[Federal Register Volume 76, Number 211 (Tuesday, November 1, 2011)]
[Notices]
[Pages 67503-67506]
[FR Doc No: 2011-28243]

=======================================================================
-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-65631; File No. SR-MSRB-2011-19]

Self-Regulatory Organizations; Municipal Securities Rulemaking
Board; Notice of Filing of a Proposed Rule Change Consisting of
Amendments to Rule G-16 on Periodic Compliance Examination and Rule G-9
on Preservation of Records

October 26, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is
hereby given that on October 13, 2011, the Municipal Securities
Rulemaking Board (``Board'' or ``MSRB'') filed with the Securities and
Exchange Commission (``SEC'' or ``Commission'') the proposed rule
change as described in Items I, II, and III below, which Items have
been prepared by the MSRB. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The MSRB is filing with the SEC a proposed rule change consisting
of amendments to Rule G-16, on periodic compliance examination, in
order to permit the examination of brokers, dealers, and municipal
securities dealers (``dealers'') that are members of the Financial
Industry Regulatory Authority (``FINRA'') at least once each four
calendar years, rather than at least once each two calendar years as
currently prescribed by Rule G-16. Further, the MSRB is filing with the
SEC a proposed rule change consisting of amendments to Rule G-9, on
preservation of records, which would require dealers to retain certain
records for four years, rather than three years as currently prescribed
by Rule G-9.
    The text of the proposed rule change is available on the MSRB's Web
site at http://www.msrb.org/Rules-and-Interpretations/SEC-Filings/2011-Filings.aspx, at the MSRB's principal office, and at the Commission's
Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the MSRB included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Board has prepared summaries, set forth in Sections
A, B, and C below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to facilitate the
modernization of the examination process for dealers and to permit
greater flexibility in the administration of periodic compliance
examinations in order to focus more closely on those dealers that, by
virtue of various identified factors, pose the greatest risk to
investors and other market participants, as well as to the municipal
securities market on a systemic basis.
    Periodic examinations of regulated entities are an important
component of the regulatory oversight process. Examinations are
intended to detect wrongful conduct, including violations of the
federal securities laws and self-regulatory organization rules.
Pursuant to Section 15B(b)(2)(E) of the Securities Exchange Act of 1934
(the '' Exchange Act''), MSRB rules must provide for the periodic
examination of municipal securities brokers, municipal securities
dealers, or municipal advisors (``regulated entities'') to determine

compliance with Section 15B of the Exchange Act, the rules and
regulations thereunder, and MSRB rules. The same provision requires
that the MSRB specify the minimum scope and frequency of the
examinations and that the examination rules be designed to avoid
unnecessary regulatory duplication or undue regulatory burden for any
regulated entity.
    Section 15B(c)(7) of the Exchange Act provides that the periodic
examination of regulated entities shall be conducted by (a) A
registered securities association in the case of dealers that are
members of the registered securities association, (b) the appropriate
regulatory agency (``bank regulators'') in the case of dealers that are
not members of a registered securities association, and (c) the SEC, or
its designee, in the case of municipal advisors. There is one
securities association registered with the SEC--FINRA. Approximately
1,800 MSRB registered dealers are members of and examined by FINRA,
with the remaining dealers registered with the SEC as municipal
securities dealers and examined primarily by the various federal bank
regulators.
    Rule G-16 currently provides that, at least once every two calendar
years, dealers must be examined in accordance with Section 15B of the
Exchange Act, in order to determine whether the dealers are in
compliance with all MSRB rules and applicable provisions of the
Exchange Act. Separately, FINRA examines its members pursuant to a
risk-based approach at least every four calendar years. In order to
comply with Rule G-16, FINRA and the MSRB agreed to a protocol allowing
for a questionnaire to be completed by certain firms every two calendar
years. These dealers are typically less active in the municipal
securities market and, therefore, pose less overall risk to market
participants. The questionnaire, entitled the Alternative Municipal
Examination (``AME'') module, was implemented in 1998, after review by
SEC and MSRB staff.
    The AME is used as an off-site examination for low-risk dealers
that: (a) Conduct a limited municipal securities business; (b) do not
conduct a public finance business; and (c) are not otherwise identified
as high risk firms for regulatory purposes. The AME is necessarily
general and not tailored to the specific business of any one firm. It
relies on each responding dealer to self report rule violations and to
certify that the information provided is truthful and accurate.
    After many years of experience with the AME, the MSRB and FINRA
believe that a more risk-based examination protocol should be
implemented and that Rule G-16 should be amended to allow for up to a
four year examination cycle for FINRA-member firms, consistent with
FINRA's requirement for cycle examinations of all other FINRA members.
This would also allow FINRA to integrate the municipal securities cycle
examination program more closely with its overall cycle examination
program, and redeploying staff resources from administering the AME to
participating in the risk-based examination program would foster more
meaningful oversight. Moreover, over the last few years, there have
been significant advances in information technology, particularly with
the development of the MSRB's Real-time Transaction Reporting System
and Electronic Municipal Market Access system. These advancements in
information technology and transparency have enabled FINRA to develop
robust automated surveillance reviews of municipal securities
transactions. FINRA is now able to review municipal securities
transactions and other activity remotely, in order to identify
potential MSRB rule violations by dealers. These tools permit FINRA
staff to conduct near real-time surveillance of certain municipal
securities activities.
    It is also apparent that the municipal securities business has
changed dramatically over the last few years. The industry has
consolidated and a small number of large firms account for the majority
of public finance business. The top five underwriters accounted for
over 50 percent, by par amount, of primary offerings in 2010 and 2011.
\3\ The top 10 underwriters accounted for over 70 percent of the
underwritings, by par amount, in 2010 and 2011, and the top 200
accounted for almost 100 percent of the underwritings, by par amount,
in 2010 and 2011. According to data gathered by the MSRB, the top 10
dealers executed approximately 55 percent of all municipal securities
transactions reported to the MSRB in 2010 and 2011. The top 50 dealers
executed approximately 80 percent of all such transactions in 2010 and
2011, and the top 200 dealers executed approximately 96 percent of all
such transactions. By par amount, the top 200 dealers executed
approximately 98 percent of all municipal securities transactions
reported to the MSRB in 2010 and 2011. The remaining approximately
1,600 firms are less active in the municipal securities market, engage
solely in the sale of interests in 529 College Savings Plans, or effect
municipal securities transactions primarily as an accommodation to
their customers. Generally, these firms are not engaged in financial
advisory activities or municipal securities underwriting, research, or
trading. They, therefore, do not pose systemic risk to the market in
these areas.
---------------------------------------------------------------------------

    \3\ All 2011 figures are through September 2011. Underwriting
statistics are provided by Thomson Reuters.
---------------------------------------------------------------------------

    With input from the MSRB, consistent with Section 15B(b)(4) of the
Exchange Act, FINRA is enhancing its risk assessment approach to rank
dealers by certain risk factors, as well as by size and scope of
business, to determine their examination cycle frequencies, which under
the proposed rule change would range from one to four years, rather
than every two years as currently prescribed by Rule G-16. It is
anticipated that, based on the analysis of the various identified risks
and related factors, those firms that represent higher risks, as well
as firms that pose a systemic threat based on the scope and scale of
their underlying municipal securities activities, would be examined on
an annual basis. Other firms would be examined less frequently, every
two to four years, depending on the risk ranking and size of their
municipal securities business and the firm's overall business model. At
a minimum, all firms would be examined at least once every four
calendar years. Cycle examination frequencies for dealers would be re-
assessed at least on an annual basis. FINRA would continue to conduct
off-site surveillance of municipal securities activity and ``cause''
examinations as needed. ``Cause'' examinations are event-driven and
typically initiated as a result of customer complaints, regulatory
tips, and other information sources identified by FINRA via its
regulatory oversight process.
    The MSRB believes that using quantitative and qualitative criteria
to rank dealers by appropriately identified risk measures and size no
less frequently than on an annual basis provides better protection for
investors, municipal entities, and other market participants, since
FINRA's resources will be focused on those firms that pose the greatest
risk to investors, municipal entities and the market. Such firms will
be subject to in-depth examinations tailored to the specific municipal
securities activities they conduct.
    Finally, the MSRB has proposed a rule change requiring dealers that
are FINRA members to retain certain records for four years, rather than
for three years, under Rule G-9 in order to ensure that the records are
available at

those firms that are examined every four calendar years.
2. Statutory Basis
    The MSRB has adopted the proposed rule change pursuant to Section
15B(b)(2)(E) of the Exchange Act, which provides that the MSRB's rules
shall:

provide for the periodic examination in accordance with subsection
(c)(7) of municipal securities brokers, municipal securities
dealers, and municipal advisors to determine compliance with
applicable provisions of this title, the rules and regulations
thereunder, and the rules of the Board. Such rules shall specify the
minimum scope and frequency of such examinations and shall be
designed to avoid any unnecessary regulatory duplication or undue
regulatory burdens for any such municipal securities broker,
municipal securities dealer, or municipal advisor.

