Notices. Notice of public meeting; request for comments
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BILLING CODE 3510-22-S 72 77 Monday, April 23, 2007 Proposed Rules DEPARTMENT OF HOMELAND SECURITY Office of the Secretary 6 CFR Part 37 [Docket No. DHS-2006-0030] RIN 1601-AA37 Minimum Standards for Driver's Licenses and Identification Cards Acceptable by Federal Agencies for Official Purposes AGENCY: Office of the Secretary, DHS. ACTION: Notice of public meeting; request for comments. SUMMARY: The Department of Homeland Security, Office of the Secretary, will hold a public meeting to receive comments on the Notice of Proposed Rulemaking, “Minimum Standards for Driver's Licenses and Identification Cards Acceptable by Federal Agencies for Official Purposes,” published in the **Federal Register** on March 9, 2007 (72 FR 10820).
We encourage interested parties to attend the meeting and submit comments for discussion during the meeting. In addition, we will also seek comments via email for discussion during the meeting from any party who is unable to attend in person. The webcast of the public meeting will be viewable at *http://www.realidtownhall.com* . DATES: *Public Meeting:* We will hold the meeting on May 1, 2007, from 10 a.m. to 2 p.m. ADDRESSES: We will hold the meeting in Freeborn Hall on the campus of the University of California, Davis.
The university is located in the City of Davis, approximately 11 miles west of downtown Sacramento. The street address for Freeborn Hall is 104 Freeborn Hall, One Shields Ave., Davis, CA 95616. FOR FURTHER INFORMATION CONTACT: For information concerning this public meeting, please contact Mike Kangior, U.S. Department of Homeland Security, Washington, DC 20528, at 202-282-8939. SUPPLEMENTARY INFORMATION: How Are Comments Being Solicited for This Rulemaking? In addition to the public meeting on May 1, 2007, the Department of Homeland Security is soliciting comments through the following methods: • *Federal Rulemaking Portal: http://www.regulations.gov* .
Follow the instructions for submitting comments. • *Fax:* 866-466-5370. • *Mail:* Paper, disk or CD-ROM submissions can be mailed to the Department of Homeland Security, Attn: NAC 1-12037, Washington, D.C. 20538. Please include the DHS Docket Number, DHS-2006-0030 on any comments submitted to DHS. Individuals that provide comments at the public meeting may also submit comments through one of the above methods. How Can I Get Additional Information, Including Copies of This Notice or Other Related Documents? The Federal Rulemaking Portal at *www.regulations.gov* maintains the public docket for this proposed rule.
The docket number for the rule is DHS-2006-0030. Comments submitted during the public meeting, and any other documents submitted to DHS at the public meeting, including any comments that were not discussed at the meeting, will become part of this docket and will be available for inspection electronically at *http://www.regulations.gov* . Where Can I Get Information on Service for Individuals With Disabilities? To obtain information on facilities or services for individuals with disabilities or to request that we provide special assistance at the public meeting, please contact Mike Kangior as soon as possible.
You will find his address and phone number in the FOR FURTHER INFORMATION CONTACT section of this notice. Why Is the Department of Homeland Security Holding This Public Meeting? This meeting serves as an additional opportunity for members of the public to submit comments on the proposed rule to DHS for consideration as part of the final rulemaking development process. What Issues Should I Discuss at the Meeting? The public meeting on May 1, 2007 will provide a forum for members of the public to discuss various issues related to the proposed rule.
Such issues may include consumer concerns, verification, privacy/security, funding/implementation and law enforcement. For convenience to public participants who wish to attend the meeting, DHS intends to discuss these issues under the proposed agenda below. What Is the Agenda for the Public Meeting? Agenda The agenda for the meeting on May 1, 2007 is as follows: • Session I—Introduction and Overview. • Session II—Presentation and discussion of public comments. Dated: April 17, 2007.
Richard C. Barth, Assistant Secretary of Policy Development. [FR Doc. E7-7655 Filed 4-20-07; 8:45 am] BILLING CODE 4410-10-P NATIONAL CREDIT UNION ADMINISTRATION 12 CFR Part 701 RIN 3133-AD33 Member Inspection of Credit Union Books, Records, and Minutes AGENCY: National Credit Union Administration. ACTION: Proposed rule. SUMMARY: The National Credit Union Administration
(NCUA)is issuing a proposed rule on member inspection of federal credit union
(FCU)books, records, and minutes. The rule provides that a group of members representing approximately one percent of the membership, with a proper purpose and upon petition, may inspect and copy the nonconfidential portions of the credit union's books, records, and minutes. This proposal standardizes and clarifies existing member inspection rights. DATES: Comments must be received on or before June 22, 2007. ADDRESSES: You may submit comments by any of the following methods (Please send comments by one method only): • *Federal eRulemaking Portal: http://www.regulations.gov* . Follow the instructions for submitting comments. • *NCUA Web site:* *http://www.ncua.gov/RegulationsOpinionsLaws/proposed_regs/proposed_regs.html* . Follow the instructions for submitting comments. • *E-mail:* Address to *regcomments@ncua.gov.* Include “[Your name] Comments on Proposed Rule 701.3” in the e-mail subject line. • *Fax:*
(703)518-6319. Use the subject line described above for e-mail. • *Mail:* Address to Mary Rupp, Secretary of the Board, National Credit Union Administration, 1775 Duke Street, Alexandria, Virginia 22314-3428. • *Hand Delivery/Courier:* Same as mail address. FOR FURTHER INFORMATION CONTACT: Paul Peterson or Annette Tapia, Staff Attorneys, at the above address or telephone number
(703)518-6540. SUPPLEMENTARY INFORMATION: A. Background This proposed rule provides that a group of members representing approximately one percent of an FCU's membership, upon petition and with a proper purpose, may obtain access to the nonconfidential portions of the FCU's books, records, and minutes. FCUs are not-for-profit, member-owned cooperatives organized to provide financial services and products to their members. The financial interests of members in their credit union are similar to the financial interests shareholders have in for-profit corporations. Corporate shareholders have various methods to protect their financial interests in the corporation, including the right at common law and in various state statutes to inspect corporate books and records. Because of the similarity of interests between credit union members and corporate shareholders, NCUA legal opinions going back many years have stated that FCU members may inspect the FCU's books and records under the same terms and conditions that state corporation law where the FCU is located permits shareholder inspection of corporate records. *See,* *e.g.* , OGC Ops. 92-0101, 96-0451, and 06-0127B. These opinion letters are available at *http://www.ncua.gov* . The NCUA Board believes regulating member inspection of FCU records is preferable to reliance on state corporation law. Corporation law on shareholder inspection, for example, varies from state to state, and FCUs should have a consistent standard regardless of an FCU's location. Some FCUs have branches in multiple states, further complicating the application of state law to inspection requests. In addition, some courts may refuse to apply their corporation law to inspection requests by FCU members or may incorrectly analogize the financial interests of credit union members to those of depositors in a mutual savings bank and deny members inspection on those grounds. * See,* *e.g.* , *Save Columbia Credit Union Committee* v. *Columbia Credit Union,* 139 P.3d 386, 393-95 (Wash. App. 2006) (refusing to apply state corporation law to records inspection request by members of a state-chartered credit union). The Board considered when and why members might want to inspect FCU records. The law charges members with responsibility for important decisions that affect both the FCU and the members' financial interests. For example, a vote of the FCU's members is required on the election and removal of directors, mergers, conversion from federal to private account insurance, conversion from a federal to state charter or conversion to a mutual savings bank, and voluntary liquidations. In these situations, members may want to inspect FCU records to better inform themselves before voting and to ensure that directors are acting in the best interests of the members. There are other situations where the members want to inspect records to protect their financial interests, as discussed further below. The Board also considered how stakeholders of depository institutions other than credit unions may inspect their institution's books and records. The Board identified an existing Office of Thrift Supervision
(OTS)rule governing the right of shareholders to inspect the books, records, and minutes of federal stock savings associations. 12 CFR 552.11 (OTS Rule). The ownership interests of members in an FCU are similar to the ownership interests of stockholders in a stock savings association; the issues on which FCU members and stock bank shareholders vote are similar; and the regulatory and supervisory powers of NCUA and OTS over their respective regulated institutions are also similar. Accordingly, this proposed rule tracks, in large part, the OTS Rule. The proposal is also consistent with existing NCUA guidance on member inspection of FCU records. *See* FCU Handbook (Rev. 2006), p.68. B. Paragraph-by-Paragraph Analysis
(a)Member Inspection Rights Proposed paragraph
(a)establishes the right of a group of members of an FCU, upon submission of a proper petition, to inspect and copy the credit union's books and records of account and minutes of the proceedings of the credit union's members, board of directors, and committees of directors. This inspection right is similar to that in the OTS Rule, with the use of a member petition in lieu of the stockholder affidavit requirement in the OTS Rule. The member petition must meet the requirements in proposed paragraph (b). Also, inspection rights are limited to the nonconfidential portions of the credit union's books, records, and minutes. Proposed paragraph
(d)defines confidential books, records, and minutes; all other books, records, and minutes are nonconfidential. Minutes The Board intends the phrase “minutes of the proceedings at all meetings of its members, board of directors, and committees of directors” to include any summary or recording of the proceedings and all documents, reports, studies, and visual aids considered by the meeting participants. The Board believes this broad interpretation of minutes is appropriate. For example, in situations where an FCU membership vote is required, the vote is either about the election or removal of directors or officers or is precipitated by the actions of the directors as in the case of a merger or conversion. Members should have access to the directors' deliberations to help members decide how to vote and help members determine if the directors are acting in the members' best interests. Books and Records of Account Courts have interpreted the phrase “books and records of account” differently. Some courts have interpreted the phrase broadly to include both financial and nonfinancial records while other courts have interpreted the phrase to include only financial records. *See, e.g.* , *Meyer* v. *Ford Industries, Inc.* , 538 P.2d 353, 358 (Or. 1975) (broad interpretation); *Corwin* v. *Abbott Laboratories* , 819 N.E.2d 1249 (Ill. App. 2004), *app. den.* 2005 Ill. LEXIS 609 (Ill. 2005) (phrase includes both financial and nonfinancial records); and *Jewelers International Showcase, Inc.* v. *Mandell* , 529 So. 2d 1211 (Fla. Dist. Ct App. 3d Dist. 1988) (stockholder was entitled to inspect financial records such as general ledger, balance sheets, and profit and loss statements). The NCUA Board believes a narrow interpretation is best. The plain language meaning of “of account” supports a limitation to accounting records. Stockholder inspection of corporate records under the Model Business Corporation Act
(MBCA)is expressly limited to minutes and “accounting records,” and the Counsel to the Federal Home Loan Bank Board (FHLBB), in interpreting the predecessor to the OTS rule, has cited to the MBCA as authority for the OTS rule. Letter from Julie Williams, FHLBB Deputy General Counsel, dated September 17, 1986, located at 1986 FHLBB LEXIS 82 ( *hereinafter* 1986 FHLBB DGC Letter); and Model Bus. Corp. Act § 16.02(b)(2)(1984). The Board believes the financial interests of members are adequately protected by combining a broad interpretation of minutes with a more restrictive interpretation of the phrase books and records of account. Inspection and Copying Generally, a member's right to inspect FCU minutes and records includes the right to make copies of those records. Obtaining copies enables members to provide the information to other members or, in some cases, to experts for independent analysis and review. If an FCU believes that certain of its records should not be copied, it may request that the regional director impose conditions on the inspection, as discussed further below.
(b)Petition for Inspection Proposed paragraph
(b)establishes the member petition requirements. The petition must describe the particular records to be inspected and state a purpose for the inspection related to the business of the credit union. The petition must state that the petitioners as a whole, or certain named petitioners, agree to pay the direct and reasonable costs associated with search and duplication of requested material. The petition must also state that the inspection is not desired for any purpose in the interest of a business or object other than the business of the credit union; that the members signing the petition have not within five years preceding the signature date sold or offered for sale, and do not now intend to sell or offer for sale, any information obtained from the credit union; and that the members signing the petition have not within the past five years aided or abetted any other person in procuring any information from the credit union for purposes of sale. The petition must name one or more members who will represent the petitioners on issues such as inspection procedures, costs, and potential disputes. At least one percent of the credit union's members, with a minimum of 20 members and a maximum of 250 members, must sign the petition. The language of this proposed paragraph is similar to language in paragraphs
(b)and
(c)of the OTS Rule. Minimum Signature Requirement The OTS Rule requires stockholders seeking records to own a certain number of shares and to submit an affidavit describing their request to the savings association. For shareholders who have owned their shares at least six months, the affidavit generally must be signed by shareholders representing at least one percent of the outstanding shares. OTS Rule, paragraphs (b)(1) and (2). The proposal substitutes a member petition for this stockholder affidavit. The petition also employs a minimum signature requirement of one percent of the members, representing an ownership interest roughly equivalent to one percent of the shares of a stock association. The proposed rule further provides that a minimum of 20 members and a maximum of 250 must sign the petition. The one percent and minimum and maximum signature requirements are similar to those established in NCUA's standard FCU bylaws for members seeking a nomination by petition to run for election to an FCU's board of directors. NCUA Standard FCU Bylaws, Art. V, Sec. 1 (Rev. April 2006). Proper Purpose The purpose of an inspection must be related to the business of the credit union. A proper purpose includes attempting to ascertain and protect members' financial interests and to ascertain possible mismanagement. * See, e.g.* , 1986 FHLBB DGC Letter (interpreting OTS Rule). The issue of member inspection of records may arise, for example, in the context of a member vote on merger or charter conversion. Members of a merging or converting credit union may desire access to the due diligence performed by their directors, and other credit union books and records, to determine if the directors are acting in the members' best interests. Members of a credit union merging with another credit union may also have an interest in determining if they are receiving an appropriate share adjustment. 12 CFR 708b.103(a)(5). Members may have a financial interest in ascertaining how the proposed merger or conversion will affect their services, rates, and fees and how the directors analyzed this issue. Members of a credit union merging with a bank may have a further interest in determining the value of their shares plus any associated premium and whether the directors carefully considered all the available merger opportunities with a view to maximizing the financial benefit to the members. Members of a credit union converting to a bank may also want to know if their directors considered the possibility of a merger and appropriate payments to members. Members may wish to obtain FCU records in other contexts. For example, some members might want records about FCU decisions that have a direct effect on the members, such as a determination to close a branch office or to discontinue a service or product. Members electing directors might want records from the credit union about the qualifications of and benefits received by sitting directors. Members might also want records about the qualifications and compensation of senior management. Burden of Proof on Proper Purpose Generally, in the absence of evidence indicating an improper purpose, courts do not assume that stockholders of a corporation requesting an inspection intend to use the information improperly just because it would be possible for them to do so. *Fears* v. *Cattlemen's Inv. Co.* , 483 P.2d 724, 730 (Okla. 1971). The requirement in the proposed rule that petitioners state they are not intending to sell the information, nor have they aided or abetted such sales in the past five years, helps ensure a proper purpose. The minimum signature requirement in the proposal also helps ensure a proper purpose because members seeking signatures will have to convince other members that they share a common and appropriate purpose. Accordingly, a petition meeting the requirements of paragraph
(c)creates a presumption of proper purpose, and an FCU should have substantial evidence of improper purpose to deny inspection for that reason. Description of Records The petition must describe the particular records sought and the description must be specific enough to allow the FCU to identify responsive records. The FCU may ask the petitioners for more information if necessary to help understand the scope of the request.
(c)Inspection Procedures Proposed paragraph
(b)provides the inspection procedures. Within 14 days of receipt of a petition, the FCU must either allow inspection and copying of all requested material or inform the petitioning members in writing why it is not able to do so. Inspection may be in person or by an agent or attorney and at any reasonable time or times. Member inspection rights under this paragraph are in addition to any other member inspection rights afforded by law, regulation, or the credit union's bylaws. Unless a regional director imposes conditions on a particular request for records, the member's right to inspect records includes the right to make copies. In many cases, the credit union will mail or deliver copies of the requested documents to the individual(s) designated by the petitioners. In some cases, however, the petitioners may request an inspection of requested documents at the credit union before copies are made or the credit union may ask the petitioners to come to the credit union to pick up the copies. The Board recognizes original documents may be at a credit union office some distance from where the petitioners live and that conducting an on-site inspection or pick-up may be difficult or expensive for petitioners. The Board expects credit unions and petitioners to work out reasonable, mutually acceptable arrangements for on-site inspection or pick-up, including, for example, movement of documents or copies to a credit union branch location convenient to petitioners. The language of this paragraph is similar to language in paragraph
(b)of the OTS Rule. The proposed 14-day compliance timeframe, not found in the OTS Rule, will ensure that an FCU responds promptly to the member petition. The proposed paragraph also recognizes that members may have additional inspection rights, including, for example, inspection rights related to merger compensation in another pending NCUA rulemaking.
