Notices. Proposed rule

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BILLING CODE 4910-62-P SECURITIES AND EXCHANGE COMMISSION 17 CFR Part 240 [Release No. 34-54863; File No. S7-19-06] RIN 3235-AJ41 Proposed Amendments to Municipal Securities Disclosure AGENCY: Securities and Exchange Commission (“Commission”). ACTION: Proposed rule. SUMMARY: The Commission is publishing for comment proposed amendments to a rule under the Securities Exchange Act of 1934 (“Exchange Act”) relating to municipal securities disclosure which would delete references to the Municipal Securities Rulemaking Board (“MSRB”) as a recipient of material event notices filed by or on behalf of issuers of municipal securities or other obligated persons.

DATES: Comments should be received on or before January 8, 2007. ADDRESSES: Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission's Internet comment form ( *http://www.sec.gov/rules/proposed.shtml* ); or • Send an e-mail to *rule-comments@sec.gov.* Please include File No. S7-19-06 on the subject line; or • Use the Federal eRulemaking Portal ( *http://www.regulations.gov* ). Follow the instructions for submitting comments. Paper Comments • Send paper comments in triplicate to Nancy M.

Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090. All submissions should refer to File No. S7-19-06. This file number should be included on the subject line if e-mail is used. To help us process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site ( *http://www.sec.gov/rules/proposed.shtml* ). Comments are also available for public inspection and copying in the Commission's Public Reference Room, 100 F Street, NE., Washington, DC 20549.

All comments received will be posted without change; we do not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. FOR FURTHER INFORMATION CONTACT: Martha Mahan Haines, Chief, Office of Municipal Securities, at

(202)551-5681; Mary N. Simpkins, Senior Special Counsel, at

(202)551-5683; or David Liu, Special Counsel, at

(202)551-5645, Division of Market Regulation, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549-6628. SUPPLEMENTARY INFORMATION: The Commission is requesting public comment on proposed amendments to Rule 15c2-12 [17 CFR 240.15c2-12] under the Exchange Act. Table of Contents I. Background A. 1994 Amendments to Rule 15c2-12 B. CDI System and CDINet II. MSRB Petition III. Discussion IV. Request for Comment V. Paperwork Reduction Act VI. Costs and Benefits of Proposed Amendments to Rule 15c2-12 A. Benefits B. Costs VII. Consideration of Burden and Promotion of Efficiency, Competition, and Capital Formation VIII. Consideration of Impact on the Economy IX. Regulatory Flexibility Act Certification X. Statutory Authority I. Background A. 1994 Amendments to Rule 15c2-12 On November 10, 1994, the Commission adopted amendments (“1994 Amendments”) to Rule 15c2-12 (“Rule”) under the Exchange Act 1 to provide, among other things, enhanced ongoing disclosure to the market for municipal securities. 2 Pursuant to subsection (b)(5)(i) of the Rule, 3 the Commission requires brokers, dealers, and municipal securities dealers (“Participating Underwriters”), prior to underwriting a primary offering of municipal securities of $1,000,000 or more, to reasonably determine that the issuer or obligated person for whom financial or operating data is presented in the final official statement (“Issuer”), has undertaken, in a written agreement or contract for the benefit of bondholders, to provide certain continuing disclosure information. Among other things, the Issuer must undertake to send to each nationally recognized municipal securities information repository (“NRMSIR”) or the MSRB, and to the appropriate state information depository (“SID”), if any, certain material event notices designated in subsection (b)(5)(i)(C) of the Rule. 4 In addition, subsection (b)(5)(i)(D) of the Rule requires a Participating Underwriter to reasonably determine that the Issuer has agreed to notify those same repositories if it fails to provide annual financial information by the agreed-upon date. 5 1 17 CFR 240.15c2-12. 2 Securities Exchange Act Release No. 34961 (November 10, 1994), 59 FR 59590 (November 17, 1994) (“1994 Adopting Release”). 3 17 CFR 240.15c2-12(b)(5)(i). 4 17 CFR 240.15c2-12(b)(5)(i)(C). Subsection (b)(5)(i)(C) lists the following events which, if material, require notice:

(1)Principal and interest payment delinquencies;

(2)non-payment related defaults;

(3)unscheduled draws on debt service reserves reflecting financial difficulties;

(4)unscheduled draws on credit enhancements reflecting financial difficulties;

(5)substitution of credit or liquidity providers, or their failure to perform;

(6)adverse tax opinions or events affecting the tax-exempt status of the security;

(7)modifications to rights of security holders;

(8)bond calls;

(9)defeasances;

(10)release, substitution, or sale of property securing repayment of the securities; and

