[Federal Register Volume 85, Number 103 (Thursday, May 28, 2020)]
[Notices]
[Pages 32082-32085]
[FR Doc No: 2020-11473]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-88932; File No. SR-NASDAQ-2020-019]

Self-Regulatory Organizations; The Nasdaq Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Make Certain Amendments To Eliminate the Requirement That the Intraday
Indicative Value Be Disseminated for Certain Series of Index Fund
Shares and All Series of Managed Fund Shares

May 22, 2020.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on May 14, 2020, The Nasdaq Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I and II 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to eliminate the requirement that the
Intraday Indicative Value be disseminated as set forth under Nasdaq
Rule 5705(b) (``Index Fund Shares'') for certain series of Index Fund
Shares and under Nasdaq Rule 5735 (``Managed Fund Shares'') for all
series of Managed Fund Shares. Additionally, the Exchange proposes to
define the term ``Portfolio Holdings'' as it pertains to Index Fund
Shares. Finally, the Exchange proposes to amend Nasdaq Rule 4120 (Limit
Up-Limit Down Plan and Trading Halts) as it pertains to dissemination
of the Intraday Indicative Value.
    The text of the proposed rule change is available on the Exchange's
website at http://nasdaq.cchwallstreet.com, at the principal office of
the Exchange, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the 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
Statutory Basis for, the Proposed Rule Change

1. Purpose
    Nasdaq Rules 5705(b) and 5735 relate to the listing and trading of
Index Fund Shares and Managed Fund Shares, respectively, on the
Exchange. Among a number of other requirements, numerous subparagraphs
of each of these rules require that an intraday estimate of the value
of a share of each series (the ``Intraday Indicative Value'' or
``IIV'') of Index Fund Shares and Managed Fund Shares be disseminated
and updated at least every 15 seconds.\3\ The Exchange is proposing to
eliminate the requirement to disseminate an IIV for all series of
Managed Fund Shares \4\ listed on the Exchange and for those series of
Index Fund Shares that also publish their Portfolio Holdings (as
defined below) on a daily basis.
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    \3\ See subparagraphs (3)(C), (6)(A), and (9)(B)(i)e. of Nasdaq
Rule 5705(b). See also subparagraphs (c)(3), (c)(4), (d)(2)(A),
(d)(2)(C)(ii), and (d)(2)(D) of Nasdaq Rule 5735.
    \4\ The Exchange notes that Nasdaq Rule 5735(d)(2)(B)(i)
requires that the Disclosed Portfolio for a series of Managed Fund
Shares be disseminated at least once daily and be made available to
all market participants at the same time. Further, Nasdaq
5735(d)(2)(C)(ii) requires that the Exchange consider suspension of
trading in and commence delisting proceedings for a series of
Managed Fund Shares where the Disclosed Portfolio is not made
available to all market participants at the same time. As such, the
Exchange is proposing to eliminate the IIV dissemination
requirements entirely from Nasdaq Rule 5735.
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    As part of this proposal, the Exchange is also proposing to adopt
proposed Nasdaq Rule 5705(b)(1)(F) to define the term ``Portfolio
Holdings'' to mean the holdings of a particular series of Index Fund
Shares that will form the basis for the calculation of its net asset
value (``NAV'') at the end of the business day.\5\ Existing Nasdaq
Rules require issuers of Managed Fund Shares to provide IIV and daily
disclosure of the Disclosed Portfolio.\6\ Similarly, existing Exchange
Rules require issuers of Index Fund Shares to disseminate an IIV for
each fund, but do not universally require daily disclosure of a fund's
underlying holdings.
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    \5\ For purposes of Nasdaq Rule 5705(b), Portfolio Holdings
would include various information, to the extent applicable, as
listed in proposed subparagraphs (1)(F)(i) through (1)(F)(xi). The
proposed definition of Portfolio Holdings is substantively identical
to the definition of ``Disclosed Portfolio'' as set forth in Nasdaq
Rule 5735(c)(2).
    \6\ See subparagraphs (c)(2), (d)(1)(B), and (d)(2)(B)(i) of
Nasdaq Rule 5735. The term ``Disclosed Portfolio'' (as defined in
Nasdaq Rule 5735(c)(2)) means the identities and quantities of the
securities and other assets held by the Investment Company that will
form the basis for the Investment Company's calculation of net asset
value at the end of the business day.
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    The dissemination of an IIV, together with disclosure of the fund's
underlying holdings, was designed to allow investors to determine the
value of the underlying portfolio of such funds on a daily basis and
provide a close estimate of that value throughout the trading day.
However, as consistently highlighted in the adopting release of Rule 17
CFR 270.6c-11 (``Rule 6c-11'') \7\ under the Investment Company Act of
1940 \8\ (the ``1940 Act''), the Commission has expressed concerns
regarding the

accuracy of IIV estimates for certain Exchange-Traded Funds
(``ETFs'').\9\
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    \7\ See Investment Company Act Release No. 10695 (September 25,
2019), 84 FR 57162 (October 24, 2019) (the ``Adopting Release'').
    \8\ 15 U.S.C. 80a-1.
    \9\ An Exchange-Traded Fund means a registered open-end
investment company: (i) That issues (and redeems) creation units to
(and from) authorized participants in exchange for a basket and a
cash balancing amount if any; and (ii) Whose shares are listed on a
national securities exchange and traded at market-determined prices.
See supra note 7.
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    Specifically, the Commission noted that an IIV may not accurately
reflect the value of an ETF that holds securities that trade less
frequently as such IIV can be stale or inaccurate.\10\ Similarly, the
Commission also expressed concerns with the IIV of ETFs with frequently
traded component securities because ``in today's fast moving markets,
given the dissemination lags, an IIV may not accurately reflect the
value of an ETF that holds frequently traded component securities.''
\11\ Additionally, the Commission indicated that even in circumstances
when an IIV may be reliable, retail investors do not have easy access
to free, publicly available IIV information.\12\ Further, in instances
when IIV may be free and publicly available, it can be delayed by up to
45 minutes.\13\
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    \10\ Id. at 62.
    \11\ Id.
    \12\ Id. at 66.
    \13\ Id.
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    Aside from the fact that the disseminated IIV may provide investors
with stale or misleading data, the Commission also stated that market
makers and authorized participants typically calculate their own
intraday value of an ETF's portfolio with proprietary algorithms that
use an ETF's daily portfolio disclosure and available pricing
information.\14\ Such information allows those market participants to
support the arbitrage mechanism for ETFs.
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    \14\ Id. at 63.
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    The arbitrage mechanism is designed to help keep the market price
of ETF shares at or close to the NAV per share of an ETF, and is
important because it helps to ensure ETF investors are treated
equitably when buying and selling fund shares.\15\ Therefore, as market
participants who engage in arbitrage typically calculate their own
intraday value of an ETF's portfolio based on the ETF's daily portfolio
disclosure and pricing information and use an IIV only as a secondary
check to their own calculation,\16\ the Commission noted that IIV was
not necessary to support the arbitrage mechanism.\17\
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    \15\ Id. at 12.
    \16\ Id. at 63.
    \17\ Id. at 65.
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    Given this, combined with shortcomings of the IIV noted above, the
Commission concluded that ETFs will not be required to disseminate an
IIV under Rule 6c-11.\18\ As such, Exchange listing rules are the only
reason that a series of Managed Fund Shares is required to disseminate
an IIV. Similarly, Exchange listing rules are the only reason that a
series of Index Fund Shares that also publishes its Portfolio Holdings
on a daily basis is required to disseminate an IIV.
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    \18\ Id. at 61.
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    The Exchange believes that the limitations and shortcomings of IIV
as it pertains to ETFs relying on Rule 6c-11 and highlighted in the
Adopting Release are equally applicable to all Managed Fund Shares
listed on the Exchange and Index Fund Shares for which the Portfolio
Holdings are disclosed on a daily basis. The Exchange further agrees
with the conclusion of the Adopting Release that the ``IIV is not
necessary to support the arbitrage mechanism for ETFs that provide
daily portfolio holdings disclosure.''
    The transparency that comes from daily portfolio holdings
disclosure provides market participants with sufficient information to
facilitate the intraday valuation of the shares of an ETF, including
Managed Fund Shares and Index Fund Shares for which Portfolio Holdings
are disclosed daily, which, ignoring the many criticisms of IIV in the
Adopting Order, renders IIV at the very least duplicative and
unnecessary. The Commission has previously approved a proposed rule
change by Cboe BZX Exchange, Inc. (``Cboe BZX'') that is substantively
identical to the proposed amendments to Nasdaq Rules 5705(b) and
5735.\19\
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    \19\ See Securities Exchange Act Release No. 88558 (April 3,
2020), 85 FR 20012 (April 9, 2020) (SR-CboeBZX-2020-007) (Order
Approving a Proposed Rule Change, as Modified by Amendment No. 1, To
Eliminate the Requirement That an Intraday Indicative Value Be
Disseminated as Set Forth Under Rule 14.11(c) for Certain Series of
Index Fund Shares and Under Rule 14.11(i) for All Series of Managed
Fund Shares).
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    Therefore, the Exchange is proposing to eliminate the requirement
for the dissemination of the IIV for all series of Managed Fund Shares
and for Index Fund Shares for which Portfolio Holdings are disclosed on
a daily basis.
    In addition, the Exchange is proposing to amend Nasdaq Rule
4120(a)(9) to remove certain references to Managed Fund Shares as it
relates to halting a series of Managed Fund Shares for not
disseminating an IIV. Managed Fund Shares are not required to
disseminate and [sic] underlying index value and, as a result of this
rule proposal, would not be required to disseminate an IIV. Nasdaq
believes that including Managed Fund Shares as a security that can be
halted for not disseminating an underlying index value or an IIV is no
longer necessary. The Exchange notes that this proposal does not seek
to remove certain references to Index Fund Shares because Nasdaq Rule
4120(a)(9) only applies to Index Fund Shares if dissemination of an
underlying index value or IIV is required.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\20\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\21\ in particular, in that it is consistent with
the Section 6(b)(5) requirements that the rules of an exchange be
designed to prevent fraudulent and manipulative acts and practices, to
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest.
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    \20\ 15 U.S.C. 78f(b).
    \21\ 15 U.S.C. 78f(b)(5).
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    The proposed amendment seeks to eliminate the requirement that
Managed Fund Shares and Index Fund Shares for which the Portfolio
Holdings are disclosed daily disseminate an IIV for the same reasons
articulated in the Adopting Order for Rule 6c-11, which does not
require the dissemination of IIV. The Exchange believes that the
proposed amendment will eliminate the dissemination of potentially
stale and misleading IIV information to market participants, as was
also noted in the Adopting Order. Further, as the proposed rule text
would only eliminate the requirement for series of Index Fund Shares
\22\ and Managed Fund Shares \23\ that provide full daily portfolio
transparency, such full daily portfolio transparency would provide
market participants with a tool to calculate the IIV of a series of
Managed Fund Shares or Index Fund Shares, which the Exchange believes
generally mitigates the need for the dissemination of an IIV.
Nonetheless, nothing in this proposal limits the ability of such Index
Fund Shares or Managed Fund Shares from disseminating the IIV should
they

