Rules and Regulations. Final rule

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BILLING CODE 4910-13-M DEPARTMENT OF ENERGY Federal Energy Regulatory Commission 18 CFR Part 260 [Docket No. RM06-18-000; Order No. 682] Revision of Regulations To Require Reporting of Damage to Natural Gas Pipeline Facilities Issued August 23, 2006. AGENCY: Federal Energy Regulatory Commission, DOE. ACTION: Final rule. SUMMARY: The Federal Energy Regulatory Commission is amending its regulations to require that jurisdictional natural gas companies report damage to facilities as the result of a natural disaster or terrorist activity that results in a reduction in pipeline throughput or storage deliverability.

The Commission is issuing this Final Rule based on its experience following Hurricanes Rita and Katrina under the existing reporting requirements which only require pipeline companies to report service interruptions and therefore did not require natural gas companies to report significant hurricane damage to facilities in instances where service interruptions were avoided by rerouting gas supplies or other means. The Commission has determined that the additional reporting requirements are necessary in order to effectively monitor the nation's natural gas infrastructure in crisis situations.

EFFECTIVE DATE: The rule will become effective August 29, 2006. FOR FURTHER INFORMATION CONTACT: Berne Mosley, Office of Energy Projects, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426.

(202)502-8625. Howard Wheeler, Office of Energy Projects, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426.

(202)502-8688. William Blome, Office of the General Counsel, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426.

(202)502-8462. SUPPLEMENTARY INFORMATION: Before Commissioners: Joseph T. Kelliher, Chairman; Suedeen G. Kelly, Marc Spitzer, Philip D. Moeller, and Jon Wellinghoff. I. Introduction 1. On June 9, 2006, the Federal Energy Regulatory Commission (Commission) issued a Notice of Proposed Rulemaking

(NOPR)in this proceeding. 1 In that NOPR, we proposed to revise § 260.9 of our regulations, 2 which requires the reporting of serious service interruptions on interstate natural gas pipeline facilities operated under authority granted by the Commission under the Natural Gas Act. 3 This Final Rule revises § 260.9 largely in the manner described in the NOPR, with certain modifications to clarify and limit the scope of the new reporting requirements in response to the comments that have been filed. The revisions to § 260.9 will ensure that the Commission has adequate and timely information concerning damage to jurisdictional pipeline and storage facilities as the result of natural disasters or terrorist activity. 1 71 FR 35226 (June 19, 2006); FERC Stats. & Regs. ¶ 32,604 (2006). 2 18 CFR 260.9 (2006). 3 15 U.S.C. 717-717z (2006). II. Background 2. In the NOPR, the Commission explained that the severe hurricanes during the summer of 2005 did serious and widespread damage to the energy production and delivery systems of the United States, particularly in the Gulf Coast region. We noted that as of May 3, 2006, shut-in natural gas production in the Gulf of Mexico from Hurricanes Katrina and Rita was equivalent to 12.95 percent of current daily gas production. 4 The Commission also explained that it had participated in the Federal effort, led by the U.S. Department of Energy, to collect post-hurricane information on damage to the nation's energy infrastructure. 5 The Commission learned that, although it had been kept informed of serious service interruptions as the regulations required, it lacked vital information regarding the physical condition of facilities affecting operation of the pipeline grid. 4 Hurricane Katrina/Hurricane Rita Evacuation and Production Shut-in Statistics Report as of Wednesday, May 3, 2006 [Final Report], U.S. Department of the Interior, Minerals Management Service (May 3, 2006). 5 *See* Homeland Security Presidential Directive (HSPD)-5 (February 28, 2003), directing the Secretary of Homeland Security to develop a National Response Plan. 3. The deficiency in reporting following the 2005 hurricanes resulted because the current reporting requirements of § 260.9 apply only in the event of service interruptions. In instances where service interruptions were avoided by adjusting nomination schedules, rerouting gas flows over alternate facilities, or drawing down storage supplies, § 260.9 did not require that companies report damage to gas facilities. Therefore, it was necessary for our staff to informally gather information regarding damage to facilities from pipeline companies and industry groups by telephone calls and other means. While we took steps based on available information to encourage rapid repair of facilities and restoration of service, including the granting of waivers of various regulations where necessary, 6 the informal information gathering process was not adequate to ensure timely and accurate monitoring of gas infrastructure. 6 *See* NOPR, at P. 4. 4. As the result of our experience during and following the 2005 hurricane season, we concluded that additional reporting requirements are necessary to ensure that the Commission has enough information to assess the status of the nation's natural gas pipeline infrastructure at any given time and share this information with other agencies, such as the U.S. Department of Energy and the U.S. Department of Transportation. Therefore, the Commission's June 9 NOPR proposed modifications to § 260.9 of the regulations to add a requirement that pipelines report damage to certificated facilities that results in loss of or reduction in service through such facilities and also report when service through such facilities has been restored. The Commission proposed to expand the informational requirements of § 260.9 to require reports including specific information concerning the location and cause of damage to facilities and service interruptions, the time of occurrence, emergency actions taken to maintain service, and other matters. The revised § 260.9 would also require that a company send copies of damage reports to state commissions, as is already required for reports of serious service interruptions. We also proposed to allow filing by e-mail and to eliminate the reference to filing by telegraph. 5. The NOPR was published in the **Federal Register** on June 19, 2006, 7 with July 19, 2006 being the deadline for comments. We received nine sets of comments on the NOPR. Comments were filed by American Gas Association (AGA), 8 American Public Gas Association (APGA), 9 Boardwalk Pipeline Partners, LP (Boardwalk Pipelines), Duke Energy Gas Transmission, LLC (Duke Energy), 10 Interstate Natural Gas Association of America (INGAA), National Fuel Gas Distribution Corporation (National Fuel Gas), 11 NiSource, Inc. (NiSource), 12 Paiute Pipeline Company (Paiute), and Williston Basin Interstate Pipeline Company (Williston Basin). The comments are described and addressed below. 7 71 FR 35226. 8 AGA represents 197 local energy utility companies delivering gas to more than 56 million homes, business and industries in the United States. AGA states that its members account for about 83 percent of all natural gas delivered by local distribution companies. 9 APGA is an association of approximately 650 municipal and other publicly-owned local distribution systems in 36 states. 10 Duke Energy owns Texas Eastern Transmission, LP; Egan Hub Storage, LLC; Algonquin Gas Transmission, LLC; Saltville Gas Storage, LLC; and East Tennessee Natural Gas, LLC. It is a part-owner of Maritimes & Northeast Pipeline, L.L.C., and Gulfstream Natural Gas System, L.L.C. 11 National Fuel Gas is a local distribution company subject to the jurisdiction of the New York Public Service Commission and the Pennsylvania Public Utility Commission. It is a member of AGA and supports AGA's comments. 12 NiSource owns and operates five interstate pipelines, ten local distribution companies and a joint venture storage company. III. Comments 6. The commenters representing local distribution companies express strong support for the Commission's effort to ensure timely reporting of damage to the natural gas infrastructure. These commenters emphasize that information on the operating status of the pipelines' facilities is a critical component of price formation, particularly during periods of infrastructure distress such as that experienced as the result of Hurricanes Katrina and Rita. They believe the proposed reporting requirements are needed to help consumers assess the supply and transportation situation following such damaging events. 7. The other commenters represent the interstate pipeline industry and are potential respondents to the new reporting requirements. These commenters generally acknowledge the need for this expedited rulemaking proceeding to remedy the current gap in reporting requirements so that the Commission is able to quickly identify significant infrastructure problems in the event this season produces hurricanes as damaging as last year's. 8. However, the pipeline companies strongly urge the Commission to work toward the long-term goal of minimizing duplicative Federal reporting requirements by engaging in cooperative efforts with the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration (DOT/Pipeline Safety) 13 and the National Response Center. Some commenters believe the Commission and these other agencies ultimately should be able to develop a single, comprehensive form that could be filed in one place and made available to any agency needing the information. 14 13 DOT/Pipeline Safety's reporting requirements are part of its administration of the Natural Gas Pipeline Safety Act of 1968, 49 U.S.C. 60101 *et seq.* 14 Additional discussion pertaining to reporting burden is included below in this Final Rule's Information Collection Statement. 9. In the interim, the pipeline companies request that the Commission clarify and narrow the definition of “damage” in § 260.9 so that pipeline companies will not be required to file reports unnecessary to fulfill the Commission's objective in this rulemaking of ensuring that it has adequate and timely information to identify significant problems with the nation's natural gas infrastructure. The pipeline companies emphasize that, as proposed, the new reporting requirements would cause the agency to be inundated with reports of trivial damage from routine or unimportant occurrences which could result in important matters being obscured. 10. These commenters also state that their employees' efforts to locate and repair more serious areas of damage could suffer if they are busy completing and filing forms on less serious matters in the middle of an emergency. Thus, they urge the Commission to limit the damage reporting requirement to situations where there is severe damage causing serious disruption of service, and to exclude minor damage resulting from occasional third-party activities and disruptions resulting from routine maintenance. 11. The pipeline companies emphasize that, absent clarification and revision of the proposed regulations, the required reporting of damage to facilities could capture many events irrelevant to the Commission's objective in this rulemaking proceeding which, they believe, is to ensure timely identification of damage resulting from serious events that have the potential for impacts which, in the aggregate, may significantly undermine the integrity of the nation's gas infrastructure. 12. As examples of incidents for which immediate reporting generally is not necessary to achieve this objective, the pipeline companies note accidental backhoe damage from construction, a farmer's plow hitting a farm tap valve, compressor engine faults resulting in short periods of service disruption or reduction of throughput capability, corrosion and other damage revealed by regular inspections and requiring a temporary reduction in pressure until repairs can be made, and maintenance to replace equipment at the end of its useful life or worn out from wear and tear. The pipeline companies also discuss how much customer load is seasonal, so that a compressor failure or even a line break, on a looped line, may have no effect on customer service at all, depending upon when it happens. 13. In sum, the pipeline companies stress that, while minor incidents and accidents and routine maintenance may temporarily reduce available service or capacity through particular facilities, such incidents generally have no serious effect on the affected pipeline system's ability to meet its service obligations or on the national pipeline grid. These commenters believe that for these types of routine occurrences, which number in thousands each year for the pipeline industry as a whole, existing reporting requirements are sufficient. 15 Thus, these commenters request that the Final Rule's expansion of current reporting requirements be limited to significant damage from terrorism or natural disasters or other serious events significantly affecting operation of the affected pipeline system or the interstate pipeline grid. These commenters believe the Commission should focus on damage resulting in a loss of or reduction in a significant amount of firm service capacity— *e.g.* , firm service capacity of one million Dekatherms per day—for an extended period of time which, depending on the commenter, should be between three and 15 days. If the pipeline company believes a damaged facility can be fully restored to service within such time period, the commenters do not believe the new reporting requirements should apply unless, in the judgment of the pipeline company, the loss of or reduction in capacity of the damaged facilities is significantly impairing its ability to meet its customers' needs for natural gas service. 15 As discussed in the NOPR (at n. 9) and referenced by commenters, pipeline companies are required to submit reports of replacement facilities pursuant to 18 CFR 2.55(b) and annual reports of construction activities under the automatic provisions of the blanket certificate regulations in Part 157, Subpart F. Since these reports are annual reports due on or before May 1 of each year and hurricanes frequently occur in July, nine months can pass before a pipeline is required to report construction activities. Further, the information in these annual reports is not sufficient to determine whether a particular construction activity was undertaken due to damage to facilities resulting from a hurricane or other cause. In addition, while the emergency regulations in Part 284, Subpart I, require that the commencement of an emergency transaction be reported within 48 hours, the emergency regulations do not require the reporting of damage to facilities that may have made the emergency transaction necessary or reporting regarding facilities constructed to address the emergency. 14. Paiute Pipeline Company (Paiute), which operates a liquefied natural gas

(LNG)peak shaving plant in Nevada, requests that all jurisdictional LNG storage facilities be exempted from the proposed new reporting requirements. Paiute believes LNG storage operators already are subject to adequate reporting requirements that were imposed as conditions of the original authorizations for their LNG storage facilities. Paiute also notes that a June 23, 2006 letter from the Director of the Commission's Office of Energy Projects (OEP Director) to LNG storage operators clarified the Commission's applicable reporting conditions, which are similar to the reporting requirements prescribed by the U. S. Department of Transportation pursuant to 49 CFR Part 191 for LNG storage facilities. IV. Commission Response 15. On July 31, 2006, the U.S. Department of Energy

(DOE)released a report titled “Impact of the 2005 Hurricanes on the Natural Gas Industry in the Gulf of Mexico Region.” The report summarizes findings from Federal monitoring of the impact of Hurricanes Katrina and Rita on the natural gas industry in the Gulf of Mexico region from late August 2005 through early March 2006. It details the coordination of Federal agencies, including the Commission, and various natural gas industry personnel to track storm recovery efforts on a daily basis and identify disrupted natural gas flows and possible bypasses. 16. The July 31 report establishes insights into the complex supply delivery operation associated with offshore natural gas production and highlights the importance of accurate, timely information during supply-related emergencies. The report finds that 3,050 of the Gulf's 4,000 platforms and 22,000 of the 33,000 miles of Gulf pipelines were in the direct path of either Katrina or Rita, which caused destruction and substantial damage to offshore production platforms and pipelines, onshore production wells and pipelines, and other infrastructure supporting the Gulf production and delivery system. When active Federal monitoring of storm recovery efforts ended on March 8, 2006, production had returned to about 9 Bcf per day, with an estimated 9.4 percent of daily gas production remaining shut in as of June 19, 2006. 17. DOE's report illustrates and confirms the need for additional reporting requirements to ensure the Commission's timely gathering of information to monitor the status of the nation's gas infrastructure in emergency situations. Therefore, the Commission will adopt its proposal to revise § 260.9 of the regulations to require that natural gas companies report damage to jurisdictional facilities as the result of hurricanes and other natural disasters, such as earthquakes and floods, or terrorist activity. 18. The Commission recognizes that in many instances reporting by pipeline companies pursuant to the existing and new reporting requirements of § 260.9 will duplicate aspects of the initial telephonic and subsequent written pipeline incident reports required by DOT/Pipeline Safety. However, in view of the timing and format in which such reports are submitted to DOT/Pipeline Safety, the Commission cannot at the present time rely on those reports to meet its goals in monitoring emerging problems with gas infrastructure during and immediately following natural disasters or terrorist events. Further, while the Commission has already initiated consultation with DOT/Pipeline Safety regarding the possible development of a unified reporting system to meet the needs of the Commission, DOT/Pipeline Safety, the National Resource Center and other Federal agencies, such an initiative does not offer an immediate solution to the problem of duplicative reporting requirements, as the commenters acknowledge. 19. However, the Commission is revising the proposed regulations to narrow the scope of the new reporting requirements, since it was not our intention in the June 9 NOPR to require that pipeline companies immediately report incidents involving equipment failure, accidents and other situations which neither result in serious service interruptions (which are already subject to reporting under § 260.9) nor threaten a pipeline company's ability to meet its service obligations or otherwise significantly affect the integrity of the nation's gas infrastructure. While the commenters are correct that information relating to many such incidents is reflected in the annual construction reports pipeline companies are required to file, 16 our reason here for not requiring that these incidents be reported under § 260.9 is because immediate reporting in such instances is not crucial to our objective in this rulemaking proceeding of ensuring that our reporting requirements are adequate for timely gathering of information to monitor gas infrastructure in crisis situations that present serious threats to such infrastructure. Therefore, we will revise the proposed regulations to make clear that § 260.9 does not require the reporting of such incidents. 16 *Id.* 20. We do not agree, however, that our objectives can be met if we limit reporting under § 260.9 to damage to facilities only used for firm service or only in instances where throughput or capacity is reduced by more than a certain amount or the pipeline expects the facilities to be compromised for more than a few days. Since the new reporting requirements will be triggered by natural disasters or terrorist activity, the Commission will need all relevant information regarding damage to facilities and all affected pipeline systems. While a particular pipeline system may be able to take measures so that damage to its facilities does not cause that pipeline system to experience any immediate service interruptions, the damage on that pipeline system contributes to cumulative impacts that may significantly strain the gas infrastructure. Further, following a natural disaster or terrorist event, the Commission needs information on the status of all affected facilities, including facilities experiencing minimal damage, to facilitate the identification of possible paths for rerouting gas around more seriously damaged facilities. 21. In view of these considerations, the Commission is adopting new reporting requirements but is revising its proposal in the NOPR so that the additional reporting will be limited to requiring that pipeline companies report any damage to pipeline or storage facilities from a natural disaster or terrorist activity if such damage reduces pipeline throughput or storage deliverability. These limited new reporting requirements will ensure that the Commission has adequate, timely information to assess the status of gas infrastructure immediately following a natural disaster or terrorist event. However, as some commenters recognize, there may be other situations in which damage to pipeline and storage facilities creates the potential for destabilization of the gas infrastructure. Therefore, as a means of obtaining information regarding such occurrences without imposing overly inclusive reporting requirements that would unduly burden respondents, revised § 260.9 also will include a provision, as recommended by some commenters, to encourage pipeline companies to report any other damage which the pipeline companies, in their judgment, think creates the potential for serious delivery problems on their own systems or the pipeline grid. We are providing for this additional reporting in pipeline companies' discretion in recognition of their systems' wide variations in size, configuration, and levels and types of service. Incorporating a further level of discretion into the reporting provisions of § 260.9 is appropriate, since pipeline companies know their own systems and the nuances of their operations, and therefore can judge what other instances involving damage to facilities present the potential for significant problems on their own systems or the pipeline grid. 22. We also agree with Paiute's position that existing reporting requirements applicable to LNG storage operators are adequate, and that it is therefore appropriate to exclude damage to such facilities from the new reporting requirements in § 260.9. As emphasized by Paiute, when the Commission authorizes new LNG storage facilities under either section 3 of the NGA for imported LNG supplies or under section 7 of the NGA for liquefied domestic natural gas facilities, the Commission makes such authorization subject to specific reporting conditions. 17 These conditions require that an LNG storage operator report to Commission staff within 48 hours any significant non-scheduled event. 18 In the event an abnormality is of significant magnitude to threaten public or employee safety, cause significant property damage, or interrupt service, notification is required to be made immediately, provided that making such notification shall not unduly interfere with any necessary or appropriate emergency repair, alarm, or other emergency procedure. Further, on June 23, 2006, as noted by Paiute in its comments, the OEP Director sent all LNG storage operators a letter providing guidance and instructions for reporting significant incidents and reiterating and reinforcing the reporting conditions applicable to LNG storage operators. 17 *See,* *e.g.* , Sabine Pass LNG, L.P. and Cheniere Sabine Pass Pipeline Company, 109 FERC ¶ 61,324

(2004)at Appendix B, Environmental Condition 44. 18 Examples of reportable LNG-related incidents set forth in the conditions include, but are not limited to, fires; explosions; free flow of LNG for five minutes or more that results in pooling; unintended movement or abnormal loading by environmental causes, such as an earthquake, landslide or flood, that impairs the serviceability, structural integrity, or reliability of an LNG facility; any crack or other material defect that impairs an LNG facility's structural integrity or reliability; any malfunction or operating error that causes a dangerous rise in the pressure of an LNG facility; any leak that constitutes an emergency; or any safety-related condition that could lead to an imminent hazard and cause a 20 percent reduction in operating pressure or shutdown of operation of an LNG facility. 23. In view of the above-described reporting requirements already applicable to LNG facilities, the Commission agrees that it is not necessary to make the new reporting requirements of § 260.9 applicable to such facilities. Therefore, revised § 260.9 will specifically exclude the reporting of damage to LNG facilities. 24. However, Paiute's comments have caused the Commission to identify wording in existing and proposed § 260.9 which needs to be revised in order to avoid the potential for a significant gap in reporting. Specifically, the current and proposed wording of § 260.9 provide for the reporting of damage and service interruptions only with respect to natural gas facilities operated under “certificate” authorization from the Commission. Since import and export facilities authorized under section 3 of the NGA are not certificated facilities, § 260.9 does not explicitly address these facilities. In particular, the Commission is concerned that the reporting requirements of § 260.9 do not presently specifically apply to border crossing facilities authorized under NGA section 3. Such facilities, which are used to import or export gas between the United States and Canada or Mexico, are of national security interest, as evidenced by the requirement, pursuant to Executive Order Nos. 10485 and 12038, dated September 3, 1953, and February 3, 1978, respectively, and the Secretary of Energy's Delegation Order No. 00-004.00A, effective May 16, 2006, that applicants for such facilities must accept Presidential Permits granted by the Commission after consultation with the Secretary of State and the Secretary of Defense. 19 Under the conditions of a Presidential Permit, the President of the United States may determine that the safety of the United States demands that the United States take possession and control of any facilities operated under the Presidential Permit. 20 Section 260.9 is revised to ensure that NGA section 3 non-LNG facilities are subject to the reporting requirements. 19 *See,* *e.g.* , Clark Fork & Blackfoot, L.L.C. and EnCana Border Pipelines Limited, 115 FERC ¶ 61,131 (2006). 20 *Id.* , at Appendix, Presidential Permit, Article 10. V. Summary of Final Rule's Regulations 25. Section 260.9(a) currently requires that natural gas companies report serious service interruptions. The amended regulations add a new requirement to § 260.9 in revised subparagraph (a)(1) that natural gas companies report

(i)damage to natural gas facilities from a hurricane or other natural disaster or terrorist activity that results in loss of or reduction in pipeline throughput or storage deliverability, and

(ii)when the damaged facilities' pipeline throughput or storage deliverability has been fully restored. Section 260.9 also is amended, as reflected in revised subparagraph (a)(2), to provide that, in the event of damage to a natural gas company's jurisdictional natural gas facilities by reason other than hurricane, earthquake or other natural disaster or terrorist activity, the natural gas company should report such damage if, in the natural gas company's judgment, such damage creates the potential for serious delivery problems on its own system or the pipeline grid. 26. Section 260.9(b) is amended to remove the reference to “telegraph” and to require that natural gas companies make required reports of interruptions to service or damage to facilities by e-mail or, as currently provided for in § 260.9(b), facsimile transmission. All reports shall be due at the earliest feasible time after an interruption of service or damage to pipeline facilities for which a report is required pursuant to subparagraph (a)(1) or provided for in subparagraph (a)(2). 27. The information required by § 260.9(b) is revised to reflect the addition of the proposed new requirement that natural gas companies report damage to facilities and subsequently report when the damaged facilities have been repaired. Revised § 260.9(b) requires that a report of service interruption or damage to natural gas facilities state:

(1)The location of the service interruption or damage to natural gas pipeline or storage facilities;

(2)The nature of any damage to pipeline or storage facilities;

(3)Specific identification of the facilities damaged;

(4)The time the service interruption or damage to the facilities occurred;

(5)The customers affected by the service interruption or damage to the facilities;

(6)Emergency actions taken to maintain service; and

(7)Company contact and telephone number. 28. Section 260.9(b) also is revised to require that a company make a subsequent report stating when pipeline throughput or storage deliverability has been restored. 29. Section 260.9(d) is revised to change, from 20 days to 30 days following a service interruption or damage to facilities, the time within which a natural gas pipeline company must furnish to the Commission a copy of any incident report required to be made to the U.S. Department of Transportation under the Natural Gas Pipeline Safety Act of 1968. 30. Section 260.9(e) currently requires that a company send copies of reports of service interruptions to state commissions. Section 260.9(e) is revised by adding a new requirement that a company also must send state commissions copies of reports of damage to facilities required by revised subparagraph (a)(1)(i) and (ii). VI. Environmental Analysis 31. The Commission is required to prepare an Environmental Assessment or an Environmental Impact Statement for any action that may have a significant adverse effect on the human environment. 21 As stated in the NOPR, no environmental consideration is raised by promulgation of a rule that is procedural in nature or that does not substantially change the effect of legislation or regulations being amended. 22 The regulations adopted herein make changes to the type of information to be provided to the Commission by pipeline companies and the way it is provided, and slightly alter the timeframe (giving the companies more time) to file with the Commission a copy of the incident report required to be filed with the U.S. Department of Transportation. The modified procedures will not substantially change the regulatory requirements to which pipeline companies are currently subject. Accordingly, the preparation of an environmental document is not required. 21 Order No. 486, Regulations Implementing the National Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & Regs. Preambles 1986-1990 ¶ 30,783 (1987). 22 18 CFR 380.4(a)(2)(ii) (2006). VII. Regulatory Flexibility Act Certification 32. The Regulatory Flexibility Act of 1980

(RFA)23 generally requires a description and analysis of final rules that will have significant economic impact on a substantial number of small entities. The Commission is not required to make such an analysis if proposed regulations would not have such an effect. Under the industry standards used for the RFA, a natural gas pipeline company qualifies as a “small entity” if it has annual receipts of $6.5 million or less. 23 5 U.S.C. 601-612. 33. Most companies regulated by the Commission do not fall within the RFA's definition of a small entity. 24 Approximately 114 natural gas companies are potential respondents subject to the additional reporting requirements adopted by this rule. For the year 2004 (the most recent year for which information is available), 32 companies had annual revenues of less than $6.5 million. 24 5 U.S.C. 601(3), citing section 3 of the Small Business Act, 15 U.S.C. 623. Section 3 of the SBA defines a “small business concern” as a business which is independently owned and operated and which is not dominant in its field of operation. The Small Business Size Standards component of the North American Industry Classification System (NAICS) defines a small natural gas pipeline company as one that transports natural gas and whose annual receipts (total income plus cost of goods sold) did not exceed $6.5 million for the previous year. 34. Section 260.9 of the regulations already requires natural gas companies to report serious service interruptions. Thus, the new reporting requirements will only increase the number of reports that a company must file to the extent that damage to facilities is the result of a natural disaster or terrorist action and does not result in a loss of or reduction in service. Further, the required information will already be known and identified by companies and can be submitted either by e-mail or facsimile. While the revised provisions of § 260.9 also encourage natural gas companies to report damage to jurisdictional facilities as the result of occurrences other than natural disasters and terrorist activity if, in the natural gas company's judgment, such damage may create the potential for serious delivery problems on its system on the pipeline grid, such reporting is in the respondent's discretion. In view of these considerations, the Commission hereby certifies that this Final Rule's amendments to the regulations will not have a significant impact on a substantial number of small entities. VIII. Information Collection Statement 35. Office of Management and Budget

