[Federal Register Volume 80, Number 148 (Monday, August 3, 2015)]
[Notices]
[Pages 45971-45972]
[FR Doc No: 2015-18963]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

Combined Notice of Filings #1

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

    Docket Numbers: ER10-3246-005.
    Applicants: PacifiCorp.
    Description: Notice of Change in Status of PacifiCorp.
    Filed Date: 7/27/15.
    Accession Number: 20150727-5229.
    Comments Due: 5 p.m. ET 8/17/15.

    Docket Numbers: ER12-2068-008; ER15-1471-001; ER10-2460-008; ER10-
2461-008; ER12-682-009; ER10-2463-008; ER15-1672-001; ER11-2201-012;
ER10-2464-005; ER13-1139-011; ER13-1585-005; ER10-2465-004; ER11-2657-
005; ER13-17-006; ER14-2630-004; ER12-1311-008; ER10-2466-009; ER11-
4029-008; ER12-2205-005; ER12-2159-004; ER10-1821-009; ER12-919-003.
    Applicants: Blue Sky East, LLC, Blue Sky West, LLC, Canandaigua
Power Partners, LLC, Canandaigua Power Partners II, LLC, Erie Wind,
LLC, Evergreen Wind Power, LLC, Evergreen Wind Power II, LLC, Evergreen
Wind Power III, LLC, First Wind Energy Marketing, LLC, Imperial Valley
Solar 1, LLC Longfellow Wind, LLC, Milford Wind Corridor Phase I, LLC,
Milford Wind Corridor Phase II, LLC, Niagara Wind Power, LLC, Regulus
Solar, LLC, Stetson Holdings, LLC, Stetson Wind II, LLC, Vermont Wind,
LLC, Meadow Creek Project Company LLC, Canadian Hills Wind, LLC, Goshen
Phase II LLC, Rockland Wind Farm LLC.
    Description: Notice of Change in Status of Blue Sky East, LLC, et.
al. under ER12-2068, et. al.
    Filed Date: 7/27/15.
    Accession Number: 20150727-5227.
    Comments Due: 5 p.m. ET 8/17/15.

    Docket Numbers: ER15-1939-001.
    Applicants: Southwest Power Pool, Inc.
    Description: Tariff Amendment: 3050 Substitute Sunwind Energy Group
GIA to be effective 6/3/2015.
    Filed Date: 7/28/15.
    Accession Number: 20150728-5073.
    Comments Due: 5 p.m. ET 8/18/15.

    Docket Numbers: ER15-2260-000.
    Applicants: PJM Interconnection, L.L.C.
    Description: Sec.  205(d) Rate Filing: Compliance Filing per 3/20/
14 Order in Docket No. EL14-24-000 and Order 809 to be effective 4/1/
2016.
    Filed Date: 7/23/15.
    Accession Number: 20150723-5137.
    Comments Due: 5 p.m. ET 8/13/15.

    Docket Numbers: ER15-2283-000.
    Applicants: PacifiCorp.
    Description: Sec.  205(d) Rate Filing: Amendment to Market-Based
Rate Tariff--EIM to be effective 9/26/2015.
    Filed Date: 7/27/15.
    Accession Number: 20150727-5167.
    Comments Due: 5 p.m. ET 8/17/15.

    Docket Numbers: ER15-2284-000.
    Applicants: PacifiCorp.
    Description: Tariff Cancellation: Termination of Exelon EIM
Participation Construction Agreement to be effective 9/10/2015.
    Filed Date: 7/27/15.
    Accession Number: 20150727-5169.
    Comments Due: 5 p.m. ET 8/17/15.

    Docket Numbers: ER15-2285-000.
    Applicants: New York Independent System Operator, Inc.
    Description: Sec.  205(d) Rate Filing: NYISO 205 filing of SGIA
among NYISO, NMPC and Monroe County to be effective 7/13/2015.
    Filed Date: 7/27/15.
    Accession Number: 20150727-5170.
    Comments Due: 5 p.m. ET 8/17/15.

    Docket Numbers: ER15-2286-000.
    Applicants: PJM Interconnection, L.L.C.

    Description: Sec.  205(d) Rate Filing: First Revised Service
Agreement No. 4030; Queue No. AA1-102 to be effective 6/26/2015.
    Filed Date: 7/27/15.
    Accession Number: 20150727-5172.
    Comments Due: 5 p.m. ET 8/17/15.

    Docket Numbers: ER15-2287-000.
    Applicants: Midcontinent Independent System Operator, Inc.
    Description: Sec.  205(d) Rate Filing: 2015-07-28_SA 2753 NSP-Red
Pine Wind 1st Rev GIA (H081) to be effective 7/29/2015.
    Filed Date: 7/28/15.
    Accession Number: 20150728-5055.
    Comments Due: 5 p.m. ET 8/18/15.

    Take notice that the Commission received the following land
acquisition reports:

    Docket Numbers: LA15-2-000.
    Applicants: Northern States Power Company, a Minnesota corporation,
Xcel Energy Inc.
    Description: Quarterly Land Acquisition Report of Northern States
Power Company, a Minnesota corporation, et. al.
    Filed Date: 7/28/15.
    Accession Number: 20150728-5034.
    Comments Due: 5 p.m. ET 8/18/15.

    Docket Numbers: LA15-2-000.
    Applicants: Blackstone Wind Farm, LLC, Blackstone Wind Farm II LLC,
Flat Rock Windpower LLC, Flat Rock Windpower II LLC, Headwaters Wind
Farm LLC, High Prairie Wind Farm II, LLC, High Trail Wind Farm, LLC,
Lone Valley Solar Park I LLC, Lone Valley Solar Park II LLC, Lost Lakes
Wind Farm LLC, Marble River, LLC, Meadow Lake Wind Farm LLC, Meadow
Lake Wind Farm II LLC, Meadow Lake Wind Farm III LLC, Meadow Lake Wind
Farm IV LLC, Old Trail Wind Farm, LLC, Paulding Wind Farm II LLC,
Pioneer Prairie Wind Farm I LLC, Rail Splitter Wind Farm, LLC, Rising
Tree Wind Farm LLC, Rising Tree Wind Farm II LLC, Rising Tree Wind Farm
III LLC, Sustaining Power Solutions LLC.
    Description: Quarterly Land Acquisition Report of Blackstone Wind
Farm, LLC, et. al.
    Filed Date: 7/28/15.
    Accession Number: 20150728-5035.
    Comments Due: 5 p.m. ET 8/18/15.

    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: July 28, 2015.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2015-18963 Filed 7-31-15; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register: September 2, 2010 (Volume 75, Number 170)]
[Notices]
[Page 53999]
[DOCID:fr02se10-99]

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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

Notice of Applications for Certificates of Public Convenience and
Necessity and Foreign Air Carrier Permits Filed Under Subpart B
(Formerly Subpart Q) During the Week Ending August 14, 2010

    The following Applications for Certificates of Public Convenience
and Necessity and Foreign Air Carrier Permits were filed under Subpart
B (formerly Subpart Q) of the Department of Transportation's Procedural
Regulations (See 14 CFR 301.201 et. seq.). The due date for Answers,
Conforming Applications, or Motions to Modify Scope are set forth below
for each application. Following the Answer period DOT may process the
application by expedited procedures. Such procedures may consist of the
adoption of a show-cause order, a tentative order, or in appropriate
cases a final order without further proceedings.
    Docket Number: DOT-OST-2010-0215.
    Date Filed: August 13, 2010.
    Due Date for Answers, Conforming Applications, or Motion to Modify
Scope: September 3, 2010.
    Description: Application of National Air Cargo Group, Inc. d/b/a
National Airlines requesting it's certificate of public convenience and
necessity is amended to include authority for foreign charter air
transportation of persons, property and mail.

Renee V. Wright,
Program Manager, Docket Operations, Federal Register Liaison.
[FR Doc. 2010-21943 Filed 9-1-10; 8:45 am]
BILLING CODE 4910-9X-P


[Federal Register Volume 76, Number 240 (Wednesday, December 14, 2011)]
[Rules and Regulations]
[Pages 77716-77726]
[FR Doc No: 2011-31990]

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DEPARTMENT OF TRANSPORTATION

Federal Railroad Administration

49 CFR Part 269

[Docket No. FRA-2009-0108; Notice No. 2]
RIN 2130-AC19

Alternate Passenger Rail Service Pilot Program

AGENCY: Federal Railroad Administration (FRA), Department of
Transportation (DOT).

ACTION: Final rule.

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SUMMARY: This final rule is in response to a statutory mandate that FRA
complete a rulemaking proceeding to develop a pilot program that
permits a rail carrier or rail carriers that own infrastructure over
which Amtrak operates certain passenger rail service routes to petition
FRA to be considered as a passenger rail service provider over such a
route in lieu of Amtrak for a period not to exceed five years after the
date of enactment of the Passenger Rail Investment and Improvement Act
of 2008. The final rule develops this pilot program in conformance with
the statutory directive.

DATES: This final rule is effective on February 13, 2012.

FOR FURTHER INFORMATION CONTACT: Alexander Roth, Office of Railroad
Policy and Development, FRA, 1200 New Jersey Ave. SE., Washington, DC
20590 (telephone:<PHONE_NUMBER>); or Zeb Schorr, Attorney-Advisor,
Office of Chief Counsel, FRA, 1200 New Jersey Ave. SE., Mail Stop 10,
Washington, DC 20590 (telephone:<PHONE_NUMBER>).

