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9-4-90 
Vol. 55 


No. 171 



Tuesday 

September 4, 1990 



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Government 
Printing Office 

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OF DOCUMENTS 
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0-4-90 

Vol. 55 No. 171 
Pages 35855-36256 



Tuesday 

September 4, 1990 


Briefings on How To Use the Federal Register 

For information on briefings In Washington. DC and 

Dallas, TX, see announcement on the inside cover of this 

issue. 





























I! 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 



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For other telephone numbers, see the Reader Aids section 
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Contents 


Federal Register 
Vol. 55. No. 171 
Tuesday. September 4 . 1990 



Agency for Toxic Substances and Disease Registry 
notices 

Hazardous substances releases and facilities; health 
assessments and effects; quarterly listing. 35956 

Agricultural Marketing Service 

RULES 

Celery grown in Florida, 35893 

Lemons grown in California and Arizona, 35889 

Milk marketing orders: 

Eastern South Dakota, 35894 
Olives grown in California, and imported, 35891 
Tobacco inspection; 

Growers' referendum results, 35885 
(2 documents) 

Agriculture Department 

See also Agricultural Marketing Service; Farmers Home 
Administration; Federal Crop Insurance Corporation; 
Federal Grain Inspection Service 
notices 

Grant and cooperative agreement awards: 

Save the Children Foundation, 35911 
(2 documents) 

Tuskegee University, 35911 

Antitrust Division 
notices 

Competitive impact statements and proposed consent 
judgments: 

Brown & Root, Inc., et aL, 35963 

Army Department 
rules 

Environmental quality: 

Army actions, environmental effects; civilian and military 
personnel, realignments and reductions, 35904 
NOTICES 

Patent licenses, exclusive: 

Schodowsky, S.S., 35934 

Bicentennial of the United States Constitution 
Commission 

See Commission on the Bicentennial of the United States 
Constitution 

Centers for Disease Control 
NOTICES 

Agricultural lung disease research program; NiOSH 
meeting. 35957 

Coast Gua’-d 

RULES 

Pollution: 

Hazardous materials, bulk liquid; waterfront faeibties and 
vessels pollution prevention requirements, 36248 
MARPOL 73/78 Annex V; pollution prevention 
requirements implementation, 35988 
PROPOSED RULES 

Vessels; industry standards; incorporation and adoption 
Correction. 35983 


Commerce Department 

See also Export Administration Bureau; Foreign-Trade 
Zones Board; International Trade A dm i nistrat ion; 
National Oceanic and Atmospheric Administration 
NOTICES 

Agency information collection activities under OMB review, 
35913, 35914 
(2 documents) 

Commission on the Bicentennial of the United States 
Constitution 

NOTICES 

Grants and cooperative agreements; availability, etc.: 
Constitution bicentennial educational program, 35924 

Commodity Futures Trading Commission 
RULES 

Organization, functions, and authority delegations: 

Director, Economic Analysis Division, et a!., 35897 
NOTICES 

National Futures Association; authorization to allow direct 
electronic entry of registration data into NFA computer 
system; pilot program, 35925 

Defense Department 

See Army Department; Navy Department; Uniformed 
Services University of the Health Sciences 

Education Department 
NOTICES 

Agency information collection activities under OMB review. 
35935 

Energy Department 

See also Federal Energy Regulatory Commission; Hearings 
and Appeals Office, Energy Department 
NOTICES 

Grant and cooperative agreement awards: 

Bode. Robert E.. 35936 

National Academy of Sciences, 35936 

University of Missouri-Rolla, 35936 

Environmental Protection Agency 
NOTICES 

Meetings: 

FIFRA Scientific Advisory Panel, 35955 
Science Advisory Board, 35954 
Toxic and hazardous substances control: 

Confidential business information and data transfer to 
contractors, 35955 

Export Administration Bureau 
RULES 

Export licensing: 

Sweden; import certificatc/delivery verification procedure 
establishment, 35896 










IV 


Federal Register / Vol. 55, No. 171 / Tuesday. September 4. 1990 / Contents 


Farmers Home Administration 

RULES 

Program regulations: 

Rural housing— 

Rental housing appraisals; loan policies, procedures, 
and authorizations, 35895 
PROPOSED RULES 
Program regulations: 

Real property— 

Multiple family housing loans; security servicing, 35907 

Federal Communications Commission 

RULES 

Radio stations; table of assignments: 

Kentucky, 35905 
Texas, 35905 
PROPOSED RULES 
Practice and procedure: 

Comparative hearing process for new applicants, 35909 
Radio stations; table of assignments: 

West Virginia. 35909 
Wisconsin, 35910 

Federal Crop Insurance Corporation 

RULES 

Crop insurance; various commodities: 

Apples et a!., 35887 
Arizona-Califomia citrus. 35888 
Potatoes. 35888 

Federal Deposit Insurance Corporation 

NOTICES 

Meetings; Sunshine Act, 35981 

Federal Energy Regulatory Commission 

NOTICES 

Electric rate, small power production, and interlocking 
directorate filings, etc.: 

Western Massachusetts Electric Co. et al., 35937 
Hydroelectric applications, 35937 
Natural gas certificate filings: 

Northwest Pipeline Corp. et al., 35945 
Applications, hearings, determinations, etc,: 

CNG Transmission Corp., 35949 
Mid Louisiana Gas Co., 35949 
Northwest Pipeline Corp., 35949 
Paiute Pipeline Co., 35950 
United Gas Pipe Line Co., 35950 

'ederal Grain Inspection Service 

NOTICES 

Agency designation actions: 

Alabama, 35912 
Illinois et al., 35912 
Iowa, 35913 
Iowa et al., 35911 
Iowa et al.; correction. 35913 
Meetings: 

Advisory Committee, 35913 

Federal Highway Administration 

RULES 

Payment procedures: 

Construction engineering costs; reimbursement, 35903 


Federal Maritime Commission 
RULES 

Passenger vessels: 

Security for protection of public; maximum required 
performance amount 
Correction, 35983 

Fish and Wildlife Service 

RULES 

Hunting: 

Refuge-specific hunting regulations; correction, 35906 

NOTICES 

Environmental statements; availability, etc.: 

National Wildlife Refuge System; management, 35962 

Food and Drug Administration 

NOTICES 

Organization, functions, and authority delegations, 35957 

Foreign-Trade Zones Board 

NOTICES 

Applications, hearings, determinations, etc.: 

Arizona— 

Conair Corp.; warehousing/manufacturing facilities, 

35914 
Louisiana— 

AT&T telephone and computer equipment plant, 35915 
North American Shipbuilding, Inc.; shipyard facilities, 

35915 

Wisconsin, 35916 

Health and Human Services Department 

See Agency for Toxic Substances and Disease Registry; 
Centers for Disease Control; Food and Drug 
Administration; Health Care Financing Administration; 
National Institutes of Health; Public Health Service 

Health Care Financing Administration 
RULES 

Medicare: 

Inpatient hospital prospective payment system and fiscal 
year 1991 rates, 35990 
NOTICES 
Privacy Act: 

Systems of records, 35957 
Medicare: 

Physicians’ services; model fee schedule. 36178 

Health Resources and Services Administration 

See Public Health Service 

Hearings and Appeals Office, Energy Department 

NOTICES 

Special refund procedures; implementation, 35950 

Interior Department 

See Fish and Wildlife Service; Land Management Bureau 

International Boundary and Water Commission, United 
States and Mexico 

RULES 

Freedom of Information Act; implementation: 

Uniform fee schedule and administrative guidelines, 35898 

International Trade Administration 

NOTICES 

Antidumping: 

Television receivers, monochrome and color, from Japan, 
35916 







Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Contents 


V 


Countervailing duties: 

Cotton shop towels from Peru, 35921 
Fresh cut flowers from Ecuador, 35922 

Interstate Commerce Commission 
NOTICES 

Meetings; Sunshine Act, 35981 
Rail carriers: 

Direct service orders— 

D&H Corp. et al.. 35962 

Railroad operation, acquisition, construction, etc.: 

Columbus & Greenville Railway Co., 35963 

Justice Department 

See Antitrust Division 

Land Management Bureau 

NOTICES 

Meetings: 

Shoshone District Advisory Council, 35961 
Realty actions; sales, leases, etc.: 

California; correction, 35983 
Withdrawal and reservation of lands: 

Colorado; correction, 35983 
Wyoming; correction, 35983 

Mexico and United States, International Boundary and 
Water Commission 

See International Boundary and Water Commission, United 
States and Mexico 

national Archives and Records Administration 

NOTICES 

Agency records schedules; availability, 359G9 

National Institute for Occupational Safety and Health 

See Centers for Disease Control 

National Institutes of Health 

NOTICES 

Meetings: 

National Cancer Institute. 35960 

National Oceanic and Atmospheric Administration 
NOTICES 

Coastal zone management programs and estuarine 
sanctuaries: 

State programs— 

Evaluation findings availability, 35922 
Intent to evaluate performance. 35923 
Permits: 

Marine mammals, 35923, 35924 
(2 documents) 

Marine mammals; correction, 35924 

National Science Foundation 

NOTICES 

Antarctic Conservation Act of 1978: permit applications, 
etc., 35970, 35971 
(2 documents) 

Navy Department 
NOTICES 

Environmental statements; availability, etc.: 

Base realignments and closures— 

Naval Ordnance Station Louisville, KY, 35934 


Nuclear Regulatory Commission 
NOTICES 

Applications , hearings, determinations, etc.: 

Carolina Power & Light Co., 35971 
Philadelphia Electric Co., 35974 

Nuclear Waste Technical Review Board 
NOTICES 

Meetings, 35975 

Personnel Management Office 

NOTICES 

Meetings: 

Federal Prevailing Rate Advisory Committee. 35977 

Public Health Service 

See also Agency for Toxic Substances and Disease 

Registry: Centers for Disease Control; Food and Drug 
Administration; National Institutes of Health 

NOTICES 

Committees; establishment renewal, termination, etc.: 

National Vaccine Advisory Committee. 35961 
National toxicology program: 

Toxicology and carcinogenesis studies— 

Coconut oil fatty acids diethanolamine, etc., 35961 

Resolution Trust Corporation 
NOTICES 

Meetings; Sunshine Act, 35981 

Small Business Administration 
PROPOSED RULES 

Small business size standards: 

Nonmanufacturer rule waivers— 

Petroleum products (nine classes), 35908 

State Department 

NOTICES 

Metric system implementation policy; availability. 35977 

Thrift Supervision Office 

NOTICES 

Conservator appointments: 

Ambassador Federal Savings & Loan Association, 35978 
Broken Arrow Savings Association, F.A., 35979 
First Savings & Loan Association, F.A., 35979 
Receiver appointments: 

Ambassador Savings & Loan Association, 35979 
Broken Arrow Federal Savings & Loan Association, 35979 
Chillicothe Federal Savings & Loan Association, 35979 
First Federal Savings & Loan Association. 35979 
Heritage Savings Association, F.A., 35979 
Investment Federal Savings & Loan Association, 35979 
Jefferson Savings & Loan Association, 35980 
Lakeland Savings Bank, F.S.B., 35980 
Westwood Savings & Loan Association, 35980 

Transportation Department 

See also Coast Guard; Federal Highway Administration; 
Urban Mass Transportation Administration 

NOTICES 

Aviation proceedings: 

Agreements filed; weekly receipts, 35977 
Certificates of public convenience and necessity and 

foreign air carrier permits; weekly applications. 35978 

Treasury Department 

See Thrift Supervision Office 








VI 


Federal Register / Voi 55. No. 171 / Tuesday, September 4, 1990 / Contents 


Uniformed Services University of the Health Sciences 
NOTICES 

Meetings; Sunshine Act 35981 

Urban Mass Transportation Administration 
NOTICES 

Grants; UMTA sections 3 and 9 obligations. 35978 


Separate Parts In This Issue 
Part II 

Department of Transportation. Coast Guard, 35986 

Part III 

Department of Health and Human Services. Health Care 
Financing Administratioa 35990 

Part IV 

Department of Health and Human Services, Health Care 
Financing Administration. 36178 

Part V 

Department of Transportation. Coast Guard., 36248 


Reader Aids 

Additional information, including a list of public 
laws, telephone numbers, and finding aids, appears 
in the Reader Aids section at the end of this issue. 


















Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Contents 


VII 


CFR PARTS AFFECTED IN THIS ISSUE 


A cumulative list of the parts al 

the Reader Aids section at the 

7 CFR 


29 (2 documents). 

.35885 

403. 


405. 

.35886 

406. 

.35886 

409 (2 documents)... 

.35886, 


35888 

416. 

.35886 

422 (2 documents)... 

.35886, 


35888 

425. 


430. 

.35886 

435. 

.35886 

437. 

.35886 

441. 


443. 

.35886 

445. 

.35886 

446. 

.35886 

447. 

.35886 

450. 

.35886 

451. 

.35886 

454. 

.35886 

455. 

.35886 

456. 

.35886 

910. 

.35889 

932. 


944. 


967. 

.35893 

1076. 


1922. 

.35895 

1930. 


1944. 

.35895 

Proposed Rules: 


1965. 

.35907 

13 CFR 


Proposed Rules: 


121. 

.35908 

15 CFR 


775. 

.35896 

17 CFR 


140. 

.35897 

22 CFR 


1102. 

.35898 

23 CFR 


140. 

.35903 

32 CFR 


651. 

.35904 

33 CFR 


126. 

.36248 

151. 


154. 


155 (2 documents).... 

.35986, 


36248 

156. 


158. 


Proposed Rules: 


127. 

.35983 

154. 

.35983 

42 CFR 


412. 


413. 

.35990 

46 CFR 


25. 

.35986 

540. 


Proposed Rules: 


25. 

.35983 

32. 

.35983 

34. 

..35983 

50. 

.35983 

52. 

... 35983 

53. 

.35983 

54 

.35983 

55... 

.35983 


30. 

57.... 

.35983 

58. 


59.... 

.35983 

71. 

.35983 

76. 

.35983 

91. 

.35983 

92. 

.35983 

95. 

.35983 

107. 

.35983 

103. 

.35983 

150. 

.35983 

153. 

.35983 

162.. 

.35983 

163. 

.35983 

169. 

.35983 

170. . 

.35983 

174... 

.35983 

182. 

.35983 

189. 

.35983 

190. 

.35983 

193. 

.35983 


47 CFR 

73 (2 documents).. 
Proposed Rules: 

1 . 

73 (2 documents).. 

50 CFR 

32. 


.35905 


.. 35909 
.35909, 
35910 

.. 35906 

















































































































































































Rules and Regulations 


Federal Register 

Vol. 55. No. 171 

Tuesday, September 4. 1990 


35885 


This section of the FEDERAL REGISTER 
contains regulatory documents having 
general applicability and legal effect, most 
of which are keyed to and codified in 
the Code of Federal Regulations, which is 
published under 50 titles pursuant to 44 
U.S.C. 1510. 

The Code of Federal Regulations is sold 
by the Superintendent of Documents. 

Prices of new books are listed in the 
first FEDERAL REGISTER issue of each 
week. 


DEPARTMENT OF AGRICULTURE 
Agricultural Marketing Service 
7 CFR Part 29 
[TB-89-Q17] 

Tobacco Inspection; Growers’ 
Referendum Results 

agency: Agricultural Marketing Service, 
USDA. 

ACTION: Final rule. 

summary: This document contains the 
determination with respect to the 
referendum on the designation of 
Metter. Georgia, as a tobacco auction 
market. A mail referendum was 
conducted during the period of June 4-6, 
1990, among active tobacco growers 
residing in the counties of Candler, 
Bulloch, Evans, Tattnall, Toombs, and 
Emanuel, Georgia, to determine 
producer approval of the designation of 
Metter as a new market. Eligible 
producers voted in favor of the 
designation. Therefore, for the 1990 and 
succeeding flue-cured marketing 
seasons, Metter, Georgia, shall be 
designated as a tobacco auction market. 
The regulations are amended to reflect 
this new designated market. 

EFFECTIVE date: October 4.1990. 

FOR FURTHER INFORMATION CONTACT: 
Ernest L. Price, Director, Tobacco 
Division, Agricultural Marketing 
Service, United States Department of 
Agriculture, P.O. Box 96450, room 502 
Annex, Washington, DC 20090-6456, 
telephone (202) 447-4101. 
SUPPLEMENTARY INFORMATION: A notice 
was published in the May 29,1990, issue 
of the Federal Register advising that a 
referendum would be conducted among 
active flue-cured producers who reside 
in the counties of Candler, Bulloch, 
Evans, Tattnall. Toombs, and Emanuel, 
Georgia, to ascertain if such producers 
favored the designation of Metter. 


The notice of referendum announced 
the determination by the Secretary that 
Metter, Georgia, would be designated as 
a flue-cured tobacco auction market and 
receive mandatory. Federal grading of 
tobacco sold at auction for the 1990 and 
succeeding seasons, subject to the 
results of the referendum. The 
determination was based on the 
evidence and arguments presented at a 
public hearing held in Metter, Georgia, 
on November 3,1989, pursuant to 
applicable provisions of the regulations 
issued under the Tobacco Inspection 
Act. as amended. The referendum was 
held in accordance with the provisions 
of the Tobacco Inspection Act as 
amended (7 U.S.C. 511d) and the 
regulations set forth in 7 CFR 29.74. 

Ballots for the June 4-8 referendum 
were mailed to 367 producers. Approval 
required votes in favor of the proposal 
by two-thirds of the eligible voters who 
cast valid ballots. The Department 
received a total of 82 responses: 61 
eligible producers voted in favor of the 
designation of Metier, 14 eligible 
producers voted against the designation, 
and 7 ballots were determined to be 
invalid. 

This rule has been reviewed under 
USDA procedures established to 
implement Executive Order 12291 and 
Departmental Regulation 1512-1 and has 
been determined to be a "nonmajor” 
rule because it does not meet any of the 
criteria established for major rules 
under the executive order. 

Additionally, in conformance with the 
provisions of Public Law 96-354, the 
Regulatory Flexibility Act. full 
consideration has been given to the 
potential economic impact upon small 
business. Most of the firms which would 
be affected by this rule are small 
businesses. Small agricultural producers 
have been defined by the Small 
Business Administration (13 CFR 121.2) 
as those having gross annual revenues 
for the last three years of less than 
$500,000, and small agricultural service 
firms are defined as those whose gross 
annual receipts are less than $3,500,000. 
The Administrator, Agricultural 
Marketing Service, has determined that 
this action will not have a significant 
economic impact on a substantial 
number of small entities. This rule will 
not substantially affect the normal 
movement of the commodity in the 
marketplace. Compliance with this rule 
will not impose substantial direct 


economic cost, recordkeeping, or 
personnel workload changes on small 
entities, and will not alter the market 
share of competitive positions of small 
entities relative to the large entities and 
will in no way affect normal competition 
in the marketplace. 

List of Subjects in 7 CFR Part 29 

Administrative practice and 
procedure, Advisory committees, 
Government publications. Imporls, 
Pesticides and pests. Reporting and 
recordkeeping requirements, Tobacco. 

For the reasons set forth in the 
preamble, 7 CFR part 29. subpart D, is 
amended as follows: 

Subpart D—Order of Designation of 
Tobacco Markets. 

1. The authority citation for 7 CFR 
part 29, eubpart D, continues to read as 
follows: 

Authority: Sec. 5. 49 Stat. 732, as amended 
by sec. 157(a)(1). 95 Stat. 374 (7 U.S.C. 511d). 

§29.6001 (Amended] 

2. In S 29.6001, the table is amended 
by removing under item (q) in the 
column Auction Markets the word 
Metter. Georgia, and adding a new entry 
(eee) to read as follows: 


Territory 

Types 

of 

tobac¬ 

cos 

Auction 

markets 

Order of 

designa- Citation 
toon 

(eee) 

# 

Flue- 

• 

Metter...... 

• • 

--- Septem¬ 

Geor¬ 

Cured. 


ber 4 , 

gia. 



1990. 


Dated: August 29,1990. 

Kenneth C. Clayton, 

Acting Administrator. 

[FR Doc. 90-20743 Filed 8-31-90; 8:45 am) 
B1LLINQ CODE 34UM)3-N 


7 CFR Part 29 
ITB-89-0161 

Tobacco Inspection; Growers’ 
Referendum Results 

agency: Agricultural Marketing Service, 
USDA. 

action: Final rule. 

summary: This document contains the 
determination with respect to the 



















35886 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


referendum on the designation of 
Fitzgerald, Georgia, as a tobacco auction 
market. A mail referendum was 
conducted during the period of June 4-5. 
1990. among active tobacco growers 
residing in the counties of Ben Hill, 
Coffee, Irwin, Turner, Wilcox, and 
Telfair, Georgia, to determine producer 
approval of the designation of Fitzgerald 
as a new market. Eligible producers 
voted in favor of the designation. 
Therefore, for the 1990 and succeeding 
flue-cured marketing seasons, 

Fitzgerald, Georgia, shall be designated 
as a tobacco auction market. The 
regulations are amended to reflect this 
new designated market. 

EFFECTIVE DATE: October 4,1990. 

FOR FURTHER INFORMATION CONTACT: 
Ernest L. Price, Director, Tobacco 
Division, Agricultural Marketing 
Service, United States Department of 
Agriculture, P.O. Box 96456, room 502 
Annex, Washington, DC 20090-6456, 
telephone (202) 447-4101. 
SUPPLEMENTARY INFORMATION: A notice 
was published in the May 29,1990, issue 
of the Federal Register advising that a 
referendum would be conducted among 
active flue-cured producers who reside 
in the counties of Ben Hill, Coffee, Irwin, 
Turner. Wilcox, and Telfair, Georgia, to 
ascertain if such producers favored the 
designation of Fitzgerald. 

The notice of referendum announced 
the determination by the Secretary that 
Fitzgerald. Georgia, would be 
designated as a flue-cured tobacco 
auction market and receive mandatory. 
Federal grading of tobacco sold at 
auction for the 1990 and succeeding 
seasons, subject to the results of the 
referendum. The determination was 
based on the evidence and arguments 
presented at the public hearing held in 
Fitzgerald, Georgia, on November 2, 

1989, pursuant to applicable provisions 
of the regulations issued under the 
Tobacco Inspection Act, as amended. 
The referendum was held in accordance 
with the provisions of the Tobacco 
Inspection Act, as amended (7 U.S.C. 
511d) and the regulations set forth in 7 
CFR 29.74. 

Ballots for the June 4-8 referendum 
w r ere mailed to 462 producers. Approval 
required votes in favor of the proposal 
by two-thirds of the eligible voters who 
cast valid ballots. The Department 
received a total of 116 responses: 89 
eligible producers voted in favor of the 
designation of Fitzgerald; 18 eligible 
producers voted against the designation, 
and 9 ballots were determined to be 
invalid. 

This rule has been reviewed under 
USDA procedures established to 
implement Executive Order 12291 and 


Departmental Regulation 1512-1 and has 
been determined to be a "nonmajor" 
rule because it does not meet any of the 
criteria established for major rules 
under the executive order. 

Additionally, in conformance with the 
provisions of Public Law 96-354, the 
Regulatory Flexibility Act, full 
consideration has been given to the 
potential economic impact upon small 
business. Most of the Firms which would 
be affected by this rule are small 
businesses. Small agricultural producers 
have been defined by the Small 
Business Administration (13 CFR 121.2) 
as those having gross annual revenues 
for the last three years of less than 
$500,000, and small agricultural service 
Firms are defined as those whose gross 
annual receipts are less than $3,500,000. 
The Administrator, Agricultural 
Marketing Service, has determined that 
this action will not have a significant 
economic impact on a substantial 
number of small entities. This rule will 
not substantially affect the normal 
movement of the commodity in the 
marketplace. Compliance with this rule 
will not impose substantial direct 
economic cost, recordkeeping, or 
personnel workload changes on small 
entities, and will not alter the market 
share of competitive positions of small 
entities relative to the large entities and 
will in no way affect normal competition 
in the marketplace. 

List of Subjects in 7 CFR Part 29 

Administrative practice and 
procedure, Advisory committees. 
Government publications, Imports, 
Pesticides and pests, Reporting and 
recordkeeping requirements, Tobacco. 

For the reasons set forth in the 
preamble, 7 CFR part 29, subpart D, is 
amended as follows: 

Subpart D—Order of Designation of 
Tobacco Markets. 

1. The authority citation for 7 CFR 
part 29, subpart D. continues to read as 
follows: 

Authority: Sec. 5, 49 Stat. 732, as amended 
by sec. 157(a)(1). 95 Stat. 374 (7 U.S.C. 511d). 

§ 29.8001 [Amended] 

2. In S 29.8001, the table if amended by 
removing under item (x) in the column 
Auction Markets the word Fitzgerald, 
Georgia, and adding a new entry (ddd) 
to read as follows: 


Territory 

Types 

of 

tobac¬ 

cos 

Auction 

markets 

Order of 

designa- Citation 
Uon 


• 

• 

• • 

(ddd) 

Rue- 

Fitzger¬ 

.. Septem¬ 

Geor¬ 

Cured. 

ald. 

ber 4. 

gia. 



1990. 


Dated: August 29.1990. 

Kenneth C. Clayton, 

Acting Administrator. 

[FR Doc. 90-20740 Filed 8-3-90; 8:45 am] 

BILLING CODE 3410-02-11 


Federal Crop Insurance Corporation 

7 CFR Parts 403, 405, 406, 409, 416, 
422, 425, 430, 435, 437, 441, 443, 445, 
446, 447, 450, 451, 454, 455, and 456 

[General Amendment Doc. No. 7987S1 

Apple, Arizona/California Citrus, 
Canning and Freezing Sweet Corn, 
Canning Peach, Hybrid Seed (Corn), 
Macadamia Nuts, Macadamia Trees, 
Pea, Peach, Peanut, Pepper, Popcorn, 
Potato, Prune, Sugar Beet, Table 
Grape, Tobacco (Quota Plan), Fresh 
Market Tomato (Guaranteed), Walnut, 
and Nursery Crop Insurance 
Regulations (respectively) 

AGENCY: Federal Crop Insurance 
Corporation, USDA. 
action: Interim rule with request for 
comment. 

summary: The Federal Crop Insurance 
Corporation (FCIC) amends the Apple, 
Arizona/Califomia Citrus, Canning and 
Freezing Sweet Com, Canning Peach. 
Hybrid Seed (Com), Macadamia Nuts, 
Macadamia Trees, Pea, Peach, Peanut, 
Pepper, Popcorn, Potato, Prune, Sugar 
Beet, Table Grape, Tobacco (Quota 
Plan), Fresh Market Tomato 
(Guaranteed), Walnut, and Nursery 
Crop Insurance Regulations (7 CFR Parts 
405, 409, 437, 451, 443, 455, 456, 416, 403, 
425, 445, 447, 422, 450, 430, 441. 435. 454, 
446, and 406, respectively), effective for 
the 1991 and succeeding crop years, by 
adding a mandatory amendment to each 
of the Crop Insurance Policies set forth 
in the Code of Federal Regulations part 
numbers above. The intended effect of 
this rule is to provide that, 
notwithstanding the terms of the crop 
insurance policy and any contract for 
crop insurance, coverage under the 
terms of such policies will be effective 
subject to the availability of 
appropriations for the 1991 and 
subsequent crop years. 

DATES: This interim rule is effective on 
September 4.1990. Written comments, 



















Federal Register / VoL 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35837 


data, and opinions on this interim rule 
must be submitted not later than 
November 3.1990, to be sure of 
consideration. 

aodresses: Written comments on this 
proposed rule should be sent to Peter F. 
Cole, Office of the Manager, Federal 
Crop Insurance Corporation, room 4090, 
South Building, U.S. Department of 
Agriculture, Washington, DC 20250. 

FOR FURTHER INFORMATION CONTACT: 
Peter F. Cole. Secretary, Federal Crop 
Insurance Corporation. U.S. Department 
of Agriculture, Washington, DC. 20250, 
telephone (202) 447-3325. 
SUPPLEMENTARY INFORMATION: This 
action has been reviewed under USDA 
procedures established by Departmental 
Regulation 1512-1. This action does not 
constitute a reveiw as to the need, 
currency, clarity, and effectiveness of 
the regulations affected by this rule 
under those procedures. The sunset 
review date established for those 
regulations is contained in each 
regulation. 

David W. Gabriel, Acting Manager, 
FCIC, (1) has detemined that this action 
is not a major rule as defined by 
Executive Order 12291 because it will 
not result in: (a) An annual effect on the 
economy of $100 million or more; (b) 
major increases in cost or prices for 
consumers, individual industries, 
Federal, State, or local governments, or 
a geographical region; or (c) significant 
adverse effects on competition, 
employment, investment, productivity, 
innovation, or the ability of U.S.-based 
enterprises to compete with foreign- 
based enterprises in domestic or export 
markets; and (2) certifies that this action 
will not increase the Federal paperwork 
burden for individuals, small businesses, 
and other persons and will not have a 
significant economic impact on a 
substantial number of small entities. 

This action is exempt from the 
provisions of the Regulatory Flexibility 
Act; therefore, no Regulatory Flexibility 
Analysis was prepared. 

This program is listed in the Catalog 
of Federal Domestic Assistance under 
No. 10.450. 

This program is not subject to the 
provisions of Executive Order 12372 
which requires intergovernmental 
consultation with State and local 
officials. See the Notice related to 7 CFR 
part 3015, subpart V, published at 48 FR 
29115. June 24,1983. 

This action is not expected to have 
any signifiant impact on the quality of 
the human environment, health, and 
safety. Therefore, neither an 
Environmental Assessment nor an 
Environmental Impact Statement is 
needed. 


FCIC herewith amends the Apple, 
Arizona/California Citrus, Canning and 
Freezing Sweet Com, Canning 5 
Processing Peach, Hybrid Seed (Corn), 
Macadamia Nuts. Macadamia Trees, 
Pea, Peach, Peanut, Pepper, Popcorn, 
Potato, Prune, Sugar Beet, Table Grape, 
Tobacco (Quota Plan), Fresh Market 
Tomato (Guaranteed), Walnut, and 
Nursery Crop Insurance Regulations (7 
CFR parts 405. 409, 437, 451, 443. 455, 

456, 416, 403, 425, 445, 447, 422, 450, 430, 
441, 435, 454, 446, and 406, respectively), 
effective for the 1991 and succeeding 
crop years, to provide a mandatory 
amendment to the provisions for 
coverage therein to provide that, 
notwithstanding the terms of the crop 
insurance policy, coverage will be 
effective subject to the availability of 
appropriations for the 1991 and 
subsequent crop years. 

The President’s budget for 1991 
provides for the elimination of the 
Federal Crop Insurance program by not 
funding the program for the 1991 crop 
year. In view of the uncertainty of 
Congressional action on that budget 
proposal, FCIC believes it is necessary 
to publish a rule requiring an 
amendment to all policies restating the 
general rule that public programs are 
subject to the availability of funds, so as 
to put all parties on notice that 
insurance coverage may not be 
available for the 1991 crop year. 
Equitable principles dictate that all 
parties concerned be aware of the 
uncertainty of insurance for the 1991 
crop year. Therefore, and since this rule 
is for the benefit of the policyholder, the 
rule is published as an Interim Rule 
without opportunity for prior notice and 
comment. 

A similar mandatory amendment was 
added by Interim Rule to all 
endorsements issued by FCIC under the 
General Crop Insurance Regulations (7 
CFR part 401) and published in the 
Federal Register on Wednesday, 
February 28,1990, at 55 6971. 

This rule is effective on September 4, 
1990. FCIC is soliciting public comment 
on this proposed rule for 60 days 
following publication in the Federal 
Register. Written comment should be 
6ent to Peter F. Cole, Office of the 
Manager, Federal Crop Insurance 
Corporation, room 4090. South Building, 
U.S. Department of Agriculture, 
Washington. DC 20250. 

All written comments received 
pursuant to this interim rule will be 
available for public inspection and 
copying in the Office of the Manager, 
Federal Crop Insurance Corporation, 
room 4090, South Building, U.S. 
Department of Agriculture. Washington, 


DC 20250, during regular business hours, 
Monday through Friday. 

This rule will be scheduled for review 
so that any amendment made necessary 
by public comment will be published in 
the Federal Register as quickly as 
possible. 

List of Subjects in 7 CFR Parts 403, 405, 
406, 409, 416, 422, 425, 430, 435, 437, 441, 
443,445, 446, 447. 450, 451,451,455, and 
456 

Crop insurance: Peach. Apple, 

Nursery Crop, Arizona/Califomia 
Citrus, Pea, Potato, Peanut Sugar Beet, 
Tobacco (Quota Plan), Canning and 
Freezing Sweet Corn, Table Grape, 
Hybrid Seed (Corn), Pepper, Walnut, 
Popcorn, Prune, Canning & Processing 
Peach. Fresh Market Tomato 
(Guaranteed). Macadamia Nuts, and 
Macadamia Trees (respectively). 

Interim Rule 

Accordingly, pursuant to the authority 
contained in the Federal Crop Insurance 
Act, as amended (7 U.S.C. 1501 el seq.), 
the Federal Crop Insurance Corporation 
hereby amends the Apple, Arizona/ 
California Citrus, Canning and Freezing 
Sweet Corn, Canning & Processing 
Peach. Hybrid Seed (Com), Macadamia 
Nuts, Macadamia Trees. Pea, Peach, 
Peanut. Pepper, Popcorn. Potato. Prune. 
Sugar Beet, Table Grape, Tobacco 
(Quota Plan), Fresh Market Tomato 
(Guaranteed), Walnut, and Nursery 
Crop Insurance Regulations (7 CFR parts 
405, 409, 437, 451, 443, 455. 456, 416, 403, 
425, 445, 447, 422, 450, 430. 441, 435, 454, 

446, and 406. respectively), effective for 
the 1991 and succeeding crop years, on 
any existing carryover contract or new 
contract for the 1991 crop year, by 
adding a mandatory amendment to the 
provisions for coverage therein. This 
rule amends the regulations set forth 
herein in the following instances; 

PARTS 403, 405, 406, 409, 416, 422, 

425, 430, 435, 437,441, 443, 445, 446, 

447, 450, 451, 454, 455, and 458 
(AMENDED] 

1. The authority citation for 7 CFR 
parts 403, 405, 406, 409. 416, 422, 425, 430, 
435. 437, 441. 443, 445, 446, 447, 450. 451, 
454. 455, and 456, continues to read as 
follows: 

Authority: 7 U.S.C. 1506.1518. 

§ 455.7 and 456.7 l Amended] 

2. 7 CFR 455.7(d), and 456.7(d), are 
amended by adding a new paragraph 20 
to read as follows: 

20. Notwithstanding the terms of the crop 
insurance policy and any contiact for crop 
insurance under the provisions of this part. 






35888 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


coverage under the terms of such crop 
insurance policy will be effective subject to 
the availability of appropriations. 

§§ 403.7, 405.7, 409.7, 416.7, 422.7, 425.7, 

430.7, 435.7, 437.7, 441.7, 443.7, 445.7, 446.7, 

447.7.450.7, 451.7, and 454.7 [Amended] 

3. 7 CFR 403.7(d), 405.7(d), 409.7(d), 
416.7(d). 422.7(d). 425.7(d), 430.7(d). 
435.7(d), 437.7(d). 441.7(d), 443.7(d), 
445.7(d), 446.7(d), 447.7(d), 450.7(d), 
451.7(d), and 454.7(d), and are amended 
by adding a new paragraph 21 to read as 
follows: 

21. Notwithstanding the terms of the crop 
insurance policy and any contract for crop 
insurance under the provisions of this part, 
coverage under the terms of such crop 
insurance policy will be effective subject to 
the availability of appropriations. 

§406.7 [Amended] 

4. 7 CFR 406.7(d) is amended by 
adding a new paragraph 22 to read as 
follows: 

22. Notwithstanding the terms of the crop 
insurance policy and any contract for crop 
insurance under the provisions of this part, 
coverage under the terms of such crop 
insurance policy will be effective subject to 
the availability of appropriations. 

Done in Washington, DC on August 27, 

1990. 

David W. Gabriel, 

Acting Manager, Federal Crop Insurance 
Corporation. 

[FR Doc. 90-20673 Filed 6-31-90; 8:45 am] 

BILLING CODE 3410-OS-ftl 


7 CFR Part 409 

[Amendment No. 2; Doc. No. 7755S] 

Arizona-California Citrus Crop 
Insurance Regulations 

agency: Federal Crop Insurance 
Corporation, USDA. 
action: Final rule. 

summary: The Federal Crop Insurance 
Corporation (FCIC) hereby adopts, as 
Final rule, an interim rule which was 
published in the Federal Register on 
Friday, September 22,1989, at 54 FR 
38961. The interim rule amended the 
Arizona-California Citrus Crop 
Insurance Regulation (7 CFR part 409) to 
change the date by which insureds are 
required to submit reports of production 
for insurance purposes. The intended 
effect of this rule is to change the 
incorrect date to reflect the date when 
such information becomes available to 
citrus insureds. 

effective date: This rule is effective 
September 4,1990. 

FOR FURTHER INFORMATION CONTACT. 

Peter F. Cole, Secretary, Federal Crop 
Insurance CorporaMon, U.S. Department 


of Agriculture, Washington, DC 20250, 
telephone (202) 447-3325. 
SUPPLEMENTARY INFORMATION: This 
action has been reviewed under USDA 
procedures established by Departmental 
Regulation 1512-1. This action does not 
constitute a review as to the need, 
currency, clarity, and effectiveness of 
these regulations under those 
procedures. The sunset review date for 
these regulations remains as February 1, 
1994. 

David W. Gabriel, Acting Manager, 
FCIC, (1) has determined that this action 
is not a major rule as defined by 
Executive Order 12291 because it will 
not result in: (a) An annual effect on the 
economy of $100 million or more; (b) 
major increases in costs or prices for 
consumers, individual industries, 
federal, State, or local governments, or a 
geographical region; or (c) significant 
adverse effects on competition, 
employment, investment, productivity, 
innovation, or the ability of U.S.-based 
enterprises to compete with foreign- 
based enterprises in domestic or export 
markets; and (2) certifies that this action 
will not increase the federal paperwork 
burden for individuals, small businesses, 
and other persons. 

This action is exempt from the 
provisions of the Regulatory Flexibility 
Act; therefore, no Regulatory Flexibility 
Analysis was prepared. 

This program is listed in the Catalog 
of Federal Domestic Assistance under 
No. 10.450. 

This program is not subject to the 
provisions of Executive Order 12372 
which requires intergovernmental 
consultation with State and local 
officials. See the Notice related to 7 CFR 
part 3015, subpart V, published at 48 FR 
29115, June 24,1983. 

This action is not expected to have 
any significant impact on the quality of 
the human environment, health, and 
safety. Therefore, neither an 
Environmental Assessment nor an 
Environmental Impact Statement is 
needed. 

On Friday, September 22,1989, FCIC 
published an interim rule in the Federal 
Register at 54 FR 38961, amending the 
Arizona-California Citrus Crop 
Insurance Regulations (7 CFR part 409) 
to change the incorrect date by which 
insureds are required to submit reports 
of production for insurance purposes to 
reflect the date when such information 
becomes available to citrus insureds. 

Written comments were solicited for 
60 days after publication in the Federal 
Register, and the rule was scheduled for 
review so that any amendment made 
necessary by public comment could be 
published in the Federal Register as 
quickly as possible. 


No comments were received, 
therefore, the interim rule is hereby 
adopted as a final rule. 

List of Subjects in 7 CFR Part 409 

Crop Insurance; Arizona-California 
Citrus. 

Final Rule 

Accordingly, the interim rule 
published in the Federal Register on 
Friday. September 22,1989, at 54 FR 
38961, is hereby adopted as a final rule. 

Authority: 7 U.S.C. 1506.1516. 

Done in Washington, DC, on August 27, 
1990. 

David W. Gabriel, 

Acting Manager, Federal Crop Insurance 
Corporation. 

[FR Doc. 90-20674 Filed 6-31-90; 8:45 am] 

BILUNG CODE 3410-08-M 


7 CFR Part 422 

[Amendment No. 4; Doc. No. 7387S] 

Potato Crop Insurance Regulations 

agency: Federal Crop Insurance 
Corporation, USDA. 
action: Final rule. 

summary: The Federal Crop Insurance 
Corporation (FCIC) hereby adopts, as a 
final rule, an interim rule which was 
published in the Federal Register on 
Tuesday. October 24,1989, at 54 FR 
43276. The interim rule amended the 
Potato Crop Insurance Regulations (7 
CFR part 422) to change the date for the 
end of the insurance period for potatoes in 
Delaware, Maryland, and New Jersey. 
The intended effect of this rule was to 
change an incorrect end of insurance 
period date to reflect the farming 
practices for potatoes in such states. 
effective date: This rule is effective 
September 4,1990. 

FOR FURTHER INFORMATION CONTACT 

Peter F. Cole, Secretary, Federal Crop 
Insurance Corporation, U.S. Department 
of Agriculture, Washington, DC 20250, 
telephone (202) 447-3325. 
SUPPLEMENTARY INFORMATION: This 
action has been reviewed under USDA 
procedures established by Departmental 
Regulation 1512-1. This action does not 
constitute a review as to the need, 
currency, clarity, and effectiveness of 
these regulations under those 
procedures. The sunset review date for 
these regulations remains as February 1, 
1994. 

David W. Gabriel, Acting Manager, 
FCIC, (1) has determined that this action 
is not a major rule as defined by 
Executive Order 12291 because it will 














Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35889 


not result in: (a) An annual effect on the 
economy of $100 million or more; (b) 
major increases in costs or prices for 
consumers, individual industries, 
federal. State, or local governments, or a 
geographical region; or (c) significant 
adverse effects on competition, 
employment, investment, productivity, 
innovation, or the ability of U.S.-based 
enterprises to compete with foreign- 
based enterprises in domestic or export 
markets; and (2) certifies that this action 
will not increase the federal paperwork 
burden for individuals, small businesses, 
and other persons. 

This action is exempt from the 
provisions of the Regulatory Flexibility 
Act; therefore, no Regulatory Flexibility 
Analysis was prepared. 

This program is listed in the Catalog 
of Federal Domestic Assistance under 
No. 10.450. 

This program is not subject to the 
provisions of Executive Order 12372 
which requires intergovernmental 
consultation with State and local 
officials. See the Notice related to 7 CFR 
part 3015, subpart V, published at 48 FR 
29115, June 24,1983. 

This action is not expected to have 
any significant impact on the quality of 
the human environment, health, and 
safety. Therefore, neither an 
Environmental Assessment nor an 
Environmental Impact Statement is 
needed. 

On Tuesday. October 24,1989, FCIC 
published an interim rule in the Federal 
Register at 54 FR 43276, amending the 
Potato Crop Insurance Regulations (7 
CFR part 422) to change the end of 
insurance period for potatoes in 
Delaware, Maryland, and New Jersey to 
more accurately reflect the farming 
practices for potatoes in such states. 

Written comments were solicited for 
GO days after publication in the Federal 
Register, and the rule was scheduled for 
review so that any amendment made 
necessary by public comment could be 
published in the Federal Register as 
quickly as possible. 

No comments were received, 
therefore, the interim rule is hereby 
adopted as a final rule. 

List of Subjects in 7 CFR Part 422 

Crop insurance; Potatoes. 

Final Rule 

Accordingly, the interim rule 
published in the Federal Register on 
Tuesday, October 24.1989, at 54 FR 
43276, is hereby adopted as a final rule. 

Authority: 7 U.S.C. 1506, 1516. 


Done in Washington, DC, on August 27. 
1990. 

David W. Gabriel, 

Acting Manager, Federal Crop Insurance 
Corporation. 

[FR Doc. 90-20675 Filed 8-31-90; 8:45 am] 

BILLING CODE 3410-06-M 


Agricultural Marketing Service 
7 CFR Part 910 
[Lemon Reg. 7331 

Lemons Grown in California and 
Arizona; Limitation of Handling 

agency: Agricultural Marketing Service, 
USDA. 

action: Final rule. 

summary: This regulation establishes 
the quantity of Califomia-Arizona 
lemons that may be shipped to domestic 
markets during the period from 
September 2 through September 8,1990. 
Consistent with program objectives, 
such action is needed to balance the 
supplies of fresh lemons with the 
demand for such lemons during the 
period specified. This action was 
recommended by the Lemon 
Administrative Committee (Committee), 
which is responsible for local 
administration of the lemon marketing 
order. 

EFFECTIVE dates: Regulation 733 (7 CFR 
part 910) is effective for the period from 
September 2 through September 8,1990. 
FOR FURTHER INFORMATION CONTACT: 
Beatriz Rodriguez, Marketing Specialist, 
Marketing Order Administration Branch, 
Fruit and Vegetable Division. 
Agricultural Marketing Service, U.S. 
Department of Agriculture (Department), 
Room 2524-S, P.O. Box 96450, 
Washington, DC 20090-6456; telephone: 
(202) 475-3861. 

SUPPLEMENTARY INFORMATION: This 
final rule is issued under Marketing 
Order 910 (7 CFR part 910), as amended, 
regulating the handling of lemons grown 
in California and Arizona. This order is 
effective under the Agricultural 
Marketing Agreement Act of 1937, a 9 
amended, hereinafter referred to as the 
Act. 

This final rule has been reviewed by 
the Department in accordance with 
Departmental Regulation 1512-1 and the 
criteria contained in Executive Order 
12291 and has been determined to be a 
"non-major” rule. 

Pursuant to requirements set forth in 
the Regulatory Flexibility Act (RFA), the 
Administrator of the Agricultural 
Marketing Service (AMS) has 
considered the economic impact of this 


action on small entities as well as larger 
ones. 

The purpose of the RFA is to fit 
regulatory actions to the scale of 
business subject to such actions in order 
that small businesses will not be unduly 
or disproportionately burdened. 
Marketing orders issued pursuant to the 
Act, and rules issued thereunder, are 
unique in that they are brought about 
through group action of essentially small 
entities acting on their own behalf. 

Thus, both statutes have small entity 
orientation and compatibility. 

There are approximately 70 handlers 
of lemons grown in California and 
Arizona subject to regulation under the 
lemon marketing order and 
approximately 2,000 lemon producers in 
the regulated area. Small agricultural 
producers have been defined by the 
Small Business Administration (13 CFR 
121.2) as those having annual receipts of 
less than $500,000, and small agricultural 
service firms are defined as those whose 
annual receipts are less than $3,500,000. 
The majority of handlers and producers 
of Califomia-Arizona lemons may be 
classified as small entities. 

The Califomia-Arizona lemon 
industry is characterized by a large 
number of growers located over a wide 
area. The Committee’s estimate of 1990- 
91 production is 40,834 cars (one car 
equals 1,000 cartons at 38 pounds net 
weight each), as compared with 37,881 
cars during the 1909-90 season. The 
production area is divided into three 
districts which span California and 
Arizona. The Committee estimates 
District 1, central California, 1990-91 
production at 6,495 cars compared to the 
4,158 cars produced in 1909-90. In 
District 2, southern California, the crop 
is expected to be 25,700 cars compared 
to the 24,292 cars produced last year. In 
District 3, the California desert and 
Arizona, the Committee estimates a 
production of 9,639 cars compared to the 
9,436 cars produced last year. The 
National Agricultural Statistics Service 
will publish on October 11,1990. an 
estimate of the 1990-91 lemon crop. 

The three basic outlets for Califomia- 
Arizona lemons are the domestic fresh, 
export, and processing markets. The 
domestic (regulated) fresh market is a 
preferred market for Califomia-Arizona 
lemons. The Committee estimates that 
about 44 percent of the 1990-91 crop of 
40,834 cars will be utilized in fresh 
domestic channels (17,900 cars), 
compared with the 1989-90 total of 
16,600 cars, about 44 percent of the total 
production of 37,881 cars in 1989-90. 
Fresh exports are projected at 22 
percent of the total 1990-91 crop 
utilization compared with 22 percent in 











35890 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


1989-90. Processed and other uses 
would account for the residual 34 
percent compared with 34 percent of the 
1989-90 crop. 

Volume regulations issued under the 
authority of the Act and Marketing 
Order No. 910 are intended to provide 
benefits to growers and consumers. 
Reduced fluctuations in supplies and 
prices result from regulating shipping 
levels and contribute to a more stable 
market. The intent of regulation is to 
achieve a more even distribution of 
lemons in the market throughout the 
marketing season and to avoid 
unreasonable fluctuations in supplies 
and prices. 

Based on the Committee's marketing 
policy, the crop and market information 
provided by the Committee, and other 
information available to the 
Department, the costs of implementing 
the regulations are expected to be more 
than offset by the potential of 
regulation. 

Reporting and recordkeeping 
requirements under the lemon marketing 
order are required by the Committee 
from handlers of lemons. However, 
handlers in turn may require individual 
growers to utilize certain reporting and 
recordkeeping practices to enable 
handlers to carry out their functions. 
Costs incurred by handlers in 
connection with recordkeeping and 
reporting requirements may be passed 
on to growers. 

The Committee submitted its 
marketing policy for the 1990-91 season 
to the U.S. Department of Agriculture 
(Department) on June 19. The marketing 
policy discussed, among other things, 
the potential use of volume and size 
regulations for the ensuing season. The 
Committee considered the use of volume 
regulation for the season. This 
marketing policy is available from the 
Committee or Ms. Rodriguez. The 
Department reviewed that policy with 
respect to administrative requirements 
and regulatory alternatives in order to 
determine if the use of volume 
regulations would be appropriate. 

The Committee met publicly on 
August 28.1990, in Los Angeles, 
California, to consider the current and 
prospective conditions of supply and 
demand and unanimously recommended 
that 310,000 cartons is the quantity of 
lemons deemed advisable to be shipped 
to fresh domestic markets during the 
specified week. The marketing 
information and data prov ided to the 
Committee and used in its deliberations 
were compiled by the Committee’s staff 
or presented by Committee members at 
the meeting. This information included, 
but was not limited to, price data for the 
previous week from Department market 


news reports and other sources, the 
preceding week’9 shipments and 
shipments to date, crop conditions, 
weather and transportation conditions, 
and a reevaluation of the prior week’s 
recommendation in view of the above. 

The Department reviewed the 
Committee’s recommendation in light of 
the Committee’s projections as set forth 
in its 1990-91 marketing policy. This 
recommended amount is 21,000 cartons 
above the estimated projections in the 
revised shipping schedule. 

During the week ending on August 25. 
1990, shipments of lemons to fresh 
domestic markets, including Canada, 
totaled 313.000 cartons compared with 
288,000 cartons shipped during the week 
ending on August 26,1989. Export 
shipments totaled 140,000 cartons 
compared with 134,000 cartons shipped 
during the week ending on August 26, 

1989. Processing and other uses 
accounted for 263,000 cartons compared 
with 108,000 cartons shipped during the 
week ending on August 26,1989. 

Fresh domestic shipments to date for 
the 1990-91 season total 1,213,000 
cartons compared with 1,186,000 cartons 
shipped by this time during the 1989-90 
season. Export shipments total 558,000 
cartons compared with 624,000 cartons 
shipped by this time during 1989-90. 
Processing and other use shipments total 
1.027,000 cartons compared with 527.000 
cartons shipped by this time during 
1989-90. 

For the week ending on August 25, 

1990, regulated shipments of lemons to 
the fresh domestic market were 313,000 
cartons on an adjusted allotment of 
347,000 cartons which resulted in net 
undershipments of 34,000 cartons. 
Regulated shipments for the current 
week (August 26 through September 1. 
1990] are estimated at 320,000 cartons on 
an adjusted allotment of 343.000 cartons. 
Thus, undershipments of 23,000 cartons 
could be carried over into the week 
ending on September 8,1990. 

The average Lo.b. shipping point price 
for the week ending on August 25,1990, 
was $12.43 per carton based on a 
reported sales volume of 311,000 cartons 
compared with last week's average of 
$11.80 per carton on a reported sales 
volume of 287,000 cartons. The 1990-91 
season average f.o.b. shipping point 
price to date is $12.77 per carton. The 
average Lo.b. shipping point price for 
the week ending on August 26,1989, was 
$14.40 per carton; the season average 
f.o.b. shipping point price at this time 
during 1989-90 was $14.10 per carton. 

The Department’s Market News 
Serv ice reported that, as of August 28. 
demand for lemons of all sizes and 
grades is moderate. The market is 
“about steady’* for all grades and sizes 


of lemons. At the meeting, one 
Committee member commented that 
movement on first and second grade 
fruit, especially large-sized lemons, 
increased. The member also stated that 
there is some inventory build-up on 
small-size lemons (200’s and smaller). 
That member as well as another 
member mentioned the need to maintain 
an orderly market, especially in the 
transitional period between District 2 
and District 3 which is about to begin. 
The Committee unanimously 
recommended volume regulation for the 
period from September 2 through 
September 8,1990. 

Based upon fresh utilization levels 
indicated by the Committee and an 
econometric model developed by the 
Department, the California-Arizona 
1990-91 season average fresh on-tree 
price is estimated at $9.54 per carton. 

116 percent of the projected season 
average fresh on-tree parity equivalent 
price of $8.20 per carton. The Califomia- 
Arizona 1909-90 season average fresh 
on-tree price is estimated at $8.53,114 
percent of the projected season average 
fresh on-tree parity equivalent price of 
$7.47 per carton. 

Limiting the quantity of lemons that 
may be shipped during the period from 
September 2 through September 8,1990, 
would be consistent with the provisions 
of the marketing order by tending to 
establish and maintain, in the interest of 
producers and consumers, an orderly 
flow of lemons to market. 

Based on considerations of supply and 
market conditions, it is found that this 
action will tend to effectuate the 
declared policy of the Act. 

Based on the above information, the 
Administrator of the AMS has 
determined that issuance of this rule 
will not have a significant economic 
impact on a substantial number of small 
entities. 

Pursuant to 5 U.S.C. 553, it is further 
found and determined that it is 
impracticable, unnecessary, and 
contrary to the public interest to give 
preliminary notice and engage in further 
public procedure with respect to this 
action and that good cause exists for not 
postponing the effective date of this 
action until 30 days after publication in 
the Federal Register. This is because 
there is insufficient time between the 
date when information became 
available upon which this regulation is 
based and the effective date necessary 
to effectuate the declared policy of the 
Act. 

In addition, market information 
needed for the formulation of the basis 
for this action was not available until 
August 28,1990. and this action needs to 












Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35891 


be effective for the regulatory week 
which begins on September 2,1990. 
Further, interested persons were given 
an opportunity to submit information 
and views on the regulation at an open 
meeting, and handlers were apprised of 
its provisions and effective time. It is 
necessary, therefore, in order to 
effectuate the declared purposes of the 
Act, to make this regulatory provision 
effective as specified. 

List of Subjects in 7 CFR Part 910 

Lemons, Marketing agreements, and 
Reporting and recordkeeping 
requirements. 

For the reasons set forth in the 
preamble, 7 CFR part 910 is amended as 
follows: 

PART 910—LEMONS GROWN IN 
CALIFORNIA AND ARIZONA 

1. The authority citation for 7 CFR 
part 910 continues to read as follows: 

Authority: Secs. 1-19, 48 Stat. 31, as 
amended; 7 U.S.C. 601-874. 

2. Section 910.733 is added to read a9 
follows: 

Note: This section will not appear in the 
Code of Federal Regulations. 

§ 910.733 Lemon Regulation 733. 

The quantity of lemons grown in 
California and Arizona which may be 
handled during the period from 
September 2 through September 8,1990, 
is established at 310,000 cartons. 

Dated: August 29.1990. 

Ronald L.Cioffi, 

Acting Deputy Director, Fruit and Vegetable 
Division. 

|FR Doc. 90-20767 Filed 8-31-90: 8:45 am] 
BILLING COD€ 3410-02-M 


7 CFR Parts 932 and 944 
l Docket No. FV-90-193IFR] 

Olives Grown In California and 
Imported Olives; Interim Final Rule 
Establishing Grade and Size 
Requirements for Limited Use Styles 
of California Processed Olives for 
1990-91 Season, and Conforming 
Changes in the Olive Import 
Regulation 

agency: Agricultural Marketing Service, 
USDA. 

action: Interim final rule with request 
for comments. 

summary: This interim final rule 
establishes grade and size requirements 
for California processed olives used in 
the production of limited use styles of 
olives such as wedges, halves, slices, or 


segments and establishes similar 
requirements in the olive import 
regulation to bring that regulation into 
conformity with the domestic 
requirements. The grade and size 
requirements are the same as 
implemented last season. Olives used in 
limited use styles are too small to be 
desirable for use as whole or whole 
pitted canned olives because their flesh- 
to-pit ratio is too low. Flowever, they are 
satisfactory for use in the production of 
limited use styles. Their use in such 
products over the years has helped the 
California olive industry meet the 
increasing market needs of the food 
service industry. The requirements for 
domestic olives were unanimously 
recommended by the California Olive 
Committee (committee), which works 
with the Department in administering 
the marketing order program for olives 
grown in California. The establishment 
of such requirements for imported olives 
is required pursuant to section 8e of the 
Agricultural Marketing Agreement Act 
of 1937. 

dates: This interim Final rule becomes 
effective September 4,1990. Comments 
which are received by October 4,1990 
will be considered prior to issuance of a 
final rule. 

addresses: Written comments 
concerning this rule should be submitted 
in triplicate to the Docket Clerk, F&V 
Division, AMS, USDA, P.O. Box 96456, 
room 2525-S, Washington, DC 20090- 
6456. All comments submitted will be 
made available for public inspection in 
the above office during regular business 
hours. Comments should reference the 
docket number and the date and page 
number of this issue of the Federal 
Register. 

FOR FURTHER INFORMATION CONTACT: 

Patrick Packnett, Marketing Order 
Administration Branch, Fruit and 
Vegetable Division, AMS, USDA, P.O. 
Box 96458, room 2530-S, Washington. 

DC 20090-6456; telephone (202) 47S- 
3862. 

SUPPLEMENTARY INFORMATION: This 
interim final rule is issued under 
Marketing Agreement and Order No. 932 
(7 CFR part 932), as amended, regulating 
the handling of olives grown in 
California, hereinafter referred to as the 
order. The order is effective under the 
Agricultural Marketing Agreement Act 
of 1937, as amended (7 U.S.C. 601-674), 
hereinafter referred to as the Act. 

This interim final rule has been 
reviewed by the Department in 
accordance with Departmental 
Regulation 1512-1 and the criteria 
contained in Executive Order 12291 and 
has been determined to be a “non- 
major” rule. 


Pursuant to requirements set forth in 
the Regulatory Flexibility Act (RFA), the 
Administrator of the Agricultural 
Marketing Service has considered the 
economic impact of this action on small 
entities. 

The purpose of the RFA is to fit 
regulatory actions to the scale of 
business subject to such actions in order 
that small businesses will not be unduly 
or disproportionately burdened. 
Marketing orders issued pursuant to the 
Act, and rules issued thereunder, are 
unique in that they are brought about 
through group action of essentially small 
entities acting on their own behalf. 

Thus, both statutes have small entitiy 
orientation and compatibility. 

There are seven handlers of California 
olives subject to regulation under the 
order and approximately 1,400 
producers in California. Approximately 
25 importers of olives are subject to the 
olive import regulation. Small 
agricultural producers have been 
defined by the Small Business 
Administration (13 CFR 121.2) as those 
having annual receipts of less than 
$500,000, and small agricultural service 
firms are defined as those whose annual 
receipts are less than $3,500,000. Most 
but not all of the olive producers and 
importers may be classified as small 
entities. None of the olive handlers may 
be classified as small entities. 

Nearly all of the olives grown in the 
United States are produced in 
California. The growing areas are 
scattered throughout California with 
most of the commercial production 
coming from inland valleys. In 1989, 
about 66 percent of the production came 
from the San Joaquin Valley and 34 
percent from the Sacramento Valley. 

Olive production has fluctuated from 
a low of 24,200 tons during the 1972-73 
crop year to a high of 146,500 tons during 
the 1982-83 crop year. The committee 
indicated that 1989 production totalled 
about 118,990 tons. The various varieties 
of olives produced in California have 
alternate bearing tendencies with high 
production one year and low the next. 
The industry expects the 1990-91 crop to 
be about 90,000 tons. 

The primary use of California olives is 
for canned ripe whole and whole pitted 
olives which are eaten out of hand as 
hors d’oeuvres or used as an ingredient 
in cooking and in salads. The canned 
ripe olive market is essentially a 
domestic market. Very few California 
olives are exported. 

This action will allow handlers to 
market more olives than would be 
permitted in the absence of this 
relaxation in size requirements. This 
additional opportunity is provided to 














35892 Federal Register / VoL 55. No. 171 / Tuesday. September 4. 1990 / Rules and Regulations 


maximize the use of the California olive 
supply, facilitate market expansion, and 
benefit both growers and handlers. 

The interim rule modifies 5 932.153 of 
Subpart-Rules and Regulations (7 CFR 
932.108-932.161). The modification 
establishes grade and size regulations 
for 1990-91 crop limited use size olives. 
The modification is issued pursuant to 
paragraph (a)(3) of 5 932.52 of the order. 
This rule also makes necessary 
conforming changes in the olive import 
regulation fOlive Regulation 1; 7 CFR 
944.401). The import regulation is issued 
pursuant to section 8e of the Act. 

Section 8e provides that whenever 
grade, size, quality, or maturity 
provisions are in effect for specified 
commodities, including olives, under a 
marketing order, the same or 
comparable requirements must be 
imposed on the imports. 

Paragraph (a)(3) of § 932.52 of the 
marketing order provides that processed 
olives smaller than the sizes prescribed 
for whole and whole pitted styles may 
be used for limited uses if recommended 
by the committee and approved by the 
Secretary. The sizes are specified in 
terms of minimum weights for individual 
olives in various size categories. The 
section further provides for the 
establishment of size tolerances. 

To allow handlers to take advantage 
of the strong market for halved, 
segmented, sliced, and chopped canned 
ripe olives, the committee recommended 
that grade and size requirements again 
be established for limited use olives for 
the 1990-91 crop year (August 1,1990 
through July 31,1991). The grade 
requirements are the same as those 
applied during the 1990-91 crop year, as 
are the sizes and the size tolerances. 
Permitting handlers to use small olives 
in the production of limited use style 
canned olives will have a positive 
impact on industry returns. In the 
absence of this action, the undersized 
fruit would have to be used for non¬ 
canning uses, like oil for which returns 
are lower. Except for the changes 
necessary in the effective date, the 
provisions, hereinafter set forth in 
§ 932.153, are the same as those 
established last season. 

Paragraph (b)[12) of § 944.401 of the 
olive import regulation allows imported 
bulk olives which do not meet the 
minimum size requirements for canned 
whole and whole pitted ripe olives to be 
used for limited use styles if they meet 
specified size requirements. 
Continuation of the limited use 
authorization for California olives by 
this interim rule requires that similar 
changes be made in paragraph (b)(12) of 
§ 944.401 to keep the import regulation 
in conformity with the applicable 


domestic requirements. These 
conforming changes will benefit 
importers because they will be able to 
import small-sized olives for limited use 
during the 1990-91 season which ends 
July 31.1991. 

Based on available information, the 
Administrator of the AMS has 
determined that this action will not have 
a significant economic impact on a 
substantial number of small entities 
because it provides handlers and 
importers more marketing flexibility. 

After consideration of all relevant 
matter presented, the information and 
recommendations submitted by the 
committed, and other available 
information, it is found that authorizing 
the use of smaller olives in the 
production of limited use styles will tend 
to effectuate the declared policy of the 
Act. 

Pursuant to 5 U.S.C. 553. it is found 
and determined that upon good cause it 
is impracticable, unnecessary, and 
contrary to the public interest to give 
preliminary notice prior to putting this 
rule into effect, and that good cause 
exists for not postponing the effective 
date of this action until 30 days after 
publication in the Federal Register 
because: (1) Compliance with this action 
will require no special preparation by 
handlers and importers; (2) it is 
important that these requirements apply 
to as much of the 1990-91 marketing 
season as possible; (3) the olive import 
requirements are mandatory under 
section 8e of the Act; (4) this action 
relieves restrictions on handlers and 
importers; and (5) the rule provides a 30- 
day comment period, and any comments 
received will be considered prior to 
finalization of this interim final rule. 

List of Subjects 

7 CFR Pari 932 

Marketing agreements. Olives. 
Reporting and recordkeeping 
requirements. 

7 CFR Part 944 

Avocados, Food grades and 
standards, Grapefruit, Grapes, Imports. 
Limes. Olives and oranges. 

For the reasons set forth in the 
preamble, 7 CFR parts 932 and 944 are 
amended as follows. 

Note: These sections will appear in the 
Code of Federal Regulations. 

1. The authority citations for 7 CFR 
parts 932 and 944 continue to read as 
follows: 

Authority: Secs. 1-19, 48 Stat. 31. as 
amended; 7 U.S.C. 601-674. 


PART 932—OLIVES GROWN IN 
CALIFORNIA 

2. Section 932.153 is revised to read as 
follows; 

§ 932.153 Establishment of grade and size 
requirements for processed 1990-91 crop 
year olives for limited use. 

(a) Grade . On and after September 4, 
1990. any handler may use processed 
olives of the respective variety group in 
the production of limited use styles of 
canned ripe olives if such olives were 
processed after July 31,1990, and meet 
the grade requirements specified in 
paragraph (a)(1) of §932.52 as modified 
by § 932.149. 

(b) Sizes . On and after September 4. 
1990, any handler may use processed 
olives in the production of limited use 
styles of canned ripe olives if such 
olives were harvested during the period 
August 1, 1990, through July 31, 1991, and 
meet the following requirements: 

(1) The processed olives shall be 
identified and kept separate and apart 
from any olives harvested before August 
1,1990, or after July 31,1991. 

(2) Variety Group 1 olives, except the 
Ascolano, Barouni, or St. Agostino 
varieties, shall be of a size which 
individually weigh 1/90 pound: 

Provided, That no more than 35 percent 
of the olives in any lot or sublot may be 
smaller than 1/90 pound. 

(3) Variety Group 1 olives of the 
Ascolano, Barouni, or St. Agostino 
varieties shall be of a size which 
individually weigh 1/140 pound: 
Provided, That no more than 35 percent 
of the olives in any lot or sublot may be 
smaller than 1/140 pound. 

(4) Variety Group 2 olives, except the 
Obliza variety, shall be of a size which 
individually weigh 1/180 pound: 
Provided, That no more than 35 percent 
of the olives in any lot or sublot may be 
smaller than 1/180 pound. 

(5) Variety Group 2 olives of the 
Obliza variety shall be of a size which 
individually weigh 1/140 pound: 
Provided. That no more than 35 percent 
of the olives in any lot or sublot may be 
smaller than 1/140 pound. 

PART 944—FRUITS; IMPORT 
REGULATIONS 

5. Section 944.401 is amended by 
revising the introductory text of 
paragraph (b)(12) to read as follows: 

§944.401 Olive Regulation 1. 

• « • * * 

(b) * * • 

(12) Imported bulk olives when usea 
in the production of canned ripe olives 
must be inspected and certified as 
















Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35893 


prescribed in this section. Imported bulk 
olives which do not meet the applicable 
minimum size requirements specified in 
paragraphs (b)(2) through (b)(ll) of this 
section may be imported during the 
period September 4.1990, through July 
31,1991, for limited use, but any such 
olives so used shall not be smaller than 
the following applicable minimum size: 

* « • « • 

Dated: August 29,1990. 

Robert C. Keeney, 

Deputy Director, Fruit and Vegetable 
Division. 

[FR Doc. 90-20742 Filed 8-31-90; 8:45 am] 

BILLING CODE 3410-02-M 


7 CFR Part 967 
(FV-90-178FRJ 

Handling Regulation for Celery Grown 
in Florida 

agency: Agricultural Marketing Service, 
USDA. 

action: Final rule. 

SUMMARY: This action establishes the 
quantity of Florida celery which 
handlers may ship to fresh markets 
during the 1990-91 marketing season at 
6,789,738 crates or 100 percent of 
producers' base quantities. This final 
rule is intended to lend stability to the 
industry and. thus, help to provide 
consumers with an adequate supply of 
the product As in past marketing 
seasons, the limitation on the quantity of 
Florida celery handled for fresh 
shipment is not expected to restrict the 
quantity of Florida celery actually 
produced or shipped to fresh markets, 
since production and shipments are 
anticipated to be less than the allotment. 
This action was recommended by the 
Florida Celery Committee (Committee), 
the agency responsible for local 
administration of the order. 

EFFECTIVE dates: September 4,1990. 

FOR FURTHER INFORMATION CONTACT: 
Sheila Young, Marketing Specialist. 
Marketing Order Administration Branch, 
Fruit and Vegetable Division. AMS. 
USDA. Room 2525-S, P.O. Box 96456, 
Washington. DC 20090-6456; telephone: 
(202) 475-5992. 

SUPPLEMENTARY INFORMATION: This 
final rule is issued under Marketing 
Agreement and Order No. 967 (7 CFR 
part 967), both as amended, regulating 
the handling of celery grown in Florida. 
The order is effective under the 
Agricultural Marketing Agreement Act 
of 1937, as amended (7 U.S.C. 601-674), 
hereinafter referred to as the Act. 

This final rule has been reviewed by 
the U.S. Department of Agriculture in 


accordance with Departmental 
Regulation No. 1512-1 and the criteria 
contained in Executive Order 12291 and 
has been determined to be a "non¬ 
major" rule. 

Pursuant to requirements set forth in 
the Regulatory Flexibility Act (RFA), the 
Administrator of the Agricultural 
Marketing Service (AMS) has 
considered the economic impact of this 
final rule on small entities. 

The purpose of the RFA is to fit 
regulatory actions to the scale of 
business subject to such actions in order 
that small businesses will not be unduly 
or disproportionately burdened. 
Marketing orders issued pursuant to the 
Act. and rules issued thereunder, are 
unique in that they are brought about 
through group action of essentially small 
entities acting on their own behalf. 

Thus, both statutes have small entity 
orientation and compatibility. 

There are an estimated 7 handlers of 
celery grown in Florida subject to 
regulation under the celery marketing 
order, and approximately 13 producers 
of celery in the production area. Small 
agricultural producers have been 
defined by the Small Business 
Administration (13 CFR 121.2) as those 
having annual receipts of less than 
$500,000, and small agricultural service 
firms are defined as those whose annual 
receipts are less than $3,500,000. The 
majority of celery handlers and 
producers may be classified as small 
entities. 

This final rule is based upon the 
recommendation and information 
submitted by the Committee and upon 
other available information. The 
Committee met on June 12,1990, and 
recommended a marketable quantity of 
6,789,738 crates of fresh celery for the 
1990-91 marketing season beginning 
August 1,1990. Additionally, a uniform 
percentage of 100 percent was 
recommended which allows each 
producer registered pursuant to 
5 967.37(f) of the order to market 100 
percent of such producer's base 
quantity. These recommendations were 
based on an appraisal of expected 1990- 
91 supplies and prospective demand. 

As required by § 967.37(d)(1) of the 
order, a reserve of 8 percent (407,384 
crates) of the 1989-90 total base 
quantities is authorized for new 
producers and increases for existing 
producers. 

The final rule will limit the quantity of 
Florida celery which handlers may 
purchase from producers and ship to 
fresh markets during the 1990-91 
marketing season to 6,789.738 crates. 
This marketable quantity is identical to 
the 1989-90 marketable quantity and is 
about 17 percent more than the average 


number of crates marketed fresh during 
the 1984-85 through 1988-89 seasons. It 
is expected that the 6.789,738 crate 
marketable quantity will be above 
actual shipments for the 1990-91 season. 
Thus, the 6,789.738 crate marketable 
quantity is not expected to restrict the 
amount of Florida celery which growers 
produce or the amount of celery which 
handlers ship. For these reasons, this 
final action shall lend stability to the 
industry and. thus, help to provide 
consumers with an adequate supply of 
the product. 

Based on available information, the 
Administrator of the AMS has 
determined that issuance of this final 
rule will not have a significant economic 
impact on a substantial number or small 
entities. 

This action was proposed in the July 
23,1990, issue of the Federal Register (55 
FR 29852). Comments on the proposed 
rule were invited from interested 
persons until August 2,1990. No 
comments were received. 

After consideration of the information 
and recommendations submitted by the 
Committee and other available 
information, it is found that this final 
rule will tend to effectuate the declared 
policy of the Act. 

Pursuant to 5 U.S.C. 553, it is hereby 
found and determined that good cause 
exists for not postponing the effective 
date of this action until 30 days after 
publication in the Federal Register 
because: (1) The 1996-91 crop year for 
Florida celery began on August 1.1990; 
and (2) handlers are aware of this 
action, which was recommended by the 
Committee at a public meeting, and 
need no additional time to comply with 
the requirements. 

List of Subjects in 7 CFR Part 967 

Celery, Florida, Marketing 
agreements. Reporting and 
recordkeeping requirements. 

For the reasons set forth in the 
preamble, 7 CFR part 967 is amended as 
follows: 

PART 967—CELERY GROWN IN 
FLORIDA 

1. The authority citation for 7 CFR 
part 967 continues to read as follows: 

Note: This section will not appear in the 
annual Code of Federal Regulations. 

Authority: Secs. 1-19, 48 Stat 31. as 

amended: 7 U.S.C. 601-674. 

Subpart—Administrative Rules and 
Regulations 

2. A new § 967.326 is added to read as 
follows: 











35894 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


§ 967.326 Handling regulation, marketable 
quantity, and uniform percentage for the 
1990-91 season beginning August 1,1990. 

(a) The marketable quantity 
established under § 967.36(a) is 6,789,738 
crates of celery. 

(b) As provided in § 967.38(a), the 
uniform percentage shall be 100 percent. 

(c) Pursuant to § 967.36(b), no handler 
shall handle any harvested celery unless 
it is within the marketable allotment of a 
producer who has a base quantity and 
such producer authorizes the first 
handler thereof to handle it. 

(d) As required by § 967.37(d)(1), a 
reserve of six percent of the total base 
quantities is hereby authorized for: (1) 
New producers and (2) increases for 
existing base quantity holders. 

(e) Terms used herein shall have the 
same meaning as when used in the said 
marketing agreement and order. 

Dated: August 29.1990. 

Robert C. Keeney, 

Acting Director. Fruit and Vegetable Division . 
(FR Doc. 90-20741 Filed 3-31-90; 8:45 am) 
BILLING CODE 3410-02-M 


7 CFR Part 1076 
IDA-90-026) 

Milk in the Eastern South Dakota 
Marketing Area; Order Terminating 
Certain Provisions of the Order 

AGENCY: Agricultural Marketing Service, 
USDA. 

action: Termination of rules. 

summary: This action terminates certain 
provisions of the Eastern South Dakota 
Federal milk order. The provisions relate 
to the limits on the amount of milk not 
needed for fluid (bottling) use that may 
be moved directly from farms to nonpool 
manufacturing plants and still be priced 
under the order. Suspension of the 
provisions, during August 1990 through 
February 1991, was requested by a 
cooperative association representing 
most of the producers supplying the 
market to prevent uneconomic 
movements of milk. Since these 
provisions have been suspended for the 
last eight years, comments were 
requested on whether the provisions 
should be terminated. In view of this 
history, the cooperative association that 
proposed the suspension action 
supported a termination of the 
provisions. No opposing views were 
received. 

EFFECTIVE DATE: September 4.1990. 

FOR FURTHER INFORMATION CONTACT: 

John F. Borovies, Marketing Specialist, 
USDA/AMS/Dairy Division. Order 
Formulation Branch, Room 2968, South 


Building, P.O. Box 96456, Washington. 

DC 20090-6456, (202) 447-2089. 
SUPPLEMENTARY INFORMATION: Prior 
document in this proceeding: Notice of 
Proposed Suspension or Termination: 
Issued July 17,1990: published July 23, 
1990 (55 FR 29854). 

The Regulatory Flexibility Act (5 
U.S.C. 601-612) requires the Agency to 
examine the impact of a rule on small 
entities. Pursuant to 5 U.S.C. 605(b), the 
Administrator of the Agricultural 
Marketing Service has certified that this 
action will not have a significant 
economic impact on a substantial 
number of small entities. Such action 
lessens the regulatory impact of the 
order on certain milk handlers and tends 
to ensure that dairy farmers will 
continue to have their milk priced under 
the order and thereby receive the 
benefits that accrue from such pricing. 

This final rule has been reviewed by 
the Department in accordance with 
Departmental Regulation 1512-1 and the 
criteria contained in Executive Order 
12291 and has been determined to be a 
“non-major” rule. 

This order of termination is issued 
pursuant to the provisions of the 
Agricultural Marketing Agreement Act 
of 1937, as amended (7 U.S.C. 601-674), 
and of the order regulating the handling 
of milk in the Eastern South Dakota 
marketing area. 

Notice of proposed rulemaking was 
published in the Federal Register on July 
23,1990 (55 FR 29854) concerning a 
proposed suspension or termination of 
certain provisions of the order. 

Interested parties were afforded the 
opportunity to file written data, views, 
and arguments thereon. No comments 
opposing the actions were received. 

After consideration of all relevant 
material, including the proposal in the 
notice, the comments received, and 
other available information, it is hereby 
found and determined that the following 
provisions of the order do not tend to 
effectuate the declared policy of the Act. 

In § 1076.13, paragraphs (c) (2), (3) and 

(4). 

Statement of Consideration 

Land O'Lakes, Inc. (LOL), an 
association of producers that supplies 
most of the market’s fluid milk needs 
and handles most of the market's 
reserve milk supplies, requested a 
suspension of certain provisions of the 
order. The requested suspension would 
remove for August 1990 through 
February 1991 the limit on the amount of 
producer milk that a cooperative 
association or other handlers may divert 
from pool plants to nonpool plants. A 
similar suspension has been in effect 
during these months since 1982. 


The order now provides that a 
cooperative association may divert up to 
35 percent of its total member milk 
received at all pool plants or diverted 
therefrom during the months of August 
through February. Similarly, the 
operator of a pool plant may divert up to 
35 percent of its receipts of producer 
milk (for which the operator of such 
plant is the handler during the month) 
during the months of August through 
February. 

LOL indicates that operation of the 35- 
percent diversion limit during August 
through February would mean that at 
least 65 percent of its milk would have 
to be delivered to pool plants. LOL 
estimates, moreover, that only 
approximately 44 percent of its milk will 
be needed at distributing plants during 
August 1990-February 1991. The balance 
would have to be delivered to pool 
plants, unloaded, reloaded and then 
shipped to other plants merely to qualify 
the milk for pooling. The additional 
handling and hauling costs would be 
incurred by LOL with no offsetting 
benefits to other market participants, 
according to LOL. In addition, the 
cooperative states, additional pumpings 
of milk can be expected to cause 
deterioration in its quality. 

LOL states that even in the absence of 
diversion limitations, the cooperative 
must continue to deliver at least 35 
percent of its producer receipts to pool 
distributing plants under other pooling 
standards in order to pool all milk. The 
cooperative affirms its commitment to 
supplying the total needs of Eastern 
South Dakota distributing plants. 

These provisions of the order that 
limit diversion to nonpool plants have 
been suspended during the August- 
February period during each of the last 
eight years. In view of this history, 
interested parties were invited to submit 
comments on whether the provisions 
should be terminated rather than 
suspended for the August 1990-February 
1991 period. 

In response to the notice of proposed 
actions, LOL supported a termination of 
the provisions and no views opposing 
the action were received. As a result of 
the eight-year history of the suspension 
of these provisions, it is determined that 
the provisions should be terminated. 

It is hereby found and determined that 
thirty days’ notice of the effective date 
hereof are impractical, unnecessary and 
contrary to the public interest in that: 

(a) The termination is necessary to 
reflect current marketing conditions and 
to assure orderly marketing conditions 
in.the marketing area in that dairy 
farmers who regularly supply the market 
will continue to have their milk priced 















Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35895 


under the other without the need for 
handlers to engage in unnecessary and 
expensive hauling and handling 

practices: 

(b) This termination does not require 
of persons affected substantial or 
extensive preparation prior to the 
effective date; and 

(c) Notice of proposed rulemaking was 
given interested parties and they were 
afforded opportunity to file written data, 
views, or arguments concerning this 
termination. One response in support of 
the proposed action and no comments in 
opposition were received. 

Therefore, good cause exists for 
making this order effective upon 
publication in the Federal Register. 

List of Subjects in 7 CFR Part 1076 

Milk marketing orders. 

It is therefore ordered. That the 
aforesaid provisions in § 1076.13 the 
Eastern South Dakota order are hereby 
terminated. 

PART 1076—MILK IN THE EASTERN 
SOUTH DAKOTA MARKETING AREA 

1. The authority citation for 7 CFR 
part 1076 continues to read as follows: 

Authority: Secs. 1-19. 48 Stat. 31. as 
amended; 7 U.SXL 601-674. 

§1076.13 [Amended] 

2. In § 1076.13, paragraphs (c) (2), (3) 
and (4) are removed and reserved. 

Signed at Washington. DC. on August 27. 
199a 

John E. Frydenlund, 

Deputy Assistant Secretary . Marketing and 
Inspection Services. 

[FR Doc. 90-20623 Filed 8-31-90; 8:45 am] 
BILLING CODE 3410-02*41 


Farmers Home Administration 

7 CFR Parts 1922,1930, and 1944 

Rural Rental Housing Loan Policies, 
Procedures, and Authorizations 

agency: Farmers Home Administration. 
USDA. 

action: Final rule. 

summary: The Farmers Home 
Administration (FmHA) amends the 
Agency's loan policies and procedures 
governing appraisal of rental housing. 
This change will authorize and establish 
a policy to use contract appraisers in the 
rural rental housing loan programs. The 
intended effect of this action is to 
increase objectivity in Agency loan 
making decisions. 

EFFECTIVE DATE: September 4.1990. 


FOR FURTHER INFORMATION CONTACT. 

Steven D. Jorgensen, Senior Loan 
Officer, Multi-Family Housing Branch. 
Loan Processing Division. Fanners 
Home Administration, U.S. Department 
of Agriculture, room 5347, South 
Agriculture Building. 14th and 
Independence Avenue SW.. 

Washington, DC 20250; telephone (202) 
382-1608. 

SUPPLEMENTARY INFORMATION: This 
action has been reviewed under USDA 
procedures established in Departmental 
Regulation 1512-1, which implements 
Executive Order 12291, and has been 
determined to be exempt from those 
requirements because it involves only 
interna] agency management. It is the 
policy of this Department to publish for 
comment rules relating to public 
property, loans, grants, benefits, or 
contracts, notwithstanding the 
exemption in 5 U.S.C. 553 with respect 
to such rules. This action, however, is 
not published for proposed rule making 
since it involves only internal agency 
management making publication for 
comment unnecessary. 

Intergovernmental Review 

This program/activity is listed in the 
Catalog of Federal Domestic Assistance 
under No. 10.415, Rural Rental Housing 
Loans and is subject to the provisions of 
Executive Order 12371 which requires 
intergovernmental consultation with 
State and local officials. 7 CFR 3015, 
subpart V, 48 FR 29112. June 24.1983; 49 
FR 22675, May 31,1984; 50 FR 14088, 
April 10.1985. 

Environmental Impact Statement 

This document has been reviewed in 
accordance with 7 CFR part 1940, 
subpart G, Environmental Program. It is 
the determination of FmHA that this 
action does not constitute a major 
Federal action significantly affecting the 
quality of the human environment, and 
in accordance with the National 
Environmental Policy Act of 1909, Public 
Law 91-190, an Environmental Impact 
Statement is not required. 

List of Subjects 

7 CFR Part 1922 

Rural housing, Loan programs— 
Housing and community development, 
Low and moderate income housing. 

7 CFR Part 1930 

Accounting, Administrative practice 
and procedure, Grant programs— 
Housing and community development. 
Loan programs—Housing and 
community development, Low and 
moderate income housing—Rental. 
Reporting requirements. 


7 CFR Part 1944 

Administrative practice and 
procedure. Aged, Handicapped, Loan 
programs—Housing and community 
development. Low and moderate income 
housing—Rental, Mobile homes. 
Mortgages. Nonprofit organizations, 

Rent subsidies. Therefore. FmHA 
amends chapter XVIII, title 7, Code of 
Federal Regulations as follows: 

PART 1922—APPRAISAL 

1. The authority citation for part 1922 
continues to read as follows: 

Authority: 42 U^.C. 1480; 5 U.S.C. 301; 7 
CFR 2.23; 7 CFR 2.70 

Subpart C—Appraisal of Single Family 
Residential Property 

2. The second sentence of 

§ 1922.104{a)(12j is amended by 
changing the reference from “Exhibit A" 
to “Exhibit D". 

PART 1930—GENERAL 

3. The authority citation for part 1930 
continues to read as follows: 

Authority: 42 (J.S.C. 1480; 5 U.3.C. 301; 7 
CFR 2.23; 7 CFR 2.70. 

\ 

Subpart C—Management and 
Supervision of Multiple Family Housing 
Borrowers and Grant Recipients 

4. Exhibit D paragraph VI A1 is 
amended by changing the reference from 
“Exhibit A" to “Exhibit D". 

5. Exhibit D-l, paragraph D. 1. is 
amended by changing the reference from 
“Exhibit A“ to “Exhibit D". 

PART 1944—HOUSING 

6. The authority citation for part 1944 
continues to read as follows: 

Authority: 42 US.G 1489; 5 U.S.G 301; 7 
CFR 2.23; 7 CFR 2.70. 

Subpart E—Rural Rental Housing Loan 
Policies, Procedures, and 
Authorizations 

§ 1944.222 [Amended) 

7. The third sentence of § 1944.222(a) 
is amended by changing the phrase “two 
or less" to read “less than four (4)", and 
the fourth sentence of § 1944.222 is 
amended by changing the phrase “more 
than two" to read "four (4) or more". 

Dated: July 25.1990. 

La Verne Ausmao. 

Administrator. Farmers Home 
Administration. 