(OMB)regulations require that OMB approve certain reporting, record keeping, and public disclosure (collections of information) requirements imposed by agency rules. 25 Pursuant to OMB regulations, the Commission is submitting these reporting requirements to OMB for its review and approval under section 3507(d) of the Paperwork Reduction Act of 1995 (PRA). 26 Upon approval of a collection of information OMB will assign an OMB control number and an expiration date. Respondents subject to the filing requirements of this rule will not be penalized for failing to respond to these collections of information unless the collections of information display a valid OMB control number. 25 5 CFR 1320.11 (2005). 26 44 U.S.C. 3507(d) (2005). 36. Interested persons may obtain information on the reporting requirements by contacting: Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426 [Attention: Michael Miller, Office of the Executive Director, Phone:

(202)502-8415, fax:

(202)273-0873, e-mail: *michael.miller@ferc.gov* ]. 37. As discussed above, § 260.9 of the Commission's regulations already requires natural gas companies to report serious service interruptions. The new requirements will only increase the number of reports that a pipeline company is required to file to the extent that damage to facilities is the result of a natural disaster or terrorist activity and does not cause an interruption of service. Since these reports are event-driven, it is possible that there will be no additional reports filed at all if the pipelines do not experience any hurricane, other act of nature, or act of terrorism in a year. While the revised provisions of § 260.9 also encourage natural gas companies to report damage to jurisdictional facilities as the result of occurrences other than natural disasters and terrorist activity if, in the natural gas company's judgment, such damage may create the potential for serious delivery problems on its system on the pipeline grid, such reporting is in the respondent's discretion. 38. Information regarding damage to facilities will be readily ascertainable by companies and may be submitted either by e-mail or facsimile. Such electronic submission of reports will reduce the number of data entry errors, permit Commission staff to analyze data in a timely manner, and provide for storage of data on digital storage media. The new rule eliminates the no longer feasible option of filing by telegraph. It is expected that electronic filing will save time and resources since electronic filings require fewer personnel than are needed for paper processing and mailing. The integrity of the data should be improved because the Commission and companies subject to its jurisdiction will be able to correct errors more promptly. The Commission has initiated consultation with DOT/Pipeline Safety to pursue the commenters' recommendation that the Commission and other Federal agencies cooperate to develop a unified reporting system that would minimize duplicative filing requirements. 39. FERC-576, “Report of Service Interruptions,” identifies the Commission's information collection relating to Part 260, “Statements and Reports (Schedules),” of the regulations which apply to natural gas pipeline companies having facilities subject to the Commission's jurisdiction under the Natural Gas Act. This Final Rule establishes a new requirement that natural gas pipeline companies report damage to jurisdictional facilities as the result of natural disasters and terrorist activity and report when damaged facilities are fully restored to service. The regulations maintain the existing requirement that natural gas companies report serious interruptions of service and report restoration of service. The regulations also require natural gas pipeline companies to submit copies of required damage reports to relevant state agencies and maintain the requirement that copies of serious service interruptions be submitted to the relevant state agencies. The rule provides an additional 10 days for the pipeline company to file with the Commission a copy of any incident reporting form required to be filed within 30 days of the incident with the U.S. Department of Transportation pursuant to the Natural Gas Pipeline Safety Act of 1968. 40. *Public Reporting Burden:* Three commenters stated that the Commission's burden estimates in the NOPR were too low, 27 and five commenters felt that the requirements were overly broad and burdensome. 28 Further, six commenters stated their concerns about the duplication of the information that is provided to the Commission and to the Department of Transportation. 29 As discussed above, it was not the Commission's intention to require that natural gas companies report accidents, equipment failures or other occurrences having minimal effect on normal operations. Rather, the Commission's limited objective in adopting additional reporting requirements is to ensure that natural gas companies report damage as the result of hurricanes or other natural disasters or terrorist activities since these events present the potential for serious destabilization of the nations' gas infrastructure, as demonstrated following Hurricanes Katrina and Rita. Therefore, the Final Rule revises the proposed regulations to limit the scope of the new reporting requirements accordingly. Further, the Final Rule revises the proposed regulations to exclude LNG facilities from the scope of the reporting requirements under § 260.9, as recommended in the comments. Finally, while the Final Rule clarifies that the § 260.9 reporting requirements cover non-LNG facilities authorized under section 3 of the NGA, we have explained that there are few such facilities and they generally are limited to a few hundred feet of pipeline extending from the international borders. In view of these revisions and clarifications in this Final Rule, we find that the NOPR's estimates of reporting burden remain appropriate and believe that commenters' concerns should be assuaged. While the provisions of revised § 260.9 encourage natural gas companies to also report damage to jurisdictional facilities as the result of causes other than natural disasters and terrorist activity, if the natural gas company believes such damage presents the potential for causing serious delivery problems on its system or the pipeline grid, such additional reporting is not mandatory. 27 Boardwalk Pipeline, Williston Basin, and NiSource. 28 Duke Energy, Boardwalk Pipeline, Williston Basin, INGAA, and NiSource. 29 AGA, INGAA, Duke Energy, Boardwalk Pipeline, Williston Basin, and NiSource. 41. In light of the above discussion, the burden estimates for complying with the additional filing requirements of this rule pursuant to the procedures in the amended § 260.9 of the Commission's regulations are the same as estimated in the NOPR issued in this proceeding on June 9, 2006, as set forth below: Data collection Number of respondents Number of responses Hours per response Total hours FERC-576 15 35 2 70 *Total Annual Hours for Collection:* 70. These are mandatory information collection requirements. *Information Collection Costs:* The Commission sought comments about the time and corresponding costs needed to comply with this requirement. No comments were received. Because of the regional differences and the various staffing levels that will be involved in preparing the documentation (legal, technical and support) the Commission is using an hourly rate of $150 to estimate the costs for filing and other administrative processes (reviewing instructions, searching data sources, completing and transmitting the collection of information). The estimated annual cost is anticipated to be $10,500 (70 hours × $150). *Title:* FERC 576 “Report of Service Interruptions.” *Action:* Information Collection. *OMB Control No.:* 1902-0004. *Respondents:* Natural gas companies/business or other for-profit. *Frequency of Responses:* On occasion. *Necessity of Information:* The amended regulation revises the reporting requirements for service interruptions and damage to facilities subject to the Federal Energy Regulatory Commission's jurisdiction. The information filed with the Commission apprises it of serious pipeline service interruptions and also of serious damage to the nation's natural gas pipeline infrastructure. The amendment enhances this information by requiring filers to describe specifically which facilities have been damaged and how the damage occurred. 42. Comments on the Final Rule may also be sent to the Office of Management and Budget. For information on the requirements, submitting comments on the collection of information and the associated burden estimates including suggestions for reducing this burden, please send your comments to the Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426 (Attention: Michael Miller, Office of the Executive Director,

(202)502-8415; or send comments to the Office of Management and Budget (Attention: Desk Officer for the Federal Energy Regulatory Commission, fax: 202-395-7285, e-mail: *oria_submission@omb.eop.gov* , and reference this rulemaking Docket No. RM06-18-000 in your submission. IX. Document Availability 43. In addition to publishing the full text of this document in the **Federal Register** , the Commission provides all interested persons an opportunity to view and print the contents of this document via the Internet through FERC's Home Page ( *http://www.ferc.gov* ) and in FERC's Public Reference Room during normal business hours (8:30 a.m. to 5 p.m. Eastern time) at 888 First Street, NE., Room 2A, Washington DC 20426. From FERC's Home Page on the Internet, this information is available in the Commission's document management system, eLibrary. The full text of this document is available in eLibrary in PDF and Microsoft Word format for viewing, printing, and downloading. To access this document in eLibrary, type the docket number excluding the last three digits of this document in the docket number field. 44. User assistance is available for eLibrary and the FERC's Web site during normal business hours. For assistance, please contact Online Support at 1-866-208-3676 (toll free) or

(202)502-6652 (e-mail at *FERCOnlineSupport@FERC.gov* ), or the Public Reference Room at

(202)502-8371, TTY

(202)502-8659 (e-mail at *public.referenceroom@ferc.gov* ). X. Effective Date 45. These regulations are effective August 29, 2006. Section 553(d) of the APA 30 generally requires a rule to be effective not less than 30 days after publication in the **Federal Register** unless good cause is found to shorten the time period. The need for this rule to fill a gap in the Commission's reporting requirements was identified as the result of the Hurricanes Rita and Katrina. Another hurricane season is in progress. Therefore, it is crucial that this rule's reporting requirements be in effect immediately to ensure that the Commission has adequate information to monitor the nation's natural gas infrastructure and identify any gas supply delivery problems and possible paths to reroute gas supplies around facilities damaged by a hurricane. Accordingly, the Commission finds good cause to make this rule effective immediately upon publication in the **Federal Register** . 30 5 U.S.C. 553(d) (2006). XI. Congressional Notification 46. The Commission has determined, with the concurrence of the Administrator of the Office of Information and Regulatory Affairs of the Office of Management and Budget, that this rule is not a major rule within the meaning of section 351 of the Small Business Regulatory Enforcement Fairness Act of 1996. 31 The Commission will submit the Final Rule to both houses of Congress and the Government Accountability Office. 32 31 5 U.S.C. 804(2) (2000). 32 5 U.S.C. 801(a)(1)(A) (2000). List of Subjects in 18 CFR Part 260 Natural gas, Reporting and recordkeeping requirements. By the Commission. Magalie R. Salas, Secretary. In consideration of the foregoing, the Commission amends Part 260 of Chapter I, Title 18, Code of Federal Regulations, as follows. PART 260—STATEMENTS AND REPORTS (SCHEDULES) 1. The authority citation for part 260 continues to read as follows: Authority: 15 U.S.C. 717-717w, 3301-3432; 42 U.S.C. 7101-7352. 2. Section 260.9 is amended by revising the section heading and paragraphs (a), (b),

(d)and

(e)to read as follows: § 260.9 Reports by natural gas pipeline companies on service interruptions and damage to facilities. (a)(1) Every natural gas company must report to the Director, Division of Pipeline Certificates, at the earliest feasible time:

(i)Damage to any jurisdictional natural gas facilities other than liquefied natural gas facilities caused by a hurricane, earthquake or other natural disaster or terrorist activity that results in a loss of or reduction in pipeline throughput or storage deliverability; and

(ii)Serious interruptions of service to any shipper involving jurisdictional natural gas facilities other than liquefied natural gas facilities. Such serious interruptions of service shall include interruptions of service to communities, major government installations and large industrial plants outside of communities or any other interruptions which are significant in the judgment of the pipeline company. Interruptible service interrupted in accordance with the provisions of filed tariffs, interruptions of service resulting from planned maintenance or construction and interruptions of service of less than three hours duration need not be reported.

(2)In the event of damage to a natural gas company's jurisdictional natural gas facilities other than liquefied natural gas facilities by reason other than hurricane, earthquake or other natural disaster or terrorist activity, the natural gas company should report such damage if, in the natural gas company's judgment, such damage creates the potential for serious delivery problems on its own system or the pipeline grid.

(b)Any report of damage to facilities required by paragraph (a)(1)(i) of this section, any report of service interruption required by paragraph (a)(1)(ii) of this section and any report made pursuant to paragraph (a)(2) of this section in a natural gas company's discretion must be submitted by the natural gas company by e-mail to *pipelineoutage@ferc.gov* or by facsimile transmission to the Director, Division of Pipeline Certificates, Office of Energy Projects at FAX number

(202)208-2853.

(1)Reports required by paragraph (a)(1)(i) or

(ii)or made in a natural gas company's discretion pursuant to paragraph (a)(2) shall be made at the earliest feasible time and must state:

(i)The location and cause of the service interruption or damage to natural gas pipeline or storage facilities;

(ii)The nature of any damage to pipeline or storage facilities;

(iii)Specific identification of any facilities damaged;

(iv)The time the service interruption or damage to facilities occurred;

(v)The customers affected by the interruption of service or damage to facilities;

(vi)Emergency actions taken to maintain service; and

(vii)Company contact and telephone number.

(2)Following a report required by paragraph (a)(1)(i) of this section of damage to natural gas facilities resulting in loss of pipeline throughput or storage deliverability or a report pursuant to paragraph (a)(2) of this section in a natural gas company's discretion, the natural gas company shall report to the Director, Division of Pipeline Certificates, at the earliest feasible time when pipeline throughput or storage deliverability has been restored.

(d)In any instance in which an incident or damage report involving jurisdictional natural gas facilities is required by Department of Transportation reporting requirements under the Natural Gas Pipeline Safety Act of 1968, a copy of such report shall be submitted to the Director, Division of Pipeline Certificates, within 30 days of the reportable incident.

(e)When a report of damage to facilities is required by paragraph (a)(1)(i) of this section or a report of service interruption is required by paragraph (a)(1)(ii) of this section, a copy of the e-mail or facsimile report required pursuant to paragraph

(b)of this section must be sent to each State commissions for the States in which the reported service interruptions or damage has occurred. [FR Doc. E6-14281 Filed 8-28-06; 8:45 am] BILLING CODE 6717-01-P DEPARTMENT OF JUSTICE Drug Enforcement Administration 21 CFR Parts 1301 and 1309 [Docket No. DEA-266F] RIN 1117-AA96 Controlled Substances and List I Chemical Registration and Reregistration Application Fees AGENCY: Drug Enforcement Administration (DEA), Department of Justice. ACTION: Final Rule. SUMMARY: This final rule establishes the fee schedule for DEA registration and reregistration fees relating to the registration and control of the manufacture, distribution and dispensing of controlled substances and listed chemicals to appropriately reflect all costs associated with its Diversion Control Program for the conduct of activities as mandated by 21 U.S.C. 822 and 958. Specifically, this final rule revises the fee schedule for controlled substances and List I chemical handlers so that all manufacturers, distributors, importers, exporters, and dispensers of controlled substances and of List I chemicals pay an annual fee, by registrant category, irrespective of whether they handle controlled substances or List I chemicals. In doing so, this rule implements clarifications to the Diversion Control Program and the Diversion Control Fee Account made by Congress in the Consolidated Appropriations Act of 2005 (Pub. L. 108-447) that amended 21 U.S.C. 886a. EFFECTIVE DATE: This rule is effective November 1, 2006. The new fee schedule will be in effect for all new applications postmarked on or after November 1, 2006 and for all renewal applications postmarked on or after November 1, 2006. FOR FURTHER INFORMATION CONTACT: Mark W. Caverly, Chief, Liaison and Policy Section, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537; Telephone

(202)307-7297. SUPPLEMENTARY INFORMATION: I. Background and Statutory Authority The Drug Enforcement Administration published a Notice of Proposed Rulemaking in the **Federal Register** on November 16, 2005 (70 FR 69474) to adjust the registration and reregistration fees for controlled substances and List I chemical handlers. The Controlled Substances Act

(CSA)requires that all manufacturers, distributors, dispensers, importers and exporters of controlled substances and List I chemicals obtain an annual registration with DEA (21 U.S.C. 822 and 958(f)). In addition, the CSA, as codified in 21 U.S.C. 821, authorizes the Attorney General, who in turn redelegates this authority to the Administrator of DEA, to “promulgate rules and regulations and to charge reasonable fees relating to the registration and control of the manufacture, distribution, and dispensing of controlled substances and listed chemicals” (21 U.S.C. 821 as amended by Pub. L. 108-447). In October 1992, Congress passed the Departments of Commerce, Justice and State, the Judiciary and Related Agencies Appropriations Act of 1993 which changed the source of funding for DEA's Diversion Control Program

(DCP)from being part of DEA's Congressional appropriation to full funding by registration and reregistration fees through the establishment of the Diversion Control Fee Account (DCFA). The Appropriations Act of 1993 required that “[f]ees charged by the Drug Enforcement Administration under its diversion control program shall be set at a level that ensures the recovery of the full costs of operating the various aspects of that program.” The legislation did not, however, provide clarification on what constituted the “Diversion Control Program,” thus leaving open the issue as to what fee-setting criteria should be used to determine which costs could be reimbursed from the DCFA. In response to the Appropriations Act of 1993, DEA published a Notice of Proposed Rulemaking

(NPRM)in December 1992 to adjust the registration and reregistration fees for controlled substance registrants (57 FR 60148, December 18, 1992). In the absence of guidelines from Congress regarding the specific criteria to be followed in identifying costs and setting the fees, DEA relied on the plain language of the Appropriations Act of 1993 and proposed fees necessary to cover the costs of the activities that were identified within the budget decision unit known as the “Diversion Control Program.” At the time that the Appropriations Act of 1993 was passed, 21 U.S.C. 821 did not extend to chemical control activities; accordingly, there were no registration or fee requirements for handlers of listed chemicals. DEA therefore excluded chemical control costs from its Final Rule implementing the requirements of the Appropriations Act of 1993 (58 FR 15272, March 22, 1993). Congress amended 21 U.S.C. 821 on December 17, 1993 to require reasonable fees relating to “the registration and control of regulated persons and of regulated transactions” (Domestic Chemical Diversion Control Act of 1993, 3(a), Pub. L. 103-200, 107 Stat. 2333); however, despite this amendment, DEA continued to endeavor to maintain separate funding for its controlled substances diversion control and its chemical diversion control activities. That is, DEA has paid for its controlled substance diversion control activities through the Diversion Control Fee Account and registration fees and its chemical diversion control activities through appropriated funds. Following publication of DEA's Final Rule, the American Medical Association

(AMA)and others filed a lawsuit objecting to the increase in registration and reregistration fees on the grounds that DEA had failed to provide adequate information as to what activities were covered by the fees and how they were justified. Upon appeal, the United States Court of Appeals for the District of Columbia Circuit remanded, without vacating, the rule to DEA, requiring the agency to provide an opportunity for meaningful notice and comment on the fee-funded components of the DCP. In doing so, the court confirmed the boundaries of the DCP that DEA can fund by registration fees, finding that the current statutory scheme (21 U.S.C. 821 and 958) required DEA to set reasonable registration fees to recover the full costs of the DCP. ( *AMA* v. *Reno,* 57 F.3d 1129, 1135 (DC Cir. 1995)). Thus, in the absence of a simple, objective measure by which DCP costs could be identified and the appropriate fees calculated, both DEA and the courts have looked to 21 U.S.C. 821 and 958 to define the guidelines for determining what costs should be included in the calculation of the fees and from whom the fees might be collected. On November 20, 2004, Congress passed the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act of 2005 which provided clarification as to the activities constituting the DCP. This Act was included in the Consolidated Appropriations Act of 2005, which was signed into law by the President on December 8, 2004 (Pub. L. 108-447). The Act amended 21 U.S.C. 886a to define the Diversion Control Program as “the controlled substance and chemical diversion control activities of the Drug Enforcement Administration,” which are further defined as the “activities related to the registration and control of the manufacture, distribution and dispensing, importation and exportation of controlled substances and listed chemicals.” It also amended the section to provide that reimbursements from the DCFA “* * * shall be made without distinguishing between expenses related to controlled substances activities and expenses related to chemical activities.” Finally, the Act amended 21 U.S.C. 821 and 958(f) to make the language of those sections consistent with the definition of the DCP (Pub. L. 108-447). The net effect of the amendments is to allow DEA to deposit all registration and reregistration fees (controlled substance and chemical) into the Fee Account and fund all controlled substance and chemical diversion control activities from the account without distinguishing as to the type of activity (controlled substance or chemical) being funded. While the comingling of controlled substances diversion control and chemical diversion control fees and activities might seem initially to be incongruous, there is, in fact, a significant amount of overlap, both in terms of activities and registrant populations. While it is easy to distinguish between handlers of controlled substances and the handlers of commodity chemicals such as red phosphorous, hydriotic acid, acetic anhydride and nitroethane, the line between handlers of controlled substances and handlers of drug products that contain listed chemicals is blurred considerably. Not only are the drug products that contain List I chemicals often manufactured by controlled substances manufacturers, they are commonly distributed by controlled substances distributors and routinely sold or dispensed by pharmacies, hospitals, and individual practitioners. In calendar year 2004, there were over 30 million prescriptions filled for drug products containing the List I chemicals ephedrine, pseudoephedrine, and phenylpropanolamine, which is still routinely used in veterinary products. There are undoubtedly many instances in which practitioners also provided their patients with free samples of allergy and cough and cold preparations that contain those chemicals. Within this general environment, the use of a single, unified account to fund the controlled substances and chemical diversion control activities of DEA is consistent with the mandates of the law. DEA is bound by all of the above-referenced statutory requirements in setting fees that recover the “full cost” of the Diversion Control Program and its activities, as defined in the most recent lawmaking action. Therefore, DEA has developed this rulemaking according to these legislative mandates. II. Comments Received Following publication of the Notice of Proposed Rulemaking on November 16, 2005, DEA received 12 comments to the notice. Three comments were received from practitioners (one physician, one physician assistant, and one dentist); three comments were received from manufacturers or distributors; five comments were received from organizations representing different registrant groups; and one comment was submitted anonymously. Most commenters raised concern about the increase in fees, particularly for chemical registrants. Two commenters in particular wrote that the increase in fees will have a significant impact on chemical registrants compared to current fee rates and proposed an alternative fee increase. One commenter wrote that programs within DEA should be downsized or eliminated to maintain a “neutral budget” and keep costs lower. Three commenters expressed concern that the fee increase is coming at a time when Congress and other entities are re-evaluating medical reimbursements; one physician commented that he would pay the new fee as soon as his reimbursements increased by the same percentage. Another expressed concern that the cost of the increased fees would discourage physicians from registering with DEA and using controlled substances, thus affecting patient care. Five commenters objected to the removal of the waiver of the chemical registration requirement for controlled substances registrants that handle drug products that are regulated as List I chemicals. The commenters wrote that they believed removal of this waiver would damage the ability of affected registrants to service their customer base and posed an unreasonable hardship. Two commenters also noted that removal of the waiver could create expensive administrative burdens for both registrants and for DEA. Two registrants objected to the existing fee exemption for certain entities such as some Federal agencies, certain charitable organizations, law enforcement entities, and military personnel. Commenters noted that exempting these organizations results in larger fees for fee-paying registrants and requested reevaluation of this policy by DEA. Two commenters raised the issue of performance standards tied to the increase in fees and requested clarification on DEA's expected outcomes as a result of the increased fees and the performance measures and metrics DEA has established to assess these outcomes. One commenter wrote that the required $15 million annual transfer to the U.S. Treasury out of collected fee funds was a significant percentage of the total fees collected, and the commenter urged DEA to request that Congress resume its annual $15 million appropriation to offset this transfer. The commenter wrote that it, too, would work to see this appropriation restored. One anonymous commenter wrote that medical marijuana is “most popular in California especially with grayhaired men and women.” Marijuana is not a licit controlled substance or listed chemical covered by this rulemaking and is not affected by this final rule; accordingly, this comment is not further addressed in this section. Another commenter, a practitioner, submitted a request for reregistration materials through the comment response vehicle. These materials were provided to the commenter, and this matter is not addressed further in this rulemaking. Three commenters requested that DEA extend implementation of the final rule, noting that the rule comes in the middle of budget cycles for many registrants who had not planned for increased fees as part of their budgets and that it also comes at a time of statutory and other change for the industry. Each of these comments is addressed below. III. Objection to Fee Increase Nine of the twelve comments received by DEA expressed opposition to the increase in fees. As described above, 21 U.S.C. 821 (as amended by Pub. L. 108-447) authorizes DEA to collect reasonable fees relating to the registration and control of the manufacture, distribution and dispensing of controlled substances and listed chemicals. In addition, the 1993 Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act that established the Diversion Control Fee Account