SUPPLEMENTARY INFORMATION:

I. Background

    By notice of proposed rulemaking (NPRM) published on September 7,
2011 (76 FR 55335), FRA proposed an alternate passenger rail service
pilot program in response to a statutory mandate--specifically, Sec.
214 of the Passenger Rail Investment and Improvement Act of 2008
(PRIIA), Public Law No. 110-432, Division B (Oct. 16, 2008). The
comment period for the NPRM closed on November 7, 2011. FRA received
written comments submitted by Ratp Development America, the
Transportation Trades Department of the AFL-CIO, the American Short
Line and Regional Railroad Association, the Association of Independent
Passenger Rail Operators, Herzog Transit Services, Inc., First Transit,
Veolia Transportation N.A., and two individuals.
    General comments are addressed in this section, and more specific
comments are addressed in the relevant sections of the preamble below.
Some comments were generally supportive of the NPRM, and other comments
were generally unsupportive of the NPRM.
    A comment sought clarification regarding whether an eligible rail
carrier under the pilot program could create a separate company to
manage and operate the passenger operation, or whether it could enter
into a private access rights agreement with an alternative rail
passenger operator. This final rule develops a pilot program that
permits a rail carrier or rail carriers that own infrastructure over
which Amtrak operates certain passenger rail service routes to petition
FRA to be considered as a passenger rail service provider over such a
route in lieu of Amtrak. This final rule does not prohibit an eligible
rail carrier from creating a separate company to manage and/or operate
the passenger rail service, or from entering into an agreement with a
third party to manage and/or operate the passenger rail service.
However, a pilot program petition must be submitted by a rail carrier
or rail carriers that own the infrastructure as described in Sec.
269.7 of this final rule. In addition, such information regarding the
management and/or operation of the service would be relevant to FRA's
evaluation of the bid, and should be described in detail pursuant to
Sec.  269.9 of this final rule.
    Several comments stated that the pilot program should allow a State
to submit a petition (with the concurrence of the infrastructure
owner), and/or that there should be a statutory role for States in the
pilot program. Comments also stated that State involvement is
particularly important to bidding on State-supported routes (which are
eligible under the pilot program) as such routes are largely funded by
States. A comment further stated that States should be able to
participate in the pilot program process both out of a matter of
fairness and to ensure that existing contracts between States and
Amtrak would not be unconstitutionally impaired. As an initial matter,
Sec.  214 of PRIIA only provides that a rail carrier or rail carriers
that own infrastructure over which Amtrak operates certain passenger
rail service routes may submit a petition. See 49 U.S.C. 24711(a)(1).
Section 214 does not establish a statutory role for States in the pilot
program petition process. In compliance with this statutory mandate,
this final rule provides that only an eligible rail carrier may submit
a petition. However, a State may participate in the pilot program
process. Specifically, a

petitioning rail carrier may include, in its bid package, documentation
of a State's approval of the bid for the particular State-supported
route. Indeed, Sec.  269.9(b)(4) of this final rule requires, in part,
that a bidder describe the sources of non-Federal funding, including
any State operating subsidy and any other State payments. See also 49
U.S.C. 24711(a)(3).
    Comments stated that the pilot program should include the right-of-
way owner as a full partner in the proposed service, and that the pilot
program should recognize the importance of protecting the capacity
required for freight operations. As an initial matter, FRA agrees that
freight railroads (and commuter railroads, for that matter) are
critical partners to the success of intercity passenger rail that makes
use of their facilities. Furthermore, the pilot program recognizes that
a bid submitted by an eligible rail carrier must describe how that rail
carrier would operate over right-of-way on the route that it does not
own. Specifically, Sec.  269.9 of this final rule requires a bidder to
describe the operating agreement(s) necessary for the operation of
passenger service over right-of-way on the route that is not owned by
the bidder.
    A comment stated that FRA should solicit the opinion of States on
how the pilot program, as applied to State-supported routes, could best
be made to successfully work. As noted, FRA published the proposed rule
in the Federal Register, but did not receive any comments from a State.
    Another comment contested the constitutionality of Sec.  201 of
PRIIA, which defines the national railroad passenger transportation
system, but did not relate the comment to the proposed rule.
    Lastly, one comment generally disagreed with the NPRM and stated
that a better way to meet the requirements of PRIIA would be to convert
Amtrak into a Sec.  501(c)(3) nonprofit corporation. FRA disagrees. As
discussed above, the NPRM (and this final rule) was in response to a
specific statutory mandate that FRA complete a rulemaking proceeding to
develop an alternate passenger rail service pilot program.

a. Summary of Final Rule

    This final rule is in response to a statutory mandate that FRA
complete a rulemaking proceeding to develop a pilot program that
permits a rail carrier or rail carriers that own infrastructure over
which Amtrak operates certain passenger rail service routes to petition
FRA to be considered as a passenger rail service provider over such a
route in lieu of Amtrak for a period not to exceed five years after
October 16, 2008 (the date of enactment of PRIIA). Section 214 further
provides that those routes described in 49 U.S.C. 24102(5)(B), (C), and
(D) and in 49 U.S.C. 24702 are eligible for the pilot program, and that
the program not be made available to more than two routes.
    Section 214 also provides for, among other things, the following:
The establishment of a petition, notification, and bid process through
which FRA would evaluate bids to provide passenger rail service over
particular routes by interested rail carriers and Amtrak; FRA's
selection of a winning bidder by, among other things, evaluating the
bids against the financial and performance metrics developed under
section 207 of PRIIA; FRA's execution of a contract with the winning
bidder awarding the right and obligation to provide passenger rail
service over the route, along with an operating subsidy, as well as
requiring compliance with the minimum standards established under
section 207 of PRIIA, among other things; that Amtrak must provide
access to its reservation system, stations, and facilities to a winning
bidder; that employees used in the operation of a route under the pilot
program would be considered an employee of that rail carrier and would
be subject to the applicable Federal laws and regulations governing
similar crafts or classes of employees of Amtrak; that the winning
bidder must provide hiring preference to displaced qualified Amtrak
employees; that the winning bidder would be subject to the grant
conditions under 49 U.S.C. 24405; and that, if a winning bidder ceases
to operate the service or to otherwise fulfill their obligations, the
FRA Administrator, in collaboration with the Surface Transportation
Board, would take any necessary action to enforce the contract and to
ensure the continued provision of service.

b. Adequate Resources Certification

    Section 214 provides that, before FRA may take any action allowed
under 49 U.S.C. 24711, the Secretary of Transportation (Secretary) must
certify that the FRA Administrator has sufficient resources that are
adequate to undertake the pilot program. FRA understands this
requirement to mean that FRA may not proceed with any action under a
pilot program developed by this final rule until the Secretary has
issued such a certification.
    It should also be noted that section 214 requires FRA to award to a
winning bidder, among other things, an operating subsidy. 49 U.S.C.
24711(a)(5)(B). PRIIA did not authorize funds for FRA to use to pay for
any such operating subsidy, or any other costs arising from the
proposed pilot program; nor did Congress appropriate funds for the
pilot program.
    Comments stated that the pilot program should allow for the
transfer of current and existing service subsidies made by FRA to
Amtrak to operators selected under the pilot program. However, FRA does
not have the authority to transfer any such existing subsidies. Other
comments stated that there should be a mechanism for FRA to award an
operating subsidy to pay for costs associated with the pilot program.
As described above, no funds have been appropriated to the FRA to
provide such financial assistance.
    A comment also stated that a mechanism needs to be created to
clearly identify the route by route subsidy and the method of transfer,
and that such information would be critical to a fair bidding process.
The comment goes on to suggest that FRA analyze and rank all Amtrak
routes (national and State-supported). In addition, the comment notes
that the cost allocation methodology of Sec.  209 of PRIIA should be
the basis for determining the appropriate subsidy amount for these
routes. FRA notes that useful route-by-route Amtrak cost information is
published in the Quarterly Report on the Performance and Service
Quality on Intercity Passenger Train Operations (available at http://www.fra.dot.gov/rpd/passenger/2165.shtml). FRA also notes that
avoidable cost outputs are not yet available, and that eight quarters
of comparable fully allocated cost data has not yet been accumulated.
However, waiting for this data, and for the States and Amtrak to arrive
at a final consensus on the Sec.  209 methodology, could potentially
delay publication of this final rule well beyond the expiration of the
pilot program itself (October 16, 2013). Furthermore, in order to be
competitive, prospective bidders will likely need to provide the
service at cost levels below those of Amtrak's. It is the bidder's
verifiable cost projections for their proposed service, rather than the
historical Amtrak costs, that will be particularly important in the
bidding process.
    This final rule incorporates the adequate resources certification
requirement by providing, in Sec.  269.3(a), that part 269 is not
applicable to any railroad, unless and until, the Secretary certifies
that FRA has sufficient resources that are adequate to undertake the
pilot program. Only upon such certification does the pilot program
become available. As described below,

the time period within which petitions may be filed with FRA is
triggered by FRA providing notice of the Secretary's certification.
    A comment stated that the Secretary must quickly certify that FRA
has adequate resources to undertake the program; the comment further
provided that substantial FRA resources would not be required for the
pilot program. The Secretary will issue this certification when
appropriate. In addition, it must be noted that FRA will expend
valuable resources in administering the pilot program, especially in
the thorough evaluation of each of the petitions and bid packages that
may be received.