(FR Doc. 90-20721 Filed 8-31-00; 8:45 am] 

BILLING COOC 3410-07-S 








35896 Federal Register / Vol. 55. No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


DEPARTMENT OF COMMERCE 

Bureau of Export Administration 

15 CFR Part 775 

[Docket No. 90G801-0201] 

Establishment of Import Certificate/ 
Delivery Verification Procedure for 
Sweden 

agency: Bureau of Export 
Administration, Commerce. 
action: Final rule. 

summary: The Bureau of Export 
Administration requires a foreign 
importer to file an Import Certificate (IC) 
in support of individual validated 
license applications to export certain 
commodities controlled for national 
security reasons to specified 
destinations. The commodities are 
identified by the code letter "A" 
following the Export Control Commodity 
Number on the Commodity Control List, 
which identifies those items subject to 
Department of Commerce export 
controls. By issuing an 1C, the 
government of the importing country 
undertakes to exercise legal control over 
the disposal of those commodities 
covered by the IC. 

The Bureau of Export Administration 
also requires a Delivery Verification 
Certificate (DV) on a selective basis, as 
described in 15 CFR 775.3(i). By issuing a 
DV, the government of a country to 
which an export has been made 
confirms that exported commodities 
have either entered the export 
jurisdiction of that country or are 
otherwise accounted for by the importer. 

New documentation practices adopted 
by Sweden warrant inclusion of that 
country in the IC/DV procedure. This 
rule amends the Export Administration 
Regulations by adding Sweden to the 
list of countries that issue Import 
Certificates and by adding the names 
and addresses of the Swedish 
authorities to the list of foreign offices 
lhat administer the IC/DV systems. 

In the past, BXA has required letters 
of assurance on an ad hoc basis from 
Swedish customers importing goods for 
resale. This new IC/DV procedure 
replaces the letter of assurance 
requirement. 

EFFECTIVE dates: This rule is effective 
September 4, 1990. In lieu of the 45 day 
grace period provided in 15 CFR 
775.9(b)(2), the Swedish Import 
Certificate must be submitted with 
export license applications as of March 
14,1990. In the interim, applications will 
be accepted if supported by either a 
Form BXA--629P (Statement By Ultimate 


Consignee and Purchaser) or the 
Swedish IC. 

FOR FURTHER INFORMATION CONTACT: 

Patricia Muldonian, Office of 
Technology and Policy Analysis, Bureau 
of Export Administration, Telephone: 
(202) 377-2440. 

SUPPLEMENTARY INFORMATION: 

Rulemaking Requirements 

1. This rule is consistent with 
Executive Orders 12291 and 12661. 

2. This rule eliminates a collection of 
information subject to the Paperwork 
Reduction Act of 1900 (44 U.S.C. 3501 et 
seq.]. This collection had been approved 
by the Office of Management and 
Budget under control number 0694-0062. 
As a result of this rule, there will be an 
increase in the number of Delivery 
Verification Certificates, Form BXA- 
647P, approved by OMB under control 
number 0694-0018 and a decrease of 
Statements by Ultimate Consignee and 
Purchaser, approved under OMB control 
number 0694-0021). 

3. This rule does not contain policies 
with Federalism implications sufficient 
to warrant preparation of a Federalism 
assessment under Executive Order 
12612. 

4. Because a notice of proposed 
rulemaking and an opportunity for 
public comment are not required to be 
given for this rule by section 553 of the 
Administrative Procedure Act (5 U.S.C. 
553) or by any other law, under sections 
603(a) and 604(a) of the Regulatory 
Flexibility Act (5 U.S.C. 603(a) and 
604(a)) no initial or final Regulatory 
Flexibility Analysis has to be or will be 
prepared. 

5. Section 13(a) of the Export 
Administration Act of 1979, as amended 
(EAA) (50 U.S.C. app. 2412(a)), exempts 
this rule from all requirements of section 
553 of the Administrative Procedure Act 
(APA) (5 U.S.C. 553), including those 
requiring publication of a notice of 
proposed rulemaking, an opportunity for 
public comment, and a delay in effective 
date. This rule is also exempt from these 
APA requirements because it involves a 
foreign and military affairs function of 
the United States. Section 13(b) of the 
EAA does not require this rule be 
published in proposed form because this 
rule does not impose a new control. 
Further, no other law requires that a 
notice of proposed rulemaking and an 
opportunity for public comment be given 
for this rule. 

Therefore, this regulation is issued in 
final form. Although there is no formal 
comment period, public comments on 
this regulation are welcome on a 
continuing basis. Comments should be 
submitted to Patricia Muldonian, Office 


of Technology and Policy Analysis. 
Bureau of Export Administration, 
Department of Commerce, P.O. Box 273. 
Washington, DC 20044. 

List of Subjects in 15 CFR Part 775 

Exports, Reporting and recordkeeping 
requirements. 

Accordingly, part 775 of the Export 
Administration Regulations is amended 
as follows: 

PART 775—[AMENDED] 

1. The authority citation for 15 CFR 
part 775 continues to read as follows: 

Authority: Pub. L 96-72. 93 Stat. 503 (50 
U.S.C. app. 2401 et seq.], as amended by Pub. 
L 97-145 of December 29,1931, Pub. L 99-64 
of July 12.1985 and Pub. L 100-418 of August 
23,1988: E.0.12525 of July 12,1985 (50 FR 
28757, July 16,1985): Pub. L. 95-223 of 
December 28.1977 (50 U.S.C. 1701 et seq.]; 
E.0.12532 of September 9,1985 (50 FR 36861. 
September 10,1985) as affected by notice of 
September 4,1906 (51 FR 31925, September 8, 
1986): Pub. L 99-440 of October 2,1986 (22 
U.S.C. 5001 et seq.]; and E.0.12571 of 
October 27,1986 (51 FR 39505, October 29. 
1986). 

§775.1 [Amended) 

2. The table in § 775.1 is amended by 
adding “Sweden” before the entry 
"Turkey” in the column title “and the 
country of destination is”. 

§775.3 (Amended 1 

3. The list of countries in § 775.3(b)(3) 
is amended by adding "Sweden” before 
the entry “Turkey”. 

4. Supplement No. 1 to part 775 is 
amended by adding a new entry for 
"Sweden” immediately before the entry 
for "Switzerland”, as follows: 

Supplement No. 1 to Part 775 Authorities 
Administering Lmport Certificates/ 
Delivery Verification Systems in Foreign 
Countries 1 

* « « • • 


1 Facsimiles of Import Certificates and Delivery 
Verifications issued by each of these countries may 
be inspected at the Bureau of Export Administration 
Western Regional Office, 3300 Irvine Avenue, Suite 
345, Newport Beach. California 92660-3198 or at any 
U.S. Department of Commerce District Office (see 
listing on page ii under Commerce Office 
Addresses) or at the Office of Export Licensing. 
Room 1099D. U.S. Department of Commerce. 14th 
Street and Pennsylvania Avenue, NW.. Washington. 
DC 20230. 








Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Rules and Regulations 35897 


Country 

IC/DV authorities 

System 
adminis¬ 
tered 2 

Sweden. 

The Association of Swedish 
Chambers, of Commerce 
and Industry, P.O. Box 
16050, S-103 22, Stock- 
holm Office: Vastra Trad- 
gardsgatah 9. 

IC/DV. 


* 1C—Import Certificate and/or DV—Delivery Veri¬ 
fication. 


Doted: August 28.1990. 

Michael P. Galvin, 

Assistant Secretary for Export 
A dministration. 

[FR Doc. 90-20644 Filed 8-31-90: 8:45 am) 

BILLING CODE 3510-OT-M 


COMMODITY FUTURES TRADING 
COMMISSION 

17CFR Part 140 

Delegation of Authority To Determine 
To Publish Exchange Rule 
Amendments 

agency: Commodity Futures Trading 

Commission. 

action: Final rule. 

summary: The Commission is amending 
part 140 of its rules by adding a 
provision delegating to the Director of 
the Division of Economic Analysis, and 
to the Director of the Division of Trading 
and Markets, with the concurrence of 
the General Counsel, authority to 
publish in the Federal Register for public 
comment proposed exchange rule 
amendments when publication of the 
proposed rule amendment is in the 
public interest and will assist the 
Commission in considering the views of 
interested persons. The Commission’s 
action relates solely to agency 
organization, procedure and practice. 
EFFECTIVE DATE: September 4.1990. 

FOR FURTHER INFORMATION CONTACT: 
John C. Lawton, Associate Director, 
Division of Trading and Markets, 
Commodity Futures Trading 
Commission, 2033 K Street, NW„ 
Washington, DC 20581. Telephone (202) 
254-8955. 

SUPPLEMENTARY INFORMATION: The 

Commission publishes notice of all 
exchange rule amendments of major 
economic significance pursuant to the 
provisions of section 5a(12) of the 
Commodity Exchange Act. Since 
November 1985, authority to determine 
to publish such amendments has been 
delegated to the Director of the Division 
of Economic Analysis. 17 CFR 
140.96(1989). The Commission has also 
published, on occasion, other proposed 


exchange rule amendments when 
publication of the proposed rule 
amendment was in the public interest 
and would assist the Commission in 
considering the views of interested 
persons. 

To streamline internal procedures, the 
Commission is amending part 140 of its 
rules by amending $ 140.96. New 
paragraph (b) delegates to the Director 
of the Division of Economic Analysis, or 
the Director’s designee, and to the 
Director of the Division of Trading and 
Markets, or the Director’s designee, with 
the concurrence of the General Counsel, 
or the General Counsel's designee, the 
authority to decide to publish, and to 
publish, proposed exchange rule 
amendments in the Federal Register 
when publication of the proposed rule 
amendment would be in the public 
interest and would assist the 
Commission in considering the views of 
interested persons. 

Paragraphs (b) and (c) of S 140.96 are 
redesignated as paragraphs (c) and (d). 
New paragraph (c) has been revised to 
provide that the Director of the Division 
of Economic Analysis or the Director of 
the Division of Trading and Markets 
may submit any matter which has been 
delegated to such Director under 
paragraphs (a) or (b) of this section to 
the Commission for its consideration. 
New paragraph (d) has been revised to 
provide that nothing in the section may 
prohibit the Commission from exercising 
the authority delegated to the Director of 
the Division of Economic Analysis and 
to the Director of the Division of Trading 
and Markets under paragraphs (a) and 
(b) of this section. The Commission 
believes that this delegation of authority 
will further its goal of streamlining 
exchange rule review procedures. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act, 5 
U.S.C. 601 et seq., requires agencies to 
consider the impact of proposed rules on 
small entities. It is not anticipated that 
these new regulations, which deal solely 
with internal rules governing 
Commodity Futures Trading 
Commission procedures, will impose 
any new burden on small entities. 
Accordingly, the Chairman, on behalf of 
the Commission, hereby certifies 
pursuant to 5 U.S.C. 605(b) that the rule 
promulgated herein will not have a 
significant economic impact on a 
substantial number of small entities. 

Paperwork Reduction Act 

The rule adopted herein does not 
contain a collection of information 
requirement, nor an “information 
collection request” within the meaning 
of 44 U.S.C. 3502(4), and relates solely to 


CFTC management and personnel. 
Therefore, the Commission has 
determined that the provisions of the 
Paperwork Reduction Act do not apply 
to this rule. 

Waiver of Public Notice and Comment 

The following regulations shall be 
effective immediately. The Commission 
finds that the amendments relate solely 
to agency organization, practice and 
procedure and that the public 
procedures and publication prior to the 
effective date of the amendments, in 
accordance with the Administrative 
Procedure Act. as codified. 5 U.S.C. 553, 
are not required. 

List of Subjects in 17 CFR Part 140 

Authority delegations (Government 
agencies), Delegation, Exchange rule 
amendments. Organization and 
functions (Government agencies). 

In consideration of the foregoing, and 
pursuant to the authority contained in 
the Commodity Exchange Act, and in 
particular, sections 2(a)(ll) and 5a(12) of 
the Commodity Exchange Act, 7 U.S.C. 
4a(j) and 7a(12), the Commission hereby 
amends Chapter I of title 17 of the Code 
of Federal Regulation as follows: 

PART 140—ORGANIZATION, 
FUNCTIONS, AND PROCEDURES OF 
THE COMMISSION 

1. The authority citation for part 140, 
continues to read as follows: 

Authority: 7 U.S.C. 4a(j), 7. 7a(12) and 8. 

2. In S 140.96, paragraphs (b) and (c) 
are redesignated as paragraphs (c) and 
(d) and revised, and new paragraph (b) 
is added to read as follows: 

§ 140.96 Delegation of authority to publish 
In the Federal Register. 

« • * * • 

(b) The Commodity Futures Trading 
Commission hereby delgates, until such 
time as the Commission orders 
otherwise, to the Director of the Division 
of Economic Analysis or the Director’s 
designee, and to the Director of the 
Division of Trading and Markets or the 
Director's designee, with the 
concurrence of the General Counsel or 
the General Counsel's designee, the 
authority to determine to publish, and to 
publish, in the Federal Register, requests 
for public comment on proposed 
exchange rule amendments when 
publication of the proposed rule 
amendment is in the public interest and 
will assist the Commission in 
considering the views of interested 
persons. 

(c) The Director of the Division of 
Economic Analysis or the Director of the 














35S93 Federal Register / Vol, 55, No> 171 / Tuesday, September 4, 1990 / Rules and Regulations 


Division of Training and Markets may 
submit any matter which has been 
delegated to such Director under 
paragraphs (a) op (b) of this section to 
the Commission for its consideration, 
(d) Nothing in this section may 
prohibit the Commission, at its election, 
from exercising the authority delegated 
to the Director of the Division of 
Economic Analysis and to the Director 
of the Division of Trading and Markets 
under paragraphs (a) and (b) of this 
section. 

Issued ttt Washington. DC. on August 28, 
1990 by the Gommssion. 

Jean A. Webb. 

Secretory of the Commission. 

|FR Doc. 90-20708Fifed B-31-9G;8:45 »m| 

BILLING COOC fittl-at-M 


INTERNATIONAL BOUNDARY AND 
WATER COMMISSION 

22 CFR Part 1102 

United States end Mexico, United 
States Section, Freedom of 
Information Act Uniform Fee Schedule 
and Administrative Guidalfnes 

AGENCY: United States Section, 
International Boundary and Water 
Commission. 
action: Final rule. 

SUMMARY! This final rule revises the 
United States Section, International 
Boundary' and Water Commission 
(IBWC) regulations to implement the 
provisions of the Freedom of 
Information Reform Act of 1938. This 
legislation amended the FOIA to provide 
broader exemption protection for law 
enforcement information and modified 
the Act r 8 fee and fee waiver provisions. 
IBWC*8 regulations are aTso revised to 
conform with the Office of Management 
and Budget's final fee schedule 
guidelines published in the Federal 
Register on March 27,1967 (52 FR 
10012), and fee waiver criteria 
established by the Department of 
Justice. 

effective dates: This rufe is effective 
September 3* 1990. 

ADDRESSES! United States Section 
International Boundary and Water 
Commission, 4171 North Mesa, Suite C- 
310. El Paso, TX 79902-1422. 

FOR FURTHER INFORMATION CONTACT: 

Mr. Reinaldo Martinez, ULS. Section 
Freedom of information Act (FOIA} 
Officer. (915-634-6674). 

SUPPLEMENTARY INFORMATION! On July 
11,1990; the United States Section*. 
IBWC, published this agency's FOLA 
proposed rules in the Federal Register 


(55 FR 28407). The comment period was 
from date of publication to August 10, 
1930. No formal comments were 
received at this agency, therefore rules 
remain as published in the fdy 1L 1990 
Federal Register, with the exception of 
the definitions which have been placed 
in alphabetical order. 

List of Subjects in 22 CFR Part 1102 
Freedom of information. 

22 CFR part 1102 is revised as follows; 

PART 1102—FREEDOM OF 
INFORMATION ACT 

Sec. 

1102T Purpose. 

1102.2 Definitions. 

1102.3 Procedures for requesting access to 
records or information. 

1102.4 Fees. 

1102.5 Categories of requesters for fee 
purposes. 

11026 Fee waivers and appeals. 

1102.7 The Section’s determination and 
appeal procedures. 

1182.8 Exemptions. 

1J02.9 Annual report lo Congress. 

110210 Examination of records. 

Authority: 5 U.S.C. 552 fPub. L 90-23. as 
amended by Pub. L 93-502 and 98-570). 

§11021 Purpose. 

The purpose of this part is to prescribe 
rules, guidelines and procedures to 
implement the Freedom of Information 
Act (FQ1A), 5 U.S.C. 552, as amended on 
November 21,1974, by Public Law 93- 
502, and on October 27 r 1986, by Public 
Law 99-570i 

§ 11022 Definitions. 

Act means the Freedom of Information 
Act 5 U.S.C. 552, as amended. 

Commercial-use request refers lo a 
request from or on behalf of one who 
seeks information for a cause or purpose 
that furthers the commercial trade, or 
profit interests of the requester or 
person on whose behalf the request is 
made. In determining whether a 
requester properly belongs in this 
category, die Section wiH consider how 
the requester will use the documents. 

Commissioner means head of the 
United States Section, International 
Boundary and Water Commission, 
United States and Mexico. 

Direct costs means those expenditures 
which the Section actually incurs in 
searching for and duplicating (and in the 
case of commercial requesters, 
reviewing) documents to respond to a 
FOIA request. Direct costs Hicude, for 
example, the salary of the employee 
performing work (the basic rate of pay 
for the employee plus 16 percent of that 
rate to cover benefits) and die cost of 
operating duplicating machinery. Not 
included hi direct costs are overhead 


expenses such as costs of space, and 
heating or lighting the facility where the 
records are stored. 

Disclose or disclosure means making 
records available, on request for 
examination and copying, or furnishing 
a copy of records. 

Duplication refers to the process of 
making a copy of a document in 
response to a FOIA request. Such copies 
can take the form of paper, microform, 
audiovisual materials, or machine- 
readable documentation. The Section 
will provide a copy of the material in a 
form that is usable by the requester 
unless it is administratively burdensome 
to do so. 

Educational institution refers to a 
preschool a public or private 
elementary or secondary school, an 
institution of graduate higher education* 
an institution of undergraduate higher 
education, an institution of professional 
education, and an institution of 
vocational education, which operates » 
program or programs of scholarly 
research. 

Noncommercial scientific institutioji 
refers to an institution that is not 
operated on a “commercial" basis as 
that term is referenced above, and 
which is operated solely for the purpose 
of conducting scientific research the 
results of which are not intended to 
promote any particular product or 
industry. 

Person or Requester includes any 
individual firm, corporation* 
organization or other entity. 

Records and/or information are 
defined as all books,, papers, manuals,. 
map9, photographs, or other 
documentary materials,, regardless of 
physical form or characteristics, made 
or received by the Section under Federal 
law or in connection with the 
transaction of public business or in 
carrying out its freaty responsibilities 
and obligations, and preserved or 
appropriate for preservation by the 
Section as evidence of the organization, 
functions, policies, decisions, 
procedures, operations, or other 
activities of the Government orbecaose 
of the information value of the data in 
them, but does not include books, 
magazines of other material acquired 
9olely for library purposes and through- 
other sources, and does not include 
analyses, computations, or compilations 
of information not extant at the time of 
the request. The Vena "teeorda” does not 
include objects or articles such as 
structures, furniture, paintings, 
sculptures, three-dimensionot models, 
vehicles, and equipment. 

Representative of the news media 
refers to any person actively gathering 
















Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35899 


news for an entity that is organized and 
operated to publish or broadcast news 
to the public. The term "news" means 
information that is about current events 
or that would be of current interest to 
the public. Examples of news media 
include television or radio stations 
broadcasting to the public at large, and 
publishers of periodicals (but only those 
instances when they can qualify as 
disseminators of “news”) who make 
their products available for purchase or 
subscription by the general public. In the 
case of “freelance” journalists, they may 
be regarded as working for a news 
organization if they can demonstate a 
solid basis for expecting publication 
through that organization even though 
not actually employed by it. 

Request means a letter or other 
written communication seeking records 
or information under the Freedom of 
Information Act. 

Review refers to the process of 
examining documents located in 
response to a request that is for 
commercial use to determine if any 
portion of that document is permitted to 
be withheld, and processing any 
document for disclosure (i.e., doing all 
that is necessary to excise them and 
otherwise prepare them for release). It 
does not include time spent resolving 
general legal or policy issues regarding 
the application of exemptions. 

Search includes all time spent looking 
for material that is responsive to a 
request, including page-by-page or line- 
by-line identification of material within 
documents. Searches should be 
performed in the most efficient and least 
expensive manner so as to minimize 
costs for both the Section and the 
requester; for example, line-by-line 
searches should not be undertaken 
when it would be more efficient to 
duplicate the entire document. Note that 
such activity should be distinguished 
from “review” of material in 
determining whether the material is 
exempt from disclosure. Searches may 
be done manually or by computer using 
existing programming. 

The Section means United States 
Section, International Boundary and 
Water Commission, United States and 
Mexico. 

All terms used in this part which are 
defined in 5 U.S.C. 552 shall have the 
same meaning herein. 

§ 1102.3 Procedures for requesting 
access to records or information. 

(a) A request for any information or 
records shall be addressed to the FOIA 
Officer, United States Section, 
International Boundary and Water 
Commission, 4171 North Mesa, suite 
C-310. El Paso, TX 79902-1422. The 


envelope and the letter shall be clearly 
marked “Freedom of Information 
Request” or “Request for Records,” or 
the equivalent, to distinguish it from 
other mail to the Section. If the request 
is not so marked and addressed, the 10- 
day time limit described in the Act will 
not begin to run until the request has 
been received by the FOIA Officer in the 
normal course of business. In each 
instance where a request is received in 
the normal course of business, the FOIA 
Officer shall notify the requester that its 
request was improperly addressed and 
the date the request was received. 

(b) In order for the Section to locate 
records or information and make them 
available, it is necessary that it be able 
to identify the specific record or 
information sought. Persons wishing to 
inspect or obtain copies of records or 
information should, therefore, seek to 
identify them as fully and accurately os 
possible. In cases where requests are 
submitted which are not sufficient to 
permit identification, the FOIA Officer 
will endeavor to assist the persons 
seeking the records or information in 
filling in necessary details. In most 
cases, however, persons seeking records 
or information will find that time taken 
in trying to identify materials in the 
beginning is well worth their while in 
enabling the Section to respond 
promptly to their request. 

(c) A person submitting a request 
should— 

(1) Indicate the specific event or 
action, if any or if known, to which the 
request has reference. 

(2) Designate the Division, Branch, or 
Project Office of the Section which may 
be responsible for or may have 
produced the record or information 
requested. 

(3) Furnish the date of the record or 
information or the date or period to 
which it refers or relates, if known. 

(4) Name the character of record or 
information, such as a contract, an 
application, or a report. 

(5) List the Section’s personnel who 
may have prepared or have knowledge 
of the record or information. 

(6) Furnish the reference material such 
as newspapers or publications which 
are known to have made a reference to 
the record or information desired. 

(7) If the request relates to a matter in 
pending litigation or one which has been 
litigated, supply the Court location and 
case style and number. 

(8) Describe, when the request 
includes more than one record or source 
of information, specifically each record 
or information so that availability may 
be separately determined. 

(9) Clearly indicate whether the 
request is an initial request or an appeal 


from a denial of a record or information 
previously requested. 

(10) Identify, when the request 
concerns a matter about the Section’s 
personnel, the person as follows: First 
name, middle name or initial, and 
surname; date and place of birth; and 
social security account number, if 
known. 

(d) No particular format is needed for 
the request, except that it: 

(1) Must be in writing; 

(2) Must describe the records or 
information sought with sufficient detail 
to permit identification; 

(3) Should state a limitation of the fees 
the requester is willing to pay. if any; 
and 

(4) Must include the name, address, 
and telephone number (optional) of the 
person submitting the request. 

§1102.4 Fees. 

(a) The following shall be applicable 
with respect to services rendered to 
members of the public under this 
subpart: 

(1) Fee schedule. 

(i) Searching for records, per hour or 
fraction thereof per individual: 


Professional.$18.00 

Clerical...-.$9.00 


Includes the salary of the category of 
employee who actually performs the search, 
plus an additional 16% of that rate to cover 
benefits. 

(ii) The cost for computer searches 
will be calculated based on the salary of 
the category of employee who actually 
performs the computer search, plus 16% 
of that rate to cover benefits, plus the 
direct costs of the central processing 
unit, input-output devices, and memory 
capacity of the actual computer 
configuration. 

(iii) Reproduction fees: 

Pages no larger than 8 Vi by 14 inches when 
reproduced by routine electrostatic copying: 
$0.10 per page. 

Pages requiring reduction, enlargement, or 
other special services will be billed at direct 
cost to the Section. 

Reproduction by other than routine 
electrostatic copying will be billed at direct 
cost to the Section. 

(iv) Certification of each record as a 
true copy—$1.00 

(v) Certification of each record as a 
true copy under official seal—$1.50 

(vi) For each signed statement of 
negative result of search for record— 
$ 1.00 

(vii) For each signed statement of 
nonavailability of record—$1.00 

(viii) Duplication of architectural 
photographs and drawings: 

Available tracing or reproducible, per 











.15900 Federal Register / VoL 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


square hot _$0.10 

If intermediate nagative and 

reproducible required-$2i»; 

Plus tracing per square foot_ $1.00 

(ix) Postage and handling. It will be up 
to the person requesting the records or 
information to designate how the 
material will be mailed or shipped In 
the absence of such instructions no 
records or information wiU be sent to a 
foreign address, and records and 
information will be sent to domestic 
addresses utilizing fust class certified 
mail. return receipt requested and will 
be billed at direct cost to the Section. 

(21 Only requesters who are seeking 
documents for commercial use will be 
charged for time spent reviewing 
records to determine whether thay are 
exempt from mandatory disclosure. The 
cost for review will be calculated based 
on the salary of the category of the 
employee who actually performed the 
review plus 16% of the rate to cover 
benefits. Charges wilt be assessed onfy 
for the initial review (i.e., review 
undertaken the first time in order to 
analyze the applicability of specific 
exemption(s) to a particular record or 
portion of record} and not review at the 
administrative appeal level of the 
rxemptlon(s) already applied. 

(3) if records requested under this part 
are stored elsewhere than the 
headquarters of the U.S. Section, IBWC* 
4171 North Mesa, EL Paso, TX. the 
special cost of returning such records to 
the headquarters shall be include in the 
search costs. These costs will be 
computed at the actual costs of 
transportation of either a person or the 
requested record between the place 
where the record is stored and the 
Section headquarters when, for lime or 
other reasons, it is not feasible to rely on 
Government mail service. 

(4) When no specific fee has been 
established for a service, or the request 
for a service does not fall under one of 
the above categories due to the amount 
or size or type thereof, the FOIA Officer 
is authorized to establish an appropriate 
fee, pursuant to the criteria established 
in Office of Management and Budget 
Circular No* A-25, entitled “User 
Charges.'* 

(b) Where it is anticipated that the 
fees chargeable under this part wiH 
amount to more than $25 and die 
requester has not indicated fr> advance 
her/his willingness to pay fees as high 
as anticipated, the requester shaft be 
promptly notified of the amount of the 
anticipated fees or such portion thereof 
as can readily be estimated. The notice 
or request for an advance deposit shall 
extend an offer to the requester to 
confer with knowledgeable Section 
personnel in an attempt to reformulate 


the request in a manner which will 
reduce the fees and meet the needs of 
the requester. Dispatch of such notice or 
request shall suspend the running of the 
period for response by the Section until 
a reply is received from the requester. 

(c) Search costs are due and payable 
even if the record which was requested 
cannot be located after all reasonable 
efforts have been made, or if the Section 
determines that a record which has been 
requested, but which is exempt from 
disclosure under this part, is to be 
withheld. 

(d) The Section will begin assessing 
interest charges on an* unpaid bill 
starting the 31st day following the day 
on which the billing was sent. The 
accrual of interest will be stayed upon 
receipt of the fee. rather than upon its 
processing by the Section. Interest will 
at the rate precribed in section 3717 of 
title 31 U.S.C. 

(e) A requester may not file multiple 
requests at the same time, each seeking 
portions of a document or documents, 
solely in order to avoid payment of fees. 
When the Section reasonably believes 
that a requester or a group of requesters 
acting in concert is attempting to break 
a request down into a series of requests 
for the purpose of evading the 
assessment of fees, the Section will 
aggregate any such requests and charge 
accordingly. 

(f) The Section will not require a 
requester to make an advance payment, 
i.e., payment before work is commenced 
or continued on a request, unless: 

(1) The Section estimates or 
determines that allowable charges that a 
requester may be required to pay are 
likely to exceed $250. Then the Section 
will notify the requester of the likely 
costs and obtain satisfactory assurance 
of full payment w here the requester has 
a history of prompt payment of FOIA 
fees, or require an advance payment of 
an amount up to the full estimated 
charges in the case of requesters with no 
history of payment; or 

(2) Requesters who have previously 
failed to pay fees charged in a timely 
fashion (he* within 30 days of the date 
of the billingl, the Section will require 
such requesters to pay the full amount 
owed plus any applicable interest as 
provided above or demonstrate that 
they have, in fact, paid the fee. and to 
make an advance payment of the full 
amount of the estimated fee before the 
agency begins to process new requests 
or pending requests from such 
requesters. 

When the Section acts under paragraph 
(f) (1) or (2) of this section, the 
administrative time limit prescribed in 
subsection (a)(6l of the FOLA (he* 10 


working days from receipt of initial 
requests plus permissible extensions of 
that time limit) will begin only after the 
Section has received payments 
described above. 

(g) In accordance with the provisions 
and authorities of the Debt Collection 
Act of 1982 (Pub. L. 97-365}, the Section 
reserves the right to disclose 
information to consumer reporting 
agencies and to use collection agencies, 
where appropriate, to encourage 
repayment. 

(h) No Fees under $10 will be billed by 
the Section because the cost of 
collection would be greater than the fee: 

(i) Requester should pay fees by check 
or money order made out to the U.S. 
Section, International Boundary and 
Water Commission, and mailed to the 
Finance and Accounting Office, United 
States Section, International Boundary 
and Water Commission, 4171 North 
Mesa, suite C-310. El Paso, TX 79902- 
1422. 

§ 1102.5 Categories of requesters for fee 
purposes. 

There are four categories of 
requesters: Commercial use requesters; 
educational and non-commercial 
scientific institutions; representatives of 
the news media; and all other 
requesters. The Act prescribes specific 
levels of fees for each of these 
categories. The Section will take into 
account information provided by 
requesters in determining their eligibility 
for inclusion in one of these categories is 
as defined in § 1102.2. It is in the 
requester's best interest to provide os 
much information as possible to 
demonstrate inclusion within a non¬ 
commercial category of fee treatment. 

(a) The Section wiU assess charges 
which recover the full direct costs of 
searching for, reviewing for release, and 
duplicating the records sought for 
commercial use. Commercial use 
requesters are entitled to neither two 
hours of free search time nor 100 free 
pages of reproduction of documents.. 

(b) The Section will provide 
documents to educational and non¬ 
commercial scientific institutions for the 
cost of reproduction alone, excluding 
charges for the First 100 pages. To be 
eligible for inclusion in this category, 
requesters must show that the request 
being made is authorized by. and under 
the auspices of, a qualifying Institution 
and that the records are not sought for a 
commercial use, but are sought in 
furtherance of scholarly {if the request is 
from an educational institution) or 
scientific (if the request is from a non¬ 
commercial scientific institution) 
research. 








Federal Register / Vol. 55. No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35901 


(c) The Section will provide 
documents to representatives of the 
news media for the cost of reproduction 
alone* excluding charges for the first 100 
pages. To be eligible for inclusion in this 
categoiy; a requester must meet the 
criteria in $ 1102.2(m). and the request 
must not be made for a commercial use. 
In reference to this class of requesters, a 
request for records supporting the news 
dissemination function of the requester 
shall not be considered to be a request 
that is for a commercial use. 

(d) The Section will charge requesters 
who do not fit into any of the categories 
above fees which recover the full 
reasonable direct cost of searching for 
and reproducing records that are 
responsive to the request, except that 
the first 100 pages of reproduction and 
the first two hours of search time shall 
be furnished without charge. Moreover, 
requests from record subjects for 
records about themselves will continue 
to be treated under the fee provisions of 
the Privacy Act of 1974 which permit 
fees only for reproduction. 

(e) In making determinations under 
this section, the Section may take into 
account whether requesters who 
previously were granted (b), (c). or (d) 
status under the Act did in fact use the 
requested records for purposes 
compatible with the status accorded 
them. 

§ 1102.6 Fee waivers and appeals. 

(a) Waiver or reduction of any fee 
provided for in 5 1102.4 may be made 
upon a determination by the FOIA 
Officer, United States Section* 
International Boundary and Water 
Commission. 4171 North Mesa, suite O 
310, El Paso. TX 79902-1422. The Section 
shall furnish documents without charge 
or at a reduced charge provided that: 
Disclosure of the information is in the 
public interest because it is likely to 
contribute significantly to public 
understanding of the operations or 
activities of the Government and is not 
primarily in the commercial interest of 
the requester. Requests for a waiver or 
reduction of fees shall be considered on 
a case-by-case basis. 

(1) In order to determine whether 
disclosure of the information is in the 
public interest because it is likely to 
contribute significantly to public 
understanding of the operations or 
activities of the Government* the Section 
will consider the following four factors: 

(i) The subject of the request: Whether 
the subject of the requested records 
concerns the operations or activities of 
the Government; 

(ii) The informative value of the 
information to be disclosed: Whether 
the disclosure is likely to contribute to 


an understanding of Government 
operations or activities; 

(iii) The contribution to an 
understanding of the subject by the 
general public likely to result from 
disclosure: Whether disclosure of the 
requested information will contribute to 
public understanding; and 

(iv) The significance of the 
contribution to public understanding: 
Whether the disclosure is likely to 
contribute significantly to public 
understanding of Government 
operations or activities. 

(2) in order to determine whether 
disclosure of the information is not 
primarily in the commercial interest of 
the requester, the Section will consider 
the following two factors: 

(1) The existence and magnitude of a 
commercial interest: Whether the 
requester has a commercial interest that 
would be furthered by the requested 
disclosure; and, if so 

(ii) The primary interest in disclosure: 
Whether the magnitude of the identified 
commercial interest of the requester is 
sufficiently large, in comparison with 
the public interest in disclosure, that 
disclosure is primarily in the commercial 
interest of the requester. 

(b) The Section will not consider 
waiver or reduction of fees for 
requesters (persons or organizations) 
from whom unpaid fees remain due to 
the Section for another information 
access request 

(c) (1) The Section’s decision to refuse 
to waive or reduce fees as requested 
under paragraph (a) of this section may 
be appealed to the Commissioner, 

United States Section, international 
Boundary and Water Commission. 4171 
North Mesa, Suite C-^310, El Paso, TX 
79902-1422. Appeals should contain a 9 
much information and documentation as 
possible to support the request for a 
waiver or reduction of fees. 

(2) Appeals will be reviewed by the 
Commissioner, who may consult with 
other officials of the Section as 
appropriate. The requester will be 
notified within thirty working days from 
the date on which the Section received 
the appeal. 

§ 1102.7 Tho Section's determination and 
appeal procedures. 

Upon receipt of any request for 
records of information under the Act the 
following guidelines shall be followed: 

(a) The FOIA Officer will determine 
within 10 days (excepting Saturdays, 
Sundays, and legal holidays) after 
receipt of any such request whether to 
comply with such request and will 
immediately notify the person making 
such request of such determination, the 
reasons therefore, and of the right to 


such person to appeal to the 
Commissioner any adverse 
determination. 

(b) All appeals should be addressed to 
the Commissioner, United States 
Section, International Boundary and 
Water Commission, 4171 North Mesa, 
Suite. C-310. El Paso, TX 79902-1422, 
and should be clearly identified as such 
on the envelope and in the letter of 
appeal by using the marking “Freedom 
of Information Appeal” or “Appeal for 
Records” or the equivalent. Failure to 
properly address an appeal may defer 
the date of receipt by the Section to take 
into account the time reasonably 
required to forward the appeal to the 
Commissioner. In each instance when 
an appeal is incorrectly addressed to the 
Commissioner, he shall notify the person 
making the appeal that his appeal was 
improperly addressed and of the date 
the appeal was received by the 
Commissioner. The Commissioner will 
make a determination with respect to 
any appeal within 20 days (excepting 
Saturdays, Sundays, and legal holidays) 
after the receipt of an appeal. If on 
appeal the denial or the request is in 
whole or in part upheld, the 
Commissioner will notify the person 
making such request of the provisions 
for judicial review under the Act An 
appeal must be in writing and filed 
within 30 days from receipt of the initial 
determination (in cases of denials of an 
entire request), or from receipt of any 
records being made available pursuant 
to the initial determination (in case of 
partial denials), in those cases where a 
request or appeal is not addressed to the 
proper official the time limitations 
stated above will be computed from the 
receipt of the request or appeal by the 
proper official. 

(c) In unusual circumstances, as set 
forth in paragraph (d) of this section, the 
time limits for responding to the original 
request or the appeal may be extended 
by not more than an additional 10 
working days by written notice to the 
person making a request. This notice 
must be sent within either 10- or 20-day 
time limit and will specify the reason for 
the extension and the date on which 
determination is expected to be 
dispatched. The extension may be 
invoked only once during the 
consideration of a request either during 
the initial consideration period or during 
the consideration of an appeal but not 
both. 

(d) The unusual circumstances are: 

(1) The need to search for and collect 

the requested records from field 
facilities or other establishments that 
are separate from the office processing 
the request. 










35902 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


(2) The need to search for, collect, and 
appropriately examine a voluminous 
amount of separate and distinct records 
which are demanded in a single request; 
or 

(3) The need for consultation, which 
shall be conducted with all practicable 
speed, with another agency having a 
substantial interest in the determination 
of the requestor among two or more 
components of the agency having 
substantial subject-matter interest 
therein. 

(e) If the FOIA Officer receives a 
request which is of proper concern to an 
agency or entity outside the Section, it 
will be returned to the person making 
the request, advising the requester to 
refer it to the appropriate agency or 
entity if requester desires, and providing 
the requester with the name or title, 
address and other appropriate 
information. An information copy of the 
request and the letter of referral will be 
forwarded promptly to the agency or 
entity outside the Section that may 
expect the request. In the event the 
FOIA Officer receives a request to make 
available a record or provide 
information which is of interest to more 
than one agency (Federal, State, 
municipal, or legal entity created 
thereby), the FOIA Officer will retain 
and act upon the request if the Section is 
one of the interest agencies and if its 
interest in the record is paramount. 

(f) The Commissioner’s determination 
on an appeal shall be in writing and 
when it denies records in whole or in 
part, the letter to the person making a 
request shall include: 

(1) Notation of the specific exemption 
or exemptions of the Act authorizing the 
withholding. 

(2) A statement that the decision is 
final for the Section. 

(3) Advice that judicial review of the 
denial is available in the district in 
which the person making the request 
resides or has his principal place of 
business, the district in which the 
Section's records are situated, or the 
District of Columbia. 

(4) The names and titles or positions 
of each official responsible for the 
denial of a request. 

When appropriate, the written 
determination may also state how an 
exemption applied in that particular 
case, and, when relevant, why a 
discretionary rebase is not appropriate. 

(g) In those cases where it is 
necessary to find and examine records 
before the legality or appropriateness of 
their disclosure can be determined, and 
where after diligent effort this has not 
been achieved within the required 
period, the FOIA Officer may advise the 


person making the request that a 
determination to presently deny the 
request has been made because the 
records or information have not been 
found or examined, that the 
determination will be considered when 
the search or examination is completed 
and the time within which completion is 
expected, but that the person making the 
request may immediately file an 
administrative appeal to the 
Commissioner. 

§1102.8 Exemptions. 

(а) 5 U.S.C. 552(b) provides that the 
requirements of the FOIA do not apply 
to matters that are: 

(1) Classified Documents: Specifically 
authorized under criteria established by 
an Executive order to be kept secret in 
the interest of national defense or 
foreign policy and that are, in fact, 
properly classified under the Executive 
order. 

(2) Internal Personnel Rules and 
Practices: Related solely to the internal 
personnel rules and practices of an 
agency. 

(3) Information Exempt Under Other 
Laws: Specifically exempted from 
disclosure by statute, provided that the 
statute— 

(i) Requires that the matters be 
withheld from the public in such a 
manner as to leave no discretion on the 
issue or 

(ii) Establishes particular criteria for 
withholding or refers to particular types 
of matters to be withheld. 

(4) Confidential Business Information: 
Trade secrets and commercial or 
financial information obtained from a 
person and privileged or confidential. 

(5) Internal Government 
Communications: Interagency or intra¬ 
agency memorandums or letters which 
would not be available by law to a party 
other than an agency in litigation with 
the agency. 

(б) Personal Privacy: Personnel, 
medical, and similar files the disclosure 
of which would constitute a clearly 
unwarranted invasion of personal 
privacy. 

(7) Law Enforcement: Records or 
information compiled for law 
enforcement purposes, but only to the 
extent that the production of such law 
enforcement records or information: 

(i) Could reasonably be expected to 
interfere with enforcement proceedings; 

(ii) Would deprive a person of a right 
to a fair trial or an impartial 
adjudication; 

(iii) Could reasonably be expected to 
constitute an unwarranted invasion of 
personal privacy; 

(iv) Could reasonably be expected to 
disclose the identity of a confidential 


source, including a State, local, or 
foreign agency or authority or any 
private institution which furnished 
information on a confidential basis, and, 
in the case of a record or information 
compiled by a criminal law enforcement 
authority in the course of a criminal 
investigation, or by an agency 
conducting a lawful national security 
intelligence investigation information 
furnished by a confidential source; 

(v) Would disclose techniques and 
procedures for law enforcement 
investigations or prosecutions, or would 
disclose guidelines for law enforcement 
investigations or prosecutions if such 
disclosure could reasonably be expected 
to risk circumvention of the law; or 

(vi) Could reasonably be expected to 
endanger the life or physical safety of 
any individual. 

(8) Financial Institutions: Contained in 
or related to examination, operating, or 
condition reports prepared by, on behalf 
of, or for the use of an agency 
responsible for the regulation or 
supervision of financial institutions. 

(9) Geological Information: Geological 
and geophysical information and data, 
including maps, concerning wells. 

(b) The Section will provide any 
reasonably segregable portion of a 
record to a requester after deletion of 
the portions that are exempt under this 
section. 

(c) The section will invoke no 
exemption under this section if the 
requested records are available to the 
requester under the Privacy Act of 1974 
and its implementing regulations. 

(d) Whenever a request is made which 
involves access to records described in 
paragraph (a)(7)(i) of this section and 

(1) The investigation or proceeding 
involves a possible violation of criminal 
law, and 

(2) There is reason to believe that the 
subject of the investigation or 
proceeding is not aware of its pendency, 
and disclosure of the existence of the 
records could reasonably be expected to 
interfere with enforcement proceedings, 
the agency may, during only such time 
as that circumstance continues, treat the 
records as not subject to the 
requirements of this section. 

§ 1102.9 Annual report to Congress. 

(a) On or before March 1 of each 
calendar year the Commissioner shall 
submit a report covering the preceding 
calendar year to the Speaker of the 
House of Representatives and President 
of the Senate for referral to the 
appropriate committees of the Congress. 
The report shall include: 

(1) The number of determinations 
made by the section not to comply with 









Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35903 


request for records made to the section 
under the Act and this part and the 
reasons for each such determination. 

(2) The number of appeals made by 
persons under the Act and this part, the 
result of such appeals, and the reason 
for the action upon each appeal that 
results in a denial of information. 

(3) The names and titles or positions 
of each person responsible for the denial 
of records requested under the Act. and 
the number of instances of participation 
for each. 

(4) The results of each proceeding 
conducted pursuant to 552(1)[4)(F) of the 
Act including a report of the 
disciplinary action taken against the 
officer or employee who was primarily 
responsible for improperly withholding 
records or an explanation of why 
disciplinary action was not taken. 

(5) A copy of this part. 

(6) A copy of the fee schedule and the 
total amount of fees collected by the 
section for making records available 
under the Act 

(7) Such other information as 
indicates efforts to administer fully Lhe 
Act. 

(b) A copy of each such report to the 
Congress made pursuant to paragraph 
(a) of this section will be made available 
for public inspection and copying in the 
office of the FOIA Officer. United States 
Section. International Boundary and 
Water Commission. 4171 North Mesa. 
Suite 0310, El Paso. TX 79902-1422. 

§ 1102.10 Examination of records. 

When a request to examine records is 
approved by the FOIA Officer, every 
reasonable effort will be made to 
provide facilities for the purpose of such 
examination. “On the spot“ copying will 
be available if the FOIA Officer decides 
there will be no interference with 
ordinary activities or routine business of 
the section. 

Dated: August 22.199a 
Reinaldo Martinez. 

FOIA Officer 

|FR Doc. 90-20642 Filed 6-31-90: &4S ami 
BILLING CODE 70HMM-M 


DEPARTMENT OF TRANSPORTATION 
Federal Highway Administration 
23 CFR Part 140 
(FHWA Docket No. 89-14J 
RIN 2125-AC07 

Payment Procedures: Construction 
Engineering Costs 

agency: Federal Highway 
Administration (FHWA). DOT. 


action: Final rule. 

summary: The FHWA is amending its 
regulation to implement changes 
mandated by section 133 of the Surface 
Transportation and Uniform Relocation 
Assistance Act [STURAA} of 1987 (Pub. 
L 100-17.101 Slat. 132) and to clarify 
the FHWA policy relating to the 
limitation for reimbursement of eligible 
construction engineering (CE) costs 
established in 23 U.S.C. 121(d). Current 
law establishes the limitation at 15 
percent without the prior request to 
obtain specific approval from FHWA. 
EFFECTIVE date: September 4. 1990. 

FOR FURTHER INFORMATION CONTACT: 
Max 1. Inman. Office of Fiscal Services. 
(202) 366-2853. or Michael ]. Laska. 
Office of the Chief Counsel (202) 366- 
1383. Federal Highway Administration. 
400 Seventh Street, SW„ Washington. 
DC 20590. Office hours are from 7:45 
a^n. to 4:15 p.m.. e.t.» Monday through 
Friday, except legal holidays. 
SUPPLEMENTARY INFORMATION: Section 
133 of the STURAA of 1987 revised 23 
U.S.C. 121(d) by eliminating the 10 
percent limitation on CE costs and 
increasing the limitation to 15 percent of 
construction costs without specific 
approval from the FHWA. 

Prior to the revision of 23 U.S.C. 

121(d), reimbursement of CE costs to 
State highway agencies (SHAs) was 
limited by law to 10 percent of 
construction costs or 15 percent if 
approved by FHWA. SHAs desiring the 
higher limitation were required to 
submit a request to FHWA, along with 
adequate justification and supporting 
data, to demonstrate that a percentage 
increase in excess of 10 percent was 
necessary when actual eligible CE costs 
exceeded the limitation. 

Other revisions are also being made 
to clarify current FHWA policy 
regarding CE costs. The specific changes 
for each section of the regulation are as 
follows: 

Section 140.201 Purpose 

This section is amended by removing 
the statement relating to increasing the 
statutory limitation from 10 to 15 
percent. 

Section 140.203 Definitions 

This section is revised by removing 
the definitions and adding a new 
section. Policy. This new section 
includes provisions relating to the 15 
percent limitation and also includes the 
following provisions which have been 
added to clarify existing FHWA policy 
on reimbursement of CE costs: 

(1) The new § 140.203(d) requires that 
estimated CE costs approved at the time 
of project authorization be based on the 


amount of costs the SHA expects to 
incur, not to exceed the 15 percent 
limitation. The 15 percent i* not a 
standard additive rate for project cost 
estimates. 

(2) The new 5 140L203(e) provides 
clarification of FHWA policy for 
determining CE costs when SHAs opt to 
use average rates in lieu of actual costs 
per project in accordance with the 
provisions of 23 U.S.C. 120(h). 

Seel ion 140205 Increase in Per Centum 
of Limitation 

This section is revised to remove the 
procedures for increasing the percentage 
limitation from 10 to 15 percent which 
are no longer applicable. The revision to 
5 140.205 contains provisions relating to 
die application of the limitation. 

Section 140207 Categories of Funds 
Subject to Application of Limitation 

Section 140.207 is removed, but the 
provisions of this section are included ta 
the revised f 140.205, Application of 
Limitation. The current regulation lists 
specific categories of funds subject to 
the limitation. Since most categories of 
funds are subject to the limitation, the 
revised section lists only those 
categories of funds exempt from the 
limitation. 

A notice of proposed rulemaking 
(NPRM) was published m the Federal 
Register of August 25.1989 (54 FR 35354- 
35356). A total of 8 responses were 
received from seven State Highway 
Agencies (SHAs). and one engineering 
consulting firm within the 60 day 
comment period provided in the notice 
of proposed rulemaking. Of the 
comments received, four supported the 
rule change in its entirety. The other 
four comments supported the rule 
change, but with various 
recommendations. 

Discussion of Comments 

1. One comment recommended that 
FHWA limit CE costs to 15 percent of 
the annual cost of the Federal-aid 
Construction Program for each State. 

FHWA cannot accomplish this change 
by regulation due to the current 
language in section 121, of title 23, U.S.C. 
In accordance with 23 U.S.C. 121(a), a 
State is reimbursed for the costs of 
construction incurred by it on a project- 
by-project basis. Reimbursement for CE 
(23 U.S.G. 121(d)) is limited to a 
percentage (15%) of the construction 
costs of a project, excluding from the 
cost of construction the costs of rights- 
of-way, preliminary engineering, and 
construction engineering. 

2. One comment recommended that 
FHWA restrict the statewide aggregate 













33904 Federal Register / Vol. 55. No. 171 / Tuesday. September 4, 1990 / Rules and Regulations 


average to the 15% range, but allow 
individual projects to be approved by 
the FHWA for the CE costs which 
exceed the limitation. 

FHWA cannot include this 
recommendation because of the 
restriction of 23 U.S.C. 121(d) which 
specifically provides that payments for 
construction engineering on any project 
financed with Federal-aid funds is 
limited to 15% of the costs of 
construction. There are no exceptions. 

3. One comment recommended adding 
(1) The installation and operation of 
Field offices and acquisition of 
associated office equipment, (2) the 
conducting of core boring and 
subsurface investigation during 
construction, (3) the performance of 
design and specification changes during 
construction, and (4) the costs 
associated with litigations and related 
legal actions to the new § 140.203(a), 
Policy. To be consistent throughout 23 
CFR 140, we are limiting the 
reimbursement criteria for CE costs to 
those defined in 23 CFR 140.703(b). This 
comment will be considered if the 
definition for CE as defined in 

§ 140.703(b) is revised. 

4. A comment from the engineering 
consulting firm stated that it does not 
quote shop drawing reviews as a part of 
construction engineering services, nor 
does it believe it is current industry 
practice. However, we received a 
comment from an SHA indicating that it 
continues to include shop drawing 
reviews as a part of CE costs. The 
consulting firm raises no objection in the 
event the FHWA continues to include 
shop drawing reviews as a part of CE 
cost because it feels it will still be able 
to be accommodated within the 15% 
limitation. This comment will be 
considered if the definition for CE is 
revised. We have revised the new 

§ 140.203(a) to refer to the reimbursable 
costs for CE described in § 140.703. 

Regulatory Impact 

The FHWA has determined that this 
document does not contain a major rule 
under Executive Order 12291 or a 
significant regulation under the 
regulatory policies and procedures of 
the Department of Transportation. This 
rulemaking action was initiated in order 
to implement a statutory mandate. A 
regulatory evaluation is not required 
because of the ministerial nature of this 
action. However, this revision will 
eliminate the administrative burden 
upon SHAs which was necessary to 
justify an increase in the construction 
engineering limitation from 10 to 15 
percent. 

For this reason, the FHWA hereby 
certifies that this action will not have a 


significant economic impact on a 
substantial number of small entities 
under the criteria of the Regulatory 
Flexibility Act (Pub. L. 95-354). 

This action has been analyzed in 
accordance with the principles and 
criteria contained in Executive Order 
12612, and it has been determined that 
the proposed rulemaking does not have 
sufficient federalism implications to 
warrant the preparation of a Federalism 
Assessment. 

A regulatory information number 
(RIN) is assigned to each regulatory 
action listed in the Unified Agenda of 
Federal Regulations. The Regulatory 
Information Service Center publishes 
the Unified Agenda in April and 
October of each year. The RIN 
contained in the heading of this 
document can be used to cross reference 
this action with the Unified Agenda. 

In consideration of the foregoing, the 
FHWA proposes to amend title 23, Code 
of Federal Regulations, by revising part 
140, subpart B as set forth below. 

(Catalog of Federal Domestic Assistance 
Program Number 20.205, Highway Planning 
and Construction. The regulations 
implementing Executive Order 12372 
regarding intergovernmental consultation on 
Federal programs and activities apply to this 
program.) 

List of Subjects in 23 CFR Part 140 

Accounting, Grant programs— 
transportation, Highways and roads. 

Issued on August 24,1990. 

T.D. Larson, 

Administrator. 

The FHWA proposes to amend 23 
CFR part 140, subpart B as follows: 

PART 140 — REIMBURSEMENT 

1. The authority citation for part 140 is 
revised to read as follows and all other 
authority citations which appear 
throughout part 140 are removed: 

Authority: 23 U.S.C. 101(e), 114(a). 120,121. 
122 and 315; and 49 CFR 1.48(b). 

2. Subpart B of part 140 is revised to 
read ss follows: 

Subpart B—Construction Engineering 
Costs 

Sea 

140.201 Purpose. 

140.203 Policy. 

140.205 Application of limitation. 

Subpart B—Construction Engineering 
Costs 

§ 140.201 Purpose. 

The purpose of this subpart is to 
prescribe policies for claiming 
reimbursement for eligible construction 
engineering (CE) costs. 


§140.203 Policy. 

(a) States may be reimbursed for the 
Federal share of CE costs incurred as 
described in § 140.703 of the CFR. 

(b) Reimbursement of CE costs is 
limited to 15 percent of the costs of 
construction on a project, exclusive of 
the costs of preliminary engineering. CE, 
and rights-of-way. 

(c) The 15 percent limitation applies to 
projects for which a final voucher was 
not approved prior to April 2,1987. 

(d) The estimated CE costs approved 
at the time of project authorization shall 
be based on the amount of costs the 
SHA expects to incur, not to exceed the 
15 percent limitation. 

(e) If the SHA claims CE costs as an 
average percentage of the actual 
construction costs in accordance with 23 
U.S.C. 120 (h), the average rate shall be 
determined based upon reimbursable CE 
costs. If the individual projects used in 
developing the average percentage 
contain CE costs exceeding the 
limitation established in 23 U.S.C. 

121(d), then those excess costs shall not 
be included in determining the average 
percentage. 

§ 140.205 Application of limitation. 

All projects financed with Federal-aid 
highway funds are subject to the 
limitation except for projects funded 
from the following categories: 

(a) Emergency Relief (23 U.S.C. 125), 

(b) Federal Lands Highways (23 U.S.C. 
204), 

(c) Defense Access Roads (23 U.S.C. 

210 ). 

(d) Appalachian Development 
Highways (section 201 of Pub. L. 80-4, 79 
Stat. 5), 

(e) Public Lands Development Roads 
and Trails (23 U.S.C. 214), and 

(f) Other categories determined by 
FHWA to be exempt from the limitation. 
[FR Doc. 90-20655 Filed 8-31-90; 8:45 am) 

BILLING CODE 4910-22-M 


DEPARTMENT OF DEFENSE 

Department of the Army 

32 CFR Part 651 

Environmental Effects of Army 
Actions 

agency: Department of the Army; DOD. 
action: Final rule._ 

summary: This rule amends the list of 
categorical exclusions (CX) in appendix 
A, 32 CFR part 651 (Army Regulation 
200-2). Specifically, the change to CX A- 
14 eliminates a numerical or percentage 
trigger except as prescribed by statute 












Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35905 


in order to focus on the environmental 
impacts of realignments or reductions. 

dates: Effective October 5,1990. 

FOR FURTHER INFORMATION CONTACT: 

Timothy P. Julius, Environmental 
Protection Specialist. Army 
Environmental Office. Headquarters, 
Department of the Army. Washington, 
DC 20310-2600, telephone 202-693-5032. 

SUPPLEMENTARY INFORMATION: The 

Department of Defense is in the process 
of adjusting to a changing political and 
military climate. Part of the adjustment 
process includes proposals to realign 
and reduce current force structure in 
response to strategic and budgetary 
factors. Through recent experience, the 
Army has concluded that categorical 
exclusion A-14 should focus on 
potential environmental consequences 
of proposed realignments or reductions, 
and not on numerical or percentage 
triggers. The proposed rule to amend A- 
14 was published in the Federal Register 
on July 20,1990 (55 FR 29636). No 
comments were received in response to 
the proposal. 

List of Subjects in 32 CFR Part 651 

Environmental protection, 
Environmental impact statements. 
Natural resources, Ecology. 

Adoption of the Amendment 

Accordingly, the Army amends 32 
CFR part 651 as follows: 

1. The authority citation for 32 CFR 
part 651 continues to read as follows: 

Authority: National Environmental Policy 
Act of 1969 (NEPA), 42 U.S.C. 4321 et seq. 
Council on Environmental Quality 
Regulations, 40 CFR parts 1500-1508. 43 FR 
55978-56007, November 29.1978, as amended 
at 51 FR 15625. April 25.1988. and E.0.12114. 

Appendix A [Amended] 

2. Categorical Exclusion A-14 in 
appendix A is revised to read: 
Reductions and realignments of civilian 
or military personnel that: (1) Fall below 
the thresholds for reportable actions as 
prescribed by statute; (2) will not result 
in the abandonment of facilities or 
disruption of environmental, surety (e.g., 
chemical, nuclear, or ammunition 
safeguards), or sanitation services (e.g., 
shutdown of a water treatment plant); 
and (3) will not otherwise require an EA 
or an EIS to implement (e.g., new 
construction to accommodate realigned 
personnel or major demolition 
activities). (REC required.) 


Dated: August 29.1990. 

Lewis D. Walker. 

Deputy Assistant Secretary of the Army 
(Environment, Safety and Occupational 
Health), OASA (l L&E). 

[FR Doc. 96-20739 Filed 8-31-90; 8:45 am) 

BILLING CODE 3710-Oft-M 


FEDERAL COMMUNICATIONS 
COMMISSION 

47 CFR Part 73 

[Docket No. 88-582; RM-6443, RM-6686, 
RM-6887, RM-6688] 

Radio Broadcasting Services; 
Morehead, Russell, and Westwood, KY 

agency: Federal Communications 

Commission. 

action: Final rule. 

summary: This document allots Channel 
242A to Morehead, Kentucky, at the 
request of Brad-Lee-Todd Corporation, 
and Channel 2594 to Westwood, 
Kentucky, in response to a petition filed 
by James C. Sliger, which was treated as 
a counterproposal in this proceeding. 

See 54 FR 01196, January 12,1989. 
Channel 242A can be allotted to 
Morehead, Kentucky, in compliance 
with the Commission’s minimum 
distance separation requirements. The 
coordinates for Channel 242A at 
Morehead are North Latitude 38-11-37 
and West Longitude 83-24-16. Channel 
259A can be alloted to Westwood, 
Kentucky, in compliance with the 
Commission’s minimum distance 
separation requirements with a site 
restriction 12.2 kilometers (7.6 miles) 
southwest. The coordinates for Channel 
259A at Westwood are North Latitude 
38-26-20 and West Longitude 82-47-52. 
With this action, this proceeding is 
terminated. 

dates: Effective October 15,1990; The 
window period for filing applications 
will open on October 16,1990, and close 
on November 15,1990. 

FOR FURTHER INFORMATION CONTACr. 

Nancy J. Walls, Mass Media (202) 634- 
6530. 

SUPPLEMENTARY INFORMATION: This i8 8 
synopsis of the Commission’s Report 
and Order, MM Docket No. 88-582, 
adopted August 15,1990, and released 
August 29,1990. The full text of this 
Commission decision is available for 
inspection and copying during normal 
business hours in the FCC Dockets 
Branch (Room 230), 1919 M Street, NW., 
Washington. DC. The complete text of 
this decision may also be purchased 
from the Commission’s copy contractors, 
International Transcription Service, 


(202) 857-3800, 2100 M Street. NW.. Suite 
140, Washington, DC 20037. 

List of Subjects in 47 CFR Part 73 

Radio broadcasting. 

1. The authority citation for part 73 
continues to read as follows: 

Authority: 47 U.S.C. 154, 303. 

§73.202 [ Amended 1 

2. Section 73.202(b), the Table of FM 
Allotments is amended under Kentucky 
by adding Channel 242A at Morehead, 
and by adding Westwood. Channel 
259A. 

Kathleen B. Levitz, 

Deputy Chief, Policy and Rules Division, 

Mass Media Bureau. 

[FR Doc. 90-20746 Filed 8-31-90; 8:45 am) 

BILUNG CODE 6712-01-11 


47 CFR Part 73 

[MM Docket No. 89-400; RM-6808] 

Radio Broadcasting Services; 
Georgetown, TX 

AGENCY: Federal Communications 

Commission. 

action: Final rule. 

summary: This document substitutes 
Channel 299C3 for channel 299A at 
Georgetown, Texas, and modifies the 
permit of Station KJWL to specify 
operation on the higher class co¬ 
channel, at the request of Williamson 
County Communications. See 54 FR 
39211 September 25,1989. Channel 
299C3 can be allotted to Georgetown in 
compliance with the Commission's 
minimum distance separation 
requirements with a site restriction of 
18.9 kilometers (11.7 miles) northeast to 
accommodate petitioner’s desired 
transmitter site. The coordinates for 
Channel 299C3 at Georgetown are 30- 
43-08 and 97-30-24. With this action, 
this proceeding is terminated. 

EFFECTIVE DATE: October 15.1990. 

FOR FURTHER INFORMATION CONTACT: 
Andrew J. Rhodes, (202) 634-6530. 
SUPPLEMENTARY INFORMATION: This is a 
synopsis of the Commission’s Report 
and Order, MM Docket No. 89-400, 
adopted August 17,1990. and released 
August 29,1990. The full text of this 
Commission decision is available for 
inspection and copying during normal 
business hours in the FCC Dockets 
Branch (Room 230), 1919 M Street, NW., 
Washington, DC. The complete text of 
this decision may also be purchased 
from the Commission’s copy contractors. 
International Transcriptional Service, 














35906 Federal Resistor / Vol. 55* No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


(202) 357-3300, 2100 M Street, NW n Suite 
140. Washington, DC 20037. 

List of Subjects in 47 CFR Part 73 

Radio broadcasting. 

PART 73—(AMENDED) 

1. The authority citation for part 73 
continues to read as follows: 

Authority: 47 U.S.C. 154, 303. 

§73.202 (Amended 1 

2. Section 73^Q2(b), the Table of FM 
Allotments is amended under Texas by 
removing Channel 299A and adding 
Channel 299C3 at Georgetown. 

Federal Communications Commission. 

Kathleen B. Levttz. 

Deputy Chief. Policy and Rubs Division, 

Mass Media Bureau. 

|FR Doc. 90-20744 Filed 8-31-90; 345 am( 
BILLING CODE 6712-Of-M 


DEPARTMENT OF THE INTERIOR 
Fish and Wildlife Service 

50 CFR Part 32 
RiN 1018 AA71 

Refuge-Specific Hunting Regulations 

AGENCY: Fish and Wildlife Service, 
Interior. 

action: Final rule; correction. 

summary: The Fish and Wildlife Service 
here corrects four errors relating to a 
final rule on refuge-specific hunting 
regulations that appeared in the Federal 
Register on November 7,1939 (54 FR 
46730). The errors were procedural or 
typographical in nature and are 
discussed briefly below. 

FOR FURTHER INFORMATtON CONTACT! 
Larry LaRochelle, U.S. Fish and Wildlife 
Service, Division of Refuges, MS 670- 
ARLSQ, 1849 C Street NW., Washington, 
DC 20240; Telephone: 703/358-2043. 
SUPPLEMENTARY INFORMATION: 

§32.12 lAmended] 

1. On page 46731, third column, 
amendatory action 2, lines 9 through 12, 
remove the words "removing paragraphs 
(H)(2); and redesignating paragraphs 


(11) (3) and (4) as paragraphs (11) (2) 
and (3) respectively” This amendment 
was accomplished in a previous 
rulemaking on October 31,1983 (53 FR 
43891). 

§32.22 (Amended] 

2. On page 46732, first column, 
amendatory action 3, line 3, change 
"(q){3)(ir to "(q)(4](in line 5, change 
••((T)(10)(HT to *'(ff)(8)(ii} M ; second 
column, change "(3) D*Arbonne National 
Wildlife Refuge” to “(4) D’Arbonne 
National Wildlife Refuge”; third column, 
change "(10) Umatilla National Wildlife 
Refuge’’ to ‘‘(81 Umatilla National 
Wildlife Refuge”. 

§ 32.32 (Amended) 

3. On page 46732, third column, 
amendatory action 4, second line change 
"paragraphs (d)(5)” to "paragraphs 
(d)(0)”: in the second and third lines of 
narrative under § 32.32 refuge-specific 
regulations; big game, change "(5) White 
River National Wildlife Refuge” to ”(6) 
White River National Wildlife Refuge”. 

Dated: August 10,1990 

Dick Smith. 

Acting Director. Fish and Wildlife Service. 

(FR Doc. 90-20724 Filed 8-31-90; 8:45 anal 

BILLING CODE 43tO>S5-M 










35907 


Proposed Rules 


Federal Register 

Vol. 55, No. 171 
Tuesday. September 4. 1990 


This section of the FEDERAL REGISTER 
contains notices to the public of the 
proposed issuance of rules and 
regulations. The purpose of these notices 
is to give interested persons an 
opportunity to participate in the rule 
making prior to the adoption of the final 
rules. 


DEPARTMENT OF AGRICULTURE 
Farmers Home Administration 
7 CFR Part 1965 

Security Servicing for Multiple Family 
Housing Loans 

agency: Farmers Home Administration. 

usOa. 

action: Proposed rule. 

summary: The Farmers Home 
Administration (FmHA) proposes to 
amend its Multiple Family Housing 
Security Servicing regulations. This 
action is being taken to incorporate 
flexibility in servicing delinquent 
multiple housing accounts based on 
annual servicing needs and goals 
established by the National Office. This 
amendment will delete the necessity for 
classifying delinquent multiple housing 
accounts which will eliminate 
duplication of work. The reason for the 
delinquency and plans for resolving the 
delinquency are include in the serving 
plan required by the regulation. 

DATES: Comments must be received on 
or before November 3.1990. 
addresses: Submit written comments 
in duplicate to be Office of the Chief. 
Directives and Forms Management 
Branch. FmHA, room 6348, South 
Agriculture Buildings. Washington, DC 
20250. All written comments made 
pursuant to this notice will be available 
for public inspection during regular 
work hours at the above address. 

FOR FURTHER INFORMATION CONTACT: 
Wanda L. Triplet, Loan Specialist, 
Multiple Family Housing Servicing and 
Property Management Division. Farmers 
Home Administration (FmHA). USD A. 
room 5333, South Agriculture Building. 
14th and Independence. SW.. DC 20250. 
telephone (202) 382-1612. 
SUPPLEMENTARY INFORMATION: 
Classification 

This action has reviewed under USDA 
procedures established in Departmental 
Regulation 1512-1, which implements 


Executive Order 12291, and has been 
determined to be nonmajor because 
there will not be an annual effect on the 
economy of $100 million or more; a 
major increase in cost or prices for 
consumers, individual industries. 
Federal, State, or local government 
agencies or geographic regions; or 
significant adverse effects on 
competition, employment, investment, 
productivity, innovation, or on the 
ability of the United States-based 
enterprises to compete with foreign- 
based enterprises in domestic or export 
market^. 

Environmental Impact Statement 

This document has been reviewed in 
accordance with 7 CFR part 1940, 
Subpart G. “Environmental Programs.” 

It is the determination of FmFA that this 
action does not constitute a major 
Federal action significantly affecting the 
quality of the human environmental, 
and, in accordance with the National 
Environmental Policy Act of 1969, Public 
L 91-190, an Environmental Impact 
Statement is not required. 

Regulatory Flexibility Act 

This proposed rule has been reviewed 
with regard to the requirements of the 
Regulatory Flexibility Act (5 U.S.C. 601- 
612). The undersigned has determined 
and certified by signature of this 
document that this rule will not have 
significant economic impact on a 
substantial number of small entities, 
since this rulemaking action does not 
involve a new or expanded program. 

Intergovernmental Consultation 

For the reasons set forth in the final 
Rule related Notice(s) to 7 CFR part 
3015, subpart V, 48 FR 29112, June 24, 
1983, programs 10.415 Rural Rental 
Housing Loans and 10.427, Rural Rental 
Assistance Payments (Rental 
Assistance) are subject to Executive 
Order 12372, which requires 
intergovernmental consultation with 
State and local officials. 

Programs Affected: 

These changes affect the following 
FmHa program/activites as listed in the 
Catalog of Federal Domestic Assistance: 
10.405— Farm Labor Housing Loans and 
Grants; 10.415 —Rural Rental Housing 
Loans. 


List of subjects in 7 CFR Part 1965 

Administrative practice and 
procedure, Low and moderate income 
housing-Rental, Mortgages. 

Therefore, as proposed, chapter XVIII, 
title. 7, Code of Federal Regulations is 
amended as follows: 

PART 1965 —REAL PROPERTY 

1. The authority citation for part 1965 
continues to read as follows: 

Authority: 7 U.S.C. 1989; 41 U.S.C. 1480; 

5 U.S.C. 301; 7 CFR 2.33; 7 CFR 2.70. 

Subpart B—Security for Multiple 
Housing Loans 

2. Section 1965.85 is amended by 
revising paragraph (b) and (e) to read as 
follows: 

§ 1965.85 Default and liquidation. 

• * • • * 

(b) Servicing delinquent accounts. 

(1) The District Director will service 
delinqent accounts with guidance and 
assistance as necessary from the State 
Director. Every delinquent borrower will 
be serviced according to a routine 
established for the particular loan type 
by the State Director. 

(1) [Reserved) 

(ii) [Reseved] 

(iii) [Reserved] 

(iv) [Reserved] 

(2) [Reserved] 

(3) [Reserved] 

(4) [Reserved] 

» • • • • 

(e) Liquidation. Liquidation of all 
mutiple-family type loans will be 
handled according to the applicable 
portions of subpart A of part 1955 of this 
chapter. Suspension, cancellation, 
transfer, and reinstatement of interest 
credits and rental assistance during the 
liquidation process will be serviced in 
accordance with subpart A of part 1955 
and subpart C of part 1930 of this 
chapter. 

Dated: July 25,1990. 

La Verne Ausman, 

Administrator, Farmers Home 
Administration. 

|FR Doc. 90-20722 Filed 8-31-90; 8:45 am| 

BILLING COOE 3410-07-*! 















35908 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Proposed Rules 


SMALL BUSINESS ADMINISTRATION 
13 CFR Part 121 

Small Business Size Standards; Waiver 
of the Nonmanufacturer Rule 

agency: Small Business Administration. 
action: Notice of intent to waive the 
nonmanufacturer rule for nine classes of 
petroleum products, except for seven 
geographical areas of the United States. 

summary: The Small Business 
Administration (SBA) is considering a 
waiver to its "nonmanufacturer rule" for 
nine petroleum products, except within 
seven geographical areas. This partial 
waiver is being considered because it 
appears that small refiners provide 
petroleum products to the Federal 
government in only seven geographic 
market areas. The effect of a waiver 
would be to allow an otherwise 
qualified regular dealer to supply the 
product of any domestic refiner on a 
Federal contract set aside exclusively 
for small business or awarded through 
the 8(a) program. The products under 
consideration include: heating oils, 
kerosine, automotive gasoline, and 
diesel fuels, as well as certain other 
specialty petroleum products. The 
purpose of this notice is to solicit 
comments and additional information 
from interested parties. 

DATES: Comments must be submitted on 
or before October 4,1990. 

ADDRESS COMMENTS TO: Robert J. 
Moffitt, Chairperson, Size Policy Board. 
U.S. Small Business Administration. 

1441 L Street, NW., Room 000. 
Washington, DC 20416. 

FOR FURTHER INFORMATION CONTACT: 
Gary M. Jackson. Director, Size 
Standards Staff, (202) 653-6373. 
SUPPLEMENTARY INFORMATION: Public 
Law 100*856, enacted on November 15, 
1988, incorporated into the Small 
Business Act the previously existing 
regulation that recipients of Federal 
contracts set aside for small business or 
8(a) contracts must provide the product 
of small business manufacturer or 
processor, if the recipient is ocher than 
the actual manufacturer or processor. 
This requirement is commonly referred 
to as the "nonmanufacturer rule." The 
SBA regulations imposing this 
requirement are found at 13 CFR 
121.906(b) and 121.1106(b). Section 
303(b) of the law provided for waiver of 
this requirement by SBA for any “class 
of products" for which there are no 
small business manufacturers or 
processors in the Federal markeL This 
notice proposes to waive the 
nonmanufacturer rule for fuel oils plus 


automotive gasoline for those 
geographical areas in which there have 
been no small refiner in the Federal 
market. 

A class of products is considered to 
be a particular Product and Service 
Code (PSC) under the Federal 
Procurement Data System or an SBA 
recognized product line within a PSC 

To be considered in the Federal 
market a small manufacturer must have 
been awarded a contract by ihe Federal 
government within the last three years. 
The definition of the Federal market for 
a class of products assumes that 
products are supplied on a national 
basis. However, a more narrowly 
defined geographic market area may be 
considered when evaluating a waiver of 
a class of products if it is demonstrated 
that the products are not supplied on a 
nationwide basis. SBA will consider 
such factors as perishability of the 
product transportation costs relative to 
the value of the good, stability of a 
market area over time, and potential 
entry into a market area by small 
business before defining a market area 
on less than a national basis. 

The definition of these terms is 
consistent with previous waiver notices 
concerning construction equipment (54 
FR 53317) and mainframe computers (55 
FR 22799] and with a proposed rule 
concerning agency procedures on 
nonmanufacturer waivers (55 FR 20467). 

The classes of products intended for 
waiver, except within seven geographic 
locations, are all of the classes of 
products within PSC-9140, Fuel Oils, 
and one class of products (automotive 
gasoline) within PSC-9130, Liquid 
Propellants and Fuels, Petroleum Base, 
as specifically identified in the following 


table: 


PSC 

Class 0 * psoJuel 

9130 (Part) «... 

Automotive Gasofcr»e. 

9140_ 

All Classes of Products: 

Light and Heavy Burner Fuels. 

Diesel Fuels 

Kerosme. 

Military Specification Type Residuals. 
Special and Heavy Grade Turbine 
Vessel Propulsion Fuels. 

Heavy Fue* and Other Bfacfc (BoHer 
Type) FueiSL 

Bunker "C” Comcn&aN Grade 
Fuels. 

Illuminating Oils. 


1 Only one class ot products wrthsr. PSC-9130 «s 
being considered for waiver. 


SBA is considering a waiver of Ihe 
above classes of products, with the 
exception that the nonmanufacturer rule 
continues to remain in effect for all 
petroleum set-aside of 8(a) contracts in 
seven geographical areas. SBA proposes 
to draw a geographic distinction with 


respect to the waiver based on 
information which demonstrates that, 
while small refiners are in the Federal 
market, they appear to sell their 
products to the Federal government 
within limited distances from their 
refineries. Another class of products 
within PSC-9130, aviation gasoline, 
which includes JP-4. was examined by 
SBA. Based upon our preliminary 
findings, SBA is not presently 
considering a waiver for this class of 
products, as discussed later in this 
notice. 

Over the past several years, SBA has 
received complaints from small 
petroleum dealers regarding the effect of 
the nonmanufacturer rule on small 
business set-asides and 8(3) contracts 
due to the limited availability of 
products from small refiners. An 
analysis of the petroleum industry was 
conducted to determine if a waiver of 
the nonmanufacturer rule should be 
granted. Contract award data were 
obtained from the Federal Procurement 
Data Center and the Defense Fuel 
Supply Center for this analysis. 

SBA has found seven small refiners of 
the designated classes of petroleum 
products in the Federal market in fiscal 
years 1987-1989. Consequently, a waiver 
for these classes of products cannot be 
granted on a national basis. However, a 
more narrow geographical definition of 
the Federal market of small refiners may 
support a waiver for most geographical 
areas in the country. 

Through its review. SBA has found 
that small refiners supplying petroleum 
products to the Federal government may 
be capable of delivering their products 
only to locations within a limited 
geographic market area. Small refiners 
may limit delivery within a geographical 
market area, other than the entire 
United States, due to the high cost of 
shipping to the ultimate user relative to 
the price of the product. There is a 
narrow market price for these products 
and, in competition, a few cents 
additional price due to the costs of 
trucking petroleum over long distance 
(e.g., 100 to 200 airmiles) would cause a 
bid to be uncompetitive. Deliveries of 
these products to the ultimate consumer 
are almost always made by short 
distance trucking. 

SBA reviewed contract data to 
determine if small refiners displayed a 
pattern of delivery on Federal contracts 
for petroleum products within a limited 
geographic area. Distances from die 
refinery and delivery point on Federal 
contracts awarded to six of the seven 
small refiners were available from the 
Defense Fuel Supply Center. These 




















35S09 


Federal Register / VoL 55, No. 171 / Tuesday, September 4, 1990 / Proposed Rules 


awards show nineteen deliveries on 
seven contracts. 

Small refiners delivered petroleum 
products on Federal contracts an 
average distance of 65 miles from their 
refineries. The maximum delivery 
distance by most of the small refiners 
greatly exceeded the average mileage. 
Two small refiners delivered products 
as far as 200 miles and another refiner 
delivered its products a maximum 
distance of 135 miles. 

Because of the limited number of 
contracts to small refiners, SBA believes 
the most supportable definition of a 
Federal market may be demonstrated by 
the maximum distance a small refiner 
has delivered fuel oil to the Federal 
government Accordingly, the maximum 
distance a small refiner has delivered on 
a Federal contract shall determine its 
market area. For administrative 
convenience. SBA will round-up the 
maximum distance to the nearest 50- 
mile increment so as to limit the number 
of potential mileage designations. 

The geographical areas excluded from 
the proposed waiver are: 

(a) Within 100 sirmilea of Chaster. Virginia 
jb) Within 50 aitmiles of Albany. New York 

(c) Within 200 airmites of Vicksburg. 

Mississippi 

(d) Within 200 airmiles of Cheyenne, 

Wyoming 

(e) Within 100 atrmiles of Wood Cross, Utah 

(f) Within 150 airmiles of Tonopah. Nevada 

(g) Wilbin 50 alrmiles of Fairbanks. Alaska 

Airmile distance is to be measured in 
standard miles (5.260 feet) from any 
point from the city or town limits in the 
above seven designated areas. Airmile 
distance may be computed from a 
standard road map or atlas. 

For these above geographical areas, 
the nonmanufacturer rule would remain 
in effect A small regular dealer must 
supply the product of 8 small refiner to 
be eligible for award of a contract set 
aside for small business or through the 
8(a) program. For all other area in the 
United States, a small regular dealer 
would be able to supply the product of 
any domestic refiner on small business 
set-aside or 8(a) contracts if a waiver is 
granted for the nine classes of petroleum 
products discussed in this notice. 

The class of products of aviation 
gasoline, which includes JP—4, (one rJas 3 
of products within PSC-9130) has also 
been examined. SBA has made a 
preliminary determination that for this 
class of products small refiners are in 
the Federal maiket and that a national 
market exists because the product is 
frequently shipped by pipeline many 
hundreds of miles directly to the Federal 
user. The Federal government owns 
many pipelines to aviation installations 
for the shipment of aviation gasoline. 


Thus a waiver for aviation gasoline is 
not contemplated, however, SBA is 
seeking public comments on the 
question of a waiver for this class of 
products. 

The public is invited to comment or 
supply information to SBA on the 
proposed waiver of the 
nonmanufacturer rule for the nine 
classes of petroleum products specified. 
Comments regarding SBA'a designation 
of the geographic market areas for 
which a waiver is not being considered 
are encouraged. 

Susan S. Engeleiter, 

Administrator, US . Small Business 
Administration. 

(FR Doc. 90-20711 Filed 8-31-90; 8.45 am) 
Billing code 802&-cmui 


FEDERAL COMMUNICATIONS 
COMMISSION 

47 CFR Part 1 

(Gen. Dkt. 90.264; DA 90-11281 
Administrative Practice and Procedure 

agency: Federal Communications 
Commission. 

action: Proposed rule; extension of 
time. 

summary: The Commission proposed 
revised rules (55 FR 28063. Juty 9,1990} 
to expedite its comparative hearing 
process for new applicants in order to 
speed service to the public. A request to 
extend the comment date came in from 
the Federal Communications Bar 
Association. 

dates: Comments are due on or before 
September 14,1990, and Reply 
Comments are due on or before October 
15,199*3. 

addresses: Federal Communications 
Commission, 1919 M Street NVV., 
Washington, DC 20554. 

FOR FURTHER INFORMATION CONTACT: 

Martin Blumenthal, (202) 254-6530. 

SUPPLEMENTARY INFORMATION: 

Order 

In the Matter Proposals to Reform the 
Commission’s Comparative Hearing 
Process to Expedite the Resolution of 
Cases 

Adopted: August 23,1990. 

Released: August 24,1990. 

By the General Counsel 

1. The Federal Communications Bar 
Association (FCBA) requests an 
extension of 30 days within which to file 
comments in this proceeding. The FCBA 
states that “it will be difficult, if not 
impossible” for it to develop the 
consensus of its membership necessary 


to prepare its comments by the current 
August 27,1990 deadline for filing 
comments in this proceeding. 

2. In establishing the comment dales 
in this proceeding, the Commission 
noted that “|extensions of these time 
periods are not contemplated.” 

However, that admonition must be 
balanced against the expected value of 
the FCBA’s comments and the 
organization’s need to develop a 
consensus of its membership. In these 
circumstances, we believe that the 
public interest will be served by an 
extension of the comment period until 
September 14,1990. 

3. Accordingly, it is ordered\ That, 
pursuant to authority delegated in 
section 0.251 of the Commission's rides, 
47 CFR 0.251, the “Motion for Extension 
of Time” filed by the Federal 
Communications Bar Association is 
grunted, to the extent indicated above. 

4. It is further ordered, that the time 
for filing Comments in this proceeding is 
extended until September 14,1990. 

Reply Comments will be due by October 
15.1990. 

List of Subjects in 47 CFR Part 1 

Administrative practice and 
procedure. 

Federal Communications Commission. 
Sheldon M Guttciann, 

Associate General Counsel. 

(FR Doc. 90-20519 Filed *-32-40; 8:45 am) 

BILL-KG CCOC 


47 CFR Part 73 

(MM Docket No. 90-3*7, RM-7282) 

Radio Broadcasting Services; Rainelle, 
WV 

agency: Federal Communications 
Commission. 

action: Proposed rule. 

summary: This document requests 
comments on a petition by R-B 
Company. Inc., licensee of Station 
WRRL-FM, Rainelle, West Virginia, 
proposing the substitution of Channel 
237A for Channel 244A at Rainelle, and 
modification of its license to specify 
operation on Channel 237A. Petitioner 
seeks to substitute Class A channels in 
order to increase Station WRRL-FM** 
power to 6 kilowatts. Channel 237A can 
be allotted to Rainelle. West Virginia, in 
compliance with the Commission’s 
minimum distance separation 
requirements ai WRRL-FM’s current 
transmitter site. The coordinates are 37- 
57-28 and 80^5-45. 















3 i910 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Proposed Rules 


dates: Comments must be filed on or 
before October 22,1990, and reply 
comments on or before November 6, 
1990. 

addresses: Federal Communications 
Commission. Washington, DC 20554. In 
addition to filing comments with the 
FCC, interested parties should serve the 
petitioner, or its counsel or consultant, 
as follows: David M. Hunsaker, 

Putbrese, Hunsaker & Ruddy. 6800 
Fleetwood Road, Suite 100, P.O. Box 539, 
McLean, Virginia 22101. 

FOR FURTHER INFORMATION CONTACT: 

Andrew J. Rhodes, Mass Media Bureau. 
(202) 634-6530. 

SUPPLEMENTARY INFORMATION: This is a 
synopsis of the Commission’s Notice of 
Proposed Rule Making, MM Docket No. 
90-387, adopted August 14,1990, and 
released August 29,1990. The full text of 
this Commission decision is available 
for inspection and copying during 
normal business hours in the FCC 
Dockets Branch (Room 230), 1919 M 
Street NW., Washington, DC. The 
complete text of this decision may also 
be purchased from the Commission’s 
copy contractors. International 
Transcription Service. (202) 857-3800. 
2100 M Street NW., Suite 140, 
Washington, DC 20037. 

Provisions of the Regulatory 
Flexibility Act of 1980 do not apply to 
this proceeding. 

Members of the public should note 
that from the time a Notice of Proposed 
Rule Making is issued until the matter is 
no longer subject to Commission 
consideration or court review, all ex 
parte contacts are prohibited in 
Commission proceedings, such as this 
one, which involve channel allotments. 
See 47 CFR 1.1204(b) for rules governing 
permissible ex parte contacts. 


For information regarding proper Tiling 
procedures for comments, see 47 CFR 
1.415 and 1.420. 

List of Subjects in 47 CFR Part 73 

Radio broadcasting. 

Federal Communications Commission. 
Kathleen B. Levitz, 

Deputy Chief. Policy and Rules Division. 

Mass Media Bureau. 

|FR Doc. 90-20745 Filed 8-31-90: 8:45 am] 
BILLING CODE 6712-01-M 


47 CFR Part 73 

[MM Docket No. 90-393, RM-7213] 

Radio Broadcasting Services; 
Tomahawk, Wl 

agency: Federal Communications 

Commission. 

action: Proposed rule. 

summary: This document requests 
comments on a proposal filed by 
Gregory A. Albert and Margaruite S. 
Albert, d/b/a Albert Broadcasting, 
requesting the substitution of Channel 
223C3 for Channel 224A at Tomahawk, 
Wisconsin, and modification of the 
license for Station WJJQ-FM to specify 
the higher class channel. Canadian 
concurrence will be requested at 
coordinates 45-29-27 and 89-43-33. 
dates: Comments must be filed on or 
before October 22,1990, and reply 
comments on or before November 6, 
1990. 

addresses: Federal Communications 
Commission, Washington, DC 20554. In 
addition to filing comments with the 
FCC, interested parties should serve the 
petitioner, or its counsel or consultant, 
as follows: Richard R. Zaragoza, John J. 
McVeigh, Fisher, Wayland, Cooper and 


Leader, 1255 Twenty-third Street NW.. 
Suite 800, Washington, DC 20037-1125. 
FOR FURTHER INFORMATION CONTACT: 
Kathleen Scheuerle, Mass Media 
Bureau, (202) 634-6530. 

