Unknown. Joint final rules

5,915 words·~27 min read·/register/2016/12/16/2016-30133

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-2016-12-16.xml --- 81 242 Friday, December 16, 2016 Contents Army Army Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 91142-91143 2016-30214 Centers Medicare Centers for Medicare & Medicaid Services NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 91175-91178 2016-30340 2016-30349 Medicare Program: Start-up Funding in Support of the Vermont All-Payer Accountable Care Organization Model—Cooperative Agreement, 91174-91175 2016-30269 Children Children and Families Administration NOTICES Agency Information Collection Activities;

Proposals, Submissions, and Approvals: Tribal Child Support Enforcement Program Annual Data Report, 91178 2016-30291 Coast Guard Coast Guard PROPOSED RULES Drawbridge Operations: Detroit River (Trenton Channel), Grosse Ile, MI, 91086-91088 2016-30342 Commerce Commerce Department See Foreign-Trade Zones Board See Industry and Security Bureau See International Trade Administration See National Oceanic and Atmospheric Administration Committee for Purchase Committee for Purchase From People Who Are Blind or Severely Disabled NOTICES Procurement List;

Additions and Deletions, 91140-91142 2016-30347 2016-30348 Commodity Futures Commodity Futures Trading Commission RULES Aggregation of Positions, 91454-91492 2016-29582 PROPOSED RULES Capital Requirements of Swap Dealers and Major Swap Participants, 91252-91334 2016-29368 Comptroller Comptroller of the Currency RULES Expanded Examination Cycle for Certain Small Insured Depository Institutions and United States Branches and Agencies of Foreign Banks, 90949-90952 2016-30133 Defense Department Defense Department See Army Department See Engineers Corps RULES Federal Acquisition Regulation:

Fair Pay and Safe Workplaces; Injunction, 91636-91641 2016-30091 Federal Acquisition Circular 2005-93; Small Entity Compliance Guide, 91641-91642 2016-30092 Federal Acquisition Circular 2005-93; Introduction, 91626 2016-30089 Paid Sick Leave for Federal Contractors, 91627-91636 2016-30090 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 91143-91144 2016-30271 Arms Sales, 91144-91150 2016-30225 2016-30229 Meetings: Military Family Readiness Council, 91147-91148 2016-30274 Education Department Education Department NOTICES Agency Information Collection Activities;

Proposals, Submissions, and Approvals: Measuring Educational Gain in the National Reporting System for Adult Education, 91157 2016-30322 Rehabilitation Services Administration Grant Re-allotment Form, 91155-91156 2016-30321 Meetings: National Assessment Governing Board; Teleconference, 91156-91157 2016-30328 Employment and Training Employment and Training Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Joint Quarterly Narrative Progress Report Template, 91200-91201 2016-30204 Meetings:

Advisory Committee on Apprenticeship, 91200 2016-30205 Energy Department Energy Department See Federal Energy Regulatory Commission RULES Energy Conservation Programs: Test Procedures for Cooking Products, 91418-91452 2016-29077 PROPOSED RULES Energy Efficiency Program for Commercial and Industrial Equipment: Availability of Provisional Analysis Tools and Notice of Data Availability, 91049 2016-30299 Engineers Engineers Corps PROPOSED RULES Use of U.S. Army Corps of Engineers Reservoir Projects for Domestic, Municipal & Industrial Water Supply, 91556-91590 2016-30017 NOTICES Environmental Impact Statements;

Availability, etc.: Draft Missouri River Recovery Management Plan, 91151-91154 2016-30294 Update of Water Control Manuals and Water Supply Storage Assessment for the Apalachicola-Chattahoochee-Flint River Basin, 91154-91155 2016-30295 Floodplain Management as Amended by the Federal Flood Risk Management Standard, 91150-91151 2016-30240 Environmental Protection Environmental Protection Agency RULES Air Quality State Implementation Plans; Approvals and Promulgations: Ohio; Redesignation of the Ohio Portion of the Cincinnati, Ohio-Kentucky-Indiana Area to Attainment of the 2008 Ozone Standard, 91035-91037 2016-30054 Tennessee;

Revisions to the Knox County Portion of the Tennessee State Implementation Plan, 91033-91035 2016-30056 PROPOSED RULES Air Quality State Implementation Plans; Approvals and Promulgations: Determinations of Attainment by the Attainment Date, Determinations of Failure to Attain by the Attainment Date and Reclassification for Certain Nonattainment Areas, etc., 91088-91097 2016-30174 Regulation of Certain Uses under Toxic Substances Control Act: Trichloroethylene, 91592-91624 2016-30063 NOTICES Certain New Chemicals:

Receipt and Status Information for November 2016, 91162-91168 2016-30325 Consent Decrees: Clean Air Act Citizen Suit, 91169-91171 2016-30329 Environmental Impact Statements; Availability, etc.: Weekly Receipts, 91169 2016-30350 Permits: Pesticide Experimental Use; Receipt of Application, 91168-91169 2016-30326 Federal Aviation Federal Aviation Administration RULES Airworthiness Directives: Airbus Airplanes, 90958-90961, 90964-90969, 90971-90974 2016-29249 2016-30036 2016-30038 Bombardier, Inc.