(DCFA)specifically mandated that fees “shall be set at a level that ensures the recovery of the full costs of operating the various aspects of that program” (21 U.S.C. 886a(3)). Congress, in using the mandatory term “shall” as opposed to the discretionary “may,” unambiguously required DEA to increase its then-existing registration fees resulting in registrants fully funding DCP expenses. DEA, therefore, lacks discretion in this matter and must fund the DCP totally from registration fees (that is, not from fines, Congressional appropriations or other potential sources). Accordingly, while DEA recognizes the economic pressures facing practitioners, such as declining Medicaid reimbursements and increasing operating, equipment, and insurance costs, the current statutory scheme requires DEA to set registration fees to recover the full costs of the DCP, while limiting DEA to charge “reasonable” fees relating to the registration and control of the manufacture, distribution and dispensing of controlled substances and listed chemicals. DEA does not have the discretion to partially fund the DCP or to find alternative sources of funding for the program. Rather DEA is mandated by law to fund the DCP fully through registration fees. The registration fees outlined below are set at a level to support the full costs of the DCP as mandated by law. With clarification of the activities constituting the DCP in the Appropriations Act of 2005, DEA is now required to evaluate the “full costs” of the DCP to include all controlled substances and all listed chemical diversion control activities; whereas, previously the only DCP costs supported through registrant fees were controlled substances diversion control costs, and listed chemical diversion control activities were supported through appropriated funds. (See the Notice of Proposed Rulemaking published on November 17, 2005, 70 FR 69474) for additional discussion on this separation of activities.) In fact, operating the DCP as a cohesive whole, that is without distinction in activities between controlled substances and chemical diversion control activities, offers scale efficiencies and ultimately cost savings and improved services for registrants. The fees set forth in this final rule reflect calculation of the full costs of both the controlled substances and chemical diversion control activities of the DCP. The revised fee structure contained in this final rule includes annual fees (or fee equivalent) ranging from $184 to $2,293. DEA recognizes that the increase in fees may represent a budgeting challenge for registrants, particularly registrants with multiple sites requiring separate registrations ( *e.g.,* chain drug stores), however, because the fees do not represent a significant financial burden on registrants, DEA has determined that the fees contained in this final rule are reasonable. DEA expects that among all registrants, mid-level practitioners and chemical distributors may feel the greatest impact of the new fees (see discussion in Section XII). However, for most registrants qualifying as small businesses the revised fee will have a minimal impact, representing from 0.28 percent to as little as 0.01 percent of average annual sales (or income). For registrants that are large businesses with higher annual sales, the impact of the fee is far less. A. Differences in Fee Increase Among Registrant Categories Two commenters expressed concern that the fees for chemical registrants under this final rule reflect a higher percentage increase than the change in fees for controlled substances registrants. Commenters noted that fees for chemical manufacturers will increase by approximately 300 percent and that fees for chemical distributors will increase by about 100 percent compared to the current fee structure for these chemical registrants. Commenters proposed an alternative fee increase for these categories based on the same percentage increase as controlled substances manufacturers and distributors. Currently, chemical handlers pay a user fee that supports only the costs of registration/reregistration and some administrative oversight—not the operating costs of the DEA's chemical diversion control program. With the transfer of DEA's chemical control program costs to the DCFA, chemical registrants must, together with controlled substances registrants, pay a fee to cover the full costs of the DCP. The same circumstance occurred in 1993 with the establishment of the DCFA; controlled substances registrants were faced with a substantial increase in their fees as they transferred from a similar user fee that supported registration costs only to a fee schedule to cover the full costs of DEA's controlled substances diversion control activities. With the transfer of the chemical control program costs to the DCFA and the amendments to the law that reimbursements shall be made without distinguishing between chemical and controlled substances activities, chemical registrants must now be included in the DCFA population and pay the fees necessary to sustain that account. DEA does not have the discretion to adjust fees according to percentages, such as was proposed by the commenters, as it is required to fully fund the DCP through fees paid by the registrants while also maintaining reasonable fees. B. Program Costs One commenter suggested that DEA downsize or eliminate programs to maintain a neutral budget and keep fees low. DEA works diligently to achieve administrative efficiencies in all of its programs, including the Diversion Control Program. Through a scheduled, periodic review process, virtually all aspects of the DCP are inspected to detect any waste, fraud or abuse. All expenditures charged to the DCFA also are reviewed and approved by an independent unit within DEA that reviews, approves, and audits fee-funded expenditures. Moreover, each of DEA's annual budget requests to Congress, which contain all components of each DEA program, including the DCP, is available for public review. Each budget request is examined and approved by both the Department of Justice and the Office of Management and Budget. DEA has undertaken several initiatives to streamline aspects of the DCP both for DEA and for registrants. For example, DEA is developing a system to permit the electronic transmission of controlled substances prescriptions through electronic creation, signature and record retention, which will significantly increase the efficiency by which prescriptions are transmitted from prescriber to pharmacy; however, it will not reduce the review requirements of DEA employees that monitor the prescription process for controlled substances. DEA has developed a system that permits the electronic transmission of controlled substances orders which provides increased efficiencies for industry. Moreover, in 2005, DEA underwent an internal reorganization to increase operational efficiencies and keep costs as low as possible. This reorganization shifted the focus from business decision units to activities that support the registration and control of the manufacture, distribution, and dispensing of controlled substances and listed chemicals. However, DEA is also subject to costs related to inflation and additional costs of “doing business” that face all organizations despite its best efforts to keep these expenses reasonable. C. Effect of Fee Increase on Practitioner Registration One practitioner commenter noted concern that increases to annual registrant fees could reduce the number of physicians registering with DEA and using controlled substances as part of patient care. The Controlled Substances Act requires that every person who manufactures, distributes or dispenses any controlled substance or who proposes to engage in the manufacture, distribution or dispensing of any controlled substance obtain an annual registration (21 U.S.C. 822(a)(1) and 822(a)(2)). DEA notes that the impact of the annual registration fee on practitioners ($184 annual equivalent) is not significant, ranging from a high of 0.28% to a low of 0.13% based on annual income for this registrant category (see discussion below on small business impacts). The majority of registered practitioners (71 percent) are physicians whose annual income averages more than $140,000 and for whom the $184 annual fee equivalent represents approximately 0.13 percent of annual income. Other large practitioner groups in this category include dentists (16 percent of practitioners) for whom the annual fee equivalent represents about 0.14 percent of their average annual income of $133,000 and veterinarians (5 percent of practitioners) for whom the annual fee equivalent equates to 0.25 percent of their average annual income of $76,000. The revised fee will have greater impacts on other types of practitioners (less than 5 percent of all registered practitioners) with lower annual incomes, including nurse practitioners, physician assistants, optometrists, and others for whom the annual fee equivalent has an average impact of approximately 0.16-0.28 percent. IV. Removal of Waiver for Chemical Registrants Holding an Existing Controlled Substances Registration Four commenters objected to the removal of the waiver of the registration requirement for persons who distribute, import or export a drug product containing a List I chemical if that person is already registered with DEA to manufacture, distribute or dispense, import or export a controlled substance. Commenters noted that removal of this waiver could dramatically increase the annual registration fees for affected registrants and would damage their ability to service their customers, would pose an “unreasonable hardship,” and could adversely affect the List I chemical supply chain since many affected registrants also hold a controlled substances registration. One commenter also noted that removal of this waiver could require significant changes to internal operations for affected registrants who would have to maintain two DEA registrations, imposing significant paperwork, technological and operational burdens. The commenter also suggested removal of the waiver could result in increased operational burdens for DEA. After careful review of these comments and consideration of the benefits compared to the drawbacks associated with removal of this waiver, DEA has decided to retain the current registration waiver for persons who distribute, import, or export a product containing a List I chemical who already hold a valid DEA registration to manufacture, distribute or dispense, import, or export a controlled substance. Accordingly, the proposed changes to the waiver provision are removed. DEA will address registration issues created by passage of the Combat Methamphetamine Epidemic Act of 2005, included in the USA PATRIOT Improvement and Reauthorization Act of 2005 (Pub. L. 109-177) as part of the Act's implementing regulations. V. Registration Fee Waivers for Certain Organizations and Persons Two commenters objected to DEA's fee exemption for certain entities and persons. Currently, government institutions, law enforcement agencies, and military personnel are exempt from fees. In addition, DEA waives fees for some charitable organizations. The commenters objected to these fee waivers suggesting that the process is inequitable and that the net result is higher fees for fee-paying registrants than if these organizations were also required to pay annual registration and reregistration fees. The commenters also asserted that fee-paying registrants are paying a “hidden contribution” or “forced donation” to charitable organizations, without tax relief, by partially subsidizing their fee requirements. DEA appreciates these comments. DEA recognizes that exempting certain entities from paying annual fees provides a benefit to some at the expense of others and is evaluating its current practice of exempting certain organizations and persons from annual registration fees. Any changes to this practice will require a separate regulatory process, including notice and comment. VI. Performance Standards Two commenters objected to the omission of anticipated outcomes or results expected by DEA as a result of the increased fees. The commenters requested detail on how DEA will track such results and correlate them to the higher fees while recommending the development of a system of metrics, accountability and reporting for the DCP. The Government Performance and Results Act

(GPRA)and the President's Management Agenda (PMA), requires DEA, like all other agencies and components, to provide a budget summary that incorporates performance information on a quarterly basis. In response to these requirements, DEA already integrates budget and performance in order to evaluate the effectiveness of programs relative to long-term, measurable outcome goals. More specifically, in response to GPRA and the PMA, the DCP's budgetary reporting on outlays from the DCFA includes performance measures that are consistent with DEA's Strategic Plan and that reflect the effectiveness of programmatic activities funded by registrant fees. Among the objectives included in DEA Strategic Plan is continued support to the registrant population through improved technology, including E-commerce and customer support, while maintaining cooperation, support, and assistance from the regulated industry. These efforts, funded through registration fees, are intended to provide benefits to the registrant population such as streamlined processing and improved access to information. They are also intended to reduce the paperwork burden on small businesses; reduce forged or stolen prescriptions; improve authentication and verification of the prescribing or ordering party and reduce processing time; increase overall security; and improve DEA's data quality, agency efficiency and responsiveness in carrying out its mission. All budget submissions for the Diversion Control Program, like submissions for all programs across DEA, are subject to multiple levels of scrutiny and review within DEA, the Department of Justice, and the Office of Management and Budget before being included in the President's annual Budget Request to Congress. VII. $15 Million Treasury Transfer One commenter urged DEA to request that Congress resume the annual $15 million appropriation to offset the requirement that the first $15 million in fee collections be transferred to the Treasury, so that all fee funds may be used for DCP activities. The commenter noted that the annual $15 million transfer represents a “significant component” of the amounts to be collected each year. The Appropriations Act of 1993 requires that DEA transfer the first $15 million of fee revenue to the General Fund of the Treasury each year (21 U.S.C. 886a(1)). For each fiscal year from Fiscal Year 1993 through Fiscal Year 1998, Congress appropriated an additional $15 million to offset this requirement (a total infusion to the DCFA of $90 million). However, beginning in Fiscal Year 1999, Congress discontinued this additional appropriation. Accordingly, since Fiscal Year 1999, DEA has to include the annual $15 million transfer for fee calculations; that is, DEA must pay for all operational costs of the DCP plus the $15 million transfer out of fee funds collected from registrants. VIII. Extension of Implementation of the Final Rule Three commenters requested delay of implementation of the final rule to Fiscal Year 2007 or later. Two commenters requested the delay because of the potential effects of removal of the registration waiver for chemical handlers holding a current controlled substance registration. Following careful review of comments, DEA has decided to keep this waiver intact (see discussion above). Three commenters requested the delay because of ongoing changes in the industry, including pending state and Federal legislation affecting over-the-counter products containing listed chemicals (such as products containing pseudoephedrine and ephedrine). One commenter noted that such pending legislation could affect distributors carrying these products and therefore DEA registrations and revenue projections. The commenters also noted that the fee modifications are coming at a time when Congress, Federal agencies, and private party payers are exploring methods for reducing reimbursement for prescription drugs. Two commenters wrote that implementation of the final rule would come in the middle of budget cycles for affected registrants and would, therefore, impose financial challenges because of the unanticipated additional expenses in the annual fees, particularly for chain drug stores with many separately registered sites. DEA notes that very few chain registrants have registrations expiring during the current calendar year, thus limiting the potential impact of the fee increase in the current budget cycle. With respect to pending legislation and its possible effect on DEA registrations, DEA takes into account the potential ebb and flow of the registrant population through the retirement of old registrations and new applications for registration when calculating the fees. DEA cannot delay implementation of the new fee schedule as the agency is required, by statute, to recover the full costs of the diversion control program through registration fees. IX. Overview of Diversion Control Program Responsibilities The mission of DEA's Diversion Control Program

(DCP)is to enforce the provisions of the Controlled Substances Act as they pertain to ensuring the availability of controlled substances and listed chemicals for legitimate uses in the United States while exercising controls to prevent the diversion of these substances and chemicals for illegal uses. DCP activities include: Program priorities and field management oversight; coordination of major investigations; drafting and promulgating of regulations relating to the enforcement of the CSA and other legislation; establishment of national policy on diversion; fulfillment of U.S. obligations under drug control treaties; advice and leadership on state legislation/regulation; legal control of drugs and chemicals not previously under Federal control; control of imports and exports of licit controlled substances and chemicals; and program resource planning and allocation, among other activities. As was outlined in the Notice of Proposed Rulemaking, DCP activities funded to date out of the DCFA have been limited to controlled substances diversion control activities, including controlled substances scheduling, registration, investigation, inspection, data collection and analysis, training, establishing production quotas, cooperative efforts with state, local and other Federal agencies, cooperative efforts with the regulated industry, international activities relating to the registration and control of the manufacture, distribution and dispensing of controlled substances, and attendant management, personnel, administrative and clerical oversight for the DCP. Fee-fundable activities also have included travel, rent, utilities, supplies, equipment, and services associated with the above-listed activities and activities related to the control of licit controlled substances in the U.S. in which the initial source is foreign. One commenter wrote that administrative expenses should not be paid for out of the DCFA and fee funds; however, the courts have found that all activities and expenses that are directly related to diversion control may be funded with registration and reregistration fees ( *AMA* v. *Reno,* 57 F.3d 1129, 1135 (DC Cir. 1995)). Administrative and other operational costs are directly related to the ongoing diversion control efforts of the DCP. With the inclusion of the chemical diversion control activities in the DCFA and registrant fees by the Appropriations Act, activities related to the overall control of listed chemicals, registration, investigation, inspection, data collection and analysis, cooperative efforts with the regulated industry, related management and administrative positions devoted to diversion control activities, other personnel, and administrative and clerical oversight have been included in the budget calculations that are used to determined the registration fees. For detail on the specific DCP components to be funded through the DCFA and their associated costs for the Fiscal Year 2006-2008 period covered by this rulemaking, please see DEA's Notice of Proposed Rulemaking, published in the **Federal Register** on November 16, 2005 (70 FR 69474). X. Budget Changes In calculating the registration and reregistration fees contained in this Final Rule, DEA has included all DCP activities associated with the “registration and control of the manufacture, distribution and dispensing, importation and exportation of controlled substances and listed chemicals” (Pub. L. 108-447). As discussed in detail in the Notice of Proposed Rulemaking (70 FR 69474), beginning in Fiscal Year 2006, both controlled substance and chemical diversion control costs must be included in the calculation of DCFA registration and reregistration fees. Among the chemical diversion control costs to be included among the “full costs” of operating the DCP are a portion of the Office of Training

(TR)that specifically supports the activities of the DCP by providing training, guidance and instruction for Diversion Investigators, Diversion Task Force Officers, regulatory agencies, state and local law enforcement, and DCP personnel on controlled substances and chemical diversion control, advanced skills and technical knowledge, and systems applications. Also included are 188 chemical diversion control positions; 12 overseas diversion investigators dedicated to the DCP; and costs associated with the chemical transaction system (CTRANS). The chemical diversion control costs that will be supported through the DCFA total $24,499,000 for Fiscal Year 2006, $24,880,000 for Fiscal Year 2007, and $25,235,000 for Fiscal Year 2008, accounting for salary growth and inflation. In addition to the chemical control costs, DEA is including among fee-fundable activities certain other internal resources that support the DEA's diversion control activities, but that, as was discussed more fully in previous rulemakings regarding the DCFA, had previously been supported through appropriated funds despite their direct relationship to and support of the DCP. These activities include portions of the Office of Chief Counsel, the Office of Forensic Sciences Special Testing Laboratory, and the Special Operations Division; and additional special agent and intelligence analyst costs not previously supported through the DCFA. These components and associated costs are described below. A portion of DEA's internal computer system, Firebird, which already is supported through the DCFA, is included in the fee-fundable cost. The total cost of these non-chemical additions for Fiscal Year 2006 is $26,996,000; for Fiscal Year 2007 is $31,198,000; and for Fiscal Year 2008 is $34,736,000. In calculating the revised fee schedule, DEA used the Fiscal Year 2006 enacted Appropriation, the President's Budget Request for Fiscal Year 2007, the expected Budget Request for Fiscal Year 2008, and the annual $15 million transfer to the U.S. Treasury as mandated by the CSA (21 U.S.C. 886a). In addition to fee funding all program elements and activities related to the registration and control of the manufacture, distribution, dispensing, importation, and exportation of controlled substances and listed chemicals, DEA must transfer the first $15 million of fee revenue to the General Fund of the Treasury each year as described above (21 U.S.C. 886a(1)). The Fiscal Year 2006 cost of the DCP is $201,673,000, including a base of $150,178,000 for controlled substances diversion control activities, $24,499,000 in chemical diversion control activities, and $26,996,000 for the additional non-chemical DCP support activities outlined above and described in detail in the November 16, 2005 Notice of Proposed Rulemaking (70 FR 69474), including 52 additional special agent positions; a portion of the Forensic Sciences Special Testing Laboratory; a portion of the Office of Chief Counsel that directly supports diversion control activities; 34 of the 67 field intelligence analysts to be phased in between Fiscal Year 2006-2007 and 6 Headquarters intelligence analysts to support domestic and international diversion control investigations (the remaining 33 field intelligence analysts will be phased in during Fiscal Year 2007); a portion of the Special Operations Division directly related to diversion control efforts; and Firebird operations costs to support communication and infrastructure of the diversion control program. With the addition of the required $15 million transfer to the U.S. Treasury, the total amount necessary to collect through registrant fees in Fiscal Year 2006 is $216,673,000. The DCP cost for Fiscal Year 2007, including all activities relating to the registration and control of the manufacture, distribution and dispensing of controlled substances and listed chemicals, is $212,078,000, as reflected in the President's Budget Request to Congress. Including the required $15 million transfer to the U.S. Treasury, the total amount necessary to collect through registrant fees in Fiscal Year 2007 is $227,078,000. The anticipated costs of the DCP for Fiscal Year 2008, including all activities relating to the registration and control of the manufacture, distribution and dispensing of controlled substances and listed chemicals, is $218,669,000. Including the required $15 million transfer to the U.S. Treasury, the total amount necessary to collect through registrant fees in Fiscal Year 2008 is $233,669,000. The total amount that must be collected through fee funds for the Fiscal Year 2006-2008 period to fully fund the DCP as mandated by statute is $677,420,000. Without an increase in fees, DEA would fall short by $185,475,536 in funds to support the operations of the DCP. The new fee structure contained in this final rule, therefore, provides the necessary additional funds to ensure that the operational costs of the DCP are fully funded through registrant fees as mandated by statute. As explained above, DEA is required by statute to collect the “full costs” associated with operating the DCP. XI. Calculation of Fees Based on the total amount necessary to collect for Fiscal Years 2006-2008, DEA developed the specific fee levels for each registrant category according to its current fee structure and the fee-paying ratios that have been in existence since the inception of registrant fees. New fees are shown in the table below. For discussion on DEA's analysis of alternative fee schedules and approaches to calculating registrant fees, please see DEA's 2002 Final Rule (67 FR 51988, August 9, 2002) and its 1996 Final Rule (61 FR 68624, December 30, 1996). In developing the fee schedule, DEA opted to set the fee level for a three-year period (FY 2006-2008) for two reasons. First, the vast majority of registrants are practitioners who pay a three-year registration fee. These registrants are divided into roughly three separate groups who pay their three-year registration fees on alternate year cycles. Accordingly, the fees below reflect the *total amount* necessary to be collected for the full three-year period (FY 2006-2008), divided by projected registrants and accounting for projected registrant growth by category for each fiscal year. Because different categories of registrants pay different amounts, DEA weighted the number of registrants in each category to ensure the appropriate reflection in the fee schedule. In calculating the final fee schedule reflected below, DEA relied on the latest and current registrant population figures, which have fluctuated since the proposed fees contained in the Notice of Proposed Rulemaking. Because the fees reflect the total amount necessary for collection over a three-year period (Fiscal Years 2006-2008) and because the type and number of registrants varies from year to year, the total amount of fees collected may not equal the requested budget level for any given year. Surplus fees collected in one year are used to offset fee collection shortfalls in another year. In no case are fees spent in excess of the levels enacted by Congress. In evaluating options to structure the fee schedule, DEA opted to remain with the current fee structure to reduce reporting burdens on registrants and operational costs associated with the DCP which would then be passed on to registrants through annual fees. To recover the full costs of the DCP as required by statute and as outlined in the preceding sections, DEA is adjusting the fees in accordance with its existing fee structure as shown in the following table. Under this fee schedule, controlled substances registrants and chemical registrants in the same registrant category ( *e.g.* , manufacturers) pay the same fee regardless of the substance or chemical being handled. The table also includes the current fees paid by each category. Registrant class New annual fee Current annual fee Manufacturers (controlled substances) $2,293 $1,625 Manufacturers (chemical) 2,293 595 (registration) Distributors, Importers/Exporters (controlled substances), including reverse distributors 1,147 813 Distributors, Importers/Exporters (chemical) 1,147 595 (registration) Chemical Retail Distributors 1,147 255 (registration) Dispensers/Practitioners * 184 130 Researchers, Narcotic Treatment Programs 184 130 * Practitioners, mid-level practitioners, pharmacies, hospitals/clinics, and teaching institutions will pay a fee of $551 for a three-year registration period. The fee structure above supplants the current fee structure for controlled substances and for chemical registrants. These fees go into effect November 1, 2006. XI. Related Issues and Waivers Also by this Notice, DEA is removing differentiation between retail and non-retail distributors of List I chemicals. As of the effective date of this final rule, both retail and non-retail distributors must pay the same fee as described above. DEA also is withdrawing, by this notice, its Notice of Proposed Rulemaking issued on December 1, 1999, which proposed changes in registration and reregistration fees for manufacturers, distributors, importers, exporters and retail distributors of List I chemicals (64 FR 67216, December 1, 1999). DEA also is rescinding the 1997 Notice of Fee Waiver published on October 17, 1997 (62 FR 53958) which had waived a portion of the registration fee for non-retail distributors of pseudoephedrine, phenylpropanolamine, and combination ephedrine drug products. XII. Effects on Small Businesses The new registrant fees range from $184 to $2,293 annually per location and per registered business activity. To assess whether the fees could impose a significant economic impact on a small entity, DEA considered whether the fees represent more than one percent of annual revenues for the registrant groups that qualify as small entities under the Small Business Administration

(SBA)standards. As discussed below, DEA does not anticipate that the increase in fees will have a significant impact on a substantial number of small entities. Most DEA registrants qualify as small entities under the SBA standards. Almost all practitioners, who compose 85 percent of all registrants affected by this rulemaking, would be considered small. For practitioners and dispensers, the annual revenues would have to be below $18,400 to have the annual registration fee or equivalent represent more than one percent of revenues. Medical practitioners who are granted authority to handle controlled substances have annual incomes well above that level. Eighty-six percent of all practitioners have annual incomes in excess of $133,000 (Bureau of Labor Statistics salary information). For these practitioners, the new annual fee equivalent of $184 represents less than 0.14 percent of annual income. Physician assistants, the mid-level practitioner with the lowest average salary, have annual salaries of about $65,000 ( *ibid.* ). For this practitioner group, which represents about 2 percent of registered practitioners, the annual fee equivalent equates to 0.28 percent of annual income. The higher fees also will not impose a significant burden on dispensers. The average independent pharmacy has sales of almost $2 million according to the National Association of Chain Drug Stores. The smallest clinics have revenue streams higher than $18,400. Among dispensers, the greatest impact of this regulatory fee change will be on chain pharmacies which must hold a registration for each of their locations. The largest chain holds retail pharmacy registrations for more than 5,000 locations as well as almost 40 registrations for its distribution centers. However, these businesses do not qualify as small entities; moreover, for the annual fee to have a significant economic impact, annual revenues would have to be less than $18,400. DEA acknowledges the concerns of one commenter that fee increases going into effect in the middle of a budget cycle represent a non-controllable and, perhaps, unanticipated, expense for large chain drug stores and chain pharmacy distribution centers; however, as discussed above, only a small fraction of registered chain drug stores must renew their DEA registration in the second half of Calendar Year 2006 and are thus affected by the budgetary implications of the fee increase. For manufacturers, the 2002 Census data indicate that the value of shipments for the smallest chemical manufacturers (including drugs) ranged from $477,000 to $1.1 million per location (establishment). For this registrant group, therefore, the fee of $2,293 does not represent more than one percent of revenues and will not impose a significant burden. The one registrant group for which the fees could exceed one percent of revenues and have a significant economic impact is chemical distributors. According to 2004 Duns data, between one percent and 11 percent of the wholesale sectors handling listed chemicals have revenues below $100,000. DEA does not collect financial data on its registrants, but it is possible that some chemical distributor registrants have revenues below $100,000. The increase in the annual reregistration fee for chemical distributors (from $477 to $1,147) may impose a significant burden on these registrants. The increase in the initial registration fee (from a subsidized $116 for certain entities to $1,147 annually) also could be a barrier to entrance for these very small firms. Based on its experience, however, DEA considers it unlikely that any firm that lacked the resources to pay the initial registration fee would be granted a registration because it would be unlikely to have the resources necessary to prevent diversion of the products. Moreover, the new registration fees for all wholesale level activities are far less than the estimated annual fee of $6,400 that chemical registrants would be charged if they were required to independently fund the chemical portion of the diversion control program, as previously discussed in the Notice of Proposed Rulemaking (70 FR 69474, November 16, 2005). In short, combining all diversion control activities into a single Diversion Control Program, as mandated by the Consolidated Appropriations Act of 2005, results in scale efficiencies and overall reduced costs to all registrants. XIII. Regulatory Analysis Regulatory Flexibility Act The Deputy Administrator hereby certifies that this rulemaking has been drafted in accordance with the Regulatory Flexibility Act (5 U.S.C. 605(b)) and has provided above detailed regulatory analysis on the effects of this rulemaking on small entities. The rule will not have a significant economic impact on a substantial number of small entities as discussed in Section XII. While DEA recognizes that this regulation will have a financial effect on registrants, the change in fees is necessary to fully comply with 21 U.S.C. 886a and related statutes, which mandate that DEA establish the fees at a level necessary to recover the full costs of the Diversion Control Program. Executive Order 12866 The Deputy Administrator certifies that this rulemaking has been drafted in accordance with the principles in Executive Order 12866 § 1(b). DEA has determined that, because the increased fees will result in a total increase of less than $70 million annually to be collected through fees (that is the difference between the amount collected annually under the previous fee structure and the amount to be collected under the new fee structure), this is not a significant regulatory action; however, it was reviewed by the Office of Management and Budget. The fees to be collected represent an increase of less than $70 million each year for the Fiscal Year 2006-2008 period (based on estimated fee collection figures and compared to the previous fee schedule) and are required to fully support the President's budget for the DCP, as approved by Congress through the appropriations process. Therefore, DEA has no discretion in the establishment of the new fees and is required by law to collect registration and reregistration fees of sufficient amount to fully support the DCP. Executive Order 12988 This regulation meets the applicable standards set forth in §§ 3(a) and 3(b)(2) of Executive Order 12988 Civil Justice Reform. Executive Order 13132 This rulemaking does not preempt or modify any provision of state law; nor does it impose enforcement responsibilities on any state; nor does it diminish the power of any state to enforce its own laws. Accordingly, this rulemaking does not have federalism implications warranting the application of Executive Order 13132. Unfunded Mandates Reform Act of 1995 This rule will not result in the expenditure by State, local, and tribal governments, in the aggregate of $118,000,000 or more in any one year, and will not significantly or uniquely affect small governments. The increase in fees for private sector entities and individuals will result in a total increase of less than $70 million annually to be collected through fees (that is the difference between the amount collected annually under the prior fee structure and the amount to be collected under the new fee structure). Moreover, the effect on individual entities and practitioners is minimal. The majority of the affected entities will pay a fee of $551 for a three year registration period (the equivalent of $184 per year) which equates to about 0.13 percent of annual income for most practitioners (the vast majority of all registrants). This rule is promulgated in compliance with 21 U.S.C. 886a that the full cost of operating the DCP be collected through registrant fees. Small Business Regulatory Enforcement Fairness Act of 1996 This rule is not a major rule as defined by § 804 of the Small Business Regulatory Enforcement Fairness Act of 1996. While this rule will result in an annual effect on the economy of $100,000,000 or more, in that it will result in the collection of approximately $216-$234 million annually, the increase in fees (that is, the difference between the amount collected annually under the previous fee structure compared to the new fee structure) will result in a total increase of less than $70 million annually. Moreover, it will not result in a major increase in costs or prices or cause significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of U.S.-based companies to compete with foreign-based companies in domestic and export markets. This rule is not a discretionary action but rather responds to statutory clarification as to the activities constituting the DCP which, by law, must be fully funded through registrant fees (21 U.S.C. 821 and 958 and 21 U.S.C. 886a, respectively). Moreover, the individual effect on small business registrants is minimal. The majority of registrants considered to be small businesses are practitioners who will pay a three-year registration fee of $551 or the equivalent of $184 per year. For the majority of these practitioners, who compose the vast majority of registrants and registrants qualifying as small businesses, this annual fee equivalent represents about 0.13 percent of their annual mean salary. The impact on other small business entities is described in greater detail in the preceding regulatory analysis. List of Subjects 21 CFR Part 1301 Administrative practice and procedure, Drug traffic control, Security measures. 21 CFR Part 1309 Administrative practice and procedure, Drug traffic control, Exports, Imports, Security measures. For the reasons set out above, 21 CFR parts 1301 and 1309 are amended as follows: PART 1301—REGISTRATION OF MANUFACTURERS, DISTRIBUTORS AND DISPENSERS OF CONTROLLED SUBSTANCES 1. The authority citation for part 1301 is revised to read as follows: Authority: 21 U.S.C. 821, 822, 823, 824, 871(b), 875, 877, 886a, 951, 952, 953, 956, 957. 2. Section1301.13 is amended by revising paragraph (e)(1) to read as follows: § 1301.13 Application for registration; time for application; expiration date; registration for independent activities; application forms, fees, contents and signature; coincident activities.

