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Code · REGISTER · 2007-04-30 · PROPOSED RULES · AID Agency for International Development PROPOSED RULES Semi-annual agenda, 23133-23137 07-1421 Agricultural Agricultural Marketing Service PROPOSED RULES Onions (sweet) grown in Washington and Oregon · Unknown

Unknown. Final rule; request for comments

51,748 words·~235 min read·/register/2007/04/30/07-2104·

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

--- schema: federal-register doc_type: fedreg source_file: FR-2007-04-30.xml --- 72 82 Monday, April 30, 2007 Contents AID Agency for International Development PROPOSED RULES Semi-annual agenda, 23133-23137 07-1421 Agricultural Agricultural Marketing Service PROPOSED RULES Onions (sweet) grown in Washington and Oregon, 21125 07-2111 Agriculture Agriculture Department See Agricultural Marketing Service See Forest Service See Rural Housing Service PROPOSED RULES Semi-annual agenda, 22243-22338 07-1241 NOTICES Agency information collection activities; proposals, submissions, and approvals, E7-8153 21202-21203 E7-8154 Air Force Air Force Department NOTICES Agency information collection activities; proposals, submissions, and approvals, 21247-21248 07-2092 Antitrust Antitrust Division NOTICES Competitive impact statements and proposed consent judgments:
Amsted Industries, Inc., 21286-21298 07-2087 Architectural Architectural and Transportation Barriers Compliance Board PROPOSED RULES Semi-annual agenda, 23139-23141 07-1265 Arts Arts and Humanities, National Foundation See National Foundation on the Arts and the Humanities Blind Blind or Severely Disabled, Committee for Purchase From People Who Are See Committee for Purchase From People Who Are Blind or Severely Disabled Centers Centers for Disease Control and Prevention NOTICES Meetings:
Antimicrobial resistance; Antimicrobial Resistance Interagency Task Force annual report, 21265 E7-8158 Disease, Disability, and Injury Prevention and Control Special Emphasis Panels; correction, 21265-21266 E7-8248 Children Children and Families Administration NOTICES Agency information collection activities; proposals, submissions, and approvals, 21266 07-2090 Civil Civil Rights Commission PROPOSED RULES Semi-annual agenda, 23143-23144 07-1266 Commerce Commerce Department See Economic Development Administration See Foreign-Trade Zones Board See International Trade Administration See National Oceanic and Atmospheric Administration PROPOSED RULES Semi-annual agenda, 22339-22429 07-1425 Committee for Purchase Committee for Purchase From People Who Are Blind or Severely Disabled PROPOSED RULES Semi-annual agenda, 23145-23148 07-1250 Commodity Commodity Futures Trading Commission PROPOSED RULES Semi-annual agenda, 23441-23446 07-1270 Consumer Consumer Product Safety Commission PROPOSED RULES Semi-annual agenda, 23447-23457 07-1253 Corporation Corporation for National and Community Service PROPOSED RULES Semi-annual agenda, 23149-23151 07-1245 Court Court Services and Offender Supervision Agency for the District of Columbia PROPOSED RULES Semi-annual agenda, 23153-23154 07-1420 Defense Defense Department See Air Force Department See Navy Department PROPOSED RULES Federal Acquisition Regulation (FAR):
Semi-annual agenda, 23429-23440 07-1239 Semi-annual agenda, 22431-22466 07-1240 NOTICES Agency information collection activities; proposals, submissions, and approvals, 21227-21228 07-2091 Arms sales notification; transmittal letter, etc., 21228-21246 07-2094 07-2095 07-2097 07-2098 Meetings: Uniform Formulary Beneficiary Advisory Panel, 21246-21247 07-2096 Meetings; Sunshine Act, 21247 07-2113 Drug Drug Enforcement Administration NOTICES *Applications, hearings, determinations, etc.:* Noramco Inc., 21298 E7-8132 Organichem Corp., 21298 E7-8131 Stepan Co., 21298-21299 E7-8133 Economic Economic Development Administration NOTICES Adjustment assistance; applications, determinations, etc.:
Romarc Corp. et al., 21216-21217 07-2100 Education Education Department PROPOSED RULES Semi-annual agenda, 22467-22472 07-1243 NOTICES Agency information collection activities; proposals, submissions, and approvals, 21249 E7-8203 Grants and cooperative agreements; availability, etc.: Special education and rehabilitative services— Technology and Media Services for Individuals with Disabilities Program, 21249-21254 E7-8185 Meetings: Safe and Drug-Free Schools and Communities Advisory Committee, 21254 E7-8145 Employee Employee Benefits Security Administration NOTICES Employee benefit plans; individual exemptions:
Kern County Electrical Pension Trust et al., 21299-21301 E7-8183 Victor P. Olson Profit sharing Plan et al., 21302-21307 E7-8184 Employment Employment and Training Administration NOTICES Grants and cooperative agreements; availability, etc.: Workforce Investment Act incentive awards, 21307-21310 E7-8221 Energy Energy Department See Federal Energy Regulatory Commission PROPOSED RULES Semi-annual agenda, 22473-22488 07-1641 EPA Environmental Protection Agency RULES Air quality implementation plans; approval and promulgation; various States:
Illinois, 21116-21119 E7-8104 Toxic substances: Preliminary assessment information reporting and health and safety data reporting— Voluntary High Production Challenge Program orphan chemicals, list; chemical substances withdrawn, 21119-21123 07-2104 PROPOSED RULES Air quality implementation plans; approval and promulgation; various States: Illinois, 21189-21190 E7-8102 Semi-annual agenda, 23155-23300 07-1422 Toxic substances: Polychlorinated biphenyls; manufacturing (import) exemption, 21190-21197 E7-8182 NOTICES Agency information collection activities; proposals, submissions, and approvals, 21254-21260 E7-8165 E7-8166 E7-8167 E7-8169 E7-8181 Air pollution control:
California pollution control standards— Federal preemption waiver request; public hearing, 21260-21261 E7-8168 Pesticide, food, and feed additive petitions: Keller and Heckman LLP et al., 21261-21263 E7-8180 Valent Biosciences Corp., 21263-21265 E7-8179 Equal Equal Employment Opportunity Commission PROPOSED RULES Semi-annual agenda, 23303-23306 07-1246 Executive Executive Office of the President See Management and Budget Office See Presidential Documents See Privacy and Civil Liberties Oversight Board Farm Farm Credit Administration PROPOSED RULES Semi-annual agenda, 23459-23464 07-1256 FAA Federal Aviation Administration RULES Airworthiness directives:
APEX Aircraft, 21077-21079, 21086-21087 E7-7980 E7-7994 Boeing, 21079-21086 E7-7850 E7-7853 Cessna; correction, 21320 Z7-7519 EADS SOCATA, 21090-21093 E7-8003 Empresa Braileira de Aeronauica S.A. (EMBRAER), 21088-21090 E7-7841 Vulcanair S.p.A., 21093-21095 E7-8071 PROPOSED RULES Airworthiness directives: Airbus, 21164-21166 E7-8172 Boeing, 21166-21169 E7-8175 M7 Aerospace LP, 21171-21176 E7-8163 McDonnell Douglas, 21169-21171 E7-8176 Airworthiness standards: Special conditions— Boeing Model 787-8 airplane, 21162-21164 E7-8186 NOTICES Aeronautical land-use assurance; waivers:
Deer Valley Airport, AZ, 21312-21313 07-2103 FCC Federal Communications Commission PROPOSED RULES Semi-annual agenda, 23465-23529 07-1426 NOTICES Meetings; Sunshine Act, 21265 07-2119 FDIC Federal Deposit Insurance Corporation PROPOSED RULES Semi-annual agenda, 23531-23538 07-1417 Federal Election Federal Election Commission NOTICES Meetings; Sunshine Act, 21265 07-2138 Federal Energy Federal Energy Regulatory Commission RULES Electric utilities (Federal Power Act): Business practice standards and communication protocols for public utilities, 21095-21099 E7-7892 PROPOSED RULES Semi-annual agenda, 23539-23549 07-1242 Federal Highway Federal Highway Administration NOTICES Environmental statements; notice of intent:
Utah County, UT, 21313 E7-8161 Federal Housing Federal Housing Enterprise Oversight Office PROPOSED RULES Semi-annual agenda, 23343-23346 07-1249 Federal Housing Federal Housing Finance Board PROPOSED RULES Semi-annual agenda, 23551-23554 07-1248 FMC Federal Maritime Commission PROPOSED RULES Semi-annual agenda, 23555-23557 07-1268 Federal Mediation Federal Mediation and Conciliation Service PROPOSED RULES Semi-annual agenda, 23307-23308 07-1251 Federal Motor Federal Motor Carrier Safety Administration NOTICES Motor carrier safety standards:
Driver qualifications; diabetes exemptions, 21316-21318 E7-8178 Driver qualifications; vision requirement exemptions, 21313-21316 E7-8177 Federal Reserve Federal Reserve System PROPOSED RULES Consumer leasing (Regulation M): Electronic disclosures delivery, 21135-21141 E7-7877 Electronic fund transfers (Regulation E): Electronic disclosures delivery, 21131-21135 E7-7876 Equal Credit Opportunity (Regulation B): Electronic disclosures delivery, 21125-21131 E7-7875 Semi-annual agenda, 23559-23566 07-1255 Truth in lending (Regulation Z):
Electronic disclosures delivery, 21141-21155 E7-7878 Truth in savings (Regulation DD): Electronic disclosures delivery, 21155-21162 E7-7873 FTC Federal Trade Commission PROPOSED RULES Semi-annual agenda, 23567-23580 07-1244 Fish Fish and Wildlife Service NOTICES Endangered and threatened species: Incidental take permits— Sarasota County, FL; Florida scrub-jay, 21282-21283 E7-8159 Survival enhancement permits— Texas; Attwater's prairie chicken, northern aplomado falcon, whooping crane, and black lace cactus; safe harbor agreement, 21283-21284 E7-8164 Environmental statements; availability, etc.:
Big Branch Marsh National Wildlife Refuge, LA; comprehensive conservation plan, 21284 E7-8162 Food Food and Drug Administration NOTICES Agency information collection activities; proposals, submissions, and approvals, 21266-21270 E7-8141 Meetings: Quality in clinical investigations from design to completion; defining and Implementing; workshop and comment request, 21270-21271 E7-8137 Memorandums of understanding: FDA and National Cancer Institute; proteomics technology development and application in clinical settings, 21271-21277 07-2106 MISSING FOR:
Foreign-Trade Zones Board Foreign-Trade Zones Board NOTICES *Applications, hearings, determinations, etc.:* Georgia Perkins Shibaura Engines LLC; diesel engine manufacturing facility, 21217-21218 E7-8198 Louisiana Candies Shipbuilders, L.L.C.; shipbuilding facility, 21218 E7-8201 New Mexico Louisiana Energy Services, L.P.; gas centrifuge production equipment facility, 21218-21219 E7-8205 North Carolina, 21219 E7-8206 Forest Forest Service NOTICES Environmental statements; notice of intent:
Ashley, Dixie, Fishlake, Manti-La Sal, Uinta, and Wasatch-Cache National Forests, UT, 21203-21205 E7-8149 Eldorado, Inyo, Lassen, Modoc, Plumas, Sequoia, Sierra, Stanislaus, and Tahoe National Forests and Lake Tahoe Basin, CA, 21205-21206 E7-8160 Recreation fee areas: Tanto National Forest, AZ; Haigler Canyon Recreation Site overnight camping and day-use fee, 21206-21207 07-2099 GSA General Services Administration PROPOSED RULES Federal Acquisition Regulation (FAR): Semi-annual agenda, 23429-23440 07-1239 Semi-annual agenda, 23309-23319 07-1619 Government Government Ethics Office PROPOSED RULES Semi-annual agenda, 23347-23355 07-1261 Health Health and Human Services Department See Centers for Disease Control and Prevention See Children and Families Administration See Food and Drug Administration PROPOSED RULES Semi-annual agenda, 22489-22572 07-1618 Homeland Homeland Security Department PROPOSED RULES Semi-annual agenda, 22573-22674 07-1293 Housing Housing and Urban Development Department PROPOSED RULES Semi-annual agenda, 22675-22703 07-1252 NOTICES Environmental statements; availability, etc.:
Placer County, CA; Vista Village affordable housing development, 21278-21279 E7-8138 Grant and cooperative agreement awards: Indian Community Development Block Grant Program (2006 FY), 21279-21282 E7-8140 Senior Executive Service Performance Review Board; membership, 21282 E7-8191 Indian Indian Affairs Bureau NOTICES Tribal-State Compacts approval; Class III (casino) gambling: Northern Cheyenne Tribe, MT, 21284 E7-8134 Spokane Tribe, WA, 21284-21285 E7-8136 Interior Interior Department See Fish and Wildlife Service See Indian Affairs Bureau See National Indian Gaming Commission See National Park Service See Surface Mining Reclamation and Enforcement Office PROPOSED RULES Semi-annual agenda, 22705-22772 07-1419 IRS Internal Revenue Service RULES Income taxes:
Designated Roth accounts, 21103-21116 E7-8125 International International Trade Administration NOTICES Antidumping: Fresh garlic from— China, 21219-21225 E7-8195 Justice Justice Department See Antitrust Division See Drug Enforcement Administration PROPOSED RULES Semi-annual agenda, 22773-22823 07-1427 Labor Labor Department See Employee Benefits Security Administration See Employment and Training Administration PROPOSED RULES Semi-annual agenda, 22827-22871 07-1418 NOTICES Agency information collection activities; proposals, submissions, and approvals, 21299 E7-8142 Management Management and Budget Office PROPOSED RULES Semi-annual agenda, 23357-23359 07-1424 Maritime Maritime Administration NOTICES Coastwise trade laws; administrative waivers:
RELAX A WILE, 21318 E7-8194 Meetings: Marine Transportation System National Advisory Council, 21318-21319 07-2109 NASA National Aeronautics and Space Administration PROPOSED RULES Federal Acquisition Regulation (FAR): Semi-annual agenda, 23429-23440 07-1239 Semi-annual agenda, 23321-23324 07-1238 National Archives National Archives and Records Administration PROPOSED RULES Semi-annual agenda, 23325-23330 07-1262 NOTICES Agency records schedules; availability, 21310-21312 E7-8150 National Credit National Credit Union Administration PROPOSED RULES Semi-annual agenda, 23581-23589 07-1258 National Foundation National Foundation on the Arts and the Humanities PROPOSED RULES Semi-annual agenda:
Institute of Museum and Library Services, 23331-23332 07-1640 National Endowment for the Arts, 23333-23335 07-1267 National Endowment for the Humanities, 23337-23339 07-1263 National Indian National Indian Gaming Commission PROPOSED RULES Semi-annual agenda, 23591-23596 07-1254 NOAA National Oceanic and Atmospheric Administration RULES Fishery conservation and management: Northeastern United States fisheries— Northeast multispecies, 21123-21124 07-2083 PROPOSED RULES Fishery conservation and management:
Alaska; fisheries of Exclusive Economic Zone— Bering Sea and Aleutian Islands groundfish, 21198-21201 E7-8190 Caribbean, Gulf, and South Atlantic fisheries— Gulf of Mexico Fishery Management Council; hearings, 21197 E7-8189 Northeastern U.S. fisheries— Mid-Atlantic Fishery Management Council; hearings, 21197-21198 E7-8197 NOTICES Environmental statements; notice of intent: New England Fishery Management Council; skate fishery management plan, 21225-21226 E7-8187 Meetings: Gulf of Mexico Fishery Management Council, 21226 E7-8143 New England Fishery Management Council, 21226-21227 E7-8146 Pacific Fishery Management Council, 21227 E7-8144 National Park National Park Service NOTICES Environmental statements; availability, etc.:
Castillo de San Marcos National Monument, FL; general management plan, 21285 E7-8151 National Register of Historic Places; pending nominations, 21285-21286 E7-8124 National Science National Science Foundation PROPOSED RULES Semi-annual agenda, 23341-23342 07-1596 Navy Navy Department NOTICES Environmental statements; notice of intent: Navy Cherry Point Range Complex, NC; Atlantic Fleet training operations; public scoping meetings, 21248-21249 E7-8188 Nuclear Nuclear Regulatory Commission PROPOSED RULES Semi-annual agenda, 23597-23614 07-1257 Office Office of Management and Budget See Management and Budget Office Peace Peace Corps PROPOSED RULES Semi-annual agenda, 23383-23386 07-1415 Pension Pension Benefit Guaranty Corporation PROPOSED RULES Semi-annual agenda, 23387-23392 07-1294 Personnel Personnel Management Office PROPOSED RULES Semi-annual agenda, 23361-23381 07-1247 Pipeline Pipeline and Hazardous Materials Safety Administration NOTICES Agency information collection activities; proposals, submissions, and approvals, 21319 E7-8232 Presidential Presidential Documents PROCLAMATIONS *Special observances:* Malaria Awareness Day (Proc. 8132), 21075-21076 07-2136 Privacy Privacy and Civil Liberties Oversight Board PROPOSED RULES Semi-annual agenda, 23393-23394 07-1595 Railroad Railroad Retirement Board RULES Railroad Retirement Act:
Disability earnings determinations, 21099-21103 E7-8155 PROPOSED RULES Semi-annual agenda, 23395-23397 07-1260 Regulatory Regulatory Information Service Center PROPOSED RULES Introduction to Unified Agenda of Regulatory and Deregulatory Actions, 22235-22242 07-1632 Rural Rural Housing Service NOTICES Grants and cooperative agreements; availability, etc.: Rural Rental Housing Program for New Construction (2007 FY), 21207-21211 E7-8157 Section 515 Muti-family Housing Preservation and Revitalization Restructuring Program, 21211-21216 E7-8148 SEC Securities and Exchange Commission PROPOSED RULES Semi-annual agenda, 23615-23640 07-1297 Selective Selective Service System PROPOSED RULES Semi-annual agenda, 23399-23400 07-1269 SBA Small Business Administration PROPOSED RULES Semi-annual agenda, 23401-23411 07-1295 Social Social Security Administration PROPOSED RULES Semi-annual agenda, 23413-23428 07-1296 State State Department PROPOSED RULES Semi-annual agenda, 22873-22881 07-1292 Surface Surface Mining Reclamation and Enforcement Office PROPOSED RULES Permanent program and abandoned mine land reclamation plan submissions:
Ohio, 21176-21185 E7-8171 Texas, 21185-21189 E7-8156 Surface Surface Transportation Board PROPOSED RULES Semi-annual agenda, 23641-23645 07-1264 Transportation Transportation Department See Federal Aviation Administration See Federal Highway Administration See Federal Motor Carrier Safety Administration See Maritime Administration See Pipeline and Hazardous Materials Safety Administration See Surface Transportation Board PROPOSED RULES Semi-annual agenda, 22883-22973 07-1597 NOTICES Aviation proceedings:
Agreements filed; weekly receipts, 21312 E7-8173 Certificates of public convenience and necessity and foreign air carrier permits; weekly applications, 21312 E7-8174 Treasury Treasury Department See Internal Revenue Service PROPOSED RULES Semi-annual agenda, 22975-23110 07-1416 NOTICES Meetings: Debt Management Advisory Committee; correction, 21320 C7-1826 Veterans Veterans Affairs Department PROPOSED RULES Semi-annual agenda, 23111-23131 07-1259 Separate Parts in This Issue Part II-LX The Unified Agenda of the Federal Regulatory and Deregulatory Actions, 22233-23759 07-1632 07-1264 Reader Aids Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws.
To subscribe to the Federal Register Table of Contents LISTSERV electronic mailing list, go to http://listserv.access.gpo.gov and select Online mailing list archives, FEDREGTOC-L, Join or leave the list (or change settings); then follow the instructions. 72 82 Monday, April 30, 2007 Rules and Regulations DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-27529; Directorate Identifier 2007-CE-018-AD; Amendment 39-15038; AD 2007-09-06] RIN 2120-AA64 Airworthiness Directives;
APEX Aircraft (Type Certificate No. A36EU Formerly Held by AVIONS MUDRY et CIE) Model CAP 10 B Airplanes AGENCY: Federal Aviation Administration (FAA), DOT. ACTION: Final rule; request for comments. SUMMARY: We are adopting a new airworthiness directive
(AD)for the products listed above. This AD results from mandatory continuing airworthiness information
(MCAI)issued by the aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as Several recent inspections have revealed that some spar wooden centre blocks have shown cracks. Investigation revealed that cracks are generated by the wood drying. Actions specified in this AD are intended to detect and correct any defects on the central wing spar block. This AD requires actions that are intended to address the unsafe condition described in the MCAI. DATES: This AD becomes effective May 21, 2007. On May 21, 2007 the Director of the Federal Register approved the incorporation by reference of certain publications listed in this AD. We must receive any comments on this AD by June 4, 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 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: Mr. Sarjapur Nagarajan, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4145; 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. The 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 AD references the MCAI and related service information that we considered in forming the engineering basis to correct the unsafe condition. The AD contains text copied from the MCAI and for this reason might not follow our plain language principles. Discussion The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued AD No. 2007-0015, dated January 12, 2007 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states: Several recent inspections have revealed that some spar wooden centre blocks have shown cracks. Investigation revealed that cracks are generated by the wood drying. Actions specified in this AD are intended to detect and correct any defects on the central wing spar block. This AD is requiring the installation of two reinforcement plates on the wing spar to counter the shear loading, implementation of corrective actions to slow down the wood drying and is also introducing new repetitive inspections. You may obtain further information by examining the MCAI in the AD docket. Relevant Service Information APEX Aircraft has issued Service Bulletin No. 060307 R1, Amendment date November 2, 2006; Apex Aircraft CAP10C—Main Spar Wooden Center Block—Reinforcement Instructions No. 1001766, dated October 6, 2006; and Apex Aircraft Document No. 1001133-A, DR400 Spar Consolidation, Applying Araldite 2015 Adhesive, dated February 4, 2003. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI. FAA's Determination and Requirements of This 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 issuing this AD because we evaluated all information provided by the State of Design Authority and determined the unsafe condition exists and is likely to exist or develop on other products of the same type design. Differences Between This 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 have also required different actions in this AD from those in the MCAI in order to follow FAA policies. Any such differences are described in a separate paragraph of the AD. These requirements take precedence over those copied from the MCAI. FAA's Determination of the Effective Date An unsafe condition exists that requires the immediate adoption of this AD. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule because of cracks found on the central wing spar block. Therefore, we determined that notice and opportunity for public comment before issuing this AD are impracticable and that good cause exists for making this amendment effective in fewer than 30 days. Comments Invited This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2007-27529; Directorate Identifier 2007-CE-018-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this 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 AD. 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 AD will not have federalism implications under Executive Order 13132. This AD will 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 this AD:
(1)Is not a “significant regulatory action” under Executive Order 12866;
(2)Is not a “significant rule” under 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 AD and placed it in the AD docket. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety. Adoption of the Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA amends14 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: **2007-09-06 APEX Aircraft (Type Certificate No. A36EU formerly held by AVIONS MUDRY et CIE):** Amendment 39-15038; Docket No. FAA-2007-27529; Directorate Identifier 2007-CE-018-AD. Effective Date
(a)This airworthiness directive
(AD)becomes effective May 21, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to Model CAP 10 B airplanes, all serial numbers, that are:
(1)Certificated in any category; and
(2)fitted with major change 000302, wood/carbon-made wings, part-number 11.56.00.010, serial numbers 001 to 084 inclusive. Subject
(d)Air Transport Association of America
(ATA)Code 57: Wings. Reason
(e)The mandatory continuing airworthiness information
(MCAI)states: Several recent inspections have revealed that some spar wooden center blocks have shown cracks. Investigation revealed that cracks are generated by the wood drying. Actions specified in this AD are intended to detect and correct any defects on the central wing spar block. This AD is requiring the installation of two reinforcement plates on the wing spar to counter the shear loading, implementation of corrective actions to slow down the wood drying and is also introducing new repetitive inspections. Actions and Compliance
(f)Unless already done, do the following actions:
(1)Before further flight after May 21, 2007 (the effective date of this AD):
(i)Fabricate a placard that incorporates the following words (using at least 1/8 -inch letters) and install this placard on the instrument panel within the pilot's clear view: “FLICK MANEUVERS ARE PROHIBITED”; and
(ii)Insert a copy of this AD into the Limitations section of the Pilot's Operating Handbook (POH).
(iii)The owner/operator holding at least a private pilot certificate as authorized by section 43.7 of the Federal Aviation Regulations (14 CFR 43.7) may fabricate the placard required in paragraph (f)(1)(i) of this AD and may insert the information into the POH as required in paragraph (f)(1)(ii) of this AD. Make an entry into the aircraft records showing compliance with these portions of the AD in accordance with section 43.9 of the Federal Aviation Regulations (14 CFR 43.9).
(2)Within the next 50 hours time-in-service
(TIS)after May 21, 2007 (the effective date of this AD), inspect the front and rear spar webs for cracks and damage using Apex Aircraft Service Bulletin No. 060307 R1, Amendment date November 2, 2006.
(3)If any crack or damage is found during the inspection required in paragraph (f)(2) of this AD, the wing must be considered as unairworthy until the implementation of the relevant repair solution. Before further flight, contact Apex Aircraft to obtain a repair solution and incorporate the repair. Continued operation with cracks in the front and rear spar webs is prohibited.
(4)If no cracks or damages are found in either the rear or the front wing spar web during the inspection required in paragraph (f)(2) of this AD, before further flight install reinforcement plates, part number 97.56.00.002, using Apex Aircraft CAP10C—Main Spar Wooden Center Block—Reinforcement Instructions No. 1001766-A, dated June 10, 2006; and Apex Aircraft Document No. 1001133-A, DR400 Spar Consolidation, Applying Araldite 2015 Adhesive, dated February 4, 2003.
(5)After doing the actions required in paragraphs (f)(2), (f)(3), and (f)(4) of this AD:
(i)Flick maneuvers previously prohibited by paragraph (f)(1) of this AD are now permitted. Before further flight, remove the placard required in paragraph (f)(1)(i) of this AD and remove the insertion into the POH required in paragraph (f)(1)(ii) of this AD.
(ii)Repetitively inspect the front and rear spar webs for cracks and damage thereafter at intervals not to exceed 13 months using Apex Aircraft Service Bulletin No. 060307 R1, Amendment date November 2, 2006; and
(iii)If any crack or damage is found during any inspection required by paragraph (f)(5)(ii) this AD, before further flight contact Apex Aircraft to obtain a repair solution and incorporate the repair.
(6)After 50 hours TIS after May 21, 2007 (the effective date of this AD), do not install an Apex Aircraft wood/carbon-made wing, part number 11.56.00.010, unless it has been inspected and is found to be crack free and modified using Apex Aircraft Service Bulletin No. 060307 R1, Amendment date November 2, 2006; and Apex Aircraft CAP10C—Main Spar Wooden Center Block—Reinforcement Instructions No. 1001766-A, dated October 6, 2006. FAA AD Differences Note: This AD differs from the MCAI and/or service information as follows: The MCAI allows continued flight if cracks are found in the wing spar webs that do not exceed certain limits. The applicable service bulletin specifies replacing the wing spar webs only if cracks are found exceeding limits specified in Apex Aircraft Service Bulletin No. 060307 R1, Amendment date November 2, 2006, as does the MCAI. This AD does not allow continued flight if any crack is found. FAA policy is to disallow airplane operation when known cracks exist in primary structure, unless the ability to sustain ultimate load with these cracks is proven. The wing spar webs are considered primary structure, and the FAA has not received any analysis to prove that ultimate load can be sustained with cracks in these areas. Other FAA AD Provisions
(g)The following provisions also apply to this AD:
(1)Alternative Methods of Compliance (AMOCs): The Manager, Standards Staff, FAA, Small Airplane Directorate, ATTN: Sarjapur Nagarajan, Aerospace Engineer, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4145; 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)AD No. 2007-0015, dated January 12, 2007; Apex Aircraft Service Bulletin No. 060307 R1, Amendment dated November 2, 2006; Apex Aircraft CAP10C—Main Spar Wooden Center Block—Reinforcement Instructions No. 1001766, dated October 6, 2006; and Apex Aircraft Document No. 1001133-A, DR400 Spar Consolidation, Applying Araldite 2015 Adhesive, dated February 4, 2003, for related information. Material Incorporated by Reference
(i)You must use Apex Aircraft Service Bulletin No. 060307 R1, Amendment date November 2, 2006; Apex Aircraft CAP10C—Main Spar Wooden Center Block—Reinforcement Instructions No. 1001766-A, dated October 6, 2006; and Apex Aircraft Document No. 1001133-A, DR400 Spar Consolidation, Applying Araldite 2015 Adhesive, dated February 4, 2003, to do the actions required by this AD, unless the AD specifies otherwise.
(1)The Director of the Federal Register approved the incorporation by reference of this service information under 5 U.S.C. 552(a) and 1 CFR part 51.
(2)For service information identified in this AD, contact Apex Aircraft, Bureau de Navigabilit, 1 route de Troyes, 21121 DAROIS—France, telephone:
(33)380 35 65 10; fax:
(33)380 35 65 15; e-mail: *apex-aircraft.com* .
