[Federal Register: May 11, 2006 (Volume 71, Number 91)]
[Rules and Regulations]
[Page 27405-27408]
[DOCID:fr11my06-5]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 271

[EPA-R04-RCRA-2006-0429; FRL-8168-4]

Tennessee: Final Authorization of State Hazardous Waste
Management Program Revisions

AGENCY: Environmental Protection Agency (EPA).

ACTION: Immediate final rule.

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SUMMARY: Tennessee has applied to EPA for final authorization of the
changes to its hazardous waste program under the Resource Conservation
and Recovery Act (RCRA). EPA proposes to grant Final authorization to
Tennessee. In the

``Rules and Regulations'' section of this Federal Register, EPA is
authorizing the changes by an immediate final rule. EPA did not make a
proposal prior to the immediate final rule because we believe this
action is not controversial and do not expect comments that oppose it.
We have explained the reasons for this authorization in the preamble of
the immediate final rule. Unless we get written comments which oppose
this authorization during the comment period, the immediate final rule
will become effective on the date it establishes, and we will not take
further action on this proposal. If we receive comments that oppose
this action, we will withdraw the immediate final rule and it will not
take effect. We will respond to public comments in a later final rule
based on this proposal. You may not have another opportunity for
comment.

DATES: Final authorization will become effective on July 10, 2006
unless EPA receives adverse written comment on or before June 12, 2006.
If EPA receives such comment, it will publish a timely withdrawal of
this immediate final rule in the Federal Register and inform the public
that this authorization will not take effect.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
RCRA-2006-0429 by one of the following methods:
     http://www.regulations.gov: Follow the on-line

instructions for submitting comments.
     E-mail<EMAIL_ADDRESS>     Fax:<PHONE_NUMBER> (prior to faxing, please notify the
EPA contact listed below)
     Mail: Send written comments to Gwen Gleaton, RCRA Services
Section, RCRA Programs Branch, Waste Management Division, U.S.
Environmental Protection Agency, The Sam Nunn Atlanta Federal Center,
61 Forsyth Street, SW., Atlanta, Georgia 30303-8960.
     Hand Delivery: Gwen Gleaton, RCRA Services Section, RCRA
Programs Branch, Waste Management Division, U.S. Environmental
Protection Agency, The Sam Nunn Atlanta Federal Center, 61 Forsyth
Street, SW., Atlanta, Georgia 30303-8960. Such deliveries are only
accepted during the office's normal hours of operation, and special
arrangements should be made for deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-R04-RCRA-
2006-0429. 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. (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 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. You may view and copy

Tennessee's application at The EPA Region 4, Library, The Sam Nunn
Atlanta Federal Center, 61 Forsyth Street, SW., Atlanta, Georgia 30303-
8960. The Library is open from 8:30 a.m. to 4 p.m. Monday through
Friday, excluding legal holidays. The Library telephone number is (404)
562-8190.
    You may also view and copy Tennessee's application from 8 a.m. to
4:30 p.m. at the following address: Tennessee Department of Environment
and Conservation, Division of Solid Waste Management, 5th Floor, L & C
Tower, 401 Church Street, Nashville, Tennessee 37243-1535.

FOR FURTHER INFORMATION CONTACT: Gwen Gleaton, RCRA Services Section,
RCRA Programs Branch, Waste Management Division, EPA Region 4, The Sam
Nunn Atlanta Federal Center, 61 Forsyth Street, SW., Atlanta, Georgia
30303-8960;<PHONE_NUMBER>; fax number:<PHONE_NUMBER>; e-mail address:
<EMAIL_ADDRESS>

SUPPLEMENTARY INFORMATION:

A. Why Are Revisions to State Programs Necessary?

    States which have received Final authorization from EPA under RCRA
section 3006(b), 42 U.S.C. 6926(b), must maintain a hazardous waste
program that is equivalent to, consistent with, and no less stringent
than the Federal program. As the Federal program changes, States must
change their programs and ask EPA to authorize the changes. Changes to
State programs may be necessary when Federal or State statutory or
regulatory authority is modified or when certain other changes occur.
Most commonly, States must change their programs because of changes to
EPA's regulations in 40 Code of Federal Regulations (CFR) parts 124,
260 through 266, 268, 270, 273 and 279.

B. What Decisions Have We Made in This Rule?

    We conclude that Tennessee's application to revise its authorized
program meets all of the statutory and regulatory requirements
established by RCRA. Therefore, we grant Tennessee Final authorization
to operate its hazardous waste program with the changes described in
the authorization application. Tennessee has responsibility for
permitting Treatment, Storage, and Disposal Facilities within its
borders and for carrying out the aspects of the RCRA program described
in its revised program application, subject to the limitations of the
Hazardous and Solid Waste Amendments of 1984 (HSWA). New Federal
requirements and prohibitions imposed by Federal regulations that EPA
promulgates under the authority of HSWA take effect in authorized
States before they are authorized for the requirements. Thus, EPA will
implement those requirements and prohibitions in Tennessee, including
issuing permits, until the State is granted authorization to do so.

C. What Is the Effect of This Authorization Decision?

    The effect of this decision is that a facility in Tennessee subject
to RCRA will now have to comply with the authorized State requirements
instead of the equivalent Federal requirements in

order to comply with RCRA. Tennessee has enforcement responsibilities
under its State hazardous waste program for violations of such program,
but EPA retains its authority under RCRA sections 3007, 3008, 3013, and
7003, which include, among others, authority to:
     Perform inspections, and require monitoring, tests,
analyses or reports.
     Enforce RCRA requirements and suspend or revoke permits.
     Take enforcement actions regardless of whether the State
has taken its own actions.
    This action does not impose additional requirements on the
regulated community because the regulations for which Tennessee are
being authorized by today's action are already effective, and are not
changed by today's action.

D. Why Wasn't There a Proposed Rule Before This Rule?

    EPA did not publish a proposal before today's rule because we view
this as a routine program change and do not expect comments that oppose
this approval. We are providing an opportunity for public comment now.
In addition to this rule, in the proposed rules section of today's
Federal Register, we are publishing a separate document that proposes
to authorize the State program changes.

E. What Happens if EPA Receives Comments That Oppose This Action?

    If EPA receives comments that oppose this authorization, we will
withdraw this rule by publishing a document in the Federal Register
before the rule becomes effective. EPA will base any further decision
on the authorization of the State program changes on the proposal
mentioned in the previous paragraph. We will then address all public
comments in a later final rule. You may not have another opportunity to
comment. If you want to comment on this authorization, you must do so
at this time.
    If we receive comments that oppose only the authorization of a
particular change to the State hazardous waste program, we will
withdraw that part of this rule but the authorization of the program
changes that the comments do not oppose will become effective on the
date specified above. The Federal Register withdrawal document will
specify which part of the authorization will become effective, and
which part is being withdrawn.

F. What Has Tennessee Previously Been Authorized For?

    Tennessee initially received final authorization on January 22,
1985, effective February 5, 1985 (50 FR 2820) to implement the RCRA
hazardous waste management program. We granted authorization for
changes to Tennessee's program on March 14, 2005, effective May 13,
2005 (70 FR 12416), April 11, 2003, effective June 10, 2003 (68 FR
17748), December 26, 2001, effective February 25, 2002 (66 FR 66342),
October 26, 2000, effective December 26, 2000 (65 FR 64161), September
15, 1999, effective November 15, 1999 (64 FR 49998), January 30, 1998,
effective March 31, 1998 (63 FR 45870), on May 23, 1996, effective July
22, 1996 (61 FR 25796), on August 24, 1995, effective October 23, 1995
(60 FR 43979), on May 8, 1995, effective July 7, 1995 (60 FR 22524), on
June 1, 1992, effective July 31, 1992 (57 FR 23063), and on June 12,
1987, effective August 11, 1987 (52 FR 22443).

