 2 airplanes. Alternative Methods of Compliance (AMOCs) (j)(1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested in accordance with the procedures found in 14 CFR 39.19.

(3)An AMOC that provides an acceptable level of safety may be used for any repair required by this AD, if it is approved by an Authorized Representative for the Boeing Commercial Airplanes Delegation Option Authorization Organization who has been authorized by the Manager, Seattle ACO, to make those findings. For a repair method to be approved, the repair must meet the certification basis of the airplane.

(4)AMOCs approved previously in accordance with AD 99-07-12, amendment 39-11097, are approved as AMOCs for the corresponding provisions of this AD. Issued in Renton, Washington, on July 5, 2006. Ali Bahrami, Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. E6-11019 Filed 7-12-06; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF COMMERCE Bureau of Industry and Security 15 CFR Parts 740, 742, 748, 754, and 772 [Docket No. 030425102-6179-03] RIN 0694-AC20 Mandatory Use of Simplified Network Application Processing System AGENCY: Bureau of Industry and Security, Commerce. ACTION: Proposed rule—withdrawal. SUMMARY: The Bureau of Industry and Security

(BIS)is withdrawing a proposed rule that would have made use of the Simplified Network Application Process

(SNAP)mandatory and that would have comprehensively revised the provisions of the Export Administration Regulations

(EAR)that govern electronic filing. BIS is continuing to work on improvements to its on-line application system and will issue new rules as needed to implement those improvements. DATES: The proposed rule is withdrawn as of July 13, 2006. FOR FURTHER INFORMATION CONTACT: William Arvin, Office of Exporter Services, Regulatory Policy Division: e-mail *warvin@bis.doc.gov* , telephone

(202)482-2440. SUPPLEMENTARY INFORMATION: Background On November 12, 2003 (68 FR 64009), the Bureau of Industry and Security published a proposed rule that would have required that all applications for export licenses, reexport licenses, license exception AGR submissions, classification requests and encryption review requests be submitted via a to-be-instituted revised Simplified Network Application Process unless certain enumerated exceptions applied, and that would have extensively revised the requirements for electronic filing of certain applications (the November 2003 proposed rule). The November 2003 proposed rule would also have allowed organizations that use the system, once registered, to add, remove and adjust the authority level of individual users authorized to file applications and notices on behalf of that organization. The November 2003 proposed rule would have permitted the electronic filing of attachments, and required that all attachments to applications and notices be in text searchable pdf format. The original comment period expired on January 12, 2004, but was extended to February 12, 2004 (69 FR 1685, January 12, 2004). BIS received 16 comments on the proposed rule. Although a number of commenters generally favored expanded electronic filing in principle, many were opposed to the requirement that attachments be in text searchable pdf format, generally citing the cost of producing such documents, particularly if the source documents had to be scanned from poor quality, oversized or bound originals. Other commenters opposed making electronic filing mandatory, and still others, although not opposed to mandatory electronic filing in principle, stated that no mandatory filing rule should be imposed until after the improved system had been deployed and was operating reliably. Since the publication of the November 2003 proposed rule, BIS has reassessed its efforts to improve electronic filing of license applications and as a result of that reassessment, determined to release improvements and modifications to its electronic filing system in small installments rather than in the single complete restructuring that the November 2003 proposed rule contemplated. BIS may at times find it necessary to amend the Export Administration Regulations to conform with some of those installments. However, BIS has concluded that a single rule comprehensively rewriting the EAR provisions relating to electronic filing as it proposed in the November 2003 proposed rule no longer is consistent with the manner in which it plans to modernize its electronic filling process. In addition, BIS agrees with the commenters to the November 2003 proposed rule who stated that any revised electronic system should be put into place and be operating reliably before any rule making its use mandatory is published. Accordingly, BIS is withdrawing the November 2003 proposed rule. BIS is continuing to work on improvements to its on-line application system and will issue new rules as needed to implement those improvements. Dated: June 30, 2006. Matthew S. Borman, Deputy Assistant Secretary for Export Administration. [FR Doc. E6-11056 Filed 7-12-06; 8:45 am] BILLING CODE 3510-33-P DEPARTMENT OF ENERGY Federal Energy Regulatory Commission 18 CFR Parts 366, 367, 368, 369 and 375 [Docket No. RM06-11-000] Financial Accounting, Reporting and Records Retention Requirements Under the Public Utility Holding Company Act of 2005 Issued June 30, 2006. AGENCY: Federal Energy Regulatory Commission. ACTION: Notice of Proposed Rulemaking: Notice of agenda, panelists and questions for July 18, 2006 Technical Conference. SUMMARY: On April 21, 2006, the Federal Energy Regulatory Commission issued a Notice of Proposed Rulemaking in the above-docketed proceeding concerning Financial Accounting, Reporting and Records Retention Requirements Under the Public Utility Holding Company Act of 2005, 71 FR 28464, May 16, 2006. The Commission is convening a technical conference on July 18, 2006, to identify issues associated with the proposed Uniform System of Accounts for Centralized Service Companies, the proposed records retention requirements for holding companies and service companies, and the Revised Form 60. By this notice, the Commission is providing the agenda, panelists and a list of questions that will be addressed by the panelists at this conference. DATES: Conference will be held on July 18, 2006. FOR FURTHER INFORMATION CONTACT: Julia A. Lake (Legal Information), Office of the General Counsel—Energy Markets, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426. Telephone:

(202)502-8370. E-mail: *julia.lake@ferc.gov.* SUPPLEMENTARY INFORMATION: Notice of Agenda, Panelists and Questions As announced on April 21 and June 16, 2006, the Federal Energy Regulatory Commission (Commission) will hold a technical conference and workshop in the above-referenced proceeding on July 18, 2006, in the Commission Meeting Room. The meeting will begin at 9 a.m. (Eastern Daylight Savings Time) and conclude at approximately 1:30 p.m. All interested persons are invited to attend. There is *no* registration fee to attend this conference. Nine comments were filed in response to the proposed Uniform System of Accounts for Centralized Service Companies, the proposed records retention requirements for holding companies and service companies, and the revised FERC Form No. 60. 1 These comments raise a number of issues. We request that the panel members address the following issues raised by commentors: 1 *Financial Accounting, Reporting and Records Retention Requirements under the Public Utility Holding Company Act of 2005, Notice of Proposed Rulemaking* , 71 FR 28464 (May 16, 2006), FERC Statutes and Regulations ¶ 32,600 (2006). 1. Is a separate Uniform System of Accounts necessary for service companies? 2. Are the proposed accounting and reports too burdensome to comply with? What parts cause the most burden? 3. Should a structured reporting format be required for service companies? 4. If a separate Uniform System of Accounts and structured reports are adopted, what are the most significant modifications to what was proposed in the NOPR that should be considered? 5. What should the effective date be for the new requirements? Transcripts of the meeting will be available immediately for a fee from Ace Reporting Company ((202) 347-3700 or 1-(800) 336-6646). They will be available for free on the Commission's eLibrary system and on the events calendar about two weeks after the conference. There will be open microphones for conference attendees to present their questions to the panelists and Commission staff. FERC conferences and meetings are accessible under section 508 of the Rehabilitation Act of 1973. For accessibility accommodations, please send an e-mail to *accessibility@ferc.gov* or call toll free

(866)208-3372 (voice) or

(202)502-8659 (TTY), or send a fax to

(202)208-2106 with the required accommodations. Attached is the agenda, including the panelists who will speak at the conference. Questions about the conference should be directed to: Julia A. Lake, Office of the General Counsel, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426.

(202)502-8370. *Julia.lake@ferc.gov.* Magalie R. Salas, Secretary. Agenda for Financial Accounting, Reporting and Records Retention Requirements Under PUHCA 2005 Technical Conference—July 18, 2006 9-9:10 a.m. Introductory Remarks by Susan Court, Director, Office of Enforcement (OE). 9:10-9:20 a.m. Overview by Janice Garrison Nicholas, Director, Division of Financial Regulation, Office of Enforcement. 9:15-11 a.m. Association and Industry Panel. *Panelists:* —Henri Bartholomot—Director, Regulatory Legal Issues, Edison Electric Institute. —David Stringfellow—Director of Accounting, Edison Electric Institute. —Kathleen McNulty-Kropp—Manager, Regulatory Accounting Policy and Reporting, Xcel Energy Inc. for Edison Electric Institute-William Richert—Assistant Controller, National Grid USA. —Sandra Bennett—Assistant Controller, American Electric Power, Inc. —Beverly M. Holmes—Director of Accounting, Southern Company Services, Inc. 11-11:15 a.m. Break. 11:15 a.m.-1 p.m. State Commissions and Other Interest Groups Panel. *Panelists:* —Thomas J. Ferris—Audit Manager-Consultant, Gas and Energy Division, Public Service Commission of Wisconsin. —Joseph Buckley—Utility Specialist, Public Utilities Commission of Ohio. —James Mitchell—Supervisor, Utility, Accounting and Finance, New York State Public Service Commission. —Steven Ruppel—Contract Compliance Audit Manager, Florida Municipal Power Agency. 1-1:15 p.m. Wrap up Questions and Answers. 1:15-1:30 p.m. Concluding Remarks. [FR Doc. E6-11001 Filed 7-12-06; 8:45 am] BILLING CODE 6717-01-P DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 1 [REG-118897-06] RIN 1545-BF67 United States Dollar Approximate Separate Transactions Method AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Notice of proposed rulemaking. SUMMARY: This document contains a proposed regulation which provides the translation rates that must be used when translating into dollars certain items and amounts transferred by a qualified business unit

(QBU)to its home office or parent corporation for purposes of computing dollar approximate separate transactions method (DASTM) gain or loss. DATES: Written or electronic comments and requests for a public hearing must be received by October 11, 2006. ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-118897-06), room 5203, Internal Revenue Service, PO Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG-118897-06), Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue, NW., Washington, DC, or sent electronically, via the IRS Internet site at *http://www.irs.gov/regs* or via the Federal eRulemaking Portal at *http://www.regulations.gov* (IRS REG-118897-06). FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations, Sheila Ramaswamy, at

(202)622-3870; concerning submissions of comments, Richard *Hurst@irscounsel.treas.gov,*

(202)622-7180 (not toll-free numbers). SUPPLEMENTARY INFORMATION: Background Generally, a taxpayer and each of its qualified business units

(QBUs)must make all determinations under subtitle A of the Internal Revenue Code in its respective functional currency. See § 1.985-1(a)(1). For taxable years beginning after August 24, 1994, a U.S. corporation's QBU that would otherwise be required to use a hyperinflationary currency as its functional currency generally must use the dollar as its functional currency and must compute income or loss under the DASTM method of accounting described in § 1.985-3. See § 1.985-1(b)(2)(ii). Section 1.985-3(d)(3) contains a rule for translating into dollars dividends, certain transfers, and returns of capital from the QBU to its home office or parent corporation. On March 8, 2005, Notice 2005-27, 2005-13 IRB 795, (see § 601.601(d)(2) of this chapter), announced the intention to amend § 1.985-3(d)(3) regarding the proper exchange rate for determining DASTM gain or loss when translating certain current and historical assets upon a transfer from a QBU to its home office or parent corporation, as the case may be. Explanation of Provisions Under the DASTM method of accounting, a QBU's income or loss for a taxable year is computed in U.S. dollars and adjusted to account for its DASTM gain or loss. See § 1.985-3(b). A QBU's DASTM gain or loss for a taxable year is determined under § 1.985-3(d) by first computing the QBU's change in net worth from the prior year and then making specified adjustments. The QBU's change in net worth is computed by comparing the year-end balance sheets for the current and preceding taxable years. See § 1.985-3(d)(1)(i). Special rules provide that some balance-sheet items are translated at the exchange rate for the translation period in which the cost of the item was incurred and so do not give rise to DASTM gain or loss from year to year (“historical items”). See § 1.985-3(d)(5). Other items are translated at the exchange rate for the last translation period for the taxable year and therefore do give rise to DASTM gain or loss (“current items”). See § 1.985-3(d)(5). The classification of an item as historical or current generally reflects the extent to which the item's dollar value changes with fluctuations in exchange rates. For example, the dollar value of a financial asset, such as a unit of hyperinflationary local currency, necessarily changes with fluctuations in exchange rates. Accordingly, a financial asset generally is a current item. See § 1.985-3(d)(5)(iv). By contrast, the value of a nonfinancial asset generally does not change with fluctuations in exchange rates. Accordingly, a nonfinancial asset generally is an historical item. See § 1.985-3(d)(5)(v). The computed change in the QBU's net worth is then adjusted to reflect transactions that increase or decrease the QBU's net worth without affecting the QBU's income or loss. For example, an asset transferred from a QBU branch to its home office decreases the QBU's net worth but does not affect the QBU's income or loss and so must be added back to the QBU's net worth for purposes of computing DASTM gain or loss. See § 1.985-3(d)(3). The DASTM method of accounting provides that adjustments described in the preceding paragraphs generally shall be translated into dollars at the exchange rate on the date the amount is paid. See § 1.985-3(d)(3). This rule ensures that the QBU branch properly takes into account a current item's change in value due to currency fluctuations while the item was in the QBU branch. However, applying this translation rule to historical items could potentially lead to distortions in the calculation of DASTM gain or loss. Because the value of historical items generally does not change with fluctuations in exchange rates, translating adjustments relating to historical items at the exchange rate on the date of distribution or transfer would inappropriately give rise to DASTM gain or loss. The potentially anomalous results that may arise due to the application of the existing translation rule in § 1.985-3(d)(3) can be prevented by modifying the rule to ensure that only the assets whose dollar value changes with fluctuations in exchange rates will give rise to DASTM gain or loss upon a transfer from a QBU to its home office. Accordingly, this proposed regulation amends § 1.985-3(d)(3) in accordance with Notice 2005-27 as follows. The proposed regulation provides that if the item giving rise to the adjustment is a current asset which would be translated under § 1.985-3(d)(5) at the exchange rate for the last translation period of the taxable year if it were on the QBU's year-end balance sheet, the item will be translated at the exchange rate on the date the item is transferred. However, if the item giving rise to the adjustment is a historical asset which would be translated under § 1.985-3(d)(5) at the exchange rate for the translation period in which the cost of the item was incurred if it were on the QBU's year-end balance sheet, the item will be translated at the same historical rate. Proposed Effective Date Consistent with Notice 2005-27, this regulation is proposed to be effective for any transfer, dividend, or distribution that is a return of capital that is made after March 8, 2005, and that gives rise to an adjustment under § 1.985-3(d)(3). Special Analyses It has been determined that this notice of proposed rulemaking is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It has also been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations, and because these regulations do not impose a collection of information on small entities, the provisions of the Regulatory Flexibility Act (5 U.S.C. chapter 6) do not apply. Pursuant to section 7805(f) of the Internal Revenue Code, this notice of proposed rulemaking will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business. Comments and Requests for Public Hearing Before these proposed regulations are adopted as final regulations, consideration will be given to any written (a signed original and eight

(8)copies) or electronic comments that are submitted timely to the IRS. The IRS and Treasury Department request comments on the clarity of the proposed rules and how they can be made easier to understand. All comments will be available for public inspection and copying. A public hearing will be scheduled if requested in writing by any person that timely submits written comments. If a public hearing is scheduled, notice of the date, time, and place for a public hearing will be published in the **Federal Register** . Drafting Information The principal author of these proposed regulations is Sheila Ramaswamy, Office of Associate Chief Counsel (International). However, other personnel from the IRS and Treasury Department participated in their development. List of Subjects in 26 CFR Part 1 Income taxes, Reporting and recordkeeping requirements. Proposed Amendment to the Regulations Accordingly, 26 CFR part 1 is proposed to be amended as follows: PART 1—INCOME TAXES **Paragraph 1.** The authority citation for part 1 continues to read in part as follows: Authority: 26 U.S.C. 7805 * * * **Par. 2.** Section 1.985-3 is amended by revising paragraph (d)(3) to read as follows: § 1.985-3 United States dollar approximate separate transactions method.

(d)* * *

(3)*Positive adjustments* —(i) *In general.* The items described in this paragraph (d)(3) are dividend distributions for the taxable year and any items that decrease net worth for the taxable year but that generally do not affect income or loss or earnings and profits (or a deficit in earnings and profits). Such items include a transfer to the home office of a QBU branch and a return of capital.

(ii)*Translation.* Except as provided by ruling or administrative pronouncement, items described in paragraph (d)(3)(i) of this section shall be translated into dollars as follows:

(A)If the item giving rise to the adjustment would be translated under paragraph (d)(5) of this section at the exchange rate for the last translation period of the taxable year if it were shown on the QBU's year-end balance sheet, such item shall be translated at the exchange rate on the date the item is transferred.

(B)If the item giving rise to the adjustment would be translated under paragraph (d)(5) of this section at the exchange rate for the translation period in which the cost of the item was incurred if it were shown on the QBU's year-end balance sheet, such item shall be translated at the same historical rate.

(iii)*Effective date.* Paragraph (d)(3)(ii) of this section is applicable for any transfer, dividend, or distribution that is a return of capital that is made after March 8, 2005, and that gives rise to an adjustment under this paragraph (d)(3). Mark E. Matthews, Deputy Commissioner for Services and Enforcement. [FR Doc. E6-10998 Filed 7-12-06; 8:45 am] BILLING CODE 4830-01-P DEPARTMENT OF THE TREASURY 31 CFR Part 103 RIN 1506-AA81 Financial Crimes Enforcement Network; Withdrawal of the Finding of Primary Money Laundering Concern and the Notice of Proposed Rulemaking Against Multibanka AGENCY: Financial Crimes Enforcement Network, Department of the Treasury. ACTION: Withdrawal of the notice of proposed rulemaking. SUMMARY: This document withdraws our April 26, 2005 finding that joint stock company Multibanka (“Multibanka” or the “bank”) is a financial institution of primary money laundering concern and our notice of proposed rulemaking recommending the imposition of a special measure, pursuant to the authority contained in 31 U.S.C. 5318A of the Bank Secrecy Act. DATES: The notice of proposed rulemaking is withdrawn as of July 13, 2006. FOR FURTHER INFORMATION CONTACT: Regulatory Policy and Programs Division, Financial Crimes Enforcement Network,

(800)949-2732. SUPPLEMENTARY INFORMATION: I. Background A. Statutory Provisions On October 26, 2001, the President signed into law the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56 (“USA PATRIOT Act”). Title III of the USA PATRIOT Act amends the anti-money laundering provisions of the Bank Secrecy Act, codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959, and 31 U.S.C. 5311-5314 and 5316-5332, to promote the prevention, detection, and prosecution of money laundering and the financing of terrorism. Regulations implementing the Bank Secrecy Act appear at 31 CFR part 103. The authority of the Secretary of the Treasury (the “Secretary”) to administer the Bank Secrecy Act and its implementing regulations has been delegated to the Director of the Financial Crimes Enforcement Network (the “Director”). 1 The Bank Secrecy Act authorizes the Director to issue regulations requiring all financial institutions defined as such in the Bank Secrecy Act to maintain or file certain reports or records that have been determined to have a high degree of usefulness in criminal, tax, or regulatory investigations or proceedings, or in the conduct of intelligence or counter-intelligence activities, including analysis, to protect against international terrorism, and to implement anti-money laundering programs and compliance procedures. 2 1 Therefore, references to the authority of the Secretary of the Treasury under section 311 of the USA PATRIOT Act apply equally to the Director of the Financial Crimes Enforcement Network. 2 Language expanding the scope of the Bank Secrecy Act to intelligence or counter-intelligence activities to protect against international terrorism was added by section 358 of the USA PATRIOT Act. Section 311 of the USA PATRIOT Act added section 5318A to the Bank Secrecy Act, granting the Secretary the authority, after finding that reasonable grounds exist for concluding that a foreign jurisdiction, foreign financial institution, class of international transactions, or type of account is of “primary money laundering concern,” to require domestic financial institutions and domestic financial agencies to take certain “special measures” against the primary money laundering concern. Section 311 identifies factors for the Secretary to consider and Federal agencies to consult before he may find that reasonable grounds exist for concluding that a jurisdiction, financial institution, class of transactions, or type of account is of primary money laundering concern. The statute also provides similar procedures, including factors and consultation requirements, for selecting the specific special measures to be imposed against the primary money laundering concern. Taken as a whole, section 311 provides the Secretary with a range of options that can be adapted to target specific money laundering and terrorist financing concerns most effectively. These options provide the authority to bring additional and useful pressure on those jurisdictions and institutions that pose money laundering threats and the ability to take steps to protect the U.S. financial system. Through the imposition of various special measures, we can: Gain more information about the concerned jurisdictions, financial institutions, transactions, and accounts; monitor more effectively the respective jurisdictions, financial institutions, transactions, and accounts; and ultimately protect U.S. financial institutions from involvement with jurisdictions, financial institutions, transactions, or accounts that pose a money laundering concern. Before making a finding that reasonable grounds exist for concluding that a foreign financial institution is of primary money laundering concern, the Secretary is required by the Bank Secrecy Act to consult with both the Secretary of State and the Attorney General. In addition to these consultations, when finding that a foreign financial institution is of primary money laundering concern, the Secretary is required by section 311 to consider “such information as the Secretary determines to be relevant, including the following potentially relevant factors:” • The extent to which such financial institution is used to facilitate or promote money laundering in or through the jurisdiction; • The extent to which such financial institution is used for legitimate business purposes in the jurisdiction; and • The extent to which such action is sufficient to ensure, with respect to transactions involving the institution operating in the jurisdiction, that the purposes of the Bank Secrecy Act continue to be fulfilled, and to guard against international money laundering and other financial crimes. If we determine that reasonable grounds exist for concluding that a foreign financial institution is of primary money laundering concern, we must determine the appropriate special measure(s) to address the specific money laundering risks. Section 311 provides a range of special measures that can be imposed, individually or jointly, in any combination, and in any sequence. 3 In the imposition of special measures, we follow procedures similar to those for finding a foreign financial institution to be of primary money laundering concern, but we also engage in additional consultations and consider additional factors. Section 311 requires us to consult with other appropriate Federal agencies and parties 4 and to consider the following specific factors: 3 Available special measures include requiring:

(1)Recordkeeping and reporting of certain financial transactions;

(2)collection of information relating to beneficial ownership;

(3)collection of information relating to certain payable-through accounts;

(4)collection of information relating to certain correspondent accounts; and

(5)prohibition or conditions on the opening or maintaining of correspondent or payable-through accounts. 31 U.S.C. 5318A(b)(1)-(5). For a complete discussion of the range of possible countermeasures, see 68 FR 18917 (April 17, 2003) (proposing to impose special measures against Nauru). 4 Section 5318A(a)(4)(A) requires the Secretary to consult with the Chairman of the Board of Governors of the Federal Reserve System, any other appropriate Federal banking agency, the Secretary of State, the U.S. Securities and Exchange Commission, the Commodity Futures Trading Commission, the National Credit Union Administration, and, in our sole discretion, “such other agencies and interested parties as the Secretary may find to be appropriate.” The consultation process must also include the Attorney General, if the Secretary is considering prohibiting or imposing conditions upon the opening or maintaining of a correspondent account by any domestic financial institution or domestic financial agency for the foreign financial institution of primary money laundering concern. • Whether similar action has been or is being taken by other nations or multilateral groups; • Whether the imposition of any particular special measure would create a significant competitive disadvantage, including any undue cost or burden associated with compliance, for financial institutions organized or licensed in the United States; • The extent to which the action or the timing of the action would have a significant adverse systemic impact on the international payment, clearance, and settlement system, or on legitimate business activities involving the particular institution; and • The effect of the action on U.S. national security and foreign policy. 5 5 Classified information used in support of a section 311 finding of primary money laundering concern and imposition of special measure(s) may be submitted by the Department of the Treasury to a reviewing court *ex parte* and *in camera.* See section 376 of the Intelligence Authorization Act for Fiscal Year 2004, Public Law 108-177 (amending 31 U.S.C. 5318A by adding new paragraph (f)). B. Multibanka Multibanka is headquartered in Riga, the capital of the Republic of Latvia (“Latvia”). Multibanka is the oldest commercial bank in Latvia and is among the smallest of Latvia's 23 banks. It has: Four foreign offices, which are located in Russia, Ukraine, and Belarus; five domestic branches; and one leasing subsidiary, Multilizings. Multibanka provides a full range of banking services in the Latvian market and is a member of the Riga Stock Exchange, the Central Depository, and the Association of Commercial Banks of Latvia. Multibanka currently has direct ties to the U.S. financial system through one of its correspondent relationships. II. The 2005 Finding and Subsequent Developments A. The 2005 Finding Based upon review and analysis of relevant information, consultations with relevant Federal agencies and parties, and after consideration of the factors enumerated in section 311, in April 2005 the Secretary, through his delegate, the Director of the Financial Crimes Enforcement Network, found that reasonable grounds exist for concluding that Multibanka is a financial institution of primary money laundering concern. This finding was published in a notice of proposed rulemaking which proposed prohibiting covered financial institutions from, directly or indirectly, opening or maintaining correspondent accounts in the United States for Multibanka or any of its branches, offices, or subsidiaries, pursuant to the authority under 31 U.S.C. 5318A. 6 6 See 70 FR 21362 (April 26, 2005). The notice of proposed rulemaking outlined the various factors supporting the finding and proposed prohibition. In finding Multibanka to be of primary money laundering concern, we determined that: • Multibanka was used by criminals to facilitate or promote money laundering. In particular, we determined Multibanka was an important banking resource for illicit shell companies and financial fraud rings, allowing criminals to pursue illegal financial activities. • Any legitimate business use of Multibanka appeared to be significantly outweighed by its use to promote or facilitate money laundering and other financial crimes. • A finding that Multibanka was a financial institution of primary money laundering concern and prohibiting the maintenance of correspondent accounts for that financial institution would prevent suspect accountholders at Multibanka from accessing the U.S. financial system to facilitate money laundering and would bring criminal conduct occurring at or through Multibanka to the attention of the international financial community, thus serving the purposes of the Bank Secrecy Act and guarding against international money laundering and other financial crimes. We determined, based on a variety of sources, that Multibanka had been used to facilitate or promote money laundering based in part on its lax identification and verification of accountholders and on its weak internal controls. In addition, the proceeds of alleged illicit activity had been transferred to or through accounts held by Multibanka at U.S. financial institutions. B. Jurisdictional Developments Latvia's geographical position, situated by the Baltic Sea and bordering Russia, Estonia, Belarus, and Lithuania, makes it an attractive transit country for both legitimate and illegitimate trade. Sources of illegitimate trade include counterfeiting, arms trafficking, contraband smuggling, and other crimes. It is believed that most of Latvia's narcotics trafficking is conducted by organized crime groups that began with cigarette and alcohol smuggling and then progressed to narcotics. Latvian authorities recently have sought tighter legislative controls designed to fight money laundering and other financial crime. However, Latvia's role as a regional financial center, the number of commercial banks (23), and those banks' sizeable non-resident deposit base continue to make it vulnerable to money laundering. Latvia has taken a number of significant steps to address the reported money laundering risks and corruption highlighted in the notice of proposed rulemaking. The Parliament of Latvia recently passed a new law, *On the Declaration of Cash on the State Border,* which will go into effect on July 1, 2006. 7 The law is aimed at preventing money laundering consistent with the United Nations Convention Against Transnational Organized Crime and the European Union draft regulation on the control of cash leaving and entering the European Community. In 2005, Latvian law was amended to broaden supervisory authority to revoke banking licenses and to allow enforcement agencies greater access to bank account information. The amendments: Provide for fines of between 5,000 and 100,000 LATS (equivalent to over $8,687.50 and over $173,750.00, respectively) against banks in violation of the anti-money laundering laws; include a definition of and procedures for determining who qualifies as a “true beneficiary”; and introduce criminal liability for providing false information to banks. Additionally, Latvia has: Banned the establishment of shell banks; clarified the authority of Latvian financial institutions to demand customer disclosure regarding the source of funds; and allowed for the sharing of information between financial institutions on suspicious activities. 7 The law requires that individuals crossing the Latvian border with the equivalent of 10,000 Euros (€10,000) in coins, cash, and/or certain monetary instruments to complete a form stating the origin of the currency or monetary instruments, the purpose or use of the currency or monetary instruments, and the receiver of the currency or monetary instruments. In terms of implementation, the Latvian authorities have made strides in strengthening their anti-money laundering regulation and supervision and in developing more robust anti-money laundering examination procedures. To ensure proper protection of Latvia's financial sector, authorities will need to continue their efforts to effectively implement and enforce their strengthened anti-money laundering regime. C. Multibanka's Subsequent Developments Multibanka has informed us that it has taken significant steps to address deficiencies in its anti-money laundering programs and controls. Although some of these efforts were initiated prior to the finding that Multibanka was a financial institution of primary money laundering concern, the bank is continuing to improve its anti-money laundering procedures and is working to ensure that these are translated effectively into practice. First, the bank revised its policies, procedures, and internal controls, and established an Anti-Money Laundering Manual to address previously identified weaknesses, which included lax practices in the identification and verification of accountholders and insufficient internal controls. Second, it committed to review, and has since reviewed, its entire portfolio of accounts with the aim of verifying the identities of all accountholders. We understand that, in connection with this review process, the bank terminated relationships with more than 2,600 customers that were unwilling or unable to comply with Multibanka's enhanced information collection and verification standards. As a result, 98 percent of the bank's non-resident accounts and more than 50 percent of the bank's resident accounts have been closed. Third, Multibanka retained the services of an independent, international accounting firm to identify weaknesses in its anti-money laundering program and to assist the bank in its goal of reaching a best international practices standard for its anti-money laundering program and internal controls. Together, the bank and the international accounting firm have created an action plan to address deficiencies and have targeted compliance dates, and the bank has evinced implementation of the plan. Fourth, the bank has made organizational changes to coordinate and lead anti-money laundering activities, including the creation of a Compliance Committee, a Finance Monitoring Department, a Corporate Customer Department, and a Customer Management Division. In addition to hiring additional employees to assist with compliance, the bank has enhanced training opportunities for bank personnel with key anti-money laundering responsibilities. Fifth, in an effort to improve internal controls, the bank has enhanced and continues to enhance information technology systems that assist in the automated screening of accountholders, beneficial owners, and other persons and transactions that need to be flagged for enhanced scrutiny or possible reporting. We believe that Multibanka has been forthcoming in addressing the concerns that we identified in the notice of proposed rulemaking and has instituted measures to guard against money laundering abuses. The bank, through its counsel, initiated meetings with us in May and October 2005, with the intent to demonstrate the remedial measures taken. We permitted the bank to submit additional documentation to demonstrate its continued efforts and the bank has provided copies of its revised policies, procedures, and internal controls. Multibanka has significantly improved its anti-money laundering policies, procedures, and internal controls, has enhanced its organizational structure, and has strengthened its accountholder identification and verification requirements. We believe that the bank's cumulative efforts demonstrate its continuing commitment to fighting money laundering and other financial crimes. If a financial institution that is the object of a proposed section 311 special measure is determined to no longer be of primary money laundering concern, we have authority to withdraw the finding and to withdraw any related proposal to impose a special measure. In light of Multibanka's significant remedial measures, described above, to address deficiencies in its anti-money laundering program and internal controls, particularly the bank's attempts to review its accounts to focus on legitimate business customers, we believe that the risk of criminals using Multibanka to facilitate or promote money laundering has decreased. III. Notice of Proposed Rulemaking and Comments In the April 26, 2005 notice of proposed rulemaking, we proposed to impose the fifth special measure authorized by 31 U.S.C. 5318A(b)(5) against Multibanka, which would prohibit U.S. financial institutions from opening or maintaining correspondent or payable-through accounts for Multibanka in the United States. We received six comments on the notice of proposed rulemaking. Three comments, one each from an industry association, a firm providing search software to financial institutions, and a private individual, addressed the finding and rulemaking under Section 311 generally, but did not provide specifics with respect to Multibanka. The Latvian financial intelligence unit and a Latvian financial services supervisory authority jointly filed a comment regarding Latvian anti-money laundering requirements, but similarly provided no specifics with respect to Multibanka. Legal counsel to Multibanka submitted two comment letters, and representatives of Multibanka met with us to discuss the anti-money laundering efforts described in their comments. IV. Withdrawal of the Finding of Multibanka as a Financial Institution of Primary Laundering Concern For the reasons set forth above, we hereby withdraw our finding that Multibanka is a financial institution of primary money laundering concern as of July 13, 2006. V. Withdrawal of Notice of Proposed Rulemaking For the reasons set forth above, we hereby withdraw the notice of proposed rulemaking imposing the fifth special measure authorized by 31 U.S.C. 5318A(b)(5) against Multibanka for purposes of section 5318A as published in the **Federal Register** on April 26, 2005 (70 FR 21362). Dated: May 12, 2006. Robert W. Werner, Director, Financial Crimes Enforcement Network. [FR Doc. E6-10941 Filed 7-12-06; 8:45 am] BILLING CODE 4810-02-P DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 100 [CGD05-06-066] RIN 1625-AA08 Special Local Regulations for Marine Events; Sunset Lake, Wildwood Crest, NJ AGENCY: Coast Guard, DHS. ACTION: Notice of proposed rulemaking. SUMMARY: The Coast Guard proposes to establish permanent special local regulations during the “Sunset Lake Hydrofest”, a marine event to be held annually on the last weekend in September or the first weekend in October on the waters of Sunset Lake, Wildwood Crest, New Jersey. For 2006 this marine event will be held on September 30 and October 1, 2006. These special local regulations are necessary to provide for the safety of life on navigable waters during the event. This action is intended to restrict vessel traffic in portions of Sunset Lake during the event. DATES: Comments and related material must reach the Coast Guard on or before August 14, 2006. ADDRESSES: You may mail comments and related material to Commander (dpi), Fifth Coast Guard District, 431 Crawford Street, Portsmouth, Virginia 23704-5004, hand-deliver them to Room 415 at the same address between 9 a.m. and 2 p.m., Monday through Friday, except Federal holidays, or fax them to