Airplanes, 90961-90964 2016-29815 International Aero Engines AG Turbofan Engines, 90969-90971 2016-30064 Rolls-Royce plc Turbofan Engines, 90974-90976 2016-30065 The Boeing Company Airplanes, 90955-90958 2016-29251 Class D Airspace; Amendments: St. Petersburg, FL, 90976-90977 2016-29634 IFR Altitudes; Miscellaneous Amendments, 90978-90979 2016-29429 Qualification, Service, and Use of Crewmembers and Aircraft Dispatchers; Related Aircraft Amendment, 90979-90983 2016-30211 PROPOSED RULES Airworthiness Directives:

Airbus Airplanes, 91060-91066 2016-28802 2016-29676 Bombardier, Inc. Airplanes, 91058-91060 2016-29671 Fokker Services B.V. Airplanes, 91068-91071 2016-28669 The Boeing Company Airplanes, 91066-91068 2016-29670 NOTICES Airport Property Releases: Quitclaim Deed and Grant Assurance Obligations at Reno Stead Airport, Reno, Washoe County, NV, 91238 2016-30210 Federal Communications Federal Communications Commission NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 91171 2016-30230 Federal Deposit Federal Deposit Insurance Corporation RULES Expanded Examination Cycle for Certain Small Insured Depository Institutions and United States Branches and Agencies of Foreign Banks, 90949-90952 2016-30133 Federal Energy Federal Energy Regulatory Commission NOTICES Agency Information Collection Activities;

Proposals, Submissions, and Approvals, 91160-91162 2016-30208 Applications: Appalachian Power Co., 91157-91158 2016-30202 Environmental Assessments; Availability, etc.: Hawks Nest Hydro, LLC, 91162 2016-30201 Northern Natural Gas Co., Cedar Station Upgrade Project, 91159-91160 2016-30207 Petitions for Declaratory Orders: Ad Hoc Renewable Energy Financing Group, 91158-91159 2016-30290 Schedules for Environmental Review: Columbia Gas Transmission, LLC, WB XPress Project, 91159 2016-30206 Federal Motor Federal Motor Carrier Safety Administration NOTICES Qualification of Drivers;

Exemption Applications: Diabetes, 91242-91245 2016-30281 Implantable Cardioverter Defibrillators, 91238-91239 2016-30283 Vision, 91239-91242 2016-30286 Federal Railroad Federal Railroad Administration NOTICES Application for Approval of Discontinuance or Modification of a Railroad Signal System, 91245 2016-30141 Federal Reserve Federal Reserve System RULES Capital Rules: Implementation of Capital Requirements for Global Systemically Important Bank Holding Companies, 90952-90955 2016-29966 Expanded Examination Cycle for Certain Small Insured Depository Institutions and United States Branches and Agencies of Foreign Banks, 90949-90952 2016-30133 NOTICES Banking Organization Systemic Risk Report, 91171-91173 2016-29967 Formations of, Acquisitions by, and Mergers of Bank Holding Companies, 91173-91174 2016-30301 Fish Fish and Wildlife Service RULES Eagle Permits:

Eagle Incidental Take and Take of Eagle Nests, 91494-91554 2016-29908 NOTICES Environmental Impact Statements; Availability, etc.: Silvio O. Conte National Fish and Wildlife Refuge, 91185-91187 2016-30420 Food and Drug Food and Drug Administration PROPOSED RULES List of Bulk Drug Substances that can be used to Compound Drug Products, 91071-91082 2016-30109 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Requirement for Submission of Information on Pediatric Subpopulations That Suffer From a Disease or Condition That a Device Is Intended to Treat, Diagnose, or Cure, 91181-91183 2016-30243 Guidance:

Gifts to the Food and Drug Administration; Evaluation and Acceptance, 91180-91181 2016-30312 International Cooperation on Harmonisation of Technical Requirements for Registration of Veterinary Medicinal Products; Bioequivalence—Blood Level Bioequivalence Study, 91179-91180 2016-30309 Foreign Trade Foreign-Trade Zones Board NOTICES AGRU America Charleston, LLC, Foreign-Trade Zone 21, North Charleston, SC, 91115 2016-30341 General Services General Services Administration RULES Federal Acquisition Regulation:

Fair Pay and Safe Workplaces; Injunction, 91636-91641 2016-30091 Federal Acquisition Circular 2005-93; Small Entity Compliance Guide, 91641-91642 2016-30092 Federal Acquisition Circular 2005-93; Introduction, 91626 2016-30089 Paid Sick Leave for Federal Contractors, 91627-91636 2016-30090 Health and Human Health and Human Services Department See Centers for Medicare & Medicaid Services See Children and Families Administration See Food and Drug Administration See National Institutes of Health Homeland Homeland Security Department See Coast Guard See Transportation Security Administration See U.S.