G. What Changes Are We Authorizing With This Action?

    On January 12, 2006, Tennessee submitted a final complete program
revision application, seeking authorization of its changes in
accordance with 40 CFR 271.21. We now make an immediate final decision,
subject to receipt of comments that oppose this action, that
Tennessee's hazardous waste program revision satisfies all of the
requirements necessary to qualify for Final authorization. Therefore,
we grant final authorization for the following program changes:

------------------------------------------------------------------------
    Description of federal       Federal Register     Analogous state
          requirement             date and page        authority \1\
------------------------------------------------------------------------
203--Recycled Used Oil          68 FR 44659, 07/   Tennessee Revised
 Management Standards;           30/03.             Code 1200-1-11-
 Clarification.                                     .02(1)(e)10,
                                                    .11(2)(a),
                                                    .11(2)(a)9,
                                                    .11(8)(e),
                                                    .11(8)(e)2,
                                                    .11(8)(e)2(i)-(iv).
204--Performance Track........  69 FR 21737, 04/   Tennessee Revised
                                 22/04.             Code 1200-1-11-
                                                    .03(4)(e),
                                                    .03(4)(e)13,
                                                    .03(4)(e)13(i)-(ix),
                                                    .03(4)(e)13(ii)(I)-(
                                                    IV),
                                69 FR 62217, 10/   .03(4)(e)13(i)-(iii)(
                                 25/04.             I)-(IV),
                                                    .03(4)(e)13(v)(I)-(I
                                                    I),
                                                    .03(4)(e)13(ix)(I)-(
                                                    IV), .03(4)(e)14-15.
205--NESHAP: Surface Coating    69 FR 22601, 04/   Tennessee Revised
 of Automobiles and Light-Duty   26/04.             Code 1200-1-11-
 Trucks.                                            .06(31)(a),
                                                    .06(31)(a)8,
                                                    .05(28)(a),
                                                    .05(28)(a)7.
------------------------------------------------------------------------
\1\ The Tennessee provisions are from the Tennessee Hazardous Waste
  Management Regulations effective August 23, 2005.

H. Where Are the Revised State Rules Different From the Federal Rules?

    There are no State requirements that are more stringent or broader
in scope than the Federal requirements.

I. Who Handles Permits After the Authorization Takes Effect?

    Tennessee will issue permits for all the provisions for which it is
authorized and will administer the permits it issues. EPA will continue
to administer any RCRA hazardous waste permits or portions of permits
which we issued prior to the effective date of this authorization until
they expire or are terminated. We will not issue any more permits or
new portions of permits for the provisions listed in the Table above
after the effective date of this authorization. EPA will continue to
implement and issue permits for HSWA requirements for which Tennessee
is not authorized.

J. What Is Codification and Is EPA Codifying Tennessee's Hazardous
Waste Program as Authorized in This Rule?

    Codification is the process of placing the State's statutes and
regulations that comprise the State's authorized hazardous waste
program into the Code of Federal Regulations. We do this by referencing
the authorized State rules in 40 CFR part 272. We reserve the amendment
of 40 CFR part 272, subpart RR for this authorization of Tennessee's
program changes until a later date.

K. Administrative Requirements

    The Office of Management and Budget has exempted this action from
the requirements of Executive Order 12866 (58 FR 51735, October 4,
1993), and therefore this action is not subject to review by OMB. This
action authorizes State requirements for the purpose of RCRA 3006 and
imposes no additional requirements beyond those imposed by State law.
Accordingly, I certify that this

action will not have a significant economic impact on a substantial
number of small entities under the Regulatory Flexibility Act (5 U.S.C.
601 et seq.). Because this action authorizes 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).
For the same reason, this action also does not significantly or
uniquely affect the communities of Tribal governments, as specified by
Executive Order 13175 (65 FR 67249, November 9, 2000). This action will
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),
because it merely authorizes State requirements as part of the State
RCRA hazardous waste program without altering the relationship or the
distribution of power and responsibilities established by RCRA. This
action also is not subject to Executive Order 13045 (62 FR 19885, April
23, 1997), because it is not economically significant and it does not
make decisions based on environmental health or safety risks. This rule
is not subject to Executive Order 13211, ``Actions Concerning
Regulations That Significantly Affect Energy Supply, Distribution, or
Use'' (66 FR 28355 (May 22, 2001)) because it is not a significant
regulatory action under Executive Order 12866.
    Under RCRA 3006(b), EPA grants a State's application for
authorization as long as the State meets the criteria required by RCRA.
It would thus be inconsistent with applicable law for EPA, when it
reviews a State authorization application, to require the use of any
particular voluntary consensus standard in place of another standard
that otherwise satisfies the requirements of RCRA. 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. As required
by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996),
in issuing this rule, EPA has taken the necessary steps to eliminate
drafting errors and ambiguity, minimize potential litigation, and
provide a clear legal standard for affected conduct. EPA has complied
with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining
the takings implications of the rule in accordance with the ``Attorney
General's Supplemental Guidelines for the Evaluation of Risk and
Avoidance of Unanticipated Takings'' issued under the executive order.
This rule does not impose an information collection burden under the
provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et
seq.).
    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this document 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 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). This
action will be effective July 10, 2006.

List of Subjects in 40 CFR Part 271

    Environmental protection, Administrative practice and procedure,
Confidential business information, Hazardous materials transportation,
Hazardous waste, Indians-lands, Intergovernmental relations, Penalties,
Reporting and recordkeeping requirements.

    Authority: This action is issued under the authority of sections
2002(a), 3006, and 7004(b), of the Solid Waste Disposal Act, as
amended, 42 U.S.C. 6912(a), 6926, and 6974(b).

    Dated: April 25, 2006.
A. Stanley Meiburg,
Deputy Regional Administrator, Region 4.
[FR Doc. 06-4397 Filed 5-10-06; 8:45 am]

BILLING CODE 6560-50-P


[Federal Register: August 3, 2009 (Volume 74, Number 147)]
[Notices]
[Page 38464]
[DOCID:fr03au09-86]

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Internal Agency Docket No. FEMA-1848-DR; Docket ID FEMA-2008-0018]

Kansas; Amendment No. 1 to Notice of a Major Disaster Declaration

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Notice.

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SUMMARY: This notice amends the notice of a major disaster declaration
for the State of Kansas (FEMA-1848-DR), dated June 24, 2009, and
related determinations.

DATES: Effective Date: July 24, 2009.

FOR FURTHER INFORMATION CONTACT: Peggy Miller, Disaster Assistance
Directorate, Federal Emergency Management Agency, 500 C Street, SW.,
Washington, DC 20472,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: The notice of a major disaster declaration
for the State of Kansas is hereby amended to include the following area
among those areas determined to have been adversely affected by the
event declared a major disaster by the President in his declaration of
June 24, 2009.

    Morris County for Public Assistance.

    The following Catalog of Federal Domestic Assistance Numbers
(CFDA) are to be used for reporting and drawing funds: 97.030,
Community Disaster Loans; 97.031, Cora Brown Fund; 97.032, Crisis
Counseling; 97.033, Disaster Legal Services; 97.034, Disaster
Unemployment Assistance (DUA); 97.046, Fire Management Assistance
Grant; 97.048, Disaster Housing Assistance to Individuals and
Households in Presidentially Declared Disaster Areas; 97.049,
Presidentially Declared Disaster Assistance--Disaster Housing
Operations for Individuals and Households; 97.050, Presidentially
Declared Disaster Assistance to Individuals and Households--Other
Needs; 97.036, Disaster Grants--Public Assistance (Presidentially
Declared Disasters); 97.039, Hazard Mitigation Grant.