(e)* * *

(1)Business activity Controlled substances DEA application forms Application fee (dollars) Registration period (years) Coincident activities allowed

(i)Manufacturing Schedules I-V New—225 Renewal—225a 2,293 2,293 1 Schedules I-V: May distribute that substance or class for which registration was issued; may not distribute or dispose any substance or class for which not registered. Schedules II-V: except a person registered to dispose of any controlled substance may conduct chemical analysis and preclinical research (including quality control analysis) with substances listed in those schedules for which authorization as a mfg. was issued.

(ii)Distributing Schedules I-V New—225 Renewal—225a 1,147 1,147 1

(iii)Reverse distributing Schedules I-V New—225 Renewal—225a 1,147 1,147 1

(iv)Dispensing or instructing (includes Practitioner, Hospital/Clinic, Retail Pharmacy, Central fill pharmacy, Teaching Institution) Schedules II-V New—224 Renewal—224a 551 551 3 May conduct research and instructional activities with those substances for which registration was granted, except that a mid-level practitioner may conduct such research only to the extent expressly authorized under state statute. A pharmacist may manufacture an aqueous or oleaginous solution or solid dosage form containing a narcotic controlled substance in Schedule II-V in a proportion not exceeding 20% of the complete solution, compound or mixture. A retail pharmacy may perform central fill pharmacy activities.

(v)Research Schedule I New—225 Renewal—225a 184 184 1 A researcher may manufacture or import the basic class of substance or substances for which registration was issued, provided that such manufacture or import is set forth in the protocol required in § 1301.18 and to distribute such class to persons registered or authorized to conduct research with such class of substance or registered or authorized to conduct chemical analysis with controlled substances.

(vi)Research Schedules II-V New—225 Renewal—225a 184 184 1 May conduct chemical analysis with controlled substances in those schedules for which registration was issued; manufacture such substances if and to the extent that such manufacture is set forth in a statement filed with the application for registration or reregistration and provided that the manufacture is not for the purposes of dosage form development; import such substances for research purposes; distribute such substances to persons registered or authorized to conduct chemical analysis, instructional activities or research with such substances, and to persons exempted from registration pursuant to § 1301.24; and conduct instructional activities with controlled substances.

(vii)Narcotic Treatment Program (including compounder) Narcotic Drugs in Schedules II-V New—363 Renewal—363a 184 184 1

(viii)Importing Schedules I-V New—225 Renewal—225a 1,147 1,147 1 May distribute that substance or class for which registration was issued; may not distribute any substance or class for which not registered.

(ix)Exporting Schedules I-V New—225 Renewal—225a 1,147 1,147 1

(x)Chemical Analysis Schedules I-V New—225 Renewal—225a 184 184 1 May manufacture and import controlled substances for analytical or instructional activities; may distribute such substances to persons registered or authorized to conduct chemical analysis, instructional activities, or research with such substances and to persons exempted from registration pursuant to § 1301.24; may export such substances to persons in other countries performing chemical analysis or enforcing laws related to controlled substances or drugs in those countries; and may conduct instructional activities with controlled substances. PART 1309—REGISTRATION OF MANUFACTURERS, DISTRIBUTORS, IMPORTERS, AND EXPORTERS OF LIST I CHEMICALS 3. The authority citation for part 1309 is amended to read as follows: Authority: 21 U.S.C. 821, 822, 823, 824, 830, 871(b), 875, 877, 886a, 958. 4. Section 1309.11 is revised to read as follows: § 1309.11 Fee amounts.

(a)For each application for registration or reregistration to manufacture for distribution the applicant shall pay an annual fee of $2,293.

(b)For each application for registration or reregistration to distribute (either retail distribution or non-retail distribution), import, or export a List I chemical, the applicant shall pay an annual fee of $1,147. 5. Section 1309.12 is revised to read as follows: § 1309.12 Time and method of payment; refund.

(a)For each application for registration or reregistration to manufacture for distribution, distribute (either retail distribution or non-retail distribution), import, or export a List I chemical, the applicant shall pay the fee when the application for registration or reregistration is submitted for filing.

(b)Payment should be made in the form of a personal, certified, or cashier's check or money order made payable to “Drug Enforcement Administration.” Payments made in the form of stamps, foreign currency, or third party endorsed checks will not be accepted. These application fees are not refundable. Dated: August 22, 2006. Michele M. Leonhart, Deputy Administrator. [FR Doc. E6-14286 Filed 8-28-06; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF JUSTICE Drug Enforcement Administration [Docket No. DEA-269F] 21 CFR Part 1308 Schedules of Controlled Substances: Placement of Embutramide Into Schedule III AGENCY: Drug Enforcement Administration, Department of Justice. ACTION: Final rule. SUMMARY: With the issuance of this final rule, the Deputy Administrator of the Drug Enforcement Administration

(DEA)places the substance embutramide, including its salts, into Schedule III of the Controlled Substances Act (CSA). As a result of this rule, the regulatory controls and criminal sanctions of Schedule III will be applicable to the manufacture, distribution, dispensing, importation and exportation of embutramide and products containing embutramide. DATES: *Effective Date:* September 28, 2006. FOR FURTHER INFORMATION CONTACT: Christine A. Sannerud, Ph.D., Chief, Drug and Chemical Evaluation Section, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537,

(202)307-7183. SUPPLEMENTARY INFORMATION: Embutramide has the chemical name of N-[2-(m-methoxyphenyl)-2-ethyl-butyl]- *gamma* -hydroxybutyramide (CAS number 15687-14-6). On May 20, 2005, the Food and Drug Administration

(FDA)approved a New Animal Drug Application

(NADA)for embutramide for marketing under the trade name Tributame TM Euthanasia Solution (70 FR 36336). This product is a combination of embutramide, chloroquine phosphate, and lidocaine for prescription use by intravenous injection for euthanasia of dogs. On January 26, 2005, the Acting Assistant Secretary for Health, Department of Health and Human Services (DHHS), sent the Deputy Administrator of DEA a scientific and medical evaluation and a letter recommending that embutramide be placed into Schedule III of the CSA. Enclosed with the January 26, 2005, letter was a document prepared by the FDA entitled, “Basis for the Recommendation to Control Embutramide in Schedule III of the Controlled Substances Act (CSA).” The document contained a review of the factors which the CSA requires the Secretary to consider (21 U.S.C. 811(b)) Similar to barbiturates, embutramide has a central nervous system

(CNS)depressant effect. It produces a reversible stupor-like state (narcosis) in experimental animals. The effects of embutramide on locomotor activity, rearing, forelimb grip strength, hind-limb splay, and the performance of inverted screen tests on rodents were similar to those of pentobarbital, a classical barbiturate. Embutramide mimics discriminative stimulus effects of pentrobarbital in mice. Methohexital-trained rhesus monkeys self-administer embutramide, suggesting that embutramide produces positive reinforcing effects. The pharmacological data suggest that the abuse potential of embutramide may be similar to that of CNS depressants such as barbiturates and their products (Schedule III through IV) that are controlled under the CSA. Embutramide as one of the ingredients in the veterinary euthanasia drug product T-61, was previously marketed in the United States. T-16 was withdrawn from the market in 1991. Embutramide is not currently marketed in the United States. During the period of marketing of T-61, a limited number of case reports of suicides, attempted suicides, and accidental exposures involving this and similar embutramide containing products were published in the scientific literature. DEA searched, but has not found, any evidence of abuse or trafficking of either T-61 or embutramide. After a review of the available data, including the scientific and medical evaluation and the scheduling recommendation received from DHHS, the Deputy Administrator of the DEA, in a July 29, 2005, **Federal Register** Notice of Proposed Rulemaking (70 FR 43809), proposed placement of embutramide into Schedule III of the CSA. The proposed rule provided an opportunity for all interested persons to submit their comments, objections, or requests for hearing to be received by the DEA on or before August 29, 2005. On August 2, 2005, DEA received a request for an extension of the period in which to comment and request a hearing. The requestor indicated that the additional time was necessary to review the scientific articles and other information cited by DEA in support of its scheduling proposal. DEA granted a 30 day extension of the time to comment and request a hearing, until September 28, 2005 (70 FR 50996). Comments Received DEA received two comments in response to the notice of proposed rulemaking. One commenter supported the current proposal to control embutramide as a Schedule III drug. Another commenter supported the proposal to schedule embutramide, the substance, but not its finished pharmaceutical product, Tributame TM . This commenter stated that the abuse potential of Tributame TM is non-existent because the negative characteristics such as the presence of a cardiotoxin and the high cost of this formulation outweigh its desirable effects. DEA does not agree. Careful consideration of all the available data suggests that the amounts of cardiotoxin present in the Tributame TM formulation are insufficient to eliminate the abuse potential of this product. DEA field experience suggests that the cost of a given product is not a consistent predictor of its actual abuse. DEA also received a request for a hearing on the scheduling of embutramide and a request for an exemption of the product, Tributame TM , from scheduling; however, the requestor subsequently withdrew these requests and asked that the scheduling of embutramide be expedited. Scheduling of Embutramide Relying on the scientific and medical evaluation and the recommendation of the Acting Assistant Secretary for Health, received in accordance with Section 201(b) of the Act (21 U.S.C. 811(b)), and the independent review of the available data by DEA, and after a review of the comments received in response to the notice of proposed rulemaking, the Deputy Administrator of DEA, pursuant to Sections 201(a) and 201(b) of the Act (21 U.S.C. 811(a) and 811(b)), finds that:

(1)Based on information now available, embutramide has a potential for abuse less than the drugs or other substances in Schedules I and II;

(2)Embutramide has a currently accepted medical use in treatment in the United States; and

(3)Abuse of embutramide may lead to moderate or low physical dependence or high psychological dependence. Based on these findings, the Deputy Administrator of DEA concludes that embutramide, including its salts, warrants control in Schedule III of the CSA. The applicable regulations are as follows: *Registration.* Any person who manufactures, distributes, dispenses, imports, exports, engages in research or conducts instructional activities with embutramide, or who desires to manufacture, distribute, dispense, import, export, engage in instructional activities or conduct research with embutramide, must be registered to conduct such activities in accordance with Part 1301 of Title 21 of the Code of Federal Regulations. Any person who is currently engaged in any of the above activities and is not registered with DEA must submit an application for registration on or before September 28, 2006 and may continue their activities until DEA has approved or denied that application. *Security.* Embutramide is subject to Schedule III-V security requirements and must be manufactured, distributed and stored in accordance with Sections 1301.71, 1301.72(b), (c), and (d), 1301.73, 1301.74, 1301.75(b) and (c), 1301.76, and 1301.77 of Title 21 of the Code of Federal Regulations on and after September 28, 2006. *Labeling and Packaging.* All labels and labeling for commercial containers of embutramide shall comply with requirements of Sections 1302.03-1302.07 of Title 21 of the Code of Federal Regulations and on and after September 28, 2006. *Inventory.* Every registrant required to keep records and who possesses any quantity of embutramide must keep an inventory of all stocks of embutramide on hand pursuant to Sections 1304.03, 1304.04 and 1304.11 of Title 21 of the Code of Federal Regulations on and after September 28, 2006. Every registrant who desires registration in Schedule III for embutramide is required to conduct an inventory of all stocks of the substance on hand at the time of registration. *Records.* All registrants must keep records pursuant to Sections 1304.03, 1304.04, 1304.21, 1304.22, and 1304.23 of Title 21 of the Code of Federal Regulations on and after September 28, 2006. *Prescriptions.* All prescriptions for embutramide or prescriptions for products containing embutramide are to be issued pursuant to 21 CFR 1306.03-1306.06 and 1306.21-1306.27. All prescriptions for embutramide or products containing embutramide issued on and after September 28, 2006, if authorized for refiling, shall, as of that date, be limited to five refills and shall not be refilled after six months of the date is issuance. *Importation and Exportation.* All importation and exportation of embutramide must be in compliance with part 1312 of Title 21 of the Code of Federal Regulations on and after September 28, 2006. *Criminal Liability.* Any activity with embutramide not authorized by, or in violation of, the Controlled Substances Act or the Controlled Substances Import and Export Act shall be unlawful on and after September 28, 2006. Regulatory Certifications Executive Order 12866 In accordance with the provisions of the CSA (21 U.S.C. 811(a)), this action is a formal rulemaking “on the record after opportunity for a hearing.” Such proceedings are conducted pursuant to the provisions of 5 U.S.C. 56 and 557 and, as such, are exempt from review by the Office of Management and Budget pursuant to Executive Order 12866, section 3(d)(1). Regulatory Flexibility Act The Deputy Administrator, in accordance with the Regulatory Flexibility Act (5 U.S.C. 605(b)), has reviewed this final rule and by approving it certifies that it will not have a significant economic impact on a substantial number of small entities. Embutramide products will be prescription drugs used for the euthanasia of animals. Handlers of embutramide also handle other controlled substances used to euthanize animals which are already subject to the regulatory requirements of the CSA. Embutramide is a new drug in the United States; recent approval of the product and its labeling by the FDA will allow it to be marketed once it is placed into Schedule III of the CSA. This finalrule will allow these entities to have access to a new pharmaceutical product. Executive Order 12988 This regulation meets the applicable standards set forth in Sections 3(a) and 3(b)(2) of Executive Order 12988 Civil Justice Reform. Executive Order 13132 This rulemaking does not preempt or modify any provision of state law; nor does it impose enforcement responsibilities on any state; nor does it diminish the power of any state to enforce its own laws. Accordingly, this rulemaking does not have federalism implications warranting the application of Executive Order 13132. Unfunded Mandates Reform Act of 1995 This rule will not result in the expenditure by State, local and tribal governments, in the aggregate, or by the private sector, of $118,000,000 or more in any one year, and will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under provisions of the Unfunded Mandates Reform Act of 1995. Small Business Regulatory Enforcement Fairness Act of 1996 This rule is not a major rule as defined by section 804 of the Small Business Regulatory Enforcement Fairness Act of 1996. This rule will not result in an annual effect on the economy of $100,000,000 or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign-based companies in domestic and export markets. List of Subjects in 21 CFR Part 1308 Administrative practice and procedure, Drug traffic control, Narcotics, Prescription drugs. Under the authority vested in the Attorney General by section 201(a) of the Controlled Substances Act (21 U.S.C. 811(a)), and delegated to the Administrator of DEA by Department of Justice regulations (28 CFR 0.100), and redelegated to the Deputy Administrator pursuant to 28 CFR 0.104, the Deputy Administrator hereby amends 21 CFR part 1308 as follows: PART 1308—SCHEDULES OF CONTROLLED SUBSTANCES 1. The authority citation for 21 CFR part 1308 continues to read as follows: Authority: 21 U.S.C. 811, 812, 871(b), unless otherwise noted. 2. Section 1308.13 is amended by redesignating paragraphs (c)(5) through (c)(13) as paragraphs (c)(6) through (c)(14), and adding a new paragraph (c)(5) to read as follows: § 1308.13 Schedule III.

(c)* * *

(5)Embutramide . . . . 2020 Dated: August 22, 2006. Michele M. Leonhart, Deputy Administrator. [FR Doc. E6-14287 Filed 8-28-06; 8:45 am] BILLING CODE 4410-09-P DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 100 [CGD05-06-042] RIN 1625-AA08 Special Local Regulations for Marine Events; Susquehanna River, Port Deposit, MD AGENCY: Coast Guard, DHS. ACTION: Notice of enforcement of regulation. SUMMARY: The Coast Guard will enforce the special local regulations for the “Ragin' on the River” powerboat race to be held Labor Day weekend, September 2 and 3, 2006, on the waters of the Susquehanna River, adjacent to Port Deposit, Maryland. This action is necessary to provide for the safety of life on navigable waters during the event. The effect will be to restrict general navigation in the regulated area for the safety of participants and vessels transiting the event area. DATES: *Effective Dates:* 33 CFR 100.535 will be enforced from 10:30 a.m. to 6:30 p.m. on September 2 and 3, 2006. If the event is postponed due to weather, this section will be enforced during the same time period on Monday, September 4, 2006. FOR FURTHER INFORMATION CONTACT: Ronald Houck, Coast Guard Sector Baltimore, Prevention Department, at

(410)576-2674. SUPPLEMENTARY INFORMATION: Annually, during Labor Day weekend, the Port Deposit, Maryland Chamber of Commerce sponsors the “Ragin' on the River” powerboat race, on the waters of the Susquehanna River. The event consists of approximately 60 inboard hydroplanes and runabouts racing in heats counterclockwise around an oval racecourse. A fleet of 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. In order to ensure the safety of the event participants and transiting vessels, 33 CFR 100.535 will be enforced for the duration of the event. Under provisions of 33 CFR 100.535, a vessel may not enter the regulated area unless it receives permission from the Coast Guard Patrol Commander. In addition to this notice, the maritime community will be provided extensive advance notification via the Local Notice to Mariners, marine information broadcasts, local radio stations and area newspapers, so mariners can adjust their plans accordingly. Dated: August 14, 2006. L.L. Hereth, Rear Admiral, U.S. Coast Guard, Commander, Fifth Coast Guard District. [FR Doc. E6-14268 Filed 8-28-06; 8:45 am] BILLING CODE 4910-15-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R07-OAR-2006-0484; FRL-8213-9] Approval and Promulgation of Implementation Plans; State of Iowa AGENCY: Environmental Protection Agency (EPA). ACTION: Direct final rule. SUMMARY: EPA is approving a State Implementation Plan

(SIP)revision submitted by the state of Iowa for the purpose of establishing exemptions for indoor sources of air pollution that are not directly vented to the outside but have emissions that leave the building through doors, vents or other means. This revision also clarifies that the permitting exemptions do not relieve the owner or operator of any source from any obligation to comply with any other applicable requirements. The state has demonstrated that air pollution emissions from this equipment are negligible and these exemptions are likely to result in no significant impact on human health or the environment. We have reviewed the state's justification for the revisions and agree with its conclusions. DATES: This direct final rule will be effective October 30, 2006, without further notice, unless EPA receives adverse comment by September 28, 2006. If adverse comment is received, EPA will publish a timely withdrawal of the direct final rule in the **Federal Register** informing the public that the rule will not take effect. ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R07-OAR-2006-0484, by one of the following methods: 1. *http://www.regulations.gov.* Follow the on-line instructions for submitting comments. 2. E-mail: *Hamilton.heather@epa.gov.* 3. Mail: Heather Hamilton, Environmental Protection Agency, Air Planning and Development Branch, 901 North 5th Street, Kansas City, Kansas 66101. 4. Hand Delivery or Courier: Deliver your comments to Heather Hamilton, Environmental Protection Agency, Air Planning and Development Branch, 901 North 5th Street, Kansas City, Kansas 66101. *Instructions:* Direct your comments to Docket ID No. EPA-R07-OAR-2006-0484. 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.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 through *http://www.regulations.gov* or e-mail information that you consider to be CBI or otherwise protected. 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 at the Environmental Protection Agency, Air Planning and Development Branch, 901 North 5th Street, Kansas City, Kansas 66101. The Regional Office's official hours of business are Monday through Friday, 8 to 4:30 excluding Federal holidays. The interested persons wanting to examine these documents should make an appointment with the office at least 24 hours in advance. FOR FURTHER INFORMATION CONTACT: Heather Hamilton at

(913)551-7039, or by e-mail at *Hamilton.heather@epa.gov* . SUPPLEMENTARY INFORMATION: Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. This section provides additional information by addressing the following questions: What is a SIP? What is the Federal approval process for a SIP? What does Federal approval of a state regulation mean to me? What is being addressed in this document? Have the requirements for approval of a SIP revision been met? What action is EPA taking? What is a SIP? Section 110 of the Clean Air Act

(CAA)requires states to develop air pollution regulations and control strategies to ensure that state air quality meets the national ambient air quality standards established by EPA. These ambient standards are established under section 109 of the CAA, and they currently address six criteria pollutants. These pollutants are: Carbon monoxide, nitrogen dioxide, ozone, lead, particulate matter, and sulfur dioxide. Each state must submit these regulations and control strategies to us for approval and incorporation into the Federally-enforceable SIP. Each Federally-approved SIP protects air quality primarily by addressing air pollution at its point of origin. These SIPs can be extensive, containing state regulations or other enforceable documents and supporting information such as emission inventories, monitoring networks, and modeling demonstrations. What is the Federal approval process for a SIP? In order for state regulations to be incorporated into the Federally-enforceable SIP, states must formally adopt the regulations and control strategies consistent with state and Federal requirements. This process generally includes a public notice, public hearing, public comment period, and a formal adoption by a state-authorized rulemaking body. Once a state rule, regulation, or control strategy is adopted, the state submits it to us for inclusion into the SIP. We must provide public notice and seek additional public comment regarding the proposed Federal action on the state submission. If adverse comments are received, they must be addressed prior to any final Federal action by us. All state regulations and supporting information approved by EPA under section 110 of the CAA are incorporated into the Federally-approved SIP. Records of such SIP actions are maintained in the Code of Federal Regulations

(CFR)at title 40, part 52, entitled “Approval and Promulgation of Implementation Plans.” The actual state regulations which are approved are not reproduced in their entirety in the CFR outright but are “incorporated by reference,” which means that we have approved a given state regulation with a specific effective date. What does Federal approval of a State regulation mean to me? Enforcement of the state regulation before and after it is incorporated into the Federally-approved SIP is primarily a state responsibility. However, after the regulation is Federally approved, we are authorized to take enforcement action against violators. Citizens are also offered legal recourse to address violations as described in section 304 of the CAA. What is being addressed in this document? EPA is approving a revision to the SIP for the State of Iowa which establishes exemptions from construction permitting for certain categories of air pollution sources. This revision became state effective on April 19, 2006. The exemptions include equipment, processes and activities identified in the rule and summarized below. The reader should refer to the Iowa Administrative Code, Chapter 22.1 and the technical support document, which are part of the docket for this rulemaking for more detail concerning the exemptions. 1. An amendment to paragraph 22.1(2) “m”, which exempts certain storage tanks, raises the maximum capacity and throughput of tanks which may qualify for the exemption. 2. An amendment to paragraph 22.1(2) “x” adds an exemption for certain applications of hot melt adhesives from specified closed-pot systems. 3. An amendment to subrule 22.1(2) adds several new exemptions as follows: a. Product labeling using laser and ink-jet printers meeting specified performance criteria; b. Equipment related to research and development activities at a stationary source meeting specified emissions and recordkeeping criteria, and meeting the definition of “research and development activities” specified in the rule; c. Regional collection centers, as defined in Iowa's hazardous waste rules, involved in the processing of permitted hazardous materials from households and certain small quantity generators meeting specified quantity restrictions for materials containing volatile organic compounds (VOCs); d. Cold solvent cleaning machines that are not in-line cleaning machines, which meet specified performance and operational criteria. We note that the Iowa exemption rule provides that none of the exemptions are available to emissions units, processes, or activities that would trigger the requirements for major new source review (e.g., the prevention of significant deterioration program). The Iowa Department of Natural Resources

(IDNR)has provided a justification document which analyzes the projected emissions increases and air quality impact which may be attributable to the exemptions. For example, Iowa determined that the product labeling exemption would apply to equipment which emits no more than 3.75 tons per year of VOCs, which is the threshold included in the Iowa permit rules previously approved by EPA as de minimis for permitting of minor sources. Similar justifications for the other exemptions are included in the docket for this rulemaking. Based on review of IDNR's technical evaluation documented in the exemption justification document submitted with the rule and included in the docket, EPA agrees that the emission units and activities exempted by the rule generate emissions that have little or no environmental or human health consequences and can be exempted from the requirement to obtain a construction permit. Have the requirements for approval of a SIP revision been met? The state submittal has met the public notice requirements for SIP submissions in accordance with 40 CFR 51.102. The submittal also satisfied the completeness criteria of 40 CFR part 51, appendix V. In addition, as explained above and in more detail in the technical support document that is part of this rulemaking, the revision meets the substantive SIP requirements of the CAA, including section 110 and implementing regulations. What action is EPA taking? EPA is approving a revision which adds permitting exemptions to the Iowa Administrative Code. This revision also clarifies that the permitting exemptions do not relieve the owner or operator of any source from any obligation to comply with any other applicable requirements. We are processing this action as a direct final action because the revisions make minor changes to the existing rules that are noncontroversial. Therefore, we do not anticipate any adverse comments. Please note that if EPA receives adverse comment on part of this rule and if that part can be severed from the remainder of the rule, EPA may adopt as final those parts of the rule that are not the subject of an adverse comment. Statutory and Executive Order Reviews Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 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 approves state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this 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 approves 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 rule also does not have tribal implications because it will 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). This action also does not have Federalism implications because it does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This action merely approves a state rule implementing a Federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the CAA. This rule also is not subject to Executive Order 13045, “Protection of Children from Environmental Health Risks and Safety Risks” (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 CAA. 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 CAA. 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. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ). The Congressional Review Act, 5 U.S.C. 801 *et seq.* , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the **Federal Register** . A major rule cannot take effect until 60 days after it is published in the **Federal Register** . This action is not a “major rule” as defined by 5 U.S.C. 804(2). Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 30, 2006. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).) List of Subjects in 40 CFR Part 52 Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds. Dated: August 15, 2006. William W. Rice, Acting Regional Administrator, Region 7. Chapter I, title 40 of the Code of Federal Regulations is amended as follows: PART 52—[AMENDED] 1. The authority citation for part 52 continues to read as follows: Authority: 42 U.S.C. 7401 *et seq.* Subpart Q—Iowa 2. In § 52.820 the table in paragraph

(c)is amended by revising the entry for 567-22.1 to read as follows: § 52.820 Identification of plan.