(3)You may review copies at the FAA, Central Region, Office of the Regional Counsel, 901 Locust, Room 506, Kansas City, Missouri 64106; or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to: *http://www.archives.gov/federal-register/cfr/ibr-locations.html* . Issued in Kansas City, Missouri on April 20, 2007. Charles L. Smalley, Acting Manager, Small Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-7980 Filed 4-27-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2006-23842; Directorate Identifier 2005-NM-145-AD; Amendment 39-15034; AD 2007-09-04] RIN 2120-AA64 Airworthiness Directives; Boeing Model 777-200, 777-300, and 777-300ER Series Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Final rule. SUMMARY: The FAA is adopting a new airworthiness directive
(AD)for certain Boeing Model 777-200, 777-300, and 777-300ER series airplanes. This AD requires repetitive inspections for discrepancies of the splined components that support the inboard end of the inboard trailing edge flap; related investigative, corrective, and other specified actions if necessary; a one-time modification of the inboard support of the inboard trailing edge flap by installing a new isolation strap and attachment hardware; and repetitive replacement of the torque tube assembly. For certain Boeing Model 777-200 series airplanes, this AD also specifies prior or concurrent accomplishment of one-time inspections of the flap seal panels for cracking and minimum clearances, and of the torque tubes for damage; and related investigative and corrective actions if necessary. This AD also provides a terminating action (modification of the inboard main flap) for the repetitive inspections. This AD results from reports of corrosion on the torque tube and closeout rib fittings that support the inboard end of the inboard trailing edge flap, as well as a structural reassessment of the torque tube joint that revealed the potential for premature fatigue cracking of the torque tube that would not be detected using reasonable inspection methods. We are issuing this AD to detect and correct corrosion or cracking of the torque tube and closeout rib fittings that support the inboard end of the inboard trailing edge flap. Cracking in these components could lead to a fracture, which could result in loss of the inboard trailing edge flap and consequent reduced controllability of the airplane. DATES: This AD becomes effective June 4, 2007. The Director of the Federal Register approved the incorporation by reference of certain publications listed in the AD as of June 4, 2007. ADDRESSES: You may examine the AD docket on the Internet at *http://dms.dot.gov* or in person at the Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC. Contact Boeing Commercial Airplanes, P.O. Box 3707, Seattle, Washington 98124-2207, for service information identified in this AD. FOR FURTHER INFORMATION CONTACT: Gary Oltman, Aerospace Engineer, Airframe Branch, ANM-120S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue, SW., Renton, Washington 98057-3356; telephone
(425)917-6443; fax
(425)917-6590. SUPPLEMENTARY INFORMATION: Examining the Docket You may examine the AD docket on the Internet at *http://dms.dot.gov* or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone
(800)647-5227) is located on the plaza level of the Nassif Building at the street address stated in the ADDRESSES section. Discussion The FAA issued a supplemental notice of proposed rulemaking
(NPRM)to amend 14 CFR part 39 to include an AD that would apply to certain Boeing Model 777-200 and 777-300 series airplanes. That supplemental NPRM was published in the **Federal Register** on October 3, 2006 (71 FR 58314). That supplemental NPRM proposed to require repetitive inspections for discrepancies of the splined components that support the inboard end of the inboard trailing edge flap; related investigative, corrective, and other specified actions if necessary; a one-time modification of the inboard support of the inboard trailing edge flap by installing a new isolation strap and attachment hardware; and repetitive replacement of the torque tube assembly. That supplemental NPRM also specified prior or concurrent accomplishment, for certain Boeing Model 777-200 series airplanes, of one-time inspections of the flap seal panels for cracking and minimum clearances, and of the torque tubes for damage; and related investigative and corrective actions if necessary. That supplemental NPRM also provided a terminating action (modifying the inboard main flap) for the repetitive inspections. Comments We provided the public the opportunity to participate in the development of this AD. We have considered the comments received. Support for the Supplemental NPRM Boeing, Continental Airlines, and United Airlines concur with the contents of the supplemental NPRM. Request To Clarify Inspection Threshold United Airlines would like to know if the inspection threshold limits specified in paragraph (l)(2) of the supplemental NPRM should be applied from the airplane manufacture date or after the accomplishment of the torque tube assembly replacement done in accordance with paragraph (l)(1). The compliance times in the proposed rule are accomplished in accordance with the service bulletin, which requires the inspections to be accomplished at the times and intervals noted in the Boeing 777 Maintenance Planning Document (MPD). The MPD has inspection thresholds based on the time in service rather than the torque tube assembly replacement done in accordance with paragraph (l)(1) of the supplemental NPRM. We agree that this threshold for inspection needs clarification. Therefore, we have added a clarification in the AD to permit the use of a threshold measured from the actions done in accordance with paragraph (l)(1) of this AD, rather than delivery of the airplane, as specified in paragraph (l)(2) of the AD. However, the conservative method of measuring the threshold from delivery of the airplane may still be used. Request To Clarify Inspection Requirement Continental Airlines states that the supplemental NPRM seems to indicate that the initial inspection in paragraph
(h)must be accomplished for the splined components before the modification done in accordance with Boeing Service Bulletin 777-57-0054, dated February 23, 2006, can be performed. Continental does not believe it is necessary to perform the initial inspection when the splined component will be replaced with new or improved parts per the modification. Continental believes that the AD should have a provision to allow upfront modification of the splined components without doing the inspections in accordance with Boeing Service Bulletin 777-57A0048, Revision 1, dated June 9, 2005. We agree that it is not necessary in this circumstance to do the initial inspection. Replacing certain parts with new or improved parts in accordance with Boeing Service Bulletin 777-57-0054 terminates the inspections specified in Boeing Service Bulletin 777-57A0048, Revision 1. Therefore, we have clarified paragraphs
(h)and (l)(1) of the AD to help avoid potential confusion and unnecessary inspection. Requests Regarding Service Information The Modification and Replacement Parts Association (MARPA) requests that service documents essential to the accomplishment of the supplemental NPRM be
(1)incorporated by reference into the regulatory document, and
(2)published in the docket management system (DMS). We infer that MARPA would like to have documents incorporated by reference during the NPRM phase of rulemaking. We do not agree that documents should be incorporated by reference during the NPRM phase of rulemaking. The Office of the Federal Register
(OFR)requires that documents that are necessary to accomplish the requirements of the AD be incorporated by reference during the final rule phase of rulemaking. This final rule incorporates by reference the document necessary for the accomplishment of the actions required by this AD. Further, we point out that while documents that are incorporated by reference do become public information, they do not lose their copyright protection. For that reason, we advise the public to contact the manufacturer to obtain copies of the referenced service information. In regard to the commenter's request to post service bulletins on the Department of Transportation's DMS, we are currently in the process of reviewing issues surrounding the posting of service bulletins on DMS as part of an AD docket. Once we have thoroughly examined all aspects of this issue and have made a final determination, we will consider whether our current practice needs to be revised. No change to the final rule is necessary in response to this comment. Request To Reference Defective Parts Manufacturer Approval
(PMA)Parts The same commenter also requests that the supplemental NPRM be modified to consider the possibility of defective PMA parts and permit the use of PMA parts that meet the “new and improved” criteria pursuant to existing laws and regulations and the issues set forth in the current proposed regulatory action. We recognize the need for standardization of this issue and we are currently in the process of reviewing issues that address the use of PMAs in ADs at the national level. However, the Transport Airplane Directorate considers that to delay this particular AD action would be inappropriate, since we have determined that an unsafe condition exists and that replacement of certain parts must be accomplished to ensure continued safety. Therefore, no change has been made to the AD in this regard. Conclusion We have carefully reviewed the available data, including the comments received, and determined that air safety and the public interest require adopting the AD with the changes described previously. We have determined that these changes will neither increase the economic burden on any operator nor increase the scope of the AD. Costs of Compliance There are about 353 airplanes of the affected design in the worldwide fleet. The following table provides the estimated costs for U.S. operators to comply with this AD, at an average labor rate of $80 per work hour. Estimated Costs Action Work hours Parts Cost per airplane Number of U.S.- registered airplanes Fleet cost Detailed inspection for discrepancies of the splined components 20 None $1,600, per inspection cycle 132 $211,200, per inspection cycle. Modification (installing isolation strap and hardware) Negligible $17,156 $17,156 132 $2,264,592. Replacement of torque tube assembly Negligible 1 24,230 $24,230 132 $3,198,360, per replacement cycle. Modification (terminating action) 32 to 36, depending on airplane configuration 145,659 $148,219 to 148,539 132 $19,564,908 to 19,607,148. Prior or concurrent inspection 1 None $80 Up to 132 As much as $10,560. 1 Provided that the replacement is performed at the same time as a scheduled inspection. 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 AD will not have federalism implications under Executive Order 13132. This AD will 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 this AD:
(1)Is not a “significant regulatory action” under Executive Order 12866;
(2)Is not a “significant rule” under 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 AD and placed it in the AD docket. See the ADDRESSES section for a location to examine the regulatory evaluation. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety. Adoption of the Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA amends 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The Federal Aviation Administration
(FAA)amends § 39.13 by adding the following new airworthiness directive (AD): **2007-09-04 Boeing:** Amendment 39-15034. Docket No. FAA-2006-23842; Directorate Identifier 2005-NM-145-AD. Effective Date
(a)This AD becomes effective June 4, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to Boeing Model 777-200, -300, and -300ER series airplanes, certificated in any category; as identified in Boeing Service Bulletin 777-57-0054, dated February 23, 2006. Unsafe Condition
(d)This AD results from reports of corrosion on the torque tube and closeout rib fittings that support the inboard end of the inboard trailing edge flap, as well as a structural reassessment of the torque tube joint that revealed the potential for premature fatigue cracking of the torque tube that would not be detected using reasonable inspection methods. We are issuing this AD to detect and correct corrosion or cracking of the torque tube and closeout rib fittings that support the inboard end of the inboard trailing edge flap. Cracking in these components could lead to a fracture, which could result in loss of the inboard trailing edge flap and consequent reduced controllability of the airplane. Compliance
(e)You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done. Service Bulletin Reference
(f)The term “service bulletin,” as used in paragraphs (g), (h), (i), (j), and
(k)of this AD, means Boeing Service Bulletin 777-57A0048, Revision 1, dated June 9, 2005.
(g)Where the service bulletin specifies a compliance time after the issuance of the service bulletin, this AD requires compliance within the specified compliance time after the effective date of this AD. Initial Inspection
(h)For all airplanes: Do a detailed inspection for any discrepancy of the splined components of the inboard trailing edge flap, in accordance with the Accomplishment Instructions of the service bulletin. The splined components of the inboard trailing edge flap include the torque tube, closeout rib fitting assembly, carrier beam pillow block fitting assembly, and drive crank support. Discrepancies of the torque tube and closeout rib fitting include light contact wear, corrosion pits, corrosion, cracking, or fracture. Discrepancies of the carrier beam pillow block fitting assembly and drive crank support consist of light contact wear and damage to the cadmium plating. Do the initial inspection at the applicable time specified in Table 7 under paragraph 1.E., “Compliance,” of the service bulletin, except as provided by paragraph
(g)of this AD. Doing the modification in paragraph (l)(1) of this AD terminates the inspection requirements of this paragraph. Note 1: For the purposes of this AD, a detailed inspection is: “An intensive examination of a specific item, installation, or assembly to detect damage, failure, or irregularity. Available lighting is normally supplemented with a direct source of good lighting at an intensity deemed appropriate. Inspection aids such as mirror, magnifying lenses, etc., may be necessary. Surface cleaning and elaborate procedures may be required.” No Discrepancy/Other Specified Actions
(i)If no discrepancy is found during the inspection required by paragraph
(h)of this AD, perform all applicable specified actions, including the modification to install a new isolation strap and attachment hardware, in accordance with the Accomplishment Instructions of the service bulletin. Then, repeat the inspection at the applicable time specified in Table 7 under paragraph 1.E., “Compliance,” of the service bulletin. Doing the modification in paragraph (l)(1) of this AD terminates the repetitive inspection requirements of this paragraph. Related Investigative/Corrective/Other Specified Actions and Repetitive Inspections
(j)For any discrepancy found during any inspection required by paragraphs
(h)and
(i)of this AD: Before further flight, accomplish all applicable related investigative, corrective, and other specified actions, including the modification to install a new isolation strap and attachment hardware, in accordance with the Accomplishment Instructions of the service bulletin. Then, evaluate the spline rework to determine the appropriate repetitive interval, in accordance with the Accomplishment Instructions of the service bulletin. Thereafter, repeat the inspection at the applicable interval specified in Table 7 under paragraph 1.E., “Compliance,” of the service bulletin. Doing the modification in paragraph (l)(1) of this AD terminates the repetitive inspection requirements of this paragraph. Replacement of Torque Tube Assembly
(k)For all airplanes: Replace the torque tube assembly with a new torque tube assembly, in accordance with the Accomplishment Instructions of the service bulletin. Do the initial replacement at the applicable compliance time specified in Notes
(c)and (d), as applicable, of Table 7 in paragraph 1.E., “Compliance,” of the service bulletin, except as provided by paragraph
(g)of this AD. Repeat the replacement thereafter at the applicable interval specified in Notes
(c)and (d), of Table 7 under paragraph 1.E., “Compliance,” of the service bulletin. Doing the modification in paragraph (l)(1) of this AD terminates the repetitive replacement requirements of this paragraph. Modification
(l)For all airplanes: Within 60 months after the effective date of this AD, do the actions in paragraphs (l)(1) and (l)(2) of this AD.
(1)Modify the inboard main flap in accordance with the Accomplishment Instructions of Boeing Service Bulletin 777-57-0054, dated February 23, 2006. Doing this modification terminates the repetitive requirements of paragraphs (i), (j), and (k), of this AD; and inspection requirements of the splined components of the torque tube and the closeout rib fitting assemblies, as required by paragraph
(h)of this AD.
(2)Revise the FAA-approved maintenance inspection program for performing periodic inspections and maintenance of the torque tube splined joints in accordance with the Accomplishment Instructions of Boeing Service Bulletin 777-57-0054, dated February 23, 2006. For the purpose of the inspections required by this paragraph, the inspection threshold may be measured from the installation of the modification required by paragraph (l)(1) of this AD. Concurrent Requirement
(m)For Boeing Model 777-200 series airplanes, as identified in Boeing Service Bulletin 777-27-0034, Revision 1, dated April 20, 2006: Prior to or concurrently with the actions in paragraph
(l)of this AD, do a general visual inspection of the flap seal panels for cracking and minimum clearances, and a detailed inspection of the torque tubes for damage; and do all applicable related investigative and corrective actions before further flight. Do all actions in accordance with the Accomplishment Instructions of Boeing Service Bulletin 777-27-0034, Revision 1, dated April 20, 2006; except where the service bulletin specifies the corrective action of replacing the torque tube, the replacement must be done in accordance with the Accomplishment Instructions of Boeing Service Bulletin 777-57-0054, dated February 23, 2006. Note 2: For the purposes of this AD, a general visual inspection is: “A visual examination of an interior or exterior area, installation, or assembly to detect obvious damage, failure, or irregularity. This level of inspection is made from within touching distance unless otherwise specified. A mirror may be necessary to ensure visual access to all surfaces in the inspection area. This level of inspection is made under normally available lighting conditions such as daylight, hangar lighting, flashlight, or droplight and may require removal or opening of access panels or doors. Stands, ladders, or platforms may be required to gain proximity to the area being checked.” Actions Done in Accordance With Previous Issues of Service Bulletins
(n)Actions done before the effective date of this AD in accordance with Boeing Service Bulletin 777-27-0034, dated February 11, 1999; or Boeing Alert Service Bulletin 777-57A0048, dated September 9, 2004; are acceptable for compliance with the corresponding actions of this AD. Alternative Methods of Compliance (AMOCs) (o)(1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested in accordance with the procedures found in 14 CFR 39.19.
(2)Before using any AMOC approved in accordance with § 39.19 on any airplane to which the AMOC applies, notify the appropriate principal inspector in the FAA Flight Standards Certificate Holding District Office.
(3)An AMOC that provides an acceptable level of safety may be used for any repair required by this AD, if it is approved by an Authorized Representative for the Boeing Commercial Airplanes Delegation Option Authorization Organization who has been authorized by the Manager, Seattle ACO, to make those findings. For a repair method to be approved, the repair must meet the certification basis of the airplane. Material Incorporated by Reference
(p)You must use the service information specified in Table 1 of this AD to perform the actions that are required by this AD, unless the AD specifies otherwise. The Director of the Federal Register approved the incorporation by reference of these documents in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. Contact Boeing Commercial Airplanes, P.O. Box 3707, Seattle, Washington 98124-2207, for a copy of this service information. You may review copies at the FAA, Transport Airplane Directorate, 1601 Lind Avenue, SW., Renton, Washington; or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to: *http://www.archives.gov/federal-register/cfr/ibr-locations.html* . Table 1.—Material Incorporated by Reference Boeing Service Bulletin Revision level Date 777-27-0034 1 April 20, 2006. 777-57-0054 Original February 23, 2006. 777-57A-0048 1 June 9, 2005. Issued in Renton, Washington, on April 17, 2007. Ali Bahrami, Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-7853 Filed 4-27-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-27558; Directorate Identifier 2007-NM-053-AD; Amendment 39-15036; AD 2007-06-52] RIN 2120-AA64 Airworthiness Directives; Boeing Model 737-800 Series Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Final rule; request for comments. SUMMARY: This document publishes in the **Federal Register** an amendment adopting airworthiness directive
(AD)2007-06-52 that was sent previously to all known U.S. owners and operators of Boeing Model 737-800 series airplanes by individual notices. This AD requires inspecting spoilers to determine spoiler position after every landing and after any rejected takeoff maneuvers. For airplanes on which any spoiler is found in the up position with the speedbrake handle in the down position, this AD requires replacement of the flight spoiler actuator with a flight spoiler actuator having a certain part number. This AD also requires an operational test of the speedbrake control system after any maintenance actions that operate the spoiler system and replacement of the flight spoiler actuator if necessary. This AD also provides for optional terminating action for those requirements. In addition, this AD requires you to report to the manufacturer any spoiler panel that is found in the up position with the speedbrake handle in the down position. This AD results from a report of seven flight spoiler actuator jams on Model 737-800 Short Field Performance airplanes. We are issuing this AD to detect and correct any spoiler panel that is found in the up position with the speedbrake handle in the down position, which could result in a spoiler actuator hardover, and could cause the spoiler surface to jam in the fully extended position. Two or more hardover failures of the spoiler surfaces in the up direction on the same wing, if undetected prior to takeoff, can cause significant roll and consequent loss of control of the airplane. DATES: This AD becomes effective May 7, 2007 to all persons except those persons to whom it was made immediately effective by emergency AD 2007-06-52, issued March 14, 2007, which contained the requirements of this amendment. The incorporation by reference of a certain publication listed in the AD is approved by the Director of the Federal Register as of May 7, 2007. We must receive comments on this AD by June 29, 2007. ADDRESSES: Use one of the following addresses to submit comments on this AD. • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Government-wide rulemaking Web site:* Go to *http://www.regulations.gov* and follow the instructions for sending your comments electronically. • *Mail:* Docket Management Facility; U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC 20590. • *Fax:*
(202)493-2251. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. Contact Boeing Commercial Airplanes, P.O. Box 3707, Seattle, Washington 98124-2207, for service information identified in this AD. FOR FURTHER INFORMATION CONTACT: Kelly McGuckin, Aerospace Engineer, Systems and Equipment Branch, ANM-130S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue, SW., Renton, Washington 98057-3356; telephone
(425)917-6490; fax
(425)917-6590. SUPPLEMENTARY INFORMATION: On March 14, 2007, we issued emergency AD 2007-06-52, which applies to certain Boeing Model 737-800 series airplanes. Background On March 13, 2007, the FAA issued emergency AD 2007-06-51 for certain Boeing Model 737-800 series airplanes. That AD requires inspecting spoilers to determine spoiler position after every landing and after any rejected takeoff maneuvers. For airplanes on which any spoiler is found in the up position with the speedbrake handle in the down position, that AD requires replacement of the flight spoiler actuator with a flight spoiler actuator having a certain part number. That AD also requires an operational test of the speedbrake control system after any maintenance actions that operate the spoiler system and replacement of the flight spoiler actuator if necessary. That AD also provides for optional terminating action for those requirements. In addition, that AD requires you to report to the manufacturer any spoiler panel that is found in the up position with the speedbrake handle in the down position. That AD resulted from a report of seven flight spoiler actuator jams on Model 737-800 Short Field Performance
(SFP)airplanes. Two reports involved in-service airplanes that were discovered during a routine maintenance walk-around and were believed to have occurred on the previous landing during auto speedbrake extension. Five other reports occurred during spoiler system testing at Boeing prior to delivery. An additional two reports of spoiler actuator input lever binding were identified during bench testing after Boeing began to investigate this issue. The two in-service failures of flight spoilers resulted in the spoilers not retracting after the speedbrake handle was moved to the DOWN position after landing, on a Boeing Model 737-800 airplane equipped with an SFP package. In both of these cases, the spoiler was discovered in the full-extended position during a routine maintenance walk-around. The spoiler remained in the full-extended position after cycling of the speedbrake handle. Further investigation revealed that the spoiler actuator failure is most likely to occur when the speedbrakes are deployed on the ground (automatically or manually) for either a rejected takeoff or normal landing. The takeoff configuration warning will not sound if any flight spoiler remains extended with the speedbrake handle in the DOWN position. The cause of the failure has been identified as interference within the actuator main control valve. This condition, if not corrected, could result in a spoiler actuator hardover, which could cause the spoiler surface to jam in the fully extended position. Two or more hardover failures of the spoiler surfaces in the up direction on the same wing, if undetected prior to takeoff, can cause significant roll and consequent loss of control of the airplane. Actions Since Issuance of Previous AD Since that AD was issued, we have become aware of two incorrect part numbers identified throughout emergency AD 2007-06-51. The identified incorrect part numbers do not exist. The incorrect part numbers were for the replacement flight spoiler actuator and the flight spoiler actuator that may no longer be installed. In light of this, we have determined that emergency AD 2007-06-51 must be superseded to reflect the correct part numbers. Relevant Service Information We have reviewed Boeing 737 Flight Crew Operations Manual Bulletin No. TBC-67, dated March 5, 2007. The bulletin describes procedures for inspecting spoilers to determine spoiler position after landing and after any rejected takeoff maneuvers. For airplanes on which any spoiler is found in the up position with the speedbrake handle in the down position, the bulletin specifies to contact maintenance. FAA's Determination and Requirements of This AD Since the unsafe condition described is likely to exist or develop on other airplanes of the same type design, we issued emergency AD 2007-06-52 to detect and correct any spoiler panel that is found in the up position with the speedbrake handle in the down position, which could result in a spoiler actuator hardover, and could cause the spoiler surface to jam in the fully extended position. Two or more hardover failures of the spoiler surfaces in the up direction on the same wing, if undetected prior to takeoff, can cause significant roll and consequent loss of control of the airplane. This new AD supersedes emergency AD 2007-06-51. This new AD requires the actions specified in emergency AD 2007-06051, but corrects certain part numbers. This AD requires accomplishing the actions specified in the service information described previously, except as described in “Differences Between This AD and the Service Information.” We found that immediate corrective action was required; therefore, notice and opportunity for prior public comment thereon were impracticable and contrary to the public interest, and good cause existed to make the AD effective immediately by individual notices issued on March 14, 2007, to all known U.S. owners and operators of Boeing Model 737-800 series airplanes. These conditions still exist, and the AD is hereby published in the **Federal Register** as an amendment to section 39.13 of the Federal Aviation Regulations (14 CFR 39.13) to make it effective to all persons. Differences Between This AD and the Service Information In addition to the inspection specified in the service information, this AD also requires that, after any maintenance action that operates the spoiler system, the “Speedbrake Control System Operational Test” specified in Chapter 27-62-00 of the Boeing 737-600/700/800/900 Aircraft Maintenance Manual
(AMM)be accomplished. This AD also specifies that the Master Minimum Equipment List Item 27-7, “Auto Speed Brake System,” is no longer applicable to Model 737-800 series airplanes equipped with an SFP package. This AD also provides an optional terminating action of installing flight spoiler actuator, part number (P/N) P665A0001-01 or higher dash number, in all eight flight spoiler positions. Although the service information specifies that operators may contact maintenance for disposition if any spoiler remains in the up position with the speedbrake handle in the down position, this AD requires operators to replace the flight spoiler actuator with a flight spoiler actuator, having P/N P665A0001-01 or higher dash number, using a method approved by the FAA. Operators should note that the service information specifies doing an inspection. However, this AD requires doing a “visual check,” which may be done by qualified ground personnel or flightcrew. We have determined that these visual checks may be properly performed by flightcrew because the checks do not require tools, precision measuring equipment, training, or pilot logbook endorsements, or the use of or reference to technical data that are not contained in the body of the AD. Interim Action We consider this AD interim action. We are currently considering requiring the replacement of the flight spoiler actuator, which will constitute terminating action for the visual checks and operational tests required by this AD action. Comments Invited This AD is a final rule that involves requirements that affect flight safety and was not preceded by notice and an opportunity for public comment; however, we invite you to submit any relevant written data, views, or arguments regarding this AD. Send your comments to an address listed in the ADDRESSES section. Include “Docket No. FAA-2007-27558; Directorate Identifier 2007-NM-053-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the AD that might suggest a need to modify it. 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 AD. Using the search function of that Web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You may review the DOT's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477-78), or you may visit *http://dms.dot.gov* . Examining the Docket You may examine the AD docket on the Internet at *http://dms.dot.gov* , or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone
(800)647-5227) is located on the plaza level of the Nassif Building at the DOT street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after the Docket Management System receives them. 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 AD will not have federalism implications under Executive Order 13132. This AD will 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. The FAA has determined that this regulation is an emergency regulation that must be issued immediately to correct an unsafe condition in aircraft, and that it is not a “significant regulatory action” under Executive Order 12866. It has been determined further that this action involves an emergency regulation under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979). If this emergency regulation is later deemed significant under DOT Regulatory Policies and Procedures, we will prepare a final regulatory evaluation and place it in the AD Docket. See the ADDRESSES section for a location to examine the regulatory evaluation, if filed. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety. Adoption of the Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA amends 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 (AD): **2007-06-52 Boeing:** Amendment 39-15036. Docket No. FAA-2007-27558; Directorate Identifier 2007-NM-053-AD. Effective Date
(a)This AD becomes effective May 7, 2007, to all persons except those persons to whom it was made immediately effective by emergency AD 2007-06-52, issued on March 14, 2007, which contained the requirements of this amendment. Affected ADs
(b)This AD supersedes emergency AD 2007-06-51, issued March 13, 2007. Applicability
(c)This AD applies to the Boeing Model 737-800 series airplanes, certificated in any category, serial numbers 32685, 34277 through 34281 inclusive, 34474, 34475, 34654 through 34656 inclusive, 34690, 34948, 34949, 35091 through 35093 inclusive, 35103, 35134, 35176 through 35183 inclusive, 35330, 35331, 35558, 35559, and 36323 through 36328 inclusive. Unsafe Condition
(d)This AD results from a report of seven flight spoiler actuator jams on Model 737-800 Short Field Performance
(SFP)airplanes. The cause of the failure has been identified as interference within the actuator main control valve. We are issuing this AD to detect and correct any spoiler panel that is found in the up position with the speedbrake handle in the down position, which could result in a spoiler actuator hardover, and could cause the spoiler surface to jam in the fully extended position. Two or more hardover failures of the spoiler surfaces in the up direction on the same wing, if undetected prior to takeoff, can cause significant roll and consequent loss of control of the airplane. Compliance
(e)You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done. Visual Check and Corrective Action
(f)Within 24 clock hours after the effective date of this AD, do the actions specified in paragraphs (f)(1), (f)(2), and (f)(3) of this AD, as applicable. The visual checks required by paragraphs (f)(1) and (f)(2) of this AD may be performed by qualified personnel or flightcrew, and must be entered into the aircraft records showing compliance with this AD in accordance with 14 CFR 43.9(b) and 14 CFR 121.363 and 121.380.
(1)After every landing, visually check the spoilers to determine spoiler position, in accordance with Boeing 737 Flight Crew Operations Manual Bulletin No. TBC-67, dated March 5, 2007.
(i)If all spoilers are determined to be properly stowed, no further action is required by this paragraph.
(ii)If any spoiler is found to be improperly stowed (in the up position with the speedbrake handle in the down position), before further flight, replace the flight spoiler actuator with a flight spoiler actuator, having part number (P/N) P665A0001-01 or higher dash number, in accordance with a method approved by the Manager, Seattle Aircraft Certification Office (ACO), FAA. The “Flight Spoiler Actuator Removal” task and the “Flight Spoiler Actuator Installation” task in Chapter 27-61-51 of the Boeing 737-600/700/800/900 Aircraft Maintenance Manual
(AMM)are approved methods for the replacement (removal and installation) of the flight spoiler actuator.
(2)After any rejected takeoff maneuver, do the visual check specified in paragraph (f)(1) of this AD.
(3)After any maintenance action that operates the spoiler system, do an operational test of the speedbrake control system in accordance with a method approved by the Manager, Seattle ACO, FAA. The “Speedbrake Control System Operational Test” specified in Chapter 27-62-00 of the Boeing 737-600/700/800/900 AMM is one approved method for the operational test of the speedbrake control system. If any spoiler panel is found to be fully extended with the speedbrake handle down, or if any spoiler panel is found fully retracted when the speedbrake handle is up, before further flight, replace the flight spoiler actuator in accordance with the actions specified in paragraph (f)(1)(ii) of this AD. Master Minimum Equipment List Item
(g)As of the effective date of this AD, the Master Minimum Equipment List Item 27-7, “Auto Speed Brake System,” is no longer applicable to Model 737-800 series airplanes equipped with an SFP package. Optional Terminating Action
(h)Installation of flight spoiler actuator, P/N P665A0001-01 or higher dash number, in all eight flight spoiler positions ends the requirements of paragraph
(f)of this AD. Reporting
(i)If any spoiler is found to be improperly stowed during any visual check required by this AD, at the applicable time specified in paragraphs (i)(1) and (i)(2) of this AD, report the following information electronically to Boeing using the established Boeing Communications System (BCS): Airplane serial number, jam position, spoiler panel number or wing position of the spoiler that jammed, date of visual check, and flight hours accumulated on the airplane.
(1)For visual checks done before the effective date of this AD: Within 7 days after the effective date of this AD.
(2)For visual checks done after the effective date of this AD: Within 7 days after doing the inspection. Parts Installation
(j)As of the effective date of this AD, no person may install a flight spoiler actuator, having P/N P665A0001-00, on any airplane. Special Flight Permit
(k)Special flight permits, as described in Section 21.197 and Section 21.199 of the Federal Aviation Regulations (14 CFR 21.197 and 21.199), are not allowed. Alternative Methods of Compliance (AMOCs) (l)(1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested in accordance with the procedures found in 14 CFR 39.19.