W. Craig Fugate,
Administrator, Federal Emergency Management Agency.
[FR Doc. E9-18409 Filed 7-31-09; 8:45 am]

BILLING CODE 9111-23-P


[Federal Register Volume 84, Number 70 (Thursday, April 11, 2019)]
[Notices]
[Pages 14715-14717]
[FR Doc No: 2019-07132]

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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

[Docket No. PHMSA-2019-0047]

Pipeline Safety: Potential for Damage to Pipeline Facilities
Caused by Flooding, River Scour, and River Channel Migration

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA);
DOT.

ACTION: Notice; issuance of advisory bulletin.

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SUMMARY: PHMSA is issuing this advisory bulletin to remind all owners
and operators of gas and hazardous liquid pipelines of the potential
for damage to pipeline facilities caused by severe flooding and actions
that operators should consider taking to ensure the integrity of
pipelines in the event of flooding, river scour, and river channel
migration.

FOR FURTHER INFORMATION CONTACT: Operators of pipelines subject to
regulation by PHMSA should contact the appropriate PHMSA Region Office.
The PHMSA Region Offices and their contact information are as follows:

 Eastern Region:<PHONE_NUMBER>
    Connecticut, Delaware, District of Columbia, Maine, Maryland,
Massachusetts, New Hampshire, New Jersey, New York, Ohio, Pennsylvania,
Rhode Island, Vermont, Virginia, and West Virginia
 Southern Region:<PHONE_NUMBER>
    Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina,
Puerto Rico, South Carolina, and Tennessee
 Central Region:<PHONE_NUMBER>
    Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri,
Nebraska, North Dakota, South Dakota, and Wisconsin
 Southwest Region:<PHONE_NUMBER>
    Arkansas, Louisiana, New Mexico, Oklahoma, and Texas
 Western Region:<PHONE_NUMBER>
    Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana,
Nevada, Oregon, Utah, Washington, and Wyoming

    Intrastate pipeline operators should contact the appropriate state
pipeline safety authority. A list of state pipeline safety authorities
is available at www.napsr.org.

SUPPLEMENTARY INFORMATION:

I. Background

    Severe flooding, river scour, and river channel migration are the
types of unusual operating conditions that can adversely affect the
safe operation of a pipeline and require corrective action under the
Federal pipeline safety regulations.
    Section 192.613(a) of the pipeline safety regulations (49 CFR parts
190-199) states that ``[e]ach operator shall have a procedure for
continuing surveillance of its facilities to determine and take
appropriate action concerning changes in class location, failures,
leakage history, corrosion, substantial changes in cathodic protection
requirements, and other unusual operating and maintenance conditions.''
Section 192.613(b) further states that ``[i]f a segment of pipeline is
determined to be in unsatisfactory condition but no immediate hazard
exists, the operator shall initiate a program to recondition or phase
out the segment involved, or, if the segment cannot be reconditioned or
phased out, reduce the maximum allowable operating pressure in
accordance with Sec.  192.619(a) and (b).''
    Likewise, Sec.  195.401(b)(1) states that ``[w]henever an operator
discovers any condition that could adversely affect the safe operation
of its pipeline system, it must correct the condition within a
reasonable time. However, if the condition is of such a nature that it
presents an immediate hazard to persons or property, the operator may

not operate the affected part of the system until it has corrected the
unsafe condition.'' Section 195.401(b)(2) further states that ``[w]hen
an operator discovers a condition on a pipeline covered under [the
integrity management requirements in] Sec.  195.452, the operator must
correct the condition as prescribed in Sec.  195.452(h).''
    Operators should be aware that severe flooding, river scour, and
river channel migration may create unusual operating conditions that
can adversely affect the safe operation of a pipeline, and may require
corrective action under Sec. Sec.  192.613(a) and (b) and 195.401(b).
    In addition, Sec.  194.107(a) requires operators of onshore oil
pipelines to create response plans that ``include procedures and a list
of resources for responding, to the maximum extent practicable, to a
worst-case discharge and to a substantial threat of such a discharge.''
Section 194.115 further states that ``[e]ach operator shall identify,
and ensure, by contract or other approved means, the resources
necessary to remove, to the maximum extent practicable, a worst-case
discharge and to mitigate or prevent a substantial threat of a worst-
case discharge.''
    Furthermore, Sec. Sec.  192.935, 194.107, and 195.452(i) require an
operator to take additional preventative and mitigative measures to
prevent a pipeline failure and to mitigate the consequences of a
pipeline failure. An operator must base the additional measures on the
threats the operator has identified for each pipeline segment. If an
operator determines outside force damage (e.g., earth movement, floods)
is a threat to the pipeline, the operator must take steps to minimize
the probability of damage and the consequences of a release under these
regulations.
    In December of 2017, the American Petroleum Institute (API) issued
the second edition of Recommended Practice (RP) 1133, ``Managing
Hydrotechnical Hazards for Pipelines Located Onshore or Within Coastal
Areas.'' This RP applies to new and existing hydrocarbon pipelines that
transport gas and hazardous liquids. It is intended to apply to onshore
waterways and coastal zones that may be susceptible to hydro technical
hazards. The RP provides guidelines and recommendations for
identifying, assessing and managing risks to pipeline integrity
associated with these hazards through the life-cycle of a pipeline.
    PHMSA has released several advisory bulletins on this subject, with
the earliest issued July 29, 1993, (ADB-93-03), and the most recent on
January 19, 2016, (ADB-16-01; 81 FR 2944). These advisory bulletins are
consistent with API RP 1133. Each of these advisory bulletins followed
an event that involved severe flooding that affected pipelines in the
areas of rising or fast moving waters. As shown in these events, river
bottom scour, channel migration, and some cases soil subsidence, may
occur due to seasonal flooding, increased stream velocities, and man-
made and natural river bank restrictions. River scour and channel
migration may damage a pipeline as a result of additional stresses
imposed on the pipe by undermining underlying support soils, exposing
the pipeline to lateral water forces, and impact from waterborne
debris. Soil subsidence, particularly in variable, steep, and rugged
terrain, can pose a threat to the integrity of a pipeline if those
threats are not mitigated. Lateral water forces may cause excessive
bending loads that lead to pipeline failures, and possible impact
forces from debris in the river or harmonic vibrations from water
rapidly passing over pipelines can also increase the potential for
pipeline failures.
    Additionally, the safety of valves, regulators, relief sets,
pressure sensors, and other facilities normally above ground or above
water can be jeopardized when covered by water. Not only can these
facilities become inoperable when submerged, but they are also at a
greater risk of damage by outside forces, floating debris, river
currents, and craft operating on the water. Boaters involved in rescue
operations, emergency support functions, sightseeing, and other
activities are generally not aware of the seriousness of an incident
that could result from their craft damaging a pipeline facility that is
unseen beneath the surface of the water. Depending on the size of the
craft and the pipeline facility struck, significant pipeline damage may
result.
    Although accidents at river crossings account for less than one
percent of the total number of pipeline accidents, the consequences of
a release in water can be much more severe because of the threats to
drinking water supplies and the environment. Unlike hazardous liquid
releases on land where it can be easier to respond to and contain
spills, swift-moving river currents will carry hazardous liquids
further downstream, potentially impacting much larger geographical
areas and more communities. Product releases in rivers can create
difficult, costly, and lengthy spill response and remediation scenarios
and activities for operators, communities, and local, state, and
federal responders.