(11)rating changes. In addition, in Rule 15c2-12(d)(2), the small issuer exemption is conditioned on an issuer or obligated person undertaking a limited disclosure obligation, including sending certain material event notices to each NRMSIR or the MSRB, as well as the appropriate SID. 17 CFR 240.15c2-12(d)(2). 5 17 CFR 240.15c2-12(b)(5)(i)(D). The Commission included the MSRB in its plan for dissemination of material event notices set forth in the Rule because, at the time of the 1994 Amendments, the MSRB already had a voluntary disclosure system in place for receiving and disseminating certain types of material event notices. 6 As the Commission noted in the 1994 Adopting Release, “permitting issuers and obligated persons to file such notices either with each NRMSIR or with the MSRB (as well as the appropriate SID) will facilitate prompt and wide disclosure.” 7 In adopting the 1994 Amendments, the Commission also stated that inclusion of the MSRB as a filing option reflected the preference expressed by some commenters to file the required notices in one central place, rather than having to file with multiple NRMSIRs. 8 Under the Rule, the use of the MSRB filing alternative is optional, as the material event notice obligation can be satisfied by sending notice to each of the NRMSIRs rather than to the MSRB. 6 *See* Securities Exchange Act Release No. 30556 (April 6, 1992), 57 FR 12534 (April 10, 1992) (“CDI System Approval Order”). *See also* Securities Exchange Act Release No. 33742 (March 9, 1994), 59 FR 12759 (March 17, 1994) (“1994 Proposing Release”) at 12764, note 25. 7 *See* 1994 Adopting Release at 59605. 8 *See* 1994 Adopting Release at 59605. B. CDI System and CDINet The MSRB's original system for receiving material event notices, the Continuing Disclosure Information (“CDI”) System, was approved by the Commission in April 1992 and commenced operation in January 1993. 9 On March 24, 1997, the MSRB implemented certain improvements to its dissemination process and replaced its earlier CDI System with CDINet. CDINet was approved by the Commission in December 1996 10 and, among other things, is designed to accept and disseminate material event notices submitted as a result of the Rule. Once a document has been accepted and processed by CDINet, it is broadcast to subscribers 11 and made available in the MSRB's public access facility. 12 9 CDI System Approval Order. 10 Securities Exchange Act Release No. 38066 (December 19, 1996), 61 FR 68322 (December 27, 1996) (“CDINet Approval Order”). 11 The MSRB has represented to the Commission that CDINet has only two subscribers. *See infra* notes 18 and 19. 12 The MSRB has represented to the Commission that, as of September 2005, no one has requested CDINet information at the MSRB's public access facility for at least the last five years. II. MSRB Petition In a recent letter to the Commission, 13 the MSRB petitioned the Commission to remove the MSRB as a recipient of material event notices under the Rule. 14 According to the MSRB petition, CDINet was designed to permit Issuers to satisfy their material event undertakings through a single submission to the MSRB, rather than through separate filings to each of the NRMSIRs. However, the MSRB states that relatively few Issuers have opted to use CDINet and, in recent years, usage of CDINet has diminished. According to the MSRB, in 1997, CDINet received over 10,000 material event notices. Since that time, submissions to the MSRB have dropped considerably, ranging from 1,000 to 2,500 annually. 15 13 Letter from Diane G. Klinke, General Counsel, MSRB, to Jonathan G. Katz, Secretary, Commission, dated September 8, 2005 (“MSRB Petition”). 14 17 CFR 240.15c2-12. 15 MSRB Petition at 2. A review conducted by the MSRB of the material event notices received by CDINet in the first half of 2004 showed that, of the 1,104 notices received in that time period, 504 were bond calls, 213 were defeasances, and 145 were rating changes. 16 The MSRB also recently reviewed a sample of 100 material event notices received by CDINet in June 2005. 17 The MSRB believes that most of the material event notices received by CDINet also are provided to, or otherwise obtained by, the NRMSIRs. 18 In its petition, the MSRB also expressed concern that the notices filed exclusively with the MSRB may not be reaching the broader market as intended by the Rule because not all NRMSIRs subscribe to CDINet and the information may not otherwise be widely distributed. 19 16 The remaining notices included the following categories: Failure to File Annual Report (70 notices); Information not specifically required under SEC Rule 15c2-12 (70); Bond Calls and Defeasances (56); Annual Report and CAFR Related Information (13); Various multiple categories indicated (10); Release, Substitution, or Sale of Property Securing Repayment of Securities (5); Principal and Interest Payment Delinquencies (4); Substitution of Credit or Liquidity Providers, or Their Failure to Perform (4); Non-Payment Related Defaults (3); Adverse Tax Opinions or Events Affecting the Tax-Exempt Status of the Security (3); Unscheduled Draws on Debt Service Reserves Reflecting Financial Difficulties (2); Unscheduled Draws Credit Enhancements Reflecting Financial Difficulties (1); and Modifications to the Rights of Security Holders (1). *See* Attachment to MSRB Petition. 17 MSRB Petition at 2-3. 18 Definitive information on 90 of the June 2005 notices was found by the MSRB in a review of information available from NRMSIRs that do not subscribe to CDINet. CDINet only has two NRMSIR subscribers: Kenny S&P and Thomson Financial Services. MSRB Petition at 2, note 7. The MSRB presumed that the remaining ten notices were not provided directly to all the NRMSIRs. These notices included six notices regarding failure to provide an annual financial statement, two bond calls, one rating change and one relating to “other information.” The MSRB believes that there is some evidence, however, that at least one NRMSIR may have received some of the notices of failure to provide an annual financial statement but subsequently superseded such information with the annual financial statements themselves once these were received. MSRB Petition at 3, note 8. 19 MSRB Petition at 3. In addition, the MSRB believes that the need for CDINet has also been lessened because an alternative document delivery system has become available to Issuers and dissemination agents who prefer to send their filings to a single location for delivery to all of the NRMSIRs and any appropriate SID. 20 In its petition to the Commission, the MSRB stated that it believes that the number of documents submitted to CDINet will further decrease and that the continued operation of CDINet would provide minimal continuing benefit to the marketplace. 21 Finally, because of the age of the CDINet system, the MSRB states that upgrades at an estimated cost of $500,000 to $1 million would be necessary to keep the system operational. 22 20 The Commission understands that there may be other entities that have developed or are developing services related to Rule 15c2-12. 21 MSRB Petition at 3. 22 MSRB Petition at 3. III. Discussion The Commission proposes to amend Rule 15c2-12 23 to delete references to the MSRB as an alternative recipient of material event notices filed by Issuers. Under the proposal, Issuers and their dissemination agents instead would undertake to send material event notices to each NRMSIR and the appropriate SID, if any. The Commission believes that, given the limited usage of the MSRB's CDINet system and the MSRB's petition for rulemaking, the proposed elimination of the option of filing material event notices with the MSRB is warranted. The relatively small number of filings made with CDINet indicates that there is little demand for the MSRB filing option. The Commission believes that requiring Issuers to send their material event notices only to each of the NRMSIRs and any appropriate SIDs would simplify the Rule and compliance by Issuers with their undertakings, because Issuers would be required to file material event notices at the same locations that annual financial information is required to be filed pursuant to undertakings in accordance with subsection (b)(5)(i)(A) of the Rule. 24 In addition, the Commission believes that eliminating the MSRB filing option would better assure that material event notices are widely disseminated to the market, since it appears that CDINet data may not be broadly distributed. 25 Requiring that each NRMSIR and the appropriate SID, if any, receives all material event notices should help assure the completeness and consistency of information available from those repositories. 23 17 CFR 240.15c2-12. 24 17 CFR 240.15c2-12(b)(5)(i)(A). 25 As the MSRB's recent review showed, a portion of the notices received by the MSRB may not have been fully disseminated to the wider market, since there are only two subscribers to the MSRB's CDINet. *See supra* notes 18 and 19. Finally, the Commission notes the MSRB's statement that the upgrading of CDINet required to maintain the system would cost approximately $500,000 to $1 million. 26 In light of the current alternative options under Rule 15c2-12 for Issuers to file with NRMSIRs and SIDs and the lack of demand for the MSRB filing alternative—both by Issuers and information users—the Commission believes that the MSRB's proposal to cease CDINet's operations is reasonable. The Commission notes that the MSRB has committed to forward material event notices to the NRMSIRs and applicable SIDs for a period of one year from the date CDINet ceases operations. 27 The MSRB has also agreed to alert senders of such notices of the fact that CDINet is ceasing operations, and ask that such senders comply with their undertakings by sending future material event notices to the NRMSIRs and applicable SIDs. 26 MSRB Petition at 3. 27 MSRB Petition at 4; Letter from Diane G. Klinke, General Counsel, MSRB, to Martha Mahan Haines, Chief, Office of Municipal Securities, Commission, dated April 20, 2006. IV. Request for Comment The Commission seeks comment on the proposed amendments to the Rule. Specifically, comment is requested on whether, in light of the alternative filing options available to Issuers and dissemination agents, there is still a need for the MSRB to be a recipient of material event notices. The Commission also requests comment on whether there exist any applicable continuing disclosure agreements which require issuers or other obligated persons to file material event notices solely with the MSRB that might require modification were the Commission to amend the Rule as proposed. It is the staff's understanding that such agreements often contain a requirement to file notices with both the

(1)NRMSIRs and applicable SIDs and

(2)MSRB. The Commission seeks comment on whether any such agreements require filings solely with the MSRB. In addition, the Commission seeks comment on whether the proposed amendment would in fact simplify compliance with undertakings in accordance with the Rule, and better assure widespread dissemination of material event notices. V. Paperwork Reduction Act The proposed amendment to the Rule, contains no new “collection of information” requirements within the meaning of the Paperwork Reduction Act of 1995 (“PRA”). 28 The title of the current information collection as required and under the Rule is Municipal Securities Disclosure (17 CFR 240.15c2-12) (OMB Control No. 3235-0372). 28 44 U.S.C. 3501 *et seq.* VI. Costs and Benefits of Proposed Amendments to Rule 15c2-12 The Rule currently requires Participating Underwriters to reasonably determine that Issuers have undertaken to submit material event notices to