choose to do so. Further, the Exchange notes that its rules still
include certain circumstances in which an issuer would be required to
disseminate an IIV.\24\
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    \22\ As provided in proposed Rules 5705(b)(3)(C) and
5705(b)(6)(A), a series of Index Fund Shares would only be exempt
from IIV dissemination requirements where there is daily public
website disclosure of Portfolio Holdings.
    \23\ See supra note 4.
    \24\ For example, a series of Index Fund Shares that does not
provide daily portfolio transparency would still be required to
disseminate an IIV. Additionally, IIV dissemination will continue to
be required for certain products that are not subject to the 1940
Act. Moreover, the Exchange notes that Nasdaq Rules related to the
listing and trading of other product types (that is, products that
are not listed pursuant to Nasdaq Rule 5705(b) or 5735) require the
dissemination of an IIV, which the Exchange is not proposing to
eliminate at this time. Specifically, the Exchange is only proposing
to remove the requirement of IIV dissemination as it pertains to
certain Index Fund Shares and all Managed Fund Shares because such
product types represent the vast majority of products listed on the
Exchange and may consider proposing to eliminate the IIV
dissemination requirement for other product types in a future
proposal.
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    As a result of the proposed rule change, the Exchange believes
issuers may benefit from cost savings because of the eliminated
requirement to disseminate an IIV. The reduced cost could also result
in lower barriers to entry for new issuers and new series of Managed
Fund Shares and Index Fund Shares for which the Portfolio Holdings are
disclosed daily, which will result in enhanced competition among
products and issuers of such funds, which can lead to lower fees for
investors, encourage financial innovation, and increase investor choice
in the ETF market.
    Finally, with respect to the proposed change to Nasdaq Rule
4120(a)(9) to remove Managed Fund Shares, the Exchange believes that
this strengthens the consistency among Nasdaq's rules and benefits
investors and the marketplace by making clear rules that lessen
potential confusion for market participants.

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

    The Exchange 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. To the contrary, the
Exchange believes that issuers may benefit from cost savings and lower
barriers to entry because of the eliminated requirement to disseminate
an IIV. In turn, the proposed rule change will enable increased product
competition among issuers of such funds, which can lead to lower fees
for investors, encourage financial innovation, and increase investor
choice in the ETF market.

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

    No written comments were either solicited or received.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \25\ and Rule 19b-
4(f)(6) thereunder.\26\
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    \25\ 15 U.S.C. 78s(b)(3)(A).
    \26\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change, along
with a brief description and text of the proposed rule change, at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \27\ normally
does not become operative for 30 days after the date of the filing.
However, pursuant to Rule 19b-4(f)(6)(iii),\28\ the Commission may
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposed
rule change may become operative immediately upon filing. The Exchange
states that the proposed rule change will lead to listing standards
that are substantially similar to the rules of Cboe BZX that the
Commission has recently approved.\29\ The Commission notes that the
proposed rule change raises no novel or unique issues not already
considered by the Commission. Therefore, the Commission believes that
waiver of the 30-day operative delay is consistent with the protection
of investors and the public interest. Accordingly, the Commission
hereby waives the 30-day operative delay and designates the proposal
operative upon filing.\30\
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    \27\ 17 CFR 240.19b-4(f)(6).
    \28\ 17 CFR 240.19b-4(f)(6)(iii).
    \29\ See supra note 19.
    \30\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule change's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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    At any time within 60 days of the filing of such proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \31\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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    \31\ 15 U.S.C. 78s(b)(2)(B).
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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-NASDAQ-2020-019 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NASDAQ-2020-019. 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 website (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 website 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. Persons submitting comments are

cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NASDAQ-2020-019 and should be submitted
on or before June 18, 2020.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\32\
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    \32\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-11473 Filed 5-27-20; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 36 (Friday, February 22, 2019)]
[Proposed Rules]
[Pages 5620-5622]
[FR Doc No: 2019-02933]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. FAA-2019-0021; Product Identifier 2018-NM-038-AD]
RIN 2120-AA64

Airworthiness Directives; AmSafe Inc. Seatbelts

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: We propose to adopt a new airworthiness directive (AD) for all
AmSafe Inc. seatbelts, as installed in, but not limited to, various
airplanes and rotorcraft. This proposed AD was prompted by reports of
multiple failed keepers on seatbelt hook assemblies. This proposed AD
would require an inspection for affected parts, repetitive general
visual inspections of the seatbelt hook assembly for damage, repetitive
functional checks, and replacement of all affected parts. We are
proposing this AD to address the unsafe condition on these products.

DATES: We must receive comments on this proposed AD by April 8, 2019.

ADDRESSES: You may send comments, using the procedures found in 14 CFR
11.43 and 11.45, by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the instructions for submitting comments.
     Fax:<PHONE_NUMBER>.
     Mail: U.S. Department of Transportation, Docket
Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New
Jersey Avenue SE, Washington, DC 20590.
     Hand Delivery: Deliver to Mail address above between 9
a.m. and 5 p.m., Monday through Friday, except Federal holidays.
    For service information identified in this NPRM, contact AmSafe
Inc., 1043 N 47th Avenue, Phoenix, AZ 85043; telephone:<PHONE_NUMBER>;
fax:<PHONE_NUMBER>; internet: https://www.amsafe.com. You may view this
service information at the FAA, Transport Standards Branch, 2200 South
216th St., Des Moines, WA. For information on the availability of this
material at the FAA, call<PHONE_NUMBER>.

Examining the AD Docket

    You may examine the AD docket on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2019-
0021; or in person at Docket Operations between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays. The AD docket contains
this NPRM, the regulatory evaluation, any comments received, and other
information. The street address for Docket Operations (phone: 800-647-
5527) is in the ADDRESSES section. Comments will be available in the AD
docket shortly after receipt.

FOR FURTHER INFORMATION CONTACT: Patrick Farina, Aerospace Engineer,
Cabin Safety and Environmental Systems Section, FAA, Los Angeles ACO
Branch, 3960 Paramount Boulevard, Lakewood, CA 90712-4137; phone: 562-
627-5344; fax:<PHONE_NUMBER>; email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Comments Invited

    We invite you to send any written relevant data, views, or
arguments about this proposal. Send your comments to an address listed
under the ADDRESSES section. Include ``Docket No. FAA-2019-0021;
Product Identifier 2018-NM-038-AD'' at the beginning of your comments.
We specifically invite comments on the overall regulatory, economic,
environmental, and energy aspects of this NPRM. We will consider all
comments received by the closing date and may amend this NPRM because
of those comments.
    We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We
will also post a report summarizing each substantive verbal contact we
receive about this NPRM.