(d)Confidential Books, Records, and Minutes Proposed paragraph
(d)provides that members do not have the right to inspect portions of the books, records, or minutes of an FCU under certain circumstances: first, if federal law or regulation prohibits disclosure of that portion; second, if that portion contains nonpublic personal information; and, third, if that portion contains information about credit union employees or officials the release of which would constitute an unwarranted invasion of personal privacy. Federal Law or Regulation Prohibits Disclosure The provision prohibits credit unions, for example, from disclosing nonpublic records generated by NCUA, including reports of inspection that might otherwise be considered by the FCU's board of directors and included within its meeting minutes. 12 CFR 792.40, 792.49. Nonpublic Personal Information The members of a credit union are both its customers and its owners, and the credit union maintains sensitive personal and financial information about members that must be protected. The OTS Rule protects the privacy of a bank's customers by providing that no stockholder may inspect any list of depositors or borrowers or their addresses, deposit, or loan records or any data from which that information can be constructed. The proposed rule provides similar protection for the personal and financial information of a credit union's members, but instead of a reference to specific sensitive information as in the OTS Rule, the proposal will protect all nonpublic personal information as that term is defined in NCUA's rules on the privacy of consumer financial information. 12 CFR part 716. Nonpublic personal information includes information such as the fact an individual is a member, account numbers and balances, transaction information, consumer reports, and any information provided by the member to obtain a financial product from the credit union. 12 CFR 716(r). Information that is publicly available or information that does not identify a particular member would not be nonpublic personal information. 12 CFR 716(q). Information About Credit Union Employees or Officials The proposed rule also protects from inspection information about the FCU's employees and officials if disclosure would constitute a clearly unwarranted invasion of personal privacy. This terminology is similar to the confidentiality provision in the Freedom of Information Act. 5 U.S.C. 552(b)(6). Some categories of information that will receive confidentiality treatment include marital status, financial status, children, medical conditions, dates of birth, religious affiliations, citizenship data, sexual inclinations, and social security numbers. *See Freedom of Information Act Guide and Privacy Act Overview* , U.S. Department of Justice (May 2004 ed.). As an exception to this confidentiality provision, FCU members may inspect materials describing the compensation and benefits provided to senior executive officers. The member-owners of a credit union have a financial interest in how their credit union is managed, and that interest extends to knowledge about who the senior managers are, their qualifications, and their compensation levels. The members' interest in this information outweighs any privacy interests the senior managers may have in the information. Accordingly, the rule provides that members may inspect information about the qualifications, compensation and benefits of senior executive officers, as defined in § 701.14 of NCUA's rules: Senior executive officer means a credit union's chief executive officer (typically this individual holds the title of president or treasurer/manager), any assistant chief executive officer (e.g., any assistant president, any vice president or any assistant treasurer/ manager), and the chief financial officer (controller). The term “senior executive officer” also includes employees of an entity, such as a consulting firm, hired to perform the functions of positions covered by the regulation. 12 CFR 701.14(b)(2). Other Considerations This proposal provides confidentiality only for materials the release of which is prohibited by federal law, materials that contain nonpublic personal information, and personal information about FCU employees and officials. In some states, courts have withheld other types of documents from shareholder inspection, such as confidential internal correspondence or materials containing corporate trade secrets. *See, e.g., Morton* v. *Rodgers* , 20 Ariz. App. 581, 514, P.2d 752 (Ariz. Div. 1, 1973) (trade secrets); *State Ex. Rel. Armour & Co* . v. *Gulf Sulphur Corp.* , 231, A.2d 470 (Del. 1967) (trade secrets); and *State ex rel. Jones* v. *Ralston Purina Co.* , 358 S.W.2d 772, 778 (Mo. 1962) (internal correspondence). As one court noted, however: Both under the common law and under our statute a stockholder of a corporation is entitled to examine the books and records of the corporation * * *. The right rests upon the proposition that, while the corporation holds the legal title to its property, the stockholders are deemed to be the real and beneficial owners thereof and, as such, are entitled to information concerning the management of the property and business which they have confided to the officers and directors of the corporation as their agents * * *. It ordinarily is not enough to deny the right that the information sought is of a confidential nature. *Nationwide Corp.* v. *Northwestern National Life Insurance Co.* , 251 Minn. 255, 256; 87 N.W.2d 671, 672 (Minn. 1958). This proposal, like the OTS Rule, has no confidentiality provisions related to internal memoranda or trade secrets for several reasons. First, credit unions do not generally have trade secrets, that is, secret formulas or technology on which the success of the organization is dependent, and cases that deal with confidential internal correspondence generally do not provide a standard by which confidentiality can be measured. Second, it is unlikely that, given the narrow interpretation of “books and records of account” intended by the Board, any materials deserving of confidentiality would appear among those materials subject to inspection. Third, even if confidential materials appear among the materials subject to this rule, requested materials must be relevant to the petitioners' stated business purpose before they become subject to inspection. *See, e.g., Azzar* v. *Primebank Federal Savings Bank* , 499 N.W.2d 793, 798 (Ct. App. Mich. 1993)(interpreting the OTS Rule). Finally, and as discussed above, if a credit union has substantial evidence of an improper purpose, it may deny inspection for that reason. In the unlikely event there are portions of relevant FCU books and records of account or minutes the public release of which might cause the credit union substantial competitive injury or financial damage, the dispute resolution paragraph of the proposed rule permits the regional director to place conditions on member inspection that balance the interests of the member-owners in the requested information against any interests the credit union may have in maintaining confidentiality. The regional director's authority to resolve disputes is discussed further below. The NCUA Board also considered if privileged information, that is, exempt from discovery in court cases, should be withheld from members. Case law on the corporate shareholder's right to inspect privileged information differs by jurisdiction. In California, for example, shareholders lack the right to inspect corporate books and records covered by the attorney-client privilege. *National Football League Properties, Inc.* v. *Oakland Raiders* , 75 Cal. Rptr. 2d 893 (Ca. Ct. App. 6th District 1998). In other jurisdictions, however, shareholders who are concerned with corporate mismanagement may inspect attorney-client privileged documents. *Beard* v. *Ames* , 168 A2d 119 (N.Y. 1983); *Garner* v. *Wolfinbarger* , 430 F.2d 1093 (5th Cir. 1970). For example, in determining that stockholders could inspect communications between attorney and corporate management under some circumstances, the *Garner* court stated: But in assessing management assertions of injury to the corporation it must be borne in mind that management does not manage for itself and that the beneficiaries of its action are the stockholders. Conceptualistic phrases describing the corporation as an entity separate from its stockholders are not useful tools of analysis. They serve only to obscure the fact that management has duties which run to the benefit ultimately of the stockholders. *Id.* at 1101. The Board believes member-owners with a proper purpose should have access to relevant FCU information. Accordingly, and like the OTS Rule, this proposal does not include confidentiality protection for privileged information, but that does not mean that privileged material will automatically be subject to inspection. Privileged material would have to be the subject of a proper petition with a valid purpose; it would have to fall within the scope of “books and records of account” or “minutes;” and it would have to be relevant to the petitioners” stated purpose, all before it would be subject to inspection. Proposed paragraph
(f)also provides regional directors with authority to resolve disputes, and a regional director could place conditions on the release of the privileged material where appropriate. The FCU may have other minutes or books and records of account that it has designated as confidential by policy or otherwise. That designation by an FCU does not defeat the inspection rights of members. If the requested material does not contain confidential information as described in § 701.3(d), the member-owners have the right to inspect it upon a proper petition. Again, as discussed below, a regional director may impose conditions on inspection and copying in appropriate cases. In some cases, materials requested by members may include a mix of both confidential portions and nonconfidential portions. An FCU must make as much of the nonconfidential material available to members as possible, redacting or withholding only the confidential portions.
(e)Costs Proposed paragraph
(e)states that an FCU may charge petitioners the direct and reasonable costs associated with search and duplication but it may not charge for other costs, including indirect costs or attorney's fees. While the OTS Rule does not specifically address the reimbursement for costs of shareholder inspection and copying of stock savings association records, an OTS legal opinion describes that reimbursement: In our view, a federal stock association may charge a requesting Qualifying Shareholder reasonable expenses for document searches, duplication, and direct costs associated with producing and delivering documents. However, a requesting Qualifying Shareholder is not obligated to pay the association's attorneys fees in order to gain access to review the association's books and records required to be made available to shareholders under section 552.11. Letter from Harris Weinstein, OTS Chief Counsel, dated December 5, 1991 (1991 OTS LEXIS 68). The proposed paragraph
(e)addresses costs in a manner similar to that described in OTS legal opinions. Typically, the direct costs of search and duplication would include only the number of hours a clerk might take to locate and duplicate the requested documents multiplied by the clerk's hourly compensation rate, plus the per-page costs of duplication. Requesters need not reimburse the credit union for other costs, including costs associated with the management or supervision of the person(s) conducting the search, costs to review documents, costs associated with in-person inspection of records, overhead costs, or the costs of any legal services. As noted above, the petition must recognize the obligation of the petitioners as a whole, or certain named petitioners, to pay the direct and reasonable costs associated with search and duplication. Petitioners may also include in the petition, if they want, a maximum amount that they are willing to pay; and the FCU, if it wants, may provide petitioners with an estimate of the search and duplication costs. The rule does not require, however, that petitioners pay in advance, or agree to pay any specific amount, before the FCU provides the petitioners with the requested documents.
(f)Dispute Resolution Proposed paragraph
(f)provides, in the event of a dispute between an FCU and its members concerning a petition for inspection or the associated costs, either party may submit the dispute to the regional director. The regional director, after obtaining the views of both parties, will direct the credit union either to withhold the disputed materials or to make them available for member inspection and copying. The regional director may place conditions upon release, if appropriate. Depending on the circumstances, conditions imposed by the regional director might include limitations on making copies or a requirement that the parties enter into a contract restricting the use or further dissemination of the material. The OTS Rule does not contain a dispute resolution procedure. The NCUA Board believes that a dispute resolution procedure is necessary to protect both the inspection rights of members and the FCU's interests. In other circumstances involving member disputes with FCUs, NCUA usually refers the dispute to the FCU's supervisory committee for resolution. The proposed rule does not require such referral because, in certain circumstances, such as a pending member vote on a charter or share insurance conversion or a merger, members' need for the information may be time sensitive. Still, in the event of a dispute over access to FCU records, petitioners, if they desire, may contact an FCU's supervisory committee before taking it directly to the regional director. Similarly, if a regional director receives a request from a petitioner for dispute resolution and determines that resolution is not time sensitive, the director may refer the matter to the FCU's supervisory committee for analysis and response before the director makes any decision about the dispute. The NCUA Board does not believe that specific time frames for regional director action are appropriate. The time needed for dispute resolution could vary significantly from case to case depending on the complexity of the dispute. In addition, the Board does not believe a right to appeal to the Board is necessary. C. Request for Public Comment NCUA's goal is to promulgate clear and understandable regulations that impose minimal regulatory burden. The Board requests public comments on whether the proposed rule is understandable and minimally intrusive and also solicits specific suggestions to improve the content of the rule. D. Regulatory Procedures Regulatory Flexibility Act The Regulatory Flexibility Act requires NCUA to prepare an analysis to describe any significant economic impact a rule may have on a substantial number of small credit unions, defined as those under ten million dollars in assets. This proposed rule standardizes and clarifies the rights of members to inspect FCU records. The rule is not a significant departure from existing practice that FCUs must permit inspection under the same terms and conditions that state law requires for shareholders to inspect corporation records. The proposed rule requires that a minimum of one percent of the FCU's members sign a petition to obtain access. In some states, this burden on the members might exceed the burden on shareholders to obtain access and so reduces the likelihood of an FCU having to grant access. Accordingly, the Board does not anticipate that the proposed rule, if adopted, would have a significant economic impact on a substantial number of small credit unions. Paperwork Reduction Act Section 701.3 contains information collection requirements. As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), NCUA is submitting a copy of this proposed regulation as part of an information collection package to the Office of Management and Budget
(OMB)for its review and approval of a new collection of information. The proposed rule standardizes and clarifies the circumstances and conditions under which FCU members may inspect and copy an FCU's books, records of accounts, and minutes of meetings. The FCU must permit inspection of relevant records if it receives a member petition stating a proper purpose for inspection and signed by at least one percent of members, with a minimum of five and a maximum of 250. NCUA does not believe members will use this petition authority often. NCUA estimates that there will be, perhaps, five such petitions per year. NCUA also estimates it will take an FCU that receives a petition approximately 20 hours to evaluate the petition, locate relevant documents, and make them available for inspection and copying. Five petitions times 20 hours per petition equals 100 annual burden hours associated with this proposed collection of information. The Board also notes that the costs of document search and duplication will fall on the petitioners and not on the FCU. Organizations and individuals that wish to submit comments on this information collection requirement should direct them to the Office of Information and Regulatory Affairs, OMB, Attn: Mark Menchik, Room 10226, New Executive Office Building, Washington, DC 20503, with a copy to Mary Rupp, Secretary of the Board, National Credit Union Administration, 1775 Duke Street, Alexandria, Virginia 22314-3428. The NCUA considers comments by the public on this proposed collection of information in: • Evaluating whether the proposed collection of information is necessary for the proper performance of the functions of the NCUA, including whether the information will have a practical use; • Evaluating the accuracy of the NCUA's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; • Enhancing the quality, usefulness, and clarity of the information to be collected; and • Minimizing the burden of collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology; *e.g.* , permitting electronic submission of responses. The Paperwork Reduction Act requires OMB to make a decision concerning the collection of information contained in the proposed regulation between 30 and 60 days after publication of this document in the **Federal Register** . Therefore, a comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication. This does not affect the deadline for the public to comment to the NCUA on the proposed regulation. Executive Order 13132 Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. In adherence to fundamental federalism principles, NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order. The proposed rule would not have substantial direct effects on the states, on the connection between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. NCUA has determined that this proposed rule does not constitute a policy that has federalism implications for purposes of the executive order. The Treasury and General Government Appropriations Act, 1999—Assessment of Federal Regulations and Policies on Families The NCUA has determined that this proposed rule would not affect family well-being within the meaning of section 654 of the Treasury and General Government Appropriations Act, 1999, Pub. L. 105-277, 112 Stat. 2681 (1998). List of Subjects in 12 CFR Part 701 Credit unions, Records. By the National Credit Union Administration Board on April 12, 2007. Mary F. Rupp, Secretary of the Board. Accordingly, NCUA proposes to amend 12 CFR part 701 as follows: PART 701—ORGANIZATION AND OPERATIONS OF FEDERAL CREDIT UNIONS 1. The authority citation for part 701 continues to read as follows: Authority: 12 U.S.C. 1752(5), 1755, 1756, 1757, 1759, 1761a, 1761b, 1766, 1767, 1782, 1784, 1787, 1789. Section 701.6 is also authorized by 15 U.S.C. 3717. Section 701.31 is also authorized by 15 U.S.C. 1601 *et seq.* ; 42 U.S.C. 1981 and 3601-3610. Section 701.35 is also authorized by 42 U.S.C. 4311-4312. 2. Add § 701.3 to read as follows: § 701.3 Member inspection of credit union books, records, and minutes.
(a)*Member inspection rights.* A group of members of a federal credit union has the right, upon submission of a petition to the credit union as described in paragraph
(b)of this section, to inspect and copy nonconfidential portions of the credit union's:
(1)Books and records of account; and
(2)Minutes of the proceedings of the credit union's members, board of directors, and committees of directors.
(b)*Petition for inspection.* The petition must describe the particular records to be inspected and state a purpose for the inspection related to the business of the credit union. The petition must state that the petitioners as a whole, or certain named petitioners, agree to pay the direct and reasonable costs associated with search and duplication of requested material. The petition must also state that the inspection is not desired for any purpose in the interest of a business or object other than the business of the credit union; that the members signing the petition have not within five years preceding the signature date sold or offered for sale, and do not now intend to sell or offer for sale, any information obtained from the credit union; and that the members signing the petition have not within the past five years aided or abetted any other person in procuring any information from the credit union for purposes of sale. The petition must name one or more members who will represent the petitioners on issues such as inspection procedures, costs, and potential disputes. At least one percent of the credit union's members, with a minimum of 20 members and a maximum of 250 members, must sign the petition.
(c)*Inspection procedures.* Within 14 days of receipt of a petition, the federal credit union must either allow inspection and copying of all requested material or inform the petitioning members in writing why it is not able to do so. Inspection may be made in person or by agent or attorney and at any reasonable time or times. Member inspection rights under this paragraph are in addition to any other member inspection rights afforded by law, regulation, or the credit union's bylaws.
(d)*Confidential books, records, and minutes.* Members do not have the right to inspect any portion of the books, records, or minutes of a federal credit union if:
(1)Federal law or regulation prohibits disclosure of that portion,
(2)The portion contains nonpublic personal information as defined in § 716.4 of this part; or
(3)The portion contains information about credit union employees or officials the disclosure of which would constitute a clearly unwarranted invasion of personal privacy. Members may, however, inspect materials describing the compensation and benefits provided by the credit union to its senior executive officers, and the qualifications of the senior executive officers, as that term is defined in § 701.14 of this part.
(e)*Costs.* A federal credit union may charge petitioners the direct and reasonable costs associated with search and duplication. The credit union may not charge for other costs, including indirect costs or attorney's fees.