(1)each NRMSIR or the MSRB and

(2)the appropriate SID, if any. The proposed amendments would remove the MSRB as an option for the filing of such notices, thereby requiring submission, pursuant to the undertakings, to each NRMSIR and the appropriate SID, if any. A. Benefits The Commission preliminarily believes that the proposed amendments to the Rule should improve the disclosure of material event information to the municipal securities marketplace. Because the MSRB's CDINet system currently only has two subscribers, it is not clear that all material event notices submitted to the MSRB are fully distributed to the marketplace. Requiring that each NRMSIR and the appropriate SID, if any, receives all material event notices should help assure the completeness and consistency of information available from those repositories. The Commission also preliminarily believes that the elimination of the MSRB as a filing option would simplify compliance by Issuers with their undertakings in accordance with the Rule. If the proposed amendments are adopted, Issuers would be required to file, pursuant to their undertakings, material event notices at the same locations—each NRMSIR and the appropriate SID, if any—that annual financial information is required to be filed. Finally, the Commission preliminarily concludes that the proposed amendments could save the MSRB substantial funds, represented by the MSRB to be approximately $500,000 to $1 million, 29 by not requiring it to perform certain upgrades to its CDINet system which would otherwise be required in order for the system to be maintained. As the costs of the MSRB are paid primarily from fees paid by brokers, dealers and municipal securities dealers, those parties and their customers would benefit from this savings. 29 MSRB Petition at 3. B. Costs The Commission preliminarily believes that the proposed amendments to the Rule should only minimally increase compliance costs for a few Issuers and may decrease overall compliance costs. Because some Issuers may currently be sending their material event notices only to the MSRB, the proposed amendments would require them to send such notices to each of the (currently four) NRMSIRs. However, the Commission believes that the cost of sending such notices to three additional locales would be minimal because such notices are generally short in length and would only encompass the additional costs of copying several pages, as well as the minor additional mailing costs. In addition, the MSRB has indicated that there is an alternative free document delivery system available to Issuers and dissemination agents who prefer to send their filings to a single location for delivery to all of the NRMSIRS and appropriate SIDs. 30 We request comment on whether this would result in any increased costs to issuers. Finally, the Commission preliminarily believes that those Issuers that currently send to their material event notices to each NRMSIR as well as the MSRB would reduce their costs because the proposed amendments would require those Issuers to send their material event notices to one fewer location. 30 The Commission understands that there may be other entities that have developed or are developing services related to Rule 15c2-12. To assist the Commission in evaluating the costs and benefits that may result from the proposed amendments to the Rule, the Commission requests comments on the potential costs and benefits identified in the release, as well as any other costs or benefits that may result from the proposed amendments to the Rule. In addition, the commenters should provide analysis and data to support their views on the costs and benefits. VII. Consideration of Burden and Promotion of Efficiency, Competition, and Capital Formation Section 3(f) of the Exchange Act 31 requires the Commission, whenever it engages in rulemaking and is required to consider or determine whether an action is necessary or appropriate in the public interest, to consider whether the action would promote efficiency, competition, and capital formation. In addition, Section 23(a)(2) of the Exchange Act 32 requires the Commission, when making rules under the Exchange Act, to consider the impact of such rules on competition. Section 23(a)(2) also prohibits the Commission from adopting any rule that would impose a burden on competition not necessary or appropriate in furtherance of the purposes of the Exchange Act. 31 15 U.S.C. 78c(f). 32 15 U.S.C. 78w(a)(2). The Commission preliminarily believes that the proposed amendments to the Rule would not impose any burdens on efficiency, capital formation, and competition not necessary or appropriate in furtherance of the purposes of the Exchange Act. The proposed amendments are expected to simplify the material event notice delivery requirements for Issuers, in accordance with their undertakings, by eliminating the MSRB as an alternative. In doing so, the Commission preliminarily believes that municipal securities disclosure would be enhanced, as all Issuers would be required to send all NRMSIRs (and appropriate SIDs) such notices. Under the current disclosure system, Issuers may choose to send such notices to the MSRB. However, there is some evidence 33 that some of the notices sent to the MSRB are not fully disseminated to the entire marketplace. By requiring delivery of such notices to all NRMSIRs and appropriate SIDs, if any, the Commission preliminarily believes that the completeness and consistency of information from these repositories would be improved, thereby promoting efficiency and having no adverse impacts on competition or capital formation. In fact, competition to establish alternative delivery systems in the private sector may be enhanced by the elimination of the MSRB as a single filing location. 33 MSRB Petition at 3. The Commission requests comment on all aspects of this analysis and, in particular, on whether the proposed amendments to the Rule would place a burden on competition, as well as the effect of the proposed amendments on efficiency, competition, and capital formation. VIII. Consideration of Impact on the Economy For purposes of the Small Business Regulatory Enforcement Fairness Act of 1996, or “SBREFA,” 34 we must advise the Office of Management and Budget as to whether the proposed regulation constitutes a “major” rule. Under SBREFA, a rule is considered “major” where, if adopted, it results or is likely to result in:

(1)An annual effect on the economy of $100 million or more (either in the form of an increase or a decrease);

(2)a major increase in costs or prices for consumers or individual industries; or

(3)significant adverse effect on competition, investment or innovation. The Commission preliminarily believes that this proposed amendment is not a major rule. 34 Pub. L. No. 104-121, Title II, 110 Stat. 857

(1996)(codified in various sections of 5 U.S.C., 15 U.S.C. and as a note to 5 U.S.C. 601). If a rule is “major,” its effectiveness will generally be delayed for 60 days pending Congressional review. We request comment on the potential impact of the proposed rule on the economy on an annual basis. Commenters are requested to provide empirical data and other factual support for their view to the extent possible. IX. Regulatory Flexibility Act Certification Pursuant to Section 605(b) of the Regulatory Flexibility Act (“RFA”), the Commission hereby certifies that the proposed amendments to the Rule, would not, if adopted, have a significant economic impact on a substantial number of small entities. Under the RFA, the term “small entity” shall have the same meaning as the RFA defined terms “small business,” “small organization,” and “small governmental jurisdiction.” According to Section 601(3) of the RFA, “the term “small business” has the same meaning as the term “small business concern” under Section 3 of the Small Business Act (15 U.S.C. 632), unless an agency, after consultation with the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the **Federal Register** .” If the agency has not defined the term for a particular purpose, the Small Business Act states that “a small business concern * * * shall be deemed to be one which is independently owned and operated and which is not dominant in its field of operation.” The Section 601(4) of the RFA defines a “small organization” to include “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” A “small governmental jurisdiction” is defined by Section 601(5) of the RFA to include “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” It is likely that a substantial number of the Issuers required to submit material event notices are small governmental jurisdictions included in the RFA's definition of small entities. However, in this regard, the proposed amendments to the Rule would either not require any additional work for such small entities if they do not currently send material event notices to the MSRB, or would simply require them to send such notices to each of the (currently four) NRMSIRs. However, the Commission believes that the cost of sending such notices to three additional locales would be minimal because such notices are generally short in length and would only encompass the additional costs of copying several pages, as well as the minor additional mailing costs. Finally, the Commission preliminarily believes that those Issuers that currently send their material event notices to each NRMSIR as well as the MSRB would reduce their costs because, under the proposed amendments, the MSRB would no longer be available as a location to send such notices. Thus, while the proposed amendments may impact a small entity, such impact would likely not be significant. For the above reasons, the Commission certifies that the proposed amendments to the Rule would not have a significant economic impact on a substantial number of small entities. The Commission requests comments regarding this certification. The Commission requests that commenters describe the nature of any impact on small businesses and provide empirical data to support the extent of the impact. X. Statutory Authority Pursuant to the Exchange Act, and particularly Sections 3(b), 15(c), 15B and 23(a)(1) the Commission is proposing the amendments to § 240.15c2-12 of Title 17 of the *Code of Federal Regulations* in the manner set forth below. Text of Proposed Rule List of Subjects in 17 CFR Part 240 Brokers, Reporting and recordkeeping requirements, Securities. For the reasons set out in the preamble, Title 17, Chapter II, of the Code of Federal Regulations is proposed to be amended as follows. PART 240—GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF 1934 1. The general authority citation for part 240 is revised to read as follows: Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 78k, 78k-1, 78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll, 78mm, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4, 80b-11, and 7201 *et seq.* ; and 18 U.S.C. 1350, unless otherwise noted. 2. Section 240.15c2-12 is amended by revising the introductory text of paragraph (b)(5)(i)(C) and paragraphs (b)(5)(i)(D) and (d)(2)(ii)(B) to read as follows: § 240.15c2-12 Municipal securities disclosure.

(b)* * *

(5)* * *

(i)* * *

(C)In a timely manner, to each nationally recognized municipal securities information repository and to the appropriate state information depository, if any, notice of any of the following events with respect to the securities being offered in the Offering, if material:

(D)In a timely manner, to each nationally recognized municipal securities information repository and to the appropriate state information depository, if any, notice of a failure of any person specified in paragraph (b)(5)(i)(A) of this section to provide required annual financial information on or before the date specified in the written agreement or contract.