II. Advisory Bulletin (ADB-2019-01)

    To: Owners and Operators of Gas and Hazardous Liquid Pipeline
Systems.
    Subject: Potential for Damage to Pipeline Facilities Caused by
Severe Flooding.
    Advisory: Severe flooding can adversely affect the safe operation
of a pipeline. Operators should direct their resources in a manner that
will enable them to determine and mitigate the potential effects of
flooding on their pipeline systems in accordance with applicable
regulations. Operators are suggested to take the following actions to
prevent and mitigate damage to pipeline facilities and ensure public
and environmental safety in areas affected by flooding:
    1. Utilize experts in river flow, such as hydrologists or fluvial
geomorphologists, to evaluate a river's potential for scour or channel
migration at each pipeline river crossing.
    2. Evaluate each pipeline crossing a river to determine the
pipeline's installation method and determine if that method (and the
pipeline's current condition) is sufficient to withstand the risks
posed by anticipated flood conditions, river scour, or river channel
migration. In areas prone to these conditions and risks, consider
installing pipelines using horizontal directional drilling to help
place pipelines below elevations of maximum scour and outside the
limits of lateral channel migration.
    3. Determine the maximum flow or flooding conditions at rivers
where pipeline integrity is at risk in the event of flooding (e.g.,
where scour can occur) and have contingency plans to shut down and
isolate those pipelines when those conditions occur.
    4. Ensure that pipeline controllers are aware of which pipeline
sections are experiencing flooding or high flow conditions, and are
familiar with the contingency plans to safely and quickly shut down and
isolate the affected sections.
    5. Evaluate the accessibility of pipeline facilities and components
that may be in jeopardy, such as valve settings, which are needed to
isolate water crossings or other sections of pipelines.
    6. Extend regulator vents and relief stacks above the level of
anticipated flooding as appropriate.
    7. Coordinate with emergency and spill responders on pipeline
locations, crossing conditions, and the commodities transported.
Provide maps and other relevant information to such responders so they
can develop appropriate response strategies.

    8. Coordinate with other pipeline operators in flood areas and
establish emergency response centers to act as a liaison for pipeline
problems and solutions.
    9. Deploy personnel so that they will be in position to shut down,
isolate, contain, or perform any other emergency action on an affected
pipeline.
    10. Determine if facilities that are normally above ground (e.g.,
valves, regulators, relief sets, etc.) have become submerged and are in
danger of being struck by vessels or debris and, if possible, mark such
facilities with U.S. Coast Guard approval and an appropriate buoy.
    11. Perform frequent patrols, including appropriate overflights, to
evaluate right-of-way conditions at water crossings during flooding and
after waters subside. Report any flooding, either localized or
systemic, to integrity staff to determine if pipeline crossings may
have been damaged or would be in imminent jeopardy from future
flooding.
    12. Have open communications with local and state officials to
address their concerns regarding observed pipeline exposures, localized
flooding, ice dams, debris dams, and extensive bank erosion that may
affect the integrity of pipeline crossings.
    13. Following flooding, and when safe river access is first
available, determine if flooding has exposed or undermined pipelines
because of new river channel profiles. This is best done by a depth of
cover survey.
    14. Where appropriate, surveys of underwater pipe should include
the use of visual inspection by divers or instrumented detection.
Pipelines in recently flooded lands adjacent to rivers should also be
evaluated to determine the remaining depth of cover. You should share
information gathered by these surveys with affected landowners.
Agricultural agencies may help to inform farmers of potential hazards
from reduced cover over pipelines.
    15. Ensure that line markers are still in place or are replaced in
a timely manner. Notify contractors, highway departments, and others
involved in post-flood restoration activities of the presence of
pipelines and the risks posed by reduced cover.
    If a pipeline has suffered damage or is shut-in as a precautionary
measure due to flooding, the operator should advise the appropriate
PHMSA regional office or state pipeline safety authority before
returning the line to service, increasing its operating pressure, or
otherwise changing its operating status. Furthermore, reporting a
safety-related condition as prescribed in Sec. Sec.  191.23 and 195.55
may also be required.

    Issued in Washington, DC, on April 5, 2019, under authority
delegated in 49 CFR 1.97.
Alan K. Mayberry,
Associate Administrator for Pipeline Safety.
[FR Doc. 2019-07132 Filed 4-10-19; 8:45 am]
BILLING CODE 4910-60-P


[Federal Register Volume 82, Number 66 (Friday, April 7, 2017)]
[Notices]
[Pages 17017-17023]
[FR Doc No: 2017-07020]

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Docket ID FEMA-2017-2012]

National Flood Insurance Program (NFIP); Assistance to Private
Sector Property Insurers, Notice of FY 2018 Arrangement

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Notice.

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SUMMARY: The Federal Emergency Management Agency announces the Fiscal
Year 2018 Financial Assistance/Subsidy Arrangement for private property
insurers interested in participating in the National Flood Insurance
Program's Write Your Own program.

DATES: Interested insurers must submit intent to subscribe or re-
subscribe to the Arrangement by July 6, 2017.

FOR FURTHER INFORMATION CONTACT: Kelly Bronowicz, Federal Insurance and
Mitigation Administration, FEMA, 400 C St. SW., Washington, DC 20472;
(202) 557-9488 (phone), or<EMAIL_ADDRESS>(email).

SUPPLEMENTARY INFORMATION:

I. Background

    The National Flood Insurance Act of 1968 (NFIA), as amended (42
U.S.C. 4001 et seq.), authorizes the Administrator of the Federal
Emergency Management Agency (FEMA) to establish and carry out a
National Flood Insurance Program (NFIP) to enable interested persons to
purchase insurance against loss resulting from physical damage to or
loss of real or personal property arising from flood in the United
States. See 42 U.S.C. 4011(a). Under the NFIA, FEMA has the authority
to undertake arrangements to carry out the NFIP through the facilities
of the Federal government, utilizing, for the purposes of providing
flood insurance coverage, insurance companies and other insurers,
insurance agents and brokers, and insurance adjustment organizations,
as fiscal agents of the United States. See 42 U.S.C. 4071. To this end,
FEMA is authorized to ``enter into any contracts, agreements, or other
arrangements'' with private insurance companies to utilize their
facilities and services in administering the NFIP, and on such terms
and conditions as may be agreed upon. See 42 U.S.C. 4081(a).
    Pursuant to this authority, FEMA enters into a standard Financial
Assistance/Subsidy Arrangement (Arrangement) with private sector
property insurers, also known as Write Your Own (WYO) companies, to
sell NFIP flood insurance policies under their own names and adjust and
pay claims arising under the Standard Flood Insurance Policy (SFIP).
Each Arrangement entered into by a WYO company must be in the form and
substance of the standard Arrangement, a copy of which is published in
the Federal Register annually, at least 6 months prior to becoming
effective. See 44 CFR 62.23(a).

II. Notice of Availability

    Insurers interested in participating in the WYO Program for Fiscal
Year 2018 must contact Clark Poland at<EMAIL_ADDRESS>by
July 6, 2017.\1\
---------------------------------------------------------------------------

    \1\ Article V.B of the FY 2017 Arrangement requires current WYO
companies to notify FEMA of their ``intent to re-subscribe or not
re-subscribe'' to the WYO Program within 30 days of FEMA publishing
the terms of subscription or re-subscription in the Federal
Register. This notice constitutes publication of the terms
subscription for the purpsoses of Article V.B. However, FEMA is
extending the deadline for current WYO companies to notify FEMA of
their intent to re-subscribe or not re-subscribe to the Arrangment
to July 6, 2017.
---------------------------------------------------------------------------

    Prior participation in the WYO Program does not guarantee that FEMA
will approve continued participation. FEMA will evaluate requests to
participate in light of publicly available information, industry
performance data, and other criteria listed in 44 CFR 62.24 and the FY
2018 Arrangement, copied below. Private insurance companies are
encouraged to supplement this information with customer satisfaction
surveys, industry awards or recognition, or other objective performance
data. In addition, private insurance companies should work with their
vendors and subcontractors involved in servicing and delivering their
insurance lines to ensure FEMA receives the information necessary to
effectively evaluate the criteria set forth in its regulations.
    FEMA will send a copy of the offer for the FY 2018 Arrangement,
together with related materials and submission instructions, to all
private insurance companies successfully evaluated by the NFIP. If
FEMA, after conducting its evaluation, chooses not to renew a Company's
participation, FEMA, at its option, may require the continued
performance of all or selected elements of the FY 2017 Arrangement for
a period required for orderly transfer or cessation of the business and
settlement of accounts, not to exceed 18 months. See FY 2017
Arrangement, Article V.C. All evaluations, whether successful or
unsuccessful, will inform both an

overall assessment of the WYO Program and any potential changes FEMA
may consider regarding the Arrangement in future fiscal years.
    Any private insurance company with questions may contact FEMA at:
Kelly Bronowicz, Federal Insurance and Mitigation Administration, FEMA,
400 C St. SW., Washington, DC 20472 (mail);<PHONE_NUMBER> (phone), or
<EMAIL_ADDRESS>(email).