(757)398-6203. The Inspections and Investigations Branch, Fifth Coast Guard District, maintains the public docket for this rulemaking. Comments and material received from the public, as well as documents indicated in this preamble as being available in the docket, will become part of this docket and will be available for inspection or copying at the above address between 9 a.m. and 2 p.m., Monday through Friday, except Federal holidays. FOR FURTHER INFORMATION CONTACT: Dennis Sens, Project Manager, Inspections and Investigations Branch, at

(757)398-6204. SUPPLEMENTARY INFORMATION: Request for Comments We encourage you to participate in this rulemaking by submitting comments and related material. If you do so, please include your name and address, identify the docket number for this rulemaking (CGD05-06-066), indicate the specific section of this document to which each comment applies, and give the reason for each comment. Please submit all comments and related material in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying. If you would like to know they reached us, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them. Public Meeting We do not now plan to hold a public meeting. But you may submit a request for a meeting by writing to the address listed under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the **Federal Register** . Background and Purpose Annually, the Sunset Lake Hydrofest Association sponsors the “Sunset Lake Hydrofest”, on the waters of Sunset Lake near Wildwood Crest, New Jersey. The event consists of approximately 100 inboard hydroplanes, Jersey speed skiffs and flat-bottom ski boats racing in heats counter-clockwise around an oval racecourse. A fleet of approximately 100 spectator vessels is anticipated to gather nearby to view the competition. Due to the need for vessel control during the event, vessel traffic will be temporarily restricted to provide for the safety of participants, spectators and transiting vessels. Discussion of Proposed Rule The Coast Guard proposes to establish this permanent special local regulation on specified waters of Sunset Lake. This rule would be enforced annually from 8:30 a.m. to 5:30 p.m. on the last weekend in September or the first weekend in October, and will restrict general navigation in the regulated area during the event. Determination of the weekend schedule for this event is dependent on tide cycles that will provide safe race conditions. The Coast Guard will publish a Notice of Enforcement in the **Federal Register** and in the Fifth Coast Guard District Local Notice to Mariners that announces the dates and times this rule is in effect. For 2006, the enforcement period of the regulation would be on September 30 and October 1, 2006. Except for participants and vessels authorized by the Coast Guard Patrol Commander, no person or vessel will be allowed to enter or remain in the regulated area. These regulations are needed to control vessel traffic during the event to enhance the safety of participants, spectators and transiting vessels. Regulatory Evaluation This proposed rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security (DHS). We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary. Although this proposed permanent rule will prevent traffic from transiting a portion of Sunset Lake during the event, the effect of this regulation would not be significant due to the limited duration that the regulated area will be in effect. Extensive advance notifications will be made to the maritime community via Local Notice to Mariners, marine information broadcasts, and area newspapers, so mariners can adjust their plans accordingly. Additionally, the proposed regulated area has been narrowly tailored to impose the least impact on general navigation yet provide the level of safety deemed necessary. Vessel traffic will be able to transit Sunset Lake by navigating around the regulated area. Small Entities Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities. This proposed rule would affect the following entities, some of which might be small entities: The owners or operators of vessels intending to transit or anchor in a portion of Sunset Lake during the event. This proposed rule would not have a significant economic impact on a substantial number of small entities for the following reasons. This proposed rule would be in effect for only a limited period. Vessel traffic could pass safely around the proposed regulated area. Before the enforcement period, we will issue maritime advisories so mariners can adjust their plans accordingly. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES ) explaining why you think it qualifies and how and to what degree this rule would economically affect it. Assistance for Small Entities Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. If the proposed rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the address listed under ADDRESSES . The Coast Guard will not retaliate against small entities that question or complain about this proposed rule or any policy or action of the Coast Guard. Collection of Information This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). Federalism A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble. Taking of Private Property This proposed rule would not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. Civil Justice Reform This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. Protection of Children We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children. Indian Tribal Governments This proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. Energy Effects We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211. Technical Standards The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies. This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards. Environment We have analyzed this proposed rule under Commandant Instruction M16475.lD, and Department of Homeland Security Management Directive 5100.1, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969

(NEPA)(42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, this rule is categorically excluded, under figure 2-1, paragraph (34)(h), of the Instruction, from further environmental documentation. Special local regulations issued in conjunction with a regatta or marine parade permit are specifically excluded from further analysis and documentation under that section. Under figure 2-1, paragraph (34)(h), of the Instruction, an “Environmental Analysis Check List” and a “Categorical Exclusion Determination” are not required for this rule. Comments on this section will be considered before we make the final decision on whether to categorically exclude this rule from further environmental review. List of Subjects in 33 CFR Part 100 Marine safety, Navigation (water), Reporting and recordkeeping requirements, Waterways. For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 100 as follows: PART 100—SAFETY OF LIFE ON NAVIGABLE WATERS 1. The authority citation for part 100 continues to read as follows: Authority: 33 U.S.C. 1233; Department of Homeland Security Delegation No. 0170.1. 2. Add § 100.535 to read as follows: § 100.535, Sunset Lake, Wildwood Crest, NJ.

(a)*Definitions:* The following definitions apply to this section;

(1)*Coast Guard Patrol Commander* means a commissioned, warrant, or petty officer of the Coast Guard who has been designated by the Commander, Coast Guard Sector Delaware Bay.

(2)*Official Patrol* means any vessel assigned or approved by Commander, Coast Guard Sector Delaware Bay with a commissioned, warrant, or petty officer on board and displaying a Coast Guard ensign.

(3)*Participant* includes all vessels participating in the Sunset Lake Hydrofest under the auspices of the Marine Event Permit issued to the event sponsor and approved by Commander, Coast Guard Sector Delaware Bay.

(b)*Regulated area:* Includes all waters of Sunset Lake, New Jersey, from shoreline to shoreline, south of latitude 38°58′32″ N. All coordinates reference Datum: NAD 1983.

(c)*Special local regulations:*

(1)Except for event participants and persons or vessels authorized by the Coast Guard Patrol Commander, no person or vessel may enter or remain in the regulated area.

(2)The operator of any vessel in the regulated area must:

(i)Stop the vessel immediately when directed to do so by any Official Patrol.

(ii)Proceed as directed by any Official Patrol.

(iii)When authorized to transit the regulated area, all vessels shall proceed at the minimum speed necessary to maintain a safe course that minimizes wake near the race course.

(d)*Enforcement period:* This section will be enforced annually from 8:30 a.m. to 5:30 p.m. on the last weekend in September or the first weekend in October. The Commander, Fifth Coast Guard District will publish a Notice of Enforcement in the **Federal Register** and in the Fifth Coast Guard District Local Notice to Mariners every year announcing the dates and times this section is in effect. In 2006 this section will be enforced from 8:30 a.m. on September 30, 2006 to 5:30 p.m. on October 1, 2006. Dated: June 29, 2006. Larry L. Hereth, Rear Admiral, U.S. Coast Guard, Commander, Fifth Coast Guard District. [FR Doc. E6-10975 Filed 7-12-06; 8:45 am] BILLING CODE 4910-15-P DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 100 [CGD05-06-069] RIN 1625-AA08 Special Local Regulations for Marine Events; Choptank River, Cambridge, MD AGENCY: Coast Guard, DHS. ACTION: Notice of proposed rulemaking. SUMMARY: The Coast Guard proposes to establish permanent special local regulations during the “Chesapeakeman Ultra Triathlon”, a marine event to be held annually on the last Saturday in September on the waters of the Choptank River at Cambridge, MD. For 2006 this marine event will be held on September 30, 2006. These special local regulations are necessary to provide for the safety of life on navigable waters during the event. This action is intended to temporarily restrict vessel traffic in a portion of the Choptank River during the Chesapeakeman Ultra Triathlon swim. DATES: Comments and related material must reach the Coast Guard on or before August 14, 2006. ADDRESSES: You may mail comments and related material to Commander (dpi), Fifth Coast Guard District, 431 Crawford Street, Portsmouth, Virginia 23704-5004, hand-deliver them to Room 416 at the same address between 9 a.m. and 2 p.m., Monday through Friday, except Federal holidays, or fax them to

(757)391-8149. The Inspections and Investigations Branch, Fifth Coast Guard District, maintains the public docket for this rulemaking. Comments and material received from the public, as well as documents indicated in this preamble as being available in the docket, will become part of this docket and will be available for inspection or copying at the above address between 9 a.m. and 2 p.m., Monday through Friday, except Federal holidays. FOR FURTHER INFORMATION CONTACT: Dennis Sens, Project Manager, Inspections and Investigations Branch, at

(757)398-6204. SUPPLEMENTARY INFORMATION: Request for Comments We encourage you to participate in this rulemaking by submitting comments and related material. If you do so, please include your name and address, identify the docket number for this rulemaking (CGD05-06-069), indicate the specific section of this document to which each comment applies, and give the reason for each comment. Please submit all comments and related material in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying. If you would like to know they reached us, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them. Public Meeting We do not now plan to hold a public meeting. But you may submit a request for a meeting by writing to the address listed under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the **Federal Register** . Background and Purpose Annually, the Columbia Triathlon Association sponsors the “Chesapeakeman Ultra Triathlon” on the waters of the Choptank River near Cambridge, Maryland. The swimming segment of the event will consist of approximately 300 swimmers competing across a 2.4-mile course along the Choptank River between the Hyatt Regency Chesapeake Bay Resort Beach and Great Marsh Park, Cambridge, Maryland. The competition will begin at the Hyatt Regency Beach. The participants will swim across to the finish line located at Great Marsh Park, swimming approximately 100 yards off shore, parallel with the shoreline. Approximately 20 support vessels will accompany the swimmers. Due to the need for vessel control during the swimming event, the Coast Guard will temporarily restrict vessel traffic in the event area to provide for the safety of participants, support craft and other transiting vessels. Discussion of Proposed Rule The Coast Guard proposes to establish permanent special local regulations on specified waters of the Choptank River between the beachfront adjacent to the Hyatt Regency Chesapeake Bay Resort and Great Marsh Park at Cambridge, Maryland. This rule would be enforced annually from 6:30 a.m. to 2:30 p.m. on the last Saturday in September. For 2006 this marine event will be held on September 30, 2006. The effect will be to restrict general navigation in the regulated area during the event. Except for persons or vessels authorized by the Coast Guard Patrol Commander, no person or vessel may enter or remain in the regulated area. Vessel traffic may be allowed to transit the regulated area at slow speed as the swim progresses, when the Coast Guard Patrol Commander determines it is safe to do so. The Patrol Commander will notify the public of specific enforcement times by Marine Radio Safety Broadcast. These regulations are needed to control vessel traffic during the event to enhance the safety of participants, spectators and transiting vessels. Regulatory Evaluation This proposed rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security (DHS). We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary. Although this proposed regulation will prevent traffic from transiting a segment of the Choptank River adjacent to Cambridge, MD during the event, the effect of this regulation will not be significant due to the limited duration that the regulated area will be in effect. Extensive advance notifications will be made to the maritime community via Local Notice to Mariners, marine information broadcasts, area newspapers and local radio stations, so mariners can adjust their plans accordingly. Vessel traffic will be able to transit the regulated area when the Coast Guard Patrol Commander deems it is safe to do so. Small Entities Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities. This proposed rule would affect the following entities, some of which might be small entities: The owners or operators of vessels intending to transit this section of the Choptank River during the event. This proposed rule would not have a significant economic impact on a substantial number of small entities for the following reasons. This proposed rule would be in effect for only a limited period, from 6:30 a.m. to 2:30 p.m. on the last Saturday in September. Vessels desiring to transit the event area will be able to transit the regulated area at slow speed as the swim progresses, when the Coast Guard Patrol Commander determines it is safe to do so. Before the enforcement period, we will issue maritime advisories so mariners can adjust their plans accordingly. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment ( *see* ADDRESSES ) explaining why you think it qualifies and how and to what degree this rule would economically affect it. Assistance for Small Entities Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the address listed under ADDRESSES . The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard. Collection of Information This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). Federalism A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble. Taking of Private Property This proposed rule would not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. Civil Justice Reform This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. Protection of Children We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children. Indian Tribal Governments This proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. Energy Effects We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211. Technical Standards The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( *e.g.* , specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies. This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards. Environment We have analyzed this proposed rule under Commandant Instruction M16475.lD and Department of Homeland Security Management Directive 5100.1, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969

(NEPA)(42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, this rule is categorically excluded, under figure 2-1, paragraph (34)(h), of the Instruction, from further environmental documentation. Special local regulations issued in conjunction with a regatta or marine parade permit are specifically excluded from further analysis and documentation under that section. Under figure 2-1, paragraph (34)(h), of the Instruction, an “Environmental Analysis Check List” and a “Categorical Exclusion Determination” are not required for this rule. Comments on this section will be considered before we make the final decision on whether to categorically exclude this rule from further environmental review. List of Subjects in 33 CFR Part 100 Marine safety, Navigation (water), Reporting and recordkeeping requirements, Waterways. For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 100 as follows: PART 100—SAFETY OF LIFE ON NAVIGABLE WATERS 1. The authority citation for part 100 continues to read as follows: Authority: 33 U.S.C. 1233; Department of Homeland Security Delegation No. 0170.1. 2. Section § 100.512 is revised to read as follows: § 100.512 Chesapeakeman Ultra Triathlon, Choptank River, Cambridge, MD.

(a)*Regulated area.* The regulated area includes all waters of the Choptank River within 200 yards either side of a line drawn northwesterly from a point on the shoreline at latitude 38°33′45″ N, 076°02′38″ W, thence to latitude 38°35′06″ N, 076°04′42″ W, a position located at Great Marsh Park, Cambridge, MD. All coordinates reference Datum NAD 1983.

(b)*Definitions.* The following definitions apply to this section;

(1)*Coast Guard Patrol Commander* means a commissioned, warrant, or petty officer of the Coast Guard who has been designated by the Commander, Coast Guard Sector Baltimore.

(2)*Official Patrol* means any vessel assigned or approved by Commander, Coast Guard Sector Baltimore with a commissioned, warrant, or petty officer on board and displaying a Coast Guard ensign.

(3)*Participant* includes all persons participating in the Chesapeakeman Ultra Triathlon swim under the auspices of the Marine Event Permit issued to the event sponsor and approved by Commander, Coast Guard Sector Baltimore.

(c)*Special local regulations.*

(1)Except for event participants and persons or vessels authorized by the Coast Guard Patrol Commander, no person or vessel may enter or remain in the regulated area.

(2)The operator of any vessel in the regulated area must:

(i)Stop the vessel immediately when directed to do so by any Official Patrol and then proceed only as directed.

(ii)All persons and vessels shall comply with the instructions of the Official Patrol.

(iii)When authorized to transit the regulated area, all vessels shall proceed at the minimum speed necessary to maintain a safe course that minimizes wake near the swim course.

(d)*Enforcement period.* This section will be enforced annually from 6:30 a.m. to 2:30 p.m. on the last Saturday in September. The Commander, Fifth Coast Guard District will publish a Notice of Enforcement in the **Federal Register** and in the Fifth Coast Guard District Local Notice to Mariners every year announcing the dates and times this section is in effect. In 2006 this section will be enforced from 6:30 a.m. to 2:30 p.m. on September 30, 2006. Dated: June 29, 2006. L.L. Hereth, Rear Admiral, U.S. Coast Guard, Commander, Fifth Coast Guard District. [FR Doc. E6-10976 Filed 7-12-06; 8:45 am] BILLING CODE 4910-15-P DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 100 [CGD05-06-065] RIN 1625-AA08 Special Local Regulations for Marine Events; Choptank River, Cambridge, MD AGENCY: Coast Guard, DHS. ACTION: Notice of proposed rulemaking. SUMMARY: The Coast Guard proposes to establish temporary special local regulations during the “Cambridge Offshore Challenge”, a marine event to be held over the waters of the Choptank River at Cambridge, Maryland. These special local regulations are necessary to provide for the safety of life on navigable waters during the event. This action is intended to restrict vessel traffic in the Choptank River during the event. DATES: Comments and related material must reach the Coast Guard on or before August 14, 2006. ADDRESSES: You may mail comments and related material to Commander (dpi), Fifth Coast Guard District, 431 Crawford Street, Portsmouth, Virginia 23704-5004, hand-deliver them to Room 416 at the same address between 9 a.m. and 2 p.m., Monday through Friday, except Federal holidays, or fax them to

(757)398-6204. SUPPLEMENTARY INFORMATION: Request for Comments We encourage you to participate in this rulemaking by submitting comments and related material. If you do so, please include your name and address, identify the docket number for this rulemaking (CGD05-06-065), indicate the specific section of this document to which each comment applies, and give the reason for each comment. Please submit all comments and related material in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying. If you would like to know they reached us, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them. Public Meeting We do not now plan to hold a public meeting. But you may submit a request for a meeting by writing to the address listed under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the **Federal Register** . Background and Purpose On September 23 and 24, 2006, the Chesapeake Bay Powerboat Association will sponsor the “2006 Cambridge Offshore Challenge”, on the waters of the Choptank River at Cambridge, Maryland. The event will consist of approximately 40 offshore powerboats conducting high-speed competitive races between the Route 50 Bridge and Oystershell Point, MD. A fleet of approximately 250 spectator vessels is expected to gather nearby to view the competition. Due to the need for vessel control during the event, vessel traffic will be temporarily restricted to provide for the safety of participants, spectators and transiting vessels. Discussion of Proposed Rule The Coast Guard proposes to establish temporary special local regulations on specified waters of the Choptank River. The temporary special local regulations will be enforced from 10:30 a.m. to 4:30 p.m. on September 23 and 24, 2006, and will restrict general navigation in the regulated area during the event. Except for participants and vessels authorized by the Coast Guard Patrol Commander, no person or vessel will be allowed to enter or remain in the regulated area. These regulations are needed to control vessel traffic during the event to enhance the safety of participants, spectators and transiting vessels. Regulatory Evaluation This proposed rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security (DHS). We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary. Although this proposed regulation will prevent traffic from transiting a portion of the Choptank River during the event, the effect of this regulation will not be significant due to the limited duration that the regulated area will be in effect. Extensive advance notifications will be made to the maritime community via Local Notice to Mariners, marine information broadcasts, and area newspapers, so mariners can adjust their plans accordingly. Additionally, the proposed regulated area has been narrowly tailored to impose the least impact on general navigation yet provide the level of safety deemed necessary. Vessel traffic will be able to transit the regulated area between heats, when the Coast Guard Patrol Commander deems it is safe to do so. Small Entities Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities. This proposed rule would affect the following entities, some of which might be small entities: The owners or operators of vessels intending to transit or anchor in a portion of the Choptank River during the event. This proposed rule would not have a significant economic impact on a substantial number of small entities for the following reasons. This proposed rule would be in effect for only a limited period. Vessel traffic will be able to transit the regulated area between heats, when the Coast Guard Patrol Commander deems it is safe to do so. Before the enforcement period, we will issue maritime advisories so mariners can adjust their plans accordingly. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES ) explaining why you think it qualifies and how and to what degree this rule would economically affect it. Assistance for Small Entities Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the address listed under ADDRESSES . The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard. Collection of Information This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). Federalism A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble. Taking of Private Property This proposed rule would not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. Civil Justice Reform This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. Protection of Children We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children. Indian Tribal Governments This proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. Energy Effects We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211. Technical Standards The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies. This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards. Environment We have analyzed this proposed rule under Commandant Instruction M16475.lD, and Department of Homeland Security Management Directive 5100.1, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969

(NEPA)(42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, this rule is categorically excluded, under figure 2-1, paragraph (34)(h), of the Instruction, from further environmental documentation. Special local regulations issued in conjunction with a regatta or marine parade permit are specifically excluded from further analysis and documentation under that section. Under figure 2-1, paragraph (34)(h), of the Instruction, an “Environmental Analysis Check List” and a “Categorical Exclusion Determination” are not required for this rule. Comments on this section will be considered before we make the final decision on whether to categorically exclude this rule from further environmental review. List of Subjects in 33 CFR Part 100 Marine safety, Navigation (water), Reporting and recordkeeping requirements, Waterways. For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 100 as follows: PART 100—SAFETY OF LIFE ON NAVIGABLE WATERS 1. The authority citation for part 100 continues to read as follows: Authority: 33 U.S.C. 1233; Department of Homeland Security Delegation No. 0170.1. 2. Add a temporary § 100.35-T05-065 to read as follows: § 100.35-T05-065 Choptank River, Cambridge, MD.

(a)*Definitions:* The following definitions apply to this section:

(1)*Coast Guard Patrol Commander* means a commissioned, warrant, or petty officer of the Coast Guard who has been designated by the Commander, Coast Guard Sector Baltimore.

(2)*Official Patrol* means any vessel assigned or approved by Commander, Coast Guard Sector Baltimore with a commissioned, warrant, or petty officer on board and displaying a Coast Guard ensign.

(3)*Participant* includes all vessels participating in the 2006 Cambridge Offshore Challenge under the auspices of the Marine Event Permit issued to the event sponsor and approved by Commander, Coast Guard Sector Baltimore.

(b)*Regulated area:* A regulated area is established for all waters of the Choptank River, from shoreline to shoreline, bounded to the west by the Route 50 Bridge and bounded to the east by a line drawn along longitude 076° W, between Goose Point, MD and Oystershell Point, MD. All coordinates reference Datum: NAD 1983.

(c)*Special local regulations:*

(1)Except for event participants and persons or vessels authorized by the Coast Guard Patrol Commander, no person or vessel may enter or remain in the regulated area.

(2)The operator of any vessel in the regulated area must:

(i)Stop the vessel immediately when directed to do so by any Official Patrol.

(ii)Proceed as directed by any Official Patrol.

(iii)When authorized to transit the regulated area, all vessels shall proceed at the minimum speed necessary to maintain a safe course that minimizes wake near the race course.