(d)* * *

(2)* * *

(ii)* * *

(B)In a timely manner, to each nationally recognized municipal securities information repository and to the appropriate state information depository, if any, notice of events specified in paragraph (b)(5)(i)(C) of this section with respect to the securities that are the subject of the Offering, if material; and By the Commission. Dated: December 4, 2006. Nancy M. Morris, Secretary. [FR Doc. E6-20829 Filed 12-7-06; 8:45 am] BILLING CODE 8011-01-P INTERNATIONAL TRADE COMMISSION 19 CFR Part 210 [MISC-022] Adjudication and Enforcement AGENCY: U.S. International Trade Commission. ACTION: Notice of proposed rulemaking. SUMMARY: The Commission proposes to amend some of its rules for investigations and related proceedings under section 337 of the Tariff Act of 1930 (19 U.S.C. 1337) to do the following:

(1)Provide for service of certain Commission documents by overnight delivery; and

(2)provide one additional day to respond to Commission documents served by overnight delivery. The current manner of service of Commission documents is not effective according to recent agency studies. These rules will ensure effective service of Commission documents on private parties in section 337 investigations and related proceedings. DATES: Submit comments on or before February 6, 2007. ADDRESSES: You may submit comments, identified by docket number MISC-022 by any of the following methods: • *Federal eRulemaking Portal: http://www.regulations.gov.* Follow the instructions for submitting comments. • *Agency Web Site: http://www.usitc.gov.* Follow the instructions for submitting comments. See *http://www.usitc.gov/secretary/edis.htm.* • *Mail:* For paper submission. U.S. International Trade Commission, 500 E Street, SW., Room 112, Washington, DC 20436. • *Hand Delivery/Courier:* U.S. International Trade Commission, 500 E Street, SW., Room 112, Washington, DC 20436. From the hours of 8:45 a.m. to 5:15 p.m. For detailed instructions on submitting comments, see the “Public Participation” heading of the SUPPLEMENTARY INFORMATION section of this document. FOR FURTHER INFORMATION CONTACT: Clint A. Gerdine, Esq., telephone 202-708-2310, Office of the General Counsel, U.S. International Trade Commission, 500 E Street, SW., Washington, DC 20436. General information concerning the Commission may also be obtained by accessing its Internet server ( *http://www.usitc.gov* ). Hearing-impaired persons are advised that information on the proposed rulemaking can be obtained by contacting the Commission's TDD terminal on 202-205-1810. SUPPLEMENTARY INFORMATION: Public Participation *Instructions:* All submissions received must include the agency name and docket number (MISC-022) or Regulatory Information Number

(RIN)for this rulemaking. All comments received will be posted without change to *http://www.usitc.gov,* including any personal information provided. For paper copies, a signed original and 14 copies of each set of comments, along with a cover letter stating the nature of the commenter's interest in the proposed rulemaking, should be submitted to Marilyn R. Abbott, Secretary, U.S. International Trade Commission, 500 E Street, SW., Room 112, Washington, DC 20436. Comments, along with a cover letter, may be submitted electronically to the extent provided by section 201.8 of the Commission's rules. This rule may refer commenters to the Handbook for Electronic Filing Procedures (see *http://www.usitc.gov/secretary/edis.htm* ). For those submitting comments by mail, it is advisable to mail in comments in advance of the due date since Commission mail will be delayed due to necessary security screening. *Docket:* For access to the docket to read comments received, go to *http://www.usitc.gov* or U.S. International Trade Commission, 500 E Street, SW., Room 112, Washington, DC 20436. The preamble below is designed to assist readers in understanding these proposed amendments to the Commission's rules. The preamble includes a discussion of the background leading up to these proposed amendments, a regulatory analysis addressing government-wide statutes and issuances on rulemaking, and a description of the proposed amendments to the rules. The Commission encourages members of the public to comment—in addition to any other comments they wish to make on the proposed amendments—on whether the proposed language is sufficiently clear for users of the rules to understand. If the Commission decides to proceed with this rulemaking after reviewing the comments filed in response to this notice, the proposed rule revisions will be promulgated in accordance with the Administrative Procedure Act (5 U.S.C. 553), and will be codified in 19 CFR part 210. Background Currently, service of Commission documents in investigations and related proceedings under section 337 of the Tariff Act is effected under section 210.7 of the Commission's rules in part 210 (19 CFR 210.7) which refers back to the general service provisions of § 201.16 of the Commission's rules in part 201 (19 CFR 201.16). Also, the computation of time to respond to Commission documents in section 337 investigations and related proceedings is governed by § 210.6 of the Commission's rules in part 210 (19 CFR 210.6) which refers back to the general computation of time presented in § 201.16(d) of the Commission's rules in part 201 (19 CFR 201.16(d)). Currently, the Commission rules governing service of Commission documents in section 337 investigations and related proceedings allow for service by mail or hand delivery. The Commission is considering changing the manner in which it serves certain documents in section 337 investigations and related proceedings to:

(1)Eliminate gamesmanship between parties served by different manners of service in responding to Commission documents; and

(2)streamline service of Commission documents. The Commission proposes that certain Commission documents, which are identified below, be served by overnight delivery on private parties. For these documents hand pickup will not be permitted. Parties served by overnight delivery will be given one additional day to respond. The Commission is considering providing the Commission Investigative Attorney (“IA”) with sufficient time to allow filing contemporaneously with the private parties. Regulatory Analysis of Proposed Amendments to 19 CFR Part 210 The Commission has determined that the proposed rules do not meet the criteria described in Section 3(f) of Executive Order 12866 (58 FR 51735, Oct. 4, 1993) and thus do not constitute a significant regulatory action for purposes of the Executive Order. The Regulatory Flexibility Act (5 U.S.C. 601 *et seq.* ) is inapplicable to this rulemaking because it is not one for which a notice of proposed rulemaking is required under 5 U.S.C. 553(b) or any other statute. Although the Commission has chosen to publish a notice of proposed rulemaking, these proposed regulations are “agency rules of procedure and practice,” and thus are exempt from the notice requirement imposed by 5 U.S.C. 553(b). These proposed rules do not contain federalism implications warranting the preparation of a federalism summary impact statement pursuant to Executive Order 13132 (64 FR 43255, Aug. 4, 1999). No actions are necessary under the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1501 *et seq.* ) because the proposed rules will not result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more in any one year, and will not significantly or uniquely affect small governments. The proposed rules are not major rules as defined by section 804 of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 *et seq.* ). Moreover, they are exempt from the reporting requirements of the Contract With America Advancement Act of 1996 (Pub. L. 104-121) because they concern rules of agency organization, procedure, or practice that do not substantially affect the rights or obligations of non-agency parties. The amendments are not subject to section 3504(h) of the Paperwork Reduction Act (44 U.S.C. 3501 *et seq.* ), since they do not contain any new information collection requirements. Explanation of the Proposed Amendments to 19 CFR Part 210 The Commission proposes to amend part 210 in the manner described below. Section 210.6 Section 210.6 governs the computation of response time when a party is served with a document that requires a response. The Commission proposes to amend that rule by adding provisions concerning when to respond to Commission documents that are served by overnight delivery. The Commission proposes to revise the text of § 210.6 by dividing the current text and designating the portions as paragraphs

(a)and

(b)of the amended rule. Also, the Commission proposes to add a new paragraph

(c)which provides that a party shall be given one additional day to respond to a Commission document when served by overnight delivery, and add another new paragraph

(d)which defines “overnight delivery”. Section 210.7 Paragraph

(a)of § 210.7 governs the service of process of Commission documents. The Commission proposes to amend that rule by adding provisions concerning service of certain documents by overnight delivery on private parties (for these documents hand pickup will not be permitted). The Commission proposes to revise and redesignate current paragraph

(a)as paragraph (a)(1), and then add new paragraph (a)(2) which provides that certain Commission documents shall be served by overnight delivery. List of Subjects in 19 CFR Part 210 Administration practice and procedure, Business and industry, Customs duties and inspection, Imports, Investigations. For the reasons discussed in the preamble, the United States International Trade Commission proposes to amend 19 CFR part 210 as follows: PART 210—ADJUDICATION AND ENFORCEMENT 1. The authority citation for part 210 will continue to read as follows: Authority: 19 U.S.C. 1333, 1335, and 1337. 2. Revise § 210.6 to read as follows: § 210.6 Computation of time, additional hearings, postponements, continuances, and extensions of time.

(a)Unless the Commission, the administrative law judge, or this or another section of this part specifically provides otherwise, the computation of time and the granting of additional hearings, postponements, continuances, and extensions of time shall be in accordance with §§ 201.14 and 201.16(d) of this chapter.

(b)Whenever a party has the right or is required to perform some act or to take some action within a prescribed period after service of a document upon it, and the document was served by mail, the deadline shall be computed by adding to the end of the prescribed period the additional time allotted under § 201.16(d), unless the Commission, the administrative law judge, or another section of this part specifically provides otherwise.

(c)Whenever a party has the right or is required to perform some act or to take some action within a prescribed period after service of a Commission document upon it, and the document was served by overnight delivery, the deadline shall be computed by adding one day to the end of the prescribed period, unless the Commission, the administrative law judge, or another section of this part specifically provides otherwise.

(d)“Overnight delivery” is defined as delivery by the next business day. 3. Amend § 210.7 by revising paragraph

(a)to read as follows: § 210.7 Service of process and other documents; publication of notices.