c. Timeline Established by the Final Rule

    The final rule establishes deadlines for filing petitions, filing
bids, and FRA's execution of contract(s) with any winning bidders. As
to the filing of petitions, Sec.  269.7(b) of the final rule requires a
petition to be filed with FRA no later than 45 days after FRA provides
notice of the Secretary's certification that the FRA Administrator has
sufficient resources that are adequate to undertake the pilot program.
This deadline is necessary in order to comply with the statutory
mandate. Specifically, 49 U.S.C. 24711(a)(4) requires FRA to, as
relevant here, ``give preference in awarding contracts to bidders
seeking to operate routes that have been identified as one of the five
worst performing Amtrak routes under section 24710'' of title 49 of the
United States Code. In order to comply with this statutory directive to
``give preference'' to ``the five worst performing Amtrak routes,'' FRA
must be able to evaluate all bids at the same time. Section 269.7(b)'s
petition deadline enables FRA to evaluate all bids at the same time and
to ``give preference'' where appropriate as directed by the statute.
    In addition, Sec. Sec.  269.3(c) and 269.7(d) of the final rule
also take into consideration the possibility that the period during
which a railroad may provide passenger rail service under this pilot
program, which is currently set by statute to expire on October 16,
2013, is extended by statute. In that event, the final rule requires
petitions to be filed with FRA no later than 60 days after the
enactment of such statutory authority and requires such petitions to
otherwise comply with the requirements of this part.
    A comment stated that the ``worst performing routes'' criteria must
be modified to assure that other routes, including State-supported
routes, be eligible for the pilot program. Another comment sought
clarification regarding whether petitions for routes which were not one
of the worst performing routes would be permitted to compete against
one of the worst performing routes. Section 214 of PRIIA mandates which
routes are eligible for the pilot program, as follows: Those routes
described in 49 U.S.C. 24102(5)(B), (C), or (D) and 49 U.S.C. 24702.
See 49 U.S.C. 24711(a)(1). As such, Amtrak State-supported routes under
49 U.S.C. 24702 are eligible for the pilot program. In addition, the
worst performing routes preference is required by statute, and simply
provides that FRA shall give preference in awarding contracts to
bidders who are seeking to operate such routes. See 49 U.S.C.
24711(a)(4). FRA is not required to select such routes; instead, the
worst performing routes preference is one factor in FRA's evaluation of
the bids submitted.
    As to the filing of bids, Sec.  269.9 requires the Petitioner and
Amtrak to both file bids with FRA no later than 60 days after the
petition deadline established by Sec.  269.7(b). Section 269.9(b)
articulates the bid requirements. The 60-day time period gives a bidder
sufficient time to prepare a bid that satisfies the bid requirements,
while also limiting the duration of the bid process.
    One comment stated that a petitioner's failure to submit a bid
within the timeline established by this final rule should result in an
automatic disqualification of that party from bidding on the route at
issue. The comment stated that late bids would defeat what is already a
short-duration program, and would allow a party to game the process.
The final rule is clear that under Sec.  269.9 both the petitioner and
Amtrak must file bids with FRA no later than 60 days after the petition
deadline established by Sec.  269.7(b). No allowance is made for
exceptions to this deadline. Furthermore, Sec.  269.13 requires FRA to
execute a contract with the winning bidder(s) no later than 90 days
after the bid deadline established by Sec.  269.9.
    Lastly, as to the award and execution of contracts with winning
bidders, Sec.  269.13 requires FRA to execute a contract with the
winning bidder(s) no later than 90 days after the bid deadline
established by Sec.  269.9. Section 214 of PRIIA requires FRA to
``execute a contract within a specified, limited time.'' 49 U.S.C.
24711(a)(5). The 90-day time period is a limited period for FRA and the
winning bidder(s) to execute an agreement(s) that satisfies the
requirements of Sec.  269.13, including FRA's obligation of an
operating subsidy in compliance with the statutory requirements.

II. Section-by-Section Analysis

Section 269.1 Purpose

    This section provides that the final rule carries out the statutory
mandate set forth in 49 U.S.C. 24711 that requires FRA to develop a
pilot program that permits a rail carrier or rail carriers that own
infrastructure over which Amtrak operates a passenger rail service
route to petition FRA to be considered as a passenger rail service
provider over that route in lieu of Amtrak.
    A comment sought clarification regarding the meaning of the term
``own'' as it is used in this section (and as it is used in Sec.
269.7(a) of this final rule). The comment further stated that the party
responsible for maintenance of such infrastructure under 49 CFR part
213 should be considered an owner for purposes of this section.
However, Sec.  214 of PRIIA is clear in that only a rail carrier or
rail carriers that own such infrastructure may submit a petition under
the pilot program. See 49 U.S.C. 24711(a)(1). The statute does not
authorize FRA to expand this statutory directive by allowing a party
responsible for maintenance of such infrastructure to submit a
petition. Furthermore, and as noted above, this final rule does not
prohibit an eligible rail carrier from entering into an agreement with
a third party (such as an entity that maintains the infrastructure) to
manage and/or operate the passenger rail service.

Section 269.3 Application

    Paragraph (a) of this section provides that the final rule does not
apply to any railroad, unless and until, the Secretary certifies that
FRA has sufficient resources that are adequate to undertake the pilot
program. This section also states that, upon receipt, FRA will provide
notice of the certification on the FRA public Web site. This paragraph
is based on the statutory directive in 49 U.S.C. 24711(e). In addition,
as discussed in Sec.  269.7(a), FRA's notice of the Secretary's
certification will trigger the 45-day deadline by which an eligible
railroad may petition FRA under the pilot program.
    Paragraph (b) of this section provides that the pilot program will
not be made available to more than two Amtrak intercity passenger rail
routes. This paragraph is based on the statutory directive contained in
49 U.S.C. 24711(b).
    Paragraph (c) of this section provides that any rail carrier or
rail carriers awarded a contract to provide passenger

rail service under the pilot program may only be able to provide such
service for a period not to exceed five years after October 16, 2008
(the date of PRIIA's enactment), or a later date authorized by statute.
This paragraph is based on the statutory directive contained in 49
U.S.C. 24711(a)(1). In addition, this paragraph also takes into
consideration the possibility that the 5-year limitation period
established in PRIIA is extended by statute.
    Several comments stated that the pilot program should be extended
to allow for a longer program period (e.g., extending the program to
five years from the time an award is made), which the comments stated
would allow pilot program operators to function more efficiently, and
would be a more appropriate period of time considering the work
necessary to operate a route. However, as discussed, Sec.  214 of PRIIA
requires that the pilot program not exceed five years after the date of
PRIIA's enactment (October 16, 2008). In addition, the final rule does
take into consideration the possibility that the period established in
PRIIA may be extended by statute.

Section 269.5 Definitions

    This section contains the definitions for the final rule. This
section defines the following terms: Act; Administrator; Amtrak; File
and filed; Financial plan; FRA; Operating plan; Passenger rail service
route; Petitioner; Railroad, and Secretary. Among other definitions,
this section defines ``passenger rail service route'' to mean those
routes described in 49 U.S.C. 24102(5)(B), (C), and (D) and in 49
U.S.C. 24702. This definition is based on the statutory directive
contained in 49 U.S.C. 24711(a)(1). In addition, this section defines
``railroad'' to mean a rail carrier or rail carriers, as defined in 49
U.S.C. 10102(5). This definition is based on the statutory directive
contained in 49 U.S.C. 24711(a)(1) and (c)(3).
    This section also defines ``financial plan'' to mean a plan that
contains, for each Federal fiscal year fully or partially covered by
the bid: An annual projection of the revenues, expenses, capital
expenditure requirements, and cash flows (from operating activities,
investing activities, and financing activities, showing sources and
uses of funds) attributable to the route; and a statement of the
assumptions underlying the financial plan's contents. In addition, this
section defines ``operating plan'' to mean a plan that contains, for
each Federal fiscal year fully or partially covered by the bid: A
complete description of the service planned to be offered, including
the train schedules, frequencies, equipment consists, fare structures,
and such amenities as sleeping cars and food service provisions;
station locations; hours of operation; provisions for accommodating the
traveling public, including proposed arrangements for stations shared
with other routes; expected ridership; passenger-miles; revenues by
class of service between each city-pair proposed to be served; and a
statement of the assumptions underlying the operating plan's contents.
The final rule requires bidders to include a financial plan and an
operating plan--as those terms are defined here--in their bids. These
definitions will ensure that bids contain sufficient information to be
evaluated.

Section 269.7 Petitions

    Paragraph (a) of this section provides that a railroad that owns
infrastructure over which Amtrak operates a passenger rail service
route may petition FRA to be considered as a passenger rail service
provider over that route in lieu of Amtrak for a period of time
consistent with the time limitations described in section 269.3(c).
This paragraph is based on the statutory directive contained in 49
U.S.C. 24711(a)(1). This paragraph does not require that a railroad own
all of the infrastructure over which Amtrak operates a passenger rail
service route in order to file a petition.
    Comments sought clarification regarding the routes that are
eligible under the pilot program (one comment sought confirmation that
all current non-Northeast Corridor Amtrak-operated routes are eligible
for the pilot program, whether part of Amtrak's national system or
State-supported, and regardless of the length of the route). A related
comment sought clarification regarding the eligibility of routes which
connected with or utilized Northeast Corridor or other Amtrak-owned
infrastructure. As discussed above, PRIIA and this final rule provide
that all of the routes described in 49 U.S.C. 24102(5)(B), (C), and (D)
and in 49 U.S.C. 24702 are eligible. See 49 U.S.C. 24711(a)(1).
Amtrak's Northeast Corridor is not eligible for the pilot program. See
49 U.S.C. 24711(a)(1) (statute does not include 49 U.S.C. 24102(5)(A)
in the description of eligible Amtrak routes). As noted, FRA will
examine any agreement(s) necessary for the operation of the proposed
passenger service over right-of-way on the route that is not owned by
the petitioning railroad, as described in Sec.  269.9(b)(2) of this
final rule. This analysis would include any Amtrak-owned infrastructure
on the route at issue (whether voluntary or pursuant to a Surface
Transportation Board order under Sec.  217 of PRIIA).
    Another comment asked whether the proposed rule ``exercise[s] any
jurisdiction'' over the process in which a State enters into a contract
with a party other than Amtrak to operate a State-supported intercity
passenger route (or whether such a situation more appropriately falls
under Sec.  217 of PRIIA). Section 214 of PRIIA does not address this
issue, nor does this final rule.
    In seeking clarification regarding the meaning of the term
``passenger rail service route'' as used in Paragraph (a) of this
section, a comment questioned whether the Chicago-Milwaukee route 21
Hiawatha is included as part of the route 25 Empire Builder because it
uses the same trackage, and whether route 25, which has two
destinations, Seattle and Portland, is one route or two. Determination
of these site-specific details can only be made in response to specific
petitions. For this final rule to address every such situation--of
which the national rail network could present more than one--would add
needless complexity and would delay the rulemaking process.
    A comment questioned FRA's authority to permit a rail carrier that
does not own all of the infrastructure on a particular eligible route
to access that portion of the infrastructure owned by another party.
This comment misconstrues the proposed rule. Under the NPRM and this
final rule, a railroad that owns infrastructure over which Amtrak
operates certain passenger rail service routes may petition FRA. As
noted, a railroad does not have to own all of the infrastructure over
which Amtrak operates in order to file a petition. However, in that
event, FRA would expect the railroad to describe in its bid the
agreement(s) necessary to operate over right-of-way that is not owned
by the bidding railroad, in compliance with Sec.  269.9(b) of this
final rule.
    A comment also stated that a railroad should be able to offer
service over a shorter route (as compared to the Amtrak route) if the
omitted section of the route would continue to be provided with service
by another passenger train. However, Sec.  214 of PRIIA and this final
rule require that a railroad selected to provide rail passenger service
over a route under the pilot program must continue to provide passenger
rail service on the route that is no less frequent, nor over a shorter
distance, than Amtrak provided on that route before the award. See 49
U.S.C. 24711(c)(1)(A).