    Section 15B(c)(7) of the Exchange Act further provides that
periodic examinations of dealers shall be conducted by a registered
securities association, in the case of dealers that are members of such
association. FINRA is currently the only registered securities
association.
    The proposed rule change will accomplish this mandate by providing
FINRA with the flexibility to establish a risk-based examination
program for municipal securities that is consistent with its other
examination programs. By conforming the municipal securities
examination program to FINRA's other examination programs and
integrating the municipal securities examination program into FINRA's
overall examination protocol, the new program should reduce regulatory
duplication and undue burden on dealers that are FINRA members by
fostering an integrated regulatory examination protocol and targeting
those firms for more frequent examinations that pose a greater risk to
investors and other market participants and have a greater impact on
the marketplace.
    With input from the MSRB, consistent with Section 15B(b)(4) of the
Exchange Act, FINRA is enhancing its risk assessment approach to rank
dealers by certain risk factors, as well as by size and scope of
business, to determine their examination cycle frequencies, which under
the proposed rule change would range from one to four years, rather
than every two years as currently prescribed by Rule G-16. It is
anticipated that, based on the analysis of the various identified risks
and related factors, those firms that represent higher risks, as well
as firms that pose a systemic threat based on the scope and scale of
their underlying municipal securities activities, would be examined on
an annual basis. Other firms would be examined less frequently, every
two to four years, depending on the risk ranking and size of their
municipal securities business and the firm's overall business model. At
a minimum, all firms would be examined at least once every four
calendar years. Cycle examination frequencies for dealers would be re-
assessed at least on an annual basis. FINRA would continue to conduct
off-site surveillance of municipal securities activity and ``cause''
examinations as needed. ``Cause'' examinations are event-driven and
typically initiated as a result of customer complaints, regulatory
tips, and other information sources identified by FINRA via its
regulatory oversight process.
    The MSRB believes that using quantitative and qualitative criteria
to rank dealers by appropriately identified risk measures and size no
less frequently than on an annual basis provides better protection for
investors, municipal entities, and other market participants, since
FINRA's resources will be focused on those firms that pose the greatest
risk to investors, municipal entities and the market. Such firms will
be subject to in-depth examinations tailored to the specific municipal
securities activities they conduct. The risk-based examination protocol
is consistent with Sections 15B(b)(2)(E) and 15B(c)(7) of the Exchange
Act in that the examinations by FINRA would be tailored to each
individual regulated entity to determine compliance with MSRB rules and
applicable federal law and would be designed to avoid any unnecessary
regulatory duplication or undue regulatory burdens.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Board does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Exchange Act. The change would
provide FINRA with greater flexibility to carry out the periodic
compliance examinations of its members mandated by Sections
15B(b)(2)(E) and 15B(c)(7) of the Exchange Act, in accordance with a
risk-based approach that is based on the risk posed by regulated
entities to investors and the marketplace and the impact of the
regulated entity's municipal securities business on the marketplace.
All such regulated entities that pose greater risk and have a higher
impact on the municipal securities market would be inspected more
frequently, and all such regulated entities that pose less risk to the
market and have a lower impact on the municipal securities market would
be inspected less frequently. All dealers that are members of FINRA
would be examined at least every four calendar years.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received on the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period (i) As the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or
    (ii) as to which the self-regulatory organization consents, the
Commission will:
    (A) by order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Exchange Act. Comments may be submitted
by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-MSRB-2011-19 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-MSRB-2011-19. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent

amendments, all written statements with respect to the proposed rule
change that are filed with the Commission, and all written
communications relating to the proposed rule change between the
Commission and any person, other than those that may be withheld from
the public in accordance with the provisions of 5 U.S.C. 552, will be
available for Web site viewing and printing in the Commission's Public
Reference Room, 100 F Street, NE., Washington, DC 20549, on official
business days between the hours of 10 a.m. and 3 p.m. Copies of such
filing also will be available for inspection and copying at the MSRB's
offices.
    All comments received will be posted without change; the Commission
does not edit personal identifying information from submissions. You
should submit only information that you wish to make available
publicly. All submissions should refer to File Number SR-MSRB-2011-19
and should be submitted on or before November 22, 2011.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\4\
---------------------------------------------------------------------------

    \4\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2011-28243 Filed 10-31-11; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 78, Number 125 (Friday, June 28, 2013)]
[Rules and Regulations]
[Pages 38837-38840]
[FR Doc No: 2013-15499]

-----------------------------------------------------------------------

DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 165

[Docket No. USCG-2013-0431]
RIN 1625-AA00

Safety Zone; Fifth Coast Guard District Fireworks Displays,
Barnegat Bay; Barnegat Township, NJ

AGENCY: Coast Guard, DHS.

ACTION: Temporary final rule.

-----------------------------------------------------------------------

SUMMARY: The Coast Guard is temporarily changing the enforcement date
of a safety zone for one recurring fireworks display in the Fifth Coast
Guard District. This regulation applies to only one recurring fireworks
event held in Barnegat Bay in Barnegat Township, New Jersey. The
fireworks display is normally held on July 4th, but this year it will
be held on July 5th. The safety zone is necessary to provide for the
safety of life on navigable waters during the event. This action is
intended to restrict vessel traffic in a portion of Barnegat Bay near
Barnegat Township, New Jersey, during the event.

DATES: This rule is effective on July 5, 2013, from 8:30 p.m. until 10
p.m.

ADDRESSES: Documents mentioned in this preamble are part of docket
[USCG-2013-0431]. To view documents mentioned in this preamble as being
available in the docket, go to http://www.regulations.gov, type the
docket number in the ``SEARCH'' box and click ``SEARCH.'' Click on Open
Docket Folder on the line associated with this rulemaking. You may also
visit the Docket Management Facility in Room W12-140 on the ground
floor of the Department of Transportation West Building, 1200 New
Jersey Avenue SE., Washington, DC 20590, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT: If you have questions on this rule,
call or email Lieutenant Veronica Smith, U.S.

Coast Guard Sector Delaware Bay, Chief of Waterways Management
Division; telephone<PHONE_NUMBER>, email<EMAIL_ADDRESS>If
you have questions on viewing or submitting material to the docket,
call Barbara Hairston, Program Manager, Docket Operations, telephone
(202) 366-9826.

SUPPLEMENTARY INFORMATION:

Table of Acronyms

DHS Department of Homeland Security
FR Federal Register
NPRM Notice of Proposed Rulemaking

A. Regulatory History and Information

    The Coast Guard is issuing this temporary final rule without prior
notice and opportunity to comment pursuant to authority under section
4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This
provision authorizes an agency to issue a rule without prior notice and
opportunity to comment when the agency for good cause finds that those
procedures are ``impracticable, unnecessary, or contrary to the public
interest.'' Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good
cause exists for not publishing a notice of proposed rulemaking (NPRM)
with respect to this rule because it is impracticable. There is
insufficient time to undertake an NPRM and immediate action is needed
to minimize potential danger to the public during the event. The
potential dangers posed by fireworks displays makes a safety zone
necessary to provide for the safety of participants, spectator craft
and other vessels transiting the event area. For the safety concerns
noted, it is in the public interest to have these regulations in effect
during the event. The Coast Guard will issue broadcast notice to
mariners to advise vessel operators of navigational restrictions. On
scene Coast Guard and local law enforcement vessels will also provide
actual notice to mariners.
    Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause
exists for making this rule effective less than 30 days after
publication in the Federal Register. It is impracticable and contrary
to the public interest to undergo a 30 day delayed effective date for
this regulation because there is insufficient time to do so.