(a)*Manner of service.*

(1)The service of process and all documents issued by or on behalf of the Commission or the administrative law judge—and the service of all documents issued by parties under §§ 210.27 through 210.34 of this part—shall be in accordance with § 201.16 of this chapter, unless the Commission, the administrative law judge, or this or another section of this part specifically provides otherwise.

(2)The service of all initial determinations as defined in § 210.42 and all documents containing confidential business information—issued by or on behalf of the Commission or the administrative law judge—on a private party shall be effected by serving a copy of the document by overnight delivery—as defined in § 210.6(d)—on the person to be served, on a member of the partnership to be served, on the president, secretary, other executive officer, or member of the board of directors of the corporation, association, or other organization to be served, or, if an attorney represents any of the above before the Commission, by serving a copy by overnight delivery on such attorney. Issued: December 4, 2006. By Order of the Commission. Marilyn R. Abbott, Secretary to the Commission. [FR Doc. E6-20766 Filed 12-7-06; 8:45 am] BILLING CODE 7020-02-P DEPARTMENT OF THE INTERIOR National Indian Gaming Commission 25 CFR Parts 502, 546, and 547 Class II Definitions and Gaming Standards and Technical Standards AGENCY: National Indian Gaming Commission, Interior ACTION: Notice of reopening of comment period. SUMMARY: This notice reopens the period for comments on proposed Class II definitions and game classification standards published in the **Federal Register** on May 25, 2006 (71 FR 30232, 71 FR 30238). This notice also reopens the period for comments on proposed Class II technical standards published in the **Federal Register** on August 11, 2006 (71 FR 46336). DATES: The comment period for the proposed classification, definition, and technical regulations is being reopened from November 15, 2006, to December 15, 2006. FOR FURTHER INFORMATION CONTACT: Penny Coleman, John Hay, or Michael Gross at 202/632-7003; fax 202/632-7066 (these are not toll-free numbers). SUPPLEMENTARY INFORMATION: Congress established the National Indian Gaming Commission (NIGC or Commission) under the Indian Gaming Regulatory Act of 1988 (25 U.S.C. 2701 *et seq.* )

(IGRA)to regulate gaming on Indian lands. On May 25, 2006, proposed Class II definitions and game classification standards were published in the **Federal Register** (71 FR 30232, 71 FR 30238). On August 11, 2006, proposed Class II technical standards were published in the **Federal Register** (71 FR 46336). Dated: December 4, 2006. Philip N. Hogen, Chairman, National Indian Gaming Commission. Cloyce V. Choney, Commissioner, National Indian Gaming Commission. [FR Doc. E6-20843 Filed 12-7-06; 8:45 am] BILLING CODE 7565-01-P DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 1 [REG-121509-00] RIN 1545-AY54 Exclusion From Gross Income of Previously Taxed Earnings and Profits and Adjustments to Basis of Stock in Controlled Foreign Corporations and of Other Property; Correction AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Correction to notice of proposed rulemaking. SUMMARY: This document corrects notice of proposed rulemaking (REG-121509-00) that was published in the **Federal Register** on Tuesday, August 29, 2006 (71 FR 51155). The document contains proposed regulations that provide guidance relating to the exclusion from gross income of previously taxed earnings and profits under section 959 of the Internal Revenue Code

(Code)and related basis adjustments under section 961 of the Code. FOR FURTHER INFORMATION CONTACT: Ethan Atticks,

(202)622-3840 (not a toll-free number). SUPPLEMENTARY INFORMATION: Background The notice of proposed rulemaking (REG-121509-00) that is the subject of these corrections is under sections 959 and 961 of the Internal Revenue Code. Need for Correction As published, REG-121509-00 contains errors that may prove to be misleading and are in need of clarification. Correction of Publication Accordingly, the notice of proposed rulemaking (REG-121509-00), that was the subject of FR Doc. 06-7195, is corrected as follows: 1. On page 51155, column 1, in the preamble, under the paragraph heading “Background”, the last paragraph of the column, third line, the language, “sections 959 and 961. Section 959(a)(1)” is corrected to read “sections 959, 961, and 1502. Section 959(a)(1)”. 2. On page 51156, column 1, in the preamble, the last paragraph of the column, fifth line from bottom, the language “109-222), which provides for look-” is corrected to read “109-222), which generally provides for look-”. 3. On page 51156, column 3, in the preamble, under paragraph heading “2. Shareholder PTI Accounts”, sixth line, the language “directly, or indirectly under section” is corrected to read “directly or indirectly under section”. 4. On page 51157, column 1, in the preamble, under paragraph heading “3. Successors in Interest”, second paragraph, sixteenth line, the language “corporation from a person that is not a” is corrected to read “corporation from any person, including a person that is not a”. 5. On page 51157, column 1, in the preamble, under paragraph heading “ *B. CFC-Level Exclusion Under Section 959(b)* ” first line of first paragraph, the language “The earnings and profits of a CFC” is corrected to read “Section 959(b) provides an exclusion pursuant to which the earnings and profits of a CFC”. 6. On page 51157, column 1, in the preamble, under paragraph heading “ *B. CFC-Level Exclusion Under Section 959(b)* ”, first paragraph, third line from the bottom of the paragraph, the language “rules regarding cross-chain sales of” is corrected to read “to provide guidance regarding cross-chain sales of”. 7. On page 51157, column 2, in the preamble, first paragraph of the column, ninth line, the language “section 951(a)) and a $100 of non-” is corrected to read “section 951(a)) and $100x of non-”. 8. On page 51157, column 2, in the preamble, first paragraph of the column, last line, the language “$91x ((70% × $30) + (70% × $100)).” is corrected to read “$91x ((70% × $30x) + (70% × $100x)).”. 9. On page 51157, column 2, in the preamble, second paragraph of the column, third line, the language “accordingly, provides that, the amount” is corrected to read “accordingly, provides that the amount”. 10. On page 51157, column 2, in the preamble, second paragraph of the column, eleventh line, the language “of section 958(a)) in the lower-tier and” is corrected to read “of section 958(a)) in the lower-and”. 11. On page 51157, column 2, in the preamble, fourth paragraph of the column, seventh line, the language “CFC from a person who was not taxed” is corrected to read “CFC from a person that was not taxed”. 12. On page 51157, column 3, in the preamble, first paragraph of the column, eighth line, the language “inclusion is still $100. In contrast, Prop.” is corrected to read “inclusion is still $100x. In contrast, Prop.”. 13. On page 51157, column 3, in the preamble, under the paragraph heading “1. Shareholder-Level Accounting of PTI”, last line of the column, the language “shareholder who owns the stock or by” is corrected to read “shareholder that owns the stock or by”. 14. On page 51158, column 2, in the preamble, under the paragraph heading “a. Dollar Basis Pooling Election”, first paragraph of the column, ninth to fifteenth lines, the language “to a distribution of PTI. Notice 88-71 (1988-2 C.B. 374) makes this pooled approach available to taxpayers for purposes of section 986(c) at the taxpayer's election, but it does not provide guidance as to how this election is made. The proposed regulations” is corrected to read “to a distribution of PTI. The proposed regulations make this pooled approach available to taxpayers for purposes of section 986(c) at the taxpayer's election. The proposed regulations”. 15. On page 51158, column 3, in the preamble, under paragraph heading “4. Adjustment of Shareholder PTI Accounts”, second paragraph, tenth line, the language “corporation. Next, a shareholder's PTI” is corrected to read “corporation. Second, a shareholder's PTI”. 16. On page 51160, column 1, in the preamble, under paragraph heading “b. Shareholder That Is a Member of a Consolidated Group”, first paragraph, seventh line from the bottom of the first paragraph, the language “consolidated group who own stock in” is corrected to read “consolidated group that own stock in”. 17. On page 51160, column 1, in the preamble, second paragraph, eleventh line, the language “taxable year who own stock in the” is corrected to read “taxable year that own stock in the”. 18. On page 51161, column 3, in the preamble, under paragraph heading “ *A. Coordination of Shareholder-Level and Corporate-Level Accounts* ”, ninth line, the language “PTI information is to be shared between” is corrected to read “PTI information is to be shared among”. 19. On page 51161, column 3, in the preamble, thirteenth line, the language “are necessary, and if so, how they” is corrected to read “are necessary and, if so, how they”. 20. On page 51162, column 3, in the preamble, under paragraph heading “ *F. Section 961(c) Basis Adjustments* ”, first line of the paragraph, the language “Section 961(c) is by its terms only” is corrected to read “Section 961(c) is only”. § 1.959-1 [Corrected] 21. On page 51163, column 3, § 1.959-1(a), second line of the column, the language “except that such distributions shall” is corrected to read “except that such distribution shall”. 22. On page 51164, column 1, § 1.959-1(b)(2), first paragraph of the column, fifth and sixth lines, the language “any) that are attributable to section 951(a) inclusions.” is corrected to read “any).”. 23. On page 51164, column 1, § 1.959-1(b)(3), second paragraph of the column, third line, the language “income with respect to the previously” is corrected to read “a United States shareholder's income with respect to the previously”. 24. On page 51164, column 1, § 1.959-1(b)(4)(iii), second line from the bottom of the paragraph, the language “corporations are members of the same” is corrected to read “if both the first mentioned corporation and the covered shareholder are members of the same”. 25. On page 51165, column 1, § 1.959-1(d)(3), second paragraph of the column, first line, the language “The application of this paragraph” is corrected to read “ *Examples* . The application of this paragraph”. 26. On page 51165, column 1, § 1.959-1(d)(3), *Example 1* ., paragraph heading, the language “ *Shareholder previously taxed earnings and profits account* .” is corrected to read “ *Shareholder's previously taxed earnings and profits account* .”. 27. On page 51165, column 1, § 1.959-1(d)(3)(i), eighth and ninth lines, the language “currency. FC earns $100x of subpart F income in year 1 and $100x of non-subpart” is corrected to read “currency. In year 1, FC earns $100x of subpart F income and $100x of non-subpart F”. § 1.959-2 [Corrected] 28. On page 51165, column 2, § 1.959-2(a)(1), fourth line from the bottom of the paragraph, the language “income of such distributee CFC also” is corrected to read “income of such upper-tier CFC also”. 29. On page 51165, column 3, § 1.959-2(a)(2), paragraph