III. Fiscal Year 2018 Arrangement

    Pursuant to 44 CFR 62.23(a), FEMA must publish the Arrangement at
least 6 months prior to the Arrangement becoming effective. The FY 2018
Arrangement copied below is substantially similar to the previous
year's Arrangement. FEMA has made several changes designed to improve
the overall clarity and readability of the document, as well as
incorporate existing WYO Program policies and requirements. Noteworthy
changes include:
     Inclusion of the NFIP Federal Insurance Directorate's
mission statement in Article I;
     Clear references to important guidance documents, such as
the Financial Control Plan, the Transaction Record Reporting and
Processing (TRRP) Plan, the Flood Insurance Manual, and the Adjuster
Claims Manual;
     Authorization for FEMA to require WYO companies to collect
customer service information to monitor and improve program delivery
(Article II.F.3);
     Inclusion of existing WYO company requirements for an
appeals process (Article II.G);
     Removal of the Single Adjuster Program;
     Updated legal citations;
     Authorization for FEMA to provide WYO companies with a
statistical summary of their individual performance in comparison with
other WYO companies and NFIP Direct (Article IV.D);
     Modification of commencement and termination processes in
response to removing the Arrangement from the CFR, see 81 FR 84483,
Nov. 23, 2016 (Article V.A-B);
     Numerous stylistic changes designed to improve overall
clarity and readability in accordance with Federal Plain Language
Guidelines.
    The Fiscal Year 2018 Arrangement reads as follows:

Financial Assistance/Subsidy Arrangement

Article I. Findings, Purposes, and Authority
    Whereas, the Congress in its ``Finding and Declaration of Purpose''
in the National Flood Insurance Act of 1968, Public Law 90-448, Title
XIII, as amended, (``the Act'' or ``Act'') recognized the benefit of
having the National Flood Insurance Program (the ``Program'' or
``NFIP'') ``carried out to the maximum extent practicable by the
private insurance industry''; and
    Whereas, the Federal Emergency Management Agency (``FEMA''), which
operates the Program through its Federal Insurance and Mitigation
Administration (``FIMA''), recognizes this Arrangement as coming under
the provisions of Sections 1340 and 1345 of the Act (42 U.S.C. 4071 and
4081, respectively); and
    Whereas, the goal of FEMA is to develop a program with the
insurance industry where the risk-bearing role for the industry will
evolve as intended by the Congress (Section 1304 of the Act [42 U.S.C.
4011]); and
    Whereas, Section 205 of the Bunning-Bereuter-Blumenauer Flood
Insurance Reform Act of 2004, Public Law 108-264, as implemented by 44
CFR 62.20, permits Program policyholders to appeal the denial of a
claim, in completely or in part, to FEMA; and
    Whereas, the NFIP is a program administered by FEMA, all
participants of this Arrangement, and other entities operating on their
behalf, shall align themselves toward the common purpose of helping
survivors and their communities recover from floods by effectively
delivering customer-focused flood insurance products and information;
and
    Whereas, the insurer (hereinafter the ``Company'') under this
Arrangement must charge rates established by FEMA; and
    Whereas, FEMA has promulgated regulations and guidance implementing
the Act and the Write Your Own (WYO) Program whereby participating
private insurance companies act in a fiduciary capacity utilizing
Federal funds to sell and administer the Standard Flood Insurance
Policies, and has extensively regulated the participating companies'
activities when selling or administering the Standard Flood Insurance
Policies; and
    Whereas, any litigation resulting from, related to, or arising from
the Company's compliance with the written standards, procedures, and
guidance issued by FEMA arises under the Act or regulations, and legal
issues thereunder raise a Federal question; and
    Whereas, through this Arrangement, the Federal Treasury will back
all flood policy claim payments by the Company; and
    Whereas, FEMA developed this Arrangement to enable any interested
qualified insurer to write flood insurance under its own name; and
    Whereas, one of the primary objectives of the Program is to provide
coverage to the maximum number of buildings at risk and because the
insurance industry has marketing access through its existing facilities
not directly available to FEMA, FEMA concludes that coverage will be
extended to those who would not otherwise be insured under the Program;
and
    Whereas, flood insurance policies issued subject to this
Arrangement must be only that insurance written by the Company in its
own name under prescribed policy conditions and pursuant to this
Arrangement, the Act, and any guidance issued by FEMA; and
    Whereas, over time, the Program is designed to increase industry
participation, and, accordingly, reduce or eliminate Government as the
principal vehicle for delivering flood insurance to the public; and
    Whereas, the sole parties under this Arrangement are Company and
FEMA.
    Now, therefore, the parties hereto mutually undertake the
following:
Article II. Undertakings of the Company
    A. Eligibility Requirements for Participation in the NFIP.
    1. Policy Administration. All fund receipt, recording, control,
timely deposit requirements, and disbursement in connection with all
Policy Administration and any other related activities or
correspondences, must meet all requirements of the Financial Control
Plan and any guidance issued by FEMA. The Company shall be responsible
for:

a. Compliance with the Community Eligibility/Rating Criteria
b. Making Policyholder Eligibility Determinations
c. Policy Issuances
d. Policy Endorsements
e. Policy Cancellations
f. Policy Correspondence
g. Payment of Agents' Commissions

    2. Claims Processing. The Company must process all claims
consistent with the Standard Flood Insurance Policy, Financial Control
Plan, other guidance adopted by FEMA, and as much as possible, with the
Company's standard business practices for its non-NFIP policies.

    3. Reports. The Company must submit monthly financial reports and
statistical transaction reports in accordance with the requirements of
the NFIP Transaction Record Reporting and Processing Plan for the
Company and the Financial Control Plan for business written under the
WYO Program, as well as with WYO Accounting Procedures. FEMA will
validate, edit, and audit in detail these data and compare and balance
the results against Company reports.
    B. Time Standards. Time will be measured from the date of receipt
through the date mailed out. All dates referenced are working days, not
calendar days. In addition to the standards set forth below, all
functions performed by the Company must be in accordance with the
highest reasonably attainable quality standards generally utilized in
the insurance and data processing field. Continual failure to meet
these requirements may result in limitations on the company's authority
to write new business or the removal of the Company from the WYO
Program. Applicable time standards are:

1. Application Processing--15 days (Note: If the policy cannot be
mailed due to insufficient or erroneous information or insufficient
funds, the Company must mail a request for correction or added moneys
within 10 days)
2. Renewal processing--7 days
3. Endorsement processing--15 days
4. Cancellation processing--15 days
5. Claims Draft Processing--7 days from completion of file examination
6. Claims Adjustment--45 days average from the receipt of Notice of
Loss (or equivalent) through completion of examination