(2)To request a different method of compliance or a different compliance time for this AD, follow the procedures 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. Material Incorporated by Reference
(m)You must use Boeing 737 Flight Crew Operations Manual Bulletin No. TBC-67, dated March 5, 2007, to perform the actions that are required by this AD, unless the AD specifies otherwise. The Director of the **Federal Register** approved the incorporation by reference of this document in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. Contact Boeing Commercial Airplanes, P.O. Box 3707, Seattle, Washington 98124-2207, for a copy of this service information. You may review copies at the FAA, Transport Airplane Directorate, 1601 Lind Avenue, SW., Renton, Washington; or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to: *http://www.archives.gov/federal-register/cfr/ibr-locations.html* . Issued in Renton, Washington, on April 18, 2007. Ali Bahrami, Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-7850 Filed 4-27-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-27342 Directorate Identifier 2007-CE-014-AD; Amendment 39-15037; AD 2007-09-05] RIN 2120-AA64 Airworthiness Directives; APEX Aircraft Model CAP 10 B Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Final rule. SUMMARY: We are adopting a new airworthiness directive
(AD)for the products listed above. This AD results from mandatory continuing airworthiness information
(MCAI)issued 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: A CAP10B aircraft experienced a reduced elevator deflection by about 13° due to an incorrect routing of the Push To Talk
(PTT)wire bundle and improperly secured connectors which impeded the complete and free movement of the control stick. We are issuing this AD to require actions to correct the unsafe condition on these products. DATES: This AD becomes effective June 4, 2007. On June 4, 2007 the Director of the Federal Register approved the incorporation by reference of certain publications listed in this AD. ADDRESSES: You may examine the AD docket on the Internet at *http://dms.dot.gov* or in person at the Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC. FOR FURTHER INFORMATION CONTACT: Sarjapur Nagarajan, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4145; 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. The 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 decisionmaking responsibilities to identify and correct unsafe conditions on U.S.-certificated products. This AD references the MCAI and related service information that we considered in forming the engineering basis to correct the unsafe condition. The AD contains text copied from the MCAI and for this reason might not follow our plain language principles. Discussion We issued a notice of proposed rulemaking
(NPRM)to amend 14 CFR part 39 to include an AD that would apply to the specified products. That NPRM was published in the **Federal Register** on March 9, 2007 (72 FR 10624). That NPRM proposed to correct an unsafe condition for the specified products. The MCAI states: A CAP10B aircraft experienced a reduced elevator deflection by about 13° due to an incorrect routing of the Push To Talk
(PTT)wire bundle and improperly secured connectors which impeded the complete and free movement of the control stick. Actions specified in this AD are intended to inspect, detect and correct any discrepancy on the PTT electrical circuit connectors and wires that could lead to a reduction of the control stick movements. Comments We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM or on the determination of the cost to the public. Conclusion We reviewed the available data and determined that air safety and the public interest require adopting the AD as proposed. Differences Between This 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 required 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 AD. Costs of Compliance We estimate that this AD will affect 31 products of U.S. registry. We also estimate that it will take about 1 work-hour per product to comply with basic requirements of this AD. The average labor rate is $80 per work-hour. Based on these figures, we estimate the cost of this AD to the U.S. operators to be $2,480 or $80 per product. In addition, we estimate that any necessary follow-on actions would take about 3 work-hours and require parts costing $90, for a cost of $330 per product. We have no way of determining the number of products that may need these actions. 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 AD will not have federalism implications under Executive Order 13132. This AD will 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 AD:
(1)Is not a “significant regulatory action” under Executive Order 12866;
(2)Is not a “significant rule” under 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 AD and placed it in the AD Docket. 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 the NPRM, 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. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety. Adoption of the Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA amends 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: **2007-09-05 APEX Aircraft (Type Certificate No. A36EU formerly held by AVIONS MUDRY et CIE):** Amendment 39-15037; Docket No. FAA-2007-27342; Directorate Identifier 2007-CE-014-AD. Effective Date
(a)This airworthiness directive
(AD)becomes effective June 4, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to Model CAP 10 B airplanes, serial numbers 001 through 282, fitted with major change 000302 (wood-carbon wings), that are certificated in any category. Subject
(d)Air Transport Association of America
(ATA)Code 27: Flight Controls. Reason
(e)The mandatory continuing airworthiness information
(MCAI)states: A CAP10B aircraft experienced a reduced elevator deflection by about 13° due to an incorrect routing of the Push To Talk
(PTT)wire bundle and improperly secured connectors which impeded the complete and free movement of the control stick. Actions specified in this AD are intended to inspect, detect and correct any discrepancy on the PTT electrical circuit connectors and wires that could lead to a reduction of the control stick movements. Actions and Compliance
(f)Unless already done, do the following actions:
(1)Within the next 50 hours time-in-service after June 4, 2007 (the effective date of this AD), inspect the wire routing for the proper location and attachment of the connectors as detailed in the accomplishment instructions of APEX Aircraft Mandatory Service Bulletin No. 050605, dated October 17, 2006.
(2)Before further flight, if a defect or discrepancy is found during the inspection in paragraph (f)(1) of this AD, modify the wire bundle and connectors routing as detailed in the accomplishment instructions of APEX Aircraft Mandatory Service Bulletin No. 050605, dated October 17, 2006. 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: Sarjapur Nagarajan, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4145; 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 AD No: 2007-0014, dated January 12, 2007; and APEX Aircraft Mandatory Service Bulletin No. 050605, dated October 17, 2006, for related information. Material Incorporated by Reference
(i)You must use APEX Aircraft Mandatory Service Bulletin No. 050605, dated October 17, 2006, to do the actions required by this AD, unless the AD specifies otherwise.
(1)The Director of the Federal Register approved the incorporation by reference of this service information under 5 U.S.C. 552(a) and 1 CFR part 51.
(2)For service information identified in this AD, contact Apex Aircraft, Bureau de Navigabilité, 1, route de Troyes, 21121 DAROIS—France; telephone: +33 380 35 65 10; fax +33 380 35 65 15; e-mail: *airworthiness@apex-aircraft.com;* Internet: *http://www.apex-aircraft.com.*
(3)You may review copies at the FAA, Central Region, Office of the Regional Counsel, 901 Locust, Room 506, Kansas City, Missouri 64106; or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to: *http://www.archives.gov/federal-register/cfr/ibr-locations.html.* Issued in Kansas City, Missouri, on April 19, 2007. Charles L. Smalley, Acting Manager, Small Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-7994 Filed 4-27-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-27616; Directorate Identifier 2007-NM-052-AD; Amendment 39-15035; AD 2007-06-53] RIN 2120-AA64 Airworthiness Directives; Empresa Brasileira de Aeronautica S.A. (EMBRAER) Model ERJ 170 and ERJ 190 Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Final rule; request for comments. SUMMARY: This document publishes in the **Federal Register** an amendment adopting airworthiness directive
(AD)2007-06-53 that was sent previously to all known U.S. owners and operators of EMBRAER Model ERJ 170 and ERJ 190 airplanes by individual notices. This AD requires repetitively verifying the correct closure of the forward and aft cargo doors, inspecting the forward and aft cargo doors for interference between the lock handle and the aft edge liner assembly, repetitively inspecting the lateral roller fittings on the forward and aft cargo door frames for damage, and doing corrective actions if needed. This AD also requires reporting any signs of interference or damage to the manufacturer. This AD results from a report indicating that the aft cargo door opened in flight just after departure, and from a report indicating that an airplane was dispatched with an unsecured forward cargo door. We are issuing this AD to prevent a cargo door from opening during flight, which could lead to structural failure or loss of control. DATES: This AD becomes effective May 7, 2007 to all persons except those persons to whom it was made immediately effective by emergency AD 2007-06-53, issued March 19, 2007, which contained the requirements of this amendment. The incorporation by reference of certain publications listed in the AD is approved by the Director of the **Federal Register** as of May 7, 2007. We must receive comments on this AD by June 29, 2007. ADDRESSES: Use one of the following addresses to submit comments on this AD. • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Government-wide rulemaking Web site:* Go to *http://www.regulations.gov* and follow the instructions for sending your comments electronically. • *Mail:* Docket Management Facility; U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC 20590. • *Fax:*
(202)493-2251. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. For service information identified in this AD, contact Empresa Brasileira de Aeronautica S.A. (EMBRAER), P.O. Box 343—CEP 12.225, Sao Jose dos Campos—SP, Brazil. FOR FURTHER INFORMATION CONTACT: Tom Groves, Aerospace Engineer, International Branch, ANM-116, FAA, Transport Airplane Directorate, 1601 Lind Avenue, SW., Renton, Washington 98057-3356; telephone
(425)227-1503; fax
(425)227-1149. SUPPLEMENTARY INFORMATION: On March 19, 2007, we issued emergency AD 2007-06-53, which applies to all EMBRAER Model ERJ 170 and ERJ 190 airplanes. Background The FAA received a report that the aft cargo door of a Model ERJ 190 airplane opened in flight just after takeoff. The airplane returned to the departure airport and landed without incident. We advised the Agência Nacional de Aviação Civil (ANAC), which is the airworthiness authority for Brazil, of the report and worked closely with the ANAC to assess the safety implications of the report. The assessment of the event indicated that the door was not fully closed when the airplane took off. Inspection of the airplane revealed that the door frame lateral roller fitting was cracked and the roller fitting cover plate was distorted. The roller fitting cover plate distortion caused a malfunction in the door position indication system. A similar situation was found on the forward cargo door on a Model ERJ 170 airplane. In that instance, the problem was discovered by ground personnel, and the door was secured prior to takeoff. The cargo door design is the same for the Model ERJ 190 and ERJ 170 airplanes. Therefore, an unsafe condition may exist on all EMBRAER Model ERJ 170 and ERJ 190 airplanes. We are issuing this AD to prevent a cargo door from opening during flight, which could lead to structural failure or loss of control. Relevant Service Information EMBRAER has issued Alert Service Bulletins 170-52-A036 (for Model ERJ 170 airplanes) and 190-52-A018 (for Model ERJ 190 airplanes), both dated March 12, 2007. The alert service bulletins describe the following procedures: • Removal of the roller fitting cover plate; • A one-time visual inspection of the forward and aft cargo doors to detect signs of interference between the lock handle and the aft edge liner assembly; • Rework of the aft edge liner assembly, which must be done immediately if there are signs of interference, and may be deferred for a specified time if there are no signs of interference; • A one-time visual inspection of the forward and aft cargo doors to detect signs of damage of the lateral roller fitting; and • Immediate replacement of any damaged fitting with one having the same part number. The ANAC mandated the actions in the alert service bulletins and issued Brazilian airworthiness directives 2007-03-01 and 2007-03-02, both effective March 16, 2007, to ensure the continued airworthiness of these airplanes in Brazil. The alert service bulletins refer to EMBRAER Service Bulletins 170-50-0006 and 190-50-0006 as additional sources of service information for removing the roller fitting cover plate and reworking the aft edge liner assembly. These service bulletins are currently at Revision 01, dated March 13, 2007. FAA's Determination and Requirements of This AD These airplane models are manufactured in Brazil and are type certificated for operation in the United States under the provisions of section 21.29 of the Federal Aviation Regulations (14 CFR 21.29) and the applicable bilateral airworthiness agreement. Pursuant to this bilateral airworthiness agreement, the ANAC has kept the FAA informed of the situation described above. We have examined the ANAC's findings, evaluated all pertinent information, and determined that we need to issue an AD for products of this type design that are certificated for operation in the United States. Since the unsafe condition described is likely to exist or develop on other airplanes of the same type design, we issued emergency AD 2007-06-53 to prevent a cargo door from opening during flight; the door could detach from and strike the airplane and result in structural damage and possible loss of control of the airplane. The AD requires accomplishing the actions specified in the service information previously described. This AD also requires repetitively verifying, before each flight, the correct closure of the forward and aft cargo doors, and reporting positive inspection results to EMBRAER. We found that immediate corrective action was required; therefore, notice and opportunity for prior public comment thereon were impracticable and contrary to the public interest, and good cause existed to make the AD effective immediately by individual notices issued on March 19, 2007, to all known U.S. owners and operators of EMBRAER Model ERJ 170 and ERJ 190 airplanes. These conditions still exist, and the AD is hereby published in the **Federal Register** as an amendment to section 39.13 of the Federal Aviation Regulations (14 CFR 39.13) to make it effective to all persons. Clarification of Qualifications for Performing Preflight Verifications This AD permits the preflight verifications to be done by mechanics and flightcrew members. We have determined that this provision will accommodate operators' maintenance scheduling demands and yet ensure an acceptable level of safety. Explanation of Reporting Requirement This AD also requires that operators report the results of positive inspection findings to EMBRAER. The required inspection reports will help determine the extent in the fleet of potentially contributing conditions. Based on the results of these reports, we might determine that further corrective action is warranted. Interim Action We consider this AD interim action. The manufacturer is currently developing a modification to the door position sensing system that will further address the unsafe condition identified in this AD. Once this modification is developed, approved, and available, we might consider additional rulemaking. Comments Invited This AD is a final rule that involves requirements that affect flight safety and was not preceded by notice and an opportunity for public comment; however, we invite you to submit any relevant written data, views, or arguments regarding this AD. Send your comments to an address listed in the ADDRESSES section. Include “Docket No. FAA-2007-27616; Directorate Docket No. 2007-NM-052-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the AD that might suggest a need to modify it. 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 AD. Using the search function of that Web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You may review the DOT's complete Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477-78), or you may visit *http://dms.dot.gov* . Examining the Docket You may examine the AD docket on the Internet at *http://dms.dot.gov* , or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Management Facility office (telephone
(800)647-5227) is located on the plaza level of the Nassif Building at the DOT street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after the Docket Management System receives them. 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 AD will not have federalism implications under Executive Order 13132. This AD will 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. The FAA has determined that this regulation is an emergency regulation that must be issued immediately to correct an unsafe condition in aircraft, and that it is not a “significant regulatory action” under Executive Order 12866. It has been determined further that this action involves an emergency regulation under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979). If this emergency regulation is later deemed significant under DOT Regulatory Policies and Procedures, we will prepare a final regulatory evaluation and place it in the AD Docket. See the ADDRESSES section for a location to examine the regulatory evaluation, if filed. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety. Adoption of the Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA amends 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 (AD): **2007-06-53 Empresa Brasileira de Aeronautica S.A. (EMBRAER):** Amendment 39-15035. Docket No. FAA-2007-27616; Directorate Identifier 2007-NM-052-AD. Effective Date
(a)This AD becomes effective May 7, 2007, to all persons except those persons to whom it was made immediately effective by emergency AD 2007-06-53, issued on March 19, 2007, which contained the requirements of this amendment. Affected ADs
(b)None. Applicability
(c)This AD applies to all EMBRAER Model ERJ 170-100 LR, -100 STD, -100 SE, -100 SU, -200 LR, -200 STD, and -200 SU airplanes; and ERJ 190-100 STD, -100 LR, and -100 IGW airplanes; certificated in any category. Unsafe Condition
(d)This AD results from a report indicating that the aft cargo door of a Model ERJ 190 airplane opened in flight just after departure, and from a report indicating that a Model ERJ 170 airplane dispatched with an unsecured forward cargo door. The Federal Aviation Administration is issuing this AD to prevent a cargo door from opening during flight, which could lead to structural failure or loss of control. Compliance
(e)You are responsible for having the actions required by this AD performed within the compliance times specified, unless the actions have already been done. Preflight Verifications of Correct Door Closure
(f)As of 24 hours after the effective date of this AD: Before each flight after closing the cargo doors, verify that the forward and aft cargo doors are closed flush with the fuselage skin, and that all 4 latched and locked indicators at the bottom of each door are green. Persons qualified to do this verification are mechanics and flightcrew members. If it cannot be verified that both doors are closed flush with the fuselage skin, and that all 4 latched and locked indicators at the bottom of each door are green, repair before further flight. Repeat the verification before every flight until accomplishment of the actions required by paragraph
(g)of this AD. Inspection for Interference and Damage
(g)Within 10 days after the effective date of this AD, do the actions specified in paragraphs (g)(1), (g)(2), and (g)(3) of this AD, in accordance with the Accomplishment Instructions of EMBRAER Alert Service Bulletin 170-52-A036 (for Model ERJ 170 airplanes) or 190-52-A018 (for Model ERJ 190 airplanes), both dated March 12, 2007, as applicable.
(1)Remove the roller fitting cover plate on the forward and aft cargo door frames.
(2)Perform a detailed inspection of the forward and aft cargo doors to detect signs of interference between the lock handle and the aft edge liner assembly. Then rework the aft edge liner assembly at the applicable time specified in paragraph (g)(2)(i) or (g)(2)(ii) of this AD.
(i)If any sign of interference is detected: Rework the assembly before further flight.
(ii)If no sign of interference is detected: Rework the assembly within 150 flight cycles after the inspection.
(3)Perform a detailed inspection for signs of damage of the lateral roller fitting on the forward and aft cargo door frames at the fuselage. If any damage is found, replace the lateral roller fitting before further flight with a new roller fitting having the same part number, in accordance with the applicable service bulletin. Note 1: For the purposes of this AD, a detailed inspection is: “An intensive examination of a specific item, installation, or assembly to detect damage, failure, or irregularity. Available lighting is normally supplemented with a direct source of good lighting at an intensity deemed appropriate. Inspection aids such as mirror, magnifying lenses, etc., may be necessary. Surface cleaning and elaborate procedures may be required.” Note 2: EMBRAER Alert Service Bulletins 170-52-A036 and 190-52-A018 refer to EMBRAER Service Bulletins 170-50-0006 and 190-50-0006, respectively, as additional sources of service information for the rework and roller fitting cover plate removal. Service Bulletins 170-50-0006 and 190-50-0006 are currently at Revision 01, dated March 13, 2007. Repetitive Inspection for Damage
(h)Repeat the inspection specified in paragraph (g)(3) of this AD at intervals not to exceed 150 flight cycles. Report
(i)At the applicable time specified in paragraph (i)(1) or (i)(2) of this AD: Send EMBRAER a report of any signs of interference or damage found during each inspection required by paragraphs (g)(2), (g)(3), and
(h)of this AD. The report must include the inspection results, a description of any discrepancies found, the airplane serial number, and the number of landings and flight hours on the airplane. Send the report to EMBRAER, EFTC, AOG Structure Team; *structure@embraer.com.br* ; fax +55 12 3927 6600, extension 0484. 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 contained in this AD and has assigned OMB Control Number 2120-0056.
(1)For any inspection done after the effective date of this AD: Within 10 days after the inspection.
(2)For any inspection done before the effective date of this AD: Within 10 days after the effective date of this AD. Parts Installation
(j)As of the effective date of this AD: No person may install a roller fitting cover plate on the forward and aft cargo door frames on any airplane. Alternative Methods of Compliance (AMOCs) (k)(1) The Manager, International Branch, ANM-116, Transport Airplane Directorate, FAA, has the authority to approve AMOCs for this AD, if requested in accordance with the procedures found in 14 CFR 39.19.
(2)To request a different method of compliance or a different compliance time for this AD, follow the procedures 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. Related Information
(l)Brazilian airworthiness directives 2007-03-01 and 2007-03-02, both effective March 16, 2007, also address the subject of this AD. Material Incorporated by Reference
(m)You must use EMBRAER Alert Service Bulletin 170-52-A036, dated March 12, 2007; or EMBRAER Alert Service Bulletin 190-52-A018, dated March 12, 2007; as applicable, to perform the actions that are required by this AD, unless the AD specifies otherwise. The Director of the Federal Register approves the incorporation by reference of these documents in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. To get copies of the service information, contact Empresa Brasileira de Aeronautica S.A. (EMBRAER), P.O. Box 343—CEP 12.225, Sao Jose dos Campos—SP, Brazil. You may review copies at the FAA, Transport Airplane Directorate, 1601 Lind Avenue, SW., Renton, Washington; or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to: *http://www.archives.gov/federal-register/cfr/ibr-locations.html* . Issued in Renton, Washington, on April 17, 2007. Ali Bahrami, Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-7841 Filed 4-27-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2006-25581 Directorate Identifier 2006-CE-041-AD; Amendment 39-15039; AD 2007-09-07] RIN 2120-AA64 Airworthiness Directives; EADS SOCATA Model TBM 700 Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Final rule. SUMMARY: We are adopting a new airworthiness directive
(AD)for the products listed above. This AD results from mandatory continuing airworthiness information
(MCAI)issued 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: * * * a Nose Landing Gear
(NLG)hinge pin rupture that causes an uncommanded NLG retraction. Investigations identified the unsafe condition resulting from an incomplete thermal treatment done on three hinge pin batches lowering their mechanical properties with a high risk of deformation under service loads. EADS SOCATA notes that an NLG hinge pin rupture could cause an uncommanded NLG retraction during landing. We are issuing this AD to require actions to correct the unsafe condition on these products. DATES: This AD becomes effective June 4, 2007. On June 4, 2007 the Director of the Federal Register approved the incorporation by reference of certain publications listed in this AD. ADDRESSES: You may examine the AD docket on the Internet at *http://dms.dot.gov* or in person at the Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC. FOR FURTHER INFORMATION CONTACT: Albert Mercado, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4119; 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. The 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 AD references the MCAI and related service information that we considered in forming the engineering basis to correct the unsafe condition. The AD contains text copied from the MCAI and for this reason might not follow our plain language principles. Discussion We issued a supplemental notice of proposed rulemaking
(NPRM)to amend 14 CFR part 39 to include an AD that would apply to the specified products. That NPRM was published in the **Federal Register** on February 21, 2007 (72 FR 7838). That NPRM proposed to correct an unsafe condition for the specified products. The MCAI advises of * * * a Nose Landing Gear
(NLG)hinge pin rupture that causes an uncommanded NLG retraction. Investigations identified the unsafe condition resulting from an incomplete thermal treatment done on three hinge pin batches lowering their mechanical properties with a high risk of deformation under service loads. EADS SOCATA notes that an NLG hinge pin rupture could cause an uncommanded NLG retraction during landing. Comments We gave the public the opportunity to participate in developing this AD. We considered the comments received. Comment Issue No. 1: Number of Affected Products EADS SOCATA writes that TBM Aircraft Mandatory Alert Service Bulletin SB 70-147, Amendment 1, dated September 2006, affects 86 nose landing gear
(NLG)(in the worst case 86 products). Further, that among these 86 NLG, only 47 NLG are equipped with defective pins. The FAA agrees that not all aircraft contain the affected NLG part. However, to appropriately identify the product with the affected nose landing gear part serial number, the AD requires to first identify the concerned NLG, then to detect the defective hinge pins installed on the product, and then replace the affected parts. The check of the NLG part serial number for applicability is necessary on all products. Therefore, we are not changing the AD based on this comment. Comment Issue No. 2: Cost of Compliance EADS SOCATA notes that the proposed AD specifies that any required parts would cost about $1,025 for each product and that it would take about 2 work-hours per product to comply with basic requirements of this proposed AD. EADS SOCATA specifies that the identification of the batch number is immediate for products with correct pins. For any product with defective pins, all the costs, work-hours and required parts, associated with TBM Aircraft Mandatory Alert Service Bulletin SB 70-147, Amendment 1, dated September 2006, will be covered under warranty if the defective pins are returned to EADS SOCATA. We have noted EADS SOCATA comments and have revised the costs of compliance to reflect only the labor to identify the NLG part serial number. Our standard warranty language will reflect EADS SOCATA's warranty program. Comment Issue No. 3: Unsafe Condition Description EADS SOCATA comments that the proposed AD describes the unsafe condition associated with TBM Aircraft Mandatory Alert Service Bulletin SB 70-147, Amendment 1, dated September 2006, as an NLG hinge pin rupture that causes an uncommanded NLG retraction. Further, EADS SOCATA estimates that a NLG hinge pin rupture could lead to a nose landing gear collapse in the case of a three-point landing. The FAA notes that the unsafe condition language was copied directly from the Reason section of the associated MCAI. However, to clarify the unsafe condition we will change the AD to add that a NLG hinge pin rupture could cause an uncommanded NLG retraction during landing. Conclusion We reviewed the available data, including the comments received, and determined that air safety and the public interest require adopting the AD with the changes described previously. We determined that these changes will not increase the economic burden on any operator or increase the scope of the AD. Differences Between This 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 required 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 AD. Costs of Compliance We estimate that this AD will affect 256 products of U.S. registry. We also estimate that it will take about 0.5 work-hours per product to comply with basic requirements of this AD. The average labor rate is $80 per work-hour. Based on these figures, we estimate the cost of this AD to the U.S. operators to be $10,240 or $40 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 parts. As we do not control warranty coverage for affected parties, some parties may incur costs higher than estimated here. 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 AD will not have federalism implications under Executive Order 13132. This AD will 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 AD:
(1)Is not a “significant regulatory action” under Executive Order 12866;
(2)Is not a “significant rule” under 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 AD and placed it in the AD Docket. 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 the NPRM, 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. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety. Adoption of the Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA amends 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: **2007-09-07 EADS SOCATA:** Amendment 39-15039; Docket No. FAA-2006-25581; Directorate Identifier 2006-CE-041-AD. Effective Date
(a)This airworthiness directive
(AD)becomes effective June 4, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to all Model TBM 700 airplanes fitted with nose landing gear
(NLG)part number (P/N) 21130-001-02 with serial numbers (S/N) B155 through B173 and S/N EUR 174 through EUR 240, that are certificated in any U.S. category. Subject
(d)Air Transport Association of America
(ATA)Code 32: Landing Gear. Reason
(e)The mandatory continuing airworthiness information
(MCAI)describes the unsafe condition as follows: * * * a Nose Landing Gear
(NLG)hinge pin rupture that causes an uncommanded NLG retraction. Investigations identified the unsafe condition resulting from an incomplete thermal treatment done on three hinge pin batches lowering their mechanical properties with a high risk of deformation under service loads. EADS SOCATA notes that an NLG hinge pin rupture could cause an uncommanded NLG retraction during landing. Actions and Compliance
(f)Within 30 days after June 4, 2007 (the effective date of this AD), unless already done, do the following:
(1)Identify the NLG hinge pin batch number as instructed in paragraph B of the accomplishment instructions of EADS SOCATA TBM Aircraft Mandatory Alert Service Bulletin SB 70-147, Amendment 1, dated September 2006.
(i)For airplanes with the correct pin batch numbers, no further action is required. Return the airplane to service as instructed in EADS SOCATA TBM Aircraft Mandatory Alert Service Bulletin SB 70-147, Amendment 1, dated September 2006.
(ii)For airplanes with pins from the defective pin batch numbers or for which the batch number cannot be read, do all the actions as instructed in paragraphs B 5), C, and D of the accomplishment instructions of EADS SOCATA TBM Aircraft Mandatory Alert Service Bulletin SB 70-147, Amendment 1, dated September 2006.
(2)As of 30 days after June 4, 2007 (the effective date of this AD), do not install on any EADS SOCATA Model TBM 700 airplane an NLG actuator hinge pin coming from the three defective batches identified as EUR BC 21344-000-01, EUR BD 21344-000-01, and EUR BF 21344-000-01 on NLG part number 21130-001-02. FAA AD Differences Note: This AD differs from the MCAI and/or service information as follows: The service bulletin and MCAI require interim operational instructions until the corrective actions are done. This AD requires the corrective action at the same time as the pin batch number check. 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: Albert J. Mercado, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri, 64106; telephone:
(816)329-4119; fax:
(816)329-4090., has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19.
(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)This AD is related to European Aviation Safety Agency Emergency AD No. 2006-0271-E, Issue date: September 4, 2006, which references EADS SOCATA TBM Aircraft Mandatory Alert Service Bulletin SB 70-147, Amendment 1, dated September 2006. Material Incorporated by Reference
(i)You must use EADS SOCATA TBM Aircraft Mandatory Alert Service Bulletin SB 70-147, Amendment 1, dated September 2006, to do the actions required by this AD, unless the AD specifies otherwise.
(1)The Director of the Federal Register approved the incorporation by reference of this service information under 5 U.S.C. 552(a) and 1 CFR part 51.
(2)For service information identified in this AD, contact EADS SOCATA, Direction des Services, 65921 Tarbes Cedex 9, France; telephone: 33 (0)5 62.41.73.00; fax: 33 (0)5 62.41.76.54; or SOCATA Aircraft, INC., North Perry Airport, 7501 Airport Road, Pembroke Pines, Florida 33023; telephone:
(954)893-1400; fax:
(954)964-4141.