(i)of *Example 2* ., second line from the bottom of the paragraph, the language “2, and FC had no earnings for year 2 other” is corrected to read “2, and FC had no earnings and profits for year 2 other”. 30. On page 51165, column 3, § 1.959-2(a)(2), paragraph

(ii)of *Example 3* ., eighth and ninth lines, the language “DP's pro rata share of the remaining $50, or $35 ($50 × 70%), is included in DP's gross” is corrected to read “DP's pro rata share of the remaining $50x, or $35x ($50x × 70%), is included in DP's gross”. 31. On page 51166, column 1, § 1.959-2(a)(2), paragraph

(ii)of *Example 3* ., first paragraph of the column, first line, the language “reduced to $0, however, as a result of the” is corrected to read “reduced to $0, as a result of the”. 32. On page 51166, column 1, § 1.959-2(b)(2), third paragraph of the column, first line, the language “The application of this paragraph” is corrected to read “ *Example* . The application of this paragraph”. § 1.959-3 [Corrected] 33. On page 51166, column 3, § 1.959-3(b)(3)(i), third paragraph of the column, fifth through twelfth lines, the language “earnings and profits in the year in which such amounts are included in gross income of a United States shareholder under section 951(a) and are reclassified as to category of earnings and profits in the year in which such amounts would be so included but for the provisions of” is corrected to read “earnings and profits in the taxable year of the foreign corporation in which such amounts are included in the gross income of a United States shareholder under section 951(a) and are reclassified as to category of earnings and profits in the taxable year of the foreign corporation in which such amounts would be so included in the gross income of a United States shareholder under section 951(a) but for the provisions of”. 34. On page 51167, column 2, § 1.959-3(c)(1), third paragraph of the column, fourth line, the language “are distributed by a foreign corporation” is corrected to read “are distributed by a foreign corporation to another foreign corporation”. 35. On page 51167, column 2, § 1.959-3(c)(1), fourteenth line, the language “included in the foreign corporation's” is corrected to read “included in the distributee foreign corporation's”. 36. On page 51167, column 2, § 1.959-3(c)(2), fourth paragraph of the column, first line, the language “The application of this paragraph” is corrected to read “ *Example* . The application of this paragraph”. 37. On page 51172, column 3, § 1.959-3(g)(4), paragraph

(i)of *Example 1* ., first paragraph of the column, fourth line from the bottom of the paragraph, the language “earnings and profits on its stock Class A” is corrected to read “earnings and profits on its Class A”. 38. On page 51173, column 3, § 1.959-3(g)(4), paragraph

(i)of *Example 5* ., third line, the language “on its stock Class A stock consisting of a” is corrected to read “ on its Class A stock consisting of a”. 39. On page 51174, column 3, § 1.959-3(h)(3)(i), third paragraph of the column, fourth line from the bottom of the paragraph, the language “§§ 1.959-1 and this section shall apply” is corrected to read “§ 1.959-1 and this section shall apply”. 40. On page 51175, column 1, § 1.959-3(h)(4)(i), fourth paragraph of the column, fifth line from the bottom of the paragraph, the language “§§ 1.959-1 and this section shall” is corrected to read “§ 1.959-1 and this section shall”. 41. On page 51175, column 1, § 1.959-3(h)(4)(ii), fifth paragraph of the column, first line, the language “The application of this paragraph” is corrected to read “ *Example* . The application of this paragraph”. § 1.961-2 [Corrected] 42. On page 51177, column 1, § 1.961-2(d), paragraph

(i)of *Example 3* ., third paragraph of the column, third line from the bottom of the paragraph, the language “December 31, of year 1. In year 2, DP has a” is corrected to read “December 31 of year 1. In year 2, DP has a”. § 1.961-3 [Corrected] 43. On page 51177, column 2, § 1.961-3(a)(1), first paragraph of the column, second line from the bottom of the paragraph, the language “shareholders gross income under” is corrected to read “shareholder's gross income under”. 44. On page 51177, column 3, § 1.961-3(b)(1), third paragraph of the column, twelfth line, the language “than wholly owned by a single United” is corrected to read “than wholly indirectly owned by a single United”. LaNita Van Dyke, Chief, Publications and Regulations Branch, Legal Processing Division, Associate Chief Counsel, (Procedure and Administration). [FR Doc. E6-20798 Filed 12-7-06; 8:45 am] BILLING CODE 4830-01-P DEPARTMENT OF EDUCATION 34 CFR Parts 674, 682, and 685 Office of Postsecondary Education; Notice of Intent To Establish Negotiated Rulemaking Committees Under Title IV of the Higher Education Act of 1965, as Amended AGENCY: Department of Education. ACTION: Notice of negotiated rulemaking. SUMMARY: The Secretary of Education (Secretary) announces the establishment of a negotiated rulemaking committee to develop proposed regulations related to the Federal student loan programs authorized by Title IV, Parts B, D, and E of the Higher Education Act of 1965, as amended (HEA). The Secretary is also announcing that she will establish a negotiating committee that will begin meeting in January to address issues related to the Academic Competitiveness Grant

(ACG)and the National Science and Mathematics Access to Retain Talent (National SMART) Grant programs. The Secretary is still considering whether to establish additional committees to address accreditation issues and/or other Title IV programmatic, institutional eligibility and general provisions issues. The Secretary also is announcing that she is reopening our request for nominations of individual negotiators to serve on the ACG and National SMART Grant programs committee and any additional negotiating committees that may be formed to address accreditation issues and other Title IV programmatic, institutional eligibility, and general provisions issues. DATES: The dates for the negotiation sessions are listed in the SUPPLEMENTARY INFORMATION section of this notice. We must receive your nominations for negotiators to serve on the ACG and National SMART Grant programs committee and on any additional committees that may be established to address accreditation issues and other Title IV programmatic, institutional eligibility, and general provisions issues on or before December 22, 2006. FOR FURTHER INFORMATION CONTACT: Wendy Macias, U.S. Department of Education, 1990 K Street, NW., room 8017, Washington, DC 20006. Telephone:

(202)502-7526. E-mail: *Wendy.Macias@ed.gov.* If you use a telecommunications device for the deaf (TDD), you may call the Federal Relay Service