B. Basis and Purpose

    Recurring fireworks displays are frequently held on or adjacent to
the navigable waters within the boundary of the Fifth Coast Guard
District. For a description of the geographical area of each Coast
Guard Sector--Captain of the Port Zone, please see 33 CFR 3.25.
    The regulation listing annual fireworks displays within the Fifth
Coast Guard District and safety zones locations is 33 CFR 165.506. The
Table to Sec.  165.506 identifies fireworks displays by COTP zone, with
the COTP Delaware Bay zone listed in section ``(a)'' of the Table.
    Barnegat Township sponsors an annual fireworks display held on July
4th over the waters of Barnegat Bay, Barnegat Township, New Jersey. The
Table to Sec.  165.506, at section (a) event number ``5'', describes
the enforcement date and regulated location for this fireworks event.
    In the Table, this fireworks display occurs annually on July 4th.
However, this year, the fireworks event will be held on July 5th, 2013.
    A fleet of spectator vessels are anticipated to gather nearby to
view the fireworks display. Due to the need for vessel control during
the fireworks display, vessel traffic will be temporarily restricted to
provide for the safety of participants, spectators and transiting
vessels. Under provisions of 33 CFR 165.506, during the enforcement
period, vessels may not enter the regulated area unless they receive
permission from the Coast Guard Patrol Commander.

C. Discussion of the Final Rule

    The Coast Guard will temporarily suspend the regulation listed in
Table to Sec.  165.506, section (a) event Number ``5'', and insert this
temporary regulation at Table to Sec.  165.506, at section (a.) as
event Number ``17'', in order to reflect that the fireworks display
will be held on July 5, 2013, and therefore change the enforcement
date. This change is needed to accommodate the sponsor's event plan. No
other portion of the Table to Sec.  165.506 or other provisions in
Sec.  165.506 shall be affected by this regulation.
    The regulated area of this safety zone includes all the waters of
Barnegat Bay within a 500 yard radius of the fireworks barge in
approximate position latitude 39[deg]44'50'' N, longitude
074[deg]11'21'' W, approximately 500 yards north of Conklin Island, NJ.
    This safety zone will restrict general navigation in the regulated
area during the fireworks event. Except for persons or vessels
authorized by the Coast Guard Patrol Commander, no person or vessel may
enter or remain in the regulated area during the effective period. The
regulated area is needed to control vessel traffic during the event for
the safety of participants and transiting vessels.
    In addition to notice in the Federal Register, the maritime
community will be provided extensive advance notification via the Local
Notice to Mariners, and marine information broadcasts so mariners can
adjust their plans accordingly.

D. Regulatory Analyses

    We developed this rule after considering numerous statutes and
executive orders related to rulemaking. Below we summarize our analyses
based on these statutes or executive orders.

1. Regulatory Planning and Review

    This rule is not a significant regulatory action under section 3(f)
of Executive Order 12866, Regulatory Planning and Review, as
supplemented by Executive Order 13563, Improving Regulation and
Regulatory Review, and does not require an assessment of potential
costs and benefits under section 6(a)(3) of Executive Order 12866 or
under section 1 of Executive Order 13563. The Office of Management and
Budget has not reviewed it under those Orders.
    This rule prevents traffic from transiting a portion of the
Barnegat Bay, off of Barnegat Township, New Jersey during the specified
event, the effect of this regulation will not be significant due to the
limited duration that the regulated area will be in effect and the
extensive advance notifications that will be made to the maritime
community via marine information broadcasts, local radio stations and
area newspapers so that mariners can adjust their plans accordingly.
Additionally, this rulemaking changes the enforcement date for Barnegat
Bay, Barnegat Township, New Jersey fireworks demonstration for July 5,
2013 only and does not change the permanent enforcement period that has
been published in 33 CFR 165.506, Table to Sec.  165.506 at section
(a), event Number ``5''. In some cases vessel traffic may be able to
transit the regulated area when the Coast Guard Patrol Commander deems
it is safe to do so.

2. Impact on Small Entities

    The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as
amended, requires federal agencies to consider the potential impact of
regulations on small entities during rulemaking. The term ``small
entities'' comprises small businesses, not-for-profit organizations
that are independently owned and operated and are not dominant in their
fields, and governmental jurisdictions with populations of less than
50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule
will not have a

significant economic impact on a substantial number of small entities.
    This rule would affect the following entities, some of which might
be small entities: The owners or operators of vessels intending to
transit or anchor in Barnegat Bay, off of Barnegat Township, New
Jersey, where fireworks events are being held. This regulation will not
have a significant impact on a substantial number of small entities
because it will be enforced only during the fireworks display event
that has been permitted by the Coast Guard Captain of the Port. The
Captain of the Port will ensure that small entities are able to operate
in the regulated area when it is safe to do so. In some cases, vessels
will be able to safely transit around the regulated area at various
times, and, with the permission of the Patrol Commander, vessels may
transit through the regulated area. Before the enforcement period, the
Coast Guard will issue maritime advisories so mariners can adjust their
plans accordingly.

3. Assistance for Small Entities

    Under section 213(a) of the Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104-121), we want to assist small
entities in understanding this rule. If the rule would affect your
small business, organization, or governmental jurisdiction and you have
questions concerning its provisions or options for compliance, please
contact the person listed in the FOR FURTHER INFORMATION CONTACT,
above.
    Small businesses may send comments on the actions of Federal
employees who enforce, or otherwise determine compliance with, Federal
regulations to the Small Business and Agriculture Regulatory
Enforcement Ombudsman and the Regional Small Business Regulatory
Fairness Boards. The Ombudsman evaluates these actions annually and
rates each agency's responsiveness to small business. If you wish to
comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR
(1-888-734-3247). The Coast Guard will not retaliate against small
entities that question or complain about this rule or any policy or
action of the Coast Guard.

4. Collection of Information

    This rule will not call for a new collection of information under
the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

5. Federalism

    A rule has implications for federalism under Executive Order 13132,
Federalism, if it has a substantial direct effect on the States, on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government. We have analyzed this rule under that Order and determined
that this rule does not have implications for federalism.

6. Protest Activities

    The Coast Guard respects the First Amendment rights of protesters.
Protesters are asked to contact the person listed in the FOR FURTHER
INFORMATION CONTACT section to coordinate protest activities so that
your message can be received without jeopardizing the safety or
security of people, places or vessels.

7. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538)
requires Federal agencies to assess the effects of their discretionary
regulatory actions. In particular, the Act addresses actions that may
result in the expenditure by a State, local, or tribal government, in
the aggregate, or by the private sector of $100,000,000 (adjusted for
inflation) or more in any one year. Though this rule will not result in
such an expenditure, we do discuss the effects of this rule elsewhere
in this preamble.

8. Taking of Private Property

    This rule will not cause a taking of private property or otherwise
have taking implications under Executive Order 12630, Governmental
Actions and Interference with Constitutionally Protected Property
Rights.

9. Civil Justice Reform

    This rule meets applicable standards in sections 3(a) and 3(b)(2)
of Executive Order 12988, Civil Justice Reform, to minimize litigation,
eliminate ambiguity, and reduce burden.

10. Protection of Children

    We have analyzed this rule under Executive Order 13045, Protection
of Children from Environmental Health Risks and Safety Risks. This rule
is not an economically significant rule and does not create an
environmental risk to health or risk to safety that may
disproportionately affect children.

11. Indian Tribal Governments

    This rule does not have tribal implications under Executive Order
13175, Consultation and Coordination with Indian Tribal Governments,
because it does not have a substantial direct effect on one or more
Indian tribes, on the relationship between the Federal Government and
Indian tribes, or on the distribution of power and responsibilities
between the Federal Government and Indian tribes.