SUPPLEMENTARY INFORMATION: This is a 
synopsis of the Commission’s Notice of 
Proposed Rule Making. MM Docket No. 
90-393, adopted August 17.1990, and 
released August 29.1990. The full text of 
this Commission decision is available 
for inspection and copying during 
normal business hours in the FCC 
Dockets Branch (Room 230), 1919 M 
Street NW., Washington, DC. The 
complete text of this decision may also 
be purchased from the Commission’s 
copy contractors, International 
Transcription Service, (202) 857-3800, 
2100 M Street NW., Suite 140, 
Washington, DC 20037. 

Provisions of the Regulatory 
Flexibility Act of 1980 do not apply to 
this proceeding. 

Members of the public should note 
that from the time a Notice of Proposed 
Rule Making is issued until the matter is 
no longer subject to Commission 
consideration or court review, all ex 
parte contacts are prohibited in 
Commission proceedings, such as this 
one, which involve channel allotments. 
See 47 CFR Section 1.1204(b) for rules 
governing permissible ex parte contacts. 
For information regarding proper filing 
procedures for comments, see 47 CFR 
1.415 and 1.420. 

List of Subjects in 47 CFR Part 73 

Radio broadcasting. 

Federal Communications Commission 
Kathleen B. Levitz, 

Deputy Chief Policy and Rules Division, 

Mass Media Bureau. 

[FR Doc. 90-20747 Filed 8-31-90: 8:45 am| 

BILLING CODE 6712-01-M 










Notices 


Fedora l Register 

Vol. 55. No. 171 

Tuesday, September 4. 1900 


35911 


This section of the FEDERAL REGISTER 
contains documents othe# than luies or 
proposed rules that are applicable to the 
public. Notices of hearings and 
investigations, committee meetings, agency 
decisions and rulings, delegations of 
authority, filing of petitions and 
applications and agency statements of 
organization and functions are examples 
of documents appearing in this section. 


DEPARTMENT OF AGRICULTURE 

Grant to Save the Children Foundation 

agency: Office of Internationa) 
Cooperation and Development (OICD), 
Agriculture. 

action: Notice of intent. 

ACTIVITY: OICD intends to award a 
Grant to Save the Children Foundation 
(SCF) to provide partial funding support 
for reproduction/distribution of the 
publication, "Planning for 
Agroforestry.**. 

authority: Section 1458 of the National 
Agricultural Research. Extension and 
Teaching Policy Act of 1977, as amended 
(7 U.S.C. 3291). and the Food Security 
Act of 1985 [pub. L 99-198). 

OICD anticipates the availability of 
funds in fiscal year 1990 (FY1990) for 
partial funding support to SCF to 
reproduce m Spanish and distribute the 
publication, 'Tlarrning for Agroforestry.** 
The publication is an easy-to-use 
handbook for development workers 
interested in exploring agroforestry 
projects with their local communities, 
with special emphasis m community 
organization and promotional aspects. 

To date, the book has only existed in 
English. Given the limited amount of 
literature published in Spanish 
addressing these specific themes, 
"Planning for Agroforestry** will serve 
as a valuable resource to the Latin 
America region. 

Based on the above, this is not a 
formal request for application. An 
estimated $5,310 will be available in 
FY1990 as partial project support. 

Information on proposed Grant #59- 
319R-0-005 may be obtained from: 
USDA/OIDC/Management Services 
Branch, Washington, DC 29250-4300. 
Dated: August 27.1990. 

Nancy ]. Croft, 

Contracting Officer. 

[FR Doc. 90-20726 Filed 8 - 31 - 90 ; 8:45 a 
BILLING CODE 3410-OP-II 


Grant To Save the Children Foundation 

agency: Office of International 
Cooperation and Development (OICD), 
Agriculture. 

action: Notice of intent. 

activity: OICD intends to award a 
grant to Save the Children Foundation 
(SCF) to provide partial funding support 
for several national workshops in 
several countries to analyze the role of 
women in natural resource management 
and conservation. 

authority: Section 1458 of the National 
Agricultural Research, Extension and 
Teaching Policy Act of 1977, as amended 
(7 U.S.C. 3291), and the Food Security 
Act of 1985 (Pub. L. 99-198). 

OICD anticipates the availability of 
funds in fiscal year 1990 (FY1990) for 
partial funding support to SCF to hold 
several national level workshops to 
analyze the role of women in natural 
resource management and conservation. 
The goal is to enhance the participation 
of women In natural resource 
management and conserva lion programs 
in El Salvador through the sharing of 
actual experiences and the analysis of 
the role of women by field level 
extension staff in NGO and government 
programs. 

Based on the above, this is not a 
forma) request for application. An 
estimated $4,720 will be available in FY 
1990 as partial project support. 

Information on proposed Grant #59- 
319R-0-006 may be obtained from: 
USDA/OICD/Management Services 
Branch. Washington, DC 20250-4300. 
Dated; August 27.199a 
Nancy J. Croft, 

Contracting Officer. 

(FR Doc. 90-20727 Fled 8-31-90; 8:45amf 

BILUNG CODE 341C-DP-U 


Grant to Tuskegee University 

action: Office of International 
Cooperation and Development (OICD), 
Agriculture. 

action: Notice of intent. 

activity: OICD intends to award a 
Grant to Tuskegee University to provide 
partial funding support for an 
"Internationa] Conference on Sweet 
Potato Technology for the 21st Century." 
authority: Section 1458 of the National 
Agricultural Research, Extension and 


Teaching Policy Act of 1977, as amended 
(7 U.S.C. 3291), and the Food Security 
Act of 1985 (Pub. L. 99-198). 

Of CD anticipates the availability of 
funds in fiscal year 199Q (FY1990) to 
provide partial funding support to 
Tuskegee Lhiiversify fora conference to 
be held in fune 1991 on 9weef potato 
technology. The conference objective in 
to bring together experts and interested 
parties from around the world to 
envision and explore new methods and 
technologies for sweet potato breeding, 
production, processing, storage, 
marketing and utilization as a food, feed 
and fuel source. 

Based on the above, this is not a 
formal request for application. An 
estimated $5,000 will be available in 
FYl990as partial project support. 

Information on proposed Grant #59- 
319R-0-004 may be obtained from: 
USDA/OICD/Management Services 

Branch. Washington. DC 20250-4300. 

Dated: August 27,1990. 

Nancy J. Croft. 

Contracting Officer. 

[FR Doc. 90-20725 Fifed 8-31-90; 8:45 amf 

BILLING CODE 3410- OP-M 


Federal Grain Inspection Service 

Designation Renewal of the Mid-Iowa 
(IA) Agency, the State of Oregon (OR), 
and the Southern Illinois (IL) Agency 

agency: Federal Grain Inspection 
Service (Service). USD A. 
action: Notice. 

summary: This notice announces the 
designation renewal of Mid-Iowa Grain 
Inspection, Inc. (Mid-Iowa), the Oregon 
Department of Agriculture (Oregon), and 
Southern Illinois Grain Inspection 
Service, Inc. (Southern Illinois) as 
official agencies responsible for 
providing official services under the U.S. 
Crain Standards Act, as amended (Act). 
effective DATE: October 1,1999. 
addresses: James R. Conrad, Chief, 
Review Branch, Compliance Division, 
FGIS, USDA, room 1647 South Building, 
P.O. Box 96454. Washington, DC 20090- 
6454. 

FOR FURTHER INFORMATION CONTACTt 

James R. Conrad, telephone 202-447- 
8525. 

supplementary information: This 

action has been reviewed and 




















S5912 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


determined not to be a rule or regulation 
as defined in Executive Order 12291 and 
Departmental Regulation 1512-1; 
therefore, the Executive Order and 
Departmental Regulation do not apply to 
this action. 

The Service announced that Mid- 
Iowa's. Oregon’s, and Southern Illinois’ 
designations terminate on September 30. 
1990, and requested applications for 
official agency designation to provide 
official services within specified 
geographic areas in the April 2,1990. 
Federal Register (55 FR 12241). 
Applications were to be postmarked by 
May 2,1990. Mid-Iowa, Oregon, and 
Southern Illinois were the only 
applicants for designation in those areas 
and each applied for the entire area 
currently assigned to that agency. 

The Service announced the applicant 
names in the June 1,1990, Federal 
Register (55 FR 22361) and requested 
comments on the applicants for 
designation. Comments were to be 
postmarked by July 16,1990. One 
comment supporting Southern Illinois' 
designation renewal was received. 

The Service evaluated all available 
information regarding the designation 
criteria in section 7(f)(1)(A) of the Act; 
and in accordance with section 
7(f)(1)(b), determined that Mid-Iowa, 
Oregon, and Southern Illinois are able to 
provide official services in the 
geographic areas for which the Service 
is renewing their designation. 

Effective October 1 , 1990, and 
terminating September 30,1993. Mid- 
Iowa, Oregon, and Southern Illinois are 
designated to provide official inspection 
services in their specified geographic 
areas, as previously described in the 
April 2 Federal Register. 

Interested persons may obtain official 
services by contacting Mid-Iowa at 319- 
363-0239, Oregon at 503-276-0939, and 
Southern Illinois at 618-632-1921. 

Authority: Pub. L 94-582, 90 Stat. 2867. as 
amended (7 U.S.C. 71 et seq.). 

Dated: August 27,1990. 

J. T. Abshier, 

Director. Compliance Division. 

|FR Doc. 90-20594 Filed 8-31-90; 8:45 am) 

BILLING CODE 3410-«n-M 


Request for Designation Applicants to 
Provide Official Services in the 
Geographic Area Currently Assigned 
to the State of Alabama (AL) 

agency: Federal Grain Inspection 
Service (Service). USDA. 
action: Notice. 

summary: Pursuant to the provisions of 
the U.S. Grain Standards Act, as 
Amended (Act), official agency 


designations shall terminate not later 
than triennially and may be renewed 
according to the criteria and procedures 
prescribed in the Act. This notice 
announces that the designation of an 
agency will terminate, in accordance 
with the Act, and requests applications 
from parties interested in being 
designated as the official agency to 
provide official services in the 
geographic area currently assigned to 
the specified agency. The official agency 
is the Alabama Department of 
Agriculture and Industries (Alabama). 
DATES: Applications must be 
postmarked on or before October 4, 

1990. 

ADDRESSES: Applications must be 
submitted to James R. Conrad, Chief. 
Review Branch, Compliance Division, 
FG1S, USDA, room 1647 South Building, 
P.O. Box 96454, Washington. DC 20090- 
6454. All applications received will be 
made available for public inspection at 
this address located at 1400 
Independence Avenue, SW., during 
regular business hours. 

FOR FURTHER INFORMATION CONTACT. 
James R. Conrad, telephone 202-447- 
8525. 

SUPPLEMENTARY INFORMATION: Thi8 
action has been reviewed and 
determined not to be a rule or regulation 
as defined in Executive Order 12291 and 
Departmental Regulation 1512-1; 
therefore, the Executive Order and 
Departmental Regulation do not apply to 
this action. 

Section 7(f)(1) of the Act specifies that 
the Administrator of the Service is 
authorized, upon application by any 
qualified agency or person, to designate 
such agency or person to provide official 
services after a determination is made 
that the applicant is better able than any 
other applicant to provide official 
services in an assigned geographic area. 

Alabama, located at 1445 Federal Dr., 
Montgomery. AL 36193, was designated 
under the Act on March 1 , 1988, as an 
official agency, to provide official 
inspection services and Class X or Class 
Y weighing services. 

The designation of this official agency 
terminates on February 28,1991. Section 
7(g)(1) of the Act states that 
designations of official agencies shall 
terminate not later than triennially and 
may be renewed according to the 
criteria and procedures prescribed in the 
Act. 

The geographic area presently 
assigned to Alabama, pursuant to 
section 7(f)(2) of the Act, which may be 
assigned to the applicant selected for 
designation, is the entire State of 
Alabama, except those export port 
locations within the State. 


Interested parties, including Alabama, 
are hereby given opportunity to apply 
for official agency designation to 
provide the official services in the 
geographic area, as specified above, 
under the provisions of section 7(f) of 
the Act and § 800.196(d) of the 
regulations issued thereunder. 
Designation in each specified geographic 
area is for the period beginning March 1, 
1991, and ending February 28,1994. 
Parties wishing to apply for designation 
should contact the Review Branch, 
Compliance Division, at the address 
listed above for forms and information. 

Applications and other available 
information will be considered in 
determining which applicant will be 
designated to provide official services in 
a geographic area. 

Authority: Pub. L. 94-582. 90 Stat. 2867. as 
amended (7 U.S.C. 71 et seq.) 

Dated: August 27.1990. 

J.T. Abshier. 

Director, Compliance Division. 

|FR Doc. 90-20595 Filed 8-31-90; 8:45 am) 

BILLING COO€ 3410-EN-M 


Request for Comments on the 
Designation Applicants in the 
Geographic Areas Currently Assigned 
to the Decatur (IL) Agency and the 
State of South Carolina (SC) 

agency: Federal Crain Inspection 
Service (Service), USDA. 

ACTION: Notice. 

summary: This notice requests 
comments from interested parties on the 
applicants for official agency 
designation in the geographic areas 
currently assigned to Decatur Crain 
Inspection, Inc. (Decatur), and the South 
Carolina Department of Agriculture 
(South Carolina). 

date: Comments must be postmarked 
on or before October 19,1990. 

addresses: Comments must be 
submitted in writing to Paul Marsden, 
RM. FGIS, USDA, room 0628 South 
Building, P.O. Box 96454, Washington, 
DC 20090-6454. 

SprintMail users may send responses 
to IPMARSDEN/FGIS/USDA], 
Telecopier users may send responses 
to the automatic telecopier machine at 
202-447-4628. attention: Paul Marsden. 
All comments received will be made 
available for public inspection at the 
above address located at 1400 
Indpendence Avenue, SW., during 
regular business hours (7 CFR 1.27(b)). 

FOR FURTHER INFORMATION CONTACT 

Paul Marsden, telephone (202) 475-3428. 


















Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35913 


SUPPLEMENTARY INFORMATION: This 
action has been reviewed and 
determined not to be a rule or regulation 
as defined in Executive Order 12291 and 
Department Regulation 1512-1; 
therefore, the Executive Order and 
Departmental Regulation do not apply to 
this action. 

The Service requested applications for 
official agency designation to provide 
official services within specified 
geographic areas in the July 2,1990, 
Federal Register (55 FR 27277). 
Applications were to be postmarked by 
August 1,1990. Decatur and South 
Carolina were the only applicants for 
designation in those areas, and each 
applied for the entire area currently 
assigned to that agency. 

This notice provides interested 
persons the opportunity to present their 
comments concerning the applicants for 
designation. Commenters are 
encouraged to submit reasons for 
support or objection to this designation 
action and include pertinent data to 
support their views and comments. All 
comments must be submitted to the 
Resources Management Division, at the 
above address. 

Comments and other available 
information will be considered in 
making a final decision. Notice of the 
final decision will be published in the 
Federal Register, and the applicant will 
be informed of the decision in writing. 

Authority: Pub. L. 94-582, 90 Stat. 2887, as 
amended (7 U.S.C. 71 et seq.) 

Dated: August 27,1990. 

J.T. Abshier, 

Director, Compliance Division. 

|FR Doc. 90-20596 Filed 8-31-90; 8:45 am) 

BILLING CODE 3410-EN M 


Request for Comments on the 
Designation Applicants in the 
Geographic Area Currently Assigned 
to the McCrea (IA) Agency 

agency: Federal Grain Inspection 
Service (Service). USDA. 

action: Notice. 

summary: This notice requests 
comments from interested parties on the 
applicant for official agency designation 
in the geographic area currently 
assigned to the John R. McCrea agency 
(McCrea). 

dates: Comments must be postmarked 
on or before October 19,1990. 

addresses: Comments must be 
submitted in writing to Paul Marsden, 
RM, FGIS, USDA, room 0628 South 
Building, P.O. Box 96454, Washington, 
DC 20090-6454. 


SprintMoil users may respond to 
[PMARSDEN / FGIS/ U SD A |. 

Telecopier users may send responses 
to the automatic telecopier machine at 
202-447-4628. attention: Paul Marsden. 
All comments received will be made 
available for public inspection at the 
above address located at 1400 
Independence Avenue, SW., during 
regular business hours (7 CFR 1.27(b)). 
FOR FURTHER INFORMATION CONTACT 
Paui Marsden. telephone (202) 475-3428. 
SUPPLEMENTARY INFORMATION: This 
action has been reviewed and 
determined not to be a rule or regulation 
as defined in Executive Order 12291 and 
Departmental Regulation 1512-1; 
therefore, the Executive Order and 
Departmental Regulation do not apply to 
this action. 

The Service requested applications for 
official agency designation to provide 
official services within a specified 
geographic area in the July 2,1990, 
Federal Register (55 FR 27278). 
Applications were to be postmarked by 
August 1,1990. John R. McCrea Agency. 
Inc., was the only applicant, and applied 
for the entire geographic area. 

This notice provides interested 
persons the opportunity to present their 
comments concerning the applicants for 
designation. Commenters are 
encouraged to submit reasons for 
support or objection to this designation 
action and include pertinent data to 
support their views and comments. All 
comments must be submitted to the 
Resources Management Division, at the 
above address. 

Comments and other available 
information will be considered in 
making a final decision. Notice of the 
final decision will be published in the 
Federal Register, and the applicants will 
be informed of the decision in writing. 

Authority: Pub. L. 94-582. 90 Stat. 2867. as 
amended (7 U.S.C. 71 et seq.) 

Dated: August 27,1990. 

J. T. Abshier, 

Director, Compliance Division. 

[FR Doc. 90-20597 Filed 8-31-90; 8:45 am) 
BILLING COOE 3410-EN-M 


Designation Renewal of the Central 
Iowa (IA) Agency and the States of 
Maine (ME) and Montana (MT) 

Correction 

In FR Doc. 90-17768, beginning on 
page 31204 in the issue of Wednesday. 
August 1,1990, make the following 
correction under ‘supplementary 
information." On page 31204, in the 
second column, in the third complete 
paragraph, the termination date written 
as "termination October 31,1993". 


should read "terminating August 31, 
1993". 

Date: August 27,1990. 

J.T. Abshier, 

Director. Compliance Division. 

|FR Doc. 90-20598 Filed 8-31-90; 8:45 am| 

BILLING COOE 3410~£N-M 


Advisory Committee Meeting 

Pursuant to the provisions of section 
10(a)(2) of the Federal Advisory 
Committee Act (Pub. L. 92-463), notice is 
hereby given of the following committee 
meeting: 

Name: Federal Grain Inspection 
Service Advisory Committee. 

Dote: September 20,1990. 

Place: Radisson Inn Airport, Greater 
Cincinnati Airport, Hebron, Kentucky 
41048. 

Time: 10 a.m. 

Purpose: A subcommittee to review 
and prepare recommendations to the 
Federal Grain Inspection Service 
Advisory Committee on financial 
matters affecting the Federal Grain 
Inspection Service. 

The agenda includes a review of the 
financial status of the Federal Grain 
Inspection Service, an examination of 
cost-cutting measures, a discussion of 
unit versus hourly fees, and a review of 
whether fee adjustments should be 
annually or on some other basis. 

The meeting will be open to the 
public. Public participation will be 
limited to written statements unless 
otherwise requested by the 
Subcommittee Chairman. Persons, other 
than members, who wish to address the 
Subcommittee at the meeting or submit 
written statements before, at, or after 
the meeting should contact Marion 
Hartman, Subcommittee Chairman, 8761 
Dragoo Road, Hillsboro, Ohio 45133, 
telephone (513) 393-2139. 

Dated: August 28,1990. 

D. R. Galliart, 

Acting Administrator. 

[FR Doc. 90-20654 Filed 8-31-90; 8:45 am] 

BILLING COOE 3410-EN-M 


DEPARTMENT OF COMMERCE 

Agency Information Collection Under 
Review by the Office of Management 
and Budget (OMB) 

DOC has submitted to OMB for 
clearance the following proposal for 
collection of information under the 
provisions of the Paperwork Reduction 
Act (44 U.S.C. chapter 35). 


















35914 Federal Register / 

Agency: National Oceanic and 
Atmospheric Administration 
Title: Fish Tagging Report—Southeast 
Region 

Form Number: No form number assigned 
Type of Request: New collection 
Burden: 4,000 respondents; 300 reporting 
hours; average hours per response— 
.036 hours. 

Needs And Uses: Data are needed to 
determine growth rates and migratory 
patterns of billfish and other 
recreational and commercially valued 
species. Anglers volunteer to 
participate in the program. Resulting 
analyses are used to develop fishery 
management plans. 

Affected Public: Individuals or 
households 

Frequency: On occasion 
Respondent's Obligation: Voluntary 
OMB Desk Officer Ronald Minsk. 395- 
7340 

Copies of the above information 
collection proposal can be obtained by 
calling or writing DOC Clearance 
Officer. Edward Michals, (202) 377-3271. 
Department of Commerce, room 6622, 
14th and Constitution Avenue, NW., 
Washington, DC 20230. 

Written comments and 
recommendations for the proposed 
information collection should be sent to 
Ronald Minsk, OMB Desk Officer, room 
3208, New Executive Office Building. 
Washington. DC 20503. 

Dated: August 27.1990. 

Edward Michals. 

Departmental Clearance Officer, Office of 
Management and Organization. 

(FR Doc. 90-20708 Filed 8-31-00; 8:45 ami 

BILLING COO€ 3510-CW-M 


Agency Form Under Review by the 
Office of Management and Budget 
(OMB) 

DOC has submitted to OMB for 
clearance the following proposal for 
collection of information under the 
provisions of the Paperwork Reduction 
Act (44 U.S.C. chapter 35). 

Agency: Bureau of the Census 
Title: Annual Survey of Communication 
Services 

Form Number(s): B-516, B-517. B-518. B- 
519, B-520. B-521 
Agency Approval Number: None 
Type of Request: New collection 
Burden: 4.000 hours 
Number of Respondents: 1.000 
Avg Hours Per Response: 4 hours 
Needs and Uses: The Bureau of the 
Census will use this survey to provide 
key measures of the communication 
sector, including the telephone, 
broadcasting, and cable television 


Vol. 55. No. 171 / Tuesday. September 4. 1990 / Notices 


industries. These data will serve as 
inputs into the national accounts 
calculated by the Bureau of Economic 
Analysis, the Bureau of Labor 
Statistics' consumer and producer 
price indices, and the Department of 
Commerce's publication. Industrial 
Outlook. 

Affected Public : Businesses or other for- 
profit organizations, and Small 
businesses or organizations 
Frequency: Annually 
Respondent's Obligation : Mandatory 
OMB Desk Officer : Don Arbuckle. 395- 
7340 

Copies of the above information 
collection proposal can be obtained by 
calling or writing Edward Michals. DOC 
Clearance Officer. (202) 377-3271. 
Department of Commerce. Room H6622. 
14th and Constitution Avenue. NW.. 
Washington. DC 20230. 

Written comments and 
recommendations for the proposed 
information collection should be sent to 
Don Arbuckle. OMB Desk Officer, Room 
3208, New Executive Office Building. 
Washington. D.C. 20503. 

Dated: August 28.1990 
Edward Michals. 

Department Clearance Officer, Office of 
Management and Organization. 

(FR Doc. 90-20695 Filed 8-31-90;8:45am] 

BILLING CODE 3S10-07-M 


Foreign-Trade Zones Board 
(Docket 35-901 

Foreign-Trade Zone 75— Phoenix. AZ, 
Application for Subzone, Conalr 
Corporation, Glendale, AZ 

An application has been submitted to 
the Foreign-Trade Zones Board (the 
Board) by the City of Phoenix, grantee of 
FTZ 75, requesting special-purpose 
subzone status at the warehousing/ 
manufactuing facilities of Conair 
Corporation, located in Glendale, 
Arizona, adjacent to the Phoenix 
Customs port of entry. The application 
was submitted pursuant to the 
provisions of the Foreign-Trade Zones 
Act. as amended (19 U.S.C. 8la-8lu), and 
the regulations of the Board (15 CFR part 
400). It was formally filed on August 20. 
1990. 

The Conair facility, currently under 
construction, will be located on a 100- 
acre site within the Glen Harbor 
Business Park. Glendale. Arizona. 
Operations at the site will include 
warehousing/distribution, repair and 
assembly/manufacturing of small 
electric heating appliances such as hair 
dryers, curling irons and flat irons; 
electric kitchen appliances, such as food 


processors, blenders, microwave ovens, 
toasters and warming trays; and. 
telephones and answering machines. 

The assembly/manufacturing operations 
will be relocated from plants abroad. 
Initially, a majority of the components 
will be sourced abroad, but the 
company plans to increase U.S. sourcing 
over time. Foreign components will 
include plastic handles and knobs, 
fasteners, blades, fans, electric motors, 
generators, transformers, telephone 
components, microphones, 
loudspeakers, earphones, transformers, 
capacitors, resistors, switches, diodes, 
integrated circuits, timing devices and 
insulators. 

Zone procedures will exempt Conair 
from Customs duty payments on the 
foreign items used in its exports. On its 
domestic sales, the company will be 
able to choose the lower Customs duty 
rates on the finished products (3.4-5.6%). 
The rates on the foreign parts used at 
the plant range from 0 to 12 percent. The 
applicant indicates that zone procedures 
will help improve the international 
competitiveness of the company's U.S. 
operations. 

In accordance with the Board’s 
regulations, an examiners committee 
has been appointed to investigate the 
application and report to the Board. The 
committee consists of Dennis Puccinelli 
(Chairman). Foreign-Trade Zones Staff. 
U.S. Department of Commerce. 
Washington, DC 20230; Mr. Paul 
Rimmer. Deputy Assistant Regional 
Commissioner. U.S. Customs Service. 
Southwest Region. 5850 San Felipe 
Street. Houston. Texas 77057-3012; and 
Colonel Charles S. Thomas. District 
Engineer, U.S. Army Engineer District 
Los Angeles. P.O. Box 2711, Los Angeles, 
California 90053-2325. 

Comments concerning the proposed 
subzone are invited in writing from 
interested parties. They should be 
addressed to the Board’s Executive 
Secretary at the address below and 
postmarked on or before October 22. 
1990. 

A copy of the application is available 
for public inspection at each of the 
following locations: 

Port Director's Officer. U.S. Customs 

Service, 1327 South 27th Street. Sky 

Harbor Airport. Phoenix. Arizona 

85034. 

Office of the Executive Secretay. 

Foreign-Trade Zones Board. U.S. 

Department of Commerce, room 2835, 

14th & Pennsylvania Avenue. NW.. 

Washington. DC 20230. 
















Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Notices 


35915 


Dated: August 27.1990. 

John J. Da Ponte, Jr., 

Executive Secretary. 

|FR Doc. 90-20702 Filed 8-31-90; 8:45 am) 

BILLING COO€ 3510-0S-M 


[Docket 37-90] 

Foreign-Trade Zone 145—Shreveport, 
LA (Shreveport-Bossler City Customs 
Port of Entry), Application for 
Sub 2 one, AT&T Telephone and 
Computer Equipment Plant, 
Shreveport, LA 

An application has been submitted to 
the Foreign-Trade Zones Board (the 
Board) by the Caddo/Bossier Parishes 
Port Commission, grantee of FTZ 145, 
requesting special-purpose subzone 
status for the American Telephone and 
Telegraph Company’s (AT&T) 
manufacturing and distribution facility 
located in Shreveport, Louisiana, 
adjacent to the Shreveport-Bossier City 
Customs Port of entry. The application 
was submitted pursuant to the 
provisions of the Foreign-Trade Zones 
Act, as amended (19 U.S.C. 81a-81u), 
and the regulations of the Board (15 CFR 
part 400). It was formally filed on 
August 23,1990. 

AT&T’s Shreveport plant (2,400 
employees) is currently part of FTZ 145 
(Board Order 370, 53 F.R. 1503,1 /20/88), 
but no approval has yet been given for 
manufacturing activity. The company is 
now planning major manufacturing 
operations under zone procedures, and 
after discussions with District Customs 
officials, it has been decided that 
subzone status would be more suitable. 

The facility is on a 156-acre site 
located at 9595 Mansfield Road (U.S. 
Highway 171) in southwest Shreveport. 

It is the company’s only U.S. facility for 
the manufacture of telephone systems 
for small and large businesses and 
related equipment. In addition, company 
plans call for the manufacture of 
computer equipment, facsimile machines 
and clock radios. Some of the plant’s 
inputs are foreign-sourced including 
electronic components such as 
capacitors, diodes, resistors, transistors, 
integrated circuits, printed circuit 
boards, power supplies, switches and 
connectors; parts of telephones such as 
microphones, ringers and keypads; and 
parts of computer and facsimile 
equipment such as the printed circuit 
boards, power supplies, cathode ray 
tubes, disk drives, keyboards; and, a 
variety of hardware and fasteners. 

Zone procedures would exempt AT&T 
from Customs duty payments on foreign 
items used in its exports. On its 
domestic sales the company would be 


able to pay duties at the rate applicable 
to finished products and components 
(3.7 to 8.5%). The duty rates on the parts 
and materials used in production range 
from 0 percent to 10 percent. The 
application indicates that zone 
procedures will help improve AT&T’s 
international competitiveness. 

In accordance with the Board’s 
regulations, an examiners committee 
has been appointed to investigate the 
application and report to the Board. The 
committee consists of Dennis Puccinelli 
(Chairman), Foreign-Trade Zones Staff, 
U.S. Department of Commerce, 
Washington, DC 20230; Joel R. Mish, 
District Director. U.S. Customs Service, 
South Central Region, 423 Canal Street, 
suite 244, New Orleans. LA 70130; and 
Colonel Francis R. Skidmore, District 
Engineer. U.S. Army Engineer District, 
Vicksburg, P.O. Box 60, Vicksburg, MS 
39181-0060. 

Comments concerning the proposed 
subzone are invited in writing from 
interested parties. They should be 
addressed to the Board's Executive 
Secretary at the address below and 
postmarked on or before October 24, 
1990. 

A copy of the application is available 
for public inspection at each of the 
following locations: 

U.S. Customs Service. Port Director's 
Office, 6125 Interstate Drive, Bay 11, 
Shreveport, Louisiana 71109. 

Office of the Executive Secretary, 
Foreign-Trade Zones Board. U.S. 
Department of Commerce, room 2835, 
14th & Pennsylvania Avenue, NW.. 
Washington, DC 20230. 

Dated: August 27,1990. 

John J. Da Ponte, Jr.. 

Executive Secretary. 

|FR Doc. 90-20701 Filed 8-31-90: 8:45 am| 
BILLING CODE 3510-OS-M 


[Docket 36-90] 

Foreign-Trade Zone 124—LaPlace, LA, 
(Gramercy Customs Port of Entry), 
Application for Subzone, North 
American Shipbuilding, Inc., Lafourche 
Parish, LA 

An application has been submitted to 
the Foreign-Trade Zones Board (the 
Board) by the South Louisiana Port 
Commission (SLPC), grantee of FTZ 124, 
requesting special purpose subzone 
status for the shipyard facilities of North 
American Shipbuilding, Inc. (NASI) in 
Lafourche Parish, Louisiana, adjacent to 
the Gramercy Customs port of entry. 

The application was submitted pursuant 
to the provisions of the Foreign-Trade 
Zones Act, as amended (19 U.S.C. 81a- 
81u), and the regulations of the Board 


(15 CFR part 400). It was formally filed 
on August 21, 1990. 

The shipyard is located on 14 acres at 
Industrial Road and Highway 308 in 
Lafourche Parish, Louisiana. The facility 
employs 200 persons and is used for the 
construction and repair of commercial, 
military and research vessels. A 300 ft. 
Antarctic research vessel with 
icebreaking capacities is currently under 
construction for lease to the National 
Science Foundation. Up to 20 percent of 
the components for the vessel are 
sourced abroad including diesel engines 
and engine parts, pumps, gears, cranes, 
other deck machinery and equipment, 
navaigation equipment, propellers, 
compressor parts, articles of iron/steel, 
and other electronic equipment. 

Zone procedures will help NASI 
reduce production costs on its current 
orders snd compete internationally for 
new contracts. Most of the imported 
components are subject to duties, which 
range from 0 percent to 10 percent, while 
the finished products, as oceangoing 
vessels, are duty free. 

In accordance with the Board's 
regulations, an examiners committee 
has been appointed to investigate the 
application and report to the Board. The 
committee consists of John J. Da Ponte, 

Jr. (Chairman), Director Foreign-Trade 
Zones Staff, U.S. Department of 
Commerce, Washington, DC 20230; Joel 
R. Mish, District Director, U.S. Customs 
Service, South Central Region, 423 Canal 
Street, suite 244, New Orleans. LA 
70130-2341; and. Colonel Richard V. 
Gorski, District Engineer, U.S. Army 
Engineer District New Orleans, P.O. Bex 
60267, New Orleans, LA 70160-0267. 

Comments concerning the proposed 
subzone are invited in writing from 
interested parties. They should be 
addressed to the Board's Executive 
Secretary at the address below and 
postmarked on or before October 22, 
1990. 

A copy of the application is available 
for public inspection at each of the 
following locations: 

U.S. Department of Commerce District 
Office, 432 World Trade Center, 2 
Canal Street, New Orleans, LA 70130. 
Office of the Executive Secretary, 
Foreign-Trade Zones Board, U.S. 
Department of Commerce, room 2835, 
14th & Pennsylvania Avenue NW., 
Washington, DC 20230. 

Dated: August 27,1990. 

John J. Da Ponte, Jr., 

Executive Secretary. 

[FR Doc. 90-20703 Filed 8-31-90; 8:45 am] 

BILLING CODE 3510-DS-M 














35916 


Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Notices 


I Order No. 483) 

Resolution and Order Approving the 
Application of Brown County, 
Wisconsin; for a Foreign-Trade Zone in 
the Green Bay, Wisconsin Area; 
Proceedings of the Foreign-Trade 
Zones Board, Washington, DC; 
Resolution and Order 

Pursuant to the authority granted in 
the Foreign-Trade Zones Act of |une 18. 
1934, as amended (19 U.S.C. 81a-81u), 
the Foreign-Trade Zones Board (the 
Board) adopts the following Resolution 
and Order 

The Board, having considered the 
matter, hereby orders: 

After consideration of the application 
of Brown County, Wisconsin, filed with 
the Foreign-Trade Zones Board on April 
14,1989. requesting a grant of authority 
for establishing, operating, and 
maintaining a general-purpose foreign- 
trade zone in Brown County. Wisconsin, 
within the Green Bay Customs port of 
entry, the Board, finding that the 
requirements of the Foreign-Trade 
Zones Act, as amended, and the Board’s 
regulations are satisfied, and that the 
proposal is in the public interest, 
approves the application except for that 
part of proposed Parcel C, which is 
located outside the boundary of the 
Village of Ashwaubenon (designated C- 
2 in examiners report). 

As the proposal involves open space 
on which buildings may be constructed 
by parties other than the grantee, this 
approval includes authority to the 
grantee to permit the erection of such 
buildings, pursuant to § 400.815 of the 
Board’s regulations, as are necessary to 
carry out the zone proposal, providing 
that prior to its granting such permission 
it shall have the concurrences of the 
District Director of Customs, the U.S. 
Army District F.ngineer. when 
appropriate, and the Board’s Executive 
Secretary. Further, the grantee shall 
notify the Board for approval prior to the 
commencement of any manufacturing 
operation w'ithin the zone. The Secretary 
of Commerce, a Chairman and 
Executive Officer of the Board, is hereby 
authorized to issue a grant of authority 
and appropriate Board Order. 

Whereas . by an Act of Congress 
approved June 18,1934. an Act ‘To 
provide for the establishment, operation, 
and maintenance of foreign-trade zones 
in ports of entry of the United States, to 
expedite and encourage foreign 
commerce, and for other purposes," as 
amended (19 U.S.C. 81a-81u) (the Act), 
the Foreign-Trade Zones Board (the 
Board) is authorized and empowered to 
grant to corporations the privilege of 
establishing, operating, and maintaining 


foreign-trade zones in or adjacent to 
ports of entry under the jurisdiction of 
the United States; 

Whereas , Brown County. Wisconsin 
(the Grantee), has made application 
(Filed April 14,1989, FTZ Docket 7-89. 54 
FR 17801, 4/25/89) in due and proper 
form to the Board, requesting the 
establishment, operation, and 
maintenance of a foreign-trade zone in 
Brown County, Wisconsin, within the 
Green Bay Customs port of entry; 

Whereas . notice of said application 
has been given and published, and full 
opportunity has been afforded all 
interested parties to be heard; and 

Whereas , the Board has found that 
the requirements of the Act and the 
Board's regulations are satisfied; 

A low therefore . the Board hereby 
grants to the Crantee the privilege of 
establishing, operating, and maintaining 
a foreign-trade zone, designated on the 
records of the Board as Foreign-Trade 
Zone No. 167, at the location mentioned 
above and more particularly described 
on the maps and drawings 
accompanying the application in 
Exhibits IX and X (with the exception of 
Site C-2), subject to the provisions, 
conditions, and restrictions of the Act 
and the Regulations issued thereunder, 
to the same extent as though the same 
were fully set forth herein, and also the 
following express conditions and 
limitations: 

Operation of the foreign-trade zone 
shall be commenced by the Grantee 
within a reasonable time from the date 
of issuance of the grant, and prior 
thereto, any necessary permits shall be 
obtained from Federal, State, and 
municipal authorities. 

The Crantee shall allow officers and 
employees of the United States free and 
unrestricted access to and throughout 
the foreign-trade zone site in the 
performance of their official duties. 

The grant does not include authority 
for manufacturing operations, and the 
Grantee shall notify the Board for 
approval prior to the commencement of 
any manufacturing operations within the 
zone. 

The grant shall not be construed to 
relieve the Crantee from liability for 
injury or damage to the person or 
property of others occasioned by the 
construction, operation, or maintenance 
of said zone, and in no event shall the 
United States be liable therefor. 

The grant is further subject to 
settlement locally by the District 
Director of Customs and the District 
Army Engineer with the Grantee 
regarding compliance with their 
respective requirements for the 
protection of the revenue of the United 


States and the installation of suitable 
facilities. 

In witness whereof the Foreign-Trade 
Zone Board has caused its name to be 
signed and its seal to be affixed hereto 
by its Chairman and Executive Officer 
at Washington, DC. this 23rd day of 
August, 1990. pursuant to Order of the 
Board. 

Foreign-Trade Zones Board. 

Robert A. Mosbacber, 

Secretary of Commerce. Chairman and 
Executive Officer. 

Attest: 

John J. Da Ponle, Jr., 

Executive Secretary. 

(FR Doc. 90-20704 Filed 8-31-90; 8:45 am] 

BILUNG COOC 3S10-0S-I4 


International Trade Administration 
(A-588-015) 

Television Receivers, Monochrome 
and Color, From Japan; Final Results 
of Antidumping Duty Administrative 
Reviews 

agency: International Trade 
Administration/Import Administration 
Department of Commerce. 
action: Notice of final results of 
antidumping duty administrative 
reviews. 

summary: On November 3, 1989, the 
Department of Commerce published the 
preliminary results of its administrative 
reviews of the antidumping finding on 
television receivers, monochrome and 
color, from Japan, The reviews cover 
one manufacturer/exporter of this 
merchandise to the United States. Sharp, 
and Five periods from April 1.1981 
through February 28.198a 
W'e gave interested parties an 
opportunity to comment on our 
preliminary results. At Sharp’s request, 
we held a hearing on December 1. 1989. 

Based on our analysis of the 
comments received and the correction of 
certain clerical errors, we have changed 
the final results. The final margins range 
from zero to 4.76 percent. 

EFFECTIVE DATE: September 4,1990. 

FOR FURTHER INFORMATION CONTACT: 
W'endy J. Frankel or Robert Marenick. 
Office of Antidumping Compliance, 
International Trade Administration. U.S. 
Department of Commerce. Washington. 
DC 20230; telephone: (202) 377-3601. 
SUPPLEMENTARY INFORMATION: 

Background 

On November 3,1989, the Department 
of Commerce (the Department) 
published in the Federal Register (54 FR 













Federal Register / Vo!. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35917 


46434) the preliminary results of its 
antidumping duty administrative 
reviews of the antidumping finding on 
television receivers, monochrome and 
color, from Japan (36 FR 4597, March 10. 
1971). We have now completed these 
administrative reviews in accordance 
with section 751 of the Tariff Act of 1930 
(the Tariff Act). 

Sharp failed to provide supplementary 
model match data requested for the fifth, 
sixth, and seventh administrative 
reviews. In our preliminary 
determination for Sharp’s fifth, sixth, 
and seventh administrative reviews we 
used the highest rate from each 
respective period as best information 
available (BIA). However, because of 
the circumstances in this case (see our 
rsponse to Comments 8 and 9). we have 
determined that the use of the most 
adverse BIA is not appropriate. 
Therefore, for these final results we 
have used Sharp’s own rate from the 
fourth administrative review as BIA for 
that company in the fifth, sixth, and 
seventh administrative reviews. 

Scope of Review 

Imports covered by the reviews are 
shipments of television receiving sets, 
monochrome and color, and include but 
are not limited to projection televisions, 
receiver monitors, and kits (containing 
all the parts necessary to receive a 
broadcast television signal and produce 
a video image). Not included are certain 
monitors not capable of receiving a 
broadcast signal, certain combination 
units, and certain subassemblies not 
containing the components essential for 
receiving a broadcast television signal 
and producing a video image. 

The reviews cover one manufacturer/ 
exporter of Japanese television 
receivers, monochrome and color. Sharp 
Corp., and five periods from April t. 

1981 through February 28,1986. 

Analysis of Comments Received 

We invited interested parties to 
comment on the preliminary results. At 
Sharp's request, we held a public 
hearing on December 1,1989. We 
received timely comments from a 
domestic party, Zenith Electronics 
Corp., and from Sharp. After the close of 
the comment period we also received 
comments from Montgomery Ward 8 
Co.. Incorporated and from the United 
Electrical Workers of America, 
Independent; the International 
Brotherhood of Electrical Workers, the 
International Union of Electronic, 
Electrical Salaried, Machine and 
Furniture Workers; and the Industrial 
Union Department (AFL-CIO) (the 
Unions) regarding BIA. We have 


addressed the issue of the use of BIA in 
comments eight and nine. 

We have corrected the following 
inadvertent clerical errors in our 
calculations for the third and fourth 
administrative reviews for Sharp: 
Incorrect amounts for constructed value 
(CV). U.S. transfer price, foreign inland 
freight, foreign brokerage/handling 
charges, U.S. royalty, ocean freight, 
ocean insurance, U.S. inland freight. U.S. 
brokerage and handling charges. U.S. 
packing costs, U.S. indirect selling 
expenses, U.S. commissions, home 
market and U.S. packing expenses, and 
an incorrect formula for U.S. commodity 
tax. In addition, we corrected the 
following programming errors: The 
inadvertent omission of language to 
adjust U.S. price (USP) for export 
selling, general, and administrative 
expenses, an incorrect deduction of 
home market freight expenses from USP. 
and a deduction of the exporter's sales 
price (ESP) offset from foreign market 
value (FMV) before it had been capped 
by the amount of U.S. indirect selling 
expenses. All corrections and sources 
for data used in these final results are 
clearly noted in our Final Determination 
Analysis Memo. 

Comment 1: Zenith argues, with 
respect to Japanese taxes rebated or not 
collected by virtue of exportation, that 
the Department’s metholodolgy resulted 
in two unlawful actions: (1) Failure to 
cap the amount of tax added to USP at 
the amount of tax added to or included 
in the heme market price of the 
comparison model, even assuming full 
pass-through of the tax into home 
market price, and (2) adjusting FMV for 
a difference in circumstances of sale 
quantified as the full amount of the 
difference between the tax added to 
USP and the tax included in the home 
market price. 

Zenith further argues that the 
Department should have implemented 
the ruling of the Court of International 
Trade (CIT) in Zenith Electronics Corp. 
v. United States, 10 CIT 268, 633 F.Supp. 
1382 (1986), appeals dismissed, Fed. Cir. 
Nos. 88-1259 and 88-1260 (1909), by 
capping the tax adjustment to USP at 
the amount of tax added to, or included 
in, the home market price. Zenith also 
contends that, since the CIT prohibited 
the Department from making a 
circumstance-of-sale adjustment under 
19 U.S.C. 1677b(a)(4)(b) to neutralize the 
tax adjustment required by 19 U.S.C. 
1677a(d)(l)(c). the Department should 
not make such an adjustment in this 
case. 

Department's Position: We do not 
agree with the CIT in Zenith but have 
not had an opportunity to appeal the 


issue on its merits. Consistent with our 
long-standing policy, we have not 
attempted to measure the tax “passed 
through” to customers in the Japanese 
market. W'e do not agree that the 
statutory language limiting the amount 
of the adjustment to the amount of the 
commodity tax "added to or included in 
the price” of televisions sold in Japan 
requires the Department to measure the 
incidence of the tax in an economic 
sense. 

We agree that the amount of 
commodity tax forgiven by reason of the 
export of televisions to the United 
States must be added to USP under the 
statute. The tax base in Japan is the ex¬ 
factory price less packing and certain 
rebates. Therefore, to make an 
appropriate "applcs-to-applcs” 
comparison, we used the ex-factory 
price of the U.S. product as the U.S. tax 
base. We calculated the adjustment by 
multiplying the U.S. tax base (less 
packing) by the tax rate and adding the 
result to USP. To avoid artificially 
inflating or deflating margins, we made 
circumstance-of-sale adjustments equal 
to the difference in the tax per unit. See 
our position on Comment 3 in Television 
Receivers, Monochrome and Color, 

From Japan; Final Results of 
Antidumping Administrative Review 
and Determination Not to Revoke in Part 
(54 FR 35517, August 28,1989). 

Comment 2: Zenith argues that the 
Department should take into account the 
average age and balance of each 
account payable relating to home 
market sales, and apply the 
respondents’ short-term interest rate to 
those average ages and balances to 
offset all claimed selling expenses. 
Zenith maintains that the true cost of a 
discount or rebate is the discount or 
rebate amount minus the savings the 
respondent realized by paying the 
rebate or discount after the obligation to 
pay has been incurred. 

Department's Position : We disagree 
with Zenith. Any opportunity cost 
incurred as a result of a discount or 
rebate would have been taken into 
account by the seller in setting the terms 
of the discount or rebate. Therefore, it i? 
unnecessary to impute any additional 
costs. This is in contrast to credit costs 
or inventory carrying costs, where the 
seller does not know how long it will 
take for a customer to pay or how long 
he will store merchandise before it is 
sold. 

Comment 3: Zenith is concerned that 
the respondent has included, and the 
Department has accepted, various 
indirect expenses in the ESP offset to 
FMV which are not selling expenses. 
Zenith urges the Department to require 








35918 


Federal Register / Vol. 55. No. 171 / Tuesday. September 4, 1990 / Notices 


the respondent to demonstrate that each 
home market indirect expense is a 
selling expense. 

Deportment's Position: In this review 
we have followed our practice as stated 
in the final results of previous reviews 
of this order. See Television Receivers, 
Monochrome and Color. From Japan; 
Final Results of Antidumping 
Administrative Review (54 FR 13197. 
April 6,1989, our response to Comment 
3). The pool of indirect selling expenses 
in the home market should include those 
expenses which are similar to the 
expenses incurred by the subsidiary in 
the United States whose function it is to 
sell the merchandise. In this instance, 
the equivalent home market expenses 
include certain general expenses 
associated with selling. 

Comment 4: Zenith argues that the 
Department should include all 
antidumping legal fees as an indirect 
selling expense deduction from ESP. 

Department's Position: We disagree. 

In this review we have followed our 
practice as stated in the final results of 
previous reviews of this order. See 
Television Receivers, Monochrome and 
Color, From Japan; Final Results of 
Antidumping Administrative Review (52 
FR 8940, March 20,1937, our response to 
Comment 3 and 54 FR 13197, April 8, 
1989, our response to Comment 4). As 
stated in our “Study of Antidumping 
Adjustments Methodology and 
Recommendations for Statutory 
Change** (November 1985), we do not 
consider legal fees paid in connection 
with litigation to be an expense related 
to sales made in the period of review. 
We view legal fees incurred at the 
administrative stage of an antidumping 
proceeding as meriting similar treatment 
since they are incurred in defending 
against an allegation of dumping. As 
such, they are not expenses incurred in 
selling merchandise in the United States. 
Further, to deduct antidumping legal 
fees as selling expenses would 
effectively discriminate against those 
respondents who seek legal counsel in 
proceedings before the Department. 

Comment 5: Zenith argues that the 
statute instructs the Department to 
reduce USP by the amount of any 
charges or expenses incidental to 
bringing the merchandise from the 
country of exportation to its place of 
delivery in the United States (section 
72(d)(2)(A) of the Tariff Act). Therefore, 
the Department should reduced USP by 
the amount of estimated antidumping 
duties and any expenses associated 
with paying such duties. 

Department's Position: In this review 
we have followed our position as stated 
in the final results of previous reviews 
of this order. See Television Receivers, 


Monochrome and Color, From Japan; 
Final Results of Antidumping 
Administrative Review (54 FR 13197, 
April 6,1989, our response to Comment 5 
and 54 FR 35517, August 28,1989, our 
response to Comment 12). Like legal 
fees, we do not consider antidumping 
duties to be expenses related to the 
sales under consideration. Given the 
tenuous nature of these estimated rates 
and the possibility that they could be 
zero, we do not consider them to be 
expenses within the meaning of section 
772(d)(2)(A) of the Tariff Act for 
purposes of determining USP. 

Comment 6: Zenith argues that the 
Department has incorrectly offset U.S. 
commissions with indirect selling 
expenses in the home market. Zenith 
argues that commissions paid on U.S. 
sales compensate the recipients for both 
direct and indirect expenses. Unless a 
commission is broken up into its direct 
and indirect components, and the FMV 
offset is capped at only the level of the 
indirect expense element, the 
commission offst to FMV will be 
overstated by the amount of the direct 
expense portion of the U.S. commission. 

Department's Position: In this review 
we have followed our position as stated 
in the final results of previous reviews 
of this order. See Television Receivers, 
Monochrome and Color, From Japan; 
Final Results of Antidumping 
Administrative Review (54 FR 13197, 
April 6,1989, our response to Comment 6 
and 54 FR 35517, August 28,1989, our 
response to Comment 8). Our 
regulations require us to make an 
adjustment for situations in which a 
commission is paid in one market but 
not in the other market. That adjustment 
is limited to “the amount of the other 
selling expenses’* allowed in the other 
market (19 CFR 353.56(b)(l)(1989)). We 
do not interpret our regulations to 
require us to limit the offset only to the 
direct expenses of the recipient of the 
commission. We are concerned with the 
commission expense from the seller’s 
point of view. From the seller’s point of 
view, commissions are a direct expense 
in their entirety. Therefore, we have 
offset the full amount of the commission 
in the United States with the indirect 
selling expenses in the home market. 

Comment 7: Zenith argues that the 
Department severely understates the 
antidumping cash deposit on entered 
merchandise by basing the weighted- 
average margins on statutory USP and 
not on the entered value of the 
merchandise. Upon entry of the 
merchandise into the United States, the 
Customs Service applies the weighted- 
average dumping margin to the declared 
entered value as best information 
available. Zenith argue that because this 


entered value is often less than the 
statutory USP, the absolute dollar 
amount of dumping duty is less than the 
dollar amount that would be the result if 
the margin were based on the statutory 
USP. Therefore, Zenith urges the 
Department to calculate the deposit rate 
as a percentage of the entered value and 
not as a percentage of the statutory USP. 

Department's Position: We disagree 
and in this review we have followed our 
practice as stated in the final results of 
previous review's of this order. See 
Television Receivers, Monochrome and 
Color, From Japan; Final Results of 
Antidumping Administrative Review (52 
FR 8940, March 20.1987, our position in 
response to Comment 7 54 FR 13917, 
April 6,1989, our position in response to 
Comment 7 and 54 FR 35517, August 28, 
1989, our position in response to 
Comment 9). Section 736 of the Tariff 
Act requires the Department to instruct 
U.S. Customs to “assess an antidumping 
duty equal to the amount by w f hich the 
FMV of the merchandise exceeds the 
United States price of the merchandise 

.(9 U.S.C. 673e(a)(l)). At the time 

that the merchandise is entered, USP 
has yet to be determined. Since cash 
deposits of estimated dumping duties 
are required at that time, we instruct 
Customs to require such cash deposits 
based on a percentage of the only value 
available, the entered value. If, after an 
administrative review, the amount of the 
antidumping duties deposited should be 
less than the actual amount to be 
assessed, we will collect interest on the 
difference. 

Comments: Sharp alleges that the 
basis for the Department’s best 
information available (BLA) finding for 
the fifth, sixth, and seventh 
administrative reviews is flawed on 
several grounds. The Department’s 
supplementary questionnaire requested 
cost-of-production data, which Sharp 
did not maintain in the normal course of 
business and could not, therefore, 
assemble in a short period of time. What 
Sharp did maintain is actual material 
cost information, which accounts for 
approximately 85 percent of full 
production costs. Sharp provided this 
information to the Department in a 
timely manner for the fifth through 
seventh administrative reviews. 
Moreover, the Department has since 
completed its model match selections in 
a subsequent review using only material 
costs rather than complete production 
cost data. Therefore, the Department 
cannot now claim that such material 
cost information, absent the remaining 
cost of production information (labor 
and overhead), is inadequate to 









Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35919 


determine the appropriate home market 
comparison models. 

Department's Position : YVe disagree. 
Respondents are required to respond to 
a//of the Department’s information 
requests. See Atlantic Sugar, Ud. v. 
United States, 744 F.2d 1556.1560 (Fed. 
Cir. 1984). Section 776(c) of the Tariff 
Act authorizes the Department to resort 
to BIA when we do not receive a 
complete, accurate, or timely response. 
In determining whether the use of BIA 
was warranted in this administrative 
review, we examined (1) whether 
Sharp’s questionnaire response, dated 
July 10.1986. was incomplete (see 
Olympic Adhesives, Inc . v. United 
States, Slip Op., 89-1387,1,17 (Fed. Cir. 
March 28.1900)); (2) whether the 
Department gave Sharp adequate notice 
to correct any deficiencies contained in 
lhat response (/</.); and (3) whether 
Sharp's deficiency response, dated 
September 12,1986, was itself 
incomplete or untimely. 

Sharp’s model match questionnaire 
response was initially due on June 19, 
1986. On June 17,1986, Sharp submitted 
a letter noting various concerns, but not 
responding to the model match 
questionnaire. On June 19.1986. On June 

17.1986, Sharp submitted a letter noting 
various concerns, but not responding to 
the model match questionnaire. On July 
16,1936, almost one month after the 
original due date, Sharp submitted an 
incomplete model match response. 

Sharp failed to provide the labor and 
overhead portions of the cost of 
manufacture (COM) information, and it 
failed to provide recommendations for 
home market comparison models. Both 
types of information were clearly 
requested in our questionnaire. 
Consequently, on August 13.1986, we 
issued a deficiency letter to Sharp 
requesting the missing information. The 
response to the deficiency letter was 
originally due on September 2,1986. On 
September 9, we extended the 
deficiency response due date to 
September 12,1986, and advised Sharp 
that if the response was not reveived by 
that date we would proceed with BIA 
for assessment purposes. 

On September 12,1986, Sharp 
submited a letter to the Department 
requesting that the Department refrain 
from further activity on the fifth through 
seventh reviews until issuance of a final 
determination regarding revocation for 
Sharp. Although we had afforded Sharp 
ample time to provide the requested 
data, the letter did not contain any of 
the information requested in our August 

13.1986, deficiency letter. The record 
indicates that Sharp did not provide the 
requested data because it believed that 


it would prevail in court, arguing that 
the Department lacked the legal 
authority to conduct the reviews in 
question because they covered periods 
which post-dated Sharp's tentative 
revocation. Sharp could have provided 
the requested information and contested 
its use in a subsequent lawsuit. 
However, the firm chose instead not to 
provide the requested information. 

Because we cannot force a respondent 
to provide information, our only 
recourse with an uncooperative 
respondent is to use BIA in accordance 
with section 776(c) of the Tariff Act. See 
Pistachio Croup v. United States et cL 
Court No. 86-08-01037, Slip Op. 87-110 
(CIT, September 29,1987). However, the 
statute authorizes the Department to 
select BIA in a given case based upon 
the particular circumstances of that 
case. See Ansaldo Component /, S.p.A. v. 
United States, 628 F. Supp. 198, 205 (CIT 
1986); Final Results of Antidumping 
Duty Administrative Review, Steel Jacks 
From Canada, 52 FR 32957 (1987); and 
Replacement Parts for Self-Propelled 
Bituminous Paving Equipment From 
Canada; Final Results of Antidumping 
Duty Administrative Review, 55 FR 
20175, May 15,1990. 

It is our practice to evaluate the 
adequacy of the information in the 
administrative record and the degree of 
cooperation received in exercising our 
discretion to select the appropriate BIA 
in a particular case. See 19 CFR 353.37. 

In our preliminary determination for 
Sharp’s fifth, sixth, and seventh 
administrative reviews, we used as BIA 
the highest rate for any firm from each 
respective period. However, because of 
the circumstances in tills case, we have 
determined that the use of the most 
adverse BIA is inappropriate. Sharp did 
provide material costs and did explain 
that it did not know how to apply the 
cost factors to recommend home market 
comparison models. Sharp pointed out 
in its 1989 prehearing brief that the 
reported material cost9 represented a 
large portion (approximately 85 percent) 
of the COM of each mode), making labor 
and overhead expense less significant 
than material costs in determining 
physical differences in merchandise for 
model match purposes. It is reasonable 
that the cost of materials would 
represent a major portion of the cost of 
manufacture of the product under 
review. Nonetheless, it was necessary to 
apply an overall BIA rate for each 
period because we did not have any 
information to use as BIA for the 
unreported labor and overhead costs 
incurred in producing the subject 
merchandise. 


Therefore, we have determined for 
these final results to use Sharp's own 
rate from the fourth administrative 
review (4.76 percent) as BIA in the fifth, 
sixth, and seventh administrative 
reviews. This BIA rate is in accordance 
with section 776(c) of the Tariff Act and 
19 CFR 353.37 and is sufficient to ensure 
timely submissions in future 
administrative reviews. 

Comment 9: Sharp contests the 
Department's use of BIA for the fifth, 
sixth, and seventh administrative 
review results for that company on the 
grounds that the doctrine of estoppel 
prevents a party from assuming 
contradictory positions in legal 
proceedings. Sharp argues that during 
litigation with Sharp the Department 
took a stance that was contrary to the 
Department's statements in its 
September 22,1988 letter, which 
informed Sharp that the Department 
intended to use BIA for the fifth through 
seventh reviews. According to Sharp, 
the letter clearly implies that the 
Department was expecting information 
for all three periods, not just one period. 
Thus, during the litigation the 
Department contradicted itself in stating 
that Sharp was required to submit 
information for only one administrative 
review (the seventh), rather than for 
three administrative reviews (fifth 
through seventh). 

Sharp contends that the Department 
could have argued that the lawsuit was 
moot because, as a result of the BIA 
determination. Sharp no longer had to 
respond to the questionnaires. Instead 
the Department asserted that Sharp's 
claim of irreparable harm (which was 
the Department’s BIA threat) was 
factually incorrect because Sharp would 
not have to answer questionnaires for 
the fifth and sixth reviews under the 
Department's update policy. Sharp 
argues that for the Department "To 
claim now that the BIA threat was not 
just real but already a fait accompli, is 
to play so fast and loose with the courts, 
the law. and the way we are supposed 
to conduct the business of government 
in this country as to require no further 
comment" See Prehearing Brief of Sharp 
Corporation and Sharp Electronics 
Corporation, submitted to the 
Department on November 22,1989, 
pages 20-21. 

Department's Position: We disagree. 

1 he final decision to use BIA was based 
on Sharp’s refusal to provide the 
requested information. The September 
22.1988 letter did not constitute a final 
decision. By the time that the litigation 
with Sharp began, the Department had 
not issued a preliminary determination, 
let alone a final determination, for 








35920 


Federal Register / Vol. 55. No. 171 / Tuesday. September 4, 1990 / Notices 


Sharp’s fifth through seventh reviews. 
We therefore were not in a position to 
tell the court duiing the litigation, as 
Sharp asserts we should have done, that 
a final decision had been made 
regarding the use of BIA for Sharp for 
the fifth, sixth and seventh reviews. 

On October 26,1986, Sharp sued the 
Department to enjoin reviews of post- 
tentative revocation entries until Sharp’s 
request for revocation was decided. 
After this suit was brought we adopted 
the “update” policy. We agreed to 
suspend [i.e., stay) all reviews covering 
periods after the tentative revocation, 
except for the most recent period (the 
“update" review), until the revocation 
issue was decided. This update review 
for Sharp initially was the seventh 
review, but as for litigation progressed, 
it became the ninth review. 

We ended the suspension of the post- 
tentative reviews after we determined 
that Sharp was not entitled to 
revocation because of margins found in 
the second administrative review. See 
Television Receivers, Monochrome and 
Color, From Japan; Final Results of 
Antidumping Administrative Review (54 
FR 35517, August 28,1989). 

We then proceeded with the third 
through seventh review periods for 
Sharp. In that context we received and 
considered comments from Sharp about 
whether we should use BIA in the fifth, 
sixth, and seventh reviews because of 
Sharp’s previous inadequate responses, 
which we had received before the 
litigation commenced and before the 
update review policy was implemented. 
See Comment 8, supra. Despite the 
September 22,1986 letter, indicating that 
we would use BIA for these periods due 
to Sharp's inadequate and untimely 
responses, we deferred a final decision 
about using BIA until we received and 
considered Sharp’s comments on our 
preliminary results. Those comments 
were submitted on September 1,1989. 
Since, at the time that the litigation with 
Sharp began (October 1986), we had 
made no final decision as to whether to 
use BIA, and had in fact not even 
published the preliminary results of 
review, we were not in a position to 
make any representations to the court 
about a final decision on the particular 
issue of the use of BIA in the seventh 
review. After resuming the reviews in 
1989, we fully considered the record 
including all comments filed and made 
in oral argument before arriving at the 
final determination to use BIA. 

Comment 10: Sharp argues that in the 
third and fourth administrative reviews 
the Department should have used 
Sharp’s prices to its distributors to 
calculate foreign market value, or, 
alternatively, that the Department 


should have granted a level-of-trade 
adjustment for the SG&A expenses of 
the distributors, since all of the 
comparable expenses of Sharp’s U.S. 
distributors were deducted from the 
resale price in the United States. 

Department's Position: In our second 
administrative review of Sharp (August 
28,1989, 54 FR 35517), we determined 
that the distributer-to-dealer level in 
Japan was the appropriate level for price 
comparisons in the United States 
because there was no clear evidence 
that home market sales to the 
company’s related distributors were at 
arms-length. See 19 CFR 353.45 (1989). 
We made the same determination for 
the third and fourth administrative 
reviews based on the same lack of 
evidence. 

There is, therefore, no need for a 
level-of-trade adjustment because sales 
in the United States and the home 
market were compared at the same level 
of trade, i.e., sales from distributors to 
dealers. We have included in the ESP 
offset the indirect SG&A expenses 
incurred by the distributors for the sale 
of home market models, as is our usual 
practice and policy. 

Comment 11: Sharp argues that if the 
Department does not use the prices to 
its distributors for the third and fourth 
administrative reviews, the home 
market indirect selling expense offset 
should include all indirect selling 
expenses incurred by Sharp’s 
distributors. 

Department's Position: We agree. For 
these final results we included both 
corporate and distributors’ indirect 
selling expenses in the offset for home 
market indirect selling expenses. 

Comment 12: Sharp argues that for the 
third and fourth administrative reviews 
the Department must recalculate U.S. 
indirect expenses to include commission 
expenses on U.S. sales for the purpose 
of applying the offset. 

Department's Postion: In this case, 
commissions were paid only in one of 
the markets under consideration, the 
United States. Therefore, in accordance 
with 19 CFR 353.56(b) (1989). we 
subtracted both U.S. indirect expenses 
and U.S. commission expenses from 
USP and deducted from FMV the 
amount of home maket indirect selling 
expenses limited by the amount of 
indirect selling expenses plus 
commissions incurred for U.S. sales. 

Comment 13: Sharp argues that for the 
third and fourth administrative reviews 
the Department must recalculate U.S. 
indirect expenses to include all the 
expenses of moving television receivers 
from factory sites in Japan to U.S. 
warehouses. 


Department's Position: We do not 
agree. The statute states that USP shall 
be reduced by the amount included in 
such price attributable to any movement 
charges. The Department considers 
charges incident to bringing the 
merchandise from the place of shipment 
in the country of exportation to the 
place of delievery in the United States to 
be movement expenses, not indirect 
selling expenses. We deduct movement 
expenses from the selling prices in the 
United States (19 U.S.C. 772(d) (2) (A)) 
and the home market (19 U.S.C. 773(a)) 
to ensure “apples-to-apples” 
comparisons. 

Comment 14: Sharp argues that the 
method used to calculate the commodity 
tax adjustment to USP for the third and 
fourth administrative reviews is 
erroneous. To derive and ex-factory 
price the Department subtracted ocean' 
freight and marine insurance from a 
transfer price which included neither, 
and a packing cost which improperly 
included packing labor costs instead of 
just packing material costs. 

Department's Position: We agree and 
have made the appropriate changes. 

Comment 15: Sharp contests the 
Department’s use of constructed value 
as FMV for three models in the third and 
fourth review periods. Sharp claims the 
Department’s contention that “quantities 
of such or similar merchandise sold in 
the home market were insufficient” is 
unsupported by the record since the 
Department had previously made 
comparable model selections for all 
models exported to the United States 
during the third and fourth 
administrative reviews. 

Department's Position: Sharp’s 
contention that we had originally 
selected home market models for 
comparison with all models exported to 
the United States during these review 
periods is correct. However, upon 
further examination of our selections we 
determined that three of the selected 
home market models were inappropriate 
for comparison purposes. With respect 
to export model 19H600 and the initially 
selected home market comparison 
model, we noted during the course of the 
review that the cost differences 
attributable to the physical differences 
between these two models was more 
than 30 percent. We consider a home 
market model that differs by more than 
20 percent in cost to be dissimilar for 
comparison purposes in these reviews. 

As for the other two models in question, 
XR-3019 and XR-3013, we have 
determined in accordance with section 
771(16) of the Tariff Act that the models 
originally selected for comparison 
purposes could not reasonably be 












Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35921 


compared because of numerous 
significant dissimilarities in the models* 
features and specifications when 
compared with the export models. 
Therefore, for these three models we 


used CV to determine FMV. 

Final Results of Review 

As a result of the comments received 
and the correction of certain clerical 


errors, we have revised our preliminary 
results for Sharp, and we determine the 
margins to be: 


Manufacturer 

Re- 

view 

no. 

Period of review 

Margin 

(per¬ 

cent) 

Sharp. . 

3 

04/01 /81 —03/31 /82........ 

0.49 


4 

04/01/82—03/31/83. 

4.76 


5 

04/01 /83—03/31 /84____ 

4.76 


6 

04/01/84—02/28/85.... 

4.76 


7 

04/01/85—02/28/86. 

4.76 


The Department will instruct the U.S. 
Customs Service to assess antidumping 
duties on all appropriate entries. 
Individual differences between United 
States price and foreign market value 
may vary from the percentages stated 
above. The Department will issue 
appraisement instructions directly to the 
Customs Service. 

Further, as provided for by section 
751(a)(1) of the Tariff Act, a cash deposit 
of estimated antidumping duties of 4.76 
percent will be required for Sharp. For 
any shipments of this merchandise 
manufactured by Funai Electric, Fujitsu 
General Ltd., Hitachi Ltd., Matsushita 
Electric Industrial Corporation, 
Mitsubishi Electric Corporation, NEC, 
Sanyo Electric Company, Ltd., Toshiba, 
or Victor Company of Japan, the cash 
deposit will continue to be the same as 
the rates published in the final results of 
the last administrative review for these 
firms (Hitachi and Sanyo: 54 FR 35517, 
August 28,1989; Matsushita and Victor 
54 FR 13917. April 6,1989; Fujitsu 
General and Mitsubishi: 53 FR 4050, 
February 11,1988; Funai, NEC, and 
Toshiba: 55 FR 2399, January 24,1990). 

For any future entries of this 
merchandise from a new exporter, not 
covered in this or prior reviews, whose 
first shipment occurred after February 
28,1989, and who is unrelated to any 
reviewed firm or any previously 
reviewed firm, a cash deposit of 
estimated antidumping duties of 26.94 
percent shall remain in effect. This is the 
rate for Matsushita in the eighth review 
period (54 FR 13917, April 6,1989). These 
deposit requirements are effective for all 
shipments of Japanese television 
receivers, monochrome and color, 
entered, or withdrawn from warehouse, 
for consumption on or after the date of 
publication of this notice and shall 
remain in effect until publication of the 
final results of the next administrative 
review. 


This administrative review and notice 
are in accordance with section 751(a)(1) 
of the Tariff Act (19 U.S.C. 1675(a)(1)) 
and 19 CFR 353.22 (1989). 

Dated: August 24,1990. 

Francis J. Sailer, 

Acting Assistant Secretary for Import 
Administration. 

(FR Doc. 90-20697 Filed 8-31-90; 8:45 am] 
BILLING CODE 3510-DS-M 


[C-333-401] 

Cotton Shop Towels From Peru Intent 
to Terminate Suspended Investigation 

AGENCY: International Trade 
Administration/Import Administration, 
Department of Commerce. 
action: Notice of intent to terminate 
suspended investigation. 

summary: The Department of 
Commerce is notifying the public of its 
intent to terminate the suspended 
countervailing duty investigation on 
cotton shop towels from Peru. Interested 
parties who object to this termination 
must submit their comments in writing 
not later than September 30,1990. 
EFFECTIVE DATE: September 4, 1990. 

FOR FURTHER INFORMATION CONTACT: 
Megan Pilaroscia or Barbara Williams, 
Office of Agreements Compliance, 
International Trade Administration, U.S. 
Department of Commerce, Washington, 
DC 20230; telephone: (202) 377-3793. 
SUPPLEMENTARY INFORMATION: 

Background 

On September 12,1934, the 
Department of Commerce ("the 
Department") published an agreement 
suspending the countervailing duty 
investigation on cotton shop towels from 
Peru (49 FR 35835). The Department has 
not received a request to conduct an 
administrative review of the agreement 


suspending the countervailing duty 
investigation on cotton shop towels from 
Peru for Five consecutive annual 
anniversary months. This is the sixth 
anniversary. 

The Department may terminate a 
suspended investigation if the Secretary 
of Commerce concludes that a 
suspension agreement is no longer of 
interest to interested parties. 
Accordingly, as required by the 
Commerce Department's regulations (19 
CFR 355.25(d)(4)), the Department i 9 
notifying the public of its intent to 
terminate this suspended investigation. 

Opportunity to Object 

Not later than September 30,1990, 
interested parties, as defined in 
§ 355.2(i) of the Department’s 
regulations, may object to the 
Department’s intent to terminate this 
suspended investigation. 

Seven copies of any such objections 
should be submitted to the Assistant 
Secretary for Import Administration, 
International Trade Administration, 
room B-099, U.S. Department of 
Commerce, Washington, DC 20230. 

If interested parties do not request an 
administrative review or object to the 
Department’s intent to terminate by 
September 30,1990, we shall conclude 
that the suspended investigation is no 
longer of interest to interested parties 
and shall proceed with the termination. 

This notice is in accordance with 
§ 355.25(d) of the Department’s 
regulations. 

Dated: August 4,1990. 

Eric I. Garfinkel, 

Assistant Secretary for Import 
Administration. 

[FR Doc. 90-20698 Filed 8-31-90; 8:45 am] 
BILLING CODE 3510-OS-N 

























35922 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


IC-331-601I 

Certain Fresh Cut Flowers From 
Ecuador; Final Results of 
Countervailing Duty Administrative 
Review 

agency: International Trade 
Administration/Import Administration 
Department of Commerce. 

action: Notice of Final Results of 
Countervailing Duty Administrative 
Review. 


summary: On June 13.1990, the 
Department of Commerce published the 
preliminary results of its administrative 
review of the countervailing duty order 
on certain fresh cut flowers from 
Ecuador. We have now completed that 
review and determine the total bounty 
or grant to be zero for two firms and 1.60 
percent ad valorem for all other firms 
for the period October 27,1986 through 
December 31.1986, and zero for one firm 
and 2.77 percent ad valorem for all other 
firms for the period January 1.1987 
through December 31.1987. 

EFFECTIVE date: September 4.1990. 

FOR FURTHER INFORMATION CONTACT: 

Lorenza Olivas or Maria MacKay. Office 
of Countervailing Compliance, 
International Trade Administration. U.S. 
Department of Commerce, Washington, 
DC 20230; telephone: (202) 377-2786. 
SUPPLEMENTARY INFORMATION: 
Background 

On June 13,1990. the Department oF 
Commerce (the Department) published 
in the Federal Register (55 FR 23956) the 
preliminary results of its administrative 
review of the countervailing duty order 
on certain fresh cut flowers from 
Ecuador (52 FR 1361; January 13.1987). 
The Department has now completed that 
administrative review in accordance 
with section 751 of the Tariff Act of 
1930, as amended (the Tariff Act). 

Scope of Review > 

Imports covered by this review are 
shipments of Ecuadorian fresh cut 
miniature (spray) carnations, provided 
for during the review period under item 
192.17 of the Tariff Schedules of the 
United States (TSUS), and standard 
carnations, standard chrysanthemums 
and pompon chrysanthemums, provided 
for during the review period under item 
192.21 of the TSUS. This merchandise is 
currently classifiable under items 
0603.10.30. 0603.10.70 and 0603.10.80 of 
the Harmonized Tariff Schedule (1 ITS). 
The TSUS and HTS item numbers are 
provided for convenience and Customs 
purposes. The written description 
remains dispositive of the scope. Daisies 


are excluded from the scope of the 
countervailing duty order. 

The review covers the period October 
27,1986 through December 31.1987 and 
eight programs: (1) Tax credit 
certificates for exports; (2) Fund for the 
Development of Exportable Production: 
(3) FOPEX export credit; (4) tax 
deduction for new investments; (5) tax 
holidays; (6) tax deductions for transfer 
of real estate; (7) sales and income tax 
deductions; and (8) government 
refinancing of public debt. 

Analysis of Comments Received 

We gave interested parties an 
opportunity to comment on the 
preliminary results. We received no 
comments. 

Final Results of Review 

As a result of our review, we 
determine the total bounty or grant to be 
zero for Flores del Ecuador. S.A., and 
Empagri, S.A., and 1.60 percent ad 
valorem for all other firms for the period 
October 27,1986 through December 31, 
1988, and zero for FIore9 del Ecuador, 
S.A.. and 2.77 percent ad valorem all 
other firms for the period January 1,1987 
through December 31,1987. 

Section 707 of the Tariff Act provides 
that the difference between the amount 
of a cash deposit, or the amount of any 
bond or security, for an estimated 
countervailing duty in the preliminary 
determination in the investigation and 
the duty determined under a 
countervailing duty order shall be 
disregarded to the extent that the 
estimated duty is lower than the duty 
determined under the order, which was 
published on January 13.1987. The rate 
in our preliminary determination (51 FR 
37931; October 27.1986) was 1.32 
percent ad valorem. 

Therefore, the Department will 
instruct the Customs Service to 
liquidate, without regard to 
countervailing duties, shipments of this 
merchandise from Flores del Ecuador, 
S.A., and Empagri, S.A., and to assess 
countervailing duties of 1.32 percent of 
the f.o.b. invoice price on shipments of 
this merchandise from all other firms 
entered, or withdrawn from warehouse, 
for consumtpion on or after October 27. 
1986 and exported on or before 
December 31.1986. Further, the 
Department will instruct the Customs 
Service to liquidate, without regard to 
countervailing duties, shipments of this 
merchandise from Flores del Ecuador. 
S.A.. and to assess countervailing duties 
of 1.32 percent of the f.o.b. invoice price 
on shipments of this merchandise from 
all other firms exported on or after 
(anuary 1,1987 and entered, or 
withdrawn from warehouse, for 


consumption on or before January 12. 
1987. The Department further will 
instruct the Customs Service to 
liquidate, without regard to 
countervailing duties, shipments of this 
merchandise from Flores del Ecuador. 
S.A., and to assess countervailing duties 
of 2.77 percent of the f.o.b. invoice price 
on shipments of this merchandise from 
all other firms entered, or withdrawn 
from warehouse, for consumption on or 
after January 13, 1987 and exported on 
or before December 31,1987. 

The Department will also instruct the 
Customs Service to waive cash deposits 
of estimated countervailing duties on 
shipments of this merchandise from 
Flores del Ecuador. S.A.. and to collect a 
cash deposit of 2.77 percent of the f.o.b. 
invoice price on shipments from all 
other firms entered, or withdrawn from 
warehouse, for consumption on or after 
the date of publication of this notice. 
This deposit requirement shall remain in 
effect until publication of the final 
results of the next administrative 
review. 

This administrative review and notice 
are in accordance with section 751(a)(1) 
of the Tariff Act (19 U.S.C. 1675(a)(1)) 
and 19 CFR 355.22. 

Dated: August 22.199a 
Marjorie A. Chorlms, 

Acting Assistant Secretary for Import 
A dministration. 

[FR Doc. 90-2065)6 Filed 8-31-90; 8:45 am| 
BILLING COOE 3510-DS-U 


National Oceanic and Atmospheric 
Administration 

Evaluation of State Coastal 
Management Programs and National 
Estuarine Research Reserve 

agency: National Oceanic and 
Atmospheric Administration, National 
Ocean Service. Office of Ocean and 
Coastal Resource Management, 
Commerce. 

ACTION: Notice of availability of 
evaluation findings. 

summary: Notice hereby given of the 
availability of the evaluation findings 
for (1) Northern Mariana Islands 
Coastal Management Program, and (2) 
the Pacific Coastal Interstate 
Coordination Grants awarded to the 
National Coastal Resources Research 
and Development Institute. Section 312 
of the Coastal Zone Management Act of 
1972, as amended (CZMA), requires a 
continuing review of the performance of 
each coastal state (defined to include 
the Commonwealth of the Northern 
Mariana Islands) with respect to funds 











Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Notices 


35923 


authorized under the CZMA and to the 
implementation of its federally approved 
Coastal Management Program. The state 
evaluated was found to be adhering to 
the programmatic terms of its financial 
assistance awards and to its approved 
coastal management program; and it 
was found to be making progress on 
award tasks, special award conditions, 
and significant improvement tasks 
aimed at program implementation and 
enforcement, as appropriate. 
Accomplishments in implementing the 
coastal management program were 
occurring with respect to the national 
coastal management objectives 
identified in section 303(2)(A)— (I) of the 
CZMA. The Pacific Coastal Interstate 
Coordination Grants awarded to the 
National Coastal Resources Research 
and Development Institute included a 
number of grants awards funded under 
section 309 of the CZMA designed to 
foster interstate coordination and 
address priority coastal management 
problems. A copy of these findings may 
be obtained upon request from: Richard 
B. Mieremet, Acting Evaluation Officer, 
Policy Coordination Division, Office of 
Ocean and Coastal Resource 
Management, National Ocean Service, 
NOAA, 1825 Connecticut Avenue, NW., 
Washington, DC 20235 (202/673-5100). 

(Federal Domestic Assistance Catalog 11.419 
Coastal Zone Management Program 
Administration) 

Dated: August 23,1990. 

Virginia K. Tippie, 

Assistant Administrator for Ocean Services 
and Coastal Zone Management 
[FR Doc. 90-20640 Filed 8-31-90; 8:45 am] 
BILLING CODE 3510-03-M 


Louisiana Coastal Management 
Program; Intent To Evaluate 
Performance 

agency: National Oceanic and 
Atmospheric Administration, National 
Ocean Service, Office of Ocean and 
Coastal Resource Management. 
Commerce. 

action: Notice of intent to evaluate. 

summary: The National Oceanic and 
Atmospheric Administration, National 
Ocean Service, Office of Ocean and 
Coastal Resource Management (OCRM). 
announces its intent to evaluate from 
October 1 through December 31.1990, 
the performance of the Louisiana 
Coastal Management Program (CMP), 
the Washington CMP, the New York 
CMP, and the Puerto Rico CMP, and the 
performance of the Chesapeake Bay 
(Maryland) and Padilla Bay 
(Washington) National Estuarine 
Research Reserves (NERRs). Evaluation 


of coastal management programs will be 
conducted pursuant to section 312 of the 
Coastal Zone Management Act of 1972, 
as amended (CZMA), which requires a 
continuing review of the performance of 
coastal states with respect to coastal 
management, including detailed findings 
regarding the extent to which the state 
has implemented and enforced the 
program approved by the Secretary of 
Commerce, addressed the coastal 
management needs identified in section 
303(2) (A) through (I) of the CZMA, and 
adhered to the terms of any grant, loan 
or cooperative agreement funded under 
the CZMA. Evaluation of the National 
Estuarine Research Reserves will be 
conducted pursuant to section 315(f) of 
the CZMA, which requires the periodic 
review of the performance of each 
reserve with respect to its operation and 
management. The reviews involve 
consideration of written submissions, a 
site visit to the state, and consultations 
with interested Federal, state and local 
agencies and with members of the 
public. Public meetings will be held as 
part of the site visits. The respective 
state will issue notice of these meetings. 
Copies of each state’s most recent 
performance report, as well as OCRM’s 
notification letter and supplemental 
information request letter to the state, 
are available upon request from the 
OCRM. Written comments from all 
interested parties on each of these 
programs are encouraged at this time. 
Please direct comments to Richard B. 
Mieremet (see further information 
contact below). OCRM will place a 
subsequent notice in the Federal 
Register announcing the availability of 
the Final Findings based on each 
evaluation. 

FOR FURTHER INFORMATION CONTACT: 

Richard B. Mieremet, Acting Evaluation 
Officer, Policy Coordination Division, 
Office of Ocean and Coastal Resource 
Management, National Ocean Service, 
NOAA, 1825 Connecticut Avenue, NW., 
Washington, DC 20235 (202/673-5100). 

Dated: August 23,1990. 

(Federal Domestic Assistance Catalog 11.419, 
Coastal Zone Management Program 
Administration) 

Virginia K. Tippie, 

Assistant Administrator for Ocean Services 
and Coastal Zone Management 
[FR Doc. 90-20461 Filed 8-31-90, 8:45 am) 
BILLING CODE 3510-08 


Marine Mammals; Application for 
Scientific Research Permit (P77#44) 

agency: National Marine Fisheries 
Service, NOAA, DOC. 


action: Application for Scientific 
Research Permit (P77#44). 

Notice is hereby given that an 
applicant has applied in due form for a 
scientific research permit to take marine 
mammals as authorized by the Marine 
Mammal Protection Act of 1972 (16 
U.S.C. 1361-1407) and the Regulations 
Governing the Taking and Importing of 
Marine Mammals (50 CFR part 216). 

1. Applicant: Dr. Howard W. Braham, 
Director, Alaska Fisheries Science 
Center, NMFS, NOAA, National Marine 
Mammal Laboratory, 7600 Sand Point 
Way. NE., Bldg. 4, Seattle, WA 98115. 

2. Type of Permit' Scientific Research. 

3. Number and Name of Marine 
Mammals: Up to 2,600 California sea 
lions [Zalopbus californianus). 

4. Type of Take: The applicant 
proposes to take up to 2,500 pups of 
either sex (500 annually). The pups will 
be captured, handled, branded, or 
tagged and branded and released. Pups 
will be 3-5 months old at the time of 
capture. Up to 100 adult female sea lions 
(up to 50 in year one, 25 in year 2, and 25 
in year 3) will be captured, instrumented 
with radio transmitters or 
microprocessor-controlled depth 
recorders, tagged, branded, given 
enemas and released at the capture site 
to evaluate movements and foraging 
behavior of adult females during the 
non-breeding season (from September to 
April). An unspecified number of 
California sea lions may be disturbed 
associated with the types of take 
specified above in addition to aerial and 
ground surveys and during 9cat 
collection on haulout areas. Taking will 
be conducted on San Miguel Island, 
California. A permit is requested for the 
five-year period from September 1990 
through December 1995. 

Concurrent with the publication of 
this notice in the Federal Register, the 
Secretary of Commerce is forwarding 
copies of this application to the Marine 
Mammal Commission and the 
Committee of Scientific Advisors. 

Written data or views, or requests for 
a public hearing on this application 
should be submitted to the Assistant 
Administrator for Fisheries, National 
Marine Fisheries Service, U.S. 
Department of Commerce, 1335 East 
West Highway, Room 7330, Silver 
Spring, Maryland 20910, within 30 days 
of the publication of this notice. Those 
individuals requesting a hearing should 
set forth the specific reasons why a 
hearing on this particular application 
would be appropriate. The holding of 
such hearing is at the discretion of the 
Assistant Administrator for Fisheries. 
All statements and opinions contained 














35924 


Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Notices 


in this application are summaries of 
those of the applicant and do not 
necessarily reflect the views of the 
National Marine Fisheries Service. 

Documents submitted in connection 
with the above application are available 
for review by interested persons in the 
following offices: 

Office of Protected Resources. National 
Marine Fisheries Service, 1335 East 
West Highway, Room 7330, Silver 
Spring, Maryland 20910; 

Director, Alaska Region. National 
Marine Fisheries Service, NOAA, 709 
West 9th Street. Federal Bldg., Juneau. 
Alaska 99802; 

Director, Northwest Region, National 
Marine Fisheries Service, NOAA, 7600 
Sand Point Way, NE.. BiN C15700, 
Seattle, Washington 98115; and 
Director, Southwest Region. National 
Marine Fisheries Service, NOAA, 300 
South Ferry Street, Terminal Island, 
California 90731-7415. 