(3)You may review copies at the FAA, Central Region, Office of the Regional Counsel, 901 Locust, Room 506, Kansas City, Missouri 64106; or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to: *http://www.archives.gov/federal-register/cfr/ibr-locations.html* . Issued in Kansas City, Missouri, on April 20, 2007. Charles L. Smalley, Acting Manager, Small Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-8003 Filed 4-27-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-27208 Directorate Identifier 2007-CE-010-AD; Amendment 39-15040; AD 2007-09-08] RIN 2120-AA64 Airworthiness Directives; Vulcanair S.p.A. Model P68 Series Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Final rule. SUMMARY: We are adopting a new airworthiness directive
(AD)for the products listed above. This AD results from mandatory continuing airworthiness information
(MCAI)issued 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: The backrest recline of pilot and copilot seats requires the removal of a “quick release pin” not correctly indicated in the AFM and not ready detectable by the passengers. Moreover the operation of removal the device is difficult. This cause difficulty or disables the access to the escapes of the cabin in case of emergency evacuation. We are issuing this AD to require actions to correct the unsafe condition on these products. DATES: This AD becomes effective June 4, 2007. On June 4, 2007 the Director of the Federal Register approved the incorporation by reference of certain publications listed in this AD. ADDRESSES: You may examine the AD docket on the Internet at *http://dms.dot.gov* or in person at the Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC. FOR FURTHER INFORMATION CONTACT: Sarjapur Nagarajan, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4145; 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. The 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 AD references the MCAI and related service information that we considered in forming the engineering basis to correct the unsafe condition. The AD contains text copied from the MCAI and for this reason might not follow our plain language principles. Discussion We issued a notice of proposed rulemaking
(NPRM)to amend 14 CFR part 39 to include an AD that would apply to the specified products. That NPRM was published in the **Federal Register** on March 9, 2007 (72 FR 10620). That NPRM proposed to correct an unsafe condition for the specified products. The MCAI states that: The backrest recline of pilot and copilot seats requires the removal of a “quick release pin” not correctly indicated in the AFM and not ready detectable by the passengers. Moreover the operation of removal the device is difficult. This cause difficulty or disables the access to the escapes of the cabin in case of emergency evacuation. Carry out the operational cheks/inspection/modification: —Kit SB 128/A-1 applicable to aircraft model P68C. Serial numbers (S/N) 429, 434 and 435 are excluded; —Kit SB 128/A-2 applicable only to P68C aircraft with S/N 429, 434 and 435; —Kit SB 128/B applicable to aircraft model P68 Observer 2; —Kit SB 128/C applicable to aircraft model P68TC Observer; called for by the referenced Service Bulletin, in accordance with the procedures in there specified, within the terms set forth under “COMPLIANCE” of this AD. Comments We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM or on the determination of the cost to the public. Conclusion We reviewed the available data and determined that air safety and the public interest require adopting the AD as proposed. Differences Between This 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 required 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 AD. Costs of Compliance We estimate that this AD will affect 15 products of U.S. registry. We also estimate that it will take about 2 work-hours per product to comply with basic requirements of this AD. The average labor rate is $80 per work-hour. Where the service information lists required parts costs that are covered under warranty, we have assumed that there will be no charge for these parts. 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 this AD to the U.S. operators to be $2,400 or $160 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 AD will not have federalism implications under Executive Order 13132. This AD will 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 AD:
(1)Is not a “significant regulatory action” under Executive Order 12866;
(2)Is not a “significant rule” under 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 AD and placed it in the AD Docket. 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 the NPRM, 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. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety. Adoption of the Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA amends 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: **2007-09-08 Vulcanair S.p.A. (Type certificate No. A31EU formerly held by Partenavia Costruzioni Aeronautiche S.p.A.):** Amendment 39-15040; Docket No. FAA-2007-27208; Directorate Identifier 2007-CE-010-AD. Effective Date
(a)This airworthiness directive
(AD)becomes effective June 4, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to Models P68C, P68 Observer 2, and P68TC Observer airplanes, serial numbers 412 through 424 (except 418), 429, 434, and 435, certificated in any category. Subject
(d)Air Transport Association of America
(ATA)Code 51: Structures. Reason
(e)The mandatory continuing airworthiness information
(MCAI)states: The backrest recline of pilot and copilot seats requires the removal of a “quick release pin” not correctly indicated in the AFM and not ready detectable by the passengers. Moreover the operation of removal the device is difficult. This cause difficulty or disables the access to the escapes of the cabin in case of emergency evacuation. Carry out the operational cheks/inspection/modification: —Kit SB 128/A-1 applicable to aircraft model P68C. Serial numbers (S/N) 429, 434 and 435 are excluded; —Kit SB 128/A-2 applicable only to P68C aircraft with S/N 429, 434 and 435; —Kit SB 128/B applicable to aircraft model P68 Observer 2; —Kit SB 128/C applicable to aircraft model P68TC Observer; called for by the referenced Service Bulletin, in accordance with the procedures in there specified, within the terms set forth under “COMPLIANCE” of this AD. Actions and Compliance
(f)Unless already done, do the following actions within 30 days after June 4, 2007 (the effective date of this AD):
(1)For Model P68C airplanes, all serial numbers except 429, 434, and 435: Install Kit SB 128/A-1, following Vulcanair S.p.A. P68 Variants Mandatory Service Bulletin No. 128, dated October 12, 2004;
(2)For Model P68C airplanes, serial numbers 429, 434, and 435: Install Kit SB 128/A-2 following Vulcanair S.p.A. P68 Variants Mandatory Service Bulletin No. 128, dated October 12, 2004;
(3)For Model P68 Observer 2 airplanes, all serial numbers: Install Kit SB 128/B, following Vulcanair S.p.A. P68 Variants Mandatory Service Bulletin No. 128, dated October 12, 2004; or
(4)For Model P68TC Observer airplanes, all serial numbers: Install Kit SB 128/C, following Vulcanair S.p.A. P68 Variants Mandatory Service Bulletin No. 128, dated October 12, 2004. 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: Sarjapur Nagarajan, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone:
(816)329-4145; fax:
(816)329-4090, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19.
(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 Ente Nazionale per l'Aviazione Civile (ENAC), AD N. 2004-522, Rev. 0, dated December 20, 2004; and Vulcanair S.p.A. P68 Variants Mandatory Service Bulletin No. 128, dated October 12, 2004, for related information. Material Incorporated by Reference
(i)You must use Vulcanair S.p.A. P68 Variants Mandatory Service Bulletin No. 128, dated October 12, 2004, to do the actions required by this AD, unless the AD specifies otherwise.
(1)The Director of the Federal Register approved the incorporation by reference of this service information under 5 U.S.C. 552(a) and 1 CFR part 51.
(2)For service information identified in this AD, contact Vulcanair S.p.A, Via G. Pascoli, 7, Casoria (Naples), 80026 Italy; telephone: +39 081 5918111; fax: +39 081 5918172; e-mail: *info@vulcanair.com* ; Internet: *http://www.vulcanair.com.*
(3)You may review copies at the FAA, Central Region, Office of the Regional Counsel, 901 Locust, Room 506, Kansas City, Missouri 64106; or at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to: *http://www.archives.gov/federal-register/cfr/ibr-locations.html.* Issued in Kansas City, Missouri, on April 20, 2007. Charles L. Smalley, Acting Manager, Small Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-8071 Filed 4-27-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF ENERGY Federal Energy Regulatory Commission 18 CFR Part 38 [Docket No. RM05-5-003; Order No. 676-B] Standards for Business Practices and Communication Protocols for Public Utilities Issued April 19, 2007. AGENCY: Federal Energy Regulatory Commission, DOE. ACTION: Final rule. SUMMARY: The Federal Energy Regulatory Commission is amending its regulations under the Federal Power Act to incorporate by reference revisions to the Coordinate Interchange business practice standards (WEQ-004) adopted by the Wholesale Electric Quadrant
(WEQ)of the North American Energy Standards Board (NAESB) on June 22, 2006. These standards identify the processes and communications necessary to coordinate energy transfers that cross boundaries between entities responsible for balancing load and generation. Incorporating these revised standards by reference into the Commission's regulations will ensure that the Coordinate Interchange business practice standards incorporated by reference in the Commission's regulations are compatible with the North American Electric Reliability Council's Interchange Scheduling and Coordination Reliability Standards that the Commission approved as mandatory and enforceable Reliability Standards in Order No. 693. DATES: This Final Rule will become effective May 30, 2007. The incorporation of the standard is approved by the Director of the Federal Register on May 30, 2007. Implementation of the standards is required the later of the date on which the NERC standards become mandatory or the effective date of this rule. FOR FURTHER INFORMATION CONTACT: Patricia Schaub (technical issues), Office of Energy Markets and Reliability, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426,
(202)502-6816. Kay Morice (technical issues), Office of Energy Markets and Reliability, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426,
(202)502-6507. Gary D. Cohen (legal issues), Office of the General Counsel, Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426,
(202)502-8321. SUPPLEMENTARY INFORMATION: Before Commissioners: Joseph T. Kelliher, Chairman; Suedeen G. Kelly, Marc Spitzer, Philip D. Moeller, and Jon Wellinghoff. 1. The Federal Energy Regulatory Commission (Commission) is amending its regulations under the Federal Power Act
(FPA)1 to incorporate by reference revisions to the Coordinate Interchange business practice standards (WEQ-004) adopted by the Wholesale Electric Quadrant
(WEQ)of the North American Energy Standards Board (NAESB) on June 22, 2006. These standards identify the processes and communications necessary to coordinate energy transfers that cross boundaries between entities responsible for balancing load and generation. 1 16 U.S.C. 791a, *et seq.* I. Background 2. NAESB is a non-profit standards development organization established in January 2002 that serves as an industry forum for the development and promotion of business practice standards that promote an efficient marketplace for wholesale and retail natural gas and electricity. Since 1995, NAESB and its predecessor, the Gas Industry Standards Board, have been accredited members of the American National Standards Institute (ANSI), complying with ANSI's requirements that its standards reflect a consensus of the affected industries. 3. NAESB's standards include business practices that streamline the transactional processes of the natural gas and electric industries, as well as communication protocols and related standards designed to improve the efficiency of communication within each industry. NAESB supports all four quadrants of the gas and electric industries—wholesale gas, wholesale electric, retail gas, and retail electric. All participants in the gas and electric industries are eligible to join NAESB and participate in standards development. 4. NAESB's procedures are designed to ensure that all industry members can have input into the development of a standard, whether or not they are members of NAESB, and each standard NAESB adopts is supported by a consensus of the relevant industry segments. 5. The Coordinate Interchange business practice standards (WEQ-004) facilitate the transfer of electric energy between entities responsible for balancing load and generation (Balancing Authorities). The term “Interchange” in this context refers to energy transfers across boundaries between Balancing Authorities. The Coordinate Interchange business practice standards identify the processes needed to facilitate interchange transactions, and specify the arrangements and data to be communicated to the entity responsible for authorizing implementation of interchange transactions (Interchange Authority). 6. The revised Coordinate Interchange business practice standards (WEQ-004) being adopted in this Final Rule replace the earlier version of these standards previously incorporated by reference in the Commission's regulations in Order No. 676. 2 The standards that the Commission incorporated by reference into regulations in Order No. 676 were designed to be consistent with the Version 0 reliability standards of the North American Electric Reliability Council
(NERC)dealing with Coordinate Interchange. 2 *Standards for Business Practices and Communication Protocols for Public Utilities,* Order No. 676, 71 FR 26199 (May 4, 2006), FERC Stats. & Regs., Regulations Preambles ¶ 31,216 (Apr. 25, 2006), *reh'g denied,* Order No. 676-A, 116 FERC ¶ 61,255 (2006). 7. In April, August, and November 2006, NERC filed proposed reliability standards for Commission approval under section 215 of the FPA, including Version 1 and Version 2 standards governing Interchange Scheduling and Coordination (INT Reliability Standards). 8. On June 22, 2006, the WEQ membership ratified revised Coordinate Interchange standards to keep the WEQ's Coordinate Interchange business practices consistent with the applicable NERC INT Reliability Standards. On November 16, 2006, NAESB filed its revised Coordinate Interchange standards with the Commission. 9. On February 20, 2007, the Commission issued a notice of proposed rulemaking to assure that the Commission's business practice standards and reliability standards on Coordinate Interchange would continue to be consistent. 3 The Coordinate Interchange NOPR proposed that the Commission incorporate by reference the revised Coordinate Interchange business practice standards (WEQ-004) adopted by the WEQ on June 22, 2006. 3 *Standards for Business Practices and Communication Protocols for Public Utilities,* Notice of Proposed Rulemaking, 72 FR 8318 (Feb. 27, 2007), FERC Stats. & Regs. ¶ 32,612 (Feb. 20, 2007) (Coordinate Interchange NOPR). 10. In addition, the Coordinate Interchange NOPR noted that NAESB's standards correspond to NERC's Version 1 INT Reliability Standards, and invited comment on whether NERC's Version 2 INT Reliability Standards necessitate any additional business practice standards beyond those discussed in the NOPR. 11. The WEQ revised its Coordinate Interchange business practice standards for three main reasons:
(1)To incorporate business practice standards that had previously been included by NERC in its proposed reliability standards;
(2)to modify the definitions and standards to better integrate with NERC's corresponding reliability standards; and
(3)to eliminate an appendix and update standards to reflect current operating conditions in the Eastern and Western Interconnections, and within the Electric Reliability Council of Texas (ERCOT). 12. On March 16, 2007, the Commission approved NERC's INT Reliability Standards as mandatory and enforceable reliability standards in Order No. 693. 4 4 *Mandatory Reliability Standards for the Bulk-Power System,* Order No. 693, Final Rule, 72 FR 16416 (April 4, 2007), FERC Stats. & Regs. ¶ 31,242 at P 795 through P 887 (Mar. 16, 2007). 13. On March 28, 2007, the New York Independent System Operator, Inc. (NYISO) filed comments in response to the Coordinate Interchange NOPR expressing its general support for NAESB's revisions to the WEQ-004 Standard and stating that it has no objection to incorporating the revised standards into the NYISO's Open Access Transmission Tariff
(OATT)and Market Administration and Control Area Services Tariff (Services Tariff). NYISO requests, however, that the Final Rule not upset any existing waivers of the WEQ-004 Standard the Commission has already granted to entities. NYISO's comments were the only comments filed in response to the Coordinate Interchange NOPR. II. Discussion 14. In this Final Rule, the Commission is amending its regulations under the FPA to incorporate by reference revisions to the Coordinate Interchange business practice standards (WEQ-004) adopted by the Wholesale Electric Quadrant
(WEQ)of the North American Energy Standards Board (NAESB) on June 22, 2006. 5 These standards update the business practice standards used by the electric industry so that they will dovetail with the reliability standards the Commission has approved. Adoption of these revised business practice standards ensures that public utilities comply with a consistent set of standards. To ensure such coordination, public utilities will be required to comply with these standards on the later of the date on which the NERC standards become mandatory or the effective date of this rule. We are pleased with the cooperation and coordination between NAESB and NERC. We appreciate the efforts that these organizations and the industry have made together to ensure that reliability standards and business practice standards work harmoniously. 5 The specific standards developed by the WEQ that we are incorporating by reference in this Final Rule are as follows: Coordinate Interchange (WEQ-004, June 22, 2006) including Purpose, Applicability, and Standards 004-0 through 004-17.2, and 004-A through 004-D. 15. In its revised reliability standards, NERC deleted certain business practice requirements with the expectation that NAESB would include these business practices in its business practice standards. 6 6 The deleted NERC standards include Requirements R1.1, R3, R4, and R5 of INT-001-0, which relate to the timing and content of e-tags, and Requirement R1.1.3 of INT-003-0, which addresses ramp starting time and duration. *See Mandatory Reliability Standards for the Bulk Power System* , Notice of Proposed Rulemaking, 71 FR 64,770 (Nov. 3, 2006), FERC Stats. & Regs. ¶ 32,608 at 32,913 & note 3 (2006). 16. The revised Coordinate Interchange business practice standards the WEQ adopted to replace the deleted NERC standards include: • WEQ Standards 004-1 and 004-3.1 replace NERC INT-001-0 Requirement R1.1. The revised WEQ standards address how requests for Interchange should be made and who is responsible for submitting such requests. • WEQ Standards 004-3, 004-5, 004-8.1, and 004-8.2 replace NERC's INT-001-0 Requirement R3. These standards establish the timing requirements for submitting requests for Interchange. The WEQ's timing table (Appendix D referenced in WEQ Standard 004-8.1) has been revised to better match up with the timing table in NERC's INT-005-1. • WEQ Standard 004-5 replaces NERC's INT-001-0 Requirement R4. This standard addresses the data that should be included in a request for Interchange and who is responsible for ensuring that these data are included in the request for Interchange. • WEQ Standard 004-12 replaces NERC's INT-001-0 Requirement R5. This standard requires that parties involved in an Interchange must have personnel and facilities on site and immediately available to receive notification of changes to the Interchange. • WEQ Standards 004-17, 004-17.1, and 004-17.2 replace NERC's INT-003-0 Requirement R1.1.3. These standards establish the default ramp rates that apply to an Interchange unless otherwise agreed to by the parties involved. 17. The WEQ also modified the Coordinate Interchange definitions and business practice standards to better coordinate with NERC's INT Reliability Standards. This follows the Commission's directive in Order No. 676 that, “[i]n future versions of the standards, NAESB should use the NERC definitions relating to reliability.” 7 The modifications include: 7 Order No. 676 at P 40. • New and revised definitions, such as changing “Reliability Authority” to “Reliability Coordinator”. • Changes to definitions resulting from WEQ's efforts to match the language used in NERC's “Glossary of Terms Used in Reliability Standards” (Glossary) where appropriate. For example, the WEQ added a definition for “Arranged Interchange” using the same language as NERC. • Changes to definitions, such as the “Request for Interchange” definition, where the words are not identical, but are compatible with NERC's, facilitating coordination with the NERC INT Reliability Standards but reflecting the different responsibilities of the two organizations. • Changes to definitions, where NERC does not have a corresponding definition in its Glossary, but the WEQ modified its definitions, such as the “Approval Entity” definition, to reflect the definition changes previously discussed. • Changes to delete definitions no longer needed in the Coordinate Interchange business practice standards or that had been replaced by other definitions. Deleted definitions include: “Checkout Process”; “Interchange Transaction”; “Interchange Transaction Tag”; “Interconnection”; “Market Operator”; “Scheduling Agent”; and “Transmission Service Provider”. • Changes to the Coordinate Interchange business practice standards made to better coordinate with NERC's INT Reliability Standards. The standards were modified to:
(1)incorporate the revised definitions;
(2)provide greater detail, as in WEQ Standard 004-3;
(3)add new standards to clarify and better coordinate with NERC, such as in WEQ Standard 004-2.2; and
(4)delete standards that are no longer appropriate, such as WEQ Standard 004-1.2. 18. The Coordinate Interchange business practices standards were also modified to reflect the current business practices of the Eastern and Western Interconnections and ERCOT. Language previously included in Appendix A was moved to Coordinate Interchange business practice standards 004-3, 004-3.1, and 004-8.2. 19. NYISO requests that the Commission not overturn any existing waivers of the WEQ-004 Standard that the Commission previously granted to entities. NYISO states that, in an order issued on November 16, 2006, the Commission granted it waivers of certain NAESB business practice standards, including certain portions of the WEQ-004 Standard. 8 NYISO points to the waiver it received of WEQ-004-8.1 and Appendices A, B and D, to the extent these components of the WEQ-004 Standard govern physical transmission capacity reservations. In requesting that waiver, the NYISO explained that such standards would not be applicable in the locational-based marginal price
(LBMP)market it operates. NYISO also maintains that entities should not have to reapply for waivers they have already obtained. 8 New York Independent System Operator, Inc., 117 FERC ¶ 61,197 (2006). 20. As we stated in Order No. 676, when parties seek regional or generic variations of the standards, they should raise their concerns in the WEQ standard development process: Now that the WEQ is developing these standards, we prefer that initially all regional and other generic requests for variances, such as to accommodate different business models, be raised during the WEQ standards development process, and we encourage participation by all interested persons in that process. * * * By first submitting the request to the WEQ during development of the standard, the request may be resolved during the WEQ process. Even if the request is not resolved by the WEQ, the process will help create a record should the requester seek a variance or waiver when the standard is presented to the Commission. 9 9 Order No. 676 at P 78. 21. We are very pleased that since the issuance of Order No. 676, parties have sought to raise their regional differences at NAESB, and this effort has resulted in consideration of these issues in the revised Coordinate Interchange Standards that we are adopting in this Final Rule. 10 For example, the WEQ-004 Coordinate Interchange standards have been significantly revised, incorporating regional business practices for the Eastern, Western and ERCOT regions. NAESB also has voted to add a voting segment for ISOs/RTOs so these organizations can have any variance or other issues related to their business model addressed through the NAESB process. Having the industry determine such variances is preferable to having these issues raised in individual waiver requests with the Commission. 10 *See* , *supra* , discussion in P 18. 22. Because the Coordinate Interchange standards for which parties have previously been granted waivers have been revised as discussed above, we find that it will be necessary for all entities who have received waiver of any of the Coordinate Interchange standards to file to request a waiver of the revised standard. While we recognize the burden of having parties reapply for waivers, we cannot rule on individual waiver requests in a generic rulemaking proceeding and cannot determine without a specific waiver request whether any of the changes made by NAESB to the coordinate interchange standards have resolved any of the issues that gave rise to our grant of a waiver of the prior standard. As we stated in Order No. 676, utilities will not be required to comply with any standard for which they request waiver until we act on the waiver request. 11 However, small entities that have obtained waiver of the Order No. 676 standards because they meet the criteria for small public utility waivers provided in Order No. 676 need not apply for a waiver of the revised Coordinate Interchange standards, because their waivers were predicated on their status as small entities, which has not changed. 12 11 Order No. 676 at P 102. 12 Order No. 676 at P 85-87. 23. Parties seeking waivers of the requirements of this Order must file a request on or before the implementation date for this rule, specifying the exact provisions of the standards for which the waiver is sought, and including a full statement of the reasons the applicant believes such a waiver would be appropriate. The request should cover only the Coordinate Interchange business practice standards; waivers of other business practice standards remain unaffected by this Order. III. Implementation Dates and Procedures 24. Utilities are required to implement the Coordinate Interchange standards that we are incorporating by reference in this Final Rule by the later of the date when the Reliability Standards that the Commission approved in Order No. 693 become mandatory or the effective date of this rule. 25. To reduce the burden on filers, as we did in Order No. 676, although public utilities must fully comply with the requirements of this Final Rule as soon as it becomes effective, we are not requiring public utilities immediately to file revised open access transmission tariffs (OATTs) incorporating these changes. When NAESB files the next version of the WEQ's electric standards, if the Commission decides to incorporate the new version of the WEQ's electric standards in its regulations, public utilities will at that time be required to file revised OATTs including these standards. IV. Notice of Use of Voluntary Consensus Standards 26. Office of Management and Budget
(OMB)Circular A-119 (section 11) (February 10, 1998) provides that when a federal agency issues or revises a regulation containing a standard, the agency should publish a statement in the Final Rule stating whether the adopted standard is a voluntary consensus standard or a government-unique standard. In this rulemaking, the Commission is incorporating by reference voluntary consensus standards developed by the WEQ. V. Information Collection Statement 27. OMB's regulations in 5 CFR 1320.11
(2005)require that it approve certain reporting and recordkeeping requirements (collections of information) imposed by an agency. Upon approval of a collection of information, OMB assigns an OMB control number and an expiration date. Respondents subject to the filing requirements of this Final Rule will not be penalized for failing to respond to this collection of information unless the collection of information displays a valid OMB control number. 28. This Final Rule will affect will affect the following existing data collection: Standards for Business Practices and Communication Protocols for Public Utilities (FERC-717) 29. The following burden estimate is based on the projected costs for the industry to implement revisions to the WEQ's Coordinate Interchange standards (WEQ-004). The following burden estimates cover compliance with this rule: Data collection Number of respondents Number of responses per respondent Hours per response Total number of hours FERC-717 220 1 8 1760 Totals 1760 Total Annual Hours for Collection (Reporting and Recordkeeping, (if appropriate)) = 1760. Information Collection Costs: The Commission projects the average annualized cost for all respondents to be the following: 13 13 The total annualized costs for the information collection is $264,000. This number is reached by multiplying the total hours to prepare responses (1760 hours) by an hourly wage estimate of $150 (a composite estimate that includes legal, technical and support staff rates, $90+$35+$25). $264,000 = $150 × 1760. FERC-717 Annualized Capital/Startup Costs $264,000 Annualized Costs (Operations & Maintenance) N/A Total Annualized Costs 264,000 30. The Commission sought comments on the burden of complying with the requirements imposed by these requirements. No comments addressed the reporting burden were filed. 31. The Commission's regulations adopted in this rule are necessary to establish a more efficient and integrated wholesale electric power grid. Requiring such information ensures both a common means of communication and common business practices that provide entities engaged in the wholesale transmission of electric power with timely information and uniform business procedures across multiple transmission providers. These requirements conform to the Commission's goal for efficient information collection, communication, and management within the electric power industry. The Commission has assured itself, by means of its internal review, that there is specific, objective support for the burden estimates associated with the information requirements. 32. OMB regulations 14 require it to approve certain information collection requirements imposed by agency rule. The Commission is submitting notification of this Final Rule to OMB. These information collections are mandatory requirements. 14 5 CFR 1320.11. *Title:* Standards for Business Practices and Communication Protocols for Public Utilities (FERC-717) ( *formerly* Open Access Same Time Information System). *Action:* Proposed collection. *OMB Control No.:* 1902-0173. *Respondents:* Business or other for profit, (Public Utilities—Not applicable to small businesses.). *Frequency of Responses:* One-time implementation (business procedures, capital/start-up). *Necessity of the Information:* This rule will upgrade the Commission's business practice and communication protocols (methods by which computers coordinate their communications) governing Coordinate Interchange transactions to complement the NERC INT Reliability Standards approved by the Commission in Order No. 693. The implementation of these standards and regulations is necessary to increase the efficiency of the wholesale electric power grid. The standards being adopted define procedures for market participants to request the implementation of Interchange Transactions or agreements to transfer energy from a seller to a buyer that crosses one or more Balancing Authority boundaries. 33. The information collection requirements of this Final Rule are based on the transition from transactions being made under the Commission's existing business practice standards governing Coordinate Interchange transactions to conducting such transactions under the revised Coordinate Interchange standards (WEQ-004) adopted in this rule. The implementation of these data requirements will help the Commission carry out its responsibilities under the FPA. The Commission will use the data in rate proceedings to review rate and tariff changes by public utilities, for general industry oversight, and to supplement the documentation used during the Commission's audit process. 34. Interested persons may obtain information on the reporting requirements by contacting: Federal Energy Regulatory Commission, Attn: Michael Miller, Office of the Executive Director, 888 First Street, NE., Washington, DC 20426, Tel:
(202)502-8415 / Fax:
(202)273-0873, E-mail: *michael.miller@ferc.gov.* or by contacting: Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, DC 20503, Attention: Desk Officer for the Federal Energy Regulatory Commission. (Re: OMB Control Nos. 1902-0096 & 1902-0173) , Tel:
(202)395-4650, E-mail: *omb_submissions@omb.eop.gov.* VI. Environmental Analysis 35. The Commission is required to prepare an environmental assessment or an environmental impact statement for any action that may have a significant adverse effect on the human environment. 15 As the Commission stated in the Interchange NOPR, the Commission has categorically excluded certain actions from this requirement as not having a significant effect on the human environment. Included in this categorical exclusion are rules that are clarifying, corrective, or procedural, or that do not substantially change the effect of the regulations being amended. 16 The categorical exclusion also includes information gathering, analysis, and dissemination. 17 The requirements imposed by this Final Rule fall within categorical exclusions in the Commission's regulations for rules that are clarifying, corrective, or procedural, for information gathering, analysis, and dissemination, and for sales, exchange, and transportation of electric power that requires no construction of facilities. 18 As a result, neither an environmental impact statement nor an environmental assessment is required. 15 *Regulations Implementing the National Environmental Policy Act,* Order No. 486, 52 FR 47897, FERC Stats. & Regs., Regulations Preambles 1986-1990 ¶ 30,783 (1987). 16 18 CFR 380.4(a)(2)(ii). 17 18 CFR 380.4(a)(5). 18 *See* 18 CFR 380.4(a)(2)(ii), 380.4(a)(5), 380.4(a)(27). VII. Regulatory Flexibility Act Certification 36. The Regulatory Flexibility Act of 1980
(RFA)19 generally requires a description and analysis of any final rule that will have significant economic impact on a substantial number of small entities. The rule adopted here imposes requirements only on public utilities, which are not small businesses, and these requirements are, in fact, designed to benefit all customers, including small businesses. 19 5 U.S.C. 601-612. 37. The Commission has followed the provisions of both the RFA and the Paperwork Reduction Act on potential impact on small businesses and other small entities. Specifically, the RFA directs agencies to consider four regulatory alternatives to be considered in a rulemaking to lessen the impact on small entities: tiering or establishment of different compliance or reporting requirements for small entities, classification, consolidation, clarification or simplification of compliance and reporting requirements, performance rather than design standards, and exemptions. As the Commission originally stated in Order No. 889, the OASIS regulations now known as “Standards for Business Practices and Communication Protocols for Public Utilities” apply only to public utilities that own, operate, or control transmission facilities subject to the Commission's jurisdiction, and should a small entity be subject to the Commission's jurisdiction, it may file for waiver of these regulations. 20 The Commission is not modifying its prior determinations on this issue in this Final Rule. 20 Small entities that qualified for a waiver from the requirements of Order Nos. 888 and 889 may apply for a waiver of the requirement to comply with the standards incorporated by reference in the regulations we are adopting in this Final Rule. 38. The procedures the Commission is following in this Final Rule are in keeping with exemption provisions of the RFA. Accordingly, pursuant to section 605(b) of the RFA, 21 the Commission hereby certifies that the regulations proposed herein will not have a significant adverse impact on a substantial number of small entities. 21 5 U.S.C. 605(b). VIII. Document Availability 39. In addition to publishing the full text of this document in the **Federal Register** , the Commission provides all interested persons an opportunity to view and/or print the contents of this document via the Internet through the Commission's Home Page ( *http://www.ferc.gov* ) and in the Commission's Public Reference Room during normal business hours (8:30 a.m. to 5 p.m. Eastern time) at 888 First Street, NE., Room 2A, Washington, DC 20426. 40. From the Commission's Home Page on the Internet, this information is available in the eLibrary. The full text of this document is available in the eLibrary both in PDF and Microsoft Word format for viewing, printing, and/or downloading. To access this document in eLibrary, type “RM05-5” in the docket number field. 41. User assistance is available for eLibrary and the Commission's Web site during the Commission's normal business hours. For assistance contact the Commission's Online Support services at *FERCOnlineSupport@ferc.gov* or toll-free at
(866)208-3676, or for TTY, contact
(202)502-8659. IX. Effective Date and Congressional Notification 42. This Final Rule will become effective May 30, 2007. The Commission has determined with the concurrence of the Administrator of the Office of Information and Regulatory Affairs, Office of Management and Budget, that this rule is not a major rule within the meaning of section 251 of the Small Business Regulatory Enforcement Fairness Act of 1996. 22 22 *See* 5 U.S.C. 804(2). List of Subjects 18 CFR Part 38 Conflict of interests, Electric power plants, Electric utilities, Incorporation by reference, Reporting and recordkeeping requirements. By the Commission. Philis J. Posey, Deputy Secretary. In consideration of the foregoing, the Commission amends Chapter I, Title 18, part 38 of the *Code of Federal Regulations,* as follows: PART 38—BUSINESS PRACTICE STANDARDS AND COMMUNICATION PROTOCOLS FOR PUBLIC UTILITIES 1. The authority citation for part 38 continues to read as follows: Authority: 16 U.S.C. 791-825r, 2601-2645; 31 U.S.C. 9701; 42 U.S.C. 7101-7352. 2. In § 38.2, paragraph (a)(4) is revised to read as follows: § 38.2 Incorporation by reference of North American Energy Standards Board Wholesale Electric Quadrant standards.