Customs and Border Protection Housing Housing and Urban Development Department RULES Modernizing the Consolidated Planning Process To Narrow the Digital Divide and Increase Resilience to Natural Hazards, 90997-91012 2016-30421 PROPOSED RULES Manufactured Housing Program: Minimum Payments to the States, 91083-91086 2016-30153 NOTICES Federal Properties Suitable as Facilities to Assist the Homeless, 91185 2016-29821 Industry Industry and Security Bureau RULES Implementation of the February 2015 Australia Group Intersessional Decisions and the June 2015 Australia Group Plenary Understandings, 90983-90987 2016-30099 Interior Interior Department See Fish and Wildlife Service See Land Management Bureau See National Park Service See Ocean Energy Management Bureau Internal Revenue Internal Revenue Service RULES Treatment of Certain Transfers of Property to Foreign Corporations, 91012-91032 2016-29791 International Trade Adm International Trade Administration NOTICES Antidumping or Countervailing Duty Investigations, Orders, or Reviews:

Certain Biaxial Integral Geogrid Products From the People's Republic of China, 91136 2016-30311 Certain Hardwood Plywood Products from the People's Republic of China, 91131-91136 2016-30304 Certain Hardwood Plywood Products from the People's Republic of China; Initiation of Less Than Fair Value Investigation, 91125-91131 2016-30305 Certain Pasta from Italy; Final Results of Antidumping Duty Administrative Review; 2014-2015, 91120-91122 2016-30324 Diffusion-Annealed, Nickel-Plated Flat-Rolled Steel Products from Japan:

Administrative Review; 2013-2015, 91116-91118 2016-30306 Initiation of Administrative Reviews, 91122-91125 2016-30310 Lightweight Thermal Paper from the People's Republic of China; Administrative Review, 2014-2015, 91115-91116 2016-30308 Stainless Steel Bar From India, 91118-91120 2016-30323 International Trade Com International Trade Commission NOTICES Investigations; Determinations, Modifications, and Rulings, etc.: Carbon and Alloy Seamless Standard, Line, and Pressure Pipe from Japan and Romania, 91199-91200 2016-30226 Certain Automated Teller Machines, ATM Products, Components Thereof, and Products Containing the Same, 91197-91198 2016-30298 Certain Iron Mechanical Transfer Drive Components from Canada and China, 91198-91199 2016-30244 Circular Welded Carbon-Quality Steel Pipe from Oman, Pakistan, the United Arab Emirates, and Vietnam, 91199 2016-30250 Labor Department Labor Department See Employment and Training Administration See Occupational Safety and Health Administration Land Land Management Bureau NOTICES Public Land Orders:

Miller Lake Recreational Area, OR, 91188-91189 2016-30317 Records of Decision: Energy Gateway South Transmission Project and Approved Land use Plan Amendments in Colorado, Utah, and Wyoming, 91187-91188 2016-30346 TransWest Express Transmission Project in Wyoming, Colorado, Utah and Nevada, 91189-91191 2016-30345 Legal Legal Services Corporation RULES Procedures for Disclosure of Information under the Freedom of Information Act, 91037-91045 2016-30144 Maritime Maritime Administration NOTICES Requests for Administrative Waivers of the Coastwise Trade Laws:

Vessel FOUR CAPTAINS, 91246-91247 2016-30196 Vessel OUTRIDER, 91245-91246 2016-30198 Vessel TIGRESS, 91247 2016-30197 NASA National Aeronautics and Space Administration RULES Federal Acquisition Regulation Supplement: Contractor Financial Reporting of Property, 91045-91048 2016-30157 Federal Acquisition Regulation: Fair Pay and Safe Workplaces; Injunction, 91636-91641 2016-30091 Federal Acquisition Circular 2005-93; Small Entity Compliance Guide, 91641-91642 2016-30092 Federal Acquisition Circular 2005-93;

Introduction, 91626 2016-30089 Paid Sick Leave for Federal Contractors, 91627-91636 2016-30090 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 91206 2016-30319 National Institute National Institutes of Health NOTICES Extension of Effective Date of NIH Policy on the Use of a Single Institutional Review Board for Multi-Site Research, 91183 2016-30398 Meetings: National Advisory Council on Alcohol Abuse and Alcoholism, 91183-91184 2016-30218 National Institute on Alcohol Abuse and Alcoholism, 91184 2016-30219 National Institute on Drug Abuse, 91184 2016-30220 National Oceanic National Oceanic and Atmospheric Administration PROPOSED RULES Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic:

Snapper-Grouper Fishery of the South Atlantic Region; Amendment 37, 91104-91114 2016-30223 Sea Turtle Conservation: Shrimp Trawling Requirements, 91097-91104 2016-30224 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 91136-91137, 91140 2016-30215 2016-30217 Agency Information Collection Activities; Proposals, Submissions, and Approvals: Atlantic Highly Migratory Species Release Reports, 91137 2016-30216 Environmental Impact Statements;

Availability, etc.: Alabama Trustee Implementation Group; Provide and Enhance Recreational Opportunities, 91138-91140 2016-29952 He'eia National Estuarine Research Reserve Management Plan, 91137-91138 2016-30441 National Park National Park Service NOTICES Environmental Impact Statements; Availability, etc.: Presence of Wolves at Isle Royale National Park, MI, 91192-91193 2016-30247 Extension of Concession Contracts, 91196 2016-30248 Inventory Completions: Office of the State Archaeologist, University of Iowa, Iowa City, IA, 91195-91196 2016-30339 Seminole Tribe of Florida, Clewiston, FL, 91193-91195 2016-30335 St.