Dated: August 27.1990. 

Nancy Foster, 

Director, Office of Protected Resources. 
National Marine Fisheries Service. 

[FR Doc. 90-20670 Filed 8-31-90; 8:45 ami 

BILLING COOE 3510-22-M 


National Marine Fisheries Service, 
Marine Mammals; Application for 
Permit; Susan H. Shane, Ph.D. [P127D] 

Notice is hereby given that an 
Applicant has applied in due form for a 
Scientific Research Permit to take 
marine mammals as authorized by the 
Marine Mammal Protection Act of 1972 
(16 U.S.C. 1361-1407} and the 
Regulations Governing the Taking and 
Importing of Marine Mammals (50 CFR 
part 216). 

1. Applicant: Susan H. Shane, Ph.D, 
250 Cottini Way, Santa Cruz, CA 95060. 

2. Type of Permit 0 Scientific research 
under the Marine Mammal Protection 
Act. 

3. Name: Atlantic bottlenose dolphin 
(Tursiops truncatus }. 

4. Type of Take and Numbers: The 
Applicant is requesting to take up to 75 
Atlantic bottlenose dolphin each day by 
harassment. An individual dolphin may 
be taken more than once (a maximum of 
50 days/year/dolphin). The purposes of 
the proposed research are: (1) Record 
diurnal activities and correlate these 
with environmental conditions; (2) 
identify different types of feeding 
behavior and associate these with 
environmental variables; (3) observe 
long-term associations between 
identifiable individuals; and (4) record 
apparent calving intervals of 
recognizable females. 


5. Location and Duration of Activity: 
The requested activity would occur at 
Sanibel and Captiva Islands, Florida. 

The duration of the requested activity is 
for a period of five (5) years. 

Concurrent with the publication of 
this notice in the Federal Register, the 
Secretary of Commerce is forwarding 
copies of this application to the Marine 
Mammal Commission and the 
Committee of Scientific Advisors. 

Written data or views, or requests for 
a public hearing on this application 
should be submitted to the Assistant 
Administrator for Fisheries, National 
Marine Fisheries Service. U.S. 
Department of Commerce, 1335 East 
West Highway, Silver Spring, Maryland 
20910, within 30 days of the publication 
of this notice. Those individuals 
requesting a hearing should set forth the 
specific reasons why a hearing on this 
particular application would be 
appropriate. The holding of such a 
hearing is at the discretion of the 
Assistant Administrator for Fisheries. 

All statements and opinions contained 
in this application are summaries of 
those of the Applicant and do not 
necessarily reflect the views of the 
National Marine Fisheries Service. 

Documents submitted in connection 
with the above application are available 
for review by appointment at the 
following offices: 

Office of Protected Resources, National 
Marine Fisheries Service, 1335 East 
West Highway, room 7324, Silver 
Spring, MD 20910 (301 427-2289); 
Director, Southwest Region, National 
Marine Fisheries Service, 300 South 
Ferry Street, Terminal Island. CA 
90731 (213 514-6196); and 
Director, Southeast Region, National 
Marine Fisheries Service, 9450 Roger 
Boulevard, St. Petersburg, FL 33702 
(813/893-3141). 

Dated: August 27,1990. 

Nancy Foster, 

Director ; Office of Protected Resources, 
National Marine Fisheries Service. 

[FR Doc. 90-20671 Filed 8-31-90; 8:45 am| 

BILLING CODE 3510-22-11 


Permits; Marine Mammals; Correction 

agency: National Marine Fisheries 
Service (NMFS), NOAA, DOC 
action: Marine Mammals; Notice of 
correction. 

summary: This notice corrects 
Modificaiton No. 1 to Permit No. 595 
(P112F) (notice document 90-19329) that 
was published in the Federal Register on 
August 17.1990 (55 FR 33742), paragraph 
5 is revised as follows: 


“5. The authority to acquire the marine 
mammals authorized herein shall 
extend from the date of issuance 
through December 31.1993. . . 
Dated: August 27.1990. 

Nancy Foster, 

Director, Office of Protected Resources, 

National Marine Fisheries Service. 

[FR Doc. 90-20672 Filed 8-31-90; 8:45 ara[ 

BILUNG CODE 3510-22-41 


COMMISSION ON THE BICENTENNIAL 
OF THE UNITED STATES 
CONSTITUTION 

[CFDA No. 90.001] 

Invitation for Applications for New 
Awards for FY 1991 Bicentennial 
Educational Grant Program 

agency: Commission on the 
Bicentennial of the United States 
Constitution. 

action: Notice inviting applications and 
providing application forms for 
Bicentennial Educational Grant Program 
for fiscal year 1991. 

summary: The Commission on the 
Bicentennial of the United States 
Constitution announces its application 
deadline for FY 1991 funding from its 
Constitution Bicentennial Educational 
Grant Program. The Commission is 
soliciting grant applications for the 
development of instructional materials 
and programs on the Constitution and 
Bill of Rights which are designed for use 
by elementary or secondary school 
students. Thi9 grant program notice 
informs all interested individuals and 
organizations about the closing date for 
the receipt of applications for funding. 
The application conditions are based on 
the law and regulation which contain 
the key requirements for all applicants 
to follow in seeking funding from the 
Commission. 

dates: The dosing for the receipt of 
applications in the FY 1991 competition 
is November 19.1990. Applications 
delivered by hand must be received at 
the offices of the Commission no later 
than 5:00 p.m. on November 19.1990. 
Applications by mail must be 
postmarked no later than November 19. 
1990. 

ADDRESSES: For further information 
contact: 

Anne A. Fickiing, Associate Director of 
Educational Programs. Commission on 
the Bicentennial of the U.S. 
Constitution. 808 17th Street, NW„ 
Suite 800, Washington. DC 20006, (202) 
653-5110. 
















Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Notices 


35925 


SUPPLEMENTARY INFORMATION: The 

objective of this program is to help 
elementary and secondary school 
teachers develop a better understanding 
of the history and development of the 
U.S. Constitution and Bill of Rights and 
to provide them with materials and 
methods so they will become more able 
to teach the Constitution to young 
learners. Programs designed to affect 
students directly are also encouraged. 
Programs designed for adult learners in 
an elementary or secondary school 
environment are also eligible. The 
Commission continues to encourage 
proposals from non-traditional 
educational organizations and those 
concerned with ethnic and minority 
interests, people for whom English is a 
second language, and other special 
interest organizations such as those 
concerned with the learning disabled 
and the physically handicapped. 

Available funds anticipated: 
Approximately $1.8 million. 

Estimated range of awards: $3,000- 
$125,000. 

Estimated number of awards: 25-35. 

Project period: No longer than 16 
months, beginning no later than 
September 1.1991. 

Priority areas for funding: The 
Program Announcement and Final Rule 
governing the Bicentennial Educational 
Grant Program were published in the 
Federal Register on August 14,1987. 
Specifically, the Commission encourages 
proposals which focus on themes 
paralleling those of the Commission’s 
five-year plan and the development of 
the three branches of government. In 
1991 Educational Grant Program, the 
Commission’s focus is on the Bill of 
Rights and subsequent Amendments. 

Limited funding is available for 
expanding, replicating, or continuing 
highly successful edcuational programs 
which effectively link the Constitution to 
civic literacy and responsibility today. A 
significant aspect of any such program 
would be the inclusion of a co-curricular 
activity and/or community involvement 
component. The Commission encourages 
applications for funding these 
exemplary projects from schools, school 
districts, or organizations. A well- 
developed dissemination plan should be 
included in any proposal for funding 
under this initiative. 

Selection criteria: The Commission 
has developed the following criteria as 
general guidelines for judging all project 
proposals: 

1. The project is designed to 
strengthen teachers' capacity to 
understand and teach the Constitution, 
its antecedents, provisions, structure, 
and history, while benefitting students 


in an academically sound way 
appropriate for the age group toward 
which it is directed. (15 points) 

2. The project has potential to make 
effective and appropriate use of existing 
and proven curricular materials, 
including those made available through 
Commission sponsorship and the 
Bicentennial Educational Grants 
Program. (5 points) 

3. The project is cost-effective in that 
expenditures are reasonable and 
appropriate for the scope of the project. 
(5 point) 

4. The project must demonstrate the 
potential for affecting a much wider 
audience than the immediate project 
participants. (10 points) 

5. The project represents an 
improvement upon existing teaching 
methods. (5 points) 

6. Applicants have the capacity to 
carry out the project as evidenced by: 

a. Academic and administrative 
qualifications of the project personnel; 

b. Quality of project design; 

c. Soundness of project management 
plan. (10 points) 

The decision to award grant funding is 
solely within the discretion of the 
Commission based upon its judgment of 
how best to fulfill the statutory purposes 
to the grant program. 

Applicable regulations: 45 CFR 2010 
as published in the August 14,1987 
Federal Register (52 FR 30582). The 
Commission’s program announcement 
was also published together with the 
grant regulation. 

Interested applicants are invited to 
call or write to the Commission for a 
copy of the printed version of the 
program announcement and application 
forms. 

Authority: Title V of Pub. L. 99-194: 45 CFR 
part 2010. 

Herbert M. Atherton, 

Deputy Staff Director and Director of 
Education. 

[FR Doc. 90-20648 Filed 8-31-90: 8:45 ami 
BILLING CODE 634O-01-N 


COMMODITY FUTURES TRADING 
COMMISSION 

Authorization of the National Futures 
Association to Implement Phases II 
and 111 of a Pilot Program for the Direct 
Electronic Entry of Registration Data 
With Respect to Applicants for 
Registration as Associated Persons of 
Specified Registrants 

agency: Commodity Futures Trading 
Commission. 

action: Notice and Order authorizing 
the National Futures Assocaition (NFA) 
to implement certain phases of a pilot 


program that would allow specified 
registrants to enter registration data 
electronically into the NFA computer 
system with respect to the associated 
person (AP) applicants and APs of those 
registrants and allow NFA to grant 
temporary AP licenses on the basis of 
such electronic filings. 

summary: Section 8a(l) of the 
Commodity Exchange Act (Act) 
provides, in part, that the Commodity 
Futures Trading Commission 
(Commission) “may grant a temporary 
license to any applicant for registration 
with the Commission pursuant to such 
rules, regulations, or orders as the 
Commission may adopt * * * V* 7 U.S.C. 
12a(l) (1988). The Commission is 
authorizing NFA to implement Phases II 
and III of a pilot program designed to 
expedite the temporary licensing 
process. Under the expanded pilot 
program, specified registrant sponsors 
would electronically enter into NFA’s 
registration computer system all of the 
information required to be filed on Form 
8~R (application for registration), Form 
3-R (supplemental statement to 
application for registration). Form 8-T 
(notice of termination) or Form U-5 
(uniform termination notice for 
securities industry registration) for all 
AP applicants. APs and branch office 
managers 1 of such sponsors and of any 
introducing brokers guranteed by the 
sponsors and for whom the sponsors 
have assumed registration 
responsibilities. The pilot program is 
intended to demonstrate the utility of 
permitting registrants to enter 
registration data concerning their 
sponsored AP applicants and APs 
directly into the NFA computer system 
via computer terminals in those 
registrants’ offices and to initiate the 
processing of such data by the NFA 
computer for the purpose of granting 
temporary licenses. 2 

The pilot program procedures are 
designed to expedite the temporary 
licensing process by allowing direct 
input of data and thereby permit 
applicants to act as APs sooner than if 
their applications were mailed or 
delivered to NFA and the data entered 
into the NFA computer by NFA 
personnel. The direct entry program thus 
is fully consistent with the primary 
purpose of the temporary license 


1 Brunch office managers are APs but also are 
required to disclose their stutus as branch office 
managers on Forms S-R. 3-R and S-T. 

* A temporary AP license allows an eligible 
applicant for registration to work for his sponsoring 
firm without waiting until a full f tness check is 
completed. The applicant may not be granted AP 
registration until the fitness check is complete. 











35326 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


procedure—to enable apparently 
qualified applicants to begin work as 
soon as possible prior to completion of a 
full fitness check. 3 The program will 
also permit speedier updates of 
registration information and 
terminations with respect to APs of 
participating firms during Phase III, and 
may improve registration processing 
productivity overall by relieving some of 
NFA’s current data entry burden. 

The direct entry procedure also is 
expected to reduce or eliminate 
registration processing delays due to 
data omissions because the direct entry 
procedures use a computer screen that 
will disclose any such omissions 
immediately to the sponsor and permit 
immediate correction of data. Final 
registration determinations will continue 
to require the submission of Form 8-R, 
fingerprint cards and signed sponsor 
certifications, and they will also require 
full fitness determinations. At the 
completion of the pilot program, NFA 
will request Commission review of the 
program and, if appropriate, request a 
further Commission order approving 
extension of the program to other 
registrant sponsors of APs. The 
Commission contemplates that it would 
consider amendments to Commission 
and NFA registration rules to make 
direct entry generally available only 
after a full evaluation of the operation 
and results of the pilot program. 

SUPPLEMENTARY INFORMATION: 

I. Background 

A. The Direct Entry Program 

NFA has noted that the entry of data 
into its computer system is a labor 
intensive operation which processes 
approximately 15,000 applications 
annually. 4 * To expedite the registration 
processing for individual AP applicants, 
NFA has proposed a program that, in its 
later phases, would allow the direct 
entry of individual registration data into 
NFA’s registration computer system by 
the sponsors of APs and the automatic 
electronic granting of temporary licenses 
for APs following such direct entry of 
registration data. Sponsors would, 
however, continue to file with NFA the 
required paper registration forms, 
fingerprint cards and sponsor 
certifications, which would be matched 
against directly entered data that is 
material to the granting of a temporary 
license and used to complete the fitness 


a 49 FR 8208. 8210 (March 5.1984). 

4 Petition for an Order Granting National Futures 

Association Permission to Conduct a Pilot Program 

for the Direct Entry of Registration Data by a 

Sponsoring Registrant, Submitted by National 

Futures Association, January 5.1989 (Petition), p. 2. 


processing for final registration 
determinations. 

NFA’s pilot program for the direct 
entry of registration data consists of 
three phases. Phase I of the pilot 
program began on November 10,1987 
when, with the concurrence of the 
Commission's Division of Trading and 
Markets (Division), two futures 
commission merchants (participating 
firms) 6 were provided with direct 
inquiry access via computer terminals at 
the firms to NFA’s computer registration 
database [Le., the Membership 
Registration Receivables System or 
MRRS) for all registration information to 
which they are entitled under NFA 
registration rules 701 (b) and (c). e The 
Division subsequently permitted nine 
additional participating firms in Phase I 
of the pilot program. 7 Such inquiry 
access by the participating firms not 
only familiarized the firms with MRRS 
inquiry procedures but also freed NFA 
personnel from otherwise directly 
handling the firms’ inquiries. 

NFA now seeks Commission 
authorization to implement Phases II 
and III of the pilot program, which will 
allow the participating firms to enter AP 
registration data into the NFA computer 
system and receive temporary license 
determinations immediately following 
entry and computer processing of the 
data. Assuming that the experience 
gained during the pilot program 
demonstrates the effectiveness and 
integrity of the direct entry procedures, 
NFA will petition the Commission to 
make the program generally available to 
registrant sponsors of APs on a 
permanent basis. 8 


These two firms were Merrill, Lynch, Pierce, 
Fenner & Smith, Inc. and Stotler and Company. See 
Division letter dated November 10,1987 to Daniel J. 
Roth at NFA. 

• Such information generally consists of public 
information regarding all registrants and all 
registration information relating to a firm’s own 
employees and prospective employees. 

1 These firms are Shearson Lehman Brothers, Inc. 
(see Division letter dated December 23.1987 to 
Daniel J. Roth at NFA); Dean Witter Reynolds, Inc., 
Geldermann, Inc., R.J. O’Brien, Inc. and Prudential 
Bache Securities, Inc. (see Division letter dated 
January 8.1990 to Daniel J. Roth at NFA); Coldinan 
Sachs 8 Co. and Cargill Investor Services, Inc. (see 
letter dated March 19.1990 from Daniel J. Roth at 
NFA to Division); and BT Futures Corp. and Brokers 
Resource Corp. ( see letter dated June 15.1990 from 
Daniel J. Roth at NFA to Division). 

* It is anticipated that new participating firms 
would undergo a six-month probationary period 
during which the review and processing procedures 
would be the same as those described for Phase II 
and 111 of the pilot program. NFA contemplates that 
it will compare each Form 8-R when it is received 
and the corresponding electronic filing only for each 
item directly material to temporary license 
eligibility (i.e., the applicant’s name and signature, 
the sponsor’s certification, receipt of fingerprint 
card and all questions relating to disciplinary 
history). Final registration determinations would 


D. Delegation of Registration Functions 

The NFA has been authorized by the 
Commission to process applications for 
registration, conduct fitness checks and, 
where appropriate, grant registrations 
under Commission oversight. See 
sections 8a(10) and 17(o) of the Act (7 
U.S.C. 2a(10) and 21(o) (1988)). The 
registration functions which NFA is 
authorized to perform generally fall into 
two categories—registration processing 
and fitness assessment. Registration 
processing consists of receipt and 
handling of applications, data entry, 
handling of fees, and other 
administrative aspects of registration. 
Fitness assessment consists of the 
review of applications to determine 
whether registration is consistent with 
the Act and Commission regulations, 
which establish disqualifications from 
registration based upon statutorily 
specified factors such as certain 
criminal convictions and civil 
sanctions.® 

The Commission has authorized NFA 
to process and, where appropriate, grant 
applications for registration under the 
CEA for futures commission merchants 
(FCMs), introducing brokers (IBs), 
commodity pool operators (CPOs), 
commodity trading advisors (CTAs), 
leverage transaction merchants (LTMs), 
the APs of such registrants, and floor 
brokers; to process and, where 
appropriate, grant applications for 
temporary licenses for all categories of 
APs; and to deny, condition, suspend, 
restrict or revoke the registrations of all 
registrant categories other than floor 
brokers. 10 


continue to be made by NFA after review of the 
results of fitness inquiries, including the FBI 
fingerprint reports and the SEC check. 

• The circumstances which give rise to statutory 
disqualifications from registration are set forth in 
sections 8a(2) and 8a(3) of the Act (7 U.S.C. 12a{2) 
and 12a{3) (1988)). The more serious grounds for 
statutory disqualification from registration are set 
forth in section 8a(2), including, among others, any 
prior revocation of registration or a refusal of 
registration within the preceding five years, 
injunctions relating to futures or securities 
activities, and felony convictions within the 
preceding ten years for offenses related to futures or 
securities transactions or embezzlement, theft, fraud 
and similar types of wrongdoing. Grounds for 
statutory disqualification under section 8a(3) of the 
Act include certain misdemeanor convictions, 
certain felony convictions which are more than ten 
years old, or a plea of nolo contendere to criminal 
charges of felonious conduct. 

10 48 FR 15940 (April 13.1983) (authorizing NFA 
to receive and process new applications for 
registration as an IB or an AP of an IB); 48 FR 35158 
(August 3.1983) (authorizing NFA to grant 
registration for IBs and their APs): 49 FR 8228 
(March 5,1984) (authorizing NFA to process and 
issue temporary licenses to applicants for 
registration as APs of IBs): 49 FR 39593 (October 9. 
1984) (authorizing NFA to process and grant 

Continued 


















Federal Register / VoL 55. No. 171 / Tuesday, September 4. 1930 / Notices 


35927 


C. Registration Processing and Fitness 
Assessments 

In summary, the steps taken to 
process a registration application and 
evaluate the applicants Fitness are the 
following. A firm seeking to register an 
AP must sponsor the applicant, who 
applies through the Firm for a temporary 
license as an AP. 11 Sponsorship 
requires the sponsoring Firm to verify the 
employment and educational history of 
the applicant for registration for the 
preceding three years. A sponsoring Firm 
sends an applicant's Form 8-R. ia 
registration fee, 13 fingerprint card and 
sponsor's certification to NFA. When 
the NFA Registration Unit receives the 
application, it enters the data on the 
application form into MRRS, NFA’s 
computer registration database. 

The MRRS system automatically 
prints a temporary AP license or AP 
registration when all required conditions 
are met the application materials 
are complete and there are no fitness- 
related problems on the face of the 
application or in the system. Before 
issuing a temporary license. MRRS First 
scans the application data to determine 


applications for registration of FCMs, CPOs, CTAs 
and their APs and to issue temporary licenses to 
eligible APS): 50 FR 34885 (August 2S. 19851 
(authorizing NFA to deny, condition, suspend, 
restrict or revoke the registration of any person 
applying for registration or registered as an FCM. 

IB. CPO. CTA, or an AP of such entities); St FR 
25929 (July 17.1988) and 51 FR 34490 (September 29. 
1986 (authorizing NFA to process and grant 
applications for registration as a floor broker); 51 FR 
45749 (December 22.1968) (authorizing NFA to grant 
temporary licenses for guaranteed IBsh 53 FR 8428 
(March 15.1988) (authorizing NFA to process 
withdrawals from registration): 54 FR 19594 (May 8. 
1989} (authorizing NFA to process and grant 
applications for registration as an LTM or AP of an 
LTM and to grant temporary' licenses to APs of 
LTMs): and 54 FR 41133 (October 5.1989) 
(authorizing NFA to take adverse actions against 
LTM9 and their APs. as well as against applicants 
for registration in either category ). 

11 AP sponsors must be registered in the 
appropriate capacity and must employ the 
sponsored individual. Temporary licenses may be 
issued to qualified persons at the time of initial 
employment in the industry- as an AP and in the 
event of subsequent transfer to and employment by 
another sponsoring firm. Temporary licenses may 
also be issued to a guaranteed IBM which has 
entered into a guarantee agreement with a FCM 
prior to clearance of the IB’s registration. 
Commission Rules 3.40 and 3.41.17 CFR 3.40 and 
3.41 (1989). The only firms eligible to receive 
temporary licenses are guaranteed IBs. 

'• Form 8-R requires an applicant to disclose 
personal information (including name and address 
and. on a voluntary basis, date and place of birth 
and social security number), employment and 
residential history for the preceding ten years, 
educational history and disciplinary history. The 
applicant and the sponsor must certify the 
application, and the sponsor must verify the 
applicant's employment and educational histoiy for 
the preceding three years. 

13 Some firms have funds on deposit with NFA 
against which fees are deducted as applications are 
rereived by NFA. 


the completeness of the application and 
whether the applicant is eligible for a 
temporary license. A "clean" application 
that does not implicate any of the Five 
following disqualifying factors will 
result in issuance of a temporary 
license, allowing a salesperson to work 
as an AP prior to completion of the 
Federal Bureau of Investigation (FBI) 
and Securities and Exchange 
Commission (SEC) checks. Factors that 
will prevent issuance of a temporary 
license to an AP are: (1) An incomplete 
application; (2) a "YES" answer to any 
of the disciplinary history questions on 
the application (questions 14 through 
18). often referred to as self-declared 
derogatory information (SDD1); 14 (3) a 
conditional, suspended or revoked 
registration; (4) a "hold" in the system 
indicated by the message. 
"INVESTIGATION IN PROCESS;" of (5) 
failure to provide proof of successful 
completion of the National Commodity 
Futures Examination. If none of the 
above factors exist, a temporary license 
is issued to the applicant. In addition to 
the above five factors which prevent 
issuance of a temporary license, other 
factors will prevent MRRS from 
converting a temporary AP license to an 
AP registration. These could include the 
pendency of an FBI fingerprint check or 
SEC name check or the detection of 
derogatory information through the FBI 
Fingerprint check or SEC name check. 

If the application reflects SDDI, the 
applicant has a conditional, suspended, 
or revoked registration, there is a 
registration hold on the applicant s 
registration, or the FBI or SEC checks 
disclose relevant derogatory 
information, NFA registration staff 
conducts further investigations and 
reviews of the application. Proceedings 
to deny or condition registration are 
initiated by a letter from the NFA 
Director of Compliance, or the Director’s 
designee, which provides the applicant 


14 Registration application Form 8-R for 
individuals (and Form 7-R for firms) contains 
questions that require information to be disclosed 
about an applicant’s or registrant’s past bistory that 
would generally be a basis for disqualification from 
registration under Sections 8a(2) or 8a(3) of the Act. 
In the case of an individual who is currently 
registered as an AP or who has terminated his 
registration as an AP within the preceding sixty 
days, a "YES" answer that relates to a matter than 
already has been disclosed in connection with a 
previous application for registration, if such 
registration was granted, or that was disclosed 
more than thirty days previously in an amendment 
to such application, will not prevent issuance of a 
temporary license. (Commission Rules 3.12(dXll(vi). 
3J6(d)(l)(vi), and 3.16(dKlHvi) (17 CFR 
3.12(dUl)(vi). 3,18(d)91)(vi). and 3.18(dKlUvi)) (1909). 
A firm applying for a temporary license as an IB 
which has a “YES'' answer to a disciplinary history 
question on Form 7-R is also barred from receiving 
a temporary IB registration. 


an opportunity to withdraw the 
registration application or to request 
further consideration. 

II. Phases II and III of the Pilot Program 

A. Phase U 

Phase II of the pilot program is 
intended to familiarize the participating 
firms with the procedures for the direct 
entry of registration data into NFA’s 
registration computer system and to 
provide NFA an opportunity to monitor 
the accuracy of data entered into MRRS 
by participating firms. NFA believes that 
given the limited nature and purpose of 
Phase U. that portion of the program 
should not be lengthy. However, NFA 
has represented that Phase II will last at 
least ninety (90) days and that 
participating firms 15 will not be 
allowed to engage in Phase III until 
Commission staff has been given an 
opportunity to review Phase II 
performance and to interpose any 
objection to progression to Phase IIL 

During Phase II, the participating firms 
will enter the data contained on those 
submitted forms directly into NFA’s 
computer system through terminals 
located in their offices. The participating 
firms would continue to file Forms 8-R, 
3-R, or 8-T relating to their APs or AP 
applicants and NFA would process the 
applications as previously described. 

Direct data entry by participating 
firms w f ould be accomplished by the 
firm following instructions provided by 
MRRS on the computer terminal screen 
which request the entry of information 
corresponding to the information 
requested on the relevant registration 
form. The MRRS program determines if 
the applicant already has an NFA 
identification number (and if not, will 
assign one), advises the firm of any 
omissions in data entry, allows the firm 
to correct such omissions and 
determines if the proposed registration 
would result in a prohibited multiple 
affiliation. 1 ® 


l% See letter dated July 17.1990 from Daniel J. 

Roth at NFA to Division. Those firms will be the 
same firms which participated in Phase I of the pilot 
program, except for StotJer and Company. 
Additjprud firms wiU be added only with the 
approval of the Division of Trading and Markets. 

*• See Petition at Exhibit A. The participating firm 
checks the MRRS system to determine if the 
applicant already has an NFA ID number by using 
the applicant's social security number. If the 
applicant’s social security number is not in the 
MRRS system, an additional check using the 
applicant’s name is made to determine if that name 
is located in the MRRS system but not identified by 
social security number. This further step must be 
performed before an ID number la assigned to 
assure that all holds in the MRRS system are 
reviewed carefully, including holds with respect to 
individuals whose social security numbers are 
unknown. 












35928 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


Upon completion of data entry by a 
participating firm, and after receipt of 
the corresponding registration form filed 
by such firm, NFA personnel will 
compare all of the information 
contained in the form with the data 
entered directly into MRRS by the firm. 
NFA personnel will make any necessary 
corrections and then direct MRRS to 
process the application. It should be 
noted that during Phase II only NFA 
personnel will be authorized to instruct 
MRRS to process an application and, if 
appropriate, grant a temporary 
license. 17 No temporary license will be 
issued in Phase II until the required 
paper forms are received and reviewed 
by NFA. Where appropriate, MRRS will 
transmit notice to the participating firm 
via a computer terminal that a 
temporary license has been granted. 18 If 
the application is deficient, if the 
applicant does not qualify for a 
temporary license, or if the applicant 
does not appear to qualify for 
registration, the application will be 
given a pending status. Otherwise, the 
application for final registration will be 
processed by NFA personnel as 
previously described. 

NFA has represented that it will 
provide the Commission with statistics 
regarding the accuracy of data enty and 
the timeliness and completeness of 
required Form 8-R, 3-R or 8-T filings. 
Implementation of Phase III of the pilot 
program will not occur until Commission 
staff have had an opportunity to review 
these statistics and to raise any 
concerns or objections deemed 
appropriate based upon the Phase II 
data and other experience. 

B. Phase III 

During Phase III, which will last a 
minimum of six months, participating 
firms will continue to enter AP 
registration data directly into MRRS and 
to file the appropriate 8-R, 3-R, and 8-T 
forms with NFA. NFA also will continue 
to compare all of the information 
contained on the submitted registration 
form with the corresponding data 
entered directly by the firm in MRRS. 19 


lT See Petition at Exhibit A. n. 1, p. 3. 

18 The system will generate a letter to the 
sponsoring firm advising it of the registration status 
that has been granted. A participating firm may 
elect to have all approval and deficiency letters 
transmitted directly to a printer in its offices. In any 
event, the system will generate a file copy and a 
microfiche copy of NFA to be maintained by NFA. 
See Petilion at Exhibit A. p. 3 and p. 5. 

19 The results of these comparisons will be 
included in a statistical report which NFA will 
provide to the Commission on a monthly basis. 


However, unlike in Phase II, in Phase III 
participating firms will be permitted to 
enter a command via computer terminal 
instructing the MRRS computer to issue 
a temporary license prior to NFA's 
receipt of the required Form 8-R when 
the data directly entered into MRRS by 
the participating firm indicate that the 
AP applicant is eligible for a temporary 
license. 20 Specifically, a temporary 
license would be granted whenever the 
data entered directly by the applicant’s 
sponsor indicate that: (1) The 
application form is complete, has been 
signed by both the applicant and his 
sponsor and has been mailed or will be 
mailed to NFA the same day [i.e,, the 
day on which the firm directs MRRS to 
process the application); (2) the 
applicant’s sponsor has certified that the 
application form mailed to NFA is 
accompanied by a legible fingerprint 
card or an alternative acceptable under 
NFA registration rules 21 and by 
evidence that NFA proficiency 
requirements have been met; 22 (3) the 
information filed electronically by the 
firm indicates that there are no “YES” 
answers to any of the disciplinary 
history questions; and (4) there is no 
registration hold on that applicant. 

Thus, in Phase III, temporary licenses 
could be granted by MRRS upon entry of 
a command by the participating firm to 
process the application in reliance upon 
the data entered by the participating 


80 Commission Rule 3.40,17 CFR 3.40 (1980) 
provides that a temporary license may be issued 
upon the contemporaneous filing with the NFA of: 

(a) A Form 8-R, properly completed in accordance 
with the instructions thereto, the Disciplinary 
History portion of which contains no "Yes 0 answers 
indicating that the applicant may be subject to a 
statutory disqualification under sections 8a(2) 
through 8a(4) of the Act: 

(b) The fingerprints of the applicant on a 
fingerprint card provided by the National Futures 
Association for that purpose: and 

(c) The sponsor's certification required by 
9 3.12(c), § 3.16(c). or 9 3.18(c) as appropriate. 

81 NFA Registration Rule 209(a) accepts as a 
substitute the submission of a photocopy of a 
fingerprint card which has been submitted to the 
FBI if the processing and identification has been 
completed satisfactorily by the FBI not more than 
ninety days prior to the filing of such photocopy 
with NFA. Alternatively. NFA Rule 209(a) deems 
the fingerprint filing requirements met if the 
applicant has been registered with NFA in any other 
capacity within the preceding ninety days. 

88 NFA Bylaw 401(b) provides that no person may 
be associated with an NFA member [i.e., as an AP) 
unless the person is registered with NFA as an 
associate. NFA Registration Rule 401 requires as a 
condition for associate registration evidence that 
the applicant has taken and passed the National 
Commodity Futures Examination no more than two 
years prior to the date the application is received by 
NFA, has been duly registered in another capacity 
within that two-year period, or is registered with the 
National Association of Securities Dealers as a 
general securities representative and the applicant's 
activities will be limited to the solicitation of funds 
for commodity pools or referring clients to an AP 
who has satisfied the proficiency requirements. 


firm and before NFA has received the 
firm’s written Form 8-R submission. 

Such automatic processing and issuing 
of temporary licenses would be 
consistent with current procedures, 
which permit the issuance of a 
temporary license on the basis of no 
self-declared derogatory information or 
registration hold, and permit an 
applicant to begin work as an AP more 
quickly than under current procedures. 
Updates (Form 3-R) and terminations 
(Form 8-T) will also be processed more 
quickly during Phase III, subject to NFA 
review and monitoring. 

If the applicant’s Form 8-R, fingerprint 
card of proof or successful completion of 
the proficiency examination have not 
been received by NFA within five 
business days of the date the original 
application information was processed 
by MRRS, NFA will terminate the 
temporary license immediately and 
notify the applicant and sponsoring 
firm. 23 Moreover, once the Form 8-R has 
been received by NFA. all information 
on the Form 8-R will be compared to the 
information that the firm previously 
entered into MRRS. If such comparison 
discloses different information from that 
entered directly by the sponsoring firm 
that indicates that the applicant is not 
eligible for a temporary license, for 
example, derogatory information 
indicating a statutory disqualification, 
NFA will terminate the temporary 
license. As under current procedures 
discussed earlier, subsequent adverse 
FBI fitness reports or SEC checks 
revealing disqualifications not 
previously disclosed will also result in 
termination of the temporary license 
upon five days notice. 

C. Requirements of Participating Firms 

The obligations of participating firms 
will be established by written 
agreement. 24 Among other things, the 
draft agreement requires that 
participating firms (1) enter in NFA’s 
MRRS all information required to be 
filed on Forms 8-R, 3-R and 8-T for all 
APs of the participating firm and of the 
participating firm’s guaranteed 
introducing brokers for whom the 
participating firm has assumed 
registration responsibilities; (2) mail by 
first class mail or hand deliver to NFA 
on the day that the firm enters a 


88 NFA represents that MRRS has been 
programmed to monitor for late filings. NFA also 
states that notice of termination will be provided to 
the sponsor by telephone whenever possible and 
also by written notice through overnight mail. 

84 Agreement For Firm Direct Entry Privileges to 
the Membership Registration Receivables System of 
the National Futures Association (Agreement). 
Exhibit B to Petition. 














Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35929 


command in MRRS to process an 
application, the corresponding 
registration form with all required 
attachments; 25 (3) adopt and enforce 
procedures to ensure the integrity and 
confidentiality of all individual filings; 
and (4) make its data entry personnel 
available for testimony in court, before 
the Commission, NFA or any contract 
market, in regard to the authenticity, 
integrity or accuracy of any paper or 
electronic Filing covered by the 
agreement. 

The agreement also requires the 
participating firm to make the following 
"special” certifications as part of its 
electronic filing (which reflect the 
requirements of Commission Rule 
3.12(c)(l)(iMiv)): 

—the applicant or registrant has signed the 
Form 8-R; 

—the sponsor has signed the sponsor's 
certification section of the Form 8-R or 3-R, 
or the former sponsor has signed the Form 
8—T (or U—5); 

—the Form 8-R is accompanied by a legible 
Fingerprint card (or alternative acceptable 
under NFA registration rules or 
Commission regulations); and 
—the Form 8-R is accompanied by proof of 
successful completion of the proficiency 
requirements. 

The agreement further provides that 
the entry of an instruction by the 
participating firm to NFA to process an 
electronic filing constitutes a 
certiFication by such firm that the 
electronic filing accurately reflects the 
information on the paper filing. The 
participating Firm also acknowledges 
that the willful submission of a false 
special certification constitutes cause 
for denial, suspension or revocation of 
the firm’s registration under sections 
8a(2) and 8a(3) of the Act. 26 

The agreement makes clear that NFA 
is not required to grant temporary 
licenses on the basis of an electronic 
filing but may do so where a submission 
is complete ;.e. f satisfies the standards 
set forth in Commission Rule 3.40 for 
issuance of temporary licenses. 
Temporary licenses granted to 
applicants on the basis of electronic 
filings will terminate under the 
circumstances provided in Commission 


ls The date for processing may differ from the 
date of initial data entry. This could occur if the 
MRRS screen notes the need for further information 
which the firm elects to enter at a later date. 

*• Section 6(b) of the Act (7 U.S.C. 9 (I960)) also 
makes it unlawful for any person to willfully make 
any false or misleading statement of a material fact 
in any registration application or to willfully omit to 
state in any such application any material fact 
which is required to be stated therein. Violators are 
subject to a civil penalty of not more than $100,000 
for each violation, suspension (not to exceed six 
months) or revocation of registration and trading 
prohibitions. 


Rule 3.42. 27 In addition, the agreement 
provides that temporary licenses 
granted on the basis of an electronic 
filing shall terminate immediately upon 
notice to the participating Firm that the 
paper filing was not received by NFA 
within Five business days after the 
electronic filing or that the paper Filing 
contains information different from the 
information in the electronic Filing that 
indicates that the applicant does not 
qualify for a termporary license. Such 
notice may be given orally by telephone, 
by electronic transmission to a terminal 
on the participating firm’s premises, by 
United States mail, by hand delivery, or 
by any other standard means of 
conveyance (including a generally 
recognized ovemght delivery service). 

D. Statistical Information 

In order to provide an objective basis 
for evaluation of the pilot program, NFA 
has undertaken to provide the 
Commission on a monthly basis with 
certain statistics classified by the type 
of filing. For each Form 8-R filing, 28 
NFA will maintain data on the number 
of electronic and paper filings resulting 
in the issuance of temporary licenses, 
the number of applications given a 
"pending” status due to the 
incompleteness of the application, and 
the number of applications given a 
"pending” status because they do not 
satisfy the standards for issuance of a 
temporary license. 29 

Comparative statistics also will be 
maintained with respect to the time 
required to grant temporary licenses to 
APs of participating firms and to APs of 
nonparticipating firms. For each type of 
Form 8-R Filing, NFA will compile 
statistics on the average time before the 
temporary license is granted and, during 
Phase III, on the number of temporary 
licenses that are terminated by NFA. 30 


97 Rule 3.42 provides that a temporary license 
shall terminate five days after service upon the 
applicant of a notice by the Commission pursuant to 
Rules 3.52 or 3.00 that the applicant may be found 
subject to a statutory disqualification from 
registration, or immediately upon termination of the 
association of the applicant with the applicant's 
sponsor or immediately upon the withdrawal of the 
registration pursuant to Rule 3.40(d) (failure to 
provide requested information). 

*• The statistics will reflect filings from new 
applicants for AP registration as well as from 
existing APs transferring to a new sponsoring firm 
pursuant to special temporary licensing procedures 
set forth in Commission Rule 3.12(d), 17 CFR 3.12(d) 
(1989). 

** See discussion in part I.C (Registration 
Processing and Fitness Assessments) concerning 
factors preventing the issuance of a temporary 
license. 

90 These statistics will include terminations of 
any temporary licenses granted during Phase li 
based on adverse fitness information received 
during Phase 111. 


Phase III statistics concerning temporary 
license terminations for participating 
firms will be divided into three 
categories: terminations based on failure 
to receive the necessary follow-up 
filings within Five business days, 
terminations based on discrepanices 
between the electronic filing and the 
paper filing that are material to 
determinations concerning issuance of 
temporary licenses, and terminations 
based on information uncovered by the 
Fitness check that was not reported on 
the paper filing. 

The following additional statistics will 
be maintained for electronic Filings to 
facilitate evaluation of data entry 
reliability: 

(1) The average time between the electronic 
filing and NFA’s receipt of the complete 
paper riling; 

(2) The number and type of material 
discrepancies between the electronic filing 
and paper filings; and 

(3) The number of filings containing non¬ 
material discrepancies between the 
electronic and paper filings. 

Finally, NFA will prepare Firm-by-firm 
statistics relating to data reliability and 
to temporary license terminations due to 
late paper filings or material 
discrepancies between the electronic 
and paper Filings. 

III. Discussion 

The direct entry program essentially 
would permit substitution on a 
temporary basis 31 of electronically 
transmitted registration data for paper 
filings of such data and transfer the 
burden of clerical entry of such data into 
the MRRS computer system from NFA to 
the sponsoring firm. Under both the 
direct entry program and the current 
processing system, such registration 
data would be supplied by the applicant 
and reviewed and submitted by the 
applicant’s sponsoring firm. The 
sponsoring firm is required to certify the 
accuracy and completeness of all such 
information. As under current 
procedures, the direct entry program 
would allow the automatic processing 
and granting of temporary licenses 
based upon the registration information 
and certiFications provided by the 
sponsoring firm prior to completion of a 
full fitness check. Thus, the electronic 
transmission of data and the initiation 
of MRRS computer processing for 
temporary license applications by the 
sponsoring firm would change the 
process by which data are conveyed to 
NFA but not the content of the data on 
which temporary licenses are granted. 


91 All direct entry electronic filings will be 
followed by the necessary paper filings. 











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Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


Ail determinations concerning an 
applicant’s final registration status will 
continue to be made by NFA personnel 
after review of FBI fingerprint reports 
and other fitness checks. Nonetheless, in 
order to assure that the direct entry 
program will not compromise the 
integrity of the Commission's 
registration program and records. 
Commission staff have reviewed a 
number of specific issues concerning the 
potential impact of the proposed pilot 
program upon fitness screening and the 
registration process. 

A Thoroughness of Fitness Screening 

Currently, applicants and their 
sponsors generate the application 
information used by NFA to make 
registration determinations. Under the 
direct entry program, applicants and 
their sponsors will continue to supply 
the information required by the 
registration forms and will continue to 
file applicant fingerprint cards. Final 
registration determinations will continue 
to be based upon NFA's analysis of the 
information generated by the applicant 
and sponsor, results of fingerprint 
checks and other fitness checks. 

Although temporary licenses will be 
granted automatically following the 
entry of a command by the sponsor 
through its computer terminal for MRRS 
to process the application on the basis 
of information filed electronically, the 
procedure does not differ substantively 
from current practice in which 
temporary licenses are granted on the 
basis of self-declared information and 
review of the registration hold file for 
any disqualifying matter. The computer 
program used to process the temporary 
licenses will employ the some screening 
questions currently used by NFA in 
determining whether to issue temporary 
licenses. The fact that fingerprint cards 
will be received by NFA after a 
temporary license has been issued does 
not represent a material change from 
current procedures, which provide for 
the granting of a temporary license prior 
to completion of the full fitness check. 
The temporary licensing procedure was 
intended to allow persons whose filings 
indicated that they were not subject to 
statutory disqualifications under 
Sections 8a(2) or 8a(3) of the Act to 
begin temporary employment pending 
completion of the full fitness check. 82 
Thus, the direct entry program will not 
change the standards governing the 
granting of temporary licenses or the 
scope of the data upon which such 
licenses are granted. 


** See H.R. Rep. No. SOS (Par! 1). 07th Cong.. 2d 
Boss. 50 (1082). 


B. Integrity of the Commission's 
Registration Records 

By previous orders the Commission 
has delegated to NFA the responsibility 
to act as the official custodian of the 
Commission’s registration records for 
futures commission merchants, 
introducing brokers, commodity pool 
operators, commodity trading advisors, 
leverage transaction merchants, the 
associated persons of the foregoing, and 
floor brokers. 88 In those orders, NFA 
was also delegated the responsibility to 
certify as to the maintenance, 
authenticity and completeness of those 
registration records. NFA undertook to 
provide all such certifications, affidavits 
and testimony necessary to authenticate 
the records and the information 
contained therein. 84 Rules and 
procedures for preparing registration 
record certifications were adopted by 
NFA and approved by the Commission 
on November 15,1984, and November 
29,1984, respectively. 

Under the direct entry program, both 
the data directly entered into MRRS by 
the participating firm and the 
subsequently filed Form 8-R, 3-R, or 8-T 
will constitute registration records 
maintained on behalf of the Commission 
by NFA. 38 However, the filed 
registration forms, which will have been 
received and reviewed by NFA 36 , will 
constitute the registration record to be 
relied upon in any criminal, civil or 
administrative proceeding, and NFA will 
continue to certify as to the authenticity 
of those records. 87 The Commission’s 


•* 49 FR 39593 (October 9. 1984); 54 FR 19594 
{May 8,1989). 

»«/</. 

•• Commission Rule 145.0(b). 17 C.F.R. 145.0(b) 
(1989) defines "records’* for purposes of the 
Commission’s recordkeeping responsibilities as 
including “any document, writing, photograph, 
sound or magnetic recording, videotape, microfiche, 
drawing or computer-stored information or output in 
the possession of the Commission." The 
Commission previously has stated that “registration 
records maintained on behalf of the Commission by 
NFA will Include documents filed with NFA by any 
applicant pursuant to registration requirements in 
the Act. the Commission's regulations or those NFA 
registration rules that implement such requirements 
or regulations (and any computer record generated 
by such documents) as well as hardcopy (paper) 
and computer records maintained by the 
Commission as of the date of transfer |io NFA}.“ 49 
FR 39593. 39595 n. 13 (October 9,1981). The 
Commission further notes that data directly entered 
by firms into MRRS can be printed out in hard copy 
form. 

•• If the required Form 8-R, 3-R or 8-T is not 
received by NFA. the MRRS registration computer 
will detect such deficiency and alert NFA staff with 
a report so that the staff may terminate any granted 
temporary license. 

87 In the brief interval between recelptof the 
electronic filing and receipt of the hard copy, the 
computer record would be the record of the filing. 
NFA would certfiy the accuracy of a computer 
printout reflecting the electronic filing. (Soe Federal 
Rules of Evidence 803(a), 901. and 1001(3).) 


approval of Phases II and III of the 
direct entry program does not eliminate 
the requirements in Commission Rule 
3.12(c) and NFA registration Rule 206(a) 
that an AP applicant file a Form 8-R 
(neither rule is being amended). 3 * 
Moreover, approval of the direct entry 
program does not alter the fact that 
registration determinations will continue 
to be made by reference to the 
information contained in the submitted 
Forms 8-R. Both Commission Rule 3.12 
and NFA registration Rule 206 require 
an application for registration as an AP 
of an FCM to be made by means of Form 
8-R. 39 The direct entry program requires 
the participating firm to electronically 
enter into MRRS all of the information 
required on Form 8-R (or other relevant 
registration forms) and to follow up each 
electronic filing by mailing or hand 
delivering the paper form to NFA on the 
same day. 40 Accordingly, the filed paper 
forms will continue to constitute the 
primary registration record for all 
administrative and judicial purposes. 41 

Although under the direct entry 
program temporary licensing 
determinations will be made in reliance 
upon data directly entered into MRRS 
by a sponsoring firm prior to NFA’s 
receipt of the Form 8-R, any differences 
between the directly entered data and 
the subsequently Filed registration form 
would be resolved by reference to the 
submitted form 42 and any differences 
that indicate that the applicant does not 
qualify for a temporary license will, by 
agreement, result in the automatic 
termination of a temporary license upon 
notice to the participating firm. 43 


See Commission Rule 3.12(c). 17 CFR 3.12(c) 
(1989) and NFA Registration Role 20T»(.i). 

"Id. 

40 See Agreement at f$S-4 (Exhibit B to Petition). 

41 In one of its orders delegating registration 
responsibilities to NFA, tire Commission has 
recognized the primacy of Hied registration forms by 
stating that “any document that an applicant Hies 
with NFA pursuant to registration requirements in 
(he Act. the Commission's regulations or those NFA 
Registration Rules that implement such 
requirements or regulations shall be deemed filed 
with the Commission thereof, for all purposes." 49 
FR 9593. 39595 (October 9,1984). The Commission 
notes that NFA has not requested the elimination of 
paper filings of registration forms. The Commission 
also wishes to note, however, that as technology 
advances and the law develops In this area, it may 
be possible to consider such a step provided there 
are adequate means of determining responsibility in 
a civil and criminal context for submission of data 
by electronic means, snd that any other legal issues 
relating to electronic filings are adequately 
resolved. 

41 The agreement for direct entry privileges 
requires a participating firm to enter electronically 
into MRRS "all information required to be filed on 
Form 8-R * * V" See Agreement ^3. (Exhibit B to 
Petition). 

48 See Agreement \7 (Exhibit B to Petition). 














Federal Register / Vol, 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35931 


In the event that an issue arises as to 
the authenticity of any paper 
application, the participating firm will 
be required, by virtue of its agreement 
with NFA, to produce witnesses to 
testify as to the Firm’s procedures for 
handling, maintaining and processing all 
relevant registration records. NFA staff 
will be available to provide any 
necessary testimony. 

As set forth in NFA’s petition, the 
procedures for Phases II and III of the 
pilot program do not appear to impair 
NFA’s ability to perform its delegated 
duties as official custodian of the 
Commission’s registration records or to 
provide accurate certifications regarding 
the authenticity and completeness of the 
records maintained. 

C. Reliability of Information in MRRS 

As previously discussed, the paper 
registration applications will continue to 
constitute official registration records. 
However, the data entered into MRRS 
also will constitute official registration 
records and will be a primary source of 
current registration information 
requested by the Commission, NFA, 
registrants and the public. Thus, the 
Commission must be assured that the 
direct entry of registration information 
by firms will not compromise the 
reliability of the MRRS data. In this 
regard, the direct entry program raises 
two concerns—first, the reliability of 
data entered into MRRS by firms, and 
second, the potential impact upon MRRS 
data reliability of ongoing direct access 
by firms into the MRRS system. 

1. Reliability of Directly Entered 
Information 

As previously noted, under the direct 
entry program, applicants and their 
sponsors will continue to supply the 
information upon which temporary 
license determinations are made and 
will have the same incentives to provide 
accurate information as under current 
procedures. The willful submission of 
inaccurate registration information is a 
ground for denial, revocation, 
restriction, condition or suspension of 
registration under section 6a(2)(G) and 
section 8a(3)(G) of the Act, 7 U.S.C. 
12a(2)(G) and 12a(3)(G) (1988) “ 
Similarly, the willful submission of 
inaccurate registration or membership 
information is a ground for denial or 
revocation of NFA membership or 
Associate status pursuant to NFA Bylaw 
301(c)(x). 

The firm responsible for entering 
registration information with respect to 
its APs into MRRS would also have 
direct disciplinary liability under NFA 


44 See nn. 9 and 26. 


Compliance Rule 2-2(f) 45 for the willful 
submission of materially false or 
misleading information through direct 
entry into MRRS. In addition, 
unintentional but frequent data-entry 
errors could subject the firm to 
disciplinary action under NFA 
Compliance Rule 2-9 48 for lack of 
appropriate supervision. Finally, a 
participating firm’s failure to diligently 
supervise the execution of the direct 
entry program would constitute a 
violation of Commission Rule 166.3,17 
CFR 166.3 (1989). 47 

A primary incentive for firms to 
exercise care in the data-entry process 
is the risk of losing the benefits 
attendant upon participation in the 
direct entry program, that is, the 
automatic issuance of temporary 
licenses on the basis of an electronic 
filing. The participation of any firm in 
the pilot program, or in any subsequent 
program, will be a privilege, not a 
right. 48 As will be discussed, NFA will 
closely monitor the accuracy of the 
information entered into MRRS by 
participating firms and will terminate 
the direct entry privileges of any 
participant which does not maintain a 
satisfactory accuracy level. The written 
agreement between NFA and each 
participating firm will recognize the 
absolute right of NFA, in its sole 
discretion and without notice, to 
terminate the direct entry privileges of 
any firm whose accuracy rate is below 
levels acceptable to NFA. 49 As set forth 


4S NFA Compliance Rule 2—2(f) provides that no 
NFA member or associate shall willfully submit 
materially false or misleading information to NFA 
or its agents. See Agreement |12 (Exhibit B to 
Petition). 

44 NFA Compliance Rule 2-9 provides that each 
NFA member shall diligently supervise its 
employees and agents in the conduct of their 
commodity futures activities for or on behalf of the 
member. See Agreement fll2 (Exhibit B to Petition) 
(Participant acknowledges that the failure to adopt 
or enforce the supervisory procedures required by 
Paragraph 9 of the Agreement is a violation of NFA 
Compliance Rule 2-9 and CFTC Regulation 166.3). 

47 Commission Rule 186.3.17 CFR 166.3 (1989) 
provides that: 

Each Commission registrant, except an associated 
person who has no supervisory duties, must 
diligently supervise the handling by its partners, 
officers, employees and agents (or persons 
occupying a similar status or performing a similar 
function) of all commodity interest accounts carried, 
operated, advised or introduced by the registrant 
and all other activities of its partners, officers, 
employees and agents (or persons occupying a 
similar status or performing a similar function) 
relating to its business as a Commission registrant. 

See Agreement J12 (Exhibit B to Petition). 

48 See Agreement fll (Exhibit B to Petition). 

44 The Petition cites a 97% accuracy rate for a five- 
day period as illustrative but states NFA’s view that 
the appropriate accuracy rate cannot be determined 
until NFA gains experience with the pilot program. 
The optimal level of accuracy will be determined in 
conjunction with the Commission’s oversight of the 
direct entry program as NFA gains experience with 


in the agreement for firm direct entry 
privileges, a participating firm will have 
no right to a hearing regarding the 
withdrawal of these privileges. 50 

Finally, the direct entry program 
should not provide any materially 
greater incentive or opportunity for a 
firm to falsify data in order to obtain 
automatically a temporary license for an 
AP than under current procedures in 
which a temporary license is granted or 
denied on the basis of self-declared 
information filed on paper registration 
forms: in both instances an outside 
party, the AP applicant or sponsoring 
firm, prepares the data that is supplied 
to NFA. 

2. Review Procedures 

NFA has developed extensive review 
procedures to detect data-entry errors 
and to assure the accuracy of the 
information in MRRS. As described 
earlier, during the pilot program NFA 
will conduct an item-by-item 
comparison between the data entered 
into MRRS and the information on the 
registration form submitted by a 
participating firm. NFA will maintain 
detailed statistics of all errors found so 
that both the Commission and NFA will 
have an adequate basis on which to 
evaluate the pilot program. 

All filings entered by a particular firm 
will receive a complete review for a 
minimum of six months after the firm 
receives direct entry privileges. Every 
item on every paper filing will be 
checked against the same information 
on MRRS during Phases II and III of the 
pilot program and statistics will be kept 
on the accuracy of the data entered by 
each new participant. 

As discussed below, Commission 
approval would be required prior to 
extension of the direct entry program 
beyond Phase III of the pilot program. If 
such approval were granted, NFA 
contemplates that following conclusion 
of the six month period of participation 
by a Firm, NFA will continue to perform 
a comparison between each Form 8-R 
for AP registraton received by NFA and 
the firm’s electronic Filing for each item 
directly related to eligibility for a 
temporary license, including the 
applicant’s name and signature, the 
sponsor’s certification and all questions 
relating to disciplinary history. NFA will 
also perform a name check for 
registration holds where the applicant’s 
social security number is unknown. In 


the pilot program. NFA has committed to provide 
the Commission these statistics as they are 
developed. 

50 A firm denied direct entry privileges could 
continue to register its APs by filing the Form 8-Rs 
directly with NFA. 











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Federal Register / VoL 55 t No. 171 / Tuesday, September 4, 1990 / Notices 


addition, for each participating firm 
NFA will perform an item by item 
comparison of ail information on 
randomly selected forms with the 
corresponding electronic filings. If the 
results of this comparison so warrant, a 
particular firm could be barred from 
participating in the program, as provided 
for in the agreement, or could be subject 
to the more rigorous “Phase III" 
monitoring by NFA. 

Based upon this level of review, NFA 
has represented that it believes that the 
direct entry program will not reduce, 
and potentially could improve, the 
accuracy and reliability of the 
registration data for natural person 
applicants entered into MRRS. 
Incomplete Filings will be corrected 
sooner than under current procedures 
because the computer program will 
detect filings with empty fields or fields 
containing improper characters and will 
use an on-screen message to request 
that the filing be corrected. For example, 
MRRS will detect any filing with an 
unanswered disciplinary history 
question or that contains letters in fields 
that require solely numeric data, such as 
dates, NFA or CFrC identification 
number, or social security number. 

MRRS also is programmed to detect 
filing with time gaps in the employment 
and residential history sections. MRRS 
will accept an incomplete application 
for filing but will not issue a temporary 
license to the applicant until the 
deficiencies are corrected. Therefore, 
the data entered into MRRS by 
participating firms should be at least as 
accurate as the data entered into MRRS 
by NFA personnel or formerly entered 
into the registration database by 
Commission personnel. 

3. Computer Security 

A further concern posed by direct 
entry is the potential impact upon the 
integrity of MRRS data of continued 
access by participating firms to the 
MRRS system. Adequate security 
procedures must be in place to detect 
and prevent any improper use of or 
tampering with data and to duplicate the 
information in MRRS in case of 
destruction or tampering. In this regard, 
NFA has represented that the computer 
security practices currently in use at 
NFA will be extended to the direct entry 
program and will be strengthened as 
discussed below. NRA further has 
represented that while no security 
system is completely fail-proof, the 
security measures that will apply to the 
direct entry program make unauthorized 
access extremely difficult, limit 
exposure if unauthorized access is 
gained and give NFA the ability to 
reconstruct data as it existed prior to 


any tampering. NFA has described the 
following security measures. 

NFA*8 primary security system is 
Resource Access Control Facility 
(RACF) by IBM. RACF protects access 
to MRRS by identifying and verifying 
the person attempting to gain access to 
MRRS, limiting both the screens 
available to the user and the type of 
access (inquiry or entry), and keeping a 
record of unauthorized attempts to gain 
access to MRRS or particular screens 
within MRRS. 

In order to improve efficiency and 
security for remote access to MRRS, 

NFA has joined the IBM Information 
Network. Before a remote user can 
obtain access to NFA’s computer system 
through the IBM Information network, 
the remote user must provide the IBM 
Information Network with NFA's 
account ID, a user ID. and a special 
password that verifies the user’s identity 
and validates the user’s access to the 
IBM Information Network. 

One communication with NFA's 
computer system has been established, 
RACF takes over. RACF requires the 
user to provide a user ID assigned by 
NFA and a password associated with 
the ID. The user ID identifies the person 
who is trying to gain access to the 
system and the password verifies that 
the person who is trying to gain access 
is the same person that the ID has been 
assigned to. The password is changed 
every 30 days in order to ensure its 
integrity. 

The remote user is given three 
chances to enter the correct user ID and 
password before RACF disables the ID. 
The disabled user ID cannot be used 
even if a correct password is 
subsequently entered The NFA Security 
Administrator is the only person who 
can reinstate the ID. NFA employs two 
people in the role of Security 
Administrator. These two individuals 
together have 30 years of experience in 
data processing and technical support. 

In other words, in order to gain off¬ 
site access to NFA's computer system, 
an individual would have to know five 
different pieces of information: NFA’s 
IBM Information Network account 
number, a user ID and a password for 
access to the IBM Information Network, 
and a user ID and password for access 
to NFA’s computer system. 

Computer security does not end once 
an authorized user has gained access to 
the system. Every authorized user has 
his or her own unique security profile. 
This profile, which is created by the 
NFA Security Administrator, determines 
which screens and fields the user is 
allowed to view and which screens and 
fields the user is allowed to update. For 


example, based on this profile, RACF 
will not allow a participant in Phase I of 
the pilot program to view non-public 
information to which it is not otherwise 
entitled or to update any information on 
MRRS, and a Phase Il/Phase III 
participant will not be able to update 
information in the files of an unaffiliated 
firm. 

RACF logs all attempts to gain 
unauthorized access to the system or to 
any screen or field within the system. 
RACF also records authorized access to 
the system. If the NFA Security 
Administrator notices unusual activity 
connected with any user ID, the ID can 
be disabled until the activity is 
investigated and explained. 

Furthermore, in the highly unlikely event 
that the data in the computer system is 
damaged or destroyed, NFA could 
utilize the record of use generated by 
RACF to try to determine the source of 
the damage. 

To further enhance security, any 
terminal which remains inactive for ten 
to twenty minutes is automatically 
signed off by the computer. Thus, if the 
user leaves his or her station and forgets 
to sign off, RACF will automatically sign 
the user off, thereby reducing the chance 
of unauthorized access through an 
unattended terminal. It should also be 
noted that participating firms will not 
have programming access to NFA’s 
computer system. 

In the highly unlikely event that data 
in the computer system is damaged or 
destroyed. NFA can easily reconstruct 
the data at the point immediately prior 
to damage or destruction. NFA utilizes 
the Journaling Facility of the Computer 
Associates’ Integrated Database 
Management System DATA BASE 
product to record all changes to the data 
in the system. This journal shows the 
data as it existed before the change, the 
data as changed, and the cause of the 
change. By looking at the journal, NFA 
personnel can determine when any 
damage occurred. NFA also keeps a 
record of the data on the system as of 
the end of each day. This information is 
copied on computer tape. In addition to 
being kept at NFA, the information is 
stored off site where it is protected in 
the unlikely event of a computer virus in 
the system. 

No computer security system can keep 
a person with authorized access from 
entering false information in the fields 
where the user has authorization to 
enter or change data. However, the pilot 
program addresses this problem as well. 
All TL sensitive items on ail AP 
applications will always be completely 
reviewed once the paper filing is 
received. These crucial items include 










Federal Register / Vol. 55 . No. 171 / Tuesday. September 4. 1990 / Notices 


35933 


name, signature, sponsors certification, 
and the SDDI questions. Furthermore, 
less sensitive items on the actual 
registration forms will be spot checked 
against the data entered directly into 
MRRS by each Firm. Therefore, false 
answers to the SDDI questions and 
other TL sensitive information should be 
detected and the accuracy of all other 
data will be monitored through spot 
checking. If a paper filing to support the 
change is not received by NFA within 
five business days after the electronic 
Filing, the TL will be automatically 
terminated. 

With respect to audits of NFA's 
computer security system. NFA’s 
Information Systems Department is in 
the process of hiring a quality assurance 
auditor with substantial experience and 
proven expertise in the Field. On an 
ongoing basis, the quality assurance 
auditor will audit computer security 
procedures and standards to ensure that 
they are being complied with and are 
consistent with NFA’s needs. The 
quality assurance auditor will also 
review reports produced by RACF 
which provide information on the status 
of the computer security environment 
and allow the quality assurance auditor 
to compare the actual level of security 
with the planned level of security. NFA 
is also joining the Quality Assurance 
Institute to ensure that the quality 
assurance auditor keeps up with the 
latest developments. 

We also note that Arthur Andersen’s 
annual audit of NFA includes a review 
of NFA’s written computer security 
procedures. However, no attempt is 
made to break into MRRS by Arthur 
Andersen during its audit 

While no data storage system, 
whether electronic or manual, is immune 
to tampering, the measures instituted by 
NFA appear to provide a reasonable 
level of security that limits access, 
detects tampering and provides an 
ability to recreate data. In this regard, 
direct entry does not appear to 
introduce any increased possibilities for 
the improper entry of registration data. 

D. Consistency with Commission Orders 
and Policy 

The Commission believes that the 
direct entry program is not inconsistent 
with previous orders delegating 
registration responsibilities to NFA. 
Under the direct entry program, NFA 
will continue to be the entity making the 
registration determinations. The Filed 
Commission registration forms will 
continue to constitute the primary 
registration record. 51 The direct entry 


** A* previously noted. Ihe agreement signed by 
participating firms requires the firm to enter data 


program merely substitutes, on a 
temporary basis, the electronic filing of 
data for the current paper transmission 
of data. In both circumstances, the 
applicant data relied upon by NFA is 
generated by the applicant and 
sponsoring firm. In this regard, direct 
entry is analogous to the use of outside 
data processing firms to encode data 
into a computer system. 

As a result of the direct entry 
program, temporary licenses can be 
granted earlier than under current 
procedures, because the information on 
which the temporary license is granted 
will be filed electronically rather than 
filed by mail or hand delivery; the delay 
necessitated by current manual data- 
entry of paper application information 
by NFA personnel will be eliminated; 
and the decision on a temporary license 
would be transmitted to the firm 
instantly via computer screen. The 
Commission believes that this procedure 
is consistent both with Congressional 
policy underlying the temporary license 
procedure and Commission policy as 
reflected in existing registration 
procedures. The legislative history of the 
Futures Trading Act of 1982 reflects that 
in adopting the temporary licensing 
provision, Congress intended that 
applicants who are apparently qualified 
should be granted temporary licenses as 
expeditiously as possible and that the 
determination as to whether an 
applicant appears to be qualiFied would 
be based on whether a statutory 
disqualification under section 8a(2) or 
8a(3) of the Act has been disclosed by 
the applicant. 52 

Moreover, the direct entry phase of 
the pilot program does not alter the 
substantive criteria upon which 
temporary licensing determinations or 
final registration determinations are 
made. Rule 3.40 requires the 
contemporaneous filing of three 
documents prior to the issuance of a 
temporary license; a properly completed 
Form 8-R. a fingerprint card and a 
signed sponsor’s certification. Although 
NFA’s pilot program will depart from 
current procedures with respect to how 
and when such information is initially 
transmitted to NFA, 53 it will not affect 


electronically thal mirrors the data on the Form 8-R. 
3-R or S-T. Thus, any discrepancy between the 
direct entry data and the paper registration form 
would be decided in favor of the latter. 

H R Rep. No. 565 (pari 1). 97th Cong. 2d Seas. 
50(1982). 

** For example, Commission Rule 3 40 provides 
that the NFA may grant a temporary license to any 
applicant for registration as an associated person 
upon the contemporaneous filing with NFA of a 
Form 6-R. the fingerprint card and the sponsor's 
certification. The direct entry program allows NFA 
to grant a temporary license in reliance upon the 
electronic filing, at a maximum of five days prior to 


the type of information actually 
obtained or the basis upon which 
temporary licensing determinations are 
made. 

NFA will continue to determine 
whether applicants are subject to 
statutory disqualifications under Section 
6a(2) or 8a(3) of the Act. The only 
difference will be that NFA's initial 
review will be based on an electronic 
filing of the identical information that is 
now submitted on the paper filing of the 
Form 8-R. Moreover, that fact that the 
fingerprint care will be received by NFA 
after a temporary license determination 
has been made by NFA is immaterial 
since temporary license determinations 
currently are made prior to completion 
of the fingerprint screening conducted 
by the FBI. Finally, under the pilot 
program, NFA would continue to require 
that participating firms inquire into the 
backgrounds of potential AP 9 ; however, 
the firm’s certification that it has in fact 
performed a background check will 
initially be transmitted electronically 
rather than on paper. 

In summary, the Commission believes 
that NFA's direct entry program should 
have no adverse impact upon the 
process for granting temporary licenses 
or for making final registration 
determinations. 

E. Potential Benefits of Direct Entry 

NFA has identified several potential 
benfits of direct entry. Direct entry of 
data will transfer the data entry function 
from NFA to firm sponsors, thereby 
allowing NFA personnel to devote more 
time to the reveiw of applications. Direct 
entry also should, reduce the time 
entailed in correcting deficient 
applications, since the sponsoring firm 
entering the data into the NFA computer 
system will be presented with a series of 
screens which will identify needed 
information to the sponsor 
instantaneously. Direct entry should 
reduce the time required to grant 
temporary licenses by eliminating 
delays due to physically delivering 
registration forms to NFA, transferring 
such data to MRRS by NFA personnel, 
and notifying applicants by mail of 
temporary licensing determinations. 

Conclusion and Order 

Based upon the foregoing, the 
Commission believes that the direct 
entry program can be implemented in a 
manner that is consistent with NFA’s 
registration responsibilities under prior 
Commission orders and with the 


receiving the Form 8-R and fingerprint card. See 
atso Rule 3,42.17 CFR 3.42 (1989) (termination of a 
temporary license). 










35934 


Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Notices 


required degree of accuracy, reliability 
and security for NFA registration 
processing and fitness screening. In this 
regard, however, the Commission notes 
that the direct entry program procedures 
are at variance with the filing 
procedures currently mandated by both 
Commission regulations and parallel 
NFA rules. 64 Because entry program is 
structured initially as a pilot program 
limited to specified participating firms 
and is subject to ongoing Commission 
oversight, the Commission believes that 
consideration of amendments of the 
relevant Commission and NFA rule 
should await a full evaluation of the 
operation of the pilot program. 
Therefore, the Commission is approving 
Phases II and III of NFA's pilot direct 
entry program as a limited exception to 
the Commission’s registration 
procedures applicable only to specified 
participating firms. The Commission 
anticipates that amendments to 
Commission and NFA registration rules 
to make direct entry universally 
available would be made only after a 
complete evaulation of the pilot phases 
of the program. In addition, extension of 
Phase III beyond a period of six months 
from its commencement will require 
Commission approval. 

Accordingly, pursuant to sections 
8 a(l) and 8a(10) of the Commodity 
Exchange Act, 7 U.S.C. 12a(l) and 
12 a(10) (1988), the Commission hereby 
authorizes the National Futures 
Association to implement the direct 
entry pilot program as described by, and 
subject to, the conditions set forth 
below. 

1. The direct entry pilot program is 
described in the Petition dated January 5, 
1989, including Exhibits A (MRRS Individual 
Processing System), B (Agreement for Firm 
Direct Entry Privileges. 01/05/89 draft), C and 
D (MRRS Direct Entry Pilot Program Monthly 
Report, Phases 11 and III, respectively), as 
supplemented by submissions discussing 
computer security measures dated September 
28,1989 and July 10,1990 and by a letter 
concerning the length of Phase II dated July 
17,1990. The commitments set forth in the 
Petition constitute the responsibilities of NFA 
unless otherwise stated or modified by this 
Order. 

2. Implementtion of Phase III of the direct 
entry program is subject to Commission 
disapproval based upon review of the results 
of Phase II. Unless extended by the 
Commission. Phase UI of the direct entry 
program will terminate six months after its 
commencement. 

3. The firms authorized to participate in the 
direct entry program are: Merrill. Lynch, 
Pierce. Fenner & Smith, Shearson Lehman 
Brothers, Inc., Dean Witter Reynolds. Inc., 
Geldermann, Inc., R.J. O’Brien, Inc., 

Prudential Bache Securities, Inc., Goldman 


14 See n. 53. 


Sachs & Co.. Cargill Investor Services, Inc., 
BT Futures Corp. and Brokers Resources 
Corp. Additional firms may be added only 
with the prior approval of the Commission's 
Division of Trading and Markets. 

4. In addition to providing the statistics 
described in the Petition, NFA will provide 
the Commission with such data as may be 
requested from time to time concerning the 
direct entry program. 

5. In addition to terminating temporary 
licenses pursuant to the provisions of 
Commission Rule 3.42,17 CFR 3.42 (1989), 
NFFA or the Commission shall immediately 
terminate a temporary license granted under 
the direct entry program if the applicant or 
sponsoring firm fails to provide NFA with 
fingerprint cards, registration forms and any 
required supporting data within five business 
days of the date the sponsoring firm enters a 
command for MRRS to process the 
information entered into MRRS; if NFA’s 
verification of the submitted registration 
forms and fingerprint cards discloses that the 
applicant is not eligible for a temporary 
license; or where the license was granted by 
mistake or as a result of fraudulent means. 

6. This order may be revoked or modified 
at the discretion of the Commission. 

Issued in Washington, DC on August 28, 
1990 by the Commission. 

Jean A. Webb, 

Secretary of the Commission. 

[FR Doc. 90-20639 Filed 8-31-90; 8:45 amj 
BILLING CODE 6351-01-M 


DEPARTMENT OF DEFENSE 

Department of the Army 

\ 

U.S. Army Laboratory Command, DoD; 
Patent Licenses, Partially Exclusive, 
Schodowsky, S.S. 

action: Final notice of prospective 
partially exclusive licenses. 

summary: In accordance with 37 CFR 
404.7, announcement is made of 
prospective partially exclusive licenses 
of a Dual Mode Quartz Resonator Self- 
Temperature Sensing Device. Further 
applications for licenses in this matter 
will not be entertained. This action is 
being made final. 

FOR FURTHER INFORMATION CONTACT: 

Mr. William H. Anderson, Intellectual 
Property Law Division, U.S. Army 
Communications-Electronics Command, 
ATTN: AMSEL-LG-L, Fort Monmouth, 
NJ 07703-5000, COMM: (201) 532-4112. 
SUPPLEMENTARY INFORMATION: 
Heretofore Notice of Prospective 
Partially Exclusive Licenses was 
published on Thursday, June 28,1990, 55 
FR 26479. In consideration of the 
objections received thereon, the 
following actions will be taken: 

The granting of partially exclusive 
licenses for U.S. Patent No. 4,872,765, 


issued to S.S. Schodowsky on October 
10,1989, will be considered for the 
parties listed below: 

—Q-Tech Corporation, 10150 W. 
Jefferson Blvd., Culver City, CA 
90232-3501; 

—Frequency Electronics, Inc., 55 Charles 
Lindberg Blvd., Mitchel Field, NY 
11553; 

—Motorola Inc., 1303 E. Algonquin Rd., 
Schaumburg, IL 60196-1065; 

—Piezo Crystal Co., 100 K St., P.O. Box 
619, Carlisle. PA 17013; 

—Vectron Laboratories, Inc., 166 Glover 
Ave., Norwalk, CN 06850; 

—Piezo Technology, Inc., P.O. Box 
547859, Orlando, FL 32854-7859; and 
—Ball, Efratom Division, 3 Parker. Irvin, 
CA 92718-1605 
Kenneth L. Denton, 

Alternate Army Liaison Officer with the 
Federal Register. 

(FR Doc. 90-20753 Filed 8-31-90; 8:45 am) 

BILUNG CODE 3710-08-M 


Department of the Navy 

Public Hearing for the Draft 
Environmental Impact Statement for 
Possible Base Closure/Realignment of 
Naval Ordnance Station, Louisville, KY 

Pursuant to Council on Environmental 
Quality regulations (40 CFR parts 1500- 
1508) implementing procedural 
provisions of the National 
Environmental Policy Act, the 
Department of the Navy prepared and 
filed with the U.S. Environmental 
Protection Agency the Draft 
Environmental Impact Statement (DEIS) 
for possible base closure/realignment of 
Naval Ordnance Station 
(NAVORDSTA) Louisville, Kentucky. 

The DEIS has been distributed to 
various federal, state, and local 
agencies, elected officials, special 
interest groups and the media. In 
addition, the DEIS has been distributed 
to the following libraries in the 
Louisville metropolitan region: 

Louisville Free Library, Main Library. 

310 York Street, Louisville, KY. 
Louisville Free Library, Valley Station 
Branch, 6505 Bethany Lane, Louisville, 
KY. 

Louisville Free Library, Newman 
Branch, 3920 Dixie Highway, 
Louisville, KY. 

Louisville Free Library, Okolona Branch. 

8003 Preston Highway, Louisville, KY. 
Louisville Free Library, Valley Shawnee 
Branch, 3912 W. Broadway, Louisville, 
KY. 

Louisville Free Library, Iroquois Branch 
601 W. Woodlawn, Louisville, KY. 

















Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35935 


Louisville Free Library. Bon Air Branch. 

2816 Del Rio Place. Louisville. KY. 
Jefferson Twp. Public Library. 211 East 

Court Avenue, Jefferson. IN. 

New Albany-Floyd County Public 

Library. 180 W. Spring Street. New 

Albany, IN. 

A limited number of single copies are 
available at the address listed at the end 
of this notice. 

A public hearing to inform the public 
of the DEIS findings and to solicit 
comments will be held on September 20. 
1990. from 6:30 p.m. to 10*30 p.m.. at the 
NAVORDSTA Louisville Cafeteria. 
Louisville. Kentucky. 

The public hearing will be conducted 
by the U.S. Navy. Federal, state, and 
local agencies and interested parties are 
invited and urged to be present or 
represented at the hearing. Oral 
statements will be heard and 
transcribed by a stenographer however, 
to assure accuracy of the record all 
statements should be submitted in 
writing. Ail statements, both oral and 
written, will become part of the public 
record on this study. Equal weight will 
be given to both oral and written 
statements. 

In the interest of available time, each 
speaker will be asked to limit their oral 
comments to five (5) minutes. If longer 
statements are to be presented, they 
should be summarized at the public 
hearing and submitted in writing either 
at the hearing or mailed to the address 
listed at the end of this announcement. 
All written statements must be 
postmarked by October 15,1990, to 
become part of the official record. 

On January 29,1990, the Secretary of 
Defense announced a list of defense 
installations to be studied for possible 
closure/realignment in response to 
possible reductions in military force 
structure. Included on this list was 
NAVORDSTA Louisville. 

The primary mission of NAVORDSTA 
Louisville is the modernization, 
overhaul, and repair of naval ordnance 
systems. As part of the projected force 
level reductions. NAVORDSTA 
Louisville was identified for study in 
order to examine whether overall 
management efficiency of the Navy 
could be improved. 

Alternatives considered in the DEIS 
are closure of NAVORDSTA Louisville 
and No Action. Under the closure 
alternative, all naval activities would 
either be disestablished or relocated to 
other Defense Department installations 
or private industry. The No Action 
alternative considers the continuation of 
functions for the installations under 
study, though some reduction in 
operation could occur as a result of 
force structure reductions. No preferred 


alternative has been identified in the 
DEIS. 

The direct impacts of full closure 
would result in the los9 of 12 military 
personnel and about 2.350 civilian 
positions- Total secondary employment 
impacts from full closure would include 
the loss of an additional 1.500 to 2,200 
jobs. 

Several large machine tools have been 
identified as potentially eligible for 
listing on the National Register of 
Historic Places. Consultation procedures 
noted in 36 CFR part 800 would be 
followed for actions that may affect 
eligible cultural resources. 

There are recognized unmitigated 
hazardous material sites on 
NAVORDSTA Louisville that would 
have to be remediated as necessary in 
accordance with the Navy’s Installation 
Restoration Program. This remediation 
would be accomplished whether or not 
NAVORDSTA Louisville is closed. 

Under the closure alternative new 
construction would be required at 
several of the receptor locations where 
functions may be transferred. 

Additional information concerning 
this notice may be obtained by 
contacting the Commander. Atlantic 
Division, Naval Facilities Engineering 
Command, (Attn: Mr. Jim Haluska, Code 
2032, telephone (804) 445-2334). Norfolk, 
VA 23511-6287. 

Dated: August 29.1990. 

Saundra K. Melancon, 

Department of the Navy. Alternate Federal 
Register Liaison Officer. 

[FR Doc. 90-20717 Filed 8-31-90; 8:45 am| 
BILUNG CODE M10-AE-V 


DEPARTMENT OF EDUCATION 

Proposed Information Collection 
Requests 

AGENCY: Department of Education. 
action: Notice of proposed information 
collection requests. 

SUMMARY: The Director, Office of 
Information Resources Management, 
invites comments on the proposed 
information collection requests as 
required by the Paperwork Reduction 
Act of 1980. 

dates: Interested persons are invited to 
submit comments on or before October 
4.1990. 

ADDRESSES: Written comments should 
be addressed to the Office of 
Information and Regulatory Affairs 
Attention: Dan Chenok, Desk Officer. 
Department of Education. Office of 
Management and Budget. 726 Jackson 
Place. NW., room 3208. New Executive 


Office Building. Washington. DC 20503 
Requests for copies of the proposed 
information collection requests should 
be addressed to James O’Donnell. 
Department of Education. 400 Maryland 
Avenue SW.. room 5824, Regional Office 
Building 3. Washington. DC 20202. 

FOR FURTHER INFORMATION CONTACT* 
James O’Donnell (202) 708-5174. 
SUPPLEMENTARY INFORMATION: Section 
3517 of the Paperwork Reduction Act of 
1980 (44 U.S.C. chapter 35) requires that 
the Office of Management and Budget 
(OMB) provide interested Federal 
agencies and the public an early 
opportunity to comment on information 
collection requests. OMB may amend or 
waive the requirement for public 
consultation to the extent that public 
participation in the approval process 
would defeat the purpose of the 
information collection, violate Slate or 
Federal law. or substantially interfere 
with any agency's ability to perform its 
statutory obligations. 

The Acting Director, Office of 
Information Resources Management, 
publishes this notice containing 
proposed information collection 
requests prior to submission of these 
requests to OMB. Each proposed 
information collection, grouped by 
office, contains the following: 

(1) Type of review requested, e.g.. 
new, revision, extension, existing or 
reinstatement; (2) Title; (3) Frequency of 
collection; (4) The affected public; (5) 
Reporting burden; and/or (6) 
Recordkeeping burden; and (7) Abstract. 
OMB invites public comment at the 
address specified above. Copies of the 
requests are available from James 
O’Donnell at the address specified 
above. 

Dated: August 28.1990. 

James O’Donnell, 

Acting Director, for Office of Information 
Resources Management 

Office of Special Education and 
Rehabilitative Services 

Type of Review: Revision. 

Title: Evaluation of State Vocational 
Rehabilitation Activities in Drug/ 
Alcohol Rehabilitation. 

Frequency: One-time. 

Affected Public: State or local 
governments. 

Reporting Burden: 

Responses: 756. 

Burden Hours: 1051. 

Recordkeeping Burden: 

Recordkeepers: 0. 

Burden Hours: 0. 

Abstract: The purpose of this study is to 
determine the constellation of services 
that best contribute to the 











35936 


Federal Register / Vol. 55 f No. 171 / Tuesday, September 4, 1990 / Notices 


rehabilitation of alcohol and drug 
dependent clients within VR State 
agencies. 

[FR Doc. 90-20647 Filed 6-31-90; 8:45 am] 

BILLING COPE 4000-01-41 


DEPARTMENT OF ENERGY 

Financial Assistance Award; Intent to 
Award Grant to Robert E. Bode 

agency: U.S. Department of Energy. 
action: Notice of unsolicited assistance 
award. 

SUMMARY: The Department of Energy 
announces that pursuant to 10 CFR 
600.14, it is making a financial 
assistance award under Grant Number 
DE-FG01-90CE15465 to Robert E. Bode, 
to complete the development and testing 
of fieldworthy methods and apparatus 
for placing and monitoring oil plugs in 
oil and gas wells. 

SCORE: This grant will provide funding 
in the estimated amount of $42,355 to 
improve the inherent efficiency of 
placing cement plugs. The correct 
placement of cement plugs in an oil well 
is important for its production operation 
to extend its productive life. This project 
drastically decreases the amount of 
drill-rig time required to place the plugs. 
It does so by allowing the plug to be 
monitored while being placed and by its 
unique ability to place multiple cement 
plugs without removing the pipe string 
from the well bore. The inventor 
estimates, and the National Institute of 
Standard and Technology (NIST) 
concurs, that placement mistakes cost 
the industry around $2 billion each year 
from the combination of additional drill- 
rig time required, escalating capital and 
labor costs from the combination of 
wasted efforts, and wasted energy. NIST 
believes that the invention has a 
substantial and timely market niche, 
especially in off shore drilling, because 
it reduces the drill rig and energy costs 
required for developing oil and gas 
fields that now are economically 
marginal because of their currently high 
development cost. 

eligibility: Eligibility for award is being 
limited to Robert E. Bode, the inventor, 
based on acceptance of an unsolicited 
application. Mr. Bode and his company 
will be the demonstrator and licensor of 
this new system for the placement of 
cement plugs in wells. As soon as the 
advanced prototype is successfully 
demonstrated, as appears probable, it 
should be readily accepted in the 
marketplace. 

In accordance with 10 CFR 
600.14(c)(1), it has been determined that 
this project represents a unique idea 


that is not eligible for financial 
assistance under a recent, current, or 
planned solicitation. The funding 
program, Energy-Related Inventions 
Program (ERIP), has been structured 
since its beginning in 1975 to operate 
without competitive solicitations 
because the legislation directs ERIP to 
provide support for worthy ideas 
submitted by the public. The proposed 
project and technology have a strong 
potential of adding to the national 
energy resources. 

The term of this grant shall be for two 
(2) years from the effective date of 
award. 

FOR FURTHER INFORMATION CONTACT: 

U.S. Department of Energy, Office of 
Procurement Operations. ATTN: 
Bernard G. Canlas, PR-542,1000 
Independence Avenue SW., 
Washington, DC 20585. 

Thomas S. Keefe, 

Director, Contract Operations Division "B’\ 
Office of Procurement Operations. 

(FR Doc. 90-20738 Filed 8-31-90; 8:45 am] 

BILLING COOE 6450-01-M 


Financial Assistance Award; Intent to 
Award Grant to University of 
Missouri—Rolla 

agency: U.S. Department of Energy. 
action: Notice of unsolicited assistance 
award. 

SUMMARY: The Department of Energy 
announces that pursuant to 10 CFR 
600.14, it is making a financial 
assistance award under Grant Number 
DE-FG01-90CE15467 to the University of 
Missouri—Rolla to investigate the 
applicability of high-pressure jet 
lubricooling to the milling of titanium. 
SCOPE: This grant will provide funding 
in the estimated amount of $82,941 for 
improving the technology that will result 
in faster milling of titanium at reduced 
energy consumption, a fact that will be 
of interest to manufacturers of titanium 
parts. Achieving this improved 
technology will encourage the 
application of new milling technique to 
new materials in addition to titanium. 
The probability of achieving the 
improvement in titanium milling rates 
and finishes is very high. The principal 
investigator has spent several years in 
development of the high-pressure jet 
techniques. Independent experts on 
titanium have agreed that there are no 
apparent barriers to successful 
application of the technology. 
eligibility: Eligibility for this award is 
being limited to Curators of the 
University of Missouri for the University 
of Missouri—Rolla. The principal 


investigator is Dr. Marian Mazurkiewicz 
an expert in the fields of: fine 
manufacturing equipment; high-pressure 
water jets for cutting, cleaning, 
excavating, and disintegrating; and 
metal machining with the assistance of 
high-pressure water jets. He spent the 
first 20 years of his career at Wroclaw 
Technical University in Poland before 
transferring to the University of 
Missouri at Rolla in 1981. He has more 
than 100 publications, 12 patents, and a 
total of 17 disclosures awaiting patents 
through the University of Missouri and 
is eminently qualified to perform the 
work to be funded by the proposed 
grant. Since his association with the 
University of Missouri—Rolla, he has 
served as the principal investigator on 
more than 10 research projects for the 
agencies such as the Department of 
Energy and the Interior and corporate 
clients including General Motors. 