    C. Policy Issuance.
    1. The flood insurance subject to this Arrangement must be only
that insurance written by the Company in its own name pursuant to the
Act.
    2. The Company must issue policies under the regulations prescribed
by the Federal Emergency Management Agency, in accordance with the Act,
on a form approved by FEMA.
    3. All policies must be issued in consideration of such premiums
and upon such terms and conditions and in such States or areas or
subdivisions thereof as may be designated by FEMA and only where the
Company is licensed by State law to engage in the property insurance
business.
    D. FEMA may require the Company to discontinue issuing policies
subject to this Arrangement immediately in the event Congressional
authorization or appropriation for the NFIP is withdrawn.
    E. The Company must separate Federal flood insurance funds from all
other Company accounts, at a bank or banks of its choosing for the
collection, retention and disbursement of Federal funds relating to its
obligation under this Arrangement, less the Company's expenses as set
forth in Article III, and the operation of the Letter of Credit
established pursuant to Article IV. The Company must remit all funds
not required to meet current expenditures to the United States
Treasury, in accordance with the provisions of the WYO Accounting
Procedures Manual.
    F. The Company must investigate, adjust, settle, and defend all
claims or losses arising from policies issued under this Arrangement.
Payment of flood insurance claims by the Company bind FEMA, subject to
appeal.
    G. Compliance with Agency Standards and Guidelines.
    1. The Company must comply with the Act, regulations, written
standards, procedures, and guidance issued by FEMA relating to the NFIP
and applicable to the Company, including, but not limited to:

    a. Financial Control Plan
    b. Transaction Record and Reporting Plan (TRRP)
    c. Flood Insurance Manual
    d. Adjuster Claims Manual
    e. WYO Bulletins

    2. The Company must market flood insurance policies in a manner
consistent with marketing guidelines established by FEMA.
    3. FEMA may require the Company to collect customer service
information to monitor and improve their program delivery.
    4. The Company must notify its agents of the requirement to comply
with State regulations regarding flood insurance agent education,
notify agents of flood insurance training opportunities, and assist
FEMA in periodic assessment of agent training needs.
    H. Compliance with Appeals Process.
    1. FEMA will notify the Company when a policyholder files an
appeal. After notification, the Company must provide FEMA the following
information:
    a. All records created or maintained pursuant to this Arrangement
requested by FEMA; and
    b. A comprehensive claim file synopsis that includes a summary of
the appeal issues, the Company's position on each issue, and any
additional relevant information. If, in the process of writing the
synopsis, the Company determines that it can address the issue raised
by the policyholder on appeal without further direction, it must notify
FEMA. The Company will then work directly with the policyholder to
achieve resolution and update FEMA upon completion. The Company may
have a claims examiner review the file who is independent from the
original decision and who possesses the authority to overturn the
original decision if the facts support it.
    2. The Company must cooperate with FEMA throughout the appeal
process until final resolution. This includes adhering to any written
appeals guidance issued by FEMA.
    3. Resolution of Appeals. FEMA will close an appeal when:
    a. FEMA upholds the denial by the Company;
    b. FEMA overturns the denial by the Company and all necessary
actions that follow are completed;
    c. The Company independently resolves the issue raised by the
policyholder without further direction;
    d. The policyholder voluntarily withdraws the appeal; or
    e. The policyholder files litigation.
    4. Processing of Additional Payments from Appeal. The Company must
follow supplemental claim procedures for appeals that result in
additional payment to a policyholder.
Article III. Loss Costs, Expenses, Expense Reimbursement, and Premium
Refunds
    A. The Company is liable for operating, administrative and
production expenses, including any State premium taxes, dividends,
agents' commissions or any other expense of whatever nature incurred by
the Company in the performance of its obligations under this
Arrangement but excluding other taxes or fees, such as municipal or
county premium taxes, surcharges on flood insurance premium, and
guaranty fund assessments.
    B. Payment for Selling and Servicing Policies.
    1. Operating and Administrative Expenses. The Company may withhold,
as operating and administrative expenses, other than agents' or
brokers' commissions, an amount from the Company's written premium on
the policies covered by this Arrangement in reimbursement of all of the
Company's marketing, operating, and administrative expenses, except for
allocated and unallocated loss adjustment expenses described in Article
III.C. This amount will equal the sum of the average industry expenses
ratios for ``Other Acq.'', ``Gen. Exp.'' and ``Taxes'' calculated by
aggregating premiums and expense amounts for each of five property
coverages using direct premium and expense

information to derive weighted average expense ratios. For this
purpose, FEMA will use data for the property/casualty industry
published, as of March 15 of the prior Arrangement year, in Part III of
the Insurance Expense Exhibit in A.M. Best Company's Aggregates and
Averages for the following five property coverages: Fire, Allied Lines,
Farmowners Multiple Peril, Homeowners Multiple Peril, and Commercial
Multiple Peril (non-liability portion). In addition, this amount will
be increased by one (1) percentage point to reimburse expenses beyond
regular property/casualty expenses.
    2. Agent Compensation. The Company may retain fifteen (15) percent
of the Company's written premium on the policies covered by this
Arrangement as the commission allowance to meet the commissions or
salaries of insurance agents, brokers, or other entities producing
qualified flood insurance applications and other related expenses.
    3. Growth Bonus. The amount of expense allowance retained by the
Company may increase a maximum of two (2) percentage points depending
on the extent to which the Company meets the marketing goals for the
Arrangement year contained in marketing guidelines established pursuant
to Article II.G. We will pay the Company the amount of any increase
after the end of the Arrangement year.
    4. Reimbursement for Services of a National Rating Organization.
The Company, with the consent of FEMA as to terms and costs, may use
the services of a national rating organization, licensed under state
law, to help us undertake and carry out such studies and investigations
on a community or individual risk basis, and to determine equitable and
accurate estimates of flood insurance risk premium rates as authorized
under the Act, as amended. We will reimburse the Company for the
charges or fees for such services under the provisions of the WYO
Accounting Procedures Manual.
    C. FEMA will reimburse Loss Adjustment Expenses as follows:
    1. FEMA will reimburse unallocated loss adjustment expenses to the
Company pursuant to a ``ULAE Schedule'' coordinated with the Company
and provided by FEMA.
    2. FEMA will reimburse allocated loss adjustment expenses to the
Company pursuant to a ``Fee Schedule'' coordinated with the Company and
provided by FEMA.
    3. FEMA will reimburse special allocated loss expenses to the
Company in accordance with guidelines issued by FEMA.
    D. Loss Payments.
    1. The Company must make loss payments for flood insurance policies
from Federal funds retained in the bank account(s) established under
Article II.E and, if such funds are depleted, from Federal funds
derived by drawing against the Letter of Credit established pursuant to
Article IV.
    2. Loss payments include payments as a result of litigation that
arises under the scope of this Arrangement, and the Authorities set
forth herein. All such loss payments and related expenses must meet the
documentation requirements of the Financial Control Plan and of this
Arrangement, and the Company must comply with the litigation
documentation and notification requirements established by FEMA.
Failure to meet these requirements may result in FEMA's decision not to
provide reimbursement.
    3. Limitation on Litigation Costs.
    a. Following receipt of notice of such litigation, the FEMA Office
of Chief Counsel (``OCC'') will review the information submitted. If
OCC finds that the litigation is grounded in actions by the Company
that are significantly outside the scope of this Arrangement, and/or
involves issues of agent negligence, then OCC may make a recommendation
regarding whether all or part of the litigation is significantly
outside the scope of the Arrangement.
    b. In the event the FEMA determines that the litigation is grounded
in actions by the Company that are significantly outside the scope of
this Arrangement, and/or involves issues of agent negligence, then FEMA
will notify the Company in writing within thirty (30) days that any
award or judgment for damages and any costs to defend such litigation
will not be recognized under Article III as a reimbursable loss cost,
expense, or expense reimbursement.
    c. In the event a question arises whether only part of the costs of
a litigation is reimbursable, OCC may make a recommendation about the
appropriate division of responsibility, if possible.
    d. In the event that the Company wishes to petition for
reconsideration of the determination that it will not be reimbursed for
any part of the award or judgment or any part of the costs expended to
defend such litigation made under Article III.D.3.a-c, it may do so by
mailing, within thirty (30) days of the notice that reimbursement will
not be made, a written petition to FEMA, who may request advice on
other than legal matters of the WYO Standards Committee established
under the WYO Financial Control Plan. The WYO Standards Committee will
consider the request at its next regularly scheduled meeting or at a
special meeting called for that purpose by the Chairman and issue a
written recommendation to the Administrator. FEMA's final determination
will be made in writing within a reasonable time to the Company.
    E. The Company must make premium refunds required by FEMA to
applicants and policyholders from Federal flood insurance funds
referred to in Article II.E, and, if such funds are depleted, from
funds derived by drawing against the Letter of Credit established
pursuant to Article IV. The Company may not refund any premium to
applicants or policyholders in any manner other than as specified by
FEMA since flood insurance premiums are funds of the Federal
Government.
Article IV. Undertakings of the Government
    A. FEMA must establish Letter(s) of Credit against which the
Company may withdraw funds daily, if needed, pursuant to prescribed
procedures implemented by FEMA. The amounts of the authorizations will
be increased as necessary to meet the obligations of the Company under
Article III.C-E. The Company may only request funds when net premium
income has been depleted. The timing and amount of cash advances must
be as close as is administratively feasible to the actual disbursements
by the recipient organization for allowable Letter of Credit expenses.
Request for payment on Letters of Credit may not ordinarily be drawn
more frequently than daily or in amounts less than $5,000, and in no
case more than $5,000,000 unless so stated on the Letter of Credit.
This Letter of Credit may be drawn by the Company for any of the
following reasons:
    1. Payment of claims, as described in Article III.D;
    2. Refunds to applicants and policyholders for insurance premium
overpayment, or if the application for insurance is rejected or when
cancellation or endorsement of a policy results in a premium refund, as
described in Article III.E; and
    3. Allocated and unallocated loss adjustment expenses, as described
in Article III.C.
    B. FEMA must provide technical assistance to the Company as
follows:
    1. FEMA's policy, history concerning underwriting, and claims
handling.
    2. A mechanism to assist in clarification of coverage and claims
questions.
    3. Other assistance as needed.
    C. FEMA must provide the Company with a copy of all formal written
appeal