Discussion

    We have received a report indicating that failed keepers on
seatbelt hook assemblies have been found on multiple transport category
airplanes. These seatbelt hook assemblies might also be installed on
other types of aircraft. The keepers have been found with the metal
bridge above the spring bent or broken in a way that does not allow the
seatbelt hook assemblies to be securely fastened to the seat structure.
Failure of keepers on seatbelt hook assemblies, if not addressed, could
result in the seatbelt disengaging from and detaching from the seat
structure under certain conditions, and could result in injury to
passengers or flightcrew.

Related Service Information Under 1 CFR Part 51

    We reviewed AmSafe Safety Bulletin SB505960-01, Issue 5, dated
August 6, 2018. The service information describes procedures for an
inspection for affected

parts, repetitive general visual inspections of the seatbelt hook
assembly for damage (including compressed springs, bends, rotation or
deformation of the bridge), repetitive functional checks and
replacement. This service information is reasonably available because
the interested parties have access to it through their normal course of
business or by the means identified in the ADDRESSES section.

FAA's Determination

    We are proposing this AD because we evaluated all the relevant
information and determined the unsafe condition described previously is
likely to exist or develop in other products of the same type designs.

Proposed AD Requirements

    This proposed AD would require accomplishing the actions specified
in the service information described previously, except as discussed
under ``Differences Between this Proposed AD and the Service
Information.''

Differences Between This Proposed AD and the Service Information

    AmSafe Safety Bulletin SB505960-01, Issue 5, dated August 6, 2018,
specifies to return parts to the manufacturer. This proposed AD would
not include that requirement.

Costs of Compliance

    We estimate that this proposed AD affects 100,000 appliances
installed on, but not limited to, various airplanes and rotorcraft of
U.S. registry. We estimate the following costs to comply with this
proposed AD:

                                                 Estimated Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost on U.S.
              Action                    Labor cost        Parts cost      Cost per product        operators
----------------------------------------------------------------------------------------------------------------
Inspection for affected part.....  1 work-hour x $85                $0  $85................  $8,500,000.
                                    per hour = $85.
Repetitive inspections and         1 work-hour x $85                 0  $85 per inspection   $8,500,000 per
 functional checks.                 per hour = $85 per                   cycle.               inspection cycle.
                                    inspection cycle.
Replacement......................  1 work-hour x $85                28  $113...............  $11,300,000.
                                    per hour = $85.
----------------------------------------------------------------------------------------------------------------

    We estimate the following costs to do any necessary replacements
that would be required based on the results of the proposed inspection.
We have no way of determining the number of aircraft that might need
these replacements:

                                               On-Condition Costs
----------------------------------------------------------------------------------------------------------------
                                                                                Cost per
                    Action                                 Labor cost               Parts cost        product
----------------------------------------------------------------------------------------------------------------
Replacement...................................  1 work-hour x $85 per hour = $85             $28            $113
----------------------------------------------------------------------------------------------------------------

    According to the manufacturer, some or all of the costs of this
proposed AD may be covered under warranty, thereby reducing the cost
impact on affected individuals. We do not control warranty coverage for
affected individuals. As a result, we have included all known costs in
our cost estimate.

Authority for This Rulemaking

    Title 49 of the United States Code specifies the FAA's authority to
issue rules on aviation safety. Subtitle I, section 106, describes the
authority of the FAA Administrator. Subtitle VII: Aviation Programs,
describes in more detail the scope of the Agency's authority.
    We are issuing this rulemaking under the authority described in
Subtitle VII, Part A, Subpart III, Section 44701: ``General
requirements.'' Under that section, Congress charges the FAA with
promoting safe flight of civil aircraft in air commerce by prescribing
regulations for practices, methods, and procedures the Administrator
finds necessary for safety in air commerce. This regulation is within
the scope of that authority because it addresses an unsafe condition
that is likely to exist or develop on products identified in this
rulemaking action.
    This proposed AD is issued in accordance with authority delegated
by the Executive Director, Aircraft Certification Service, as
authorized by FAA Order 8000.51C. In accordance with that order,
issuance of ADs is normally a function of the Compliance and
Airworthiness Division, but during this transition period, the
Executive Director has delegated the authority to issue ADs applicable
to transport category airplanes and associated appliances to the
Director of the System Oversight Division.

Regulatory Findings

    We determined that this proposed AD would not have federalism
implications under Executive Order 13132. This proposed AD would not
have a substantial direct effect on the States, on the relationship
between the national Government and the States, or on the distribution
of power and responsibilities among the various levels of government.
    For the reasons discussed above, I certify this proposed
regulation:
    (1) Is not a ``significant regulatory action'' under Executive
Order 12866,
    (2) Is not a ``significant rule'' under the DOT Regulatory Policies
and Procedures (44 FR 11034, February 26, 1979),
    (3) Will not affect intrastate aviation in Alaska, and
    (4) Will not have a significant economic impact, positive or
negative, on a substantial number of small entities under the criteria
of the Regulatory Flexibility Act.

List of Subjects in 14 CFR Part 39

    Air transportation, Aircraft, Aviation safety, Incorporation by
reference, Safety.

The Proposed Amendment

    Accordingly, under the authority delegated to me by the
Administrator, the FAA proposes to amend 14 CFR part 39 as follows:

PART 39--AIRWORTHINESS DIRECTIVES

0
1. The authority citation for part 39 continues to read as follows:

    Authority:  49 U.S.C. 106(g), 40113, 44701.

Sec.  39.13   [Amended]

0
2. The FAA amends Sec.  39.13 by adding the following new airworthiness
directive (AD):

AmSafe Inc. Seatbelts: Docket No. FAA-2019-0021; Product Identifier
2018-NM-038-AD.

(a) Comments Due Date

    We must receive comments by April 8, 2019.

(b) Affected ADs

    None.

(c) Applicability

    This AD applies to AmSafe Inc. seatbelts installed on various
airplanes and rotorcraft, certificated in any category, including,
but not limited to, the airplanes of the manufacturers specified in
paragraphs (c)(1) through (c)(5) of this AD.

(1) Airbus SAS
(2) The Boeing Company
(3) Bombardier, Inc.
(4) Embraer S.A.
(5) Fokker Services B.V.

(d) Subject

    Air Transport Association (ATA) of America Code 25, Equipment/
furnishings.

(e) Unsafe Condition

    This AD was prompted by reports of multiple failed keepers on
seatbelt hook assemblies. We are issuing this AD to address failed
keepers on seatbelt hook assemblies. Failure of keepers on seatbelt
hook assemblies, if not addressed, could result in the seatbelt
disengaging from and detaching from the seat structure under certain
conditions, and could result in injury to passengers or flightcrew.

(f) Compliance

    Comply with this AD within the compliance times specified,
unless already done.

(g) Inspection for Affected Parts

    For any seatbelt buckle half and connector half having a part
number listed in Table 1 of paragraph ``1.1., Effectivity'' of
AmSafe Safety Bulletin SB505960-01, Issue 5, dated August 6, 2018:
Within 180 days after the effective date of this AD, do a general
visual inspection of each seatbelt buckle half and connector half to
determine whether the seatbelt hook assembly has exposed springs, in
accordance with AmSafe Safety Bulletin SB505960-01, Issue 5, dated
August 6, 2018.
    (1) An affected part is any seatbelt buckle half or connector
half that has a seatbelt hook assembly with exposed springs.
    (2) An unaffected part is any seatbelt buckle half or connector
half that has a seatbelt hook assembly without exposed springs.

(h) Repetitive Inspections and Functional Checks

    Within 180 days after the effective date of this AD, do a
general visual inspection of each affected part for damage to the
seatbelt hook assembly and do a functional check in accordance with
AmSafe Safety Bulletin SB505960-01, Issue 5, dated August 6, 2018.
    (1) If any seatbelt hook assembly is damaged or the part fails
the functional check, before further flight, replace the part with a
new or serviceable part. If an affected part is installed, repeat
the inspection and functional check at intervals not to exceed 24
months or at the next scheduled heavy maintenance check, whichever
occurs first, until the actions specified in paragraph (i) of this
AD are done.
    (2) If an affected part is undamaged and passes the functional
check, repeat the inspection and functional check at intervals not
to exceed 24 months or at the next scheduled heavy maintenance
check, whichever occurs first, until the actions specified in
paragraph (i) of this AD are done.

(i) Terminating Action

    Within 58 months after the effective date of this AD, replace
all affected parts with unaffected parts in accordance with AmSafe
Safety Bulletin SB505960-01, Issue 5, dated August 6, 2018.
Replacing all affected parts with unaffected parts on a seatbelt
hook assembly terminates the repetitive inspections and functional
checks specified in paragraph (h) of this AD for that seatbelt hook
assembly. Replacing all affected parts with unaffected parts on an
airplane or rotorcraft terminates the repetitive inspections and
functional checks specified in paragraph (h) of this AD for that
airplane or rotorcraft.