12. Energy Effects

    This action is not a ``significant energy action'' under Executive
Order 13211, Actions Concerning Regulations That Significantly Affect
Energy Supply, Distribution, or Use.

13. Technical Standards

    This rule does not use technical standards. Therefore, we did not
consider the use of voluntary consensus standards.

14. Environment

    We have analyzed this rule under Department of Homeland Security
Management Directive 023-01 and Commandant Instruction M16475.lD, which
guide the Coast Guard in complying with the National Environmental
Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have determined
that this action is one of a category of actions that do not
individually or cumulatively have a significant effect on the human
environment. This rule involves the establishment of safety zones. This
rule is categorically excluded from further review under paragraph
34(g) of Figure 2-1 of the Commandant Instruction. An environmental
analysis checklist supporting this determination and a Categorical
Exclusion Determination are available in the docket where indicated
under ADDRESSES.

List of Subjects in 33 CFR Part 165

    Harbors, Marine safety, Navigation (water), Reporting and
recordkeeping requirements, Security measures, Waterways.

    For the reasons discussed in the preamble, the Coast Guard amends
33 CFR part 165 as follows:

PART 165--REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS

0
1. The authority citation for part 165 continues to read as follows:

    Authority:  33 U.S.C. 1231; 46 U.S.C. Chapter 701, 3306, 3703;
50 U.S.C. 191, 195; 33 CFR 1.05-1, 6.04-1, 6.04-6, 160.5; Pub. L.
107-295, 116 Stat. 2064; Department of Homeland Security Delegation
No. 0170.1.

0
2. In Sec.  165.506, amend part (a) in the Table to Sec.  165.506 by--
0
a. Suspending entry 5, ``Barnegat Bay, Barnegat Township, NJ, Safety
zone,'' from 8:30 p.m. until 10 p.m. on July 5, 2013.
0
b. Adding entry 17, from 8:30 p.m. until 10 p.m. on July 5, 2013, to
read as follows:

Sec.  165.506  Safety Zones; Fireworks Displays in the Fifth Coast
Guard District

----------------------------------------------------------------------------------------------------------------
             No.                          Date                      Location                Regulated area
----------------------------------------------------------------------------------------------------------------
                                 (a) Coast Guard Sector Delaware Bay--COTP Zone
----------------------------------------------------------------------------------------------------------------

                                                  * * * * * * *
17..........................  July 5......................  Barnegat Bay, Barnegat   The waters of Barnegat Bay
                                                             Township, NJ, Safety     within a 500 yard radius
                                                             Zone..                   of the fireworks barge in
                                                                                approximate position
                                                                                latitude 39[deg]44'50'' N,
                                                                                longitude 074[deg]11'21''
                                                                                W, approximately 500 yards
                                                                                north of Conklin Island,
                                                                                NJ.

                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

* * * * *

    Dated: May 30, 2013.
K. Moore,
Captain, U.S. Coast Guard, Captain of the Port Sector Delaware Bay.
[FR Doc. 2013-15499 Filed 6-27-13; 8:45 am]
BILLING CODE 9110-04-P


[Federal Register Volume 82, Number 183 (Friday, September 22, 2017)]
[Notices]
[Pages 44401-44402]
[FR Doc No: 2017-20253]

-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

Combined Notice of Filings #2

    Take notice that the Commission received the following electric
corporate filings:

    Docket Numbers: EC17-179-000.
    Applicants: Hydro One Limited, Avista Corporation.
    Description: Joint Application for Authorization of Disposition of
Assets and Merger Pursuant to Section 203 of the FPA of Hydro One
Limited, et al.
    Filed Date: 9/14/17.
    Accession Number: 20170914-5152.
    Comments Due: 5 p.m. ET 10/5/17.

    Take notice that the Commission received the following electric
rate filings:

    Docket Numbers: ER17-2497-000.
    Applicants: Alabama Power Company.
    Description: Sec.  205(d) Rate Filing: Attachment S (Gulf) 2017
Updated Depreciation Rates Filing to be effective 1/1/2018.
    Filed Date: 9/18/17.
    Accession Number: 20170918-5122.
    Comments Due: 5 p.m. ET 10/10/17.

    Docket Numbers: ER17-2498-000
    Applicants: PJM Interconnection, L.L.C.
    Description: Sec.  205(d) Rate Filing: Original Interconnection
Service Agreement No. 4781, Queue No. AB1-082 to be effective 8/25/
2017.
    Filed Date: 9/18/17.
    Accession Number: 20170918-5131.
    Comments Due: 5 p.m. ET 10/10/17.

    Docket Numbers: ER17-2499-000.
    Applicants: PJM Interconnection, L.L.C.
    Description: Sec.  205(d) Rate Filing: Pseudo-Tie Agreement SA No.
4790 for Cheoah Units to be effective 12/31/9998.
    Filed Date: 9/18/17.

    Accession Number: 20170918-5144.
    Comments Due: 5 p.m. ET 10/10/17.

    Docket Numbers: ER17-2500-000.
    Applicants: PJM Interconnection, L.L.C.
    Description: Sec.  205(d) Rate Filing: Pseudo-Tie Agreement SA No.
4791 for Calderwood Units to be effective 12/31/9998.
    Filed Date: 9/18/17.
    Accession Number: 20170918-5146.
    Comments Due: 5 p.m. ET 10/10/17.

    Docket Numbers: ER17-2501-000.
    Applicants: EDP Renewables North America LLC.
    Description: Petition for Limited Waiver of Tariff Provision and
Request for Expedited Action of EDP Renewables North America LLC.
    Filed Date: 9/18/17.
    Accession Number: 20170918-5158.
    Comments Due: 5 p.m. ET 10/10/17.

    The filings are accessible in the Commission's eLibrary system by
clicking on the links or querying the docket number.
    Any person desiring to intervene or protest in any of the above
proceedings must file in accordance with Rules 211 and 214 of the
Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00
p.m. Eastern time on the specified comment date. Protests may be
considered, but intervention is necessary to become a party to the
proceeding.
    eFiling is encouraged. More detailed information relating to filing
requirements, interventions, protests, service, and qualifying
facilities filings can be found at: http://www.ferc.gov/docs-filing/efiling/filing-req.pdf. For other information, call<PHONE_NUMBER>
(toll free). For TTY, call<PHONE_NUMBER>.

    Dated: September 18, 2017.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2017-20253 Filed 9-21-17; 8:45 am]
 BILLING CODE 6717-01-P


Subpart 11) was submitted in January 1982. A draft permit for incinerating of liquid organic and aqueous wastes in the HWI was issued to the facility in July 1987, followed by a final permit issued in September 1987. The RCRA Part B permit for the HWI was amended in March 1990 to incorporate new performance standards. Air dispersion modeling was performed for Boiler # 1 and Boiler # 2 at the NutraSweet subplant in May 1992 to determine allowable emission rates ( Radian 1992). The facility submitted a RCRA Part B Permit Renewal Application in January 1997 ( including incineration of HSW and CSW) and subsequently received Permit # HW 048( ST). A RCRA Part C Permit Application was submitted in June 1999, which included a Protocol for Screening Risk Assessment ( ENSR 1998b). 112 Monsanto submitted a RCRA Part B Permit Application in May 1999, which included a Trial Burn Plan and target physical and chemical parameters for the HWI, Boiler # 1, and Boiler # 2. Finally, NutraSweet submitted a Compliance Recertification Report for Boiler # 1 and Boiler # 2 Pursuant to the BIF Regulations in November 2000 ( ENSR 2000). This Recertification Report contained the results of a test burn performed for Boiler # 1 and Boiler # 2. No evidence was found in the file to indicate that a trial burn to support a site specific risk assessment has been conducted on the HWI or either of the boilers.