(FRS)at 1-800-877-8339. Individuals with disabilities may obtain this document in an alternative format ( *e.g.* , Braille, large print, audiotape, or computer diskette) on request to the contact person listed in this section. SUPPLEMENTARY INFORMATION: On August 18, 2006, we published a notice in the **Federal Register** (71 FR 47756) announcing our intent to establish up to four negotiated rulemaking committees to prepare regulations under Title IV of the HEA. The notice also announced a series of four regional hearings where interested parties could suggest issues for consideration for action by the negotiating committees. We also invited parties to submit issues for consideration in writing. In the notice, we requested nominations for individual negotiators who represent key stakeholder constituencies that are involved in the student financial assistance programs authorized under Title IV of the HEA to serve on these committees. After consideration of the information received at the regional hearings and in writing, we have decided to establish a negotiating committee (“Loans Committee”) that will begin meeting in December 2006 to address issues related to the Federal student loan programs authorized by Title IV, Parts B, D, and E of the HEA. We list the topics the Loans Committee is likely to address, the members of the committee, and the meeting schedule for the committee elsewhere in this notice under *Loans Committee Topics, Members, and Meeting Schedule.* We will also establish a negotiating committee that will begin meeting in January 2007 to address issues related to the ACG and the National SMART Grant programs. We are still considering whether to establish additional committees to address accreditation issues and other Title IV programmatic, institutional eligibility and general provisions issues. We are reopening our request for nominations for individual negotiators who represent key stakeholder constituencies to serve on the ACG and National SMART Grant programs committee and any additional negotiating committees that may be formed to address accreditation issues and Title IV programmatic, institutional eligibility, and general provisions issues (see *Invitation for Additional Nominations for the ACG and National SMART Grant Program Committees and Possible Additional Committees* elsewhere in this notice). We will announce the members of the ACG and National SMART Grant programs committee, the issues this committee will likely address, and the meeting schedule for this committee in the **Federal Register** at a later date. We will announce the formation of any additional negotiating committees in the **Federal Register** in early 2007. Loans Committee Topics, Members, and Meeting Schedule The topics the Loans Committee is likely to address are: • Entrance Counseling for Graduate and Professional Student PLUS Loan borrowers. • Discharge of student loans based on identity theft of the borrower. • Eligible lender trustee relationships between Federal Family Education Loan

(FFEL)lenders and schools or school-affiliated organizations. • Use of lists of FFEL preferred lenders. • Prohibited inducements in the FFEL program. • FFEL loan certification and Direct Loan origination for non-standard term programs. • Modifications to the Economic Hardship Deferment provisions and Income Contingent Repayment Formula to improve consideration of family size. • Retention of disbursement records supporting Title IV, HEA loan program Master Promissory Notes (MPNs). • Documentation of E-Signature standards on Title IV Loan Program MPNs Assigned to ED. • Use of true and exact copies of death certificates for discharges of student loans based on death. • The impact of retroactive conditional disability periods on total and permanent disability loan discharges. • National Student Loan Data System reporting timeframes for lenders. • Assignment of defaulted Perkins Loans. • Eligibility requirements for the Perkins Loan Program Child & Family Service Cancellation • Definition of “reasonable and affordable” collection costs in the Perkins Loan Program. • Technical corrections. This list of topics is tentative. Topics may be added as the process continues. In selecting individuals from the submitted nominations, the Department sought to assemble a balanced and complementary representation of the interests affected by the subject matter, consistent with section 492 of the HEA. We believe the individuals selected will bring valuable knowledge and expertise to the table, and will work as a cohesive unit to assist us in developing proposed regulations that are both reasonable and effective. Individuals that were not selected as members of the committees will be able to attend the meetings and have access to the negotiators. The committee meetings will be open to the public. The members of the Loans Committee are: *Students:* Jennifer Pae, United States Student Association *Alternate:* Luke Swarthout, State Public Interest Research Groups *Legal assistance organizations that represent students:* Deanne Loonin, National Consumer Law Center. *Public 2-Year Institutions of higher education:* Darrel Hammon, Laramie Community College. *Alternate:* Kenneth L. Whitehurst, North Carolina Community Colleges. *Public 4-Year Institutions of higher education:* Pamela W. Fowler, University of Michigan. *Alternate:* Patricia McClug, University of Wyoming. *Private, non-profit Institutions of higher education:* Elizabeth Hicks, Massachusetts Institute of Technology. *Alternate:* Ellen Frishberg, Johns Hopkins University. *Private, for-profit postsecondary education institution:* Jeff Arthur, ECPI College of Technology. *Alternate:* Robert Collins, Apollo Group, Inc. *Historically Black Colleges and Universities:* Shari Crittendon, United Negro College Fund. *Alternate:* Dr. N. Joyce Payne, National Association of State and Land Grant Colleges and Universities. *Guaranty agencies:* Scott Giles, Vermont Student Assistance Corporation. *Alternate:* Rachael Lohman, Pennsylvania Higher Education Assistance Agency. *FFEL Program Lenders:* Tom Levandowski, Wachovia Corporation. *Alternate:* Lee Woods, Chase Education Finance. *Secondary markets:* Phil Van Horn, Wyoming Student Loan Corporation. *Alternate:* Robert L. Zier, Indiana Secondary Market for Education Loan Program, Inc. *Loan servicers:* Robert Sommer, Sallie Mae. *Alternate:* Wanda Hall, EDFinancial Services. *Guaranty agency servicers:* Richard George, Great Lakes Education Guaranty Corporation. *Alternate:* Gene Hutchins, New Jersey Higher Education Assistance Authority. *Institutions of higher education that participate in the Federal Direct Loan Program:* Eileen O'Leary, Stonehill College. *Alternate:* Christine W. McGuire, Boston University. *Institutions of higher education that participate in the Perkins Loan Program:* Alisa Abadinsky, University of Illinois at Chicago. *Alternate:* Karen Fooks, University of Florida. We will hold a total of three meetings, all of which will be held in the metropolitan Washington, DC area. The following is the schedule for negotiations. This schedule is subject to change. • Session 1: December 12-14. • Session 2: January 29-February 1. • Session 3: February 26-February 28. The December 12-14 negotiating session is scheduled from 1 to 5 p.m. on December 12th; 9 a.m. to 5 p.m. on December 13th; and 9 a.m. to 4 p.m. on December 14th. The Committee will convene at the Marriott Crystal Gateway at 1700 Jefferson Davis Highway, Arlington, Virginia. We will post information about the January and February negotiating sessions, including information on the meeting sites and any schedule changes, at *http://www.ed.gov/policy/highered/reg/hearulemaking/2007/nr.html.* Participation in the rulemaking process is not limited to members of the committee or those who work with the committee. Following the negotiated rulemaking process, we will publish proposed regulations in the **Federal Register** for public comment. The target date for publication of proposed regulations developed by this committee is May 2007. Invitation for Additional Nominations for the ACG and National SMART Grant Programs Committee and Possible Additional Committees We are reopening our request for nominations for individual negotiators who represent key stakeholder constituencies that are involved in the student financial assistance programs authorized under Title IV of the HEA to serve on the ACG and National SMART Grant programs committee and any committee that may be formed to address accreditation issues (Title IV, Part H of the HEA) or other programmatic, institutional eligibility, and general provisions issues related to Title IV, Parts A (except for ACG and National SMART Grant programs), C, G, and H (except subpart 2) of the HEA, as well as Title II, Section 208(b)(2) of the HEA. Nominations must be received on or before December 22, 2006. The Secretary has identified the following constituencies as having interests that are significantly affected by the subject matter of the negotiating committee for the ACG and National SMART Grant Programs and the committees that may be established to negotiate changes to the other regulations. These constituencies are: • Students. • Legal assistance organizations that represent students. • Financial aid administrators at institutions of higher education. • Business officers and bursars at institutions of higher education. • Institutional servicers (including collection agencies). • Trustees. • State higher education executive officers. • Business and industry. • Institutions of higher education eligible to receive Federal assistance under Title III, Parts A and B, and Title V of the HEA, which includes Historically Black Colleges and Universities, Hispanic-Serving Institutions, American Indian Tribally Controlled Colleges and Universities, Alaska Native and Native Hawaiian-Serving Institutions, and other institutions with a substantial enrollment of needy students as defined in Title III of the HEA. • Two-year public institutions of higher education. • Four-year public institutions of higher education. • Private, non-profit institutions of higher education. • Private, for-profit institutions of higher education. • Guaranty agencies and guaranty agency servicers (including collection agencies). • Lenders, secondary markets, and loan servicers. • Accrediting agencies. • K-12 public schools, including charter schools. • State Governors. • Private schools and home schooled students. • Admissions officers at postsecondary education institutions. • Parent organizations. • Organizations related to National SMART Grant majors. Individuals who were nominated for these committees in response to our earlier notice do not need to be renominated. Electronic Access to This Document You may view this document in text or Adobe Portable Document Format