(d)*Enforcement period.* This section will be enforced from 10:30 a.m. on September 23, 2006 to 4:30 p.m. on September 24, 2006. Dated: June 29, 2006. L.L. Hereth, Rear Admiral, U.S. Coast Guard, Commander, Fifth Coast Guard District. [FR Doc. E6-10982 Filed 7-12-06; 8:45 am] BILLING CODE 4910-15-P DEPARTMENT OF VETERANS AFFAIRS 38 CFR Part 3 RIN 2900-AM37 Home Schooling and Educational Institution AGENCY: Department of Veterans Affairs. ACTION: Proposed rule. SUMMARY: The Department of Veterans Affairs

(VA)proposes to amend its adjudication regulation regarding the definition of a child for purposes of establishing entitlement to additional monetary benefits for a child who is home-schooled. VA proposes to define educational institutions to include home-school programs that meet the legal requirements of the States (by complying with the compulsory attendance laws of the States) in which they are located. DATES: Comments must be received by VA on or before September 11, 2006. ADDRESSES: Written comments may be submitted by: mail or hand-delivery to the Director, Regulations Management (00REG1), Department of Veterans Affairs, 810 Vermont Ave., NW., Room 1068, Washington, DC 20420; fax to

(202)273-9026; or, through *http://www.Regulations.gov.* Comments should indicate that they are submitted in response to “RIN 2900-AM37.” All comments received will be available for public inspection in the Office of Regulation Policy and Management, Room 1063B, between the hours of 8 a.m. and 4:30 p.m. Monday through Friday (except holidays). Please call

(202)273-9515 for an appointment. FOR FURTHER INFORMATION CONTACT: Maya Ferrandino, Regulations Staff, Compensation and Pension Service, Veterans Benefits Administration, Department of Veterans Affairs, 810 Vermont Avenue, NW., Washington, DC 20420,

(202)273-7210. SUPPLEMENTARY INFORMATION: A veteran who is entitled to compensation under the provisions of 38 U.S.C. 1114 or 1134 is also entitled, under certain circumstances, to additional compensation for dependents, including a child. A veteran who is entitled to pension under the provisions of 38 U.S.C. 1521 also is entitled to a higher annual rate of pension because of his or her dependents, including a child. Additional dependency and indemnity compensation and death pension may also be payable based on the number of the surviving spouse's dependent children. In addition, under certain circumstances, a deceased veteran's children may be entitled to these benefits in their own right. A child is defined in 38 U.S.C. 101(4)(A)(iii) to include a person who is unmarried, and, after attaining the age of eighteen years and until completion of education or training (but not after attaining the age of twenty-three years), is pursuing a course of instruction at an approved educational institution. The implementing regulation is at 38 CFR 3.57(a)(1)(iii). Section 104(a) of title 38, United States Code, provides that, for the purpose of determining whether benefits are payable (except those under chapter 35, title 38, United States Code) for a child over age eighteen and under the age of twenty-three years who is attending a school, college, academy, seminary, technical institute, university or other educational institution, the Secretary may approve or disapprove such educational institutions. In a precedent opinion dated March 19, 1998 (VAOPGCPREC 3-98), VA's General Counsel interpreted the term “educational institution” to include only institutions that are similar in type to the institutions specifically enumerated in 38 U.S.C. 104(a). The General Counsel discussed the definition of “institution” and additionally concluded that a person who is receiving instruction in a home-school program is not pursuing a course of instruction at an educational institution and therefore does not qualify as a child within the meaning of 38 U.S.C. 101(4)(A)(iii). On March 8, 2000, VA published a final rule amending 38 CFR 3.57(a)(1)(iii) to provide a definition of education institution, and specifically excluded home-school programs from the scope of the term “educational institution.” In publishing the amendment as a final rule rather than going through notice and comment under the Administrative Procedure Act, VA stated that the rule interpreted statutory provisions and made non-substantive changes. In *Theiss* v. *Principi* , 18 Vet. App. 204 (2004), the United States Court of Appeals for Veterans Claims (Court) invalidated VAOPGCPREC 3-98 and the March 8, 2000 rulemaking that excluded home-school programs from the definition of “educational institution.” Although the holding in *Theiss* was based on the Veterans Court's disagreement with VA's decision to publish the amendment to § 3.57(a)(1)(iii) as a final rule without first inviting public comment, the Court also discussed the underlying validity of the rule's exclusion of home-school programs. The Court raised concerns regarding the basis for the General Counsel's interpretation of “educational institution” in VAOPGCPREC 3-98 and the focus in that precedent opinion on the characteristics that differentiated a home-school program from the specifically enumerated educational institutions found in section 104(a) of title 38. According to the Court, home schooling has important aspects in common with the enumerated programs in section 104(a): “They are all educational programs; they all have instructors and instructional material; and they all involve some form of accreditation.” 18 Vet. App. at 211. We propose to amend 38 CFR 3.57 to define educational institution, and to include home-school programs as educational institutions. We propose that the definition will apply to this section and to 38 CFR 3.667, School attendance, which is a corresponding regulation regarding effective dates for awards based on a child's school attendance. The Court in *Theiss* discussed various dictionary definitions for the term “educational institution.” “Educational institution” has been defined as “[a] school, seminary, college, university, or other educational facility.” It is also defined as “[a]n institution for the teaching and improvement of its students or pupils; a school, seminary, college, or university * * * Art galleries, museums, public libraries, even labor union buildings have at times been held to be educational institutions.” A “facility” is defined as “a building, special room, etc. that facilitates or makes possible some activity.” The Court also noted that “institution” has been variously defined as: an established organization or corporation (as a college or university) especially of a public character; something that has been established, particularly a place where an educational or charitable enterprise is conducted; and an “establishment * * *devoted to the promotion of a particular object.” The Court noted that certain dictionaries define “establishment” to include “a household”, and define “organization” to include a group of persons organized for a particular purpose. The Court noted that the word “organization” has also been defined to refer to a group of people with more or less constant membership. The Court cited Ballentine's Law Dictionary at 390 (3rd Ed. 1969), Black's Law Dictionary 546 (6th Ed. 1990), Black's Law Dictionary at 532 (7th Ed. 1999), Webster's Third New International Dictionary 1590 (1976), Webster's Ninth New Collegiate Dictionary 627 (1990), The American Heritage Dictionary of The English Language at 936, 1275 (3rd Edition), and The Random House Dictionary of the English Language at 737 (1967), as support for these definitions. *Theiss* , 18 Vet. App. 209-211. The references in the various definitions to “establishments” and “established organizations” and to examples such as schools, colleges, and universities suggest that educational institutions are most commonly characterized by a degree of permanence in time and location and by the provision of education to a group of individuals. As suggested in *Theiss* , however, it also may be reasonable to construe the term “educational institution” to include some programs, such as home-school programs, that do not meet those general standards of permanence or numerosity, but which are established in accordance with State law for the specific purpose of providing educational instruction. We believe it is appropriate that home schools that operate in compliance with the compulsory attendance laws of the States in which they are located, whether treated as private schools or home schools under State law, constitute “educational institutions”. Accordingly, we propose to establish a two-part definition of “educational institution.” First, we propose to state that the term “educational institution” means “a permanent organization that offers courses of instruction to a group of students who meet its enrollment criteria, including schools, colleges, academies, seminaries, technical institutes, and universities.” Second, we propose to state that the term “also includes home schools that operate in compliance with the compulsory attendance laws of the States in which they are located, whether treated as private schools or home schools under State law.” Third, in order to clarify that home schools are distinct entities from post-secondary institutions, such as colleges and universities, we propose to state that the term “home schools” is limited to courses of instruction for grades kindergarten through 12. Lastly, we note that 38 CFR part 3 does not include a regulation describing VA's criteria for approving educational institutions. We plan to promulgate such a rule in the near future and allow notice and comment in accordance with the Administrative Procedures Act. Paperwork Reduction Act All collections of information under the Paperwork Reduction Act (44 U.S.C. 3501-3521) referenced in this proposed rule has an existing OMB approval as a form. The form is VA Form 21-674, Request for Approval of School Attendance, OMB approval number 2900-0049. No changes are made in this proposed rule to the collection of information. Regulatory Flexibility Act The Secretary hereby certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This proposed rule would not affect any small entities. Therefore, pursuant to 5 U.S.C. 605(b), this proposed rule is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604. Executive Order 12866 Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). The Order classifies a rule as a significant regulatory action requiring review by the Office of Management and Budget if it meets any one of a number of specified conditions, including: having an annual effect on the economy of $100 million or more, creating a serious inconsistency or interfering with an action of another agency, materially altering the budgetary impact of entitlements or the rights of entitlement recipients, or raising novel legal or policy issues. VA has examined the economic, legal, and policy implications of this proposed rule and has concluded that it is a significant regulatory action because it raises novel policy issues. Unfunded Mandates The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This proposed rule would have no such effect on State, local, and tribal governments, or on the private sector. Catalog of Federal Domestic Assistance Numbers The Catalog of Federal Domestic Assistance program numbers and titles for this proposal are 64.104 Pension for Non-Service-Connected Disability for Veterans, 64.105 Pension to Veterans Surviving Spouses, and Children, 64.109 Veterans Compensation for Service-Connected Disability, and 64.110 Veterans Dependency and Indemnity Compensation for Service-Connected Death. List of Subjects in 38 CFR Part 3 Administrative practice and procedure, Claims, Disability benefits, Health care, Pensions, Radioactive materials, Veterans, Vietnam. Approved: March 17, 2006. Gordon H. Mansfield, Deputy Secretary of Veterans Affairs. For the reasons set out in the preamble, VA proposes to amend 38 CFR part 3 as follows: PART 3—ADJUDICATION 1. The authority citation for part 3, subpart A continues to read as follows: Authority: 38 U.S.C. 501(a), unless otherwise noted. 2. Revise § 3.57(a)(1)(iii) to read as follows: § 3.57 Child.

(a)* * *

(1)* * *

(iii)Who, after reaching the age of 18 years and until completion of education or training (but not after reaching the age of 23 years) is pursuing a course of instruction at an educational institution approved by the Department of Veterans Affairs. For the purposes of this section and § 3.667, the term “educational institution” means a permanent organization that offers courses of instruction to a group of students who meet its enrollment criteria, including schools, colleges, academies, seminaries, technical institutes, and universities. The term also includes home schools that operate in compliance with the compulsory attendance laws of the States in which they are located, whether treated as private schools or home schools under State law. The term “home schools” is limited to courses of instruction for grades kindergarten through 12. (Authority: 38 U.S.C. 101(4)(A), 104(a)) [FR Doc. E6-10969 Filed 7-12-06; 8:45 am] BILLING CODE 8320-01-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 52 and 81 [EPA-R03-OAR-2006-0485; FRL-8196-7] Approval and Promulgation of Air Quality Implementation Plans; West Virginia; Redesignation of the Huntington, WV Portion of the Huntington-Ashland 8-Hour Ozone Nonattainment Area to Attainment and Approval of the Maintenance Plan AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule. SUMMARY: EPA is proposing to approve a redesignation request and a State Implementation Plan

(SIP)revision for the Huntington portion of the Huntington-Ashland, WV-KY (herein referred to as the “Huntington-Ashland area”) interstate area from nonattainment to attainment of the 8-hour ozone National Ambient Air Quality Standard (NAAQS). The West Virginia Department of Environmental Protection (WVDEP) is requesting that the Cabell and Wayne County, West Virginia (Huntington) portion of the Huntington-Ashland area be redesignated as attainment for the 8-hour ozone NAAQS. The interstate Huntington-Ashland 8-hour ozone nonattainment area is comprised of three counties (Cabell and Wayne Counties, West Virginia and Boyd County, Kentucky). EPA is proposing to approve the ozone redesignation request for the Huntington portion of the Huntington-Ashland area. In conjunction with its redesignation request, the WVDEP submitted a SIP revision consisting of a maintenance plan for Huntington that provides for continued attainment of the 8-hour ozone NAAQS for the next 12 years. EPA is proposing to make a determination that Huntington has attained the 8-hour ozone NAAQS based upon three years of complete, quality-assured ambient air quality ozone monitoring data for 2003-2005. EPA's proposed approval of the 8-hour ozone redesignation request is based on its determination that Huntington has met the criteria for redesignation to attainment specified in the Clean Air Act (CAA). EPA is providing information on the status of its adequacy determination for the motor vehicle emission budgets (MVEBs) that are identified in the Huntington maintenance plan for purposes of transportation conformity, and is also proposing to approve those MVEBs. EPA is proposing approval of the redesignation request and of the maintenance plan revision to the West Virginia SIP in accordance with the requirements of the CAA. DATES: Written comments must be received on or before August 14, 2006. ADDRESSES: Submit your comments, identified by Docket ID Number EPA-R03-OAR-2006-0485 by one of the following methods: A. Federal eRulemaking Portal: *http://www.regulations.gov.* Follow the on-line instructions for submitting comments. B. E-mail: *morris.makeba@epa.gov.* C. Mail: EPAR03-OAR-2006-0485, Makeba Morris, Chief, Air Quality Planning Branch, D. Mailcode 3AP21, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. E. Hand Delivery: At the previously-listed EPA Region III address. Such deliveries are only accepted during the Docket's normal hours of operation, and special arrangements should be made for deliveries of boxed information. *Instructions:* Direct your comments to Docket ID No. EPA-R03-OAR-2006-0485. EPA's policy is that all comments received will be included in the public docket without change, and may be made available online at *http://www.epa.gov/edocket www.regulations.gov,* including any personal information provided, unless the comment includes information claimed to be Confidential Business Information

(CBI)or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through *http://www.regulations.gov* or e-mail. The *http://www.regulations.gov* Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through *http://www.regulations.gov* , your e-mail address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. *Docket:* All documents in the electronic docket are listed in the *http://www.regulations.gov* index. Although listed in the index, some information is not publicly available, *i.e.* , CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically in *http://www.regulations.gov* or in hard copy during normal business hours at the Air Protection Division, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. Copies of the State submittal are available at the West Virginia Department of Environmental Protection, Division of Air Quality, 601 57th Street SE, Charleston, WV 25304. FOR FURTHER INFORMATION CONTACT: Amy Caprio,

(215)814-2156, or by e-mail at *caprio.amy@epa.gov.* SUPPLEMENTARY INFORMATION: Throughout this document whenever “we”, “us”, or “our” is used, we mean EPA. Table of Contents I. What Actions Is EPA Proposing To Take? II. What Is the Background for These Proposed Actions? III. What Are the Criteria for Redesignation to Attainment? IV. Why Is EPA Taking These Actions? V. What Would Be the Effect of These Actions? VI. What Is EPA's Analysis of the State's Request? VII. Are the Motor Vehicle Emissions Budgets Established and Identified in the Huntington Maintenance Plan Adequate and Approvable? VIII. Proposed Action IX. Statutory and Executive Order Reviews 1. What Actions Is EPA Proposing To Take? On May 17, 2006, WVDEP formally submitted a request to redesignate Huntington from nonattainment to attainment of the 8-hour NAAQS for ozone. On May 17, 2006, West Virginia submitted a maintenance plan for Huntington as a SIP revision, to ensure continued attainment over the next 12 years. Huntington is comprised of Cabell and Wayne Counties. Huntington is currently designated as a basic 8-hour ozone nonattainment area. EPA is proposing to determine that Huntington has attained the 8-hour ozone NAAQS and that it has met the requirements for redesignation pursuant to section 107(d)(3)(E) of the CAA. EPA is, therefore, proposing to approve the redesignation request to change the designation of Huntington from nonattainment to attainment for the 8-hour ozone NAAQS. EPA is also proposing to approve the maintenance plan SIP revision for Huntington, such approval being one of the CAA requirements for approval of a redesignation request. The maintenance plan is designed to ensure continued attainment throughout the Huntington-Ashland area for the next 12 years. Additionally, EPA is announcing its action on the adequacy process for the MVEBs identified in the Huntington maintenance plan, and proposing to approve the MVEBs identified for volatile organic compounds

(VOC)and nitrogen oxides (NO X ) for transportation conformity purposes. These MVEBs are State MVEBs for the West Virginia portion of the Huntington-Ashland 8-hour ozone area. In a separate submittal, the Commonwealth of Kentucky is establishing MVEBs for the remainder of this area ( *i.e.* , Boyd County). Concurrently, the State is requesting that EPA approve the maintenance plan as meeting the requirements of CAA 175A(b) with respect to the 1-hour ozone maintenance plan update. II. What Is the Background for These Proposed Actions? A. General Ground-level ozone is not emitted directly by sources. Rather, emissions of NO X and VOC react in the presence of sunlight to form ground-level ozone. The air pollutants NO X and VOC are referred to as precursors of ozone. The CAA establishes a process for air quality management through the attainment and maintenance of the NAAQS. On July 18, 1997, EPA promulgated a revised 8-hour ozone standard of 0.08 parts per million (ppm). This new standard is more stringent than the previous 1-hour ozone standard. EPA designated, as nonattainment, any area violating the 8-hour ozone NAAQS based on the air quality data for the three years of 2001-2003. These were the most recent three years of data at the time EPA designated 8-hour areas. The Huntington-Ashland area was designated as basic 8-hour ozone nonattainment status in a **Federal Register** notice signed on April 25, 2004 and published on April 30, 2004 (69 FR 23857). On June 15, 2005 (69 FR at 23396), the 1-hour ozone NAAQS was revoked in the Huntington-Ashland area (as well as most other areas of the country). See 40 CFR 50.9(b); 69 FR at 23396 (April 30, 2004); and see 70 FR 44470 (August 3, 2005). The CAA, Title I, Part D, contains two sets of provisions—subpart 1 and subpart 2—that address planning and control requirements for nonattainment areas. Subpart 1 (which EPA refers to as “basic” nonattainment) contains general, less prescriptive requirements for nonattainment areas for any pollutant—including ozone—governed by a NAAQS. Subpart 2 (which EPA refers to as “classified” nonattainment) provides more specific requirements for ozone nonattainment areas. Some 8-hour ozone nonattainment areas are subject only to the provisions of subpart 1. Other areas are also subject to the provisions of subpart 2. Under EPA's 8-hour ozone implementation rule, signed on April 15, 2004, an area was classified under subpart 2 based on its 8-hour ozone design value ( *i.e.* , the 3-year average annual fourth-highest daily maximum 8-hour average ozone concentration), if it had a 1-hour design value at or above 0.121 ppm (the lowest 1-hour design value in the CAA for subpart 2 requirements). All other areas are covered under subpart 1, based upon their 8-hour design values. In 2004, the Huntington-Ashland area was designated a basic 8-hour ozone nonattainment area based upon air quality monitoring data from 2001-2003, and is subject to the requirements of subpart 1. Under 40 CFR part 50, the 8-hour ozone standard is attained when the 3-year average of the annual fourth-highest daily maximum 8-hour average ambient air quality ozone concentrations is less than or equal to 0.08 ppm ( *i.e.* , 0.084 ppm when rounding is considered). See 69 FR 23857 (April 30, 2004) for further information. Ambient air quality monitoring data for the 3-year period must meet data completeness requirements. The data completeness requirements are met when the average percent of days with valid ambient monitoring data is greater than 90 percent, and no single year has less than 75 percent data completeness as determined in Appendix I of 40 CFR part 50. The ozone monitoring data indicates that Huntington has a design value of 0.081 ppm for the 3-year period of 2002-2004 and a design value of design value of 0.076 ppm for the 3-year period of 2003-2005. The ozone monitoring data from the 3-year period of 2003-2005 indicates that Ashland has a design value of 0.079 ppm. Therefore, the ambient ozone data for the Huntington-Ashland area indicates no violations of the 8-hour ozone standard. Final monitoring data for 2005 indicates continued attainment of the 8-hour ozone standard in the Huntington-Ashland area. B. The Huntington-Ashland Area The Huntington-Ashland area consists of Cabell and Wayne Counties, West Virginia and Boyd County, Kentucky. Prior to its designation as an 8-hour ozone nonattainment area, the Huntington-Ashland area was a maintenance area for the 1-hour ozone nonattainment NAAQS. See 59 FR 65719 (December 21, 1994). On May 17, 2006, the WVDEP requested that Huntington be redesignated to attainment for the 8-hour ozone standard. The redesignation request included 3 years of complete, quality-assured data for the period of 2002-2004, indicating that the 8-hour NAAQS for ozone had been achieved in Huntington. The data satisfies the CAA requirements when the 3-year average of the annual fourth-highest daily maximum 8-hour average ozone concentration (commonly referred to as the area's design value) is less than or equal to 0.08 ppm ( *i.e.* , 0.084 ppm when rounding is considered). Under the CAA, a nonattainment area may be redesignated if sufficient complete, quality-assured data is available to determine that the area has attained the standard and the area meets the other CAA redesignation requirements set forth in section 107(d)(3)(E). III. What Are the Criteria for Redesignation to Attainment? The CAA provides the requirements for redesignating a nonattainment area to attainment. Specifically, section 107(d)(3)(E) of the CAA, allows for redesignation, providing that:

(1)EPA determines that the area has attained the applicable NAAQS;

(2)EPA has fully approved the applicable implementation plan for the area under section 110(k);

(3)EPA determines that the improvement in air quality is due to permanent and enforceable reductions in emissions resulting from implementation of the applicable SIP and applicable Federal air pollutant control regulations and other permanent and enforceable reductions;

(4)EPA has fully approved a maintenance plan for the area as meeting the requirements of section 175A; and

(5)The State containing such area has met all requirements applicable to the area under section 110 and Part D. EPA provided guidance on redesignation in the General Preamble for the Implementation of Title I of the CAA Amendments of 1990, on April 16, 1992 (57 FR 13498), and supplemented this guidance on April 28, 1992 (57 FR 18070). EPA has provided further guidance on processing redesignation requests in the following documents: • “Ozone and Carbon Monoxide Design Value Calculations”, Memorandum from Bill Laxton, June 18, 1990; • “Maintenance Plans for Redesignation of Ozone and Carbon Monoxide Nonattainment Areas,” Memorandum from G.T. Helms, Chief, Ozone/Carbon Monoxide Programs Branch, April 30, 1992; • “Contingency Measures for Ozone and Carbon Monoxide

(CO)Redesignations,” Memorandum from G. T. Helms, Chief, Ozone/Carbon Monoxide Programs Branch, June 1, 1992; • “Procedures for Processing Requests to Redesignate Areas to Attainment,” Memorandum from John Calcagni, Director, Air Quality Management Division, September 4, 1992; • “State Implementation Plan

(SIP)Actions Submitted in Response to Clean Air Act

(Act)Deadlines,” Memorandum from John Calcagni Director, Air Quality Management Division, October 28, 1992; • “Technical Support Documents (TSD's) for Redesignation Ozone and Carbon Monoxide

(CO)Nonattainment Areas,” Memorandum from G.T. Helms, Chief, Ozone/Carbon Monoxide Programs Branch, August 17, 1993; • “State Implementation Plan

(SIP)Requirements for Areas Submitting Requests for Redesignation to Attainment of the Ozone and Carbon Monoxide

(CO)National Ambient Air Quality Standards (NAAQS) On or After November 15, 1992,” Memorandum from Michael H. Shapiro, Acting Assistant Administrator for Air and Radiation, September 17, 1993; • Memorandum from D. Kent Berry, Acting Director, Air Quality Management Division, to Air Division Directors, Regions 1-10, “Use of Actual Emissions in Maintenance Demonstrations for Ozone and CO Nonattainment Areas,” dated November 30, 1993; • “Part D New Source Review (Part D NSR) Requirements for Areas Requesting Redesignation to Attainment,” Memorandum from Mary D. Nichols, Assistant Administrator for Air and Radiation, October 14, 1994; and • “Reasonable Further Progress, Attainment Demonstration, and Related Requirements for Ozone Nonattainment Areas Meeting the Ozone National Ambient Air Quality Standard,” Memorandum from John S. Seitz, Director, Office of Air Quality Planning and Standards, May 10, 1995. IV. Why Is EPA Taking These Actions? On May 17, 2006, the WVDEP requested redesignation of Huntington to attainment for the 8-hour ozone standard. On May 17, 2006, the WVDEP submitted a maintenance plan for Huntington as a SIP revision, to assure continued attainment over the next 12 years, until 2018. Concurrently, West Virginia is requesting that EPA approve the maintenance plan as meeting the requirements of CAA 175A(b) with respect to the 1-hour ozone maintenance plan update. EPA is proposing to approve the maintenance plan to fulfill the requirement of section 175A(b) for submission of a maintenance plan update eight years after Huntington was redesignated to attainment of the 1-hour ozone NAAQS. EPA believes that such an update must ensure that the maintenance plan in the SIP provides maintenance of the NAAQS for a period of 20 years after an area is initially redesignated to attainment. EPA can propose approval because the maintenance plan, which demonstrates maintenance of the 8-hour ozone NAAQS through 2018, also demonstrates maintenance of the 1-hour ozone NAAQS through 2018, even though the latter standard is no longer in effect. Huntington was redesignated to attainment of the 1-hour ozone NAAQS on December 21, 1994 (59 FR 45985), and, the initial 1-hour ozone maintenance plan provided for maintenance through 2005. Ashland was redesignated to attainment of the 1-hour ozone NAAQS on June 29, 1995 (60 FR 33748). Section 51.905(e) of the “Final Rule To Implement the 8-Hour Requirements—Phase 1” April 30, 2004 (69 FR 23999) specifies the conditions that must be satisfied before EPA may approve a modification to a 1-hour maintenance plan which:

(1)Removes the obligation to submit a maintenance plan for the 1-hour ozone NAAQS eight years after approval of the initial 1-hour maintenance plan and/or

(2)removes the obligation to implement contingency measures upon a violation of the 1-hour NAAQS. EPA believes that section 51.905(e) of the final rule allows a State to make either one or both of these modifications to a 1-hour maintenance plan SIP once EPA approves a maintenance plan for the 8-hour NAAQS. The maintenance plan will not trigger the contingency plan upon a violation of the 1-hour ozone NAAQS, but upon a violation of the 8-hour ozone NAAQS. EPA believes that the 8-hour standard is now the proper standard which should trigger the contingency plan now that the 1-hour NAAQS has been revoked and now that approval of the maintenance plan would allow the State to remove a violation of the 1-hour NAAQS obligation from the SIP. EPA has determined that Huntington has attained the standard and has met the requirements for redesignation set forth in section 107(d)(3)(E). V. What Would Be the Effect of These Actions? Approval of the redesignation request would change the designation of Huntington from nonattainment to attainment for the 8-hour ozone NAAQS found at 40 CFR part 81. It would also incorporate into the West Virginia SIP a maintenance plan ensuring continued attainment of the 8-hour ozone NAAQS in Huntington for the next 12 years, until 2018. The maintenance plan includes contingency measures to remedy any future violations of the 8-hour NAAQS (should they occur), and identifies the MVEBs for NO X and VOC for transportation conformity purposes for the years 2004, 2009 and 2018. These MVEBs are displayed in the following table: Table 1.—Motor Vehicle Emissions Budgets in Tons per Day

(tpd)Year NO X VOC 2004 11.5 6.0 2009 8.7 4.6 2018 4.1 3.0 VI. What Is EPA's Analysis of the State's Request? EPA is proposing to determine that the Huntington-Ashland area has attained the 8-hour ozone standard and that all other redesignation criteria have been met. The following is a description of how the WVDEP's May 17, 2006 submittal satisfies the requirements of section 107(d)(3)(E) of the CAA. A. The Huntington-Ashland Area Has Attained the 8-Hour Ozone NAAQS EPA is proposing to determine that the Huntington-Ashland area has attained the 8-hour ozone NAAQS. For ozone, an area may be considered to be attaining the 8-hour ozone NAAQS if there are no violations, as determined in accordance with 40 CFR 50.10 and Appendix I of part 50, based on three complete, consecutive calendar years of quality-assured air quality monitoring data. To attain this standard, the 3-year average of the fourth-highest daily maximum 8-hour average ozone concentrations measured at each monitor, within the area, over each year must not exceed the ozone standard of 0.08 ppm. Based on the rounding convention described in 40 CFR part 50, Appendix I, the standard is attained if the design value is 0.084 ppm or below. The data must be collected and quality-assured in accordance with 40 CFR part 58, and recorded in the Aerometric Information Retrieval System (AIRS). The monitors generally should have remained at the same location for the duration of the monitoring period required for demonstrating attainment. In the Huntington-Ashland area there is one ozone monitor, located in Cabell County, West Virginia and one ozone monitor in Boyd County, Kentucky that measure air quality with respect to ozone. As part of its redesignation request, West Virginia submitted ozone monitoring data for the years 2002-2005 for the Huntington-Ashland area. This data has been quality assured and is recorded in AIRS. The fourth high 8-hour daily maximum concentrations, along with the three-year averages, are summarized in Tables 2 and 3. Table 2.—Huntington's Fourth Highest 8-Hour Average Values; Cabell Monitor, AIRS ID 54-011-0006 Year Annual 4th high reading

(ppm)2002 0.097 2003 0.080 2004 0.066 2005 0.082 The average for the 3-year period 2002 through 2004 is 0.081 ppm. The average for the 3-year period 2003 through 2005 is 0.076 ppm. Table 3.—Ashland's Fourth Highest 8-Hour Average Values; Boyd Monitor, AIRS ID 21-019-0017 Year Annual 4th high reading

(ppm)2002 0.102 2003 0.088 2004 0.068 2005 0.082 The average for the 3-year period 2002 through 2004 is 0.086 ppm. The average for the 3-year period 2003 through 2005 is 0.079 ppm. The air quality data for 2003-2005 show that the entire Huntington-Ashland area has attained the standard with a design value of 0.076 ppm for Huntington and a design value of 0.079 ppm for Ashland. The data collected at the Huntington-Ashland area monitors satisfy the CAA requirement that the 3-year average of the annual fourth-highest daily maximum 8-hour average ozone concentration is less than or equal to 0.08 ppm. The WVDEP's request for redesignation for Huntington indicates that the data was quality assured in accordance with 40 CFR part 58. The WVDEP uses AIRS as the permanent database to maintain its data and quality assures the data transfers and content for accuracy. In addition, as discussed below with respect to the maintenance plan, WVDEP has committed to continue monitoring in accordance with 40 CFR part 58. In summary, EPA has determined that the data submitted by West Virginia and data taken from AIRS indicates that the Huntington-Ashland area has attained the 8-hour ozone NAAQS. B. The Huntington-Ashland Area Has Met All Applicable Requirements Under Section 110 and Part D of the CAA and Has a Fully Approved SIP Under Section 110(k) of the CAA EPA has determined that Huntington has met all SIP requirements applicable for purposes of this redesignation under section 110 of the CAA (General SIP Requirements) and that it meets all applicable SIP requirements under Part D of Title I of the CAA, in accordance with section 107(d)(3)(E)(v). In addition, EPA has determined that the SIP is fully approved with respect to all requirements applicable for purposes of redesignation in accordance with section 107(d)(3)(E)(ii). In making these proposed determinations, EPA ascertained what requirements are applicable to the Huntington-Ashland area, and determined that the applicable portions of the SIP meeting these requirements are fully approved under section 110(k) of the CAA. We note that SIPs must be fully approved only with respect to applicable requirements. The September 4, 1992 Calcagni memorandum (“Procedures for Processing Requests to Redesignate Areas to Attainment,” Memorandum from John Calcagni, Director, Air Quality Management Division, September 4, 1992) describes EPA's interpretation of section 107(d)(3)(E) with respect to the timing of applicable requirements. Under this interpretation, to qualify for redesignation, States requesting redesignation to attainment must meet only the relevant CAA requirements that came due prior to the submittal of a complete redesignation request. See also Michael Shapiro memorandum, September 17, 1993, and 60 FR 12459, 12465-66 (March 7, 1995) (redesignation of Detroit-Ann Arbor). Applicable requirements of the CAA that come due subsequent to the area's submittal of a complete redesignation request remain applicable until a redesignation is approved, but are not required as a prerequisite to redesignation. Section 175A(c) of the CAA. *Sierra Club* v. *EPA,* 375 F.3d 537 (7th Cir. 2004). See also 68 FR 25424, 25427 (May 12, 2003) (redesignation of St. Louis). 1. Section 110 General SIP Requirements Section 110(a)(2) of Title I of the CAA delineates the general requirements for a SIP, which include enforceable emissions limitations and other control measures, means, or techniques, provisions for the establishment and operation of appropriate devices necessary to collect data on ambient air quality, and programs to enforce the limitations. The general SIP elements and requirements set forth in section 110(a)(2) include, but are not limited to, the following: • Submittal of a SIP that has been adopted by the State after reasonable public notice and hearing; • Provisions for establishment and operation of appropriate procedures needed to monitor ambient air quality; • Implementation of a source permit program; provisions for the implementation of Part C requirement (Prevention of Significant Deterioration (PSD)); • Provisions for the implementation of Part D requirements for New Source Review