(j) Parts Installation Prohibition

    No person may install on any seat an affected part as of the
time specified in paragraph (j)(1), (j)(2), or (j)(3) of this AD, as
applicable.
    (1) For seats on which, as of the effective date of this AD any
affected part is found during the inspection required by paragraph
(g) of this AD: After replacement of the affected part(s) with
unaffected part(s).
    (2) For seats on which no affected parts are found during the
inspection required by paragraph (g) of this AD: As of the date of
the inspection required by paragraph (g) of this AD.
    (3) For seats on which both the seatbelt buckle half and
connector half have part numbers not listed in Table 1 of paragraph
``1.1., Effectivity'' of AmSafe Safety Bulletin SB505960-01, Issue
5, dated August 6, 2018: As of the effective date of this AD.

(k) No Return of Parts

    Although AmSafe Safety Bulletin SB505960-01, Issue 5, dated
August 6, 2018, specifies to return parts to the manufacturer, this
AD does not require the return of the parts to the manufacturer.

(l) Credit for Previous Actions

    This paragraph provides credit for the actions specified in
paragraphs (g), (h), and (i) of this AD, if those actions were
performed before the effective date of this AD using the service
information specified in paragraphs (l)(1) or (l)(2), of this AD.
    (1) AmSafe Safety Bulletin SB505960-01, Issue 3, dated April 19,
2018.
    (2) AmSafe Safety Bulletin SB505960-01, Issue 4, dated July 12,
2018.

(m) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Los Angeles ACO Branch, FAA, has the authority
to approve AMOCs for this AD, if requested using the procedures
found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your
request to your principal inspector or local Flight Standards
District Office, as appropriate. If sending information directly to
the manager of the certification office, send it to the attention of
the person identified in paragraph (n)(1) of this AD. Information
may be emailed to<EMAIL_ADDRESS>    (2) Before using any approved AMOC, notify your appropriate
principal inspector, or lacking a principal inspector, the manager
of the local flight standards district office/certificate holding
district office.

(n) Related Information

    (1) For more information about this AD, contact Patrick Farina,
Aerospace Engineer, Cabin Safety and Environmental Systems Section,
FAA, Los Angeles ACO Branch, 3960 Paramount Boulevard, Lakewood, CA
90712-4137; phone:<PHONE_NUMBER>; fax:<PHONE_NUMBER>; email:
<EMAIL_ADDRESS>    (2) For service information identified in this AD, contact
AmSafe Inc., 1043 N 47th Avenue, Phoenix, AZ 85043; telephone: 602-
850-2850; fax:<PHONE_NUMBER>; internet: https://www.amsafe.com. You
may view this service information at the FAA, Transport Standards
Branch, 2200 South 216th St., Des Moines, WA. For information on the
availability of this material at the FAA, call<PHONE_NUMBER>.

    Issued in Des Moines, Washington, on February 8, 2019.
Michael Kaszycki,
Acting Director, System Oversight Division, Aircraft Certification
Service.
[FR Doc. 2019-02933 Filed 2-21-19; 8:45 am]
 BILLING CODE 4910-13-P


[Federal Register: January 6, 2009 (Volume 74, Number 3)]
[Notices]
[Page 485-486]
[DOCID:fr06ja09-80]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59169; File No. SR-NYSEALTR-2008-18]

Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by NYSE Alternext US LLC Amending
NYSE Alternext US, LLC Equities Rule 48.10 To Extend the Temporary
Provisions of the Rule Relating to the Ability of the Exchange To
Declare an Extreme Market Volatility Condition and Suspend Certain
Exchange Requirements Relating to the Closing of Securities at the
Exchange

December 29, 2008.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on December 24, 2008, NYSE Alternext US LLC (the
``Exchange'' or ``NYSE Alternext'') filed with the Securities and
Exchange Commission (the ``Commission'') the proposed rule change as
described in Items I and II below, which Items have been prepared by
the self-regulatory organization. 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

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

    The Exchange proposes to amend NYSE Alternext US, LLC (``NYSE
Alternext'' or the ``Exchange'') Equities Rule 48.10 to extend the
temporary provisions of the rule relating to the ability of the
Exchange to declare an extreme market volatility condition and suspend
certain Exchange requirements relating to the closing of securities at
the Exchange.
    The text of the proposed rule change is available at http://
www.nyse.com, NYSE Alternext, and the Commission's Public Reference
Room.

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

    In its filing with the Commission, the self-regulatory organization
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 those 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 parts of such statements.

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

1. Purpose
    The Exchange proposes to amend NYSE Alternext Equities Rule 48.10
to temporarily extend the provisions of the rule relating to declaring
an extreme market volatility condition at the close.
    On November 26, 2008, NYSE Alternext filed a rule proposal to
conform its rules to those of the New York Stock Exchange LLC
(``NYSE'').\4\ Among the rules amended in that filing was Rule 48,
which was previously amended by the NYSE. On October 2, 2008, the NYSE
filed for immediate effectiveness to amend NYSE Rule 48 to provide the
NYSE with the ability to suspend certain rules at the close when
extremely high market volatility could negatively affect the ability to
ensure a fair and orderly close.\5\ The NYSE amended Rule 48 on an
immediate effectiveness basis in order to respond swiftly to market
conditions at that time. Those amendments were adopted on a temporary
basis with the understanding that if the NYSE would like to adopt the
closing provisions on a permanent basis, such proposal must be filed
under Section 19(b)(2) of the Act.\6\
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 34-59022 (Nov. 26,
2008), 73 FR 73683 (Dec. 3, 2008) (SR-NYSEALTR-2008-10).
    \5\ See SEC Release No. 34-58743 (Oct. 7, 2008), 73 FR 60742
(Oct. 14, 2008) (SR-NYSE-2008-102).
    \6\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

    The Exchange intends soon to file a rule proposal to amend NYSE
Alternext Equities Rules 48 and 123C to delete from Rule 48 the
provisions relating to declaring an extreme market volatility condition
at the close and add them in modified form to Rule 123C (the ``Rule 48/
123C filing''). That rule proposal would be filed under Section
19(b)(2) of the Securities Exchange Act of 1934 (the ``Act'').\7\ The
Exchange now proposes to temporarily extend the NYSE Alternext Equities
Rule 48 at-the-close provisions pending the outcome of the Rule 48/123C
filing. Accordingly, the Exchange proposes to amend Rule 48.10 to
provide that the provisions of that rule relating to declaring an
extreme market volatility condition at the close will end on March 27,
2009.
---------------------------------------------------------------------------

    \7\ Id.
---------------------------------------------------------------------------

2. Statutory Basis
    The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \8\ that an Exchange have rules that
are designed to promote just and equitable principles of trade, to
remove impediments to and perfect the mechanism of a free and open
market and a national market system and, in general, to protect
investors and the public interest.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    The Exchange 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

    No written comments were solicited or received with respect to the
proposed rule change.

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

    Because the foregoing proposed rule change: (1) Does not
significantly affect the protection of investors or the public
interest; (2) does not impose any

significant burden on competition; and (3) by its terms, does not
become operative for 30 days after the date of filing, or such shorter
time as the Commission may designate if consistent with the protection
of investors and the public interest, the proposed rule change has
become effective pursuant to Section 19(b)(3)(A) of the Act \9\ and
Rule 19b-4(f)(6) thereunder.\10\
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) normally does
not become operative for 30 days after the date of filing.\11\ However,
Rule 19b-4(f)(6)(iii) permits the Commission to designate a shorter
time if such action is consistent with the protection of investors and
the public interest. NYSE Alternext requested that the Commission waive
the 30-day operative delay, as specified in Rule 19b-4(f)(6)(iii),\12\
which would make the rule change effective and operative upon filing.
---------------------------------------------------------------------------

    \11\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires the self-regulatory organization to give the
Commission notice of its intent to file the proposed rule change,
along with a brief description and text of the proposed rule change,
at least five business days prior to the date of filing of the
proposed rule change, or such shorter time as designated by the
Commission. The Exchange has satisfied this requirement.
    \12\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    The Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest
because it will allow the Exchange to extend without interruption the
provisions of Rule 48 regarding the Exchange's ability to declare an
extreme market volatility condition at the close and suspend certain
rules relating to closing of securities on the Exchange. These
provisions are currently scheduled to expire on December 31, 2008. The
Commission notes the Exchange's representation that it soon intends to
file a proposal to establish permanent rules regarding closing of
securities subject to an extreme order imbalance at the close. In light
of the foregoing, the Commission designates the proposal operative upon
filing.\13\
---------------------------------------------------------------------------

    \13\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.\14\
---------------------------------------------------------------------------

    \14\ 15 U.S.C. 78s(b)(3)(C).
---------------------------------------------------------------------------

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 e-mail to<EMAIL_ADDRESS>Please include
File Number SR-NYSEALTR-2008-18 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSEALTR-2008-18. This
file number should be included on the subject line if e-mail 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 inspection
and copying in the Commission's Public Reference Room, 100 F Street,
NE., Washington, DC 20549, on official business days between the hours
of 10 a.m. and 3 p.m. Copies of such filing also will be available for
inspection and copying at the 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-NYSEALTR-2008-18 and should
be submitted on or before January 27, 2009.
---------------------------------------------------------------------------

    \15\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-31349 Filed 1-5-09; 8:45 am]

BILLING CODE 8011-01-P


[Federal Register: April 3, 2008 (Volume 73, Number 65)]
[Notices]
[Page 18267-18270]
[DOCID:fr03ap08-49]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

 [Docket No. AD08-2-000]

 Order on Technical Conference

Issued March 20, 2008.
AGENCY: Federal Energy Regulatory Commission.