In accordance with 10 CFR 
600.14(e)(1), it has been determined that 
this project represents a unique idea 
that is not eligible for financial 
assistance under a recent, current, or 
planned solicitation. The funding 
program Energy-Related Inventions 
Program (ERIP), has been structured 
since its beginning in 1975 to operate 
without competitive solicitations 
because the legislation directs ERIP to 
provide support for worthy ideas 
submitted by the public. The proposed 
project and technology have a strong 
potential of adding to the national 
energy resources. 

The term of this grant shall be for two 
(2) years from the effective date of 
award. 

FOR FURTHER INFORMATION CONTACT: 

U.S. Department of Energy, Office of 
Procurement Operations, ATTN: 

Bernard G. Canlas, PR-542,1000 
Independence Avenue SW., 

Washington, DC 20585. 

Thomas S. Keefe, 

Director, Contract Operations Division “B", 
Office of Procurement Operations. 

[FR Doc. 90-20736 Filed 8-31-90; 8:45 am] 

BILUNG CODE 6450-01-M 


Intent To Award Grant To National 
Academy of Sciences 

agency: Department of Energy. 
action: Notice of intent to make a non¬ 
competitive financial assistance award. 

summary: The Department of Energy 
announces that it plans to make a non¬ 
competitive financial assistance award 
of $50,000, under grant number DE- 
FG01-90RW00214, to the National 
Academy of Sciences (NAS) to provide 






















Federal Register / Vol. 55, No. 171 / Tuesday, September 4 t 1990 / Notices 


35937 


support for the Geotechnical Board. 

NAS will support efforts in developing a 
program for nuclear waste management, 
in particular, the disposal of waste in a 
mined geologic repository. NAS is a 
uniquely qualified, unbiased, external 
organization chartered by Congress in 
1863, to conduct studies in the fields of 
Science and Art when called upon by 
the Government. 

FOR FURTHER INFORMATION CONTACT: 

U.S. Department of Energy, Office of 
Procurement Operations, Attn: Herbert 
D. Watkins, PR-321.1,1000 
Independence Ave., SW. Washington, 
DC 20585, Telephone No. (202) 586-1026. 

Jeffrey Rubenstein, 

Director, Operations Division "A ", Office of 
Placement and Administration. 

[FR Doc. 96-20737 Filed 8-31-90; 8:45 a.m.) 

BILLING CODE 6450-01-II 


Federal Energy Regulatory 
Commission 

[Docket Nos. ER90-557-000, et al.] 

Western Massachusetts Electric 
Company, et al.; Electric Rate, Small 
Power Production, and Interlocking 
Directorate Filings 

Take notice that the following filings 
have been made with the Commission: 

1. Western Massachusetts Electric Co. 

[Docket No. ER90-557-000] 

August 24.1990. 

Take notice that on August 23,1990, 
Northeast Utilities Service Company, on 
behalf of Western Massachusetts 
Electric Company, tendered for filing a 
letter agreement provided for an 
extension to the term of three currently 
filed transmission service agreements 
between Western Massachusetts 
Electric Company and New England 
Power Company. 

Comment date : September 12,1990, in 
accordance with Standard Paragraph E 
at the end of this notice. 

2. Wisconsin Power & Light Co. 

[Docket No. ER90-319-000] 

August 24.1990. 

Take notice that on August 23,1990, 
Wisconsin Power & Light Company 
tendered filing further information 
concerning certain aspects of the 
combustion turbine agreement filed for 
approval in this docket. 

Comment date: September 12,1990, in 
accordance with Standard Paragraph E 
end of this notice. 


3 . West Texas Utilities Co. 

[Docket No. ER96-556-000] 

August 24.1990. 

Take notice that on August 23,1990, 
West Texas Utilities Company tendered 
for filing an agreement for remote 
interrogation of metering recorders 
between West Texas Utilities Company 
and Brazos Electric Power Cooperative, 
Inc. 

Comment date: September 12,1990, in 
accordance with Standard Paragraph E 
at the end of this notice. 

Standard Paragraphs 

E. Any person desiring to be heard or 
to protest said filing should file a motion 
to intervene or protest with the Federal 
Energy Regulatory Commission, 825 
North Capitol Street, NE„ Washington, 
DC 20426, in accordance with Rules 211 
and 214 of the Commission’s Rules of 
Practice and Procedure (18 CFR 385.211 
and 385.214). All such motions or 
protests should be filed on or before the 
comment date. Protests will be 
considered by the Commission in 
determining the appropriate action to be 
taken, but will not serve to make 
protestants parties to the proceeding. 
Any person wishing to become a party 
must file a motion to intervent. Copies of 
this filing are on file with the 
Commission and are available for public 
inspection. 

Lois D. Cashell, 

Secretary. 

[FR Doc. 90-20667 Filed 8-31-90; 8:45 am] 
BILLING CODE 6717-01-N 


[Project Nos. 1417-001 et al.) 

Hydroelectric Applications (Central 
Nebraska Public Power and Irrigation 
District et al.); Applications Filed With 
the Commission 

Take notice that the following 
hydroelectric applications have been 
filed with the Commission and are 
available for public inspection: 

1 a. Type of Application: Major 
License. 

b. Project No.: 1417-001. 

c. Date filed: June 28,1984 and 
supplemented June 4,1990. 

d. Applicant: Central Nebraska Public 
Power and Irrigation District. 

e. Name of Project: Kingsley Hydro 
Project. 

f. Location: On the North Platte River 
in Keith County, Nebraska. 

g. Filed Pursuant to: Federal Power 
Act. 16 U.S.C. 791(a)—825(r). 

h. Applicant Contact: Mr. Tom 
Watson, Crowell & Mooring. 1001 
Pennsylvania Avenue, Washington, DC 
20004, (202) 624-2500. 


i. FERC Contact: Ed Lee, (202) 357- 
0809. 

j. Comment Date: October 5.1990. 

K. Description of Project: The existing 
operating project was issued an Initial 
license in 1937 which expired on July 29. 
1987. The licensee has filed for a new 
license for the continue operation of the 
project with no new construction 
proposed. 

The project consists of: (1) Lake 
McConaughy with gross storage 
capacity of 1,790,00 acre-feet and 
surface area of 30,500 acres at normal 
maximum surface elevation of 3265.0 
feet m.s.l.; (2) Kingsley Dam, an earth 
structure about 3 miles long and 163 feet 
high with an outlet tower and outlet 
conduit 415 feet long, 19 feet-in-diamter, 
capable of discharging about 5,720 cfs, a 
morning glory spillway with twelve 
gates capable of discharging about 
54,000 cfs, and an emergency spillway 
475 feet wide capable of discharging 
about 50.000 cfs; (3) Kingsley 
powerhouse, located at the right 
abutment of Kingsley dam, with a single 
52,000-HP Turbine and a 50-MW 
generator; (4) Lake Ogallala located at 
the toe of the Kingsley Dam with a 
usuable storage of 4,200 acre-feet and 
surface area of 640 acres at normal 
maximum surface elevation of 3126.5 
feet m.s.l.; the “east arm” of the lake is 
the FERC licensed Project No. 1835; (5) a 
Diversion Dam located about 50 miles 
downstream from Kingsley Dam, the 
dam is 874 feet long with concrete ogee 
spillway and sixteen radial gates; (6) a 
supply canal consisting of a 26.9-mile- 
long Jeffrey Section and a 48.6-mile-long 
Johnson Section with headgate 
structures, radial gate check structures, 
and 23 dams and impoundments of 
which 10 are on the Jeffrey Section and 
13 on the Johnson Section; (7) Jeffrey 
Regulating Reservioir, the largest of the 
ten (10) impoundments on the Jeffrey 
Section of the supply canal, has a gross 
storage of 11,500 acre-feet and surface 
area of 575 acres at normal maximum 
surface elevation of 2758.0 feet m.s.l.; (8) 
Jeffrey Dam. an earth structure, 1,034 
feet long and 70 feet high; (9) a 700-foot 
long inlet canal which connects the 
Jeffrey powerhouse; (10) Jeffrey Hydro 
with two turbines each at 13,000 HP and 
two generators each rated at 9 MW; (11) 
Johnson Regulating Reservoir, the 
largest of the thirteen impoundments on 
the Johnson Section of the supply canal 
has a gross storage of 52,200 acre-feet 
and surface area of 2,500 acres at 
normal maximum surface elevation of 
2619.0 feet m.s.l.; (12) Johnson Dam an 
earth structure, 4,958 feet long and 47 
feet high; (13) a forebay canal about 
6,495 feet long, converying water from 








35333 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Notices 


the Johnson Regulating Reservoir to the 
Johnson No. 1 Hydro; (14) Johnson No. 1 
Hydro, has two turbines each at 13,000 
HP and two generators each rated at 9 
MW; (15) Johnson No. 2 Hydro, located 
about 5.7 miles downstream from the 
Johnson No. 1 Hydro, has one single 
25,000-HP turbine and an 18-MW 
generator, and (16) an intake channel, 
152 feet long and 14 feet wide, located 
downstream from the Johnson No. 2 
Hydro, conveying condenser cooling 
water to the 109-MW Canaday Stream 
Electric Station; (17) a 60 mch-in- 
diameter concrete pipe which returns 
the condenser cooling water to the 
supply canal; and (18) appurtenant 
facilities. 

L Purpose of Project Project power 
would continue to be utilized in the 
applicant’s power generation system. 

m. This notice also consists of the 
following standard paragraphs: B, C, 
and Dl. 

2 a. Type of Application: Major 

I irpnco 

b. Project No.: 1835-013. 

c. Date filed: June 28,1984 and 
supplemented June 4,1990. 

d. Applicant Nebraska Public Power 
District. 

e. Name of Project Sutherland Hydro 
Project. 

f. Location: On the North Platte River 
in Keith County. Nebraska. 

g. Filed Pursuant to: Federal Power 
Act. 18 U.S.C. 791(a}-825(r). 

h. Applicant Contact Mr. Tom 
Watson. Crowell & Mooring, 1001 
Pennsylvania Avenue, Washington, DC 
20004, (202) 624-2500. 

L FERC Contact Ed Lee, (202) 357- 
0809. 

j. Comment Date: October 5,1990. 

k. Description of Project The existing 
operating project was issued an initial 
license in 1937 which expired on June 30, 
1987. The licensee has filed for a new 
license for the continued operation of 
the project with no new construction 
proposed. 

The project consists of: (1) Keystone 
Diversion Dam, an earth structure which 
impounds Lake Ogalials; the dam is 
1,298 feet long and 24.4 feet high, with a 
south sluiceway 98 feet long, non- 
overflow section 525 feet long, center 
sluiceway 67 feet long, and an 
emergency spillway (fuse plug) 6C8 feet 
long; the '"west arm'* of the lake is in 
FERC licensed Project No. 1417; (2) a 
supply canal. 32.3 miles long, which 
conveys the water diverted by Keystone 
Diversion Dam to the Sutherland 
Reservoir, (3) Korty Diversion Dam, 

1,244 feet long and 19 feet high with a 
sluiceway 58.5 feet long, concrete ogee 
spillway 435.5 feet long and a fuse plug 
600 feet long; the dam diverts flows of 


the South Platte River into the South 
Supply Cana!; (4) the South Platte 
Supply Canal, about seven miles long; 
the water from the Supply Canal may be 
conveyed for cooling purposes to the 850 
MW steam electric Gerald Gentleman 
Station; (5) Sutherland Reservoir, with 
gross storage capacity of 65,974 acre-feet 
and surface area of 3,050 acres at 
normal maximum surface elevation of 
3055.0 feet m.s.L; the water from the 
Sutherland Reservoir may be conveyed 
for cooling purposes to the 650 MW 
steam electric Gerald Gentleman 
Station; (6) an Outlet Canal, 19 miles 
long, which conveys water bom 
Sutherland Reservoir to Lake Maloney; 

(7) Lake Maloney and Dam, the lake is 
an off channel regulating reservoir with 
gross storage capacity of 21,600 acre-feet 
and surface area of 1.670 acres at 
normal maximum surface elevation of 
3006.0 feet m.s.1.; the dam is an earth 
structure 8,700 feet long and 44 feet high; 

(8) a Power Canal two miles long, which 
conveys water from Lake Maloney 
through a forebay and penstock to the 
North Platte powerhouse; (9) North 
Platte powerhouse, located about two 
miles from North Platte, Nebraska, 
which has two 18,000-HP turbines and 
two generators each rated at 12 MW; 

(10) a tailrace canal, about two miles 
long, which conveys water from the 
North Platte powerhouse to the South 
Platte River; and (11) appurtenant 
facilities. 

l. Purpose of Project Project power 
would continue to be utilized in the 
applicant's power generation system. 

m. This notice also consists of the 
following standard paragraphs: B, C, 
and Dl. 

3 a. Type of Application: Amendment 
of License. 

b. Project No.: 2230-005. 

c. Dote filed: May 16,1990. 

d. Applicant City and Borough of 
Sitka. Alaska. 

e. Name of Project Blue Lake 
Hydroelectric Project. 

f. Location: On Sawmill Creek in the 
Sitka Borough of Alaska. 

g. Filed Pursuant to: Federal Power 
Act, 16 U.S.C. 791(a)-325(r). 

h. Applicant Contact Mr. Greg 
Grissom. Electric Superintendent, City 
and Borough of Sitka, 304 Lake Street 
Sitka, AK 99835, Telephone: (907) 747- 
3294. 

i. FERC Contact Mr. William Roy- 
Harrison. (202) 357-0845. 

j. Comment Date: October 4 , 1990. 

k. Description of Project The license 
for the existing Blue Lake Hydroelectric 
Project would be amended to include 
two additional generating units, a fish 
valve unit and a pulp mill feeder unit. 


The proposed fish valve unit would 
consist of: (1) a 36-inch wye branch 
connected to the existing flange of the 
fish release valve; (2) a 24-inch- 
diameter, 19-foot-long penstock; (3) a 
powerhouse containing a generating unit 
with a rated capacity of 700 kW; (4) a 
12.47-kV, 7,700-foot-long transmission 
line, connecting into the existing Blue 
Lake substation; and (5) appurtenant 
facilities. 

The proposed pulp mill feeder unit 
would consist of: (1 j a 36-inch wye 
branch connected to the existing pulp 
mill feeder pipe; (2) a 24-inch-diameter, 
10-foot-long penstock; (3) a powerhouse 
containing a generating unit with a rated 
capacity of 1,000 kW; (4) a 4.16-kV, 470- 
foot-long buried power cable connecting 
into the existing Blue Lake substation; 
and (5) appurtenant facilities. 

1. This notice also consists of the 
following standard paragraphs: B, C, 
and Dl. 

4 a. Type of Application: Conduit 
Exemption. 

b. Project No.: 2424-001. 

c. Date Filed: April 21,1989. 

d. Applicant Niagara Mohawk Power 
Corporation. 

e. Name of Project Hydraulic Race. 

f. Location: On the New York State 
Barge Canal, in the City of Lockport 
Niagara County, New York. 

g. Filed Pursuant to: Federal Power 
Act, section 30,16 U.S.C. 79Jfa)-825(r). 

h. Applicant Contact Jerry Sabattis, 
300 Erie Boulevard West, Syracuse, NY 
13202, (315) 428-5582. 

i. FERC Contact: Charles T. Raabe 
(tag) (202) 357-0811. 

j. Comment Date: September 24.1990. 

k. Description of Project The existing, 
operating project consists of: (1) a 
concrete-lined, horseshoe-shaped, 140- 
foot-long, 12-foot-wide, 12.5-foot-high 
tunnel; (2) a 100-foot-long, 13-foot- 
diameter steel penstock; (3) a 54-foot- 
long, 46-foot-wide, 50-foot-high steel and 
brick powerhouse containing a 
generating unit rated at 4,687-kW; (4) a 
500-foot-long tailrace; and (5) 
appurtenant facilities. 

The New York State Department of 
Transportation is responsible for the 
operation of Locks 34 and 35 and for 
maintaining operating water levels in 
the downstream section of the canal. 
Control of water release and the 
resulting generation from the project is 
achieved by the Barge Canal Lock 
Operator adjusting die discharge of 
water from the barge canal. 

Although the single adjustable blade 
Kaplan unit has a rated capacity of 
4687-kW at 46 feet head, the maximum 
capability is 3400-kW at a flow of 1080 
cfs due to hydraulic limitations in the 









Federal Register / Vol. 55. No. 171 / Tuesday. September 4, 1990 / Notices 


35939 


conduit system. An average of between 
600 to 800 cfs has been utilized for 
generation in recent years. The project's 
average annual generation is 11,000,000- 
kWh. 

Generation is limited to the navigation 
season which is from approximately 
May 1 to December 1 each year. During 
the non-navigation season, the canal is 
dewatered. Energy produced by the 
project is used by applicant within its 
distribution system. 

1. This notice also consists of the 
following standard paragraphs: B, C, 
and D3b. 

5 a. Type of Application: Surrender of 
License. 

b. Project No.: 2761-027. 

c. Date Filed: July 26.1990. 

d. Applicant: El Dorado Irrigation 
District and El Dorado County Water 
Agency. 

e. Name of Project: Upper Mountain 
Project. 

f. Location: On the South Fork 
American River and its tributaries in El 
Dorado County, California. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact: Christopher D. 
Williams. 2501 M Street, N.W.. 
Washington, DC 20037, (202) 861-1234. 

i. FERC Contact: Mr. William Roy- 
Harrison, (202) 357-0845. 

j. Comment Date: September 27,1990. 

k. Description of Project: The project 
would have consisted of a series of 
dams and diversion structures, with 
reservoirs, tunnels, penstocks, conduits, 
powerhouses (total installed capacity of 
110.4 MW), transmission lines, and 
appurtenant facilities. 

The licensee states that the project is 
not financially feasible to develop at 
this time. Therefore, the licensee 
requested that its license be terminated. 
The licensee has not commenced 
construction of the project. 

l. This notice also consists of the 
following standard paragraphs: B, C, & 
D2. 

6 a. Type of Application: Transfer of 
License. 

b. Project No.: 4017-009. 

c. Date filed: May 9,1990. 

d. Applicant: City of Pittsburgh, 
Pennsylvania (Licensee) Pittsburgh 
Water and Sewer Authority 
(Transferee). 

e. Name of Project: Allegheny River 
Locks and Dam No. 2. 

f. Location: On the Allegheny River in 
Allegheny County, Pennsylvania. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C. 791(a)—825(r). 

h. Applicant Contact: 

Ashley C. Schannauer. Assistant City 
Solicitor, Department of Law, City 


of Pittsburgh, 313 City-County 
Building, Pittsburgh. PA 15219, (412) 
255-2009 

George W. Jacoby, Esquire, Jacoby & 
Cheswick, 1208 Manor Complex, 564 
Forbes Avenue, Pittsburgh, PA 
15219. 

i. FERC Contact: Michael Dees (202) 
357-0807. 

j. Comment Date: September 24,1990. 

k. Description of Project: On May 9. 
1990, the licensee and transferee filed a 
joint application to transfer the license 
for the Allegheny River Lock and Dam 
Project No. 4017. The proposed transfer 
will not result in any change in the 
project. The transferee states that it 
would comply with all terms and 
conditions of the license. The purpose of 
the transfer is to facilitate the financing 
of the project. 

l. This notice also consists of the 
following standard paragraphs: B and C. 

7 a. Type of Application: Transfer of 
License. 

b. Project No.: 4914-006. 

c. Date filed: July 6,1990. 

d. Applicant: Hammermill Paper 
Company. 

e. Name of Project: Nicolet Paper 
Company Dam Project. 

f. Location: On the Fox River, in the 
City of DePere, in Brown County, 
Wisconsin. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact: William J. 
Madden, Jr., Esquire, Bishop, Cook, 
Purcell, and Reynolds, 1400 L. Street, 

NW, Washington, DC 20005-3502, (202) 
371-5700. 

i. FERC Contact: Mary C. Golato (202) 
357-0804. 

j. Comment Date: September 24,1990. 

k. Description of Project: Hammermill 
Paper Company proposes to transfer the 
license for the Nicolet Paper Company 
Dam Project No. 4914 to International 
Paper Company as part of a merger 
between the two parties, which took 
effect on November 10,1986. 

l. This notice also consists of the 
following standard paragraphs: B and C. 

8 a. Type of Application: Surrender of 
License. 

b. Project No.: 8888-007. 

c. Date filed: July 16,1990. 

d. Applicant: Brookfield Power 
Company, Ltd. 

e. Name of Project: Oliverian Brook 
Project. 

f. Location: On Oliverian Brook, in 
Grafton County, New Hampshire. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact: Mr. Richard A. 
Mauser, 760 Governor's Road, 

Brookfield, NH 03872, (603) 522-3427. 


i. FERC Contact: Michael Dees (202) 
357-0807. 

j. Comment Date: September 27,1990. 

k. Description of Project: On July 29. 
1986, a license was issued to construct, 
operate and maintain the Oliverian 
Brook Project No. 8888. The project 
would consist of: (a) a weir-intake 
structure, with a maximum height of four 
feet and a length of 36 feet and utilizing 
2-foot-high drop Dashboards: (b) a 
proposed small reservoir with negligible 
storage capacity at 468 feet m.s.L; (c) 
two 4-foot-diameter steel penstocks 
approximately 300 feet long; (d) a 
powerhouse to contain an installed 
generating capacity of 450 kW; (e) the 
0.48-kV generator leads; (f) the 0.48/ 
12.5-kV, 500-kVA transformer bank; (g) 
a 450-foot-long, 12.5 kV transmission 
line; and (h) appurtenant facilities. The 
deadline to start project construction 
was extended to July 1,1990, on March 
30,1988, and has now expired. 

l. This notice also consists of the 
following standard paragraphs: B, C, 
and D2. 

9 a. Type of Application: License 
Application—Final Amendment. 

b. Project No. 9705-001. 

c. Date filed: December 23,1985, Final 
Amendment filed May 13.1990. 

d. Applicant: Bakers Falls 
Corporation. 

e. Name of Project: Hudson Falls 
Project. 

f. Location: On the Hudson River in 
Saratoga, Washington, and Warren 
Counties, New York. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact: Mr. Sanford L. 
Hartman. Bakers Falls Corporation, 420 
Lexington Avenue, Suite 440, New York. 
NY 10170, (212) 986-0440. 

i. FERC Contact: Robert Bell (202) 
357-0806. 

j. Comment Date: October 12,1990. 

k. Description of Project: The revised 
project would consist of: (1) the existing 
1,660-foot-long concrete gravity dam 
varying in height from 12 feet to 20 feet; 
(2) a reservoir having a surface area of 
220 acres with a storage capacity of 410 
acre-feet and a normal water surface 
elevation of 207 feet msl; (4) a proposed 
intake; (5) the existing Moreau Power 
Canal; (6) a proposed 125-foot-long, 21- 
foot-diameter reinforced concrete power 
intake; (7) a proposed powerhouse 
containing 2 generating units having a 
total installed capacity of 38,600 kW; (8) 
a proposed tailrace; (9) a proposed 
3.500-foot-long, 115 kV transmission line; 
and (10) appurtenant facilities. The 
existing facilities are owned by Niagara 
Mohawk Power Corporation. The 
applicant estimates the average annual 










35310 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


generation would be 20,500,000 kWh. 

The energy generated would be sold to 
Niagara Mohawk Power Corporation. 

I. This notice also consists of the 
following standard paragraphs: B. C, 
and Dl. 

10 a. Type of Application: Exemption 
from Licensing. 

b. Project No.: 10555.001. 

c. Date filed: December 14,1989. 

d. Applicant: Kenneth M. Grover. 

e. Name of Project: Tuck Tape Project.* 

f. Location: On the FishkiJ! Creek in 
Dutchess County, New York. 

g. Filed Pursuant to: Energy Security 
Act of 198a Federal Power Act 10 U.S.C, 
791 (a}-825(r). 

h. Applicant Contact: Kenneth M. 
Grover. P.O. Box 530, Croton Falls 
Executive Park. Croton Palls. NY 10510. 
(914) 277-8000. 

i. FERC Contact: Robert Bell, (202) 
357-0800. 

j. Comment Dote: September 24,1990. 

k. Description of Project: The 
proposed project would consist of: (1) 

.An existing 133-foot-long, 14-fcot-high 
quarried stone and concrete dam; (2) 
installation of 2-foot-high flashboards; 

(3) a reservoir having a surface area 3.5 
acres with negligible storage and a 
normal water surface elevation of 70 
feet msl; (4) an existing intake; (5) an 
existing 18-foot-long, 7-foot-diameter 
penstock; (6) an existing pow erhouse 
containing one new generating unit with 
a rated capacity of 350 kW; (7) the 
existing tailrace; (8) an existing 2.3-kV 
transmission line; and (9) appurtenant 
facilities. The estimated average energy 
generation is estimated to be 1,740,000 
kWh and would be sold to a local utility. 

l. This notice also consists of the 
following standard paragraphs: A3, A9, 
D. C, and D3a. 

11a. Type of Filing: Minor License. 

b. Project Noj 10927-000. 

c. Date Filed: May 2,1990 

d. Applicant Scott D. Hciner. 

e. Name of Project Salt River 
Hydroelectric Power Project. 

f. Location: On the Salt River in 
Lincoln County, Wyoming and 
Bonneville County, Idaho. 

g. Filed Pursuant to: Federal Power 
Act 18 U.S.C. 791 (aj-825(r). 

h. Applicant Contact Scott D. Heiner, 
612 Beech Avenue, Kemmerer, Wyoming 
83101, (207) 276-6248. 

i. Commission Contact. Nanzo T. 
Coley, (202) 357-0840. 

j. Comment Date: November 1,1990. 

k. Description of Project The 
proposed project would consist of: (1) 

An existing 13,800-foot-long, 15-foot-high 
earth-lined inlet canal, which receives 
water directly from the Salt River; (2) an 
existing ,50-foot-long. 3025-foot-wide, 10- 
foot-high concrete inlet headgate; (3) 


two existing 44-foot-long, 5-foot- 
diameter penstocks and one proposed 
44-foot-long, 5-foot-diameter penstock; 
(4) an existing powerhouse containing 
two existing generating units rated at 
300 kW each and one proposed 
generating unit rated at 500 kW; (5) an 
existing 50-foot-long tailrace; (6) a 
proposed 100-foot-long, 2,500 volt 
transmission line; and (7) appurtenant 
facilities. The estimated average annual 
generation for the project is 7,350,000 
kWh. 

l. Purpose of Project Power produced 
at the project will be sold to a local 
utility company. 

m. This notice also consists of the 
following standard paragraphs: A3. A9, 
B, C, and Dl. 

a. Type of Application: Minor License. 

b. Project No.: 10934-000. 

c. Date filed: May 4,1990. 

d. Applicant: William Ruger, Jr. 

e. Name of Project Sugar River II 
Project. 

f. Location: On the Sugar River in 
Sullivan County, New Hampshire. 

g. Filed Pursuant to: Federal Power 
Act 10 U.S.C, 791 (a)-825{r). 

h. Applicant Contact: Mr. William B. 
Ruger. Jr. P.O. Box 293, Newport, NH 
03773, (603) 863-3300. 

i. FERC Contact Robert W. Bell. (202) 
357-0806. 

j Comment Date: October 12,1990. 

k. Description of Project The 
Proposed project would consist of: (1) a 
proposed 42-foot-long, 6-foot-high 
reinforced concrete dam; (2) an 
impoundment having a surface area of 
0.37 acres with negligible storage and a 
water surface elevation of 822 msl; (3) a 
proposed 22-foot-wide rectangular 
intake; (4) a proposed trapezoidal earth 
unlined canal 400 feet long with a 
bottom width of 5 feet and a top width 
of 25 feet; (5) an existing 9-fcot-deep, 20- 
foot-wide and 400-foot-long canal; (6) an 
existing 250-foot-long, 7-foot-diameter 
concrete penstock; (7) an existing 
powerhouse containing 1 generating unit 
with an installed capacity of 200 kW; (8) 
an existing 75-foot-long 4.16-kV 
transmission line: and (9) appurtenant 
facilities. The applicant owns the 
existing facilities. The applicant 
estimates the average annual generation 
would be 650,000 kWh. The energy 
generated by this project would be sold 
to a local utility. The applicant is 
seeking benefits under section 210 of the 
Public Utility Regulatory Policies Act. 

l. This notice also consists of the 
following standard paragraphs: A3, A9. 
B, C, and Dl. 

a. Type of Application: Preliminary 
Permit. 

b. Project Nou 10938-OOa 

c. Date filed: May 21,199a 


d. Applicant: Public Resource 
Development Associates. 

e. Name of Project Grays Landing 
Project. 

f. Location: On the Monongahela 
River in Greene County, Pennsyli'ania. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C 791 (a)-825(r). 

h. Applicant Contact Mr. Donald W. 
McKee. Public Resource Development 
Associates, 217 Scott Drive. 

Monroeville, PA 15146, (404) 659-7319. 

i. FERC Contact Robert Bell. (202) 
357-0806. 

j. Comment Date: October 18,1990. 

k. Description of Project The 
proposed project would utilize the 
proposed U.S. Corps of Engineers Grays 
Landing Dam and impoundment and 
would consist of: 1) a proposed 
headrace channel around the west 
abutment of the spillway; (2) a proposed 
intake structure, (3) a proposed 
powerhouse containing two generating 
units having a total installed capacity of 
6.700 kW; (4) a proposed tailrace 
channel; (5) a proposed transmission 
line; and (8) appurtenant facilities. The 
proposed project would have an average 
annual generation of 34,000,000 kWh. 

The studies would cost $70,000. 

l. Purpose of Project All project 
energy' generated would be sold to a 
local utility. 

m. This notice also consists of the 
following standard paragraphs: A3. A7. 
A9, Am B, C, and D2. 

14a. Type of Application: Preliminary 
Permit. 

b. Project No- 10944-000. 

c. Date filed: June 5,1990. 

d. Applicant: Portland General 
Electric Company. 

e. Name of Project Cripple Creek. 

f. Location: In Mount Hood National 
Forest, on Cripple Creek, in Clackamas 
County, Oregon. Township 6 S Range 6 
E. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C. 791(aJ-025(r). 

h. Applicant Contact: Ms. Peggy Y. 
Fowler, Portland General Electric 
Company, 121 SW Salmon Street, 
Portland. OR 97204. (503) 464-8401. 

i. FERC Contact: Michael Spencer at 
(202) 357-357-0846. 

j. Comment Date: October 19,1990. 

k. Description of Project: The 
proposed project would be an 
amendment to the existing Oak Grove 
Project No. 135 and consist of: (1) a 10- 
foot-high dam; (2) a 24-inch-diameter. 
3,600-foot-long penstock. This would 
enable the Oak Grove project to 
increase its capacity by 3,000 kW and its 
annual generation by approximately 
5,400 MWh. No new access road will be 
needed to conduct the studies. The 




















Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1090 / Notices 


35941 


applicant estimates that the cost of the 
studies to be conducted under the 
preliminary permit would be $200,000. 

l. Purpose of Project: Project pow er 
would be used by the applicant 

m. This notice also consists of the 
following standard paragraphs: A5, A 7, 
A9, AlO. B, C, and D2. 

15a. Type of Application: Preliminary 
Permit. 

b. Project Noj 10946-000. 

c. Date filed: June 7,1990. 

d. Applicant: Weeden's Hydro. 

e. Name of Project: West Cady Creek. 

f. Location: In the Snoqualmie—Mt. 
Baker National Forest on West Cady 
Creek, in Snohomish County, 
Washington. Township 28 N Range 12 E. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C. 791(a)-825(r). 

h. Applioant Contact: Mr. Arthur 
Weeden. 14450 NE 29th Place. Suite 118, 
Bellevue. WA 98007, (206) 881-7826. 

i. FERC Contact: Michael Spencer at 
(202) 357-0846. 

j. Comment Date: October 18,1990. 

k. Description of Project: The 
proposed project would consist of: (1) a 
10-foot-high concrete dam at elevation 
2,380 feet (msl); (2) a 6-foot-diameter. 
3.2-mile-long penstock: (3) a powerhouse 
containing one generating unit with a 
capacity of 10,500 kW an estimated 
average annual generation of 10.5 GWh; 
(4) an 18-mile-long transmission line; 
and (5) a 4 mile-long access road to the 
powerhouse. No new access road will 
be needed to conduct the studies. The 
applicant estimates that the cost of the 
studies to be conducted under the 
preliminary permit would be $200,000. 

l. Purpose of Project Project power 
would be sold. 

m. This notice also consists of the 
following standard paragraphs: A5, A7, 
A9, AlO, B, C. and D2. 

16a. Type of Application: Conduit 
Exemption. 

b. Project No.: 10947-000. 

c. Date filed: June 8,1990. 

d. Applicant: City of Longmont, 
Colorado. 

e. Name of Project: Longmont 
1 lydroelectric Plant. 

f. Location: On the City of Longmont 
water supply system. 

g. Filed Pursuant to: Section 30 of the 
Federal Power Act, 16 U.S.C. 823(a). 

h. Applicant Contact: Mr. Karl F. 
Kunili. ill, Krassa. Lindholm, Kumli 8 
Madsen, 3050 Broadway, Suite 202, 
Boulder, CO 80304, (303) 442-215a 

1. FERC Contact Mr. James Hunter, 
(202) 357-0843. 

j. Comment Date: October 12, 1990. 

k. Description of Project The existing 
project consists of: (1) a connection to a 
30-inch diameter steel water supply 
penstock; (2) a 21-foot-wide, 60-fbot-long 


powerhouse containing two generating 
units rated at 306 ICW and producing an 
average annual output of 4.34 GWH; and 
(3) a concrete trough tailnice leading to 
a 30-inch-diameter water supply 
pipeline. 

L Purpose of Project The plant is used 
for base load power generation. 

m. This notice also consists of the 
following standard paragraphs: B, C, 
and D3b. 

17a. Type of Filing: Preliminary 
Permit 

b. Project No.: 10950-000. 

c. Date filed: June 11,1990. 

d. Applicant Cascade River Hydro. 

e. Name of Project Black Creek 
Project 

L Location: On Blsck Creek in 
Snohomish County, Washington. 

g. Filed Pursuant to: Federal Power 
Act. 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact Bill E. Covin, 
1422-130th Avenue N.E., Bellevue, 
Washington 98005, (206) 455-0234. 

i. Commission Contact: Nanzo T. 
Coley, (202) 357-0840. 

Comment Date: October 15,1990. 

. Description of Project The 
proposed project would be located 
mostly within Mt Baker-Snoquaimie 
National Forest and would consist of: (1) 
a proposed 10 foot-high, 50-foot-long 
diversion dam; (2) a proposed 11,400- 
foot-long, 2-foot-diameter penstock; (3) a 
proposed powerhouse containing one 
generating unit rated 1.9 MW; (4) a 
proposed tailrace: (5) a proposed 21- 
mile-long, 34.5-kV transmission line; 
and (0) appurtenant facilities. The 
estimated average annual energy output 
for the project is 7,900.000 KWh. The 
applicant estimates the cost of the work 
to be performed under the preliminary 
permit at $300,000. 

1. Purpose of Project Power produced 
at the project would be sold to Puget 
Sound Power and Light Company. 

in. 7 his notice also consists of the 
following standard paragraphs: A5, A7. 
A9, AlO. B, C, and D2. 

18a. Type of Application: Preliminary 
Permit. 

b. Project No.: 10952-000. 

c. Date filed: June 13.1990. 

d. Applicant: Nooksack River Hydro. 

e. Name of Project: Clearwater Creek. 

f. Location: On Clearwater Creek, in 
Whatcom County. Washington. 
Township 38 N Range 8 E. 

g. Filed Pursuant to: Federal Power 
Act, 18 U S.C. 791(a)-825(r). 

h. Applicant Contact Bill R. Covin, 
Hydro West Group, Inc., 1422—130th 
Avenue NE, Bellevue, WA. 90005, (200) 
455-0234. 

i. FERC Contact: Michael Spencer at 
(202) 357-0848. 

j. Comment Date: November t, 1990. 


k. Description of Project: The 
proposed project would consist of: (1) a 
15-foot-high concrete danr, (2) a 83-inch- 
diameter, 8,800-fbot-long penstock; (3) a 
powerhouse containing one generating 
unit with a capacity of 8,500 kW and an 
estimated average annual generation of 
25 GWh; (4) a 12-mile-long transmission 
line; and (5) access road9 with a total 
length of 500 feet to service the 
powerhouse and diversion sites. 

No new access road will be needed to 
conduct the studies. The applicant 
estimates that the cost of the studies to 
he conducted under the preliminary 
permit would be $300,000. 

L Purpose of Project: Project power 
would be sold. 

m. This notice also consists of the 
following standard paragraphs: A5, A7, 
A9, AlO. B. C, and D2. 

19a. Type of application: Preliminary 
Permit. 

b. Project No.: 10953-000. 

c. Date filed: June 13,1990. 

d. Applicant Washington Hydro 
Development Company. 

e. Nome of Project Mill Creek. 

f. location: On Mill Creek, in Skagit 
County. Washington. Township 35 N 
Range 7 E. 

g. Filed Pursuant to: Federal Power 
Act, 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact Bill E. Covin, 
Hydro West Group, Inc^, 1422—130th 
Avenue NE., Bellevue, WA. 98005, (206) 
455-0234. 

i. FERC Contact: Michael Spencer at 
(202) 357-0846. 

j. Comment Dote- October 18,1990. 

k. Description of Project: The 
proposed project would consist of: (1) a 
13-foot-high concrete dam; (2) a 30-inch- 
diameter, 8.700-foot-long penstock; (3) a 
powerhouse containing one generating 
unit with a capacity of 4.200 kW and an 
estimated average annual generation of 
15.8 GWh; (4) a 10-mile-long 
transmission Line: and (5) access road3 
with a total length of 2.700 feet to 
service the powerhouse and diversion 
sites. 

No new access road will be needed to 
conduct the studies. The applicant 
estimates that the cost of the studies to 
be conducted under the preliminary 
pei mil would be $300,000. 

l. Purpose of Project: Project power 
would be sold. 

m. This notice also consists of the 
following standard paragraphs: A5, A7, 
A9, AlO, B. C. and D2. 

20a. Type of Application: Preliminary 
Permit. 

b. Project No.: 10956-000. 

c. Date filed: June 13.1990. 

d. Applicant Washington Hydro 
Development Company. 








35942 


Federal Register / Vol, 55, No. 171 / Tuesday. September 4, 1990 / Notices 


e. Name of Project: Park Creek. 

f. Location: In Mount Baker National 
Forest, on Park Creek, in Whatcom 
County, Washington. Township 38 N 
Range 8 E. 

g. Filed Pursuant to: Federal Power 
Act. 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact: Bill E. Covin, 
Hydro West Group, Inc.. 1422-130th 
Avenue NE.. Bellevue, WA 98005, (206) 
455-0234. 

i. FERC Contact: Michael Spencer at 
(202) 357-0846. 

j. Comment Date: October 28,1990. 

k. Description of Project: The 
proposed project would consist of: (1) a 
13-foot-high concrete dam; (2) a 54-inch- 
diameter. 12,000-foot-long penstock; (3) a 
powerhouse containing one generating 
unit with a capacity of 6,500 kW and an 
estimated average annual generation of 
25 GWh; (4) a 9.25-mile-long 
transmission line: and (5) access roads 
with a total length of 10,000 feet to 
service the powerhouse and diversion 
sites. 

No new access road will be needed to 
conduct the studies. The applicant 
estimates that the cost of the studies to 
be conducted under the preliminary 
permit would be $300,000. 

l. Purpose of Project: Project power 
would be sold. 

m. This notice also consists of the 
following standard paragraphs: A5, A7, 
A9, A10, B, C. and D2. 

21a. Type of Application: Preliminary 
Permit. 

b. Project No.: 10959-000. 

c. Date filed: June 18,1990. 

d. Applicant: Clinton Pumped Storage 
Corporation. 

e. Name of Project: Lyon Mountain 
Water Power Project. 

f. Location: On Brandy Brook, in the 
town of Dannemora, in Clinton County, 
New York. 

g. Filed Pursuant to: Federal Power 
Act, 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact: Mr. Ingolf 
Hermann, Independent Hydro 
Developers. 1000 Shelard Parkway— 
Suite 404, Minneapolis, MN 55428. 

i. FERC Contact: Mary C. Galato (tag), 
(202) 357-0804. 

j. Comment Date: October 12,1990. 

k. Description of Project: The 
proposed project would consist of the 
following facilities: (1) a new 9.700-foot- 
long circular embankment forming the 
upper reservoir for the project; (2) an 18- 
inch-diameter, reinforced concrete 
penstock connecting the upper reservoir 
with the underground powerhouse; (3) 
an underground, reinforced concrete 
powerhouse constructed at an 
approximate elevation of 400 feet mean 
sea level and housing two 250-megawatt 
generating units; (4) a lower reservoir 


that would use the existing features of 
the Lyon Mountain iron mine; (5) a 2.5- 
mile-long transmission line 
interconnecting with an existing 230- 
kilovolt transmission facility; and (6) 
appurtenant facilities. The applicant 
estimates the average annual generation 
would be 657 gigawatthours, and that 
the cost of the studies would be 
approximately $850,000. Part of the 
project lands are owned by the town of 
Dannemora. The applicant proposes to 
conduct a geotechnical study to identify 
major formations and geologic features 
within the project boundary. Several 
borings would be located at the 
powerhouse and penstock. However, the 
borings would be located at areas which 
are accessible from existing roadways 
or those which would cause minimal 
environmental disturbance. 

1. This notice also consists of the 
following standard paragraphs: A5, A 7, 
A9, A10, B, C, and D2. 

22a. Type of Application: Preliminary 
Permit. 

b. Project No.: 10963-000. 

c. Date filed: June 22,1990. 

d. Applicant: Portland General 
Electric Company. 

e. Name of Project: South Fork Cripple 
Creek. 

f. Location: In Mount Hood National 
Forest, on South Fork Cripple Creek, in 
Clackamas County, Oregon. Township 5 
S Range 6 E. 

g. Filed Pursuant to: Federal Power 
Act 16 USC 791(a)-825(r). 

h. Applicant Contact Ms. Peggy Y. 
Fowler, Portland General Electric 
Company, 121 SW Salmon Street, 
Portland, OR 97204, (503) 464-8401. 

i. FERC Contact: Michael Spencer at 
(202) 357-0846. 

j. Comment Date: October 18,1990. 

k. Description of Project: The 
proposed project would be an 
amendment to the existing Oak Grove 
Project No. 135 and consist of: (1) an 10- 
foot-high dam; (2) a 15-inch-diameter, 

1.000-foot-long penstock. This would 
enable the Oak Grove project to 
increase its capacity by 600 kW and its 
annual generation by approximately 
1.577 MWh. 

No new access road will be needed to 
conduct the studies. The applicant 
estimates that the cost of the studies to 
be conducted under the preliminary 
permit would be $200,000. 

l. Purpose of Project: Project power 
would be used by the applicant. 

m. This notice also consists of the 
following standard paragraphs: A5, A7. 
A9, A10, B, C. and D2. 

23a. Type of Application: Preliminary 
Permit. 

b. Project No.: 10964-000. 

c. Date filed: June 22.1990. 


d. Applicant: Portland General 
Electric Company. 

e. Name of Project: Bull Creek. 

f. Location: In Mount Hood National 
Forest, on Bull Creek, in Clackamas 
County, Oregon. Township 5 S Range 6 
E. 

g. Filed Pursuant to: Federal Power 
Act 16 USC 791(a)-825(r). 

h. Applicant Contact Ms. Peggy Y. 
Fowler, Portland General Electric 
Company, 121 SW Salmon Street, 
Portland, OR 97204, (503) 464-8401. 

i. FERC Contact: Michael Spencer at 
(202) 357-0846. 

j. Comment Date: October 18,1990. 

k. Description of Project The 
proposed project would be an 
amendment to the existing Oak Grove 
Project No. 135 and consist of: (1) an 5- 
foot-high dam; and (2) a 8-inch-diameter, 
1,000-foot-long penstock. This would 
enable the Oak Grove project to 
increase its capacity by 180 kW and its 
annual generation by approximately 
262.8 MWh. 

No new access road will be needed to 
conduct the studies. The applicant 
estimates that the cost of the studies to 
be conducted under the preliminary 
permit would be $77,000. 

l. Purpose of Project: Project power 
would be used by the applicant. 

m. This notice also consists of the 
following standard paragraphs: A5, A 7, 
A9. A10, B, C, and D2. 

24 a. Type of Application: Preliminary 
Permit. 

b. Project No.: 10966-000. 

c. Date filed: July 3.1990. 

d. Applicant Washington Hydro 
Development Company. 

e. Name of Project: Pressentin Creek. 

f. Location: In Mount Baker National 
Forest, on Pressentin Creek, in Skagit 
County, Washington. Township 35 N 
Range 8 E. 

g. Filed Pursuant to: Federal Power 
Act, 16 U.S.C. 791(a)-825(r). 

h. Applicant Contact: Mr. Bill E. 

Covin, Hydro West Group, Inc., 1422— 
130th Avenue NE, Bellevue, WA 98005, 
(202) 455-0234. 

i. FERC Contact: Michael Spencer at 
(202)357-0846. 

j. Comment Date: October 18,1990. 

k. Description of Project: The 
proposed project would consist of: (1) 
two 10-foot-high concrete dams, one on 
Pressentin Creek and one on an 
unnamed tributary; (2) a 48-inch- 
diameter, 20,000-foot-long penstock; (3) a 
powerhouse containing one generating 
unit with a capacity of 10,300 kW and an 
estimated average annual generation of 
40 GWh; (4) a 12.5-mile-long 
transmission line: (5) a 12,900-foot-long 
access road to service the diversion site; 






Federal Register / Vol. 55. No. 171 / Tuesday, September 4 f 1990 / Notices 


35913 


ami (6) a 200-foot-long tram to service 
the powerhouse. 

No new access road will be needed to 
conduct the studies. The applicant 
estimates that the cost of the studies to 
be conducted under the preliminary 
permit would be $300,000. 

l. Purpose of Project' Project power 
would be sold. 

m. This notice also consists of the 
following standard paragraphs: A5. A7, 
A9, Am B, C. and D2. 

25 a. Type of Application: Conduit 
Exemption. 

b. Project No.: 10973-000. 

c. Date filed: July 16.1990. 

d. Applicant Denver Board of Water 
Commissioners. 

e. Name of Project: Hillcrest 
Hydroelectric Project 

f. Location: On conduit 27 of the 
Hillcrest Reservoir and Pumping station, 
in Denver County, Colorado. 

g. Filed Pursuant to: Section 408 of the 
Energy Security Act of 1980 (16 U.S.C. 
2705 and 2708 as amended). 

h. Applicant Contact: Mr. Jeffrey 
Stevens, Black and Veatch, 1400 South 
Potomac Street, Suite 200, Aurora, CO 
80012, Telephone: (303) 671-4200. 

i. FERC Contact Mr. William Roy- 
Harrison. (202) 357-0845. 

j. Comment Dale: October 18,1990. 

k. Description of Project: The 
proposed project would use the existing 
conduit 27 of the Denver Board of Water 
Commissioners’ domestic water 
distribution system, and would consist 
of a powerhouse containing a generating 
unit with a rated capacity of 2MW. The 
average annual energy generation would 
be 12.300.000 kWh. 

l. This notice also consists of the 
following standard paragraphs: A3. A9, 
B, C, and D3B. 

a. Type of Application: Preliminary 
Permit. 

b. Project No.: 10974-000. 

c. Dote filed: July 23.1990. 

d. Applicant: Southeastern Hydro- 
Power, Inc. 

e. Name of Project: Tar River Hydro 
Project. 

f. Location: On the Tar River in Nash 
County, North Carolina. 

g. Filed Pursuant to: Federal Peer Act 
16 U.S.C. 7 91 (a)-825(r). 

h. Applicant Contact Charles B. 
Mierek. 5250 Clifton-Glendale Road, 
Spartanburg, SC 29302-0211, (803) 579- 
4405. 

i. FERC Contact: Ed Lee (202) 357- 
0809. 

j. Comment Dale: October 18,1990. 

k. Description of Project: The 
proposed project would consist of: (1) 
the existing 860-foot-long and 40-foot- 
high concrete dam; (2) existing 1,400- 
acre reservoir; (3) a proposed intake 


structure; (4) a new concrete 
powerhouse housing a single generating 
unit for a total installed capcity of 1,900 
kw; (5) a proposed tailrace; (6) a new 
17.4-kV or equivalent transmission line; 
and (7) appurtenant facilities. The 
Applicant estimates that the average 
annual generation would be 7.5 GWh. 
The site is owned by the City of Rocky 
Mount, North Carolina. The Applicant 
proposes that all power generated will 
be sold to a local utility company. 

Applicant estimates that the cost of 
the work to be performed under the 
terms of the permit would be $75,000. 

1. This notice also consists of the 
following standard paragraphs: A5, A7. 
A9, A10. B, C. and D2. 

a. Type of Application: Preliminary 
Permit. 

b. Project No.: 10976-000. 

c. Date Filed: July 26,1990. 

d. Applicant Alleghany County, 
Virginia. 

e. Name of Project Gathright Hydro 
Project. 

f. Location: On the Jackson River in 
Alleghany, County, Virginia. 

g. Filed Pursuant to: Federal Power 
Act 16 U.S.C. 791 (a)-825(r). 

h. Applicant Contact Macon C. 
Sammons, Jr., County Administrator, 
P.O Box 917, Covington, VA 24426. (703) 
692-4918. 

i. FERC Contact Ed Lee (lag) (202) 
357-0809. 

j. Comment Dale: September 27,1990. 

k. Competing Application: Project no. 
10920-000. Date Filed: April 2,1990 
Notice Comment Date; June 27,1990. 

l. Description of Project: The 
applicant proposes to utilize an existing 
dam under the jurisdiction of the U.S. 
Army Corps of Engineers. The proposed 
project would consist of: (1) an intake 
tower: (2) a powerhouse containing two 
2-MW generating units for an mstailed 
capacity of 4 MW; (3) a 8,450-foot-long, 
46-kV transmission line; and (4J 
appurtenant facilities. Applicant 
estimates that the cost of the work to be 
performed under the terms of the permit 
would he $100,000 and that the project 
average annual energy output would be 
19.5 GWh. Energy produced at the 
project would be sold to B.A.R.C 
Electric Cooperative or another local 
utility company. 

m. This notice also consists of the 
following standard paragraphs: A8, A9, 
A10, B, C, and D2. 

28 a. Type of Application: Preliminary 
Permit 

b. Project No.: 10978-000. 

c. Dote Filed: July 27,1990. 

d. Applicant North Unit Irrigation 
District. 

e. Name of Project Wickiup Power 
Project. 


f. Location: At the existing Bureau of 
Reclamation Wickiup Dam and 
Reservoir on the Deschutes River near 
Bend in Deschutes County, Oregon. 

g. Filed Pursuant to: Federal Power 
Act 18 U.S.C. 791(a}-825(r). 

h. Contact Person: Mr. Harold V. 
Schonneker, 2024 NW Beach Street, 
Madras. OR 97741, (503) 475-3625. 

1. FERC Contact Ms. Julie Bemt, (202) 
357-0839. 

j. Comment Date: October 26,1990. 

k. Description of Project The 
proposed project would consist of; (1) a 
96-inch-diameter. 79-foot-long steel 
penstock and a 96-inch-diameter. 67- 
foot-long steel penstock connected to 
existing outlet works and converging 
into a single 120-inch-diameter, 21-foot- 
long penstock; (2) a powerhouse 
containing one generating unit with a 
rated capacity of 7,000 kW; (3) a 38-foot 
wide concrete tailrace; and (4) a 9.1- 
mile-long transmission line. The 
applicant estimates the average annual 
energy production to be 26.1 GWh and 
the cost of the work to be performed 
under the preliminary permit to be 
$30,(XX). 

l. Purpose of Project The power 
produced would be sold to a local power 
company. 

ra. This notice also consists of the 
following paragraphs: A5, A7, A9, A10, 

B, C and D2. 

Standard Paragraphs 

A3. Development Application—Any 
qualified development applicant 
desiring to file a competing application 
must submit to the Commission, on or 
before the specified comment date for 
the particular application, a competing 
development application, or a notice of 
intent to file such an application. 
Submission of a timely notice of intent 
allows an interested person to file the 
competing development application no 
later than 120 days after the specified 
comment date for the particular 
application. Applications for preliminary 
permits will not be accepted in response 
to this notice. 

A5. Preliminary Permit—Anyone 
desiring to file a competing application 
for preliminary permit for a proposed 
project must submit the competing 
application itself, or a notice of intent to 
file such an application, to the 
Commission on or before the specified 
comment date for the particular 
application (see 18 CFR 4.36). 

Submission of a timely notice of intent 
allows an interested person to file the 
competing preliminary permit 
application no later than 30 days after 
the specified comment date for the 
particular application. A competing 











35944 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


preliminary permit application must 
conform with 18 CFR 4.30(b)(1) and (9) 
and 4.36. 

A7. Preliminary Permit—Any qualified 
development applicant desiring to file a 
competing development application 
must submit to the Commission, on or 
before the specified comment date for 
the particular application, either a 
competing development application or a 
notice of intent to file such an 
application. Submission of a timely 
notice of intent to file a development 
application allows an interested person 
to file the competing application no later 
than 120 days after the specified 
comment date for the particular 
application. A competing license 
application must conform with 18 CFR 
4.30(b)(1) and (9) and 4.36. 

A8. Preliminary Permit—Public notice 
of the filing of the initial preliminary 
permit application, which has already 
been given, established the due date for 
filing competing preliminary permit and 
development applications or notices of 
intent. Any competing preliminary 
permit or development application or 
notice of intent to file a competing 
preliminary permit or development 
application must be filed in response to 
and in compliance with the public notice 
of the initial preliminary permit 
application. No competing applications 
or notices of intent to file competing 
applications may be filed in response to 
this notice. A competing license 
application must conform with 18 CFR 
4.30(b)(1) and (9) and 4.36. 

A9. Notice of intent—A notice of 
intent must specify the exact name, 
business address, and telephone number 
of the prospective applicant, include an 
unequivocal statement of intent to 
submit, if such an application may be 
filed, either (1) a preliminary permit 
application or (2) a development 
application (specify which type of 
application), and be served on the 
applicant(s) named in this public notice. 

A10. Proposed Scope of Studies under 
Permit—A preliminary permit, if issued, 
does not authorize construction. The 
term of the proposed preliminary permit 
would be 36 months. The work proposed 
under the preliminary permit would 
include economic analysis, preparation 
of preliminary engineering plans, and a 
study of environmental impacts. Based 
on the results of these studies, the 
Applicant would decide whether to 
proceed with the preparation of a 
development application to construct 
and operate the project. 

B. Comments, Protests, or Motions to 
Intervene—Anyone may submit 
comments, a protest, or a motion to 
intervene in accordance with the 
requirements of the Rules of Practice 


and Procedure, 18 CFR 385.210, .211, 

.214. In determining the appropriate 
action to take, the Commission will 
consider all protests or other comments 
filed, but only those who file a motion to 
intervene in accordance with the 
Commission's Rules may become a 
party to the proceeding. Any comments, 
protests, or motions to intervene must 
be received on or before the specified 
comment date for the particular 
application. 

C. Filing and Service of Responsive 
Documents—Any filings must bear in all 
capital letters the title "COMMENTS”. 
"NOTICE OF INTENT TO FILE 
COMPETING APPLICATION”, 
"COMPETING APPLICATION”, 
"PROTEST”. "MOTION TO 
INTERVENE", as applicable, and the 
Project Number of die particular 
application to which the filing refers. 
Any of the above-named documents 
must be filed by providing the original 
and the number of copies provided by 
the Commission’s regulations to: The 
Secretary. Federal Energy Regulatory 
Commission, 825 North Capitol Street, 
N.E., Washington, D.C. 20426. An 
additional copy must be sent to Dean 
Shumway, Director. Division of Project 
Review, Federal Energy Regulatory 
Commission. Room 1027 (810 1st), at the 
above-mentioned address. A copy of 
any notice of intent, competing 
application or motion to intervene must 
also be served upon each representative 
of the Applicant specified in the 
particular application. 

Dl. Agency Comments—States, 
agencies established pursuant to federal 
law that have the authority to prepare a 
comprehensive plan for improving, 
developing, and conserving a waterway 
affected by the project, federal and state 
agencies exercising administration over 
fish and wildlife, flood control, 
navigation, irrigation, recreation, 
cultural or other relevant resources of 
the state in which the project is located, 
and affected Indian tribes are requested 
to provide comments and 
recommendations for terms and 
conditions pursuant to the Federal 
Power Act as amended by the Electric 
Consumers Protection Act of 1986, the 
Fish and Wildlife Coordination Act, the 
Endangered Species Act, the National 
Historic Preservation Act, the Historical 
and Archeological Preservation Act, the 
National Environmental Policy Act, Pub. 
L. No. 88-29, and other applicable 
statutes. Recommended terms and 
conditions must be based on supporting 
technical data filed with the 
Commission along with the 
recommendations, in order to comply 
with the requirement in section 313(b) of 
the Federal Power Act, 16 U.S.C. Section 


8251(b), that Commission findings as to 
facts must be supported by substantial 
evidence. 

All other federal, state, and local 
agencies that receive this notice through 
direct mailing from the Commission are 
requested to provide comments pursuant 
to the statutes listed above. No other 
formal requests will be made. Responses 
should be confined to substantive issues 
relevant to the issuance of a license. A 
copy of the application may be obtained 
directly from the applicant. If an agency 
does not respond to the Commission 
within the time set for filing, it will be 
presumed to have no comments. One 
copy of an agency's response must also 
be sent to the Applicant’s 
representatives. 

D2. Agency Comments—Federal, 
state, and local agencies are invited to 
file comments on the described 
application. A copy of the application 
may be obtain by agencies directly from 
the Applicant. If an agency does not file 
comments within the time specified for 
filing comments, it will be presumed to 
have no comments. One copy of an 
agency’s comments must also be sent to 
the Applicant’s representatives. 

D3a. Agency Comments—The U.S. 

Fish and Wildlife Service, the National 
Marine Fisheries Service, and the State 
Fish and Game agency(ies) are required, 
for the purposes set forth in section 408 
of the Energy Security Act of 1980, to file 
within 60 days from the date of issuance 
of this notice appropriate terms and 
conditions to protect any fish and 
wildlife resources or to otherwise carry 
out the provisions of the Fish and 
Wildlife Coordination Act. General 
comments concerning the project and its 
resources are requested; however, 
specific terms and conditions to be 
included as a condition of exemption 
must be clearly identified in the agency 
letter. If an agency does not file terms 
and conditions within this time period, 
that agency will be presumed to have 
none. Other Federal, state and local 
agencies are requested to provide any 
comments they may have in accordance 
with their duties and responsibilities. No 
other formal requests for comments will 
be made. Comments should be confined 
to subtantive issues relevant to the 
granting of an exemption. If an agency 
does not file comments within 60 days 
from the date of issuance of this notice, 
it will be presumed to have no 
comments. One copy of an agency’s 
comments must also be sent to the 
Applicant’s representatives. 

D3b. Agency Comments—The 
Commission requests that the U.S. Fish 
and Wildlife Service, the National 
Marine Fisheries Service, and the State 















Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35943 


Fish and Game agency (ies), for the 
purposes set forth in section 408 of the 
Energy Security Act of 1980, File within 
45 days from the date of issuance of this 
notice appropriate terms and conditions 
to protect any fish and wildlife 
resources or to otherwise carry out the 
provisions of the Fish and Wildlife 
Coordination Act. General comments 
concerning the project and its resources 
are requested; however, specific terms 

i.nd conditions to be included as a 
condition of exemption must be clearly 
identified in the agency letter. If an 
agency does not file terms and 
conditions within this time period, that 
agency will be presumed to have none. 
Other Federal, state and local agencies 
are requested to provide any comments 
they may have in accordance with their 
duties and responsibilities. No other 
formal requests for comments will be 
made. Comments should be confined to 
substantive issues relevant to the 
granting of an exemption. If an agency 
does not file comments within 45 days 
from the date of issuance of this notice, 
it will be presumed to have no 
comments. One copy of an agency’s 
comments must also be sent to the 
Applicant’s representatives. 

Dated; August 28,1990, Washington. DC. 
Lois D. Cashel!, 

Secretary. 

|FR Doc. 90-20682 Filed 8-31-60; 8.45 am) 

B'LUNQ CODE 6717-01-M 


1 Docket Nos. CP90-2002-019, et at) 

Northwest Pipeline Corporation, et ai. f 
Natural Gas Certificate Filings 

Take notice that the following filings 
have been made with the Commission: 

1 . Northwest Pipeline Corp. 

(Docket No. CP9O-2019-000j 
August 24. 1990. 

Take notice that on August 20.1990, 
Northwest Pipeline Corporation 
(Northwest), 295 Chipeta Way, Salt Lake 
City. Utah 84108, filed in Docket No. 
CI'SO^Ol9-000 a request pursuant to 
§ 157.205 of the Commission’s 
Regulations under the Natural Gas Act 
(18 CFR 157.205) for authorization to 
construct and operate a new delivery' 
meter, to be named the Columbia 
Aluminum Meter, in Klickitat County. 
Washington for the delivery' of 
transportation gas to the Columbia 
Aluminum Corporation (Columbia 
Aluminum) under Northwest’s blanket 
certificate issued in Docket No. CP82- 
433-000 pursuant to section 7 of the 
Natural Gas Act. all as more fully set 
forth in the request which is on file with 


the Commission and open to public 
inspection. 

Northwest slates that Columbia 
Aluminum presently purchases natural 
gas on the spot-market and arranges for 
Northwest and Northwest Natural Gas 
Company (Northwest Natural), a local 
distribution company, to provide 
transportation service to its plant. 
Northwest transports and delivers gas to 
Northwest Natural at the John Day Dam 
Meter Station in Klickitat County, 
Washington. Northwest Natural then 
transports the gas through a 5.3 mile 
segment of its distribution pipeline from 
the meter station to Columbia 
Aluminum's plant. 

Northwest further states that 
Columbia Aluminum has requested a 
direct delivery connection from 
Northwest which would be located 
adjacent to Northwest’s existing John 
Day Dam Meter Station in Klickitat 
County. Washington capable of 
delivering up to 300,000 MMBtus 
annually to pipeline facilities to be 
constructed by Columbia Aluminum as 
part of its nonjurisdictional plant 
facilities. Northwest asserts that this 
requested new delivery meter would 
provide Columbia Aluminum with an 
economic alternative to the 
transportation service currently 
provided by Northw est Natural. 
Columbia Aluminum would save 
approximately $320,000 annually in 
transportation charges by Northwest 
Natural, it is stated. 

Northwest estimates initial snnual 
and peak day volumes to be 197.000 
MMBtu and 750 MMBtu, respectively. 

Comment date: October 9,1990, in 
accordance with Standard Paragraph G 
at the end of this notice. 

2 . Southern Natural Gas Co. 

| Docket No. CP90-20HMX)0| 

August 23.1990. 

Take notice that on August 17,1990, 
Southern Natural Gas Company 
(Southern), P.O. Box 2563, Birmingham, 
Alabama 35202-2563, filed in Docket No. 
CP90-2010-000 a request pursuant to 
5 157.205 of the Commission s 
Regulations under the Natural Gas Act 
(18 CFR 157.205) for authorization to 
construct, install and operate pressure 
legulators and appurtenant facilities and 
reduce the delivery pressure at an 
existing delivery point for an existing 
customer under Southern’s blanket 
certificates issued in Docket No. CPB2- 
40G-000 pursuant to section 7 of the 
Natural Gas Act, all as more fully set 
forth in the request which is on file wdth 
the Gimmission and open to public 
inspection. 

Southern states that it provides 
natural gas service to the City of 


Ciaxton, Georgia (Claxton) at the 
delivery point located near Mile Post 
59.106 on Southern’s Savannah Lateral 
Line in Georgia Military District 9, 
Effingham County. Georgia. Southern 
states further that due to numerous 
operational problems, Claxton has 
requested that Southern construct, at the 
delivery point, replacement facilities 
consisting of pressure regulators and 
appurtenant equipment on Southern’s 
existing meter site. 

Additionally, Southern slates that 
Claxton has requested that Southern 
decrease the contract delivery pressure 
from mainline pressure to 300 psig 
contract delivery pressure as specified 
in Exhibit A to the Service Agreement. 
This decrease in pressure, it is said, 
would not result in any change in 
Claxton’s contract demand and is 
permitted by section 3 of the General 
Terms and Conditions contained in 
Southern’s FERC Gas Tariff, Sixth 
Revised Volume No. 1. 

Southern states the construction of 
new facilities and revision of the 
delivery pressure would improve 
operational efficiency and would 
enhance Claxton’s ability to provide 
reliable service. 

Comment date: October 9,1990, in 
accordance with Standard Paragraph G 
at the end of this notice. 

3 . Florida Gas Transmission Co. 

(Docket No. CP90-2027-000] 

August 24,1990. 

Take notice that on August 21,1990, 
Florida Gas Transmission Company 
(FGT), 1400 Smith Street, P.O. Box 1188, 
Houston, Texas 77251-1188, filed in 
Docket No. CP90-2027-000 a prior notice 
request pursuant to § § 157.205 and 
157.216 of the Commission's Regulations 
under the Natural Gas Act for 
authorization to abandon certain sales 
facilities previously used to provide 
natural gas service to White Packing 
Company (White Packing), an end-user, 
under its blanket certificate issued in 
Docket No. CP82-553-000 pursuant to 
section 7 of the Natural Gas Act, all as 
more fully set forth in the request that is 
on file with the Commission and open to 
public inspection. 

FGT proposes to abandon by sale to 
West Florida Natural Gas Company 
(West Florida) approximately 0.6 mile of 
6 inch and 420 feet of 2-inch lateral and 
to abandon the related White Packing 
meter station and appurtenant facilities. 
The facilities are located in Marion 
County, Florida. FGT states that White 
Packing has moved from the property. 

FGT states that the laterals would be 
sold to West Florida for future use. and 
the remaining reusable facilities would 










35946 


Federal Register / Vol. 55, No. 171 / Tuesday. September 4. 1990 / Notices 


be returned to inventory. FCT states 
that the proposal would not result in any 
abandonment of service to any of FGTs 
existing customers. 

Comment date: October 9.1990, in 
accordance with Standard Paragraph C 
at the end of this notice. 

4. Texas Eastern Transmission Co. 

| Docket No. CP90-2018~O0O| 

August 24,1990. 

Take notice that on August 20. 1990. 
Texas Eastern Transmission 
Corporation (Texas Eastern). Post Office 
Box 2521. Houston, Texas 77252-2521. 
Bled in Docket No. CP90-2018-000 a 
request pursuant to §§157.205 and 
284.223 of the Commission's Regulations 
under the Natural Gas Act (18 CFR 
157.205) and the Natural Gas Policy Act 
(18 CkTt 284 223) for authorization to 
transport natural gas for FEC Marketing, 
Inc. (FEC)* a broker of natural gas. under 
Texas Eastern’s blanket certificate 
issued in Docket No. Cl’aa-l 36-000. as 
amended in Docket No. CP88~136~007, 
pursuant to section 7. of the Natural Gas 
Act. all as more fully set forth in the 
request which is on file with the 
Commission and open to public 
inspection. 


Texas Eastern proposes to transport 
up to 200,000 MMBtu of natural gas 
equivalent per day on an interruptible 
basis on behalf of FEC pursuant to a 
transportation agreement dated April 23. 
1990. between Texas Eastern and FEC. 
Texas Eastern would receive the gas at 
existing receipt points on its system and 
deliver equivalent volumes, less 
applicable shrinkage, at existing 
delivery points on its systems in 
Louisiana, Illinois, Tennessee, 
Pennsylvania, Indiana and New York. 

Texas Eastern states that the 
estimated daily and annual quantities 
would be 200.000 MMBtu and 73.000.000 
MMBtu, respectively. Service under 
§ 284.223(a) commenced on |une 14. 

1990. as reported in Docket No. ST90- 
3796-000, it is stated. 

Comment date: October 9. 1990* in 
accordance with Standard Paragraph G 
at the end of this notice. 


5. Equi trails. Inc., and Midwestern Gas 
Transmission Co. 

[Docket Nos. CT90-2015-000, CP9O-2016-000 
and CP90-2017-000] 

August 24. 1990 


Take notice that on August 20,1990, 
the above listed companies filed in the 
respective dockets prior notice requests 
pursuant to §§157.205 and 284.223 of the 
Commission’s Regulations under the 
Natural Gas Act for authorization to 
transport natural gas on behalf of 
various shippers under their blanket 
certificates issued pursuant to section 7 
of the Natural Gas Act. all as more fully 
set forth in the prior notice requests 
which are on file with the Commission 
and open to public inspection. 1 

A summary of each transportation 
service which includes the shippers 
identity, the peak day. average day and 
annual volumes, the receipt point(s), the 
delivery point(s). the applicable rate 
schedule, and the docket number and 
service commencement date of the 120- 
day automatic authorization under 
§ 284.223 of the Commission’s 
Regulations is provided in the attached 
appendix. 

Comment date: October 9. 1990. in 
accordance with Standard Paragraph G 
at the end of this notice. 

1 These prior nolice requests ure not 

consolidated 


Docket No (date 

Applicant 

Sripper name 

1 

Peak day 1 
average 
annuel 

Points Of 

Start up date, rate 
schedule 

Related dockets > 

tiled) 

Receipt 

Delivery 

CP90 2015-000 
(6 20-90) 

Eqmtrans Inc 

Virginia Electnc 

& Power 
Company 

19,882 
19,88 2 
3.657.500 

PA __ 

PA .. 

7-19-90, FTS .. 

CP86-553-000, 
ST90-4244-000 

CP90-2016-000 

Midwestern Gas 

Uncorp Energy. 

100,000Dt 

Off-Shore LA 6 TX. 

IN. IL. TN. PA, TX. 

7-2-90. IT_ 

CP90-174-000. 

(8-20-90) 

Transmission 

Company 

Inc 

100.000D1 

35.500.00001 

LA. TX. MA. NY. 
NJ. MS, PA. WV. 
TN, CT. NH Rf. 

AL, KY.OH 

LA MS. CT. AL. 
Aft. Ml, Wl. IA. 

MA. OK. WV 

ST90-4150-000 

CP 90- 20 \ 7-000 
(8-20-90) 

Midwestern Gas 
Transmission 
Company 

Fnirade 

Corporation 

150.0CODt 

150,00001 

54.750.00001 

TN. IL IN. PA. 

IL IN. MS. PA. KY 
LA. OH. MA KY. 

TN 

7-1-90. IT . 

CP90-174-000. 
ST90-4125-000 


‘ Quantities vo shown m MMBtu unless otherwise indicated. 

foe CP docket corresponds to applicant's blanket transportation certificate H an ST docket « shown, 120-day transportation service was reported in it 


6. Northern Natural Gas Co. and 
Colorado Interstate Gas Ca 

(Docket Nos. 0*90-2031-000. CP90-20.l2-axi 
and CP90-2033-000| 

August 24. 1990. 

Take notice that Applicants filed in 
the respective dockets prior notice 
requests pursuant to §§ 157.205 and 
284.223 of the Commission’s Regulations 
under the Natural Gas Act for 
authorization to transport natural gas on 
behalf of various shippers under the 
blanket certificates issued pursuant to 
section 7 of the Natural Gas Act* all as 
more fully set forth in the requests that 


are on file with the Commission arid 
open to public inspection. 1 

Information applicable to each 
transaction, including the identity of the 
shipper, the type of transportation 
service, the appropriate transportation 
rate schedule, the peak day. average day 
and annua) volumes, and the initiation 
service dates and related docket 
numbers of the 120-day transactions 
under Section 284.223 of the 
Commission’s Regulations, has been 
provided by Applicant and is 


* THexe prior nutica request* are not 
consolidated 


summarized in the attached appendix. 

Applicant states that each of the 
proposed sendees would be provided 
under an executed transportation 
agreement, and that Applicant would 
charge the rates and abide by the terms 
and conditions of the referenced 
transportation rate schedules. 

Comment date: October 9. 1990, in 
accordance with Standard Paragraph G 
at the end of this notice. 

Applicant: Northern Natuial Gas 
Company, 1400 Smith Street. P.O. Box 
1188. Houston. TX 77251-138. 

Blanket Certificate Issued in Docket 
No. CP86-435-000. 




























Federal Register / Vol. 55. No. 171 / Tuesday. September 4, 1990 / Notices 


35947 


Docket No. (date filed) 

Shipper name 

Peak day 1 
avg. annual 

Po*nt8 of 

Start up date rate 

Related * dockets 

Receipt 

Delivery 

schedule 

CP90-2C31-000 (8-22- 
90) 

CP90-2032-000 (8-22- 
90) 

Panda Inr 

500,0C0 
375.000 
182,500.000 
20,000 
15.000 
7,300.000 

various —.. 

Offshore TX .... 


various. 

7-C3-90 IT-1. 

ST90-3940-000. 

Eron Gas Marketing, Inc... 

— 

TX_....... 

8-01-90 FT-1- 

ST90-4243-000. 


1 Quantities are 9 hown in MM3tu unless otherwise Indicated. 

* If an ST docket is shown, 120-day transportation service was reported in it 


Applicant: Colorado Interstate Gas Blanket Certificate Issued in Docket 

Company, Post Office Box 1087, No. CP66-589-OnO. 

Colorado Springs, CO 80944. 


Docket No. (date Tiled) 

Shipper name 

Peak day * 
avg annual 

Points of 

Start up date rate 
schedule 

D a/ 4 3 r»L 

Receipt 

Delivery 

nSioiGu OOCwGiS 

CP90-2033-000 (8-22- 

90) 

Grand Valley Gas Compa¬ 
ny. 

10.000 

5.000 

1,750.000 

WY... 

WY..1— 

5-25-90 Tt-1 .. 

ST90-3285-000. 


• Quantities are shown in Mcf unless otherwise indicated. 


7. Texas Gas Transmission Corp. 

[Docket No. CP90-2025-000] 

August 24.1990. 

Take notice that Texas Gas 
Transmission Corporation, 3800 
Frederica Street, Owensboro, Kentucky 
42301, (Applicant) filed in the above- 
referenced docket a prior notice request 
pursuant to 55 157.205 and 284.223 of the 
Commission's Regulations under the 
Natural Gas Act for authorization to 


transport natural gas on behalf of a 
shipper under its blanket certificate 
issued in Docket No. CP88-686-000, 
pursuant to section 7 of the Natural Gas 
Act, ail as more fully set forth in the 
requests that are on file with the 
Commission and open to public 
inspection. 

Information applicable to each 
transaction, including the identity of the 
shipper, the type of transportation 
service, the appropriate transportation 


rate schedule, the peak day, average day 
and annual volumes, and the initiation 
service dates and related ST docket 
numbers of the 120-day transactions 
under 5 284.223 of the Commission’s 
Regulations, has been provided by 
Applicant and is summarized in the 
attached appendix. 

Comment date: October 9,1990, in 
accordance with Standard Paragaph G 
at the end of this notice. 


Docket No. (date filed) 

Shipper name 

Peak day 
average 
day 
annual 
MMBtu 

Receipt points 

Delivery points 

Contract date rate 
schedule service type 

Related docket, start up 
date 

C POO-2025-000 (8-21- 
90) 

Direct Gas Supply 
Corporation. 

25.000 

1,000 

365,000 

Vannus ,,,, . 

Various.. 

IT Interruptible 

ST90-4181 7-26-90 





E Panhandle Eastern Pipe Line Co. 

[Docket No. CP90-1978-000j 
August 24.1990. 

Take notice that on August 14,1990, 
Panhandle Eastern Pipe Line Company 
(Panhandle), P.O. Box 1642, Houston, 
Texas 77001. filed in Docket No. CP90- 
1978-000 an application pursuant to 
section 7(b) of the Natural Gas Act for 
permission and approval to abandon 
certain pipeline facilities located in 
Wyoming, all as more fully set forth in 
the application which is on file with the 
Commission and open to public 
inspection. 

Panhandle states that it seeks to 
abandon and transfer ownership to 
Phillips 66 Natural Gas Company 


(Phillips) Panhandle’s Powder River 
System located in Campbell, Converse, 
West on, and Johnson Counties, 
Wyoming, including: (1) 30 compressor 
station sites with a total of 
approximately 31,559 compressor 
horsepower. (2) approximately 369 miles 
of pipeline and appurtenant facilities, 
operating and maintenance equipment, 
spare parts and inventory. All facilities 
abandoned by Panhandle will remain in 
place for the continued use by Phillips, it 
is stated. 

Panhandle asserts that it would 
significantly reduce its operating costs 
without detriment to its sales customers 
by transferring ownership of the Powder 
Fiver System to Phillips. Panhandle 
avers that the proposed transfer of 


ownership would result in cost-of- 
8 ervice savings of $4,000,000. Panhandle 
states that it would retain its ability to 
purchase gas at the tailgate of the 
Douglas Plant to meet its customer’s 
future needs if required. 

Comment dote: September 14,1990. in 
accordance with Standard Paragraph F 
at the end of this notice. 

9. Natural Gas Pipeline Co. of America 

[Docket Nos. CP90-2037-000, CP90-2038-000, 
CP90-2039-000 and CP90-2040-000) 

August 24.1990. 

Take notice that on August 23,1990, 
Natural Gas Pipeline Company of 
America, 701 East 22nd Street. Lombard, 
Illinois 60148, (Natural), filed in the 
above-referenced dockets prior notice 














































35948 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


requests pursuant to §5157.205 and 
284.223 of the Commission's Regulations 
under the Natural Gas Act for 
authorization to transport natural gas on 
behalf of various shippers under its 
blanket certificate issued in Docket No. 
CP86-582-000. pursuant to section 7 of 
the Natural Gas Act, all as more fully 
set forth in the requests that are on file 


with the Commission and open to public 
inspection. 3 

Information applicable to each 
transaction, including the identity of the 
shipper, the type of transportation 
service, the appropriate transportation 
rate schedule, the peak day, average day 
and annual volumes, and the initiation 


* These prior notice requests are not 
consolidated. 


service dates and related ST docket 
numbers of the 120-day transactions 
under 5 284.223 of the Commission’s 
Regulations, has been provided by 
Natural and is summarized in the 
attached appendix. 

Comment date: October 9,1990, in 
accordance with Standard Paragraph G 
at the end of the notice. 


Docket No. (dated filed) 

Shipper name (type) 

Peak day 
average day 
annual 
MMBtu 

Receipt points 

Delivery points 

Contract dale rate 
schedule service 
type 

Related docket, 
start up date 

CP90-2037-000 (8-23- 
90) 

Caterpillar Inc. (End- 
user). 

8.000 

8,000 

2.920,000 

LA. IL.TX.- .. 

IL, TX~ 

5-17-90 FTS Firm... 

ST90-4031-000 7- 
1-90 

CP90-2038-000 (8-23- 
90) 

International Paper 
Company (End-user). 

5,000 

5,000 

1.825,000 

LA. TX__ 

AR ... 

5-16-90 FTS Firm... 

ST90-4117-000 7- 
1-90 

CP90-2039-000 (8-23- 

Hadson Gas Systems, 

Inc (Marketer). 

50,000 

30,000 

10,950,000 

Various.. 

Various.„. 

6-22-90 ITS 

ST90-4121-000 7- 

90) 



Interruptible. 

1-90 

CP90-2040-000 (8-23- 

Vtctona Gas 

20.000 

TX, OK, LA. 

LA, IL, TX, IA_ 

10-17-89 ITS 

ST90-4048-000 6- 

90) 

Corporation 

(Marketer) 

10,000 

3,650,000 



Interruptible. 

29-90 


10 . Southern Natural Gas Co. 
Transcontinental Gas Pipe Line Corp. 
Southern Natural Gas Co. and Colorado 
Interstate Gas Co. 

(Docket Nos. CP90-2012-000, CP90-2014-000, 
CP90-2020-000 and CP90-2021-000) 

August 24. 1990. 

Take notice that Southern Natural 
Gas Company, PO. Box 2563, 
Birmingham. Alabama 35202-2563. 
Transcontinental Gas Pipe Line 
Corporation, P.O. Box 1396. Houston. 
Texas 77251, and Colorado Interstate 
Gas Company, P.O. Box 1087, Colorado 
Springs, Colorado 80944 (Applicants), 


filed in the above-referenced dockets 
prior notice requests pursuant to 
5 § 157.205 and 284.223 of the 
Commission’s Regulations under the 
Natural Gas Act for authorization to 
transport natural gas on behalf of 
various shippers under the blanket 
certificates issued in Docket No. CP88- 
316-000 and Docket No. CP88-328-000, 
respectively, pursuant to section 7 of the 
Natural Gas Act, all a3 more fully set 
forth in the requests that are on file with 
the Commission and open to public 
inspection. 4 

4 The®# prior notice request® are not 

consolidated. 


Information applicable to each 
transaction, including the identity of the 
shipper, the type of transportation 
service, the appropriate transportation 
rate schedule, the peak day, average day 
and annual volumes, and the initiation 
service dates and related ST docket 
numbers of the 120-day transactions 
under 3 284.223 of the Commission's 
Regulations, has been provided by 
Applicants and is summarized in the 
attached appendix. 

Comment date: October 9,1990, in 
accordance with Standard Paragraph G 
at the end of this notice. 


Docket No. (date filed) 

SI upper name (type) 

Peak day 
average day 
annual 

Receipt points 1 

Delivery points 

Contract date rate 
schedule 

Related docket 
start-up date 

CP90-2012-000 (8-17- 
90) 

Texican Natural Gas 
Company 

>50.000 

10,000 

3.650.000 

OTX. OLA, TX, LA, MS, 
AL 

LA......- 

e/20/90 rr_. 

ST90-3645. 0/21/ 
90 

CP90-2020-000 (8-20- 
90) 

Consolidated Fuel 
Corporation 

*25,000 

25.000 

9,125.000 

OTX, OLA, LA. MS. AL... 

GA --- 

6/20/90 IT__ 

ST90-3889. 6/22/ 
90 

CP90-2014-000 (8-20- 
90) 

Centran Corporation _ 

4 1.200.000 
50.000 
438,000,000 

Various... 

OTX. OLA. LA. MS. TX_ 

6/5/90 IT_ 

ST90-3766. 6/28/ 
90 

CP90-2021-000 (8-20- 
90) 

Enron Gas Marketing, 

Inc. 

•25.000 

10,000 

3.650,000 

WY..... 

WY .. 

6/8/90 IT-1... 

ST90-3523. 6/10/ 
90 


1 Offshore Lousiana end offshore Texas are shown as OLA and OTX. 

* Measured in MM9TU equivalent 

3 Measured in MMBtu equivalent 

4 Measured in dt equivalent 

* Measured in Mcf. 




































Federal Register / Vol. 55. No. 171 / Tuesday. September 4, 1990 / Notices 


359411 


Standard Paragraphs 

F. Any person desiring to be heard or 
make any protest with reference to said 
filing should on or before the comment 
date file with the Federal Energy 
Regulatory Commission, 825 North 
Capitol Street. NE., Washington, DC 
20426, a motion to intervene or a protest 
in accordance with the requirements of 
the Commission's Rules of Practice and 
Procedure (18 CFR 385.211 and 385.214) 
and the Regulations under the Natural 
Gas Act (18 CFR 157.10). All protests 
filed with the Commission will be 
considered by it in determining the 
appropriate action to be taken but will 
not serve to make the protestants 
parties to the proceeding. Any person 
wishing to become a party to a 
proceeding or to participate as a party in 
any hearing therein must file a motion to 
intervene in accordance with the 
Commission’s Rules. 

Take further notice that, pursuant to 
the authority contained in and subject to 
jurisdiction conferred upon the Federal 
Energy Regulatory Commission by 
sections 7 and 15 of the Natural Gas Act 
and the Commission’s Rules of Practice 
and Procedure, a hearing will be held 
without further notice before the 
Commission or its designee on this filing 
if no motion to intervene is filed within 
the time required herein, if the 
Commission on its own review of the 
matter finds that a grant of the 
certificate is required by the public 
convenience and necessity. If a motion 
for leave to intervene is timely filed, or if 
the Commission on its own motion 
believes that a formal hearing is 
required, further notice of such hearing 
will be duty given. 

Under the procedure herein provided 
for, unless otherwise advised, it will be 
unnecessary for the applicant to appear 
or be represented at the hearing. 

G. Any person or the Commission’s 
staff may, within 45 days after the 
issuance of the instant notice by the 
Commission, file pursuant to Rule 214 of 
the Commission’s Procedural Rules (18 
CFR 385.214] a motion to intervene or 
notice of intervention and pursuant to 

§ 157.205 of the Regulations under the 
Natural Gas Act (18 CFR 157.205) a 
protest to the request. If no protest is 
filed within the time allowed therefore, 
the proposed activity shall be deemed to 
be authorized effective the day after the 
time allowed for filing a protest if a 
protest is filed and not withdrawn 
within 30 days after the time allowed for 
filing a protest the instant request shall 
be treated as an application for 


authorization pursuant to section 7 of 
the Natural Gas Act. 

Lois D. Cashel), 

Secretary. 

|FR Doc. 90-20656 Hied 8-31-90; 8:45 amj 

BILLING CODE 6717-01-M 


I Docket No. TM90-13-22-0001 

CNG Transmission Corp.; Proposed 
Changes in FERC Gas Tariff 

August 27,1990. 

Take notice that CNG Transmission 
Corporation (“CNG’ f ), on August 22, 

1990, pursuant to section 4 of the 
Natural Cas Act. the Stipulation and 
Agreement approved by the Commission 
on October 6,1989, in Docket Nos. 
RP88-217, et aJ. t and § 12.9 of the 
General Terms and Conditions of CNG’s 
FERC Gas Tariff, 1 filed six (6) copies of 
the following revised tariff sheets to its 
FERC Cas Tariff, First Revised Volume 
No. 1: 

First Revised Sheet No. 40 
First Revised Sheet No. 44 
First Revised Sheet No. 46 
First Revised Sheet No. 47 
First Revised Sheet No. 48 
Second Revised Sheet No. 48 
First Revised Sheet No. 52 

The tariff sheets are proposed to 
become effective on the date indicated 
on each tariff sheet. 

The purpose of the filing is to flow 
through changes in take-or-pay costs 
allocated to CNG by its pipeline 
suppliers. 