(c)* * * EPA-Approved Iowa Regulations Iowa citation Title State effective date EPA approval date Explanation Iowa Department of Natural Resources Environmental Protection Commission [567] * * * * * * * Chapter 22—Controlling Pollution 567-22.1 Permits Required for New or Existing Stationary Sources 04/19/06 08/29/06 [ *insert FR page number where the document begins* ] * * * * * * * [FR Doc. E6-14313 Filed 8-28-06; 8:45 am] BILLING CODE 6560-50-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R09-OAR-2006-0225; FRL-8207-9] Revisions to the California State Implementation Plan, South Coast Air Quality Management District AGENCY: Environmental Protection Agency (EPA). ACTION: Final rule. SUMMARY: EPA is finalizing approval of revisions to the South Coast Air Quality Management District's (SCAQMD) portion of the California State Implementation Plan (SIP). These revisions were proposed in the **Federal Register** on May 16, 2006 and concern oxides of nitrogen (NO X ) and oxides of sulfur (SO X ) emissions from facilities emitting 4 tons or more per year of NO X or SO X in the year 1990 or subsequent year under the SCAQMD's Regional Clean Air Incentives Market (RECLAIM) program. We are approving local rules that regulate these emission sources under the Clean Air Act as amended in 1990 (CAA or the Act). DATES: *Effective Date:* This rule is effective on September 28, 2006. ADDRESSES: EPA has established docket number EPA-R09-OAR-2006-0225 for this action. The index to the docket is available electronically at *http://www.regulations.gov* and in hard copy at EPA Region IX, 75 Hawthorne Street, San Francisco, California. While all documents in the docket are listed in the index, some information may be publicly available only at the hard copy location (e.g., copyrighted material), and some may not be publicly available in either location (e.g., CBI). To inspect the hard copy materials, please schedule an appointment during normal business hours with the contact listed in the FOR FURTHER INFORMATION CONTACT section. FOR FURTHER INFORMATION CONTACT: Lily Wong, EPA Region IX,

(415)947-4114, *wong.lily@epa.gov.* SUPPLEMENTARY INFORMATION: Throughout this document, “we,” “us” and “our” refer to EPA. I. Proposed Action On May 16, 2006 (71 FR 28290), EPA proposed to approve the following rules into the California SIP. Table 1 lists the rules addressed by this action with the dates that they were adopted by the SCAQMD and submitted by the California Air Resources Board (CARB). Table 1.—Submitted Rules Local agency Rule No. Rule title Adopted Submitted SCAQMD 2000 General 05/06/05 10/20/05 SCAQMD 2001 Applicability 05/06/05 10/20/05 SCAQMD 2002 Allocations for Oxides of Nitrogen (NO X ) and Oxides of Sulfur (SO X ) 01/07/05 12/21/05 SCAQMD 2005 New Source Review for Trading Requirements 05/06/05 10/20/05 SCAQMD 2007 Trading Requirements 05/06/05 10/20/05 SCAQMD 2010 Administrative Remedies and Sanctions 01/07/05 07/15/05 SCAQMD 2011 Requirements for Monitoring, Reporting, and Recordkeeping for Oxides of Sulfur (SO X ) Emissions 01/07/05 07/15/05 SCAQMD 1 2011 Appendix A: Protocol for Monitoring, Reporting, and Recordkeeping for Oxides of Sulfur (SO X ) Emissions, Chapter 1 05/06/05 10/20/05 SCAQMD 1 2011 Appendix A: Protocol for Monitoring, Reporting, and Recordkeeping for Oxides of Sulfur (SO X ) Emissions, Chapters 2-6 and Attachments A-F 01/07/05 07/15/05 SCAQMD 2012 Requirements for Monitoring, Reporting, and Recordkeeping for Oxides of Nitrogen (NO X ) Emissions 01/07/05 07/15/05 SCAQMD 1 2012 Appendix A—Protocol for Monitoring, Reporting, and Recordkeeping for Oxides of Nitrogen (NO X ) Emissions, Chapter 1 05/06/05 10/20/05 SCAQMD 2012 Appendix A (Protocol for Monitoring, Reporting, and Recordkeeping for Oxides of Nitrogen (NO X ) Emissions, Chapters 2-8 and Attachments A-G 01/07/05 07/15/05 1 Protocol Appedix A. In EPA's proposed approval, we did not clarify that only Chapter 1 of Rule 2011 Protocol Appendix A and Chapter 1 of Rule 2012 Protocol Appendix A were adopted on May 6, 2005 and submitted on October 20, 2005. The remaining portions of those rules were adopted on January 7, 2005 and submitted on July 15, 2005. We proposed to approve these rules because we determined that they complied with the relevant CAA requirements. Our proposed action contains more information on the rules and our evaluation. II. Public Comments and EPA Responses EPA's proposed action provided a 30-day public comment period. During this period, we received no comments. III. EPA Action No comments were submitted that change our assessment that the submitted rules comply with the relevant CAA requirements. Therefore, as authorized in section 110(k)(3) of the Act, EPA is fully approving these rules into the California SIP. IV. Statutory and Executive Order Reviews Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 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 approves state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this 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 approves 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 rule also does not have tribal implications because it will 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). This action also does not have federalism implications because it does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This action merely approves a state rule implementing a Federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (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. 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. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ). The Congressional Review Act, 5 U.S.C. 801 *et seq.* , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the **Federal Register** . A major rule cannot take effect until 60 days after it is published in the **Federal Register** . This action is not a “major rule” as defined by 5 U.S.C. 804(2). Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 30, 2006. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).) List of Subjects in 40 CFR Part 52 Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Nitrogen dioxide, Ozone, Reporting and recordkeeping requirements. Dated: July 26, 2006. Wayne Nastri, Regional Administrator, Region IX. Part 52, Chapter I, Title 40 of the Code of Federal Regulations is amended as follows: PART 52—[AMENDED] 1. The authority citation for part 52 continues to read as follows: Authority: 42 U.S.C. 7401 *et seq.* Subpart F—California 2. Section 52.220 is amended by adding paragraphs (c)(337)(i)(C), (342)(i)(C)(2), and

(343)to read as follows: 52.220 Identification of plan.

(c)* * *

(337)* * *

(i)* * *

(C)South Coast Air Quality Management District. ( *1* ) Rules 2010, 2011, 2011 Protocol Appendix A Chapters 2-6 and Attachments A-F, 2012, and 2012 Protocol Appendix A Chapters 2-8 and Attachments A-G adopted on January 7, 2005.

(342)* * *

(i)* * *

(C)* * * ( *2* ) Rules 2000, 2001, 2005, 2007, 2011 Protocol Appendix A Chapter 1, and 2012 Protocol Appendix A Chapter 1 adopted on May 6, 2005.

(343)An amended regulation for the following AQMD was submitted on December 21, 2005, by the Governor's designee.

(i)Incorporation by reference.

(A)South Coast Air Quality Management District. ( *1* ) Rule 2002 adopted on January 7, 2005. [FR Doc. E6-14317 Filed 8-28-06; 8:45 am] BILLING CODE 6560-50-P DEPARTMENT OF TRANSPORTATION Pipeline and Hazardous Materials Safety Administration 49 CFR Parts 173 and 180 [Docket No. PHMSA-03-14405 (HM-220F)] RIN 2137-AD78 Hazardous Materials: Aluminum Cylinders Manufactured of Aluminum Alloy 6351-T6 Used in SCUBA, SCBA, and Oxygen Services—Revised Requalification and Use Criteria AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA), DOT. ACTION: Final rule. SUMMARY: This final rule revises the Hazardous Materials Regulations to address a known safety problem with cylinders manufactured of aluminum alloy 6351-T6. The revisions include an inspection and testing program for early detection of sustained load cracking on cylinders manufactured of aluminum alloy 6351-T6 and used in self-contained underwater breathing apparatus (SCUBA), self-contained breathing apparatus (SCBA), and oxygen services. DATES: *Effective date:* January 1, 2007. FOR FURTHER INFORMATION CONTACT: Mark Toughiry, Office of Hazardous Materials Technology,

(202)366-4545, or Kurt C. Eichenlaub, Office of Hazardous Materials Standards,

(202)366-8553; PHMSA, U.S. Department of Transportation, 400 Seventh Street, SW., Washington, DC 20590-0001. SUPPLEMENTARY INFORMATION: Contents I. Background II. Analysis of Comments to SNPRM III. Section-by-Section Review IV. Regulatory Analyses and Notices A. Statutory/Legal Authority for This Rulemaking B. Executive Order 12866 and DOT Regulatory Polices and Procedures C. Executive Order 13132 D. Executive Order 13175 E. Regulatory Flexibility Act, Executive Order 13272, and DOT Procedures and Policies F. Paperwork Reduction Act G. Regulation Identifier Number

(RIN)H. Unfunded Mandates Reform Act I. Environmental Assessment J. Privacy Act I. Background Cylinders made of aluminum alloy 6351-T6 are known to be susceptible to sustained load cracking

(SLC)in the neck and shoulder area of the cylinder. While the exact cause and mechanism of SLC are not yet fully understood, it appears the cracks primarily originate from the bottom of the neck of the cylinder, at or below the lowest thread position in the interior of the cylinder. The cracking was first brought to PHMSA's attention by persons retesting cylinders under the periodic retest procedures of § 180.209 of the Hazardous Materials Regulations (HMR; 49 CFR parts 171-180). The majority of SLC-related ruptures have occurred in self-contained underwater breathing apparatus (SCUBA), self-contained breathing apparatus (SCBA), and oxygen services. Since 1994, the Pipeline and Hazardous Materials Safety Administration (PHMSA, we) has been notified of thirteen suspected SLC ruptures of cylinders manufactured of aluminum alloy 6351-T6. Five of the thirteen ruptures resulted in serious injuries. Data from manufacturers show there are thousands of cylinders with small, non-leaking cracks, which are regularly detected during a diligent, detailed requalification process. Manufacturers of cylinders made from the 6351-T6 aluminum alloy have conducted research, testing, and analysis to determine whether there is any correlation between SLC and the probability of a cylinder rupture. The data indicate the cylinders may leak but not rupture when operated at marked service pressure. The data also indicate the probability of cracking increases with an increase in stress levels. We performed additional metallurgical analysis on several ruptured cylinders to verify the cause of failure and failure mode. (See the metallurgical analysis reports at *http://hazmat.dot.gov/pubs/reports/cylinder/3al_cyls_info.htm* ). Those metallurgical analyses revealed SLC caused the cylinder ruptures, but the results were inconclusive as to why the cylinders abruptly ruptured instead of developing leaks. North American manufacturers discontinued using aluminum alloy 6351-T6 prior to 1990, replacing it with aluminum alloy 6061-T6, which is not susceptible to SLC. Cylinders manufactured of aluminum alloy 6351-T6 prior to 1990 include seamless aluminum cylinders marked “DOT 3AL;” and those marked with one of the following exemption or special permit numbers: 6498, 7042, 8107, 8364, and 8422. We estimate approximately 3.7 million U.S. cylinders manufactured from aluminum alloy 6351-T6 are currently in use in SCUBA, SCBA, and oxygen services. On August 8, 2002, we published a final rule (67 FR 51626) amending the requirements of the HMR applicable to the maintenance, requalification, repair, and use of DOT specification cylinders. On May 8, 2003, we issued a subsequent final rule (68 FR 24653) making further revisions in response to appeals. In these final rules, we added the following amendments pertaining to DOT specification cylinders made with aluminum alloy 6351-T6: • Removed the authorization for the manufacture of DOT specification cylinders made with aluminum alloy 6351-T6 because cylinders manufactured with this aluminum alloy have a greater risk of failure than other aluminum cylinders. • Prohibited the use of cylinders made with aluminum alloy 6351-T6 for the transportation of materials poisonous by inhalation in Hazard Zone A effective on October 1, 2002. After that date, cylinders made of aluminum alloy 6351-T6 may not be filled and offered for transportation in toxic inhalation hazard service. • Prohibited the use of cylinders manufactured of aluminum alloy 6351-T6 for gases having pyrophoric properties. • Required a visual inspection of DOT specification or exemption cylinders made of aluminum alloy 6351-T6 for evidence of SLC in the neck and shoulder area. On September 10, 2003, the Research and Special Programs Administration, the predecessor agency to PHMSA, published an NPRM (68 FR 53314) proposing to amend HMR requirements applicable to aluminum cylinders manufactured using aluminum alloy 6351-T6. In the NPRM, for cylinders manufactured of aluminum alloy 6351-T6 used in SCUBA, SCBA, and oxygen service, we proposed the following amendments: • A combined visual and eddy current examination at the time of requalification. • A new Appendix C to Part 180, to specify the procedure to conduct the eddy current examination. • Suitable safeguards to protect personnel and facilities should a cylinder fail during the filling process. Although we believe the thirteen reported SLC ruptures under represent the extent of the SLC issue, we did not have sufficient data to determine whether the SLC-related ruptures extend beyond those services discussed above. Therefore, in the NPRM we requested additional information from manufacturers and users who were aware of a cylinder rupture, whether domestic or foreign, involving a DOT 3AL cylinder or any other cylinder manufactured from aluminum alloy 6351-T6. More broadly, we invited commenters to address the issue of whether the new inspection requirements proposed in the NPRM should apply to cylinders manufactured of aluminum alloy 6351-T6 and used in services other than SCUBA, SCBA, or oxygen. On October 26, 2005, based on comments received in response to the NPRM, we published an SNPRM (70 FR 61762) to revise the amendments originally proposed in the NPRM, expand the scope of the rulemaking, and propose additional requirements for DOT 3AL cylinders manufactured of aluminum alloy 6351-T6. In the SNPRM, we proposed to: • Require a combined visual and eddy current examination at the time of requalification of DOT 3AL cylinders manufactured of aluminum alloy 6351-T6 and used in carbon dioxide service, in addition to those used in SCUBA, SCBA, and oxygen services. • Impose a 40-year service life for cylinders manufactured of aluminum alloy 6351-T6 and used in SCUBA, SCBA, oxygen and carbon dioxide services. • Add additional training requirements for persons performing the eddy current examination combined with a visual inspection. • Modify procedures and recordkeeping requirements for eddy current examinations. • Add a requirement to perform the initial eddy current examination combined with visual inspection for DOT 3AL cylinders manufactured of aluminum alloy 6351-T6 within three years of publication of a final rule in the **Federal Register** . II. Analysis of Comments We received 10 comments from individuals and organizations, including cylinder manufacturers, representatives of the SCUBA and compressed gas industries, and eddy current test equipment manufacturers. The following companies, organizations, and individuals submitted comments: George Perez (Perez; RSPA-2003-14405-17); Matheson Tri Gas (Matheson; RSPA-2003-14405-18); Air Liquide Canada, Inc. (Air Liquide; RSPA-2003-14405-19); Engineered Inspection Systems (Engineered Inspection; RSPA-2003-14405-20); Western Sales & Testing of Deer Park, Inc. (Western Sales; RSPA-2003-14405-21, RSPA-2003-14405-22, RSPA-2003-14405-23, RSPA-2003-14405-24); Barlen and Associates, Inc. (Barlen; RSPA-2003-14405-25); Luxfer Gas Cylinders (Luxfer; RSPA-2003-14405-26); Brian H. Schumann (Schumann; RSPA-2003-14405-27); Compressed Gas Association (CGA; RSPA-2003-14405-28); and, Amy Morgan Bruecks (Bruecks; RSPA-2003-14405-29). These comments are available in their entirety at the U.S. DOT Docket Management System Web site: *http://dms.dot.gov* , under Docket No. PHMSA-03-14405. In this final rule, we summarize comments submitted to the docket, address concerns raised by commenters, and discuss our decisions on specific issues. A. Carbon Dioxide Service The SNPRM proposed enhanced requalification requirements and a 40-year service life for DOT 3AL cylinders manufactured of aluminum alloy 6351-T6 and used in SCUBA, SCBA, oxygen, and carbon dioxide services. DOT 3AL cylinders used for carbon dioxide service were not included in the original NPRM, but were added to the SNPRM as a result of our own initiative and in response to comments submitted to the NPRM. Comments to the SNPRM are divided on the proposed scope of the rule. Several commenters [Bruecks; Engineered Inspection; Western Sales] recommend expanding the scope of the final rule to include “all cylinders manufactured of aluminum alloy 6351-T6” while others [CGA; Barlen] are opposed to expanding the scope beyond cylinders used in SCUBA, SCBA, and oxygen services. Three commenters [Bruecks; Engineered Inspection; Western Sales] assert cylinders manufactured with aluminum alloy 6351-T6 are dangerous regardless of end use. One commenter [Western Sales] states, “[T]o simplify, and because I believe that this cylinder is just as dangerous when being used in services not addressed, I believe that any reference to just the 4 specific services be dropped. While I appreciate that there are no catastrophic failures from other user groups, that have been reported, I believe including all cylinders made of 6351-T6 is in the best interest of the cylinder industry and the general public.” Each of the three commenters recommends amending proposed requirements to include “all” cylinders manufactured of aluminum alloy 6351-T6 in the scope of this rule. We disagree. As previously stated, the majority of cylinder ruptures due to SLC have occurred in SCUBA, SCBA, and oxygen services. We believe these ruptures are directly related to the increased frequencies with which these cylinders are filled and their higher operating pressures. As discussed in the NPRM (68 FR 53314), the probability of SLC increases the more frequently the cylinder is filled. Additionally, cylinders used in SCUBA and SCBA services may be used by a diver or firefighter, substantially increasing the risk of injury or fatality in the event of a cylinder rupture. To date, there have been no reported ruptures involving DOT 3AL cylinders manufactured of aluminum alloy 6351-T6 and used in carbon dioxide, fire extinguisher, or other industrial gas service. Therefore, we are not expanding the scope of the rule to include all DOT 3AL cylinders manufactured of aluminum alloy 6351-T6. Two commenters [CGA; Barlen] to the SNPRM oppose expanding the scope of the rule to include cylinders used in carbon dioxide service. One commenter [CGA] states, “SLC is most likely to occur at high pressures. Because cylinders used in [carbon dioxide] service are operated at a lower pressure than those used in SCBA and SCUBA service, the rate of cracking for cylinders in [carbon dioxide] service will be substantially less than for those used in SCBA and SCUBA service. Failure by SLC is not expected to occur in cylinders used in [carbon dioxide] service.” A comment submitted by City Carbonic Sales Service [City Carbonic; RSPA-2003-14405-13] to the 2003 NPRM (68 FR 53314) asserts a significant number of cylinders used in carbon dioxide service were condemned due to SLC during a three-year in-house survey. However, a commenter [CGA] to the SNPRM disagrees with that assertion, suggesting it was unsubstantiated. The commenter [CGA] states the specific type of cracks observed in the condemned cylinders were not confirmed to be related to SLC, but were most likely due to the over-torquing of these cylinder's taper threaded valves causing cracks to occur in the neck of the cylinder. Two commenters [CGA; Barlen] suggest we are proposing to expand the scope of the rule without providing appropriate technical data to justify such an amendment. These commenters also assert SLC is not likely to develop in DOT 3AL cylinders used in carbon dioxide service and recommend we remove the proposed amendment to include these cylinders in the scope of this rule. We agree. Therefore, in this final rule, we are removing the proposal expanding the scope of the rulemaking to include cylinders manufactured of aluminum alloy 6351-T6 and used in carbon dioxide service. We agree with the commenter's [CGA] statement that cylinders used in carbon dioxide service generally operate at lower pressures and, thus, have a reduced likelihood of developing SLC. Commenters are correct there have been no reported cylinder ruptures involving DOT 3AL cylinders manufactured of aluminum alloy 6351-T6 and used in carbon dioxide, fire extinguisher, or other industrial gas services. However, we will continue to monitor these cylinders for evidence of SLC and, if the situation warrants, we may revisit this issue in a future rulemaking. B. 40-Year Service Life Currently, cylinders manufactured of aluminum alloy 6351-T6 may be used indefinitely so long as they conform to the requalification test and inspection criteria established in the HMR. The SNPRM proposed a 40-year service life from the date of manufacture for DOT 3AL cylinders manufactured of aluminum alloy 6351-T6 and used in SCUBA, SCBA, oxygen, and carbon dioxide services. Several commenters [CGA; Air Liquide; Barlen] to the SNPRM oppose the 40-year service life proposed for DOT 3AL cylinders manufactured of aluminum alloy 6351-T6. These commenters suggest there is no evidence these cylinders are more likely to be susceptible to SLC as they age and state the proposed amendment lacks the appropriate test data, analysis, or statistical data to support the implication that older cylinders are more likely to develop SLC. These commenters further suggest requalification is the most appropriate method to identify and condemn DOT specification cylinders regardless of their age. After consideration of these comments, we agree our proposed 40-year service life for cylinders manufactured of aluminum alloy 6451-T6 and used in SCUBA, SCBA, carbon dioxide, and oxygen services is not warranted at this time. We also agree with the commenters' [CGA; Air Liquide; Barlen] statements that the requalification process is an effective method of condemning deteriorated or damaged DOT specification cylinders. Further, there is evidence these cylinders are being voluntarily removed from service as defects are identified through inspections and testing. Therefore, we are not adopting the 40-year service life in this final rule. We will continue to monitor cylinders manufactured of aluminum alloy 6351-T6 for evidence of SLC. If the situation warrants, we may revisit this issue in a future rulemaking. C. Requalification Schedule for Eddy Current Examinations Currently, the HMR specify periodic requalification requirements for DOT 3AL cylinders. Periodic requalification includes a volumetric expansion test and visual examination at least once every five years. In the SNPRM, we proposed to require an initial eddy current examination to be performed within three years of the effective date of this final rule, and every 5 years thereafter. Commenters generally support the proposed eddy current examination for cylinders used in SCUBA, SCBA, oxygen and carbon dioxide services. However, several commenters [CGA; Barlen; Matheson; Engineered Inspection; Western Sales; Bruecks] assert the requirement to perform the initial eddy current examination within three years of the effective date of this final rule is unnecessary and may be difficult to comply with. These commenters point out requiring the eddy current examination within three years of the effective date may result in a large number of cylinders pulled from service for requalification twice within a five year period; once for the eddy current examination and once for the scheduled periodic requalification. Several commenters [Engineered Inspection; Western Sales; Bruecks] also assert the eddy current marking could cause confusion because it is required to be marked in association with the test date of the last volumetric expansion test, which could be different from the date of the eddy current examination. Additionally, one commenter [Matheson] is concerned the few companies currently equipped to conduct eddy current examinations may become overloaded with additional test work, resulting in backlogs and test delays. To alleviate confusion and reduce the overall burden, these commenters suggest revising the amendment to require eddy current examinations at the time of a cylinder's next scheduled periodic requalification, which is required every five years. We agree. In this final rule, we are removing the proposal to perform an eddy current examination within three years of the effective date of this rule, and we are requiring an eddy current examination to be conducted at the cylinder's next required periodic requalification after January 1, 2007, the effective date of this final rule. As a result, the date stamp on each cylinder will accurately reflect the date of the last periodic requalification, including the eddy current and visual examination. D. Appendix C to Part 180 In the SNPRM, we proposed to add a new Appendix C to part 180 to specify procedures, training, and recordkeeping requirements for performing the eddy current examination and visual inspection of cylinders manufactured of aluminum alloy 6351-T6 and used in SCBA, SCUBA, oxygen and carbon dioxide services. Two commenters [CGA; Engineered Inspection] oppose the requirement to include the location and type of defect on the test report. These commenters assert this information is not necessary and increases the time required to document each examination. One commenter [Engineered Inspection] states, “details of this nature take much more time to note, and this will increase the amount of time required to perform a test. The end result will be an increased cost to the customer.” Both commenters recommend removing this requirement since the pass/fail entry on the report is sufficient to indicate whether a defect was detected during the examination. We agree. Since the eddy current with visual examination is conducted to locate SLC in the neck and shoulder of a cylinder, a pass/fail indication on the test report is sufficient for indicating whether a defect was found during the examination. Therefore, we are removing the proposal to notate the location and type of defect found on the test report. One commenter [Western Sales] opposes the use of the term “rejected” in Appendix C to part 180 to describe cylinders failing the eddy current with visual examination. The commenter asserts the term “rejected” implies the cylinder can be repaired and returned to service. The commenter recommends removing the term “rejection” and replacing it with “condemned” to ensure the cylinder is not returned to service. We agree. The terms “rejection criteria,” and “rejected” in Appendix C to part 180 were intended to indicate cylinders failing the eddy current combined with visual examination must be permanently removed from service. We did not intend to allow those cylinders to be reconditioned or reused under any circumstances. The commenter is correct the term is inconsistent with § 180.205(i), which uses the terms “cylinder condemnation,” and “condemned” to describe cylinders to be permanently removed from service. In this final rule, we are revising the terminology used in Appendix C to part 180 to be consistent with established requalification requirements. A commenter [Western Sales] also points out the owners name and symbol may not be present ( *i.e.* stamped on the cylinder). For this reason, the commenter recommends revising the language requiring a notation of the cylinder owner's name or symbol to include the words “if present.” We agree. It is not necessary to record the owner's name or symbol if it is not present or available at the time of requalification. Therefore, in this final rule, we are revising the language to require requalification records to include the cylinder owner's name or symbol, if present. This revision is consistent with established cylinder requalification recordkeeping requirements. One commenter [Western Sales] states the serial number must be included in the test report to readily identify the examined cylinder. We agree. We inadvertently omitted the cylinder serial number as a required notation on the test report. We are adding the serial number as information required to be included on the test report to identify cylinders that have been examined and tested. In addition, we are revising the training requirements for persons who perform eddy current examinations to require an employer to certify they have been trained and tested in accordance with their company's specific eddy current and visual examination procedures. We are removing references to specific training criteria. It is the employer's responsibility to ensure each employee is properly trained in the functions he or she performs. The training requirements are consistent with those specified in § 172.704. Therefore, it is not necessary to list specific training criteria for persons who perform eddy current examinations. Further, we are removing language from Appendix C to part 180, which required the visual examination to be conducted before and after the eddy current examination. After further review, we believe it is only necessary to conduct one visual inspection either before or after the eddy current examination. Cylinder requalifiers performing the visual examination prior to the eddy current examination may conduct a second visual examination afterwards to confirm the results of the eddy current examination, however, a second visual examination is not required. E. Operational Controls In the SNPRM, we proposed to add to the HMR operational controls as recommended safety practices for filling DOT 3AL cylinders manufactured of aluminum alloy 6351-T6. Two commenters [Barlen; Western Sales] oppose the proposed operational controls in the SNPRM. One commenter [Barlen] suggests it is inappropriate to require operational controls to be in place during the filling process unless we intend to provide specific instructions on “how to fill” an aluminum alloy cylinder. Another commenter [Western Sales] suggests liability issues could arise from the proposed requirement for only one person to be around a cylinder during the filling operation. We disagree. The operational controls proposed in the SNPRM are recommendations intended to emphasize persons filling DOT 3AL cylinders manufactured of aluminum alloy 6351-T6 should take additional safety precautions because of the risk of rupture during the filling process. The majority of cylinder ruptures due to SLC have occurred during the filling process. We do not believe the operational controls create potential liability issues because they are recommendations rather than mandatory requirements. III. Section-by-Section Review Part 173 Section 173.301 This section establishes general requirements for the shipment of compressed gases in cylinders. Paragraph