(f)*Dispute resolution.* In the event of a dispute between a federal credit union and its members concerning a petition for inspection or the associated costs, either party may submit the dispute to the regional director. The regional director, after obtaining the views of both parties, will direct the credit union either to withhold the disputed materials or to make them available for member inspection and copying. The regional director may place conditions upon release, if appropriate. The decision of the regional director is a final agency decision and is not appealable to the Board. [FR Doc. E7-7610 Filed 4-20-07; 8:45 am] BILLING CODE 7535-01-P NATIONAL CREDIT UNION ADMINISTRATION 12 CFR Part 708b Disclosure of Merger Related Compensation Arrangements AGENCY: National Credit Union Administration (NCUA). ACTION: Proposed rule with request for comments. SUMMARY: NCUA is issuing a proposed rule on mergers to require all federally insured credit unions to include in the merger plan submitted to NCUA a description of any arrangements providing a material increase in compensation or benefits to senior management officials in connection with the merger. The proposed rule also requires federal credit unions to disclose the existence of such compensation arrangements in the materials provided to members voting on whether to approve the merger. The proposed rule will ensure members of a merging federal credit union and NCUA are fully informed about arrangements providing for a material increase in compensation or benefits to senior management officials before considering whether to approve the merger. NCUA believes this requirement will assure merger decisions are based on the best interests of the members. DATES: Comments must be received on or before June 22, 2007. ADDRESSES: You may submit comments by any of the following methods (Please send comments by one method only): • *Federal eRulemaking Portal: http://www.regulations.gov.* Follow the instructions for submitting comments. • *NCUA Web site: http://www.ncua.gov/news/proposed_regs/proposed_regs.html.* Follow the instructions for submitting comments. • *E-mail:* Address to *regcomments@ncua.gov* . Include “[Your name] Comments on Proposed Rule Part 708b (Disclosure of Merger Related Compensation)” in the e-mail subject line. • *Fax:*
(703)518-6319. Use the subject line described above for e-mail. • *Mail:* Address to Mary Rupp, Secretary of the Board, National Credit Union Administration, 1775 Duke Street, Alexandria, Virginia 22314-3428. • *Hand Delivery/Courier:* Same as mail address. FOR FURTHER INFORMATION CONTACT: Ross Kendall, Staff Attorney, Office of General Counsel, at the above address or telephone:
(703)518-6540. SUPPLEMENTARY INFORMATION: A. Background The Federal Credit Union Act
(Act)authorizes the NCUA Board to prescribe rules regarding mergers of federally-insured credit unions and changes in insured status and requires written approval of the Board before one or more federally-insured credit unions merge. 12 U.S.C. 1766(a), 1785(b), 1785(c), 1789(a). Part 708b of NCUA's rules implements this authority and applies to both corporate credit union and natural person credit unions. 12 CFR part 708b. The rule provides for NCUA review and approval of any merger involving a federally-insured credit union. 12 CFR 708b.104(a). Where a merging credit union is a federal credit union, members have the right to vote on whether to approve the merger, subject to one exception; NCUA may permit a merger without a member vote if it determines the FCU is in danger of insolvency and a merger will protect the National Credit Union Share Insurance Fund. 12 CFR 708b.106, 708b.105(b). As with any maturing industry, consolidation in the nation's credit unions is occurring and is expected to continue. Efforts to increase efficiencies through improved economies of scale, along with improvements in information technology and the increasing costs associated with compliance, all contribute to the trend toward consolidation. The increasingly competitive marketplace for financial services in which credit unions operate adds additional pressure to consolidate. Most of this consolidation is occurring through voluntary mergers of credit unions. With the increase in merger activity, some credit unions may find themselves in the position of being a potential merger partner with more than one other credit union. In this position, management of the credit union will naturally want to evaluate competing opportunities and should consider which of the potential merger partners offers the best fit, in terms of member philosophy and continued or expanded services and products for its membership. B. Proposed Rule The NCUA Board is concerned that prospective merger partners may seek to improperly influence the outcome of deliberations by a board of directors of the merging credit union. The support of senior management officials of a credit union considered for merger may influence a decision to approve a merger plan with a particular merger partner. Thus, a potential merger partner might agree to provide financial incentives in exchange for support from senior management. This proposed rule would require all federally-insured credit unions to describe any financial arrangements providing a material increase in compensation or benefit to a senior management official in the merger plan submitted to the NCUA. For purposes of the disclosure requirement, the proposal defines a material increase as an increase of 15% above the official's current compensation or $10,000, whichever is greater. Compensation includes salary as well as any indirect compensation such as bonus, deferred compensation or other financial reward. NCUA would determine, on a case by case basis, whether to request further details about an arrangement in connection with its review of the merger plan. Where a merging credit union is federally chartered, the proposal would also require disclosure of the existence of a material increase in compensation to its members before their vote on the merger. State law governs whether members of a state-chartered credit union are entitled to vote; therefore, NCUA is only proposing this requirement for federal credit unions. Any individual member of a federal credit union wishing to review the details of the arrangement would be entitled to inspect the credit union's records detailing the arrangement. The inspection would be at an office of the credit union during regular business hours and a member requesting it would need to submit a request in writing to the credit union at least one day before the date announced for the meeting called for the purpose of voting on the merger. NCUA notes that the proposed creation of a member inspection right in the context of merger related compensation arrangements is specific to these limited circumstances. Simultaneously with the adoption of this proposal, NCUA is also proposing a broader, more general rule to govern member access to federal credit union records. In accordance with settled rules of construction, a more specific provision in a rule takes precedence over a broader provision of general applicability. Norman j. Singer, statutes and statutory construction, § 51.05 (6th Ed., 2000). Thus, a member asserting a right to review documents relating to merger related compensation would be entitled to follow the procedures outlined in this rule and not the general procedures relating to member access to records. The proposed rule would permit a member to review merger related compensation records without making or retaining copies at “an” office of the credit union, including branch office locations. The Board recognizes that requested documents may be at a credit union office at some distance from where members may live and that conducting a review may be difficult or expensive for members. The Board expects credit unions and their members to work out reasonable arrangements about how a review can take place that are mutually acceptable. For example, a credit union may agree to provide photocopies to a branch office location convenient to the member. The Board solicits comment on this subject. The NCUA Board believes this proposed rule will help assure that management's decision to recommend a merger is based on sound business judgment reflecting the best interests of the members. The Board also notes the proposal tracks an Office of Thrift Supervision
(OTS)regulation that requires disclosure of officer compensation, among other matters, in a merging thrift's merger approval application; the OTS rule states an increase in compensation paid to an officer, director or controlling person of a merging federal thrift or savings bank is presumed to be unreasonable and a sale of control if it exceeds the greater of 15% or $10,000. 12 CFR 563.22(d)(1)(vi)(C). The Board also notes comparable disclosure requirements relating to economic benefits for directors and senior management officials are in NCUA's rule on conversions of insured credit unions to mutual savings banks. 12 CFR 708a.4(d)(1)(iii). The proposed rule addresses arrangements providing material economic benefits to board members or senior management officials of the merging credit union. The NCUA Board believes these individuals are most likely to be in a position to negotiate personally advantageous compensation arrangements. The Board also understands retention agreements and bonuses for persons holding managerial or technical positions may be essential for a successful merger, and the proposed rule does not prohibit offering retention agreements or bonuses that a continuing credit union believes are appropriate, including arrangements affecting senior management officials. In this respect, the Board notes it does not intend to substitute its business judgment for that of the boards of the merging and continuing credit unions on marketplace demands and reasonable compensation arrangements. The proposed rule change focuses on transparency and the principle that full disclosure usually results in more informed and better membership decisions. The Board recognizes that, in some cases, officials of the merging credit union may be retained by the continuing credit union and assigned additional duties with greater responsibilities. In those cases, the continuing credit union may offer to pay officials relatively greater compensation than they earned with the merging credit union. Credit unions should be able to support these types of increases in compensation, bonuses, or retention agreements in the required disclosures. The proposed rule would simply require a description of these arrangements in the merger plan and, in the case of a merging federal credit union, disclosure of their existence to the membership before their vote on approving the merger. State law governs whether members of a merging state chartered credit union are entitled to vote on a proposed merger. If a state law requires a state supervisory authority's approval, NCUA's rule requires evidence that the state supervisory authority has approved the merger as part of the material submitted to the appropriate Regional Director. 12 CFR 708b.104(a)(6). For corporate credit unions, the NCUA Merger and Conversion Manual specifies that credit unions submit their merger requests to NCUA's Office of Corporate Credit Unions. NCUA 8056/M 6300 (June 2005). C. Proposed Amendments *Definitions.* The proposal adds two new definitions to the rule. “Merger related financial arrangement” is defined to mean an increase in direct or indirect compensation of 15% or $10,000, whichever is greater, that any board member or senior management official of a merging credit union may receive in connection with a merger transaction. Such an increase is considered material and would need to be disclosed. The term does not include an agreement to retain a senior management official in a comparable managerial role with the continuing credit union, so long as the agreement is limited to retention and does not include any financial component resulting in a material increase, as defined, above the official's existing compensation package. The second new definition, “senior management official,” includes the chief executive officer (who may hold the title of president or treasurer/manager), any assistant chief executive officer, and the chief financial officer. This definition conforms to other NCUA rules affecting members of senior management of credit unions; *see,* e.g., 12 CFR part 703. *Disclosures.* The proposed rule would add to the rule's provisions describing the merger plan and the approval of the merger proposal by members of the merging credit union. 12 CFR 708b.103(a), 106(a)(2). The new provisions require financial arrangements providing a material increase in compensation or benefits for senior management officials and related to a merger to be described in the merger plan and, in the case of a merging federal credit union, disclosed to the membership in the balloting materials. These disclosure obligations would only be triggered where the proposed financial arrangement results in an increase in compensation equal to 15% or $10,000, whichever is greater. Furthermore, the rule would simply require that the disclosure to the members indicate the existence of a material financial arrangement involving one or more senior management officials. Any individual member would be entitled to inspect the credit union's records pertaining to the arrangement, at the credit union's office during business hours. Regulatory Procedures Regulatory Flexibility Act The Regulatory Flexibility Act requires NCUA to prepare an analysis to describe any significant economic impact a proposed rule may have on a substantial number of small credit unions (those under ten million dollars in assets). Most of the mergers of federal credit unions involve small credit unions. In almost all cases, the small credit union merges into a much larger continuing credit union. The larger credit union is available to assist the small credit union with each step in the merger process, keeping the economic impact on the small credit union to a minimum. Accordingly, the Board does not anticipate that this proposed rule would have a significant economic impact on a substantial number of small credit unions, and, therefore, a regulatory flexibility analysis is not required. Paperwork Reduction Act The proposed changes to part 708b contain information collection requirements. As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), NCUA is submitting a copy of this proposed rule as part of an information collection package to the Office of Management and Budget
(OMB)for its review and approval for revision of Collection of Information, Mergers of Federally Insured Credit Unions, Control Number 3133-0024. The proposed changes ensure that NCUA has sufficient information to determine whether to approve a proposed merger. The changes would also help ensure, in the case of a merging federal credit union, that members have sufficient and accurate information to exercise their vote properly concerning the proposed merger. In the five-year period ending June 30, 2006, NCUA approved 1,567 mergers involving federally insured credit unions. On average for the past five years, therefore, there were approximately 313 mergers each year that would be covered by the proposed rule. NCUA estimates less than one percent of these mergers will involve merger related financial arrangements as defined in the proposed rule. NCUA estimates it will take the merging credit unions about five hours to describe any merger related financial arrangements and include the description in the merger plan and, in cases involving a merging federal credit union, to make materials available to members upon request. One percent of 313, treating the two merging credit unions as one respondent, or 3.1 times five hours per respondent equals sixteen (rounding up from fifteen and one-half) total annual burden hours associated with this revision to the existing collection of information associated with this rule, OMB Control Number 3133-0024. Total Annual Burden Hours = Sixteen The Paperwork Reduction Act and OMB regulations require that the public be provided an opportunity to comment on the paperwork requirements, including an agency's estimate of the burden of the paperwork requirements. The NCUA Board invites comment on:
(1)Whether the paperwork requirements are necessary;
(2)the accuracy of NCUA's estimates on the burden of the paperwork requirements;
(3)ways to enhance the quality, utility, and clarity of the paperwork requirements; and
(4)ways to minimize the burden of the paperwork requirements. Comments should be sent to: OMB Reports Management Branch, New Executive Office Building, Room 10202, Washington, DC 20503; Attention: Mark Menchik, Desk Officer for NCUA. Please send NCUA a copy of any comments submitted to OMB. The Paperwork Reduction Act requires OMB to make a decision concerning the collection of information contained in these proposed regulations between 30 and 60 days after publication of this document in the **Federal Register** . Therefore, a comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication. This does not affect the deadline for the public to comment to the NCUA on the proposed regulations. Executive Order 13132 Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. In adherence to fundamental federalism principles, NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order. The proposed rule would not have substantial direct effects on the states, on the connection between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. NCUA has determined that this proposed rule does not constitute a policy that has federalism implications for purposes of the executive order. The Treasury and General Government Appropriations Act, 1999—Assessment of Federal Regulations and Policies on Families The NCUA has determined that this proposed rule would not affect family well-being within the meaning of § 654 of the Treasury and General Government Appropriations Act, 1999, Pub. L. 105-277, 112 Stat. 2681 (1998). List of Subjects 12 CFR Part 708b Credit unions, Mergers of credit unions, Reporting and recordkeeping requirements. By the National Credit Union Administration Board on April 12, 2007. Mary F. Rupp, Secretary of the Board. For the reasons stated above, NCUA proposes to amend 12 CFR part 708b as follows: PART 708b—MERGERS OF FEDERALLY-INSURED CREDIT UNIONS; VOLUNTARY TERMINATION OR CONVERSION OF INSURED STATUS 1. The authority citation for part 708b continues to read as follows: Authority: 12 U.S.C. 1766(a), 1785(b), 1785(c), and 1789(a). 2. Amend § 708b.2 by removing current alphabetical paragraph designations
(a)through
(k)and adding new definitions of “merger related financial arrangement” and “senior management official” in alphabetical order to read as follows: § 708b.2 Definitions. *Merger related financial arrangement* means a material increase in compensation (including indirect compensation, for example, bonuses, deferred compensation, or other financial rewards) or benefits that any board member or senior management official of a merging credit union may receive in connection with a merger transaction. For purposes of this definition, a material increase is an increase of 15% or $10,000, whichever is greater. *Senior management official* means the chief executive officer (who may hold the title of president or treasurer/manager), any assistant chief executive officer, and the chief financial officer. 3. Amend § 708b.103 by redesignating paragraphs (a)(7) through
(10)as paragraphs (a)(8) through
(11)and adding new paragraph (a)(7) to read as follows: § 708b.103 Preparation of merger plan.
(a)* * *
(7)Description of any merger related financial arrangement, as defined in § 708b.2. 4. Amend § 708b.106: A. By removing the semicolon at the end of paragraph (a)(2)(ii) and adding “,and disclosure of the existence of any merger related financial arrangement, as defined in § 708b.2;” and B. By adding a new paragraph (a)(2)(vii) to read as follows: § 708b.106 Approval of the merger proposal by numbers.
(a)* * *
(2)* * *
(vii)Inform the members they have the right to inspect the credit union's records pertaining to any merger related financial arrangement, as defined in § 708b.2, by submitting a request in writing to the credit union at least one day before the date announced for the meeting called for the purpose of voting on the merger. The inspection must occur at an office of the credit union during regular business hours and is limited to the right to review pertinent documents on site, without making or retaining copies. [FR Doc. E7-7608 Filed 4-20-07; 8:45 am] BILLING CODE 7535-01-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2006-26494; Directorate Identifier 2006-CE-79-AD] RIN 2120-AA64 Airworthiness Directives; Alpha Aviation Design Limited (Type Certificate No. A48EU Previously Held by APEX Aircraft and AVIONS PIERRE ROBIN) Model R2160 Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Supplemental notice of proposed rulemaking (NPRM); reopening of the comment period. SUMMARY: We are revising an earlier NPRM for the products listed above. This proposed AD results from mandatory continuing airworthiness information
(MCAI)originated by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as: * * * unchecked corrosion developing on the wing spars due to access for inspections being difficult under normal maintenance practices, which could lead to an unsafe condition and possibly a catastrophic failure of the wing * * * The proposed AD would require actions that are intended to address the unsafe condition described in the MCAI. DATES: We must receive comments on this proposed AD by May 23, 2007. ADDRESSES: You may send comments by any of the following methods: • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Fax:*
(202)493-2251. • *Mail:* Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC 20590-0001. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. • *Federal eRulemaking Portal:* *http://www.regulations.gov* . Follow the instructions for submitting comments. Examining the AD Docket You may examine the AD docket on the Internet at *http://dms.dot.gov* ; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (telephone
(800)647-5227) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt. FOR FURTHER INFORMATION CONTACT: Karl Schletzbaum, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4146; fax:
(816)329-4090. SUPPLEMENTARY INFORMATION: Streamlined Issuance of AD The FAA is implementing a new process for streamlining the issuance of ADs related to MCAI. This streamlined process will allow us to adopt MCAI safety requirements in a more efficient manner and will reduce safety risks to the public. This process continues to follow all FAA AD issuance processes to meet legal, economic, Administrative Procedure Act, and **Federal Register** requirements. We also continue to meet our technical decision-making responsibilities to identify and correct unsafe conditions on U.S.-certificated products. This proposed AD references the MCAI and related service information that we considered in forming the engineering basis to correct the unsafe condition. The proposed AD contains text copied from the MCAI and for this reason might not follow our plain language principles. Comments Invited We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2006-26494; Directorate Identifier 2006-CE-79-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments. We will post all comments we receive, without change, to *http://dms.dot.gov* , including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive about this proposed AD. Discussion We proposed to amend 14 CFR part 39 with an earlier NPRM for the specified products, which was published in the **Federal Register** on February 6, 2007 (72 FR 5364). That earlier NPRM proposed to require actions intended to address the unsafe condition for the products listed above. Since that NPRM was issued, we learned that the original New Zealand AD has been amended. The Civil Aviation Authority of New Zealand, which is the airworthiness authority for New Zealand, has issued AD DCA/R2000/37A, dated December 21, 2006 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states: which could lead to an unsafe condition and possibly a catastrophic failure of the wing accomplish the following: The MCAI requires inspecting the visible parts of the spar web and the upper and lower boom angles (top and bottom spar caps) for corrosion and correcting as necessary. You may obtain further information by examining the MCAI in the AD docket. Relevant Service Information AVIONS PIERRE ROBIN issued Avions Pierre Robin Service Letter No. 19, dated October 1980; and Avions Pierre Robin Service Bulletin No. 99, dated June 24, 1983. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI. Comments We received no comments on the earlier NPRM. FAA's Determination and Requirements of the Proposed AD This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with this State of Design Authority, they have notified us of the unsafe condition described in the MCAI and service information referenced above. We are proposing this AD because we evaluated all information and determined the unsafe condition exists and is likely to exist or develop on other products of the same type design. Certain changes described above expand the scope of the earlier NPRM. As a result, we have determined that it is necessary to reopen the comment period to provide additional opportunity for the public to comment on the proposed AD. Differences Between This Proposed AD and the MCAI or Service Information We have reviewed the MCAI and related service information and, in general, agree with their substance. But we might have found it necessary to use different words from those in the MCAI to ensure the AD is clear for U.S. operators and is enforceable. In making these changes, we do not intend to differ substantively from the information provided in the MCAI and related service information. We might also have proposed different actions in this AD from those in the MCAI in order to follow FAA policies. Any such differences are highlighted in a note within the proposed AD. These requirements, if ultimately adopted, will take precedence over the actions copied from the MCAI. Costs of Compliance Based on the service information, we estimate that this proposed AD would affect about 10 products of U.S. registry. We also estimate that it would take about 28 work-hours per product to comply with the proposed AD. The average labor rate is $80 per work-hour. Based on these figures, we estimate the cost of the proposed AD on U.S. operators to be $22,400, or $2,240 per product. We have no way of determining the number of products that may need any necessary follow-on actions. Since the corrosion damage would vary from airplane to airplane, we are not able to estimate the costs of each follow-on action. Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. “Subtitle VII: Aviation Programs,” describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in “Subtitle VII, Part A, Subpart III, Section 44701: General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. For the reasons discussed above, I certify this proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The FAA amends § 39.13 by adding the following new AD: **Alpha Aviation Design Limited (Type Certificate No. A48EU previously held by APEX Aircraft and AVIONS PIERRE ROBIN):** Docket No. FAA-2006-26494; Directorate Identifier 2006-CE-79-AD. Comments Due Date
(a)We must receive comments by May 23, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to Model R2160 airplanes, serial numbers 001 through 378, certificated in any category. Subject
(d)*Air Transport Association of America
(ATA)Code 57:* Wings. Reason
(e)The mandatory continuing airworthiness information
(MCAI)states: To prevent unchecked corrosion developing on the wing spars due to access for inspections being difficult under normal maintenance practices, which could lead to an unsafe condition and possibly a catastrophic failure of the wing accomplish the following: The MCAI requires inspecting the visible parts of the spar web and the upper and lower boom angles (top and bottom spar caps) for corrosion and correcting as necessary. Actions and Compliance
(f)Unless already done, do the following actions. Accomplishment of European Aviation Safety Agency
(EASA)AD 2005-0028 satisfies the requirement of this AD:
(1)Within 66 months after aircraft date of manufacture or within 6 months after the effective date of this AD, whichever occurs later, unless already done within the last 24 months, and thereafter at intervals not to exceed 24 months, remove the main landing gear legs and all the wing inspection panels following the instructions in the aircraft maintenance manual and inspect the visible parts of the spar web and the upper and lower boom angles (top and bottom spar caps), following Avions Pierre Robin Service Letter No. 19, dated October 1980; and Avions Pierre Robin Service Bulletin No. 99, dated June 24, 1983. If the spars are replaced, the inspections at intervals of 24 months must be resumed within 60 months from the date of replacement.
(2)Before further flight, if corrosion is found on the rear face of the spar web or the upper and lower boom angles, then inspect the front face of the spar for corrosion following Avions Pierre Robin Service Letter No. 19, dated October 1980; and Avions Pierre Robin Service Bulletin No. 99, dated June 24, 1983. It may be necessary to cut inspection holes or remove the wings to inspect the front face of the spar. Inspection holes must be prepared to a manufacturer-approved repair scheme.