Copies of this filing were served upon 
CNG’s customers as well as interested 
parties. 

Any person desiring to be heard or to 
protest said filing should file a protest or 
motion to intervene with the Federal 
Energy Regulatory Commission. 825 
North Capitol Street, NE.. Washington, 
DC 20426, in accordance with Rules 214 
and 211 of the Commission’s Rules of 
Practice and Procedure. 10 CFR 385.214 
and 385.211. All motions or protests 
should be filed on or before September 
4,1990. Protests will be considered by 
the Commission in determining the 
appropriate action to be taken but will 
not serve to make protestants parties to 
the proceeding. Any person wishing to 
become a party must file a motion to 
intervene. Copies of this filing are on file 
with the Commission and are available 
for public inspection. 

Lois D. Cashell, 

Secretary. 

(FR Doc. 90-20661 Filed 8-31-90; 8:45 amj 

BILLING CODE 6717-<lt-l* 


(Docket No. RP90-16S-000! 

Request for Waiver, Mid Louisiana Gas 
Co. 

August 27,1990. 

Take notice that on August 17,1990 
pursuant to section 212 of the 
Commission’s Rules of Practice and 
Procedure, 18 CFR 284.212, Mid 
Louisiana Gas Company (’ Mid 
Louisiana") filed a request for waiver of 
§ 154.303 of the Commission's 
Regulations, 18 CFR 154.303. 

Mid Louisiana states that under 
§ 154.303(e) of the Commission's 
Regulations requires that at least 30 
days prior to the expiration of 36 months 
after the effective date of its previously 
approved base tariff rates, a pipeline is 
required to file tariff sheets restating its 
rates to establish new base tariff rates. 
Mid Louisiana's previously approved 
base tariff rates are to expire September 
1,1990. Accordingly, its restated base 
tariff rates were required to be filed on 
or before August 1.1990. Mid Louisiana 
requests waiver to permit it to file 
restated base tariff rates less than 30 
days before the expiration of its 
previously approved base tariff rates. 

Any person desiring to protest 9aid 
filing should file a protest with the 
Federal Energy Regulatory Commission. 
825 North Capitol Street, NE., 
Washington, DC 20426, in accordance 
with Rules 214 and 211 of the 
Commission’s Rules of Practice and 
Procedure (18 CFR 385.214 and 385.211 
(1990)). All such protests should be filed 
on or before September 17.1990. 

Protests will be considered by the 
Commission in determining the 
appropriate action to be taken, but will 
not serve to make protestants parties to 
the proceeding. Persons that are already 
parties to this proceeding need not file a 
motion to intervene in this matter. 
Copies of this filing are on file with the 
Commission and are available for public 
inspection. 

Lois D. Cashell, 

Secretary r. 

[FR Doc. 90-20660 Filed 8-31-90; 8:45 ain| 

BILLING CODE «717-01-* 


[Docket Nob. CP86-578-030, CP89-1740- 
004 and CP90-203-0021 

Northwest Pipeline Corp; Proposed 
Change In Service Agreements 

August 27.1990. 

Take notice that on August 22,1990, 
Northwest Pipeline Corporation 
("Northwest’’) tendered for filing and 
acceptance new Service Agreements 
under Rate Schedules ODL-1 and DS-t, 












35950 


Federal Register / Vol. 55. No. 171 / Tuesday, September 4, 1990 / Notices 


to be effective October 1,1989, between 
Northwest and Cascade Natural Gas 
Corp., City of Buckley, City of 
Ellensburg, City of Enumclaw, Greeley 
Gas Company, Intermountain Gas 
Company, Northwest Natural Gas 
Company, Utah Gas Service Company, 
Washington Natural Gas Company, 
Washington Water Power Company, 
Western Gas Supply Company and 
Wyoming Industrial Gas Company. 

Northwest states that the above- 
mentioned Service Agreements were 
revised to (1) change it firm sales 
services for certain of its existing Rate 
Schedule ODL-1 and DS-1 sales 
customers, and (2) incorporate a gas 
inventory charge (GIC) and associated 
transportation within sales contract 
demand services. Northwest requests an 
effective date of October 1,1989 for the 
tendered Service Agreements. 

Northwest has also tendered a 
Termination of Service Agreement for 
DS-1 Service to Rocky Mountain 
Natural Gas Company, and for ODL-1 
Service to Paiute Pipeline Company. Inc. 
(successor in interest to Southwest Gas 
Company), pursuant to permission 
granted by the Commission in Opinion 
No. 344. 

A copy of this filing has been mailed 
to the parties listed above. 

Any person desiring to be heard or 
protest said filing should file a motion to 
intervene or protest with the Federal 
Energy Regulatory Commission, 825 
North Capitol Street NE., Washington 
DC 20426, in accordance with Sections 
385.214 and 385.211 of the Commission’s 
Rules of Practice and Procedure. All 
such motions or protests should be filed 
on or before September 4.1990. Protests 
will be considered by the Commission in 
determining the appropriate action to be 
taken, but will not serve to make 
protestants parties to the proceeding. 
Any person wishing to become a party 
must file a motion to intervene. Copies 
of this filing are on file with the 
Commission and are available for public 
inspection in the Public Reference 
Room. 

Lois D. Cashell, 

Secretary. 

[FR Doc. 90-20657 Filed 8-31-90; 8:45 am) 

BILUNG CODE 6717-01-HI 


[Docket No. TM91-1-41-000J 

Paiute Pipeline Co.; Change In Annual 
Charge Adjustment 

August 27, 1990. 

Take notice that on August 21,1990. 
Paiute Pipeline Company (Paiute) 
tendered for filing and acceptance the 


following tariff sheets to be a part of its 
FERC Gas Tariff: 

Original Volume No. 1 

Fifteenth Revised Sheet No. 10 
Original Volume No. 1-A 

Seventh Revised Sheet No. 10 

Paiute states that the purpose of said 
filing is to revise its annual charge 
adjustment surcharge in order to recover 
the Commission’s annual charges for the 
1990 fiscal year. 

Paiute has requested that the 
Commission accept its tariff sheets to 
become effective October 1,1990. 

Paiute states that copies of this filing 
have been mailed to all jurisdictional 
sales customers and affected state 
regulatory commissions. 

Any persons desiring to be heard or to 
protest said filing should file a motion to 
intervene or a protest with the Federal 
Energy Regulatory Commission, 825 
North Capitol Street NE., Washington, 
DC 20426, in accordance with Rules 211 
and 214 of the Commission’s Rules of 
Practice and Procedure (18 CFR 385.211, 
385.214). All such motions or protests 
should be filed on or before September 
4,1990. Protests will be considered by 
the Commission in determining the 
appropriate action to be taken, but will 
not serve to make protestants parties to 
the proceedings. Any person wishing to 
become a party must file a motion to 
intervene. Copies of this filing are on file 
with the Commission and are available 
for inspection. 

Lois D. Cashell 
Secretary. 

[FR Doc. 90-20658 Filed 8-31-90; 8:45 am) 

BILLING COOE 6717-01-M 


[Docket Nos. RP88-27-024, RP88-264-020 
and RP89-138-0091 

United Gas Pipe Une Co.; Tariff Filing 

August 27,1990. 

Take notice that on August 21,1990, 
United Gas Pipe Line Company (United) 
submitted for filing the following tariff 
sheets as part of its FERC Gas Tariff 
and certain working papers in response 
to the Commission’s June 19,1990 Order 
(June 19.1990 Order) and the Notice 
Granting Partial Extension of Time 
issued August 6,1990, in this proceeding. 

First Revised Volume No. 1 
Effective April 1,1989. 

Fourth Revised Sheet No. 4-G.l 
Fourth Revised Sheet No. 4-H 
Fourth Revised Sheet No. 4-1 
Fourth Revised Sheet No. 4-J 
Fourth Revised Sheet No. 4-K 
Fourth Revised Sheet No. 4-L 


Second Revised Volume No. 1 

Effective November 30,1989. 

Second Revised Sheet No. 4J 
First Revised Sheet No. 4j.l 
First Revised Sheet No. 4J.2 
First Revised Sheet No. 4J.3 
First Revised Sheet No. 4).4 
First Revised Sheet No. 4J.5 
First Revised Sheet No. 4J.6 
First Revised Sheet No. 4J.7 

United states that the filing will be 
served upon all parties listed on the 
official service list in this proceeding. 

Any person desiring to be heard or to 
protest said filing should file a motion to 
intervene or protest with the Federal 
Energy Regulatory Commission, 825 N. 
Capitol Street, NE, Washington, DC, 
20426, in accordance with Sections 
385.214 and 385.211 of the Commission’s 
regulations. All such motions of protest 
should be filed on or before September 
4.1990. 

Protests will be considered by the 
Commission in determining the 
appropriate action to be taken, but will 
not serve to make protestants parties to 
the proceedings. Aiiy person wishing to 
become a party must file a Motion to 
Intervene in accordance with the 
Commission’s Regulations. Copies of 
this filing are on file with the 
Commission and are also available at 
United’s office in Houston, Texas and 
are available for public inspection. 

Lois D. Cashell, 

Secretary. 

[FR Doc. 90-20569 Filed 8-31-90; 8:45 am] 

BILLING CODE 6717-01-M 


Office of Hearings and Appeals 

Proposed Implementation of Special 
Refund Procedures 

AGENCY: Office of Hearings and 
Appeals, Department of Energy. 

action: Notice of proposed 
implementation of special refund 
procedures. 

summary: The Office of Hearings and 
Appeals (OHA) of the Department of 
Energy (DOE) announces modifications 
to the proposed procedures for 
disbursement of $1,187,500, plus accrued 
interest, obtained by the DOE under the 
terms of a consent order entered into 
with Time Oil Company. The DOE has 
tentatively determined that injured Time 
Oil customers should be given an 
opportunity to submit claims for direct 
restitution before any remaining funds 
are distributed for indirect restitution in 
accordance with the terms of that 
consent order. 














Federal Register / Vol. 55, No. 171 / Tuesday. September 4. 1990 / Notices 


35951 


dates and ADDRESSES: Comments must 
be filed in duplicate within 30 days of 
publication of this notice in the Federal 
Register and should be addressed to: 
Office of Hearings and Appeals, 
Department of Energy, 1000 
Independence Avenue. SW., 

Washington, DC 20585. All comments 
should display a reference to case 
number KEF-0129. 

FOR FURTHER INFORMATION CONTACT: 

Thomas O. Mann, Deputy Director, 

Roger Klurfeld, Assistant Director, 

Office of Hearings and Appeals, 1000 
Independence Avenue. SW. 

Washington, DC 20585, (202) 585-2094 
(Mann); 585-2383 (Klurfeld). 
SUPPLEMENTARY INFORMATION: In 
accordance with 10 CFR 205.282(b), 
notice is hereby given of the issuance of 
the Proposed Decision and Order set out 
below. The Proposed Decision and 
Order sets forth the procedures that the 
DOE has tentatively formulated to 
distribute funds obtained from Time Oil 
Company (Time). The funds are being 
held in an interest-bearing escrow 
account pending distribution by the 
DOE. 

The DOE and Time entered into a 
December 13,1982 consent order that 
resolved, with specific exceptions, all 
civil and administrative disputes 
regarding Time’s compliance with the 
DOE’s price and allocation regulations. 
As explained in the Proposed Decision 
and Order, the Time consent order 
identifies one injured purchaser to 
receive direct restitution, and seven 
states which are designated to receive 
the remainder of the funds for indirect 
restitution to citizens of these states. 
Since this Consent Order was issued 
before the enactment of the Petroleum 
Overcharge Distribution and Restitution 
Act of 1980 (PQDRA), such funds could 
be distributed directly to the named 
recipients without use of DOE’s Subpart 
V refund regulations. 15 U.S.C. 

4501(c)(3). Nevertheless, in view of the 
unique circumstances of this case, we 
are proposing that all injured Time 
customers tie permitted to file refund 
claims before any unclaimed monies are 
distributed. When the seven designated 
states receive their funds for indirect 
restitution, they will be subject to 
OHA's '‘second-stage” refund 
procedures. 

Any member of the public may submit 
written comments regarding the 
proposed refund procedures. 
Commenting parties are requested to 
provide two copies of their submissions. 
Comments must be submitted within 30 
days of publication of this notice in the 
Federal Register and should be sent to 
the address set forth at the beginning of 


this notice. All comments received in 
this proceeding will be available for 
public inspection between the hours of 1 
p.m. and 5 p.m., Monday through Friday, 
except federal holidays, in the Public 
Reference Room of the Office of 
Hearings and Appeals, located in room 
IE-234,1000 Independence Avenue, 

SW., Washington, DC 20585. 

Dated: August 27.1990. 

George B. Brcznay, 

Director, Office of Hearings and Appeals. 

Proposed Decision and Order of the 
Department of Energy 

Implementation of Special Refund 
Procedures 

August 27,1990. 

Name of Petitioner Time Oil 
Company. 

Dele of Filing; April 18,1989. 

Case Number, KEF-0129. 

On April 13,1989, the Economic 
Regulatory Administration (ERA) filed a 
Petition with the Office of Hearings and 
Appeals (ORA) of the Department of 
Energy (DOE) requesting that the OHA 
formulate and implement procedures, in 
accordance with the provisions of 10 
CFR part 205, subpart V (subpart), for 
distributing funds obtained through the 
settlement of enforcement proceedings 
brought against Time Oil Company 
(Time) by the DOF. 

/. Background 

During the period August 20,1973 
through January 27,1981, Time was 
engaged in the refining of crude oil and 
the sale of refined petroleum products. It 
was, therefore, a “refiner” as that term 
is defined in 10 CFR 212.31, and subject 
to the federal petroleum price and 
allocation regulations in existence at 
that time. The ERA conducted audits of 
Time's compliance with the price and 
allocation regulations during that period. 
During and as a result of those audits, 
disputes arose between Time and the 
DOE concerning the firm’s compliance 
with the regulations, some cf which led 
to the issuance of a Notice of Probable 
Violation to Time on February 29,1900. 

In order to avoid protracted and 
costly litigation. Time and the DOE 
agreed to enter into a consent order, 
which became final on December 13, 
1982. The consent order resolved, with 
certain specified exceptions, all civil 
and administrative disputes regarding 
Time’s compliance with the regulations. 
Pursuant to the settlement agreement, 
Time paid the DOE $1,107,500 on 
December 22,1982. The settlement 
agreement funds have been placed in an 
interest-bearing escrow account 
maintained by the Department of the 


Treasury for ultimate distribution by the 
DOE. 

In its Petition for the Implementation 
of Special Refund Procedures, the ERA 
states that it was able to identify a claim 
of the Defense Fuel Supply Center 
(DFSC), which was the only purchaser 
of jet fuel from Time during the months 
selected for intense audit Petition at 2. 
The consent order therefore provides for 
the distribution of $325,000 to the DFSC. 
In addition, the consent order provides 
that Hie DOE will distribute the 
remaining amount to the treasurers of 
the seven states within which Time sold 
covered products during the period 
November 1973-January 1981, 
Washington, Oregon, California. Idaho, 
Montana, Nevada and Hawaii. Id. Each 
state's portion of the remaining funds 
was calculated according to the share of 
Time's total volume of gasoline sold in 
that state during the relevant period. 

The ERA requests that the OHA 
establish refund procedures pursuant to 
Subpart V for the distribution of the 
funds that have been obtained from 
Time and distribute the Time money in 
accordance with the express terms of 
the consent order. Id. at 3. 

On April 5,1990, the OHA issued a 
Proposed Decision and Order (PDO) that 
established tentative procedures for 
distributing the Time funds. The PDO 
was published in the Federal Register on 
April 16,1990 at 55 FR 14122. In the 
PDO, we tentatively determined that the 
DFSC. the only injured purchaser of 
Time refined petroleum products 
identified in the consent order, should 
receive a refund in the indicated 
amount, and that the seven states would 
share the remainder of the funds in the 
manner suggested in the consent order. 

The States of Oregon and Washington 
filed the only comments regarding the 
proposed procedures, urging OHA to 
expedite release of the Time funds. 
However, we have reconsidered the 
proposed Time refund procedures, and 
determined that they should be modified 
in two respects. First, we have 
concluded that it would be more 
appropriate at this point to allow a 
claims process to proceed. This will 
permit injured purchasers of Time 
refined petroleum products who were 
not identified in the 1982 consent order 
to submit claims before any residual 
funds are distributed to the seven states. 
Second, we have determined that the 
use of the unclaimed funds which are 
distributed to the seven states for 
indirect restitution should be governed 
by OHA’s “second stage refund 
procedures.” In view of these changes, 
we will issue this new Proposed 
Decision and Order to provide 










35952 


Federal Register / Vol. 55, No. 171 / Tuesday. September 4. 1990 / Notices 


interested parties with notice and an 
opportunity to comment on the modified 
Time refund procedures. 

II. Reasons for Reconsidering Time 
Refund Procedures 

There are a number of unique factors 
which make this case different from 
other subpart V refund procedures. As 
noted above, the consent order involved 
dates back to 1982, before the enactment 
of the Petroleum Overcharge 
Distribution and Restitution Act of 1986 
(PODRA), 15 U.S.C. 4501-07. During that 
early period, the DOE used a variety of 
restitutionary remedies for oil 
overcharges, not just Subpart V. See 
DOE Ruling 1984-1, 49 FR 22064 (May 25. 
1984). The Time consent order is 
especially unusual in its use of a hybrid 
approach. It identified the DFSC as the 
sole injured Time jet fuel customer and 
earmarked $325,000 to redress that 
injury. However, it failed to provide any 
direct restitution for other injured Time 
customers, particularly those who 
brought motor gasoline, the firm’s other 
major product. Instead, the consent 
order skipped that step altogether, and 
designated the seven states to receive 
all remaining Time funds as indirect 
restitution to benefit unidentified 
persons, including Time’s gasoline 
customers, who were injured by the 
firm’s alleged overcharges. If the Time 
consent order had been executed after 
enactment of PODRA in October 1986. 
the firms’s other customers, including 
those who purchased gasoline from the 
firm, would also have been accorded an 
opportunity to file claims for direct 
restitution before any residual funds 
could be distributed to the states. 

Section 3002(c)(3) of PODRA excludes. 
inter alia, from its mandatory Subpart V 
refund distribution scheme any amount 
designated in a DOE consent order for 
disbursement to a person or class of 
persons, if the consent order was issued 
before the date of enactment of PODRA 
(October 21.1986). 15 U.S.C. 4501(c)(3). 
The legislative history of this provision 
makes clear that the exclusion applies in 
cases where funds being held by the 
DOE have been designated for 
disbursement to particular individuals 
or classes of person, “either as direct or 
indirect restitution.” H.R. Conf. Rep. No. 
1012, 99th Cong., 2d Sess., reprinted in 
1986 U.S. Code Cong. & Admin. News 
3868, 3878. This “grandfather clause” 
was designed to allow the courts and 
the DOE to implement orders for 
restitution to identified parties that were 
effective prior to the enactment of 
PODRA where the funds were 
designated for specific entities but not 
yet distributed. This statutory provision 
clearly applies to the Time funds, and 


thus the use of subpart V is not 
mandatory here. 

Nevertheless, if we w'ere to implement 
the refund distribution plan precisely as 
set forth in the consent order, it is clear 
that a group of injured Time gasoline 
customers would lose the opportunity to 
file claims for direct restitution. In view 
of the current statutory refund policy 
and certain factors which are unique to 
this particular case, injured persons who 
merit direct restitution should be given 
the opportunity to claim a portion of the 
Time funds before the remaining portion 
is distributed to the seven states. The 
unique factors in this case are as 
follows: (1) the 1982 consent order 
singles out one injured purchaser for 
direct restitution; (2) no effort was made 
when the consent order was executed to 
locate any other of Time’s injured 
purchasers; and (3) Time is a regional 
marketer of refined products whose 
other injured purchasers can be 
identified so that they may also submit 
claims for direct restitution. Therefore, 
allhough we are not required to 
establish the Time refund proceedings 
under subpart V, we will permit 
unidentified purchasers of Time refined 
petroleum products during the period of 
price controls to submit applications for 
refund. 

Ill Modified Refund Procedures 

As indicated above, we will 
implement a two-stage refund process 
by which the DFSC, and purchasers of 
Time covered products other than jet 
fuel during the period August 20,1973 
through January 27,1981 may submit 
Applications for Refund in the initial 
stage, and any monies remaining after 
the payment of all valid first-stage 
claims will be remitted to the seven 
states in the proportional shares 
specified in the consent order for 
indirect restitution as second-stage 
refunds. From our experience with 
Subpart V proceedings, we expect that 
potential applicants generally will fall 
into the following categories: (1) End- 
users; (2) regulated entities, such as 
public utilities, and cooperatives; and (3) 
refiners, resellers and retailers 
(hereinafter collectively referred to as 
“resellers”). 

A Claims Based Upon Alleged 
Overcharges 

In order to receive a refund, each 
claimant will be required to submit a 
schedule of its monthly purchases of 
Time covered products during the refund 
period. If the product was not purchased 
directly from Time, the claimant must 
establish that the product originated 
with Time. Additionally, a reseller 
claimant, except one who chooses to 


utilize the injury presumptions set forth 
below, will be required to make a 
detailed showing that it was injured by 
Time’s alleged overcharges. This 
showing will generally consist of two 
distinct elements. First, a reseller 
claimant will be required to show that it 
had “banks” of unrecouped increased 
product costs in excess of the refund 
claimed. * 1 Second, because a showing of 
banked costs alone is not sufficient to 
establish injury, a claimant must provide 
evidence that market conditions 
precluded it from increasing its prices to 
pass through the additional costs 
associated with the alleged overcharges. 
See Vickers Energy Corp./Hutchins Oil 
Co., 11 DOE 85.070, at 88,105 (1983). 
Such a showing could consist of a 
demonstration that a firm suffered a 
competitive disadvantage as a result of 
its purchases from Time. See National 
Helium Co./Atlantic Richfield Co., It 
DOE H 85.257 (1984), aff'd sub nom. 
Atlantic Richfield Co., v. DOE, 618 F. 
Supp. 1199 (D. Del. 1985). 

1. The Use of Presumptions. Our 
experience also indicates that the use of 
certain presumptions permits claimants 
to participate in the refund process 
without incurring inordinate expense 
and ensures that refund claims are 
evaluated in the most efficient manner 
possible. See, e.g., Marathon Petroleum 
Co., 14 DOE H 85,269 (1986) [Marathon). 
The use of presumptions in refund cases 
is specifically authorized by the 
applicable subpart V regulations at 10 
CFR 205.282(e). Accordingly, we adopt 
the presumptions set forth below. 

a. Calculation of Refunds. First we 
will adopt a presumption that the 
alleged overcharges were dispersed 
equally in all of Time’s sales of refined 
petroleum products during the refund 
period. In accordance with this 
presumption, refunds are made on a per 
gallon or volumetric basis. 2 In the 


1 Claimants who have previously relied upon 
their banked costs in order to obtain refunds in 
other special refund proceedings should subtract 
those refunds from the cumulative banked costs 
submitted in this proceeding. See Husky OH Co./ 
Metro Oil Products. Inc.. 16 DOE 185.090. at 88.179 
(1987). Additionally, a claimant may not receive a 
refund [or any month in which it ha 9 a negative 
cumulative bank (for that product) or for any 
preceding month. See Standard Oil (Indiana)/ 
Suburban Propane Gas Corp., 13 DOE f 85.030 at 
88.082 (1985). If a claimant no longer has records 
showing its banked costs, the OHA may exercise its 
discretion to allow approximations of those banks 
prepared by the applicant. See Gulf Oil Corp./ 
Sturdy Oil Co.. 15 DOE | 85,187 (1986). 

1 Because we realize that the impact on a 
individual claimant may have been greater than the 
volumetric refund amount, we will allow any 
purchaser to file a refund application based upon a 
claim that it suffered a disproportionate share of 
Time's alleged overcharges. See. e.g.. Standard Oil 

Continued 












Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Notices 


35953 


absence of belter information, a 
volumetric refund is appropriate 
because the DOE price regulations 
generally required a regulated firm to 
account for increased costs on a firm¬ 
wide basis in determining its prices. 

Under the volumetric approach, a 
claimant's “allocable share” of the 
consent order fund is equal to the 
number of gallons purchased from Time 
during the refund period multiplied by 
the per gallon refund amount. In the 
present case, the per gallon refund 
amount is $.0012. We derived this figure 
by dividing the consent order fund, 
$2,136,863, by 1,776.655,181 gallons, the 
approximate number of gallons of 
covered refined products which Time 
sold during the refund period. A firm 
that establishes its entitlement to a 
refund will receive all or a portion of its 
allocable share plus a pro-rata share of 
the interest that has accrued on the 
Time consent order fund since August l f 
1900. 3 

In addition to the volumetric 
presumption, we will adopt a number of 
presumptions regarding injury for 
claimants in each category listed below. 

b. End-Users. In accordance with prior 
subpart V proceedings, we will adopt 
the presumption that an end-user or 
ultimate consumer of Time petroleum 
products whose business is unrelated to 
the petroleum industry was injured by 
the alleged overcharges settled by the 
consent order. See, e g., Texas Oil and 
Cos Corp., 12 DOE 85,069, at 88,209 
11984) [TOCCO). Unlike regulated firms 
in the petroleum industry, members of 
this group generally were not subject to 
price controls during the refund period, 
and were not required to keep records 
which justified selling price increases by 
reference to cost increases. 
Consequently, analysis of the impact of 


(Indiana)/Army and Air Force Exchange Service, 12 
DOE1 85.015 (1984). Such an application will be 
granted only if an applicant make# a persuasive 
showing that: (1) it was “overcharged" by 8 specific 
amount, and (2) it was injured by those overcharges 
See Panhandle Eastern Pipeline Co./Western 
Petroleum Co., 19 DOE ? 85.705 (1989): Mobil Oil 
Co. Contra Pehyjfeum Corp.. 19 DOE 1 35.070 (1980), 
and cases cited therein. To the extent that a 
claimant makes this showing, it will receive a 
refund above the volumetric refund level. In 
computing the appropriate refund amount, we will 
prorate the alleged overcharge amounts by the ratio 
of the Time consent order amount as compared to 
the aggregate overcharge amount alleged by the 
ERA. Am tel. Inc./Whitco, Inc.-, 19 DOE $ 65 319 
(1989) [Amtel/Whitco). 

a As in previous cases, we still establish a 
minimum refund amount of $15. In this 
determination. an> potential claimant which 
purchased less than 12.500 gallons of petroleum 
products would have an allocable share of Ics9 than 
SI5. We have found through our experience that the 
cost of processing claims in which refunds for 
amounts less than $15 are sought outweighs the 
benefits or restitution in those instances. See Exxon 
Corp., 17 DOE \ 85.590 at 89.150 (1988) [Exxon). 


the alleged overcharges on the final 
prices of goods and services produced 
by members of this group would be 
beyond the scope of the refund 
proceeding. Id. We have concluded, 
therefore, that the end-users of Time 
refined petroleum products need only 
document their purchase volumes from 
Time during the refund period to make a 
sufficient showing that they were 
injured by the alleged overcharges. 

c. Regulated Firms and Cooperatives. 
A claimant whose prices for goods and 
services are regulated by a 
governmental agency (;.e.. a public 
utility), or an agricultural cooperative 
which is required by its charter to pass 
through cost savings its member 
purchasers, need only submit 
documentation of purchases used by 
itself or. in the case of a cooperative, 
sold to its members in order to receive a 
full volumetric refund. However, a 
regulated firm or a cooperative will also 
be required to certify that it will pass 
through any refund received to its 
customers or member-customers, 
provide us with a full explanation of 
how it plans to accomplish the 
restitution, and certify that it will notify 
the appropriate regulatory body or 
membership group of the receipt of the 
refund. See Marathon , 14 DOE at 88,514- 
15. These requirements are based upon 
the presumption that, with respect to a 
regulated firm, any overcharges would 
have been routinely passed through to 
its customers. Similarly, any refunds 
received should be passed through to its 
customers. W ith respect to a 
cooperative, in general, the cooperative 
agreement which controls its business 
operations would ensure that the alleged 
overcharges, and similarly refunds, 
would be passed through to its member- 
customers. Accordingly, these firms will 
not be required to make a detailed 
demonstration of injury. 4 

d. Refiners, Resellers and Retailers — 
i. Small Claims Presumption. We will 
adopt a “small claims'* * * presumption that 
a firm which resold Time products and 
requests a small refund was injured by 
the alleged overcharges. Under the small 
claims presumption, a refiner, reseller or 
retailer seeking a refund of $5,000 or 
less, exclusive of interest, will not be 
required to submit evidence of injury 
beyond documentation of the volume of 
Time products it purchased during the 
refund period. See TOCCO , 12 DOE at 
88,210. Thi9 presumption is based on the 
fact that there may be considerable 


* A cooperative*# purchases of Time products 
which were resold to non-members will be treated 
in a manner consistent with purchases made by 
other resellers. See Total Petroleum. Inc./Formers 
Petroleum Cooperative, Inc.. 19 DOE $ 85.21!! (1989). 


expense involved in gathering the types 
of data necessary to support a detailed 
claim of injury; for small claims the 
expense might possibly exceed the 
potential refund. Consequently, failure 
to allow simplified refund procedures 
for small claims could deprive injured 
parties of their opportunity to obtain a 
refund. Furthermore, use of the small 
claims presumption is desirable since it 
allows the OHA to process routine 
refund claims in an efficient manner. 5 * 

ii. Mid-Level Claim Presumption. In 
addition, a refiner, reseller or retailer 
claimant whose allocable share of the 
refund pool exceeds $5,000, excluding 
interest, may elect to receive as its 
refund either $5,000 or 40 percent of its • 
allocable share, up to $50,000, whichever 
is larger.® The use of this presumption 
reflects our conviction that these larger, 
mid-level claimants were likely to have 
experienced some injury as a result of 
the alleged overcharges. See Marathon , 
14 DOE at 88,515. In some prior special 
refund proceedings, we have performed 
detailed analyses in order to determine 
produce-specific levels of injury. See 
e g., Getty Oil Co., 15 DOE 85,064 
(1986). However, in Gulf Oil Corp., 16 
DOE H 85,381, at 88,737 (1987), we 
determined that based upon the 
available data, it was more accurate 
and efficient to adopt a single 
presumptive level of injury of 40 percent 
for all mid-levels claimants, regardless 
of the refined product that they 
purchased, based upon the resullB of our 
analyses in prior proceedings. We 
believe that approach generally to be 
sound, and we therefore will adopt a 40 
percent presumptive level of injury for 
all mid-level claimants in this 
proceeding. Consequently, an applicant 
in this group will only be required to 
provide documentation of its purchase 
volumes of Time refined petroleum 
products during the refund period in 
order to be eligible to receive a refund of 
40 percent of its total allocable share, up 
to $50,000. or $5,000, whichever is 
greater. 7 


* In order to qualify for a refund under the small 
claims presumption, a refiner, reseller, or retailer 

must have purchased less than 4.106,607 gallons of 
Time refined petroleum products during the refund 

period. 

• That is. claimants who purchased more than 
4,166.887 gallons of Time refined petroleum products 

during the refund period (mid-level claimants) may 

elect to utilize this presumption. 

7 A claimant who attempts to make a detailed 
showing of injury in order to obtain 100 percent of 
its allocable share but, instead, provides evidence 
that leads us to conclude that it passed through all 
of the alleged overcharges, or that it is eligible for a 
refund of less than the applicable presumption-level 
refund may not then be eligible for a presumption- 
based refund. Instead, auch a claimant may receive 

Continued 













35954 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Notices 


iii. Spot Purchasers. We will adopt a 
rebuttable presumption that a reseller 
that made only spot purchases from 
Time did not suffer injury as a result of 
those purchases. As we have previously 
stated, spot purchasers generally had 
considerable discretion as to the timing 
and market in which they made their 
purchases, and therefore would not have 
made spot market purchases from a firm 
at increased prices unless they were 
able to pass through the full amount of 
the firm’s selling price to their own 
customers. See. e.g., Vickers, 8 DOE at 
85.396-97. Accordingly, a spot purchaser 
claimant must submit specific and 
detailed evidence to rebut the spot 
purchaser presumption and to establish 
the extent to which it was injured as a 
result of its spot purchases from Time.* * 

B. Allocation Claims. W'e may also 
receive claims based upon Time s 
alleged failure to furnish petroleum 
products that it was obliged to supply 
under the DOE allocation regulations 
that became effective in January 1974. 
See 10 CFR part 211. Any such 
applications will be evaluated with 
reference to the standards set forth in 
subpart V implementation cases such as 
Office of Sped a! Counsel, 10 DOE 
U 85.048 at 88,220 (1082), and refund 
application cases such as Mobil Oil 
Carp./Reynolds Industries, Inc., 17 DOF 
| 85,608 (1988); Marathon Petroleum 
Co./Research Fuels. Ina. 19 DOE 
11 85,575 (1989). action for review 
pending. No. CA3-89-29a3C (N.D. Tex. 
filed Nov. 22.1989) (Marathon/RFl). 
These standards generally require an 
allocation claimant to demonstrate the 
existence of a supplier/purchaser 
relationship with Time and the 
likelihood that Time failed to furnish 
petroleum products that it was obliged 
to supply to the claimant under 10 CJ\R. 
part 211. In addition, the claimant 
should provide evdience that it had 
contemporaneously notified the DOE or 
otherwise sought redress from the 
alleged allocation violation. Finally, the 
claimant must establish that it was 
injured and document the extent of the 
injury. 

In our evaluation of whether 
allocation claims meet these standards, 
we will consider various factors. For 


a refund which reflects the level of injury 
established in its application. No refund will be 
approved if its submission indicates that it was not 
injured as a result of its purchases from Time. See 
Exxon. 17 DOF. at 89 150 n. 10. 

• In prior proceedings, we have stated that 
refunds will be approved for spot purchasers who 
demonstrate that: (1) they made the spot purchases 
for the purpose of ensuring a supply for their base 
period customers rather than in anticipation of 
financial advantage as a result of those purchases, 
and [2) they were forced by market conditions lo 
resell the product at a loss. 


example, we will seek to obtain as much 
information as possible about the 
agency's treatment of complaints made 
to it by the claimant. We will also look 
at any affirmative defenses that Time 
may have had to the alleged allocation 
violation. See Marathon/RFl. In 
assessing an allocation claimant's 
injury, we will evaluate the effect of the 
alleged allocation violation on its entire 
business operation, with particular 
reference to the amount of product that 
it received from suppliers other than 
Time. In determining the amount of an 
allocation refund, we will utilize any 
information that may be available 
regarding the portion of the Time 
consent order amount that the agency 
attributed to allocation violations in 
general and to the specific allocation 
violation alleged by the claimants. 
Finally, since the Time consent order 
reflects a negotiated compromise of the 
issues involved in the enforcement 
proceedings against Time and the 
consent order amount is less than 
Time’s potential liability in those 
proceedings, we will prorate those 
allocation refunds that would otherwise 
be disproportionately large in relation to 
the consent order fund. Cf. Amtel/ 
VVh/tco. 

fV. Distribution of Refunds Remaining 
After Consideration of All Refund 
Applications 

We propose that all unclaimed money 
remaining in the Time escrow account 
after all meritorious refund applicants 
are paid be distributed in the manner 
suggested in the consent order to the 
seven states in which Time sold covered 
products during the period November 
1973 through January 1981. As stated 
above, each state's portion of the 
remaining funds was calculated 
according to the share of Time's total 
volume of gasoline sold in that state 
during the elevant period. Those funds 
will be allocated to the seven identified 
states in proportions equal to those by 
which the original states' pool of 
$802,500 was apportioned. 

Since these funds have been 
exempted from PODRA requirements, 
they will be distributed under OI IA‘s 
second-stage refund procedures. These 
procedures have normally been used by 
OHA to ensure that indirect restitution 
of oil overcharges to the states is 
proportional to the injury experienced 
and provides timely restitutionary 
benefits. The states are familiar with 
this process. See “A Report on State 
Expenditures of Oil Overcharges," DOE 
Publication No. DOE/HG-003 (January 
1990). Each of the seven affected states 
will be required to submit a 


restitutionary plan to the OHA. Upon 
approval of the plan, the OHA will order 
the disbursement of the state's share of 
the funds, including a proportionate 
share of accrued interest. 

Detailed requirements applicable to 
the states' restitutionary plans will be 
addressed in a Utter Decision and Order, 
to be issued when we have completed 
the processing of all Time refund 
applications. 

It Is Therefore Ordered That: 

The amount remitted to the 
Department of Energy by Time Oil 
Company pursuant to Consent Order 
No. 000S00068 will be distributed in 
accordance with the foregoing Decision. 
|FR Doc. 90-20735 Filed 8-31-90: 8:45) 

BILLING COOC M5001-M 


ENVIRONMENTAL PROTECTION 
AGENCY 

l FRL-3827-2) 

Science Advisory Board; Radiation 
Advisory Committee; Radionuclides in 
Drinking Water Subcommittee; 
Conference Call Meeting 

September 17,1990. 

Under Public Law 92-463. notice is 
hereby given that the Radionuclides in 
Drinking Water Subcommittee of the 
Science Advisory Board's Radiation 
Advisory Committee will hold an 
additional conference call to edit its 
report on the review of four criteria 
documents on radionuclides in drinking 
water. The additional call is scheduled 
for Monday. September 17.1990 at 12:00 
to 2:00 p m. e.d.t. 

The Subcommittee required additional 
time because it has decided to combine 
the four individual reports (on radon, 
radium, uranium, and gross beta) into a 
single report. 

Members of the public may 
participate by providing oral or written 
consent or by listening to the calls. 
However, the availability to participate 
is limited by the nature of the 
conference call equipment. Members of 
the public wishing further information 
should call either Mrs. Dorothy Clark or 
Mrs. Kathleen Conway at 202/382-2552. 
Those wishing to participate in the 
conference call should call by noon on 
the Friday before the scheduled call. 

Dated: August 27.1990. 

Donald G. Barnes, 

Director. Science Advisory Board. 

|FR Doc. 90-20728 Filed 8-31-90; 8:45 am) 

BILLING COO€ 6560-50-M 













Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35955 


(OPP-00292; FRL-3800-1] 

FIFRA Scientific Advisory Panel 
Subpanel; Open Meeting 

agency: Environmental Protection 
Agency (EPA). 

action: Notice of open meeting. 

summary: There will be a 1-day meeting 
of the Federal Insecticide, Fungicide, 
and Rodenticide Act (FIFRA) Scientific 
Advisory Panel (SAP) Subpanel to 
review a set of scientific issues being 
considered by the Agency in connection 
with a proposed rule under 40 CFR part 
1?2 to amend its experimental use permit 
(EUP) regulations for pesticides. The 
proposed rule clarifies the 
circumstances under which an EUP is 
required for small-scale field testing of 
genetically altered microbial pesticides. 
The meeting will be open to the public. 
DATES: The meeting will be held on 
Wednesday, September 26,1990. from 
8 30 a.m. to 4:30 p.m. 
addresses: The meeting will be held at: 
I loliday Inn-Crowne Plaza, 300 Army 
Navy Drive, Arlington, VA 22202. (703) 
892-4100. 

FOR FURTHER INFORMATION CONTACT: By 

mail: Robert B. Jaeger, Designated 
Federal Official, FIFRA Scientific 
Advisory Panel (H7509C), Office of 
Pesticide Programs, Environmental 
Protection Agency, 401 M St., SW., 
Washington, DC 20460. Office location 
end telephone number Rm. 821C, CM 
f* 2, 1921 Jefferson Davis Highway, 
Arlington, VA, (703) 557-4369/2244. 
SUPPLEMENTARY INFORMATION: The 
agenda for this meeting includes the 
review of the scientific issues being 
considered by the Agency on a proposed 
regulation amending 40 CFR part 172 to 
clarify the circumstances under which 
an EUP is presumed not to be required 
and to specify that the presumption is 
based upon risk. The Agency also 
proposes to implement a review 
procedure that requires notification 
before initiation of small-scale testing of 
certain genetically modified microbial 
pesticides. The Agency will review each 
notification in order to assess the 
potential for adverse impacts on human 
health or the environment and will then 
determine whether an EUP is required. 
This notification scheme would 
implement provisions of the Agency’s 
policy statement of June 26,1986 (51 FR 
23302), with modifications, and is 
intended to provide sufficient oversight 
of the early stages of testing of these 
microbial pesticides. 

The Agency has convened a Subpanel 
of the SAP to review the scientific issues 
on the proposed rule. The Subpanel will 
be chaired by Dr. James Tiedje, a 


member of the SAP. Disciplines of the 
Subpanel will include expertise in 
microbiology, entomology, molecular 
biology, human pathology, plant 
pathology, and soil science. 

Copies of documents relating to the 
topics listed above, may be obtained by 
contacting: By mail: Public Docket and 
Freedom of Information Section, Field 
Operations Division (H7506C). Office of 
Pesticide Programs, Environmental 
Protection Agency, 401 M St., SW., 
Washington. DC. 20460. Office location 
and telephone number: Rm. 244 Bay. CM 
#2,1921 Jefferson Davis Highway, 
Arlington, VA, (703) 557-2805. 

Any member of the public wishing to 
submit written comments should contact 
Robert B. Jaeger at the address or the 
telephone number given above to be 
sure that the meeting is still scheduled 
and to confirm the Subpanel’s agenda. 
Interested persons are permitted to file 
written statements before the meeting. 
To the extent that time permits and 
upon advance notice to the Designated 
Federal Official, interested persons may 
be permitted by the chairman of the 
Scientific Advisory Panel to present oral 
statements at the meeting. There is no 
limit on written comments for 
consideration by the Subpanel, but oral 
statements before the Subpanel are 
limited to approximately 5 minutes. 
Since oral statements will be permitted 
only as time permits, the Agency urges 
the public to submit written comments 
in lieu of oral presentations. Information 
submitted as a comment in response to 
this notice may be claimed confidential 
by marking any part or all of that 
information as "Confidential Business 
Information" (CBI). Information so 
marked will not be disclosed except in 
accordance with procedures set forth in 
40 CFR part 2. A copy of the comment 
that does not contain CBI must be 
submitted for inclusion in the public 
docket. Information not marked 
confidential will be included in the 
public docket without prior notice. The 
public docket will be available for 
public inspection in Room 244 Bay at the 
address given above, from 8 a.m. to 4 
p.m., Monday through Friday, excluding 
legal holidays. All statements will be 
made part of the record and will be 
taken into consideration by the 
Subpanel. 

Persons wishing to make oral and/or 
written statements should notify the 
Designated Federal Official and submit 
10 copies of a summary no later than 
September 18,1990, in order to ensure 
eppropriate consideration by the 
Subpanel. 


Dated: August 27.1990. 

Victor J. Kimm, 

Acting Assistant Administrator for Pesticides 
ond Toxic Substances. 

[FR Doc. 90-20731 Filed 8-31-90; 8:45 am) 

etUJNG CODE 8550-50-f 


[OPTS-140136; FRL-3797-6] 

Access to Confidential Business 
Information by Chemical Abstracts 
Service 

agency: Environmental Protection 
Agency (EPA). 
action: Notice. 

summary: EPA has authorized the 
Chemical Abstracts Service (CAS), of 
Columbus, Ohio, for access to 
information which has been submitted 
to EPA under sections 5 and 8 of the 
Toxic Substances Control Act (TSCA). 
Some of the information may be claimed 
or determined to be confidential 
business information (CBI). 
dates: Access to the confidential data 
submitted to EPA will occur no sooner 
than September 14,1990. 

FOR FURTHER INFORMATION CONTACT: 
Michael M. Stahl, Director. TSCA 
Environmental Assistance Division (TS- 
799), Office of Toxic Substances, 
Environmental Protection Agency, Rm. 
E-545, 401 M St., SW., Washington, DC 
20460, (202) 554-1404, TDD: (202) 554- 
0551. 

SUPPLEMENTARY INFORMATION: Under 
contract number 68-W9-0028, Chemical 
Abstracts Service, of 2540 Olentangy 
River Road, Columbus, Ohio, will assist 
the Office of Toxic Substances in 
developing, maintaining, and operating 
the TSCA Chemical Substance 
Inventory. 

In accordance with 40 CFR 2.30o(j), 
EPA has determined that under EPA 
contract number 68-W0-0028, CAS will 
require access to CBI submitted to EPA 
under sections 5 and 8 of TSCA to 
perform successfully the duties specified 
under the contract. CAS personnel will 
be given access to information 
submitted under sections 5 and 8 of 
TSCA. Some of the information may be 
claimed or determined to be CBI. 

In a previous notice published in the 
Federal Register of March 19,1990 (55 
FR 10112), CAS was authorized for 
access to CBI submitted to EPA under 
sections 5 and 8 of TSCA. EPA is issuing 
this notice to continue CAS’s access to 
TSCA CBI for the duration of the new 
contract no. 68-W0-0028. 

EPA is issuing this notice to inform all 
submitters of information under sections 
5 and 8 of TSCA that EPA may provide 











35956 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


CAS access to these CBI materials at 
CAS facilities on a need-to-know basis. 
All access to TSCA CBI under this 
contract will take place at EPA 
Headquarters and CAS's Columbus, 
Ohio facilities. CAS has been authorized 
access to TSCA CBI at its facilities 
under the EPA “Contractor 
Requirements for the Control and 
Security of TSCA Confidential Business 
Information” security manual. EPA has 
approved CAS’s security plan and has 
performed the required inspections of 
their facilities and has found them to be 
in compliance with the requirements of 
the manual. 

Clearance for access to TSCA CBI 
under this contract may continue until 
June 30,1995. 

CAS personnel will be required to 
sign non-disclosure agreements and will 
be briefed on appropriate security 
procedures before they are permitted 
access to TSCA CBI. 

Dated: August 27.1990. 

Linda A. Travers, 

Director, Information Management Division, 

Office of Toxic Substances 

[FR Doc. 90-20732 Filed 8-31-90; 8:45 am) 

billing codc smo-so-f 


DEPARTMENT OF HEALTH AND 
HUMAN SERVICES 

Agency for Toxic Substances and 
Disease Registry 

! ATSDR- 26 ] 

Quarterly Notice of Health 
Assessments To Be Conducted in 
Response to Requests From the Public 
and All Health Assessments 
Completed 

agency; Agency for Toxic Substances 
and Disease Registry (ATSDR), Public 
Health Services (PHS), Department of 
Health and Human Service (DHHS). 
action: Notice. 


summary: This notice contains a list of 
sites for which ATSDR has completed or 
amended health assessments during 
April-June 1990. This list includes sites 
that are on. or proposed for inclusion on. 
the National Priorities list (NPL) and 
non-NPL sites for which ATSDR has 
prepared a health assessment in 
response to a request from the public 
(petitioned health assessment). This 
notice also contains a list of sites for 
which ATSDR. during the same period, 
has accepted a request from the public 
to conduct a health assessment. 
Acceptance is based on a determination 
by the Agency that there is a reasonable 


basis for conducting a health 
assessment at the site. 

FOR FURTHER INFORMATION CONTACT: 

Robert C. Williams, P.E.. Director, 
Division of Health Assessment and 
Consultation. Agency for Toxic 
Substances and Disease Registry, 1600 
Clifton Road, Atlanta, Georgia 30333, 
(404) 639-0610. FTS 236-0610. 
SUPPLEMENTARY INFORMATION: A list of 
completed or amended health 
assessments and petitioned health 
assessments which were accepted by 
ATSDR during January-March 1990 was 
published in the Federal Register on 
Friday, May 18.1990 (55 FR 20636). The 
quarterly announcement is ATSDR’s 
responsibility under the ATSDR new 
regulation. Health Assessments and 
Health Effects Studies of Hazardous 
Substances Releases and Facilities. The 
final rule, wrhich seta forth procedures 
for ATSDR in the conduct of health 
assessments under CERCLA, appeared 
in the Federal Register on Tuesday, 
February 13.1990 (55 FR 5136 to be 
codified at 42 CFR part 90). 

Health Assessments Completed or 
Amended for NPL Sites 

Health assessments for the NPL sites 
listed below were completed or 
amended between April 1,1990, and 
June 30.1990: 

California 

Crazy Horse Sanitary Landfill—Salinas 
Connecticut 

Cheshire Associates Property—Cheshire 
Durham Meadows—Durham 
Linemaster Switch Corporation— 
Woodstock 

Delaware 

Kent County Landfill—Houston 
Sealand Limited—Mt. Pleasant 

Florida 

Agrico Chemical Company—Pensacola 
Beulah Landfill—Pensacola 
Madison County Sanitary Landfill— 
Madison 

Standard Auto Bumper Corporation— 
Hialeah 

Wilson Concepts of Florida. Inc.— 
Pompano Beach 

Woodbury Chemical (Princeton Plant)— 
Princeton 

Georgia 

T.H. Agriculture & Nutrition Company— 
Albany 

Illinois 

Acme Solvent Reclaiming. Inc.— 
Morristown 


Iowa 

E.I. DuPont DeNemours Company, 
County Rd. X23—West Point 
Mid-America Tanning Company— 
Sergeant Bluff 

Shaw Avenue Dump (preliminary health 
assessment)—Charles City 
Shaw Avenue Dump 2 (full health 
assessment)—Charles City 
U.S. Nameplate—Mount Vernon 

Kansas 

Pester Refinery Company—F.1 Dorado 

Kentucky 

Brantley Landfill—Island 
Fort Hartford Coal Company Stone 
Quarry—Olaton 
General Tire/Rubber—Mayfield 

Maryland 

Anne Arundel County Landfill—Glen 
Bumie 

Massachusetts 

Atlas Tack Corporation—Fairhaven 
Iron Horse Park—Billerica 

Mississippi 

Gautier Oil Company. Inc.—Gautier 
Missouri 

Oronogo-Duenweg Mining Belt—Jasper 
County 

Syntex Facility—Verona 
New Hampshire 

Fletchers Paint Works and Storage— 
Milford 

Holton Circle Ground Works 
Contamination—Londonderry 
Savage Municipal Well 1—Milford 
South Municipal Water Supply Well— 
Petersborough 

New Jersey 

Brick Township Landfill—Brick 
Township 

Dayco Corporation/LE. Carpenter 
Company—Wharton Borough 
Dover Municipal Well 4 —Dover 
Township 

Ellis Property—Evesham Township 
Hopkins Farm—Plumstcad Township 
King of Prussia—Winslow Township 
Landfill and Development Company— 
Mount Holly 

Lodi Municipal Wellfield—Lodi 
Monitor Devices/Intercircuits, Inc.— 

Wall Township 

Myers Property 2—Franklin Township 
Price Landfill—Pleasantvilie 
Rockaway Township Wells—Rockaway 
Upper Deerfield Township Sanitary 
Landfill—Upper Deerfield Township 
Vineland State School—Vineland 
Wilson Farm—Plumstead Township 














Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Notices 


35957 


New Mexico 

Cimarron Mining Corporation— 
Carrizozo 

Cleveland Mill—Silver City 
Prewitt Abandoned Refinery—Prewitt 

New York 

Forest Glen Mobile Home Park— 
Niagara Falls 

North Carolina 

New Hanover Company Airport Burn 
Pit—Wilmington 

Oklahoma 

Double Eagle Refinery Company— 
Oklahoma City 

Moseley Road Sanitary Landfill— 
Oklahoma City 

Pennsylvania 

Berkley Products Company Dump— 
Denver 

Raymark—Hatboro 
Tennessee 

Carrier Air Conditioning Company— 
Collierville 

Murray-Ohio Manufacturing (Horseshoe 
Bend)—Lawrenceburg 
Wrigley Charcoal Plant—Wrigley 

Texas 

Rio Grande Oil Company Refinery— 
Sour Lake 

Tex-Tin Corporation—Texas City 
Vermont 

Darling Hill Dump—Lyndonville 

Washington 

ALCOA (Vancouver Smelter)— 
Vancouver 

American Crossarm & Conduit 
Company—Chehalis 
Centralia Muncipal Landfill—Centraiia 
General Electric (Spokane Shop)— 
Spokane 

Tosco Corporation (Spokane 
Termina 1)—Spokane 
Yakima Plating company—Yakima 

Wyoming 

Mystery Bridge Road/U.S. Highway 
20 —Evansville 

Petitions for Health Assessments 
Accepted 

Between April 1, 1990. and June 30. 
1990. ATSDR determined that there was 
a reasonable basis to conduct health 
assessments for the sites or facilities 
listed below in response to requests 
from the public. As of June 30.1990. 
ATSDR had initiated health 
assessments at these sites or facilities: 
Buzby Brothers Landfill—Vorhees. New 
Jersey 

Fields Brook Site—Ashtabula. Ohio 


Groton Gratuity Road—Groton. 
Massachusetts 

Huntington Landfill—Huntington. New 
York 

Lackawanna Valley Area—Scranton, 
Pennsylvania 

Availability: The completed health 
assessments are available for public 
inspection at the Division of Health 
Assessment and Consultation. Agency 
for Toxic Substances and Disease 
Registry. Building 31. Executive Park 
Drive, Atlanta, Georgia (not a mailing 
address), between 8 a.m. and 4:30 p.m., 
Monday through Friday except legal 
holidays. On or about August 31,1990. 
the completed health assessments will 
be available by mail through the U.S. 
Department of Commerce. National 
Technical Information Service (NTJS), 
5285 Port Royal Road, Springfield. 
Virginia 22161 or by phone at (703) 487- 
4650. 

Dated: August 27,1990. 

William L. Roper, 

Administrator, Agency for Toxic Substances 
and Disease Registry. 

[FR Doc. 90-20713 Filed 8-31-90; 8:45 am) 
BILLING COOE 4 ♦•0-70-41 


Centers for Disease Control 

National Institute for Occupational 
Safety and Health (NIOSH), Centers for 
Disease Control (CDC), Research on 
Agricultural Lung Disease Program: 
Meeting 

name: Research on Agricultural Lung 
Disease Program. 

TIME AND DATE: 8 a.m.-3 p.m., September 
17,1990. 

PLACE: Appalachian Laboratory for 
Occupational Safety and Health, room 
203. NIOSH, CDC. 944 Chestnut Ridge 
Road. Morgantown. West Virginia 
26505. 

STATUS: Open to the public, limited only 
by the space available. 

PURPOSE: To review the research 
program in the Division of Respiratory 
Disease Studies, NIOSH related to 
agricultural lung disease. 

CONTACT PERSON FOR ADDITIONAL 
information: Stephen A. Olenchock, 
Ph.D., NIOSH. CDC. 944 Chestnut Ridge 
Road. Mailstop 215, Morgantown. West 
Virginia 26505, telephone 304/291-4250 
or FTS 923-4256. 

Dated: August 2a 1990. 

Elvin Hilyer, 

Associate Director for Policy Coordination, 
Centers for Disease Control. 

(FR Doc. 90-20712 Filed 8-31-90. 8:45 am] 

BUXJMQ COOE 41*0- IB-41 


Food and Drug Administration 

Statement of Organization, Functions, 
and Delegations of Authority 

Part H. chapter HF (Food and Drug 
Administration) of the Statement of 
Organization, Functions, and 
Delegations of Authority for the 
Department of Health and Human 
Services (35 FR 3685. February 25.1970, 
as amended most recently in pertinent 
parts at 45 FR 33729. May 20. 1980, 50 FR 
51606, December 18.1985 and 55 FR 
30984, July 30,1990) is amended to 
reflect organizational and functional 
changes in the Food and Drug 
Administration. 

The Office of Information Resources 
Management (OIRM) was established 
effective July 10,1990, and was 
published in the Federal Register on July 
30.1990. However, incorrect 
Organizational Codes (Standard 
Administrative Codes) were identified 
at that time. The corrected codes are 
listed below. 

Section HF-B, Organization and 
Functions is amended as follows: 

1. Delete subparagraph (h-5) 

Parklawn Computer Center (lfFA79) in 
its entirety and insert a new 
subparagraph (h-5) Office of 
Information Resources Management 
HFA71) reading as follows: 

(h-5) Office of Information Resources 
Management (HFA71). Performs Agency 
information resources management 
functions. 

Advises the Commissioner on 
information resources management 
issues. 

Represents the Agency to the Office of 
the Assistant Secretary for Health and 
the Office of the Secretary on 
information resources management. 

Manages the Parklawn Computer 
Center. 

Serves as the DIIHS Executive Agent 
for Departmentwide connectivity. 

2. Delete subparagraph (h-8) Division 
of Information Resources Management 
(HFA73) in its entirety. 

Dated: August 16,1990. 

James S. Benson. 

Acting Commissioner of Food and Drugs. 

[FR Doc. 90-20715 Filed 6-31-90; 6:45 am| 

BILUNG CODE 4t«0-01-« 


Health Care Financing Administration 

Privacy Act of 1974 

agency: Department of Health and 
Human Services (HHS), Health Care 
Financing Administration (11CFA). 
action: Notice of New System Records. 












35958 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


summary: In accordance with the 
requirements of the Privacy Act of 1974, 
we are proposing to establish a new 
system of records, called “Current 
Beneficiary Survey (CBS),” HHS/ 
HCFA/OACT No. 09-70-0002. We have 
provided background information about 
the proposed new system in the 
“Supplementary Information" section 
below. Although the Privacy Act 
requires only that the “routine uses" 
portion of the system be published for 
comment, HCFA invites comments on 
all portions of this notice. 
dates: HCFA filed a new system report 
with the Chairman of the Committee on 
Government Operations of the House of 
Representatives, the Chairman of the 
Committee on Governmental Affairs of 
the Senate, and the Administrator, 

Office of Information and Regulatory 
Affairs, Office of Management and 
Budget (OMB), on August 30,1990. The 
new system of records, including routine 
uses, will become effective 60 days from 
the date submitted to OMB unless 
11CFA receives comments which require 
alteration to the system. 

ADDRESSES: The public should address 
comments to Richard A. Demeo, HCFA 
Privacy Act Officer, Office of Budget 
and Administration, Health Care 
Financing Administration, Room 108. 
Security Office Park Building, 7008 
Security Boulevard, Baltimore, 

Maryland 21207. Comments received 
will be available for inspection at this 
location. 

FOR FURTHER INFORMATION CONTACT: 

Mr. Gerald Adler, Project Officer, 
Current Beneficiary Survey, Health Care 
Financing Administration, Office of the 
Actuary, 6325 Security Boulevard, 
Baltimore, Maryland 21207, 301-966- 
7938. 

SUPPLEMENTARY INFORMATION: The 

Current Beneficiary Survey (CBS) is an 
ongoing, multi-purpose survey for use by 
all components of HCFA, by the 
Department, and by others concerned 
with Medicare policy. The core of the 
CBS concept is a series of interviews of 
a representative sample of the Medicare 
population regarding: their patterns of 
use and cost of health services over 
time; their sources of coverage and 
payment; their assets and income; their 
demographic characteristics; their health 
and functional status; their health and 
work history; and their family support. 
The CBS is thus focused on issues that 
are of prime importance to HCFA: 
health care use and expenditure, and 
determinants thereof. The CBS is also 
continuous, in the sense that the same 
beneficiaries will be interviewed 
repeatedly over seveal years to observe 
changes ip health care use with changes 


in coverage, and to observe processes 
that occur over time, such as 
institutionalization or spending down of 
assets. The CBS will provide rapid 
feedback of information to HCFA 
policymakers. Analysis staff will be able 
to answer questions as they arise, rather 
than several years later. The CBS will 
also be designed to permit the use of 
supplementary questions concerning 
fast-breaking issues. The information 
from CBS will be augmented by being 
linked to HCFA data and other 
administrative data to provide 
validation and greater analytic capacity. 

CBS questions to be asked include 
certain core items. These questions, 
which will be asked each round, include: 

• Detailed questions about the 
respondent’s health care utilization 
since the last interview, including 
hospital stays, hospital outpatient care, 
physician visits, home health care, 
nursing home care, drugs, equipment, 
and other utilization categories; 

• The reasons for each utilization 
episode; 

• Expenditures associated with each 
episode, and sources of payment; and 

• Insurance coverage and sources of 
payment, including out-of-pocket costs; 

The following are examples of how 
the core items of the CBS will be used: 

• Estimate the cost of legislative 
proposals; 

• Prepare mandated Reports to 
Congress; 

• Develop national cost estimates for 
health care, including HCFA program 
expenditures, other sources of payment, 
and developments in the health care 
industry; 

• Analyze the effects of program 
changes on use and expenditures, 
including public costs, private insurance, 
and out-of-pocket costs; 

• Improve the actuarial estimates 
which are required to monitor and 
project the demands on the Medicare 
Trust Funds; 

• Study the interaction of the 
Medicare and Medicaid programs, and 
of both programs with private insurance 
derived from employment; 

• Determine the proportion of out-of- 
pocket payments and balance billing for 
physician care; 

• Estimate the role of supplemental 
insurance, including long term care 
insurance, in the Medicare population; 

• Better understand the demographic 
and socio-economic characteristics of 
the Medicare population as they relate 
to its need for health services; and 

• Improve models of use and cost of 
health services. 

In addition to the core items, periodic 
or one-time supplemental questions will 


be included in each of the three rounds 
of interviews occurring during a year. 
These will collect information on 
relatively stable characteristics of the 
respondents, such as work history, or on 
special topics of timely concern to 
HCFA, sucH as respondents* perceptions 
of Health Maintenance Organizations 
(HMOs). They may also contain 
questions which need not be asked each 
round, but may be asked annually, such 
as health and functional status, income, 
assets, living arrangements, family 
supports, and quality of life. These 
supplemental questions will be used to 
address such issues as: 

• Effectiveness of Medicare in 
providing access to needed care; 

• Outcomes of medical care episodes; 

• Effect on working and work history 
on the need for health services and on 
coverage; 

• Effects of Medicare hospitalization 
on post-hospital outcomes of care; 

• Efficacy of Medicare in improving 
or maintaining health status for 
Medicare beneficiaries; 

• State of beneficiary knowledge 
about developments in the program and 
the effects of HCFA*s communications 
for various types of beneficiaries; 

• Beneficiaries* understanding of 
HMOs and other forms of managed care; 

• Understanding of the proper use of 
the dispensed drug, and drug 
interactions; and 

• Beneficiaries* perceptions of 
physician services provided under 
Medicare, especially their understanding 
of the Participating Physician Program. 

The CBS sample will consist of 12,000 
individuals sampled from the Medicare 
Enrollment File to be representative of 
the Medicare population as a whole and 
by age group, enrollment type (aged or 
disabled), urban or rural residence. 
Census region, and, among the aged, 
whether or not institutionalized. The 
sample will be augmented several times 
a year to take into account attrition, as 
well as to include eligible persons. 

Sampled individuals will be 
interviewed three times a year, using 
personal interviews for the entire 
sample for the first round and altering 
personal and telephone interviews 
thereafter. People who are unable to 
respond by phone will be interviewed 
personally each time. These interviews, 
conducted three times a year, will yield 
a time series of data for each respondent 
on health services utilization, medical 
care expenditures, health insurance 
coverage, sources of payment, public 
and private, including out-of-pocket 
payments, health and functional status, 
and a variety of demographic and 
behavioral information (such as income. 







Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Notices 


35959 


assets, living arrangements, family 
supports, and quality of life). 

Built into the survey design are 
requirements for reporting access to the 
data in a variety of media, a series of 
validations of the data, and rapid 
turnaround. Survey data files will be 
matched to HCFA claims payment and 
other administrative records such as the 
National Death Index, Social Security 
records, and the Area Resource File. A 
CBS Data Book is to be prepared 
annually for wide circulation, presenting 
the most important tabulations. State 
and local area estimates, and the 
relation of CBS data to other findings on 
the Medicare population. The CBS Data 
Book will not contain any information 
which allows individuals participating 
in the survey to be identified. Annual 
extracts of the data will be prepared, 
suitable for analysis on personal 
computers. 

Interviewing will begin at the start of 
the second year of the contract 
expected to be January 1,1991. It is 
estimated that the average interview, 
including supplements, will be 45 
minutes to an hour in duration, although 
interviews will vary due to the presence 
or absence of health events. It is 
intended that, after testing, recently 
developed computer technology will be 
used for data collection, that is. the 
Computer Assisted Personal Interview 
(CAPI), in order to obtain timely, clean, 
and high quality data. 

During the first year, the contractor 
will conduct a full-scale pilot test of all 
forms and procedures to be used in the 
CBS, including sample selection, 
selection and training of data collection 
staff, data collection, quality control, 
and processing and delivery of the data. 
The purposes of the pilot test are to (1] 
test respondent sampling, contact, and 
location procedures; (2) test 
questionnaire content, wording, and 
format; (3) test software and 
programming for CAP!; (4) test 
interviewer instruction materials and 
training in CAPI; (5) test data 
transmission, editing and processing 
procedures; (6) test coding, summary 
and control card preparation, and output 
preparation; (7J evaluate training 
methods, material, end procedures; and 
(8) evaluate the burden on respondents, 
especially on impaired individuals. 

The CBS is guided by a technical 
advisory panel (TAP) of 12 experts, hair 
from inside and half from outside the 
government. The TAP advises the 
Project Officer on the conduct of the 
survey and the analysis of survey data 
At its first meeting the TAP rev iewed 
the contractor’s work plan and draft 
questionnaire and began the 
development of an analysis plan for CBS 


data. Future meetings will review 
reports for each of the three data 
collection rounds, annual estimate 
reports, the CBS Data Book, and 
successive Work Pians. 

The Privacy Act permits us to disclose 
information without the consent of 
individuals for -routine uses”—that is, 
disclosures that are compatible with the 
purpose for which we collected the 
information. The proposed routine uses 
in the new system meet the 
compatibility criteria since the 
information is collected to produce 
estimates of health care use and 
expenditures, and determinants thereof, 
by the aged and disabled. We anticipate 
the disclosures under the routine uses 
will not result in any unwarranted 
adverse effects on persona! privacy. 

Dated: August 27. 1990. 

Gail R. Wikmsky. 

A dm in isttutor, Heatth Cure Financing 
Administration. 

09-70-6002 

SYSTEM NAME: 

A Current Beneficiary Survey (CBS). 
HHS/HCFA/OACT. 

SECURITY CLASSIFICATION: 

None. 

SYSTEM location: 

Office of Computer Operations, 

BDMS, HCFA, 6325 Security Boulevard. 
Baltimore. Maryland 21207. 

CATEGORIES or INDIVIDUALS COVEREO BY THE 

system: 

A scientific random sample of persons 
enrolled for hospital insurance and/or 
supplemental medical benefits under the 
Medicare program. 

CATEGORIES OF RECORDS IN THE SYSTEM: 

Demographic and socioeconomic 
characteristics such as age, sex, race, 
education, military service history, 
income, and marital status; medical 
utilization and cost data; prescription 
drug usage and cost data; health and 
functional status data; health insurance 
coverage data; personal identifiers 
(name of Medicare beneficiary and 
Medicare health insurance claim 
number); medical condition data; 
household composition data: medical 
provider names. 

AUTHORITY FOR MAINTENANCE OF THE 

system: 

Authority for maintenance of the 
system is given under section 1875 of the 
Social Security Act (42 U.S.C 139511), 
entitled Studies and Recommendations. 


purpose of the system: 

The survey will produce data sets 
suitable for both longitudinal and cross- 
sectional analysis. These data will be 
used by HCFA for multiple purposes to; 

• Produce projections of current 
program and proposed program changes; 

• Produce U.S.-level estimates of 
national health care expenditures by the 
aged and disabled; 

• Provide a research data base for 
HCFA and other researchers; and 

• Provide guidance to program 
management and policies. 

ROUTINE USES OF RECORDS MAINTAINED IN 
THE SYSTEM, INCLUDING CATEGORIES OF 
USERS AND THE PURPOSES OF SUCH USES: 

Disclosure may be made: 

1. To a congressional office from the 
record of an individual in response to an 
inquiry from the congressional office 
made at the request of that individual. 

2. To the Bureau of Census for use in 
processing research and statistical data 
directly related to the administration of 
programs under the Social Security Act. 

3. To the Department of Justice, to a 
court or other tribunal, or to another 
party before such tribunal, when 

(a) HHS, or any component thereof: or 

(b) Any HHS employee in his or her 
official capacity; or 

(c) Any HHS employee in his or her 
individual capacity where the 
Department of Justice (or HHS where it 
is authorized to do so) has agreed to 
represent the employee; or 

(d) The United States or any agency 
thereof where HHS determines that the 
litigation is likely to affect HHS or any 
of its components; 

ia party to litigation or has an interest in 
such litigation, and HHS determines that 
the use of such records by the 
Department of Justice, the tribunal, or 
the other party is relevant and 
necessary to the litigation and would 
help in the effective representation of 
the governmental party, provided, 
however, that in each case HIIS 
determines that such disclosure is 
compatible with the purpose for which 
the records were collected. 

4. To an individual or organization for 
a research, evaluation, or 
epidemiological project related to the 
prevention of disease or disability, or 
the restoration or maintenance of health 
if HCFA: 

a. Determines that the use or 
disclosure does not violate legal 
limitations under which the record was 
provided, collected or obtained: 

b. Determines that the purpose for 
which the disclosure is to be made: 

(1) Cannot be reasonably 
accomplished unless the record is 








35980 


Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Notices 


provided in individually identifiable 
form. 

(2) Is of sufficient importance to 
warrant the effect and/or risk on the 
privacy of the individual that additional 
exposure of the record might bring, and 

(3) There is reasonable probability 
that the objective for the use would be 
accomplished. 

c. Requires the information recipient 
to: 

(1) Establish reasonable 
administrative, technical, and physical 
safeguards to prevent unauthorized use 
or disclosure of the record, and 

(2) Remove or destroy the information 
that allows the individual to be 
identified at the earliest time at which 
removal or destruction can be 
accomplished consistent with the 
purpose of the project unless the 
recipient presents an adequate 
justification of a research or health 
nature for retaining such information, 
and 

(3) Make no further use or disclosure 
of the record except: 

(a) In emergency cicumstances 
affecting the health or safety of any 
individual. 

(b) For use in another research 
project, under these same conditions, 
and with written authorization of HCFA, 

(c) For disclosure to a properly 
identified person for the purpose of an 
audit related to the research project, if 
information that would enable research 
subjects to be identified is removed or 
destroyed at the earliest opportunity 
consistent with the purpose of the audit 
or 

(d) When required by law; 

d. Secures a written statement 
attesting to the information recipient’s 
understanding of and willingness to 
abide by these provisions. 

5. To a contractor for the purpose of 
collating, analyzing, aggregating or 
otherwise refining or processing records 
in this system or for developing, 
modifying and/or manipulating ADP 
software. Data would also be disclosed 
to contractors incidental to consultation, 
programming, operation, user 
assistance, or maintenance for an ADP 
or telecommunications systems 
containing or supporting records in the 
system. 

POLICIES AND PRACTICES FOR STORING, 
RETRIEVING, ACCESSING, RETAINING, AND 
DISPOSING OF RECORDS IN THE SYSTEM: 

STORAGE: 

File folders, magnetic tapes, computer 
disks. 

RETRIEV ABILITY: 

Records are retrieved by health 
insurance claim number. 


SAFEGUARDS: 

Access is limited to authorized HCFA 
personnel and HCFA contractor 
employees in the performance of their 
duties. HHS contractors and 
collaborating researchers are required to 
comply with the provisions of the 
Privacy Act, and are required to sign 
Assurance of Confidentiality Forms (or 
Data Security Statements) that are kept 
on file by the contractor. Respondents 
are advised that their identity will only 
be known to those who are involved in 
conducting the study and that any 
published findings will be in a formal 
which precludes individual 
identification (data that contains no 
individual identifiers nor data elements 
that would permit the identity of a 
beneficiary to be deduced [e.g., date of 
birth, residence, zip code) may be 
released as statistical data). Data are 
kept in secured rooms with access 
limited to authorized personnel, in 
buildings with controlled access. Access 
to computer files is controlled by the use 
of security codes and passwords known 
only to authorized personnel. 

RETENTION AND DISPOSAL.* 

Records are maintained with 
identifiers as long as needed for 
program research. 

SYSTEM MANAGER(S) AND ADDRESS: 

Chief Actuary, Office of the Actuary, 
Health Care Financing Administration. 
6325 Security Boulevard, Baltimore. 
Maryland 21207 

NOTIFICATION PROCEDURE: 

For purpose of access, write the 
system manager, who will require the 
system name, health insurance claim 
number, and, for verification purposes, 
name, address, date of birth, and sex. 

RECORD ACCESS PROCEDURE: 

Same as notification procedures. 
Requestors should also reasonably 
specify the record contents being sought. 
(These access procedures are in 
accordance with the Department 
Regulations [45 CFR 5b.5(a)2).j 

CONTESTING RECORD PROCEDURES: 

Contact the system manager named 
above, and reasonably identify the 
record and specify the information to be 
contested. State the corrective action 
sought and the reasons for the 
correction with supporting justification. 
(These procedures are in accordance 
with Department Regulation [45CFR 
5b.7).). 

RECORD 80URCE CATEGORIES: 

Medicare enrollment records; 

Medicare bill records; Medicare 
provider records for a sample of 


enrollecs; Medicare beneficiaries or 
proxies; Medical providers (such as 
physicians, medical facilities, home 
health care providers) for a sample of 
enrollecs. 

SYSTEMS EXEMPTED FROM CERTAIN 
PROVISIONS OF THE ACT: 

None. 

[FR Doc. 90-20699 Filed 8-31-90: 8:45 am| 

BILLING CODE 4120-03-M 


National Institutes of Health 

National Cancer Institute, Meeting; 
Cancer Biology—Immunology 
Contracts Review Committee 

Pursuant lo Public Law 92-463, notice 
is hereby given of the meeting of the 
Cancer Biology-Immunology Contracts 
Review Committee, National Cancer 
Institute, National Institutes of Health, 
September 14,1990, Chevy Chase 
Holiday Inn, Palladian West Room. 5520 
Wisconsin Avenue, Chevy Chase, 
Maryland 20815. 

This meeting will be open to the 
public on September 14 from 9 a.m. to 10 
a.m. to discuss administrative details. 
Attendance by the public will be limited 
to space available. 

In accordance with provisions set 
forth in secitons 552b(c)(4) and 
552b(c)(6), title 5. U.S.C. and section 
10(d) of Public Law 92-463, the meeting 
will be closed to the public on 
September 14 from 10 a.m. to 
adjournment for the review, discussion 
and evaluation of individual contract 
proposals. These proposals and the 
discussions could reveal confidential 
trade secrets or commercial property 
such as patentable material and 
personal information concerning 
individuals associated with the 
proposals, disclosure of which would 
constitute a dearly unwarranted 
invasion of personal privacy. 

The Committee Management Officer, 
National Cancer Institute, Building 31. 
Room 10A06, National Institutes of 
Health, Bethesda, Maryland 20892 (301/ 
496-5708) will provide summaries of the 
meeting and rosters of committee 
members upon request. 

Dr. Lalita D. Palekar, Executive 
Secretary', Cancer Biology-Immunology 
Contracts Review Committee, 5333 
Westbard Avenue, Room 805, Bethesda, 
Mary land 20892 (301/496-7575) wiP 
furnish substantive program 
information. 







Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Notices 


35961 


Dated: August 23,1990. 

Betty J. Beveridge, 

Committee Management Officer, NIH. 

[FR Doc. 90-20686 Filed 8-31-90; 8:45 am] 

81 LUNG CODE 4140-01-11 


Public Health Service 

Request for Nominations for Voting 
Members on National Vaccine 
Advisory Committee 

agency: Public Health Service, HHS. 
action: Notice. 

summary: The Department of Health 
and Human Services (DHHS) is 
requested nominations to fill four 
vacancies on the National Vaccine 
Advisory Committee. The Committee 
advises the National Vaccine Program 
and was established by title XXI, 
subtitle I. section 2105 of the Public 
Health Service Act, enacted by Public 
Law 99-660, The National Vaccine 
Injury Compensation Act of 1986 (42 
U.S.C. 300AA-1 et seq.) 
dates: Nominations are to be submitted 
by October 1,1990. 
addresses: All nominations for 
membership should be sent to Dr. Yuth 
Nimit (address below). 

FOR FURTHER INFORMATION CONTACT: 
Yuth Nimit, Ph.D., Executive Secretary, 
National Vaccine Advisory Committee, 
National Vaccine Program, Office of the 
Assistant Secretary for Health, room 
13A-53, Parklawn Building. 5600 Fishers 
Lane, Rockville, Maryland 20857, (301) 
443-0715; Fax number: (301) 443-3386. 
SUPPLEMENTARY INFORMATION: The 
National Vaccine Program is requesting 
nominations of voting members for four 
vacancies on the National Vaccine 
Advisory Committee. Nominated 
individuals should have expertise in 
vaccine research or the manufacture of 
vaccines, or should be physicians, or 
members of parent organizations 
concerned with immunization, or 
representatives of State or local health 
agencies, or public health organizations. 
Members will be invited to serve four 
year terms. 

The National Vaccine Advisory 
Committee (1) studies and recommends 
ways to encourage the availability of an 
adequate supply of safe and effective 
vaccination products in the United 
States, (2) recommends research 
priorities and other measures the 
Director of the Program should take to 
enhance the safety and efficacy of 
vaccines, (3) advises the Director of the 
Program in the implementation of 
sections 2102, 2103, and 2104 of the 


Public Health Service Act, and (4) 
identifies annually for the Director of 
the Program the most important areas of 
government and nongovernment 
cooperation that should be considered 
in implementing these sections. 

In keeping with normal departmental 
policy, nominees generally should not 
currently be serving on another DHHS 
advisory committee, although 
exceptions will be considered. 

DHHS has a special interest in 
ensuring that women, minority groups, 
and the physically handicapped are 
adequately represented on advisory 
committees. Final selection will be 
determined by the expertise of the 
candidates and in a manner to ensure 
appropriate balance of Membership. 
NOMINATION PROCEDURES: Any 
interested person may nominate one or 
more qualified persons for membership 
on the National Vaccine Advisory 
Committee. The nominee should be 
aware of the nomination, willing to 
serve as a member of the committee and 
appear to have no conflict of interest 
that would preclude committee 
membership. A curriculum vitae of the 
nominee should be submitted with the 
nomination. 

Dated: August 17,1990. 

James O. Mason, 

Assistant Secretary for Health. 

[FR Doc. 90-20714 Filed 8-31-90; 8:45 am| 

BILLING CODE 4160-17-M 


National Toxicology Program, National 
Toxicology Program; Announcement 
of Intent To Conduct Long-term 
Toxicological Studies of Five 
Chemicals; Request for Comments 

As part of an effort to inform the 
public, the National Toxicology Program 
(NTP) routinely announces in die 
Federal Register the lists of chemicals 
for which it intends to conduct long-term 
toxicological studies. This 
announcement will allow interested 
parties to comment and provide 
information on chemicals under 
consideration for long-term toxicology 
and carcinogenesis studies. 

1. Coconut oil fatty acids 
diethanolamine, 2:1 condensate (68603- 
42-9)—13-week and 2-year studies via 
skin application in B6C3F1 mice and 
F344 rats. 

2. N,N-Di(2-hydroxyethyl)lauramide 
(120—10-1)—13-week and 2-year studies 
via skin application in B6C3F1 mice and 
F344 rats. 

3. N,N-Di(2-hydroxyethyl)oleamide 


(13961-86-9)—13-week and 2-year 
studies via skin application in B6C3F1 
mice and F344 rats. 

4. Anthraquinone (84-65-1)—13-week 
and 2-year studies via dosed feed in 
B6C3F1 mice and F344 rats. 

5. Furfuryl alcohol (98-00-0)—2-year 
studies via inhalation exposure in 
B6C3F1 mice and F344 rats. 

Anyone having relevant information 
(including ongoing toxicological studies, 
current or future trends in production 
and import, use pattern, human 
exposure levels, and toxicological data) 
to share with the NTP on any of these 
chemicals, should contact Dr. William 
Eastin within 60 days of the appearance 
of this announcement. The information 
provided will be considered by the NTP 
in designing these studies. 

Contact may be made by mail to: Dr. 
William Eastin. NIEHS/NTP. P.O. Box 
12233, Research Triangle Park, North 
Carolina 27709 or by telephone at 919- 
541-7941. 

Dated: August 28,1990. 

David P. Rail, 

Director, National Toxicology Program. 

[FR Doc. 90-20665 Filed 8-31-90; 8:45 am] 
BILUNG CODE 4140-01-M 


DEPARTMENT OF THE INTERIOR 

Bureau of Land Management 

[ ID-050-00-1520-101 

Date for a Meeting of the Shoshone 
District Advisory Council; 

Rescheduled to a Later Date 

AGENCY: Bureau of Land Management 
[BLM], Interior. 

action: Notice of date change for 
district advisory council meeting. 

summary: This notice changes the date 
of the meeting from September 27,1990 
to October 11,1990, previously 
published in the Federal Register August 
23,1990, [55 FR 3462] to set forth the 
schedule and proposed agenda for a 
meeting of the Shoshone District 
Advisory Council. 

The remainder of the previously 
published Notice remains unchanged. 

Dated: August 23,1990. 

Janis VanWyhe, 

Associate District Manager. 

[FR Doc. 99-20488 Filed 8-31-90; 8:45 am] 

BILLING CODE 4310-GG-M 












35962 


Federal Register / VoL 55, No. 171 / Tuesday, September 4, 1990 / Notices 


Fish and Wildlife Service 

Withdrawal of Draft Environmental 
Impact Statement on Management of 
the National Wildlife Refuge System 
and Intent To Prepare a New 
Combined Management Plan and 
Environmental impact Statement 

agency: Fish and Wildlife Service, 
Interior. 

action: Notice. 

summary: The U.S. Fish and Wildlife 
Service (Service) has withdrawn the 
draft of a programmatic environmental 
impact statement (EIS) on the 
management of the National Wildlife 
Refuge System (NWRS) and begun the 
preparation of a new, more 
comprehensive document. The new 
combined management plan and EIS 
will be titled “Refuges 2003—A Plan for 
the Future*' (Refuges 2003). the date 
coinciding with the 100th anniversary of 
the establishment of the first national 
wildlife refuge in 1903. This Notice 
advises the public that all comments 
received on the withdrawn draft EIS will 
be considered in the preparation of the 
new combined management plan and 
EIS. Moreover, to allow for additional 
opportunities for public input and 
participation in the preparation of the 
new document, a series of public 
meetings and workshops will be held 
throughout the country. 

FOR FURTHER INFORMATION CONTACT: 
Robert Pacific, Division of Refuges. U.S. 
Fish and Wildlife Service. Mail Stop 670 
ARLSQ, 1849 C Street. NW., 

Washington, DC 20240. 

SUPPLEMENTARY INFORMATION: On 
December 12,1988 (53 FR 49931). the 
Service announced the availability, for 
public review and comment, of a draft 
EIS for the management of the NWRS 
pursuant to section 102(2)(C) of the 
National Environmental Policy Act of 
1969 (NEPAJ. The statement described 
four alternatives for managing national 
wildlife refuges and the environmental 
consequences of implementing each 
alternative. A broad range of significant 
concerr.3 was expressed by many of the 
over 33,000 comments received by the 
Service in response to that 
announcement. 

After careful review and analysis of 
the substantive comments, the decision 
was made to withdraw the draft EIS and 
prepare a new document. Refuges 2003. 
for public review and comment prior to 
preparing a final EIS. Refuge 


management issues raised by those who 
commented on the draft EIS will be 
more fully addressed in the new 
document. These issues will include: 

4 Management of Nongame Species 

* The Compatibility Process 

* Economic Uses on Refuge Lands 

* Role of Hunting and Trapping as 
Management Tools 

* Recreational Activities on Refuges 

* Land Acquisition Needs/Priorities 

* Use of Pesticides 

* Predator Management 

* Management and Designation of Special 
Management Areas (e.g. Reserach Natural 
Areas, Wilderness Areas, Wild and Scenic 
Rivers) 

* Habitat Management 

* Protection of Biological Diversity 

* Enhancement of Environmental Education 
Opportunities 

* Enhancement of Fisheries Programs 

* Environmental Contaminants 

* Water Issues (e g. Federal Water Rights, 
Water Quantity and Quality) 

* Management of Threatened and 
Endangered Species 

* Waterfowl Management 

Refuges 2003 will also address the 
impact of important recent legislation on 
the NWRS, including the Emergency 
Wetlands Resources Act of 1986, the 
Farm Dill and the North American 
Wetlands Conservation Act of 1988, as 
well as how the NWRS complement the 
“No Net Loss” of wetlands goal. 

In addition, Refuges 2003 will expand 
on the background information 
presented on the NWRS and include a 
greater range of reasonable alternatives 
for the management of the NWRS. The 
schedule for the preparation of the new 
combined management plan and EIS 
will include numerous public meetings 
nationwide. The draft management plan 
and EIS is scheduled to be released in 
December 1991 and the final plan/EIS in 
September 1992. 

The environmental review of this 
project will be conducted in accordance 
with the requirements of the NEPA, as 
amended (42 U.S.C. 4321, et seq.\ NEPA 
Regulations (40 CFR parts 1500-1508), 
other appropriate Federal regulations, 
and Service procedures for compliance 
with those regulations. 

Dated: August 24,1990. 

Bruce Blanchard, 

Acting Director, Fish and Wildlife Service . 

[FR Doc. 90-20723 Filed 8-31-90; 8:45 am) 
BILLING COPE 4310-55-M 


INTERSTATE COMMERCE 
COMMISSION 

I Arndt. No. 1 to Service Order No. 1510) 

D&H Corp. 1 Canadian Pacific LTD. 
Authorized To Operate Tracks of 
Delaware and Hudson Railway Co., 
Debtor (Francis P. DiCeffo, Trustee) 

AGENCY: Interstate Commerce 
Commission. 

action: Amendment No. 1 to Service 
Order No. 1510 extends the order’s 
effectiveness for 90 days as requested 
by Francis P. DiCello, Trustee in 
reorganization of the Delaware and 
Hudson Railway Company (D&H), and 
D&H Corporation/Canadian Pacific 
Limited (D&H Corp./CP Rail. 

summary: Service Order No. 1510, 
issued July 31,1990, pursuant to 49 
U.S.C. 11123(a), authorized D&H Corp./ 
CP Rail to operate without Federal 
subsidy or other Federal compensation 
over tracks of the D&H for 30 days [i.e., 
from, August 1 , 1990 until August 30. 
1990), while the Commission conducted 
the required hearing to considewr 
extension of the authority beyond 30 
days. Service Order No. 1510 is hereby 
extended for 90 days. 