ACTION: Order on Technical Conference.

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

SUMMARY: On December 11, 2008, the Federal Energy Regulatory Commission
convened a technical conference on interconnection queuing practices.
This order follows up that technical conference and directs Regional
Transmission Organizations and Independent System Operators to file
reports on the status of their efforts to improve the processing of
their interconnection queues.

DATES: Reports are due April 21, 2008.

FOR FURTHER INFORMATION CONTACT:

Mary C. Morton, Federal Energy Regulatory Commission, 888 First Street,
NE., Washington, DC 20426,<PHONE_NUMBER>.
Michael G. Henry (Legal Information), Federal Energy Regulatory
Commission, 888 First Street, NE., Washington, DC 20426, (202) 502-
8532.

SUPPLEMENTARY INFORMATION:

Before Commissioners: Joseph T. Kelliher, Chairman; Suedeen G.
Kelly, Marc Spitzer, Philip D. Moeller, and Jon Wellinghoff.

Order on Technical Conference

    1. This order follows up on our December 11, 2007, technical
conference (Technical Conference) on interconnection queuing practices.
In this order, we direct the Regional Transmission Organizations (RTOs)
and Independent System Operators (ISOs) to file reports on the status
of their efforts to improve the processing of their interconnection
queues. We also provide guidance to assist the RTOs and ISOs and their
stakeholders in those efforts.

Background

    2. The Commission issued Order No. 2003 to standardize the
agreements and procedures related to the interconnection of large
generating facilities.\1\ We found that ``[a] standard set of
procedures as part of the [Open Access Transmission Tariff] for all
jurisdictional transmission facilities will minimize opportunities for
undue discrimination and expedite the development of new generation,
while protecting reliability and ensuring that rates are just and
reasonable.'' \2\ Key to balancing these goals was queue management
procedures, including timelines that Transmission Providers \3\ must
use reasonable efforts to meet.
---------------------------------------------------------------------------

    \1\ Standardization of Generator Interconnection Agreements and
Procedures, Order No. 2003, FERC Stats. & Regs. ] 31,146 (2003),
order on reh'g, Order No. 2003-A, FERC Stats. & Regs. ] 31,160,
order on reh'g, Order No. 2003-B, FERC Stats. & Regs. ] 31,171
(2004), order on reh'g, Order No. 2003-C, FERC Stats. & Regs. ]
31,190 (2005), aff'd sub nom. Nat'l Ass'n of Regulatory Util.
Comm'rs v. FERC, 475 F.3d 1277 (D.C. Cir. 2007), cert. denied, 76
U.S.L.W. 3454 (Feb. 25, 2008). See also Standardization of Small
Generator Interconnection Agreements and Procedures, Order No. 2006,
FERC Stats. & Regs. ] 31,180, order on reh'g, Order No. 2006-A, FERC
Stats. & Regs. ] 31,196 (2005), order granting clarification, Order
No. 2006-B, FERC Stats. & Regs. ] 31,221 (2006), appeal pending sub
nom. Consol. Edison Co. of N.Y., Inc. v. FERC, Nos. 06-1275 (DC Cir.
filed July 14, 2006 and later); Interconnection for Wind Energy,
Order No. 661, FERC Stats. & Regs. ] 31,186 (2005), order on reh'g,
Order No. 661-A, FERC Stats. & Regs. ] 31,198 (2005).
    \2\ Order No. 2003, FERC Stats. & Regs. ] 31,146 at P 11.
    \3\ ``Transmission Provider'' is a defined term under Order No.
2003. See Standard Large Generator Interconnection Procedures (``pro
forma LGIP'') Sec.  1.
---------------------------------------------------------------------------

    3. In response to concerns about the effectiveness of queue
management, the Commission held the Technical Conference. The
Commission also issued a notice afterward inviting comments.\4\ The
speakers at the Technical Conference and the written comments confirm
that some Transmission Providers are not processing their
interconnection queues with the timeliness envisioned in Order No.
2003, in certain cases greatly exceeding the timelines in their
tariffs. Surges in the volume of new generation development are taxing
the current queue management approach in some regions. Additionally,
the unprecedented demand in some regions for new types of generation,
principally renewable generation, places further stress on queue
management because such generation technologies can, for example, be
brought online more quickly than traditional generation. Finally, some
regions have capacity markets that did not exist when the current queue
management approach was developed and are struggling with how to manage
their queues to accommodate those new markets.
---------------------------------------------------------------------------

    \4\ Notice Inviting Comments, Interconnection Queuing Practices,
Docket Nos. AD08-2-000, et al. (Dec. 17, 2007).
---------------------------------------------------------------------------

Discussion

    4. The Commission is concerned about delays in processing
interconnection queues. Although we are concerned about delays in all
regions, the Technical Conference revealed that the delays are
particularly significant in RTOs and ISOs that are attracting
significant new entry. Many of the factors identified at the Technical
Conference as contributing to delays are present for all Transmission
Providers, independent and non-independent alike. For example, the need
for restudy when multiple projects withdraw from a queue and the
complexity of designing interconnections within a system with limited
excess transmission capacity are not confined to RTOs and ISOs. All
Transmission Providers should be evaluating whether changes are needed
to their queue management practices to ensure the expediency called for
by Order No. 2003. However, given the greater interest of new
generation entrants in gaining access to RTO and ISO markets compared
to other markets, the magnitude of the backlogs in RTO- and ISO-managed
queues is particularly significant.
    5. These backlogs not only deprive generation developers of needed
business certainty, they also undermine other important public goals.
As detailed by speakers at the Technical Conference, delays in
interconnecting renewable generation in the footprints of the Midwest
Independent Transmission System Operator, Inc. and the California
Independent System Operator Corporation are creating additional
challenges in meeting state renewable portfolio standards. In the ISO
New England Inc. and PJM Interconnection, LLC regions, queue delays
could prevent least cost resources from being available in new capacity
markets auctions.
    6. The Commission believes that over the long term, the improved
transmission planning required under Order No. 890 \5\ will address
some of the causes of the current interconnection queue problems. In
particular, the planning reforms adopted by Order No. 890 should
increase the transparency of planning information to all customers,
increase coordination among transmission owners in each region, and
otherwise result in a more robust transmission system. These
improvements, in turn, should enable developers to make fewer, more
tailored interconnection requests and make it easier to interconnect
with the transmission system. However, while the efforts currently
under way to comply with Order No. 890 hold promise for the long-term
processing of interconnection queues, we cannot afford to wait until
those efforts are completed to address the queue management problem.
---------------------------------------------------------------------------

    \5\ Preventing Undue Discrimination and Preference in
Transmission Service, Order No. 890, 72 FR 12,266 (Mar. 15, 2007),
FERC Stats. & Regs. ] 31,241 (2007), order on reh'g, Order No. 890-
A, 73 FR 2984 (Jan. 16, 2008), FERC Stats. & Regs. ] 31, 261 (2007).
---------------------------------------------------------------------------

    7. We note in particular the comments of the ISO/RTO Council on the
scope and nature of the interconnection queue problems facing ISOs and
RTOs. According to the ISO/RTO Council, the queue backlog has increased
in many of the ISOs and RTOs because of the significant new entry that
is occurring. The ISO/RTO Council states that prompt action is
necessary to address these problems; however, the Council urges that
the Commission allow each region to develop solutions that are tailored
to its specific circumstances and contends that stakeholder processes
to discuss reforms are already underway in several regions.
    8. While the Commission could take action to impose solutions, and
may need to do so if the RTOs and ISOs do not act themselves, we agree
that we should allow each region the opportunity to propose its own
solution. Although there are some common issues affecting all the
regions, there are also significant differences in the nature and scope
of the problem from region to region; there may, therefore, be no one
right answer for how to improve queue management. Further, any solution
involves a balancing of interests. Therefore, we urge the RTOs and ISOs
to work with their stakeholders to develop consensus proposals.
    9. While each of the RTOs and ISOs represented at the conference
indicated

that it was evaluating its queue management, the RTOs and ISOs and
their stakeholders must proceed more quickly, and the Commission
intends to monitor their efforts. Thus, we direct each RTO and ISO to
file a status report with the Commission within 30 days of the date of
this order.\6\ The report must describe the current size of the RTO's
or ISO's interconnection queue (i.e., number of pending interconnection
requests and total megawatts represented by those requests), the
current projected timeframes for processing pending interconnection
requests, and the nature and extent of any problems that have led to
any such queue backlogs, including a discussion of how clustering has
or has not alleviated those problems. The report must also explain the
status of stakeholder discussions on queue reform and provide a
schedule for selecting and implementing any necessary reforms,
including a target date for filing any necessary tariff amendments or
waivers. To assist stakeholders in their deliberations, we offer the
guidance set forth below.
---------------------------------------------------------------------------