    Paragraph (b) of this section provides that a petition submitted to
FRA under this rule must: Be filed with FRA no later than 45 days after
FRA provides notice of the Secretary's certification pursuant to
proposed Sec.  269.3(a); describe the petition as a ``Petition to
Provide Passenger Rail Service under 49 CFR part 269''; and describe
the route or routes over which the petitioner wants to provide
passenger rail service and the Amtrak service that the petitioner wants
to replace. This paragraph is intended to ensure that a petition
provides clear notice to FRA.
    Paragraph (c) of this section provides that, in the event that a
later statute extends the time period under which a railroad may
provide passenger rail service pursuant to the pilot program, petitions
would have to be filed with FRA no later than 60 days after the later
of the enactment of such statutory authority or the Secretary's
issuance of the certification under Sec.  269.3(a), and that the
petition must otherwise comply with the requirements of the pilot
program. This paragraph takes into consideration the possibility that
the 5-year limitations period established in PRIIA is extended by
statute.

Section 269.9 Bid Process

    Paragraph (a) of this section provides that FRA will notify Amtrak
of any eligible petition filed with FRA no later than 30 days after
FRA's receipt of such petition. This paragraph is based on the
statutory directive contained in 49 U.S.C. 24711(a)(2).
    A comment stated that Amtrak should be required to provide any
bidder under the pilot program with route performance information for
the previous five years (including ridership, passenger-miles, and
revenues by class of service between each city-pair). However, such a
requirement is beyond the authority created by Sec.  214 of PRIIA.
    A comment also stated that FRA and Amtrak should work with bidders
under the pilot program to develop a proposal that is mutually
beneficial to all parties (e.g., a proposal in which Amtrak continues
to provide some of its services for the route at issue). The statutory
mandate sets forth a competitive process in which a railroad and Amtrak
bid for a route. The statute does not authorize a requirement that
Amtrak work on a collaborative bid with a railroad that is seeking to
replace Amtrak.
    A comment sought clarification regarding whether Amtrak is
restricted to bidding its current fully-allocated financial performance
under the route profitability system, or whether Amtrak could be
allowed to propose anything materially different from its current
performance. That comment went on to state that Amtrak should not be
able to make a bid materially different from its current fully-
allocated financial and performance metrics and that Amtrak should not
be able to make a bid based on incremental costs because its overhead
is devoted to servicing these passenger routes. However, Sec.  214 of
PRIIA and this final rule are intended to foster improved and more
competitive passenger rail service. The comment's proposed restrictions
would stifle innovation and work against that very purpose. Moreover,
all bidders have an inherent interest in minimizing the cash losses of
the service in question: Amtrak, because it operates under a limited
Federal operating grant; and the competing bidder(s), which would need
to minimize both the subsidy requirement and the cash drain on their
corporate finances (so as to both win the bid and safeguard their
profitability). FRA believes that these inherent factors will prohibit
bids that do not cover their full costs, and in any event, FRA will be
carefully evaluating all bids for their viability.
    Paragraph (b) of this section describes the bid requirements,
including a requirement that such bids must be filed with FRA no later
than 60 days after the petition deadline established by Sec.  269.7.
Paragraph (b) further provides that such bids must: (1) Provide FRA
with sufficient information to evaluate the level of service described
in the proposal, and to evaluate the proposal's compliance with the
requirements described in Sec.  269.13(b); (2) describe how the bidder
would operate the route (including an operating plan, a financial plan
and, if applicable, any agreement(s) necessary for the operation of
passenger service over right-of-way on the route that is not owned by
the railroad), and, if the bidder intends to generate any revenues from
ancillary activities (i.e., activities other than passenger
transportation, accommodations, and food service) as part of its
proposed operation of the route, then the bidder must fully describe
such ancillary activities and identify their incremental impact in all
relevant sections of the operating plan and the financial plan, and on
the route's performance under the financial and performance metrics
developed pursuant to Sec.  207 of the Act, together with the
assumptions underlying the estimates of such incremental impacts; (3)
describe what Amtrak passenger equipment would be needed, if any; (4)
describe in detail, including amounts, timing, and intended purpose,
what sources of Federal and non-Federal funding the bidder would use,
including but not limited to any Federal or State operating subsidy and
any other Federal or State payments; (5) contain a staffing plan
describing the number of employees needed to operate the service, the
job assignments and requirements, and the terms of work for prospective
and current employees of the bidder for the service outlined in the
bid; and (6) describe how the passenger rail service would comply with
the financial and performance metrics developed pursuant to Sec.  207
of PRIIA (at a minimum, this description must include, for each Federal
fiscal year fully or partially covered by the bid: A projection of the
route's expected on-time performance and train delays according to the
metrics developed pursuant to Sec.  207 of PRIIA; and the net cash used
in operating activities per passenger-mile attributable to the route,
both before and after the application of any expected public
subsidies). This paragraph is based on the statutory directive
contained in 49 U.S.C. 24711(a)(3) and (a)(6).
    FRA is making one technical change to the rule text in Paragraph
(b)(6) in order to permit FRA to better compare and evaluate bids.
Paragraph (b)(6) provides that a bid must describe how the passenger
rail service would comply with the financial and performance metrics
developed pursuant to Sec.  207 of PRIIA, and then proceeds to list
what that description must include. The last item in that list is the
net cash used in operating activities per passenger-mile. FRA is making
one technical change here by further stating that the net cash must be
both before and after the application of any expected public subsidies.
This clarification is consistent with the statutory mandate and the
metrics developed pursuant to Sec.  207 of PRIIA, and allows for FRA to
be able to compare the net cash numbers provided by Amtrak and a rail
carrier. See 49 U.S.C. 24711(a)(4).
    Paragraph (c) of this section provides that FRA may request
supplemental information from a petitioner and/or Amtrak where FRA
determines such information is needed to evaluate a bid. In such a
request, FRA will establish a deadline by which the supplemental
information must be submitted to FRA. This paragraph allows FRA to
request additional information where the information provided in a bid
prevents FRA from adequately evaluating the proposal.

Section 269.11 Evaluation

    This section provides that FRA will select a winning bidder by
evaluating the bids against the financial and

performance metrics developed under section 207 of PRIIA and the
requirements of this part, and will give preference in awarding
contracts to bidders seeking to operate routes that have been
identified as one of the five worst performing Amtrak routes under 49
U.S.C. 24710. This paragraph is based on the statutory directive
contained in 49 U.S.C. 24711(a)(4).

Section 269.13 Award

    Paragraph (a) of this section provides that FRA will execute a
contract with the winning bidder(s) consistent with the requirements of
Sec.  269.13 and as FRA may otherwise require, no later than 90 days
after the bid deadline established by Sec.  269.9(b). This paragraph
also provides that FRA will provide timely notice of these selections
to all petitioners and to Amtrak. This paragraph is based on the
statutory directive contained in 49 U.S.C. 24711(a)(5).
    Paragraph (b) of this section provides that, among other things,
such a contract will: (1) Award to the winning bidder the right and
obligation to provide passenger rail service over that route subject to
such performance standards as FRA may require, consistent with the
standards developed under section 207 of PRIIA; (2) award to the
winning bidder an operating subsidy for the first year at a level not
in excess of the level in effect during the fiscal year preceding the
fiscal year in which the petition was received, adjusted for inflation,
and for any subsequent years at such level, adjusted for inflation; (3)
condition the operating and subsidy rights upon the winning bidder
continuing to provide passenger rail service on the route that is no
less frequent, nor over a shorter distance, than Amtrak provided on
that route before the award; (4) condition the operating and subsidy
rights upon the winning bidder's compliance with the minimum standards
established under section 207 of PRIIA and such additional performance
standards as FRA may establish; and (5) subject the winning bidder to
the grant conditions established by 49 U.S.C. 24405. This paragraph is
based on the statutory directive contained in 49 U.S.C. 24711(a)(5),
(c)(1), and (c)(4).
    A comment stated that FRA should mandate contractual provisions for
liability and insurance that are consistent for all parties. However,
the statutory mandate does not authorize such a requirement. It should
be noted that Sec.  214 and this final rule do require that a winning
bidder under the pilot program shall be subject to the grant conditions
under 49 U.S.C. 24405. See 49 U.S.C. 24711(c)(4). One requirement under
49 U.S.C. 24405(c)(1)(D) is compliance with the liability requirements
consistent with 49 U.S.C. 28103, which among other things limits rail
passenger transportation liability.
    Paragraph (c) of this section provides that the winning bidder will
make their staffing plan, submitted as required by Sec.  269.9(b)(4),
available to the public after the bid award. This paragraph is based on
the statutory directive contained in 49 U.S.C. 24711(a)(6).