Joseph Museums, Inc., St. Joseph, MO, 91192 2016-30336 Thomas Burke Memorial Washington State Museum, University of Washington, Seattle, WA; Correction, 91196-91197 2016-30337 Repatriation of Cultural Items: Allen County-Fort Wayne Historical Society, Fort Wayne, IN, 91191-91192 2016-30338 Nuclear Regulatory Nuclear Regulatory Commission NOTICES Guidance: Program-Specific Guidance about Possession Licenses for Production of Radioactive Material Using an Accelerator, 91206-91207 2016-30343 Meetings;

Sunshine Act, 91207-91208 2016-30494 Occupational Safety Health Adm Occupational Safety and Health Administration NOTICES Expansion of Recognition; Applications: Intertek Testing Services NA, Inc., 91204-91206 2016-30287 Recognition; Applications: Bay Area Compliance Laboratories Corp., 91201-91204 2016-30288 Ocean Energy Management Ocean Energy Management Bureau NOTICES Atlantic Wind Lease Sales: Commercial Leasing for Wind Power on Outer Continental Shelf Offshore New York:

Final Sale Notice; Correction, 91197 2016-30352 Pension Benefit Pension Benefit Guaranty Corporation RULES Benefits Payable in Terminated Single-Employer Plans: Interest Assumptions for Paying Benefits, 91032-91033 2016-30098 Personnel Personnel Management Office NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 91208 2016-30316 Postal Regulatory Postal Regulatory Commission NOTICES New Postal Products, 91208-91209 2016-30239 Postal Service Postal Service NOTICES Product Changes:

First-Class Package Service Negotiated Service Agreement, 91210-91211 2016-30227 2016-30238 Priority Mail and First-Class Package Service Negotiated Service Agreement, 91210-91211 2016-30231 2016-30232 2016-30233 Priority Mail Express and Priority Mail Negotiated Service Agreement, 91209-91210 2016-30228 Priority Mail Negotiated Service Agreement, 2016-30234 2016-30235 91210-91211 2016-30236 2016-30237 Securities Securities and Exchange Commission NOTICES Applications: Alpha Architect ETF Trust, et al., 91215-91216 2016-30251 Self-Regulatory Organizations;

Proposed Rule Changes: Bats EDGX Exchange, Inc., 91235-91237 2016-30254 BOX Options Exchange LLC, 91227-91230 2016-30258 Depository Trust Co.; Fixed Income Clearing Corp.; National Securities Clearing Corp., 91232-91235 2016-30256 International Securities Exchange, LLC, 91221-91227 2016-30257 Investors Exchange LLC, 91211-91215 2016-30255 NASDAQ Stock Market LLC, 91216-91220 2016-30259 NYSE Arca, Inc., 91220-91221 2016-30252 NYSE MKT LLC, 91230-91232 2016-30253 Small Business Small Business Administration PROPOSED RULES Small Business Investment Companies—Administrative Fees, 91049-91058 2016-30104 Social Social Security Administration RULES Ensuring Program Uniformity at the Hearing and Appeals Council Levels of the Administrative Review Process, 90987-90997 2016-30103 Surface Transportation Surface Transportation Board NOTICES Discontinuance of Service Exemptions:

CSX Transportation, Inc. in Perry County, KY, 91237 2016-30275 Revisions to Arbitration Procedures, 91237-91238 2016-30249 Transportation Department Transportation Department See Federal Aviation Administration See Federal Motor Carrier Safety Administration See Federal Railroad Administration See Maritime Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Requirements for Establishing U.S. Citizenship, 91247-91248 2016-30200 Security Transportation Security Administration PROPOSED RULES Security Training for Surface Transportation Employees, 91336-91401 2016-28298 Surface Transportation Vulnerability Assessments and Security Plans, 91401-91416 2016-28300 Treasury Treasury Department See Comptroller of the Currency See Internal Revenue Service NOTICES Agency Information Collection Activities;

Proposals, Submissions, and Approvals, 91248-91249 2016-30260 Customs U.S. Customs and Border Protection NOTICES Commercial Gaugers and Laboratories; Accreditations and Approvals: Intertek USA, Inc., 91184-91185 2016-30297 Veteran Affairs Veterans Affairs Department NOTICES Meetings: Health Services Research and Development Service Scientific Merit Review Board, 91249 2016-30334 Separate Parts In This Issue Part II Commodity Futures Trading Commission, 91252-91334 2016-29368 Part III Homeland Security Department, Transportation Security Administration, 91336-91416 2016-28298 2016-28300 Part IV Energy Department, 91418-91452 2016-29077 Part V Commodity Futures Trading Commission, 91454-91492 2016-29582 Part VI Interior Department, Fish and Wildlife Service, 91494-91554 2016-29908 Part VII Defense Department, Engineers Corps, 91556-91590 2016-30017 Part VIII Environmental Protection Agency, 91592-91624 2016-30063 Part IX Defense Department, 91626-91642 2016-30091 2016-30092 2016-30089 2016-30090 General Services Administration, 2016-30091 91626-91642 2016-30092 2016-30089 2016-30090 National Aeronautics and Space Administration, 91626-91642 2016-30091 2016-30092 2016-30089 2016-30090 Reader Aids Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, and notice of recently enacted public laws.