(NSR)permit programs; • Provisions for air pollution modeling; and • Provisions for public and local agency participation in planning and emission control rule development. Section 110(a)(2)(D) requires that SIPs contain certain measures to prevent sources in a State from significantly contributing to air quality problems in another State. To implement this provision, EPA has required certain States to establish programs to address transport of air pollutants in accordance with the NO X SIP Call, October 27, 1998 (63 FR 57356), amendments to the NO X SIP Call, May 14, 1999 (64 FR 26298) and March 2, 2000 (65 FR 11222), and the Clean Air Interstate Rule (CAIR), May 12, 2005 (70 FR 25161). However, the section 110(a)(2)(D) requirements for a State are not linked with a particular nonattainment area's designation and classification in that State. EPA believes that the requirements linked with a particular nonattainment area's designation and classifications are the relevant measures to evaluate in reviewing a redesignation request. The transport SIP submittal requirements, where applicable, continue to apply to a State regardless of the designation of any one particular area in the State. Thus, we do not believe that these requirements should be construed to be applicable requirements for purposes of redesignation. In addition, EPA believes that the other section 110 elements not connected with nonattainment plan submissions and not linked with an area's attainment status are not applicable requirements for purposes of redesignation. West Virginia and Kentucky will still be subject to these requirements after the Huntington-Ashland area is redesignated. The section 110 and Part D requirements, which are linked with a particular area's designation and classification, are the relevant measures to evaluate in reviewing a redesignation request. This policy is consistent with EPA's existing policy on applicability of conformity ( *i.e.,* for redesignations) and oxygenated fuels requirement. See Reading, Pennsylvania, proposed and final rulemakings 61 FR 53174-53176 (October 10, 1996), 62 FR 24816 (May 7, 1997); Cleveland-Akron-Lorain, Ohio, final rulemaking 61 FR 20458 (May 7, 1996); and Tampa, Florida, final rulemaking 60 FR 62748 (December 7, 1995). See also the discussion on this issue in the Cincinnati redesignation 65 FR 37890 (June 19, 2000), and in the Pittsburgh redesignation 66 FR 50399 (October 19, 2001). Similarly, with respect to the NO X SIP Call rules, EPA noted in its Phase 1 Final Rule to Implement the 8-hour Ozone NAAQS, that the NO X SIP Call rules are not “an ‘applicable requirement' for purposes of section 110(l) because the NO X rules apply regardless of an area's attainment or nonattainment status for the 8-hour (or the 1-hour) NAAQS.” 69 FR 23951, 23983 (April 30, 2004). EPA believes that section 110 elements not linked to the area's nonattainment status are not applicable for purposes of redesignation. Any section 110 requirements that are linked to the Part D requirements for 8-hour ozone nonattainment areas are not yet due, because, as we explain later in this notice, no Part D requirements applicable for purposes of redesignation under the 8-hour standard became due prior to submission of the redesignation request. Because the West Virginia and Kentucky SIPs satisfy all of the applicable general SIP elements and requirements set forth in section 110(a)(2), EPA concludes that West Virginia and Kentucky have satisfied the criterion of section 107(d)(3)(E) regarding section 110 of the Act. 2. Part D Nonattainment Area Requirements Under the 8-Hour Standard The Huntington-Ashland area was designated a basic nonattainment area for the 8-hour ozone standard. Sections 172-176 of the CAA, found in subpart 1 of Part D, set forth the basic nonattainment requirements for all nonattainment areas. As discussed previously, there are no outstanding Part D submittals under the 1-hour standard for this area. Section 182 of the CAA, found in subpart 2 of Part D, establishes additional specific requirements depending on the area's nonattainment classification. The Huntington-Ashland area was classified as a subpart 1 nonattainment area; therefore, no subpart 2 requirements apply to this area. With respect to the 8-hour standard, EPA proposes to determine that the West Virginia and Kentucky SIPs meet all applicable SIP requirements under Part D of the CAA, because no 8-hour ozone standard Part D requirements applicable for purposes of redesignation became due prior to submission of the area's redesignation request. Because the State submitted a complete redesignation request for Huntington prior to the deadline for any submissions required under the 8-hour standard, we have determined that the Part D requirements do not apply to Huntington for the purposes of redesignation. In addition to the fact that Part D requirements applicable for purposes of redesignation did not become due prior to submission of the redesignation request, EPA believes it is reasonable to interpret the general conformity and NSR requirements as not requiring approval prior to redesignation. With respect to section 176, Conformity Requirements, section 176(c) of the CAA requires States to establish criteria and procedures to ensure that federally supported or funded projects conform to the air quality planning goals in the applicable SIP. The requirement to determine conformity applies to transportation plans, programs, and projects developed, funded or approved under Title 23 U.S.C. and the Federal Transit Act (“transportation conformity”) as well as to all other federally supported or funded projects (“general conformity”). State conformity revisions must be consistent with Federal conformity regulations relating to consultation, enforcement and enforceability that the CAA required the EPA to promulgate. EPA believes it is reasonable to interpret the conformity SIP requirements as not applying for purposes of evaluating the redesignation request under section 107(d) since State conformity rules are still required after redesignation and Federal conformity rules apply where State rules have not been approved. See *Wall* v. *EPA,* 265 F.3d 426, 438-440 (6th Cir. 2001), upholding this interpretation. See also 60 FR 62748 (December 7, 1995). EPA has also determined that areas being redesignated need not comply with the requirement that a NSR program be approved prior to redesignation, provided that the area demonstrates maintenance of the standard without Part D NSR in effect, because PSD requirements will apply after redesignation. The rationale for this view is described in a memorandum from Mary Nichols, Assistant Administrator for Air and Radiation, dated October 14, 1994, entitled, “Part D NSR Requirements or Areas Requesting Redesignation to Attainment.” West Virginia has demonstrated that the area will be able to maintain the standard without Part D NSR in effect in Huntington, and therefore, West Virginia need not have a fully approved Part D NSR program prior to approval of the redesignation request. West Virginia's SIP-approved PSD program will become effective in Huntington upon redesignation to attainment. See rulemakings for Detroit, MI (60 FR 12467-12468, March 7, 1995); Cleveland-Akron-Lorrain, OH (61 FR 20458, 20469-70, May 7, 1996); Louisville, KY (66 FR 53665, October 23, 2001); Grand Rapids, Michigan (61 FR 31834-31837, June 21, 1996). 3. Huntington Has a Fully Approved SIP for the Purposes of Redesignation EPA has fully approved the West Virginia SIP for the purposes of this redesignation. EPA may rely on prior SIP approvals in approving a redesignation request. Calcagni Memo, p. 3; *Southwestern Pennsylvania Growth Alliance* v. *Browner,* 144 F. 3d 984, 989-90 (6th Cir. 1998), *Wall* v. *EPA,* 265 F.3d 426 (6th Cir. 2001), plus any additional measures it may approve in conjunction with a redesignation action. See 68 FR 25425 (May 12, 2003) and citations therein. The Huntington-Ashland area was a 1-hour maintenance area at the time of its designation as a basic 8-hour ozone nonattainment area on April 30, 2004. Because Huntington was a 1-hour maintenance area, all previous Part D SIP submittal requirements were fulfilled at the time the area was redesignated to attainment of the 1-hour ozone NAAQS or have been fulfilled with the submittal of the 8-hour maintenance plan for the area. See rulemakings for Huntington, WV (59 FR 45980 at 45981-45982, September 6, 1994); (59 FR 45019, September 6, 1994); and, (59 FR 65719, December 21, 1994). Because there are no outstanding SIP submission requirements applicable for the purposes of redesignation of Huntington, the applicable implementation plan satisfies all pertinent SIP requirements. As indicated previously, EPA believes that the section 110 elements not connected with Part D nonattainment plan submissions and not linked to the area's nonattainment status are not applicable requirements for purposes of redesignation. EPA also believes that no 8-hour Part D requirements applicable for purposes of redesignation have yet become due for the Huntington-Ashland area, and therefore they need not be approved into the SIP prior to redesignation. 4. The Air Quality Improvement in the Huntington-Ashland Area Is Due to Permanent and Enforceable Reductions in Emissions Resulting From Implementation of the SIP and Applicable Federal Air Pollution Control Regulations and Other Permanent and Enforceable Reductions EPA believes that the States have demonstrated that the observed air quality improvement in the Huntington-Ashland area is due to permanent and enforceable reductions in emissions resulting from implementation of the SIP, Federal measures, and other State-adopted measures. Emissions reductions attributable to these rules in Huntington are shown in Table 4. Table 4.—Total VOC and NO X Emissions for 2002 and 2004

(tpd)Year Point Area* Nonroad Mobile Total Volatile Organic Compounds

(VOC)Year 2002 1.1 11.7 4.1 6.8 23.7 Year 2004 1.3 12.1 4.3 6.0 23.7 Diff. (02-04) +0.2 +0.4 +0.2 −0.8 0 Nitrogen Oxides (NO X ) Year 2002 12.4 1.2 14.0 11.4 39.0 Year 2004 7.4 1.2 17.3 11.5 37.4 Diff. (02-04) −5.0 0 +3.3 +.10 −1.6 * Fire emissions are assumed to remain constant. Between 2002 and 2004, VOC emissions stayed the same, and NO X emissions were reduced by 1.6 tpd, due to the following permanent and enforceable measures implemented or in the process of being implemented in Huntington: Programs Currently in Effect

(a)National Low Emission Vehicle (NLEV);

(b)Motor vehicle fleet turnover with new vehicles meeting the Tier 2 standards; and,

(c)Clean Diesel Program. West Virginia has demonstrated that the implementation of permanent enforceable emissions controls have reduced local VOC and NO X emissions. All of the reductions in VOC are attributable to mobile and nonroad source emission controls such as federally mandated Tier 2 Vehicle and Gasoline Sulfur Program and the Clean Diesel Program. Nearly all of the reductions in NO X are attributable to the implementation of the NO X SIP Call. West Virginia has indicated in its submittal that the implementation of the NO X SIP Call, with its mandatory reductions in NO X emissions from Electric Generating Units

(EGUs)and large industrial boilers (non-EGUs), reduced NO X emissions throughout the Huntington-Ashland area. NO X emissions from EGUs in Huntington were reduced by 0.3 tpd between 2002 and 2004. Also, NO X emissions from non-EGU sources in Huntington were reduced by 4.7 tpd between 2002 and 2004. Reductions in NO X emissions from the implementation of the NO X SIP Call from EGUs and non-EGUs in counties adjacent to the Huntington (Cabell and Wayne Counties), such as Boyd (the other county in the Huntington-Ashland area) and Lawrence Counties in Kentucky and Putnam County in West Virginia have also occurred. The WVDEP believes that the improvement in ozone air quality from 2002 to 2004 was the result of identifiable, permanent and enforceable reductions in ozone precursor emissions for the same period. Additionally, WVDEP has identified, but not quantified, additional reductions in VOC emissions that will be achieved as a co-benefit of the reductions in the emission of hazardous air pollutants

(HAPs)as a result of implementation of EPA's Maximum Achievable Control Technology

(MACT)standards. Other regulations, such as the non-road diesel, 69 FR 39858 (June 29, 2004), the heavy duty engine and vehicle standards, 66 FR 5002 (January 18, 2001) and the new Tier 2 tailpipe standards for automobiles, 65 FR 6698 (January 10, 2000), are also expected to greatly reduce emissions throughout the country and thereby reduce emissions impacting the Huntington-Ashland area monitors. The Tier 2 standards came into effect in 2004, and by 2030, EPA expects that the new Tier 2 standards will reduce NO X emissions by about 74 percent nationally. EPA believes that permanent and enforceable emissions reductions are the cause of the long-term improvement in ozone levels and are the cause of the Huntington-Ashland area achieving attainment of the 8-hour ozone standard. 5. Huntington Has a Fully Approved Maintenance Plan Pursuant to Section 175A of the CAA In conjunction with its request to redesignate Huntington to attainment status, West Virginia submitted a SIP revision to provide for maintenance of the 8-hour ozone NAAQS in Huntington for at least 12 years after redesignation. West Virginia is requesting that EPA approve this SIP revision as meeting the requirement of CAA 175A(b) and replace the 1-hour ozone maintenance plan update requirement. Under 40 CFR 51.905(e), the EPA may approve a SIP revision requesting the removal of the obligation to implement contingency measures upon a violation of the 1-hour ozone NAAQS when the State submits and EPA approves an attainment demonstration for the 8-hour ozone NAAQS for an area *initially designated* nonattainment for the 8-hour NAAQS or a maintenance SIP for the 8-hour NAAQS for an area *initially designated* attainment for the 8-hour NAAQS. The rationale behind 40 CFR 51.905(e) is to ensure that Huntington maintains the applicable ozone standard (the 8-hour standard in areas where the 1-hour standard has been revoked). EPA believes this rationale analogously applies to areas that were not initially designated, but are *redesignated* as attainment with the 8-hour ozone NAAQS. Therefore, EPA intends to treat redesignated areas as though they had been initially designated attainment of the 8-hour ozone NAAQS, and accordingly proposes to relieve Huntington of its maintenance plan obligations with respect to the 1-hour standard. Once approved, the maintenance plan for the 8-hour ozone NAAQS will ensure that the SIP for Huntington meets the requirements of the CAA regarding maintenance of the applicable 8-hour ozone standard. What is required in a maintenance plan? Section 175A of the CAA sets forth the elements of a maintenance plan for areas seeking redesignation from nonattainment to attainment. Under section 175A, the plan must demonstrate continued attainment of the applicable NAAQS for at least 10 years after approval of a redesignation of an area to attainment. Eight years after the redesignation, the State must submit a revised maintenance plan demonstrating that attainment will continue to be maintained for the next 10-year period following the initial 10-year period (12 years in Huntington's case). To address the possibility of future NAAQS violations, the maintenance plan must contain such contingency measures, with a schedule for implementation, as EPA deems necessary to assure prompt correction of any future 8-hour ozone violations. Section 175A of the CAA sets forth the elements of a maintenance plan for areas seeking redesignation from nonattainment to attainment. The Calcagni memorandum dated September 4, 1992, provides additional guidance on the content of a maintenance plan. An ozone maintenance plan should address the following provisions:

(a)An attainment emissions inventory;

(b)A maintenance demonstration;

(c)A monitoring network;

(d)Verification of continued attainment; and

(e)A contingency plan. Analysis of the Huntington Maintenance Plan

(a)Attainment Inventory—An attainment inventory includes the emissions during the time period associated with the monitoring data showing attainment. An attainment year of 2004 was used for Huntington since it is a reasonable year within the 3-year block of 2002-2004 and accounts for reductions attributable to implementation of the CAA requirements to date. The WVDEP prepared comprehensive VOC and NO X emissions inventories for Huntington, including point, area, mobile on-road, and mobile non-road sources for a base year of 2002. To develop the NO X and VOC base year emissions inventories, WVDEP used the following approaches and sources of data:

(i)*Point source emissions* —West Virginia maintains its point source emissions inventory data on the i-STEPS database, which is commercial software purchased from a vendor, Pacific Environmental Services. Facilities subject to emissions inventory reporting requirements were those operating point sources subject to Title V permitting requirements. Affected sources were identified from the WVDEP's Regulation 30 database which is maintained by the WVDEP's Title V Permitting Group. For the 2002 inventory, diskettes were populated with i-STEPS software information, as well as source-specific data from the previous year and sent to facilities for updates of their 2002 activity and emissions data. The facilities then sent the diskettes back to the State and, where WVDEP staff quality assured the data and submitted it to EPA's Central Data Exchange

(CDX)site as well as to contractors for the Visibility Improvement State and Tribal Association of the Southeast (VISTAS), a Regional Planning Organization (RPO). WVDEP used EPA's Clean Air Markets Division

(CAMD)actual data to calculate 2002 summer daily NO X emissions from EGUs. To calculate summer weekday NO X emissions WVDEP used EPA's CAMD data for the date range of June 1, 2002 through August 31, 2002. WVDEP staff filtered the resulting NO X data to select West Virginia sources (Ceredo and Big Sandy peaking stations). The NO X data was downloaded, all weekend days were deleted and the remaining emissions were added together, and the total was divided by 65. Since, CAMD data does not require VOC emissions reporting, WVDEP used VISTAS summer daily VOC emissions values for 2002.

(ii)*Area source emissions* —In order to calculate the area source emissions inventory the WVDEP took the annual values from the VISTAS base year inventory and derived the typical ozone summer weekday, using procedures outlined in the EPA's Emissions Modeling Clearinghouse

(EMCH)Memorandum, “Temporal Allocation of Annual Emissions Using EMCH Temporal Profiles, April 29, 2002.” This enabled WVDEP to arrive at the “typical” summer day emissions.

(iii)*On-road mobile source emissions* —VISTAS developed 2002 on-road mobile (highway) emissions inventory data based on vehicle miles traveled

(VMT)updates provided by WVDEP. VISTAS also estimated future emissions based upon expected growth for the future years 2009 and 2018. However, Federal Transportation Conformity requirements dictate that the WVDEP consult with the Metropolitan Planning Organization

(MPO)responsible for transportation planning in developing SIP revisions which may establish motor vehicle emissions budgets (MVEB). This applies to the maintenance plan submitted by WVDEP on May 17, 2006. Therefore, the WVDEP has consulted with the Huntington MPO, the KYOVA Interstate Planning Commission (KYOVA). The KYOVA provided base year and projection emissions data consistent with their most recent available Travel Demand Model

(TDM)results along with EPA's most recent emission factor model, MOBILE6.2. The WVDEP used these data to estimate highway emissions and, in consultation with the KYOVA, to develop highway emissions budgets for VOC and NO X . The KYOVA must evaluate future Long Range Transportation Plans and Transportation Improvement Programs to ensure that the associated emissions are equal to or less then the final emissions budgets. The budgets are designed to facilitate a positive conformity determination while ensuring overall maintenance of the 8-hour NAAQS. It should be noted that the MVEBs and budgets only represent the Huntington, West Virginia (Cabell and Wayne Counties) portion of the nonattainment area.

(iv)*Mobile non-road emissions* —The 2002 mobile non-road emissions inventory was developed by WVDEP staff using the NONROAD2005b Model. The 2004 attainment year VOC and NO X emissions Huntington are summarized along with the 2009 and 2018 projected emissions for Huntington in tables 5 and 6, which covers the demonstration of maintenance for this portion of the area. EPA has concluded that West Virginia has adequately derived and documented the 2004 attainment year VOC and NO X emissions for Huntington.

(b)Maintenance Demonstration—On May 17, 2006, the WVDEP submitted a SIP revision to supplement its May 17, 2006 redesignation request. The submittal by WVDEP consists of the maintenance plan as required by section 175A of the CAA. The Huntington plan shows maintenance of the 8-hour ozone NAAQS by demonstrating that current and future emissions of VOC and NO X remain at or below the attainment year 2004 emissions levels throughout Huntington through the year 2018. The Huntington maintenance demonstration need not be based on modeling. *See Wall* v. *EPA* , 265 F.3d 426 (6th Cir. 2001); *Sierra Club* v. *EPA* , 375 F.3d 537 (7th Cir. 2004). See also 66 FR 53094, 53099-53100 (October 19, 2001), 68 FR 25430-32 (May 12, 2003). Tables 5 and 6 specify the Huntington VOC and NO X emissions for 2004, 2009, and 2018. The WVDEP chose 2009 as an interim year in the 12-year maintenance demonstration period to demonstrate that the VOC and NO X emissions are not projected to increase above the 2004 attainment level during the time of the 12-year maintenance period. Table 5.—Total VOC Emissions for 2004-2018

(tpd)Source category 2004 VOC emissions 2009 VOC emissions 2018 VOC emissions Mobile 1 6.0 4.6 3.0 Nonroad 4.3 3.9 3.2 Area 2 12.1 11.2 12.4 Point 1.3 0.9 1.1 Total 3 23.7 20.6 19.7 1 2004 emissions are actual; Emission budgets are established for 2009 and 2018 and include a reallocation from the safety margin. 2 Fire emissions are assumed to remain constant. 3 Sums may not total exactly due to rounding. Table 6.—Total NO X Emissions 2004-2018

(tpd)Source category 2004 NO X emissions 1 2009 NO X emissions 2018 NO X emissions Mobile 1 11.5 8.7 4.1 Nonroad 17.3 13.4 12.6 Area 2 1.2 1.3 1.5 Point 7.4 8.1 8.8 Total 3 37.4 31.5 27.0 1 2004 emissions are actual; Emission budgets are established for 2009 and 2018 and include a reallocation from the safety margin. 2 Fire emissions are assumed to remain constant. 3 Sums may not total exactly due to rounding. Additionally, the following mobile programs are either effective or due to become effective and will further contribute to the maintenance demonstration of the 8-hour ozone NAAQS: • Heavy duty diesel on-road (2004/2007) and low-sulfur on-road (2006); 66 FR 2001 (January 18, 2001); and • Non-road emissions standards

(2008)and off-road diesel fuel (2007/2010); 69 FR 39858 (June 29, 2004). In addition to the permanent and enforceable measures, CAIR, promulgated May 12, 2005 (70 FR 25161) should have positive impacts on West Virginia and Kentucky's air quality. CAIR, which will be implemented in the eastern portion of the country in two phases (2009 and 2015), should reduce long range transport of ozone precursors, which will have a beneficial effect on air quality in the Huntington-Ashland area. Currently, West Virginia is in the process of adopting rules to address CAIR through State rules 45CSR39, 45CSR40, and 45CSR41, which require annual and ozone season NO X reductions from EGUs and ozone season NO X reductions from non-EGUs. These rules will be submitted to EPA as a SIP revision by September 11, 2006 as required in the May 12, 2005 (70 FR 25161) **Federal Register** publication. Based upon the comparison of the projected emissions and the attainment year emissions along with the additional measures, EPA concludes that WVDEP has successfully demonstrated that the 8-hour ozone standard should be maintained in Huntington.

(c)Monitoring Network—There is currently two monitor measuring ozone in the Huntington-Ashland area, one in Cabell County, West Virginia and one in Boyd County, Kentucky. West Virginia will continue to operate its current air quality monitor (located in Cabell County) in accordance with 40 CFR part 58.

(d)Verification of Continued Attainment—The State of West Virginia has the legal authority to implement and enforce specified measures necessary to attain and maintain the NAAQS. Additionally, Federal programs such as Tier 2/Low Sulfur Gasoline Rule, 2007 On-Road Diesel Engine Rule, and Federal Non-road Engine/Equipment Rules will continue to be implemented on a national level. These programs help provide the reductions necessary for the Huntington-Ashland area to maintain attainment. In addition to maintaining the key elements of its regulatory program, West Virginia requires ambient and source emissions data to track attainment and maintenance. The WVDEP proposes to fully update its point, area, and mobile emission inventories at 3-year intervals as required by the Consolidated Emissions Reporting Rule

(CERR)to assure that its growth projections relative to emissions in these areas are sufficiently accurate to assure ongoing attainment with the NAAQS. The WVDEP will review stationary source VOC and NO X emissions by review of annual emissions statements and by update of its emissions inventories. The area source inventory will be updated using the same techniques as the 2002 ozone inventory. However, some source categories may be updated using historic activity levels determined from Bureau of Economic Analysis

(BEA)data or West Virginia University/Regional Research Institute (WVU/RRI) population estimates. The mobile source inventory model will be updated by obtaining county-level VMT from the West Virginia Department of Transportation (WVDOT) for the subject year and calculating emissions using the latest approved MOBILE model. Alternatively, the motor vehicle emissions may be obtained in consultation with the Metropolitan Planning Organization (MPO), the KYOVA, using methodology similar to that used for Transportation Conformity purposes. The WVDEP shall also continue to operate the existing ozone monitoring stations in the areas pursuant to 40 CFR 58 throughout the maintenance period and submit quality-assured ozone data to EPA through the AIRS system.

(e)The Maintenance Plan's Contingency Measures—The contingency plan provisions are designed to promptly correct a violation of the NAAQS that occurs after redesignation. Section 175A of the Act requires that a maintenance plan include such contingency measures as EPA deems necessary to ensure that the State will promptly correct a violation of the NAAQS that occurs after redesignation. The maintenance plan should identify the events that would “trigger” the adoption and implementation of a contingency measure(s), the contingency measure(s) that would be adopted and implemented, and the schedule indicating the time frame by which the State would adopt and implement the measure(s). The ability of Huntington to stay in compliance with the 8-hour ozone standard after redesignation depends upon VOC and NO X emissions in Huntington remaining at or below 2004 levels. The State's maintenance plan projects VOC and NO X emissions to decrease and stay below 2004 levels through the year 2018. The State's maintenance plan lays out two situations where the need to adopt and implement a contingency measure to further reduce emissions would be triggered. Those situations are as follows:

(i)*If the triennial inventories indicate emissions growth in excess of 10 percent of the 2002 base-year inventory or if a monitored air quality exceedance pattern indicates that an ozone NAAQS violation may be imminent* —The maintenance plan states that an exceedance pattern would include, but is not limited to, the measurement of three exceedances or more occurring at the same monitor during a calendar year. The plan also states that comprehensive tracking inventories will also be developed every 3 years using current EPA-approved methods to assure that its growth projections relative to emissions in Huntington are sufficiently accurate to assure ongoing attainment with the NAAQS. If the 2002 base-year inventory or a monitored air quality exceedance pattern occurs, the following measure will be implemented: • WVDEP will evaluate existing control measures to ascertain if additional regulatory revisions are necessary to maintain the ozone standard.

(ii)*In the event that a violation of the 8-hour ozone standard occurs at either the Cabell County, West Virginia or the Boyd County, Kentucky monitor* —The maintenance plan states that in the event that a violation of the ozone standard occurs at either the Cabell County, West Virginia or the Boyd County, Kentucky ozone monitor, the State of West Virginia, in consultation with EPA Region III, will implement one or more of the following measures to assure continued attainment: • Extend the applicability of 45CSR21 (VOC/RACT rule) to include source categories previously excluded ( *e.g.* , waste water treatment facilities); • Revised new source permitting requirements requiring more stringent emissions control technology and/or emissions offsets; • NO X RACT requirements; • Regulations to establish plant-wide emissions caps (potentially with emissions trading provisions); • Establish a Public Awareness/Ozone Action Day Program, a two pronged program focusing on increasing the public's understanding of air quality issues in the region and increasing support for actions to improve the air quality, resulting in reduced emissions on days when the ozone levels are likely to be high. • Initiate one or more of the following voluntary local control measures:

(1)Bicycle and Pedestrian Measures—A series of measures designed to promote bicycling and walking including both promotional activities and enhancing the environment for these activities;

(2)Reduce Engine Idling—Voluntary programs to restrict heavy duty diesel engine idling times for both trucks and school buses;

(3)Voluntary Partnership with Ground Freight Industry—A voluntary program using incentives to encourage the ground freight industry to reduce emissions;

(4)Increase Compliance with Open Burning Restrictions—Increase public awareness of the existing open burning restrictions and work with communities to increase compliance; and

(5)School Bus Engine Retrofit Program—Have existing school bus engines retrofitted to lower emissions. The following schedule for adoption, implementation and compliance applies to the contingency measures concerning the option of implementing regulatory requirements. • Confirmation of the monitored violation within 45 days of occurrence; • Measure to be selected within 3 months after verification of a monitored ozone standard violation; • Develop rule within 6 months of selection of measure; • File rule with state secretary (process takes up to 42 days); • Applicable regulation to be fully implemented within 6 months after adoption. The following schedule for adoption, implementation and compliance applies to the voluntary contingency measures. • Confirmation of the monitored violation within 45 days of occurrence; • Measure to be selected within 3 months after verification of a monitored ozone standard violation; • Initiation of program development with local governments within Huntington by the start of the following ozone season.