Section 269.15 Access to Facilities; Employees

    Paragraph (a) of this section provides that, if an award under
Sec.  269.13 is made to a rail carrier other than Amtrak, Amtrak must
provide access to its reservation system, stations, and facilities
directly related to operations to the winning bidder awarded a
contract, in accordance with Sec.  217 of PRIIA, necessary to carry out
the purposes of the final rule. This paragraph is based on the
statutory directive contained in 49 U.S.C. 24711(c)(2).
    A comment stated that the rolling stock, stations, and reservation
systems that Amtrak uses need to be available to pilot program
operators at no cost. As discussed, Sec.  214 of PRIIA requires that
Amtrak provide access to its reservation system, stations, and
facilities. See 49 U.S.C. 24711(c)(2). However, Sec.  214 does not
authorize FRA to require Amtrak to provide such access at no cost.
    A comment sought clarification regarding how FRA would establish an
equitable cost basis for third party access to Amtrak's reservation
system, stations, and facilities in a timely manner. As required by
statute and this final rule, Amtrak is required to provide such access
in accordance with Sec.  217 of PRIIA, which provides a process by
which a cost is agreed upon by the parties. See 49 U.S.C. 24711(c)(2).
    A comment also sought clarification as to whether such access
includes access to services provided by Amtrak employees, including
reservation agents, redcaps, gate agents, Qualified Maintenance Persons
or Qualified Persons. The statute and this final rule only provide that
Amtrak shall be required to provide access to its reservation system,
stations, and facilities; the statute does not authorize access to
services performed by Amtrak employees.
    A comment stated that Amtrak should not be able to prevent
operation of a route by a private rail carrier by withholding services
directly related to Amtrak's control of its facilities, stations, or
reservation systems. FRA agrees that Amtrak must comply with the
requirements of the statute and this final rule. In providing access to
its reservation system, stations, and facilities, Amtrak would need to
allow the third-party to successfully use the reservation system,
stations and facilities.
    A comment sought clarification regarding whether the term
``facilities'' as used in paragraph (a) of this section encompasses
Amtrak's contracted right to use facilities it does not own and
provided the hypothetical example of whether a bidder for the Vermonter
route would have access to the portion of the Northeast Corridor
between New Haven and New York City owned by Metro North. That comment
went on to state that the definition should be broad and should
encompass all facilities to which Amtrak has access through ownership,
lease or contract. Section 214 of PRIIA does not authorize such a broad
definition. Putting aside circumstances in which Amtrak owns the
infrastructure and Sec.  217 of PRIIA may apply, neither the statute
nor this final rule require that owners of right-of-way not owned by a
bidding railroad must provide access to their infrastructure. As
described above, pursuant to the statutory mandate, the pilot program
developed by this final rule only permits a rail carrier or rail
carriers that own infrastructure to petition FRA. In the event that a
bidder does not own all of the infrastructure on the route, the bid
must describe the operating agreements necessary for operation on the
right-of-way not owned by the railroad.
    Paragraph (b) of this section provides that the employees of any
person used by a rail carrier in the operation of a route under the
final rule will be considered an employee of that carrier and subject
to the applicable Federal laws and regulations governing similar crafts
or classes of employees of Amtrak, including provisions under Sec.  121
of the Amtrak Reform and Accountability Act of 1997 relating to
employees that provide food and beverage service. This paragraph is
based on the statutory directive contained in 49 U.S.C. 24711(c)(3).
    Paragraph (c) of this section provides that a winning bidder will
provide hiring preference to qualified Amtrak employees displaced by
the award of the bid, consistent with the staffing plan submitted by
the winning bidder. This paragraph is based on the statutory directive
contained in 49 U.S.C. 24711(c)(4).

Section 269.17 Cessation of Service

    This section provides that, if a rail carrier awarded a route under
this rule ceases to operate the service or fails to

fulfill its obligations under the contract required under Sec.  269.13,
the Administrator, in collaboration with the Surface Transportation
Board, will take any necessary action consistent with title 49 of the
United States Code to enforce the contract and ensure the continued
provision of service, including the installment of an interim service
provider and re-bidding the contract to operate the service. This
section further provides that the entity providing service would either
be Amtrak or a rail carrier eligible for the pilot program under Sec.
269.7. This paragraph is based on the statutory directive contained in
49 U.S.C. 24711(d).

III. Regulatory Impact and Notices

1. Executive Orders 12866 and 13563 and DOT Regulatory Policies and
Procedures

    This final rule has been evaluated in accordance with existing
policies and procedures and determined to be non-significant under
Executive Orders 12866 and 13563, and U.S. Department of Transportation
(DOT) policies and procedures. See 44 FR 11034; February 26, 1979. FRA
has prepared and placed in the docket a regulatory impact analysis
(RIA) addressing the economic impact of this final rule. Document
inspection and copying facilities are available at the DOT Central
Docket Management Facility located in Room W12-140 on the ground level
of the West Building, 1200 New Jersey Avenue SE., Washington, DC 20590.
Docket material is also available for inspection electronically through
the Federal eRulemaking Portal at http://www.regulations.gov.
Photocopies may also be obtained by submitting a written request to the
FRA Docket Clerk at the Office of Chief Counsel, RCC-10, Mail Stop 10,
Federal Railroad Administration, 1200 New Jersey Avenue SE.,
Washington, DC 20590; please refer to Docket No. FRA-2009-0108.
    As part of a RIA, FRA generally assesses quantitative measurements
of the cost and benefit streams expected to result from the adoption of
a rule. However, in this case, due to the limited number of routes that
can be awarded under the pilot program (only two routes can be
awarded), and the short timeframe in which this pilot program will
operate (until 2013), it is not feasible to perform an analysis for an
extended period. There are no alternate service provider railroad
regulatory costs because the program is voluntary with respect to such
rail carriers. Regulatory costs will be triggered for Amtrak if one or
more alternative service providers bid on a route(s). For informational
purposes, FRA included in the RIA appendices detailing the estimated
average costs for both a railroad and Amtrak to participate in the
pilot program. FRA estimates the average cost for each individual
railroad to participate in the program and to submit the required bid
proposal (the majority of the cost) at about $300,000 per route, and
the average cost for Amtrak at about $150,000 per route (regardless of
how many individual railroads bid on the individual Amtrak route). Non-
Amtrak railroads that participate voluntarily will do so because they
consider the benefits to exceed the costs. Thus, any participation will
be net-beneficial with respect to the voluntary participant. Any costs
to Amtrak are regulatory costs incurred solely due to the requirements
of this final rule, and will primarily be associated with costs
associated with developing bids.
    Given that this pilot program is voluntary for alternate service
providers and is not currently funded by Congress, FRA estimates that
this regulation will not result in any benefits or costs.

2. Regulatory Flexibility Act

    To ensure potential impacts of rules on small entities are properly
considered, FRA developed this final rule in accordance with Executive
Order 13272 (``Proper Consideration of Small Entities in Agency
Rulemaking'') and DOT's procedures and policies to promote compliance
with the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). The
Regulatory Flexibility Act requires an agency to review regulations to
assess their impact on small entities. An agency must conduct a
regulatory flexibility analysis unless it determines and certifies that
a rule is not expected to have a significant impact on a substantial
number of small entities.
Purpose
    As noted earlier in this final rule, the purpose of this rulemaking
is to respond to a statutory mandate to develop a pilot program that
permits a rail carrier or rail carriers that own infrastructure over
which Amtrak operates certain passenger rail service routes to petition
FRA to be considered as a passenger rail service provider over such a
route in lieu of Amtrak for a period not to exceed 5 years after the
date of enactment of the Passenger Rail Investment and Improvement Act
of 2008 (PRIIA). The final rule develops this pilot program in
conformance with the statutory directive.
    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601 et seq.)
requires a review of proposed and final rules to assess their impact on
small entities, unless the Secretary of Transportation certifies that
the rule will not have a significant economic impact on a substantial
number of small entities. Pursuant to Section 312 of the Small Business
Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), FRA has
issued a final policy that formally establishes ``small entities'' as
including railroads that meet the line-haulage revenue requirements of
a Class III railroad. Title 49 Code of Federal Regulations CFR Part
209, Appendix C. For other entities, the same dollar limit in revenues
governs whether a railroad, contractor, or other respondent is a small
entity. Id. Additionally, Section 601(5) defines as ``small entities''
governments of cities, counties, towns, townships, villages, school
districts, or special districts with populations less than 50,000. Such
governments will not be directly impacted by this final rule.
Rationale for Choosing Regulatory Action and Legal Authority
    FRA is initiating this final rule in response to a statutory
mandate set forth in Section 214 of the PRIIA. Section 214 requires FRA
to complete a rulemaking proceeding to develop a pilot program that
permits a rail carrier or rail carriers that own infrastructure over
which Amtrak operates certain passenger rail service routes to petition
FRA to be considered as a passenger rail service provider over such a
route in lieu of Amtrak for a period not to exceed 5 years after the
date of enactment of the PRIIA. This final rule develops this pilot
program in conformance with the statutory directive.
Description of Regulated Entities and Impacts
    This final rule is applicable to railroads that own infrastructure
upon which Amtrak operates those routes described in 49 U.S.C.
24102(5)(B), (C), and (D) and in 49 U.S.C. 24702, which may include
small railroads. ``Small entity'' is defined in 5 U.S.C. 601 as
including a small business concern that is independently owned and
operated, and is not dominant in its field of operation. The U.S. Small
Business Administration (SBA) has authority to regulate issues related
to small businesses, and stipulates in its size standards that a
``small entity'' in the railroad industry is a for profit ``line-haul
railroad'' that has fewer than 1,500 employees, a ``short line
railroad'' with fewer than 500 employees, or a ``commuter rail system''
with annual