EFFECTIVE DATE: This order shall 
become effective at 11:59 p.m., August 
30,1990, and shall remain in effect until 
11:59 p.m., November 28,1990, unless 
otherwise modified, amended, or 
vacated by order of this Commission. 
FOR FURTHER INFORMATION CONTACT 
Bernard Gaillard, (202) 275-7849, or 
Melvin F. Clemens. (202) 275-1559, (TDD 
for hearing impaired: (202) 275-1721). 
SUPPLEMENTARY INFORMATION: Upon 
application by Francis P. DiCello, 
Trustee in reorganization of the D&H. 
and D&H Corp./CP Rail and based upon 
representations of support by The New 
York State Department of 
Transportation (NYSDOT) and the U.S. 
Department of Transportation, Federal 
Railroad Administration (FRA). Service 
Order No. 1510 was entered, pursuant to 
49 U.S.C. 11123(a), for an initial period of 
30 days. 

All comments received uniformly 
support a continuation of this emergency 
authority. Shippers and the NYSDOT 
base their support on the absence of 


1 D&H Corporation is a wholly owned subsidiary 
of Canadian Pacific Limited that was formed to 
acquire the assets of the Delaware and Hudson 
Railway Company. That acquisition is being 
considered by the Commission in Finance Docket 
No. 31700. 











Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Notices 


35963 


alternative service to many shippers in 
the region served by D&H If D&H Corp. 
is not allowed by this authority to 
continue its emergency operations. 

During the initial period of the order, 
D&H Corp. has demonstrated that with 
support of its parent, CP Rail, it has the 
necessary financial resources and the 
managerial and operational capability to 
provide continued rail service on the 
D&H lines. 

The Commission herein certifies that 
the emergency which prompted entry of 
the original order in this proceeding 
continues and extends the authority for 
D&H Corp./CP Rail to operate D&H 
lines for an additional 90 days. This will 
assure D&H shippers of continued 
essential rail services, without 
interruption, during the pendency of the 
acquisition proceeding (Finance Docket 
No. 31700). 

Additional information is contained in 
the Commission’s decision. To purchase 
a copy of the full decision, write to, call, 
or pick up a copy in person from: 
Dynamic Concepts, Inc., Room 2229, 
Interstate Commerce Commission 
Building, Washington, DC 20423. 
Telephone: (202) 289-4357/4359. 

Decided: August 28.1990. 

By the Commission, Chairman Philbln, Vice 
Chairman Phillips. Commissioners Simmons. 
Lamboley and Emmett. 

Sidney L» Strickland. )r.. 

Secretary. 

|FR Doc. 90-20720 Filed 8-31-90: 8:45 am| 
BILLING CODE 7035-01-M 


(Finance Docket No. 31724] 

Exemption; Columbus & Greenville, 
Railway Co.; Trackage Rights 
Exemption Southrail Corp. 

Southrail Corporation (SR) has agreed 
to grant overhead trackage rights to 
Columbus & Greenville Railway 
Company (C&G) over SR’s main track at 
or near West Point, MS, between the 
switching point with connecting track to 
be constructed 1,087 feet north of SR 
milepost AJ-87 (valuation station 
4595 -r 01) 1 and the point of a direct 
connection to be constructed by C&G 
just south of the intersection of C&G's 
former main track with Mississippi State 
Highway No. 50, a distance of 1.6 miles. * 2 
The trackage rights were to become 
effective on or after August 24,1990. 

This transaction is related to another 
trackage rights agreement whereby C&G 


1 Other connecting tracks to be constructed will 
intersect with the line covered by the trackage 
rights inv olved here at a point 3.067 feet north of SR 
milepost AJ-87 (valuation station 4615 + 01). 

* This construction would involve C&G lining 
over SRs Old Scale Track east of SR’s West Point 
Depot 


will allow SR to operate over its lines. 3 
That transaction also involves 
construction of connecting tracks that 
will allow C&G and SR to use certain of 
each other’s lines in effect as joint 
facilities. 4 

This notice is filed under 49 CFR 
1180.2(d)(7). Petitions to revoke the 
exemption under 49 U.S.C. 10505(d) may 
be filed at any time. The filing of a 
petition to revoke will not stay the 
transaction. Pleadings must be filed with 
the Commission and served on: Lester 
A. Sittler. 137 Main Street, P.O. Box 128, 
Cooperstown, NY 13320. 

As a condition to the use of this 
exemption, any employees affected by 
the trackage rights will be protected 
pursuant to Norfolk and Western Ry. 

Co.—Trackage Rights — BN, 354 I.C.C. 
605 (1978), as modified in Mendocino 
Coast Ry., Inc.—Lease and Operate, 360 
I.C.C. 653 (1980). 

Dated: August 28,1990. 

By the Commission, Richard B. Felder, 
Acting Director, Office of Proceedings. 

Sidney L. Stricland, Jr., 

Secretory. 

[FR Doc. 90-20720 Filed 8-31-90: 8:45 am] 

BILLING CODE 7035-01-41 


DEPARTMENT OF JUSTICE 

Antitrust Division 
(Civil Action No. 90-1986] 

United States v. Brown & Root, Inc., 
Proposed Final Judgment and 
Competitive Impact Statement 

Notice is hereby given pursuant to the 
Antitrust Procedures and Penalties Act, 
15 U.S.C. 16(b)—(h), that a proposed Final 
Judgment, Stipulation, and Competitive 
Impact Statement have been filed with 
the United States District Court for the 
District of Columbia in United States of 
America v. Brown &Root, Inc., 
Halliburton Company, and Offshore 
Pipelines, Inc. 

The Complaint of the United States in 
this case alleges that the acquisition 
from Brown & Root, Inc. (“B&R”) by 
Offshore Pipelines, Inc. (“OPr) may 
substantially lessen competition in the 
provision of pipelay and pipebury barge 


• Finance Docket No. 31719, Southrail 

Corporation—Trackage Rights Exemption — 
Columbus and Greenville Railway Company (not 

printed), corrected notice served and published 
August 24.1990 (55 FR 34777-8). 

4 C&G and SR have not indicated that either of 
them has sought Commission approval for 
construction of the connecting lines. It is unclear 
whether this construction is subject to Commission 
jurisdiction. If the Commission does have 
jurisdiction, they must either file appropriate 
applications under 49 U.S.C 10901 or seek 
exemption under 49 U.S.C 10505. 


services in water depths of 
approximately 200 to 400 feet or with 
pipe diameters greater than 12 inches ir. 
the United States Gulf of Mexico 
(“intermediate pipelay/pipebury 
market”) in violation of section 7 of the 
Clayton Act. 

Pipelay and pipebury barge services 
are contracted for by oil companies to 
install and bury pipeline in connection 
with the offshore development and 
production of crude oil and natural gas 
in the United States Gulf of Mexico. 
Pipelay barges, pipebury barges, and 
combination pipelay/pipebury barges 
are specially designed, built or modified, 
and equipped to be capable of laying 
and/or burying pipeline on the sea 
bottom. Vessels vary in their 
capabilities to lay or bury certain 
diameters of pipe and to do so in certain 
water depths largely based on the size 
of the vessel. Firms that provide 
pipelay/pipebury barge services in the 
United States Gulf of Mexico compete 
with each other for bids. In 1989, total 
sales in the intermediate pipelay/ 
pipebury market were over $20 million, 
with OPI accounting for about 27% of the 
market and B&R accounting for about 
31%. 

The proposed Final Judgment requires 
OPI to divest certain pipelay/pipebury 
vessels—the BAR-278 pipelay/pipebury 
barge and the LB-282 pipelay/pipebury 
barge, by March 15,1991. If OPI does not 
sell these assets by then, a trustee will 
be appointed to conduct the divestiture. 

Public comment on the proposed Final 
Judgment is invited within the statutory 
60-day comment period. Such comments, 
and responses thereto, will be published 
in the Federal Register and filed with the 
Court. Comments should be directed to 
Mark C. Schechter, Chief, 
Transportation, Energy and Agriculture 
Section. Antitrust Division, Room 9403, 
Judiciary Center Building, 555 4th Street, 
NW., Washington, DC 20001 (202/307- 
6349). 

Joseph H. Widmar, 

Director of Operations. 

Stipulation 

It is stipulated by and between the 
undersigned parties, by their respective 
attorneys, that: 

1. The Court has jurisdiction over the 
subject matter of this action and over 
each of the parties thereto, and venue of 
this action is proper in the District of 
Columbia: 

2. The parties consent that a Final 
Judgment in the form hereto attached 
may be filed and entered by the Court, 
upon the motion of any party or upon 
the Court’s own motion, at any time 
after compliance with the requirements 
of the Antitrust Procedures and 
Penalties Act (15 U.S.C. 16), and without 













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Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


further notice to any party or other 
proceedings, provided that Plaintiff has 
not withdrawn consent, which it may do 
at any time before the entry of the 
proposed Final Judgment by serving 
notice thereof on Defendants and by 
filing that notice with the Court; 

3. The parties shall abide by and 
comply with the provisions of the Final 
Judgment pending its entry, and shall, 
from the date of the filing of this 
Stipulation, comply with all terms and 
provisions thereof a9 though the same 
were in full force and effect as an order 
of the Court; 

4. In the event Plaintiff withdraws its 
consent or if the proposed Final 
Judgment is not entered pursuant to this 
Stipulation, this Stipulation shall be of 
no effect whatever, and the making of 
this Stipulation shall be without 
prejudice to any party in this or any 
other proceeding. 

Dated: August 17,1990. 

For Plaintiff United States of America. 
James F. Rill, 

Assistant Attorney Genera/. 

Judy Whatley, 

John W. Clark, 

Roger W. Fones, 

Attorneys. U,S. Department of Justice, 
Antitrust Division. 

Burney P. Clark, 

Anne E. Blair, 

Angela L Hughes, 

Jill Ptacek. 

Attorneys , U.S. Department of Justice, 
Antitrust Division, Judiciary Center 
Building. 555 Fourth Street, NW., 
Washington, DC 20001. [202) 307-0092. 

For Defendants—Brown and Root, Inc. and 
Halliburton Co. 

Vinson & Elkins, 1455 Pennsylvania Avenue, 
NW., Washington, DC 20004-1007. (202) 
639-6580. 

Ky P. Ewing, Jr., 

A Member of the Firm. 

For Defendant—Offshore Pipelines. Inc. 
Jones, Walker, Waechter, Poitevenl. Carrere 
& Denegre. 201 St. Charles Avenue, New 
Orleans, Louisiana 70170, (202) 504-582- 
8000. 

William B. Masters, 

A Member of the Firm. 

Stipulation Approved for Filing 
Done this 17th day of August, 199a 
Judge Jackson, 

United States District fudge. 

Final Judgment 

Whereas, plaintiff. United States of 
America, having filed ita Complaint 
herein on August 17.1990, and plaintiff 
and defendants, by their respective 
attorneys, having consented to the entry 
of this Final Judgment without trial or 
adjudication of any issue of fact or law 
herein and without this Final Judgment 


constituting any evidence against or an 
admission by any party with respect to 
any such issue; 

And whereas , defendants have agreed 
to be bound by the provisions of this 
Final Judgment pending its approval by 
the Court; 

And whereas, prompt and certain 
divestiture is the essence of this 
agreement, and defendants have 
represented to plaintiff that the 
divestiture required below can and will 
be made and that defendants will later 
raise no claims of hardship or difficulty 
as grounds for asking the Court to 
modify any of the divestiture provisions 
contained below: 

Now, therefore, before the taking of 
any testimony and without trial or 
adjudication of any issue of fact or law 
herein, and upon consent of the parties 
hereto, it is hereby 

Ordered, adjudged and decreed as 
follows: 

I. Jurisdiction 

This Court has jurisdiction over the 
subject matter of this action and over 
each of the parties hereto. The 
Complaint states a claim upon which 
relief may be granted against 
defendants under section 7 of the 
Clayton Act, as amended (15 U.S.C. 18). 

II. Definitions 

As used in this Final Judgment: 

A. BSrR means defendant Brown & 
Root, Inc.; each division, subsidiary, or 
affiliate thereof, and each officer, 
director, employee, attorney, agent or 
other person acting for or on behalf of 
any of them. 

B. Halliburton means defendant 
Halliburton Company: each division, 
subsidiary, or affiliate thereof, and each 
officer, director, employee, attorney, 
agent or other person acting for or on 
behalf of any of them. 

C. OP1 means defendant Offshore 
Pipelines, Inc.: each division, subsidiary, 
or affiliate thereof, and each officer, 
director, employee, attorney, agent, or 
other person acting for or on behalf of 
any of them. 

D. The divestiture assets means the 
marine construction vessels designated 
the BAR-278 pipelay barge and the LB- 
282 combination pipelay/pipebury 
barge. 

E. Person means any natural person, 
corporation, association, firm, 
partnership, or other business or legal 
entity. 

III. Applicability 

A. The provisions of this Final 
Judgment shall apply to the defendants, 
to their successors and assigns, to their 
subsidiaries, affiliates, directors. 


officers, managers, agents, and 
employees, and to all other persons in 
active concert or participation with any 
of them who shall have received actual 
notice of this Final Judgment by 
personal services or otherwise. 

B. Defendants shall require, as a 
condition of the sale or other disposition 
of all or substantially all of their assets 
or stock, that the acquiring party agree 
to be bound by the provisions of this 
Final Judgment. 

C. Nothing herein shall request that 
any portion of this Final Judgment is or 
has been created for the benefit of any 
third party, and nothing herein shall be 
construed to provide any rights to any 
third party. 

IV. Divestiture of Assets 

A. Defendant OPI is hereby ordered 
and directed to divest to a purchaser 
prior to March 15,1991, all of its direct 
and indirect ownership and control of 
the divestiture assets. The obligation to 
divest shall be satisfied if, by March 15, 
1991, OPI enters into a binding contract 
for sale of the divestiture assets to a 
purchaser approved by plaintiff, 
according to terms approved by plaintiff, 
that is contingent only upon compliance 
with the terms of this Final Judgment 
and that specifies a prompt and 
reasonable closing date no later than 
May 15,1991, and if sale is completed 
pursuant to the contract. 

B. If defendant OPI has not 
accomplished the required divestiture 
prior to March 15,1991, plaintiff may, in 
its sole discretion, extend this time 
period for an additional period of time 
not to exceed three months, if OPI 
requests such an extension and 
demonstrates to plaintiffs satisfaction 
that it has made bona fide efforts to sell 
the divestiture assets and that there is a 
reasonable expectation that the assets 
can be sold in the requested extended 
time period, but that the divestiture 
cannot be completed prior to March 15, 
1991. 

C. Defendant OPI agrees to take all 
reasonable steps to accomplish quickly 
said divestiture. In carrying out its 
obligations to divest the divestiture 
assets, OPI may divest these assets 
alone, or may divest along with these 
assets any other assets of OPI. 

D. In accomplishing the divestiture 
ordered by this Final Judgment, 
defendant OPI promptly shall make 
known in the United States, by usual 
and customary means, the availability of 
the divestiture assets, for sale. 

Defendant OPI shall notify any person 
making an inquiry regarding the possible 
purchase of the divestiture assets that 
the sale is being made pursuant to this 










Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 /—Notice^ 


35965 


Final Judgment and provide such person 
with a copy of the Final Judgment. The 
defendants shall also offer to furnish to 
all bona fide prospective purchasers of 
the divestiture assets, subject to 
customary confidentiality assurances, 
all pertinent information regarding the 
divestiture assets. Defendants shall 
provide such information to the plaintiff 
no later than the time they furnish such 
information to any other person. 
Defendants shall permit prospective 
purchasers of the divestiture assets to 
have access to personnel knowledgeable 
about the divestiture assets, and to 
make such inspection of physical 
facilities and any and all financial, 
operational, or other documents and 
information as may be relevant to the 
sale of the divestiture assets. 

E. Divestiture required by Section IV. 
of the Final Judgment shall be 
accomplished in such a way as to satisfy 
plaintiff, in its sole discretion, that the 
divestiture assets can and will be 
operated by the purchasers as part of a 
viable, ongoing business providing 
pipelay and pipebury barge services in 
the United States Gulf of Mexico. 
Divestiture shall be made to a purchaser 
for whom it is demonstrated to 
plaintiffs satisfaction that 11) The 
purchase is for the purpose of competing 
effectively in the provision of pipelay 
and pipebury barge services in the 
United States Gulf of Mexico, and (2) 
the purchaser has the managerial, 
operational, and financial capability to 
compete effectively in the provision of 
pipelay and pipebury barge services in 
the United States Gulf of Mexico. 

F. Divestiture required by Section IV. 
of the Final Judgment shall not be made 
to McDermott Incorporated or Pipe 
Lines Unlimited Services (PLUS) or any 
of their affiliates or subsidiaries, or to 
any company planning to move the 
assets out of the United States Gulf of 
Mexico. 

G. Except to the extent otherwise 
approved by plaintiff, any assets 
divested pursuant to this Final Judgment 
shall be divested free and clear of all 
mortgages, encumbrances and material 
liens, other than any inchoate statutory, 
admiralty, maritime, or common law 
liens for obligations not yet due and 
payable. Defendant OPI shall indemnify 
the purchaser of any assets divested 
pursuant to this Final Judgment for any 
such outstanding liens. 

V. Appointment of Trustee 

A. If defendant OPI has not 
accomplished the divestiture required 
by Section IV. of the Final Judgment by 
February 15,1991, defendants shall 
notify plaintiff of that fact. Within ten 
(10) days of that date, or twenty (20) 


days prior to the expiration of any 
extension granted pursuant to Section 
IV. B.. whichever is later, plaintiff shall 
provide defendant OPI with written 
notice of the name9 and qualifications of 
not more than two (2) nominees for the 
position of trustee for the required 
divestiture. Plaintiff will in good faith 
seek to assure that at least one of the 
nominees shall be a ship broker engaged 
primarily in the business of purchasing 
and selling vessels, including marine 
construction vessels. Defendant OPI 
shall notify plaintiff within ten (10) days 
thereafter whether either or both of such 
nominees are acceptable. If either or 
both of such nominees are acceptable to 
defendant OPI, plaintiff shall notify the 
Court of the person upon whom the 
parties have agreed and the Court shall 
appoint that person as the trustee. If 
neither of such nominees is acceptable 
to defendant OPI, it shall furnish to 
plaintiff, within ten (10) days after 
plaintiff provides the names of its 
nominees, written notice of the names 
and qualifications of not more than two 
(2) nominees for the position of trustee 
for the required divestiture. If either or 
both of such nominees are acceptable to 
plaintiff, plaintiff shall notify the Court 
of the person upon whom the parties 
have agreed and the Court shall appoint 
that person as the trustee. If neither of 
such nominees is acceptable to plaintiff, 
it shall furnish the Court the names and 
qualifications of the nominees proposed 
by plaintiff and defendant OPI. The 
Court may hear the parties as to the 
qualifications of the nominees and shall 
appoint one of the nominees as the 
trustee. 

B. If defendant OPI has not 
accomplished the divestiture required 
by Section IV. of this Final Judgment at 
the expiration of the time period 
specified in Section IV. A. or IV. B. of 
this Final Judgment, 89 applicable, the 
appointment by the Court of the trustee 
shall become effective. The trustee shall 
then take steps to effect divestiture of 
the divestiture assets; provided, 
however, that the appointment of the 
trustee shall not become effective if, 
prior to expiration of the applicable time 
period, defendant OPI has notified 
plaintiff pursuant to Section VI. of this 
Final Judgment of a proposed divestiture 
of the divestiture assets and plaintiff has 
not filed a written notice that it objects 
to said proposed divestiture. 

C. After the trustee’s appointment has 
become effective, only the trustee shall 
have the right to sell any assets as to 
which it has been designated to effect 
divestiture. The trustee shall have the 
power and authority to accomplish 
divestiture to a purchaser acceptable to 
plaintiff at such price and on such terms 


as are then obtainable upon a 
reasonable effort by the trustee, having 
due regard for the fair market value of 
the divestiture assets and the necessity 
of effectuating a prompt divestiture in 
order to preserve competition in the 
pipelay/pipebury market in the Gulf of 
Mexico, subject to the provisions of 
Section VL of this Final Judgment, and 
shall have such other powers as this 
Court shall deem appropriate. 

Defendant OPI shail not object to a sale 
of the divestiture assets by the trustee 
on any grounds other than the trustee’s 
malfeasance. Any such objection by OPI 
must be conveyed in writing to plaintiff 
and the trustee within fifteen (15) days 
after the trustee has notified defendant 
OPI of the proposed sale in accordance 
with Section VI. of this Final Judgment. 

D. The trustee shall serve at the cost 
and expense of defendant OPI, shall 
receive compensation based on a fee 
arrangement providing an incentive 
based on price and terms of the 
divestiture and the speed with which it 
is accomplished, and shall serve on such 
other terms and conditions as the Court 
may prescribe; provided, however, that 
the trustee shall receive no 
compensation, nor incur any costs or 
expenses, prior to the effective date of 
his or her appointment. The trustee shall 
account for all monies derived from a 
sale of the divestiture assets and all 
costs and expenses incurred in 
connection therewith. After approvul by 

• the Court of the trustee’s accounting, 
including fees for its services, all 
remaining monies shall be paid to 
defendant OPI and the trust shall then 
be terminated. 

E. Defendants shall take no action to 
interfere with or impede the trustee’s 
accomplishment of the divestiture and 
shall use their best efforts to assist the 
trustee in accomplishing the required 
divestiture. The trustee shall have full 
and complete access to the personnel, 
books, records, and facilities related to 
the divestiture assets, and defendants 
shall develop such financial or other 
information relevant to the divestiture 
assets as the trustee may request 

F. After its appointment becomes 
effective, the trustee shall file monthly 
reports with the parties and the Court 
setting forth the trustee’s efforts to 
accomplish divestiture as contemplated 
under this Final Judgment; provided, 
however, that to the extent such reports 
contain information that the trustee 
deems confidential, such reports shall 
not be filed in the public docket of the 
Court. Such reports shall include the 
name, address, and telephone number of 
each person who. during the preceding 
thirty (30) days, made an offer to 






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Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


acquire, expressed an interest in 
acquiring, entered into negotiations to 
acquire, or was contacted or made an 
inquiry about acquiring, any ownership 
interest in the divestiture assets, and 
shall describe in detail each contact 
with any such person during that period. 
The trustee shall maintain full records of 
all efforts made to divest these assets. 

G. Within six months after its 
appointment has become effective, if the 
trustee has not accomplished the 
divestiture required by Section V. of this 
Final Judgment, the trustee shall 
promptly file with the Court a report 
setting forth (1) The trustee’s efforts to 
accomplish the required divestiture, (2) 
the reasons, in the trustee’s judgment, 
why any required divestiture has not 
been accomplished, and (3) the trustee’s 
recommendations; provided, however, 
that to the extent such report contains 
information that the trustee deems 
confidential, such report shall not be 
filed in the public docket of the Court. 
The trustee shall at the same time 
furnish such report to the parties, who 
shall each have the right to be heard and 
to make additional recommendations 
consistent with the purpose of the trust. 
The Court shall thereafter enter such 
orders as it shall deem appropriate in 
order to carry out the purpose of the 
trust, which shall, if necessary, include 
extending the trust and the term of the 
trustee’s appointment, or ordering the 
divestiture assets to be sold to 
defendant B&R at a price the Court 
determines. 

VI. Notification 

Immediately following entry of a 
binding contract, contingent upon 
compliance with the terms of this Final 
Judgment, to effect any proposed 
divestiture pursuant to Section IV. or V. 
of this Final Judgment, defendant OPI or 
the trustee, whichever is then 
responsible for effecting the divestiture, 
shall notify plaintiff of the proposed 
divestiture, if the trustee is responsible, 
it shall similarly notify defendant OPI. 
The notice shall set forth the details of 
the proposed transaction and list the 
name, address, and telephone number of 
each person not previously identified 
who offered to acquire, or expressed an 
interest in acquiring or desire to acquire 
any ownership interest in the divestiture 
assets, together with full details of same. 
Within fifteen (15) days or receipt by 
plaintiff of such notice, plaintiff may 
request additional information 
concerning the proposed divestiture and 
the proposed purchaser. Defendant OPI 
and/or the trustee shall furnish any 
additional information requested within 
twenty (20) days of the receipt of the 
request, unless the parties shall 


otherwise agree. Within thirty (30) days 
after receipt of the notice or within 
twenty (20) days after plaintiff has been 
provided the additional information 
requested (including any additional 
information requested of persons other 
than defendants or the trustee), 
whichever is later, plaintiff shall provide 
written notice to defendant OPI and the 
trustee, if there is one, stating whether 
or not it objects to the proposed 
divestiture. If plaintiff provides written 
notice to defendant OPI and/or the 
trustee that it does not object, then the 
divestiture may be consummated, 
subject only to defendant OPI’s limited 
right to object to the sale under the 
proviso in Section V. C. Upon objection 
by plaintiff, a divestiture proposed 
under Section IV. shall not be 
consummated. Upon objection by 
plaintiff, or by defendant OPI under the 
proviso in Section V. C„ a divestiture 
proposed under Section V. shall not be 
consummated unless approved by the 
Court. 

VII. Affidavits 

Upon filing of this Final Judgment and 
every thirty (30) days thereafter until the 
divestiture has been completed or 
authority to effect divestiture passes to 
the trustee pursuant to Section V. of the 
Final Judgment, defendant OPI shall 
deliver to plaintiff an affidavit as to the 
fact and manner of compliance with 
Section IV. of the Final Judgment. Each 
such affidavit of OPI shall include the 
name, address, and telephone number of 
each person who, at any time after the 
period covered by the last such 
affidavit, made an offer to acquire, 
expressed an interest in acquiring, 
entered into negotiations to acquire, or 
was contacted or made an inquiry about 
acquiring, any ownership interest in the 
divestiture assets, and shall describe in 
detail each contact with any such 
person during that period. Defendant 
OPI shall maintain full records of all 
efforts made to divest these operations. 

VIII. Financing 

With prior consent of the plaintiff, 
defendant may finance all or any part of 
any purchase made pursuant to Sections 
IV. or V. of this Final Judgment. 

IX. Preservation of Assets 

Until the divestitute required by the 
Final Judgement has been accomplished: 

A. Defendant OPI shall take all steps 
necessary to assure that the divestiture 
assets are maintained as separate, 
distinct, and salable assets, apart from 
other assets of OPI. OPI shall use all 
reasonable efforts, including utilizing the 
divestiture assets to perform contractual 
obligations, to maintain these assets in a 


condition which makes them usable as 
part of a viable and active business of 
providing pipelay and pipebury services. 

B. Defendant OPI shall not sell, lease, 
assign, transfer, or otherwise dispose of, 
or pledge as collateral for loans (except 
such loans as are currently outstanding 
or replacement or substitutes therefore), 
the divestiture assets; provided that the 
divestiture assets may be mortgaged to 
secure financing for the acquisition of 
the divestiture assets as long as the 
mortgage is required to be released upon 
any sale made in compliance with this 
Final Judgment without regard to the 
price received therefore. 

C. Defendant OPI shall preserve the 
divestiture assets in a state of repair 
equal to their state of repair as of the 
date of this Final Judgment, ordinary 
wear and tear excepted. Defendants 
shall preserve the documents, books, 
and records relating to the divestiture 
assets until the date of divestiture. 

D. Defendants shall refrain from 
taking any action that would jeopardize 
the sale of the divestiture assets. 

X. Compliance Inspection 

For the purposes of determining or 
securing compliance with the Final 
Judgment and subject to any legally 
recognized privilege, from time to time: 

A. Duly authorized representatives of 
the Department of Justice shall, upon 
written request of the Attorney General 
or of the Assistant Attorney Ceneral in 
charge of the Antitrust Division, and on 
reasonable notice to any defendant 
made to its principle office, be 
permitted: 

1. Access during office hours of such 
defendant to inspect and copy all books, 
ledgers, accounts, correspondence, 
memoranda, and other records and 
documents in the possession or under 
the control of such defendant, who may 
have counsel present, relating to any 
matters contained in this Final 
Judgment; and 

2. Subject to the reasonable 
convenience of such defendant and 
without restraint or interference from it, 
to interview officers, employees, and 
8gents of such defendant, who may have 
counsel present, regarding any such 
matters. 

B. Upon the written request of the 
Attorney General or of the Assistant 
Attorney General in charge of the 
Antitrust Division made to any 
defendant’s principal office, such 
defendant shall submit such written 
reports, under oath if requested, with 
respect to any of the matters contained 
in this Final Judgment as may b^ 
requested. 











Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35967 


C. No information or documents 
obtained by the means provided in this 
Section X. shall be divulged by a 
representative of the Department of 
Justice to any person other than a duly 
authorized representative of the 
Executive Branch of the United States, 
except in the course of legal proceedings 
to which the United States is a party 
(including grand jury proceedings), or 
for the purpose of securing compliance 
with this Final Judgment, or as 
otherwise required by taw. 

D. If at the time information or 
documents are furnished by any 
defendant to plaintiff, such defendant 
represents and identifies in writing the 
material in any such information or 
documents to which a claim of 
protection may be asserted under rule 
26(c)(7) of the Federal Rules of Civil 
Procedure, and such defendant marks 
each pertinent page of such material. 
“Subject to claim of protection under 
rule 26(c)(7) of the Federal Rules of Civil 
Procedure." then ten (10) days notice 
shall be given by plaintiff to defendants 
prior to divulging such material in any 
legal proceeding (other than a grand jury 
proceeding). 

XI. Retention of Jurisdiction 

Jurisdiction is retained by this Court 
for the purpose of enabling any of the 
parties to this Final Judgment to apply to 
this Court at any time for such further 
orders and directions as may be 
necessary or appropritc for the 
construction or carrying out of this Final 
Judgment, for the modification of any of 
the provisions hereof, for the 
enforcement of compliance herewith, 
and for the punishment of any violations 
hereof. 

XII. Termination 

This Final Judgment will expire on the 
fifth anniversary of the date of its entry. 

XIII. Public Interest 

Entry of this Final Judgement is in the 
public interest. 

Dated: 

United Slates District Judge 

Competitive Impact Statement 

Pursuant to section 2(b) of the 
Antitrust Procedures and Penalties Act 
(“APPA"), 15 U.S.C. 16(bHh). the United 
States of America files this Competitive 
Impact Statement relating to the 
proposed Final Judgment submitted for 
entry with the consent of Brown & Root. 
Inc., Halliburton Company, and Offshore 
Pipelines. Inc. in this civil antitrust 
proceeding. 


I. Nature and Purpose of the Proceeding 

On August 17.1990, the United States 
filed a Complaint alleging that the 
proposed acquisition from Brown A 
Root, Inc. (hereafter (“BAR") by 
Offshore Pipelines. Inc. (hereafter 
"OPI") would violate section 7 of the 
Clayton Act (15 U.S.C. 18). The 
Complaint alleges that the effect of the 
merger may be substantially to lessen 
competition in the provision of pipelay- 
pipebury barge services in water depths 
of approximately 200 to 400 feet, or with 
pipe of diameters greater than 12 inches 
in the United States Gulf of Mexico 
(“intermediate pipelay-pipebury 
market"). Both BAR and OPI provide 
such services. Pipelay and pipebury 
barge services are contracted for by oil 
companies to install and bury pipeline in 
connection with the offshore 
development and production of crude oil 
and natural gas in the U.S. Gulf. The 
Complaint seeks, among other relief, a 
permanent injunction preventing 
defendants from, in any manner, 
combining their marine construction 
businesses. 

On August 16,1990. the United States 
and defendants filed a Stipulation by 
which they consented to the entry of a 
proposed Final Judgment designed to 
eliminate the anticompetitive effects of 
the acquisition. Under the proposed 
Final Judgment as explained more fully 
below, OPI would be required to sell, by 
March 15,1991. certain pipelay and 
pipebury vessels. If it should fail to do 
so. a trustee appointed by the Court 
would be empowered to sell these 
vessels. 

The United States, BAR and OPI have 
agreed that the proposed Final Judgment 
may be entered after compliance with 
the APPA. Entry of the proposed Final 
Judgment will terminate the action, 
except that the Court will retain 
jurisdiction to construe, modify, and 
enforce the Final Judgment, and to 
punish violations of the Final Judgment. 

II. Events Giving Rise to the Alleged 
Violation 

On May 4.1990. BAR and OPI entered 
into a purchase agreement under which 
OPI would purchase from BAR 23 marine 
construction vessels, including seven 
vessels located in the U.S. Gulf, and 
associated assets. This acquisition 
would, if unchallenged, effectively 
merge all of BAR’S and OPI’s marine 
construction business. The purchase 
price to be paid by OPI to BAR for the 
marine construction business of BAR is 
approximately $80 million. 

Brown & Root Inc. is an engineering 
and construction services company, 
headquartered in Houston. Texas. Along 


with its other construction businesses. 
BAR'S marine unit has owned a marine 
construction fleet of 23 major vessels 
and has provided marine construction 
services in the U.S. Gulf and other 
international offshore regions. BAR is a 
wholly-owned subsidiary of Halliburton 
Company, an oil field services firm, 
located in Dallas. Texas. In 1989. 
Halliburton had total assets of $853 
million and revenues of $2.9 billion. OPI 
is headquartered in Houston. Texas. By 
January 1990, OPI had assets of $70 
million and earned revenues of $104 
million in 1989. OPI has provided marine 
construction services with its ten-vessel 
fleet in the U.S. Gulf. 

The Complaint alleges that the 
intermediate pipeiay/pipebury market is 
a relevant product market for antitrust 
purposes. As alleged in the Complaint, 
the United States Gulf of Mexico is a 
relevant geographic market, within the 
meaning of section 7 of the Clayton Act. 
Pipelay barges, pipebury barges, and 
combination pipeiay/pipebury barges 
are specially designed, built or modified, 
and equipped to be capable of laying 
and/or burying pipeline on the sea 
bottom. Vessels vary in their 
capabilities to lay or bury certain 
diameters of pipe and to do so in certain 
water depths depending predominantly 
on the size of the vessel. The ability to 
lay or bury larger diameter pipe in 
deeper water requires a larger vessel, 
with greater anchoring capability, and 
the capacity to control heavier or longer 
pipe. There is no competitive substitute 
for pipeiay/pipebury barge services to 
which a significant number of customers 
would turn in the event of a small 
nontransitory price increase. Firms that 
provide pipeiay/pipebury barge services 
in the U.S. Gulf compete with each other 
for bids. Customers generally solicit bids 
from the companies they believe are 
capable of working at the water depths 
and with the pipe diameters required for 
the particular project. For almost all 
projects at water depths of 
approximately 200-400 feet, or w ith pipe 
of diameters greater than 12 inches, 
currently only four firms compete in the 
U.S. Gulf. Two of those four firms are 
BAR and OPI 

The Complaint alleges that the 
intermediate pipeiay/pipebury market is 
highly concentrated and would become 
substantially more concentrated as a 
result of the violation alleged herein. 
Based on 1989 sales data, BAR and OPI 
have, respectively, about 31 and 27 
percent, respectively, of the 
intermediate pipeiay/pipebury market in 
which onty four firms now compete. The 
merger of BAR and OPI would result in 
Hn increase in the Herfindahl- 






33968 


Fcdeial Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


I lirschman Index by about 1669 to 4764. 
A market with a post-acquisition I fill of 
1900 is moderately concentrated, and a 
market with a post-acquisition IIIII of 
1HOO is highly concentrated. 

Entry into the intermediate pipelay/ 
pipebury market is time-consuming and 
costly, and is unlikely to occur in 
response to a small but significant 
nontransitory price increase. To enter 
the market, a firm must obtain a barge of 
sufficient size to hold the necessary 
equipment and to operate in deeper 
waters. Such barges are not currently 
evnilable in the U S. Gulf. If the only 
available barges are located somewhere 
other than the U.S. Gulf, the entrant 
must bear the significant cost of 
transporting the vessel to the Gulf. 
Further, after a barge is obtained, the 
entrant will likely have to refurbish the 
barge and install the necessary 
equipment to lay and bury pipe. Finally, 
entrants must find capable personnel to 
work on the barges to provide the 
services. All of these steps are time- 
consuming and costly. 

III. Explanation of the Proposed Final 
Judgment 

The United States brough this action 
because the effect of the proposed 
acquisition from B&R by OPI may be 
substantially to lessen competiton, in 
violation of section 7 of the Clayton Act. 
in the intermediate pipelay/pipebury 
market. The risk to competiton posed by 
this transaction, however, substantially 
would be eliminated were sufficient 
pipelay/pipebury vessels to be sold to a 
purchaser that would operate them as 
an active, independent and financially 
viable competitor in the intermediate 
pipelay/pipebury market. To this end, 
the provision of the proposed Final 
judgment are designed to accomplish 
the sale of certain vessels capable of 
performing services in the Intermediate 
pipelay/pipebury market to such a 
purchaser or purchasers and prevent the 
anticompetitive effects of the proposed 
acquisition. 

Section IV. of the proposed Final 
Judgmen 4 requires defendant OPI. by 
March 15.1991, to divest the BAR-276 
combination pipelay/pipebury barge 
and the LB-262 combination pipelay/ 
pipebury barge to a purchaser or 
purchasers that has the intent and 
capability to compete promptly and 
effectively in the provision of pipelay/ 
pipebury barge services in the U.S. Gulf. 

Under the proposed Final Judgment, 
defendants must take all reasonable 
steps necessary to accomplish quickly 
the divestiture of the specified assets, 
and shall cooperate with bona fide 
prospective purchasers by supplying all 
information relevant to the proposed 


sale. Should OPI fail to complete its 
divestiture by March 15,1991, the Court 
will appoint, pursuant to Section V., a 
trustee to accomplish the divestiture. 

The United States will have the 
discretion to delay the appointment of 
the trustee for up to an additional three 
months should it appear that the assets 
can be sold in the extended time period. 

Following the trustee’s appointment, 
only the trustee will have the right to 
sell the divestiture assets, and 
defendant OPI will be required to pay 
for all of the trustee’s sale-related 
expenses. 

Section VI. of the proposed Final 
Judgment would assure the United 
States an opportunity to review any 
proposed sale, whether by OPI or by the 
trustee, before it occurs. Under this 
provision, the United States is entitled 
to receive complete information 
regarding any proposed sale or any 
prospective purchasers prior to 
consummation. Upon objection by the 
United States to a sale of the divestiture 
assets by the defendant OPI, a proposed 
divestiture may not be completed. 

Should the United States object to a sale 
of the divested assets by the trustee, 
such sale shall not be consummated 
unless approved by the Court. 

Under Section IX. of the proposed 
Final Judgment, defendant OPI must 
take certain steps to ensure that, until 
the required divestiture has been 
completed, both the BAR-278 and the 
IJB-282 will be maintained as distinct 
saleable assets. Until such divestiture, 
defendant OPI must also preserve and 
maintain the divestiture assets as 
salable assets, making all reasonable 
efforts to maintain the assets in a 
rendition which makes them usable as 
part of a viable and active business of 
providing pipelay/pipebury barge 
services. 

Pursuant to Section V.. should the 
trustee not accomplish the divestiture 
within six months of appointment, the 
trustee and the parties will make 
recommendations to the Court, which 
shall enter such orders as it deems 
appropriate to carry out the purpose of 
the trust, which may include extending 
the trust or the term of the trustee’s 
appointment or ordering that the 
divestiture assets be sold to BftR at a 
Court-determined price. Section XII. 
provides that the proposed Final 
judgment will expire on the fifth 
anniversary of its entry by the Court. 

IV. Remedies Available to Potential 
Private Litigants 

Section 4 of the Clayton Act (15 U.S C. 
15) provides that any person who has 
been injured as a result of conduct 
prohibited by the antitrust law's may 


bring suit in federal court to recover 
three times the damages the person has 
suffered, as well as costs and 
reasonable attorneys’ fees. Entry of the 
proposed Final Judgment will neither 
impair nor assist the bringing of any 
private antitrust damage action. Under 
the provisions of section 5(a) of the 
Clayton Act (15 U.S.C. 16(a)), the 
proposed Final Judgment has no prinia 
facie effect in any subsequent private 
lawsuit that may be brought against 
defendants. 

V. Procedure Available for Modification 
of the Proposed Final Judgment 

The United Slates and defendants 
have stipulated that the proposed Final 
Judgment may be entered by the Court 
after compliance with the provisions of 
the APPA, provided that the United 
States has not withdrawn its consent. 
The APPA conditions entry upon the 
Court’s determination that the proposed 
Final Judgment is in the public interest. 

The APPA provides a period of at 
least 60 days preceding the effective 
date of the proposed Final Judgment 
within which any person may submit to 
the United States written comments 
regarding the proposed Final Judgment. 
Any person who wishes to comment 
should do so within 60 days of the date 
of publication of this Competitive 
Impact Statement in the Federal 
Register. The United States will 
evaluate the comments, determine 
whether it should withdraw its consent, 
and respond to comments. The 
comments and the response of the 
United States will be filed with the 
Court and published in the Federal 
Register. 

Written comments should be 
submitted to: Mark C. Schechter, Chief 
Transportation. Energy 8 Agriculture 
Section, Antitrust Division, Judiciary 
Center Building, 555 4th Street. NW., 
Room 9403. Washington, DC 20C01. 

VI. Alternatives to the Proposed Final 
Judgment 

The proposed Final Judgment requires 
that the divestiture assets be sold to a 
purchaser or purchasers that would use 
them promptly to provide viable 
competition in the provision of pipelay/ 
pipebury barge services in the U.S. Gulf. 
Thus, compliance with the proposed 
Final Judgment and the completion of 
the sale required by the Judgment would 
resolve the competitive concerns raised 
by the proposed transaction, and assure 
that the divestiture assets would be 
used as part of a viable and active 
competitor to OPI’s provision of 
pipelay/pipebury r barge services 









Federal Register / Vol. 53, No. 171 / Tuesday. September 4, 1990 / Notices 


35969 


Litigation is, of course, always an 
alternative to a consent decree in a 
section 7 case. The United States 
rejected this alternative because the 
sale required under the proposed Final 
Judgment should prevent the acquisition 
from B&R by OPI from having a 
significant anticompetitive effect in the 
relevant market alleged, the 
intermediate pipelay/pipebury market. 

Of the seven B&R barges currently 
operating in the United States Gulf of 
Mexico, three compete with OPI 
primarily in the intermediate pipelay/ * 
pipebury market: the BAR-278 
combination pipelay/pipebury barge, 
the BAR-289 pipelay barge and the 
BAR-356 pipebury barge. The proposed 
Final Judgment provides that OPI will 
divest the BAR-278, and. instead of the 
BAR-289 and BAR-356. OPfs LB-282 
combination pipelay/pipebury barge. 
The LB-282 competes directly with the 
BAR-289 and BAR-356 in the relevant 
market. Thus, in the hands of an 
appropriate purchaser or purchasers the 
divestiture assets will effectively 
replace B&R as a competitor in the 
intermediate pipelay/pipebury market. 

The United States is satisfied that the 
proposed Final Judgment fully resolves 
the anticompetitive effects of the 
proposed merger alleged in the 
Complaint. Although the proposed Final 
Judgment may not be entered until the 
criteria established by the APPA (15 
U.S.C. 16(bHh)) have been satisfied, the 
public will benefit immediately from the 
safeguards in the proposed Final 
Judgment because the defendants have 
stipulated to comply with the terms of 
the Judgment pending its entry by the 
Court. 

VII. Determinative Materials and 
Documents 

There are no materials or documents 
that the United States considered to be 
determinative in formulating this 
proposed Final Judgment. Accordingly, 
none are being filed with this 
Competitive Impact Statement. 

Dated: August 17.1990. 

Respectfully submitted. 

Burney P. Clark. 

Anne E. Blair. 

Angela L. Hughes. 

Jill Ptacek, 

Attorneys, US. Department of Justice, 
Antitrust Division, Judiciary Center Building. 
555 Fourth Street, NW.. Washington. DC 
20001. (202) 307-0892. 

[FR Doc. 90-20299 Filed 8-31-90: 8:45 am| 

BILLING CODE 4410-01-11 


NATIONAL ARCHIVES AND RECORDS 
ADMINISTRATION 

Records Schedules; Availability and 
Request for Comments 

agency: National Archives and Records 
Administration, Office of Records 
Administration. 

action: Notice of availability of 
proposed records schedules: request for 
comments. 

summary: The National Archives and 
Records Administration (NARA) 
publishes notice at least once monthly 
of certain Federal agency requests for 
records disposition authority (records 
schedules). Records schedules identify 
records of sufficient value to warrant 
preservation in the National Archives of 
the United States. Schedules also 
authorize agencies after a specified 
period to dispose of records lacking 
administrative, legal, research, or other 
value. Notice is published for records 
schedules that (1) propose the 
destruction of records not previously 
authorized for disposal, or (2) reduce the 
retention period for records already 
authorized for disposal. NARA invites 
public comments on such schedules, as 
required by 44 USC 3303a(a). 

DATES: Requests for copies must be 
received in writing on or before October 
19,1990. Once the appraisal of the 
records is completed. NARA will send a 
copy of the schedule. The requester will 
be given 30 day3 to submit comments. 
addresses: Address requests for single 
copies of schedules identified in this 
notice to the Records Appraisal and 
Disposition Division (NIR). National 
Archives and Records Administration, 
Washington, DC 20408. Requesters must 
cite the control number assigned to each 
schedule when requesting a copy. The 
control number appears in parentheses 
immediately after the name of the 
requesting agency. 

SUPPLEMENTARY INFORMATION: Each 
year U.S. Government agencies create 
billions of records on paper, film, 
magnetic tape, and other media. In order 
to control this accumulation, agency 
records managers prepare records 
schedules specifying when the agency 
no longer needs the records and what 
happens to the records after this period. 
Some schedules are comprehensive and 
cover all the records of an agency or one 
of its major subdivisions. These 
comprehensive schedules provide for 
the eventual transfer to the National 
Archives of historically valuable records 
and authorize the disposal of all other 
records. Most schedules, however, cover 
records of only one office or program or 


a few series of records, and many are 
updates of previously approved 
schedules. Such schedules also may 
include records that are designed for 
permanent retention. 

Destruction of records requires the 
approval of the Archivist of the United 
States. This approval is granted after a 
thorough study of the records that takes 
into account their administrative use by 
the agency or origin, the rights and 
interests of the Government and of 
private persons directly affected by the 
Government’s activities, and historical 
or other value. 

This public notice identifies the 
Federal agencies and their subdivisions 
requesting disposition authority, 
includes the control number assigned to 
each schedule, and briefly describes the 
records proposed for disposal. The 
records schedule contains additional 
information about the records and their 
disposition. Further information about 
the disposition process will be furnished 
to each requester. 

Schedules Pending 

1. Department of Agriculture, Foreign 
Agricultural Service (Nl-166-90-1). 
Electronic data on U.S. imports and 
exports of agricultural commodities, 
extracted from Bureau of Census data. 

2. Department of Commerce, Bureau of 
Export Administration, Office of Export 
Enforcement (Nl-476-90-3). 
Chronological files. 

3. Department of Commerce, Bureau of 
Export Administration, Office of Foreign 
Availability (Nl-470-90-4). 
Comprehensive records schedule. 

4. Department of Commerce, Bureau of 
Export Administration. Under Secretary 
for Export Administration (Nl-476-90- 
8). Comprehensive records schedule. 

5. Department of Commerce, Bureau of 
Export Administration, Director of 
Administration (Nl-476-90-10). 
Comprehensive records schedule. 

6. Department of Education, Office of 
Education, Civil Defense Education 
Branch (N1-12-9CM). State financial 
reports and housekeeping records, 1959- 
71. 

7. Department of Education. Office of 
Education (Nl-12-90-5). Records 
relating to the administration of grants, 
1959-79. 

8. Federal Labor Relations Authority 
(Nl-480-90-1). Regional copies of 
certification records. 

9. General Services Administration, 
Office of Administration (Nl-269-90-3). 
Program training records, directives, 
case files, and contracting records. 

10. Department of Health and Human 
Services, Public Health Service, Health 
Resources and Services Administration 










35970 


Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Notices 


(N1-90-90-11). Reduction in retention 
period for records relating to the 
administration of grant support for 
health care, health professions 
education and nurse training facilities. 

11. Department of Health and Human 
Services. Centers for Disease Control. 
National Center for Health Statistics 
(N1-442-90-2). International Statistics 
Staff Working Papers. 

12. United States Information Agency 
(Nl-59-90-14). Records of the 
Department of State. Bureau of 
Educational and Cultural Affairs 
transferred to the USICA in 1978. 
Routine and faciliative records relating 
to the International Book Year. 

13. Department of the Interior. U.S. 
Geological Survey (Nl-57-89-5). Analog 
data from the Exclusive Economic Zone 
Mapping Project in paper, film, and 
magnetic tape media. 

14. Department of justice. Federal 
Bureau of Investigation {Nl-65-90-1). 
Fingerprint cards and related textual 
material generated in connection with 
background investigations, arrests, or 
incarcerations. 

15. Department of justice, Federal 
Bureau of investigation (Nl-65-90-3). 
Sound recordings made in surveillance 
of suspected foreign intelligence agents. 

16. Department of Justice, Federal 
Bureau of Investigation (Nl-65-90-4). 
Office of Planning. Evaluation and 
Audits work papers. 

17. Panama Canal Commission (Nl- 
185-90-11). Personnel and medical 
records for Panama Canal cargo and 
passenger vessel crew members. 

18. Department of State. U.S. Embassy 
Bangkok, Refugee Office (Nl-64-90-4). 
Affidavits of relationship. 

Dated: August 24,1990- 
Don W. Wilson. 

Archivist of the United Stales. 

|FR Doc.90-20694 Filed 8-31-90; 8:45 am] 
BILLING CODE 751S-01-4I 


NATIONAL SCIENCE FOUNDATION 

Permit Applications Received Under 
the Antarctic Conservation Act of 1978 

agency: National Science Foundation. 
action: Notice of permit applications 
received under the Antarctic 
Conservation Act of 1978, Public Law 
95-541. 

summary: The National Science 
Foundation (NSF) is required to publish 
notice of applications received to 
conduct activities regulated under the 
Antarctic Conservaton Act of 197a NSF 
has published regulations under the 


Antarctic Conservation Act of 1978 at 
title 45 part 670 of the Code of Federal 
Regulations. This is the required notice 
of permit applications received. 

DATES: Interested parties are invited to 
submit written data, comments, or views 
with respect to these permit applications 
by October 5,1990. Permit applications 
may be inspected by interested parties 
at the Permit Office, address below. 

addresses: Comments should be 
addressed to Permit Office, Room 627, 
Division of Polar Programs, National 
Science Foundation, Washington, DC 
20550. 

FOR FURTHER INFORMATION CONTACT: 

Charles £. Myers at the above address 
or(202) 357-7934. 

SUPPLEMENTARY INFORMATION: The 

National Science Foundation, as 
directed by the Antarctic Conservation 
Act of 1978 (Pub. L. 95-541). has 
developed regulations that implement 
the “Agreed Measures for the 
Conservation of Antarctic Fauna and 
Flora” for all United States citizens. The 
Agreed Measures, developed by the 
Antarctic Treaty Consultative Parties, 
recommended establishment of a permit 
system for various activities in 
Antarctica and designation of certain 
animals and certain geographic areas as 
requiring special protection. The 
regulations establish such a permit 
system to designate Specially Protected 
Areas and Sites of Special Scientific 
Interest. 

The applications received are as 
follows: 

1.90-18 Applicant 

Mahlon C. Kennicutt, Texas A&M 
University, College Station, Texas 
77845. 

Activity for Which Permit Requested 

Taking. Import into USA. The 
applicant is conducting research on the 
effects on birds of the fuel spill resulting 
from the grounding of the Argentine 
vessel Bahia Para iso. He proposes to 
salvage dead bird specimens and import 
them to the U.S. for hydrocarbon 
analysis. 

The applicant proposes to enter site of 
special scientific interest, Litchfield 
Island, to salvage bird specimens. 

Location 

Antarctic Peninsula in vicinity of 
Palmer Station. 

Dates 

March-April 1991. 


2. 90-22 Applicant 

john L. Bcngtsen, National Marine 
Mammal Laboratory. 7600 Sand Point 
Way. NE.. Seattle. WA 98115. 

Activity for Which Permit Requested 

Taking. Import into USA. Export from 
USA. Enter Site of Special Scientific 
Interest. The applicant is conducting 
research on the feeding ecology, 
reproduction, and population dynamics 
of Antarctic seals. He requests 
permission to deploy time-depth 
recorders, radio transmitters, and 
satellite-linked electronics of seals of 
various species to monitor their 
behavior. Permission is requested to 
enter Cape Shirreff and Byers Peninsula 
on Livingston Island Sites fo Special 
Scientific Interest to study seals and 
birds. 

Permission is also requested to import 
specimen material into the U.S. and 
export specimens to allow exchange of 
material among researchers of various 
nations. Specimens to be taken 
(capture/release] are as follows: 

Crabeater Seal- 100 

Leopard Seal- 100 

Weddell Seal_U)0 

Ross Seal.50 

Antarctic Fur Sea!.1000 

Southern Elephant Seal-100 

Location 

Antarctica Peninsula area. 

Dotes 

November 1990—October 1992. 

3.90-23 Applicant 

John L. Bengtson, National Marine 
Mammal Laboratory, 7600 Sand Point 
Way. NE., Seattle, WA 98115 

Activity for Which Permit Requested 

Taking. Import into USA. The 
applicant is conducting studies of food 
web dynamics of krill-consuming 
species of seabirds, and proposes to use 
doubly-labeled water techniques (using 
the stable, non-radioactive isotopes of 
oxygen-18 and deuterium) to measure 
energy requirements of penguins and 
other sea birds. Blood samples will be 
taken from birds and samples will be 
returned to the U.S. for analysis. 
Seabirds will be taken by capture end 
release for (numbers refer to table 
below): (1) banding and/or making. (2) 
measuring, weighing, and/or examining. 
(3) stomach pumping, (4) attaching/ 
removing instruments, and (5) injecting 
isotopes and/or drawing biood samples. 
An unspecified number of seabirds and 
seals mey be incidentally disturbed 
during research; efforts will be made to 
avoid or minimize such disturbance. 


















Federal Register / Vol. 55. No. 171 / Tuesday, September 4. 1990 / Notices 


*5971 


Species 

Annual 

num¬ 

ber 

taKen 

Take by 

Import 
to use 

Chinstrap penguin. . 

2,500 

1,000 

Capt/release M l.. 1T - r . T ~. 

No. 

Chmstrao penguin. . 

Capt/release M2 ......... 

No. 

Chinstrap penguin. . 

100 

Capt/release M3 ......... 

No- 

Chinstrap penguin ........... 

150 

Capt/release #4........ 

No. 

Chinstrap penguin. 

21 

Capt/release M 5 ....... 

Yes 

Macaroni penguin. . ......... 

500 

Capt/release M 1_—....... 

(blood 

sam¬ 

ples). 

No. 

Macaroni penguin. . 

200 

Capt/release M2 ..... . . 

No. 

Macaroni penguin... 

50 

Capt/release #3... . ... ...... 

No. 

Maca r oni penguin........................... 

50 

Capt/release M 4... ...-... 

No. 

Macaroni penguin. 

7 

Capt/release M 5........... 

Yes 

Cape petrel. 

200 

Capt/release M 1....... ...i... 

(blood 

sam¬ 

ples). 

No. 

Cape petrel.......... 

100 

Capt/release M2 . 

No 

American Sheathbill.„..... 

200 

Capt/release M 1............... 

No 




Location 

Antarctica Peninsula area. 

Dates 

November 1990—October 1992. 
Charles E. Myers, 

Permit Office. 

[FR Doc. 90-20653 Filed 0-31-90; 8:45 ami 
BILLING COOE 7555-01-* 


Permits Issued Under the Antarctic 
Conservation Act of 1978 

agency: National Science Foundation. 

action: Notice of permits issued under 
the Antarctic Conservation Act of 1978, 
Public Law 95-541. 


summary: The National Science 
Foundation (NSF) is required to publish 
notice of permits issued under the 
Antarctic Conservation Act of 1978. This 
is the required notice of permits issued. 

FOR FURTHER INFORMATION CONTACT: 

Charles E. Myers, Permit Office, 

Division of Polar Programs. National 
Science Foundation, Washington, DC 
20550. 

SUPPLEMENTARY INFORMATION: On July 
23,1990, the National Science 
Foundation published a notice in the 
Federal Register of permit applications 
received. Permits were issued to the 
following individuals on August 27,1990: 

Gary D. Miller, and Diana Freckman. 

The permit application from Gary 
Miller proposed work with Adelie 
penguins, but this work is not part of an 
approved research project. For this 
reason, that part of his permit 
application request which relates to 
delie penguins was not approved. 


Permission was granted only for work 
with South Polar skuas. 

Charles E. Myers, 

Permit Office. Division of Polar Programs. 
[FR Doc. 90-20636 Filed 8-31-90; 8:45 am] 
BILLING COOE 755S-01-M 


NUCLEAR REGULATORY 
COMMISSION 

[Docket Nos. 50-325 and 50-3241 

Carolina Power & Light Co.; 
Consideration of Issuance of 
Amendment to Facility Operating 
License and Proposed No Significant 
Hazards Consideration Determination 
and Opportunity for Hearing 

The U.S. Nuclear Regulatory 
Commission (the Commission) is 
considering issuance of an amendment 
to Facility Operating License Nos. DPR- 
71 and DPR-62 issued to Carolina Power 
& Light Company (CP&L or the licensee) 
for operation of Brunswick Steam 
Electric Plant. Units 1 and 2, located in 
Brunswick County, North Carolina. 

The proposed change adds a footnote 
to Action Requirement 3.8.1.1.a that 
allows the flexibility required to perform 
extended maintenance on an offsite 
circuit. Additional changes to Technical 
Specifications (TS) 3.8.1.1 and 3.8.1.2 are 
also being made to clarify the existing 
AC source operability requirements. 
Currently. Technical Specification 3/ 
4.8.1 implies that two offsite power 
sources are required for a unit in 
Operational Condition 4 or 5 if the other 
unit is in Operational Condition 1, 2, or 3 
and provides an allowable out of service 
time of 72 hours if one of the sources is 
inoperable. In the past, Carolina Power 
& Light Company (CP&L) interpreted the 
two offsite power sources to be the 


transmission lines coming into the 
switchyard and. as such, experienced no 
problems in meeting the requirements of 
the TS. During their recent inspection, 
the Diagnostic Evaluation Team took the 
position that CP&L’s understanding was 
incomplete and that the offsite power 
sources include the unit auxiliary 
transformer (UAT) and the startup 
auxiliary transformer (SAT). This 
interpretation would result in the need 
for a dual unit outage to perform 
maintenance on either the UAT or the 
SAT if that maintenance will require 
more than 72 hours to complete. 
Therefore, the proposed amendment 
adds a footnote to the Action 
Requirements of Technical Specification 
3.8.1.1.a to require shutdown of an 
operating unit should the outage time for 
one offsite circuit for a shutdown unit 
exceed 45 days. In addition, changes are 
proposed to TS 3.8.I.I. and 3.8.1.2 to 
clarify existing AC power source 
operability requirements. 

Before issuance of the proposed 
license amendment, the Commission 
will have made findings required by the 
Atomic Energy Act of 1954, as amended 
(the Act) and the Commission's 
regulations. 

The Commission has made a proposed 
determination that the request for 
amendment involves no significant 
hazards consideration. Under the 
Commission s regulations in 10 CFR 
50.92, this means that operation of the 
facility in accordance with the proposed 
amendment would not (1) Involve a 
significant increase in the probability or 
consequences of an accident previously 
evaluated; or (2) create the possibility of 
a new or different kind of accident from 
any accident previously evaluated; or (3) 
involve a significant reduction in a 
margin of safety. 


















































35972 


Federal Register / Vol. 55. No. 171 / Tuesday, September 4, 1990 / Notices 


The licensee has provided the following 
analysis: 

1. The proposed amendment does not 
involve a significant increase in the 
probability or consequences of an accident 
previously evaluated. There is no physical 
modification to the plant or change to the 
method in which any safety related 
equipment performs its intended function as 
a result of the proposed amendment. The 
proposed change adds a footnote to action 
requirements of Technical Specification 
3.8.1.1.a which allows one offsite power 
source, on the other unit* to be removed from 
service for up to 45 days provided that unit is 
in Operational Conditions 4 or 5. For 
example, during the upcoming Brunswick ! 
refueling outage, the Bruns wick-1 SAT and 
UAT can individually be removed from 
service for up to 45 days without requiring 
Brunswick-2 to shutdown (SIC). The 
Company expects to need this flexibility in 
order to perform transformer maintenance, 
inspections, and bus duct inspections. The 
operability of the two offsite circuits on the 
operating unit is not affected by these 
activities. The work planned for the 
upcoming Brunswick-1 outage is expected to 
take approximately 45 days for the UAT and 
33 days for the SAT to complete. Therefore. 
CP&L requests that the Action Requirements 
of Technical Specification 3.8.1 .a be extended 
to 45 days from the date the transformer is 
removed from service. In addition, the 
footnote states that during this 45 day period, 
action Requirements 3.&.1.1.&.1, 3.8.1.l.a.2. 
and 3.8.1.1.a.3 are not applicable. If the offsite 
circuit of the shutdown unit is not operable at 
the end of the 45 day period the Action 
Requirements of Technical Specification 
3.8.1.1.1 .a will be initiated and the operating 
unit will be placed in Hot Shutdown within 
12 hours and in Cold Shutdown within the 
following 24 hours. 

For operation to continue on the operating 
unit while one of the shutdown unit’s offsite 
power sources is out of service, the existing 
Technical Specifications require all four 
diesel generators and the remaining offsite 
power sources to be operable. Action 
Requirement 3.8.1.1.C or 3.8.1.1.d wilt be 
applicable to the operating unit upon loss of a 
diesel generator or loss of an additional 
offsite circuit The existing Technical 
Specifications provide adequate assurance of 
the availability of AC power to the Operating 
unit. 

As stated above, part of the offsite power 
source maintenance planned for the 
upcoming Brunswick-l Reload 7 outage is not 
routine. The scope of future maintenance and 
inspection activities will be based, in part, on 
the results of the upcoming Brunswick-1 
activities. Currently, the Unit Auxiliary 
Transformer (UAT) and Startup Auxiliary 
Transformer (SAT) are scheduled to be 
removed from service for approximately 45 
days and 33 days, respectively. The 
likelihood of losing an additional AC power 
source during this time is low. Should such a 
loss occur, each of the Brunswick Units is 
designed to withstand a loss of offsite power 
as described in Section 15.2.5. of the 
Brunswick Updated FSAR. Also, Action 
Requirements 3.8.I.I.C. and 3.8.1.1.d. assure 
that the operating unR will be placed in a 
safe condition. 


The proposed amendment also clarifies 
Technical Specifications 3.8.1.1 and 3.01.2 
with respect the AC power source operability 
requirements. Currently* the heading for 
Technical Specification 3.8.1.1 states: 
"Operation of one or both Unii9." As 
interpreted, Technical Specification 3.8.t.l 
requires all four diesels and two offsite 
circuits per unit to be operable if either unit is 
in Operational Conditions (S/C) 1. 2, or 3. 

The proposed amendment revises the 
heading to state: "OPERATING” and inserts 
the words "per unit" into Technical 
Specification 3.8.1.1.a, which will now state 
'Two physically independent circuits, per 
unit, between the offsite transmission 
network and the onsite Class IE distribution 
system" The required number of AC power 
sources is not affected, this change revises 
the Technical Specification to explicitly state 
the existing requirements as interpreted. 

Similarly, the heading for Technical 
Specification 3.8.1.2 currently states: 
"Shutdown of Both Units." The proposed 
amendment revises the heading to read: 
"Shutdown" and clarifies Technical 
Specification 3.8.1.2.b to assure that there 
shall be at least one operable diesel 
generator assigned to the shutdown unit 
(diesel generator 1 or 2 for Unit 1 and diesel 
generator 3 or 4 for Unit 2). As with Technical 
Specification 3.8.1.1, the proposed change to 
the heading does not affect the number of AC 
sources required to be operable, they merely 
state these requirements more expfiritly. 

The above changes also ensure that 
appropriate actions are taken for a shutdown 
unit. While Technical Specification 3.8.1.1 is 
currently interpreted to be applicable when 
one unit is operating and the other unit Is 
shutdown, the specified actions are not 
meaningful to a shutdown unit because they 
provide no compensatory measures. The 
actions specified in Technical Specification 
3.8.1.2 are appropriate compensatory 
measures for a unit in Operational Conditions 
|SIC] 4 or 5; however, that technical 
specification iB currently applicable only 
when both units are shutdown. This change 
ensures the appropriate compensatory 
measures are taken for a unit in Operational 
Conditions (S/C) 4 or 5 regardless of the 
status of the other unit. 

The final change made in the proposed 
amendment adds the word “Operational" in 
the Applicability of Technical Specification 
3 8.1.2 and is purely administrative in nature. 
The change enhances consistency with the 
Technical Specifications. 

Carolina Power A Light Company is aware 
of the recent loss of offsite power event at 
Georgia Power Company’s Vogtlc Plant and 
has established a procedure for control of 
switchyard activity. The Company believes 
that the existing Technical Specifications and 
the additional actions provide adequate 
assurance of the availability of AC power 
and, as such, the proposed amendment does 
not involve a significant increase in the 
probability or consequences of an accident 
previously evaluated. 

2. The proposed amendment does not 
create the possibility of a new or different 
kind of accident from any accident previously 
evaluated. As stated above, this change does 
not result in a physical modification to the 


plant or change to the method in which any 
safety related equipment performs its 
intended function. The proposed changes to 
the headings for Technical Specifications 
3.8.1.1 and 3.8.1.2 and the clarifications to 
Technical Specifications 3.8.1.1.a and 3.8.1.2.b 
improve the operability requirements for AC 
power sources stated in these specifications 
by more explicitly stating the requirements. 
The revised technical specifications continue 
to provide the necessary power sources both 
during operation and while shutdown to 
ensure safe operation of the Brunswick 
facility. Therefore, the proposed amendment 
can not create the possibility of a new or 
different kind of accident from any accident 
previously evaluated. 

3. The proposed amendment does not 
involved a significant reduction in the margin 
of safety. This change will provide adequate 
time to perform necessary transformer 
maintenance, Inspections, and bus duct 
inspection, thereby increasing the overall 
reliability of the offsite power sources. The 
existing Technical Specifications and 
proposed additional actions are adequate to 
assure the availability of AC power to both 
units at all times. In addition, the clarification 
of Technical Specifications 3.8.1.1-a and 
3.8.1.2.b explicitly state the operability 
requirements for the AC power sources and 
help to avoid possible operator confusion. 
Based on this reasoning, the proposed 
amendment does not involve a significant 
reduction in the margin of safety. 

The NRC staff has reviewed the 
licensee's no significant hazards 
consideration determination and agrees 
with the licensee's analysis. 

Therefore, based on the above 
considerations, the staff proposes to 
determine that the application for 
amendment involves no si^iificant 
hazards consideration. 

The Commission is seeking public 
comments on this proposed 
determination. Any comments received 
within 30 days after the date of 
publication of this notice will be 
considered in making any final 
determination. The Commission will not 
normally make a final determination 
unless it receives a request for a 
hearing. 

Written comments may be submitted 
by mail to the regulatory Publications 
Branch, Division of Freedom of 
Information and Publications Services, 
Office of Administration, U.S. Nudear 
Regulatory Commission. Washington. 

DC 20555, and should dte the 
publication date and page number of 
this Federal Register notice. Written 
comments may also be delivered to 
Room P-223, Phillips Building, 7920 
Norfolk Avenue, Bethesda, Maryland 
from 7:30 a.m. to 4:15 p.m. Copies of 
written comments received may be 
examined at the NRC Public Document 
Room, the Gelman Building, 2120 L 
Street, NW„ Washington, DC. The filing 






35973 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


of requests for hearing and petitions for 
leave to intervene is discussed below. 

By October 4,1990. the licensee may 
file a request for a hearing with respect 
to issuance of the amendment to the 
subject facility operating license and 
any person whose interest may be 
affected by this proceeding and who 
wishes to participate as a party in the 
proceeding must file a written petition 
for leave to intervene. Request for a 
hearing and petitions for leave to 
intervene shall be filed in accordance 
with the Commission's “Rules of 
Practice for Domestic Licensing 
Proceedings" in 10 CFR part 2. 

Interested persons should consult a 
current copy of 10 CFR 2.714 which is 
available at the Commission's Public 
Document Room, the Celman Building, 
2120 L Street. NW„ Washington, DC 
20555 and at the Local Public Document 
Room located at the University of North 
Carolina at Wilmington. William 
Madison Randall Library, 601 S. College 
Road, Wilmington, North Carolina 
28403-3297. If a request for a hearing or 
petition for leave to intervene is filed by 
the above date, the commission or an 
Atomic Safety and Licensing Board and 
Licensing Board Panel will rule on the 
request and/or petition and the 
Secretary or the designated Atomic 
Safety and Licensing board will issue a 
notice of hearing or an appropriate 
order. 

As required by 10 CFR 2.714, a 
petition for leave to intervene shall set 
forth with particularity the interest of 
the petitioner in the proceeding, and 
how that interest may be affected by the 
results of the proceeding. The petition 
should specifically explain the reasons 
why intervention should be permitted 
with particular reference to the 
following factors: (1) The nature of the 
petitioner’s right under the Act to be 
made party to the proceeding; (2) the 
nature and extent of the petitioner's 
property, financial, or other interest in 
the proceeding; and (3) the possible 
effect of any order which may be 
entered in the proceeding on the 
petitioner’s interest the petition should 
also identify the specific a3pect(s) of the 
subject matter of the proceeding as to 
which petitioner wishes to intervene. 
Any person who has filed a petition for 
leave to intervene or who has been 
admitted as a party may amend the 
petition without requesting leave of the 
Board up to fifteen (15) days prior to the 
first prehearing conference scheduled in 
the proceeding, but such an amended 
petition must satisfy the specificity 
requirements described above. 

Not later than fifteen (15) days prior to 
the first prehearing conference schedule 


in the proceeding, a petitioner shall file 
a supplement to the petition to intervene 
which must include a list of the 
contentions which are sought to be 
litigated in the matter. Each contention 
must consist of a specific statement of 
the issue of law or fact to be raised or 
controverted. In addition, the petitioner 
shall provide a brief explanation of the 
bases of the contention and a concise 
statement of the alleged facts or expert 
opinion which support the contention at 
the hearing, the petitioner must also 
provide references to those specific 
sources and documents of which the 
petitioner is aware and on which the 
petitioner intends to reply to establish 
those facts or expert opinion. Petitioner 
must provide sufficient information to 
show that a genuine dispute exists with 
the applicant on a material issue of law 
or fact. Contentions shall be limited to 
matters within the scope of the 
amendment under consideration. The 
contention must be one which, if proven, 
w ould entitle the petitioner to relief. A 
petitioner who fails to file such a 
supplement which satisfies these 
requirements with respect to at least one 
contention will not be permitted to 
participate as a party. 

Those permitted to intervene become 
parties to the proceeding, subject to any 
limitations in the order granting leave to 
intervene, and have the opportunity to 
participate fully in the conduct of the 
hearing, including the opportunity to 
present evidence and cross-examine 
witnesses. 

If a hearing is requested, the 
Commission will make a final 
determination on the issue of no 
significant hazards consideration. The 
final determination will serve to decide 
when the hearing is held. 

If the final determination is that the 
request for amendment involves no 
significant hazards consideration, the 
Commission may issue the amendment 
and make it effective, notwithstanding 
the request for a hearing. Any hearing 
held would take place after issuance of 
the amendment. 

If a final determination is that the 
amendment involves a significant 
hazards consideration, any hearing held 
would take place before the issuance of 
any amendment. 

Normally, the Commission will not 
issue the amendment until the 
expiration of the 30-day notice period. 
However, should circumstances change 
during the notice period such that failure 
to act in a timely way would result, for 
example, in derating or shutdown of the 
facility, the Commission may issue the 
license amendment before the 
expiration of the 30-day notice period, 


provided that its final determination is 
that the amendment involves no 
significant hazards consideration. The 
final determination will consider all 
public and State comments received. 
Should the Commission take this action, 
it will publish a notice of issuance and 
provide for opportunity for a hearing 
after issuance. The Commission expects 
that the need to take this action will 
occur very infrequently. 

A request for a hearing or a petition 
for leave to intervene must be filed with 
the Secretary of the Commission, U.S. 
Nuclear Regulatory Commission, 
Washington, DC 20555. Attention: 
Docketing and Services, Branch, or may 
be delivered to the Commission's Public 
Document Room, the Gelraan Building. 
2120 L Street, NW., Washington, DC. by 
the above date. Where petitions are 
filed during the last ten (10) days of the 
notice period, it is requrested that the 
petitioner promptly so inform the 
Commission by a toll-free telephone call 
to Western Union at l-{800) 325-6900 (in 
Missouri l-{800) 342-6700). The Western 
Union operator should be given 
Datagram Identification Number 3737 
and the following message addressed to 
Elinor G. Adensam: (petitioner’s name 
and telephone number), (date petition 
was mailed), (plant name), and 
(publication date and page number of 
this Federal Register notice). A copy of 
the petition should also be sent to the 
Office of the General Counsel U.S, 
Nuclear Regulatory Commission, 
Washington. DC 20555, and to R.E. 

Jones, General Counsel, Carolina Power 
& Light Company, P.O. Box 1551, 

Raleigh, North Carolina 27602. attorney 
for the licensee. 

Nontimely filings of petitions for leave 
to intervene, amended petitions, 
supplemental petitioners and/or 
requests for hearing will not be 
entertained absent a determination by 
the Commission, the presiding officer or 
the Atomic Safety and Licensing Board 
that the petition and/or request should 
be granted based upon a balancing of 
the factors specified in 10 CFR 
2.714(a)(l)(iHv) and 2.714(d). 

For further details with respect to this 
action, see the application for 
amendment dated July 9,1990, as 
supplemented August 16 and August 21, 
1990, which is available for public 
inspection at the Commission's Public 
Document Room, the gelman Building. 
2120 L Street, NW., Washington, DC 
20555 and at the Local Public Document 
Room located at University of North 
Carolina at Wilmington, William 
Madison Randall Library, 601 S. College 
Road, Wilmington, North Carolina 
28403-3297. 








35974 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


Dated at Rockville. Maryland, this 29th day 
of August 1990. 

For the Nuclear Regulatory Commission. 
Elinor G. Adensam. 

Director, Project Directorate 11-1, Division of 
Reactor Projects—l/ll, Office of Nuclear 
Reactor Regulation. 

[FR Doc. 90-20802 Filed 8-31-90; 8:45 am) 

BILLING CODE 7S90-01-M 


[Docket Nos. 50-352, 50-353) 

Philadelphia Electric Co. (Limerick 
Generating Station, Units 1 and 2); 
Exemption 

I. 

Philadelphia Electric Company (PECo, 
the licensee) is the holder of Facility 
Operating License Nos. NPF-39 and 
NPF-65 which authorize operation of the 
Limerick Generating Station, Units 1 and 
2 at steady-state reactor power levels 
not in excess of 3293 magawatts thermal 
per unit. These licenses provide, among 
other things, that the licensee is subject 
to all rules, regulations, and Orders of 
the Nuclear Regulatory Commission (the 
Commission or NRC) now or hereafter 
in effect. 

The Limerick facility consists of two 
boiling water reactors located at the 
licensee’s site in Montgomery and 
Chester Counties, Pennsylvania. The 
licensee is also the holder of Facility 
Operating License Nos. DPR-^14 and 
DPR-56 which authorize operation of the 
Peach Bottom Atomic Power Station. 
Units 2 and 3, in Delta. Pannsylvania. 

II. 

Section 50.54(q) of 10 CFR part 50 
requires a licensee authorized to operate 
a nuclear power reactor to follow and 
maintain in effect emergency plans that 
meet the standards of 10 CFR 50.47(b) 
and the requirements of Appendix E to 
10 CFR part 50. Section IV.F.3 of 
Appendix E requires that each licensee 
at each site shall exercise with offset 
authorities such that the State and local 
govenment emergency plans for each 
operating reactor site are exercised 
biennially, with full or partial 
participation by State and local 
governments, within the plume exposure 
pathway emergency planning zone 
(EPZ). 

The NRC may grant exemptions from 
the requirements of the regulations 
which, pursuant to 10 CFR 50.12(a), are 
(1) Authorized by law, will not present 
an undue risk to the public health and 
safety, and are consistent with the 
common defense and security; and (2) 
present special circumstances. Section 
50.12(a)(2)(v) of 10 CFR part 50 indicates 
that special circumstances exist when 


an exemption would provide only 
temporary relief from the applicable 
regulation and the licensee has made 
good faith efforts to comply with the 
regulation. 

III. 

By letter dated May 16,1990, the 
licensee requested an exemption from 
the schedular requirements of Section 

IV. F.3 of Appendix E to perform a 
biennial full participation emergency 
preparedness exercise for the Limerick 
Generating Station during 1990. 
Additional information concerning the 
exemption request was provided by the 
licensee in a letter dated July 24,1990. 
The last biennial emergency 
preparedness exercise at the Limerick 
Generating Station was a full 
participation exercise conducted on 
April 5,1988. The next biennial exercise 
is currently scheduled for the week of 
September 17,1990. 

The required biennial full 
participation exercises are currently 
conducted for both the Limerick 
Generating Station and the Peach 
Bottom Atomic Power Station on an 
even-year cycle. The licensee states that 
this practice of conducting both the 
Limerick and Peach Bottom full 
participation exercises during the same 
year has caused logistical and resource 
utilization difficulties for PECo. The 
licensee, therefor, has requested that the 
upcoming Limerick exercise be 
rescheduled to a time in early 1991 
convenient to all affected parties. The 
licensee states that this change would 
alleviate the problems associated with 
conducting both the Limerick and Peach 
Bottom biennial full participation 
exercises during the same year, thereby 
enabling PECo to better allocate 
resources and address the various onsite 
and offsite non-exercise emergency 
preparedness issues that may arise for 
either facility. 

The licensee states that the proposed 
schedule changes have been discussed 
with the Pennsylvania Emergency 
Management Agency (PEMA), the three 
EPZ counties (Berks, Chester and 
Montgomery), and the two support 
counties (Bucks and Lehigh). Based on 
these discussions, the licensee states 
that these government agencies have not 
objected to rescheduling the full 
participation emergency exercise to 
1991. The licensee’s submittal included 
letters from PEMA and Bucks, 
Montgomery, and Berks Counties 
documenting their concurrence. 
Concurrence letters have not been 
received from Chester or Lehigh 
counties, however, the licensee states 
that verbal concurrence to reschedule 
the emergency execise has been 


received from those counties. In a letter 
to the licensee dated April 18,1990, 
Joseph L. LaFleur, Director, PEMA, 
stated that # * I concur that the 
current * * * schedule whereby 
Philadelphia Electric Company must 
conduct the required biennial exercise 
for both Limerick and Peach Bottom in 
the same year is indeed neither 
desirable nor in the best interest of all 
concerned.” The Federal Emergency 
Management Agency (FEMA) has also 
indicated its agreement with the 
proposed change in a letter to the Staff 
dated July 30,1990. 

The licensee informed the NRC staff 
in a letter dated July 24,1990, that, if the 
exemption is approved, the Limerick full 
participation exercise will be conducted 
in February 1991, taking into 
consideration the scheduling 
commitments of FEMA, the State, and 
local agencies. The requested exemption 
would thus postpone the limerick full 
participation exercise for a period of 
approximately five months from its 
currently scheduled date of the week of 
September 17,1990. All future biennial 
exercises for Limerick would be 
conducted on a schedule based on the 
date the rescheduled exercise is 
performed. No other emergency 
preparedness activities would be 
affected by this change. 

PECo has been conducting exercises 
at Limerick with full or partial offsite 
participation since 1984. The last full 
participation exercise for the Limerick 
facility was performed on April 5,1988. 
In its exercise report dated May 19,1988, 
FEMA identified one deficiency in the 
overall response capability of Lower 
Pottsgrove Township. A remedial 
exercise was conducted on June 14, 

1989, which corrected the deficiency. 
FEMA concluded in a report issued July 
31,1989, that, "(bjased on the results of 
the April 5,1988, full participation 
exercise and the June 14,1989, remedial 
exercise, the offsite radiological 
emergency preparedness for Limerick 
Generating Station is adequate to 
provide reasonable assurance that 
appropriate measures can be taken to 
protect the health and safety of the 
public in the event of an accident.” 

The Commonwealth of Pennsylvania 
is an active participant in emergency 
preparedness exercises with all of the 
nuclear power plants located within the 
State. In addition to Limerick, 
Pennsylvania has participated in full 
and partial participation exercises with 
Peach Bottom, Three Mile Island, Beaver 
Valley, and Susquehanna. In 1990, 
Pennsylvania has fully participated in 
exercises at Peach Bottom (on February 
7,1990) and Beaver Valley (on May 1, 








Federal Register / Vol. 55, No. 171 / Tuesday. September 4. 1990 / Notices 35973 


1990). In addition, one of the Limerick 
EPZ counties (Chester) participated in 
the 1990 Peach Bottom exercise. 

The last annual onsite emergency 
preparedness exercise at Limerick was 
conducted on November 21.1989. In 
Inspection Report Nos. 50-352/89-20 
and 89-29, the NRC concluded that the 
licensee's response actions for the 
exercise were adequate to provide 
protective measures for the health and 
safety of the public. The Commonwealth 
of Pennsylvania participated on a 
limited basis in the exercise. 

The licensee states that if the 
exemption is approved, the licensee 
plans to conduct a limited partial 
participation exercise in conjunction 
with its scheduled annual onsite 
exercise during September or November 
1990. The State and local governments 
will be able to participate in the 
exercise if they so desire for training 
purposes. Further. PECo states that they 
intend to continue to provide training to 
the appropriate State and local 
government agencies to ensure that the 
current high level of preparedness is 
maintained. 

IV. 

Based on a consideration of the facts 
presented in Section III above, the NRC 
staff finds that the following factors 
support the granting of the requested 
exemption: 

a. The capability of the 
Commonwealth of Pennsylvania and 
local government agencies to respond to 
an emergency at Limerick has been 
adequately demonstrated in previous 
exercises at Limerick. FEMA has found 
that there is reasonable assurance that 
appropriate measures can be taken to 
protect the health and safety of the 
public in the event of a radiological 
accident at Limerick. 

b. The Commonwealth of 
Pennsylvania maintains a high level of 
preparedness through its participation in 
exercises with each of the nuclear 
power plants located in the State which, 
for 1990, will include two full 
participation exercises. 

c. The licensee has maintained an 
acceptable level of onsite emergency 
preparedness and will conduct an onsite 
exercise in September 1990. The State 
and local governments will have the 
opportunity to participate in this 
exercise at their option. 

d. The requested change will allow 
the licensee to better allocate its 
resources between the Limerick and 
Peach Bottom facilities, thereby 
improving its overall emergency 
preparedness capability. 


e. FEMA. State and local agencies 
have indicated their agreement with the 
proposed exercise schedule change. 

The requested exemption is a 
temporary one which will result in 
postponing the biennial full participation 
exercise for approximately five months. 
The exemption will relieve the licensee, 
and the Commonwealth of 
Pennsylvania, of the burden of 
conducting both the Limerick and Peach 
Bottom biennial full participation 
exercises during the same calendar year, 
thereby resulting in a more efficient 
allocation of resources. The licensee has 
made a good faith effort to comply with 
the regulations by conducting the 
required full participation exercises at 
Limerick with State and local 
government agencies since 1984. The 
licensee has taken into consideration 
the various concerns of FEMA PEMA 
and the local governments in 
rescheduling the Limerick exercise. All 
affected parties support the proposed 
exercise schedule change. 

V. 

For these reasons the Commission has 
determined that, pursuant to 10 CFR 
50.12(a)(2), the Exemption requested by 
the licensee’s letter of May 18,1990, as 
supplemented July 24.1990, is authorized 
by law, will not present an undue risk to 
the public health and safety, and is 
consistent with the common defense and 
security. 

Accordingly, the Commission hereby 
approves the following Exemption: 

The Limerick Generating Station is exempt 
from the requirements of 10 CFR part 50, 
appendix E. section IV.F.3, for the conduct of 
a biennial offsite full participation emergency 
preparedness exercise in 1990. provided that 
such an exercise be conducted prior to July 1, 
1991. 

Pursuant to 10 CFR 51.32, the 
Commission has determined that the 
granting of this Exemption will have no 
significant effect on the quality of the 
human environment (55 FR 34633). A 
copy of the licensee’s request for 
Exemption dated May 16,1990, as 
supplemented July 24,1990, is available 
for public inspection at the 
Commission's Public Document Room, 
in the Gelman Building, Lower Level, 
2120 L Street NW., Washington, DC, and 
at the Limerick Local Public Document 
Room located at Pottstown Public 
Library, 500 High Street, Pottstown. PA 
19464. 

Copies may be obtained upon written 
request to the U.S. Nuclear Regulatory 
Commission, Washington, DC 20555, 
Attention: Director, Division of Reactor 
Projects-I/II. 

This exemption is effective upon 
issuance. 


Dated At Rockville. Maryland this 27lh day 
of August 1990. 

For the Nuclear Regulatory Commission. 
Steven A Varga, 

Director, Division of Reactor Projects — l/ll. 
Office of Nuclear Reactor Regulation, 

[FR Doc. 90-20709 Filed 8-31-90; 8:45 am) 

BILLING COOE 7590-01-M 


NUCLEAR WASTE TECHNICAL 
REVIEW BOARD 

Meeting 

action: Notice of meeting. 

summary: Pursuant to its authority 
under section 5051 of Public Law 100- 
203, the Nuclear Waste Policy 
Amendments Act of 1987 (NWPAA), the 
Transportation A Systems Panel of the 
Nuclear Waste Technical Review Board 
(the Board) will hold a public hearing to 
obtain the views of the public on 
transportation issues under study by the 
Board as part of its review of the 
Department of Energy’s (DOE) program 
to site and develop a permanent 
repository for the disposal of spent 
nuclear fuel and high-level radioactive 
waste. 