(d)of this section addresses the transportation of gases capable of combining chemically and prohibits the use of DOT 3AL cylinders for the transportation of pyrophoric gases. In this final rule, we are revising paragraph

(d)to remove reference to DOT 3AL cylinders manufactured of aluminum alloy 6351-T6. The prohibition is relocated to a new paragraph

(o)titled “DOT 3AL cylinders made of aluminum alloy 6351-T6.” Section 173.302 This section addresses requirements for filling cylinders with non-liquefied compressed gases. In this final rule, we are adding a new paragraph

(e)to recommend operational controls during the filling process for cylinders manufactured of aluminum alloy 6351-T6 and used in SCUBA, SCBA, and oxygen services. The operational controls will reduce the risk of personal injury and property damage during the filling process. Part 180 Section 180.205 This section establishes general requirements for the requalification of cylinders used to transport hazardous materials. Paragraph

(f)sets forth requirements for periodic visual inspections of cylinders. Paragraph (f)(4) specifically requires cylinders manufactured of aluminum alloy 6351-T6 to be inspected for evidence of SLC in the neck and shoulder areas. In this final rule, we are revising paragraph (f)(4) to reference part 180, Appendix C for requalification requirements for DOT 3AL cylinders manufactured of aluminum alloy 6351-T6 and used in SCUBA, SCBA, and oxygen services. Section 180.209 This section establishes requirements for the requalification of DOT specification cylinders. Paragraph

(a)of this section includes a table with the requalification criteria for DOT specification cylinders. In this final rule, we are amending the entry for the DOT 3AL cylinder in the “Requalification of Cylinders” table to add a reference to new paragraph (m). New paragraph

(m)requires cylinders manufactured of aluminum alloy 6351-T6 and used in SCUBA, SCBA, and oxygen services to undergo an eddy current and visual examination for early detection of SLC in the neck and shoulder area of the cylinder. We are adding a footnote

(3)to specify the eddy current and visual examinations do not apply to cylinders used for carbon dioxide, fire extinguisher or other industrial gas services. Section 180.213 This section establishes marking requirements for cylinders passing periodic requalification testing. We are revising paragraph (d), which sets forth the specific markings required, and adding a new paragraph (f)(9) to specify the requalification marking requirements for aluminum cylinders successfully passing the combined eddy current examination and visual inspection. Appendix C to Part 180 In this final rule, we are adding a new Appendix C to part 180 to specify procedures, training, and recordkeeping requirements for performing the eddy current examination and visual inspection of cylinders manufactured of aluminum alloy 6351-T6 and used in SCUBA, SCBA, and oxygen services. The new appendix includes:

(1)Eddy current and visual examination and inspection procedures to identify SLC;

(2)Eddy current equipment specifications and record retention requirements;

(3)Cylinder condemnation criteria;

(4)Record retention requirements for examinations and inspections; and,

(5)Training requirements for personnel who perform eddy current and visual examinations and inspections. IV. Regulatory Analyses and Notices A. Statutory/Legal Authority for This Rulemaking This final rule is published under authority of Federal hazardous materials transportation law (Federal hazmat law; 49 U.S.C. 5101 et seq.). Section 5103(b) of Federal hazmat law authorizes the Secretary of Transportation to prescribe regulations for the safe transportation, including security, of hazardous material in intrastate, interstate, and foreign commerce. To this end, as discussed in detail earlier in this preamble, the final rule proposes to revise current HMR requirements applicable to aluminum cylinders manufactured using aluminum alloy 6351-T6 and used in SCUBA, SCBA, and oxygen services. The purpose of the final rule is to adopt a standard for early detection of SLC to reduce the risk of a cylinder rupture and to establish a service life for cylinders manufactured of aluminum alloy 6351-T6 and used in SCUBA, SCBA, and oxygen services. B. Executive Order 12866 and DOT Regulatory Policies and Procedures This final rule is not considered a significant regulatory action under section 3(f) of Executive Order 12866 and, therefore, was not reviewed by the Office of Management and Budget. The final rule is not considered a significant rule under the Regulatory Policies and Procedures of the Department of Transportation [44 FR 11034]. The compliance costs associated with this rule are minimal. The regulatory analysis indicates the increased cost for performing an additional non-destructive examination

(NDE)and implementing operational controls is small compared to the cost and safety risks of doing nothing; it is significantly less than the cost of immediately removing all cylinders from service. We estimate the cost of the hydrostatic test and internal visual inspection required under the current regulation to be $5 per cylinder for each 5-year periodic requalification. We estimate the cost to conduct the additional visual inspection and eddy current testing required under this final rule combined with the current hydrostatic and visual inspection to be $7.25 per cylinder for each periodic requalification. Therefore, we estimate the additional annual cost associated with this final rule to be $0.45 per cylinder ($2.25 additional requalification costs/5-year requalification period). A number of cylinder owners and retesters are voluntarily utilizing NDE as part of the 5-year requalification testing process for these cylinders. We estimate about 1 million of the total population of 3.7 million cylinders are already subject to enhanced inspection and testing requirements because of voluntary actions by cylinder owners and retesters. Further, annual costs to industry will diminish with time as cylinders are condemned or voluntarily removed from service. Over the next five years, we expect the population of cylinders manufactured of aluminum alloy 6351-T6 to decrease by 500,000, decreasing the number of cylinders not currently subject to voluntary NDE to 2.2 million. Based on the foregoing analysis, we estimate initial annual costs to comply with the test and inspection requirements of this final rule to be $1.215 million (2.7 million cylinders not currently subject to NDE × $.45 NDE test costs = $1.215 million). Over a 5-year period, compliance costs will decrease to $990,000 (2.2 million cylinders × $.45 NDE test costs). Thus, the total five year compliance cost to industry will be $4.22 million. The benefits of implementing the provisions of this final rule include avoided fatalities, injuries, and damages resulting from cylinder ruptures caused by SLC. The annual benefits associated with this final rule total $1,183,125, or $5.9 million over 5 years. The cost-benefit analysis is based on information obtained from cylinder manufacturers, industrial gas companies, cylinder inspectors, and metallurgical evaluation of the ruptured cylinders. A regulatory analysis is available for review in the docket. C. Executive Order 13132 This final rule has been analyzed in accordance with the principles and criteria contained in Executive Order 13132 (“Federalism”). This final rule preempts State, local and Indian tribe requirements, but does not adopt any regulation with direct effects on the States, the relationship between the national government and the States, or the distribution of power and responsibilities among the various levels of government. Therefore, the consultation and funding requirements of Executive Order 13132 do not apply. The Federal hazardous materials transportation law, 49 U.S.C. 5101 *et seq.* , contains an express preemption provision (49 U.S.C. 5125(b)) preempting State, local, and Indian tribe requirements on certain covered subjects. Covered subjects are:

(1)The designation, description, and classification of hazardous material;

(2)The packing, repacking, handling, labeling, marking, and placarding of hazardous material;

(3)The preparation, execution, and use of shipping documents related to hazardous material and requirements related to the number, contents, and placement of those documents;

(4)The written notification, recording, and reporting of the unintentional release in transportation of hazardous material; and

(5)The design, manufacturing, fabricating, marking, maintenance, reconditioning, repairing, or testing of a packaging or container represented, marked, certified, or sold as qualified for use in transporting hazardous material. This final rule covers items 2 and 5 and would preempt any State, local, or Indian tribe requirements not meeting the “substantively the same” standard. Pursuant to § 5125(b)(2) of the Federal hazmat law, if the Secretary of Transportation issues a regulation concerning any of the covered subjects, the Secretary must determine and publish in the **Federal Register** the effective date of Federal preemption. The effective date may not be earlier than the 90th day following the date of issuance of the final rule and not later than two years after the date of issuance. PHMSA has determined the effective date of Federal preemption for these requirements will be one year from the date of publication of a final rule in the **Federal Register** . D. Executive Order 13175 This final rule has been analyzed in accordance with the principles and criteria contained in Executive Order 13175 (“Consultation and Coordination with Indian Tribal Governments”). Because this final rule does not have tribal implications, does not impose substantial direct compliance costs, and is not required by statute, the funding and consultation requirements of Executive Order 13175 do not apply. E. Regulatory Flexibility Act, Executive Order 13272, and DOT Regulatory Policies and Procedures The Regulatory Flexibility Act (5 U.S.C. 601 *et seq.* ) requires an agency to review regulations to assess their impact on small entities unless the agency determines a rule is not expected to have a significant economic impact on a substantial number of small entities. This rule imposes only minimal new costs of compliance on the regulated industry. Based on the assessment in the regulatory evaluation, I hereby certify that while this rule applies to a substantial number of small entities, there will not be a significant economic impact on those small entities. A detailed Regulatory Flexibility analysis is available for review in the docket. This final rule has been developed in accordance with Executive Order 13272 (“Proper Consideration of Small Entities in Agency Rulemaking”) and DOT's policies and procedures to promote compliance with the Regulatory Flexibility Act to ensure potential impacts of draft rules on small entities are properly considered. F. Paperwork Reduction Act PHMSA currently has an approved information collection under OMB Control No. 2137-0022, Testing, Inspection, and Marking Requirements for Cylinders with 168,431 burden hours, and an expiration date of August 31, 2008. This final rule results in an increase in annual burden and costs based on a new information collection requirement. The amendments regarding the shipment of aluminum cylinders which resulted in a new information collection requirement were submitted to the Office of Management and Budget

(OMB)for review and approval at the NPRM stage. At the request of OMB, we are re-submitting this new information collection burden request for final OMB approval at the final rule stage. Upon approval of this information collection by OMB, we will publish a separate notice in the **Federal Register** . PHMSA has developed burden estimates to reflect changes in this final rule. PHMSA estimates the total information collection and recordkeeping burden would be as follows: *OMB No. 2137-0022:* *Total Annual Number of Responders:* 103,779. *Total Annual Responses:* 168,879. *Total Annual Burden Hours:* 271,461. *Total Annual Burden Cost:* $2,614,396. *Total One-Time Start-Up Cost:* $964,000. Under the Paperwork Reduction Act of 1995, no person is required to respond to an information collection unless it has been approved by OMB and displays a valid OMB control number. Section 1320.8(d), Title 5, Code of Federal Regulations requires that PHMSA provide interested members of the public and affected agencies an opportunity to comment on information collection and recordkeeping requests. PHMSA specifically requested comments on the information collection and recordkeeping burdens associated with developing, implementing, and maintaining these requirements for approval under this final rule. Direct your requests for a copy of the information collection to Deborah Boothe or T. Glenn Foster, Office of Hazardous Materials Standards (PHH-10), Pipeline and Hazardous Materials Safety Administration (PHMSA), Room 8102, 400 Seventh Street, SW., Washington, DC 20590-0001, Telephone

(202)366-8553. In addition, you may submit comments specifically related to the information collection burden to the PHMSA Desk Officer, OMB, at fax number 202-395-6974. G. Regulation Identifier Number

(RIN)A regulation identifier number

(RIN)is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. The RIN number contained in the heading of this document can be used to cross-reference this action with the Unified Agenda. H. Unfunded Mandates Reform Act This final rule does not impose unfunded mandates under the Unfunded Mandates Reform Act of 1995. It does not result in costs of $120.7 million or more to either State, local or tribal governments, in the aggregate, or to the private sector, and is the least burdensome alternative that achieves the objective of the rule. I. Environmental Assessment The National Environmental Policy Act of 1969 (NEPA), as amended (42 U.S.C. 4321-4347), requires Federal agencies to consider the consequences of major federal actions and prepare a detailed statement on actions significantly affecting the quality of the human environment. There are no significant environmental impacts associated with this final rule. PHMSA is amending requirements in the HMR pertaining to DOT 3AL aluminum cylinders. The purpose of this rulemaking initiative is to minimize personal injury during the filling process and to adopt a standard for early detection of sustained load cracking of cylinders manufactured of aluminum alloy 6351-T6 in order to reduce the risk of a cylinder rupture. Adopting a standard for early detection of sustained load cracking in order to reduce the risk of a cylinder rupture has no potential for environmental damage or contamination. J. Privacy Act 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.* List of Subjects 49 CFR Part 173 Hazardous materials transportation, Incorporation by reference, Packaging and containers, Radioactive materials, Reporting and recordkeeping requirements, Uranium. 49 CFR Part 180 Hazardous materials transportation, Incorporation by reference, Motor vehicle safety, Packaging and containers, Reporting and recordkeeping requirements. In consideration of the foregoing, we are amending 49 CFR Chapter I, Subchapter C as follows: PART 173—SHIPPERS—GENERAL REQUIREMENTS FOR SHIPMENT AND PACKAGES 1. The authority citation for part 173 continues to read as follows: Authority: 49 U.S.C. 5101-5128, 44701; 49 CFR 1.45, 1.53. 2. In § 173.301, paragraph

(d)is revised and a new paragraph

(o)is added to read as follows: § 173.301 General requirements for shipment of compressed gases and other hazardous materials in cylinders, UN pressure receptacles and spherical pressure vessels.

(d)*Gases capable of combining chemically.* A filled cylinder may not contain any gas or material capable of combining chemically with the cylinder's contents or with the cylinder's material of construction, so as to endanger the cylinder's serviceability.

(o)*DOT 3AL cylinders made of aluminum alloy 6351-T6.* A DOT 3AL cylinder manufactured of aluminum alloy 6351-T6 may not be filled and offered for transportation or transported with pyrophoric gases. 3. In § 173.302, a new paragraph

(e)is added to read as follows: § 173.302 Filling of cylinders with nonliquefied (permanent) compressed gases.

(e)*DOT 3AL cylinders manufactured of 6351-T6 aluminum alloy.* Suitable safeguards should be provided to protect personnel and facilities should failure occur while filling cylinders manufactured of aluminum alloy 6351-T6 used in self-contained underwater breathing apparatus (SCUBA), self-contained breathing apparatus

(SCBA)or oxygen service. The cylinder filler should allow only those individuals essential to the filling process to be in the vicinity of the cylinder during the filling process. PART 180—CONTINUING QUALIFICATION AND MAINTENANCE OF PACKAGINGS 4. The authority citation for part 180 continues to read as follows: Authority: 49 U.S.C. 5101-5128; 49 CFR 1.53. 5. In § 180.205, paragraph (f)(4) is revised to read as follows: § 180.205 General requirements for requalification of specification cylinders.

(f)* * *

(4)In addition to other requirements prescribed in this paragraph (f), each specification cylinder manufactured of aluminum alloy 6351-T6 and used in self-contained underwater breathing apparatus (SCUBA), self-contained breathing apparatus (SCBA), or oxygen service must be inspected for sustained load cracking in accordance with Appendix C of this part at the first scheduled 5-year requalification period after January 1, 2007, and every five years thereafter. 6. In § 180.209, in paragraph (a), in the “Requalification of Cylinders table” the entry “DOT 3AL” is revised, and a new paragraph

(m)is added to read as follows: § 180.209 Requirements for requalification of specification cylinders.

(a)* * * Table 1.—Requalification of Cylinders 1 Specification under which cylinder was made Minimum test pressure (psig.) 2 Requalification period (years) * * * * * * * DOT 3AL 5/3 times service pressure 5 or 12 (see § 180.209(j) and § 180.209(m) 3 ). * * * * * * * 1 Any cylinder not exceeding 2 inches outside diameter and less than 2 feet in length is excepted from volumetric expansion test. 2 For cylinders not marked with a service pressure, see § 173.301(e)(1) of this subchapter. 3 This provision does not apply to cylinders used for carbon dioxide, fire extinguisher or other industrial gas service.

(m)*DOT-3AL cylinders manufactured of 6351-T6 aluminum alloy.* In addition to the periodic requalification and marking described in § 180.205, each cylinder manufactured of aluminum alloy 6351-T6 used in self-contained underwater breathing apparatus (SCUBA), self-contained breathing apparatus (SCBA), or oxygen service must be requalified and inspected for sustained load cracking in accordance with the non-destructive examination method described in the following table. Each cylinder with sustained load cracking that has expanded into the neck threads must be condemned in accordance with § 180.205(i). This provision does not apply to cylinders used for carbon dioxide, fire extinguisher or other industrial gas service. Requalification and Inspection of DOT-3AL Cylinders Made of Aluminum Alloy 6351-T6 Requalification requirement Examination procedure 1 Sustained Load Cracking Condemnation Criteria 2 Requalification period (years) Eddy current examination combined with visual inspection Eddy current—In accordance with Appendix C of this part Visual inspection—In accordance with CGA Pamphlet C-6.1 (IBR; see § 171.7 of this subchapter) Any crack in the neck or shoulder of 2 thread lengths or more 5 1 The requalifier performing eddy current must be familiar with the eddy current equipment and must standardize (calibrate) the system in accordance with the requirements provided in Appendix C to this part. 2 The eddy current must be applied from the inside of the cylinder's neck to detect any sustained load cracking that has expanded into the neck threads. 7. In § 180.213, paragraph

(d)is revised and a new paragraph (f)(9) is added to read as follows: § 180.213 Requalification markings.

(d)*Requalification markings.* Each cylinder successfully passing requalification must be marked with the RIN set in a square pattern, between the month and year of the requalification date. The first character of the RIN must appear in the upper left corner of the square pattern; the second in the upper right; the third in the lower right; and the fourth in the lower left. Example: A cylinder requalified in September 2006, and approved by a person who has been issued RIN “A123”, would be marked plainly and permanently into the metal of the cylinder in accordance with location requirements of the cylinder specification or on a metal plate permanently secured to the cylinder in accordance with paragraph

(b)of this section. An example of the markings prescribed in this paragraph

(d)is as follows: A1 9 06 X 32 Where: “9” is the month of requalification “A123” is the RIN “06” is the year of requalification, and “X” represents the symbols described in paragraphs (f)(2) through (f)(9) of this section.

(f)* * *

(9)For designation of the eddy current examination combined with a visual inspection, the marking is as illustrated in paragraph

(d)of this section, except the “X” is replaced with the letters “VE.” 8. In part 180, Appendix C is added to read as follows: Appendix C to Part 180—Eddy Current Examination With Visual Inspection for DOT 3AL Cylinders Manufactured of Aluminum Alloy 6351-T6 1. *Examination Procedure.* Each facility performing eddy current examination with visual inspection must develop, update, and maintain a written examination procedure applicable to the test equipment it uses to perform eddy current examinations. 2. *Visual examinations* . Visual examinations of the neck and shoulder area of the cylinder must be conducted in accordance with CGA pamphlet C-6.1 (IBR; see § 171.7 of this subchapter). 3. *Eddy Current Equipment.* A reference ring and probe for each DOT-3AL cylinder manufactured of aluminum alloy 6351-T6 to be inspected must be available at the examination facility. Eddy current equipment must be capable of accurately detecting the notches on the standard reference ring. 4. *Eddy Current Reference Ring.* The reference ring must be produced to represent each cylinder to be tested. The reference ring must include artificial notches to simulate a neck crack. The size of the artificial notch (depth and length) must have a depth less than or equal to 1/3 of the wall thickness of the neck and a length greater than or equal to two threads. The standard reference must have a drawing that includes the diameter of the ring, and depth and length of each notch. 5. *Condemnation Criteria.* A cylinder must be condemned if the eddy current examination combined with visual examination reveals any crack in the neck or shoulder of 2 thread lengths or more. 6. *Examination equipment records.* Records of eddy current inspection equipment shall contain the following information:

(i)Equipment manufacturer, model number and serial number.

(ii)Probe description and unique identification ( *e.g.* , serial number, part number, etc.). 7. *Eddy current examination reporting and record retention requirements.* Daily records of eddy current examinations must be maintained by the person who performs the requalification until either the expiration of the requalification period or until the cylinder is again requalified, whichever occurs first. These records shall be made available for inspection by a representative of the Department on request. Eddy current examination records shall contain the following information:

(i)Specification of each standard reference ring used to perform the eddy current examination.

(ii)DOT specification or exemption number of the cylinder; manufacturer's name or symbol; owner's name or symbol, if present; serial number; and, date of manufacture.

(iii)Name of test operator performing the eddy current examination.

(iv)Date of eddy current examination.

(vi)Acceptance/condemnation results ( *e.g.* pass or fail).

(vii)Retester identification number. 8. *Personnel Qualification Requirements.* Each person who performs eddy current and visual examinations, and evaluates and certifies retest results must be certified by the employer that he/she has been properly trained and tested in the eddy current and visual examination procedures. 9. *Training Records.* A record of current training must be maintained for each employee who performs eddy current and visual examinations in accordance with § 172.704(d). Issued in Washington, DC, on August 22, 2006, under authority delegated in 49 CFR part 1. Thomas J. Barrett, Administrator. [FR Doc. E6-14255 Filed 8-28-06; 8:45 am] BILLING CODE 4910-60-P DEPARTMENT OF TRANSPORTATION National Highway Traffic Safety Administration 49 CFR Part 571 [Docket No. NHTSA-2005-21244] RIN 2127-AJ59 Federal Motor Vehicle Safety Standards; Occupant Crash Protection AGENCY: National Highway Traffic Safety Administration (NHTSA), Department of Transportation (DOT). ACTION: Final rule; delay of compliance date. SUMMARY: Under the current version of Federal Motor Vehicle Safety Standard (FMVSS) No. 208, vehicles that are manufactured on or after September 1, 2006, are certified to the suppression requirements and have a child restraint anchorage system, commonly referred to as a Lower Anchors and Tethers for Children or “LATCH” system, in the right front passenger seating position must suppress the air bag for that position when a child restraint is installed at that position with the LATCH system. However, the standard does not yet specify detailed procedures for installing that type of child restraint in order to conduct the suppression test. In a notice of proposed rulemaking