(3)Before further flight, treat corrosion following Avions Pierre Robin Service Letter No. 19, dated October 1980; and Avions Pierre Robin Service Bulletin No. 99, dated June 24, 1983.
(4)Before further flight, if corrosion is found which exceeds the limits specified in Avions Pierre Robin Service Letter No. 19, dated October 1980, repair following an approved repair scheme. FAA AD Differences Note: This AD differs from the MCAI and/or service information as follows: No differences. Other FAA AD Provisions
(g)The following provisions also apply to this AD:
(1)*Alternative Methods of Compliance (AMOCs):* The Manager, Standards Staff, FAA, ATTN: Karl Schletzbaum, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4146; fax:
(816)329-4090, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. Before using any approved AMOC on any airplane to which the AMOC applies, notify your appropriate principal inspector
(PI)in the FAA Flight Standards District Office (FSDO), or lacking a PI, your local FSDO.
(2)*Airworthy Product:* For any requirement in this AD to obtain corrective actions from a manufacturer or other source, use these actions if they are FAA-approved. Corrective actions are considered FAA-approved if they are approved by the State of Design Authority (or their delegated agent). You are required to assure the product is airworthy before it is returned to service.
(3)*Reporting Requirements:* For any reporting requirement in this AD, under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.), the Office of Management and Budget
(OMB)has approved the information collection requirements and has assigned OMB Control Number 2120-0056. Related Information
(h)Refer to MCAI Civil Aviation Authority of New Zealand AD DCA/R2000/37A, dated December 21, 2006; Avions Pierre Robin Service Letter No. 19, dated October 1980; and Avions Pierre Robin Service Bulletin No. 99, dated June 24, 1983, for related information. Issued in Kansas City, Missouri, on April 17, 2007. Charles L. Smalley, Acting Manager, Small Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-7644 Filed 4-20-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-27431; Directorate Identifier 2007-CE-016-AD] RIN 2120-AA64 Airworthiness Directives; Stemme GmbH & Co. KG Models STEMME S10-V and STEMME S10-VT Powered Sailplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: We propose to adopt a new airworthiness directive
(AD)for the products listed above. This proposed AD results from mandatory continuing airworthiness information
(MCAI)originated by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as: Service experience showed that the connection screw of the propeller blade follower type 10AP-VM may break and the main part of the blade follower can be lost in flight. This condition, if not corrected, could lead to high vibration during powered flight and consequently result in decreased control of the aircraft. Stemme has developed a new blade follower, Model 10AP-VP, which is reinforced on the shaft and has an Allen head screw installed instead of a slotted screw. For the reason stated above, this Emergency Airworthiness Directive
(EAD)requires the replacement of the blade follower type 10AP-VM with the new type 10AP-VP. This EAD has been revised to correct the TCDS reference and the applicability statement. No separate TC was issued for the affected propellers. These propellers are part of the aircraft type design. Paragraph
(4)of the “Compliance” section of this EAD has been corrected. The proposed AD would require actions that are intended to address the unsafe condition described in the MCAI. DATES: We must receive comments on this proposed AD by May 23, 2007. ADDRESSES: You may send comments by any of the following methods: • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Fax:*
(202)493-2251. • *Mail:* Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC 20590-0001. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. • *Federal eRulemaking Portal:* Go to *http://www.regulations.gov.* Follow the instructions for submitting comments. Examining the AD Docket You may examine the AD docket on the Internet at *http://dms.dot.gov;* or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (telephone
(800)647-5227) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt. FOR FURTHER INFORMATION CONTACT: Gregory Davison, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4130; fax:
(816)329-4090. SUPPLEMENTARY INFORMATION: Streamlined Issuance of AD The FAA is implementing a new process for streamlining the issuance of ADs related to MCAI. This streamlined process will allow us to adopt MCAI safety requirements in a more efficient manner and will reduce safety risks to the public. This process continues to follow all FAA AD issuance processes to meet legal, economic, Administrative Procedure Act, and **Federal Register** requirements. We also continue to meet our technical decision-making responsibilities to identify and correct unsafe conditions on U.S.-certificated products. This proposed AD references the MCAI and related service information that we considered in forming the engineering basis to correct the unsafe condition. The proposed AD contains text copied from the MCAI and for this reason might not follow our plain language principles. Comments Invited We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2007-27431; Directorate Identifier 2007-CE-016-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments. We will post all comments we receive, without change, to *http://dms.dot.gov,* including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive about this proposed AD. Discussion The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued EASA Emergency AD No. 2006-0373R1-E, dated December 15, 2006, corrected January 5, 2007 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states: Service experience showed that the connection screw of the propeller blade follower type 10AP-VM may break and the main part of the blade follower can be lost in flight. This condition, if not corrected, could lead to high vibration during powered flight and consequently result in decreased control of the aircraft. Stemme has developed a new blade follower, Model 10AP-VP, which is reinforced on the shaft and has an Allen head screw installed instead of a slotted screw. For the reason stated above, this Emergency Airworthiness Directive
(EAD)requires the replacement of the blade follower type 10AP-VM with the new type 10AP-VP. This EAD has been revised to correct the TCDS reference and the applicability statement. No separate TC was issued for the affected propellers. These propellers are part of the aircraft type design. Paragraph
(4)of the “Compliance” section of this EAD has been corrected. You may obtain further information by examining the MCAI in the AD docket. Relevant Service Information Stemme GmbH & Co. KG has issued STEMME F & D Service Bulletin
(SB)A31-10-078, Am.-Index: 01.a, dated November 6, 2006. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI. FAA's Determination and Requirements of the Proposed AD This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with this State of Design Authority, they have notified us of the unsafe condition described in the MCAI and service information referenced above. We are proposing this AD because we evaluated all information and determined the unsafe condition exists and is likely to exist or develop on other products of the same type design. Differences Between This Proposed AD and the MCAI or Service Information We have reviewed the MCAI and related service information and, in general, agree with their substance. But we might have found it necessary to use different words from those in the MCAI to ensure the AD is clear for U.S. operators and is enforceable. In making these changes, we do not intend to differ substantively from the information provided in the MCAI and related service information. We might also have proposed different actions in this AD from those in the MCAI in order to follow FAA policies. Any such differences are highlighted in a note within the proposed AD. Costs of Compliance Based on the service information, we estimate that this proposed AD would affect about 53 products of U.S. registry. We also estimate that it would take about 3 work-hours per product to comply with the basic requirements of this proposed AD. The average labor rate is $80 per work-hour. Required parts would cost about $117 per product. Where the service information lists required parts costs that are covered under warranty, we have assumed that there will be no charge for these costs. As we do not control warranty coverage for affected parties, some parties may incur costs higher than estimated here. Based on these figures, we estimate the cost of the proposed AD on U.S. operators to be $18,921, or $357 per product. Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. “Subtitle VII: Aviation Programs,” describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in “Subtitle VII, Part A, Subpart III, Section 44701: General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. For the reasons discussed above, I certify this proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The FAA amends § 39.13 by adding the following new AD: **Stemme GmbH & Co. KG Models STEMME S10-V and STEMME S10-VT Powered Sailplanes:** Docket No. FAA-2007-27431; Directorate Identifier 2007-CE-016-AD. Comments Due Date
(a)We must receive comments by May 23, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to Models STEMME S10-V and STEMME S10-VT powered sailplanes, all serial numbers, certificated in any category. Subject
(d)Air Transport Association of America
(ATA)Code 61: Propellers. Reason
(e)The mandatory continuing airworthiness information
(MCAI)states: Service experience showed that the connection screw of the propeller blade follower type 10AP-VM may break and the main part of the blade follower can be lost in flight. This condition, if not corrected, could lead to high vibration during powered flight and consequently result in decreased control of the aircraft. Stemme has developed a new blade follower, Model 10AP-VP, which is reinforced on the shaft and has an Allen head screw installed instead of a slotted screw. For the reason stated above, this Emergency Airworthiness Directive
(EAD)requires the replacement of the blade follower type 10AP-VM with the new type 10AP-VP. This EAD has been revised to correct the TCDS reference and the applicability statement. No separate TC was issued for the affected propellers. These propellers are part of the aircraft type design. Paragraph
(4)of the “Compliance” section of this EAD has been corrected. Actions and Compliance
(f)Unless already done, within 25 engine operating hours or 90 days after the effective date of this AD, whichever occurs first, do the following actions:
(1)Replace the blade follower type 10AP-VM with the new type 10AP-VP following the instructions contained in STEMME F & D SB A31-10-078, Am.-index: 01.a, dated November 6, 2006.
(2)As of 25 engine operating hours or 90 days after the effective date of this AD, do not install a propeller type 10AP-F, 10AP-V or 11AP-V on any aircraft, unless that propeller has the new type 10AP-VP blade follower installed following the instructions contained in STEMME F & D SB A31-10-078, Am.-index: 01.a, dated November 6, 2006. FAA AD Differences Note: This AD differs from the MCAI and/or service information as follows: The MCAI requires an amendment to the aircraft flight manual before further flight as an interim requirement to the replacement. We consider before flight as an urgent safety of flight compliance time, and we do not consider this unsafe condition to be an urgent safety of flight condition. We feel that 25 engine operating hours or 90 days, whichever occurs first, for the replacement is an adequate compliance for this AD action and meets the FAA requirements of a notice of proposed rulemaking (NPRM). We do encourage you to incorporate these flight manual amendments referenced in the MCAI and service information until you replace the propeller blade follower. Other FAA AD Provisions
(g)The following provisions also apply to this AD:
(1)*Alternative Methods of Compliance (AMOCs):* The Manager, Standards Staff, FAA, ATTN: Gregory Davison, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri, 64106; telephone:
(816)329-4130; fax:
(816)329-4090, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. Before using any approved AMOC on any airplane to which the AMOC applies, notify your appropriate principal inspector
(PI)in the FAA Flight Standards District Office (FSDO), or lacking a PI, your local FSDO.
(2)*Airworthy Product:* For any requirement in this AD to obtain corrective actions from a manufacturer or other source, use these actions if they are FAA-approved. Corrective actions are considered FAA-approved if they are approved by the State of Design Authority (or their delegated agent). You are required to assure the product is airworthy before it is returned to service.
(3)*Reporting Requirements:* For any reporting requirement in this AD, under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et.seq.), the Office of Management and Budget
(OMB)has approved the information collection requirements and has assigned OMB Control Number 2120-0056. Related Information
(h)Refer to MCAI European Aviation Safety Agency
(EASA)Emergency AD No.: 2006-0373R1-E, dated December 15, 2006, corrected January 5, 2007; and STEMME F & D SB A31-10-078, Am.-index: 01.a, dated November 6, 2006, for related information. Issued in Kansas City, Missouri, on April 17, 2007. Charles L. Smalley, Acting Manager, Small Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-7642 Filed 4-20-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-27229; Directorate Identifier 2007-NE-03-AD] RIN 2120-AA64 Airworthiness Directives; CFM International, S.A. CFM56-7B Series Turbofan Engines AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: The FAA proposes to adopt a new airworthiness directive
(AD)for CFM International, S.A. CFM56-7B Series Turbofan Engines. This proposed AD would require revising the Airworthiness Limitations Section
(ALS)in the Engine Shop Manual
(ESM)and the air carrier's approved continuous airworthiness maintenance program
(CAMP)to add mandatory inspections of certain low pressure turbine rear frames
(TRFs)to the ALS or CAMP. This proposed AD results from a refined lifing analysis by the engine manufacturer that shows the need to identify an initial threshold for inspecting certain TRFs. We are proposing this AD to prevent failure of the TRF from low-cycle fatigue cracks. Failure of the TRF could result in engine separation from the airplane, which could lead to loss of control of the airplane. DATES: We must receive any comments on this proposed AD by June 22, 2007. ADDRESSES: Use one of the following addresses to comment on this proposed AD. • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Government-wide rulemaking Web site:* Go to *http://www.regulations.gov* and follow the instructions for sending your comments electronically. • *Mail:* Docket Management Facility; U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC 20590-0001. • *Fax:*
(202)493-2251. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. You may examine the comments on this proposed AD in the AD docket on the Internet at *http://dms.dot.gov.* FOR FURTHER INFORMATION CONTACT: Colleen M. D'Alessandro, Aerospace Engineer, Engine Certification Office, FAA, Engine and Propeller Directorate, 12 New England Executive Park, Burlington, MA 01803; telephone
(781)238-7133; fax
(781)238-7199. SUPPLEMENTARY INFORMATION: Comments Invited We invite you to send us any written relevant data, views, or arguments regarding this proposal. Send your comments to an address listed under ADDRESSES . Include “Docket No. FAA-2007-27229; Directorate Identifier 2007-NE-03-AD” in the subject line of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments. We will post all comments we receive, without change, to *http://dms.dot.gov* , including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed AD. Using the search function of the DOT Web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You may review the DOT's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477-78) or you may visit *http://dms.dot.gov.* Examining the AD Docket You may examine the docket that contains the proposal, any comments received and, any final disposition in person at the DOT Docket Offices between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone
(800)647-5227) is located on the plaza level of the Department of Transportation Nassif Building at the street address stated in ADDRESSES . Comments will be available in the AD docket shortly after the Docket Management Facility receives them. Discussion This AD is required because TRFs, part numbers 340-166-205-0, 340-166-206-0, 340-166-207-0, 340-166-208-0, 340-166-209-0, 340-166-210-0, now require an initial inspection threshold of 25,000 cycles-in-service
(CIS)on the commercial (air carrier) models engines and 19,000 CIS on the business jet models. This proposed AD would not affect any other CFM56-7B part number TRFs. We have been monitoring CFM's revised life analysis progress since February 2005. CFM International provided to us the November 15, 2006 revision to the ESM to introduce mandatory inspections of the TRF. CFM International has been using a damage tolerant lifing approach, based on an FAA approved methodology for structural lifed components, to prepare life extensions for all CFM56 TRFs using on-condition life management. This improved life management process defines a first inspection threshold and reinspection intervals accounting for crack initiation and propagation. The previous life management process was based on crack initiation only. This condition, if not corrected, could result in failure of the TRF from low-cycle fatigue cracks. Failure of the TRF could result in engine separation from the airplane, which could lead to loss of control of the airplane. FAA's Determination and Requirements of the Proposed AD We have evaluated all pertinent information and identified an unsafe condition that is likely to exist or develop on other products of this same type design. We are proposing this AD, which would require revising the Airworthiness Limitations Section in the ESM and the air carrier's approved continuing airworthiness maintenance program to incorporate life reductions for certain TRFs. Costs of Compliance We estimate that this proposed AD would affect 1,228 engines installed on airplanes of U.S. registry. Since life extensions are possible on condition, the cost of the proposed AD will be limited to performing TRF inspections. We also estimate that it would take about 3.0 work-hours per engine to perform the proposed actions, including the TRF inspections, and that the average labor rate is $80 per work-hour. There are no required parts. Based on these figures, we estimate the total cost of the proposed AD to U.S. operators to be $294,720. Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. For the reasons discussed above, I certify that the proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Would not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD. See the ADDRESSES section for a location to examine the regulatory evaluation. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Under the authority delegated to me by the Administrator, the Federal Aviation Administration proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The FAA amends § 39.13 by adding the following new airworthiness directive: **CFM International:** Docket No. FAA-2007-27229; Directorate Identifier 2007-NE-03-AD. Comments Due Date
(a)The Federal Aviation Administration
(FAA)must receive comments on this airworthiness directive
(AD)action by June 22, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to CFM International CFM56-7B18, -7B20, -7B22, -7B24, -7B26, -7B27, -7B22/B1, -7B24/B1, -7B26/B1, -7B27/B1, -7B22/B2, -7B26/B2, -7B27/B3 turbofan engines with Turbine Rear Frame (TRF), part numbers 340-166-205-0, 340-166-206-0, 340-166-207-0, 340-166-208-0, 340-166-209-0, 340-166-210-0, installed. These engines are installed on, but not limited to, Boeing 737 series airplanes. Unsafe Condition
(d)This proposed AD results from a refined lifing analysis by the engine manufacturer that shows the need to identify an initial threshold for inspecting certain TRFs. We are proposing this AD to prevent failure of the TRF from low-cycle fatigue cracks. Failure of the TRF could result in engine separation from the airplane, which could lead to loss of control of the airplane. Compliance
(e)You are responsible for having the actions required by this AD performed within 30 days after the effective date of this AD, unless the actions have already been done. Mandatory Inspections
(f)Within the next 30 days after the effective date of this AD, revise the applicable inspection program for the Business Jet and Air Carrier engine models by adding the Mandatory Inspection Intervals as specified in this AD, and revise the Airworthiness Limitations Section (chapter 05-21-03) of the CFM56-7B Engine Shop Manual, CFMI-TP-SM.10 by adding the following: “TURBINE REAR FRAME WITH TANGENTIAL STRUTS—MANDATORY INSPECTIONS—LIFE LIMITS TASK 05-21-03-200-001 1. *General* A. This procedure gives the FAA and EASA mandatory Eddy Current inspection intervals for the turbine rear frame with tangential struts. The inspection uses: —A threshold limit, —Inspection intervals, B. The threshold limit is the timing of the first required inspection. First inspection must be done before that part has reached the threshold number of flight cycles. C. The inspection intervals specify the timing of inspections to be done after the threshold inspection has been reached. Inspections are repetitive without any limit. 2. *Mandatory Inspection Intervals for the Critical Areas of the Turbine Rear Frame with Tangential Struts (4 Mount Struts, No. 1, 2, 15, and 16).* C. Turbine Rear Frame Part Numbers 340-166-205-0, 340-166-206-0, 340-166-207-0, 340-166-208-0, 340-166-209-0, 340-166-210-0, for all CFM56-7B SAC engine models (except -7B27A engine models). Refer to figure 805. Figure index No. Inspection location Inspection threshold (cycles since new) Inspection intervals (cycles) Inspection reference 805 Strut/outer ring fillet radius on trailing edge
(A)25,000* for -7B SAC (except business jet) engine models Refer to Figure 806* for -7B SAC commercial applications Refer to SB 72-0579*. Strut/outer ring fillet radius on leading edge
(B)19,000* for -7B SAC business jet engine models Refer to Figure 807* for -7B SAC business jet applications Strut/outer ring fillet radius on trailing edge (C1 below outer ring) Strut/outer ring fillet radius on trailing edge (C2 above outer ring) Note: * Applicable to all inspection locations. If inspection is not performed, part must be removed. EP23AP07.004 Turbine Rear Frame with Tangential struts P/N 340-166-205-0, 340-166-206-0, 340-166-207-0, 340-166-208-0, 340-166-209-0, 340-166-210-0-Areas to Be Inspected Figure 805, MANDATORY INSPECTION INTERVAL FOR TURBINE REAR FRAME P/N 340-166-205/206/207/208/209/210-0 IF NO CRACK IS FOUND ON ANY OF THE FOUR MOUNT STRUTS, THE TURBINE REAR FRAME IS SERVICEABLE AND MUST BE RE-INSPECTED AT 4,700 CYCLE REPETITIVE INTERVALS. IF CRACKS ARE FOUND ON THE MOUNT STRUTS, THE TRF MUST BE RE-INSPECTED ACCORDING TO THE FOLLOWING REPETITIVE INTERVALS Total cumulated crack length at each location Re-inspect within L < 0.20
(5)4,700. 0.20
(5)≤ L < 0.28
(7)3,300. 0.28
(7)≤ L < 0.39
(10)1,300. 0.39
(10)≤ L < 0.59
(15)700. 0.59
(15)≤ L < 0.79
(20)120. L ≥ 0.79
(20)IMMEDIATELY REMOVE THE TURBINE FRAME. DURING EACH INSPECTION, ALL THE LOCATIONS MUST BE INSPECTED. IF CRACKS ARE FOUND AT DIFFERENT LOCATIONS, THE REPETITIVE INSPECTION INTERVAL IS THE MINIMUM INTERVAL CORRESPONDING TO THE MAX. CUMULATED CRACK LENGTHS. NOTE: DIMENSIONS ARE IN INCHES WITH MILLIMETERS IN PARENTHESES. Inspection Intervals for -7B SAC (Except Business Jet) Engine Models Figure 806 MANDATORY INSPECTION INTERVAL FOR TURBINE REAR FRAME P/N 340-166-205/206/207/208/209/210-0 IF NO CRACK IS FOUND ON ANY OF THE FOUR MOUNT STRUTS, THE TURBINE REAR FRAME IS SERVICEABLE AND MUST BE RE-INSPECTED AT 3,300 CYCLE REPETITIVE INTERVALS. IF CRACKS ARE FOUND ON THE MOUNT STRUTS, THE TRF MUST BE RE-INSPECTED ACCORDING TO THE FOLLOWING REPETITIVE INTERVALS Total cumulated crack length at each location Re-inspect within L < 0.20
(5)3,300. 0.20
(5)≤ L < 0.28
(7)2,400. 0.28
(7)≤ L < 0.39
(10)900. 0.39
(10)≤ L < 0.59
(15)500. 0.59
(15)≤ L < 0.79
(20)80. L ≥ 0.79
(20)IMMEDIATELY REMOVE THE TURBINE FRAME. DURING EACH INSPECTION, ALL THE LOCATIONS MUST BE INSPECTED. IF CRACKS ARE FOUND AT DIFFERENT LOCATIONS, THE REPETITIVE INSPECTION INTERVAL IS THE MINIMUM INTERVAL CORRESPONDING TO THE MAX. CUMULATED CRACK LENGTHS. NOTE: DIMENSIONS ARE IN INCHES WITH MILLIMETERS IN PARENTHESES. Inspection Intervals for -7B SAC Business Jet Engine Models Figure 807
(g)After the effective date of this AD, we will not approve any alternative inspection intervals for these parts except as provided for in paragraph
(j)of this AD. TRFs With Unknown Cycles
(h)If you can not establish the number of cycles accumulated since new, remove or inspect the TRF within 300 cycles-in-service after the effective date of this AD. The CFM56-7B ESM or CAMP contains information for inspecting the TRF.