To subscribe to the Federal Register Table of Contents electronic mailing list, go to https://public.govdelivery.com/accounts/USGPOOFR/subscriber/new, enter your e-mail address, then follow the instructions to join, leave, or manage your subscription. 81 242 Friday, December 16, 2016 Rules and Regulations DEPARTMENT OF TREASURY Office of the Comptroller of the Currency 12 CFR Part 4 [Docket ID OCC-2016-0001] RIN 1557-AE01 FEDERAL RESERVE SYSTEM 12 CFR Parts 208 and 211 [Docket No.

R-1531] RIN 7100-AE45 FEDERAL DEPOSIT INSURANCE CORPORATION 12 CFR Parts 337, 347, and 390 RIN 3064-AE42 Expanded Examination Cycle for Certain Small Insured Depository Institutions and U.S. Branches and Agencies of Foreign Banks AGENCY: Office of the Comptroller of the Currency (OCC), Treasury; Board of Governors of the Federal Reserve System (Board); and Federal Deposit Insurance Corporation (FDIC). ACTION: Joint final rules. SUMMARY: The OCC, Board, and FDIC (collectively, the agencies) are jointly adopting as final and without change the agencies' interim final rules published in the **Federal Register** on February 29, 2016, that implemented section 83001 of the Fixing America's Surface Transportation Act (FAST Act).

Section 83001 of the FAST Act permits the agencies to conduct a full-scope, on-site examination of qualifying insured depository institutions with less than $1 billion in total assets no less than once during each 18-month period. Prior to enactment of the FAST Act, only qualifying insured depository institutions with less than $500 million in total assets were eligible for an 18-month on-site examination cycle. The final rules, like the interim final rules, generally allow well capitalized and well managed institutions with less than $1 billion in total assets to benefit from the extended 18-month examination schedule.

In addition, the final rules adopt as final parallel changes to the agencies' regulations governing the on-site examination cycle for U.S. branches and agencies of foreign banks, consistent with the International Banking Act of 1978. Finally, through this rulemaking, the FDIC has integrated its regulations regarding the frequency of safety and soundness examinations for State nonmember banks and State savings associations. DATES: Effective on January 17, 2017. FOR FURTHER INFORMATION CONTACT: *OCC:* Deborah Katz, Assistant Director, or Melissa J.

Lisenbee, Attorney, Legislative and Regulatory Activities Division,

(202)649-5490; Scott Schainost, Midsize and Community Bank Supervision Liaison, Midsize and Community Bank Supervision,

(202)649-8173. *Board:* Division of Banking Supervision and Regulation—Richard Naylor, Associate Director,

(202)728-5854; Richard Watkins, Deputy Associate Director,

(202)452-3421; Virginia Gibbs, Manager,

(202)452-2521; or Alexander Kobulsky, Supervisory Financial Analyst,

(202)452-2031; and Legal Division—Laurie Schaffer, Associate General Counsel,

(202)452-2277; Brian Chernoff, Senior Attorney,

(202)452-2952; or Mary Watkins, Attorney,

(202)452-3722. *FDIC:* Thomas F. Lyons, Chief, Policy and Program Development,

(202)898-6850, Karen Jones Currie, Senior Examination Specialist,

(202)898-3981 for the Division of Risk Management Supervision; Mark A. Mellon, Counsel,

(202)898-3884 for revisions to 12 CFR part 337; Rodney D. Ray, Counsel,

(202)898-3556 for revisions to 12 CFR part 347; Suzanne J. Dawley, Senior Attorney,

(202)898-6509 for revisions to 12 CFR part 390 for the Legal Division. SUPPLEMENTARY INFORMATION: I. Background Section 10(d) of the Federal Deposit Insurance Act (FDI Act) 1 generally requires the appropriate Federal banking agency for an insured depository institution

(IDI)to conduct a full-scope, on-site examination of the institution at least once during each 12-month period. Prior to enactment of section 83001 of the FAST Act, 2 section 10(d)(4) of the FDI Act authorized the appropriate Federal banking agency to extend the on-site examination cycle for an IDI to at least once during an 18-month period if the IDI

(1)had total assets of less than $500 million;

(2)was well capitalized (as defined in 12 U.S.C. 1831o);

(3)was found, at its most recent examination, to be well managed 3 and to have a composite condition of “outstanding” or, in the case of an institution that has total assets of not more than $100 million, “outstanding” or “good;”