(a)* * *
(4)Coordinate Interchange (WEQ-004, June 22, 2006); [FR Doc. E7-7892 Filed 4-27-07; 8:45 am] BILLING CODE 6717-01-P RAILROAD RETIREMENT BOARD 20 CFR Part 220 RIN 3220-AB50 Determining Disability AGENCY: Railroad Retirement Board. ACTION: Final rule. SUMMARY: The Board amends its regulations to index the amount of earnings used to determine if an individual is engaged in substantial gainful activity
(SGA)to any increase in the Social Security national average wage index, to increase from $200 to $530 the minimum amount of monthly earnings to count during a trial work period and then index that amount to the Social Security national average wage index. DATES: These rules are effective on April 30, 2007. ADDRESSES: Beatrice Ezerski, Secretary to the Board, Railroad Retirement Board, 844 N. Rush Street, Chicago, Illinois 60611-2092. FOR FURTHER INFORMATION CONTACT: Marguerite P. Dadabo, Assistant General Counsel, Office of General Counsel, Railroad Retirement Board, 844 N. Rush Street, Chicago, Illinois 60611-2092,
(312)751-4945, TDD
(312)751-4701. SUPPLEMENTARY INFORMATION: The Railroad Retirement Act provides for disability annuities for employees, widow(er)s, and children of deceased railroad employees who are unable to engage in any regular employment because of a physical or mental impairment. Regular employment is defined by reference to the definition of substantial gainful activity under the Social Security Act. Sections 220.141 and 220.142 of the Board's regulations reflect this definition and define “substantial gainful activity”
(SGA)as work activity that involves doing significant physical or mental activities for pay or profit. Work activity is gainful if it is the kind of work usually done for pay or profit, whether or not profit is realized. Section 220.143 sets forth earnings levels at which the Board considers a person to be engaged in SGA regardless of the severity of his or her impairment. The amount of average monthly earnings that ordinarily demonstrates SGA was increased effective July 1, 1999, when the Board raised from $500 to $700 the average monthly earnings guidelines used to determine whether work done by a person is substantial gainful activity. These regulations increase certain thresholds for disabled workers. Under this rule, the average monthly earnings guideline, which is used to determine whether work done by disabled workers is substantial gainful activity, is increased to $740.00 for calendar year 2001 and is thereafter automatically adjusted each year based on increases in the Social Security national average wage index. See 42 U.S.C. 409(k)(1). The amount that is used to determine if a disabled individual has performed “services” during a trial work period also is subject to an automatic annual adjustment. These changes conform to changes in the regulations of the Social Security Administration that became final effective January 29, 2001 (65 FR 82905, December 29, 2000). In order to be eligible for disability benefits, an applicant must not be performing substantial gainful activity. A beneficiary's ongoing eligibility for disability benefits is also subject to this rule. Therefore, the Board has established both upper and lower thresholds as guidelines for determining, respectively, what is prima facie evidence of engaging in SGA and what is prima facie evidence of not engaging in SGA. Except for those who work in sheltered workshops, disabled workers with earnings between the two thresholds are subject to further examination. Currently, the upper and lower thresholds are $700 and $300, respectively. For those working in sheltered workshops, earnings below the upper threshold are prima facie evidence that the worker is not performing SGA. Under this rule, beginning January 1, 2001, the upper threshold is adjusted annually, based on the Social Security national average wage index, to conform to the SGA level determined by the Social Security Administration
(SSA)and published in the **Federal Register** each October as part of SSA's notice that includes new adjustments. Under this rule, the SGA amount will never be lower than the previous year's amount. However, there may be years in which there is no increase. As part of this rule, the Board also eliminates the lower SGA threshold so that earnings below the upper threshold would be prima facie evidence that a disabled worker is not engaging in SGA, regardless of whether the worker is working in competitive employment or in a sheltered workshop. The Board also increases the monthly amount that a disabled worker may earn within a trial work period without jeopardizing the amount of time remaining in the trial work period. This change is being made to conform the Board's regulations to the monthly earnings allowed within a trial work period in the regulations of the Social Security Administration. Currently, a disabled worker may test his or her ability to work and still be considered disabled by working during a trial work period. A disabled beneficiary will continue to be considered disabled until the beneficiary performs “service” in at least nine months within a rolling 60-month period. Since 1990, the Board has considered any month in which at least more than $200 is earned to be a month of service. Under the final rule, the threshold amount is increased to $530 for 2001, and then is adjusted annually thereafter based on the Social Security national average wage index to conform to the amount determined by the Social Security Administration and published in the **Federal Register** every October. The Board notes that while the SGA amount has increased since 1990, during the same period, the trial work period services amount has remained unchanged. As with the change shown for the SGA threshold amount, the trial work period amount will never be lower than the previous year's amount. Final Regulations—Background The Board revises Sections 220.143(b)(2) and (b)(4) to adjust annually the earnings guidelines that we use to determine whether an employee is engaged in substantial gainful activity. Beginning January 2001, the average monthly earnings considered to be substantial gainful activity is increased from $700 to $740. Beginning January 2001, the guideline is the higher of the previous year's amount or an increased amount as computed and published by the Social Security Administration based on the Social Security national average wage index. The Board also amends Sec. 220.143(b)(2) and (b)(4) to clarify that this guideline applies to earnings from sheltered work. This standard also applies to the self-employed in certain circumstances by cross-references that have been and continue to be present in Sec. 220.144 of this part. The Board revises Sec. 220.143(b)(3) and (b)(6) to provide, beginning January 2001, that we will ordinarily find that an employee whose average monthly earnings are equal to or less than the “substantial gainful activity amount” set forth in Sec. 220.143(b)(2) has not engaged in substantial gainful activity without considering other information beyond the employee's earnings. The Board also makes conforming changes to Sec. 220.143(b)(4). The Board revises Sec. 220.170 to increase from $200 to $530 the minimum amount of monthly earnings that we consider shows that a person is performing or has performed “services” for counting trial work period months, effective January 1, 2001. We also will adjust the amount annually to the higher of the previous year's amount or an increased amount based on the Social Security national average wage index, beginning January 1, 2002. In addition, effective January 1, 2001, for a self-employed person with net earnings from self-employment equal to or less than the dollar threshold for “services” the Board increases the number of hours of self-employed work in a business each month that the Board will consider shows services are performed from more than 40 hours to more than 80 hours. The Board published the proposed rule on June 9, 2003 (68 FR 34341) and invited comments by August 8, 2003. No comments were received. This final rule is similar to the proposed rule published on June 9, 2003 except for the following changes that have been made to the proposed draft to be more consistent with similar regulations issued by the Social Security Administration
(SSA)and to provide clarification about the subject matter: • § 220.143(b)(2)—A phrase has been added to provide clarification concerning earnings from sheltered employment. • § 220.143(b)(2)(i) and (ii)—The year 2002 in both sections has been changed to 2001 to be more consistent with the other sections being revised. • § 220.143 Table 1—The reference to calendar year 2001 and the corresponding monthly earnings for that year have been eliminated for consistency with the other sections being revised. • § 220.143(b)(4)—The phrase “Before January 1, 2002” has been removed from the heading because the section deals with sheltered employment before and after January 1, 2002. The year 2002 in the first sentence has been changed to 2001 to be more consistent with other sections being revised. The phrase “in paragraph (b)(2)” has been changed to “in Table 1 of this section” wherever it appears. A new sentence was added at the end of this subsection to explain what occurs for months beginning January 1, 2001 for claimants working in sheltered workshops. • § 220.143(b)(6)(i) and (ii)—The year 2002 in both sections has been changed to 2001 to be more consistent with the other sections being revised. • § 220.170(b)—The first two sentences of this subsection have been revised to clarify the description of what is meant by “services.” • § 220.170(b)(2)(ii)—This subsection has been revised to state that if an individual performed more than 80 hours, instead of the previous limit of 40 hours, of self-employed activities in a business in a month beginning in calendar year 2001, the Board will consider services were performed. • § 220.170(b) Table 1—This table has been revised to show the $200 limit applies in calendar years 1990-2000, not 1990-2001 as shown in the proposed rule. Table 2—This table has been revised to change the hours of work for a self-employed individual from 40 hours to 80 hours beginning in calendar year 2001. The most significant revision to the proposed rule that was published in June, 2003 increases the minimum monthly hours of work from 40 to 80 that show a self-employed individual performed services. This change makes the Board's regulations consistent with those of the Social Security Administration, which were also modified when a final rule was published by that agency on December 29, 2000, to show 80 hours. This change is less restrictive and will encourage beneficiaries with disabilities to more realistically test their ability to work with respect to self-employment activities. Collection of Information Requirements The amendments to this part do not impose information collection and record keeping requirements. Consequently, it need not be reviewed by the Office of Management and Budget under the authority of the Paperwork Reduction Act of 1995. Regulatory Impact Statement The primary purpose of this rule is to conform the Railroad Retirement Board rules governing substantial gainful activity and a trial work period to the regulations of the Social Security Administration. The Board published a proposed rule to amend these sections on June 9, 2003 (68 FR 34341) and invited comments by August 8, 2003. No comments were received. The draft final rule is similar to the proposed rule except for the changes identified in the Supplementary Information. The single most significant revision to the proposed rule that was published in June 2003 increases the minimum monthly hours of work from 40 to 80 that show that a self-employed individual performed services. This change and the other changes made by the final draft rule, like the changes in the published proposed regulation, have been made in order to make the regulations of the Railroad Retirement Board more consistent with similar regulations issued by the Social Security Administration and to provide clarification about the subject matter. In addition, the changes made by this rule will generally make the current regulatory provisions less restrictive in order to encourage individuals to try to return to work. For all of these reasons, the decision was made to have the rule take effect upon publication. Prior to publication of this final rule, the Board submitted the rule to the Office of Management and Budget for review pursuant to Executive Order 12866. Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). A regulatory impact analysis
(RIA)must be prepared for rules that constitute significant regulatory action, including rules that have an economic effect of $100 million or more annually. This final rule is not a major rule in terms of the aggregate costs involved. Specifically, we have determined that this final rule is not a major rule with economically significant effects because it would not result in increases in total expenditures of $100 million or more per year. The amendments made by this final rule are significant. The amendments to §§ 220.143 and 220.170 will index the amount of earnings used to determine if an individual is engaged in substantial gainful activity
(SGA)to any increase in the Social Security national average wage index, and increases from $200 to $530 the minimum amount of monthly earnings to count during a trial work period, and then index that amount to the Social Security national average wage index. Both the Regulatory Flexibility Act and the Unfunded Mandates Act of 1995 define “agency” by referencing the definition of “agency” contained in 5 U.S.C. 551(l). Section 551(l)(E) excludes from the term “agency” an agency that is composed of representatives of the parties or of representatives of organizations of the parties to the disputes determined by them. The Railroad Retirement Board falls within this exclusion (45 U.S.C. 231f(a)) and is therefore exempt from the Regulatory Flexibility Act and the Unfunded Mandates Act. Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a rule that imposes substantial direct compliance costs on State and local governments, preempts State law, or otherwise has Federalism implications. We have reviewed this final rule under the threshold criteria of Executive Order 13132 and have determined that it would not have a substantial direct effect on the rights, roles, and responsibilities of States or local governments. In accordance with the provisions of Executive Order 12866, this regulation has been reviewed by the Office of Management and Budget. List of Subjects in 20 CFR Part 220 Railroad Retirement. For the reasons stated in the preamble, the Railroad Retirement Board amends part 220 of chapter II of title 20 of the Code of Federal Regulations as follows: PART 220—DETERMINING DISABILITY 1. The authority citation for part 220 continues to read as follows: Authority: 45 U.S.C. 231a; 45 U.S.C. 231f. Subpart L—Substantial Gainful Activity 2. Section 220.143 is amended by revising paragraphs (b)(2), (b)(3), (b)(4), and (b)(6) to read as follows: § 220.143 Evaluation guides for an employed claimant.
(b)* * *
(2)*Earnings that will ordinarily show that the claimant has engaged in substantial gainful activity.* The Board will consider that the earnings from the employed claimant (including earnings from sheltered work, see paragraph (b)(4) of this section) show that the claimant engaged in substantial gainful activity if:
(i)*Before January 1, 2001* , the earnings averaged more than the amount(s) in Table 1 of this section for the time(s) in which the claimant worked.
(ii)*Beginning January 1, 2001* , the earnings are more than an amount determined for each calendar year to be the larger of:
(A)The amount for the previous year, or
(B)The amount established by the Social Security Administration to constitute substantial gainful activity for such year. Table 1.—Amounts Indicating Substantial Gainful Activity Performed For months Monthly earnings averaged more than In calendar years before 1976 $200 In calendar year 1976 230 In calendar year 1977 240 In calendar year 1978 260 In calendar year 1979 280 In calendar years 1980-1989 300 January 1990-June 1999 500 July 1999-December 2000 700
(3)*Earnings that will ordinarily show that the claimant has not engaged in substantial gainful activity.* Beginning January 1, 2001, if the claimant's earnings are equal to or less than the amount(s) determined under paragraph (b)(2)(ii) of this section for the year(s) in which the claimant works, the Board will generally consider that the earnings from the claimant's work as an employee will show the claimant has not engaged in substantial gainful activity. Before January 1, 2001, if the claimant's earnings were less than the amount(s) in Table 2 of this section for the year(s) in which the claimant worked, the Board will generally consider that the earnings from the claimant's work as an employee will show that the claimant has not engaged in substantial gainful activity. Table 2.—Amounts Indicating Substantial Gainful Activity Not Performed For months Monthly earnings averaged less than In calendar years before 1976 $130 In calendar year 1976 150 In calendar year 1977 160 In calendar year 1978 170 In calendar year 1979 180 In calendar years 1980-1989 190 In calendar years 1990-2000 300
(4)*If the claimant worked in a sheltered workshop.* Before January 1, 2001 if the claimant worked in a sheltered workshop or a comparable facility especially set up for severely impaired persons, the Board will ordinarily consider that the claimant's earnings from this work show that the claimant has engaged in substantial gainful activity if the claimant's earnings average more than the amounts in Table 1 of this section. Average monthly earnings from a sheltered workshop or a comparable facility that are equal to or less than those indicated in Table 1 of this section will ordinarily show that the claimant has not engaged in substantial gainful activity without the need to consider the other information, as described in paragraph (b)(6) of this section, regardless of whether they are more or less than those indicated in paragraph (b)(3) of this section. When the claimant's earnings from a sheltered workshop or comparable facility are equal to or less than those amounts indicated in Table 1 of this section, the Board will consider the provisions of paragraph (b)(6) of this section only if there is evidence that the claimant may have done substantial gainful activity. For work performed in a sheltered workshop or comparable facility beginning January 1, 2001, the rules of paragraph (b)(2), (3), and
(6)apply the same as they do to any other work done by an employee.
(6)*Earnings that are not high enough to ordinarily show that the claimant engaged in substantial gainful activity.*
(i)Before January 1, 2001, if the claimant's average monthly earnings were between the amounts shown in paragraphs (b)(2) and
(3)of this section, the Board will generally consider other information in addition to the claimant's earnings (see paragraph (b)(6)(iii) of this section). This rule generally applies to employees who did not work in a sheltered workshop or a comparable facility, although the Board may apply it to some people who work in sheltered workshops or comparable facilities (see paragraph (b)(4) of this section).
(ii)Beginning January 1, 2001, if the claimant's average monthly earnings are equal to or less than the amounts determined under paragraph (b)(2) of this section, the Board will generally not consider other information in addition to the claimant's earnings unless there is evidence indicating that the claimant may be engaging in substantial gainful activity or that the claimant is in a position to defer or suppress his or her earnings.
(iii)Examples of other information the Board may consider include, whether—
(A)The claimant's work is comparable to that of unimpaired people in the claimant's community who are doing the same or similar occupations as their means of livelihood, taking into account the time, energy, skill, and responsibility involved in the work, and
(B)The claimant's work, although significantly less than that done by unimpaired people, is clearly worth the amounts shown in paragraph (b)(2) of this section, according to pay scales in the claimant's community. Subpart N—Trial Work Period and Reentitlement Period for Annuitants Disabled for any Regular Employment 3 . Section 220.170 is amended by revising paragraph
(b)to read as follows: § 220.170 The trial work period.
(b)*What the Board means by services.* When used in this section, services means any activity (whether legal or illegal), even though it is not substantial gainful activity, which is done in employment or self-employment for pay or profit, or is the kind normally done for pay or profit. We generally do not consider work done without remuneration to be services if it is done merely as therapy or training, or if it is work usually done in a daily routine around the house, or in self-care.
(1)*If the claimant is an employee.* The Board will consider the claimant's work as an employee to be services if:
(i)Before January 1, 2002, the claimant's earnings in a month were more than the amount(s) indicated in Table 1 of this section for the year(s) in which the claimant worked.
(ii)*Beginning January 1, 2002* , the claimant's earnings in a month are more than an amount determined for each calendar year to be the larger of:
(A)Such amount for the previous year, or
(B)The amount established by the Social Security Administration for such year as constituting the amount of monthly earnings used to determine whether a person has performed services for counting trial work period months.
(2)*If the claimant is self-employed* . The Board will consider the claimant's activities as a self-employed person to be services if:
(i)*Before January 1, 2002* , the claimant's net earnings in a month were more than the amount(s) indicated in Table 2 of this section for the year(s) in which the claimant worked, or the hours the claimant worked in the business in a month are more than the number of hours per month indicated in Table 2 for the years in which the claimant worked.
(ii)*Beginning January 1, 2002* , the claimant worked more than 80 hours a month in the business, or the claimant's net earnings in a month are more than an amount determined for each calendar year to be the larger of:
(A)Such amount for the previous year, or
(B)The amount established by the Social Security Administration for such year as constituting the amount of monthly earnings used to determine whether a person has performed services for counting trial work period months. Table 1.—For Non Self-Employed For months You earn more than In calendar years before 1979 $50 In calendar years 1979-1989 75 In calendar years 1990-2000 200 In calendar year 2001 530 Table 2.—For the Self-Employed For months Your net earnings are more than Or you work in the business more than (hours) In calendar years before 1979 $50 15 In calendar years 1979-1989 75 15 In calendar years 1990-2000 200 40 In calendar year 2001 530 80 Dated: April 24, 2007. By Authority of the Board. Beatrice Ezerski, Secretary to the Board. [FR Doc. E7-8155 Filed 4-27-07; 8:45 am] BILLING CODE 7905-01-P DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Parts 1 and 602 [TD 9324] RIN 1545-BF04 Designated Roth Accounts Under Section 402A AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Final Regulations. SUMMARY: This document contains final regulations under sections 401(k), 402(g), 402A, and 408A of the Internal Revenue Code
(Code)relating to designated Roth accounts. These final regulations provide guidance concerning the taxation of distributions from designated Roth accounts under qualified cash or deferred arrangements under section 401(k). These final regulations will affect administrators of, employers maintaining, participants in, and beneficiaries of section 401(k) and section 403(b) plans, as well as owners and beneficiaries of Roth IRAs and trustees of Roth IRAs. DATES: *Effective Date:* These final regulations are effective April 30, 2007. *Applicability Date:* These regulations generally apply to taxable years beginning on or after January 1, 2007. For dates of applicability, see §§ 1.401(k)-1(f)(6), 1.402A-1, A-15, 1.402A-2, A-4 and 1.408A-10, A-6. FOR FURTHER INFORMATION CONTACT: R. Lisa Mojiri-Azad or William D. Gibbs at 202-622-6060, or Cathy A. Vohs, 202-622-6090 (not toll-free numbers). SUPPLEMENTARY INFORMATION: Paperwork Reduction Act The collection of information contained in these final regulations was reviewed and approved by the Office of Management and Budget
(OMB)for review in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) under control number OMB-1545-1992. The collection of information in these final regulations is in 26 CFR 1.402A-2. This information is required to comply with the separate accounting and recordkeeping requirements of section 402A. This information will be used by the IRS and employers maintaining designated Roth accounts to insure compliance with the requirements of section 402A. The collection of information is required to obtain a benefit. The likely recordkeepers are state or local governments, business or other for-profit institutions, nonprofit institutions, and small businesses or organizations. The estimated annual burden per respondent under control number OMB-1545-1992 is 2.3 hours. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number assigned by the Office of Management and Budget. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103. Background This document contains final regulations under section 402A, and amendments to regulations under sections 401(k), 402(g), and 408A of the Internal Revenue Code. Section 402A, which sets forth rules for designated Roth contributions, was added to the Code by section 617(a) of the Economic Growth and Tax Relief Reconciliation Act of 2001, Public Law 107-16 (115 Stat. 103) (EGTRRA), effective for taxable years beginning after December 31, 2005. These final regulations also reflect certain provisions of the Pension Protection Act of 2006, Public Law 109-280, (120 Stat. 780) (PPA '06), including section 811 of PPA '06, which repealed the sunset provisions of EGTRRA with respect to section 402A. Section 401(k) sets forth rules for qualified cash or deferred arrangements under which an employee may make an election between cash and an employer contribution to a plan qualified under section 401(a). Section 403(b) permits a similar salary reduction agreement under which payments are made to a section 403(b) plan. Section 402(e)(3) provides that an amount is not includible in an employee's income merely because the employee has an election whether these contributions will be made to the trust or annuity or received by the employee in cash. Amounts contributed pursuant to these qualified cash or deferred arrangements and salary reduction agreements are defined in section 402(g)(3) as elective deferrals. Section 402(g)(1) provides a limit on the amount of elective deferrals that may be excluded from an employee's income for a taxable year. Section 402(g)(2) provides for the distribution of elective deferrals that exceed the annual limit on elective deferrals (an excess deferral). A designated Roth contribution is an elective deferral, as described in section 402(g)(3)(A) or (C), that has been designated by an employee, pursuant to section 402A, as not excludable from the employee's gross income. Under section 402A(b)(2), designated Roth contributions must be maintained by the plan in a separate account (a designated Roth account). Under section 402(a), a distribution from a plan qualified under section 401(a) is taxable under section 72 to the distributee in the taxable year distributed. However, pursuant to section 402A(d)(1), a qualified distribution from a designated Roth account is excludable from gross income. A qualified distribution is defined in section 402A(d)(2) as a distribution that is made after completion of a specified 5-year period and the satisfaction of other specified requirements. If the distribution is not a qualified distribution, pursuant to section 72, the distribution is included in the distributee's gross income to the extent allocable to income on the contract and excluded from gross income to the extent allocable to investment in the contract (basis). The amount of a distribution allocated to investment in the contract is generally determined by applying to the distribution the ratio of the investment in the contract to the account balance. Section 402(c) provides rules under which certain distributions from a plan qualified under section 401(a) may be rolled over into another eligible retirement plan. In such a case, the distribution is not currently includible in the distributee's gross income. Under section 402(c)(2), as amended by section 822 of PPA '06, to the extent some or all of the distribution from a plan qualified under section 401(a) would not have been includible in gross income if it were not rolled over, that portion of the distribution can only be rolled over into an individual retirement plan, or through a direct rollover to another qualified plan or section 403(b) plan that agrees to separately account for such rolled over amounts. Section 403(b)(8)(B) provides that the rules of section 402(c)(2) also apply for purposes of the rollover rules under section 403(b)(8). Under section 402(c)(8) and 402A(c)(3), a distribution from a designated Roth account can be rolled over only to another designated Roth account or to a Roth IRA. Under section 408A, a Roth IRA is a type of individual retirement plan
(IRA)under which contributions are never deductible and qualified distributions are excludable from gross income. Section 408A(d)(4) sets forth special ordering rules for the return of basis in the case of a distribution from a Roth IRA. Under the section 408A(d)(4) ordering rules, in a nonqualified distribution from a Roth IRA, basis is recovered before income. Section 617(d) of EGTRRA amended section 6051(a)(8) to require the reporting of designated Roth contributions on Form W-2, “Wage and Tax Statement,” and added a new subsection
(f)to section 6047 to require plan administrators or other responsible persons of section 401(k) or 403(b) plans to make such returns and reports regarding designated Roth contributions to the Secretary of the Treasury and such other persons the Secretary may prescribe. Final regulations under section 401(k) were issued on December 29, 2004 (69 FR 78144). Those final regulations reserved § 1.401(k)-1(f) for special rules for designated Roth contributions. On January 3, 2006, final regulations were issued that fill in that reserved paragraph and provide additional rules applicable to designated Roth contributions (71 FR 6). The provisions of the final regulations under section 401(k) regarding designated Roth contributions do not address the taxability of distributions from designated Roth accounts or the reporting requirements that apply to contributions of designated Roth contributions or distributions from the accounts. On January 26, 2006, a notice of proposed rulemaking (REG-146459-05) under section 402A was published in the **Federal Register** (71 FR 4322). The proposed regulations also would have provided guidance with respect to designated Roth contributions under section 403(b) plans by amending the proposed regulations under section 403(b), published in the **Federal Register** on November 16, 2004 (69 FR 67075). This guidance has not been finalized in this Treasury Decision, but will instead be included in the final regulations under section 403(b). Written comments responding to the notice of proposed rulemaking under section 402A were received. A public hearing was held on July 26, 2006. After consideration of all comments, these final regulations adopt the provisions of the proposed regulations with certain modifications, the most significant of which are highlighted below. These final regulations under section 402A are intended to provide comprehensive guidance on the taxation of distributions from designated Roth accounts under section 401(k) and section 403(b) plans. These regulations also provide guidance on the reporting requirements with respect to these accounts and include amendments to the provisions of the final section 401(k) regulations relating to designated Roth contributions. In addition, these final regulations include amendments to the regulations under section 402(g) issued in 1991 in order to reflect the enactment of section 402A (as well as other statutory changes since those regulations were issued) and to make changes to conform the regulations under section 402(g) to the final section 401(k) regulations. These final regulations also add a new § 1.408A-10 to the existing regulations under section 408A for Roth IRAs (§ 1.408A-1 through 9) issued in 1999 to reflect the interaction between section 408A and section 402A. Explanation of Provisions Overview These final regulations, like the proposed regulations, provide guidance on the taxation of distributions from designated Roth accounts and other related issues. A designated Roth account is a separate account under a section 401(k) plan or section 403(b) plan to which designated Roth contributions are made, and for which separate accounting of contributions, gains, and losses are maintained. These final regulations retain the rule from the proposed regulations that any transaction or accounting methodology involving an employee's designated Roth account and any other accounts under the plan or plans of an employer that has the effect of directly or indirectly transferring value from another account into the designated Roth account violates the separate accounting requirement under section 402A. The taxation of a distribution from a designated Roth account depends on whether or not the distribution is a qualified distribution. A qualified distribution from a designated Roth account is not includible in the employee's gross income. A qualified distribution is generally a distribution that is made after a 5-taxable-year period of participation and that either
(1)is made on or after the date the employee attains age 59 1/2 ,
(2)is made after the employee's death, or
(3)is attributable to the employee's being disabled within the meaning of section 72(m)(7). In response to comments, these final regulations clarify that, in the case of distribution to an alternate payee or beneficiary, the age, death or disability of the participant are used to determine whether the distribution is qualified. The only exception is in the case of a rollover by an alternate payee or surviving spouse to a designated Roth account under a plan of his or her own employer. Determination of 5-Taxable-Year Period for Qualified Distributions In order for a distribution from a designated Roth account to be a qualified distribution and thus not includible in gross income, a 5-taxable-year requirement must be satisfied. These final regulations, like the proposed regulations, reflect the rule in section 402A that the 5-taxable-year period during which a distribution is not a qualified distribution begins on the first day of the employee's taxable year for which the employee first had designated Roth contributions made to the plan and ends when 5 consecutive taxable years have been completed. However, if a direct rollover is made from a designated Roth account under another plan, the 5-taxable-year period for the recipient plan begins on the first day of the employee's taxable year for which the employee first had designated Roth contributions made to the other plan, if earlier. Commentators inquired as to when designated Roth contributions made by a reemployed veteran for a year of qualified military service pursuant to section 414(u), are treated as made for purposes of the 5-taxable-year period of participation. In response to these comments, the final regulations provide that designated Roth contributions made by a reemployed veteran are treated as made in the taxable year with respect to which the contributions relate. Reemployed veterans may identify the year for which a contribution is made for other purposes, such as for entitlement to a match, and the treatment for the five year period of participation rule follows that identification. Absent such an identification, for purposes of determining the first year of the five years of participation under section 402A(d)(2)(B), the contribution is treated as made in the veteran's first taxable year in which the veteran's qualified military service begins, or if later, the first taxable year in which designated Roth contributions could be made under the plan. Commentators asked how the 5-taxable-year period of participation rule applies to a required minimum distribution made for an earlier year, such as a distribution made on April 1 following the year an employee attains age 70 1/2 . They also asked whether, if payments under an annuity stream commence before a qualifying event, the payments after the qualifying event could be qualified distributions (assuming the 5-year period of participation is satisfied). The determination of whether a payment is a qualified distribution is determined based upon the actual year of the payment from the account and does not take into account whether the payment is part of a series of distributions or whether the payment is attributable to a prior calendar year. In response to comments, these final regulations provide that certain contributions do not start the 5-taxable-year period of participation. For example, a year in which the only contributions consist of excess deferrals will not start the 5-taxable-year period of participation. Further, excess contributions that are distributed to prevent an ADP failure also do not begin the 5-taxable-year period of participation. Finally, contributions returned to the employee pursuant to section 414(w) also do not start the 5-taxable-year period of participation. Taxation of Nonqualified Distributions These final regulations retain the rules from the proposed regulations for taxation of nonqualified distributions and provide that a distribution from a designated Roth account that is not a qualified distribution is taxable to the distributee under section 402 (or section 403(b)(1)), treating the designated Roth account as a separate contract under section 72. In applying that treatment, the portion of any distribution that is includible in gross income as an amount allocable to income on the contract and the portion not includible in income as an amount allocable to investment in the contract is generally determined under section 72(e)(8) (or, in the case of an amount received as an annuity, section 72