2.11.2 Risk Based Facility Prioritization This section describes findings relative to assigning Monsanto to one of the three prioritization groupings using the risk based facility prioritization strategy. Specifically, the following prioritization table presents the results for the individual qualitative guiding factors evaluated in the Monsanto Qualitative Risk Check Report ( EPA 2001e). In addition, the table also identifies which prioritization grouping the overall facility was assigned to using the risk based facility prioritization strategy. The paragraph following the prioritization table provides further justification supporting why the facility was assigned to its specific prioritization grouping. 113 OVERALL RISK BASED FACILITY PRIORITIZATION QUALITATIVE GUIDING FACTOR PRIORITIZATION GROUPING Low Medium High Section <IP_ADDRESS>   Volumes and Types of Waste Being Burned

Section <IP_ADDRESS>   Emissions Quantification

Section 2.2.2   Other On site and Off site Emission Sources

Section <IP_ADDRESS>   Terrain Characteristics

Section <IP_ADDRESS>   Land Use for Dispersion Coefficients and Surface Roughness

Section <IP_ADDRESS>   Building Wake Effects

Section <IP_ADDRESS>   Particle Size Distribution

Section <IP_ADDRESS>   Meteorological Conditions

Section <IP_ADDRESS>   Physical Source Parameters

Section <IP_ADDRESS>   ( Receptor) Grid Node Array

Section 4.2.1   Type of Receptors and Exposure Scenario( s)

Section 4.2.2   Proximity to Exposure Scenario Location

Section 4.2.3   Presence or Absence and Proximity of Water Bodies and Water Sheds

Section 4.2.4   Proximity to Special Subpopulations

Section 4.2.5   Presence or Absence and Proximity of Ecological Areas

Section 4.2.6   Public Concerns

Monsanto August, Georgia Risk based Prioritization Grouping: medium Based on ( 1) a review of the individual qualitative guiding factors and their associated groupings presented in the above table, and ( 2) consideration of how each qualitative guiding factor interrelates collectively,

Monsanto has been assigned to the medium prioritization group utilizing the overall risk based prioritization strategy. The medium designation is intended to heighten the awareness of several key factors that indicate an increased potential for adverse impacts to human health and the environment. However, 114 when compared with facilities assigned to the high prioritization grouping, Monsanto's potential risk impacts are clearly lower than those facilities. In addition, even though several individual guiding factors were assigned to the high prioritization grouping, there is less additive interaction between the qualitative guiding factors for this facility and increased uncertainty, which limits definitive qualitative conclusions.

Specifically, the decision to assign Monsanto to the medium prioritization grouping is supported by the following key factors:

Monsanto generates and treats an estimated 343 million pounds of hazardous waste annually in the on site incinerator and two boilers. In comparison, most facilities ranked in the low prioritization group treat significantly less hazardous waste and only operate one hazardous waste combustor.

Monsanto is permitted to burn most RCRA D, F, P, and U listed wastes, including known PBTs and common risk drivers. In comparison, facilities ranked in the low prioritization group typically treat waste that is better characterized and does not contain PBTs or common risk drivers.

Monsanto has not performed a trial burn designed to support a site specific risk assessment; therefore, information on actual stack emission is limited.

Presence of residential, farmer, fisher, and acute exposure scenarios located within 3 kilometers of the Monsanto Facility. Facilities in the high prioritization grouping typically have sources that are located within 1 to 1.5 kilometers of the facility boundary.

Presence and proximity of numerous water bodies and their associated watersheds, several of which ( e. g., Clay Ponds) are located within 2.0 kilometers from the facility boundary. In addition, the clay Ponds exhibit several characteristics ( e. g., small, low volumetric flow rates) that may result in increased water body concentrations.

Presence of threatened or endangered species ( e. g., wood stork and red cockaded woodpecker) in the study area. However, it should be noted that their presence within close proximity or within the facility boundary has not been confirmed.

For a detailed discussion on site specific qualitative guiding factors, refer to the Monsanto Qualitative Risk Check Report ( EPA 2001e). Several individual qualitative guiding factors assigned to the medium and high prioritization groupings indicate an increased potential for adverse risk impacts. Specifically, the volumes and type of wastes and associated emissions are considered significant; however, since actual and potential future exposure scenarios are not located within close proximity ( i. e., 1 to 2 kilometers) to the facility boundary, Monsanto was believed to be better represented by the medium prioritization grouping.

In addition, when compared to the 12 other facilities included in this report, Monsanto consistently exhibited characteristics associated with the those facilities assigned to the medium prioritization grouping. 115 Therefore, based on a review of site specific characteristics and a comparison to the other facilities in this report, Monsanto is best represented by facilities assigned to the medium priority grouping and lacks commonalities or similar site specific conditions associated with facilities assigned to the low and high priority groupings.

As discussed in Section 1.2, placement into the medium prioritization group confirms the need for a sitespecific risk assessment since facilities in this grouping have an increased potential to contribute to adverse impacts to human health and the environment. Further, consistent with the findings presented in the Monsanto Qualitative Risk Check Report ( EPA 2001e), a site specific quantitative risk assessment at the Monsanto facility is recommended to provide the facility and permitting authority with the information necessary to assess potential liabilities and ensure the protection of human health and the environment.

2.11.3 MACT Based Facility Prioritization This section describes the process and findings relative to assigning Monsanto to one of the three prioritization groupings based on the MACT based facility prioritization strategy. The following prioritization table presents results for the individual qualitative guiding factors evaluated in the Monsanto Qualitative Risk Check Report ( EPA 2001e). In addition, the table also identifies which facility specific prioritization group the Monsanto facility was assigned to. The paragraph following the prioritization table provides the basis for why the facility was assigned to a specific prioritization grouping. 116 MACT BASED FACILITY PRIORITIZATION TABLE QUALITATIVE GUIDING FACTORS PRIORITIZATION GROUPING Low Medium High Section <IP_ADDRESS>   Volumes and Types of Waste Being Burned

Section <IP_ADDRESS>   Emissions Quantification

Section 2.2.2   Other On site and Off site Emission Sources

Section <IP_ADDRESS>   Terrain Characteristics

Section <IP_ADDRESS>   Land Use for Dispersion Coefficients and Surface Roughness

Section <IP_ADDRESS>   Building Wake Effects

Section <IP_ADDRESS>   Particle Size Distribution

Section <IP_ADDRESS>   Meteorological Conditions

Section <IP_ADDRESS>   Physical Source Parameters Section <IP_ADDRESS>   ( Receptor) Grid Node Array

Section 4.2.1   Type of Receptors and Exposure Scenario( s)

Section 4.2.2   Proximity to Exposure Scenario Location

Section 4.2.3   Presence or Absence and Proximity of Water Bodies and Water Sheds

Section 4.2.4   Proximity to Special Subpopulations

Section 4.2.5   Presence or Absence and Proximity of Ecological Areas

Section 4.2.6   Public Concerns

Monsanto Augusta, Georgia MACT based Prioritization Grouping: Medium As discussed in Section 1.1, while Phase I MACT standards do not apply to facilities operating hazardous waste fueled boilers, it is believed that the development of future Phase II MACT standards, which will apply to facilities operating boilers, will also include a national MACT risk assessment. With this assumption in mind, it is also believed that the qualitative guiding factors listed in section 1.0 and the known limitations of the Phase I national MACT risk assessment will also apply to boilers. As a result, the 117 same criteria for evaluating and assigning facilities that are subject to Phase I MACT standards to one of the three prioritization groupings utilizing the MACT based facility prioritization strategy are also applied to facilities with boilers. Based on ( 1) a review of the individual qualitative guiding factors and their associated groupings presented in the table above, and ( 2) consideration of how each qualitative guiding factor interrelates collectively, Monsanto has been assigned to the medium prioritization group utilizing the MACT based prioritization strategy. In addition, when compared with the 12 other facilities included in this summary report, Monsanto clearly exhibits multiple complicating factors that individually or collectively support its designation in the medium prioritization group. This designation is intended to heighten the awareness of several key factors that indicate the potential for remaining adverse risk impacts even after compliance with current and future MACT Standards. Specifically, the decision to assign Monsanto to the medium prioritization grouping is supported by the following key factors:

Presence of moderately characterized waste feed known or permitted to contain chemicals not covered under current MACT standards nor anticipated to be covered under future MACT Standards ( e. g., non dioxin PICs). Since current MACT limits do not apply to all stack emissions and future MACT limits are not expected to, the potential for adverse health impacts from these emissions exists. In comparison with the low and high prioritization groupings, Monsanto exhibits multiple site specific characteristics which indicate an increased potential from those facilities in the low grouping, and lack complex individual and additive qualitative guiding factors indicative of the high priority grouping.