(4)was not subject to a formal enforcement proceeding or order by the FDIC or its appropriate Federal banking agency; and

(5)had not undergone a change in control during the previous 12-month period in which a full-scope, on-site examination otherwise would have been required. Section 10(d)(10) of the FDI Act, prior to the enactment of section 83001 of the FAST Act, also gave the agencies discretionary authority to raise the eligibility size limit for the 18-month examination cycle for otherwise qualifying IDIs with an “outstanding” or “good” composite rating from $100 million to an amount not to exceed $500 million in total assets if the agencies determined that the higher limit would be consistent with the principles of safety and soundness. 4 Under section 10(d)(3), the Board and the FDIC, as the appropriate Federal banking agencies for State-chartered insured banks and savings associations, are permitted to conduct on-site examinations of such IDIs on alternating 12-month or 18-month periods with the institution's State supervisor, if the Board or FDIC, as appropriate, determines that the alternating examination conducted by the State carries out the purposes of section 10(d) of the FDI Act. 5 1 12 U.S.C. 1820(d). Section 10(d) of the FDI Act was added by section 111 of the Federal Deposit Insurance Corporation Improvement Act of 1991. 2 Public Law 114-94, 129 Stat. 1312 (2015). 3 Depository institutions are evaluated under the Uniform Financial Institutions Rating System (commonly referred to as “CAMELS”). CAMELS is an acronym that is drawn from the first letters of the individual components of the rating system: Capital adequacy, Asset quality, Management, Earnings, Liquidity, and Sensitivity to market risk. CAMELS ratings of “1” and “2” correspond with ratings of “outstanding” and “good.” In addition to having a CAMELS composite rating of “1” or “2,” an IDI is considered to be “well managed” for the purposes of section 10(d) of the FDI Act only if the IDI also received a rating of “1” or “2” for the management component of the CAMELS rating at its most recent examination. See 72 FR 17798 (Apr. 10, 2007). 4 12 U.S.C. 1820(d)(10). 5 12 U.S.C. 1820(d)(3). Section 7(c)(1)(C) of the International Banking Act

(IBA)provides that a Federal or a State branch or agency of a foreign bank shall be subject to on-site examination by its appropriate Federal banking agency or State bank supervisor as frequently as a national or State bank would be subject to such an examination by the agency. 6 The agencies previously adopted regulations to implement the examination cycle requirements of section 10(d) of the FDI Act and section 7(c)(1)(C) of the IBA, including the extended 18-month examination cycle available to qualifying small institutions and U.S. branches and agencies of foreign banks. 7 The agencies have also exercised their discretion, under section 10(d)(10) of the FDI Act, to extend the 18-month examination cycle for otherwise qualifying institutions with “good” composite ratings, 8 first, in 1997, for such institutions with total assets of $250 million or less, and, again, in 2007, for such institutions with total assets of $500 million or less. 9 6 12 U.S.C. 3105(c)(1)(C). 7 See 12 CFR 4.6 and 4.7 (OCC), 12 CFR 208.64 and 211.26 (Board), 12 CFR 337.12, 347.211, and 390.351 (FDIC). 8 Corresponding to a CAMELS or *R* isk management, *O* perational controls, *C* ompliance, and *A* sset quality