(b)or (d), as applicable). Some commentators requested that the special ordering rules in section 408A(d), which provide that the first distributions from a Roth IRA are a return of contributions (and thus not includible in gross income) until all contributions have been returned as basis, be applied to distributions from a designated Roth account. They noted that a pro rata basis recovery rule in section 72 is difficult to explain to employees receiving a hardship distribution from a designated Roth account because the entire distribution reduces the amount of elective contributions (including designated Roth contributions) available for hardship distribution while, for purposes of determining the amount includible in income under sections 402(a) and 72, only a portion of the distribution is treated as recovery of basis attributable to the designated Roth contributions. As noted in the preamble to the proposed regulations, because section 402A does not provide that the special ordering rules of section 408A(d) apply to distributions from designated Roth accounts, these final regulations do not apply those special ordering rules. Although designated Roth contributions to a designated Roth account bear some similarity to contributions to a Roth IRA (e.g., contributions to either type of account are after-tax contributions, and qualified distributions from either type of account are excludable from gross income), there are many differences between these types of arrangements. The only special rule under section 402A for nonqualified distributions from a designated Roth account is that the account is treated as a separate contract for purposes of section 72. Thus, these final regulations do not apply the basis recovery rules in section 408A to distributions from designated Roth accounts. Furthermore, the limit on elective contributions available for hardship distribution is an aggregate limit that takes into account both pre-tax elective contributions and designated Roth contributions. For example, an employee could take all hardship distributions from the pre-tax account, even though part of the amount available for hardship is attributable to designated Roth contributions. Thus, the amount of elective deferrals available for distribution from a designated Roth account on account of hardship generally would be a different amount than the total designated Roth contributions even if the ordering rule in section 408A(d)(4) applied to distributions from designated Roth accounts. Rollover of Designated Roth Contributions As described above in the Background section of this preamble, section 402(c)(2), after amendment by section 822 of PPA ‘06, provides that, if a portion of the distribution from a plan qualified under section 401(a) is not includible in income (determined without regard to the rollover), that portion of the distribution can only be rolled over by a direct rollover of the distribution to another qualified plan, or to a section 403(b) plan, that provides for separate accounting for amounts transferred (and earnings thereon) including separate accounting for the portion of such distribution which is includible in gross income and the portion of such distribution that is not so includible. Alternatively, the distribution can be rolled over to an IRA in either a 60-day rollover or direct rollover. Section 402A(c)(3) provides that a rollover contribution of a distribution from a designated Roth account may only be made to the extent it is otherwise allowable. Section 402(c)(2) provides rules regarding when a rollover contribution of amounts not includable in gross income are allowable. As noted in the preamble to the proposed regulations, the IRS and Treasury Department believe that the rules in section 402(c)(2) relating to the rollover of a distribution of an amount not includable in gross income apply to a distribution from a designated Roth account. 1 Thus, these regulations retain the rule in the proposed regulations that, in order to roll over any portion of the basis in a designated Roth account into a designated Roth account under another plan, the rollover of the distribution must be accomplished through a direct rollover (i.e., a rollover to another designated Roth account is not available for the portion of the distribution not includible in gross income if the distribution is made directly to the employee). However, for purposes of these regulations, the requirement that the receiving plan separately account for designated Roth contributions that are rolled over has been eliminated because such contributions are independently subject to the separate account requirement of Treas. Reg. § 1.401(k)-1(f). 2 1 For distributions from designated Roth accounts, there is the same need for proper accounting of investment in the contract as for distributions from other accounts that include after-tax contributions. In addition, it is necessary to track whether the employee has satisfied the 5-year rule for qualified distributions. 2 The proposed regulations would have reflected the rule in section 402(c)(2) prior to amendment by PPA ‘06 that limited rollovers of distributions from qualified plans that are not includible in gross income to direct rollovers to other qualified trusts and not to section 403(b) plans. These final regulations do not retain this restriction on rollovers because of the amendments to section 402(c) made by section 822 of PPA ‘06. In response to comments, the final regulations clarify that, for purposes of these regulations, if any amount is paid as a direct rollover, that amount is treated as a separate distribution from any amount paid directly to the distributee for purposes of applying section 402(c)(2). Finally, to insure that there is proper accounting in the recipient plan, as described under the heading *Reporting and Recordkeeping,* these final regulations retain the provision in the proposed regulations requiring the distributing plan making the direct rollover is required to report the amount of the investment in the contract and the first year of the 5-year period to the recipient plan so that the recipient plan will not need to rely on information from the distributee. In response to comments, the definition of designated Roth account has been revised to clarify that the definition only includes accounts under a plan to which designated Roth contributions are made in lieu of elective contributions or deferrals. Thus, the final regulations clarify that a distribution from a designated Roth account may only be rolled over to a section 401(k) plan or section 403(b) plan if that has a designated Roth program. As in the proposed regulations, the final regulations provide that if the entire amount of a distribution from a designated Roth account is rolled over to another designated Roth account, the amount of the rollover contribution allocated to investment in the contract in the recipient designated Roth account is the amount that would not have been includible in gross income (determined without regard to section 402(e)(4)) if the distribution had not been rolled over. Thus, if an amount that is a qualified distribution is rolled over, the entire amount of the rollover contribution is allocated to investment in the contract. In response to comments, the final regulations clarify that, if the entire account balance of a designated Roth account is rolled over to another designated Roth account, and, at the time of the distribution, the investment in the contract exceeds the balance in the designated Roth account, the investment in the contract in the distributing plan is included in the investment in the contract of the recipient plan. 3 3 If the investment in the contract exceeds the account balance and the entire account balance is distributed (and not rolled over), see Rev. Rul. 72-305, 1972-1 C.B. 116, for guidance concerning a deduction for the difference. If a distribution from a designated Roth account is made to an employee, the employee is still able to roll over the entire amount (or any portion thereof) into a Roth IRA within a 60-day period. Under section 402(c)(2), if only a portion of the distribution is rolled over, the portion that is rolled over is treated as consisting first of the amount of the distribution that is includible in gross income. These final regulations, like the proposed regulations, provide that the income limits for contributions for Roth IRAs do not apply for this purpose. Alternatively, the proposed regulations provided that the employee is permitted to roll over the taxable portion of the distribution to a designated Roth account within a 60-day period. In such a case, additional reporting is required from the recipient plan, as described below under the heading *Reporting and Recordkeeping.* In addition, the employee's period of participation under the distributing plan is not carried over to the recipient plan for purposes of determining whether the employee satisfies the 5-taxable-year requirement under the recipient plan. Commentators objected to this different treatment for indirect rollover contributions claiming that it reduces portability. The IRS and Treasury Department believe that this rule is more consistent with the statutory language and will further encourage direct rollover of distributions from designated Roth accounts which will reduce leakage of these distributions from retirement savings solution. Thus, this rule is retained in the final regulations. However, the final regulations provide that such an indirect rollover contribution starts the 5-taxable-year period of participation under the receiving plan for a participant who has made no prior designated Roth contributions to that plan. Determination of 5-Taxable-Year Period After a Rollover to a Roth IRA Section 402A and section 408A each provide for a 5-taxable-year period that must be completed in order for a distribution from a designated Roth account or a Roth IRA to be a qualified distribution. However, each of these sections contains different rules for determining when the 5-taxable-year requirement is satisfied. Generally, under section 402A, satisfaction of the 5-taxable-year requirement with respect to a designated Roth account under a plan is based on the years since a designated Roth contribution was first made by the employee under that plan. In contrast, the 5-year period under section 408A begins with the first taxable year for which a contribution is made to any Roth IRA. Commentators suggested that, if a distribution from a designated Roth account to an individual is rolled into a Roth IRA, the individual receive credit under the 5-year rule in section 408A for the years since the individual first made a contribution to a designated Roth account. As noted in the preamble to the proposed regulations, the IRS and Treasury Department do not believe that the Code provides for this interaction between the two 5-year rules. Thus, these final regulations retain the rule under the proposed regulations that the 5-taxable-year period described in section 402A and the 5-taxable-year period described in section 408A(d)(2)(B) are determined independently. Thus, in the case of a rollover of a distribution from a designated Roth account maintained under a section 401(k) or 403(b) plan to a Roth IRA, the final regulations, like the proposed regulations, provide that the period that the rolled-over funds were in the designated Roth account does not count towards the 5-taxable-year period for determining qualified distributions from the Roth IRA. However, if an individual had established a Roth IRA in a prior year, the 5-year period for determining qualified distributions from a Roth IRA that began as a result of that earlier Roth IRA contribution applies to any distributions from the Roth IRA (including a distribution of an amount attributable to a rollover contribution from a designated Roth account). If a nonqualified distribution from a designated Roth account is rolled over into a Roth IRA, the portion of the distribution that constitutes a nontaxable return of investment in the contract is treated as basis in the Roth IRA. However, the final regulations, like the proposed regulations, provide that, if a qualified distribution from a designated Roth account is rolled over into a Roth IRA, the entire amount of the distribution will be treated as basis in the Roth IRA. As a result, a subsequent distribution from the Roth IRA in the amount of the rollover would be treated as a tax-free return of basis regardless of whether the individual had maintained a Roth IRA for 5 years (although the investment return on that amount earned in the Roth IRA would not be excluded from income when distributed unless the distribution satisfied the requirements for a qualified distribution from a Roth IRA). Similar to the case of a rollover to a designated Roth account, if the entire account balance of a designated Roth account is distributed and some or all of the distribution is rolled over to a Roth IRA, and, at the time of the distribution, the investment in the contract exceeds the balance in the designated Roth account, the investment in the contract in the distributing plan is included in the amount treated as a contribution to the Roth IRA. Certain Amounts Not Qualified Distributions Section 1.402(c)-2, A-4, provides a list of amounts that are not treated as eligible rollover distributions and are instead currently includible in income. These final regulations, like the proposed regulations, provide that these same amounts also cannot be qualified distributions. Distributions described in A-4(a) (distribution of elective deferrals in excess of the section 415 limits),
(b)(corrective distribution of excess deferrals), and
(c)(corrective distribution of excess contributions or excess aggregate contributions), have statutorily specified tax treatments. In the case of a deemed distribution under section 72(p) or the cost of current life insurance protection, an actual amount has not in fact been distributed. In the case of distributions of dividends deductible under section 404(k), section 72(e)(5)(D) and § 1.404(k)-1T provide that these amounts are treated as paid under a separate contract providing only for payment of deductible dividends. However, if a dividend described in section 404(k) has been reinvested in accordance with section 404(k)(2)(iii)(II), then a distribution of the reinvested amount can be a qualified distribution. In response to comments regarding hardship distributions, the final regulations clarify that an amount is not precluded from being a qualified distribution merely because it is described in section 402(c)(4) as an amount not eligible for rollover. Thus, hardship distributions and required minimum distributions are not precluded from being qualified distributions. Similarly, payments in a stream of periodic payments are not precluded from being qualified distributions merely because they are described in section 402(c)(4)(A). Distribution of Employer Securities and NUA The final regulations retain the rules of the proposed regulations relating to the distribution of employer securities and the application of the net unrealized appreciation election of section 402(e)(4). If a qualified distribution includes employer securities, the distribution is not includible in gross income and the basis of each security in the hands of the distributee is the fair market value of the security on the date of the distribution. In such a case, the distributee will receive capital gains treatment at the time of any future disposition of the security, to the extent of any post-distribution appreciation. If a distribution with respect to employer securities is not a qualified distribution, the rules of section 402(e)(4) apply in the same manner as to any other distribution except that the designated Roth account is treated as a separate contract. Some commentators inquired how these rules apply to the portion of a nonqualified distribution that exceeds the basis of the employer stock at the time of the distribution to the extent not includible in gross income as a return of the employee's designated Roth contributions. As explained in Rev. Rul. 74-398, 1974-2 C.B. 136, the basis of the stock at the time of the disposition will be increased to reflect such amount, so that such amount will not be subsequently taxed as appreciation at the time of a subsequent disposition of the stock. Annuity Contracts As noted above, in the *Overview* section of this preamble, these final regulations retain the rule from the proposed regulations that any transaction or accounting methodology involving an employee's designated Roth account and any other accounts under the plan or plans of an employer that has the effect of directly or indirectly transferring value from another account into the designated Roth account violates the separate accounting requirement under section 402A. Commentators asked for additional guidance on how this requirement is satisfied for separate accounts maintained within a single annuity contract, in particular how to allocate charges for guarantees under the contract which apply to the total of all accounts under the contract. The IRS and Treasury Department believe that it may be difficult for a single contract to have combined guarantees that apply to both accounts without the potential for a prohibited transfer of value between the accounts, and have not issued guidance on how to account for these guarantees (including related charges). However, this issue will continue to be considered by the IRS and Treasury Department. Therefore, the regulations authorize the Commissioner to provide additional guidance with respect to separate accounting within an annuity contract. In response to comments, these final regulations clarify that, as previously indicated in § 1.402(c)-2, A-10(a), a distribution of an annuity contract from a designated Roth account is not a distribution event for purposes of section 402 or 402A. Thus, in such case, only distributions from the annuity contract are treated as distributions for those purposes. The determination of whether a distribution is a qualified or nonqualified distribution is made at the time of the distribution from the contract. Reporting and Recordkeeping These final regulations retain the rule of the proposed regulations that the plan administrator or other responsible party with respect to a plan with a designated Roth account is responsible for keeping track of the 5-taxable-year period for each employee and the amount of designated Roth contributions made on behalf of such employee. In addition, the plan administrator or other responsible party of a plan directly rolling over a distribution is required to provide the plan administrator of the recipient plan (that is, the plan accepting the eligible rollover distribution) with a statement indicating either the first year of the 5-taxable-year period for the employee and the portion of such distribution attributable to basis or that the distribution is a qualified distribution. If the distribution is not a direct rollover to a designated Roth account under another eligible plan, the plan administrator or responsible party must provide to the employee, upon request, this same information, except the statement need not indicate the first year of the 5-taxable-year period. The statement is required to be provided within a reasonable period following the direct rollover (or employee request), but in no event later than 30 days following the direct rollover (or employee request), and the plan administrator or other responsible party for the recipient plan is permitted to rely on these statements. If this information is provided on a statement attached to the check issued to the employee, this requirement would be satisfied. As noted in the preamble, to the extent that a portion of a distribution is includible in income (determined without regard to the rollover), if any portion of that distribution is rolled over to a designated Roth account by the distributee rather than by direct rollover, the plan administrator of the recipient plan must notify the IRS of its acceptance of the rollover contribution. The final regulations clarify that this reporting is only required to the extent provided in Forms and Instructions. Such Instructions will specify the address to which the notification must be sent and will require the following information:
(1)The employee's name and social security number;
(2)the amount rolled over;
(3)the year in which the rollover contribution was made; and
(4)such other information as the Commissioner may prescribe in order to determine that the amount rolled over is a valid rollover contribution. Thus, until relevant Forms and Instructions are released, no reporting is required. With respect to other reporting, generally, the same reporting requirements apply to plans with designated Roth accounts as apply to other plans. A contribution to and a distribution from a designated Roth account must be reported on Form W-2 and Form 1099-R, “Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.,” respectively, in accordance with the instructions thereto. An employee has no reporting obligation with respect to designated Roth contributions under a section 401(k) or 403(b) plan. However, an employee rolling over a distribution from a designated Roth account to a Roth IRA should keep track of the amount rolled over in accordance with the instructions to Form 8606, “Nondeductible IRAs.” Designated Roth Contributions as Excess Deferrals Even though designated Roth contributions are not excluded from income when contributed, they are treated as elective deferrals for purposes of section 402(g). Thus, to the extent total elective deferrals for the year exceed the section 402(g) limit for the year, the excess amount can be distributed by April 15th of the year following the year of the excess without adverse tax consequences. However, if such excess deferrals are not distributed by April 15th of the year following the year of the excess, these final regulations, like the proposed regulations, provide that any distribution attributable to an excess deferral that is a designated Roth contribution is includible in gross income (with no exclusion from income for amounts attributable to basis under section 72) and is not eligible for rollover. These regulations provide that if there are any excess deferrals that are designated Roth contributions that are not corrected prior to April 15th of the year following the excess, the first amounts distributed from the designated Roth account are treated as distributions of excess deferrals and earnings until the full amount of those excess deferrals (and attributable earnings) are distributed. Gap Period Income In addition, these final regulations retain the rule in the proposed regulations which reflected the statutory provisions which require that any distribution of excess deferrals include the applicable earnings from the plan. Unlike the existing final regulations under section 402(g), the earnings include income for the period after the taxable year (gap period income). The calculation of gap period income is comparable to the calculation of the gap period income for excess contributions and excess aggregate contributions under the 2004 final regulations under section 401(k) and 401(m). Thus, gap period income must be included in the distribution of excess deferrals to the extent the employee is or would be credited with allocable gain or loss on those excess deferrals for the gap period if the total account were to be distributed. This gap period income rule applies to both pre-tax excess deferrals and designated Roth contributions and continues to apply even after the 2008 elimination of the rule for excess contributions and excess aggregate contributions under section 902(e)(3) of PPA '06. Modifications to Final Roth 401(k) Regulations Some comments received in connection with the proposed regulations raised concerns not about those regulations but rather about the special rules for designated Roth contributions in § 1.401(k)-1(f) that were finalized in TD 9237, published on January 3, 2006 (71 FR 6). In response to those comments these final regulations make two changes to those special rules. First, these regulations clarify and expand the rule in § 1.401(k)-1(f)(3)(ii) to provide that the balance of a participant's designated Roth account and a participant's other accounts under the plan are treated as accounts held under two separate plans (within the meaning of section 414(l)) for purposes of applying not only the special rule in A-11 of § 1.401(a)(31)-1 for *de minimis* distributions (reasonably expected to total less than $200) but also both the automatic rollover rules for mandatory distributions under section 401(a)(31)(B) and the rules in A-9 and A-10 of § 1.401(a)(31)-1 on the extent to which plans must allow split distributions. Thus, for example, if a participant has less than $1,000 in the participant's designated Roth account and less than $1,000 in the participant's other accounts, the plan will not need to provide the participant with an automatic rollover with respect to the designated Roth account or the other accounts even if the total accrued benefit of the participant under the plan exceeds $1,000. Second, in response to comments about compensation provided to certain foreign missionaries, the regulations are modified to require that an employer treat designated Roth contribution as not excludible from gross income as elective deferrals rather than treated as includible in gross income. As a result, if section 72(f)(2) applies to a contribution, an employee will have basis as a result of the contribution to the extent that contribution would have been excludible from gross income even if paid directly to the employee and such amount can be treated as a designated Roth contribution even though such amount is income that is not includible in taxable income. Thus, compensation for foreign missionaries is not precluded from being contributed to a designated Roth account merely because the compensation would not have been includible in gross income if paid directly. Finally, the regulations clarify that, for self-employed individuals, the requirement that a designated Roth contribution not be excludible from gross income as an elective deferral for being a designated Roth contribution is only satisfied if the self-employed individual does not claim a deduction for the contribution. Commentators inquired as to whether catch-up contributions may be designated Roth contributions. Catch-up contributions are treated the same as any other elective deferrals and, thus, a participant's catch-up contributions may either be pre-tax elective deferrals or designated Roth contributions. Finally, these final regulations revise the special rules for designated Roth contributions in § 1.401(k)-1(f) to reflect the repeal in PPA '06 of the sunset of the provisions relating to designated Roth contributions. Effective Date Section 402A applies to employees' taxable years beginning on or after January 1, 2006. These final regulations under section 402A are generally applicable for taxable years beginning on or after January 1, 2007. However, certain provisions in these final regulations under section 402A are applicable at the same time as section 402A. These include the clarification that the separate accounting requirement does not permit any transaction or accounting methodology that transfers value between designated Roth accounts and other accounts under a plan and the rules relating to rollovers to designated Roth accounts and Roth IRAs. Similarly, these final regulations under section 408A are applicable at the same time as section 402A. These final regulations also address the treatment of rollover contributions to Roth IRAs and designated Roth accounts. The final regulations under section 402(g) relating to designated Roth contributions also are applicable at the same time as section 402A. Thus, these final regulations are applicable for excess deferrals for taxable years beginning on or after January 1, 2006. However, unlike the proposed regulations, the rule in these final regulations requiring distribution of gap period income on excess deferrals applies to excess deferrals for taxable years beginning on or after 2007, which are generally distributed on or after January 1, 2008. Special Analyses It has been determined that these final regulations are not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It has also been determined that 5 U.S.C. 553(b) does not apply to these regulations. It is hereby certified that the collection of information in these regulations will not have a significant economic impact on a substantial number of small entities. This certification is based on the fact that most small entities that will maintain a designated Roth account already use a third party provider to administer the plan and the collection of information in these regulations, which is required to comply with the separate accounting and recordkeeping requirements of section 402A(b), will only minimally increase the third party provider's administrative burden with respect to the plan. Therefore, an analysis under the Regulatory Flexibility Act (5 U.S.C. chapter 6) is not required. Pursuant to section 7805(f) of the Code, the proposed regulations preceding these final regulations were submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small business. Drafting Information The principal authors of these regulations are R. Lisa Mojiri-Azad, Bill Gibbs and Cathy Vohs, Office of Division Counsel/Associate Chief Counsel (Tax Exempt and Government Entities). However, other personnel from the IRS and Treasury Department participated in the development of these regulations. List of Subjects in 26 CFR Part 1 Income taxes, Reporting and recordkeeping requirements. Adoption of Amendments to the Regulations Accordingly, 26 CFR part 1 is amended as follows: PART 1—INCOME TAXES **Paragraph 1.** The authority citation for part 1 is amended by adding an entry in numerical order to read in part as follows: Authority: 26 U.S.C. 7805 * * * Section 1.402A-1 is also issued under 26 U.S.C. 402A * * * **Par. 2.** Section 1.401(k)-0 is amended as follows: 1. The entries for 1.401(k)-1(f)(2), (3),
(4)and
(5)are revised. 2. The entry for 1.401(k)-1(f)(6) is added. § 1.401(k)-0 Table of contents. § 1.401(k)-1 Certain cash or deferred arrangements.
(f)* * *
(1)In general.
(2)Inclusion treatment.
(3)Separate accounting required.
(4)Designated Roth contributions must satisfy rules applicable to elective contributions.
(i)In general.
(ii)Special rules for direct rollovers.
(5)Rules regarding designated Roth contribution elections.
(i)Frequency of elections.
(ii)Default elections.
(6)Effective date. **Par. 3.** Section 1.401(k)-1(f) is amended as follows: 1. Revise paragraph (f)(1)(ii) and (iii). 2. Redesignate paragraphs (f)(2) through
(5)as (f)(3) through (6). 3. Add a new paragraph (f)(2). 4. Revise the first sentence of newly redesignated paragraph (f)(3) and add a sentence at the end. 5. Revise the last sentence of newly redesignated paragraph (f)(4)(ii). 6. Revise newly redesignated paragraph (f)(6). The addition and revision to § 1.401(k)-1 read as follows: § 1.401(k)-1 Certain cash or deferred arrangements.
(f)Special rules for designated Roth contributions.
(1)* * *
(ii)Treated by the employer as not excludible from the employee's gross income (in accordance with paragraph (f)(2) of this section);
(iii)Maintained by the plan in a separate account (in accordance with paragraph (f)(3) of this section).
(2)*Inclusion treatment.* An elective contribution is generally treated as not excludible from gross income if it is treated as includible in gross income by the employer (e.g., by treating the contribution as wages subject to applicable income tax withholding). However, in the case of a self-employed individual, an elective contribution is treated as not excludible from gross income only if the individual does not claim a deduction for such amount. If an elective contribution would not have been includible in gross income if the amount had been paid directly to the employee (rather than being subject to a cash or deferral election), the elective contribution is nevertheless permitted to be a designated Roth contribution, provided the employee is entitled to treat the amount as an investment in the contract pursuant to section 72(f)(2).
(3)*Separate accounting required.* Under the separate accounting requirement of this paragraph (f)(3), contributions and withdrawals of designated Roth contributions must be credited and debited to a designated Roth account maintained for the employee and the plan must maintain a record of the employee's investment in the contract (that is, designated Roth contributions that have not been distributed) with respect to the employee's designated Roth account. * * * See A-13 of § 1.402A-1 for additional requirements for separate accounting.
(4)* * *
(ii)* * * Moreover, a participant's designated Roth account and the participant's other accounts under a plan are treated as accounts held under two separate plans (within the meaning of section 414(l)) for purposes of applying the automatic rollover rules for mandatory distributions under section 401(a)(31)(B)(i)(I) and the special rules in A-9 through A-11 of § 1.401(a)(31)-1.
(6)*Effective date.* Section 402A and the provisions of this section 1.401(k)-1(f) apply to taxable years beginning after December 31, 2005. **Par. 4.** Section 1.402(g)-1 is amended as follows: 1. Revise the second sentence and add a third sentence to paragraph (a). 2. Add new paragraphs (b)(5) and (b)(6). 3. Revise paragraph (d). 4. Revise paragraph (e)(2) introductory text. 5. Revise paragraph (e)(2)(i). 6. Revise the second sentence and add a new third sentence in paragraph (e)(3)(i)(A). 7. Revise paragraph (e)(5)(i). 8. Add a sentence after the last sentence in paragraph (e)(5)(ii). 9. Revise paragraph (e)(5)(iii). 10. Add paragraph (e)(5)(v). 11. Add paragraph (e)(8)(iv). The additions and revisions to § 1.402(g)-1 read as follows: § 1.402(g)-1 Limitation on exclusion for elective deferrals.
(a)*In general.* * * * Thus, an individual's elective deferrals in excess of the applicable limit for a taxable year (that is, the individual's excess deferrals for the year) must be included in gross income for the year, except to the extent the excess deferrals are comprised of designated Roth contributions, and thus, are already includible in gross income. A designated Roth contribution is treated as an excess deferral only to the extent that the total amount of designated Roth contributions for an individual exceeds the applicable limit for the taxable year or the designated Roth contributions are identified as excess deferrals and the individual receives a distribution of the excess deferrals and allocable income under paragraph (e)(2) or (e)(3) of this section.
(b)* * *
(5)Any designated Roth contributions described in section 402A (before applying the limits of section 402(g) or this section).
(6)Any elective employer contributions to a SIMPLE retirement account, on behalf of an employee pursuant to a qualified salary reduction arrangement as described in section 408(p)(2) (before applying the limits of section 402(g) or this section).
(d)*Applicable limit* —(1) *In general.* Except as provided under paragraph (d)(2) of this section, the applicable limit for an individual's taxable year is the applicable dollar amount set forth in section 402(g)(1)(B). This applicable dollar amount is increased for the taxable year beginning in 2007 and later years in the same manner as the dollar amount under section 415(b)(1)(A) is adjusted pursuant to section 415(d). See § 1.402(g)-2 for the treatment of catch-up contributions described in section 414(v).
(2)*Special adjustment for elective deferrals with respect to section 403(b) annuity contracts for certain long-term employees.* The applicable limit for an individual who is a qualified employee (as defined in section 402(g)(7)(C)) and has elective deferrals described in paragraph (b)(3) or
(5)of this section for a taxable year is adjusted by increasing the applicable limit otherwise determined under paragraph (d)(1) of this section in accordance with section 402(g)(7).
(e)* * *
(2)*Correction of excess deferrals after the taxable year.* A plan may provide that if any amount is an excess deferral under paragraph
(a)of this section:
(i)Not later than the first April 15 (or such earlier date specified in the plan) following the close of the individual's taxable year, the individual may notify each plan under which elective deferrals were made of the amount of the excess deferrals received by the plan. If any designated Roth contributions were made to a plan, the notification must also identify the extent, if any, to which the excess deferrals are comprised of designated Roth contributions. A plan may provide that an individual is deemed to have notified the plan of excess deferrals (including the portion of excess deferrals that are comprised of designated Roth contributions) to the extent the individual has excess deferrals for the taxable year calculated by taking into account only elective deferrals under the plan and other plans of the same employer and the plan may provide the extent to which such excess deferrals are comprised of designated Roth contributions. A plan may instead provide that the employer may notify the plan on behalf of the individual under these circumstances.
(3)* * *
(i)* * *
(A)* * * If any designated Roth contributions were made to a plan, the notification must identify the extent to which, if any, the excess deferrals are comprised of designated Roth contributions. A plan may provide that an individual is deemed to have notified the plan of excess deferrals (including the portion of excess deferrals that are comprised of designated Roth contributions) for the taxable year calculated by taking into account only elective deferrals under the plan and other plans of the same employer and the plan may provide the extent to which such excess deferrals are comprised of designated Roth contributions. * * *
(5)*Income allocable to excess deferrals* —(i) *General rule.* The income allocable to excess deferrals for a taxable year that begins on or after January 1, 2007 is equal to the sum of the allocable gain or loss for the taxable year of the individual and, to the extent the excess deferrals are or will be credited with gain or loss for the period after the close of the taxable year and prior to the distribution (the gap period) if the total account were to be distributed, the allocable gain or loss during that period. The income allocable to excess deferrals for a taxable year that begins before 2007 is determined using the 1.402(g)-1(e)(5) (as it appeared in the April 1, 2006 edition of 26 CFR Part 1).
(ii)*Method of allocating income.* * * * A plan will not fail to use a reasonable method for computing the income allocable to excess deferrals merely because the income allocable to excess deferrals is determined on a date that is no more than 7 days before the distribution.
(iii)*Alternative method of allocating taxable year income.* A plan may determine the income allocable to excess deferrals for the taxable year by multiplying the income for the taxable year allocable to elective deferrals by a fraction. The numerator of the fraction is the excess deferrals by the employee for the taxable year. The denominator of the fraction is equal to the sum of:
(A)The total account balance of the employee attributable to elective deferrals as of the beginning of the taxable year, plus
(B)The employee's elective deferrals for the taxable year.
(v)*Alternative method for allocating taxable year and gap period income.* A plan may determine the allocable gain or loss for the aggregate of the taxable year and the gap period by applying the alternative method provided by paragraph (e)(5)(iii) of this section to this aggregate period. This is accomplished by substituting the income for the taxable year and the gap period for the income for the taxable year and by substituting the elective deferrals for the taxable year and the gap period for the elective deferrals for the taxable year in determining the fraction that is multiplied by that income.
(8)* * *
(iv)*Distributions of excess deferrals from a designated Roth account.* The rules of paragraph (e)(8)(iii) of this section generally apply to distributions of excess deferrals that are designated Roth contributions and the attributable income. Thus, if a designated Roth account described in section 402A includes any excess deferrals, any distribution of amounts attributable to those excess deferrals are includible in gross income (without adjustment for any return of investment in the contract under section 72(e)(8)). In addition, such distributions cannot be qualified distributions described in section 402A(d)(2) and are not eligible rollover distributions within the meaning of section 402(c)(4). For this purpose, if a designated Roth account includes any excess deferrals, any distributions from the account are treated as attributable to those excess deferrals until the total amount distributed from the designated Roth account equals the total of such deferrals and attributable income. **Par. 5.** Sections 1.402A-1 and 1.402A-2 are added to read as follows: § 1.402A-1 Designated Roth Accounts. Q-1. What is a designated Roth account? A-1. A designated Roth account is a separate account under a qualified cash or deferred arrangement under a section 401(a) plan, or under a section 403(b) plan, to which designated Roth contributions are permitted to be made in lieu of elective contributions, that satisfies the requirements of § 1.401(k)-1(f) (in the case of a section 401(a) plan). Q-2. How is a distribution from a designated Roth account taxed? A-2.
(a)The taxation of a distribution from a designated Roth account depends on whether or not the distribution is a qualified distribution. A qualified distribution from a designated Roth account is not includible in the distributee's gross income.
(b)Except as otherwise provided in paragraph
(c)of this A-2, a qualified distribution is a distribution that is both—
(1)Made after the 5-taxable-year period of participation defined in A-4 of this section has been completed; and
(2)Made on or after the date the employee attains age 59 1/2 , made to a beneficiary or the estate of the employee on or after the employee's death, or attributable to the employee's being disabled within the meaning of section 72(m)(7).