(i)You may install a TRF removed in paragraph
(h)of this AD after the TRF passes an initial inspection for cracks. The CFM56-7B ESM or continuous airworthiness program contains information on inspecting the TRF. Alternative Methods of Compliance
(j)The Manager, Engine Certification Office, has the authority to approve alternative methods of compliance for this AD if requested using the procedures found in 14 CFR 39.19. Maintaining Records of the Mandatory Inspections
(k)You have met the requirements of this AD by making the changes to the Engine Shop Manual as specified in paragraph
(f)of this AD, and, for air carriers operating under part 121 of the Federal Aviation Regulations (14 CFR part 121), by modifying your continuous airworthiness maintenance plan to reflect those changes. You must maintain records of the mandatory inspections that result from those changes to the ALS according to the regulations governing your operation. You do not need to record each inspection as compliance to this AD. For air carriers operating under part 121, you may use the system established to comply with section 121.369. Related Information
(l)CFM International Service Bulletin CFM56-7B S/B 72-0579, Revision 1, Dated October 27, 2006, contains information about Eddy Current inspection. Issued in Burlington, Massachusetts, on April 13, 2007. Peter A. White, Acting Manager, Engine and Propeller Directorate, Aircraft Certification Service. [FR Doc. E7-7504 Filed 4-20-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 71 [Docket No. FAA-2007-27332; Airspace Docket No. 07-AWP-2] Proposed Establishment of Low Altitude Area Navigation Routes (T-Routes); Los Angeles, CA AGENCY: Federal Aviation Administration (FAA), DOT. ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: This action proposes to establish three low altitude Area Navigation
(RNAV)routes, designated T-245, T-247, and T-249 in the Los Angeles International Airport, CA, terminal area. T-routes are low altitude Air Traffic Service
(ATS)routes, based on RNAV, for use by aircraft having instrument flight rules
(IFR)approved Global Positioning System (GPS)/Global Navigation Satellite System
(GNSS)equipment. The FAA is proposing this action to enhance safety and improve the efficient use of the navigable airspace in the Los Angeles International Airport, CA, terminal area. DATES: Comments must be received on or before June 7, 2007. ADDRESSES: Send comments on this proposal to the Docket Management System, U.S. Department of Transportation, Room Plaza 401, 400 Seventh Street, SW., Washington, DC 20590-0001. You must identify FAA Docket No. FAA-2007-27332 and Airspace Docket No. 07-AWP-2, at the beginning of your comments. You may also submit comments through the Internet at http://dms.dot.gov. FOR FURTHER INFORMATION CONTACT: Ken McElroy, Airspace and Rules Group, Office of System Operations Airspace and AIM, Federal Aviation Administration, 800 Independence Avenue, SW., Washington, DC 20591; telephone:
(202)267-8783. SUPPLEMENTARY INFORMATION: Comments Invited Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers (FAA Docket No. FAA-2007-27332 and Airspace Docket No. 07-AWP-2) and be submitted in triplicate to the Docket Management System (see ADDRESSES section for address and phone number). You may also submit comments through the Internet at *http://dms.dot.gov.* Commenters wishing the FAA to acknowledge receipt of their comments on this action must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to FAA Docket No. FAA-2007-27332 and Airspace Docket No. 07-AWP-2.” The postcard will be date/time stamped and returned to the commenter. All communications received on or before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of comments received. All comments submitted will be available for examination in the public docket both before and after the closing date for comments. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket. Availability of NPRM's An electronic copy of this document may be downloaded through the Internet at *http://dms.dot.gov* . Recently published rulemaking documents can also be accessed through the FAA's web page at *http://www.faa.gov* , or the **Federal Register** 's web page at *http://www.gpoaccess.gov/fr/index.html.* You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office (see ADDRESSES section for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Western Service Center, Air Traffic Organization, Federal Aviation Administration, 1601 Lind Avenue, 15000 SW., Renton, WA 98055. Persons interested in being placed on a mailing list for future NPRM's should contact the FAA's Office of Rulemaking,
(202)267-9677, for a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure. Low Altitude RNAV Route Identification and Charting Low altitude RNAV routes are identified by the letter “T” prefix followed by a three digit number. The “T” prefix is one of several International Civil Aviation Organization designators used to identify domestic RNAV routes. The FAA has been allocated the letter “T” prefix and the number block 200 to 500 for use in naming these routes. The FAA uses the “T” prefix for RNAV routes in the low altitude en route structure of the National Airspace System. T-routes are depicted in blue on the appropriate IFR en route low altitude chart(s). Each route depiction includes a GNSS minimum en route altitude to ensure obstacle clearance and communications reception. The Proposal The FAA is proposing an amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 to establish three low altitude RNAV routes in the Los Angeles International Airport, CA, terminal area. The routes would be designated T-245, T-247, and T-249, and would be depicted on the appropriate IFR En Route Low Altitude charts. T-routes are low altitude RNAV ATS routes, similar to Very High Frequency Omnidirectional Range Federal airways, but based on GNSS navigation. RNAV-equipped aircraft capable of filing flight plan equipment suffix “G” may file for these routes. The T-routes described in this notice are being proposed to enhance safety, and to facilitate the more flexible and efficient use of the navigable airspace for en route IFR operations transitioning through and around the Los Angeles Class B airspace area. Low altitude RNAV routes are published in paragraph 6011 of FAA Order 7400.9P, dated September 1, 2006 and effective September 15, 2006, which is incorporated by reference in 14 CFR 71.1. The low altitude RNAV routes listed in this document would be published subsequently in the Order. The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this proposed regulation:
(1)Is not a “significant regulatory action” under Executive Order 12866;
(2)is not a “significant rule” under Department of Transportation
(DOT)Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and
(3)does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this proposed rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. Environmental Review The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1E, “Environmental Impacts: Policies and Procedures,” paragraph 311a, 311b, and 311k. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment. List of Subjects in 14 CFR Part 71 Airspace, Incorporation by reference, Navigation (air). The Proposed Amendment In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows: PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS 1. The authority citation for part 71 continues to read as follows: Authority: 49 U.S.C. 106(g), 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389. § 71.1 [Amended] 2. The incorporation by reference in 14 CFR 71.1 of FAA Order 7400.9P, Airspace Designations and Reporting Points, dated September 1, 2006, and effective September 15, 2006, is amended as follows: Paragraph 6011—Area Navigation Routes **T-245 Seal Beach, CA
(SLI)to SILEX [New]** Seal Beach
(SLI)VORTAC (Lat. 33°47′00″ N., long. 118°03′17″ W.) POPPR Fix (Lat. 33°50′34″ N., long. 118°17′18″ W.) Santa Monica
(SMO)VOR/DME (Lat. 34°00′37″ N., long. 118°27′24″ W.) SILEX Fix (Lat. 34°12′04″ N., long. 118°36′39″ W.) * * * * * * * **T-247 Seal Beach, CA
(SLI)to CANOG [New]** Seal Beach
(SLI)VORTAC (Lat. 33°47′00″ N., long. 118°03′17″ W.) POPPR Fix (Lat. 33°50′34″ N., long. 118°17′18″ W.) Santa Monica
(SMO)VOR/DME (Lat. 34°00′37″ N., long. 118°27′24″ W.) CANOG Fix (Lat. 34°13′24″ N., long. 118°35′39″ W.) * * * * * * * **T-249 Van Nuys, CA
(VNY)to Seal Beach, CA [New]** Van Nuys
(VNY)VOR/DME (Lat. 34°13′24″ N., long. 118°29′30″ W.) Santa Monica
(SMO)VOR/DME (Lat. 34°00′37″ N., long. 118°27′24″ W.) POPPR Fix (Lat. 33°50′34″ N., long. 118°17′18″ W.) Seal Beach
(SLI)VORTAC (Lat. 33°47′00″ N., long. 118°03′17″ W.) * * * * * Issued in Washington, DC, on April 13, 2007. Edith V. Parish, Manager, Airspace and Rules Group. [FR Doc. E7-7633 Filed 4-20-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 20 [REG-143316-03] RIN 1545-BC56 Guidance Under Section 2053 Regarding Post-Death Events AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Notice of proposed rulemaking and notice of public hearing. SUMMARY: This document contains proposed amendments to the regulations relating to the amount deductible from a decedent's gross estate for claims against the estate under section 2053(a)(3) of the Internal Revenue Code (Code). In addition, the proposed regulations update the provisions relating to the deduction for certain state death taxes to reflect the statutory amendments made in 2001 under sections 2053(d) and 2058. The proposed regulations will affect estates of decedents against whom there are claims outstanding at the time of the decedent's death. This document also provides notice of a public hearing on these proposed regulations. DATES: Written or electronic comments must be received by July 23, 2007. Outlines of topics to be discussed at the public hearing scheduled for August 6, 2007, at 10 a.m., must be received by July 30, 2007. ADDRESSES: Send submissions to: CC:PA:LPD:PR (REG-143316-03), Room 5203, Internal Revenue Service, PO Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG-143316-03), Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue, NW., Washington, DC; or sent electronically via the Federal eRulemaking Portal at *http://www.regulations.gov* (IRS REG-143316-03). The public hearing will be held in the IRS Auditorium, Internal Revenue Building, 1111 Constitution Avenue, NW., Washington, DC. FOR FURTHER INFORMATION CONTACT: Concerning the proposed regulations, DeAnn K. Malone, at
(202)622-3112; concerning submissions of comments, the hearing, and/or to be placed on the building access list to attend the hearing, Richard Hurst, at
(202)622-2949 (TDD telephone) (not toll-free numbers) or e-mail at *Richard.A.Hurst@irscounsel.treas.gov.* SUPPLEMENTARY INFORMATION: Background Section 2001 of the Code imposes a tax on the transfer of the taxable estate, determined as provided in section 2051, of every decedent, citizen, or resident of the United States. Section 2031(a) generally provides that the value of the decedent's gross estate shall include the value at the time of decedent's death of all property, real or personal, tangible or intangible, wherever situated. Section 2051 provides that the value of the taxable estate is determined by deducting from the value of the gross estate the deductions provided for in sections 2051 through 2058. Pursuant to section 2053(a), “the value of the taxable estate shall be determined by deducting from the value of the gross estate such amounts—(1) for funeral expenses,
(2)for administration expenses,
(3)for claims against the estate, and
(4)for unpaid mortgages on, or any indebtedness in respect of, property where the value of the decedent's interest therein, undiminished by such mortgage or indebtedness, is included in the value of the gross estate, as are allowable by the laws of the jurisdiction, whether within or without the United States, under which the estate is being administered.” The deductions allowable under sections 2051 through 2058 operate to eliminate from estate taxation those portions of the gross estate that are necessarily expended in paying certain claims and expenses of the estate. The rationale for those deductions is that those expended portions of the gross estate are not transferred to the decedent's legatees, beneficiaries, or heirs and, therefore, are not subject to the transfer tax. The amount an estate may deduct for claims against the estate has been a highly litigious issue. Unlike section 2031, section 2053(a) does not contain a specific directive to value a deductible claim at its date of death value. Section 2053, in fact, specifically contemplates expenses such as funeral and administration expenses, which are only determinable after the decedent's date of death. Although numerous courts have addressed section 2053(a)(3), there is little or no consistency among the conclusions of those courts with regard to the extent (if any) to which post-death events are to be considered in valuing such claims. One line of cases follows the decision in *Ithaca Trust* v. *Commissioner* , 279 U.S. 151 (1929), holding that the estate tax charitable deduction for a charitable remainder interest was to be determined as of date of death. In Federal judicial circuits where the *Ithaca Trust* date-of-death valuation approach is applied to a claim against a decedent's estate under section 2053(a)(3), courts generally hold that post-death events may not be considered when determining the amount deductible for that claim. At the opposite end of the spectrum, there is a line of cases that follows the Eighth Circuit's opinion in *Jacobs* v. *Commissioner* , 34 F.2d 233 (8th Cir. 1929), *cert. denied* , 280 U.S. 603 (1929), in which the court considered but rejected the date-of-death valuation approach in determining the deductible amount of a claim against the estate. The court in *Jacobs* distinguished *Ithaca Trust* , stating that, unlike charitable deductions, “* * * the claims which Congress intended to be deducted were actual claims, not theoretical ones.” The court therefore held that only claims presented and determined as valid against the estate and actually paid could be deducted as claims against the estate. *Jacobs* , 34 F.2d at 235. The courts that follow *Jacobs* generally restrict the amount deductible under section 2053(a)(3) to amounts actually paid by the estate in satisfaction of the claim. Even in the circuits where the date-of-death valuation approach has been applied in determining the amount that may be deducted for a claim against the decedent's estate, courts have recognized exceptions that necessitate taking into account events that occur after the decedent's death. For example, courts have deviated from the date-of-death valuation approach in favor of the actual payment approach when a claim is contested, contingent, unenforceable, becomes unenforceable after the decedent's death, or is not in fact presented for payment. The application and extent of these exceptions are inconsistent from circuit to circuit, however, and cannot be reconciled to form a conclusive rule applicable to all estates. The result of this lack of consistency in the case law is that similarly situated estates are being treated differently for Federal estate tax purposes, depending only upon the jurisdiction in which the executor resides. The Treasury Department and the IRS believe that similarly situated estates should be treated consistently by having section 2053(a)(3) construed and applied in the same way in all jurisdictions. One possible approach would be to value claims against a decedent's estate on the basis of the facts existing on the date of the decedent's death. The Treasury Department and the IRS believe, however, that this date-of-death valuation approach, when applied, has required an inefficient use of resources for taxpayers, the IRS, and the courts. Determining a date-of-death value requires the taxpayer and the IRS to retry the substantive issues underlying the claims against the estate in a tax controversy setting. In most cases, the tax controversy is addressed after the issue either has been settled by or has been argued by parties with adverse interests in a court of competent jurisdiction that is more familiar with the nuances of the underlying applicable law. Furthermore, this approach has proven to be expensive, both in terms of appraisal and litigation costs. In addition, this approach generally results in a deduction that is different from the amount actually paid on disputed claims. Finally, the date-of-death valuation approach often forces the taxpayer involved in actively defending against a claim to take contradictory positions on the estate tax return and in the substantive court pleadings, and may actually increase the taxpayer's potential liability. After carefully considering the numerous judicial decisions and the analysis and conclusion in each, the legislative history of section 2053 and its predecessors, and the various possible alternatives, and in order to further the goal of the effective and fair administration of the tax laws, the proposed regulations adopt rules based on the premise that an estate may deduct under section 2053(a)(3) only amounts actually paid in settlement of claims against the estate. If the resolution of a contested or contingent claim cannot be reached prior to the expiration of the period of limitations for claims for refund, the estate may file a protective claim for refund to preserve its right to claim a deduction under section 2053(a). Explanation of Provisions The proposed regulations will amend the regulations under section 2053 to clarify that events occurring after a decedent's death are to be considered when determining the amount deductible under all provisions of section 2053 and that deductions under section 2053 are limited to amounts actually paid by the estate in satisfaction of deductible expenses and claims. Final court decisions as to the amount and enforceability of the claim or expense are accepted in determining the amount deductible if the court passes upon the facts upon which deductibility depends. Settlements are accepted if they are reached in bona fide negotiations between adverse parties with valid claims recognizable under applicable law, and if they are not inconsistent with the applicable law. A protective claim for refund may be filed before the expiration of the period of limitations for claims for refund in order to preserve the estate's right to claim a refund if the amount of a liability will not be ascertainable by the time of the expiration of the period of limitations for claims of refund. A deduction is not allowed to the extent the expense or claim is compensated for by insurance or is otherwise reimbursed. The proposed regulations further provide that no deduction may be taken on an estate tax return for a claim that is potential, unmatured, or contested at the time the return is filed. A protective claim for refund may be filed before the expiration of the period of limitations for claims for refund in order to preserve the estate's right to claim a refund by reason of the deduction of a claim against the estate to the extent that claim is ultimately paid by the estate. Additional provisions in the proposed regulations provide guidance for other particular circumstances. When a claim against an estate lists multiple defendants, the estate may only deduct the decedent's portion of the liability. Claims by family members or beneficiaries of a decedent's estate will be strictly scrutinized to ensure that they are legitimate claims. If a claim becomes unenforceable after the decedent's death, the estate may not take a section 2053(a)(3) deduction with respect to the claim. If a claim represents a decedent's obligation to make recurring payments that will likely continue for a period extending beyond the final determination of the estate tax liability, a deduction is allowed only as each payment is made, provided the period of limitations for claims for refund has not expired or the estate has properly preserved the claim for refund. Alternatively, a deduction is allowed for the cost of a commercial annuity purchased by the estate from an unrelated dealer in commercial annuities in satisfaction of that obligation. Finally, the proposed regulations reflect changes made to section 2053(d) and the enactment of section 2058 in 2001 and clarify that the rules in section 20.2053-9 apply only to the estates of decedents dying on or before December 31, 2004. Proposed Effective Date The regulations, as proposed, apply to the estate of any decedent dying on or after the date final regulations are published in the **Federal Register** . Special Analyses It has been determined that this notice of proposed rulemaking is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It has also been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations, and because these regulations do not impose a collection of information on small entities, the Regulatory Flexibility Act (5 U.S.C. chapter 6) does not apply. Therefore, a Regulatory Flexibility Analysis is not required. Pursuant to section 7805(f) of the Code, this notice of proposed rulemaking will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business. Comments and Public Hearing Before these proposed regulations are adopted as final regulations, consideration will be given to any written (a signed original and eight
(8)copies) or electronic comments that are submitted timely to the IRS. The IRS and the Treasury Department also request comments on the clarity of the proposed rules and how they can be made easier to understand. All comments will be available for public inspection and copying. A public hearing has been scheduled for August 6, 2007, at 10 a.m. in the IRS Auditorium, Internal Revenue Service, 1111 Constitution Avenue, NW., Washington, DC. Due to building security procedures, visitors must enter at the Constitution Avenue entrance. In addition, all visitors must present photo identification to enter the building. Because of access restrictions, visitors will not be admitted beyond the immediate entrance area more than 30 minutes before the hearing starts. For information about having your name placed on the building access list to attend the hearing, see the FOR FURTHER INFORMATION CONTACT section of this preamble. The rules of 26 CFR 601.601(a)(3) apply to the hearing. Persons who wish to present oral comments at the hearing must submit electronic or written comments by July 16, 2007, and an outline of the topics to be discussed and the time to be devoted to each topic (signed original and eight
(8)copies) by July 30, 2007. A period of 10 minutes will be allotted to each person for making comments. An agenda showing the scheduling of the speakers will be prepared after the deadline for receiving outlines has passed. Copies of the agenda will be available free of charge at the hearing. Drafting Information The principal author of these proposed regulations is DeAnn K. Malone, Office of the Chief Counsel, IRS. List of Subjects in 26 CFR Part 20 Estate taxes, Reporting and recordkeeping requirements. Proposed Amendments to the Regulations Accordingly, 26 CFR part 20 is proposed to be amended as follows: PART 20—ESTATE TAX; ESTATES OF DECEDENTS DYING AFTER AUGUST 16, 1954 **Paragraph 1** . The authority citation for part 20 continues to read in part as follows: Authority: 26 U.S.C. 7805. * * * **Par. 2** . Section 20.2051-1 is revised to read as follows: § 20.2051-1 Definition of taxable estate.