(PDF)on the Internet at the following site: *http://www.ed.gov/news/fedregister.* To use PDF you must have Adobe Acrobat Reader, which is available free at this site. If you have questions about using PDF, call the U.S. Government Printing Office toll free at 1-888-293-6498; or in the Washington, DC area at

(202)512-1530. Note: The official version of this document is the document published in the **Federal Register** . Free Internet access to the official edition of the **Federal Register** and the Code of Federal Regulations is available on GPO Access at: *http://www.gpoaccess.gov/nara/index.html.* Program Authority: 20 U.S.C. 1098a. Dated: December 5, 2006. James F. Manning, Delegated the Authority of Assistant Secretary for Postsecondary Education. [FR Doc. E6-20931 Filed 12-7-06; 8:45 am] BILLING CODE 4000-01-P 71 236 Friday, December 8, 2006 Notices DEPARTMENT OF AGRICULTURE Forest Service Thorn Fire Salvage Recovery Project, Malheur National Forest, Grant County, OR AGENCY: Forest Service, USDA. ACTION: Notice of intent to prepare an environmental impact statement. SUMMARY: The USDA Forest Service will prepare an environmental impact statement

(EIS)to disclose environmental effects on a proposed action to recover the economic value of dead and dying tees damaged in the Shake Table Fire Complex, and remove potential hazard trees from open forest travel routes within the Todd, Duncan, Fields Creek and Dry Creek subwatersheds. Shake Table Fire Complex, located approximately 20 miles southwest of John Day, Oregon, burned approximately 14,527 acres across mixed ownership in August 2006, of that approximately 13,536 acres were on National Forest System Lands administered by the Blue Mountain Ranger District, Malheur National Forest. The proposed action is the Thorn Fire Salvage Recovery Project. DATES: Comments concerning the scope of the analysis must be received by January 8, 2007. The draft EIS is expected to be filed with the Environmental Protection Agency

(EPA)and be available to the public for review by April 2007. The Final EIS is scheduled to be completed by June 2007. ADDRESSES: Send written comments to the Responsible Official, Gary L. “Stan” Benes, Forest Supervisor, Malheur National Forest, 431 Patterson Bridge Road, P.O. Box 909, John Day, Oregon 97845. send electronic comments to: *comments-pacificnorthwest-malheur@fs.fed.us.* FOR FURTHER INFORMATION CONTACT: Jerry Hensley, Project Manager, Malheur National Forest, 431 Patterson Bridge Road, P.O. Box 909, John Day, Oregon, telephone 541-575-3167, e-mail *jhensley@fs.fed.us.* SUPPLEMENTARY INFORMATION: Purpose and Need for Action The purpose and need of the Thorn Fire Salvage Recovery Project includes:

(1)Recovery of the economic value of a portion of the dead and dying trees consistent with protection of other resource values; and

(2)Improving public safety within the fire area by removing potentional hazard trees for public safety along open forest travel routes. Proposed Action This action includes salvage of fire killed trees from approximately 4,480 acres and removal of potential hazard trees for public safety along open forest travel routes. Salvage harvest methods would include ground-based and helicopter logging systems. Approximately 80 percent of the harvest area would be salvaged by helicopter. No commercial harvest or road construction is proposed within Appendix C Inventoried Dry Cabin, Cedar Grove and Shake Table Roadless Areas. Road activities associated with salvage and restoration will be limited to reconstruction, opening and re-closing existing roads, and maintenance. No new roads would be built. Following site preparation, approximately 4,480 acres would be planted with conifer seedlings. Forest Plan amendments would be included as needed. Possible Alternatives Alternatives will include the proposed action, no action, and additional alternatives that respond to issues generated during the scoping process. The agency will give notice of the full environmental analysis and decision-making process to interested and affected people may participate and contribute to the final decision. Responsible Official and Nature of Decision To Be Made The Responsible Official is Gary L. “Stan” Benes, Forest Supervisor of the Malheur National Forest, 431 Patterson Bridge Road, P.O. Box 909, John Day, OR 97845. The Responsible Official will decide if the proposed project will be implemented and will document the decision and reasons for the decision in a Record of Decision. That decision will be subject to Forest Service Appeal Regulations. The responsibility for preparing the DEIS and FEIS has been delegated to Brooks Smith, Acting District Ranger, Blue Mountain Ranger District. Scoping Process Public participation will be especially important at several points during the analysis, beginning with the scoping process (40 CFR 1501.7). Initial scoping began with the project listed in the 2006 Fall Edition of the Malheur National Forest's Schedule of Proposed Actions. A Public meeting has been planned for January 2007 to discuss the project. Other meetings will be scheduled as needed. Also, correspondence with tribes, government agencies, organizations, and individuals who have indicated their interested will be conducted. Preliminary Issues Preliminary issues identified include the potential effect of the proposed action on: Soils, water quality and fish habitat, snags and down wood, disturbance to cultural resources, potential for noxious weed expansion, threatened, endangered and sensitive aquatic, terrestrial and plant species, potential loss of economic value of trees damaged by wildfire, and the safety and use of the area by public and land managers. Comment Public comments about this proposal are requested to identify issues and alternatives to the proposed action and to focus the scope of the analysis. Comments received in response to solicitation, including names and addresses of those who comment, will be considered part of the public record on this proposed action, and will be available for public inspection. Comments submitted anonymously will be accepted and considered; however, those who submit anonymous comments will not have standing to appeal the subsequent decisions under 36 CFR Parts 215 or 217. Additionally, pursuant to 7 CFR 1.27(d), any person may request the agency to withhold a submission from the public record by showing how the Freedom of Information Act

(FOIA)permits such confidentiality. Persons requesting such confidentiality should be aware that under the FOIA, confidentiality may be granted in only very limited circumstances such as to protect trade secrets. The Forest Service will inform the requester of the agency's decisions regarding the request for confidentiality, and where the request is denied; the agency will return the submission and notify the requester that the comments may be resubmitted with or without name and address within a specified number of days. Early Notice of Importance of Public Participation in Subsequent Environmental Review A draft environmental impact statement will be prepared for comment. The comment period on the draft environmental impact statement will be 45 days from the date the Environmental Protection agency publishes the notice of availability in the **Federal Register** . The Forest Service believes, at this early stage, it is important to give reviewers notice of several court rulings related to public participation in the environmental review process. First, reviewers of draft environmental impact statements must structure their participation in the environmental review of the proposal so that it is meaningful and alerts an agency to the reviewer's position and contentions. *Vermont Yankee Nuclear Power Corp.* v. *NRDC* , 435 U.S. 519, 553 (1978). Also, environmental objections that could be raised at the draft environmental impact statement stage but that are not raised until after completion of the final environmental impact statement may be waived or dismissed by the courts. *City of Angoon v. Hodel* , 803 F.2d 1016, 1022 (9th Cir. 1986) and *Wisconsin Heritages, Inc.* v. *Harris* , 490 F. Supp. 1334, 1338 (E.D. Wis. 1980). Because of these court rulings, it is very important that those interested in this proposed action participate by the close of the 45-day comment period so that substantive comments and objections are made available to the Forest Service at a time when it can meaningfully consider them and respond to them in the final environmental impact statement. To assist the Forest Service in identifying and considering issues and concerns on the proposed action, comments on the draft environmental impact statement should be as specific as possible. It is also helpful if comments refer to specific pages or chapters of the draft statement. Comments may also address the adequacy of the draft environmental impact statement or the merits of the alternatives formulated and discussed in the statement. Reviewers may wish to refer to the Council on Environmental Quality Regulations for implementing the procedural provisions of the National Environmental Policy Act of 40 CFR 1503.3 in addressing these points. Comments received, including the names and addresses of those who comment, will be considered part of the public record on this proposal and will be available for public inspection. (Authority: 40 CFR 1501.7 and 1508.22; Forest Service Handbook 1909.15, Section 21) Dated: December 4, 2006. Gay L. Benes, Forest Supervisor. [FR Doc. 06-9593 Filed 12-7-06; 8:45 am]

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