(c)A distribution from a designated Roth account is not a qualified distribution to the extent it consists of a distribution of excess deferrals and attributable income described in § 1.402(g)-1(e). See A-11 of this section for other amounts that are not treated as qualified distributions, including excess contributions described in section 401(k)(8), and excess aggregate contributions described in section 401(m)(8), and income, on any of these excess amounts. Q-3. How is a distribution from a designated Roth account taxed if it is not a qualified distribution? A-3. Except as provided in A-11 of this section, a distribution from a designated Roth account that is not a qualified distribution is taxable to the distributee under section 402 in the case of a plan qualified under section 401(a) and under section 403(b)(1) in the case of a section 403(b) plan. For this purpose, a designated Roth account is treated as a separate contract under section 72. Thus, except as otherwise provided in A-5 of this section for a rollover, if a distribution is before the annuity starting date, the portion of any distribution that is includible in gross income as an amount allocable to income on the contract and the portion not includible in gross income as an amount allocable to investment in the contract is determined under section 72(e)(8), treating the designated Roth account as a separate contract. Similarly, in the case of any amount received as an annuity, if a distribution is on or after the annuity starting date, the portion of any annuity payment that is includible in gross income as an amount allocable to income on the contract and the portion not includible in gross income as an amount allocable to investment in the contract is determined under section 72(b) or (d), as applicable, treating the designated Roth account as a separate contract. For purposes of section 72, designated Roth contributions are described in section 72(f)(1) or 72(f)(2), to the extent applicable. Q-4. What is the 5-taxable-year period of participation described in A-2 of this section? A-4.
(a)The 5-taxable-year period of participation described in A-2 of this section for a plan is the period of 5 consecutive taxable years that begins with the first day of the first taxable year in which the employee makes a designated Roth contribution to any designated Roth account established for the employee under the same plan and ends when 5 consecutive taxable years have been completed. For this purpose, the first taxable year in which an employee makes a designated Roth contribution is the year in which the amount is includible in the employee's gross income. Notwithstanding the preceding, however, a contribution that is returned as an excess deferral or excess contribution does not begin the 5 taxable-year period of participation. Similarly, a contribution returned as a permissible withdrawal under section 414(w) does not begin the 5 taxable-year period of participation.
(b)Generally, an employee's 5-taxable-year period of participation is determined separately for each plan (within the meaning of section 414(l)) in which the employee participates. Thus, if an employee has elective deferrals made to designated Roth accounts under two or more plans, the employee may have two or more different 5-taxable-year periods of participation, depending on when the employee first had contributions made to a designated Roth account under each plan. However, if a direct rollover contribution of a distribution from a designated Roth account under another plan is made by the employee to the plan, the 5-taxable-year period of participation begins on the first day of the employee's taxable year in which the employee first had designated Roth contributions made to such other designated Roth account, if earlier than the first taxable year in which a designated Roth contribution is made to the plan. See A-5(c) of this section for additional rules on determining the start of the 5-taxable-year of participation in the case of an indirect rollover.
(c)The beginning of the 5-taxable-year period of participation is not redetermined for any portion of an employee's designated Roth account. This is true even if the entire designated Roth account is distributed during the 5-taxable-year period of participation and the employee subsequently makes additional designated Roth contributions under the plan.
(d)The rule in paragraph
(c)of this section applies if the employee dies or the account is divided pursuant to a qualified domestic relations order (QDRO), and thus, a portion of the account is not payable to the employee and is payable to the employee's beneficiary or an alternate payee. In the case of distribution to an alternate payee or beneficiary, generally, the age, death, or disability of the employee is used to determine whether the distribution to an alternate payee or beneficiary is qualified. However, if an alternate payee or a spousal beneficiary rolls the distribution into a designated Roth account in a plan maintained by his or her own employer, such individual's age, disability, or death is used to determine whether a distribution from the recipient plan is qualified. In addition, if the rollover is a direct rollover contribution to the alternate payee's or spousal beneficiary's own designated Roth account, the 5-taxable-year period of participation under the recipient plan begins on the earlier of the date the employee's 5-taxable-year period of participation began under the distributing plan or the date the 5-taxable-year period of participation applicable to the alternate payee's or spousal beneficiary's designated Roth account began under the recipient plan.
(e)If a designated Roth contribution is made by a reemployed veteran for a year of qualified military service pursuant to section 414(u) that is before the year in which the contribution is actually made, the contribution is treated as having been made in the year of qualified military service to which the contribution relates, as designated by the reemployed veteran. Reemployed veterans may identify the year of qualified military service for which a contribution is made for other purposes, such as for entitlement to a match, and the treatment for the 5-taxable-year period of participation rule follows that identification. In the absence of such designation, for purposes of determining the first year of the five years of participation under section 402A(d)(2)(B), the contribution is treated as relating to the first year of qualified military service for which the reemployed veteran could have made designated Roth contributions under the plan, or if later the first taxable year in which designated Roth contributions could be made under the plan. Q-5. How do the taxation rules apply to a distribution from a designated Roth account that is rolled over? A-5.
(a)An eligible rollover distribution from a designated Roth account is permitted to be rolled over into another designated Roth account or a Roth IRA, and the amount rolled over is not currently includible in gross income. In accordance with section 402(c)(2), to the extent that a portion of a distribution from a designated Roth account is not includible in income (determined without regard to the rollover), if that portion of the distribution is to be rolled over into a designated Roth account, the rollover must be accomplished through a direct rollover (i.e., a 60-day rollover to another designated Roth account is not available for this portion of the distribution). For this purpose, any amount paid in a direct rollover is treated as a separate distribution from any amount paid directly to the employee. If a distribution from a designated Roth account is instead made to the employee, the employee would still be able to roll over the entire amount (or any portion thereof) into a Roth IRA within the 60-day period described in section 402(c)(3).
(b)In the case of an eligible rollover distribution from a designated Roth account that is not a qualified distribution and not paid as a direct rollover contribution, if less than the entire amount of the distribution is rolled over, the part that is rolled over is deemed to consist first of the portion of the distribution that is attributable to income under section 72(e)(8).
(c)If an employee receives a distribution from a designated Roth account, the portion of the distribution that would be includible in gross income is permitted to be rolled over into a designated Roth account under another plan. In such a case, § 1.402A-2, A-3, provides for additional reporting by the recipient plan. In addition, the employee's period of participation under the distributing plan is not carried over to the recipient plan for purposes of satisfying the 5-taxable-year period of participation requirement under the recipient plan. Generally, the taxable year in which the recipient plan accepts such rollover contribution is the taxable year that begins the participant's new 5-taxable-year period of participation. However, if the participant is rolling over to a plan in which the participant already has a pre-existing designated Roth account with a longer period of participation, the starting date of the recipient account is used to measure the participant's 5-taxable-year period of participation.
(d)The following example illustrates the application of this A-5: Example. Employee B receives a $14,000 eligible rollover distribution that is not a qualified distribution from B's designated Roth account, consisting of $11,000 of investment in the contract and $3,000 of income. Within 60 days of receipt, Employee B rolls over $7,000 of the distribution into a Roth IRA. The $7,000 is deemed to consist of $3,000 of income and $4,000 of investment in the contract. Because the only portion of the distribution that could be includible in gross income (the income) is rolled over, none of the distribution is includible in Employee B's gross income.
(e)This A-5 applies for taxable years beginning on or after January 1, 2006. Q-6. In the case of a rollover contribution to a designated Roth account, how is the amount that is treated as investment in the contract under section 72 determined? A-6.
(a)If a distribution from a designated Roth account is rolled over to another designated Roth account in a direct rollover, the amount of the rollover contribution allocated to investment in the contract in the recipient designated Roth account is the amount that would not have been includible in gross income (determined without regard to section 402(e)(4)) if the distribution had not been rolled over. Thus, if an amount that is a qualified distribution is rolled over, the entire amount of the rollover contribution is allocated to investment in the contract.
(b)If the entire account balance of a designated Roth account is rolled over to another designated Roth account in a direct rollover, and, at the time of the distribution, the investment in the contract exceeds the balance in the designated Roth account, the investment in the contract in the distributing plan is included in the investment in the contract of the recipient plan. Q-7. After a qualified distribution from a designated Roth account has been made, how is the remaining investment in the contract of the designated Roth account determined under section 72? A-7.
(a)The portion of any qualified distribution that is treated as a recovery of investment in the contract is determined in the same manner as if the distribution were not a qualified distribution. (See A-3 of this section) Thus, the remaining investment in the contract in a designated Roth account after a qualified distribution is determined in the same manner after a qualified distribution as it would be determined if the distribution were not a qualified distribution.
(b)The following example illustrates the application of this A-7: Example. Employee C receives a $12,000 distribution, which is a qualified distribution that is attributable to the employee being disabled within the meaning of section 72(m)(7), from C's designated Roth account. Immediately prior to the distribution, the account consisted of $21,850 of investment in the contract (i.e., designated Roth contributions) and $1,150 of income. For purposes of determining recovery of investment in the contract under section 72, the distribution is deemed to consist of $11,400 of investment in the contract [$12,000 × 21,850/(1,150 + 21,850)], and $600 of income [$12,000 × 1,150/(1,150 + 21,850)]. Immediately after the distribution, C's designated Roth account consists of $10,450 of investment in the contract and $550 of income. This determination of the remaining investment in the contract will be needed if C subsequently is no longer disabled and takes a nonqualified distribution from the designated Roth account. Q-8. What is the relationship between the accounting for designated Roth contributions as investment in the contract for purposes of section 72 and their treatment as elective deferrals available for a hardship distribution under section 401(k)(2)(B)? A-8.
(a)There is no relationship between the accounting for designated Roth contributions as investment in the contract for purposes of section 72 and their treatment as elective deferrals available for a hardship distribution under section 401(k)(2)(B). A plan that makes a hardship distribution under section 401(k)(2)(B) from elective deferrals that includes designated Roth contributions must separately determine the amount of elective deferrals available for hardship and the amount of investment in the contract attributable to designated Roth contributions for purposes of section 72. Thus, the entire amount of a hardship distribution is treated as reducing the otherwise maximum distributable amount for purposes of applying the rule in section 401(k)(2)(B) and § 1.401(k)-1(d)(3)(ii) that generally limits hardship distributions to the principal amount of elective deferrals made less the amount of elective deferrals previously distributed from the plan, even if a portion of the distribution is treated as income under section 72(e)(8).
(b)The following example illustrates the application of this A-8: Example. The facts as in the *Example* in A-7 of this section, except that instead of being disabled, Employee C is receiving a hardship distribution. In addition, Employee C has made elective deferrals that are not designated Roth contributions totaling $20,000 and has received no previous distributions of elective deferrals from the plan. The adjustment to the investment in the contract is the same as in A-7 of this section, but for purposes of determining the amount of elective deferrals available for future hardship distribution, the entire amount of the distribution is subtracted from the maximum distributable amount. Thus, Employee C has only $29,850 ($41,850−$12,000) available for hardship distribution from C's designated Roth account. Q-9. Can an employee have more than one separate contract for designated Roth contributions under a plan qualified under section 401(a) or a section 403(b) plan? A-9.
(a)Except as otherwise provided in paragraph
(b)of this A-9, for purposes of section 72, there is only one separate contract for an employee with respect to the designated Roth contributions under a plan. Thus, if a plan maintains one separate account for designated Roth contributions made under the plan and another separate account for rollover contributions received from a designated Roth account under another plan (so that the rollover account is not required to be subject to the distribution restrictions otherwise applicable to the account consisting of designated Roth contributions made under the plan), both separate accounts are considered to be one contract for purposes of applying section 72 to the distributions from either account.
(b)If a separate account with respect to an employee's accrued benefit consisting of designated Roth contributions is established and maintained for an alternate payee pursuant to a qualified domestic relations order and another designated Roth account is maintained for the employee, each account is treated as a separate contract for purposes of section 72. The alternate payee's designated Roth account is also a separate contract for purposes of section 72 with respect to any other account maintained for that alternate payee. Similarly, if separate accounts are established and maintained for different beneficiaries after the death of an employee, the separate account for each beneficiary is treated as a separate contract under section 72 and is also a separate contract with respect to any other account maintained for that beneficiary under the plan that is not a designated Roth account. When the separate account is established for an alternate payee or for a beneficiary (after an employee's death), each separate account must receive a proportionate amount attributable to investment in the contract. Q-10. What is the tax treatment of employer securities distributed from a designated Roth account? A-10.
(a)If a distribution of employer securities from a designated Roth account is not a qualified distribution, section 402(e)(4)(B) applies. Thus, in the case of a lump-sum distribution that includes employer securities, unless the taxpayer elects otherwise, net unrealized appreciation attributable to the employer securities is not includible in gross income; and such net unrealized appreciation is not included in the basis of the distributed securities and is capital gain to the extent such appreciation is realized in a subsequent taxable transaction.
(b)In the case of a qualified distribution of employer securities from a designated Roth account, the distributee's basis in the distributed securities for purposes of subsequent disposition is their fair market value at the time of distribution. Q-11. Can an amount described in A-4 of § 1.402(c)-2 with respect to a designated Roth account be a qualified distribution? A-11. No. An amount described in A-4 of § 1.402(c)-2 with respect to a designated Roth account cannot be a qualified distribution. Such an amount is taxable under the rules of §§ 1.72-16(b), 1.72(p)-1, A-11 through A-13, 1.402(g)-1(e)(8), 1.401(k)-2(b)(2)(vi), 1.401(m)-2(b)(2)(vi), or 1.404(k)-1T. Thus, for example, loans that are treated as deemed distributions pursuant to section 72(p), or dividends paid on employer securities as described in section 404(k) are not qualified distributions even if the deemed distributions occur or the dividends are paid after the employee attains age 59 1/2 and the 5-taxable-year period of participation defined in A-4 of this section has been satisfied. However, if a dividend is reinvested in accordance with section 404(k)(2)(A)(iii)(II), the amount of such a dividend is not precluded from being a qualified distribution if later distributed. Further, an amount is not precluded from being a qualified distribution merely because it is described in section 402(c)(4) as an amount not eligible for rollover. Thus, a hardship distribution is not precluded from being a qualified distribution. Q-12. If any amount from a designated Roth account is included in a loan to an employee, do the plan aggregation rules of section 72(p)(2)(D) apply for purposes of determining the total amount an employee is permitted to borrow from the plan, even though the designated Roth account generally is treated as a separate contract under section 72? A-12. Yes. If any amount from a designated Roth account is included in a loan to an employee, notwithstanding the general rule that the designated Roth account is treated as a separate contract under section 72, the plan aggregation rules of section 72(p)(2)(D) apply for purposes of determining the maximum amount the employee is permitted to borrow from the plan and such amount is based on the total of the designated Roth contribution amounts and the other amounts under the plan. To the extent a loan is from a designated Roth account, the repayment requirement of section 72(p)(2)(C) must be satisfied separately with respect to that portion of the loan and with respect to the portion of the loan from other accounts under the plan. Q-13. Does a transaction or accounting methodology involving an employee's designated Roth account and any other accounts under the plan or plans of an employer that has the effect of transferring value from the other accounts into the designated Roth account violate the separate accounting requirement of section 402A? A-13.
(a)Yes. Any transaction or accounting methodology involving an employee's designated Roth account and any other accounts under the plan or plans of an employer that has the effect of directly or indirectly transferring value from another account into the designated Roth account violates the separate accounting requirement under section 402A. However, any transaction that merely exchanges investments between accounts at fair market value will not violate the separate accounting requirement.
(b)In the case of an annuity contract which contains both a designated Roth account and any other accounts, the Commissioner may prescribe additional guidance of general applicability, published in the Internal Revenue Bulletin (see 601.601(d)(2) of this chapter), to provide additional rules for allocation of income, expenses, gains and losses among the accounts under the contract.
(c)This A-13 applies to designated Roth accounts for taxable years beginning on or after January 1, 2006. Q-14. How is an annuity contract that is distributed from a designated Roth account treated for purposes of section 402A? A-14. A qualified plan distributed annuity contract within the meaning of § 1.402(c)-2, A-10(a) that is distributed from a designated Roth account is not treated as a distribution for purposes of section 402 or 402A. Instead, the amounts paid under the annuity contract are treated as distributions for purposes of sections 402 and 402A. Thus, the period after the annuity contract is distributed and before a payment from the annuity contract is made is included in determining whether the five-year period of participation is satisfied. Further, for purposes of determining if a distribution is a qualified distribution, the determination of whether a distribution is made on or after the date the employee attains age 59 1/2 , made to a beneficiary or the estate of the employee on or after the employee's death, or attributable to the employee's being disabled within the meaning of section 72(m)(7) is made based on the facts at the time the distribution is made from the annuity contract. Thus for example, if an employee first makes a designated Roth contribution to a designated Roth account in 2006 at age 56, receives a distributed annuity contract within the meaning of § 1.402(c)-2, A-10(a) in 2007 purchased only with assets from the designated Roth account, and then receives a distribution from the contract in 2011 at age 60, the distribution is a qualified distribution. Q-15. When are section 402A and this § 1.402A-1 applicable? A-15. Section 402A is applicable for taxable years beginning on or after January 1, 2006. Except as otherwise provided in A-5 and A-13 of this section, the rules of this § 1.402A-1 apply for taxable years beginning on or after January 1, 2007. § 1.402A-2 Reporting and recordkeeping requirements with respect to designated Roth accounts. Q-1. Who is responsible for keeping track of the 5-taxable-year period of participation and the investment in the contract, i.e., the amount of unrecovered designated Roth contributions for the employee? A-1. The plan administrator or other responsible party with respect to a plan with a designated Roth account is responsible for keeping track of the 5-taxable-year period of participation for each employee and the amount of investment in the contract (unrecovered designated Roth contributions) on behalf of such employee. For purposes of the preceding sentence, in the absence of actual knowledge to the contrary, the plan administrator or other responsible party is permitted to assume that an employee's taxable year is the calendar year. In the case of a direct rollover from another designated Roth account, the plan administrator or other responsible party of the recipient plan can rely on reasonable representations made by the plan administrator or responsible party with respect to the plan with the other designated Roth account. See A-2 of this section for statements required in the case of rollovers. Q-2. In the case of an eligible rollover distribution from a designated Roth account, what additional information must be provided with respect to such distribution? A-2.
(a)Pursuant to section 6047(f), if an amount is distributed from a designated Roth account, the plan administrator or other responsible party with respect to the plan must provide a statement as described below in the following situations—
(1)In the case of a direct rollover of a distribution from a designated Roth account under a plan to a designated Roth account under another plan, the plan administrator or other responsible party must provide to the plan administrator or responsible party of the recipient plan either a statement indicating the first year of the 5-taxable-year period described in A-1 of this section and the portion of the distribution that is attributable to investment in the contract under section 72, or a statement that the distribution is a qualified distribution.
(2)If the distribution is not a direct rollover to a designated Roth account under another plan, the plan administrator or responsible party must provide to the employee, upon request, the same information described in paragraph (a)(1) of this A-2, except the statement need not indicate the first year of the 5-taxable-year period described in A-1 of the section.
(b)The statement described in paragraph
(a)of this A-2 must be provided within a reasonable period following the direct rollover or distributee request but in no event later than 30 days following the direct rollover or distributee request. Q-3. If a plan qualified under section 401(a) or a section 403(b) plan accepts a 60-day rollover of earnings from a designated Roth account, what report to the IRS must be provided with respect to such rollover contribution? A-3. To the extent required in Forms and Instructions, if a plan qualified under section 401(a), or a section 403(b) plan, accepts a rollover contribution (other than a direct rollover contribution) under section 402(c)(2), or section 403(b)(8)(B), of the portion of a distribution from a designated Roth account that would have been includable in gross income, the plan administrator or other responsible party for the recipient plan must notify the Commissioner of its acceptance of the rollover contribution no later than the due date for filing Form 1099-R, “ Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.,.” The Forms and Instructions will specify the address to which the notification is required to be sent and will require inclusion of the employee's name and social security number, the amount rolled over, the year in which the rollover contribution was made, and such other information as the Commissioner may prescribe in order to determine that the amount rolled over is a valid rollover contribution. Q-4. When is this § 1.402A-2 applicable? A-4. The rules of this § 1.402A-2 are applicable for taxable years beginning on or after January 1, 2007. **Par. 6.** Section 1.408A-10 is added to read as follows: § 1.408A-10 Coordination between designated Roth accounts and Roth IRAs. Q-1. Can an eligible rollover distribution, within the meaning of section 402(c)(4), from a designated Roth account, as defined in A-1 of § 1.402A-1, be rolled over to a Roth IRA? A-1. Yes. An eligible rollover distribution, within the meaning of section 402(c)(4), from a designated Roth account may be rolled over to a Roth IRA. For purposes of this section, a designated Roth account means a designated Roth account as defined in A-1 of § 1.402A-1. Q-2. Can an eligible rollover distribution from a designated Roth account be rolled over to a Roth IRA even if the distributee is not otherwise eligible to make regular or conversion contributions to a Roth IRA? A-2. Yes. An individual may establish a Roth IRA and roll over an eligible rollover distribution from a designated Roth account to that Roth IRA even if such individual is not eligible to make regular contributions or conversion contributions (as described in section 408A(c)(2) and (d)(3), respectively) because of the modified adjusted gross income limits in section 408A(b)(3). Q-3. For purposes of the ordering rules on distributions from Roth IRAs, what portion of a distribution from a rollover contribution from a designated Roth account is treated as contributions? A-3.
(a)Under section 408A(d)(4), distributions from Roth IRAs are deemed to consist first of regular contributions, then of conversion contributions, and finally, of earnings. For purposes of section 408A(d)(4), the amount of a rollover contribution that is treated as a regular contribution is the portion of the distribution that is treated as investment in the contract under A-6 of § 1.402A-1, and the remainder of the rollover contribution is treated as earnings. Thus, the entire amount of any qualified distribution from a designated Roth account that is rolled over into a Roth IRA is treated as a regular contribution to the Roth IRA. Accordingly, a subsequent distribution from the Roth IRA in the amount of that rollover contribution is not includible in gross income under the rules of A-8 of § 1.408A-6.
(b)If the entire account balance of a designated Roth account is distributed to an employee and only a portion of the distribution is rolled over to a Roth IRA within the 60-day period described in section 402(c)(3), and at the time of the distribution, the investment in the contract exceeds the balance in the designated Roth account, the portion of investment in the contract that exceeds the amount used to determine the taxable amount of the distribution is treated as a regular contribution for purposes of section 408A(d)(4). Q-4. In the case of a rollover from a designated Roth account to a Roth IRA, when does the 5-taxable-year period (described in section 408A(d)(2)(B) and A-1 of § 1.408A-6) for determining qualified distributions from a Roth IRA begin? A-4.
(a)The 5-taxable-year period for determining a qualified distribution from a Roth IRA (described in section 408A(d)(2)(B) and A-1 of § 1.408A-6) begins with the earlier of the taxable year described in A-2 of § 1.408A-6 or the taxable year in which a rollover contribution from a designated Roth account is made to a Roth IRA. The 5-taxable-year period described in this A-4 and the 5-taxable-year period of participation described in A-4 of § 1.402A-1 are determined independently.
(b)The following examples illustrate the application of this A-4: Example 1. Employee D began making designated Roth contributions under his employer's 401(k) plan in 2006. Employee D, who is over age 59 1/2 , takes a distribution from D's designated Roth account in 2008, prior to the end of the 5-taxable-year period of participation used to determine qualified distributions from a designated Roth account. The distribution is an eligible rollover distribution and D rolls it over in accordance with sections 402(c) and 402A(c)(3) to D's Roth IRA, which was established in 2003. Any subsequent distribution from the Roth IRA of the amount rolled in, plus earnings thereon, would not be includible in gross income (because it would be a qualified distribution within the meaning of section 408A(d)(2)). Example 2. The facts are the same as in *Example 1* , except that the Roth IRA is D's first Roth IRA and is established with the rollover in 2008, which is the only contribution made to the Roth IRA. If a distribution is made from the Roth IRA prior to the end of the 5-taxable-year period used to determine qualified distributions from a Roth IRA (which begins in 2008, the year of the rollover which established the Roth IRA) the distribution would not be a qualified distribution within the meaning of section 408A(d)(2), and any amount of the distribution that exceeded the portion of the rollover contribution that consisted of investment in the contract is includible in D's gross income. Example 3. The facts are the same as in *Example 2* , except that the distribution from the designated Roth account and the rollover to the Roth IRA occur in 2011 (after the end of the 5-taxable-year period of participation used to determine qualified distributions from a designated Roth account). If a distribution is made from the Roth IRA prior to the expiration of the 5-taxable-year period used to determine qualified distributions from a Roth IRA, the distribution would not be a qualified distribution within the meaning of section 408A(d)(2), and any amount of the distribution that exceeded the amount rolled in is includible in D's gross income. Q-5. Can amounts distributed from a Roth IRA be rolled over to a designated Roth account as defined in A-1 of § 1.402A-1? A-5. No. Amounts distributed from a Roth IRA may be rolled over or transferred only to another Roth IRA and are not permitted to be rolled over to a designated Roth account under a section 401(a) or section 403(b) plan. The same rule applies even if all the amounts in the Roth IRA are attributable to a rollover distribution from a designated Roth account in a plan. Q-6. When is this § 1.408A-10 applicable? A-6. The rules of this § 1.408A-10 apply for taxable years beginning on or after January 1, 2006. PART 602—OMB CONTROL NUMBERS UNDER THE PAPERWORK REDUCTION ACT **Par. 7.** The authority citation for part 602 continues to read as follows: Authority: 26 U.S.C. 7805. **Par. 8.** In § 602.101, paragraph
(b)is amended by adding an entry for 1.402A-1 in numerical order to the table to read in part as follows: § 602.101 OMB Control numbers.