(ROCA)rating of “2.” 9 See 62 FR 6449 (Feb. 12, 1997) (interim final rule); see also 63 FR 16377 (Apr. 2, 1998) (final rule); see also 72 FR 17798 (Apr. 10, 2007) (interim final rule); see also 72 FR 54347 (Sept. 25, 2007) (final rule). Section 83001 of the FAST Act, effective on December 4, 2015, amended section 10(d) of the FDI Act to raise, from $500 million to $1 billion, the total asset threshold below which an agency may apply an 18-month (rather than a 12-month) on-site examination cycle for IDIs with “outstanding” composite ratings, and to raise, from not more than $100 million to not more than $200 million, the total asset threshold below which an agency may apply an 18-month examination cycle to an institution with an “outstanding” or “good” composite rating. 10 Section 83001 also amended section 10(d)(10) of the FDI Act to authorize the appropriate Federal banking agency to increase, by regulation, the maximum amount limitation for IDIs with “outstanding” or “good” composite ratings from not more than $200 million to not more than $1 billion if the appropriate Federal banking agency determines that the higher amount would be consistent with the principles of safety and soundness for IDIs. 11 10 Public Law 114-94, 129 Stat. 1312 (2015). 11 *Id.* These FAST Act amendments reduce regulatory burdens on small, well capitalized, and well managed institutions and allow the agencies to better focus their supervisory resources on those IDIs and U.S. branches and agencies of foreign banks that may present capital, managerial, or other issues of supervisory concern. II. Discussion of the Final Rules On February 29, 2016, the agencies published and requested comment on interim final rules to implement the amendments to section 10(d) made by section 83001 of the FAST Act. 12 The agencies are adopting the interim final rules as final without change. In particular, the agencies are adopting as final the increase, from $500 million to $1 billion, in the total asset threshold below which an IDI that meets the criteria in section 10(d) and the agencies' rules may qualify for an 18-month, full-scope, on-site examination cycle. In addition, as authorized by section 83001 of the FAST Act, the agencies have determined that it is consistent with principles of safety and soundness to permit institutions with total assets of $200 million or greater and not exceeding $1 billion that received a composite CAMELS rating of “1” or “2,” and that meet other qualifying criteria set forth in section 10(d) and the agencies' rules, to qualify for an 18-month examination cycle. Consistent with section 7(c)(1)(C) of the IBA, the agencies also are adopting as final conforming changes to the regulations that govern the on-site examination cycle of a U.S. branch or agency of a foreign bank. These changes permit a U.S. branch or agency of a foreign bank with total assets of less than $1 billion to qualify for an 18-month examination cycle if the U.S. branch or agency of a foreign bank received a composite ROCA rating of “1” or “2” at its most recent examination and meets the other applicable criteria. 12 81 FR 10063 (Feb. 29, 2016). The FDIC analyzed the frequency with which institutions rated a composite CAMELS rating of “1” or “2” failed within five years, versus the frequency with which institutions rated a composite CAMELS rating of “3,” “4,” or “5” failed within five years. FDIC analysis indicates that between 1985 and 2011, 13 FDIC-insured depository institutions with assets less than $1 billion and a composite CAMELS rating of “1” or “2” had a five-year failure rate that was one-seventh as high as institutions with a CAMELS rating of “3,” “4,” or “5.” Moreover, the relationship between failure rates in the two ratings groups did not meaningfully change when the analysis was restricted to institutions with assets between $200 million and $500 million compared to institutions with assets between $500 million to $1 billion. This analysis suggests that extending the examination cycle for well-rated institutions with $500 million to $1 billion in assets by an additional six months, combined with the agencies' off-site monitoring activities and ability to examine an institution more frequently as necessary or appropriate, is unlikely to negatively affect the safe and sound operations of qualifying institutions or the ability of the agencies to effectively supervise and protect the safety and soundness of institutions with total assets of less than $1 billion. 14 Furthermore, the agencies note that, in order to qualify for an 18-month examination cycle, any institution with total assets of less than $1 billion—including one with a CAMELS composite rating of “2”—must meet the other capital, managerial, and supervisory criteria set forth in section 10(d). The agencies estimate that the changes adopted by the final rules will increase the number of institutions that may qualify for an extended 18-month examination cycle by approximately 611 institutions (372 of which are supervised by the FDIC, 142 by the OCC, and 97 by the Board), bringing the total number of institutions that may qualify for an extended 18-month examination cycle to 4,793 IDIs. 15 Approximately 89 U.S. branches and agencies of foreign banks would be eligible for the extended examination cycle based on the final rules, an increase of 30 (one of which is supervised by the FDIC, four by the OCC, and 25 by the Board). 16 13 A list of failed institutions can be found on the FDIC's Web site at *https://www.fdic.gov/bank/individual/failed/banklist.html.* 14 The agencies continue to reserve the right in their regulations to examine an IDI or U.S. branch or agency of a foreign bank more frequently than is required by the FDI Act or IBA. See 12 CFR 4.6(c) and 4.7(c) (OCC), 12 CFR 208.64(c) and 211.26(c)(3) (Board), 12 CFR 337.12(c), 347.211(c) (FDIC), and 390.351(c). 15 Call report data, March 31, 2016. 16 *Id.* Finally, the FDIC is adopting as final changes made in the interim final rules to integrate its regulations regarding the frequency of safety and soundness examinations for State nonmember banks and State savings associations. Twelve CFR 390.351 was rescinded and removed because it was substantively identical to 12 CFR 337.12 and, therefore, redundant to section 12 CFR 337.12. Twelve CFR 337.12 was amended to reflect the authority of the FDIC under section 4(a) of the Home Owners' Loan Act to provide for the examination and safe and sound operation of State savings associations. State savings associations now are within the scope of 12 CFR 337.12, and, all FDIC-supervised institutions, including State savings associations, are subject to the requirements of 12 CFR 337.12. The agencies received three comment letters in response to the interim final rules. Two commenters, both industry trade groups, supported the interim final rules. Both commenters agreed that extending the examination cycle for IDIs that meet the interim final rules' criteria would not negatively affect the safe and sound operations of the institutions or the ability of the agencies to supervise them. The third commenter, an individual, did not support the interim final rules, but offered no specific reasons for that opposition. For the reasons described in this section, the agencies are adopting these rules as final without change. Effective Date The Administrative Procedure Act