(NPRM)published May 19, 2005, NHTSA proposed the needed installation procedures and proposed an effective date for the final rule following the NPRM. The agency anticipated in the NPRM that a final rule would be issued by September 1, 2006, that provided sufficient leadtime for vehicles to meet the suppression requirements with LATCH-equipped child restraints. Because we have not completed our response to the comments to the NPRM, this final rule delays, for one year, the compliance date of the requirement for vehicles to meet the air bag suppression requirement with LATCH-equipped child restraints. This delay allows us additional time to publish our final action on the rulemaking. DATES: The amendments made by this final rule are effective September 1, 2006. The compliance date for the requirement for vehicles to meet the air bag suppression requirements with LATCH-equipped child restraints is delayed until September 1, 2007. *Petitions for reconsideration:* Petitions for reconsideration of this final rule must be received not later than October 13, 2006. ADDRESSES: Petitions for reconsideration of this final rule must refer to the docket and notice number set forth above and be submitted to the Administrator, National Highway Traffic Safety Administration, 400 Seventh Street, SW., Washington, DC 20590, with a copy to Docket Management, Room PL-401, 400 Seventh Street, SW., Washington, DC 20590. Note that all comments received will be posted without change to *http://dms.dot.gov* , including any personal information provided. Please see the Privacy Act heading under Rulemaking Analyses and Notices. *Docket:* For access to the docket to read background documents, go to *http://dms.dot.gov* , or 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. FOR FURTHER INFORMATION CONTACT: Carla Cuentas, Office of Crashworthiness Standards, Light Duty Vehicle Division (telephone 202-366-1740, fax 202-493-2739); or Deirdre Fujita, Office of Chief Counsel (telephone 202-366-2992, fax 202-366-3820). Both of these officials can be reached at the National Highway Traffic Safety Administration, 400 Seventh St., SW., Washington, DC 20590. SUPPLEMENTARY INFORMATION: I. Background Federal Motor Vehicle Safety Standard (FMVSS) No. 208, “Occupant crash protection” (49 CFR 571.208), requires passenger vehicles to be equipped with safety belts and frontal air bags for the protection of vehicle occupants in crashes. On May 12, 2000, NHTSA published a final rule to require that air bags be designed to provide improved frontal crash protection for all occupants, by means that include advanced air bag technology (“Advanced Air Bag Rule,” 65 FR 30680, Docket No. NHTSA 00-7013). Under the Advanced Air Bag Rule, manufacturers are provided several compliance options in order to minimize the risk to infants and small children from deploying air bags, including an option to suppress an air bag in the presence of a child restraint system (CRS). Manufacturers choosing to rely on an air bag suppression system to minimize the risk to children in a CRS must ensure that the vehicle complies with the suppression requirements when tested with the CRSs specified in Appendix A of the standard (see S19, S21 and S23 of FMVSS No. 208). On November 19, 2003, NHTSA revised Appendix A by adding two CRSs that are equipped with components that attach to a vehicle's LATCH 1 system (68 FR 65179, Docket No. NHTSA 03-16476). On August 20, 2004, the agency responded to a request for additional leadtime by extending the compliance date (from September 1, 2004 to September 1, 2006). Thus, under that final rule, vehicles manufactured on or after September 1, 2006, and certified as meeting the suppression requirements must meet the requirements when tested with the LATCH-equipped CRSs installed on a LATCH system (69 FR 51598; Docket No. NHTSA 2004-18905). 1 “LATCH” stands for “Lower Anchors and Tethers for Children,” a term that was developed by child restraint manufacturers and retailers to refer to the standardized child restraint anchorage system that vehicle manufacturers must install in vehicles pursuant to FMVSS No. 225 *Child Restraint Anchorage Systems (49 CFR 571.225).* The Latch system is comprised of two lower anchorages and one tether anchorage. Each lower anchorage is a rigid round rod or bar onto which the connector of a child restraint system can be attached. FMVSS No. 225 does not permit vehicle manufacturers to install LATCH systems in front designated seating positions unless the vehicle has an air bag on-off switch meeting the requirements of S4.5.4 of FMVSS No. 208. The NPRM FMVSS No. 208 currently does not provide a specific procedure for installing a LATCH-equipped CRS in a vehicle in order to conduct air bag suppression testing. To address this, NHTSA published an NPRM on May 19, 2005, proposing a specific procedure for installing LATCH-equipped CRSs (70 FR 28878, Docket 21244; extension of comment period, July 13, 2005, 70 FR 40280). The agency believed that the procedure, which was based on how CRSs are installed in the real world, would provide for repeatable and reproducible installation of the child restraints (70 FR 28878; Docket 21244). II. Extension of Compliance Date The Alliance of Automobile Manufacturers (the Alliance) submitted several comments on the NPRM. General Motors, a member of the Alliance, also commented separately. These commenters expressed concerns that aspects of the proposed test procedure allowed for “too much variability to be a suitable test procedure” (Alliance comment, August 17, 2005), and recommended a number of modifications to improve the procedure. Because we have not completed our response to the comments to the NPRM, and due to the closeness of the September 1, 2006 compliance date, this final rule delays, for one year, the effective date of the requirement that vehicles manufactured certify that their vehicles comply with the suppression requirements when tested with the LATCH-equipped CRSs. This delay allows us additional time to take final action on the proposal. As to whether additional lead time beyond that provided by the September 1, 2007 date is needed to allow for manufacturer implementation of the test procedures, that issue will be addressed by the final rule completing this rulemaking action (RIN 2127-AJ59). We find good cause for making this rule delaying the current September 1, 2006 compliance date effective in less than 30 days, *i.e.* , September 1, 2006. For reasons discussed in our proposal, we tentatively concluded that certain amendments should be made that would provide needed guidance to manufacturers, and also that the compliance date of the relevant requirements should be delayed. If the September 1, 2006 compliance date were not changed, the absence of any established test procedures would affect the ability of manufacturers to certify compliance with those requirements. III. Rulemaking Analyses and Notices A. Executive Order 12866 and DOT Regulatory Policies and Procedures This rulemaking document was not reviewed by the Office of Management and Budget under E.O. 12866. It is not considered to be significant under E.O. 12866 or the Department's Regulatory Policies and Procedures (44 FR 11034; February 26, 1979). This document delays the date on which a requirement that certain vehicles meet the air bag suppression requirements with LATCH-equipped CRSs is to become effective. Since the delay maintains the status quo, manufacturers will incur no costs as a result of this document The impacts of today's amendment are so minimal so as not to warrant preparation of a regulatory evaluation. B. Regulatory Flexibility Act In compliance with the Regulatory Flexibility Act, 5 U.S.C. 60l *et seq.* , NHTSA has evaluated the effects of this action on small entities. I hereby certify that this final rule will not have a significant impact on a substantial number of small entities. The delay of the effective date preserves the status quo and will not affect the responsibilities of small entities. C. Executive Order No. 13132 NHTSA has analyzed this final rule in accordance with the principles and criteria set forth in Executive Order 13132, Federalism, and has determined that this rule does not have sufficient Federal implications to warrant consultation with State and local officials or the preparation of a Federalism summary impact statement. The rule will not have any substantial impact on the States, or on the current Federal-State relationship, or on the current distribution of power and responsibilities among the various local officials. However, under 49 U.S.C. 30103, whenever a Federal motor vehicle safety standard is in effect, a State may not adopt or maintain a safety standard applicable to the same aspect of performance which is not identical to the Federal standard, except to the extent that the state requirement imposes a higher level of performance and applies only to vehicles procured for the State's use. D. National Environmental Policy Act NHTSA has analyzed this rule for the purposes of the National Environmental Policy Act. The agency has determined that implementation of this action would not have any significant impact on the quality of the human environment. E. Paperwork Reduction Act Under the new procedures established by the Paperwork Reduction Act of 1995, a person is not required to respond to a collection of information by a Federal agency unless the collection displays a valid OMB control number. This final rule does not establish any new information collection requirements. F. National Technology Transfer and Advancement Act Under the National Technology Transfer and Advancement Act of 1995 (NTTAA) (Public Law 104-113), “all Federal agencies and departments shall use technical standards that are developed or adopted by voluntary consensus standards bodies, using such technical standards as a means to carry out policy objectives or activities determined by the agencies and departments.” There are no voluntary consensus standards affecting this final rule. G. Civil Justice Reform This final rule will not have any retroactive effect. As noted above in the discussion of Executive Order No. 13132, whenever a Federal motor vehicle safety standard is in effect, a State may not adopt or maintain a safety standard applicable to the same aspect of performance which is not identical to the Federal standard, except to the extent that the state requirement imposes a higher level of performance and applies only to vehicles procured for the State's use. 49 U.S.C. 30161 sets forth a procedure for judicial review of final rules establishing, amending or revoking Federal motor vehicle safety standards. That section does not require submission of a petition for reconsideration or other administrative proceedings before parties may file suit in court. H. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 requires agencies to prepare a written assessment of the costs, benefits and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually (adjusted for inflation with base year of 1995). This final rule will not result in expenditures by State, local or tribal governments, in the aggregate, or by the private sector in excess of $100 million annually. I. Executive Order 13045 Executive Order 13045 (62 FR 19885, April 23, 1997) applies to any rule that:

(1)Is determined to be “economically significant” as defined under E.O. 12866, and

(2)concerns an environmental, health, or safety risk that NHTSA has reason to believe may have a disproportionate effect on children. This final rule is not subject to the Executive Order because it is not economically significant as defined in E.O. 12866. J. Executive Order 13211 Executive Order 13211 (66 FR 28355, May 18, 2001) applies to any rule that:

(1)Is determined to be economically significant as defined under E.O. 12866, and is likely to have a significantly adverse effect on the supply of, distribution of, or use of energy; or

(2)that is designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. This final rule is not subject to E.O. 13211. K. Regulation Identifier Number

(RIN)The Department of Transportation assigns a regulation identifier number

(RIN)to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. You may use the RIN contained in the heading at the beginning of this document to find this action in the Unified Agenda. L. Privacy Act 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.* List of Subjects in 49 CFR Part 571 Imports, Motor vehicle safety, Reporting and recordkeeping requirements, Tires. In consideration of the foregoing, NHTSA amends chapter V of title 49 of the Code of Federal Regulations by amending 49 CFR part 571 as follows: PART 571—[AMENDED] 1. The authority citation for part 571 of Title 49 continues to read as follows: Authority: 49 U.S.C. 322, 30111, 30115, 30117 and 30166; delegation of authority at 49 CFR 1.50. 2. Section 571.208 is amended by revising section C of Appendix A, to read as follows: § 571.208 Standard No. 208; Occupant crash protection. Appendix A to § 571.208—Selection of Child Restraint Systems C. Any of the following forward facing toddler and forward-facing convertible child restraint systems, manufactured on or after December 1, 1999, may be used by the National Highway Traffic Safety Administration to test the suppression system of a vehicle that is manufactured on or after the effective date and prior to the termination date specified in the table below and that has been certified as being in compliance with 49 CFR 571.208 S19, or S21. (Note: Any child restraint listed in this subpart that is not recommended for use in a rear-facing position by its manufacturer is excluded from use in S20.2.1.4): Effective and termination dates January 17, 2002 September 1, 2007 Britax Roundabout 161 Effective Remains Effective. Britax Expressway Effective. Century Encore 4612 Effective Remains Effective. Century STE 1000 4416 Effective Remains Effective. Cosco Olymp ian 02803 Effective Remains Effective. Cosco Touriva 02519 Effective Remains Effective. Evenflo Horizon V 425 Effective Remains Effective. Evenflo Medallion 254 Effective Remains Effective. Safety 1st Comfort Ride 22-400 Effective. Issued: August 22, 2006. Nicole R. Nason, Administrator. [FR Doc. E6-14256 Filed 8-28-06; 8:45 am] BILLING CODE 4910-59-P DEPARTMENT OF TRANSPORTATION National Highway Traffic Safety Administration 49 CFR Part 571 [Docket No. NHTSA 2006-24497] RIN 2127-AI93 Federal Motor Vehicle Safety Standards; Occupant Protection in Interior Impact AGENCY: National Highway Traffic Safety Administration (NHTSA), Department of Transportation (DOT). ACTION: Final rule; delay of compliance date. SUMMARY: Our safety standard on occupant protection in interior impact requires, in part, that light vehicles provide head protection when an occupant's head strikes upper interior components, such as pillars, side rails, headers, and the roof during a crash. While these requirements already apply to most vehicles, the compliance date for altered vehicles and vehicles built in two or more stages is September 1, 2006. In April 2006, we responded to two petitions for rulemaking by proposing certain amendments to the head protection requirements as they apply to these vehicles. We also proposed to delay the compliance date of the requirements for these vehicles until September 1, 2008. Given the short period of time until the current September 1, 2006 compliance date, and as a partial step toward completing action on the April 2006 proposal, we are, by this final rule, delaying the compliance date for one year. This will give us time to fully analyze the comments and reach a decision on other aspects of the proposal, including the proposed additional delay in the compliance date. DATES: The amendments made by this final rule are effective September 1, 2006. The compliance date for the head impact protection requirements for altered vehicles and vehicles built in two or more stages is delayed until September 1, 2007. *Petitions for reconsideration:* Petitions for reconsideration of this final rule must be received not later than October 13, 2006. ADDRESSES: Petitions for reconsideration of this final rule must refer to the docket and notice number set forth above and be submitted to the Administrator, National Highway Traffic Safety Administration, 400 Seventh Street, SW., Washington, DC 20590, with a copy to Docket Management, Room PL-401, 400 Seventh Street, SW., Washington, DC 20590. Note that all documents received will be posted without change to *http://dms.dot.gov* , including any personal information provided. Please see the Privacy Act heading under Rulemaking Analyses and Notices. *Docket:* For access to the docket to read background documents, go to *http://dms.dot.gov* , or 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. FOR FURTHER INFORMATION CONTACT: The following persons at the National Highway Traffic Safety Administration, 400 7th Street, SW., Washington, DC 20590: *For technical and policy issues:* Lori Summers, Office of Crashworthiness Standards, telephone:

(202)366-4917, facsimile:

(202)366-4329, e-mail: *Lori.Summers@dot.gov* . *For legal issues:* Edward Glancy, Office of the Chief Counsel, telephone:

(202)366-2992, facsimile:

(202)366-3820. SUPPLEMENTARY INFORMATION: Federal Motor Vehicle Safety Standard (FMVSS) No. 201, *Occupant Protection in Interior Impact* , requires, in part, that light vehicles provide head protection when an occupant's head strikes upper interior components, such as pillars, side rails, headers, and the roof during a crash. While these requirements already apply to most vehicles, the compliance date for altered vehicles and vehicles built in two or more stages is September 1, 2006. The Recreation Vehicle Industry Association

(RVIA)and the National Truck Equipment Association

(NTEA)petitioned the agency to exclude permanently certain types of altered vehicles and vehicles manufactured in two or more stages from these requirements. On April 24, 2006, NHTSA published in the **Federal Register** (71 FR 20932) a document responding to these petitions for rulemaking and proposing certain amendments to the standard. Based on a careful consideration of both the safety benefits of the upper interior protection requirements, and practicability concerns relating to vehicles built in two or more stages and certain altered vehicles, we proposed to limit these requirements to only the front seating positions of those vehicles. Further, we tentatively concluded that it is appropriate to exclude a narrow group of multi-stage vehicles delivered to the final stage manufacturer without an occupant compartment because of impracticability concerns. We also proposed to delay the effective date of the head impact protection requirements as they apply to final stage manufacturers and alterers until September 1, 2008. We received two comments on the proposal, from RVIA and NTEA. Both commenters supported delaying the existing compliance date. The two commenters also each raised a number of issues about certain aspects of our proposal, and asked the agency to provide additional relief. Given the short period of time until the current September 1, 2006 compliance date, and as a partial step toward completing action on the April 2006 proposal, we have decided, at this time, to delay the compliance date for one year. This will give us time to fully analyze the comments and reach a decision on other aspects of the proposal, including the proposed additional delay in the compliance date. We find good cause for making this rule delaying the current September 1, 2006 compliance date effective in less than 30 days, i.e., September 1, 2006. For reasons discussed in our April 2006 proposal, we have tentatively concluded that certain amendments should be made that would provide relief to final stage manufacturers and alterers, and also that the compliance date of the relevant requirements should be delayed. If the September 1, 2006 compliance date were not changed, it is likely that some final stage manufacturers and alterers would need to immediately stop producing or altering some of the specialty vehicles they provide. Regulatory Analyses and Notices A. Executive Order 12866 and DOT Regulatory Policies and Procedures Executive Order 12866, “Regulatory Planning and Review” (58 FR 51735, October 4, 1993), provides for making determinations whether a regulatory action is “significant” and therefore subject to Office of Management and Budget

(OMB)review and to the requirements of the Executive Order. The Order defines a “significant regulatory action” as one that is likely to result in a rule that may:

(1)Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or Tribal governments or communities;

(2)Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;

(3)Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or

(4)Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order. This final rule was not reviewed under Executive Order 12866. It is not significant within the meaning of the DOT Regulatory Policies and Procedures. It does not impose any new burdens on manufacturers of vehicles built in two or more stages or vehicle alterers. It only delays the compliance date for certain existing requirements as they apply to multistage vehicles and alterers. The agency believes that this impact is so minimal as to not warrant the preparation of a full regulatory evaluation. B. Regulatory Flexibility Act The Regulatory Flexibility Act of 1980 (5 U.S.C. 601 *et seq* .) requires agencies to evaluate the potential effects of their rules on small businesses, small organizations and small governmental jurisdictions. I have considered the effects of this rulemaking action under the Regulatory Flexibility Act and certify that it will not have a significant economic impact on a substantial number of small entities. Under 13 CFR 121.201, the Small Business Administration

(SBA)defines small business (for the purposes of receiving SBA assistance) as a business with less than 750 employees. Most of the manufacturers of recreation vehicles, conversion vans, and specialized work trucks are small businesses that alter completed vehicles or manufacture vehicles in two or more stages. While the number of these small businesses is substantial, the economic impact upon these entities will not be significant because this document only delays the compliance date of certain existing requirements as they apply to multistage vehicles and alterers. C. National Environmental Policy Act NHTSA has analyzed this rule for the purposes of the National Environmental Policy Act. The agency has determined that implementation of this action will not have any significant impact on the quality of the human environment. Accordingly, no environmental assessment is required. D. Executive Order 13132 (Federalism) The agency has analyzed this rulemaking in accordance with the principles and criteria contained in Executive Order 13132 and has determined that it does not have sufficient federal implications to warrant consultation with State and local officials or the preparation of a federalism summary impact statement. The rule will not have any substantial impact on the States, or on the current Federal-State relationship, or on the current distribution of power and responsibilities among the various local officials. However, under 49 U.S.C. 30103, whenever a Federal motor vehicle safety standard is in effect, a State may not adopt or maintain a safety standard applicable to the same aspect of performance which is not identical to the Federal standard, except to the extent that the state requirement imposes a higher level of performance and applies only to vehicles procured for the State's use. E. Unfunded Mandates Act The Unfunded Mandates Reform Act of 1995 requires agencies to prepare a written assessment of the costs, benefits and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually ($120.7 million as adjusted annually for inflation with base year of 1995). The assessment may be combined with other assessments, as it is here. This rule will not result in expenditures by State, local or tribal governments or automobile manufacturers and/or their suppliers of more than $120.7 million annually. It will not impose any new burdens on manufacturers of vehicles built in two or more stages or vehicle alterers. F. Executive Order 12988 (Civil Justice Reform) This rule will not have any retroactive effect. As noted above in the discussion of Executive Order No. 13132, whenever a Federal motor vehicle safety standard is in effect, a State may not adopt or maintain a safety standard applicable to the same aspect of performance which is not identical to the Federal standard, except to the extent that the State requirement imposes a higher level of performance and applies only to vehicles procured for the State's use. 49 U.S.C. 30161 sets forth a procedure for judicial review of final rules establishing, amending, or revoking Federal motor vehicle safety standards. That section does not require submission of a petition for reconsideration or other administrative proceedings before parties may file a suit in court. G. Paperwork Reduction Act There are no information collection requirements in this rule. H. Regulation Identifier Number

(RIN)The Department of Transportation assigns a regulation identifier number

(808)397-2657. *FWS contact:* Barry Stieglitz, Monument Project Leader (USFWS); Hawaiian and Pacific Islands NWR Complex, 300 Ala Moana Boulevard, Box 50167, Honolulu, HI 96850-5000; 808-792-9540. *State of Hawaii contact:* Athline Clark, Special Projects Manager, Department of Land and Natural Resources, Division of Aquatic Resources; 1151 Punchbowl Street, Room 330, Honolulu, HI 96813;

(808)587-0099. SUPPLEMENTARY INFORMATION: On June 15, 2006, President Bush established the Northwestern Hawaiian Islands Marine National Monument by issuing Presidential Proclamation 8031 (71 FR 36443, June 26, 2006) under the authority of the Antiquities Act

(Act)(16 U.S.C. 431). The Proclamation reserves all lands and interests in lands owned or controlled by the Government of the United States in the Northwestern Hawaiian Islands (NWHI), including emergent and submerged lands and waters, out to a distance of approximately 50 nautical miles

(nmi)from the islands. The outer boundary of the Monument is approximately 100 nmi wide and extends approximately 1200 nmi around coral islands, seamounts, banks, and shoals. The area includes the Northwestern Hawaiian Islands Coral Reef Ecosystem Reserve, the Midway Atoll National Wildlife Refuge/Battle of Midway National Memorial, and the Hawaiian Islands National Wildlife Refuge. The Proclamation appropriated and withdrew the area from all forms of entry, location, selection, sale, or leasing or other disposition under the public land laws, including, but not limited to, withdrawal from location, entry, and patent under mining laws, and from disposition under all laws relating to mineral and geothermal leasing. The Proclamation provides that the Secretary of Commerce, through NOAA, has primary responsibility regarding the management of the marine areas of the Monument, in consultation with the Secretary of the Interior. The Secretary of the Interior, through the USFWS, has sole responsibility for management of the areas of the Monument that overlay the Midway Atoll National Wildlife Refuge, the Battle of Midway National Memorial, and the Hawaiian Islands National Wildlife Refuge, in consultation with the Secretary of Commerce. Further, the Proclamation provides that nothing in the Proclamation diminishes or enlarges the jurisdiction of the State of Hawaii. The Monument includes state waters, including the Northwestern Hawaiian Islands State Marine Refuge and Kure Atoll Wildlife Sanctuary. The State currently holds the submerged and ceded lands of the NWHI in trust. This public trust is overseen by the Office of Hawaiian Affairs through an amendment to the Constitution of the State of Hawaii. The State of Hawaii has primary responsibility for managing the State waters of the Monument. The three principal entities with responsibility for managing lands and waters of the Monument—NOAA, USFWS, and the State of Hawaii (collectively, the Co-Trustees)—are working cooperatively and will consult to administer the Monument. The Co-Trustees have established a goal to provide unified management in the spirit of cooperative conservation. This relationship will be further described in a Memorandum of Agreement among the Co-Trustees. The Proclamation requires restrictions and prohibitions regarding activities in the Monument consistent with the authority provided by the Act. The Proclamation shall be applied in accordance with international law. No restrictions shall apply to or be enforced against a person who is not a citizen, national, or resident alien of the United States (including foreign flag vessels) unless in accordance with international law. NOAA and USFWS are promulgating as final regulations the management measures and prohibitions set forth in the Proclamation to codify them in the Code of Federal Regulations. This action will provide additional notice to the public and other interested parties of the terms of the Proclamation and activities that are prohibited or regulated and thereby facilitate improved compliance. Interested parties may view Hawaii Administrative Rules also applicable within the Monument at *http://www.hawaii.gov/dlnr/dar/fish_regs/nwhi.htm.* These regulations address the requirement in the Proclamation that the Secretaries shall ensure, in addition to other things, that commercial fishing for bottomfish and other associated pelagic species may continue in the Monument for no more than 5 years. Section 404.10 sets out the conditions under which such fishing may continue to be conducted. However, commercial fishing remains prohibited in areas of the Monument not open to such fishing prior to issuance of the Proclamation. Classification Administrative Procedure Act The Secretaries find good cause to waive notice and comment on these regulations, pursuant to 5 U.S.C. 533(b)(B), and the 30-day delay in effective date pursuant to 5 U.S.C. 553(d). Notice and comment are unnecessary and contrary to the public interest because these regulations do not expand on the action already taken by the President in the Proclamation. The Proclamation became effective upon issuance on June 15, 2006. These regulations codify the prohibitions and management measures set forth in the Proclamation. Therefore, these regulations are being published as final regulations and are effective August 25, 2006. E.O. 12866 This rule has been determined to be significant for purposes of E.O. 12866. Paperwork Reduction Act This rule contains a collection-of-information requirement that was submitted to OMB for emergency approval under the Paperwork Reduction Act (PRA). The collection-of-information requirement was approved by OMB and granted OMB control number 0648-0548 which expires on February 28, 2007. We are now requesting comment on this information collection requirement for OMB's subsequent review and approval on a non-emergency basis. The public reporting burden for this information collection is described in the table below. The public reporting burden for permit applications and associated reporting requirements is estimated to average 1 hour per response. The public reporting burden for entry and exit notification is expected to average 15 minutes per response. The public reporting burden for VMS checklist certification is estimated to average 5 minutes per response. Each of these public reporting burdens includes the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Applicant Burden Permit type Permits and other reporting per year Responses per requirement Total responses Hours/response Total hours Annual recordkeeping/reporting cost per response (dollar) Total annual cost (dollar)

(a)General 33 3 99 1 99 1.00 99.00

(b)Special Ocean Use 5 3 15 24 360 1.00 15.00

(c)Native Hawaiian Practices 2 2 4 4 16 1.00 4.00

(d)Recreation 2 3 6 1 6 1.00 6.00

(e)Entry & Exit Notice 174 2 348 5 minutes 29 0.00 0.00

(f)Purchase and installation of VMS 50 NA NA 4 hours 50 899 (initial cost: $3595) 44,950.00

(g)VMS maintenance 50 NA NA 4 hours 200 0 0

(h)VMS Certification 50 0.25 12.5 5 minutes 4 0.25 13.00

(i)Hourly VMS reports 50 3805 190,224 5 seconds 264 1.28/day 10,145.00 Total 124 190,709 1028 55,232.00 Note: VMS installation and activation hours and purchase costs are annualized by dividing by 4 years, the expected service life. Public comment is sought regarding: whether this 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 Diana Hynek, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6625, 14th and Constitution Avenue, NW, Washington, DC 20230, or via e-mail at *dHynek@noaa.gov.* 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 404 Administrative practice and procedure, Coastal zone, Fish, Fisheries, Historic preservation, Intergovernmental relations, Marine resources, Monuments and memorials, Natural resources, Reporting and recordkeeping requirements, Wildlife, Wildlife refuges. Dated: August 24, 2006. Conrad C. Lautenbacher Jr., Vice Admiral, U.S. Navy (Ret.), Undersecretary of Commerce for Oceans and Atmosphere. Dated: August 24, 2006. David M. Verhey, Acting Assistant Secretary for Fish and Wildlife and Parks. Accordingly, NOAA and USFWS add part 404, title 50 of the Code of Federal Regulations as follows: PART 404—NORTHWESTERN HAWAIIAN ISLANDS MARINE NATIONAL MONUMENT Sec. 404.1 Scope and purpose. 404.2 Boundary. 404.3 Definitions. 404.4 Access to the Monument. 404.5 Requirements for a vessel monitoring system. 404.6 Prohibited activities. 404.7 Regulated activities. 404.8 Emergencies and law enforcement activities. 404.9 Armed Forces actions. 404.10 Commercial fishing. 404.11 Permitting procedures and criteria. 404.12 International law. Appendix A to Part 404—Map of the Monument Outer Boundary and Ecological Reserves, Special Preservation Areas, and Midway Atoll Special Management Area Appendix B to Part 404—Approved Vessel Monitoring Systems Authority: 16 U.S.C. 431 *et seq.* ; 16 U.S.C. 460k-3; 16 U.S.C. 1801 *et seq.* ; 16 U.S.C. 742f, 16 U.S.C. 742 *l* , and 16 U.S.C. 668dd- ee; 16 U.S.C. 1361 *et seq.* ; 16 U.S.C. 1531 *et seq.* , Pub. L. No. 106-513, § 6(g) (2000). § 404.1 Scope and purpose. The regulations in this part codify the provisions of Presidential Proclamation 8031, and govern the administration of the Northwestern Hawaiian Islands Marine National Monument. These regulations are jointly implemented by the Secretaries of the Interior, through the U.S. Fish and Wildlife Service (USFWS), and Commerce, through the National Oceanic and Atmospheric Administration (NOAA). Nothing in these regulations shall be deemed to diminish or enlarge the jurisdiction of the State of Hawaii. § 404.2 Boundary. The Northwestern Hawaiian Islands Marine National Monument consists of all lands and interest in lands owned or controlled by the Government of the United States within the boundaries of the Monument, including emergent and submerged lands and waters of the Northwestern Hawaiian Islands. The map in Appendix A to this part 404 depicts the outer boundary of the Monument, which consists of the geodetic lines connecting the coordinates specified in the Proclamation. § 404.3 Definitions. The following definitions are applicable only to this Part. *Attract or Attracting* means luring or attempting to lure a living resource by any means, except the mere presence of human beings (e.g., swimmers, divers, boaters). *Bottomfish Species* means Bottomfish management unit species as defined at 50 CFR 665.12. *Commercial Bottomfishing* means commercial fishing for bottomfish species. *Commercial passenger vessel* means a vessel that carries individuals who have paid for such carriage. *Commercial pelagic trolling* means commercial fishing for pelagic species. *Deserting* a vessel means:

(1)Leaving a vessel aground or adrift:

(i)Without notifying the Secretaries of the vessel going aground or adrift within 12 hours of its discovery and developing and presenting to the Secretaries a preliminary salvage plan within 24 hours of such notification;

(ii)After expressing or manifesting intention to not undertake or to cease salvage efforts; or

(iii)When the Secretaries are unable, after reasonable efforts, to reach the owner/operator within 12 hours of the vessel's condition being reported to authorities.