(b)* * * CFR part or section where identified and described Current OMB control No. * * * * * 1.402A-1 1545-1992 * * * * * Kevin M. Brown, Deputy Commissioner for Services and Enforcement. Approved: April 23, 2007. Eric Solomon, Assistant Secretary of the Treasury (Tax Policy). [FR Doc. E7-8125 Filed 4-27-07; 8:45 am] BILLING CODE 4830-01-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R05-OAR-2007-0138; FRL-8302-5] Approval and Promulgation of Implementation Plans; Illinois AGENCY: Environmental Protection Agency (EPA). ACTION: Direct final rule. SUMMARY: The EPA is approving the incorporation of revised air pollution permitting and emission standards rules into the Illinois State Implementation Plan (SIP). The State submitted this request for revision to its SIP to EPA on May 31, 2006. This approval makes the State's rules federally enforceable. DATES: This rule is effective on June 29, 2007, unless EPA receives adverse comment by May 30, 2007. If adverse comments are received, EPA will publish a timely withdrawal of the direct final rule in the **Federal Register** informing the public that the rule will not take effect. ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R05-OAR-2007-0138, by one of the following methods: 1. *http://www.regulations.gov:* Follow the on-line instructions for submitting comments. 2. *E-mail:* *blakley.pamela@epa.gov* . 3. *Fax:*
(312)886-5824. 4. *Mail:* Pamela Blakley, Chief, Air Permits Section, Air Programs Branch (AR-18J), U.S. Environmental Protection Agency, 77 West Jackson Boulevard, Chicago, Illinois 60604. 5. *Hand Delivery:* Pamela Blakley, Chief, Air Permits Section, Air Programs Branch (AR-18J), U.S. Environmental Protection Agency, 77 West Jackson Boulevard, Chicago, Illinois 60604. Such deliveries are only accepted during the Regional Office normal hours of operation, and special arrangements should be made for deliveries of boxed information. The Regional Office official hours of business are Monday through Friday, 8:30 a.m. to 4:30 p.m. excluding Federal holidays. *Instructions:* Direct your comments to Docket ID No. EPA-R05-OAR-2007-0138. EPA's policy is that all comments received will be included in the public docket without change and may be made available online at *http://www.regulations.gov* , including any personal information provided, unless the comment includes information claimed to be Confidential Business Information
(CBI)or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through *http://www.regulations.gov* or e-mail. The *http://www.regulations.gov* Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through *http://www.regulations.gov* your e-mail address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. *Docket:* All documents in the docket are listed in the *http://www.regulations.gov* index. Although listed in the index, some information is not publicly available, e.g., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy. Publicly available docket materials are available either electronically in *http://www.regulations.gov* or in hard copy at the U.S. Environmental Protection Agency, Region 5, Air and Radiation Division, 77 West Jackson Boulevard, Chicago, Illinois 60604. This Facility is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. We recommend that you telephone Constantine Blathras at
(312)886-0671 before visiting the Region 5 office. FOR FURTHER INFORMATION CONTACT: Constantine Blathras, Air and Radiation Division, Air Programs Branch, U.S. Environmental Protection Agency, Region 5, 77 W. Jackson Boulevard (AR-18J), Chicago, Illinois 60604. SUPPLEMENTARY INFORMATION: Throughout this document, “we”, “us”, or “our” are used to mean EPA. This supplementary information section is arranged as follows: I. Questions and Answers A. What action is EPA taking? B. Why is EPA taking this action? C. How do these rule changes affect current Federal requirements? D. Why has the State made these regulatory changes? E. What types of emission units are affected by these changes? F. How will EPA's approval of revised permit exemptions affect air quality? G. Does this SIP revision contain any other changes? II. Statutory and Executive Order Reviews I. Questions and Answers A. What action is EPA taking? We are approving two revisions to the Illinois SIP which the State of Illinois requested. Specifically, we are approving the incorporation of revisions to Title 35 of the Illinois Administrative Code (35 IAC) 201.146, Exemptions from State Permit Requirements into the Illinois SIP. These revisions clarify, modify, and add to the list of emission units and activities which are exempt from State permitting requirements. The revision adds some emission units and activities to the list of those that are exempt from certain State permitting requirements, and clarifies that other State permitting requirements may apply for the entire facility. For example, if a new emission unit is subject to Federal New Source Performance Standards, then it will need a State construction permit. We are publishing this action without prior proposal because we view this as a noncontroversial amendment and anticipate no adverse comments. However, in the proposed rules section of this **Federal Register** publication, we are publishing a separate document that will serve as the proposal to approve the state plan if relevant adverse written comments are filed. This rule will be effective June 29, 2007 without further notice unless we receive relevant adverse written comments by May 30, 2007. If we receive such comments, we will withdraw this action before the effective date by publishing a subsequent document that will withdraw the final action. All public comments received will then be addressed in a subsequent final rule based on the proposed action. The EPA will not institute a second comment period. Any parties interested in commenting on this action should do so at this time. If we do not receive any comments, this action will be effective June 29, 2007. B. Why is EPA taking this action? We are acting on a May 31, 2006, request from the Illinois EPA to revise the Illinois SIP. C. How do these rule changes affect current Federal requirements? State construction or operating permits are no longer required for certain categories of emission units and activities listed in 35 IAC 201.146, Exemptions from State Permit Requirements. These rule changes do not affect permitting under major New Source Review or Federal operating permits under Title V of the Clean Air Act. D. Why has the State made these regulatory changes? The State made these changes primarily to remove the requirement to obtain a State construction and operating permit for emission units with very low emissions and where the permit would serve no real environmental or informational need. Many of these emission units have been deemed insignificant under Illinois' Clean Air Act Permit Program (CAAPP) as specified in 35 IAC 201.210 and, therefore, warrant consideration for exemption from State permitting requirements. However, the emission units categories listed as insignificant in 35 IAC 201.210 are not automatically exempted in 201.146, because Illinois does not believe that all of the activities listed as insignificant under the CAAPP merit exemption from State permit requirements. Illinois' rationale is that Illinois EPA retains some discretion under the CAAPP, as it applies to sources that are required to submit an application for a State construction and operating permit. The CAAPP permit application process allows Illinois EPA the opportunity to evaluate proposed insignifcant emission units at a source. However, if an emission unit or activity qualifies for exemption from State permitting requirements under 35 IAC 210.146, no State construction and operating permit application is required and Illinois EPA therefore has no opportunity to evaluate the emission unit. Certain amendments to section 201.146 clarify the types of activities or emission units that are covered by an exemption category. In several instances, the amendments modify an existing exemption category so that emission units subject to certain requirements to control emissions will require permits. Illinois believes that permitting for these activities is appropriate to assure compliance with these control requirements. E. What types of emission units are affected by these changes? This SIP revision affects all emission units and activities subject to State permitting requirements pursuant to section 39 of the Illinois Environmental Protection Act (Illinois Act) and 35 IAC 201.142, 201.143, and 201.144. For State operating permits, emission units only qualify for exemption if the units are located at a source that is not subject to the CAAPP pursuant to section 39.5 of the Illinois Act. For construction permits, the exemption also includes emission units at a source subject to the CAAPP. *Section (hhh):* Replacement or addition of air pollution control equipment for existing emission units. The exemption applies only to existing facilities that are permitted and have operated in compliance with their permit for the past year. The new pollution control equipment must maintain or improve air pollution control over the prior levels of target pollutants and not result in a net increase in emissions of any collateral pollutant. The exemption does not apply if the installation or operation of the new or replacement pollution controls would trigger or change applicability of different regulatory requirements. Finally, required monitoring equipment must be carried over to the replacement control device and must incorporate current technology. *Section (iii):* Replacement, addition, or modification of emission units at facilities with federally enforceable State operating permits limiting their potential to emit in certain circumstances. This provision affects some units or activities at FESOP sources that do not fit under any of the existing listed exemptions under Section 201.146 and that are still insignificant from a permitting standpoint. Under this exemption, permits are not necessary for units at minor FESOP sources with low potential to emit (less than 0.1 pound per hour or 0.44 tons per year) any regulated air pollutant absent air pollution equipment from the new or modified unit that have no outstanding compliance or enforcement issues. Also, raw materials and fuels that cause or contribute to emissions must not contain a hazardous air pollutant equal to or greater than 0.01 percent by weight. Further, this exemption is not available to a source that must meet New Source Performance Standards and New Source Review requirements under the Clean Air Act or if outstanding compliance or enforcement issues exist. *Section (jjj):* Replacement, addition, or modification of emission units at permitted sources that are not major sources subject to Section 39.5 and that do not have a federally enforceable state operating permit limiting their potential to emit. This exemption is limited to sources with the low potential to emit of any regulated air pollutant absent air pollution equipment from the new or modified unit that have no outstanding compliance or enforcement issues at the source. This exemption is available for minor sources that have a slightly greater potential to emit (up to 0.5 pounds per hour) so long as the facility notifies the IEPA of its intent to construct or install a new emissions unit or modification. This provision requires permitting if the additional emissions from the unit could change the sources' status with respect to its potential to emit. This exemption is also not available to a source that must meet New Source Performance Standards and New Source Review requirements under the Clean Air Act. *Section (kkk):* The owner or operator of a CAAPP source is not required to obtain an air pollution control construction permit for the construction or modification of an emission unit or activity that is an insignificant activity as addressed by Section 201.210 or 201.211. Section 201.212 must still be followed, as applicable. Other than excusing the owner or operator of a CAAPP source from the requirement to obtain an air pollution control construction permit for the emission units or activities, nothing in this subsection shall alter or affect the liability of the CAAPP source for compliance with emission standards and other requirements that apply to the emission units or activities, either individually or in conjunction with other emission units or activities constructed, modified, or located at the source. This section creates a list of permit exempt insignificant activities similar to those for CAAPP sources. See 35 Ill. Adm. Code 201.210 through 210.211. Owners or operators must notify the Agency when they add insignificant activities. Facilities must still comply with otherwise applicable emission standards or other regulatory requirements. *Section (lll):* Plastic injection molding operations. This section revises the Illinois' regulations regarding exemptions from air construction and operating permit requirements to add a category for plastic injection molding operations to the existing list of permit exemptions in Section 201.146. Many of these emission units have been deemed insignificant under Illinois' CAAPP as specified in 35 IAC 201.210 and, therefore, warrant consideration for exemption from State permitting requirements. However, the emission units categories listed as insignificant in 35 IAC 201.210 are not automatically exempted in 201.146, because Illinois does not believe that all of the activities listed as insignificant under the CAAPP merit exemption from State permit requirements. Illinois' rationale is that Illinois EPA retains some discretion under the CAAPP, as it applies to sources that are required to submit an application for a State construction and operating permit. The CAAPP permit application process allows Illinois EPA the opportunity to evaluate proposed insignificant emission units at a source. However, if an emission unit or activity qualifies for exemption from State permitting requirements under 35 IAC 210.146, no State construction and operating permit application is required and Illinois EPA therefore has no opportunity to evaluate the emission unit. F. How will EPA's approval of revised permit exemptions affect air quality? Control requirements are independent of whether or not a source must have an operating permit. Other Federal and State regulations are not impeded by these revisions. EPA does not anticipate that this action will adversely affect air quality because the permit exemption emission thresholds are below major source construction significant emission rates. Sources below the major source construction significant emission rates are not generally required to perform an air quality analysis during minor source permitting because they are unlikely to adversely impact air quality. The purpose of this revision is to relieve the IEPA and owners and operators from the burden of state construction and operation permitting for these very low emitting emission units and activities. The existing language of Section 201.146, which will be applicable to this exemption, provides, “* * * The permitting exemptions in this Section do not relieve the owner or operator of any source from the obligation to comply with any other applicable requirements, including the obligation to obtain a permit pursuant to Section 9.1(d) and 39.5 of the Act, Sections 165, 173, and 502 of the Clean Air Act or any other applicable permit or registration requirement.” Although there are no specific emission limitations or emission controls prescribed by these regulatory revisions, the affected units and activities will remain subject to all regulations governing general applicability, such as the regulatory prohibition on emissions in excess of major source thresholds; the protection of the national ambient air quality standards, and the protection of the prevention of significant deterioration increments. G. Does this SIP revision contain any other changes? There are no additional changes being requested in this SIP revision. II. Statutory and Executive Order Reviews Executive Order 12866: Regulatory Planning and Review Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. Executive Order 13211: Actions That Significantly Affect Energy Supply, Distribution, or Use Because it is not a “significant regulatory action” under Executive Order 12866 or a “significant energy action,” this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). Regulatory Flexibility Act This action merely approves state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 *et seq.* ). Unfunded Mandates Reform Act Because this rule approves pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). Executive Order 13175: Consultation and Coordination With Indian Tribal Governments This rule also does not have tribal implications because it will not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified by Executive Order 13175 (59 FR 22951, November 9, 2000). Executive Order 13132: Federalism This action also does not have Federalism implications because it does not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This action merely approves a state rule implementing a federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. Executive Order 13045: Protection of Children From Environmental Health and Safety Risks This rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it approves a state rule implementing a Federal standard. National Technology Transfer Advancement Act In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. In this context, in the absence of a prior existing requirement for the state to use voluntary consensus standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission, to use VCS in place of a SIP submission that otherwise satisfies the provisions of the Clean Air Act. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. Paperwork Reduction Act This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ). Congressional Review Act The Congressional Review Act, 5 U.S.C. 801 *et seq.* , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the **Federal Register** . A major rule cannot take effect until 60 days after it is published in the **Federal Register** . This action is not a “major rule” as defined by 5 U.S.C. 804(2). Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by June 29, 2007. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. ( *See* section 307(b)(2)). List of Subjects in 40 CFR Part 52 Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds. Dated: April 6, 2007. Walter W. Kovalick, Acting Regional Administrator, Region 5. For the reasons stated in the preamble, part 52, chapter I, title 40 of the Code of Federal Regulations is amended as follows: PART 52—[AMENDED] 1. The authority citation for part 52 continues to read as follows: Authority: 42 U.S.C. 7401 *et seq.* Subpart O—Illinois 2. Section 52.720 is amended by adding paragraph (c)(177) to read as follows: § 52.720 Identification of plan.
(c)* * *
(177)On May 31, 2006, the Illinois Environmental Protection Agency submitted a requested revision to the Illinois State Implementation Plan. This revision provides additional exemptions from State of Illinois permit requirements codified by the State at Part 201 of Title 35 of the Illinois Administrative Code (35 IAC Part 201).
(i)Incorporation by reference. Illinois Administrative Code, Title 35: Environmental Protection, Subtitle B: Air Pollution, Chapter I: Pollution Control Board, Subchapter a: Permits and General Provisions, Part 201 Permits and General Provisions, Subpart C: Prohibitions, Section 201.146 Exemptions from State Permit Requirements paragraphs (hhh), (iii), (jjj), (kkk), and (lll). Amended at 30 Ill. Reg. 4901, effective March 3, 2006. [FR Doc. E7-8104 Filed 4-27-07; 8:45 am] BILLING CODE 6560-50-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 712 and 716 [EPA-HQ-OPPT-2005-0014 and EPA-HQ-OPPT-2005-0055; FRL-8124-9] RIN 2070-AB08 and 2070-AB11 Removal of Two Chemical Substances from Preliminary Assessment Information Reporting and Health and Safety Data Reporting Rules AGENCY: Environmental Protection Agency (EPA). ACTION: Direct final rule. SUMMARY: This direct final rule the removes chemical substances phosphorotrithious acid, tributyl ester, CAS No. 150-50-5, and phosphorodithioic acid, O,O-diethyl ester, sodium salt, CAS No. 3338-24-7, which were inadvertently added to the list of voluntary High Production Volume
(HPV)Challenge Program orphan (unsponsored) chemical substances by EPA. As a result, these chemical substances were inadvertently added to two final rules: The Preliminary Assessment Information Reporting
(PAIR)rule (Toxic Substances Control Act
(TSCA)section 8(a)) and the Health and Safety Data Reporting rule (TSCA section 8(d)), both published in the **Federal Register** issue of August 16, 2006. With this removal action, persons who manufacture (including import) either of these two chemical substances are no longer subject to the reporting requirements imposed by these TSCA section 8(a) and 8(d) rules. DATES: This rule is effective on June 29, 2007 without further notice, unless EPA receives adverse comment on or before May 30, 2007. ADDRESSES: Submit your comments, identified by docket identification
(ID)numbers EPA-HQ-OPPT-2005-0014 and EPA-HQ-OPPT-2005-0055, by one of the following methods: • *Federal eRulemaking Portal* : *http://www.regulations.gov* . Follow the on-line instructions for submitting comments. • *Mail* : Document Control Office (7407M), Office of Pollution Prevention and Toxics (OPPT), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001. • *Hand Delivery* : OPPT Document Control Office (DCO), EPA East Bldg., Rm. 6428, 1201 Constitution Ave., NW., Washington, DC. Attention: Docket ID Numbers EPA-HQ-OPPT-2005-0014 and EPA-HQ-OPPT-2005-0055. The DCO is open from 8 a.m. to 4 p.m., Monday through Friday, excluding legal holidays. The telephone number for the DCO is
(202)564-8930. Such deliveries are only accepted during the DCO’s normal hours of operation, and special arrangements should be made for deliveries of boxed information. *Instructions* : Direct your comments to docket ID numbers EPA-HQ-OPPT-2005-0014 and EPA-HQ-OPPT-2005-0055. EPA's policy is that all comments received will be included in the docket without change and may be made available on-line at *http://www.regulations.gov* , including any personal information provided, unless the comment includes information claimed to be Confidential Business Information
(CBI)or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through regulations.gov or e-mail. The regulations.gov website is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through regulations.gov, your e-mail address will be automatically captured and included as part of the comment that is placed in the docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. For additional information about EPA’s public docket, visit the EPA Docket Center homepage at *http://www.epa.gov/epahome/dockets.htm* . *Docket* : All documents in the docket are listed in the docket index available in regulations.gov. To access the electronic docket, go to *http://www.regulations.gov* , select “Advanced Search,” then “Docket Search.” Insert the docket ID number where indicated and select the “Submit” button. Follow the instructions on the regulations.gov web site to view the docket index or access available documents. Although listed in the index, some information is not publicly available, e.g., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy. Publicly available docket materials are available electronically at *http://www.regulations.gov* , or, if only available in hard copy, at the OPPT Docket. The OPPT Docket is located in the EPA Docket Center (EPA/DC) at Rm. 3334, EPA West Bldg., 1301 Constitution Ave., NW., Washington, DC. The EPA/DC Public Reading Room hours of operation are 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding Federal holidays. The telephone number of the EPA/DC Public Reading Room is
(202)566-1744, and the telephone number for the OPPT Docket is
(202)566-0280. Docket visitors are required to show photographic identification, pass through a metal detector, and sign the EPA visitor log. All visitor bags are processed through an X-ray machine and subject to search. Visitors will be provided an EPA/DC badge that must be visible at all times in the building and returned upon departure. FOR FURTHER INFORMATION CONTACT: *For general information contact* : Colby Lintner, Regulatory Coordinator, Environmental Assistance Division (7408M), Office of Pollution Prevention and Toxics, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; telephone number:
(202)554-1404; e-mail address: *TSCA-Hotline@epa.gov.* *For technical information contact* : Joe Nash, Chemical Control Division (7405M), Office of Pollution Prevention and Toxics, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001; telephone number:
(202)564-8886; fax number:
(202)564-4765; e-mail address: *ccd.citb@epa.gov* . SUPPLEMENTARY INFORMATION: I. General Information A. Does this Action Apply to Me? You may be potentially affected by this action if you manufacture (defined by statute to include import) either of the two chemical substances listed in this direct final rule. Entities potentially affected by this action may include, but are not limited to: • Chemical manufacturers (including importers), (NAICS codes 325, 32411), e.g., persons who manufacture (defined by statute to include import) one or more of the subject chemical substances. This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult the technical person listed under FOR FURTHER INFORMATION CONTACT . B. How Can I Access Electronic Copies of this Document? In addition to accessing an electronic copy of this **Federal Register** document through the electronic docket at *http://www.regulations.gov* , you may access this “ **Federal Register** ” document electronically through the EPA Internet under the “ **Federal Register** ” listings at *http://www.epa.gov/fedrgstr* . Frequently updated electronic versions of 40 CFR parts 712 and 716 are available through the Government Printing Office's pilot e-CFR site at *http://www.gpoaccess.gov/ecfr* . C. What Should I Consider as I Prepare My Comments for EPA? 1. *Submitting CBI* . Do not submit this information to EPA through regulations.gov or e-mail. Clearly mark the part or all of the information that you claim to be CBI. For CBI information in a disk or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM as CBI and then identify electronically within the disk or CD-ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2. 2. *Tips for preparing your comments* . When submitting comments, remember to: i. Identify the document by docket ID number and other identifying information (subject heading, **Federal Register** date and page number). ii. Follow directions. The Agency may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations
(CFR)part or section number. iii. Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes. iv. Describe any assumptions and provide any technical information and/or data that you used. v. If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced. vi. Provide specific examples to illustrate your concerns and suggest alternatives. vii. Explain your views as clearly as possible, avoiding the use of profanity or personal threats. viii. Make sure to submit your comments by the comment period deadline identified. II. Background A. What Action is the Agency Taking? The chemical substances phosphorotrithious acid, tributyl ester, CAS No. 150-50-5, and phosphorodithioic acid, O,O-diethyl ester, sodium salt, CAS No. 3338-24-7, are being removed from the table in 40 CFR 712.30(e) of the TSCA section 8(a) PAIR rule published in the **Federal Register** of August 16, 2006 (Ref. 1), and the table in 40 CFR 716.120(d) of the TSCA section 8(d) Health and Safety Data Reporting rule published in the **Federal Register** of August 16, 2006 (Ref. 2). On August 16, 2006, EPA published a final PAIR rule under TSCA section 8(a) (40 CFR part 712), which requires manufacturers (including importers) of chemical substances in the category of voluntary HPV Challenge Program orphan (unsponsored) chemical substances on the ITC's TSCA section 4(e) *Priority Testing List* to submit a one-time report on general production/importation volume, end use, and exposure-related information to EPA. Also on August 16, 2006, EPA published a final Health and Safety Data Reporting rule under TSCA section 8(d) (40 CFR part 716), which requires manufacturers (including importers) of chemical substances in this category of voluntary HPV Challenge Program orphan (unsponsored) chemical substances to submit certain unpublished health and safety data to EPA. On September 15, 2006, EPA published a final rule (Ref. 3) that revised the effective date of the two rules published on August 16, 2006. The effect of this action is that persons who manufacture (including import) either of the two chemical substances are not subject to the reporting requirements imposed by the final TSCA section 8(a) and 8(d) rules published on August 16, 2006, and the rule published on September 15, 2006 (Ref. 3), that changed the effective date for these two rules. B. What is the Agency's Authority for Taking This Action? EPA promulgated the PAIR rule under TSCA section 8(a) (15 U.S.C. 2607(a)), and it is codified at 40 CFR part 712. This model TSCA section 8(a) rule establishes standard reporting requirements for certain manufacturers (including importers) of the chemical substances listed in the rule at 40 CFR 712.30. The final rule published by EPA on August 16, 2006, amended the model TSCA section 8(a) rule by adding the ITC category of certain voluntary HPV Challenge Program orphan (unsponsored) chemical substances (Ref. 1). EPA promulgated the model Health and Safety Data Reporting rule under TSCA section 8(d) (15 U.S.C. 2607(d)), and it is codified at 40 CFR part 716. The TSCA section 8(d) model rule requires past, current, and prospective manufacturers, importers, and (if specified by EPA in a particular notice or rule under TSCA section 8(d)) processors of listed chemical substances to submit to EPA copies and lists of unpublished health and safety studies on the listed chemical substances that they manufacture, import, or (if specified by EPA in a particular notice or rule under TSCA section 8(d)) process. The final rule published by EPA on August 16, 2006, amended the model TSCA section 8(d) rule by adding the ITC category of certain voluntary HPV Challenge Program orphan (unsponsored) chemical substances (Ref. 2). C. Why is EPA Using a Direct Final Rule? EPA is publishing this direct final rule without a prior proposed rule because we view this as a non-controversial action and anticipate no adverse comment. If EPA receives adverse comment, we will publish a timely withdrawal in the **Federal Register** informing the public that the direct final rule will not take effect. Any parties interested in commenting must do so on or before May 30, 2007. D. Why are These Two Chemical Substances Being Removed? The chemical substances phosphorotrithious acid, tributyl ester, CAS No. 150-50-5, and phosphorodithioic acid, O,O-diethyl ester, sodium salt, CAS No. 3338-24-7, were inadvertently added by EPA to the list of HPV orphan orphan (unsponsored) chemical substances. This list was the source of the category of “Voluntary HPV Challenge Program orphan (unsponsored) chemicals” that was the subject of the TSCA section 8(a) PAIR rule and TSCA section 8(d) Health and Safety Data Reporting rule published in the **Federal Register** of August 16, 2006 (Refs. 1 and 2). These two chemicals were originally sponsored in the HPV Challenge Program by Bayer CropScience on March 15, 1999 (Ref. 4). Subsequently, in a letter dated December 29, 2003, Bayer CropScience requested that EPA “designate the two chemicals as ‘no longer HPV’ on the HPV Challenge Program Chemical List” because Bayer CropScience considered the chemicals to be “non-isolated intermediates” (Ref. 5). In a letter dated December 3, 2004, EPA responded that, based on a review of the information submitted by Bayer CropScience, EPA had determined that the two substances were “isolated intermediates” and, consequently, did not meet the ‘no longer HPV’ criteria and that “they will remain in the HPV Challenge Program and should continue to be reported” (Ref. 6). In a letter dated December 15, 2005, Bayer CropScience clarified the status of the two chemicals (Ref. 7). In that letter, Bayer “recommit[ed] to sponsoring” both chemicals in the HPV Challenge Program and proposed to include the two chemicals into two categories. This record demonstrates that Bayer CropScience did not withdraw its commitment to sponsor these two chemicals in the HPV Challenge Program. Consequently, EPA is removing these two chemicals from the table in 40 CFR 712.30(e) of the TSCA section 8(a) PAIR rule published in the **Federal Register** of August 16, 2006 (Ref. 1), and the table in 40 CFR 716.120(d) of the TSCA section 8(d) Health and Safety Data Reporting rule published in the **Federal Register** of August 16, 2006 (Ref. 2). This action does not preclude the future listing of these two chemical substances under the TSCA section 8(a) PAIR rule or the TSCA section 8(d) Health and Safety Data Reporting rule should the information be reasonably required. III. Economic Analysis In the economic analysis conducted for the final TSCA section 8(a) PAIR rule, the Agency estimated the total reporting cost to industry to be $644,000 for all 243 chemical substances, or approximately $2,650 per chemical substance (Ref. 1). The Agency is estimated to incur an additional $248,000 or $1,021 per chemical substance to provide public support for the TSCA section 8(a) PAIR rule and to process the data (Ref. 1). The total cost of the TSCA section 8(a) rule, per chemical substance, is estimated to be approximately $3,671. This direct final rule removes two chemical substances from the TSCA section 8(a) PAIR rule. Therefore, costs are estimated to be reduced by $7,342 (two chemical substances x $3,671 per chemical substance). Furthermore, this direct final rule will also remove two chemical substances from the TSCA section 8(d) Health and Safety Data Reporting rule. The economic analysis conducted for the TSCA section 8(d) Health and Safety Data Reporting rule estimates that the total cost to industry is $110,000 and to the Agency is $79,000, or $453 and $325 per chemical substance, respectively, for a total of $778 per chemical substance (Ref. 2). Because this direct final rule removes two chemical substances from the TSCA section 8(d) Health and Safety Data Reporting rule, the costs of the TSCA section 8(d) Health and Safety Data Reporting rule are estimated to be reduced by $1,556 (two chemical substances x $778). Therefore, the removal of two chemical substances from the TSCA section 8(a) and TSCA section 8(d) rules is estimated to result in a total reduction in costs of $8,898. IV. References The dockets for this direct final rule are the dockets established for the TSCA section 8(a) PAIR rule (docket ID number EPA-HQ-OPPT-2005-0014) (Ref. 1) and the TSCA section 8(d) Health and Safety Data Reporting rule (docket ID number EPA-HQ-OPPT-2005-0055) (Ref. 2). These dockets are available for review as specified in ADDRESSES . The following is a listing of the materials referenced in this document that have been placed in the dockets: 1. EPA. Preliminary Assessment Information Reporting; Addition of Certain Chemicals. **Federal Register** (71 FR 47122, August 16, 2006) (FRL-7764-9). Available on-line at: *http://www.epa.gov/fedrgstr* . 2. EPA. Health and Safety Data Reporting; Addition of Certain Chemicals. **Federal Register** (71 FR 47130, August 16, 2006) (FRL-7764-7). Available on-line at: *http://www.epa.gov/fedrgstr* . 3. EPA. Preliminary Assessment Information Reporting Rule and Health and Safety Data Reporting Rule; Revision of Effective Dates. **Federal Register** (71 FR 54434, September 15, 2006) (FRL-8094-8). Available on-line at: *http://www.epa.gov/fedrgstr* . 4. Bayer Corporation. Letter from Ron Fuchs (Bayer Corporation) to Carol Browner
(EPA)RE: Sponsorship of chemicals in the HPV Challenge Program. March 15, 1999. 5. Bayer Corporation. Letter from Janet M. Mostowy (Bayer Corporation) to Michael Leavitt
(EPA)RE: Request to designate chemicals as ‘no longer HPV.’ December 29, 2003. 6. EPA. Letter from Diane Sheridan (EPA/OPPT) to Janet M. Mostowy (Bayer Corporation) RE: EPA response to December 29, 2003 letter from Bayer Corporation. December 3, 2004. 7. Bayer CropScience. Letter from George S. Goodridge to Oscar Hernandez (EPA/OPPT) RE: Clarification of status of chemicals appearing on EPA’s 9/16/05 orphan list. December 15, 2005. V. Statutory and Executive Order Reviews A. Executive Order 12866: Regulatory Planning and Review The Office of Management and Budget
(OMB)has exempted actions under TSCA sections 8(a) and 8(d) related to the PAIR and Health and Safety Data Reporting rules from the requirements of Executive Order 12866, entitled *Regulatory Planning and Review* (58 FR 51735, October 4, 1993). In addition, this direct final rule does not impose any new requirements and will result in a burden and cost reduction; therefore, it is not subject to OMB review under the Executive order. B. Paperwork Reduction Act The information collection requirements contained in TSCA sections 8(a) PAIR and 8(d) Health and Safety Data Reporting rules have already been approved by OMB under the provisions of the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 *et seq* ., and OMB control numbers 2070-0054 (EPA ICR No. 0586) and 2070-0004 (EPA ICR No. 0575). The collection activities in this direct final rule are captured by the existing approval and do not require additional review and/or approval by OMB. C. Regulatory Flexibility Act Because this direct final rule eliminates reporting requirements, the Agency certifies pursuant to section 605(b) of the Regulatory Flexibility Act (RFA), 5 U.S.C. 601 *et seq* ., that this action will not have a significant adverse economic impact on a substantial number of small entities. D. Unfunded Mandates Reform Act Pursuant to Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, EPA has determined that this direct final rule does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any 1 year. In addition, EPA has determined that this direct final rule will not significantly or uniquely affect small governments. Accordingly, the direct final rule is not subject to the requirements of UMRA sections 202, 203, 204, or 205. E. Executive Order 13132: Federalism This direct final rule has no Federalism implications because it will not have substantial direct effects on States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132, entitled *Federalism* (64 FR 43255, August 10, 1999). F. Executive Order 13175: Consultation and Coordination with Indian Tribal Governments This direct final rule has no tribal implications because it will not have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, nor on the distribution of power and responsibilities between the Federal Government and Indian tribes as specified in Executive Order 13175, entitled *Consultation and Coordination with Indian Tribal Governments* (59 FR 22951, November 6, 2000). G. Executive Order 13045: Protection of Children from Environmental Health Risks and Safety Risks Executive Order 13045, entitled *Protection of Children from Environmental Health Risks and Safety Risks* (62 FR 19885, April 23,1997), does not apply to this direct final rule because this is not an economically significant regulatory action as defined under Executive Order 12866, and it does not concern an environmental health or safety risk that may have a disproportionate effect on children. H. Executive Order 13211: Actions that Significantly Affect Energy Supply, Distribution, or Use This rule is not subject to Executive Order 13211, entitled *Actions that Significantly Affect Energy Supply, Distribution, or Use* (66 FR 28355, May 22, 2001), because this action is not expected to affect energy supply, distribution, or use. I. National Technology Transfer and Advancement Act Because this action does not involve any technical standards, section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note), does not apply to this action. J. Executive Order 12898: Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations This action does not involve special considerations of environmental justice-related issues pursuant to Executive Order 12898, entitled *Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations* (59 FR 7629, February 16, 1994). VI. Congressional Review Act The Congressional Review Act, 5 U.S.C. 801 *et seq* ., generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the **Federal Register** . This rule is not a major rule as defined by 5 U.S.C. 804(2). List of Subjects in 40 CFR Parts 712 and 716 Environmental protection, Chemicals, Hazardous substances, Health and safety, Reporting and recordkeeping requirements. Dated: April 23, 2007. Charles M. Auer, Director, Office of Pollution Prevention and Toxics. Therefore, 40 CFR chapter I is amended as follows: PART 712—[AMENDED] 1. The authority citation for part 712 continues to read as follows: Authority: 15 U.S.C. 2607(a). § 712.30 [Amended] 2. In § 712.30, in the table under the heading “Voluntary HPV Challenge Program orphan (unsponsored) chemicals” in paragraph (e), remove the entries CAS No. 150-50-5, Phosphorotrithious acid, tributyl ester and CAS No. 3338-24-7, Phosphorodithioic acid, O,O-diethyl ester, sodium salt. PART 716--[AMENDED] 3. The authority citation for part 716 continues to read as follows: Authority: 15 U.S.C. 2607(d). § 716.120 [Amended] 4. In § 716.120, in the table under the heading “Voluntary HPV Challenge Program orphan (unsponsored) chemicals in paragraph (d), remove the entries Phosphorotrithious acid, tributyl ester, CAS No. 150-50-5 and Phosphorodithioic acid, O,O-diethyl ester, sodium salt, CAS No. 3338-24-7. [FR Doc. 07-2104 Filed 4-27-07; 8:45 am]
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  • 14 CFR 39
  • 1 CFR 51
  • 18 CFR 38
  • 5 CFR 1320.11
  • 5 USC 601-612
  • 16 USC 791-825r
  • 42 USC 7101-7352
  • 20 CFR 220
  • T.D. 9324
  • 26 CFR 1.402
  • Pub. L. 107-16
  • 115 Stat. 103
  • Pub. L. 109-280
  • 120 Stat. 780
  • Treas. Reg. 1.401(k)
  • Rev. Rul. 72-305
  • Rev. Rul. 74-398
  • T.D. 9237
  • 26 CFR 1
  • 26 USC 402A
  • 40 CFR 52
  • Pub. L. 104-4
  • 40 CFR 2
  • 40 CFR 712.30(e)
  • 40 CFR 716.120(d)
  • 40 CFR 712
  • 40 CFR 716
  • 40 CFR 712.30
  • Pub. L. 104-113
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