    \6\ The reports will be noticed and subject to public comment.
---------------------------------------------------------------------------

    10. The reforms that can be implemented most quickly from a
regulatory standpoint are those that do not require any revisions to an
RTO's or ISO's current tariff. For example, no Commission filings are
needed to increase the staff available to work on interconnection
studies or adopt more efficient modeling for feasibility studies or
system impact studies. Similarly, each of the RTO and ISO tariffs
already provide an option for performing a single system impact study
for a cluster of interconnection requests, so no further Commission
filings would be necessary to take full advantage of the existing
flexibility to cluster. Therefore, we urge the RTOs and ISOs when
evaluating ways to improve their queue processing first to consider
whether they have taken all effective steps under their current
tariffs.
    11. While there likely are reforms that can be implemented without
the need for Commission filings, more may need to be done. Reforms
necessitating tariff changes come in two forms: (1) Reforms that apply
to future interconnection requests as well as existing interconnection
requests that are still at an early stage in the interconnection
process; and (2) reforms that affect existing interconnection requests
that are in later stages of the process. The issues raised by these two
classes of reforms may well differ.
    12. With regard to reforms applicable to future and early-stage
existing interconnection requests, we note that Order No. 2003
authorizes a number of options to streamline the interconnection
process. For example, Order No. 2003 already allows for the feasibility
study to be combined with the system impact study at the request of the
customer.\7\ Order No. 2003 permits Transmission Providers who perform
system impact studies on a clustered basis to allocate the cost of
common upgrades to members of a cluster without regard to queue
position.\8\ Further, Order No. 2003 authorizes the use of third party
consultants to conduct interconnection studies.\9\ When considering
tariff changes applicable to future and early-stage existing
interconnection requests, the RTOs and ISOs should first consider
whether their current tariffs use all of the streamlining options
already explicitly sanctioned under Order No. 2003.
---------------------------------------------------------------------------

    \7\ Pro forma LGIP Sec.  6.1.
    \8\ Id. Sec.  4.2.
    \9\ Id. Sec.  13.4.
---------------------------------------------------------------------------

    13. If an RTO or ISO concludes that the options already identified
in Order No. 2003 are inadequate to address its queue problems, it may
consider proposing variations from Order No. 2003. Because RTOs and
ISOs do not own generation and thus do not have an incentive to unduly
discriminate, variations sought by an RTO or ISO are reviewed under the
``independent entity variation standard.'' This standard allows
independent Transmission Providers flexibility in designing their
interconnection procedures to accommodate regional needs.\10\
---------------------------------------------------------------------------

    \10\ Order No. 2003 at P 822-27; Order No. 2003-A at P 759. An
RTO or ISO proposing a variation must demonstrate that the variation
is just and reasonable and not unduly discriminatory, and would
accomplish the purposes of Order No. 2003. See, e.g., PJM
Interconnection, LLC., 108 FERC ] 61,025, at P 7 (2004) (``[W]hen an
RTO is the filing entity, the Commission will review the proposed
variations to ensure that they do not provide an unwarranted
opportunity for undue discrimination or produce an interconnection
process that is unjust and unreasonable.''), order denying reh'g,
110 FERC ] 61,099 (2005); and Midwest Indep. Transmission Sys.
Operator, Inc., 117 FERC ] 61,128 (2006), order on reh'g, 119 FERC ]
61,097, at P 7 (2007) (rejecting a proposed pricing variation
because the RTO ``had not shown that the proposal would accomplish
the purposes Order No. 2003 set forth as possible justifications for
this type of pricing'').
---------------------------------------------------------------------------

    14. The Commission recognizes that the business of developing
generation is very dynamic and requires the coordination of a whole
host of factors beyond interconnection, many of which are outside the
full control of the developer. In the absence of alternative sources of
information about available transmission capacity, the interconnection-
related study process may be the only reliable vehicle a customer has
to evaluate the merits of different interconnection points and
configurations. Thus, it is critical that reforms applicable to future
and early-stage existing interconnection requests provide customers
with enough flexibility and information to respond to business
uncertainties. At the same time, the Commission realizes that the
actions of one party in the queue can affect the interests of other
parties in the queue. Thus, there needs to be a way to prioritize the
processing of requests on a fair basis and to ensure that the
flexibility for individual generators does not undermine the certainty
and speed needed for the queue as a whole.
    15. Order No. 2003 struck a balance by establishing that material
modifications to an interconnection request will result in loss of
queue position, while allowing a customer to make multiple
interconnection requests for the same basic project, if it makes a
relatively modest demonstration that it is serious about the project.
These requests are then processed and allocated costs on a first-come,
first-served basis.\11\ While this approach made good sense at the time
Order No. 2003 was issued and still works well in many situations, it
has led to some unexpected consequences, particularly in transmission
systems with numerous interconnection customers and limited excess
transmission capacity. In markets with numerous interconnection
customers, many of those customers may be competing for the same load,
and not all will be needed. Further, in systems with limited excess
transmission capacity, the first-come, first-served approach to cost
allocation can result in great disparities between the costs faced by
the customer whose request happens to trigger the need for a network
upgrade as opposed to those in lower queue positions. Moreover, the
relatively small deposit amounts, coupled with the incentives produced
by a first-come, first-served approach to allocating capacity, provides
an incentive for developers to secure a place in the queue even for
projects that may not be commercially viable. These and other factors
can result in large numbers of interconnection requests being
ultimately withdrawn, which in turn slows down the process by
necessitating more study and restudy. While the Commission is open to

considering a range of possible variations from Order No. 2003 with
regard to future and early-stage existing interconnection requests, we
believe that there are three types of variations that, individually or
in combination, hold particular promise for speeding up queue
processing while remaining faithful to the goals of Order No. 2003.
---------------------------------------------------------------------------

    \11\ As noted above, Order No. 2003 did allow for some
flexibility in the first-come, first-served approach where a
Transmission Provider performs a single system impact study for a
cluster of interconnection requests.
---------------------------------------------------------------------------

    16. First, it may be appropriate to increase the requirements for
getting and keeping a queue position. For example, it may be
appropriate to increase the amount of the deposits required at the
different stages of the process to more accurately reflect the cost of
the necessary studies. Such a change would not only be consistent with
traditional ratemaking principles, but would also increase the
likelihood that only projects that are likely to be commercially viable
(and hence willing to commit to the cost of such studies in advance)
are in the queue. Such a change also would likely reduce the number of
multiple interconnection requests made by the same customer for the
purpose of speculating on the cost impacts of different locations.
However, as discussed above, multiple requests for a single project can
result from a legitimate desire to evaluate the merits of different
interconnection points and configurations without having to go to the
back of the queue. Therefore, the more stringent the requirements, the
more important it is to ensure that customers have access to
alternative sources of reliable information about available
transmission capacity to help them tailor their interconnection
requests more narrowly toward a single acceptable interconnection
configuration. Further, the RTOs and ISOs should address the impact of
any increases in the requirements on smaller customers or any other
class of interconnection customers.
    17. Second, elimination of the feasibility study as a separate step
could reduce processing time without harming interconnection customers.
Under Order No. 2003, the feasibility study is intended, in part, to
provide preliminary information to assist developers in deciding
whether it is even worth their while to pursue more detailed
interconnection studies. Elimination of a separate feasibility study
could streamline the study process and could reduce interconnection
requests by screening out those customers who are not willing to pay
the higher deposit required for a system impact study. However,
elimination of a feasibility study phase, like increased requirements
to obtain and retain a queue position, creates a greater need to
develop alternative mechanisms through which customers can gather the
information necessary to more narrowly tailor their interconnection
requests toward a final acceptable configuration.
    18. Third, there may be approaches to prioritizing queue processing
that provide protection against discrimination comparable to the first-
come, first-served approach, but that are more efficient. For example,
there may be merit in a first-ready, first-served approach, whereby
customers who demonstrate the greatest ability to move forward with
project development are processed first. Further, the Commission is
open to considering methods of clustering other than that provided in
Order No. 2003. Order No. 2003's approach to clustering is
fundamentally based on a first-come, first-served paradigm, as clusters
are limited to requests filed within the same time frame, not to exceed
180 days.\12\ Clustering that takes into account factors other than
proximity of filing date may allow for more efficient studies and we
are open to reviewing such proposals.
---------------------------------------------------------------------------