Presence of other significant on site sources, including the presence of one incinerator, two boilers, and associated fugitive emission sources. Fugitive emission sources were not evaluated in the national MACT risk assessment conducted to support the development of current Phase I MACT Standards, nor are they expected to be considered during the national MACT risk assessment conducted during the development of future Phase II MACT Standards. The fact that fugitive emissions have been established at the Monsanto facility indicates a clear increased potential for adverse impacts. In addition, when compared with facilities assigned to the low and high prioritization groupings, Monsanto emits larger quantities of fugitive emissions than those typically associated with facilities assigned to the low prioritization grouping; however, the types of compounds emitted as fugitive emissions are not known risk drivers, as the compounds emitted by facilities in the high prioritization grouping usually are.

Presence of off site emission sources, including the DSM facility, which is located within 1 kilometer of the Monsanto facility boundary. Aggregate off site emission sources were not included in the national MACT risk assessment supporting Phase I MACT limits and are not expected to be included in the national MACT risk assessment anticipated to support Phase II MACT limits. The presence of other hazardous waste combustion facilities in close proximity to the Monsanto facility indicates an increased potential for adverse impacts to receptors. 118

Utilizing the same modeling methodologies presented in the national MACT risk assessment for selecting the appropriate terrain option would result in the misclassification of terrain in the Monsanto assessment area. This mis classification increases the potential that concentration and deposition will be underestimated in areas with increased terrain. This issue is especially important in the Monsanto assessment area since many exposure scenario locations are located in areas of increased terrain. Since areas with increased terrain elevation are present in the assessment area, and many of them are known or capable of supporting the default exposure pathways, there is an increased potential that the national MACT risk assessment that supported Phase I MACT limits underestimated risk in these areas. Assuming that the methodology in performing the national MACT risk assessment supporting Phase II MACT limits will be the same, it will also likely underestimate risk in these areas. As a result, there is an increased potential that both the Phase I MACT limits and the Phase II MACT limits will result in higher risk estimates than originally predicted. Therefore, protection to human health and the environment under the Phase I or Phase II MACT standards cannot be confirmed without the introduction of additional site specific information and a site specific refinement to air dispersion modeling methodologies.

Particle size distributions utilized in the national MACT risk assessment to support Phase I MACT standards were not source specific, but were generalized based on combustion unit type. As stated above, it is assumed that the national MACT risk assessment to support Phase II MACT standards will utilize the same methodologies as those used in the national MACT risk assessment to support Phase I MACT standards. Defining particle size distribution by combustion unit type introduces significant uncertainty, thereby resulting in the inability to accurately quantify risk impacts. Due to this potentially significant uncertainty, protection based on compliance with current or future MACT limits cannot be inferred based on this methodology, but will require additional site specific risk assessment activities including introduction of representative particle size distribution data collected as part of a trial burn designed to support a sitespecific risk assessment.

The national MACT risk assessment to support Phase I MACT standards did not include an evaluation of acute exposure. Since actual and potential acute exposure scenario locations are located in close proximity to the facility and it is assumed that future MACT risk assessments will also not include an evaluation of acute exposure, no definitive conclusions regarding the protectiveness of MACT standards can be made without additional risk assessment activities.

The selection of representative water bodies in the national MACT risk assessment to support Phase I MACT limits may have been biased to meet multiple selection criteria, resulting in the potential for overlooking more heavily impacted water bodies and their associated watersheds, which may result in the underestimation of risk to receptors. Assuming that the national MACT risk assessment expected to be conducted to support Phase II MACT limits will follow the same methodology, protection based on compliance with Phase II MACT limits alone cannot be inferred, which further establishes the need for additional risk assessment activities. 119

Established presence of significant ecological habitats in close proximity to the Monsanto facility and ecological receptors, including threatened or endangered species. The national MACT Risk Assessment did not include a separate analysis or consideration of threatened or endangered species. Based on the assumption that future MACT risk assessment will also not include an evaluation of threatened or endangered species, there is an increased potential that current and future MACT standards may not ensure protection of human health and the environment.

For a detailed discussion on site specific qualitative guiding factors, refer to the Monsanto Qualitative Risk Check Report ( EPA 2001e). Further justification for assigning Monsanto to the medium prioritization grouping is based on the fact that while some of the qualitative guiding factors evaluated for this facility have been individually assigned to the low or high group, these individual factors alone do not justify prioritizing Monsanto into the low or high grouping. In addition, when compared with facilities in the low prioritization grouping, Monsanto clearly exhibits several unique site specific factors which indicate that future MACT standards may not satisfy RCRA protectiveness mandates. Furthermore, when compared with facilities in the high prioritization groupings, Monsanto clearly lacks the complex or additive relationships between qualitative guiding factors, which are common to those facilities assigned to the high prioritization grouping.

As discussed in Section 1.2, placement into the medium prioritization group confirms the need for conducting additional site specific risk assessment activities, since facilities in this grouping have an increased potential for contributing to adverse health impacts. Therefore, as consistent with the Monsanto Qualitative Risk Check Report ( EPA 2001e), additional site specific risk assessment activities are still warranted and will help both the facility and permitting authority demonstrate that compliance with current and future MACT standards meet the requirements of the RCRA omnibus provisions.


[Federal Register Volume 80, Number 148 (Monday, August 3, 2015)]
[Notices]
[Pages 46028-46032]
[FR Doc No: 2015-18914]

-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2015-N-0007]

Prescription Drug User Fee Rates for Fiscal Year 2016

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Food and Drug Administration (FDA) is announcing the rates
for prescription drug user fees for fiscal year (FY) 2016. The Federal
Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the
Prescription Drug User Fee Amendments of 2012 (PDUFA V), authorizes FDA
to collect user fees for certain applications for the review of human
drug and biological products, on establishments where the products are
made, and on such products. This notice establishes the fee rates for
FY 2016.

FOR FURTHER INFORMATION CONTACT: Robert J. Marcarelli, Office of
Financial Management, Food and Drug Administration, 8455 Colesville
Rd., COLE-14202F, Silver Spring, MD 20993-0002,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Background

    Sections 735 and 736 of the FD&C Act (21 U.S.C. 379g and 379h,
respectively) establish three different kinds of user fees. Fees are
assessed on the following: (1) Certain types of applications and
supplements for the review of human drug and biological products; (2)
certain establishments where such products are made; and (3) certain
products (section 736(a) of the FD&C Act). When certain conditions are
met, FDA may waive or reduce fees (section 736(d) of the FD&C Act).
    For FY 2013 through FY 2017, the base revenue amounts for the total
revenues from all PDUFA fees are established by PDUFA V. The base
revenue amount for FY 2013, which became the base amount for the
remaining 4 FYs of PDUFA V, is $718,669,000, as published in the
Federal Register of August 1, 2012 (77 FR 45639). The FY 2013 base
revenue amount is further adjusted each year after FY 2013 for
inflation and workload. Fees for applications, establishments, and
products are to be established each year by FDA so that revenues from
each category will provide one-third of the total revenue to be
collected each year.
    This document provides fee rates for FY 2016 for an application
requiring

clinical data ($2,374,200), for an application not requiring clinical
data or a supplement requiring clinical data ($1,187,100), for an
establishment ($585,200), and for a product ($114,450). These fees are
effective on October 1, 2015, and will remain in effect through
September 30, 2016. For applications and supplements that are submitted
on or after October 1, 2015, the new fee schedule must be used.
Invoices for establishment and product fees for FY 2016 will be issued
in August 2015 using the new fee schedule.

II. Fee Revenue Amount for FY 2016

    The base revenue amount for FY 2016 is $718,669,000 prior to
adjustments for inflation and workload (see section 736(c)(1) and
(c)(2) of the FD&C Act).