(APA)generally requires that a final rule be published in the **Federal Register** no less than 30 days before its effective date. 17 Therefore, the final rules will become effective on January 17, 2017. The interim final rules will continue to be in effect until the final rules become effective. 17 5 U.S.C. 553(d). Section 302 of the Riegle Community Development and Regulatory Improvement Act of 1994 (RCDRIA) requires that each Federal banking agency, in determining the effective date and administrative compliance requirements for new regulations that impose additional reporting, disclosures, or other requirements on IDIs, consider, consistent with principles of safety and soundness and the public interest, any administrative burdens that such regulations would place on depository institutions, including small depository institutions, and customers of depository institutions, as well as the benefits of such regulations. 18 Further, new regulations that impose additional reporting, disclosures, or other new requirements on IDIs generally must take effect on the first day of a calendar quarter that begins on or after the date on which the regulations are published in final form. 19 The final rules adopt the interim final rules without change. The RCDRIA does not apply to the final rules because the rules do not impose any additional reporting, disclosures, or other new requirements on IDIs. 18 12 U.S.C. 4802(a). 19 12 U.S.C. 4802(b). III. Regulatory Analysis A. Plain Language Section 722 of the Gramm-Leach-Bliley Act 20 requires the Federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. The agencies' staff believe the final rules are presented in a clear and straightforward manner and having received no comments on how to make the interim final rules easier to understand, the agencies adopt the final rules without change. 20 Pub. L. 106-102, section 722, 113 Stat. 1338, 1471 (1999). B. Regulatory Flexibility Act *Board:* Regulatory Flexibility Act 21

(RFA)requires an agency to prepare a final regulatory flexibility analysis

(FRFA)when an agency promulgates a final rule, unless pursuant to section 605(b) of the RFA, the agency certifies that the final rule will not, if promulgated, have a significant economic impact on a substantial number of small entities. In this context, small entities include banking entities with total assets less than or equal to $550 million. 21 5 U.S.C. 601 *et seq.* The final rules do not have a significant impact on a substantial number of small entities. Like the interim final rules, the final rules expand the number of institutions eligible for an extended examination cycle, thus reducing the regulatory burden associated with on-site examinations for these institutions. Further, only 22 of the 122 Board-regulated institutions affected by the final rules have assets between $500 million and $550 million and thus would be considered small entities. These 22 institutions represent a small percentage (3.3 percent) of the 657 Board-supervised institutions with total assets less than $550 million. 22 For these reasons, the Board certifies that the final rules will not have a significant impact on a substantial number of small entities as defined in the RFA, 23 and therefore, a regulatory flexibility analysis is not required. 22 Call report data, March 31, 2016. 23 5 U.S.C. 601 *et seq.* *FDIC:* The RFA 24 requires an agency, in connection with a notice of final rulemaking, to prepare a FRFA analysis describing the impact of the rule on small entities (defined by the Small Business Administration for the purposes of the RFA to include banking entities with total assets of $550 million or less) or to certify that the final rule will not have a significant economic impact on a substantial number of small entities. 24 Id. The final rule does not impose any significant economic impact on a substantial number of small entities. The final rule raises the asset eligibility threshold for extended examination cycles from $500 million to $1 billion, expanding the number of qualifying institutions and U.S. branches and agencies of foreign banks, and reduces the regulatory burden associated with on-site examinations. Of the 372 FDIC-supervised institutions that could be impacted by the rule, only 71 of the FDIC-supervised institutions have total assets between $500 million and $550 million which is a very small share (2.5 percent) of the 2,817 FDIC-supervised institutions with total assets less than $550 million. 25 For this reason, the FDIC certifies that the final rule will not have a significant economic impact on a substantial number of small entities as defined in the RFA, and therefore, a regulatory flexibility analysis is not required. 25 Call report data, March 31, 2016. *OCC:* The RFA applies only to rules for which an agency publishes a general notice of proposed rulemaking pursuant to 5 U.S.C. 553(b). Consistent with section 553(b)(B) of the APA, the agencies determined for good cause that general notice and opportunity for public comment were not necessary and issued an interim final rule rather than a proposed rule. Accordingly, the RFA's requirements relating to initial and final regulatory flexibility analyses do not apply. C. Paperwork Reduction Act The Paperwork Reduction Act of 1995 26 states that no agency may conduct or sponsor, nor is the respondent required to respond to, an information collection unless it displays a currently valid Office of Management and Budget

(OMB)control number. Because the final rules do not create a new, or revise an existing collection of information, no information collection submission needs to be made to OMB. 26 44 U.S.C. 3501-3521. D. The Economic Growth and Regulatory Paperwork Reduction Act Under section 2222 of the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA), 27 the agencies are required to conduct a review at least once every 10 years to identify any outdated or otherwise unnecessary regulations. The agencies completed the last comprehensive review of their regulations under EGRPRA in 2006 and are currently conducting the next decennial review. The burden reduction evidenced in these final rules is consistent with the objectives of the EGRPRA review process. 27 Public Law 104-208, 110 Stat. 3309 (1996). Authority and Issuance For the reasons set forth in the joint preamble, the interim rule published on February 29, 2016 at 81 FR 10063, is adopted as final without change. Dated: October 19, 2016. Thomas J. Curry, Comptroller of the Currency. Board of Governors of the Federal Reserve System, December 6, 2016. Robert deV. Frierson, Secretary of the Board. Dated at Washington, DC, this 19th day of October 2016. By order of the Board of Directors. Federal Deposit Insurance Corporation. Robert E. Feldman, Executive Secretary. [FR Doc. 2016-30133 Filed 12-15-16; 8:45 am]

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