    \12\ See pro forma LGIP Sec.  4.2. But see id. Sec.  4.1
(allowing allocation of cost of common upgrades for clustered
interconnection requests without regard to queue position).
---------------------------------------------------------------------------

    19. We note that reforms that would affect existing interconnection
requests that are in later stages of the process create special
circumstances that require careful consideration. Unlike reforms
applicable to future and early-stage existing interconnection requests,
any such reforms could significantly disrupt the activities of
customers who may have taken action in reliance upon the existing
process. Reforms of this sort could take the form of a filing to make
generic revisions to the tariff, filings to modify individual
interconnection-related agreements, or a request for a one-time waiver
of the tariff.\13\ These reforms could change both the timing and the
cost allocation for a customer. Some customers may experience an
overall benefit from a particular reform, while others may be
disadvantaged by a reform. In still other cases, perhaps the majority,
the difference between continued processing under the existing tariff
provisions and processing under a reformed process may be speculative,
including as to ultimate timing and cost allocation. In those cases, we
would expect proponents of reform to have an easier time justifying
such reform.\14\ Whether and how a particular reform should apply to a
late-stage request will depend on the specific facts. The Commission is
open to considering such reforms. Further, while such reforms do pose
more difficult issues than reforms applicable to future and early-stage
existing requests, the Commission recognizes that they may be necessary
in order to resolve current backlogs.
---------------------------------------------------------------------------

    \13\ See, e.g., Midwest Indep. Transmission Sys. Operator, Inc.,
117 FERC ] 61,128 (2006), order on reh'g, 119 FERC ] 61,097 (2007)
(rejecting as unsupported proposed tariff amendments applicable to
existing interconnection agreements but without prejudice to future
filings to revise individual interconnection agreements); and Cal.
Indep. Sys. Operator Corp., 118 FERC ] 61,226, order on
clarification, 120 FERC ] 61,180 (2007) (granting one-time waiver of
procedures for conducting clustered system impact studies despite
application to protestor who had already undergone a system impact
study).
    \14\ See, e.g., New York Indep. Sys. Operator, Inc., 114 FERC ]
61,207 (2006) (granting one-time waiver of interconnection procedure
noting that protestor's claim that it would incur higher costs due
to potential loss of its queue position was speculative).
---------------------------------------------------------------------------

    The Commission orders:
    The RTOs and ISOs are hereby directed to file reports as discussed
in the body of this order within 30 days of the date of this order.

    By the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. E8-6606 Filed 4-2-08; 8:45 am]

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[Federal Register Volume 79, Number 81 (Monday, April 28, 2014)]
[Proposed Rules]
[Pages 23300-23303]
[FR Doc No: 2014-09337]

=======================================================================
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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 77

[Docket No. FAA-2014-0134]
RIN 2120-AF90

Proposal To Consider the Impact of One Engine Inoperative
Procedures in Obstruction Evaluation Aeronautical Studies

AGENCY: Federal Aviation Administration, Department of Transportation.

ACTION: Notice of proposed policy; request for comment.

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SUMMARY: This action proposes to establish a new policy that would
consider the impact of one engine out procedures in the aeronautical
study process conducted under existing 14 CFR part 77 criteria when the
airport operations potentially affected by a determination of no hazard
are able to use a dedicated one engine out flight path. Additionally,
this proposed policy statement notes that the FAA has the authority to
consider the cumulative effects of construction in concentrated areas
when evaluating the potential for a hazard to navigation.

DATES: Send your comments on or before June 27, 2014.

ADDRESSES: You may send comments [identified by Docket Number FAA-2014-
0134] using any of the following methods:
     Government-wide rulemaking Web site: Go to http://www.regulations.gov and follow the instructions for sending your
comments electronically.
     Mail: Docket Operations, U.S. Department of
Transportation, West

Building, Ground Floor, Room W12-140, Routing Symbol M-30, 1200 New
Jersey Avenue SE., Washington, DC 20590.
     Fax: 1-202-493-2251.
     Hand Delivery: To Docket Operations, Room W12-140 on the
ground floor of the West Building, 1200 New Jersey Avenue SE.,
Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday,
except Federal holidays.
    For more information on the notice and comment process, see the
SUPPLEMENTARY INFORMATION section of this document.
    Privacy: We will post all comments we receive, without change, to
http://www.regulations.gov, including any personal information you
provide. For more information, see the Privacy Act discussion in the
SUPPLEMENTARY INFORMATION section of this document.
    Docket: To read background documents or comments received, go to
http://www.regulations.gov at any time or to Room W12-140 on the ground
floor of the West Building, 1200 New Jersey Avenue SE., Washington, DC,
between 9 a.m. and 5 p.m., Monday through Friday, except Federal
holidays.

FOR FURTHER INFORMATION CONTACT: John Speckin, Airport Obstruction
Standards Committee, Region and Center Operations, Office of Finance
and Management, Federal Aviation Administration, 800 Independence
Avenue SW., Washington, DC 20591; telephone:<PHONE_NUMBER>; email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Comments Invited

    The FAA invites interested persons to join in this notice and
comment process by filing written comments, data, or views. The most
helpful comments reference a specific portion of the proposal, explain
the reason for any recommended change, and include supporting data. We
ask that you send us two copies of written comments.
    We will file in the docket all comments we receive, as well as a
report summarizing each substantive public contact with FAA personnel
about this proposal. The docket is available for public inspection
before and after the comment closing date. If you wish to review the
docket in person, go to the address in the ADDRESSES section of this
preamble between 9 a.m. and 5 p.m., Monday through Friday, except
Federal holidays. You may also review the docket using the Internet at
the web address in the ADDRESSES section.
    Privacy Act: Using the search function of our docket Web site,
anyone can find and read the comments received into any of our dockets.
This includes the name of the individual sending the comment (or
signing the comment for an association, business, labor union). You may
review DOT's complete Privacy Act Statement in the Federal Register
published on April 11, 2000 (65 FR 19477-78) or you may visit http://regulations.gov.
    Before acting on this proposal, we will consider all comments we
receive on or before the closing date for comments. We will consider
comments filed late if it is possible to do so without incurring
expense or delay. We may change this proposal because of the comments
we receive.
    If you want the FAA to acknowledge receipt of your comments on this
proposal, include with your comments a preaddressed, stamped postcard
on which the docket number appears. We will stamp the date on the
postcard and mail it to you.

Proprietary or Confidential Business Information

    Do not file in the docket information that you consider to be
proprietary or confidential business information. Send or deliver this
information directly to the person identified in the FOR FURTHER
INFORMATION CONTACT section of this document. You must mark the
information that you consider proprietary or confidential. If you send
the information on a disk or CD-ROM, mark the outside of the disk or
CD-ROM and also identify electronically within the disk or CD-ROM the
specific information that is proprietary or confidential.
    Under 14 CFR 11.35(b), when we are aware of proprietary information
filed with a comment, we do not place it in the docket. We hold it in a
separate file to which the public does not have access and place a note
in the docket that we have received it. If we receive a request to
examine or copy this information, we treat it as any other request
under the Freedom of Information Act (5 U.S.C. 552). We process such a
request under the DOT procedures found in 49 CFR Part 7.

Availability of Documents

    You can get an electronic copy using the Internet by:
    (1) Searching the Federal eRulemaking portal (http://www.regulations.gov/search);
    (2) Visiting the FAA's Regulations and Policies Web page at http://www.faa.gov/regulations_policies; or
    (3) Accessing the Government Printing Office's Web page at http://www.access.gpo.gov/su_docs/aces/aces140.html.

Authority for This Proceeding

    Under Section 40103(a), the Administrator has broad authority to
regulate the safe and efficient use of the navigable airspace. The
Administrator is also authorized to issue air traffic rules and
regulations to govern the flight, navigation, protection, and
identification of aircraft for the protections of persons and property
on the ground and for the efficient use of the navigable airspace (49
U.S.C. 40103(b)). The Administrator may also conduct investigations and
prescribe regulations, standards, and procedures in carrying out the
authority under this part (49 U.S.C. 40113). The Administrator is
authorized to protect civil aircraft in air commerce (49 U.S.C.
44701(a)(5)).
    Under Section 44701(a)(5), the Administrator promotes safe flight
of civil aircraft in air commerce by prescribing regulations and
minimum standards for other practices, methods, and procedures
necessary for safety in air commerce and national security. Also,
Section 44718 provides that under regulations issued by the
Administrator, notice to the agency is required for any construction,
alteration, establishment, or expansion of a structure or sanitary
landfill, when notice will promote safety in air commerce and the
efficient use and preservation of the navigable airspace and airport
traffic capacity at public use airports. This statutory provision also
provides that, under regulations issued by the Administrator, the
agency determines whether such construction or alteration is an
obstruction of the navigable airspace, or an interference with air
navigation facilities and equipment or the navigable airspace. If a
determination is made that the construction or alteration creates an
obstruction or otherwise interferes, the agency then conducts an
aeronautical study. The study evaluates the adverse impacts on the safe
and efficient use of the airspace, facilities or equipment, as well as
the cumulative impact resulting from the proposed construction or
alteration of a structure when combined with the impact of other
existing or proposed structures.