receipts of less than $7 million. See ``Size Eligibility Provisions and
Standards,'' 13 CFR Part 121, Subpart A. Federal agencies may adopt
their own size standards for small entities in consultation with SBA
and in conjunction with public comment. Pursuant to that authority, FRA
has published a final statement of agency policy that formally
establishes ``small entities'' or ``small businesses'' as being
railroads, contractors, and hazardous materials shippers that meet the
revenue requirements of a Class III railroad as set forth in 49 CFR
1201.1-1, which is $20 million or less in inflation-adjusted annual
revenues, and commuter railroads or small governmental jurisdictions
that serve populations of 50,000 or less. See 68 FR 24891 (May 9, 2003)
(codified at Appendix C to 49 CFR Part 209). The $20 million limit is
based on the Surface Transportation Board's revenue threshold for a
Class III railroad carrier. Railroad revenue is adjusted for inflation
by applying a revenue deflator formula in accordance with 49 CFR
1201.1-1. FRA is using this definition for the final rule.
Minimum Requirements for Pilot Program Applications
    Small railroads face the same requirements for entry in the pilot
program as other railroads. The railroad must own infrastructure upon
which Amtrak operates those routes described in 49 U.S.C. 24102(5)(B),
(C), and (D), and in 49 U.S.C. 24702.
Disclosure of Assumptions
    The purpose of this economic analysis is to provide pertinent
information on the effects of the regulation, 49 CFR Part 269,
Alternate Passenger Rail Service Pilot Program. FRA believes that the
regulation will not have any effect on small railroads since
participation in the pilot program is voluntary, only two routes are
available for award, the program expires in 2013, and it is unlikely
that Federal funding not currently available will be available for the
program. FRA does not anticipate that any small railroads will be
interested in taking over such an existing, eligible Amtrak route.
Criteria for Substantial Number
    This regulation is voluntary for all rail carriers, except Amtrak,
which will be impacted only if another carrier petitions to participate
in the pilot program. Therefore, there are no mandates placed on large
or small railroads. Consequently, this regulation will not affect a
substantial number of small entities, and most likely will not impact
any small entities.
Criteria for Significant Economic Impacts
    The factual basis for the certification that this final rule will
not have a significant economic impact on a substantial number of small
entities is that the pilot program is voluntary for all rail carriers
except Amtrak; and no small entities are anticipated to apply.
Therefore, this regulation is not expected to have a significant
economic impact on a substantial number of small entities.
    FRA notes that this regulation does not disproportionately place
any small railroads that are small entities at a significant
competitive disadvantage. Small railroads are not excluded from
participation, so long as they are eligible. This regulation and the
underlying statute are aimed at railroads taking over an entire route.
If Amtrak uses 30 miles of a small railroad's infrastructure in a route
that is 750 miles long, the small railroad could not apply to take over
just its own segment, but will have to apply to take over the whole
route. Thus, the ability to bid on a route is not constrained by a
railroad's size.
Request for Comments
    FRA invited comments from all interested parties on this
certification. FRA also requested comments on the regulatory impact
analysis and its underlying assumptions. FRA particularly encouraged
small entities that could potentially be impacted by the proposed
regulation to participate in the public comment process by submitting
comments on this assessment or this rulemaking to the official DOT
docket. Although FRA received comments on the proposed rule, none were
related to either economic analysis.
Certification
    Pursuant to the Regulatory Flexibility Act (5 U.S.C. 605(b)), FRA
certifies that this final rule will not have a significant economic
impact on a substantial number of small entities. The final rule does
not require, or otherwise impose, any requirements upon any small
entities. Instead, this final rule develops a pilot program under which
an eligible small entity may voluntarily elect to participate.
Furthermore, the final rule establishes a very limited pilot program
that applies to no more than two Amtrak routes.

3. Paperwork Reduction Act

    According to the Paperwork Reduction Act of 1995 and OMB's
Implementing Guidance at 5 CFR 1320.3(c), ``collection of information
means, except as provided in section 1320.4, the obtaining, causing to
be obtained, soliciting, or requiring the disclosure to an agency,
third parties or the public of information by or for an agency by means
of identical questions posed to, or identical reporting, recordkeeping,
or disclosure requirements imposed on, ten or more persons, whether
such collection of information is mandatory, voluntary, or required to
obtain or retain a benefit.'' FRA expects that the requirements of this
final rule will affect less than 10 railroads or ``persons'' as defined
in 5 CFR 1320.(c)(4). Consequently, no information collection
submission is necessary, and no approval is being sought from the
Office of Management and Budget (OMB) at this time.

4. Environmental Impact

    FRA has evaluated this final rule in accordance with its
``Procedures for Considering Environmental Impacts'' (FRA's Procedures)
(64 FR 28545, May 26, 1999) as required by the National Environmental
Policy Act (42 U.S.C. 4321 et seq.), other environmental statutes,
Executive Orders, and related regulatory requirements. FRA has
determined that this document is not a major FRA action (requiring the
preparation of an environmental impact statement or environmental
assessment) because the rulemaking would not result in a change in
current passenger service; instead, the program would only potentially
result in a change in the operator of such service. In accordance with
section 4(c) and (e) of FRA's Procedures, the agency has further
concluded that no extraordinary circumstances exist with respect to
this final rule that might trigger the need for a more detailed
environmental review. As a result, FRA finds that this final rule is
not a major Federal action significantly affecting the quality of the
human environment.

5. Federalism Implications

    Executive Order 13132, ``Federalism'' (64 FR 43255, Aug. 4, 1999),
requires FRA to develop an accountable process to ensure ``meaningful
and timely input by State and local officials in the development of
regulatory policies that have federalism implications.'' ``Policies
that have federalism implications'' are defined in the Executive Order
to include regulations that 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.'' Under Executive Order 13132, the agency
may not issue

a regulation with federalism implications that imposes substantial
direct compliance costs and that is not required by statute, unless the
Federal government provides the funds necessary to pay the direct
compliance costs incurred by State and local governments, or the agency
consults with State and local government officials early in the process
of developing the regulation. Where a regulation has federalism
implications and preempts State law, the agency seeks to consult with
State and local officials in the process of developing the regulation.
    FRA has analyzed this final rule in accordance with the principles
and criteria contained in Executive Order 13132. This final rule will
not have a substantial direct effect on the States, on the relationship
between the Federal government and the States, or on the distribution
of power and responsibilities among the various levels of government.
In addition, this final rule will not impose substantial direct
compliance costs on State and local governments. Therefore, the
consultation and funding requirements of Executive Order 13132 do not
apply. As explained, FRA has determined that this final rule has no
federalism implications. Accordingly, FRA has determined that
preparation of a federalism summary impact statement for this final
rule is not required.

6. Unfunded Mandates Reform Act of 1995

    Pursuant to Section 201 of the Unfunded Mandates Reform Act of 1995
(Pub. L. 104-4, 2 U.S.C. 1531), each Federal agency ``shall, unless
otherwise prohibited by law, assess the effects of Federal regulatory
actions on State, local, and tribal governments, and the private sector
(other than to the extent that such regulations incorporate
requirements specifically set forth in law).'' Section 202 of the Act
(2 U.S.C. 1532) further requires that ``before promulgating any general
notice of proposed rulemaking that is likely to result in the
promulgation of any rule that includes any Federal mandate that may
result in expenditure by State, local, and tribal governments, in the
aggregate, or by the private sector, of $100,000,000 or more (adjusted
annually for inflation) in any one year, and before promulgating any
final rule for which a general notice of proposed rulemaking was
published, the agency shall prepare a written statement'' detailing the
effect on State, local, and tribal governments and the private sector.
This monetary amount of $100,000,000 has been adjusted to $140,800,000
to account for inflation. This final rule will not result in the
expenditure of more than $140,800,000 by the public sector in any one
year, and thus preparation of such a statement is not required.

7. Energy Impact

    Executive Order 13211 requires Federal agencies to prepare a
Statement of Energy Effects for any ``significant energy action.'' 66
FR 28355 (May 22, 2001). Under the Executive Order, a ``significant
energy action'' is defined as any action by an agency (normally
published in the Federal Register) that promulgates or is expected to
lead to the promulgation of a final rule or regulation, including
notices of inquiry, advance notices of proposed rulemaking, and notices
of proposed rulemaking that: (1)(i) Is a significant regulatory action
under Executive Order 12866 or any successor order, and (ii) is likely
to have a significant adverse effect on the supply, distribution, or
use of energy; or (2) is designated by the Administrator of the Office
of Information and Regulatory Affairs as a significant energy action.
FRA has evaluated this final rule in accordance with Executive Order
13211. FRA has determined that this final rule is not likely to have a
significant adverse effect on the supply, distribution, or use of
energy. Consequently, FRA has determined that this final rule is not a
``significant energy action'' within the meaning of Executive Order
13211.

8. Privacy Act Information

    Interested parties should be aware that anyone is able to search
the electronic form of all written communications and comments received
into any agency docket by the name of the individual submitting the
document (or signing the document, if submitted on behalf of an
association, business, labor union, etc.). You may review DOT's
complete Privacy Act Statement in the Federal Register published on
April 11, 2000 (65 FR 19477), or you may visit http://www.dot.gov/privacy.html.

List of Subjects in 49 CFR Part 269

    Railroads; Railroad employees.

The Rule

    For the reasons discussed in the preamble, FRA amends chapter II,
subtitle B of title 49, Code of Federal Regulations, by adding part 269
to read as follows:

PART 269--ALTERNATE PASSENGER RAIL SERVICE PILOT PROGRAM

Sec.
269.1 Purpose.
269.3 Application.
269.5 Definitions.
269.7 Petitions.
269.9 Bid process.
269.11 Evaluation.
269.13 Award.
269.15 Access to facilities; employees.
269.17 Cessation of service.

    Authority: Sec. 214, Div. B, Pub. L. 110-432; 49 U.S.C. 24711;
and 49 CFR 1.49.

Sec.  269.1  Purpose.

    The purpose of this part is to carry out the statutory mandate set
forth in 49 U.S.C. 24711 requiring FRA to develop a pilot program that
permits a railroad that owns infrastructure over which Amtrak operates
a passenger rail service route to petition FRA to be considered as a
passenger rail service provider over that route in lieu of Amtrak.

Sec.  269.3  Application.