(a)The taxable estate of a decedent who was a citizen or resident (see § 20.0-1(b)(1)(i)) of the United States at death is determined by subtracting the total amount of the deductions authorized by sections 2052 through 2058 from the total amount which must be included in the gross estate under sections 2031 through 2044. These deductions are in general as follows:
(1)An exemption of $60,000 (section 2052) (applicable only to the estates of decedents dying on or before December 31, 1976).
(2)Funeral and administration expenses and claims against the estate (including certain taxes and charitable pledges) (section 2053).
(3)Losses from casualty or theft during the administration of the estate (section 2054).
(4)Charitable transfers (section 2055).
(5)The marital deduction (section 2056).
(6)Qualified domestic trusts (section 2056A).
(7)Family-owned business interests (section 2057) (applicable only to the estates of decedents dying on or before December 31, 2003).
(8)State death taxes (section 2058) (applicable only to the estates of decedents dying after December 31, 2004).
(b)See section 2106 and these regulations for the computation of the taxable estate of a decedent who was not a citizen or resident of the United States. See also § 1.642(g)-1 of this chapter concerning the disallowance for income tax purposes of certain deductions allowed for estate tax purposes.
(c)*Effective date.* The rules of this section apply to the estates of decedents dying on or after the date of publication of the Treasury decision adopting these rules as final regulations in the **Federal Register** . **Par. 3** . Section 20.2053-1 is amended by: 1. Revising the introductory text of paragraph (a). 2. Adding two new sentences at the end of paragraph (b)(1). 3. Revising paragraph (b)(2). 4. Redesignating paragraph (b)(3) as (b)(4) and revising the newly-designated paragraph (b)(4). 5. Adding new paragraphs (b)(3), (b)(5), (b)(6), and (e). The revisions and additions read as follows: § 20.2053-1 Deductions for expenses, indebtedness, and taxes; in general.
(a)*General rule.* In determining the taxable estate of a decedent who was a citizen or resident of the United States at death, there are allowed as deductions under section 2053(a) and
(b)amounts falling within the following two categories (subject to the limitations contained in this section and in §§ 20.2053-2 through 20.2053-10):
(b)* * *
(1)* * * In order to properly take into account events occurring after the date of a decedent's death when determining the amount deductible against a decedent's estate, the deduction for any item described in paragraph
(a)of this section is limited to the total amount actually paid (subject to any time requirement under paragraph
(a)of this section) in settlement or satisfaction of that item. (See however, § 20.2053-1(b)(4) for a special rule for deducting certain estimated amounts.)
(2)*Effect of court decree* —(i) *In general.* If the court with appropriate jurisdiction over the administration of the estate reviews and approves expenditures for funeral expenses, administration expenses, claims against the estate, or unpaid mortgages as allowable estate expenditures under local law, the executor may rely on the final judicial decision in that matter to determine the amount deductible for estate tax purposes if the following conditions are satisfied: The expenditures are otherwise deductible under section 2053 and the corresponding regulations; the expenditures have been paid by the estate or meet the requirements for estimated expenses; the court reviewed the facts relating to the expenditures; and the court's decision is consistent with local law. See § 20.2053-2 for additional rules regarding the deductibility of funeral expenses. See § 20.2053-3 for additional rules regarding the deductibility of administration expenses. See § 20.2053-4 for additional rules regarding the deductibility of claims against the estate. See § 20.2053-7 for additional rules regarding the deductibility of unpaid mortgages. If the decision reached by the court is inconsistent with local law, the estate may not rely on the court's decree to establish the amount deductible for estate tax purposes. For example, a local court decree approving an allowance made to an executor in excess of the amount or limit prescribed by statute may not be relied upon to establish the amount deductible under section 2053. An estate will not be denied an otherwise allowable deduction under section 2053 solely because a local court decree has not been entered with respect to that amount if the amount would be allowable under local law and if no court decree is required under applicable law for payment.
(ii)*Consent decree.* An executor may rely on a local court decree rendered by consent to establish the amount deductible under section 2053 for amounts paid (or meeting the requirements for estimated expenses) if the consent was a bona fide recognition of the validity of the claim and was accepted by the court as satisfactory evidence upon the merits. Consent given by all parties having interests adverse to that of the claimant will be presumed to be recognition of the claim's validity. See § 20.2053-4(b)(4) for special rules to determine the amount deductible for claims by decedent's family members, related entities, or beneficiaries of the decedent's estate or revocable trust.
(3)*Settlements.* An executor may rely on a settlement to establish the amount deductible under section 2053 for amounts paid (or meeting the requirements for estimated expenses) (subject to any applicable time limitation under paragraph
(a)of this section) if the following conditions are satisfied: The settlement resolves a bona fide issue in an active and genuine contest; the settlement is the product of arm's length negotiations by parties having adverse interests with respect to the claim; and the settlement is within the range of reasonable outcomes under applicable state law governing the issues resolved by the settlement. A settlement that results in a compromise between the positions of such adverse parties and reflects the parties' assessments of the relative strengths of their respective positions is a settlement that is within the range of reasonable outcomes. However, a deduction for amounts paid in settlement of a claim against the decedent's estate will not be allowed if the terms of the settlement are inconsistent with applicable local law. No deduction will be allowed for amounts paid in settlement of an unenforceable claim. See § 20.2053-4(b)(4) for special rules to determine the amount deductible for claims by decedent's family members, related entities, or beneficiaries of the decedent's estate or revocable trust. For settlements structured using recurring payments, see § 20.2053-4(b)(7).
(4)*Estimated amounts.* A deduction will be allowed for a claim that satisfies all applicable requirements even though its exact amount is not then known, provided that the amount is ascertainable with reasonable certainty, and will be paid. Under this exception to the rule set forth in paragraph (b)(1) of this section, no deduction may be taken upon the basis of a vague or uncertain estimate. If a deduction is allowed in advance of payment and the payment is thereafter waived or otherwise left unpaid, it shall be the duty of the executor to notify the Commissioner and to pay the resulting tax, together with interest. To the extent that the amount of a liability otherwise deductible under section 2053 is not ascertainable with reasonable certainty at the time of examination of the return by the Commissioner, or to the extent that it is not then clear that the amount will be paid, that amount will not be allowed as a deduction by the Commissioner. If the deduction is disallowed in whole or in part on examination of the return and the amount of the liability is subsequently ascertained and paid, relief may be sought by a timely claim for refund as provided by section 6511. A protective claim for refund may be filed before the expiration of the period of limitations for claims for refund in order to preserve the estate's right to claim a refund if the amount of a liability was or will not be paid before the expiration of the period of limitations for claims for refund. Although the protective claim need not state a particular dollar amount or demand an immediate refund, the protective claim must identify the outstanding liability or claim that would have been deductible under section 2053(a) had it already been paid. The protective claim must also describe the reasons and contingencies delaying the determination of the liability or the actual payment of the claim. Action on protective claims will proceed after the executor has notified the Commissioner that the contingency has been resolved.
(5)*Reimbursements.* A deduction is not allowed to the extent that the expense or claim is or could be compensated for by insurance or otherwise reimbursed.
(6)*Examples.* The following examples illustrate the application of this section. Assume that the amounts are payable out of property subject to claims and are allowable by the law of the jurisdiction governing the administration of the estate, whether the applicable jurisdiction is within or without the United States. Example 1. *Estimated amounts, deduction ascertainable.* Decedent's (D's) estate was probated in state. State law provides that the personal representative shall receive compensation equal to 2.5 percent of the value of the probate estate. The executor
(E)may claim a deduction for estimated fees equal to 2.5 percent of D's probate estate on the estate tax return filed for D's estate as an estimated amount, provided the amount will be paid to E after the estate tax return is filed. To the extent that, at the time of the examination of the return, the amount has not been paid and E cannot satisfy the conditions listed in paragraph (b)(4) of this section and § 20.2053-3(b)(1), the deduction will be disallowed, but the executor may file a timely protective claim for refund to protect the estate's right to a refund once the amount has been paid or satisfies the applicable conditions. If the deduction is allowed in advance of payment and the payment is thereafter waived or otherwise left unpaid, it shall be the duty of the executor to notify the Commissioner and to pay the resulting tax, together with interest. Example 2. *Estimated amounts, deduction not ascertainable.* Prior to death, Decedent
(D)is sued by Claimant
(C)for $100× in a tort proceeding and responds asserting affirmative defenses available to D under applicable local law. C and D are unrelated. D subsequently dies and D's Form 706 is due before a final judgment is entered in the case. The executor
(E)of D's estate may not take a deduction for $100× on D's estate tax return as an estimated amount because the deductible amount cannot be ascertained with reasonable certainty in accordance with § 20.2053-4(b)(2). If the amount of the actual liability will not be paid or cannot be ascertained with reasonable certainty before the expiration of the period of limitations for claims for refund, E may file a protective claim before that date in order to preserve the estate's right subsequently to claim a refund.
(e)*Effective date.* The rules of this section apply to the estates of decedents dying on or after the date of publication of the Treasury decision adopting these rules as final regulations in the **Federal Register** . **Par. 4** . Section 20.2053-3 is amended by: 1. Redesignating paragraphs (b)(2) and (b)(3) as paragraphs (b)(4) and (b)(5), respectively. 2. Designating the undesignated text following paragraph (b)(1) as new paragraph (b)(3). 3. Revising paragraphs (b)(1) and (c)(1). 4. Adding new paragraphs (b)(2), (d)(3) and (e). The revisions and additions read as follows: § 20.2053-3 Deductions for expenses of administering estate.
(b)*Executor's commissions.*
(1)The executor, in filing the estate tax return, may deduct executor's commissions in such an amount as has actually been paid, or in an amount which at the time of filing the estate tax return may reasonably be expected to be paid, but no deduction may be taken if no commissions are to be collected. If the amount of the commissions has not been fixed by decree of the proper court, the deduction will be allowed on the examination of the return, to the extent that all three of the following conditions are satisfied:
(i)The Commissioner is reasonably satisfied that the commissions claimed will be paid.
(ii)The amount claimed as a deduction is within the amount allowable by the laws of the jurisdiction in which the estate is being administered.
(iii)It is in accordance with the usually accepted practice in the jurisdiction to allow such an amount in estates of similar size and character.
(2)If the conditions described in paragraph (b)(1) of this section are not met, a protective claim for refund may be filed before the expiration of the period of limitations for claims for refund in order to preserve the estate's right to claim a refund for future amounts paid as described in § 20.2053-1(b)(4).
(3)If the deduction is disallowed in whole or in part on the examination of the return and a protective claim was timely filed, the disallowance will be subject to modification once the requirements for deductibility are met. If the deduction is allowed in advance of payment and payment is thereafter waived or otherwise left unpaid, it shall be the duty of the executor to notify the Commissioner and to pay the resulting tax, together with interest.
(c)*Attorney's fees.*
(1)The executor, in filing the estate tax return, may deduct such an amount of attorney's fees as has actually been paid, or an amount which at the time of filing may reasonably be expected to be paid. If on the examination of the return, the fees claimed have not been awarded by the proper court and paid, the deduction will, nevertheless, be allowed, if the Commissioner is reasonably satisfied that the amount claimed will be paid and that it does not exceed a reasonable remuneration for the services rendered, taking into account the size and character of the estate and the local law and practice. If the amount does not satisfy these requirements, a protective claim for refund may be filed before the expiration of the period of limitations for claims for refund in order to preserve the estate's right to claim a refund for future amounts paid as described in § 20.2053-1(b)(4). If the deduction is disallowed in whole or in part on the examination of the return and a protective claim was timely filed, the disallowance will be subject to modification once the requirements for deductibility are met.
(d)* * *
(3)Expenses incurred in defending the estate against claims described in section 2053(a)(3) are deductible as provided in § 20.2053-1 if the expenses are incurred incident to the assertion of defenses to the claim available under the applicable law, even if the estate is not ultimately victorious. For purposes of this section, “expenses incurred in defending the estate against claims” include costs relating to the arbitration and mediation of contested issues, costs associated with defending the estate against claims (whether or not enforceable), and costs associated with reaching a negotiated settlement of the issues. Expenses incurred merely for the purpose of unreasonably extending the time for payment, or incurred other than in good faith, are not deductible.
(e)*Effective date.* The rules of this section apply to the estates of decedents dying on or after the date of publication of the Treasury decision adopting these rules as final regulations in the **Federal Register** . **Par. 5** . Section 20.2053-4 is revised to read as follows: § 20.2053-4 Deduction for claims against the estate.
(a)*In general.*
(1)For purposes of this section, liabilities imposed by law or arising out of contracts or torts are deductible if they meet the requirements set forth in § 20.2053-1 and this section. Except as provided in paragraph
(b)of this section, the amounts that may be deducted as claims against a decedent's estate are limited to amounts for legitimate and bona fide claims that—
(i)Represent personal obligations of the decedent existing at the time of the decedent's death;
(ii)Are enforceable against the decedent's estate at the time of payment; and
(iii)Are actually paid by the estate in settlement of the claim.
(2)Events occurring after the date of a decedent's death shall be considered when determining the amount deductible against a decedent's estate.
(b)*Special rules* —(1) *Potential and unmatured claims.* Claims that are unmatured on the date of the decedent's death and that later mature and are paid are deductible by the estate. However, no deduction may be taken on an estate tax return for a potential or unmatured claim. If the claim matures and is paid prior to the expiration of the period of limitations for filing a claim for refund, the estate may file a claim for refund as provided by section 6511. A protective claim for refund may be filed before the expiration of the period of limitations for claims for refund in order to preserve the estate's right to claim a refund once the claim against the decedent's estate is matured and is paid or may be estimated as provided in § 20.2053-1(b)(4). Although the protective claim need not state a particular dollar amount or demand an immediate refund, the protective claim must identify the outstanding liability or claim that would have been deductible under section 2053(a) had it already been paid, and must describe the reasons and contingencies delaying actual payment of the liability or claim. Action on protective claims will proceed after the executor has notified the Commissioner that the contingency has been resolved.
(2)*Contested claims.* No deduction may be taken on an estate tax return for a claim against the decedent's estate to the extent the estate is contesting the decedent's liability. However, see § 20.2053-1(b)(4) relating to estimated amounts.
(3)*Claims against multiple parties.* If the decedent or the decedent's estate is one of two or more parties against whom the claim is being asserted, the estate may only deduct the portion of the total claim due from and paid by the estate, reduced by the total of any reimbursement received from another party, insurance, or otherwise. The estate's deductible portion will also be reduced by the amount or contribution the estate could have collected from another party or an insurer but which the estate declines or fails to attempt to collect. If, however, the estate establishes that the burden of necessary collection efforts would have outweighed the benefit from those efforts, the potential reimbursement will not reduce the estate's deductible portion of the total claim. If the estate establishes that the party from whom a potential reimbursement could be collected could only pay a portion of the potential reimbursement, then only that portion that could reasonably have been expected to be collected will reduce the estate's deductible portion of the total claim.