Proposed Policy Statement

    Navigable airspace is being encroached around the country with the
net effect of decreasing access for aviation operations. Structures as
diverse as microwave towers to office buildings and wind turbines are
being built in ever-increasing numbers near many airports. While
developers may

erect these structures, the FAA must consider the impact of the
structures on the safe operation of flight and their impact on the
safe, efficient use and preservation of the navigable airspace and
airport capacity and efficiency. Additionally, aircraft operators must
plan for the potential of an engine failure (one engine inoperative, or
OEI) during take-off in accordance with 14 CFR parts 25, 121, and 135.
An engine failure could prevent the aircraft from climbing at the
normal climb rate and structures near an airport could, under such
circumstances, create a safety risk. Thus, the agency interest in
studying the potential impact of these structures is not limited solely
to whether aircraft could avoid the proposed structures under normal
circumstances. The agency should also consider the impact of OEI.
    The potential impact of a structure is particularly significant at
airports where existing development or other factors effectively limit
operator options in an OEI situation. At these airports, increasing
encroachment of the airspace may effectively reduce the amount of
usable runway because of OEI procedures.\1\
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    \1\ Indeed, the increased concentration of structures could
significantly impact the ability of the FAA to mitigate the risk to
safety and capacity for any reason. Title 49 U.S.C. 44718
specifically requires the FAA to consider the cumulative impact
resulting from the proposed construction or alteration of a
structure when combined with the impact of other existing or
proposed structures.
---------------------------------------------------------------------------

    The FAA is tasked with multiple mandates. Assuring aviation safety
is the FAA's primary mission, including safety of navigable airspace,
aircraft safety and airport safety, and responsibility for assuring
that safety is shared by the agency's air traffic organization and
aviation safety organization. Additionally, the Office of Airports is
tasked with assuring the safety and the continued viability of public
airports, and with maintaining and expanding aviation capacity at those
airports. To that end, the FAA routinely supports significant
investments at these airports to increase airport capacity and
efficiency through the approval of new runways and extension of
existing runways. This proposed policy statement addresses the
different mandates of the FAA, while recognizing the right of
developers to erect structures near airports and air navigation
facilities.
    The FAA is not authorized to grant or deny construction projects.
Rather, Part 77 defines a number of obstruction standards that are used
to identify obstacles that may have an adverse impact on the navigable
airspace. Even upon the issuance of a Determination of Hazard, the
developer is free to continue construction. However, zoning authorities
and private insurers may be reluctant to permit construction of the
structure, given the FAA's determination that it poses a hazard to
navigation. Should the developer proceed with construction, the FAA,
through its air traffic organization, takes action to mitigate the
impact of the obstruction by altering procedures (e.g., departure
routes, climb gradients) to ensure that safety is maintained. In making
a hazard determination under part 77, the FAA has historically only
considered aircraft operations under normal circumstances. OEI
procedures have been considered emergency procedures and have not been
considered by the FAA when conducting an aeronautical study under Part
77.
    As long as the aircraft could operate with altered flight tracks,
the FAA has not considered other potentially costly impacts to the
carriers. These include, for example, greater fuel burn, reduced
payload, or reduced numbers of passengers. As a result, aviation
flexibility may be compromised, and the carriers have noted they are
experiencing a growing erosion of capacity because of the encroachment
from obstructions near airports. To keep up with this situation, the
FAA is now planning to evaluate a broader definition of capacity when
evaluating new obstacles in a defined OEI departure area with the
intent to preserve the usable runway length at federally obligated
airports.
    The responsibility to consider all obstructions beyond the runway
end and make the necessary adjustments to OEI departure procedures
falls upon the aircraft operator to ensure safe clearance. Every air
carrier takeoff operation must plan for an engine failure. OEI
procedures may force an operator to reduce the takeoff weight of the
aircraft, either by reducing the number of passengers or the amount of
cargo or fuel when circumstances mandate.
    Historically, the FAA has held that this is an economic issue
rather than a capacity issue largely based on the premise that airports
are not incurring serious encroachment from multiple obstructions near
the airport. However, the last forty years have shown economic activity
and structures only accelerating around airports--creating an ever
increasing risk. To address this, the FAA is planning to integrate the
OEI requirements within its Part 77 analysis.
    Air carriers believe that the FAA should include OEI requirements
in its Part 77 determinations to help ensure an unobstructed departure
path in the event of an emergency engine-out situation. Simply
accommodating the multiple OEI procedures of all operators at an
airport is not possible. The OEI procedures could be so diverse as to
effectively create a zone around the entire airport where hazard
determinations would be made at a height and distance that the FAA has
consistently determined no hazard exists. Another solution is merited.
    In May of 2008, the FAA initiated and sponsored the National OEI
Pilot Project to develop OEI surface policy guidance. It engaged the
airport owners/sponsors in developing an OEI surface and depicting it
on the Airport Layout Plan (ALP). The OEI Pilot Project utilized the
specific knowledge, expertise, and operational experience of airport
management, local government/community, and air carriers to develop
policy guidance for OEI surfaces that would satisfy the needs of the
majority of airports and air carriers.
    Based on this pilot program, the FAA has determined that it is
desirable for airport owners, with input from users/operators and
communities, to define an OEI departure area for each runway end
supporting commercial service operations in coordination with the FAA.
Developing OEI surfaces is a voluntary decision the airport owner makes
in coordination with the FAA, with input from the users/operators and
local community. Once the surface is defined for each critical runway
end and agreed to by all stakeholders, it is the intention of the FAA
to consider a consolidated OEI surface(s) and the effects of new
structures encroaching them under its existing Part 77 authority.
    Consideration of the dedicated OEI surfaces would extend to the
full scope of existing Part 77 requirements. The FAA does not need to
amend Part 77 to implement this change. Accordingly, while the FAA is
willing to consider the impact of the proposed structure, it would not
require notification of structures solely for the purpose to study for
possible impact to an OEI surface. If a structure does not require
filing under Part 77 or does not exceed an obstruction standard under
Sec.  77.17, then it will not be studied for possible impact to an OEI
surface. While aircraft operators can choose to develop an OEI
procedure that is outside of the areas covered by Part 77 notice
criteria, the FAA would not consider those procedures when evaluating
the potential impact of the proposed structure on the safety and
capacity of the navigable airspace or airport.

    Under this proposed policy, if notice of a proposed structure is
filed with the FAA and the structure would exceed an obstruction
standard, the structure would be a hazard to air navigation if it
exceed the OEI surface for that runway and it was not shielded in
accordance with paragraph 6-3-13 of FAA Order 7400.2,\2\ Procedures for
Handling Airspace Matters. The FAA invites comment on whether
additional exceptions are warranted to this finding of a hazard
determination for these obstructions.
---------------------------------------------------------------------------

    \2\ Existing structures within the OEI surface would be
grandfathered and not subject to this proposed policy; however, this
proposal would apply to modifications to such structures.
---------------------------------------------------------------------------

    The FAA believes any airport and experiencing encroachment should
work with its users during the Master Planning process and propose to
depict a dedicated OEI surface on the Airport Layout Plan (ALP). If
this results in a large number of pending proposals, then the FAA will
give top priority to those submitted by the core airports. Core
airports are those with more than 1% of total enplanements, defined as
large hubs, or airports with 0.75% or more of total non-military
itinerant operations. These core airports are the most likely to have a
near-term need to define OEI departure areas. FAA will then process
requests from non-core airports on a first come, first served basis,
consistent with available FAA resources. FAA approval of proposed
changes to the ALP will require consideration of potential
environmental impacts under the National Environmental Policy Act
(NEPA). As part of the NEPA review, the FAA will identify and
appropriately address any disproportionately high and adverse impacts
on minority and low income populations in accordance with the Executive
Order on Environmental Justice.
    The FAA intends to amend agency guidance and directives to
encourage airports to collaborate with stakeholders to proactively
identify OEI departure tracks and consider potential impacts of land
use development upon airport capacity. The FAA is seeking input on the
negative or positive impact from all parties that could result from
this policy change, including developers, airport owners, aircraft
operators, local governments, and any other group that feels they will
be impacted.

    Issued in Washington, DC, on April 21, 2014.
Raymond Towles,
Deputy Assistant Administrator for Regions and Center Operations,
Office of Finance and Management, Federal Aviation Administration.
[FR Doc. 2014-09337 Filed 4-24-14; 4:15 pm]
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