A. FY 2016 Statutory Fee Revenue Adjustments for Inflation

    PDUFA V specifies that the $718,669,000 is to be further adjusted
for inflation increases for FY 2016 using two separate adjustments--one
for personnel compensation and benefits (PC&B) and one for non-PC&B
costs (see section 736(c)(1) of the FD&C Act).
    The component of the inflation adjustment for payroll costs shall
be 1 plus the average annual percent change in the cost of all PC&B
paid per full-time equivalent (FTE) position at FDA for the first 3 of
the preceding 4 FYs, multiplied by the proportion of PC&B costs to
total FDA costs of process for the review of human drug applications
for the first 3 of the preceding 4 FYs (see section 736(c)(1)(A) and
(c)(1)(B) of the FD&C Act).
    Table 1 summarizes that actual cost and FTE data for the specified
FYs, and provides the percent changes from the previous FYs and the
average percent changes over the first 3 of the 4 FYs preceding FY
2016. The 3-year average is 2.2328 percent.

              Table 1--FDA Personnel Compensation and Benefits (PC&B) Each Year and Percent Changes
----------------------------------------------------------------------------------------------------------------
             Fiscal year                     2012               2013               2014          3-Year average
----------------------------------------------------------------------------------------------------------------
Total PC&B..........................     $1,824,703,000     $1,927,703,000     $2,054,937,000  .................
Total FTE...........................             13,382             13,974             14,555  .................
PC&B per FTE........................           $136,355           $137,949           $141,184  .................
Percent Change From Previous Year...            3.1843%            1.1690%            2.3451%            2.2328%
----------------------------------------------------------------------------------------------------------------

    The statute specifies that this 2.2328 percent should be multiplied
by the proportion of PC&B costs to total FDA costs of the process for
the review of human drug applications. Table 2 shows the PC&B and the
total obligations for the process for the review of human drug
applications for 3 FYs.

                        Table 2--PC&B as a Percent of Fee Revenues Spent on the Process for the Review of Human Drug Applications
--------------------------------------------------------------------------------------------------------------------------------------------------------
                     Fiscal year                                2012                     2013                     2014                3-Year average
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total PC&B..........................................             $592,642,252             $568,206,210             $585,260,720  .......................
Total Costs.........................................           $1,032,419,218             $966,169,007           $1,077,263,695  .......................
PC&B Percent........................................                 57.4033%                 58.8102%                 54.3285%                 56.8473%
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The payroll adjustment is 2.2328 percent from table 1 multiplied by
56.8473 percent (or 1.2693 percent).
    The statute specifies that the portion of the inflation adjustment
for non-payroll costs is the average annual percent change that
occurred in the Consumer Price Index (CPI) for urban consumers
(Washington-Baltimore, DC-MD-VA-WV; not seasonally adjusted; all items;
annual index) for the first 3 years of the preceding 4 years of
available data multiplied by the proportion of all costs other than
PC&B costs to total costs of the process for the review of human drug
applications for the first 3 years of the preceding 4 FYs (see section
736(c)(1)(C) of the FD&C Act). Table 3 provides the summary data for
the percent changes in the specified CPI for the Washington-Baltimore
area. The data are published by the Bureau of Labor Statistics and can
be found on their Web site at http://data.bls.gov/cgi-bin/surveymost?cu
by checking the box marked ``Washington-Baltimore All Items, November
1996=100--CUURA311SA0'' and then clicking on the ``Retrieve Data''
button.

                                 Table 3--Annual and 3-Year Average Percent Change in CPI for Washington-Baltimore Area
--------------------------------------------------------------------------------------------------------------------------------------------------------
                        Year                                    2012                     2013                     2014                3-Year average
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annual CPI..........................................                  150.212                  152.500                  154.847  .......................
Annual Percent Change...............................                  2.2024%                  1.5232%                  1.5390%                  1.7549%
--------------------------------------------------------------------------------------------------------------------------------------------------------

    To calculate the inflation adjustment for non-payroll costs, we
multiply the 1.7549 percent by the proportion of all costs other than
PC&B to total costs of the process for the review of human drug
applications obligated. Since 56.8473 percent was obligated for PC&B as
shown in table 2, 43.1527 percent is the portion of costs other than
PC&B (100 percent minus 56.8473 percent equals 43.1527 percent). The
non-payroll adjustment is 1.7549 percent times 43.1527 percent, or
0.7573 percent.
    Next, we add the payroll adjustment (1.2693 percent) to the non-
payroll adjustment (0.7573 percent), for a total inflation adjustment
of 2.0266 percent (rounded) for FY 2016.
    PDUFA V provides for this inflation adjustment to be compounded
after FY 2013 (see section 736(c)(1) of the FD&C Act). This factor for
FY 2016 (2.0266 percent) is compounded by adding 1

and then multiplying by 1 plus the compound inflation adjustment factor
for FY 2015 (4.327 percent), as published in the Federal Register of
August 1, 2014 (79 FR 44807 at 44809), which equals to 1.064414
(rounded) (1.020266 times 1.04327) for FY 2016. We then multiply the
base revenue amount for FY 2016 ($718,669,000) by 1.064414, yielding an
inflation-adjusted amount of $764,961,345.

B. FY 2016 Statutory Fee Revenue Adjustments for Workload

    The statute specifies that after the $718,669,000 has been adjusted
for inflation, the inflation-adjusted amount shall be further adjusted
for workload (see section 736(c)(2) of the FD&C Act).
    To calculate the FY 2016 workload adjustment, FDA calculated the
average number of each of the four types of applications specified in
the workload adjustment provision: (1) Human drug applications; (2)
active commercial investigational new drug applications (INDs)
(applications that have at least one submission during the previous 12
months); (3) efficacy supplements; and (4) manufacturing supplements
received over the 3-year period that ended on June 30, 2012 (base
years), and the average number of each of these types of applications
over the most recent 3 year period that ended June 30, 2015.
    The calculations are summarized in table 4. The 3-year averages for
each application category are provided in column 1 (``3-Year Average
Base Years 2010-2012'') and column 2 (``3-Year Average 2013-2015'').
Column 3 reflects the percent change in workload from column 1 to
column 2. Column 4 shows the weighting factor for each type of
application, estimating how much of the total FDA drug review workload
was accounted for by each type of application in the table during the
most recent 3 years. Column 5 is the weighted percent change in each
category of workload. This was derived by multiplying the weighting
factor in each line in column 4 by the percent change from the base
years in column 3. The sum of the values in column 5 is added,
reflecting an increase in workload of 11.31 percent (rounded) for FY
2016 when compared to the base years.

                               Table 4--Workload Adjuster Calculation for FY 2016
----------------------------------------------------------------------------------------------------------------
                                     Column 1        Column 2        Column 3        Column 4        Column 5
                                 -------------------------------------------------------------------------------
        Application type              3-Year          3-Year      Percent change     Weighting
                                   average base   average  2013-    (column 1 to      factor         Weighted
                                    years 2010-        2015          column 2)       (percent)    percent change
---------------------------------------2012---------------------------------------------------------------------
New Drug Applications/Biologics            124.3           148.3         19.3081            38.9            7.51
 License Applications...........
Active Commercial INDs..........          6830.0          7375.3          7.9839            39.2            3.13
Efficacy Supplements............           136.3           175.0         28.3933             6.0            1.69
Manufacturing Supplements.......          2548.3          2386.7         -6.3415            16.0           -1.01
FY 2016 Workload Adjuster.......  ..............  ..............  ..............  ..............           11.31
----------------------------------------------------------------------------------------------------------------

    Table 5 shows the calculation of the revenue amount for FY 2016.
The $718,669,000 subject to adjustment on Line 1 is multiplied by the
inflation adjustment factor of 1.064414, resulting in the inflation-
adjusted amount on Line 3, $764,961,345. That amount is then multiplied
by one plus the workload adjustment of 11.31 percent, resulting in the
inflation and workload adjusted amount of $851,481,000 on Line 5,
rounded to the nearest thousand dollars.