(f)An Additional Provision of the Maintenance Plan—The State's maintenance plan for Huntington has an additional provision. That provision states that based on the 2002 inventory data and calculation methodology, it is expected that area and mobile source emissions would not exhibit substantial increases between consecutive periodic year inventories. Therefore, if significant unanticipated emissions growth occurs, it is expected that point sources would be the cause. West Virginia regulation 45 CSR 29 requires significant point source emitters in six counties, including Cabell and Wayne, to submit annual emission statements which contain emission totals for VOCs and NO X . Any significant increases that occur can be identified from these reports without waiting for a periodic inventory. This gives West Virginia the capability to identify needed regulations by source, source category and pollutant and to begin the rule promulgation process, if necessary, in an expeditious manner. The maintenance plan adequately addresses the five basic components of a maintenance plan: attainment inventory, maintenance demonstration, monitoring network, verification of continued attainment, and a contingency plan. EPA believes that the maintenance plan SIP revision submitted by West Virginia for Huntington meets the requirements of section 175A of the Act. VII. Are the Motor Vehicle Emissions Budgets Established and Identified in the Huntington Maintenance Plan Adequate and Approvable? A. What Are the Motor Vehicle Emissions Budgets (MVEBs)? Under the CAA, States are required to submit, at various times, control strategy SIPs and maintenance plans in ozone areas. These control strategy SIPs ( *i.e.,* RFP SIPs and attainment demonstration SIPs) and maintenance plans identify and establish MVEBs for certain criteria pollutants and/or their precursors to address pollution from on-road mobile sources. In the maintenance plan the MVEBs are termed “on-road mobile source emissions budgets.” Pursuant to 40 CFR part 93 and 51.112, MVEBs must be established in an ozone maintenance plan. An MVEB is the portion of the total allowable emissions that is allocated to highway and transit vehicle use and emissions. An MVEB serves as a ceiling on emissions from an area's planned transportation system. The MVEB concept is further explained in the preamble to the November 24, 1993, transportation conformity rule (58 FR 62188). The preamble also describes how to establish and revise the MVEBs in control strategy SIPs and maintenance plans. Under section 176(c) of the CAA, new transportation projects, such as the construction of new highways, must “conform” to ( *i.e.* , be consistent with) the part of the State's air quality plan that addresses pollution from cars and trucks. “Conformity” to the SIP means that transportation activities will not cause new air quality violations, worsen existing violations, or delay timely attainment of or reasonable progress towards the national ambient air quality standards. If a transportation plan does not “conform,” most new projects that would expand the capacity of roadways cannot go forward. Regulations at 40 CFR part 93 set forth EPA policy, criteria, and procedures for demonstrating and assuring conformity of such transportation activities to an SIP. When reviewing submitted “control strategy” SIPs or maintenance plans containing MVEBs, EPA must affirmatively find the MVEB budget contained therein “adequate” for use in determining transportation conformity. After EPA affirmatively finds the submitted MVEB is adequate for transportation conformity purposes, that MVEB can be used by State and Federal agencies in determining whether proposed transportation projects “conform” to the state implementation plan as required by section 176(c) of the CAA. EPA's substantive criteria for determining “adequacy” of a MVEB are set out in 40 CFR 93.118(e)(4). EPA's process for determining “adequacy” consists of three basic steps: Public notification of an SIP submission, a public comment period, and EPA's adequacy finding. This process for determining the adequacy of submitted SIP MVEBs was initially outlined in EPA's May 14, 1999 guidance, “Conformity Guidance on Implementation of March 2, 1999, Conformity Court Decision.” This guidance was finalized in the Transportation Conformity Rule Amendments for the “New 8-Hour Ozone and PM2.5 National Ambient Air Quality Standards and Miscellaneous Revisions for Existing Areas; Transportation Conformity Rule Amendments—Response to Court Decision and Additional Rule Change” on July 1, 2004 (69 FR 40004). EPA follows this guidance and rulemaking in making its adequacy determinations. The MVEBs for Huntington are listed in Table 1 of this document for the 2004, 2009, and 2018 years and are the projected emissions for the on-road mobile sources plus any portion of the safety margin allocated to the MVEBs (safety margin allocation for 2009 and 2018 only). These emission budgets, when approved by EPA, must be used for transportation conformity determinations. B. What Is a Safety Margin? A “safety margin” is the difference between the attainment level of emissions (from all sources) and the projected level of emissions (from all sources) in the maintenance plan. The attainment level of emissions is the level of emissions during one of the years in which the area met the NAAQS. The following example is for the 2018 safety margin: Huntington first attained the 8-hour ozone NAAQS during the 2002 to 2004 time period. The State used 2004 as the year to determine attainment levels of emissions for Huntington. The total emissions from point, area, mobile on-road, and mobile non-road sources in 2004 equaled 23.7 tpd of VOC and 37.4 tpd of NO X . The WVDEP projected emissions out to the year 2018 and projected a total of 19.7 tpd of VOC and 27.0 tpd of NO X from all sources in Huntington. The safety margin for 2018 would be the difference between these amounts, or 4.0 tpd of VOC and 10.4 tpd of NO X . The emissions up to the level of the attainment year including the safety margins are projected to maintain the area's air quality consistent with the 8-hour ozone NAAQS. The safety margin is the extra emissions reduction below the attainment levels that can be allocated for emissions by various sources as long as the total emission levels are maintained at or below the attainment levels. Table 7 shows the safety margins for the 2009 and 2018 years. Table 7.—2009 and 2018 Safety Margins for Huntington Inventory year VOC emissions

(tpd)NO X emissions

(tpd)2004 Attainment 23.7 37.4 2009 Interim 20.6 31.5 2009 Safety Margin 3.1 5.9 2004 Attainment 23.7 37.4 2018 Final 19.7 27.0 2018 Safety Margin 4.0 10.4 The WVDEP allocated 1.1 tpd NO X and 0.6 tpd VOC to the 2009 interim VOC projected on-road mobile source emissions projection and the 2009 interim NO X projected on-road mobile source emissions projection to arrive at the 2009 MVEBs. For the 2018 MVEBs the WVDEP allocated 0.5 tpd NO X and 0.4 tpd VOC from the 2018 safety margins to arrive at the 2018 MVEBs. Once allocated to the mobile source budgets these portions of the safety margins are no longer available, and may no longer be allocated to any other source category. Table 8 shows the final 2009 and 2018 MVEBS for Huntington. Table 8.—2009 and 2018 Final MVEBs for Huntington Inventory year VOC emissions

(tpd)NO X emissions

(tpd)2009 projected on-road mobile source projected emissions 4.0 7.6 2009 Safety Margin Allocated to MVEBs 0.6 1.1 2009 MVEBs 4.6 8.7 2018 projected on-road mobile source projected emissions 2.6 3.6 2018 Safety Margin Allocated to MVEBs 0.4 0.5 2018 MVEBs 3.0 4.1 C. Why Are the MVEBs Approvable? The 2009 and 2018 MVEBs for Huntington are approvable because the MVEBs for NO X and VOC, including the allocated safety margins, continue to maintain the total emissions at or below the attainment year inventory levels as required by the transportation conformity regulations. D. What Is the Adequacy and Approval Process for the MVEBs in the Huntington Maintenance Plan? The MVEBs for the Huntington maintenance plan are being posted to EPA's conformity Web site concurrent with this proposal. The public comment period will end at the same time as the public comment period for this proposed rule. In this case, EPA is concurrently processing the action on the maintenance plan and the adequacy process for the MVEBs contained therein. In this proposed rule, EPA is proposing to find the MVEBs adequate and also proposing to approve the MVEBs as part of the maintenance plan. The MVEBs cannot be used for transportation conformity until the maintenance plan update and associated MVEBs are approved in a final **Federal Register** notice, or EPA otherwise finds the budgets adequate in a separate action following the comment period. If EPA receives adverse written comments with respect to the proposed approval of the Huntington MVEBs, or any other aspect of our proposed approval of this updated maintenance plan, we will respond to the comments on the MVEBs in our final action or proceed with the adequacy process as a separate action. Our action on the Huntington MVEBs will also be announced on EPA's conformity Web site: *http://www.epa.gov/oms/traq,* (once there, click on the “Conformity” button, then look for “Adequacy Review of SIP Submissions for Conformity”). VIII. Proposed Actions EPA is proposing to determine that the Huntington-Ashland area has attained the 8-hour ozone NAAQS. EPA is also proposing to approve the redesignation of the Huntington portion of the Huntington-Ashland area from nonattainment to attainment for the 8-hour ozone NAAQS. EPA has evaluated West Virginia's redesignation request and determined that it meets the redesignation criteria set forth in section 107(d)(3)(E) of the CAA. EPA believes that the redesignation request and monitoring data demonstrate that the Huntington-Ashland area has attained the 8-hour ozone standard. The final approval of this redesignation request would change the designation of Huntington from nonattainment to attainment for the 8-hour ozone standard. EPA is also proposing to approve the associated maintenance plan for Huntington, submitted on May 17, 2006, as a revision to the West Virginia SIP. EPA is proposing to approve the maintenance plan for Huntington because it meets the requirements of section 175A as described previously in this notice. EPA is also proposing to approve the MVEBs submitted by West Virginia for Huntington in conjunction with its redesignation request. EPA is soliciting public comments on the issues discussed in this document. These comments will be considered before taking final action. IX. Statutory and Executive Order Reviews Under Executive Order 12866 (58 FR 51735, October 4, 1993), this proposed action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)). This action merely proposes to approve state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Redesignation of an area to attainment under section 107(d)(3)(e) of the Clean Air Act does not impose any new requirements on small entities. Redesignation is an action that affects the status of a geographical area and does not impose any new regulatory requirements on sources. Redesignation of an area to attainment under section 107(d)(3)(E) of the Clean Air Act does not impose any new requirements on small entities. Redesignation is an action that affects the status of a geographical area and does not impose any new regulatory requirements on sources. Accordingly, the Administrator certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 *et seq.* ). Because this rule proposes to approve pre-existing requirements under State law and does not impose any additional enforceable duty beyond that required by State law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). This proposed rule also does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), nor will it have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely proposes to affect the status of a geographical area, does not impose any new requirements on sources, or allow the State to avoid adopting or implementing other requirements, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This proposed rule also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant. In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. In this context, in the absence of a prior existing requirement for the State to use voluntary consensus standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission, to use VCS in place of a SIP submission that otherwise satisfies the provisions of the Clean Air Act. Redesignation is an action that affects the status of a geographical area and does not impose any new requirements on sources. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this proposed rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings” issued under the executive order. This rule proposing to approve the redesignation of the Huntington area to attainment for the 8-hour ozone NAAQS, the associated maintenance plan, and the MVEBs identified in the maintenance plan, does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ). This rule proposing to approve the redesignation of Huntington to attainment for the 8-hour ozone NAAQS, the associated maintenance plan, and the MVEBs identified in the maintenance plan, does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ). List of Subjects 40 CFR Part 52 Environmental protection, Air pollution control, Nitrogen oxides, Ozone, Reporting and recordkeeping requirements, Volatile organic compounds. 40 CFR Part 81 Air pollution control, National Parks, Wilderness Areas. Authority: 42 U.S.C. 7401 *et seq.* Dated: July 6, 2006. William T. Wisniewski, Acting Regional Administrator, Region III. [FR Doc. E6-11042 Filed 7-12-06; 8:45 am] BILLING CODE 6560-50-P DEPARTMENT OF HOMELAND SECURITY Coast Guard 46 CFR Part 401 [USCG-2006-24414] RIN 1625-AB05 Rates for Pilotage on the Great Lakes AGENCY: Coast Guard, DHS. ACTION: Notice of proposed rulemaking. SUMMARY: The Coast Guard is proposing to update the rates for pilotage on the Great Lakes. Based on our review we propose to adjust the pilotage rates an average of 6% for the 2006 shipping season to generate sufficient revenue to cover allowable expenses, target pilot compensation, and returns on investment. DATES: Comments and related material must reach the Docket Management Facility on or before August 14, 2006. ADDRESSES: To make sure your comments and related material are not entered more than once in the docket, please submit them by only one of the following means:

(1)By mail to the Docket Management Facility (USCG-2006-24414), U.S. Department of Transportation, room PL-401, 400 Seventh Street, SW., Washington, DC 20590-0001.

(2)By delivery to room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The telephone number is 202-366-9329.

(3)By fax to the Docket Management Facility at 202-493-2251.

(4)Electronically through the Web site for the Docket Management System at *http://dms.dot.gov* . The Docket Management Facility maintains the public docket for this rulemaking. Comments and material received from the public, as well as documents mentioned in this preamble as being available in the docket, will become part of this docket and will be available for inspection or copying at room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. You may also find this docket on the Internet at *http://dms.dot.gov* . Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78), or you may visit *http://dms.dot.gov* . FOR FURTHER INFORMATION CONTACT: For questions on this proposed rule, call Mr. Michael Sakaio, Program Analyst, Office of Great Lakes Pilotage, Commandant (G-PWM), U.S. Coast Guard, at 202-372-1538, by fax 202-372-1929, or by e-mail at *msakaio@comdt.uscg.mil* . For questions on viewing or submitting material to the docket, call Renee V. Wright, Chief, Dockets, Department of Transportation, telephone 202-493-0402. Table of Contents I. Public Participation and Request for Comments A. Submitting Comments B. Viewing Comments and Documents C. Public Meeting D. Privacy Act II. Program History III. Purpose of the Proposed Rule A. Proposed Pilotage Rate Changes—Summarized B. Calculating the Rate Adjustment Step 1: Calculating the Base Period Total Economic Cost (Cost per Bridge Hour by Area for the Base Period) Step 2. Calculating the Expense Multiplier Step 3. Calculating the new annual “projection of target pilot compensation” using the same procedures found in Step 2 of Appendix A to 46 CFR part 404. Step 4: Increase the new total target pilot compensation in Step 3 by the expense multiplier in Step 2. Step 5(a): Adjust the result in Step 4, as required, for inflation or deflation. Step 5(b): Calculate Projected Total Economic Costs. Step 6: Divide the Result in Step 5(b) by Projected Bridge Hours to Determine Total Unit Costs (Adjusted Cost per Bridge Hour by Area). Step 7: Divide prospective unit costs in Step 6 by the base period unit costs in Step 1. Step 8: Adjust the base period rates by the percentage change in unit costs in Step 7. IV. Regulatory Evaluation A. Small Entities B. Assistance for Small Entities C. Collection of Information D. Federalism E. Unfunded Mandates Reform Act F. Taking of Private Property G. Civil Justice Reform H. Protection of Children I. Indian Tribal Governments J. Energy Effects K. Technical Standards L. Environment V. Regulatory Text SUPPLEMENTARY INFORMATION: I. Public Participation and Request for Comments We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted, without change, to *http://dms.dot.gov* and will include any personal information you have provided. We have an agreement with the Department of Transportation

(DOT)to use the Docket Management Facility. Please see DOT's “Privacy Act” paragraph below. *A. Submitting Comments:* If you submit a comment, please include your name and address, identify the docket number for this rulemaking (USCG-2006-24414), indicate the specific section of this document to which each comment applies, and give the reason for each comment. You may submit your comments and material by electronic means, mail, fax, or delivery to the Docket Management Facility at the address under ADDRESSES ; but please submit your comments and material by only one means. If you submit them by mail or delivery, submit them in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying and electronic filing. If you submit them by mail and would like to know that they reached the Facility, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this rule in view of them. *B. Viewing comments and documents:* To view comments, as well as documents mentioned in this preamble as being available in the docket, go to *http://dms.dot.gov* at any time and conduct a simple search using the docket number. You may also visit the Docket Management Facility in room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. *C. Public Meeting:* We do not plan to hold a public meeting. But you may submit a request for one to the Docket Management Facility at the address under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the **Federal Register** . *D. Privacy Act:* Anyone can search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review the Department of Transportation's Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477), or you may visit *http://dms.dot.gov* . II. Program History The Great Lakes Pilotage Act of 1960 requires foreign-flag vessels and U.S.-flag vessels in foreign trade to use federal Great Lakes registered pilots while transiting the St. Lawrence Seaway and the Great Lakes system. 46 U.S.C. Chapter 93, §§ 9302 and 9308. The Coast Guard is responsible for administering this pilotage program, which includes setting rates for pilotage service. The U.S. waters of the Great Lakes and the St. Lawrence Seaway are divided into three pilotage Districts. Pilotage in each District is provided by an association certified by the Director of Great Lakes Pilotage to operate a pilotage pool. It is important to note that, while the Coast Guard sets rates, it does not control the actual compensation that pilots receive. This is determined by each of the three District associations, which use different compensation practices. District One, consisting of Areas 1 and 2, includes all U.S. waters of the St. Lawrence River and Lake Ontario. District Two, consisting of Areas 4 and 5, includes all U.S. waters of Lake Erie, the Detroit River, Lake St. Clair, and the St. Clair River. District Three, consisting of Areas 6, 7, and 8, includes all U.S. waters of the St. Mary's River, Sault Ste. Marie Locks, and Lakes Michigan, Huron, and Superior. Area 3 is the Welland Canal, which is serviced exclusively by the Canadian Great Lakes Pilotage Authority and, accordingly, is not included in the U.S. rate structure. Areas 1, 5, and 7 have been designated by Presidential Proclamation, pursuant to the Great Lakes Pilotage Act of 1960, to be waters in which pilots must at all times be fully engaged in the navigation of vessels in their charge. These waters were “designated” because they are difficult waters to navigate. Areas 2, 4, 6 and 8 have not been so designated because they are open bodies of water. Under the Great Lakes Pilotage Act of 1960, pilots assigned to vessels in these areas are only required “to be on board and available to direct the navigation of a vessel at the discretion of and subject to the customary authority of the master.” 46 U.S.C. 9302(a)(1)(A) and (B). The Coast Guard pilotage regulations require annual reviews of pilotage rates and the creation of a new rate at least once every five years, or sooner, if annual reviews show a need. 46 CFR part 404. To assist in calculating pilotage rates, the pilotage associations are required to submit to the Coast Guard annual financial statements prepared by certified public accounting firms. In addition, every fifth year, in connection with the mandatory rate adjustment, the Coast Guard contracts with an independent accounting firm to conduct a full ratemaking by auditing the accounts and records of the pilotage associations and by preparing and submitting financial reports relevant to the ratemaking process. In those years when a full ratemaking is conducted, the Coast Guard generates the pilotage rates using Appendix A to 46 CFR part 404. Between the five-year full ratemaking intervals, the Coast Guard annually reviews the pilotage rates using Appendix C to 46 CFR part 404, and adjusts rates when deemed appropriate. The last full ratemaking was published in the **Federal Register** on April 3, 2006 (71 FR 16501). In that ratemaking, the Coast Guard applied the Appendix A methodology for calculating rates. For this annual rate review and adjustment, we are using the methodology contained in Appendix C. III. Purpose of the Proposed Rule The authority to establish pilotage rates on the Great Lakes derives from 46 U.S.C. 9303(f), which states that: “[t]he Secretary shall prescribe by regulation rates and charges for pilotage services, giving consideration to the public interest and the costs of providing the services.” The pilotage regulations require that pilotage rates be reviewed annually. If the annual review shows that pilotage rates are within a reasonable range of the base target pilot compensation set in the full ratemaking, no adjustment to the rates will be initiated. (Target pilot compensation is defined in 46 CFR part 404, Appendix B, and is the compensation that pilots are intended to receive for full time employment.) However, if the annual review indicates that an adjustment is necessary, then the Coast Guard will establish new pilotage rates using § 404.10 and either Appendix A or Appendix C of part 404. The Appendix C ratemaking methodology is intended for use during the years between Appendix A full ratemaking reviews and adjustments. This section is a description of the analyses performed, and the eight-step methodology followed, in the development of the Appendix C adjustment. The first part summarizes the rate adjustments proposed in this rule. The second part describes the ratemaking process and explains the formulas used in the methodology to show how the rate adjustment was actually calculated. A. Proposed Pilotage Rate Changes—Summarized This proposed rule would adjust the rates for Federal pilots on the Great Lakes, contained in 46 CFR 401.405, 401.407, and 401.410, in accordance with Appendix C of 46 CFR part 404. Using this methodology, the rate adjustment would result in an average increase of 6 percent across all Districts over the last pilotage rate adjustment. 2006 Area Rate Changes If pilotage service is required in: Then the percentage increases over the current rate is: Area 1 (Designated waters) 5.44 Area 2 (Undesignated waters) 6.30 Area 4 (Undesignated waters) 6.39 Area 5 (Designated waters) 5.65 Area 6 (Undesignated waters) 6.26 Area 7 (Designated waters) 5.50 Area 8 (Undesignated waters) 6.20 Rates for “Cancellation, delay or interruption in rendering services (§ 401.420)” and “Basic rates and charges for carrying a U.S. pilot beyond [the] normal change point, or for boarding at other than the normal boarding point (§ 401.428)” have been increased by 6 percent. These changes are the same in every Area. B. Calculating the Rate Adjustment The ratemaking analyses and methodology contained in Appendix C to 46 CFR part 404 is comprised of eight steps. These steps are: 1. Calculating the Base Period Total Economic Cost (Cost Per Bridge Hour by Area for the Base Period); 2. Calculating the Expense Multiplier; 3. Calculating the Annual Projection of Target Pilot Compensation; 4. Increasing the Projected Pilot Compensation in Step 3 by the Expense Multiplier; 5. Adjusting the Result for Inflation or Deflation; 6. Dividing the Result in Step 5 by Projected Bridge Hours to Determine Total Unit Costs (Adjusted Cost per Bridge Hour by Area); 7. Dividing Prospective Unit Costs (Total Unit Cost) in Step 6 by the Base Period Unit Costs in Step 1; and 8. Adjusting the Base Period rates by the Percentage Changes in Unit Cost in Step 7. The base data used to calculate each of the eight steps comes from the final rule published in the **Federal Register** on April 3, 2006 (71 FR 16501), adjusting pilotage rates on the Great Lakes. 71 FR 16501. The Coast Guard also used the most recent union contracts between the American Maritime Officers' union

(AMO)and vessel owners and operators on the Great Lakes to determine target pilot compensation. Bridge hour projections for the 2006 season have been obtained from historical data, pilots, and industry. Bridge hours are the number of hours a pilot is aboard a vessel providing pilotage service. Some values may not total exactly due to format rounding for presentation in charts and explanations in this section. The rounding does not affect the integrity or truncate the real value of all calculations in the ratemaking methodology described below. *Step 1:* Calculating the Base Period Total Economic Cost (Cost per Bridge Hour by Area for the Base Period). The base period numbers used in all calculations are those that were set by the final rule published in the **Federal Register** on April 3, 2006 (71 FR 16513). The data used for this first step is obtained from the tables containing the base operating expense, base target pilot compensation, and base return element computations. This first step requires that we calculate the total economic cost for the base period by taking from these tables, and adding together, the recognized expenses, the total cost of target pilot compensation, and the return element in each Area. We then take this sum and divide it by the total bridge hours used in each Area in setting the base period rates. This calculation gives us the cost of providing pilotage service per bridge hour by Area for the base period. The following tables summarize the Step 1 computations: Table 1.—Base Period Total Economic Cost (Cost Per Bridge Hour)—District One Area 1 St. Lawrence River Area 2 Lake Ontario Total—District One Base Operating Expenses $368,186 $372,911 $741,097 Base Target Pilot compensation +$1,207,209 +$725,848 +1,933,057 Base Return Element 1 +$8,087 +$10,185 +$18,272 Subtotal =$1,583,482 =$1,108,944 =$2,692,426 Base Bridge Hours ÷6,000 ÷9,000 ÷15,000 Base Cost per Bridge Hour =$263.91 =$123.22 =$179.50 1 The return element is defined at Appendix B to 46 CFR part 404 as the sum of net income and interest expense. The return element can be considered the sum of the return to equity capital (net increase), and the return to debt (the interest expense). Table 2.—Base Period Total Economic Cost (Cost Per Bridge Hour)—District Two Area 4—Lake Erie Area 5—Southeast Shoal to Port Huron, MI Total—District Two Base Operating Expenses $427,333 $632,117 $1,059,450 Base Target Pilot compensation +$725,848 +$1,408,410 +$2,134,258 Base Return Element +$20,354 +$24,275 +$44,629 Subtotal =$1,173,535 =$2,064,802 =$3,238,337 Base Bridge Hours ÷9,000 ÷7,000 ÷16,000 Base Cost per Bridge Hour =$130.39 =$294.97 =$202.40 Table 3.—Base Period Total Economic Cost (Cost Per Bridge Hour)—District Three Area 6—Lakes Huron and Michigan Area 7—St. Mary's River Area 8—Lake Superior Total—District Three Base Operating Expenses $693,924 $271,563 $433,484 $1,398,971 Base Target Pilot compensation +$1,451,696 +$804,806 +$1,016,187 +$3,272,689 Base Return Element +$25,283 +$9,768 +$15,451 +$50,502 Subtotal =$2,170,903 =$1,086,137 =$1,465,122 =$4,722,162 Base Bridge Hours ÷18,000 ÷4,000 ÷12,600 ÷34,600 Base Cost per Bridge Hour =$120.61 =$271.53 =$116.28 =$136.48 *Step 2.* Calculating the Expense Multiplier. The expense multiplier is the ratio of both the base operating expenses and the base return element to the base target pilot compensation by Area. This step requires that we add together the base operating expense and the base return element. Then we divide the sum by the base target pilot compensation to get the expense multiplier for each Area. The following tables show the calculations: 1. Expense Multiplier for District One Area 1—St. Lawrence River Area 2—Lake Ontario Total—District One Base Operating Expense $368,186 $372,911 $741,097 Base Return Element +$8,087 +$10,185 +$18,272 Subtotal =$376,273 =$383,096 =$759,369 Base Target Pilot Compensation ÷$1,207,209 ÷$725,848 ÷$1,933,057 Expense Multiplier =.31169 =.52779 =.39283 2. Expense Multiplier for District Two Area 4—Lake Erie Area 5—Southeast Shoal to Port Huron, MI Total—District Two Base Operating Expense $427,333 $632,117 $1,059,450 Base Return Element +$20,354 +$24,275 +$44,629 Subtotal =$447,687 =$656,392 =$1,104,079 Base Target Pilot Compensation ÷$725,848 ÷$1,408,410 ÷$2,134,258 Expense Multiplier =.61678 =.46605 =.51731 3. Expense Multiplier for District Three Area 6—Lakes Huron and Michigan Area 7—St. Mary's River Area 8—Lake Superior Total—District Three Base Operating Expense $693,924 $271,563 $433,484 $1,398,971 Base Return Element +$25,283 +$9,768 +$15,451 +$50,502 Subtotal =$719,207 =$281,331 =$448,935 =$1,449,473 Base Target Pilot Compensation ÷$1,451,696 ÷$804,806 ÷$1,016,187 ÷$3,272,689 Expense Multiplier =.49543 =.34956 =.44178 =.44290 *Step 3.* Calculating the new annual “projection of target pilot compensation” using the same procedures found in Step 2 of Appendix A to 46 CFR part 404. Step 2 of Appendix A requires the Director of Great Lakes Pilotage to: 1. Determine the new target rate of compensation; 2. Determine the new number of pilots needed in each pilotage Area; and 3. Multiply new target compensation by the new number of pilots needed to project total new target pilot compensation needed in each Area. Each step is detailed as follows: 1. Determination of New Target Pilot Compensation Target pilot compensation for pilots providing services in undesignated waters approximates the average annual compensation for first mates on U.S. Great Lakes vessels. For this notice of proposed rulemaking (NPRM), the average annual compensation for first mates is determined based on the AMO union contract effective August 1, 2005, for wages and benefits received by first mates. Target pilot compensation for pilots providing services in designated waters approximates the average annual compensation for masters on U.S. Great Lakes vessels. It is calculated as 150 percent of the compensation earned by first mates on U.S. Great Lakes vessels. The Office of Great Lakes Pilotage has consistently calculated this by first multiplying the first mates' salary by 150 percent and then adding benefits, since this is the best approximation of the average annual compensation for masters. The following tables (7, 8, and 9) summarize how target pilot compensation is determined for undesignated and designated waters: Table 7.—Wages Monthly component (First mate) pilots on undesignated waters (Master) pilots on designated waters $226.96 (Daily Rate) × 54