(2)Leaving a vessel at anchor when its condition creates potential for a grounding, discharge, or deposit and the owner/operator fails to secure the vessel in a timely manner. *Ecological Reserve* means the areas of the Monument, identified in the Proclamation, consisting of contiguous, diverse habitats that provide natural spawning, nursery, and permanent residence areas for the replenishment and genetic protection of marine life, and also to protect and preserve natural assemblages of habitats and species within areas representing a broad diversity of resources and habitats found within the Monument. Specific coordinates for Ecological Reserves within the Monument are found in the Proclamation, and the Ecological Reserves consist of the areas within the geodetic lines connecting these coordinates. The Ecological Reserves are depicted on the map in Appendix A to part 404. *Ecological integrity* means a condition determined to be characteristic of an ecosystem that has the ability to maintain the function, structure, and abundance of natural biological communities, including rates of change in response to natural environmental variation. *Fishing year* means the year beginning at 0001 local time on January 1 and ending at 2400 local time on December 31. *Introduced Species* means:

(1)A species (including, but not limited to, any of its biological matter capable of propagation) that is non-native to the ecosystem(s) protected by the Monument; or

(2)Any organism into which genetic matter from another species has been transferred in order that the host organism acquires the genetic traits of the transferred genes. *Landing* means offloading fish from a fishing vessel or causing fish to be offloaded from a fishing vessel. *Midway Atoll Special Management Area* means the area of the Monument surrounding Midway Atoll out to a distance of 12 nautical miles, established for the enhanced management, protection, and preservation of Monument wildlife and historical resources. The geographic coordinates of this area, which consists of the area within the geodetic lines connecting these coordinates, are found in the Proclamation. The Midway Atoll Special Management Area is depicted on the map in Appendix A to part 404. *Mobile transceiver unit* means a vessel monitoring system or VMS device, as described in Appendix E to this Part, installed on board a vessel that is used for vessel monitoring and transmitting the vessel's position as required by this Part. *Monument* means the Northwestern Hawaiian Islands Marine National Monument. *Native Hawaiian Practices* means cultural activities conducted for the purposes of perpetuating traditional knowledge, caring for and protecting the environment and strengthening cultural and spiritual connections to the Northwestern Hawaiian Islands that have demonstrable benefits to the Native Hawaiian community. This may include, but is not limited to, the non-commercial use of Monument resources for direct personal consumption while in the Monument. *Ocean-based ecotourism* means a class of fee-for-service activities that involves visiting the Monument for study, enjoyment, or volunteer assistance for purposes of conservation and management. *Office for Law Enforcement (OLE)* refers to NOAA, National Marine Fisheries Service, Office for Law Enforcement. *Pelagic Species* means Pacific Pelagic Management Unit Species as defined at 50 CFR 665.12. *Pono* means appropriate, correct, and deemed necessary by traditional standards in the Hawaiian culture. *Proclamation* means Presidential Proclamation 8031, dated June 15, 2006 (71 FR 36443). *Recreational activity* means an activity conducted for personal enjoyment that does not result in the extraction of Monument resources and that does not involve a fee-for-service transaction. This includes, but is not limited to, wildlife viewing, SCUBA diving, snorkeling, and boating. *Secretaries* means the Secretary of Commerce and the Secretary of the Interior or their designees. *Special Preservation Area (SPA)* means discrete, biologically important areas of the Monument, identified in the Proclamation, within which uses are subject to conditions, restrictions, and prohibitions, including but not limited to access restrictions. SPAs are used to avoid concentrations of uses that could result in declines in species populations or habitat, to reduce conflicts between uses, to protect areas that are critical for sustaining important marine species or habitats, or to provide opportunities for scientific research. Specific coordinates for Special Preservation Areas within the Monument are found in the Proclamation, and the Special Preservation Areas consist of the areas within the geodetic lines connecting these coordinates. The Special Preservation Areas are depicted on the map in Appendix A to part 404. *Special ocean use* means an activity or use of the Monument that is engaged in to generate revenue or profits for one or more of the persons associated with the activity or use, and does not destroy, cause the loss of, or injure Monument resources. This includes ocean-based ecotourism and other activities such as educational and research activities that are engaged in to generate revenue, but does not include commercial fishing for bottomfish or pelagic species conducted pursuant to a valid permit issued by NOAA. *Stowed and not available for immediate use* means not readily accessible for immediate use, *e.g.,* by being securely covered and lashed to a deck or bulkhead, tied down, unbaited, unloaded, or partially disassembled (such as spear shafts being kept separate from spear guns). *Sustenance fishing* means fishing for bottomfish or pelagic species in which all catch is consumed within the Monument, and that is incidental to an activity permitted under this part. *Vessel monitoring system or VMS* means a vessel monitoring system or mobile transceiver unit as described in § 404.5 and approved by Office for Law Enforcement for use on vessels permitted to access the Monument, as required by this Part. § 404.4 Access to the Monument.

(a)Entering the Monument is prohibited and thus unlawful except:

(1)As provided in §§ 404.8 and 404.9;

(2)Pursuant to a permit issued under §§ 404.10 or 404.11; or

(3)When conducting passage without interruption in accordance with paragraph

(b)of this section.

(b)Any person passing through the Monument without interruption is subject to the prohibitions in §§ 404.5, 404.6, and 404.7 and must provide notification prior to entering and after leaving the Monument. Notification of entry must be provided at least 72 hours, but no longer than 1 month, prior to the entry date. Notification of departure from the Monument must be provided within 12 hours of leaving. Notification under this paragraph may be made via e-mail, telephone or fax by contacting:

(1)E-mail: *nwhi.notifications@commat;noaa.gov;* or

(2)Telephone: 1-866-478-NWHI (6944); or

(808)395-NWHI (6944).

(c)A person providing notice under this paragraph must provide the following information, as applicable:

(1)Position when making report.

(2)Vessel name and International Maritime Organization identification number.

(3)Name, address, and telephone number of owner and operator.

(4)USCG documentation, state license, or registration number.

(5)Home port.

(6)Intended and actual route through the Monument.

(7)General categories of any hazardous cargo on board.

(8)Length of vessel and propulsion type (e.g., motor or sail). § 404.5 Requirements for a vessel monitoring system.

(a)*Requirement for use.* Effective August 28, 2006, an owner or operator of a vessel that has been issued a permit for accessing the Monument must ensure that such vessel has an OLE-approved, operating VMS on board when voyaging within the Monument. An operating VMS includes an operating mobile transmitting unit on the vessel and a functioning communication link between the unit and OLE as provided by an OLE-approved communication service provider. Appendix B to this part 404 provides information regarding OLE-approved transmitting units.

(b)*Installing and activating the VMS.* Only a VMS that has been approved by OLE may be used. When installing and activating the OLE-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 OLE, and follow instructions from that office. If notified by OLE 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 OLE the vessel's positions or returning to port until the VMS is operable.

(e)*Access to position data.* As a condition of authorized access to the Monument, a vessel owner or operator subject to the requirements for a VMS in this section must allow OLE, the USCG, and their authorized officers and designees access to the vessel's position data obtained from the VMS. Consistent with other applicable laws, including the limitations on access to, and use of, VMS data collected under the Magnuson-Stevens Fishery Conservation and Management Act, the Secretaries may have access to, and use of, collected data for scientific, statistical, and management purposes.

(f)*Authority for installation and operation.* OLE has authority over the installation and operation of the VMS unit. OLE may authorize the connection or order the disconnection of additional equipment, including a computer, to any VMS unit when deemed appropriate by OLE.

(g)*Activities Regarding Vessel Monitoring Systems.* Effective August 28, 2006, the following activities regarding vessel monitoring systems are prohibited and thus unlawful for any person to conduct or cause to be conducted:

(1)Operating any vessel within the Monument without an OLE type-approved mobile transceiver unit described in this section;

(2)Failing to install, activate, repair, or replace a mobile transceiver unit prior to leaving port;

(3)Failing to operate and maintain a mobile transceiver unit on board the vessel at all times as specified in this section;

(4)Tampering with, damaging, destroying, altering, or in any way distorting, rendering 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 section;

(5)Failing to contact OLE or follow OLE instructions when automatic position reporting has been interrupted as specified in this section;

(6)Registering a VMS or mobile transceiver unit to more than one vessel at the same time;

(7)Connecting or leaving connected additional equipment to a VMS unit or mobile transceiver unit without the prior approval of OLE; and

(8)Making a false statement, oral or written, to an authorized officer regarding the installation, use, operation, or maintenance of a VMS unit or mobile transceiver unit or communication service provider. § 404.6 Prohibited activities. The following activities are prohibited and thus unlawful for any person to conduct or cause to be conducted:

(a)Exploring for, developing, or producing oil, gas, or minerals within the Monument;

(b)Using or attempting to use poisons, electrical charges, or explosives in the collection or harvest of a Monument resource;

(c)Introducing or otherwise releasing an introduced species from within or into the Monument; and

(d)Anchoring on or having a vessel anchored on any living or dead coral with an anchor, anchor chain, or anchor rope. § 404.7 Regulated activities. Except as provided in §§ 404.8, 404.9 and 404.10, the following activities are prohibited and thus unlawful for any person to conduct or cause to be conducted within the Monument without a valid permit as provided for in § 404.11:

(a)Removing, moving, taking, harvesting, possessing, injuring, disturbing, or damaging; or attempting to remove, move, take, harvest, possess, injure, disturb, or damage any living or nonliving Monument resource;

(b)Drilling into, dredging, or otherwise altering the submerged lands other than by anchoring a vessel; or constructing, placing, or abandoning any structure, material, or other matter on the submerged lands;

(c)Anchoring a vessel;

(d)Deserting a vessel aground, at anchor, or adrift;

(e)Discharging or depositing any material or other matter into Special Preservation Areas or the Midway Atoll Special Management Area except vessel engine cooling water, weather deck runoff, and vessel engine exhaust;

(f)Discharging or depositing any material or other matter into the Monument, or discharging or depositing any material or other matter outside the Monument that subsequently enters the Monument and injures any resources of the Monument, except fish parts (i.e., chumming material or bait) used in and during authorized fishing operations, or discharges incidental to vessel use such as deck wash, approved marine sanitation device effluent, cooling water, and engine exhaust;

(g)Touching coral, living or dead;

(h)Possessing fishing gear except when stowed and not available for immediate use during passage without interruption through the Monument;

(i)Swimming, snorkeling, or closed or open circuit SCUBA diving within any Special Preservation Area or the Midway Atoll Special Management Area; and

(j)Attracting any living Monument resource. § 404.8 Emergencies and law enforcement activities. The prohibitions in this part do not apply to activities necessary to respond to emergencies threatening life, property, or the environment, or to activities necessary for law enforcement purposes. § 404.9 Armed Forces actions.

(a)The prohibitions in this part do not apply to activities and exercises of the Armed Forces (including those carried out by the United States Coast Guard) that are consistent with applicable laws.

(b)These regulations shall not limit agency actions to respond to emergencies posing an unacceptable threat to human health or safety or to the marine environment and admitting of no other feasible solution.

(c)All activities and exercises of the Armed Forces shall be carried out in a manner that avoids, to the extent practicable and consistent with operational requirements, adverse impacts on Monument resources and qualities.

(d)In the event of threatened or actual destruction of, loss of, or injury to a Monument resource or quality resulting from an incident, including but not limited to spills and groundings, caused by a component of the Department of Defense or the United States Coast Guard, the cognizant component shall promptly coordinate with the Secretaries for the purpose of taking appropriate actions to respond to and mitigate the harm and, if possible, restore or replace the Monument resource or quality. § 404.10 Commercial fishing.

(a)*Lobster fishing.* Any commercial lobster fishing permit is subject to a zero annual harvest limit condition.

(b)*Fishing and bottomfish and pelagic species.*

(1)Notwithstanding the prohibitions in § 404.7(a) and (h), commercial fishing for bottomfish and associated pelagic species may continue within the Monument subject to paragraph

(c)of this section, until June 15, 2011, provided that:

(i)The fishing is conducted in accordance with a valid commercial bottomfish permit issued by NOAA; and

(ii)Such permit was in effect on June 15, 2006, and is subsequently renewed pursuant to NOAA regulations at 50 CFR part 665, subpart E as necessary.

(2)Total landings for each fishing year from fishing allowed under paragraph (b)(1) of this section may not exceed the following amounts:

(i)350,000 pounds for bottomfish species; and

(ii)180,000 pounds for pelagic species.

(3)Commercial fishing for bottomfish and associated pelagic species is prohibited in the Monument after June 15, 2011.

(c)*General requirements.* Any commercial fishing within the Monument shall be conducted in accordance with the following restrictions and conditions:

(1)A valid permit or facsimile of a valid permit shall be on board the fishing vessel and available for inspection by an authorized officer;

(2)No attempt is made to falsify or fail to make, keep, maintain, or submit any logbook or logbook form or other required record or report.

(3)Only gear specifically authorized by the relevant permit issued under the Magnuson-Stevens Fishery Conservation and Management Act is allowed to be in the possession of a person conducting commercial fishing under this section;

(4)Any person conducting commercial fishing notifies the Secretaries by telephone, facsimile, or electronic mail at least 72 hours before entering the Monument and within 12 hours after leaving the Monument in accordance with § 404.4(b) and (c);

(5)All fishing vessels must carry an activated and functioning VMS unit on board at all times whenever the vessel is in the Monument;

(6)All fishing vessels must carry an observer when requested to do so by the Secretaries;

(7)The activity does not take place within any Ecological Reserve, any Special Preservation Area, or the Midway Atoll Special Management Area. § 404.11 Permitting procedures and criteria.

(a)*Issuance.* Subject to such terms and conditions as the Secretaries deem appropriate, a person may conduct an activity prohibited by § 404.7 if such activity is specifically authorized by a permit issued under this section.

(b)*Application requirements.* Applicants for permits under this section shall submit applications to: Northwestern Hawaiian Islands Marine National Monument, 6600 Kalanianaole Highway, Suite 300, Honolulu, HI 96825.

(c)*Permit Types.* A permit under this subpart may be issued if the Secretaries find that the activity:

(1)Is research designed to further understanding of Monument resources and qualities;

(2)Will further the educational value of the Monument;

(3)Will assist in the conservation and management of the Monument;

(4)Will allow Native Hawaiian practices subject to paragraph

(e)of this section;

(5)Will allow a special ocean use subject to paragraph

(f)of this section; or

(6)Will allow recreational activities subject to paragraph

(g)of this section.

(d)*Findings.* A permit may not be issued under this section unless the Secretaries find:

(1)The activity can be conducted with adequate safeguards for the resources and ecological integrity of the Monument;

(2)The activity will be conducted in a manner compatible with the purposes of the Proclamation, considering the extent to which the conduct of the activity may diminish or enhance Monument resources, qualities, and ecological integrity, any indirect, secondary or cumulative effects of the activity, and the duration of such effects;

(3)There is no practicable alternative to conducting the activity within the Monument;

(4)The end value of the activity outweighs its adverse impacts on Monument resources, qualities, and ecological integrity;

(5)The duration of the activity is no longer than necessary to achieve its stated purpose;

(6)The applicant is qualified to conduct and complete the activity and mitigate any potential impacts resulting from its conduct;

(7)The applicant has adequate financial resources available to conduct and complete the activity and mitigate any potential impacts resulting from its conduct;

(8)The methods and procedures proposed by the applicant are appropriate to achieve the proposed activity's goals in relation to their impacts to Monument resources, qualities, and ecological integrity;

(9)The applicant's vessel has been outfitted with a mobile transceiver unit approved by OLE and complies with the requirements of § 404.5; and

(10)There are no other factors that would make the issuance of a permit for the activity inappropriate.

(e)*Additional findings for Native Hawaiian practice permits.* In addition to the findings listed in paragraph

(d)of this section, a permit to allow Native Hawaiian practices under paragraph (c)(4) of this section, may not be issued unless:

(1)The activity is non-commercial and will not involve the sale of any organism or material collected;

(2)The purpose and intent of the activity are appropriate and deemed necessary by traditional standards in the Native Hawaiian culture ( *pono* ), and demonstrate an understanding of, and background in, the traditional practice, and its associated values and protocols;

(3)The activity benefits the resources of the Northwestern Hawaiian Islands and the Native Hawaiian community;

(4)The activity supports or advances the perpetuation of traditional knowledge and ancestral connections of Native Hawaiians to the Northwestern Hawaiian Islands; and

(5)Any Monument resource harvested from the Monument will be consumed in the Monument.

(f)*Additional findings, criteria, and requirements for special ocean use permits.*

(1)In addition to the findings listed in paragraph

(d)of this section, the following requirements apply to the issuance of a permit for a special ocean use under paragraph (c)(5) of this section:

(i)Any permit for a special ocean use issued under this section:

(ii)Shall authorize the conduct of an activity only if that activity is compatible with the purposes for which the Monument is designated and with protection of Monument resources;

(A)Shall not authorize the conduct of any activity for a period of more than 5 years unless renewed;

(B)Shall require that activities carried out under the permit be conducted in a manner that does not destroy, cause the loss of, or injure Monument resources; and

(iii)Shall require the permittee to purchase and maintain comprehensive general liability insurance, or post an equivalent bond, against claims arising out of activities conducted under the permit and to agree to hold the United States harmless against such claims;

(iv)Each person issued a permit for a special ocean use under this section shall submit an annual report to the Secretaries not later than December 31 of each year which describes activities conducted under that permit and revenues derived from such activities during the year.

(2)In addition to the findings listed in paragraph

(d)of this section, a permit may not be issued for a special ocean use unless the activity has been determined to be consistent with the findings made pursuant to paragraph

(f)of this section.

(3)Categories of special ocean use being permitted for the first time under this section will be restricted in duration and permitted as a special ocean use pilot project. Subsequent permits for any category of special ocean use may only be issued if a special ocean use pilot project for that category meets the requirements of this section, and any terms and conditions placed on the permit for the pilot project.

(4)Public notice shall be provided prior to requiring a special ocean use permit for any category of activity not previously identified as a special ocean use.

(5)The following requirements apply to permits for a special ocean use for an activity within the Midway Atoll Special Management Area.

(i)A permit for a special ocean use for activities within the Midway Atoll Special Management Area may be issued provided:

(A)The activity furthers the conservation and management of the Monument; and

(B)The Director of the United States Fish and Wildlife Service or his or her designee has determined that the activity is compatible with the purposes for which the Midway Atoll National Wildlife Refuge was designated.

(ii)As part of a permit issued pursuant to this paragraph (f)(5), vessels may be allowed to transit the Monument as necessary to enter the Midway Atoll Special Management Area.

(6)A permit for a special ocean use for activities outside the Midway Atoll Special Management Area may be issued provided:

(i)The activity will directly benefit the conservation and management of the Monument;

(ii)The purpose of the activity is for research or education related to the resources or qualities of the Monument;

(iii)Public notice of the application and an opportunity to provide comments is given at least 30 days prior to issuing the permit; and

(iv)The activity does not involve the use of a commercial passenger vessel.

(g)*Additional findings for recreation permits.* A permit for recreational activities under paragraph (c)(6) of this section may be issued for activities to be conducted within the Midway Atoll Special Management area if, in addition to the findings listed in paragraph

(d)of this section:

(1)The activity is for the purpose of recreation as defined in section 404.3;

(2)The activity is not associated with any for-hire operation; and

(3)The activity does not involve any extractive use.

(h)*Sustenance fishing.* Sustenance fishing, as defined in 404.3, may be allowed outside of any Special Preservation Area as a term or condition of any permit issued under this part. Sustenance fishing in the Midway Atoll Special Management Area shall not be allowed unless the activity has been determined by the Director of the U.S. Fish and Wildlife Service or his or her designee to be compatible with the purposes for which the Midway Atoll National Wildlife Refuge was established. Sustenance fishing must be conducted in a manner compatible with the Proclamation and this part, including considering the extent to which the conduct of the activity may diminish Monument resources, qualities, and ecological integrity, as well as any indirect, secondary, or cumulative effects of the activity and the duration of such effects. Sustenance fishing is subject to systematic reporting requirements when developed by the Secretaries. § 404.12 International law. These regulations shall be applied in accordance with international law. No restrictions shall apply to or be enforced against a person who is not a citizen, national, or resident alien of the United States (including foreign flag vessels) unless in accordance with international law. Appendix A to Part 404—Map of the Monument Outer Boundary and Ecological Reserves, Special Preservation Areas, and Midway Atoll Special Management Area BILLING CODE 3510-NK-P ER29AU06.000 BILLING CODE 3510-NK-C Appendix B to Part 404—Approved VMS I. VMS Mobile Transceiver Unit Thrane & Thrane Sailor 3026D Gold VMS The Thrane & Thrane Sailor 3026D Gold VMS (TT-3026D) has been found to meet the minimum technical requirements for vessels issued permits to operate in the Northwestern Hawaiian Islands Marine National Monument. The address for the Thrane & Thrane distributor contact is provided in this notice under the heading VMS Provider Address. The TT-3026D Gold VMS features an integrated GPS/Inmarsat-C unit and a marine grade monitor with keyboard and integrated mouse. The unit is factory pre-configured for NMFS VMS operations (non-Global Maritime Distress & Safety System (non-GMDSS)). Satellite commissioning services are provided by Thrane & Thrane personnel. Automatic GPS position reporting starts after transceiver installation and power activation onboard the vessel. The unit is an integrated transceiver/antenna/GPS design using a floating 10 to 32 VDC power supply. The unit is configured for automatic reduced position transmissions when the vessel is stationary (i.e., in port). It allows for port stays without power drain or power shut down. The unit restarts normal position transmission automatically when the vessel goes to sea. The TT-3026D provides operation down to +/−15 degree angles. The unit has the capability of two-way communications to send formatted forms and to receive e-mail and other messages. A configuration option is available to automatically send position reports to a private address, such as a fleet management company. A vessel owner may purchase this system by contacting the entity identified in this notice under the heading ``VMS Provider Address''. The owner should identify himself or herself as a vessel owner issued a permit to operate in the Northwestern Hawaiian Islands Marine National Monument, so the transceiver set can be properly configured. To use the TT-3026D the vessel owner will need to establish an Inmarsat-C system use contract with an approved Inmarsat-C communications service provider. The owner will be required to complete the Inmarsat-C ``Registration for Service Activation for Maritime Mobile Earth Station.'' The owner should consult with Thrane & Thrane when completing this form. Thrane & Thrane personnel will perform the following services before shipment:

(1)Configure the transceiver according to OLE specifications for vessels issued permits to operate in the Northwestern Hawaiian Islands Marine National Monument;

(2)download the predetermined NMFS position reporting and broadcast command identification numbers into the unit;

(3)test the unit to ensure operation when installation has been completed on the vessel; and

(4)forward the Inmarsat service provider and the transceiver identifying information to OLE. II. Inmarsat-C Communications Providers It is recommended, for vendor warranty and customer service purposes, that the vessel owner keep for his or her records and that Telenor and Xantic have on record the following identifying information:

(1)Signed and dated receipts and contracts;

(2)transceiver serial number;

(3)Telenor or Xantic customer number, user name and password;

(4)e-mail address of transceiver;

(5)Inmarsat identification number;

(6)owner name;

(7)vessel name;

(8)vessel documentation or registration number; and

(9)mobile earth station license (FCC license). The OLE will provide an installation and activation checklist that the vessel owner must follow. The vessel owner must sign a statement on the checklist certifying compliance with the installation procedures and return the checklist to OLE. Installation can be performed by an experienced crew or by an electronics specialist, and the installation cost is paid by the owner. The owner may confirm the TT-3026D operation and communications service to ensure that position reports are automatically sent to and received by OLE before leaving on a trip under VMS. The OLE does not regard the vessel as meeting requirements until position reports are automatically received. For confirmation purposes, contact the NOAA Fisheries Office for Law Enforcement, 8484 Georgia Ave., Suite 415, Silver Spring, MD 20910, phone 888-219-9228, fax 301-427-0049. Telenor Satellite Services Inmarsat-C is a store-and-forward data messaging service. Inmarsat-C allows users to send and receive information virtually anywhere in the world, on land, at sea, and in the air. Inmarsat-C supports a wide variety of applications including Internet, e-mail, position and weather reporting, a free daily news service, and remote equipment monitoring and control. Mariners can use Inmarsat-C free of charge to send critical safety at sea messages as part of the U.S. Coast Guard's Automated Mutual-Assistance Vessel Rescue system and of the NOAA Shipboard Environmental Acquisition System programs. Telenor Vessel Monitoring System Services is being sold through Thrane & Thrane, Inc. For the Thrane & Thrane and Telenor addresses, look inside this notice under the heading ``VMS Provider Address''. Xantic Xantic is a provider of Vessel Monitoring Services to the maritime industry. By installing an approved OLE Inmarsat-C transceiver on the vessel, vessels can send and receive e-mail, to and from land, while the transceiver automatically sends vessel position reports to OLE, and is fully compliant with the International Coast Guard Search and Rescue Centers. Xantic Vessel Monitoring System Services are being sold through Thrane & Thrane, Inc. For the Thrane & Thrane and Xantic addresses, look in this notice under the heading ``VMS Provider Address''. For Telenor and Xantic, Thrane & Thrane customer service supports the security and privacy of vessel accounts and messages with the following:

(a)Password authentication for vessel owners or agents and for OLE to prevent unauthorized changes or inquiries; and

(b)separation of private messages from OLE messages. (OLE requires VMS-related position reports, only.) Billing is separated between accounts for the vessel owner and the OLE. VMS position reports and vessel-initiated messaging are paid for by the vessel owner. Messaging initiated from OLE operations center is paid for by NOAA. Thrane & Thrane provides customer service for Telenor and Xantic users to support and establish two-way transmission of transceiver unit configuration commands between the transceiver and land-based control centers. This supports OLE's message needs and, optionally, the crew's private message needs. The vessel owner can configure automatic position reports to be sent to a private address, such as to a fleet management company. Vessel owners wishing to use Telenor or Xantic services will need to purchase an Inmarsat-C transceiver approved for vessels issued permits to operate in the Northwestern Hawaiian Islands Marine National Monument. The owner will need to complete an Inmarsat-C system use contract with Telenor or Xantic, including a mobile earth station license (FCC requirement). The transceiver will need to be commissioned with Inmarsat according to Telenor or Xantic's instructions. The owner should refer to and follow the configuration, installation, and service activation procedures for the specific transceiver purchased. III. VMS Provider Address For TT-3026D, Telenor, or Xantic information, contact Ronald Lockerby, Marine Products, Thrane & Thrane, Inc., 509 Viking Drive, Suite K, L & M, Virginia Beach, VA 23452; voice: 757-463-9557; fax: 757-463-9581, e-mail: *rdl@tt.dk.com* ; Web site: *http://www.landseasystems.com* . [FR Doc. 06-7235 Filed 8-25-06; 12:24 pm]

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