(4)*Claims by family members, related entities, or beneficiaries.* Relationships with and among a decedent and the decedent's family members, related entities, and beneficiaries may create the potential for collusion in asserting invalid or exaggerated claims in order to reduce the decedent's taxable estate. Thus, notwithstanding § 20.2053-1 and paragraph
(a)of this section, there will be a rebuttable presumption that claims by a family member of the decedent, a related entity, or a beneficiary of the decedent's estate or revocable trust are not legitimate and bona fide and therefore are not deductible. Evidence sufficient to rebut the presumption may include evidence that the claim arises from circumstances that would reasonably support a similar claim by unrelated persons or non-beneficiaries. Similarly, a settlement between a decedent's estate or revocable trust and a family member, a related entity, or a beneficiary of the decedent's estate or revocable trust will be presumed to not be deductible absent evidence of the legitimacy and bona fide nature of the claim. For purposes of this section, family members include the spouse of the decedent; the grandparents, parents, siblings, and lineal descendants of the decedent or of the decedent's spouse; and the spouse and lineal descendants of any such grandparent, parent, and sibling. Family members include adopted individuals. For purposes of this section, a related entity is an entity in which the decedent, either directly or indirectly, had a beneficial ownership interest at the time of the decedent's death or at any time during the three-year period ending on the decedent's date of death. Such an entity, however, shall not include a publicly-traded entity nor shall it include a closely-held entity in which the combined beneficial interest, either direct or indirect, of the decedent and the decedent's family members, collectively, is less than thirty percent of the beneficial ownership interests (whether voting or non-voting).
(5)*Unenforceable claims.* Claims that are unenforceable prior to or at the decedent's death are not deductible, even if they are actually paid. Claims that become unenforceable during the administration of the estate are not deductible to the extent that they are paid after they become unenforceable. To the extent that enforceability of a claim is at issue, see paragraph (b)(2) of this section relating to contested claims.
(6)*Claims founded upon a promise.* Except with regard to pledges or subscriptions, (see § 20.2053-5), section 2053(c)(1)(A) provides that the deduction for a claim founded upon a promise or agreement is limited to the extent that the promise or agreement was bona fide and in exchange for adequate and full consideration in money or money's worth. For this purpose, bona fide and for adequate and full consideration in money or money's worth requires that the promise or agreement must have been made in good faith, and that the price must have been an adequate and full equivalent reducible to a money value.
(7)*Recurring payments* —(i) *Non-Contingent obligations.* If a decedent is obligated to make recurring payments on an enforceable and certain claim that are not subject to a contingency and if the payments will continue for a period that will likely extend beyond the final determination of the estate tax liability, the obligation may be deducted as an estimated amount using the rules in § 20.2053-1. The amount deductible is the present value of the payments on the decedent's date of death as determined under § 20.2031-7(d). See §§ 20.7520-1 through 20.7520-4. If there is a reasonable likelihood that full satisfaction of the liability will not be made, then the obligation will be deemed to be subject to a contingency for purposes of this section.
(ii)*Contingent obligations.* If a decedent has a recurring obligation to pay an enforceable and certain claim, but the decedent's obligation is subject to a contingency or is otherwise not described in paragraph (b)(7)(i) of this section, the estate's deduction is limited to amounts actually paid by the estate in satisfaction of the claim.
(iii)*Purchase of commercial annuity to satisfy recurring obligation to pay.* If a decedent has a recurring obligation (whether or not contingent) to pay an enforceable and certain claim and the estate purchases a commercial annuity from an unrelated dealer in commercial annuities in an arms-length transaction to satisfy the obligation, the amount deductible by the estate is the sum of—
(A)The amount paid for the commercial annuity; and
(B)Any amount actually paid to the claimant by the estate prior to the purchase of the commercial annuity.
(c)*Interest on claims.* The interest on a deductible claim is itself deductible as a claim under section 2053, but only to the extent of the amount of interest accrued at the date of the decedent's death and actually paid, even if the executor elects the alternate valuation method under section 2032. (Post-death accrued interest may be deductible in appropriate circumstances either as an estate tax administration expense under section 2053 or as an income tax deduction.)
(d)*Examples.* The following examples illustrate the application of paragraphs
(a)through
(c)of this section. Except as is otherwise provided in the examples, assume that the claimant
(C)is not a family member, related entity or beneficiary of the decedent
(D)and is not the executor (E). Assume that a claim represents a personal obligation of D existing at the time of D's death and is enforceable against D's estate. Assume that the payment of the claim, where applicable, is made out of property subject to claims (as defined in section 2053(c)(2) and § 20.2053-1(c)(2)) and is allowable by the law of the jurisdiction under which the decedent's estate is being administered, or is paid prior to the filing of the estate tax return (including any extension granted under section 6081) from property not subject to claims. Assume that any court decree is based upon the facts upon which deductibility depends and is consistent with applicable local law. Assume that any settlement is reached in bona fide negotiations between or among parties having adverse interests with respect to the claim and that the terms of the settlement are not inconsistent with applicable local law. Example 1. *Contested claim, single defendant, no decision.* D is sued by C for $100x in a tort proceeding and responds asserting affirmative defenses available to D under applicable local law. D dies and E is substituted as defendant in the suit. D's estate tax return is due before a judgment is reached in the case. D's gross estate includes only property subject to claims and exceeds $100x. E may not take a deduction on the return for the claim under section 2053(a)(3). A deduction may be claimed on the return, however, for expenses incurred prior to the filing of the estate tax return in defending the estate against the claim if the expenses have been paid in accordance with § 20.2053-3(c) or (d)(3) or as an estimate under § 20.2053-1(b)(4). E may file a protective claim for refund before the expiration of the period of limitations for claims for refund of the estate tax in order to preserve the estate's right to claim a refund if the amount of the liability will not be paid or cannot be ascertained with reasonable certainty by the expiration of that period of limitations. If payment is subsequently made pursuant to a court decision or a settlement, a deduction for the payment, as well as expenses incurred incident to the claim and not previously deducted, may be taken and relief may be sought by supplementing a previously filed protective claim or by filing a claim for refund as provided by section 6511. Example 2. *Contested claim, single defendant, final court decree and payment.* The facts are the same as in *Example 1* except that, before the return is timely filed, the court enters a decision in favor of C, no timely appeal is filed, and payment is made. A deduction is allowed for the amount paid in satisfaction of the claim pursuant to the final decision of the local court, including any interest accrued prior to D's death, under section 2053(a)(3). In addition, a deduction may be available under § 20.2053-3(d)(3) for expenses incurred prior to the filing of the estate tax return in defending the estate against the claim and in processing payment of the claim. Example 3. *Contested claim, single defendant, settlement and payment.* The facts are the same as in *Example 1* except that, before the return is timely filed, a settlement is reached between D's estate and C for $80x and payment is made. A deduction is allowed for the amount of the settlement paid to C ($80x) under section 2053(a)(3). In addition, a deduction may be available under § 20.2053-3(d)(3) for expenses incurred prior to the filing of the estate tax return in defending the estate, reaching a settlement, and processing payment of the claim. Example 4. *Contested claim, multiple defendants.* The facts are the same as in *Example 1* except that the suit filed by C lists D and K, an unrelated third-party, as defendants. If the claim is not resolved prior to the time the estate tax return is filed, E may not take a deduction for the claim under section 2053(a)(3) on the return. If payment is subsequently made of D's share of the claim pursuant to a court decision or a settlement holding D liable for 40 percent of the amount due and K liable for 60 percent of the amount due, then the estate may take a deduction for the amount paid in satisfaction of the claim representing D's share of the liability as assigned by the court decree ($40x), plus any interest on that share accrued prior to D's death, under section 2053(a)(3). If the court decision finds D and K jointly and severally liable for the entire $100x and D's estate pays the entire $100x but could have reasonably collected $50x from K in reimbursement, the estate may take a deduction under section 2053(a)(3) and paragraph (b)(3) of this section for only $50x and the interest on $50x accrued prior to D's death. In both instances, a deduction may also be available under § 20.2053-3(d)(3) for expenses incurred and not previously deducted in defending the estate against the claim and processing payment of the amount due from D. Example 5. *Contested claim, multiple defendants, settlement and payment.* The facts are the same as in *Example 1* except that the suit filed by C lists D and K, an unrelated third-party, as defendants. D's estate settles with C for $10x and payment is made before the return is timely filed. E may take a deduction for the amount paid to C in satisfaction of the claim. In addition, a deduction may be available under § 20.2053-3(d)(3) for expenses incurred prior to the filing of the estate tax return in defending the estate, reaching a settlement, and processing payment of the claim. Example 6. *Mixed claims.* During life, D contracts with C to perform specific work on D's home for $75x. Under the contract, additional work must be approved in advance by D. C performs additional work and sues D for $100x for work completed including the $75x agreed to in the contract. D dies and D's estate tax return is due before a judgment is reached in the case. E contests liability for $25x. E may take a deduction on the return for $75x if it has been paid or if it meets the requirements of an estimated amount. In addition, a deduction may be claimed on the return for expenses incurred in defending the estate against the claim if they have been paid under § 20.2053-3(c) or (d)(3) or as an estimate under § 20.2053-1(b)(4). E may file a protective claim for refund before the expiration of the period of limitations on claims for refund of the estate tax in order to preserve the estate's right to claim a refund if payment on any amount in excess of $75x is subsequently made in resolution of a claim that would qualify for a deduction under section 2053. To the extent that the expenses incurred in defending the estate against the claim are not deducted as an estimate, they may be included in the protective claim for refund. Example 7. *Unenforceable claims.* D is sued by C for $100x in a tort proceeding but the claim is barred by the applicable period of limitations and there is no other recourse available to C. A deduction is not allowed for the claim under section 2053(a)(3) whether or not the estate actually pays money in satisfaction of the claim. A deduction may be available, however, under § 20.2053-3(d)(3) for expenses incurred in defending the estate against the claim. Example 8. *Non-contingent and recurring obligation to pay, binding on estate.* D's property settlement agreement incident to D's divorce, signed three years prior to D's death, obligates D or D's estate to pay to S, D's former spouse, $20x per year for 10 years. The payments are not conditioned on whether or not S remarries. If S dies prior to the last payment, the terms of the agreement state that the remaining payments are to be made to S's estate or as S may appoint in S's will. Prior to filing D's estate tax return, D's estate pays the first of the 7 payments remaining as of D's death. The estate may take a deduction for the present value of these payments. See §§ 20.7520-1 through 20.7520-4. Example 9. *Contingent recurring obligation to pay, binding on estate.* D's property settlement agreement incident to D's divorce, signed three years prior to D's death, obligates D or D's estate to pay to S, D's former spouse, $20x per year for 10 years. The obligation to make the annual payments ceases upon S's remarriage or S's death prior to the due date of the last payment. Prior to filing D's estate tax return, D's estate pays the first of the 7 payments remaining as of D's death. E may take as a deduction on the return the amount of the 1 payment made prior to the filing of D's estate tax return. Additional payments become deductible as they are paid. E may file a protective claim for refund before the expiration of the period of limitations for claims for refund of the estate tax in order to preserve the estate's right to claim a refund if the amount of the liability will not be paid or is not ascertainable with reasonable certainty by the expiration of the applicable period of limitations. If the total amount to be paid in satisfaction of the liability is not ascertainable with reasonable certainty at the time of examination of the return, relief may be sought by a claim for refund (either actual or protective) as provided by section 6511. Example 10. *Recurring obligation to pay, estate purchases a commercial annuity in satisfaction.* D's property settlement agreement incident to D's divorce, signed three years prior to D's death, obligates D or D's estate to pay to S, D's former spouse, $20x per year for 10 years. D's estate purchases a commercial annuity from an unrelated dealer in commercial annuities, XYZ, in a bona fide sale to satisfy the obligation to S. E may deduct the entire amount paid to XYZ to obtain the annuity, regardless of whether or not the obligation to S was contingent.
(e)*Effective date.* The rules of this section apply to the estates of decedents dying on or after the date of publication of the Treasury decision adopting these rules as final regulations in the **Federal Register** . **Par. 6** . Section 20.2053-6 is amended by revising paragraphs
(a)and
(c)and adding new paragraphs
(g)and
(h)to read as follows: § 20.2053-6 Deduction for taxes.
(a)*In general.* Taxes are deductible in computing a decedent's gross estate only as claims against the estate (except to the extent that excise taxes may be allowable as administration expenses), and only to the extent not disallowed by section 2053(c)(1)(B) (see the remaining paragraphs of this section). However, see §§ 20.2053-9 and 20.2053-10 with respect to the deduction allowed for certain state and foreign death taxes.
(c)*Death taxes.*
(1)For the estates of decedents dying on or before December 31, 2004, no estate, succession, legacy or inheritance tax payable by reason of the decedent's death is deductible, except as provided in § 20.2053-9 and § 20.2053-10 with respect to certain state and foreign death taxes on transfers for charitable, etc., uses. However, see sections 2011 and 2014 and these regulations with respect to credits for death taxes.
(2)For the estates of decedents dying after December 31, 2004, see section 2058 to determine the deductibility of state death taxes.
(g)*Post-death adjustments of deductible tax liability.* Post-death adjustments increasing a tax liability accrued prior to the decedent's death, including increases of taxes deducted under this section, will increase the amount of the deduction taken under section 2053(a)(3) for that tax liability. Similarly, any refund subsequently determined to be due to and received by the estate with respect to taxes deducted by the estate under this section reduces the amount of the deduction taken for that tax liability under section 2053(a)(3). Expenses associated with defending the estate against the increase in tax liability or with obtaining the refund may be deductible under § 20.2053-3(d)(3). A protective claim for refund of estate taxes may be filed before the expiration of the period of limitations for claims for refund in order to preserve the estate's right to claim a refund if the amount of a deductible tax liability may be affected by such an adjustment or refund. The application of this section may be illustrated by the following examples: Example 1. *Increase in tax due.* After the decedent's death, the Internal Revenue Service examines the gift tax return filed by the decedent in the year before the decedent's death and asserts a deficiency of $100x. The estate spends $30x in a non-frivolous defense against the increased deficiency. The final determination of the deficiency, in the amount of $90x, is paid by the estate. The estate may deduct $90× under section 2053(a)(3) and $30x under § 20.2053-3(c)(2) or (d)(3). Example 2. *Refund of taxes paid.* Decedent's estate timely files D's individual income tax return for the year in which the decedent died. The estate timely pays the entire amount of the tax due, $50x, as shown on that return. The entire $50x was attributable to income received prior to the decedent's death. Decedent's estate subsequently discovers an error on the income tax return and files a timely claim for refund. Decedent's estate receives a refund of $10x. The estate is only allowed a deduction of $40x under section 2053(a)(3) for the income tax liability accrued prior to the decedent's death. If a deduction for $50x was allowed on the estate tax return prior to the receipt of the refund, it shall be the duty of the executor to notify the Commissioner of the change and to pay the resulting tax, with interest.
(h)*Effective date.* The rules of this section apply to the estates of decedents dying on or after the date of publication of the Treasury decision adopting these rules as final regulations in the **Federal Register** . **Par. 7** . Section 20.2053-9 is amended as follows: 1. Revising the heading for paragraph
(a)and adding a sentence at the end of paragraph (a). 2. Revising the first and last sentences of paragraph (c). 3. Adding new paragraph (f). The revisions and addition read as follows: § 20.2053-9 Deduction for certain state death taxes.
(a)*General rules for the estates of decedents dying on or before December 31, 2004.* * * * For the estates of decedents dying after December 31, 2004, see section 2058 to determine the deductibility of state death taxes.
(c)*Exercise of election.* The election to take a deduction for a state death tax imposed upon a transfer for charitable, etc., uses shall be exercised by the executor by the filing of a written notification to that effect with the Commissioner. * * * The election may be revoked by the executor by the filing of a written notification to that effect with the Commissioner at any time before the expiration of such period.
(f)*Effective date.* The rules of this section apply to the estates of decedents dying on or before December 31, 2004. **Par. 8** . Section 20.2053-10 is amended by revising paragraph
(c)and adding a new paragraph
(e)to read as follows: § 20.2053-10 Deduction for certain foreign death taxes.
(c)*Exercise of election.* The election to take a deduction for a foreign death tax imposed upon a transfer for charitable, etc., uses shall be exercised by the executor by the filing of a written notification to that effect with the Commissioner. An election to take the deduction for foreign death taxes is deemed to be a waiver of the right to claim a credit under a treaty with any foreign country for any tax or portion thereof claimed as a deduction under this section. The notification shall be filed before the expiration of the period of limitations for assessment provided in section 6501 (usually 3 years from the last day for filing the return). The election may be revoked by the executor by the filing of a written notification to that effect with the Commissioner at any time before the expiration of such period.