(Days)$12,256 N/A Monthly Total × 9 Months = Total Wages $110,303 N/A Wages: $226.96 (Daily Rate) × 54 × 1.5 N/A $18,384 Monthly Total × 9 Months = Total Wages N/A $165,454 Table 8.—Benefits Monthly component (First mate) pilots on undesignated waters (Master) pilots on designated waters Employer Contribution—401(K) Plan $612.79 $919.19 Clerical +$340.44 +$340.44 Health +$2,512.51 +$2,512.51 Pension +$1,283.10 +$1,283.10 Monthly Total Benefits =$4,748.84 =$5,055.24 Monthly Total Benefits × 9 months =$42,740 =$45,497 Table 9.—Wages and Benefits (First mate) pilots on undesignated waters (Master) pilots on designated waters Wages $110,303 $165,454 Benefits +$42,740 +$45,497 Total Wages Plus Benefits =$153,042 =$210,951 The monthly component for wages is derived by multiplying the daily rate of pay by 54 days, instead of 30 days, based upon the following formulation obtained from the AMO union contract: a. Average Working Days per month—30.5 b. Vacation Days per month—15.0 c. Weekend days per month—4.0 d. Holidays per month—1.5 e. Bonus per month—3.0 Monthly Multiplier—54.0 Additionally, we use a nine-month multiplier in computing annual wages and benefits because the season is nine months in duration vice 12 months. Effective August 1, 2002, the matching benefit increased to 50 percent for each participating 401(k) employee up to a maximum of 5 percent of a participating employee's compensation. For purposes of this benefit, the AMO union contracts interpret “employee compensation” to mean base wages. District Two has a pension plan, while District Three has a 401(k) plan. District One does not provide either a 401(k) or pension plan for its members. Therefore, to conform to the 401(k) matching benefit provision under the AMO union contracts, pilot compensation for Districts Two and Three are increased. The increase in undesignated waters is $5,515.20 and for designated waters is $8,272.80 per pilot. These increases are 5 percent of compensation, respectively. District One does not administer any form of 401(k) or retirement plan. At the recommendation of the independent accountant, the Coast Guard has determined that the District One Association pilots should receive the same employer matching benefits as Districts Two and Three. Accordingly, the compensation base of District One is adjusted to include an amount equivalent to an employer's contribution under the AMO 401(k) matching plan, which increases pilot compensation in undesignated waters by $5,515.20 and for designated waters by $8,272.80 per pilot. 2. Determination of New Number of Pilots Needed The number of pilots needed in each Area of designated waters is established by dividing the projected bridge hours for that Area by 1,000. Bridge hours are the number of hours a pilot is aboard a vessel providing pilotage service. The number of pilots needed in each Area of undesignated waters is established by dividing the projected bridge hours for that Area by 1,800. These hours are the target number of bridge hours a pilot needs to earn target pilot compensation. Projected bridge hours are based on the vessel traffic that pilots are expected to serve. The Coast Guard projects that traffic for the 2006 navigation season will remain the same as it did in 2005. As indicated, these projections were made based upon historical data, and all other relevant information provided by pilots and industry. Dividing the projected annual number of bridge hours per Area by the target number of bridge hours per pilot results in the number of pilots that will be needed in each Area to service vessel traffic. The following table, “Number of Pilots Needed,” shows the calculation of the number of pilots needed in each Area for the 2006 navigation season rounded to the next whole pilot: Number of Pilots Needed Pilotage area Projected 2006 bridge hours Divided by bridge-hour target Pilots needed AREA 1 6,000 1,000 6 AREA 2 9,000 1,800 5 AREA 4 9,000 1,800 5 AREA 5 7,000 1,000 7 AREA 6 18,000 1,800 10 AREA 7 4,000 1,000 4 AREA 8 12,600 1,800 7 Total Pilots Needed 44 3. Projection of New Total Target Pilot Compensation The projection of new total target pilot compensation is determined separately for each pilotage Area by multiplying the number of pilots needed in each Area by the target pilot compensation for pilots working in that Area. The results for each pilotage Area are set out as follows: District One Area 1—St. Lawrence River Area 2—Lake Ontario Total—District One Projection of target pilot compensation $1,265,708 $765,212 $2,030,920 District Two Area 4—Lake Erie Area 5—Southeast Shoal to Port Huron, MI Total—District Two Projection of target pilot compensation $765,212 $1,476,660 $2,241,872 District Three Area 6—Lakes Huron and Michigan Area 7—St. Mary's River Area 8—Lake Superior Total—District Three Projection of target pilot compensation $1,530,424 $843,805 $1,071,297 $3,445,526 *Step 4:* Increase the new total target pilot compensation in Step 3 by the expense multiplier in Step 2. The increase in Step 4 refers to the proportional increase of operating expense when new total target pilot compensation is multiplied by the expense multiplier. The calculations for Step 4 appear as follows: District One Area 1—St. Lawrence River Area 2—Lake Ontario Total—District One Pilot Compensation $1,265,708 $765,212 $2,030,920 Expense Multiplier ×.31169 ×.52779 ×.39283 Projected Increase in Operating Expense =$394,506 =$403,872 =$797,813 District Two Area 4—Lake Erie Area 5—Southeast Shoal to Port Huron, MI Total—District Two Pilot Compensation $765,212 $1,476,660 $2,241,872 Expense Multiplier ×.61678 ×.46605 ×.51731 Projected increase in Operating Expense =$471,966 =$688,200 =$1,159,749 District Three Area 6—Lakes Huron and Michigan Area 7—St. Mary's River Area 8—Lake Superior Total—District Three Pilot Compensation $1,530,424 $843,805 $1,071,297 $3,445,526 Expense Multiplier ×.49543 ×.34956 ×.44178 ×.44290 Projected Increase in Operating Expense =$758,211 =$294,964 =$473,282 =$1,526,023 *Step 5(a):* Adjust the result in Step 4, as required, for inflation or deflation. The calculations for Step 5(a) appear below. Inflation rates were obtained from the U.S. Department of Labor, Bureau of Labor Statistics, “Midwest Economy—Consumer Prices,” using the years 2003 to 2004 annual average in the amount of 2.4 percent per year. District One Area 1—St. Lawrence River Area 2—Lake Ontario Total—District One Projected Increase in Operating Expense $394,506 $403,872 $797,813 Inflation Rate ×1.024 ×1.024 ×1.024 Adjusted Projected Increase in Operating Expense =$403,974 =$413,565 =$816,961 District Two Area 4—Lake Erie Area 5—Southeast Shoal to Port Huron, MI Total—District Two Projected Increase in Operating Expense $471,966 $688,200 $1,159,749 Inflation Rate ×1.024 ×1.024 ×1.024 Adjusted Projected Increase in Operating Expense =$483,293 =$704,717 =$1,187,583 District Three Area 6—Lakes Huron and Michigan Area 7—St. Mary's River Area 8—Lake Superior Total—District Three Projected Increase in Operating Expense $758,211 $294,964 $473,282 $1,526,023 Inflation Rate ×1.024 ×1.024 ×1.024 X 1.024 Adjusted Projected Increase in Operating Expense =$776,408 =$302,043 =$484,641 =$1,562,648 *Step 5(b):* Calculate Projected Total Economic Costs. After the inflation adjustments are made to the Operating Expenses in Step 5(a), the adjusted amount (Adjusted Projected Increase in Operating Expense) is added to the New Total Target Pilot Compensation, as determined in Step 3, to arrive at a Projected Total Economic Cost. The Total Economic Cost is necessary in order to determine the Total Unit Cost in Step 6. The calculations for Step 5(b) appear as follows: District One Area 1—St. Lawrence River Area 2—Lake Ontario Total—District One Adjusted Projected Increase in Operating Expense $403,974 $413,565 $816,961 Projected Target Pilot Compensation +$1,265,708 +$765,212 +$2,030,920 Projected Total Economic Cost =$1,669,683 =$1,178,777 =$2,847,881 District Two Area 4—Lake Erie Area 5—Southeast Shoal to Port Huron, MI Total—District Two Adjusted Projected Increase in Operating Expense $483,293 $704,717 $1,187,583 Projected Target Pilot Compensation +$765,212 +$1,476,660 +$2,241,872 Projected Total Economic Cost =$1,248,505 =$2,181,376 =$3,429,454 District Three Area 6—Lakes Huron and Michigan Area 7—St. Mary's River Area 8—Lake Superior Total—District Three Adjusted Projected Increase in Operating Expense $766,408 $302,043 $484,641 $1,562,648 Projected Target Pilot Compensation +$1,530,424 +$843,805 +$1,071,297 +$3,445,526 Projected Total Economic Cost =$2,306,832 =$1,145,848 =$1,555,937 =$5,008,174 *Step 6:* Divide the Result in Step 5(b) by Projected Bridge Hours to Determine Total Unit Costs (Adjusted Cost per Bridge Hour by Area). District One Area 1—St. Lawrence River Area 2—Lake Ontario Total—District One Projected Total Economic Costs $1,669,683 $1,178,777 $2,847,881 Projected Bridge Hours ÷6,000 ÷9,000 ÷15,000 Total Unit Costs =$278.28 =$130.98 =$189.86 District Two Area 4—Lake Erie Area 5—Southeast Shoal to Port Huron, MI Total—District Two Projected Total Economic Costs $1,248,505 $2,181,376 $3,429,454 Projected Bridge Hours ÷9,000 ÷7,000 ÷16,000 Total Unit Costs =$138.72 =$311.63 =$214.34 District Three Area 6—Lakes Huron and Michigan Area 7—St. Mary's River Area 8—Lake Superior Total—District Three Projected Total Economic Costs $2,306,832 $1,145,848 $1,555,937 $5,008,174 Projected Bridge Hours ÷18,000 ÷4,000 ÷12,600 ÷34,600 Total Unit Costs =$128.16 =$286.46 =$123.49 =$144.74 *Step 7:* Divide prospective unit costs in Step 6 by the base period unit costs in Step 1. (This step calculates the percent change in unit cost from the base period to the prospective unit cost.) District One Area 1—St. Lawrence River Area 2—Lake Ontario Total—District One Prospective Unit Cost (Total Unit Cost) $278.28 $130.98 $189.86 Base Period Unit Cost ÷$263.91 ÷$123.22 ÷$179.50 Percentage Change in Unit Cost (Rate Adjustment) =1.0544 =1.0630 =1.0577 District Two Area 4—Lake Erie Area 5—Southeast Shoal to Port Huron, MI Total—District Two Prospective Unit Cost (Total Unit Cost) $138.72 $311.63 $214.34 Base Period Unit Cost ÷$130.39 ÷$294.97 ÷$202.40 Percentage Change in Unit Cost (Rate Adjustment) =1.0639 =1.0565 =1.0590 District Three Area 6—Lakes Huron and Michigan Area 7—St. Mary's River Area 8—Lake Superior Total—District Three Prospective Unit Cost (Total Unit Cost) $128.16 $286.46 $123.49 $144.74 Base Period Unit Cost ÷$120.61 ÷$271.53 ÷$116.28 ÷$136.48 Percentage Change in Unit Cost (Rate Adjustment) =1.0626 =1.0550 =1.0620 =1.0606 *Step 8:* Adjust the base period rates by the percentage change in unit costs in Step 7. The “Percentage Change in Unit Cost” in Step 7 represents the percentage change or rate adjustment that will be applied to existing base period rates and charges in subpart D of 46 CFR part 401. For instance, in Area 1, the Percentage Change in Unit Cost of 1.0544 represents a 5.44 percent rate adjustment over the existing Area 1 rate. The rate adjustments are summarized by Areas in the following table. The actual adjustments are shown in the proposed amendments to regulatory text that follow this preamble. Each of the area rates listed in part 401 has been adjusted according to this table. Results are rounded to nearest whole dollar. 2006 Area Rate Changes If pilotage service is required in: Then the percentage increases over the current rate is: Area 1 (Designated waters) 5.44 Area 2 (Undesignated waters) 6.30 Area 4 (Undesignated waters) 6.39 Area 5 (Designated waters) 5.65 Area 6 (Undesignated waters) 6.26 Area 7 (Designated waters) 5.50 Area 8 (Undesignated waters) 6.20 IV. Regulatory Evaluation Executive Order 12866, “Regulatory Planning and Review,” 58 FR 51735, October 4, 1993, requires a determination whether a regulatory action is “significant” and therefore subject to review by the Office of Management and Budget

(OMB)and subject to the requirements of the Executive Order. This rulemaking is not significant under Executive Order 12866 and has not been reviewed by OMB. The Coast Guard is required to conduct an annual review of pilotage rates on the Great Lakes and, if necessary, adjust these rates to align compensation levels between Great Lakes pilots and industry. (See the “Purpose of the Proposed Rule” section for a detailed explanation of the legal authority and requirements for the Coast Guard to conduct an annual review and provide possible adjustments of pilotage rates on the Great Lakes.) Based on our review, we are adjusting the pilotage rates for the 2006 shipping season to generate sufficient revenue to cover allowable expenses, target pilot compensation, and returns on investment. This proposed rule would provide an additional six percent average rate adjustment for the Great Lakes system over the rate adjustment found in the 2005 final rule. This proposed increase is the result of adjustments for inflation, target pilot compensation, and operating expenses of the pilot associations. These adjustments to Great Lakes pilotage rates meet the requirements set forth in 46 CFR part 404 for similar compensation levels between Great Lakes pilots and industry. They also include adjustments for inflation and changes in association expenses to maintain these compensation levels. The increase in pilotage rates will be an additional cost for shippers to transit the Great Lakes system. This proposed rule would result in a distributional effect that transfers payments (income) from vessel owners and operators to the Great Lakes' pilot associations through Coast Guard regulated pilotage rates. The shippers affected by these rate adjustments are those owners and operators of domestic vessels operating on register (employed in the foreign trade) and owners and operators of foreign vessels on a route within the Great Lakes system. These owners and operators must have pilots or pilotage service as required by 46 U.S.C. 9302. There is no minimum tonnage limit or exemption for these vessels. However, the Coast Guard issued a policy position several years ago stating that the statute applies only to commercial vessels and not to recreational vessels. Owners and operators of other vessels that are not affected by this proposed rule, such as recreational boats and vessels only operating within the Great Lakes system, may elect to purchase pilotage services. However, this election is voluntary and does not affect the Coast Guard's calculation of the rate increase and is not a part of our estimated national cost to shippers. We reviewed a sample of pilot source forms, which are the forms used to record pilotage transactions on vessels, and discovered very few cases of U.S. Great Lakes vessels (i.e., domestic vessels without registry operating only in the Great Lakes) that purchased pilotage services. There was one case where the vessel operator purchased pilotage service in District One to presumably leave the Great Lakes system. We assume some vessel owners and operators may also choose to purchase pilotage services if their vessels are carrying hazardous substances or were navigating the Great Lakes system with inexperienced personnel. Based on information from the Coast Guard Office of Great Lakes Pilotage, we have determined that these vessels voluntarily chose to use pilots and, therefore, are exempt from pilotage requirements. We used 2003 arrival data from the Coast Guard's National Vessel Movement Center

(NVMC)to estimate the annual number of vessels affected by the rate adjustment to be 214 vessels that, for some, make several journeys or trips into the Great Lakes system. These vessels entered the Great Lakes by transiting through or in part of at least one of the three pilotage Districts before leaving the Great Lakes system. These vessels often make several distinct stops docking, offloading, and onloading at facilities in Great Lakes ports. Of the total trips for the 214 vessels, there were approximately 1,090 U.S. port arrivals before the vessels left the Great Lakes system, based on 2003 vessel arrival data from the NVMC. We used district pilotage revenues from the independent accountant's reports of the Districts' financial statements to estimate the additional cost to shippers of the rate adjustments in this proposed rule. These revenues represent the direct and indirect pilotage costs that shippers must pay for pilotage services in order to transit their vessels in the Great Lakes. Table 1 shows historical pilotage revenues by District. Table 1.—District Revenues ($U.S.) Year District One District Two District Three Total 1998 2,127,577 3,202,374 4,026,802 9,356,753 1999 2,009,180 2,727,688 3,599,993 8,336,861 2000 1,890,779 2,947,798 4,036,354 8,874,931 2001 1,676,578 2,375,779 3,657,756 7,710,113 2002 1,686,655 2,089,348 3,460,560 7,236,563 Source: Annual independent accountant's reports of the Districts to the Coast Guard's Office of Great Lake Pilotage. While the revenues have decreased over time, the Coast Guard adjusts pilotage rates to achieve a target pilot compensation similar to masters and first mates working on U.S. vessels engaged in the Great Lakes trade. We estimate the additional cost of the rate adjustment in this proposed rule to be the difference between the total adjusted revenue based on the 2005 rate adjustment and the proposed rate adjustment (change) revenue in this proposed rule. These revenue values and adjustments are described and calculated in the “Calculating the Rate Adjustment” section of this rulemaking. The projected revenue uses the 2002 revenues in Table 1 adjusted for the 2005 final rule and the proposed adjustments for inflation, wages, and 401(k) contributions from this proposed rule. Table 2 compares projected and adjusted revenues and costs of the proposed rule to industry by district. Table 2.—Revenues, Rate Adjustment Factors and Additional Cost of the Rulemaking ($U.S.) 1 District District One District Two District Three Total 2 Base Revenue 1 1,686,655 2,089,348 3,460,560 7,236,563 Total Adjusted Revenue 3 2,643,732 3,125,036 4,722,162 10,490,930 Proposed Rate Change 4 1.0577 1.059 1.0606 1.0594 Revenue Needed 5 2,796,275 3,309,413 5,008,325 11,114,013 Additional Revenue or Cost of this Rulemaking 6 152,543 184,377 286,163 623,083 1 Base revenue is from the 2002 base accounting year data. 2 Some values may not total due to rounding. 3 Total adjusted revenue = ‘2002 base revenue’ + ‘2005 final rule rate adjustment revenue’. 4 See step 7 of the “Calculating the Rate Adjustment” section of this proposed rule. We used the districts' percent change in unit costs for the rate change. 5 Revenue needed = ‘total adjusted revenue’ × ‘proposed rate change’. 6 Additional revenue or cost of this proposed rule = ‘revenue needed’—‘total adjusted revenue’. After applying the rate change in this proposed rule, the resulting difference between the revenue projected and the revenue needed is the annual cost for the affected population of this proposed rule. This figure will be equivalent to the total additional payments that shippers will make for pilotage services from this proposed rule. The annual cost of the rate adjustment in this proposed rule to shippers is approximately $623,083 (non-discounted). To calculate an exact cost per vessel is difficult because of the variation in vessel types, routes, port arrivals, commodity carriage, time of season, conditions during navigation, and preferences for the extent of pilotage services on designated and undesignated portions of the Great Lakes system. Some owners and operators will pay more and some will pay less depending on the distance and port arrivals of their vessels' trips. However, the annual cost reported above does capture all of the additional cost the shippers would face as a result of the rate adjustment in this proposed rule. We estimated the total cost to shippers of the rate adjustments in this proposed rule over a five-year period, because the Coast Guard is required to determine and, if necessary, adjust Great Lakes pilotage rates at a minimum of at least once every five years from the 2005 rate adjustment. However, the Coast Guard does evaluate and analyze the Great Lakes pilotage rates every year, regardless of whether an adjustment is needed or not. The total five-year (2006-2010) present value cost estimate of this rulemaking to shippers is $2.7 million discounted at a seven percent discount rate and $2.9 million discounted at a three percent discount rate. The cost to shippers of this proposed rule is minimal compared with the travel cost shippers save when they use the Great Lakes system. The alternative to Great Lakes waterborne transportation is to choose coastal delivery, such as East Coast and Gulf Coast ports that are more expensive, and extra-modal transportation overland, which is far less practical and has additional transportation costs for all commodity groups. See Coast Guard docket number USCG-2006-24414 for an assessment of alternatives to Great Lakes waterborne transportation and the associated costs entitled “Analysis of Great Lakes Pilotage Costs on Great Lakes Shipping and the Potential Impact of Pilotage Rate Increases” (October 1, 2004). A. Small Entities Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. In 2003, most vessels engaged in foreign trade on the Great Lakes were large foreign-owned shipping conglomerates. There were two U.S. companies that were operating vessels engaged in foreign trade in the Great Lakes system that would be affected by the rate adjustments in this proposed rule and pay additional costs for pilotage services. However, these two companies are subsidiaries of large foreign parent entities. The North American Industry Classification System (NAICS) code subsector for these shippers is 483—Water Transportation, and includes one or all of the following 6-digit NAICS codes for freight transportation: 483111—Deep Sea Freight Transportation, 483113—Coastal and Great Lakes Freight Transportation, and 483211—Inland Water Freight Transportation. According to the Small Business Administration's definition, a U.S. company with these NAICS codes and employing less than 500 employees is considered a small entity. These large foreign-owned shippers do not qualify as small entities because their number of employees exceeds 500. We assume that new industry entrants will be comparable in size to these shippers with a large enough employee base and the financial resources to support long international trade routes and, thus, will not be small businesses. There are three U.S. entities that are affected by the proposed rule that will receive the additional revenues from the proposed rate adjustment. These are the three pilot associations that are the only entities providing pilotage services within the Great Lakes districts. Two of the associations operate as partnerships and one operates as a corporation. These associations are classified with the same NAICS industry classification and small entity size standards as the U.S. shippers above, but they have far fewer than 500 employees: approximately 65 total employees combined. However, they are not adversely impacted with the additional costs of the proposed rate adjustments, but instead receive the additional revenue benefits for operating expenses and pilot compensation. Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of U.S. small entities. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment to the Docket Management Facility at the address under ADDRESSES . In your comment, explain why you think it qualifies and how and to what degree this rule would economically affect it. B. Assistance for Small Entities Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we offered to assist small entities in understanding the proposed rule so that they could better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please call Paul Wasserman, Director, Office of Great Lakes Pilotage, (G-PWM-2), U.S. Coast Guard, telephone 202-372-1535 or send him e-mail at *pwasserman@comdt.uscg.mil.* Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). C. Collection of Information Under the Paperwork Reduction Act (44 U.S.C. 3501-3520), the Office of Management and Budget

(OMB)reviews each proposed rule that contains a collection of information requirement to determine whether the practical value of the information is worth the burden imposed by its collection. Collection of information requirements include reporting, record keeping, notification, and other similar requirements. This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). This proposed rule would not change the burden in the collection currently approved by the Office of Management and Budget

(OMB)under OMB Control Number 1625-0086, Great Lakes Pilotage Methodology. D. Federalism A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism because there are no similar State regulations, and the States do not have the authority to regulate and adjust rates for pilotage services in the Great Lakes system. E. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such expenditure, we do discuss the effects of this rule elsewhere in this preamble. F. Taking of Private Property This proposed rule would not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. G. Civil Justice Reform This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. H. Protection of Children We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children. I. Indian Tribal Governments This proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. J. Energy Effects We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211. K. Technical Standards The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( *e.g.* , specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies. This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards. L. Environment We have analyzed this proposed rule under Commandant Instruction M16475.lD and Department of Homeland Security Management Directive 5100.1, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969

(NEPA)(42 U.S.C. 4321-4370f), and have made a preliminary determination that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, we believe that this rule should be categorically excluded, under figure 2-1, paragraph (34)(a), of the Instruction, from further environmental documentation. Paragraph 34(a) pertains to minor regulatory changes that are editorial or procedural in nature. This NPRM proposes rate adjustments in accordance with applicable statutory and regulatory mandates. A preliminary “Environmental Analysis Check List” is available in the docket where indicated under the “Public Participation and Request for Comments” section of this preamble. Comments on this section will be considered before we make the final decision on whether this rule should be categorically excluded from further environmental review. List of Subjects in 46 CFR Part 401 Administrative practice and procedure, Great Lakes, Navigation (water), Penalties, Reporting and recordkeeping requirements, Seamen. For the reasons discussed in the preamble, the Coast Guard proposes to amend 46 CFR part 401 as follows: PART 401—GREAT LAKES PILOTAGE REGULATIONS 1. The authority citation for part 401 continues to read as follows: Authority: 46 U.S.C. 2104(a), 6101, 7701, 8105, 9303, 9304; Department of Homeland Security Delegation No. 0170.1 46 CFR 401.105 also issued under the authority of 44 U.S.C. 3507. 2. In § 401.405, revise paragraphs

(a)and (b), including the footnote to Table (a), to read as follows: § 401.405 Basic rates and charges on the St. Lawrence River and Lake Ontario. Area 1 (Designated Waters): Service St. Lawrence River Basic Pilotage 1 $12 per Kilometer or $20 per mile. Each Lock Transited 1 251. Harbor Movage 1 821. 1 The minimum basic rate for assignment of a pilot in the St. Lawrence River is $548, and the maximum basic rate for a through trip is $2,405.

(b)Area 2 (Undesignated Waters): Service Lake Ontario Six-Hour Period $391 Docking or Undocking 373 3. In § 401.407, revise paragraphs

(a)and (b), including the footnote to Table (b), to read as follows: § 401.407 Basic rates and charges on Lake Erie and the navigable waters from Southeast Shoal to Port Huron, MI.

(a)Area 4 (Undesignated Waters): Service Lake Erie (East of Southeast Shoal) Buffalo Six-Hour Period $559 $559 Docking or Undocking 431 431 Any Point on the Niagara River below the Black Rock Lock N/A 1,099

(b)Area 5 (Designated Waters): Any point on or in Southeast Shoal Toledo or any Point on Lake Erie west of Southeast Shoal Detroit River Detroit Pilot Boat St. Clair River Toledo or any port on Lake Erie west of Southeast Shoal $1,433 $846 $1,859 $1,433 N/A Port Huron Change Point 1 2,494 1 2,890 1,874 1,458 1,036 St. Clair River 1 2,494 N/A 1,874 1,874 846 Detroit or Windsor Or the Detroit River 1,433 1,859 846 N/A 1,874 Detroit Pilot Boat 1,036 1,433 N/A N/A 1,874 1 When pilots are not changed at the Detroit Pilot Boat. 4. In § 401.410, revise paragraphs (a), (b), and

(c)to read as follows: § 401.410 Basic rates and charges on Lakes Huron, Michigan, and Superior, and the St. Mary's River.

(a)Area 6 (Undesignated Waters): Service Lakes Huron and Michigan Six-Hour Period $443 Docking or Undocking 421

(b)Area 7 (Designated Waters): Area De Tour Gros Cap Any Harbor Gros Cap $1,532 N/A N/A Algoma Steel Corporation Wharf at Sault Ste. Marie Ontario 1,532 577 N/A Any point in Sault Ste. Marie, Ontario, except the Algoma Steel Corporation Wharf 1,284 577 N/A Sault Ste. Marie, MI 1,284 577 N/A Harbor Movage N/A N/A 577

(c)Area 8 (Undesignated Waters): Service Lake Superior Six-Hour Period $388 Docking or Undocking 369 § 401.420 [Amended] 5. In § 401.420— a. In paragraph (a), remove the number “$70” and add, in its place, the number “$74”; and remove the number “$1,100” and add, in its place, the number “$1,166”. b. In paragraph (b), remove the number “$70” and add, in its place, the number “$74”; and remove the number “$1,100” and add, in its place, the number “$1,166”. c. In paragraph (c)(1), remove the number “$416” and add, in its place, the number “$441”; in paragraph (c)(3), remove the number “$70” and add, in its place, the number “$74”; and, also in paragraph (c)(3), remove the number “$1,100” and add, in its place, the number “$1,166”. § 401.428 [Amended] 6. In § 401.428, remove the number “$424” and add, in its place, the number “$449”. Dated: May 30, 2006. C.E. Bone, Rear Admiral, U.S. Coast Guard, Assistant Commandant for Prevention. [FR Doc. E6-11062 Filed 7-12-06; 8:45 am] BILLING CODE 4910-15-P DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 300 [Docket No. 060621174-6174-01; I.D. 022106C] RIN 0648-AS75 Antarctic Marine Living Resources (AMLR); Centralized Vessel Monitoring System; Preapproval of Fresh Toothfish Imports; Customs Entry Number; Electronic Catch Documentation Scheme; Scientific Observers; Definitions; Seal Excluder Device; Information on Harvesting Vessels AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce. ACTION: Proposed rule; request for comments. SUMMARY: The proposed rule would implement measures adopted by the Commission for the Conservation of Antarctic Marine Living Resources (CCAMLR) to facilitate conservation and management of AMLR. The proposed rule would require the use of the Centralized satellite-linked vessel monitoring system by all U.S. vessels harvesting AMLR and would be a condition of import for all U.S. dealers seeking to import shipments of toothfish ( *Dissostichus* ) into the United States. This proposed rule would also exempt all shipments of fresh toothfish from the NMFS preapproval process and allow importers of frozen toothfish to submit the U.S. Customs 7501 entry number subsequent to their initial application for preapproval. The proposed rule would require the use of Electronic Catch Documents, after a 60-day transition period, for all U.S. dealers seeking to import shipments of toothfish into the United States. Paper-based catch documents for toothfish would no longer be accepted. The proposed rule would also require the use of a seal excluder device on krill vessels using trawl gear in the Area of the Convention for the Conservation of Antarctic Marine Living Resources (Convention Area). The proposed rule would add or amend definitions of “Antarctic marine living resources”, “export”, “import”, “international observer”, “land or landing”, “mobile transceiver unit”, “national observer”, “Office for Law Enforcement (OLE)”, “Port State”, “re-export”, “seal excluder device”, “transship or transshipment”, and “vessel monitoring system (VMS)”. The proposed rule would also expand the list of requirements and prohibitions regarding scientific observers and clarify the duties and responsibilities of the observers on the vessels and of the vessel owners hosting the observers. The proposed rule identifies new information on all vessels licensed by CCAMLR Members to harvest AMLR in the area identified in the Convention on the Conservation of Antarctic Marine Living Resources (Convention). The intent of this rule is to incorporate new conservation measures, to revise procedures to facilitate enforcement, and to fulfill U.S. agreements in CCAMLR. DATES: Comments must be received at the appropriate address (see ADDRESSES ) no later than 5 p.m., eastern standard time, on August 14, 2006. ADDRESSES: Comments on the proposed rule should be addressed to Robin Tuttle, NMFS, 1315 East-West Highway, Silver Spring, MD 20910, by any of the following methods: • E-mail: *0648-AS75.AMLR@noaa.gov* . Include in the subject line the following identifier: “AMLR proposed rule.” E-mail comments, with or without attachments, are limited to 5 megabytes; • Federal e-Rulemaking Portal: *http://www.regulations.gov* ; • Mail to: Robin Tuttle, NMFS - S&T, 1315 East-West Highway, Silver Spring, MD 20910; • Fax to: Robin Tuttle at 301-713-4137; or • Hand Delivery to Robin Tuttle, Rm. 12350, 1315 East-West Highway, Silver Spring, MD 20910. Copies of the Regulatory Impact Review/Initial Regulatory Flexibility Analysis (RIR/IRFA) prepared for this action and the Draft Programmatic Environmental Impact Statement may be obtained from the mailing address above or by calling Robin Tuttle (see FOR FURTHER INFORMATION CONTACT ). Send comments regarding the burden-hour estimates or other aspects of the collection-of-information requirements contained in this proposed rule to Robin Tuttle at the address specified above and also to the Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), Washington, DC 20503 (Attention: NOAA Desk Officer) or e-mail to *David_Rosker@ob.eop.gov* , or fax to

(202)395-7825. FOR FURTHER INFORMATION CONTACT: Robin Tuttle at 301-713-2282 ext. 199, fax 301-713-4137, or *robin.tuttle@noaa.gov* . SUPPLEMENTARY INFORMATION: Electronic Access This **Federal Register** document is also accessible via the Internet at the Office of the **Federal Register** 's Web site at *http://www.access.gpo.gov/su-docs/aces/aces140.html.* Background Antarctic fisheries are managed under the authority of the Antarctic Marine Living Resources Convention Act of 1984