     Table 5--PDUFA Revenue Amount for FY 2016, Summary Calculation
------------------------------------------------------------------------

------------------------------------------------------------------------
FY 2013 Revenue Amount and Base       $718,669,000  Line 1.
 Subsequent FYs as published in
 the Federal Register of August 1,
 2012 (77 FR 45639) (Rounded to
 nearest thousand dollars).
Inflation Adjustment Factor for FY        1.064414  Line 2.
 2016 (1 plus 6.4414 percent).
Inflation Adjusted Amount.........    $764,961,345  Line 3.
Workload Adjustment Factor for FY           1.1131  Line 4.
 2016 (1 plus 11.31 percent).
Inflation and Workload Adjusted       $851,481,000  Line 5.
 Amount (Rounded to nearest
 thousand dollars).
------------------------------------------------------------------------

    PDUFA specifies that one-third of the total fee revenue is to be
derived from application fees, one-third from establishment fees, and
one-third from product fees (see section 736(b)(2) of the FD&C Act).
Accordingly, one-third of the total revenue amount ($851,481,000), or a
total of $283,827,000, is the amount of fee revenue that will be
derived from each of these fee categories: Application Fees,
Establishment Fees, and Product Fees.

III. Application Fee Calculations

A. Application Fee Revenues and Application Fees

    Application fees will be set to generate one-third of the total fee
revenue amount, or $283,827,000 in FY 2016.

B. Estimate of the Number of Fee-Paying Applications and Setting the
Application Fees

    For FY 2013 through FY 2017, FDA will estimate the total number of
fee-paying full application equivalents (FAEs) it expects to receive
the next FY by averaging the number of fee-paying FAEs received in the
3 most recently completed FYs. Beginning with FY 2016, prior year FAE
totals will be updated annually to reflect refunds and waivers
processed after the close of the FY.
    In estimating the number of fee-paying FAEs, a full application
requiring clinical data counts as one FAE. An application not requiring
clinical data counts as one-half of an FAE, as does a supplement
requiring clinical data. An application that is withdrawn, or refused
for filing, counts as one-fourth of an FAE if the applicant initially
paid a full application fee, or one-eighth of an FAE if the applicant
initially paid one-half of the full application fee amount.
    As table 6 shows, the average number of fee-paying FAEs received
annually in the most recent 3-year period is 119.545 FAEs. FDA will set
fees for FY 2016 based on this estimate as the number of

full application equivalents that will pay fees.

                                     Table 6--Fee-Paying FAE 3-Year Average
----------------------------------------------------------------------------------------------------------------
                       FY                              2012            2013            2014       3-Year average
----------------------------------------------------------------------------------------------------------------
Fee-Paying FAEs.................................         120.375         109.510         128.750         119.545
----------------------------------------------------------------------------------------------------------------
Beginning with FY 2016, prior year FAE totals will be updated annually to reflect refunds and waivers processed
  after the close of the FY.

    The FY 2016 application fee is estimated by dividing the average
number of full applications that paid fees over the latest 3 years,
119.545, into the fee revenue amount to be derived from application
fees in FY 2016, $283,827,000. The result, rounded to the nearest
hundred dollars, is a fee of $2,374,200 per full application requiring
clinical data, and $1,187,100 per application not requiring clinical
data or per supplement requiring clinical data.

IV. Fee Calculations for Establishment and Product Fees

A. Establishment Fees

    At the beginning of FY 2015, the establishment fee was based on an
estimate that 509 establishments would be subject to and would pay
fees. By the end of FY 2015, FDA estimates that 516 establishments will
have been billed for establishment fees, before all decisions on
requests for waivers or reductions are made. FDA estimates that a total
of 15 establishment fee waivers or reductions will be made for FY 2015.
In addition, FDA estimates that another 16 full establishment fees will
be exempted this year based on the orphan drug exemption in section
736(k) of the FD&C Act. Subtracting 31 establishments (15 waivers, plus
the estimated 16 establishments under the orphan exemption) from 516
leaves a net of 485 fee-paying establishments. FDA will use 485 to
estimate the FY 2016 establishments paying fees. The fee per
establishment is determined by dividing the adjusted total fee revenue
to be derived from establishments ($283,827,000) by the estimated 485
establishments, for an establishment fee rate for FY 2016 of $585,200
(rounded to the nearest hundred dollars).

B. Product Fees

    At the beginning of FY 2015, the product fee was based on an
estimate that 2,434 products would be subject to and would pay product
fees. By the end of FY 2015, FDA estimates that 2,554 products will
have been billed for product fees, before all decisions on requests for
waivers, reductions, or exemptions are made. FDA assumes that there
will be 39 waivers and reductions granted. In addition, FDA estimates
that another 35 product fees will be exempted this year based on the
orphan drug exemption in section 736(k) of the FD&C Act. FDA estimates
that 2,480 products will qualify for and pay product fees in FY 2015,
after allowing for an estimated 74 waivers and reductions, including
the orphan drug products, and will use this number for its FY 2016
estimate. The FY 2016 product fee rate is determined by dividing the
adjusted total fee revenue to be derived from product fees
($283,827,000) by the estimated 2,480 products for a FY 2016 product
fee of $114,450 (rounded to the nearest ten dollars).

V. Fee Schedule for FY 2016

    The fee rates for FY 2016 are displayed in table 7:

                    Table 7--Fee Schedule for FY 2016
------------------------------------------------------------------------
                                                           Fee rates for
                      Fee category                            FY 2016
------------------------------------------------------------------------
Applications:
    Requiring clinical data.............................      $2,374,200
    Not requiring clinical data.........................       1,187,100
    Supplements requiring clinical data.................       1,187,100
Establishments..........................................         585,200
Products................................................         114,450
------------------------------------------------------------------------

VI. Fee Payment Options and Procedures

A. Application Fees

    The appropriate application fee established in the new fee schedule
must be paid for any application or supplement subject to fees under
PDUFA that is received on or after October 1, 2015. Payment must be
made in U.S. currency by check, bank draft, or U.S. postal money order
payable to the order of the Food and Drug Administration. Please
include the user fee identification (ID) number on your check, bank
draft, or postal money order. Your payment can be mailed to: Food and
Drug Administration, P.O. Box 979107, St. Louis, MO 63197-9000.
    If checks are to be sent by a courier that requests a street
address, the courier can deliver the checks to: U.S. Bank, Attention:
Government Lockbox 979107, 1005 Convention Plaza, St. Louis, MO 63101.
(Note: This U.S. Bank address is for courier delivery only. Contact the
U.S. Bank at<PHONE_NUMBER> if you have any questions concerning courier
delivery.)
    Please make sure that the FDA post office box number (P.O. Box
979107) is written on the check, bank draft, or postal money order.
    Wire transfer payment may also be used. Please reference your
unique user fee ID number when completing your transfer. The
originating financial institution may charge a wire transfer fee.
Please ask your financial institution about the fee and add it to your
payment to ensure that your fee is fully paid. The account information
for wire transfers is as follows: New York Federal Reserve Bank, U.S.
Department of the Treasury, TREAS NYC, 33 Liberty St., New York, NY
10045, Acct. No.: 75060099, Routing No.: 021030004, SWIFT: FRNYUS33,
Beneficiary: FDA, 8455 Colesville Rd., 14th Floor, Silver Spring, MD
20993-0002.

    Application fees can also be paid online with an electronic check
(ACH). FDA has partnered with the U.S. Department of the Treasury to
use Pay.gov, a Web-based payment application, for online electronic
payment. The Pay.gov feature is available on the FDA Web site after the
user fee ID number is generated.
    The tax identification number of FDA is 53-0196965.

B. Establishment and Product Fees

    FDA will issue invoices for establishment and product fees for FY
2016 under the new fee schedule in August 2015. Payment will be due on
October 1, 2015. FDA will issue invoices in November 2016 for any
products and establishments subject to fees for FY 2016 that qualify
for fee assessments after the August 2015 billing.

    Dated: July 28, 2015.
Leslie Kux,
Associate Commissioner for Policy.
[FR Doc. 2015-18914 Filed 7-31-15; 8:45 am]
BILLING CODE 4164-01-P