decisions conducted in accordance with Section 205 of the Bunning-
Bereuter-Blumenauer Flood Insurance Reform Act of 2004, Public Law 108-
264 and 44 CFR 62.20.
    D. Prior to the end of the Arrangement period, FEMA may provide the
Company a statistical summary of their performance during the signed
Arrangement period. This summary will detail the Company's performance
individually, as well as compare the Company's performance to the
aggregate performance of all NFIP producers across the Program.
Article V. Commencement and Termination
    A. The effective period of this Arrangement begins on October 1,
2017 and terminates no earlier than September 30, 2018, subject to
extension pursuant to Article V.C. FEMA may provide financial
assistance only for policy applications and endorsements accepted by
the Company during this period pursuant to the Program's effective
date, underwriting, and eligibility rules.
    B. Pursuant to 44 CFR 62.23(a), FEMA will publish the Arrangement
and the terms for subscription or re-subscription for Fiscal Year 2019
in the Federal Register no later than April 1, 2018. Upon such
publication, the Company must notify FEMA of its intent to re-subscribe
or not re-subscribe to the WYO Program for the following term within
ninety (90) calendar days.
    C. In addition to the requirements of Article V.B, in order to
assure uninterrupted service to policyholders, the Company must
promptly notify FEMA in the event the Company elects not to re-
subscribe to the WYO Program during the term of this Arrangement. If so
notified, or if FEMA chooses not to renew the Company's participation,
FEMA, at its option, may require the continued performance of all or
selected elements of this Arrangement for the period required for
orderly transfer or cessation of business and settlement of accounts,
not to exceed eighteen (18) months, and may either require Article
V.C.1 or allow Article V.C.2:
    1. The delivery to FEMA of:
    a. A plan for the orderly transfer to FEMA of any continuing
responsibilities in administering the policies issued by the Company
under the Program including provisions for coordination assistance; and
    b. All data received, produced, and maintained through the life of
the Company's participation in the Program, including certain data, as
determined by FEMA, in a standard format and medium; and
    c. All claims and policy files, including those pertaining to
receipts and disbursements that have occurred during the life of each
policy. In the event of a transfer of the services provided, the
Company must provide FEMA with a report showing, on a policy basis, any
amounts due from or payable to insureds, agents, brokers, and others as
of the transition date; and
    d. All funds in its possession with respect to any policies
transferred to FEMA for administration and the unearned expenses
retained by the Company.
    2. Submission of plans for the renewal of the business by another
WYO company or companies or the submission of detailed plans for
another WYO company to assume responsibility for the Company's NFIP
policies. Such plans must assure uninterrupted service to policyholders
and must be accompanied by a formal request for FEMA approval of such
transfers.
    D. Cancellation by FEMA.
    1. FEMA may cancel financial assistance under this Arrangement in
its entirety upon thirty (30) days written notice to the Company by
certified mail stating one of the following reasons for such
cancellation:
    a. Fraud or misrepresentation by the Company subsequent to the
inception of the Arrangement; or
    b. Nonpayment to FEMA of any amount due; or
    c. Material failure to comply with the requirements of this
Arrangement or with the written standards, procedures, or guidance
issued by FEMA relating to the NFIP and applicable to the Company.
    2. If FEMA cancels this Arrangement pursuant to Article V.D.1, FEMA
may require the transfer of administrative responsibilities and the
transfer of data and records as provided in Article V.C.1.a-d. If
transfer is required, the Company must remit to FEMA the unearned
expenses retained by the Company. In such event, FEMA will assume all
obligations and liabilities owed to policyholders under such policies,
arising before and after the date of transfer.
    3. As an alternative to the transfer of the policies to FEMA
pursuant to Article V.D.2, FEMA will consider a proposal, if it is made
by the Company, for the assumption of responsibilities by another WYO
company as provided in Article V.C.2.
    E. In the event that the Company is unable or otherwise fails to
carry out its obligations under this Arrangement by reason of any order
or directive duly issued by the Department of Insurance of any
jurisdiction to which the Company is subject, the Company agrees to
transfer, and FEMA will accept, any and all WYO policies issued by the
Company and in force as of the date of such inability or failure to
perform. In such event FEMA will assume all obligations and liabilities
within the scope of the Arrangement owed to policyholders arising
before and after the date of transfer, and the Company will immediately
transfer to FEMA all needed records and data and all funds in its
possession with respect to all such policies transferred and the
unearned expenses retained by the Company.
    As an alternative to the transfer of the policies to FEMA, FEMA
will consider a proposal, if it is made by the Company, for the
assumption of responsibilities by another WYO company as provided by
Article V.C.2.
    F. In the event the Act is amended, repealed, expires, or if FEMA
is otherwise without authority to continue the Program, FEMA may cancel
financial assistance under this Arrangement for any new or renewal
business, but the Arrangement will continue for policies in force that
shall be allowed to run their term under the Arrangement.
Article VI. Information and Annual Statements
    A. The Company must furnish to FEMA such summaries and analysis of
information including claim file information, and property address,
location, and/or site information in its records as may be necessary to
carry out the purposes of the Act, in such form as FEMA, in cooperation
with the Company, will prescribe.
    B. Upon request, the Company must file with FEMA a true and correct
copy of the Company's Fire and Casualty Annual Statement, and Insurance
Expense Exhibit or amendments thereof as filed with the State Insurance
Authority of the Company's domiciliary State.
Article VII. Cash Management and Accounting
    A. FEMA must make available to the Company during the entire term
of this Arrangement, and any continuation period required by FEMA
pursuant to Article V.C, the Letter of Credit provided for in Article
IV drawn on a repository bank within the Federal Reserve System. This
Letter of Credit may be drawn by the Company for reimbursement of its
expenses as set forth in Article IV that exceed net written premiums
collected by the Company from the effective date of this Arrangement or
continuation period to