(Act)codified at 16 U.S.C. 2431 *et seq.* NMFS implements conservation measures developed by CCAMLR and adopted by the United States, through regulations at 50 CFR part 300, subpart G. Changes to the existing regulations are necessary to incorporate new conservation measures and to revise procedures to facilitate enforcement of new and existing conservation measures. Centralized VMS Based upon the results of a trial conducted by some Contracting Parties to CCAMLR during the 2003/2004 fishing season, CCAMLR revised the requirements for its automated satellite-linked vessel monitoring system (VMS), first implemented in 1999, and adopted Conservation Measure 10-04 implementing a Centralized VMS (C-VMS). Prior to the adoption of C-VMS, CCAMLR required that each Contracting Party ensure that its fishing vessels were equipped with a satellite-linked vessel monitoring device allowing for the continuous reporting of their position in the Convention Area for the duration of the license issued by the Contracting Party. The vessel monitoring device was required to automatically communicate at least every 4 hours to the land-based fisheries monitoring center of the Flag State of the vessel. With the adoption of C-VMS, CCAMLR now requires that all vessels, fishing in CCAMLR-managed waters use a VMS that automatically transmits the vessel's position at least every 4 hours to a land-based fisheries monitoring center of its Flag State. Previously only movement into or out of the Convention Area, not position, was required to be reported. Each Contracting Party to the Convention must forward the VMS reports and messages received to the CCAMLR Secretariat as soon as possible, but not later than 4 hours after receipt for exploratory longline fisheries or following departure from the Convention Area for all other fisheries. If the Contracting Party so desires, it can ensure that each of its vessels communicates its VMS reports and messages in parallel directly to the Secretariat. The CCAMLR Secretariat shall treat all VMS reports and messages received in a confidential manner in accordance with the confidentiality rules established by the Commission. The conservation measure requires the CCAMLR Secretariat to place a list of vessels submitting VMS reports on a password-protected section of the CCAMLR website. The list will be divided into subareas and divisions, without indicating the exact position of vessels. This information can be used by Catch Document Scheme

(CDS)officers of Contracting Parties to verify information claimed on a Dissostichus Catch Document (DCD). A Contracting Party may request actual VMS data reports and messages from the Secretariat for use in verifying DCD information in more detail. However, this data can only be released with the permission of the Flag State of the vessel. Only in the case of active surveillance and/or inspection can the Secretariat provide actual VMS data and/or messages to a Contracting Party without the consent of the Flag State of the vessel. The conservation measure also requires the CCAMLR Secretariat to transmit VMS data and reports using secure Internet protocols Secure Socket Layer (SSL), (Data Encryption Standard (DES)) or verified certificates obtained from the Secretariat. These protocols are similar to those in use by the Northwest Atlantic Fisheries Organization (NAFO). CCAMLR adopted these measures as a means of managing fishing within the Convention Area with greater certainty and making it more difficult, in particular, for illegal, unregulated and unreported

(IUU)fishing in the Convention Area to be misreported as catch from outside the Convention Area. CCAMLR agreed that its CCAMLR System of Inspection could be improved by obtaining positional information including movements by vessels into and out of the Convention Area and CCAMLR statistical areas, in as close to real time as possible. CCAMLR also noted that positional information on movements would enable Contracting Parties to deploy CCAMLR inspectors in the Convention Area and to use available inspection potential in the most effective way. Moreover, CCAMLR noted that the C-VMS conservation measure would facilitate the work of the CCAMLR Secretariat on fisheries management by allowing it to monitor start/end dates of fishing by individual vessels and the catch reports submitted by statistical areas and fisheries. The proposed rule would require the use of a NMFS approved VMS unit reporting through the newly implemented C-VMS by all U.S. vessels harvesting AMLR. The use of a VMS unit would be required from the time a vessel leaves any port until its return to any port. The proposed rule would also require any U.S. dealer seeking to import toothfish into the United States through the preapproval process to have documentation that indicates that the toothfish was harvested by a vessel using C-VMS regardless of where the vessel caught the toothfish. All imports of toothfish or toothfish products would have to be accompanied by verifiable information available to the CDS Officer from the Secretariat documenting the use of C-VMS. U.S. dealers seeking to import toothfish or toothfish products originating from small artisinal boats fishing in the Exclusive Economics Zones

(EEZ)of Peru or Chile would not have to possess information documenting the use of C-VMS by such artisinal boats. NMFS exempts such dealers because of the small size of these artisinal boats and their inability to navigate beyond the EEZ. Dealer Permits and Preapproval NMFS implemented the CCAMLR Catch Documentation Scheme

(CDS)for toothfish in May 2000. In 2003, NMFS implemented a preapproval system applicable to all shipments of frozen toothfish and to shipments of fresh toothfish over 2,000 kilograms (kg). Preapproval streamlines administration of the toothfish import control program and enhances efforts to prevent the importation of illegally harvested toothfish. Preapproval improves the ability of toothfish importers and dealers to quickly move a fresh and, therefore, perishable toothfish product into the country. With the 15 day advance notification of a toothfish shipment required under the preapproval system, U.S. importers of toothfish have a higher degree of assurance that shipments of toothfish will be approved for entry into the United States before the fish arrives at port. Prior to the adoption by NMFS of the preapproval system, importers of toothfish were at risk of denial or seizure of toothfish shipments because DCDs could not be verified and validated by NMFS until after a shipment had been paid for and shipped. Under the preapproval system, the verification and validation of a toothfish shipment is undertaken by NMFS in advance of its entry into the United States. Thus, preapproval enhances economic certainty for U.S. businesses associated with the toothfish trade by giving U.S. dealers an approval to import toothfish before the shipment of toothfish and sometimes even before dealers make a financial investment in the toothfish shipment. Preapproval also facilitates NMFS enforcement efforts by allowing the NMFS program manager/CDS officer to review the DCD for each toothfish shipment prior to its arrival at port and to coordinate, when necessary, with a NMFS enforcement officer. If a shipment of toothfish is suspected of having been harvested or documented illegally, the fifteen-day preapproval review period makes it possible for NMFS to seize the shipment before it enters trade. Prior to adoption of the preapproval system, preemptive enforcement was difficult if not impossible because a suspect shipment of toothfish had already entered the marketplace before possible infractions could be identified. The proposed rule would:

(1)allow additional time within which dealers must supply the U.S. Customs 7501 number: and

(2)exempt all shipments of fresh toothfish from the requirement for preapproval. Currently, after receiving an Antarctic Marine Living Resources

(AMLR)dealer permit but at least 15 business days prior to an expected import, the dealer seeking to import frozen toothfish or fresh toothfish in quantities greater than 2,000 kg, is required to submit to NMFS the DCD that will accompany each anticipated toothfish shipment as well as an “Application for Preapproval of Catch Documents” requesting preapproval to allow import of the toothfish shipment. NMFS requires a dealer to include on the application form for a specific toothfish shipment information regarding the shipment's estimated date of arrival, port of arrival, consignee(s) of product, DCD document number, Flag State confirmation number, export reference number, amount to be imported, and the U.S. Customs 7501 number (sometimes referred to as the “Entry” number). This 7501 number is an identifying number assigned to a particular shipment by a U.S. Customs broker. The dealer is required to fax or express mail the documentation described above, along with a check for the required fee, so that NMFS receives it at least 15 business days prior to the anticipated date of import. However, some dealers have difficulty obtaining a U.S. Customs 7501 number 15 days in advance of a shipment's arrival. The difficulty arises because Customs brokers have limitations on how soon they can assign the 7501 number to a pending shipment and most often, have difficulty assigning it 15 days in advance of the shipment's arrival. For this reason, NMFS is proposing to revise the “Application for Preapproval of Catch Documents” form specifically in regards to the requirement for the 7501 number. NMFS is proposing that dealers supply the 7501 number within 3 working days of a toothfish shipment's arrival. All other information on the “Application for Preapproval of Catch Documents” would remain unchanged. Due to the extremely quick turnaround time required for shipments of fresh toothfish in quantities of less than 2,000 kg, the “Application for Preapproval of Catch Documents” is currently required to be submitted to NMFS within 24 hours of the import of a toothfish shipment, rather than fifteen days in advance of the shipment. The proposed rule would allow for submission of an application for preapproval within 24 hours of import for shipments of fresh toothfish over 2,000 kgs as well. The number of shipments of fresh toothfish over 2000 kg are small. These shipments are typically harvested by the artisinal fishery of Chile and have historically not been the cause for enforcement concern. The infractions common to large shipments of frozen toothfish do not occur with small shipments of fresh toothfish. One common infraction results when legally and illegally harvested toothfish are frozen and combined in one shipment and exported with a single “legal” DCD. Large shipments of frozen toothfish might also include fish illegally harvested in a CCAMLR restricted area and claimed to have been harvested in an EEZ or on the high seas. As artisinal boats harvesting and shipping small amounts of fresh fish are not equipped to reach these CCAMLR restricted areas, they are not suspected of this type of infraction. Pursuant to a bilateral agreement with Chile, NMFS has a real time verification process for shipments of toothfish harvested by Chile's artisinal toothfish fishery. Under the proposed rule, DCDs for shipments of fresh toothfish from Chile would be reviewed without a fee-for-service charge. Shipments of all frozen toothfish including those in quantities of less than 2,000 kg would still require preapproval. NMFS regulations at 50 CFR 300.107(c)(6) and 300. 114 regarding the re-export of toothfish would not be revised. The revised DCD, revised NMFS application for an annual AMLR dealer permit, and the new NMFS application for preapproval referenced under this section are available from NMFS (see ADDRESSES ). Electronic Catch Documents In October 2004, CCAMLR adopted a resolution noting the successful completion of the electronic toothfish document trial and urging CCAMLR Contracting and Non-Contracting Parties to adopt the electronic format as a matter of priority. The electronic system, by means of internal checks, does not allow a country's CDS officer to incorrectly complete a DCD. Requiring U.S. importers of toothfish to use the electronic format would, thus, eliminate the submission of paper-based catch documents incorrectly completed by Flag States, Exporting States, Importing States and Re-exporting States. Paper documents can be difficult to obtain in a timely manner. As a result, in these cases, an incentive exists to submit a fraudulent paper-based DCD to expedite a shipment. The electronic system, by requiring electronic DCDs, eliminates the incentive. The proposed rule would require U.S. dealers importing toothfish into the United States to use the electronic format. Once the proposed rule goes into effect, NMFS will only accept electronic catch documents and will no longer accept paper catch documents for toothfish shipments. In order to allow U.S. dealers sufficient time to comply with these changes, NMFS would not require the use of electronic documents until 60 days after publication of the final rule. Scientific Observers CCAMLR adopted a Scheme of International Scientific Observation in 1992 at its eleventh annual meeting. Observers placed on board fishing vessels pursuant to the scheme observe and report on the operations of fishing activities and their effects on target and associated species of living marine resources. Observers undertake tasks and record their observations pursuant to protocols and using formats approved by the CCAMLR Scientific Committee. These tasks include recording details of vessel operation; taking catch samples; recording biological data by species caught; recording bycatch; recording entanglement and incidental mortality of birds and mammals; recording procedures by which declared catch weight is measured; collecting and reporting factual data on sightings of fishing vessels in the Convention Area, including vessel type identification, position and activity; and collecting information on lost fishing gear and garbage disposal by fishing vessels at sea. CCAMLR has identified two types of observers, collectively known as scientific observers, who may collect information required in CCAMLR-managed fisheries. They are described in the text of the CCAMLR Scheme of International Scientific Observation and referred to in CCAMLR conservation measures requiring scientific observers. The first type of scientific observers referred to by CCAMLR are “national observers.” “National observers” are nationals of the Member designating them who operate on board a fishing vessel of that Member and conduct themselves in accordance with national regulations and standards. The second type of scientific observers are referred to by CCAMLR as “observers appointed in accordance with the CCAMLR Scheme of International Scientific Observation” or referred to by NMFS as “international observers.” International observers” are observers operating in accordance with bilateral arrangements between the Member whose vessel is fishing (the Receiving Member) and the Member providing the observer (the Designating Member). The CCAMLR scheme identifies the elements that must be included in a bilateral arrangement. The U.S. Department of State negotiates bilateral arrangements placing U.S. nationals as observers on non-U.S. Member vessels and receiving non-U.S. Member nationals as observers on U.S. vessels. CCAMLR conservation measures require all fishing vessels operating in the Convention Area (except for vessels fishing for krill) to carry on board, throughout all fishing activities within the fishing period, at least one international observer and, where possible, one additional scientific observer, either a national observer or an international observer. In certain exploratory toothfish fisheries, the vessel must carry at least two observers, one of whom must be an international observer. NMFS regulations, however, only require that each vessel participating in an exploratory fishery carry one scientific observer (see 50 CFR 300.106(c)). In Subareas 88.1, 88.2 and 88.6 and Divisions 58.4.1 and 58.4.2, where exemptions are allowed for setting longlines during daylight hours, two scientific observers are required, one of which must be an international observer. NMFS has not published regulations implementing the CCAMLR Scheme of International Scientific Observation. NMFS has, by **Federal Register** notice, published the annual conservation and management measures adopted by CCAMLR, (including requirements in these measures for scientific observers) for Convention Area fisheries. Additionally, on a case-by-case basis, NMFS has required, as a condition of a vessel's Antarctic Marine Living Resources

(AMLR)harvesting permit, that the vessel carry scientific observers in the Convention Area throughout all fishing activities within the fishing period. Several observers have been placed pursuant to bilateral arrangements negotiated by the Department of State with Japan, South Africa and Ukraine. Others have been U.S. nationals. NMFS coordinates with the vessel permit holders and the observers in all instances to ensure that observers are fully trained in their duties to record the observations required by CCAMLR. For a vessel to fish longline gear during daylight hours, CCAMLR Conservation Measure 24-02 requires longline testing trials prior to entering the Convention Area. Vessels choosing not to conduct the testing trials are restricted by CCAMLR Conservation Measure 25-02 to longline fishing at night. Nighttime fishing is one technique for minimizing the incidental mortality of seabirds in the course of longline fishing. Another technique to minimize incidental mortality is the use of weighted longlines. Conservation Measure 24-02 identifies two protocols for monitoring the sink rate of weighted longlines. The more rapidly a weighted line sinks the less likely there is to be seabird interaction, and possible entanglement, with the lines. NMFS regulations do not presently require on board scientific observers during line weight testing. The proposed rule would require that all U.S. vessels fishing in the Convention Area, including vessels fishing for krill, and all U.S. vessels conducting longline testing outside the Convention Area prior to longline fishing within the Convention Area, carry one or more scientific observers. The proposed rule would specify the process for placing national observers on U.S. vessels harvesting AMLR; the duties and responsibilities of the observers on the vessels; and the duties and responsibilities of the vessel owners hosting the observers. International observers placed pursuant to a bilateral arrangement negotiated by the U.S. Department of State would also be subject to the provisions of the proposed rule. The proposed rule would expand the list of prohibitions to make it unlawful to assault, resist, oppose, impede, intimidate, sexually harass, bribe or interfere with an observer. Seal Excluder Device CCAMLR's Scientific Committee recommended several seal bycatch mitigation measures to CCAMLR in 2004. These were that:

(1)information on all seal excluder devices be combined and circulated to CCAMLR Members and other interested parties;

(2)every vessel fishing for krill employ a device for excluding seals by facilitating their escape from the trawl net;

(3)observers be required on krill vessels to collect reliable data on seal entrapment and on the effectiveness of mitigation devices;

(4)data forms be completed accurately, consistently and comprehensively by all observers; and

(5)the United Kingdom should be requested to submit its observer data to the CCAMLR Secretariat. During the 2004/2005 fishing season, scientific observer reports were available from three vessels voluntarily using seal excluder devices while trawling for krill. One of these vessels was a U.S. vessel. The reports indicated that in Area 48, 95 Antarctic fur seals were observed caught during krill fishing operations, of which 74 were released alive, compared to 156 of which 12 were released alive in the 2003/2004 season. The proposed rule would require seal excluder devices on all U.S. vessels trawling for krill in Convention Area fisheries. Definitions The proposed rule defines terms used in the implementation of the CDS; the designation and placement of scientific observers on vessels fishing in the CCAMLR Convention Area; the mitigation of seal bycatch; and the operation of CCAMLR's automated and centralized satellite-linked VMS. The proposed rule would define or redefine the terms “export”, ldquo;import”, “land or landing”, “Port State”, “re-export”, and “transship” as used by NMFS in implementing the CDS. “Export” would be defined as any movement of a catch in its harvested or processed form from the territory under the control of the State or free trade zone of landing, or, where that State or free trade zone forms part of a customs union, any other Member State of that customs union. “Import” would be defined as the physical entering or bringing of a catch into any part of the geographical territory under the control of a State, except where the catch is landed or transshipped within the definitions of “land or landing” or “transship.” “Land or landing” means to begin offloading any fish, to arrive in port with the intention of offloading any fish, or to cause any fish to be offloaded; except for purposes of catch documentation in which case it would be defined as the initial transfer of catch in its harvested or processed form from a vessel to dockside or to another vessel in a port or free trade zone where the catch is certified by an authority of the Port State as landed. “Port State” would be defined as the State that has control over a particular port area or free trade zone for the purposes of landing, transshipment, importing, exporting and re-exporting and whose authority serves as the authority for landing or transshipment certification. “Re-export” would be defined as any movement of a catch in its harvested or processed form from the territory under the control of a State, free trade zone, or Member State of a customs union of import unless that State, free trade zone, or any Member State of that customs union of import is the first place of import, in which case the movement is an export within the definition of export. “Tranship or transshipment” would be defined as the transfer of fish or fish products from one vessel to another; except for purposes of catch documentation in which case it would be defined as the transfer at sea of a catch in its harvested or processed form from a vessel to another vessel or means of transport and, where such transfer takes place within the territory under the control of a Port State, for the purposes of effecting its removal from that State. For the avoidance of doubt, temporarily placing a catch on land or on an artificial structure to facilitate such transfer shall not prevent the transfer from being a transshipment where the catch is not within the definition of landing. NMFS implemented the CCAMLR CDS for toothfish in 2000. The CDS tracks and monitors trade in toothfish through a DCD required on all shipments of toothfish, wherever harvested, as a condition of import into the United States or any other CCAMLR Contracting Party. In giving effect to the CDS, NMFS amended its definition of “Antarctic marine living resources” to include “All species of Dissostichus wherever found,” i.e., whether harvested inside or outside the CCAMLR Convention Area. The change of this definition caused some confusion among members of the public as to whether or not an AMLR harvesting permit was required for vessels which wanted to fish for toothfish both inside and outside the Convention Area. The proposed rule would clarify that an AMLR Harvesting Permit is required by NMFS only when harvesting toothfish within the Convention Area by deleting “All species of *Dissostichus* wherever found” from the definition of Antarctic Marine Living Resources. Harvesting toothfish on high seas areas inside and outside the Convention Area would continue to require a permit issued by NMFS pursuant to the High Seas Fishing Compliance Act (HSFCA), 16 U.S.C. 5501 *et seq.* Areas within the Convention Area subject to national jurisdiction, such as the areas in Convention Subarea 48.3 claimed by the United Kingdom, are not considered high seas areas. The rule would preserve the requirement that all imports of toothfish, wherever harvested, comply with U.S. import permit conditions and DCD controls. The proposed rule would define “national observers” and “international observers.” National observer would be defined as a U.S. national placed and operating onboard a U.S. flagged vessel as a scientific observer in accordance with 50 CFR 300.113. International observer would be defined as a scientific observer operating in accordance with the CCAMLR Scheme of International Scientific Observation and the terms of a bilateral arrangement concluded between the United States and a Member of CCAMLR for the placement of a U.S. national onboard a vessel flagged by a Member of CCAMLR or for the placement of the national of a Member of CCAMLR onboard a U.S. flagged vessel. The proposed rule would define “seal excluder device” as a barrier within the body of a trawl net comprised of a metal frame, nylon mesh, or any material that results in an obstruction to seals between the mouth opening and the cod end of the trawl. The body of the trawl net forward of the barrier must include an escape opening through which seals entering the trawl can escape. The proposed rule would define “vessel monitoring system or VMS” as a system or mobile transceiver unit approved by NMFS for use on vessels that take AMLR, and that allows a Flag State, through the installation of satellite-tracking devices on board its fishing vessels to receive automatic transmission of certain information. The proposed rule would define “mobile transceiver unit” as a vessel monitoring system or VMS device, as set forth at § 300.116, installed on board a vessel that is used for vessel monitoring and transmitting the vessel's position as required by subpart G of 50 CFR part 300. It would define the “Office for Law Enforcement (OLE)” as the National Marine Fisheries Service, Office for Law Enforcement, Northeast Division. Information on Harvesting Vessels NMFS would request the following information of all applicants for an AMLR harvesting permit. CCAMLR adopted a Conservation Measure (10-02) in 2004 requiring additional details on every vessel a Member State licenses to fish in the Convention Area, including the name of the fishing vessel (any previous names, if known); registration number; vessel's International Maritime Organization

(IMO)number, if issued; external markings and port registry; the nature of the authorization to fish granted by the Flag State, specifying time periods authorized for fishing; areas of fishing; species targeted; gear used; previous flag, if any; international radio call sign; the name and address of the vessel's owner(s) and any beneficial owner(s), if known; name and address of license owner, if different from vessel owner; type of vessel; where and when built; length; three color photographs of the vessel; and where applicable, details of the implementation of the tamper-proof requirements on the satellite-linked vessel monitoring device. CCAMLR requested, to the extent practicable, the following additional information for vessels notified for fishing in exploratory fisheries: name and address of operator, if different from vessel owner; name and nationality of master and, where relevant, of fishing master; type of fishing method or method; beam in meters; gross registered tonnage; vessel communication types and numbers; normal crew complement; power of main engine or engines in kilowatts; carrying capacity in tons; number of fish holds and their capacity in cubic meters; and any other information in respect of each licensed vessel considered appropriate (e.g., ice classification) for the purposes of the implementation of the Conservation Measure 21-02. Classification The Act This proposed rule is published under the authority of, and consistent with, the Antarctic Marine Living Resources Convention Act of 1984, codified at 16 U.S.C. 2431 *et seq.* National Environmental Policy Act A “Draft Programmatic Environmental Impact Statement on Codified Regulations at 50 CFR Part 300 Subparts A and G Implementing Conservation and Management Measures Adopted by the Commission for the Conservation of Antarctic Marine Living Resources” was prepared by NMFS and published on July 1, 2005 (70 FR 38132). It analyzes actions proposed in this rule. Regulatory Flexibility Act NMFS prepared an Initial Regulatory Flexibility Analysis, as required by section 603 of the Regulatory Flexibility Act, to describe the economic impacts this proposed regulation may have on small entities. Small entities within the scope of this proposed rule include individual U.S. vessels and U.S. dealers (importers and re-exporters). This proposed rule does not duplicate, overlap, or conflict with other Federal regulations. Summary of IRFA A description of the reasons for, the objectives of, and the legal basis for this proposed rule is contained in the preamble and not repeated here. Description of the Number of Entities: During the past several years, there have been 5 vessels (2 for toothfish, 2 for krill, and 1 for crab) and 80 dealers who could fall within the scope of this proposed regulation. All U.S. vessels and U.S. dealers are considered small entities under the “Small Business Size Regulations” established by the Small Business Administration

(SBA)under 13 CFR 121.201. There are no disproportionate impacts between large and small entities since all affected businesses are considered small entities by SBA standards. Economic Analysis of Proposed Regulatory Action and the Status Quo *1. Centralized VMS.* CCAMLR adopted Conservation Measure 10-04 to implement C-VMS. In implementing Conservation Measure 10-04, NMFS considered two alternatives: the proposed rule (preferred alternative) and the status quo (no-action) alternative. The preferred alternative would require NMFS and U.S.-flagged vessels fishing for AMLR to participate in C-VMS as established by the CCAMLR Secretariat. NMFS currently requires both a VMS unit on-board a U.S. vessel (50 CFR 300.107(a)(4)) and reporting of a U.S. vessel's location every four hours (50 CFR 300.107(a)(3)). Therefore, the preferred alternative does not represent a change in operating procedures for U.S.-flagged vessels currently participating in AMLR fisheries or for U.S. dealers currently importing toothfish shipments into the United States. Possible benefits resulting from the proposed rule may include: automation of the submission of VMS data to the CCAMLR Secretariat; timely responses from the CCAMLR Secretariat to NMFS's inquires into fishing activities of a foreign vessel; faster investigations into authenticity of catch documentation; more efficient response time to NMFS requests for VMS data from flag nations; and freeing agency resources from having to respond to VMS data requests from Contracting Parties. The following cost estimates assume a single VMS technology: Inmarsat-C (this one is commonly used but there are other VMS technologies). Possible compliance costs to U.S. fishing vessels associated with the preferred alternative include the initial cost of the VMS unit estimated at $2,250 each (includes purchase price and installation; excludes freight); the annual cost of maintenance estimated at $350.00 per year (based on a 5-year life cycle for the equipment); and the annual cost of VMS transmission for a 6-month season, fishing every day, estimated at between $54.00 and $108.00 (based on a per-day charge of $.30 to $.60 per day, depending on the service provider, for 180 days). However, for U.S.-flagged vessels currently participating in AMLR fisheries, no additional compliance costs associated with the proposed rule are anticipated as such costs have already been realized to comply with requirements at 50 CFR 300.107(a)(4) and (a)(3), respectively. For future participants in AMLR fisheries, compliance costs would include the cost of the VMS unit, freight, installation, maintenance, and the cost per day for a service provider to transmit VMS reports. This transmission cost is estimated at $54.00 and $108.00, as stated above. Transmission of VMS reports to the CCAMLR Secretariat to fulfill the “centralized” aspect of this preferred alternative will be made by NMFS and does not represent an additional cost burden to U.S. vessels. The status quo (no-action alternative) is NMFS's non-participation in C-VMS. Neither current nor future participants in AMLR fisheries will incur additional compliance costs as a direct result of this alternative, nor will these participants incur additional compliance costs as a direct result of the preferred alternative. As stated above, this is due to 50 CFR 300.107(a)(4) and (a)(3), respectively. Regardless of whether NMFS participates in C-VMS (the preferred alternative) or does not participate in C-VMS (the status quo alternative), no net change in economic impacts to U.S. vessels currently participating in AMLR fisheries will occur as a direct result of the proposed rule. Nonetheless, NMFS rejected the status quo alternative due to the potential benefits associated with C-VMS mentioned above. *2. Dealer Permits and Preapproval.* The proposed rule (preferred alternative) would tighten and improve the import/re-export control program that the United States maintains for AMLR. The proposed rule would allow U.S. dealers additional time to obtain the 7501 number. This preferred alternative is expected to benefit U.S. dealers by providing a timeframe for the preapproval process that takes into consideration U.S. Customs administrative procedures. The status quo (no-action alternative) would maintain the existing NMFS requirement that U.S. dealers must submit the 7501 number 15 working days prior to the arrival of a shipment as part of their preapproval application. Currently, U.S. dealers have difficulty complying with this NMFS requirement because U.S. Customs has stated that the 7501 number cannot be issued until it receives all of the required paperwork from the broker a requirement that is often difficult to meet 15 days prior to the arrival of a shipment of toothfish. Due to the perishable nature of fresh and frozen toothfish, delays associated with the existing preapproval requirements could hinder toothfish shipments from reaching the market in a timely manner, resulting in a lower quality of toothfish product. This delay may further result in lost revenue to U.S. dealers, representing negative economic impacts. Based on the above, NMFS rejected this alternative. The second part of this preferred alternative would exempt all U.S. dealers importing shipments of fresh toothfish weighing more than 2,000 kilograms from preapproval of the DCD requirement. Under current NMFS requirements (the no-action alternative), U.S. dealers who import fresh toothfish shipments of 2,000 kilograms or more must pay the same fee-for-service as U.S. dealers who import frozen toothfish shipments that average 25,000 kilograms. This requirement financially penalizes U.S. dealers importing numerous smaller shipments of fresh product at a $200 fee for each, while U.S. dealers importing frozen product less frequently pay the same $200 fee for their larger shipments. This represents a disproportionate cost to U.S. dealers importing shipments of fresh toothfish weighing 2,000 kilograms or more relative to U.S. dealers importing frozen toothfish. Though only 4 percent of fresh toothfish shipments weigh 2,000 kilograms or more, and only a small number of U.S. dealers (2 or fewer U.S. dealers) are affected by the current preapproval of DCD requirement, the status quo represents a negative economic impact to these U.S. dealers. The current cost of an estimated 8 preapproval applications for 80 dealers is $128,000. Future costs resulting from the proposed rule for an estimated 8 preapproval applications for 78 dealers is $124,800. Therefore, because the proposed rule will likely represent a positive economic impact (decrease in cost) to these 2 or fewer dealers, the status quo was rejected. *3. Electronic Catch Documents.* The proposed rule (the preferred alternative) would require that all imports of toothfish be documented using the electronic format recommended by CCAMLR. The proposed rule would increase the security and reliability of catch documents and facilitate the trade of toothfish on behalf of U.S. dealers by decreasing the time needed by NMFS to process approval of shipments. U.S. dealers currently participating in AMLR trade are anticipated to have positive economic benefits associated with this preferred alternative by avoiding costs associated with demurrage charges and delays getting toothfish products into commerce. Additionally, there are no transmission costs to transmit electronic DCDs. The CCAMLR Secretariat maintains a website accessible by CDS participants for the transmission of electronic DCDs via the web. Therefore, there are no anticipated economic costs to U.S. dealers associated with the use of electronic DCDs. The status quo (no-action alternative) of not participating in electronic DCDs is not anticipated to result in a change in economic impacts for current or future participants in AMLR fisheries. However, NMFS rejected the no-action alternative because electronic DCDs would result in positive economic impacts to U.S. dealers as noted above. *4. Scientific Observers.* NMFS regulations currently require one scientific observer on each U.S. vessel participating in fishing activities in the Convention Area (50 CFR 300.106(c), 300.111(d), and/or 300.112(i)). The status quo (no-action alternative) would leave these regulations and processes in place. For current participants in AMLR fisheries, the preferred alternative is anticipated to represent at most a minimal compliance cost for U.S. vessels since scientific observers are already required by NMFS regulations. These minimal compliance costs may include new requirements such as a work station for use by the scientific observer which can likely be fabricated at minimal cost to the vessel. For future participants in exploratory or assessed fisheries, the proposed rule will represent a compliance cost for each scientific observer ranging from $55,900 per fishing season (or $232.92 per day for 240 days) to $89,220 per fishing season (or $371.75 per day for 240 days). This cost includes estimates for observer salary, insurance, travel costs, overhead, and other miscellaneous expenses associated with scientific observers. Additionally, this cost range reflects the planned cost for a U.S. scientific observer in the Antarctic krill fishery ($55,900 per fishing season, extrapolated from actual costs from previous fishing seasons) and the average U.S. scientific observer cost for the North Pacific groundfish fishery ($89,220 per fishing season). U.S. scientific observer cost for Alaskan fisheries was used here due to the Alaskan fisheries similarities with Antarctic fisheries in terms of environmental conditions, travel costs for the U.S. scientific observer to travel to and from the vessel, vessel size, and fishing season length. This level of coverage provides a good estimate for the average cost of a U.S. scientific observer in the Antarctic fisheries, and represents a middle range relative to the cost of scientific observers nationwide. Since the proposed rule (preferred alternative) seeks to clarify the process of placing observers on board vessels fishing in the Convention Area and codify requirements and prohibitions associated with observer placement, the no-action alternative was rejected. This proposed rule would clarify the process by specifying placement of national observers on U.S. vessels harvesting AMLR; the duties and responsibilities of the observers on the vessels; and the duties and responsibilities of the vessel owners hosting the observers. *5. Seal Excluder Device (SED).* The proposed rule would require the use of a seal excluder device