    (a) Certification. This part will not be applicable to any
railroad, unless and until, the Secretary certifies that FRA has
sufficient resources that are adequate to undertake the pilot program
developed by this part. FRA will provide notice of the certification on
the FRA public Web site upon receipt.
    (b) Route limitations. The pilot program developed by this part
will not be made available to more than two Amtrak intercity passenger
rail routes.
    (c) Time limitations. Any railroad awarded a contract to provide
passenger rail service under the pilot program developed by this part
shall only provide such service for a period not to exceed either five
years after October 16, 2008, or a later date authorized by statute.

Sec.  269.5  Definitions.

    As used in this part--
    Act means the Passenger Rail Investment and Improvement Act of 2008
(Pub. L. 110-432, Division B (Oct. 16, 2008)).
    Administrator means the Federal Railroad Administrator, or the
Federal Railroad Administrator's delegate.
    Amtrak means the National Railroad Passenger Corporation.
    File and Filed mean submission of a document under this part on the
date the document was postmarked, or the date the document was emailed
to FRA.
    Financial plan means a plan that contains, for each Federal fiscal
year fully or partially covered by the bid: An annual projection of the
revenues, expenses, capital expenditure requirements, and cash flows
(from operating activities, investing activities, and financing
activities, showing sources and uses of funds) attributable

to the route; and a statement of the assumptions underlying the
financial plan's contents.
    FRA means the Federal Railroad Administration.
    Operating plan means a plan that contains, for each Federal fiscal
year fully or partially covered by the bid: A complete description of
the service planned to be offered, including the train schedules,
frequencies, equipment consists, fare structures, and such amenities as
sleeping cars and food service provisions; station locations; hours of
operation; provisions for accommodating the traveling public, including
proposed arrangements for stations shared with other routes; expected
ridership; passenger-miles; revenues by class of service between each
city-pair proposed to be served; and a statement of the assumptions
underlying the operating plan's contents.
    Passenger rail service route means those routes described in 49
U.S.C. 24102(5)(B), (C), and (D) or in 49 U.S.C. 24702.
    Petitioner means a railroad, other than Amtrak, that has submitted
a petition to FRA under section 269.7 of this part.
    Railroad means a rail carrier or rail carriers, as defined in 49
U.S.C. 10102(5).
    Secretary means the Secretary of the U.S. Department of
Transportation.

Sec.  269.7  Petitions.

    (a) In General. A railroad that owns infrastructure over which
Amtrak operates a passenger rail service route may petition FRA to be
considered as a passenger rail service provider over that route in lieu
of Amtrak for a period of time consistent with the time limitations
described in Sec.  269.3(c) of this part.
    (b) Petition Requirements. Each petition shall:
    (1) Be filed with FRA no later than 45 days after FRA provides
notice of the Secretary's certification pursuant to Sec.  269.3(a) of
this part using the following method: email to<EMAIL_ADDRESS>    (2) Describe the petition as a ``Petition to Provide Passenger Rail
Service under 49 CFR part 269''; and
    (3) Describe the route or routes over which the petitioner wants to
provide passenger rail service and the Amtrak service that the
petitioner wants to replace.
    (c) Future petitions. In the event that a statute extends the time
period under which a railroad may provide passenger rail service
pursuant to the pilot program developed by this part, petitions under
this section shall be filed with FRA no later than 60 days after the
later of the enactment of such statutory authority or the Secretary's
issuance of the certification under Sec.  269.3(a), and shall otherwise
comply with the requirements of this part.

Sec.  269.9  Bid process.

    (a) Amtrak notification. FRA will notify Amtrak of any eligible
petition filed with FRA no later than 30 days after FRA's receipt of
such petition.
    (b) Bid requirements. A petitioner and Amtrak must both file a bid
with FRA to provide passenger rail service over the route to which the
petition relates no later than 60 days after the petition deadline
established by Sec.  269.7 of this part using the following method:
email to<EMAIL_ADDRESS>Each such bid must:
    (1) Provide FRA with sufficient information to evaluate the level
of service described in the proposal, and to evaluate the proposal's
compliance with the requirements described in Sec.  269.13(b) of this
part;
    (2) Describe how the bidder would operate the route. This
description must include, but is not limited to, an operating plan, a
financial plan and, if applicable, any agreement(s) necessary for the
operation of passenger service over right-of-way on the route that is
not owned by the railroad. In addition, if the bidder intends to
generate any revenues from ancillary activities (i.e., activities other
than passenger transportation, accommodations, and food service) as
part of its proposed operation of the route, then the bidder must fully
describe such ancillary activities and identify their incremental
impact in all relevant sections of the operating plan and the financial
plan, and on the route's performance under the financial and
performance metrics developed pursuant to section 207 of the Act,
together with the assumptions underlying the estimates of such
incremental impacts;
    (3) Describe what Amtrak passenger equipment would be needed, if
any;
    (4) Describe in detail, including amounts, timing, and intended
purpose, what sources of Federal and non-Federal funding the bidder
would use, including but not limited to any Federal or State operating
subsidy and any other Federal or State payments;
    (5) Contain a staffing plan describing the number of employees
needed to operate the service, the job assignments and requirements,
and the terms of work for prospective and current employees of the
bidder for the service outlined in the bid; and
    (6) Describe how the passenger rail service would comply with the
financial and performance metrics developed pursuant to section 207 of
the Act. At a minimum, this description must include, for each Federal
fiscal year fully or partially covered by the bid: a projection of the
route's expected on-time performance and train delays according to the
metrics developed pursuant to section 207 of the Act; and the net cash
used in operating activities per passenger-mile (both before and after
the application of any expected public subsidies) attributable to the
route.
    (c) Supplemental information. FRA may request supplemental
information from a petitioner and/or Amtrak where FRA determines such
information is needed to evaluate a bid. In such a request, FRA will
establish a deadline by which the supplemental information must be
filed with FRA.

Sec.  269.11  Evaluation.

    FRA will select a winning bidder by evaluating the bids against the
financial and performance metrics developed under section 207 of the
Act and the requirements of this part, and will give preference in
awarding contracts to bidders seeking to operate routes that have been
identified as one of the five worst performing Amtrak routes under 49
U.S.C. 24710.

Sec.  269.13  Award.

    (a) Award. FRA will execute a contract with the winning bidder(s),
consistent with the requirements of this section and as FRA may
otherwise require, no later than 90 days after the bid deadline
established by Sec.  269.9(b) of this part. FRA will provide timely
notice of these selections to all petitioners and Amtrak.
    (b) Contract requirements. Among other things, the contract between
FRA and a winning bidder shall:
    (1) Award to the winning bidder the right and obligation to provide
passenger rail service over that route subject to such performance
standards as FRA may require, consistent with the standards developed
under section 207 of the Act, for a duration consistent with Sec.
269.3(c) of this part;
    (2) Award to the winning bidder an operating subsidy for the first
year at a level not in excess of the level in effect during the fiscal
year preceding the fiscal year in which the petition was received,
adjusted for inflation, and for any subsequent years at such level,
adjusted for inflation;
    (3) Condition the operating and subsidy rights upon the winning
bidder continuing to provide passenger rail service on the route that
is no less frequent, nor over a shorter distance,

than Amtrak provided on that route before the award;
    (4) Condition the operating and subsidy rights upon the winning
bidder's compliance with the minimum standards established under
section 207 of the Act and such additional performance standards as FRA
may establish; and
    (5) Subject the winning bidder to the grant conditions established
by 49 U.S.C. 24405.
    (c) Staffing Plan Publication. The winning bidder shall make their
staffing plan required by Sec.  269.9(b)(4) of this part available to
the public after the bid award.

Sec.  269.15  Access to facilities; employees.

    (a) Access to facilities. If the award under Sec.  269.13 of this
part is made to a railroad other than Amtrak, Amtrak must provide
access to its reservation system, stations, and facilities directly
related to operations to the winning bidder awarded a contract under
this part, in accordance with section 217 of the Act, necessary to
carry out the purposes of this part.
    (b) Employees. The employees of any person used by a railroad in
the operation of a route under this part shall be considered an
employee of that railroad and subject to the applicable Federal laws
and regulations governing similar crafts or classes of employees of
Amtrak, including provisions under section 121 of the Amtrak Reform and
Accountability Act of 1997 relating to employees who provide food and
beverage service.
    (c) Hiring preference. The winning bidder shall provide hiring
preference to qualified Amtrak employees displaced by the award of the
bid, consistent with the staffing plan submitted by the winning bidder.

Sec.  269.17  Cessation of service.

    If a railroad awarded a route under this part ceases to operate the
service or fails to fulfill its obligations under the contract required
under Sec.  269.13 of this part, the Administrator, in collaboration
with the Surface Transportation Board, shall take any necessary action
consistent with title 49 of the United States Code to enforce the
contract and ensure the continued provision of service, including the
installment of an interim service provider and re-bidding the contract
to operate the service. The entity providing service shall either be
Amtrak or a railroad eligible for this pilot program under Sec.  269.7
of this part.

    Issued in Washington, DC, on December 7, 2011.
Joseph C. Szabo,
Administrator, Federal Railroad Administration.
[FR Doc. 2011-31990 Filed 12-13-11; 8:45 am]
BILLING CODE 4910-06-P


[Federal Register Volume 82, Number 218 (Tuesday, November 14, 2017)]
[Rules and Regulations]
[Pages 52674-52675]
[FR Doc No: 2017-24633]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 372

[EPA-HQ-OPPT-2017-0197; FRL-9968-26]
RIN 2070-AK32

Community Right-to-Know; Adopting 2017 North American Industry
Classification System (NAICS) Codes for Toxics Release Inventory (TRI)
Reporting; Withdrawal

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule; withdrawal.

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

SUMMARY: In the Federal Register of August 17, 2017, EPA published both
a direct final rule and a proposed rule to update the list of NAICS
codes subject to reporting under the TRI to reflect the Office of
Management and Budget (OMB) 2017 NAICS code revision. As noted in the
direct final rule, if EPA received relevant adverse comment on the
proposed update, the Agency would publish a timely withdrawal of the
direct final rule in the Federal Register informing the public that the
direct final action will not take effect. The Agency did receive a
relevant adverse comment on the proposed update, and is therefore
withdrawing the direct final rule and will instead proceed with a final
rule based on the proposed rule after considering all public comments.