the date of the draw. In the event that adequate Letter of Credit
funding is not available to meet current Company obligations for flood
policy claim payments issued, FEMA must direct the Company to
immediately suspend the issuance of loss payments until such time as
adequate funds are available. The Company is not required to pay claims
from their own funds in the event of such suspension.
    B. The Company must remit all funds, including interest, not
required to meet current expenditures to the United States Treasury, in
accordance with the provisions of the WYO Accounting Procedures Manual
or procedures approved in writing by FEMA.
    C. In the event the Company elects not to participate in the
Program in this or any subsequent fiscal year, or is otherwise unable
or not permitted to participate, the Company and FEMA must make a
provisional settlement of all amounts due or owing within three (3)
months of the expiration or termination of this Arrangement. This
settlement must include net premiums collected, funds drawn on the
Letter of Credit, and reserves for outstanding claims. The Company and
FEMA agree to make a final settlement, subject to audit, of accounts
for all obligations arising from this Arrangement within eighteen (18)
months of its expiration or termination, except for contingent
liabilities that must be listed by the Company. At the time of final
settlement, the balance, if any, due FEMA or the Company must be
remitted by the other immediately and the operating year under this
Arrangement must be closed.
Article VIII. Arbitration
    If any misunderstanding or dispute arises between the Company and
FEMA with reference to any factual issue under any provisions of this
Arrangement or with respect to FEMA's nonrenewal of the Company's
participation, other than as to legal liability under or interpretation
of the Standard Flood Insurance Policy, such misunderstanding or
dispute may be submitted to arbitration for a determination that will
be binding upon approval by FEMA. The Company and FEMA may agree on and
appoint an arbitrator who will investigate the subject of the
misunderstanding or dispute and make a determination. If the Company
and FEMA cannot agree on the appointment of an arbitrator, then two
arbitrators will be appointed, one to be chosen by the Company and one
by FEMA.
    The two arbitrators so chosen, if they are unable to reach an
agreement, must select a third arbitrator who must act as umpire, and
such umpire's determination will become final only upon approval by
FEMA. The Company and FEMA shall bear in equal shares all expenses of
the arbitration. Findings, proposed awards, and determinations
resulting from arbitration proceedings carried out under this section,
upon objection by FEMA or the Company, shall be inadmissible as
evidence in any subsequent proceedings in any court of competent
jurisdiction.
    This Article shall indefinitely succeed the term of this
Arrangement.
Article IX. Errors and Omissions
    In the event of negligence by the Company that has not resulted in
litigation but has resulted in a claim against the Company, FEMA will
not consider reimbursement of the Company for costs incurred due to
that negligence unless the Company takes all reasonable actions to
rectify the negligence and to mitigate any such costs as soon as
possible after discovery of the negligence. The Company may choose not
to seek reimbursement from FEMA.
    Further, if the claim against the Company is grounded in actions
significantly outside the scope of this Arrangement or if there is
negligence by the agent, FEMA will not reimburse any costs incurred due
to that negligence. The Company will be notified in writing within
thirty (30) days of a decision not to reimburse. In the event the
Company wishes to petition for reconsideration of the decision not to
reimburse, the procedure in Article III.D.3.d applies.
    However, in the event that the Company has made a claim payment to
an insured without including a mortgagee (or trustee) of which the
Company had actual notice prior to making payment, and subsequently
determines that the mortgagee (or trustee) is also entitled to any part
of said claim payment, any additional payment may not be paid by the
Company from any portion of the premium and any funds derived from any
Federal Letter of Credit deposited in the bank account described in
Article II.E. In addition, the Company agrees to hold the Federal
Government harmless against any claim asserted against the Federal
Government by any such mortgagee (or trustee), as described in the
preceding sentence, by reason of any claim payment made to any insured
under the circumstances described above.
Article X. Officials Not To Benefit
    No Member or Delegate to Congress, or Resident Commissioner, may be
admitted to any share or part of this Arrangement, or to any benefit
that may arise therefrom; but this provision may not be construed to
extend to this Arrangement if made with a corporation for its general
benefit.
Article XI. Offset
    At the settlement of accounts, the Company and FEMA has, and may
exercise, the right to offset any balance or balances, whether on
account of premiums, commissions, losses, loss adjustment expenses,
salvage, or otherwise due one party to the other, its successors or
assigns, hereunder or under any other Arrangements heretofore or
hereafter entered into between the Company and FEMA. This right of
offset shall not be affected or diminished because of insolvency of the
Company.
    All debts or credits of the same class, whether liquidated or
unliquidated, in favor of or against either party to this Arrangement
on the date of entry, or any order of conservation, receivership, or
liquidation, shall be deemed to be mutual debts and credits and shall
be offset with the balance only to be allowed or paid. No offset shall
be allowed where a conservator, receiver, or liquidator has been
appointed and where an obligation was purchased by or transferred to a
party hereunder to be used as an offset.
    Although a claim on the part of either party against the other may
be unliquidated or undetermined in amount on the date of the entry of
the order, such claim will be regarded as being in existence as of the
date of such order and any credits or claims of the same class then in
existence and held by the other party may be offset against it.
Article XII. Equal Opportunity
    The Company shall not discriminate against any applicant for
insurance because of race, color, religion, sex, age, handicap, marital
status, or national origin.
Article XIII. Restriction on Other Flood Insurance
    As a condition of entering into this Arrangement, the Company
agrees that in any area in which FEMA authorizes the purchase of flood
insurance pursuant to the Program, all flood insurance offered and sold
by the Company to persons eligible to buy pursuant to the Program for
coverages available under the Program shall be written pursuant to this
Arrangement.
    This restriction applies solely to policies providing only flood
insurance. It does not apply to policies provided by the Company of
which flood is one of

the several perils covered, or where the flood insurance coverage
amount is over and above the limits of liability available to the
insured under the Program.
Article XIV. Access to Books and Records
    FEMA, the Department of Homeland Security, and the Comptroller
General of the United States, or their duly authorized representatives,
for the purpose of investigation, audit, and examination shall have
access to any books, documents, papers and records of the Company that
are pertinent to this Arrangement. The Company shall keep records that
fully disclose all matters pertinent to this Arrangement, including
premiums and claims paid or payable under policies issued pursuant to
this Arrangement. Records of accounts and records relating to financial
assistance shall be retained and available for three (3) years after
final settlement of accounts, and to financial assistance, three (3)
years after final adjustment of such claims. FEMA shall have access to
policyholder and claim records at all times for purposes of the review,
defense, examination, adjustment, or investigation of any claim under a
flood insurance policy subject to this Arrangement.
Article XV. Compliance With Act and Regulations
    This Arrangement and all policies of insurance issued pursuant
thereto are subject to Federal law and regulations.
Article XVI. Relationship Between the Parties and the Insured
    Inasmuch as the Federal Government is a guarantor hereunder, the
primary relationship between the Company and the Federal Government is
one of a fiduciary nature, that is, to assure that any taxpayer funds
are accounted for and appropriately expended. The Company is a fiscal
agent of the Federal Government, but is not a general agent of the
Federal Government. The Company is solely responsible for its
obligations to its insured under any policy issued pursuant hereto,
such that the Federal Government is not a proper party to any lawsuit
arising out of such policies.

    Authority:  42 U.S.C. 4071, 4081; 44 CFR 62.23.

    Dated: April 3, 2017.
Roy E. Wright,
Deputy Associate Administrator for Insurance and Mitigation, Federal
Emergency Management Agency.
[FR Doc. 2017-07020 Filed 4-6-17; 8:45 am]
 BILLING CODE 9111-52-P