(SED)on all U.S. vessels trawling for krill in the Convention Area (the preferred alternative). Use of SEDs and other mitigation measures to avoid fur seal deaths have been in use on some vessels for only 1 to 2 years. In a 2005 study by Hooper *et al* ., (CCAMLR Science, vol. 12: 195-205), it was concluded that mitigation measures either eliminated or greatly reduced the incidence of seal entanglements during the 2004-2005 season. Costs were found to be minimal due to the array of mitigation measures available to fishers; choice of mitigation measures depended on their budget and fishing strategy. Based on this study, the compliance cost associated with incorporating SEDs on U.S. vessels currently participating in the krill fishery is anticipated to be minimal. For future participants in this fishery, additional costs associated with SEDs is anticipated to be small relative to the cost of the fishing gear itself. In addition, because the study found that SEDs did not cause a decrease in catch per unit effort (vessel productivity), the overall harvest is not anticipated to decline for current or future participants in this fishery based on the SEDs. Therefore, negative economic impacts are not anticipated for current or future participants in this fishery. Positive economic impacts related to the use of SEDs which successfully reduce or eliminate seal capture include: decreasing expenditures on time of operations and on fuel due to fewer seal entanglements which create drag on fishing gear; increasing catch by allowing nets to remain open longer since seal capture will be reduced; and reducing damage to trawl gear and to the catch associated with seal capture. Not including a regulatory requirement for SEDs was considered but rejected as an alternative because the NMFS believes SEDs are necessary to reduce or eliminate seal capture. *6. Definitions.* The proposed rule (the preferred alternative) would amend the definition of “Antarctic marine living resources” by deleting “All species of *Dissostichus* wherever found” from the definition. This change would clarify this term and is not anticipated to have a negative economic impact on current fisheries operations inside or outside the Convention Area. Instead, it may represent a positive economic impact by eliminating permit-related costs to vessels who may have purchased an AMLR permit to harvest toothfish outside of the Convention Area when in fact the AMLR permit was unnecessary. Therefore, the status quo alternative, keeping the definition in its current form and thereby requiring AMLR permits to harvest toothfish outside Convention Area, was rejected. The proposed rule would also add or amend the terms, “export”, “import”, “international observer”, “landing”, “mobile transceiver unit”, “national observer”, “Office of Law Enforcement (OLE)”, “Port State”, “re-export”, “seal excluder device”, “transhipment”, and “vessel monitoring system (VMS)”, as used by NMFS in implementing the CCAMLR CDS. The proposed rule (preferred alternative) would define and clarify the use of these terms since they are not currently defined by NMFS regulations with regard to the CDS. The status quo was rejected because clarifying these terms will provide better guidance to fishery participants and dealers. The revised or new definitions are needed to conform U.S. regulations with CCAMLR conservation measures. The proposed rule is not anticipated to have an economic impact on legitimate fisheries operations in the Convention Area. *7. Information on Harvesting Vessels.* CCAMLR adopted a Conservation Measure (10-02)in 2004 requiring additional details on every vessel a Member State licenses to fish in the Convention Area. Requested information includes the name of the fishing vessel; registration number; vessel's IMO number, if issued; external markings and port registry; three color photographs of the vessel; and other information related to the vessel, fishing operations, and equipment. The proposed rule would request this information of all applicants for an AMLR harvesting permit and may represent a minimal cost to current and future participants in terms of the time needed to fulfill the information request and costs associated with obtaining three color photographs of the vessel. NMFS makes this determination based on an estimate, in hours, of the burden to vessels for the collection of information which is estimated to be two hours: one hour for a harvest permit application and one hour for an annual report. In addition, though the cost of obtaining three color photographs of the vessel was not itemized, the cost is anticipated to be minimal. These information requirements are specified in a Conservation Measure agreed to by the United States in CCAMLR. Therefore, other alternatives were not considered. There are no Federal rules that duplicate, overlap, or conflict with this proposed rule. Executive Order 12866 The proposed rule has been determined to be not significant for purposes of Executive Order 12866. Paperwork Reduction Act This proposed rule contains collection-of-information requirements subject to review and approval by OMB under the Paperwork Reduction Act (PRA). Requirements for 94 respondents have previously been approved under OMB Control Number 0648-0194, with a total response time 576 hours. This rule also contains new or revised collection of information requirements that have been submitted to OMB for approval and which reduce the number of respondents and total burden hours in the overall PRA collection (for current and proposed regulations) to 86 respondents (5 vessels/vessel representatives, 80 dealers, and one CCAMLR Ecosystem Monitoring Program applicant) and 295 burden hours. The reduced number of respondents and burden hours is due to an overestimation in the previous collection of information of the number of dealers importing toothfish and the number of pre-approval applications they would be submitting. The new information collection requirements of this proposed rule are for C-VMS. The estimate in information collection burden hours for an estimated harvesting fleet size of 5 vessels is 14 hours per year with an associated labor cost of $350.00 (at $25/hour). There is also an estimated total annual cost burden of $4,270.00 for the fleet (5 vessels) for VMS purchase, installation, maintenance, and transmission costs resulting from the C-VMS collection. This $4,270.00 cost was estimated as follows:

(a)vessel VMS equipment purchase and installation = $2,250.00, annualized based on estimated 5-year useful life = $450 x 5 vessels = $2,250.00 annualized cost for the fleet;

(b)annual vessel VMS maintenance per vessel = $350 x 5 vessels = $1,750.00 annualized maintenance, for the fleet; and

(c)annual vessel transmission costs: $54.00 x 5 vessels = $270.00 for the fleet. As indicated earlier in this Classification section under Summary of the IRFA where C-VMS is discussed, for U.S.-flagged vessels currently participating in AMLR fisheries, compliance costs associated with the proposed rule are anticipated to be minimal because such costs have already been realized to comply with requirements at 50 CFR 300.107(a)(3) and (a)(4). The response estimates above include the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Public comment is sought regarding: whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the burden estimate; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the collection of information, including through the use of automated collection techniques or other forms of information technology. Send comments on these or any other aspects of the collection of information to NMFS and OMB (see ADDRESSES ). Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB Control Number. List of Subjects in 50 CFR Part 300 Fisheries, Fishing, Fishing vessels, Foreign relations, Reporting and recordkeeping requirements, Statistics, Treaties. Dated: July 7, 2006. William T. Hogarth, Assistant Administrator for Fisheries, National Marine Fisheries Service. For the reasons set out in the preamble, 50 CFR part 300, subpart G is proposed to be amended as follows: PART 300—INTERNATIONAL FISHERIES REGULATIONS Subpart G—Antarctic Marine Living Resources 1. The authority citation for 50 CFR part 300, subpart G, is revised to read as follows: Authority: 16 U.S.C. 2431 *et seq.* , 31 U.S.C. 9701 *et seq.* 2. In § 300.101, in the definition of “Antarctic marine living resources (AMLRs)” paragraph

(2)is removed and paragraph

(3)is revised and redesignated as paragraph (2); and definitions for “Export”, “Import”, “International observer”, “Mobile transceiver unit”, “National observers”, “Office for Law Enforcement (OLE)”, “Port State”, “Re-export”, and “Seal excluder device” are added in alphabetical order; and the definitions of “Land or landing”, “Tranship”, “Transshipment”, and “Vessel Monitoring System or VMS” are revised to read as follows: § 300.101 Definitions. *Antarctic marine living resources (AMLRs)* * * *

(2)All parts or products of those populations and species set forth in paragraph

(1)of this definition. *Export* as used in § 300.107(c) means any movement of a catch in its harvested or processed form from a territory under the control of the State or free trade zone of landing, or, where that State or free trade zone forms part of a customs union, any other Member State of that customs union. *Import* as used in §§ 300.107(c) and 300.114 means the physical entering or bringing of a catch into any part of the geographical territory under the control of a State, except where the catch is landed or transshipped within the definitions of landing or transshipment. *International observer* means a scientific observer operating in accordance with the CCAMLR Scheme of International Scientific Observation and the terms of a bilateral arrangement concluded between the United States and a Member of CCAMLR for the placement of a U.S. national onboard a vessel flagged by a Member of CCAMLR or for the placement of the national of a Member of CCAMLR onboard a U.S. flagged vessel. *Land or Landing* means to begin offloading any fish, to arrive in port with the intention of offloading any fish, or to cause any fish to be offloaded; Except for purposes of catch documentation as provided for in § 300.107(c), land or landing means the initial transfer of catch in its harvested or processed form from a vessel to dockside or to another vessel in a port or free trade zone where the catch is certified by an authority of the Port State as landed. *Mobile transceiver unit* means a vessel monitoring system or VMS device, as set forth at § 300.116, installed on board a vessel that is used for vessel monitoring and transmitting the vessel's position as required by this subpart. *National observer* means a U.S. national placed and operating onboard a U.S. flagged vessel as a scientific observer in accordance with § 300.113. *Office for Law Enforcement (OLE)* refers to the National Marine Fisheries Service, Office for Law Enforcement, Northeast Division. *Port State* means the State that has control over a particular port area or free trade zone for the purposes of landing, transshipment, importing, exporting and re-exporting and whose authority serves as the authority for landing or transshipment certification. *Re-export* as used in §§ 300.107(c) and 300.114 means any movement of a catch in its harvested or processed form from a territory under the control of a State, free trade zone, or Member State of a customs union of import unless that State, free trade zone, or any Member State of that customs union of import is the first place of import, in which case the movement is an export within the definition of export. *Seal excluder device* means a barrier within the body of a trawl comprised of a metal frame, nylon mesh, or any material that results in an obstruction to seals between the mouth opening and the cod end of the trawl. The body of the trawl net forward of the barrier must include an escape opening through which seals entering the trawl can escape. *Tranship or transshipment* means the transfer of fish or fish products from one vessel to another; Except for purposes of catch documentation as provided for in §§ 300.107(c) and 300.114, tranship or transshipment means the transfer at sea of a catch in its harvested or processed form from a vessel to another vessel or means of transport and, where such transfer takes place within the territory under the control of a Port State, for the purposes of effecting its removal from that State. Temporarily placing a catch on land or on an artificial structure to facilitate such transfer does not prevent the transfer from being a transshipment where the catch is not landed with the definition of landing. *Vessel Monitoring System (VMS)* means a system or mobile transceiver unit approved by NMFS for use on vessels that take AMLR, and that allows a Flag State, through the installation of satellite-tracking devices on board its fishing vessels to receive automatic transmission of certain information. § 300.106 [Amended] 3. In § 300.106, paragraph

(c)is removed and paragraphs

(d)and

(e)are redesignated as paragraphs

(c)and (d), respectively. 4. In § 300.107, paragraphs (a)(4), (c)(2)(i), (c)(5)(i)(A), (c)(5)(i)(C), and (c)(5)(iii) are revised to read as follows: § 300.107 Reporting and recordkeeping requirements. (a)***

(4)Install a NMFS approved VMS unit for use in the CCAMLR Centralized satellite-linked vessel monitoring system (C-VMS) on board U.S. vessels harvesting Antarctic marine living resources that automatically transmits the vessel's position at least every 4 hours to a NMFS-designated land-based fisheries monitoring center or centers. The unit must be operated from the time the vessel leaves any port until its return to any port. The requirements for the installation and operation of the VMS are set forth at § 300.116. (c)* * * (2)* * *

(i)In addition to any AMLR harvesting permit or a High Seas Fishing Compliance Act permit issued pursuant to § 300.12, a U.S. vessel harvesting or attempting to harvest Dissostichus species, wherever found, must possess a DCD issued by NMFS which is non-transferable. The master of the harvesting vessel must ensure that catch information specified on the DCD is accurately recorded. (5)*** (i)* * *

(A)Any dealer who imports toothfish must first obtain the document number and export reference number on the DCD corresponding to the import shipment and must produce verifiable information documenting use of C-VMS to allow entry into the United States.

(C)The reference numbers described in paragraph (c)(5)(i)(A) of this section must be entered by the dealer on the preapproval application for the shipment and sent to the address designated by NMFS so that NMFS receives the documentation at least 15 working days prior to import.

(iii)*Exception.* Preapproval is not required for shipments of fresh *Dissostichus* species. A report of a shipment of fresh *Dissostichus* species must be completed and submitted to NMFS within 24 hours following import. 5. In § 300.112, paragraph (b)(4) is added to read as follows: § 300.112 Harvesting permits. (b)* * *

(4)The owners and operators of each krill harvesting vessel using trawl gear in Convention Area fisheries must install a seal excluder device. §§ 300.117, 300.116, 300.115, 300.114, 300.113 [Redesignated as §§ 300.119, 300.118, 300.117, 300.115, 300.114] 6. Sections 300.17, 300.116, 300.115, 300.114 and 300.113 are redesignated as §§ 300.119, 300.118, 300.117, 300.115, 300.114, respectively. 7. Add new § 300.113 to read as follows: § 300.113 Scientific observers.

(a)This section applies to U.S. observers aboard U.S. vessels harvesting in the Convention Area, U.S. observers placed on foreign flagged vessels and foreign observers placed on U.S. vessels.

(b)All U.S. vessels fishing in the Convention Area must carry one or more scientific observers as required by CCAMLR conservation and management measures or as specified in a NMFS-issued AMLR Harvesting Permit.

(c)All U.S. vessels conducting longline sink rate testing outside the Convention area and pursuant to CCAMLR protocols must carry one or more scientific observers as specified in a NMFS-issued AMLR Harvesting Permit.

(d)*Procurement of observers by vessel.* Owners of vessels required to carry scientific observers under this section must arrange for observer services in coordination with the NMFS Southwest Fisheries Science Center Antarctic Ecosystem Research Division. The vessel owner is required to pay for observer services through an observer service provider who has provided observer services to the Federal government within the past year. In situations where no qualified observer is available through a qualified observer provider, the Secretary may authorize a vessel owner to arrange for an observer by alternative methods. An observer may not be paid directly by the vessel owner.

(e)Insurance. The observer service provider or vessel owner must provide insurance for observers that provides compensation in the event an of injury or death during the entire deployment from the point of hire location and return equivalent to the standards of the North Pacific Groundfish Observer Program set forth in § 679.80 of this title.

(f)*Educational requirements.* National observer candidates must:

(1)Have a Bachelor's degree or higher from an accredited college or university with a major in one of the natural sciences; or

(2)Have successfully completed a minimum of 30 semester hours or equivalent in applicable biological sciences with extensive use of dichotomous keys in at least one course.

(g)*Health requirements.* National observers must have a signed and dated statement from a licensed physician that he or she has physically examined the observer. The statement must confirm that, based upon the physical examination, the observer does not have any health problems or conditions that would jeopardize that individual's safety or the safety of others while deployed, or prevent the observer from performing his or her duties satisfactorily. The statement must declare that prior to the examination; the physician was made aware of the duties of an observer and the dangerous, remote and rigorous nature of the work. The physician's statement must be submitted to the NMFS Southwest Fisheries Science Center Antarctic Ecosystem Research Division program office prior to approval of an observer. The physical exam must have occurred during the 12 months prior to the observer's deployment. The physician's statement will expire 12 months after the physical exam occurred. A new physical exam must be performed, and accompanying statement submitted, prior to any deployment occurring after the expiration of the statement

(h)*Vessel responsibilities.* An operator of a vessel required to carry one or more scientific observers must:

(1)*Accommodations and food.* Provide, at no cost to observers or the United States, accommodations and food on the vessel for the observer or observers that are equivalent to those provided for officers of the vessel; and

(2)*Safe conditions.*

(i)Maintain safe conditions on the vessel for the protection of observers including adherence to all U.S. Coast Guard and other applicable rules, regulations, or statutes pertaining to safe operation of the vessel.

(ii)Have on board:

(A)A valid Commercial Fishing Vessel Safety Decal issued within the past 2 years that certifies compliance with regulations found in 33 CFR chapter I and 46 CFR chapter I. NMFS will grant a waiver from the Voluntary Safety decal provision if the vessel is in compliance with the standards of the observer vessel safety check list developed by the Northeast Fisheries Science Center *http://www.nefsc.noaa.gov/femad/fsb/* or equivalent certification issued by the Flagging State;

(B)A certificate of compliance issued pursuant to 46 CFR 28.710; or

(C)A valid certificate of inspection pursuant to 46 U.S.C. 3311.

(3)*Health and safety regulations.* Comply with the Observer health and safety regulations at part 600 of this title. NMFS will grant a waiver from the Voluntary Safety decal provision if the vessel is in compliance with the standards of the observer vessel safety check list.

(4)*Transmission of data.* Facilitate transmission of observer data by allowing observers, on request, to use the vessel's communications equipment and personnel for the confidential entry, transmission, and receipt of work-related messages.

(5)*Vessel position.* Allow observers access to, and the use of, the vessel's navigation equipment and personnel, on request, to determine the vessel's position, course and speed.

(6)*Access.* Allow observers free and unobstructed access to the vessel's bridge, trawl or working decks, holding bins, processing areas, freezer spaces, weight scales, cargo holds, and any other space that may be used to hold, process, weigh, or store fish or fish products at any time.

(7)*Prior notification.* Notify observers at least 15 minutes before fish are brought on board, or fish and fish products are transferred from the vessel, to allow sampling the catch or observing the transfer, unless the observers specifically request not to be notified.

(8)*Records.* Allow observers to inspect and copy the vessel's CCAMLR DCD, product transfer forms, any other logbook or document required by regulations, printouts or tallies of scale weights, scale calibration records, bin sensor readouts, and production records.

(9)*Assistance.* Provide all other reasonable assistance to enable observers to carry out their duties, including, but not limited to:

(i)Measuring decks, codends, and holding bins; (ii)Providing the observers with a safe work area adjacent to the sample collection site;

(iii)Collecting bycatch when requested by the observers.

(iv)Collecting and carrying baskets of fish when requested by observers; and

(v)Allowing observers to determine the sex of fish when this procedure will not decrease the value of a significant portion of the catch.

(10)*Transfer at sea.*

(i)Ensure that transfers of observers at sea via small boat or raft are carried out during daylight hours, under safe conditions, and with the agreement of observers involved.

(ii)Notify observers at least 3 hours before observers are transferred, such that the observers can collect personal belongings, equipment, and scientific samples.

(iii)Provide a safe pilot ladder and conduct the transfer to ensure the safety of observers during transfers.

(iv)Provide an experienced crew member to assist observers in the small boat or raft in which any transfer is made.

(i)*Standards of Observer Conduct.*

(1)*Observers:*

(i)Must not have a direct financial interest in the fishery being observed, including but not limited to:

(A)Any ownership, mortgage holder, or other secured interest in a vessel, shoreside or floating stationary processor facility involved in the catching, taking, harvesting or processing of fish;

(B)Any business involved with selling supplies or services to any vessel, shoreside or floating stationary processing facility; or

(C)Any business involved with purchasing raw or processed products from any vessel, shoreside or floating stationary processing facilities.

(ii)Must not solicit or accept, directly or indirectly, any gratuity, gift, favor, entertainment, loan, or anything of monetary value from anyone who either conducts activities that are regulated by NMFS or has interests that may be substantially affected by the performance or nonperformance of the observers' official duties.

(iii)May not serve as observers on any vessel or at any shoreside or floating stationary processing facility owned or operated by a person who previously employed the observers.

(iv)May not solicit or accept employment as a crew member or an employee of a vessel, shoreside processor, or stationary floating processor while employed by an observer provider.

(2)Provisions for remuneration of observers under this section do not constitute a conflict of interest.

(j)*Standards of Observer Behavior.* Observers must avoid any behavior that could adversely affect the confidence of the public in the integrity of the Observer Program or of the government, including but not limited to the following:

(1)Observers must perform their assigned duties as described in the CCAMLR Scientific Observers Manual and must complete the CCAMLR Scientific Observer Logbooks and submit them to the CCAMLR Data Manager at the intervals specified by the Data Manager.

(2)Observers must accurately record their sampling data, write complete reports, and report accurately any observations of suspected violations of regulations relevant to conservation of marine resources or their environment.

(3)Observers must not disclose collected data and observations made on board the vessel or in the processing facility to any person except the owner or operator of the observed vessel or processing facility, or NMFS.

(4)Observers must refrain from engaging in any illegal actions or any other activities that would reflect negatively on their image as professional scientists, on other observers, or on the Observer Program as a whole. This includes, but is not limited to:

(i)Engaging in the use, possession, or distribution of illegal drugs; or

(ii)Engaging in physical sexual contact with personnel of the vessel or processing facility to which the observer is assigned, or with any vessel or processing plant personnel who may be substantially affected by the performance or non-performance of the observer's official duties.

(k)*Sampling Station.*

(1)Minimum work space aboard at sea processing vessels. The observer must have a working area of 4.5 square meters, including the observer's sampling table, for sampling and storage of fish to be sampled. The observer must be able to stand upright and have a work area at least 0.9 m deep in the area in front of the table and scale.

(2)Table aboard at-sea processing vessels. The observer sampling station must include a table at least 0.6 m deep, 1.2 m wide and 0.9 m high and no more than 1.1 m high. The entire surface area of the table must be available for use by the observer. Any area for the observer sampling scale is in addition to the minimum space requirements for the table. The observer's sampling table must be secured to the floor or wall.

(3)Other requirement for at-sea processing vessels. The sampling station must be in a well-drained area that includes floor grating (or other material that prevents slipping), lighting adequate for day or night sampling, and a hose that supplies fresh or sea water to the observer. 8. In newly redesignated § 300.114, paragraphs (a)(1), (a)(2), (b), and

(i)are revised to read as follows: § 300.114 Dealer permits and preapproval.

(a)* * *

(1)A dealer intending to import or re-export AMLR must obtain an AMLR dealer permit valid for one year. Preapproval from NMFS is required for each shipment of frozen Dissostichus species. The permit holder may only conduct those specific activities stipulated by the permit.

(2)An AMLR may be imported into the United States if its harvest has been authorized by a U.S.-issued individual permit issued under § 300.112(a)(1) or its importation has been authorized by a NMFS-issued dealer permit and preapproval issued under this paragraph

(a)of this section. AMLRs may not be released for entry into the United States unless accompanied by the harvesting permit or the individual permit or dealer permit and, in the case of frozen Dissosichus species, the preapproval certification granted by NMFS to allow import. NMFS will only accept electronic catch documents for toothfish imports.

(b)*Application* . Application forms for AMLR dealer permits and preapproval are available from NMFS. A complete and accurate application must be received by NMFS for each preapproval at least 15 working days before the anticipated date of the first receipt, importation, or re-export. Dealers may supply the U.S. Customs 7501 entry number within three working days of a *Dissostichus* species shipment's arrival.

(i)*Exception.* Preapproval is not required for shipments of fresh *Dissostichus* species. A report of a shipment of fresh *Dissostichus* species must be completed and submitted to NMFS within 24 hours following import. 9. Add § 300.116 to read as follows: § 300.116 Requirements for a vessel monitoring system.

(a)*Requirement for use.* Within 30 days after NMFS publishes in the **Federal Register** a list of approved transmitting units and associated communications service providers for the AMLR fishery, an owner or operator of a vessel that has been issued a harvesting permit for AMLR must ensure that such vessel has a NMFS-approved, operating VMS on board when on any fishing trip involving the harvesting of AMLR. An operating VMS includes an operating mobile transmitting unit on the vessel and a functioning communication link between the unit and NMFS as provided by a NMFS-approved communication service provider.

(b)*Installing and activating the VMS.* Only a VMS that has been approved by NMFS for use in the AMLR fishery may be used. When installing and activating the NMFS-approved VMS, or when reinstalling and reactivating such VMS, the vessel owner or operator must -

(1)Follow procedures indicated on an installation and activation checklist, which is available from OLE; and

(2)Submit to OLE a statement certifying compliance with the checklist, as prescribed on the checklist.

(c)*Interference with the VMS.* No person may interfere with, tamper with, alter, damage, disable, or impede the operation of the VMS, or attempt any of the same.

(d)*Interruption of operation of the VMS.* When a vessel's VMS is not operating properly, the owner or operator must immediately contact NMFS, Office of Enforcement, (OLE OFFICE), and follow instructions from that office. If notified by NMFS that a vessel's VMS is not operating properly, the owner and operator must follow instructions from that office. In either event, such instructions may include, but are not limited to, manually communicating to a location designated by NMFS the vessel's positions or returning to port until the VMS is operable.

(e)*Access to position data.* As a condition of authorized fishing for or possession of AMLR, a vessel owner or operator subject to the requirements for a VMS in this section must allow NMFS, the USCG, and their authorized officers and designees access to the vessel's position data obtained from the VMS.

(f)*Installation and operation of the VMS.* NMFS has authority over the installation and operation of the VMS unit. NMFS may authorize the connection or order the disconnection of additional equipment, including a computer, to any VMS unit when deemed appropriate by NMFS. 10. In newly designated § 300.117, paragraph

(t)is revised and new paragraphs

(u)through

(ff)are added to read as follows: § 300.117 Prohibitions.

(t)Import shipments of frozen Dissostichus spp. without a preapproval issued under § 300.114.

(u)Assault, resist, oppose, impede, intimidate, harass, bribe, or interfere with an observer.

(v)Interfere with or bias the sampling procedure employed by an observer, including physical, mechanical, or other sorting or discarding of catch before sampling.

(w)Tamper with, destroy, or discard an observer's collected samples, equipment, records, photographic film, papers, or personal effects without the express consent of the observer.

(x)Prohibit or bar by command, impediment, threat, coercion, or by refusal of reasonable assistance, an observer from collecting samples, conducting product recovery rate determinations, making observations, or otherwise performing the observer's duties.

(y)Harass an observer by conduct that has sexual connotations, has the purpose or effect of interfering with the observer's work performance, or otherwise creates an intimidating, hostile, or offensive environment. In determining whether conduct constitutes harassment, the totality of the circumstances, including the nature of the conduct and the context in which it occurred, will be considered. The determination of the legality of a particular action will be made from the facts on a case-by-case basis.

(z)Fish for or process fish without observer coverage required under § 300.113.

(aa)Require, pressure, coerce, or threaten an observer to perform duties normally performed by crew members, including, but not limited to, cooking, washing dishes, standing watch, vessel maintenance, assisting with the setting or retrieval of gear, or any duties associated with the processing of fish, from sorting the catch to the storage of the finished product.

(bb)Vessel monitoring systems.

(1)Use any vessel registered to an AMLR harvesting permit to conduct fishing operations unless that vessel carries a OLE type-approved mobile transceiver unit and complies with the requirements described in this subpart.

(2)Fail to install, activate, repair or replace a mobile transceiver unit prior to leaving port as specified in this subpart.

(3)Fail to operate and maintain a mobile transceiver unit on board the vessel at all times as specified in this subpart.

(4)Tamper with, damage, destroy, alter, or in any way distort, render useless, inoperative, ineffective, or inaccurate the VMS, mobile transceiver unit, or VMS signal required to be installed on or transmitted by a vessel as specified in this Subpart.

(5)Fail to contact OLE or follow OLE instructions when automatic position reporting has been interrupted as specified in this subpart.

(6)Register a VMS transceiver unit registered to more than one vessel at the same time.

(7)Connect or leave connected additional equipment to a VMS unit without the prior approval of the OLE.

(8)Make a false statement, oral or written, to an authorized officer regarding the installation, use, operation, or maintenance of a VMS unit or communication service provider.

(9)Fail to operate a Centralized satellite-linked vessel monitoring system (C-VMS) on board U.S. vessels harvesting AMLR in the Convention Area from the time of leaving port to returning to port.

(cc)Fail to use the mitigation measures required in the course of longline fishing or longline fishing research in the Convention Area to minimize the incidental mortality of seabirds.

(dd)Fail to use the mitigation measures required in the Convention Area to minimize the incidental mortality of seabirds and marine mammals in the course of trawl fishing.

(ee)Set longlines in Subareas 48.6, 88.1 and 88.2 Divisions 58.4.1, 58.4.2, 58.4.3a, 58.4.3b and 58.5.2 during daylight hours without following the CCAMLR protocol designed to mitigate seabird interactions.

(ff)Trawl for krill in Convention Area fisheries without a seal excluder device. [FR Doc. 06-6166 Filed 7-12-06; 8:45 am]

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