(e)*Effective date.* The rules of this section apply to the estates of decedents dying on or after the date of publication of the Treasury decision adopting these rules as final regulations in the **Federal Register** . Kevin M. Brown, Deputy Commissioner for Services and Enforcement. [FR Doc. E7-7601 Filed 4-20-07; 8:45 am] BILLING CODE 4830-01-P DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [CGD13-07-009] RIN 1625-AA00 Safety Zones: Fireworks Displays in the Captain of the Port Portland Zone AGENCY: Coast Guard, DHS. ACTION: Notice of proposed rulemaking. SUMMARY: The Coast Guard is proposing to amend its regulations to establish additional safety zones on the waters of the Columbia River located in the Area of Responsibility
(AOR)of the Captain of the Port, Portland, Oregon during annual fireworks displays. The Captain of the Port, Portland Oregon is taking this action to safeguard watercraft and their occupants from safety hazards associated with these displays. Entry into these zones is prohibited unless authorized by the Captain of the Port. DATES: Comments and related material must reach the Coast Guard on or before May 23, 2007. ADDRESSES: You may mail comments and related material to Petty Officer Michelle Duty at Sector Portland 6767 N. Basin Ave., Portland, OR 97217. Sector Portland maintains the public docket for this rulemaking. Comments and material received from the public, as well as documents indicated in this preamble as being available in the docket, will become part of this docket and will be available for inspection or copying at Sector Portland between 8 a.m. and 4 p.m., Monday through Friday, except Federal holidays. FOR FURTHER INFORMATION CONTACT: Petty Officer Michelle Duty, c/o Captain of the Port, Portland 6767 N. Basin Avenue, Portland, Oregon 97217, 503-240-2590. SUPPLEMENTARY INFORMATION: Request for Comments We encourage you to participate in this rulemaking by submitting comments and related material. If you do so, please include your name and address, identify the docket number for this rulemaking (CGD13-07-009), indicate the specific section of this document to which each comment applies, and give the reason for each comment. Please submit all comments and related material in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying. If you would like to know they reached us, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them. Public Meeting We do not now plan to hold a public meeting. But you may submit a request for a meeting by writing to Sector Portland at the address under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the **Federal Register** . Background and Purpose The Coast Guard is proposing establish additional permanent safety zones to allow for safe annual fireworks displays. All events occur within the Captain of the Port, Portland, OR, Area of Responsibility (AOR). These events may result in a number of vessels congregating near fireworks launching barges and sites. The safety zones are needed to protect watercraft and their occupants from safety hazards associated with fireworks displays. These safety zones will be enforced by representatives of the Captain of the Port, Portland, Oregon. The Captain of the Port may be assisted by other federal and local agencies. Discussion of Proposed Rule This proposed rule, for safety concerns, will control vessels, personnel and individual movements in a regulated area surrounding the following fireworks events: Hillman 4th of July Fireworks Display, Vancouver WA; East County 4th of July Fireworks Gresham, OR; Port of Cascade Locks July 4th Display, Cascade Locks OR; Gladstone 4th of July Celebration, Gladstone, OR. Entry into these zones is prohibited unless authorized by the Captain of the Port, Portland or his designated representative. Captain of the Port, Portland, Oregon, will enforce these safety zones. The Captain of the Port may be assisted by other federal and local agencies. Regulatory Evaluation This proposed rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security (DHS). We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary. This expectation is based on the fact that the regulated areas established by the regulation will be of limited duration and encompass small portions of the Columbia River in the Portland AOR in the evening when vessel traffic is low. Small Entities Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. This proposed rule will affect the following entities, some of which may be small entities: The owners or operators of vessels intending to transit a portion of the Columbia River during the times mentioned in proposed regulation text § 165.1315(a)(15-18) at the conclusion of this proposed rule. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. These safety zones will not have significant economic impact on a substantial number of small entities for the following reasons. This rule will be in effect for only three hours during the evenings when vessel traffic is low. Traffic will be allowed to pass through the zone with the permission of the Captain of the Port or his designated representatives on scene, if safe to do so. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES ) explaining why you think it qualifies and how and to what degree this rule would economically affect it. Assistance for Small Entities Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance; please contact Petty Officer Michelle Duty by phone at 503-247-4015 or by e-mail at Michelle.K.Duty@uscg.mil. The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard. Collection of Information This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520.). Federalism A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such expenditure, we do discuss the effects of this proposed rule elsewhere in this preamble. Taking of Private Property This proposed rule would not affect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. Civil Justice Reform This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. Protection of Children We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children. Indian Tribal Governments This proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. Energy Effects We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211. Technical Standards The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( *e.g.* , specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies. This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards. Environment We have analyzed this proposed rule under Commandant Instruction M16475.lD, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969
(NEPA)(42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, this rule is categorically excluded, under figure 2-1, paragraph (34)(g), of the Instruction, from further environmental documentation. This rule establishes safety zones which have duration of no more than three hours each. A final “Environmental Analysis Check List” and a final “Categorical Exclusion Determination” will be available in the docket where indicated under ADDRESSES . List of Subjects in 33 CFR Part 165 Harbors, Marine safety, Navigation (water), Reporting and Recordkeeping Requirements, Security measures, Waterways. For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 165 as follows: PART 165—REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS 1. The authority citation for part 165 continues to read as follows: Authority: 33 U.S.C. 1226, 1231; 46 U.S.C. Chapter 701; 50 U.S.C. 191, 195; 33 CFR 1.05-1(g), 6.04-1, 6.04-6 and 160.5; Pub. L. 107-295, 116 Stat. 2064; Department of Homeland Security Delegation No. 0170.1. 2. Amend § 165.1315 by adding paragraphs (a)(15) through
(18)and (b)(2) to read as follows. § 165.1315 Safety Zones: Fireworks displays in the Captain of the Port Portland Zone.
(a)* * *
(15)Hillman 4th of July Fireworks Display, Vancouver WA:
(i)*Location.* All water of the Columbia River forming a 600 foot radius from the land launching point of: 45°35′46″ N, 122°32′22″ W.
(ii)*Enforcement Period.* This section is enforced annually on July fourth from approximately 8:30 p.m. to 11:30 p.m. (PDT).
(16)East County 4th of July Fireworks Gresham, OR
(i)*Location.* All water of the Columbia River forming a 600 foot radius from the land launching point: 45°33′ 33″ N, 122°27′03″ W in the vicinity of Blue Lake Park.
(ii)*Enforcement Period.* This section is enforced annually on July fourth from 8:30 p.m. to 11:30 p.m. (PDT).
(17)*Port of Cascade Locks July 4th Display, Cascade Locks OR. *
(i)*Location.* All water of the Columbia River forming a 600 foot radius from the land launching point: 45°40′16″ N 121°53′38″ W the North point of Thunder Island.
(ii)*Enforcement Period.* This section is enforced annually on July fourth from 8:30 p.m. to 11:30 p.m. (PDT).
(18)*Gladstone 4th of July Celebration, Gladstone, OR *
(i)*Location.* All water of the Columbia River forming a 800 foot radius from the land launching point: 45°22′21″ N, 122°36′34″ W.
(ii)*Enforcement Period.* This section is enforced annually on July fourth from 8:30 p.m. to 11:30 p.m. (PDT).
(b)* * *
(2)*Designated representative* means Coast Guard Patrol Commanders, including Coast Guard coxswains, petty officers or other officers operating Coast Guard vessel and a Federal, State, and local officers designated by or assisting the Captain of the Port Portland
(COTP)in the enforcement of the safety zone. Dated: March 20, 2007. Patrick G. Gerrity, Captain, U.S. Coast Guard, Captain of the Port, Portland, OR. [FR Doc. E7-7634 Filed 4-20-07; 8:45 am] BILLING CODE 4910-15-P DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [CGD09-07-013] RIN 1625-AA00 Safety Zone, Kenosha Harbor, Kenosha, WI AGENCY: Coast Guard, DHS. ACTION: Notice of proposed rulemaking. SUMMARY: The Coast Guard proposes to establish a temporary safety zone near Kenosha Harbor, Kenosha, Wisconsin. This zone is intended to control the movement of vessels on portions of Lake Michigan during the Spill Of National Significance
(SONS)exercise on June 19 and 20, 2007. This zone is necessary to protect the public from the hazards associated with ships and boats deploying oil containment equipment. DATES: Comments and related material must reach the Coast Guard on or before May 8, 2007. ADDRESSES: You may mail comments and related material to Commander, Coast Guard Sector Lake Michigan (spw), 2420 South Lincoln Memorial Drive, Milwaukee, WI 53207. The Sector Lake Michigan Prevention Department maintains the public docket for this rulemaking. Comments and material received from the public, as well as documents indicated in this preamble as being available in the docket, will become part of this docket and will be available for inspection or copying at the Sector Lake Michigan Prevention Department between 8 a.m. and 3 p.m., Monday through Friday, except Federal holidays. FOR FURTHER INFORMATION CONTACT: CWO Brad Hinken, Prevention Department, Coast Guard Sector Lake Michigan, Milwaukee, WI at
(414)747-7154. SUPPLEMENTARY INFORMATION: Request for Comments We encourage you to participate in this rulemaking by submitting comments and related material. If you do so, please include your name and address, identify the docket number for this rulemaking [CGD09-07-013], indicate the specific section of this document to which each comment applies, and give the reason for each comment. Please submit all comments and related material in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying. If you would like to know they reached us, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them. Public Meeting We do not now plan to hold a public meeting. But you may submit a request for a meeting by writing to the Sector Lake Michigan Prevention Department at the address under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the **Federal Register** . Background and Purpose This temporary safety zone is necessary to ensure the safety of vessels and people from hazards associated with numerous vessels deploying oil containment boom and conducting diving operations. Based on the experiences in other Captain of the Port zones, the Captain of the Port Lake Michigan has determined numerous vessels engaged in the deployment of oil containment boom in close proximity to watercraft pose significant risk to public safety and property. The likely combination of large numbers of recreation vessels and congested waterways could result in serious injuries or fatalities. Establishing a safety zone to control vessel movement around the location of the SONS exercise will help ensure the safety of persons and property at these events and help minimize the associated risks. The comment period for this rule is only 15 days because the request for the safety zone was not received in time to allow for a longer period. Delaying this rule would be contrary to the public interest of ensuring the safety of vessels during this event and immediate action is necessary to prevent possible loss of life or property. Discussion of Proposed Rule A temporary safety zone is necessary to ensure the safety of vessels during the deployment and recovery of oil containment boom in conjunction with the SONS exercise. The zone will be enforced between 8 a.m. (local) and 6 p.m. (local) on June 19 and 20, 2007. The safety zone for the SONS exercise will encompass all waters of Lake Michigan 2,300 yards north of Kenosha Breakwater Light (Lightlist number 20430) and from the shoreline to 1,500 yards east Kenosha Breakwater Light (Lightlist number 20430) and bounded by a line with of point origin at 42°36′29″ N, 087°47′17″ W; then west to 42°36′29″ N, 087°49′07″ W; then south along the shoreline to 42°35′19″ N, 087°48′41″ W; then east, northeast to 42°35′24″ N, 087°47′17″ W; then north to the point of origin (NAD 83). All persons and vessels shall comply with the instructions of the Coast Guard Captain of the Port or the designated on-scene representative. Entry into, transiting, or anchoring within the safety zone is prohibited unless authorized by the Captain of the Port Lake Michigan or his designated on-scene representative. The Captain of the Port or his designated on-scene representative may be contacted via VHF Channel 16. Regulatory Evaluation This proposed rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation is unnecessary. The Coast Guard will only use this safety zone for 10 hours a day on the two days specified. This safety zone has been designed to allow vessels to transit unrestricted to portions of the harbor not affected by the zone. The Captain of the Port will allow vessel to enter and depart Kenosha Harbor. The Coast Guard expects insignificant adverse impact to mariners from the activation of this zone. Small Entities Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities. This proposed rule would affect the following entities, some of which might be small entities: The owners of vessels intending to transits or anchor in a portion of Lake Michigan between 8 p.m. (local) and 6 p.m. (local) on June 19, 2007 and June 20, 2007. The safety zone would not have a significant economic impact on a substantial number of small entities for the following reasons. This rule would be in effect for only 20 hours. Vessel traffic can safely pass around the safety zone and enter and depart Kenosha Harbor. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES ) explaining why you think it qualifies and how and to what degree this rule would economically affect it. Assistance for Small Entities Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact CWO Brad Hinken, Prevention Department, Coast Guard Sector Lake Michigan, Milwaukee, WI at
(414)747-7154. The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard. Collection of Information This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). Federalism A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble. Taking of Private Property This proposed rule would not effect the taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. Civil Justice Reform This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. Protection of Children We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children. Indian Tribal Governments The Coast Guard recognizes the treaty rights of Native American Tribes. Moreover, the Coast Guard is committed to working with Tribal Governments to implement local policies and to mitigate tribal concerns. We have determined that this safety zone and fishing rights protection need not be incompatible. We have also determined that this proposed Rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. Nevertheless, Indian Tribes that have questions concerning the provisions of this Proposed Rule or options for compliance are encourage to contact the point of contact listed under FOR FURTHER INFORMATION CONTACT . Energy Effects We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211. Technical Standards The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies. This proposed rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards. Environment We have analyzed this proposed rule under Commandant Instruction M16475.lD and Department of Homeland Security Management Directive 5100.1, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA)(42 U.S.C. 4321-4370f), and have made a preliminary determination that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, we believe that this rule should be categorically excluded, under figure 2-1, paragraph (34)(g) of the Instruction, from further environmental documentation. This proposed rule establishes a regulated navigation area and as such is covered by this paragraph. A preliminary “Environmental Analysis Check List” is available in the docket where indicated under ADDRESSES . Comments on this section will be considered before we make the final decision on whether this rule should be categorically excluded from further environmental review. List of Subjects in 33 CFR Part 165 Harbors, Marine safety, Navigation (water), Reporting and record keeping requirements, Security measures, Waterways. For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 165 as follows: PART 165—REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS 1. The authority citation for part 165 continues to read as follows: Authority: 33 U.S.C. 1226, 1231; 46 U.S.C. Chapter 701; 50 U.S.C. 191, 195; 33 CFR 1.05-1(g), 6.04-1, 6.04-6, and 160.5; Pub. L. 107-295, 116 Stat. 2064; Department of Homeland Security Delegation No. 0170.1. 2. Add § 165.T09-013 to read as follows: § 165.T09-013 Safety Zone, Kenosha Harbor, Kenosha, WI.
(a)*Location.* The following area is a temporary safety zone: all waters of Lake Michigan 2,300 yards north of Kenosha Breakwater Light (Lightlist number 20430) and from the shoreline to 1,500 yards east Kenosha Breakwater Light (Lightlist number 20430) and bounded by a line with of point origin at 42°36′29″ N, 087°47′17″ W; then west to 42°36′29″ N, 087°49′07″ W; then south along the shoreline to 42°35′19″ N, 087°48′41″ W; then east, northeast to 42°35′24″ N, 087°47′17″ W; then north to the point of origin (NAD 83).
(b)*Effective period.* This regulation is effective from 8 a.m. (local) on June 19, 2007 to 6 p.m. (local) on June 20, 2007.
(c)*Enforcement period.* This regulation will be enforced from 8 a.m. (local) to 6 p.m. (local) on June 19, 2007 and from 8 a.m. (local) to 6 p.m. (local) on June 20, 2007.
(d)*Regulations.*
(1)In accordance with the general regulations in section 165.23 of this part, entry into, transiting, or anchoring within this safety zone is prohibited unless authorized by the Captain of the Port Lake Michigan, or his designated on-scene representative.
(2)This safety zone is closed to all vessel traffic, except as may be permitted by the Captain of the Port Lake Michigan or his designated on-scene representative.
(3)The “on-scene representative” of the Captain of the Port is any Coast Guard commissioned, warrant or petty officer who has been designated by the Captain of the Port to act on his behalf. The on-scene representative of the Captain of the Port will be aboard either a Coast Guard or Coast Guard Auxiliary vessel. The Captain of the Port or his designated on-scene representative may be contacted via VHF Channel 16.
(4)Vessel operators desiring to enter or operate within the safety zone shall contact the Captain of the Port Lake Michigan or his on-scene representative to obtain permission to do so. Vessel operators given permission to enter or operate in the safety zone must comply with all directions given to them by the Captain of the Port Lake Michigan or his on-scene representative. Dated: April 3, 2007. Bruce C. Jones, Captain, U.S. Coast Guard, Captain of the Port Lake Michigan. [FR Doc. E7-7628 Filed 4-20-07; 8:45 am] BILLING CODE 4910-15-P DEPARTMENT OF DEFENSE GENERAL SERVICES ADMINISTRATION NATIONAL AERONAUTICS AND SPACE ADMINISTRATION 48 CFR Parts 2, 3, and 52 [FAR Case 2006-007; Docket 2007-0001; Sequence 1; FAR Case 2006-007, Contractor Code of Ethics and Business Conduct] RIN 9000-AK67 Federal Acquisition Regulation; FAR Case 2006-0007, Contractor Code of Ethics and Business Conduct; Reopening of Comment Period AGENCIES: Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA). ACTION: Proposed rule; Reopening of comment period. SUMMARY: The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (Councils) are proposing to amend the Federal Acquisition Regulation
(FAR)to address Contractor Code of Ethics and Business Conduct and the display of Federal agency Office of the Inspector General
(OIG)Fraud Hotline Poster. The comment period is extended an additional 30 days to provide additional time for interested parties to review the proposed FAR changes. DATES: Interested parties should submit comments in writing on or before May 23, 2007 to be considered in the formulation of a proposed rule. ADDRESSES: Submit comments identified by FAR case 2006-007 by any of the following methods: • Federal eRulemaking Portal: *http://www.regulations.gov* . Search for any document by first selecting the proper document types and selecting “Federal Acquisition Regulation” as the agency of choice. At the “Keyword” prompt, type in the FAR case number (for example, FAR Case 2006-007) and click on the “Submit” button. Please include any personal and/or business information inside the document.You may also search for any document by clicking on the “Advanced search/document search” tab at the top of the screen, selecting from the agency field “Federal Acquisition Regulation”, and typing the FAR case number in the keyword field. Select the “Submit” button. • Fax: 202-501-4067. • Mail: General Services Administration, Regulatory Secretariat (VIR), 1800 F Street, NW., Room 4035, ATTN: Laurieann Duarte, Washington, DC 20405. *Instructions* : Please submit comments only and cite FAR case 2006-007 in all correspondence related to this case. All comments received will be posted without change to *http://www.regulations.gov* , including any personal and/or business confidential information provided. FOR FURTHER INFORMATION CONTACT: Mr. Ernest Woodson, Procurement Analyst, at
(202)501-3775 for clarification of content. For information pertaining to status or publication schedules, contact the FAR Secretariat at
(202)501-4755. Please cite FAR case 2006-007. SUPPLEMENTARY INFORMATION: The Councils published a proposed rule in the **Federal Register** at 72 FR 7588, February 16, 2007. To allow additional time for interested parties to review the proposed FAR changes, the comment period is extended for an additional 30-days. Dated: April 17, 2007 Al Matera, Acting Director,Acquisition Policy Division. [FR Doc. 07-1985 Filed 4-20-07; 8:45 am]
Connectionstraces to 28
Traces to 28 documents
CFR
- What does this subpart prohibit?§ 792.40
- Change in official or senior executive officer in credit unions that are newly chartered or are in troubled condition.§ 701.14
- May I address the unsafe condition in a way other than that set out in the airworthiness directive?§ 39.19
- Applicability.§ 71.1
- Rules and regulations.§ 601.601
- Delegation of rulemaking authority.§ 1.05-1
U.S. Code
- Public information; agency rules, opinions, orders, records, and proceedings§ 552
- Public information collection activities; submission to Director; approval and delegation§ 3507
- Definitions§ 3502
- Definitions§ 1752
- National Quality Council§ 3717
- Congressional findings and declaration of purpose§ 1601
- Equal rights under the law§ 1981
- Powers of Board§ 1766
- Federal Aviation Administration§ 106
- Purposes§ 3501
- Rules and regulations§ 7805
- Avoidance of duplicative or unnecessary analyses§ 605
- Establishment, functions, and activities§ 272
- Transferred§ 1226
- Transferred§ 191
register
26 references not yet in our index
- 6 CFR 37
- 12 CFR 701
- 12 CFR 552.11
- 12 CFR 708
- 12 CFR 716
- 12 CFR 716(r)
- 12 CFR 716(q)
- 430 F.2d 1093
- Pub. L. 105-277
- 42 USC 4311-4312
- 12 CFR 563.22(d)(1)(vi)(C)
- 12 CFR 703
- 14 CFR 39
- 14 CFR 121
- 14 CFR 71
- 26 CFR 20
- 279 U.S. 151
- 34 F.2d 233
- 280 U.S. 603
- 33 CFR 165
- 5 USC 601-612
- Pub. L. 104-121
- 44 USC 3501-3520
- 2 USC 1531-1538
- 42 USC 4321-4370f
- Pub. L. 107-295
Citation graph
cites case law
Notices
Notice of public meeting; request for comments
F. App'x430 F.2d 1093
SCOTUS279 U.S. 151
F. App'x34 F.2d 233
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