DATES: Effective November 14, 2017 the direct final rule published in
the Federal Register of August 17, 2017 (82 FR 39038) (FRL-9964-77) is
withdrawn.

FOR FURTHER INFORMATION CONTACT: For technical information contact:
Stephanie Griffin, Toxics Release Inventory Program Division (7410M),
Office of Pollution Prevention and Toxics, Environmental Protection
Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001;
telephone number:<PHONE_NUMBER>; email address:
[email protected].
    For general information contact: The Emergency Planning and
Community Right-to-Know Information Center; telephone number: (800)
424-9346, TDD<PHONE_NUMBER>; Web site: https://www.epa.gov/home/epa-hotlines.

SUPPLEMENTARY INFORMATION:

I. Does this action apply to me?

    A list of potentially affected entities is provided in the Federal
Register of August 17, 2017. If you have questions regarding the
applicability of this action to a particular entity, consult the
technical person listed under FOR FURTHER INFORMATION CONTACT.

II. What rule is being withdrawn?

    In the August 17, 2017 Federal Register, EPA published both a
direct final rule (see 82 FR 39038) and a proposed rule (see 82 FR
39101) pursuant to sections 313(g)(1) and 328 of the Emergency Planning
and Community Right-to-Know Act (EPCRA) for the purpose of updating the
list of NAICS codes subject to TRI reporting under EPCRA section 313 to
include OMB's revised 2017 NAICS codes. The action would have also
modified the list of relevant exceptions and limitations to the covered
NAICS codes included in the CFR for TRI reporting purposes.
    Since the direct final rule and proposed rule's publication, EPA
received a public comment supporting the overall update, but noting
that the direct final rule inadvertently omitted one of the covered
NAICS codes updated by OMB. As a result of this omission, EPA is
withdrawing the direct final rule published in the Federal Register on
August 17, 2017, and will instead proceed with a final rule based on
the proposed rule after considering (and responding to) all public
comments received.

III. How do I access the docket?

    To access the docket, please go to http://www.regulations.gov and
follow the online instructions using the docket identification (ID)
number EPA-HQ-OPPT-2017-0197. Additional information about the Docket
Facility is also provided under ADDRESSES in the August 17, 2017
Federal Register document. If you have questions, consult the technical
person listed under FOR FURTHER INFORMATION CONTACT.

IV. Good Cause Finding

    EPA finds that there is ``good cause'' under the Administrative
Procedure Act (APA) (5 U.S.C. 553(b)(3)(B)) to withdraw the direct
final rule discussed in this document without prior notice and comment.
Alongside the direct final rule, EPA published an identical proposed
rule and gave notice in the Federal Register that the direct final rule
would be withdrawn if the Agency received adverse comment.
    For this document, notice and comment is impracticable and
unnecessary because EPA is under a time limit to publish this
withdrawal before the direct final rule is to take effect to limit
confusion among Federal agencies and the regulated community. As such,
EPA has determined that this document is not subject to the 30-day
delay of effective date generally required by 5 U.S.C. 553(d). This
withdrawal must become effective prior to the effective date of the
direct final rule being withdrawn.

V. Statutory and Executive Order Reviews

    This document withdraws regulatory requirements that have not gone
into effect. As such, the Agency has determined that this withdrawal
will not have any adverse impacts, economic or otherwise. The statutory
and Executive Order review requirements applicable to the direct final
rule being withdrawn were discussed in the August 17, 2017 Federal
Register document. Those review requirements do not apply to this
action because it is a withdrawal and does not contain any new or
amended requirements.

VI. Congressional Review Act (CRA)

    Pursuant to the CRA (5 U.S.C. 801 et seq.), EPA will submit a
report containing this rule and other required information to the U.S.
Senate, the U.S. House of Representatives, and the Comptroller General
of the United States prior to publication of the rule in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(2). Section 808 of the CRA allows

the issuing agency to make a rule effective sooner than otherwise
provided by CRA if the agency makes a good cause finding that notice
and public procedure is impracticable, unnecessary, or contrary to the
public interest. As required by 5 U.S.C. 808(2), this determination is
supported by a brief statement in Unit IV.

List of Subjects in 40 CFR Part 372

    Environmental protection, Community right-to-know, Reporting and
recordkeeping requirements, Toxic chemicals.

    Dated: November 7, 2017.
E. Scott Pruitt,
Administrator.
[FR Doc. 2017-24633 Filed 11-13-17; 8:45 am]
 BILLING CODE 6560-50-P


[Federal Register Volume 77, Number 100 (Wednesday, May 23, 2012)]
[Notices]
[Pages 30571-30572]
[FR Doc No: 2012-12440]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67008; File No. SR-C2-2012-011]

Self-Regulatory Organizations; C2 Options Exchange, Incorporated;
Notice of Filing of a Proposed Rule Change Relating to the Adoption of
a Disaster Recovery Rule

May 17, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on May 14, 2012, C2 Options Exchange, Incorporated (the
``Exchange'' or ``C2'') filed with the Securities and Exchange
Commission (the ``Commission'') the proposed rule change as described
in Items I, II, and III below, which Items have been prepared by the
Exchange. 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

    C2 proposes to adopt a disaster recovery facility. The text of the
proposed rule change is available on the Exchange's Web site (http://www.c2exchange.com/Legal/), at the Exchange's Office of the Secretary,
and at the Commission.

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 Exchange 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 Exchange 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 the
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to adopt new Rule 6.45, which would allow for
the operation of a Disaster Recovery Facility (``DRF'') in the event a
disaster or other unusual circumstance renders the C2 trading system
inoperable. The purpose of the DRF is to allow C2 to continue to trade
exclusively-listed option classes until the Exchange's main trading
system is again available (currently, only one exclusively-listed
product trades on C2: Standard & Poor's 500 Index options with third-
Friday-of-the-month expiration dates for which the exercise settlement
value is based on the index value derived from the closing prices of
component securities (SPXPM)). An exclusively-listed option is an
option that trades exclusively on C2 because C2 has an exclusive
license to list and trade such option, or has proprietary rights in the
interest underlying the option.\3\ The DRF will provide a venue for
exclusively-listed options to continue to trade so investors may open
and close positions in those options in the event the main C2 system
becomes inoperable.
---------------------------------------------------------------------------

    \3\ Exclusively-listed options are different than ``singly-
listed options'' which are options that are not exclusively-listed
options but that are listed by an exchange and by not any other
national securities exchange. C2 does not currently trade any
singly-listed options and will take measures to ensure that it does
not trade singly-listed options in the future.
---------------------------------------------------------------------------

    C2 intends to utilize hardware located in the Chicago Board Options
Exchange, Incorporated (``CBOE'') building in Chicago, IL to run the
DRF. C2's main trade engine is currently located on the East coast. As
proposed, trading on the DRF would be identical to trading on C2. All
C2 trading rules would continue to apply (including rules applicable to
market-making) and the C2 fee schedule would continue to apply. Thus,
the transition to the DRF would be relatively seamless for users. The
Exchange is conducting testing with C2 Trading Permit Holders
(``TPHs'') to facilitate their readiness to trade on the DRF (a
certification process is also employed). To that end, DRF test plan
documents are currently available to all TPHs.\4\
---------------------------------------------------------------------------

    \4\ Completion of the test plan generally prepares a TPH to be
ready to trade on the DRF if necessary.
---------------------------------------------------------------------------

    The Exchange expects the DRF to be continuously usable and
available, as needed. In connection with the commencement of trading on
the DRF, C2 would announce its activation and identify the classes that
would be available for trading. As previously mentioned, all classes
traded via the DRF would be subject to all applicable C2 rules
including non-trading rules. As soon as C2's main trading system
becomes operable, the Exchange would resume trading on the main C2
platform and cease trading on the DRF.
    Proposed Rule 6.45 also provides that TPHs shall take such action
as instructed by the Exchange to accommodate the Exchange's ability to
trade options via the DRF. As mentioned above, such actions will
include an Exchange certification process to ensure that TPHs are
prepared to migrate to the DRF when necessary. All C2 TPHs, including
those that may only be a C2 TPH (and not a CBOE trading permit holder)
will have access to the DRF.
    The Exchange expects the DRF to be operational shortly, and it will
be continuously maintained so that it would always be available if
needed. The Exchange has written supervisory procedures that cover
activation and use of the DRF. To the extent trading on the DRF is ever
necessary, those procedures will help ensure that the transition to the
DRF is handled efficiently and effectively. Lastly, the Exchange
represents that it and CBOE have the necessary systems capacity to
handle trading associated with the DRF including the extra quotation
traffic that would be processed through the hardware located in the
CBOE building.
2. Statutory Basis
    The basis under the Securities Exchange Act of 1934 (the ``Act'')
for this proposed rule change is the requirement under Section 6(b)(5)
\5\ that an exchange have rules that are designed to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, to promote just and equitable principles of
trade, and to remove impediments to and perfect the mechanism for a
free and open market and a national market system, and, in general, to
protect investors and the public interest. In particular, the Exchange
believes that providing a venue for C2 TPHs to continue to trade
options that are only available for trading on C2 in the event the C2
system is rendered inoperable, facilitates transactions in securities
and helps remove impediments to a free and open market and a national
market system. This protects investors and serves the public interest
in that investors with open positions will have the ability to trade
out of those positions if C2 is unavailable, which is also consistent
with Section 6(b) of the Act.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    C2 does not believe that the proposed rule change will impose any
burden on competition that is not necessary or

appropriate in furtherance of the purposes of the Act.

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

    The Exchange neither solicited nor received comments 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 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-C2-2012-011 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-C2-2012-011. 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
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. 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-C2-2012-011 and should be
submitted on or before June 13, 2012.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\6\
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    \6\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-12440 Filed 5-22-12; 8:45 am]
BILLING CODE 8011-01-P