The Transportation A Systems Panel 
held its first hearing (under the auspices 
of its former title "Transportation 
Panel") on August 17,1990. in Amargosa 
Valley (Nye County). Nevada. A second 
hearing is scheduled to be held on 
November 19.1990, in Reno, Nevada. 
This notice announces the date and 
location of the second hearing, provides 
procedures for participating in the 
hearing, and lists some of the issues that 
participants may want to address in 
their remarks before the panel. 

Members of the public are welcome to 
make their views known by (1) 

Preparing written testimony in advance 
of the hearing and presenting it before 
the panel, or (2) speaking briefly on a 
walk-in basis before the panel, or (3) 
submitting a written statement for the 
record. Those requesting to speak before 
panel members should be prepared to 
answer questions. A transcript of the 
hearing will be made. 

Requests to testify should be made in 
writing to Ms. Paula N. Alford, Director, 
External Affairs, Nuclear Waste 
Technical Review Board, 1100 Wilson 
Boulevard, suite 910, Arlington. Virginia 
22209: (703) 235-4473. Requests to testify 
must be received no later than close of 
business October 24,1990. 

Requests to speak briefly before the 
panel on a walk-in basis will be taken 
on the day of the hearing. Persons 
wanting to make a brief statement 











33976 


Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


before the panel are asked to appear at 
the Peppermill Hotel in Reno. Nevada, 
on the day of the hearing to sign up for a 
five-minute time slot on a first-come, 
first-served basis. 

In lieu of appearing before the panel, 
interested persons may also submit 
written comments until November 30, 
1990. Original statements should be 
submitted to Chair, Transportation & 
Systems Panel, Nuclear Waste 
Technical Review Board, 1100 Wilson 
Boulevard, suite 910, Arlington, Virginia 
22209. 

dates: The date and time of the hearing 
are: Monday, November 19,1990, from 9 
a.m.-5 p.m. 

addresses: The hearing will be held at 
the Peppermill Hotel, 2707 South 
Virginia Street, Reno, Nevada 89502; 
(702) 826-2121. 

FOR FURTHER INFORMATION CONTACT: 

Ms. Paula N. Alford, Director, External 
Affairs, Nuclear Waste Technical 
Review Board, 1100 Wilson Boulevard, 
suite 910, Arlington, Virginia 22209; (703) 
235—4473. 

SUPPLEMENTARY INFORMATION: 

Purpose 

The Nuclear Waste Technical Review 
Board (NWTRB) was established by the 
Nuclear Waste Policy Amendments Act 
of 1987 (Pub. L 100-203) to evaluate the 
scientific and technical validity of 
activities undertaken by the Department 
of Energy in its civilian nuclear waste 
disposal program. The waste to be 
disposed of consists primarily of 
commercial spent fuel with some 
defense high-level waste. While the 
Board’s charge is broad, the Act 
specifically directs the Board to 
evaluate activities relating to repository 
siting and the packaging and 
transportation of high-level radioactive 
waste or spent nuclear fuel. 

To facilitate the evaluation of 
transportation issues pertaining to spent 
nuclear fuel and high-level radioactive 
waste, the Board created the 
Transportation & Systems Panel 
(formerly known as the Transportation 
Panel). As part of its study of safety 
issues related to nuclear waste 
transportation, the panel intends to hold 
several public hearings over the next 
two years in various locations around 
the country. The purpose of the hearings 
will be to obtain the views and concerns 
of persons who would be affected by the 
transportation of spent fuel or high-level 
waste once a waste disposal program is 
in operation. 

To maximize public participation, 
hearing locations are being selected in 
regions that may see significant waste 


transport activity once the disposal 
program becomes operational. In the 
PWPAA of 1987, the U.S. Congress 
directed the DOE to characterize Yucca 
Mountain, Nevada, as a potential 
repository for the permanent disposal of 
spent nuclear fuel and high-level 
radioactive waste. Although the 
proposed geologic repository under 
study is located in the West, the 
majority of the nation's spent nuclear 
fuel is stored at commercial reactors 
located in the East. Therefore, if the 
Yucca Mountain Site were found to be 
suitable for repository development, a 
majority of the nation's spent fuel would 
be transported from the East to the 
West. 

In recognition of the potential increase 
in transportation of spent nuclear fuel 
through Nevada that would occur if the 
Yucca Mountain Site were found to be 
suitable as a permanent repository, the 
Transportation & Systems Panel is 
holding its first two hearings there. 
Future hearings will be held in other 
locations around the country through 
which significant amounts of spent 
nuclear fuel are likely to be shipped. 

Presentation Procedures 

Requests to testify should be made in 
writing to Ms. Paula N. Alford, Director, 
External Affairs, NWTRB, 1100 Wilson 
Boulevard, suite 910, Arlington, Virginia 
22209. The written request should 
specify the following: 

1. Name of the person testifying 

2. Title, if any 

3. Name of organization, if any 

4. Telephone number 

5. Length of time requested for presentation 

(time limit will be determined once all 

requests have been received) 

If the contact person is different from 
the person testifying, please provide his 
or her name, title (if any), organization 
name (if any), and telephone number. 
Requests to testify must be received no 
later than October 24,1990. 

Persons testifying are asked to 
provide 10 copies of their testimony and 
any accompanying slides or other 
documentation by ciose of business on 
November 9,1990, to the NWTRB, 1100 
Wilson Boulevard, suite 910, Arlington, 
Virginia 22209. Persons testifying also 
are asked to bring 50 copies to the 
hearing. 

The Transportation & Systems Panel 
will reserve time in addition to the 
scheduled presentations to hear the 
views of interested persons scheduled 
on a first-come, first-served basis. 
Presenters in this part of the hearing do 
not need to notify the panel in advance 
of their plans to attend, but they will be 


required to sign up the day of the 
hearing at the Peppermill Hotel, 2707 
South Virginia Street, Reno, Nevada 
89502; (702) 826-2121. 

To accommodate those wishing to 
make presentations, and to allow for 
questions from panel members, a time 
limit will be placed on scheduled and 
walk-in presentations. The amount of 
time permitted for each presentation 
will depend on the number of requests 
the panel receives. Those testifying will 
be notified of time constraints following 
receipt of their written requests. Walk-in 
presenters will be advised of their time 
constraints when they sign up. All 
participants should be prepared to 
answer questions from the panel. A 
transcript of the hearing will be made. 

Issues 

To date, panel members and other 
members of the Board have met with 
representatives of the Department of 
Energy (DOE) and the Nuclear 
Regulatory Commission (NRC) to 
discuss safety and risk assessment 
issues associated with the 
transportation of spent nuclear fuel and 
high-level radioactive waste. In its First 
Report to the U.S. Congress and the U.S. 
Secretary of Energy, the Board made a 
number of recommendations to the DOE 
on the following transportation issues: 
System safety, human factors 
engineering, and risk assessment and 
management. These issues were 
selected in part because of their 
importance in the early stages of 
transportation system planning. 
Consequently, the Transportation & 
Systems Panel encourages comments 
from parties particularly interested in 
the following areas. 

• System Safety is a management 
approach that involves applying safety 
engineering and management techniques 
to the design of transportation system 
hardware, software, and operations: The 
central question is, in what ways and to 
what extent should the DOE dedicate its 
management resources to such 
transportation safety activities? 

• Human Factors Engineering 
involves applying what we know about 
human psychological, physiological, and 
physical limitations to the design and 
operation of industrial systems to 
optimize system safety and operability: 
The central question is, how can human 
error be reduced in the design, 
fabrication, maintenance, and operation 
of a transport system? 

• Risk Assessment and Management 
involves the development and use of 
analytical methods to estimate the 
probability and severity of safety 





Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35977 


hazards that may be encountered in 
spent fuel transportation and to 
methodically foresee and develop 
measures to prevent their occurrence: 
The central question is, how can the 
existing risk assessment tools be 
improved; are the needs of the users— 
including state, tribal, and local 
government planners—being considered 
sufficiently? 

In addition to these early safety 
management and planning issues, the 
panel invites comments on safety 
considerations that will become 
increasingly important as the system for 
transporting spent nuclear fuel and high- 
level radioactive waste becomes more 
clearly defined and established. Safety 
issues that will grow in importance 
include: 

• Transportation Cask Integrity: The 
question is, can transportation 
containers be designed and constructed 
to prevent the release of radioactive 
material under normal and accident 
conditions? If so, how can public 
confidence in transportation safety be 
enhanced? 

• Transportation Operations: One of 
the main questions is, are current 
routing criteria adequate? If so, how can 
inspection and enforcement measures 
be improved? 

• Emergency Preparedness: The 
central question is, what contingency 
plans need to be in place in communities 
located along routes used to transport 
spent nuclear fuel and high-level waste? 

Dated: August 25,1990. 

William D. Barnard, 

Executive Director, Nuclear Waste Technical 
Review Board. 

|FR Doc. 90-20650 Filed 0-31-90; 8:45 am] 

BILLING CODE 6820-AM-M 


OFFICE OF PERSONNEL 
MANAGEMENT 

Federal Prevailing Rate Advisory 
Committee; Open Committee Meeting 

According to the provisions of section 
10 of the Federal Advisory Committee 
Act (Pub. L. 92-463), notice is hereby 
given that meetings of the Federal 
Prevailing Rate Advisory Committee 
will be held on— 

Wednesday, October 10,1990 
Thursday, October 25,1990 
Thursday, November 29,1990 

The meeting will start at 10:30 a.m. 
and will be held in room 5A06A, Office 
of Personnel Management Building, 1900 
E Street, NW., Washington, DC. 

The Federal Prevailing Rate Advisory 
Committee is composed of a Chairman, 
representatives from five labor unions 


holding exclusive bargaining rights for 
Federal blue-collar employees, and 
representatives from five Federal 
agencies. Entitlement to membership on 
the Committee is provided for in 5 U.S.C. 
5347. 

The Committee’s primary 
responsibility is to review the Prevailing 
Rate System and other matters pertinent 
to establishing prevailing rates under 
subchapter IV, chapter 53, 5 U.S.C., as 
amended, and from time to time advise 
the Office of Personnel Management. 

These scheduled meetings will start in 
open session with both labor and 
management representatives attending. 
During the meeting either the labor 
members or the management members 
may caucus separately with the 
Chairman to devise strategy and 
formulate positions. Premature 
disclosure of the matters discussed in 
these caucuses would unacceptably 
impair the ability of the Committee to 
reach a consensus on the matters being 
considered and would disrupt 
substantially the disposition of its 
business. Therefore, these caucuses will 
be closed to the public because of a 
determination made by the Director of 
the Office of Personnel Management 
under the provisions of section 10(d) of 
the Federal Advisory Committee Act 
(Pub. L. 92-463) and 5 U.S.C. 
552b(c)(9)(B). These caucuses may. 
depending on the issues involved, 
constitute a substantial portion of the 
meeting. 

Annually, the Committee publishes for 
the Office of Personnel Management, the 
President, and Congress a 
comprehensive report of pay issues 
discussed, concluded recommendations, 
and related activities. These reports are 
available to the public, upon written 
request to the Committee’s Secretary. 

The public i3 invited to submit 
material in writing to the Chairman on 
Federal Wage System pay matters felt to 
be deserving of the Committee’s 
attention. Additional information on 
these meetings may be obtained by 
contacting the Committee’s Secretary, 
Office of Personnel Management, 

Federal Prevailing Rate Advisory 
Committee, room 1340,1900 E Street, 
NW.. Washington, DC 20415 (202) 606- 
1500. 

Dated: August 27,1990. 

Anthony F. Ingrassia, 

Chairman, Federal Prevailing Rate Advisory 
Committee. 

[FR Doc. 90-20705 Filed 8-31-90; 8:45 am] 

BILLING CODE 6325-01-M 


DEPARTMENT OF STATE 

[Public Notice 1253] 

Office of the Procurement Executive, 
Department of State Metric Program 

ACTION: Public Notice 1253. 

addresses: Department of State, Office 
of the Procurement Executive. SA-6, 
room 603, Washington. DC 20522-0606. 
FOR FURTHER INFORMATION CONTACT: 
John F. Black, Office of the Procurement 
Executive, (703) 875-7042. 
supplementary INFORMATION: Section 
5164 of the Omnibus Trade and 
Competitiveness Act of 1988 (Pub. L 
100-418) designates the metric system of 
measurement as the preferred system of 
weights and measures for U.S. trade and 
commerce. The law requires that 
Federal agencies use the metric system 
in procurements, grants, and other 
business-related activities by a date 
certain and to the extent economically 
feasible by the end of fiscal year 1992. 
The law also requires that Federal 
.. agencies establish guidelines for 
implementing the metric system of 
measurement. 

Publication of this notice serves to 
inform the public, particularly 
commercial firms doing business with 
DOS, of the Department’s intent to use 
the metric system of measurement in its 
procurements, grants, and other 
business-related activities, to the extent 
feasible, by the end of fiscal year 1992. 

The Department of State has 
established the required policy 
guidelines for transition from the 
traditional system to the metric system 
of weights and measurements. A copy of 
the Department of State Metric System 
Implementation Policy is available to 
those interested persons who submit a 
written request to the above address. 

Dated: August 17.1990. 

John J. Conway, 

Procurement Executive. 

[FR Doc. 90-20643 Filed 8-31-90; 8:45 am] 

BILLING CODE 4710-M 


DEPARTMENT OF TRANSPORTATION 

Aviation Proceedings; Agreements 
Filed During the Week Ended August 
24,1950 

The following Agreements were Filed 
with the Department of Transportation 
under the provisions of 49 U.S.C. 412 
and 414. Answers may be filed within 21 
days of date of filing. 

Docket number: 47139. 

Dote filed: August 24,1990. 












35978 


Federal Register / VoL 55. No. 171 / Tuesday. September 4. 1990 / Notices 


Parties: Members of the International 
Air Transport Association. 

Subject: South America-Southwest 
Pacific Resolutions et al. 

Proposed effective date: October 1, 
199a 

Docket number: 47140. 

Date filed: August 24.1990. 

Parties: Members of the International 
Air Transport Association. 

Subject: Reso G33F—Cargo Rates/ 
Minimum Charges From Lebanon. 

Proposed effective date: Once 
Government Approvals have been 
Received. 

Phyllis T. Kaylor, 

Chief, Documentary Services Division. 

|FR Doc. 90-20692 Filed 8-31-90; 8:45 am] 

B4LLING CODE 4910-62-11 


Notice of Applications for Certificates 
of Public Convenience and Necessity 
and Foreign Air Carrier Permits Filed 
Under Subpart Q During the Week 
Ended August 24,1990 

The following applications for 
certificates of public convenience and 
necessity and foreign air carrier permits 
were filed under subpart Q of the 
Department of Transportation’s 
Procedural Regulations (see 14 CFR 
302.1701 et 6eq.). The due date for 
answers, conforming application, or 
motion to modify scope are set forth 
below for each application. Following 
the answer period DOT may process the 
application by expedited procedures. 


Such procedures may consist of the 
adoption of a show-cause order, a 
tentative order, or in appropriate cases a 
final order without further proceedings. 
Docket Number: 47135. 

Date Filed: August 22,1990. 

Due Date for Answers, Conforming 
Applications, or Motion to Modify 
Scope: September 19,1990. 

Description: Application of 
Continental Airlines. Inc. pursuant to 
section 401 of the Act and subpart Q of 
the regulations, for amendment of its 
certificate of public convenience and 
necessity for Route 561, issued by Order 
89-6-21 to provide scheduled foreign air 
transportation of persons, property and 
mail between Phoenix. Arizona and Los 
Angeles, California, on the one hand, 
and Mexico City. Mexico on the other. 
Phyllis T. Kaylor, 

Chief, Documentary Services Division. 

[FR Doc. 90-20693 Filed 8-31-90, 8:45 am] 

BILLING CODE 4910-62-41 


Urban Mass Transportation 
Administration 

UMTA Section 3 and 9 Grant 
Obligations 

AGENCY: Urban Mass Transportation 
Administration (UMTA], DOT. 
action: Notice. 

summary: The Department of 
Transportation and Related Agencies 
Appropriations Act, 1990, Public Law 
101-164, signed into law by President 

Section 3 Grants 


George Bush on November 21,1989, 
contained a provision requiring the 
Urban Mass Transportation 
Administration to publish 
announcement in the Federal Register 
every 30 days of grants obligated 
pursuant to sections 3 and 9 of the 
Urban Mass Transportation Act of 1964, 
as amended. The statute requires that 
the announcement include the grant 
number, the grant amount, and transit 
property receiving each grant. This 
notice provides the information as 
required by statute. 

FOR FURTHER INFORMATION CONTACT: 

Janet Lynn Sahaj, Chief, Resource 
Management Division. Office of Capital 
and Formula Assistance, Department of 
Transportation, Urban Mass 
Transportation Administration, Office of 
Grants Management 400 Seventh Street 
SW., room 9301. Washington. DC 2059a 
(202) 366-2053. 

SUPPLEMENTARY INFORMATION: This 
section 3 program was established by 
the Urban Mass Transportation Act of 
1964 to provide capital assistance to 
eligible recipients in urban areas. 
Funding for this program is distributed 
on a discretionary basis. The section 9 
formula program was established by the 
Surface Transportation Assistance Act 
of 1982. Funds appropriated to this 
program are allocated on a formula 
basis to provide capital and operating 
assistance in urbanized areas. Pursuant 
to the statute UMTA reports the 
following grant information: 


Transit property 

Grant No. 

Grant 

amount 

Obligation 

date 

City of Phoenix, Phoenix, AZ. 

AZ-03-0014-00 

3,000,000 

4,249.998 

2,630,499 

12£490 

881,000 

671.841 

8,983,372 

940,914 

5,633,861 

08/15/90 

08/09/90 

08/09/90 

07/31/90 

07/23/90 

07/27/90 

07/13/90 

07/25/90 

08/09/90 

Mass Transit Administration. Baltimore, MD. 

MD-03-0035-01 

Mass Transit Administration, Baltimore. MD... 

MD-03-0046-01 

City of Phonix, Phoenix, AZ....... 

AZ-90-X019-02 

City of Visalia, Visalia, CA....... 

Louisiana Department of Transportation & Development, New Orleans, LA_ 

Suburban Mobility Authority for Regional Transportation, Detroit, Ml___.._ 

Greater Roanoke Transit Company, Roanoke, VA. 

Pierce County Public Transportation Benefit Area, Tacoma, WA. 

CA-90-X374-00_ 

LA-90-X108-00 -. 

MI-90-X122-00. 

VA-90-X074-00_ 

WA-90-X105-00. 


Issued on: August 27.1990. 

Roland ]. Mross, 

Deputy Administrator. 

|FR Doc. 90-20637 Filed 8-31-90; 8:45 am] 

BILLING CODE 4910-57-41 


DEPARTMENT OF THE TREASURY 
Office of Thrift Supervision 
(LN-4/2J 

Appointment of Conservator; 
Ambassador Federal Savings and 
Loan Association 

Notice is hereby given that, pursuant 
to the authority contained in section 


5(d)(2) (B) and (H) of the Home Owners’ 
Loan Act of 1933, as amended by section 
301 of the Financial Institutions Reform, 
Recovery and Enforcement Act of 1989, 
the Office of Thrift Supervision has duly 
appointed the Resolution Trust 
Corporation as sole Conservator for 
Ambassador Federal Savings and Loan 
Association, Tamarac, Florida on 
August 24.1990. 

Dated: August 27.1990. 










































Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Notices 


35979 


By the Office of Thrift Supervision. 
Debra J. Aheam, 

Program Analyst. 

[FR Doc. 90-20686 Filed 8-31-90; 8:45 am] 

BILLING CODE 6720-01-M 


[LN-4/2] 

Appointment of Conservator; Broken 
Arrow Savings Association, F.A. 

Notice is hereby given that, pursuant 
to the authority contained in section 
5(d)(2) (B) and (H) of the Home Owners’ 
Loan Act of 1933, as amended by section 
301 of the Financial Institutions Reform. 
Recovery and Enforcement Act of 1989, 
the Office of Thrift Supervision has duly 
appointed the Resolution Trust 
Corporation as sole Conservator for 
Broken Arrow Savings Association, 

F.A., Broken Arrow, Oklahoma on 
August 24,1990. 

Dated: August 27,1990. 

By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst. 

(FR Doc. 90-20687 Filed 8-31-90; 8:45 am] 

BILLING CODE 6720-01-M 


[LN-4/2] 

Appointment of Conservator, First 
Savings and Loan Association, F.A. 

Notice is hereby given that, pursuant 
to the authority contained in Section 
5(d)(2) (B) and (H) of the Home Owners’ 
Loan Act of 1933, as amended by section 
301 of the Financial Institutions Reform. 
Recovery and Enforcement Act of 1989, 
the Office of Thrift Supervision has duly 
appointed the Resolution Trust 
Corporation as sole Conservator for 
First Savings and Loan Association, 

F.A., Temple, Texas, on August 24,1990. 
Dated: August 27,1990. 

By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst. 

[FR Doc. 90-20688 Filed 8-31-90; 8:45 am] 

BILLING CODE 6720-01-M 


1LN-4/1] 

Appointment of Receiver; Ambassador 
Savings and Loan Association 

Notice is hereby given that, pursuant 
to the authority contained in section 
5(d)(2)(C) of the Home Owners’ Loan 
Act of 1933, as amended by section 301 
of the Financial Institutions Reform, 
Recovery and Enforcement Act of 1989, 
the Office of Thrift Supervision has duly 
appointed the Resolution Trust 
Corporation as sole Receiver for 


Ambassador Savings and Loan 
Association, Tamarac, Flordia, on 
August 24,1990. 

Dated: August 27.1990. 

By the Office of Thrift Supervision. 
Debra J. Aheam, 

Program Analyst. 

[FR Doc. 90-20679 Filed 8-31-90; 8:45 am] 

BILLING COOE 6720-01-M 


[LN-4/1J 

Appointment of Receiver, Broken 
Arrow Federal Savings and Loan 
Association 

Notice is hereby given that, pursuant 
to the authority contained in section 
5(d)(2)(A) of the Home Owners’ Loan 
Act of 1933, as amended by section 301 
of the Financial Institutions Reform, 
Recovery and Enforcement Act of 1989, 
the Office of Thrift Supervision has duly 
appointed the Resolution Trust 
Corporation as sole Receiver for Broken 
Arrow Federal Savings and Loan 
Association, Broken Arrow, Oklahoma 
on August 24,1990. 

Dated: August 27,1990. 

By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst 

[FR Doc. 90-20680 Filed 8-31-90; 8:45 am] 
BILLING CODE 6720-01-M 


[LN-4/1] 

Appointment of Receiver; Chlliicothe 
Federal Savings and Loan Association 

Notice is hereby given that, pursuant 
to the authority contained in section 5 
(d)(2)(F) of the Home Owners* Loan Act 
of 1933, as amended by section 301 of 
the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989, 
the Office of Thrift Supervision has duly 
appointed the Resolution Trust 
Corporation as sole Receiver for 
Chillicothe Federal Savings and Loan 
Association, Chillicothe, Illinois. Docket 
No. 3416, on August 24.1990. 

Dated: August 27,1990. 

By the Office of Thrift Superv ision. 

Debra J. Aheam, 

Program Analyst. 

[FR Doc. 90-20681 Filed 8-31-90; 8:45 am] 
BILUNG COOE 6720-01-M 


ILN-4/1] 

Appointment of Receiver; First Federal 
Savings and Loan Association 

Notice is hereby given that, pursuant 
to the authority contained in section 5 


(d)(2)(A) of the Home Owners’ Loan Act 
of 1933, as amended by section 301 of 
the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989, 
the Office of Thrift Supervision has duly 
appointed the Resolution Trust 
Corporation as sole Receiver for First 
Federal Savings and Loan Association, 
Temple, Texas, Docket No. 3349. on 
August 24, 1990. 

Dated: August 27.1990. 

By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst. 

[FR Doc. 90-20G02 Filed 8-31-SO; 8:45 am] 
BILLING COOE 6720-01-M 


[LN-4/1] 

Appointment of Receiver; Heritage 
Savings Association F.A. 

Notice is hereby given that, pursuant 
to the authority contained in § 5(d)(2)(F) 
of the Home Owners' Loan Act of 1933, 
as amended by § 301 of the Financial 
Institutions Reform, Recovery and 
Enforcement Act of 1989, the Office of 
Thrift Supervision has duly appointed 
the Resolution Trust Corporation as sole 
Receiver for Heritage Savings 
Association, F.A., Jerseyville, Illinois, 
Docket No. 8658, on August 24,1990. 

Dated: August 27,1990. 

By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst 

[FR Doc. 90-20C83 Filed 8-31-90; 8:45 am| 

BILLING COOE 6720-01-M 


[LN-4/1 

Appointment of Receiver, Investment 
Federal Savings and Loan Association 

Notice is hereby given that, pursuant, 
to the authority contained in section 5 
(d)(2)(F) of the Home Owners’ Loan Act 
of 1933, as amended by section 301 of 
the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989, 
the Office of Thrift Supervision has duly 
appointed the Resolution Trust 
Corporation as sole Receiver for 
Investment Federal Savings and Loan 
Association, Woodland Hills, California, 
Docket No. 8735, on August 24,1990. 

Dated: August 27.1990. 

By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst 

[FR Doc. 90-20684 Filed 8-31-90; 8:45 am] 

BILLING COOE 6720-01-M 















35980_Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Notices 


ILN-4/1] [LN-4/1] [LN-4/1] 


Appointment of Receiver; Jefferson 
Savings and Loan Association 

Notice is hereby given that, pursuant 
to the authority contained in section 
5(d)(2)(F) of the Home Owners’ Loan 
Act of 1933, as amended by section 301 
of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989, 
The Office of Thrift Supervision has 
duly appointed the Resolution Trust 
Corporation as sole Receiver for 
Jefferson Savings and Loan Association, 
Beaumont, Texas, Docket No. 6882, on 
August 24,1990. 

Dated: August 27,1990. 

By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst. 

|FR Doc. 90-20685 Filed 8-31-90, 8:45 am] 
BILLING CODE 6720-01-H 


Replacement of Conservator With a 
Receiver, Lakeland Savings Bank, 
F.S.B. 

Notice is hereby given that pursuant 
to the authority contained in subdivision 
(F) of section 5(d)(2) of the Home 
Owners’ Loan Act of 1933, as amended 
by section 301 of the Financial 
Institutions Reform, Recovery and 
Enforcement Act of 1989, the Office of 
Thrift Supervision duly replaced the 
Resolution Trust Corporation as 
Conservator for Lakeland Savings Bank, 
F.S.B., Detroit Lakes, Minnesota 
(“Association"), with the Resolution 
Trust Corporation as sole Receiver for 
the Association on August 24.1990. 
Dated: August 27. 199a 
By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst. 

[FR Doc. 90-20690 Filed 8-31-90, 8:45 am] 

BILLING CODE 6720-01-■ 


Replacement of Conservator With a 
Receiver; Westwood Savings and Loan 
Association 

Notice is hereby given that, pursuant 
to the authority contained in subdivision 
(F) of section 5(d)(2) of Home Owners’ 
Loan Act of 1933, as amended by section 
301 of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989, 
the Office of Thrift Supervision duly 
replaced the Resolution Trust 
Corporation as Conservator for 
Westwood Savings and Loan 
Association, Los Angeles, California 
("Association"), with the Resolution 
Trust Corporation as sole Receiver for 
the Association on August 24,1990. 

Dated: August 27,1990. 

By the Office of Thrift Supervision. 

Debra J. Aheam, 

Program Analyst 

(FR Doc. 90-20689 Filed 8-31-90: 845 am] 

BILLING CODE 6720-01-M 















35981 


Sunshine Act Meetings 


Federal Register 

Vol. 55, No. 171 
Tuesday, September 4, 1990 


This section of the FEDERAL REGISTER 
contains notices of meetings published 
under the “Government in the Sunshine 
Act* *’ (Pub. L 94-409) 5 U.S.C. 552b(e)(3 ). 


UNIFORMED SERVICES UNIVERSITY OF THE 
HEALTH SCIENCES 

Meeting Notice 

TIME AND DATE: 8:00 a.m.. September 24, 
1990. 

PLACE: Uniformed Services University of 
the Health Sciences, Room D3-001,4301 
Jones Bridge Road, Bethesda, Maryland 
20814-4799. 

STATUS: Open—under “Government in 
the Sunshine Act” (5 U.S.C. 552b(e)(3)). 

MATTERS TO BE CONSIDERED: 

8:00 a.m. Meeting—Board of Regents 

(1) Approval of Minutes—July 9,1990; 

(2) Faculty Matters; (3) Report— 
Admissions; (4) Report—Associate 
Dean for Operations; (5) Report— 
Dean, Military Medicine Education 
Institute; (6) Report—Nursing School 
Task Force; (7) Report—Oversight and 
Planning Committees; (8) Report— 
President, USUHS; (9) Comments— 
Members, Board of Regents; (10) 
Comments—Chairman, Board of 
Regents 
New Business 

SCHEDULED MEETINGS: October 29,1990. 
CONTACT PERSON FOR MORE 

information: Charles R. Mannix, 
Executive Secretary of the Board of 
Regents, 202/295-3028. 

Dated: August 30,1990. 

LM. Bynum, 

Alternate OSD Federal Register Liaison 
Officer, Department of Defense. 

(FR Doc. 90-20830 Filed 8-30-90; 1:02 pm] 

BILUNG COOE 3810--01-M 


FEDERAL DEPOSIT INSURANCE 
CORPORATION 

Notice of Agency Meeting 

Pursuant to the provisions of the 

* Government in the Sunshine Act“ (5 
U.S.C. 552b), notice is hereby given that 
at 2:18 p.m. on Tuesday, August 28,1990, 
the Board of Directors of the Federal 
Deposit Insurance Corporation met in 
closed session to consider the following 
matters: 


Matters relating to the probable failure of 
certain insured banks. 

Recommendation concerning 
administrative enforcement proceedings. 

Request of Wauwatosa Savings and Loan 
Association, Wauwatosa, Wisconsin, 
regarding its voluntary withdrawal from 
membership in the Federal Home Loan Bank 
system. 

Personnel matters. 

Matter relating to the Corporation’s 
corporate activities. 

In calling the meeting, the Board 
determined, on motion of Director C.C. 
Hope, Jr. (Appointive), seconded by 
Director Robert L. Ciarke (Comptroller 
of the Currency), concurred in by 
Director T. Timothy Ryan. Jr. (Director 
of the Office of Thrift Superv ision), Vice 
Chairperson Andrew C. Hove, Jr., and 
Chairman L. William Seidman, that 
Corporation business required its 
consideration of the matters on less than 
seven days’ notice to the public; that no 
earlier notice of the meeting was 
practicable; that the public interest did 
not require consideration of the matters 
in a meeting open to public observation; 
and that the matters could be 
considered in a closed meeting by 
authority of subsections (c)(2), (c)(4), 
(c)(6), (c)(8), (c)(9)(A)(ii), (c)(9)(B). and 
(c)(10) of the “Government in the 
Sunshine Act” (5 U.S.C. 552b(c)(2), (c)(4), 
(c)(6). (c)(8), (c)(9)(A)(ii), (c)(9)(B). and 
(c)(10)). 

The meeting was held in the Beard 
Room of the FDIC Building located at 
550—17th Street NW., Washington, D.C. 

Dated: August 29,1990. 

Federal Deposit Insurance Corporation. 

M. Jane Williamson, 

Assistant Executi ve Secretary. 

(FR Doc. 90-20768 Filed 8-29-90; 5:08 pm] 

BILLING COOE 6714-01-M 


INTERSTATE COMMERCE COMMISSION 

Commission Voting Conference 

TIME AND DATE: 10:00 a.m., Tuesday, 
September 11,1990. 

place: Hearing Room A, Interstate 
Commerce Commission. 12th & 
Constitution Avenue, NW., Washington, 
DC. 20423. 


status: The purpose of the conference 
is for the Commission to discuss among 
themselves, and to vote on, the agenda 
items. Although the conference is open 
for the public observation, no public 
participation is permitted. 

MATTERS TO BE DISCUSSED: 

No. 39169, Shippers Committee, OT-5 v. 
The Ann Arbor Railroad, et al. 

No. AB-321X, Kansas City Public 
Service Freight Operation — 
Abandonment Exemption—in Jackson 
County, MO 

Finance Docket No. 31908, PSI Energy, 
Inc.—Feeder Line Development — 
Norfolk Southern Cap., Line Between 
Cynthiana and Carol IN 
Finance Docket No. 31281, Arkansas & 

Missouri Railroad Company v. 
Missouri Pacific Railroad Company. 

CONTACT PERSON FOR MORE 

information: A. Dennis Watson. Office 
of External Affairs. Telephone: (202) 
275-7252. TDD: (202) 275-1721. 

Sidney L. Strickland, Jr., 

Secretary. 

(FR Doc. 90-20829 Filed 8-30-90; 1:02 pm) 
BILUNG CODE 7035-01-M 


RESOLUTION TRUST CORPORATION 

Notice of Agency Meeting 

Pursuant to the provisions of the 
“Government in the Sunshine Act” (5 
U.S.C. 552b), notice is hereby given that 
at 3:15 p.m. on Tuesday, August 28,1990, 
the Board of Directors of the Resolution 
Trust Corporation met in closed session 
to consider matters relating to the 
resolution of failed thrift institutions. 

In calling the meeting, the Board 
determined, on motion of Director C.C. 
Hope, Jr. (Appointive), seconded by 
Director Robert L. Clarke (Comptroller 
of the Currency), concurred in by 
Chairman L. William Seidman, Vice 
Chairman Andrew C. Hove, and 
Director T. Timothy Ryan, Jr. (Director 
of the Office of Thrift Supervision), that 
Corporation business required its 














35982 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Sunshine Act Meetings 


consideration of the matters on less than 
seven days’ notice to the public; that no 
earlier notice of the meeting was 
practicable; that the public interest did 
not require consideration of the matters 
in a meeting open to public observation; 
and that the matters could be 
considered in a closed meeting by 
authority of subsections (c)(8). (c)(9)(A), 
and (c)(9)(B) of the “Government in the 
Sunshine Act” (5 U.S.C. 552b (c)(8), 
(c)(9)(A), and (c)(9)(B)). 

The meeting was held in the Board 
Room of the Federal Deposit Insurance 
Corporation Building located at 550 17th 
Street, NW., Washington, DC. 

Dated: August 29,1990. 

Resolution Trust Corporation. 

William J. Tricarico, 

Assistant Executive Secretary . 

|FR Doc. 90-20769 Filed 8-29-90; 5:08 pm] 

BILUNG COOE 6714-01-11 







35983 


Corrections 


i ■ ■ ■ ■■ ■■■ ■ ■ ■ 

Federal Register 

Vol. 55, No. 171 

Tuesday. September 4. 1990 


This section of the FEDERAL REGISTER 
contains editorial corrections of previously 
published Presidential, Rule. Proposed 
Rule, and Notice documents. These 
corrections are prepared by the Office of 
the Federal Register. Agency prepared 
corrections are issued as signed 
documents and appear in the appropriate 
document categories elsewhere in the 
issue. 


FEDERAL MARITIME COMMISSION 

46 Part 540 

[Docket No. 90-01] 

Security for the Protection of the 
Public, Maximum Required 
Performance Amount 

Correction 

In rule document 90-19824 beginning 
on page 34564 in the issue of Thursday, 
August 23,1990, make the following 
correction: 

On page 34564, in the first column, the 
‘ EFFECTIVE date” is corrected to read 
"February 19,1991.” 

BILLING CODE 150$-01-0 


DEPARTMENT OF THE INTERIOR 

Bureau of Land Management 

[Docket No. CA-065-09-3110-10-DTNA,*0- 
00160] 

Realty Action-Exchange; California 

Correction 

In notice document 90-15015 beginning 
on page 26515 in the issue of Thursday, 
June 28.1990, make the following 
correction: 


On page 26515 in the third column, in 
the third line, the land description 
should read "Sec. 5. NWttSWttSEtt, 
NW V4SW V 4 SW W. 

BILUNG CODE 15C5-01-0 


DEPARTMENT OF THE INTERIOR 

Bureau of Land Management 

I CO-932-00-4214-10; C-43908] 

Proposed Withdrawal; Opportunity for 
Public Meeting; Colorado 

Correction 

In notice document 90-19574 
appearing on page 34089 in the issue of 
Tuesday, August, 211990, make the 
following correction: 

On page 34089 in the second column 
under the Sixth Principal Meridian 
heading, in section 27, the land 
description should read "SVfeNEVi and 
SVfc". 

BILUNG CODE 1505-01-D 


DEPARTMENT OF THE INTERIOR 

Bureau of Land Management 

[ WY-930-00-4214-10; WYW 120797] 

Proposed Withdrawal and Opportunity 
for Public Meeting; Wyoming 

Correction 

In notice document 90-19495 
appearing on page 33964 in the issue of 
Monday, August 20 1990, make the 
following corrections: 

In the second column, under the land 
description for "Medicine Bow National 
Forest”: 


a. At section 17 remove the comma 
after ”WW. 

b. At section 12, replace the final 
semicolon with a comma and add 
“SE’ASEW’. 

c. At section 13, in the first line, 
remove the final "NEW and add 
”NW W. 

d. At section 13 in the second line, the 
first "NWW should read "NEW. 

e. At section 25, in the first line, 
"NWW should read "NW W. 

f. At section 33, in the last line, "SEW 
should read "SEW. 

BILLING CODE 1505-01-D 


DEPARTMENT OF TRANSPORTATION 
Coast Guard 

33 CFR Parts 127 and 154 

46 CFR Parts 25, 32, 34, 50, 52, 53, 54, 
55, 56, 57, 58, 59, 71, 76, 91, 92, 95, 107, 
108, 150,153, 162, 163,169, 170, 174, 
182,189,190, and 193 

[CGD 88-032] 

RIN2115AD05 

Incorporation and Adoption of 
Industry Standards 

Correction 

In proposed rule document CO-19235 
beginning on page 33824 in the issue of 
Firday, August 17,1990, make the 
following correction: 

On page 33825, in the second column, 
under "discussion of regulations 

PROPOSED FOR TITLE 46, CFR”, in the 

second paragraph, in the thirteenth line, 
"SAE J-1923” should read ”SAE J-1928”. 

BILLING COOE 1505-01-0 









































































































































































Tuesday 

September 4, 1990 



Part II 

Department of 
Transportation 

Coast Guard 

33 CFR Parts 151, 155, and 158 
46 CFR Part 25 

Regulations Implementing the Pollution- 
Prevention Requirements of Annex V of 
MARPOL 73/78; Final Rule 







































35986 Federal Register / Vol. 55. No. 171 / Tuesday. September 4, 1990 / Rules and Regulations 


DEPARTMENT OF TRANSPORTATION 
Coast Guard 

33 CFR Parts 151,155, and 158 

46 CFR Part 25 
[CGD 88-002] 

RIN 2115-AC89 

Regulations Implementing the 
Pollution-Prevention Requirements of 
Annex V of MARPOL 73/78 

agency: Coast Guard, DOT. 
action: Final rule. 

summary: This Final rule implements the 
Act to Prevent Pollution from Ships (the 
Act), as amended by the Marine Plastic 
Pollution Research and Control Act of 
1987 (MPPRCA) and by Public Law 101- 
225, having taken account of comments 
received on the interim rule published 
on April 28,1989 [54 FR 18384]. This 
Final rule ultimately implements Annex 
V of the International Convention for 
the Prevention of Pollution from Ships, 
1973, as modified by the Protocol of 1978 
(MARPOL 73/78). The Coast Guard 
expects that this rule will reduce the 
amount of plastics, including synthetic 
fishing nets, and other ship-generated 
garbage intentionally discharged into 
the marine environment. 

EFFECTIVE DATE: September 4,1990. 

addresses: 1 . A Final Regulatory 
Evaluation, a final Environmental 
Assessment, and copies of the 
comments received on the Advance 
Notice of Proposed Rulemaking 
(ANPRM), the Notice of Proposed 
Rulemaking (NPRM), and the interim 
rule are available for inspection and 
copying at the office of the Marine 
Safety Council, U.S. Coast Guard, Room 
3314, 2100 Second Street SW., 
Washington, DC 20593-0001. Office 
hours are between 8:00 a.m. and 3:00 
p.m., Monday through Friday, except 
Federal holidays. 

2. Persons wanting to submit 
comments on the information-collection 
requirement in this Final rule should 
submit them to the Office of Information 
and Regulatory Affairs, Office of 
Management and Budget, 725 17th Street 
NW., Washington, DC 20503, Attention: 
Desk Officer, Coast Guard. 

FOR FURTHER INFORMATION CONTACT. 

Lieutenant Commander David W. Jones. 
Project Manager, Office of Marine 
Safety, Security, and Environmental 
Protection (G-MPS-3). (202) 267-0491. 
between 7 a.m. and 3:30 p.m., Monday 
through Friday, except Federal holidays. 


SUPPLEMENTARY INFORMATION: 

Drafting Information 

The principal persons involved in 
drafting this final rule are Lieutenant 
Commander David W. Jones, Project 
Manager, OfFice of Marine Safety, 
Security, and Environmental Protection, 
and Mr. Patrick J. Murray, Project 
Counsel, Office of Chief Counsel. 

Background 

The Coast Guard published an 
ANPRM in the Federal Register on June 
24,1988 (53 FR 23884), and an NPRM in 
the Federal Register on October 27,1988 
(53 FR 43622). Further, it published two 
minor correctional notices in the Federal 
Register, on November 4,1988 (53 FR 
44617), and November 21.1988 (53 FR 
46977). 

The Coast Guard held three public 
hearings to give interested persons an 
opportunity to express their views on 
the NPRM. These hearings took place in 
Washington, DC (November 10,1988), 
Houston, Texas (November 14,1988), 
and Seattle, Washington (November 15, 
1988). 

The Coast Guard published an interim 
rule, with a request for comments, in the 
Federal Register on April 28,1989 (54 FR 
18384). That interim rule is the basis for 
this final rule. The comment period for 
the interim rule closed on December 31, 
1989. 

Discussion of Comments and Changes 

The Coast Guard published an interim 
rule (in a separate rulemaking, CGD 89- 
014), which implements the Shore 
Protection Act of 1988, in the Federal 
Register on May 24,1989 (54 FR 22546). 
That rule, among other things, 
reorganizes 33 CFR part 151, but it 
makes no substantive changes to the 
interim rule that is the basis of this Fmal 
rule. 

The latter interim rule, which 
implements the Act, published on April 
28.1989, reserves 33 CFR 151.55,151.57, 
and 151.59, which regard, respectively, 
recordkeeping requirements, waste- 
management plans, and placards, and 
which all regard pollution by garbage. 
The Coast Guard published an NPRM on 
these topics (in yet another separate 
rulemaking, CGD 88-002A) in the 
Federal Register on September 6,1989 
(54 FR 37084), and it published an 
interim final rule and a request for 
comments on these topics (also in CGD 
88-002A) in the Federal Register on May 
2,1990 (55 FR 18578). That rule, among 
other things, makes formal, 
administrative changes to the interim 
rule that is the basis of this final rule, to 
bring it into conformity with the 
reorganization of part 151. 


33 CFR Part 151—Vessels Carrying Oil, 
Noxious Liquid Substances, Garbage, 
and Municipal or Commercial Waste 

33 CFR 151.04 Penalties for Violations 

1. One comment suggested that the 
civil penalties for violation of the 
regulations are too high and are 
disproportionate to the environmental 
harm caused by such violation. 

The penalties listed in the regulations 
merely repeat the penalties established 
by the Act; these penalties are ceilings. 
Final penalties are determined by 
Hearing Officers of the Coast Guard 
after consideration of relevant factors. 

33 CFR 151.05 Definitions 

2. One comment suggested that the 
definition of “Plastic” proposed at 

§ 151.05 was too broad and could be 
construed to include material not 
intended by the Coast Guard. The 
comment pointed out that paper could 
come within the definition of plastic and 
that so could plastics derived from 
natural sources, such as crabshells and 
other plastic-like material that appear 
normally in the marine environment. 

The Coast Guard agrees that the 
definition, by itself, does seem to 
include naturally produced plastics 
discharged during the catching or 
processing of fish. The intent of the 
Coast Guard, to exclude this material, 
was clear enough in the preamble to the 
NPRM. There the Coast Guard stated, at 
54 FR 18387: 

Some plastic materials are produced 
naturally in the marine environment by living 
organisms. For example, chitin is a primary 
component of the shells of crabs, shrimp and 
lobsters, among others. The Coast Guard’s 
broad definition of plastic is intended to 
regulate synthetically produced plastics, 
including chitin-derived and other plastics 
which have been harvested and adopted for 
use by man. Several European nations are 
now manufacturing packaging materials for 
personal hygiene products which are 
primarily chitin-derived. While this rule is 
intended to prohibit the discharge from ships 
of synthetically produced plastics, it is not 
intended to regulate the discharge of 
naturally produced plastics during fishery 
activities, such as crabshells and others 
which appear in the marine environment. 

Even so, the Coast Guard has amended 
its definition of plastic to square 
definition with intent. Likewise, it has 
amended the note following the 
definition to clarify the status of 
“naturally produced plastics”. 

The Coast Guard still does not agree 
that either the old or the new definition 
of plastic fairly includes material such 
as paper. Both Annex V of MARPOL 
and the interim rule, as did the NPRM. 











Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35987 


employ distinct categories for plastic 
and paper. 

3. One comment suggested expanding 
the definition of “Plastic" to include 
glass, paints, varnishes, and waxes. 

Discharges and releases of these 
substances are the concern of other 
statutes, such as the Clean Water Act 
(33 U.S.C. 1251 et seq.) and the 
Comprehensive Environmental 
Response, Compensation, and Liability 
Act (42 U.S.C. 9601 et seq .). 

4. One comment suggested expanding 
the definition of “Port" to cover 
transfers from ship to ship offshore. The 
author was worried that, if fish- 
processing ships refused to accept 
garbage from the catcher vessels 
supplying them with fish, the catcher 
vessels would be unable to retain their 
garbage on board. The comment 
recommended that the definition 
classify these processing ships and 
similar operations as ports, so they 
would have to provide reception 
facilities for the catcher vessels (or other 
ships they were doing business with). 

The Coast Guard has investigated this 
issue and has not uncovered any reports 
of difficulty in compliance offshore with 
the discharge requirements of Annex V. 
The Coast Guard conducts routine 
boardings of ships in fisheries offshore 
and will continue to monitor compliance 
there with Annex V. If, in the future, 
these boardings indicate a failure of 
such compliance, the Coast Guard will 
undertake appropriate enforcement or 
regulation. 

33 CFR 151.C8 Denial of Entry 

5. One comment expressed confusion 
over the applicability of this section. 

Section 151.08 applies to all three 
Annexes in force, I, II, and V. Paragraph 
(a) of § 151.08 authorizes denial of entry 
to ships under Annexes I and II. 
Paragraph (b) of § 151.08 authorizes 
denial, by the Captain of the Port, of 
entry to ships at ports or terminals not 
in compliance with Annex V. 

33 CFR 151.63 Shipboard Control of 
Garbage 

6. One comment suggested that ships 
be required to furnish both equipment 
for treating garbage and spaces for 
handling it. 

The approach used by the Coast 
Guard in developing these regulations 
was to establish performance standards 
but to let the affected industry and the 
public choose the methods they would 
use to meet those standards. The Coast 
Guard believes that this approach lets 
the United States meet the 
environmental standards of Annex V 
and yet provides the flexibility for those 
regulated to meet the performance 


standards in the most economical 
manner. 

7. One comment recommended further 
study of shipboard use of incinerators. 

The Coast Guard presided over a 
working group of the American Society 
for Testing and Materials (ASTM), 
which developed a proposed standard 
for small shipboard incinerators. The 
standard is now going through the 
approval process of ASTM. 

8. One comment recommended 
subjecting ships to State and local 
requirements for the separation of 
waste-stream components. 

The Coast Guard has published an 
interim final rule that addresses these 
topics, among others, in a separate 
rulemaking, CGD 88-002A (55 FR 18578). 
In that rule, the Coast Guard requires 
that placards listing the garbage- 
discharge restrictions of Annex V be 
displayed by certain ships. The placards 
must include a notice that regional, 

State, and local restrictions on garbage 
discharges may also apply. 

33 CFR 151.69 Operating 
Requirements: Discharge of Garbage 
Outside Special Areas 

9. One comment suggested that a 
policy of “zero tolerance" would be 
appropriate for the disposal of garbage 
at sea, and two suggested that the rules 
prohibiting the discharge of unground 
victual wastes within three nautical 
miles from the nearest land are too 
severe and pose a hardship. 

Like the NPRM and the interim rule, 
this final rule tracks the standards 
established by Annex V of MARPOL 
and adopted by Congress in the Act. 

The discharge of refuse within three 
nautical miles from the nearest land has 
long been prohibited by the Refuse Act 
(33 U.S.C. 407). 

33 CFR 151.73 Operating 
Requirements: Discharge of Garbage 
From Fixed or Floating Platforms 

10. Two comments stated that the 
more restrictive rules for the discharge 
of victual waste from fixed or floating 
platforms lack basis in biological 
science and create an unreasonable 
burden for the offshore exploration, 
exploitation, and processing of minerals. 

Congress adopted the provisions of 
Annex V as domestic law in approving 
the Act, and the Coast Guard has merely 
restated these provisions in 
promulgating this final rule. Because of 
the specificity of Regulation 4 of Annex 
V, the Coast Guard cannot alter the 
requirements for discharges of garbage 
from fixed or floating platforms. 


33 CFR 151.77 Exceptions for 
Emergencies 

11. One comment recommended literal 
conformity between the text of 
paragraph 151.77(c) and that of Annex 
V. 

The Coast Guard finds no substantive 
difference between the language of 
paragraph 151.77(c) and that of Annex 
V. 

12. One comment asked that the Coast 
Guard either identify text in the 
MPPRCA that restricts it from 
undertaking programs to recover lost 
fishing gear or else undertake such 
programs. 

Title IV of MPPRCA addresses 
monitoring, assessing, and controlling 
the impact of driftnets on the marine 
environment. Title IV falls under the 
responsibility of the Department of 
Commerce. It requires the Secretary of 
Commerce to conduct several 
evaluations including both (a) studies of 
the feasibility of establishing systems of 
marking, registering, and identifying 
driftnets and (b) paying bounties for 
retrieved driftnets. Neither these 
evaluations nor any resultant legislative 
or regulatory action falls under the 
responsibility of the Coast Guard. 

33 CFR Part 158—Reception Facilities 
for Oil, Noxious Liquid Substances, and 
Garbage 

33 CFR 156.160 Purpose 

13. One comment recommended 
adding language to require inspections 
of reception facilities after the issuance 
of their Certificates of Adequacy 
(COAs). 

The Coast Guard believes adding such 
language is unnecessary. It already 
conducts annual surveys and 
inspections of waterfront facilities and 
already visits other facilities in the 
course of routine business. The Act does 
not require it to inspect reception 
facilities under Annex V, and another 
mandatory inspection would place an 
economic burden on the regulated 
industry and an administrative one on 
the Coast Guard—which will, 
nonetheless, promptly investigate 
reports of inadequate reception 
facilities. 

33 CFR 158.165 Certificate of 
Adequacy: Change of Information 

14. The Coast Guard has made an 
editorial correction to subparagraph 
(b)(3) of § 158.185. The interim rule 
improperly listed the sections of Form C 
as: Al, Bl, B2, or C4. This final rule 
properly lists them as: Al. Bl, B2, or D4. 









35988 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


33 CFR 158.410 Reception Facilities: 
General 

15. One comment recommended that 
the Coast Guard require the posting of 
signs to locate and identify each 
reception facility. 

Responding to comments on the 
NPRM, the Coast Guard has earlier 
amended this subpart to require that 
reception facilities be accessible to 
mariners: easy for mariners unfamiliar 
with the port to find, and convenient for 
them to use. The Coast Guard has not 
received any comments stating that 
reception facilities were hard to find or 
awkward to use. Therefore, the Coast 
Guard does not believe it necessary to 
require the posting of such signs. 

Regulatory Evaluation 

The Coast Guard considers this final 
rule not to be major under Executive 
Order 12291 though to be significant 
under DOT regulatory policies and 
procedures published on February 26, 
1979 [44 FR11034]. This final rule 
clarifies, but does not otherwise alter, 
the interim rule published on April 28, 
1989 [54 FR 18384]. The annual projected 
costs remain around $41.8 million; the 
annual projected benefits, while harder 
to quantify, should exceed these. A final 
Regulatory Evaluation is in the 
rulemaking docket The Evaluation is 
available for inspection and copying at 
the address indicated in the first 
paragraph of ADDRESSES above. 

Regulatory Flexibility Act 

The Coast Guard has analyzed 
regulatory flexibility to evaluate the 
impact of this final rule on small 
entities. It has made its analysis part of 
the final Regulatory Evaluation in 
accordance with the Regulatory 
Flexibility Act. Again, this final rule 
clarifies, but does not otherwise alter, 
the interim rule published on April 28, 
1989 [54 FR 18384). Like the interim rule, 
this final rule will affect around 17,600 
small vessels and around 4,400 ports 
and terminals; but small entities may 
choose their modes of compliance, and 
need satisfy only minimal requirements 
on recordkeeping and reporting. 
Therefore, the Coast Guard certifies that 
this final rule will not have a significant 
economic impact or a substantial 
number of small entities. 

Paperwork Reduction Act 

The interim rule changed the 
information-collection requirement at 
§ § 151.65 and 158.140. This final rule 
changes it no further. The Coast Guard, 
however, did submit to the Office of 


Management and Budget (OMB) 
revisions to OMB’s previous paperwork 
approvals. These revisions, now 
accepted, respectively bear control 
numbers 2115-0544 and 2115-0543, 
issued by the Regulatory Information 
Service Center (RISC) of OMB. Those 
sections respectively require (a) each 
master to give a port 24 hours’ notice of 
the need for the APHIS-approved 
reception facility and (b) each port and 
terminal that satisfies the criteria of 
§ 158.140 to seek from the Coast Guard a 
COA for garbage. 

Federalism 

The Coast Guard has analyzed this 
final rule in accordance with the 
principles and criteria in Executive 
Order 12612. It has determined that the 
substance of this rule does not implicate 
federalism enough to warrant its 
preparation of a Federalism 
Assessment. 

Environmental Impact 

A final Environmental Assessment, 
with a Finding of No Significant Impact, 
is available from the Coast Guard at the 
address in the first paragraph of 
ADDRESSES above. 

List of Subjects 

33 CFR Part 151 

Oil pollution, Reporting and 
recordkeeping requirements, Water 
pollution control. 

33 CFR Part 155 

Oil pollution. Reporting and 
recordkeeping requirements. 

33 CFR Part 158 

Administrative practice and 
procedure. Harbors, Oil pollution. 
Penalties, Reporting and recordkeeping 
requirements, Water pollution control. 

46 CFR Part 25 

Fire prevention. Marine safety. 

For the reasons discussed above, the 
interim rule amending 33 CFR parts 151, 
155, and 158, and 46 CFR part 25, which 
was published on April 28,1989 [54 FR 
18384], is adopted as a final rule with 
the following changes: 

TITLE 33 

PART 151—VESSELS CARRYING OIL, 
NOXIOUS LIQUID SUBSTANCES, 
GARBAGE, AND MUNICIPAL OR 
COMMERCIAL WASTE 

1. The citation of authority for part 151 
continues to read as follows: 


Authority: 33 U.S.C. 1321(j)(l)(C) and 
1903(b), E.0.11735. 3 CFR. 1971-1975 COMP 
p. 793, 49 CFR 1.48. 

2. Section 151.05 is amended by 
adding the following definition: 

§ 151.05 Definitions. 

« • • * * 

Plastic means any garbage that is 
solid material, that contains as an 
essential ingredient one or more 
synthetic organic high polymers, and 
that is formed or shaped either during 
the manufacture of the polymer or 
polymers or during fabrication into a 
finished product by heat or pressure or 
both. “Degradable” plastics, which are 
composed of combinations of 
degradable starches and are either (a) 
synthetically produced or (b) naturally 
produced but harvested and adapted for 
use, are plastics under this part. 
Naturally produced plastics such as 
crabshells and other types of shells, 
which appear normally in the marine 
environment, are not plastics under this 
part 

Note: Plastics possess material properties 
ranging from hard and brittle to soft and 
elastic. Plastics are used for a variety of 
marine applications including, but not limited 
to: food wrappings, products for personal 
hygiene, packaging [vaporproof barriers, 
bottles, containers, and liners), ship 
construction (fiberglass and laminated 
structures, siding, piping insulation, flooring, 
carpets, fabrics, adhesives, and electrical and 
electronic components), disposable eating- 
utensils and cups (including styrene 
products), bags, sheeting, floats, synthetic 
fishing nets, monofilament fishing line, 
strapping bands, hardhats, and synthetic 
ropes and lines. 


PART 158—RECEPTION FACILITIES 
FOR OIL, NOXIOUS LIQUID 
SUBSTANCES, AND GARBAGE 

3. The citation of authority for part 158 
continues to read as follows: 

Authority: 33 U.S.C. 1903(b); 49 CFR 1.46. 

4. Section 158.165(b)(3) is revised to 
read as follows: 

§ 158.165 Certificate of adequacy: change 
of Information. 

• • * * • 

(b) ‘ * * 

(3) Form C, sections Al, Bl, B2, or D4. 

* ft * • « 

Dated: June 26,1990. 

J. W. Rime. 

Admiral U.S . Coast Guard Commandant 
[FR Doc. 90-20663 Filed 0-31-90; 8:45 am] 

BILLING CODE 4S10-14-M 







Tuesday, 

September 4, 1990 


Part III 

Department of 
Health and Human 
Services 

Health Care Financing Administration 

42 CFR Parts 412 and 413 
Medicare Program; Changes to the 
Inpatient Hospital Prospective Payment 
System and Fiscal Year 1991 Rates; Final 































Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rule 3 and Regulations 


DEPARTMENT OF HEALTH AND 
HUMAN SERVICES 

Health Care Financing Administration 
42 CFR Parts 412 and 413 
[BPD-673-F] 

RIN 0938-AE56 

Medicare Program; Changes to the 
Inpatient Hospital Prospective 
Payment System and Fiscal Year 1991 
Rates 

AGENCY: Health Care Financing 
Administration (HCFA), HHS. 
action: Final rule. 

summary: We are revising the Medicare 
inpatient hospital prospective payment 
system to implement necessary changes 
arising from legislation and our 
continuing experience with the system. 
In addition, in the Addendum to this 
Final rule, we are describing changes in 
the amounts and factors necessary to 
determine prospective payment rates for 
Medicare inpatient hospital services. In 
general, these changes are applicable to 
discharges occurring on or after October 
1.1990. W'e also set forth rate-of- 
increase limits for hospitals and hospital 
units excluded from the prospective 
payment system. 

This final rule also responds to 
comments received concerning changes 
to hospital payments made in an April 
20,1990 final rule with comment. These 
changes include mid-year changes to the 
inpatient hospital prospective payment 
system that implemented provisions of 
the Omnibus Budget Reconciliation Act 
of 1989; and adjustments applicable to 
prospective payment hospitals and to 
the target amounts of hospitals and units 
excluded from the prospective payment 
system due to the elimination of the day 
limitation on covered inpatient hospital 
days made by the Medicare 
Catastrophic Coverage Act of 1988 and 
later repealed by provisions in the 
Medicare Catastrophic Repeal Act of 
1989. The April 20,1990 final rule with 
comment also incorporated changes to 
these provisions made by the Family 
Support Act of 1988, which clarified the 
criteria for adjusting the target amounts 
and implementation date. 

In addition, this final rule clarifies the 
documentation requirements necessary 
to support the cost allocation of teaching 
physicians and the allowability of costs 
for rotating residents in determining 
payment for the direct costs of an 
approved graduate medical education 
program. This clarification is being 
made as a result of a September 29,1989 
final rule that made changes in 


Medicare policy concerning payment for 
the direct graduate medical education 
costs of providers associated with 
approved residency programs in 
medicine, osteopathy, dentistry, and 
podiatry. 

effective DATE: The provisions of this 
final rule are effective on October 1, 
1990, except for the changes concerning 
§ 412.118, the count of full-time 
equivalent residents for purposes of the 
indirect medical education adjustment, 
which apply to cost reporting periods 
beginning on or after July 1,1991. 

FOR FURTHER INFORMATION CONTACT: 
Barbara Wynn, (301) 968-4529. 
ADDRESSES: To obtain individual copies 
of this document, contact the following: 
Superintendent of Documents, U.S. 
Government Printing Office, 

Washington, DC 20402, (202) 783-3238. 
The charge for individual copies is $1.50 
for each issue or for each group of pages 
as actually bound, payable by check or 
money order to the Superintendent of 
Documents. 

SUPPLEMENTARY INFORMATION: 

I. Background 

A. Summary 

Under section 1886(d) of the Social 
Security Act (the Act), a system of 
payment for acute inpatient hospital 
stays under Medicare Part A (Hospital 
Insurance) based on prospectively-set 
rates was established effective with 
hospital cost reporting periods beginning 
on or after October 1,1983. Under this 
system. Medicare payment is made at a 
predetermined, specific rate for each 
hospital discharge. All discharges are 
classified according to a list of 
diagnosis-related groups (DRGs). The 
regulations governing the inpatient 
hospital prospective payment system 
are located in 42 CFR Part 412. 

B. Summary of December 29, 1989 
Notice 

On September 1,1989, we published a 
final rule (54 FR 36452) to implement the 
seventh year of the prospective payment 
system. However, on December 19,1989, 
the Omnibus Budget Reconciliation Act 
of 1989 (Pub. L. 101-239) was enacted. 

The portions of sections 6001, 6002, 6003, 
6004, 6021, 6110, and 8205 of Public Law 
101-239 that affected Medicare 
payments to hospitals in Federal fiscal 
year (FY) 1990 and that were self- 
implementing, were announced in a 
Federal Register notice published on 
December 29.1989 (54 FR 53754). These 
statutory changes provided for the 
following: 

• For discharges occurring on or after 
January 1,1990 and before October 1, 
1990, the applicable percentage increase 


used to update the standardized 
amounts for prospective payment 
system hospitals is— 

—9.72 percent for hospitals located in rural 

areas: 

—5.62 percent for hospitals located in large 

urban areas; and 

—4.97 percent for hospitals located in other 

urban areas. 

(The increase in the target amount for 
excluded hospitals and units was not 
changed and, therefore, continues to be 
5.5 percent.) 

• Effective for portions of cost 
reporting periods or discharges 
occurring during the period beginning 
January 1,1990 and ending September 
30,1990, payments for capital-related 
costs of inpatient services of hospitals 
under the prospective payment system 
are reduced by 15 percent. 

• For cost reporting periods beginning 
on or after October 1,1989, the hospital- 
specific rate of sole community hospitals 
is updated by the percentage increase 
applicable to the geographic area in 
which the hospital is located. This 
increase is applicable to discharges 
occurring on or after January 1,1990. 

• Hospitals that were classified as 
rural referral centers as of September 30. 
1989 continue to be classified as rural 
referral centers for cost reporting 
periods beginning on or after October 1, 
1989 and before October 1,1992. 

• Hospitals classified as cancer 
hospitals are excluded from the 
prospective payment system effective 
with cost reporting periods beginning on 
or after October 1,1989. The reduction 
for payment of capital costs is 
eliminated for hospitals classified as 
cancer hospitals as of December 19,1989 
efffective for portions of cost reporting 
periods or discharges occurring on or 
after October 1,1986. For hospitals 
classified after December 19,1989, the 
reduction for payment of capital costs is 
eliminated for cost reporting periods 
beginning on or after the date of 
classification. Special provisions were 
also made for hospitals that qualify for 
cancer status before December 31,1990 
(or before December 31,1991 for 
hospitals located in States operating a 
demonstration project under section 
1814(b) of the Act as of December 19, 
1989). Effective January 18,1990, a 
cancer hospital is eligible to receive 
periodic interim payments if it meets the 
criteria for receiving these payments. 

For cost reporting periods beginning on 
or after April 1,1989, the base year for 
determining target amounts for cancer 
hospitals is to be the hospital’s cost 
reporting period beginning during FY 
1987 unless the use of its initial base 









Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 35991 


year and intervening updates creates a 
higher target amount. 

• Effective for discharges occurring 
on or after January 18.1990, a hospital 
created by the merger or consolidation 
of two or more hospitals or hospital 
campuses eligible to receive interim 
periodic payments is also eligible to 
receive periodic interim payments. 

C. Summary of April20, 1990 Final Rule 
With Comment 

On April 20,1990, we published a final 
rule with comment (55 FR 15150) to 
implement those portions of sections 
6003, 6011, 6015, and 6205 of Public Law 
101-239 that affect Medicare payments 
to hospitals and that were, in general, 
effective April 1,1990. These changes 
provided for the following: 

• For discharges occurring on or after 
April 1,1990, hospitals located in rural 
areas with more than 100 beds, or those 
that are classified as sole community 
hospitals, can now qualify for a 
disproportionate share adjustment if the 
hospital has a disproportionate patient 
percentage of at least 30 percent. In 
addition, the disproportionate share 
payment adjustments for qualifying 
hospitals are increased. 

• For cost reporting periods beginning 
on or after April 1,1990, the payment 
methodology for sole community 
hospitals is revised. In addition, the 
change made in the September 1,1989 
prospective payment system final rule 
(54 FR 36480) that went into effect on 
October 1,1989 to allow any rural 
hospital to qualify as a sole community 
hospital if it is more than 35 miles from 
another hospital is ratified. 

• For cost reporting periods beginning 
on or after April 1,1990 and ending on 
or before March 31,1993, a special 
payment method under the prospective 
payment system for Medicare- 
dependent small rural hospitals is 
established. 

• For discharges occurring on or after 
April 1,1990, the wage index applicable 
to rural counties whose hospitals are 
deemed urban is revised. 

• For dicharges occurring on or after 
June 19,1990 and before December 19. 
1991, prospective payment hospitals 
receive an additional payment for the 
cost of administering blood clotting 
factors to hemophiliacs who are hospital 
inpatients. 

• For cost reporting periods beginning 
on or after April 1,1990, excluded 
hospitals and units may be assigned a 
new base period for purposes of the 
rate-of-increase limits if it would be 
more representative of the reasonable 
and necessary costs of inpatient 
services. 


• For cost reporting periods beginning 
on or after December 19,1989 and 
before the later of October 1,1990 or the 
date the Secretary issues new 
regulations concerning payment for 
nursing and allied health education, the 
costs incurred by hospitals that meet 
certain criteria for training nursing 
students enrolled in a hospital-based 
nursing school are to be paid on the 
basis of reasonable cost. 

In addition, in the April 20,1990 final 
rule with comment, we responded to 
comments received on the September 30, 
1988 prospective payment system Final 
rule with comment (53 FR 38476) with 
respect to the implementation of two 
provisions of the Medicare Catastrophic 
Coverage Act of 1988 (Pub. L 100-360) 
concerning adjustments to the rates, 
weights, and outlier thresholds 
applicable to prospective payment 
hospitals and the target amounts 
applicable to hospitals and units 
excluded from the prospective payment 
system due to the elimination of the day 
limitation on covered inpatient hospital 
days. We also discussed changes in law 
made by the Family Support Act of 1988 
(Pub. L. 100-485), which clarified the 
criteria for adjusting target amounts and 
changed the date for implementing that 
provision, as well as the termination of 
these catastrophic provisions effective 
January 1,1990 because of the 
enactment of the Medicare Catastrophic 
Coverage Repeal Act of 1989 (Pub. L. 
101-234). The comment period for the 
April 26 ,1990 final rule with comment 
period ended on June 19,1990. In section 
II of the preamble of this Final rule, we 
are responding to the comments 
received concerning the April 20,1990 
final rule. 

D. Summary of the Provisions of the 
May 9, 1990 Proposed Rule 

On May 9.1990, we published a 
proposed rule in the Federal Register (55 
FR 19426) to further amend the 
prospective payment system as follows: 

• We proposed changes for FY 1991 
DRG classifications and weighting 
factors as required by section 
1886(d)(4)(C) of the Act. We must adjust 
the DRG classifications and weighting 
factors at least annually. 

• We proposed to update the wage 
index by basing it entirely on 1988 wage 
data. 

• We proposed to recompute the 
hospital market basket, which reflects 
hospital changes in the purchase of 
goods and services used to furnish care, 
using data from a more recent base year 
(that is, “rebasing" or “reweighting" the 
market basket) and to revise the market 
basket to reflect the use of certain newly 
available price proxies for monitoring 


the rate of inflation in the market 
basket. We also proposed to establish a 
separate market basket for hospitals 
and units excluded from the prospective 
payment system. 

• We discussed several current 
provisions of the regulations in 42 CFR 
part 412 and set forth certain proposed 
changes concerning— 

—Elimination of the regional floor 
—Sole community hospital criteria; 

—Cancer hospitals; 

—Rural referral center criteria; 

—Indirect medical education costs; and 
—Offset for physician assistant services. 

• In the Addendum to the proposed 
rule, we set forth changes to the 
amounts and factors for determining the 
FY 1991 prospective payment rates. We 
also proposed new target rate 
percentages for determining the rate-of- 
increase limits for cost reporting periods 
beginning in FY 1991 for hospitals and 
hospital units excluded from the 
prospective payment system. 

• In appendix A of the proposed rule, 
we set forth an analysis of the impact 
that the proposed changes described in 
the rule would have on affected entities. 

• In appendix B of the proposed rule, 
we provided a technical discussion of 
the data sources used to estimate the 
market basket relative weights and the 
choice of price proxies. 

• In appendix C of the proposed rule 
we included our initial estimate of an 
update factor for FY 1991 for both 
prospective payment hospitals and 
hospitals excluded from the prospective 
payment system, as required by section 
1886(e)(3)(B) of the Act. 

• Appendix D of the proposed rule 
provided our recommendation of the 
appropriate percentage change for FY 
1991, as required by sections 1886 (e)(4) 
and (e)(5) of the Act, in the— 

• Large urban, other urban, and rural 
average standardized amounts for inpatient 
hospital services paid for under the 
prospective payment system; and 

• Target rate-of-increase limits to the 
allowable operating costs of inpatient 
hospital services furnished by hospitals and 
hospital units excluded from the prospective 
payment system. 

In addition, the proposed rule 
discussed in detail the March 1,1990 
recommendations made by the 
Prospective Payment Assessment 
Commission (ProPAC). ProPAC is 
directed by section 1886(d)(4)(D) of the 
Act to make recommendations to the 
Secretary with respect to adjustments to 
the DRG classifications and weighting 
factors and to report to Congress with 
respect to its evaluation of any 
adjustments made by the Secretary. 






35992 Federal Register / Vol. 55, No. 171 / Tuesday. September 4. 1990 / Rules and Regulations 


ProPAC is also directed, by the 
provisions of sections 1886(e)(2) and 
(e)(3) of the Act, to make 
recommendations to the Secretary on 
the appropriate percentage change 
factor to be used in updating the 
average standardized amounts 
beginning with FY 1986 and thereafter. 

We printed ProPAC’s report, which 
includes its recommendations, as 
Appendix E to the proposed rule (55 FR 
19426). 

Set forth below in sections III through 
VI and VIII of this preamble, the 
Addendum to this final rule, and 
appendixes A and C are detailed 
discussions of the contents of the May 9, 
1990 proposed rule, the public comments 
received in response to that proposal, 
and responses to those comments as 
well as any changes we will be making. 

Also, in section VII of the preamble of 
this Final rule we clarify the 
documentation requirements necessary 
to support the cost allocation of teaching 
physicians and the allowability of costs 
for rotating residents in determining 
payment for the direct costs of approved 
graduate medical education programs. 
This clarification is being made as a 
result of the September 29,1989 Final 
rule that made changes in Medicare 
policy concerning payment for the direct 
graduate medical education costs of 
providers associated with approved 
residency programs in medicine, 
osteopathy, dentistry, and podiatry. 
These changes implemented section 
1886(h) of the Act, which was added by 
section 9202 of the Consolidated 
Omnibus Budget Reconciliation Act of 
1985 (Pub. L. 99-272) and amended by 
section 9314 of the Omnibus Budget 
Reconciliation Act of 1986 (Pub. L. 99- 
509). 

E. Number and Types of Public 
Comments 

A total of 315 items of correspondence 
containing comments on the May 9,1990 
proposed rule were received timely. The 
main areas of concern addressed by 
commenters were the following: 

• The changes in DRG classification 
and weighting factors and lack of any 
proposal to increase payment for 
cochlear implants or inflatable penile 
implants. 

• The proposal to base the wage 
index on 1988 data only and to mitigate 
the effects of a large change in a wage 
index value. 

• The changes in the market basket 
index. 

• The revision in the interns and 
residents counting methodology for 
determining the indirect medical 
education adjustment. 


• The proposal to offset the charges 
for services of physician assistants from 
hospital DRG payments. 

II. Discussion of Public Comments 
Concerning the April 20,1990 Final Rule 
With Comment 

A number of letters were received 
timely containing comments on the 
provisions in Public Law 101-239 
included in the April 20,1990 final rule 
with comments. 

A majority of the commenters raised 
issues concerning the conditions under 
which we would approve the 
assignment of a new base period. 
Several other commenters raised issues 
concerning recognition and payment for 
hospital-based nursing school costs 
under Medicare. Four commenters had 
concerns relating to the initial 
determinations for Medicare payments 
made to sole community hospitals and 
Medicare dependent, small rural 
hospitals. Four comments were received 
that raised issues concerning 
disproportionate share adjustments and 
two commenters questioned the pricing 
of blood clotting factors for hemophilia. 
However, in general, most of the 
commenters believe the regulatory 
changes contained in the rule were 
straightforward and reflected the 
statutory language and Congressional 
intent. 

A. Disproportionate Share Adjustment 
(§412.102) 

Section 1886(d)(5)(F) of the Act 
provides for additional payments to 
prospective payment hospitals that 
serve a disproportionate share of low- 
income patients. Under section 
1886(d)(5)(F)(v) of the Act, and under 
§ 412.106(b) of the regulations for 
discharges occurring prior to April 1, 
1990, a hospital qualifies for a 
disproportionate share adjustment if 
during the hospital’s cost reporting 
period, the hospital has a 
disproportionate patient percentage that 
is at least equal to— 

• 15 percent for an urban hospital 
with 100 or more beds or a rural hospital 
with 500 or more beds; 

• 40 percent for an urban hospital 
with fewer than 100 beds; 

• 45 percent for a rural hospital with 
fewer than 500 beds. 

In addition, a hospital can qualify for 
a disproportionate share adjustment as 
defined under § 412.106(c)(2) if the 
hospital has 100 or more beds, is located 
in an urban area, and receives more 
than 30 percent of net inpatient revenues 
from State and local government sources 
for the care of indigent patients not 
eligible for Medicare or Medicaid. 


Section 6003(c)(2) of Public Law 101- 
239 added an additional qualifying 
methodology under section 
1886(d)(F)(5)(v) of the Act for certain 
rural hospitals beginning with 
discharges occurring on or after April 1, 
1990. That is, if a hospital located in a 
rural area has more than 100 beds, or is 
classified as a sole community hospital 
(SCH), and has a disproportionate 
patient percentage of at least 30 percent 
during its cost reporting period, the 
hospital will qualify for a 
disproportionate share adjustment. 

Sections 1886(d)(5)(F) (iii) and (iv) of 
the Act define the allowable 
disproportionate share adjustments that 
are added to the Federal portion of 
Medicare prospective payments for 
those hospitals described in sections 
1886(d)(5)(F) (i) and (v) of the Act that 
meet the disproportionate share 
qualifications. For discharges occurring 
prior to April 1,1990, those adjustments 
are— 

• 2.5 percent plus one-half of the 
difference between the hospital’s 
disproportionate patient percentage and 
15 percent for urban hospitals with 100 
or more beds and rural hospitals with 
500 or more beds; 

• 5 percent for urban hospitals with 
fewer than 100 beds; 

• 4 percent for rural hospitals with 
fewer than 500 beds; and 

• 25 percent for urban hospitals with 
100 or more beds receiving more than 30 
percent of net inpatient revenues from 
State and local government sources for 
the care of indigent patients. 

In addition, sections 6003(c) (2) and (3) 
of Public Law 101-239 amended section 
1886(d)(5)(F) of the Act, which concerns 
the payment methodology for 
determining disproportionate share 
payment adjustments effective with 
discharges occurring on or after April 1, 
1990. These changes provided for the 
following: 

• The disproportionate share payment 
adjustment factor was increased from 25 
to 30 percent for a hospital that qualifies 
for a disproportionate share adjustment 
under § 412.108(c)(2), that is, the hospital 
has 100 or more beds, is located in an 
urban area, and receives more than 30 
percent of net inpatient revenues from 
State and local government sources for 
the care of indigent patients not eligible 
for Medicare or Medicaid. 

• A hospital located in an urban area 
and having 100 or more beds, or a 
hospital located in a rural area and 
having 500 or more beds, with a 
disproportionate patient percentage of 
greater than 20.2 percent receives a 
disproportionate share adjustment that 
will increase the DRG revenue by 5.62 








Federal Register / Vol. 55, No. 171 / Tuesday. September 4, 1990 / Rules and Regulations J)5993 


percent plus 65 percent of the difference 
between its disproportionate patient 
percentage and 20.2 percent. If the 
hospital’s disproportionate patient 
percentage is less than 20.2 percent, the 
hospital’s DRG revenue is increased by 
2.5 percent plus 60 percent of the 
difference between its disproportionate 
patient percentage and 15 percent. 

• A hospital located in a rural area 
that is classified as both a rural referral 
center and an SCH receives a 
disproportionate share adjustment that 
increases the Federal portion of the 
hospital’s DRG revenue by the greater of 
10 percent, or 4 percent plus 60 percent 
of the difference between the hospital’s 
disproportionate patient percentage and 
30 percent. 

• A hospital located in a rural area 
and classified as a rural referral center 
receives a disproportionate share 
adjustment that increases the hospital’s 
DRG revenue by 4 percent plus 60 
percent of the difference between its 
disproportionate patient percentage and 
30 percent. 

• A hospital located in a rural area 
and classified as an SCH receives a 
disproportionate share adjustment that 
increases the Federal portion of the 
hospital’s DRG revenue by 10 percent. 

For a hospital with fewer than 100 
beds located in an urban area, the 
disproportionate share adjustment 
continues to be 5 percent. For a hospital 
with fewer than 500 beds located in a 
rural area, which is not classified as a 
rural referral center or an SCH, the 
disproportionate share adjustment 
continues to be 4 percent. 

Comment: One commenter stated that 
Congressional intent was not adhered to 
concerning the disproportionate share 
adjustment for hospitals that are 
designated either as SCHs or as SCHs 
and rural referral centers. The April 20. 
1990 final rule with comment stated that 
the corresponding disproportionate 
share payment percentage would be 
applied to “the Federal portion of the 
hospital’s DRG revenue.” This 
commenter asserted that the statutory 
language does not restrict the applicable 
payment to the Federal portion of the 
DRG payment and that it should also 
apply to the hospital-specific portion of 
an SCH’s payment rate. 

Response: We do not agree with the 
commenter’s interpretation of the 
statute. Section 1886(d)(5)(F)(ii) of the 
Act provides that the amount of any 
additional payment is determined by 
multiplying the total amount payable 
based on the Federal rate provided for 
in section 1886(d)(l)(A)(iii) of the Act by 
the disproportionate share adjustment 
percentage. There is no provision for 


paying the disproportionate share 
adjustment on the hospital-specific rate. 

For cost reporting periods beginning 
before April 1,1990. SCHs are paid a 
blended rate based on 75 percent of the 
hospital-specific rate and 25 percent of 
the Federal regional rate. For cost 
reporting periods beginning on or after 
April 1,1990, as provided in section 
1886(d)(5)(D)(i) of the Act, an SCH is 
paid based on whichever of the 
following three rates yields the greatest 
aggregate payment for the cost reporting 
period: 

• The Federal national rate applicable 
to the hospital. 

• The updated hospital-specific rate 
based on FY 1982 cost per discharge. 

• The updated hospital-specific rate 
based on FY 1987 cost per discharge. 

The disproportionate share 
adjustment only applies to the Federal 
rate because it is recognized that a 
federally-based payment may not take 
the additional costs associated with 
treating a disproportionate share of low 
income patients into consideration, 
since it is based on a national 
standardized amount. On the other 
hand, a hospital’s hospital-specific rate 
(HSR) is based on the historical costs of 
the individual hospital and, therefore, 
already reflects the additional costs 
incurred by the hospital for treating a 
disproportionate share of low income 
patients. Accordingly, it is appropriate 
that the disproportionate share 
adjustment be applied only to the 
Federal portion of the hospital’s DRG 
revenue. Therefore. SCHs that are still 
receiving payment based on the blended 
rate will receive a disproportionate 
share adjustment only on the 25 percent 
Federal portion. If an SCH is receiving 
payment based on the revised payment 
methodology, the disproportionate share 
adjustment will be applied only to the 
Federal national rate in determining 
which of the three rates yields the 
highest aggregate payment amount. 

Comment: We received one comment 
from a fiscal intermediary concerning 
the impact that the revised 
disproportionate share payment formula 
would have on some hospitals. The 
intermediary noted that five of the 
hospitals it services would receive 
disproportionate share payments of 
between 50 and 63 percent of its DRB- 
based payments. 

This commenter felt that HCFA 
should explain the rationale for such 
high disproportionate share adjustments 
since it appears that qualifying criteria 
and payment adjustments under this 
provision were arrived at in an arbitrary 
fashion. 

Response: Under section 9105(a) of 
the Consolidated Omnibus Budget 


Reconciliation Act of 1985 (Pub. L. 99- 
272). Congress added an explicit 
adjustment for hospitals with a 
disproportionate share of low-income 
patients, effective for discharges on or 
after May 1,1986. The qualifying criteria 
were also delineated by Congress. This 
provision was based, in part, on the 
analyses conducted by the 
Congressional Budget Office (CBO) that 
indicated that urban hospitals with 100 
or more beds and disproportionate 
patient share percentages of 15 percent 
or higher incurred higher Medicare costs 
per case than other hospitals. CBO did 
not, however, find evidence to support a 
disproportionate share adjustment for 
urban hospitals with fewer than 100 
beds or for rural hospitals. Nevertheless, 
Congress did provide an adjustment for 
those groups of hospitals using 
significantly higher qualifying criteria 
than for urban hospitals with 100 beds 
or more. In addition, section 6003(c)(2) 
of Pub. L. 101-239 expanded the 
qualifying criteria and increased the 
payment adjustments for some aspects 
of the disproportionate share adjustment 
effective with discharges occurring on or 
after April 1,1990. 

Comment: One commenter stated that 
the disproportionate share adjustment 
under Medicare should be expanded to 
include qualifying methodologies for 
psychiatric hospitals, which are 
excluded from the prospective payment 
system. 

Response: Section 1886(d)(5)(F) of the 
Act explicitly provides for the 
disproportionate share adjustment to 
payments made to hospitals under the 
prospective payment system. There is no 
provision for a disproportionate share 
adjustment to payments made to 
hospitals that are excluded from the 
prospective payment system nor do we 
believe that such an adjustment would 
be appropriate. Subject to the rate of 
increase limit, hospitals that are 
excluded from the prospective payment 
system are paid for the reasonable costs 
that they incur in furnishing services to 
Medicare beneficiaries. To the extent 
that they incur generally higher costs for 
treating a disproportionate share of low 
income patients, these higher costs are 
reflected in the reasonable cost 
determination. An explicit 
disproportionate share adjustment 
would result in program payments in 
excess of the reasonable costs incurred 
for Medicare beneficiaries. We believe 
that this would violate the basic 
principle set forth in section 
1861(v)(l)(A) of the Act that the costs of 
non-Medicare patients should not be 
borne by the Medicare program. 






35994^^Federal^egister^/ Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


Comment: One commenter believes 
that the disproportionate share 
adjustment calculation should be 
expanded to include days that Medicare 
patients utilize health maintenance 
organizations (HMOs) since these 
beneficiaries are entitled to Part A 
benefits. 

Response: Based on the language of 
section 1686(d)(5)(F)(vi) of the Act, 
which states that the disproportionate 
share adjustment computation should 
include "patients who were entitled to 
benefits under Part A", we believe it is 
appropriate to include the days 
associated with Medicare patients who 
receive care at a qualified HMO. Prior to 
December 1,1987, we were not able to 
isolate the days of care associated with 
Medicare patients in HMOs and, 
therefore, were unable to fold this 
number into the calculation. However, 
as of December 1,1987, a field was 
included on the Medicare Provider 
Analysis and Review (MEDPAR) file 
that allows us to isolate those HMO 
days that are associated with Medicare 
patients. Therefore, since that time, we 
have been including HMO days in SSI/ 
Medicare percentage. 

B. Payments to Sole Community 
Hospitals and Medicare-Dependent, 
Small Rural Hospitals (§§412.92 and 
412.108) 

Under the prospective payment 
system, special payment protections are 
provided to SCHs. An SCH is a hospital 
that, by reason of factors such as 
isolated location, weather conditions, 
travel conditions, or absence of other 
hospitals, is the sole source of inpatient 
hospital services reasonably available 
to Medicare beneficiaries. The 
regulations that set forth the criteria that 
a hospital must meet to be classified as 
an SCH and the special payment 
adjustments available to those hospitals 
are at 5 412.92. 

Prior to enactment of Public Law 101- 
239. section 1886(d)(5)(C)(ii) of the Act 
provided that SCHs be paid a blended 
rate based on 75 percent of the hospital- 
specific rate and 25 percent of the 
Federal regional rate. In addition, for 
cost reporting periods beginning before 
October 1,1990, an SCH is eligible for a 
payment adjustment if, for reasons 
beyond its control, it experiences a 
decline in volume of greater than 5 
percent compared to its preceding cost 
reporting period. (This adjustment is 
also available to a hoBpita! that could 
qualify as an SCH but chooses not to be 
paid as an SCH.) 

Section 6003(e) (1) and (2) of Public 
Law 101-239, which amended section 
1886(d)(5) of the Act, revised both the 
qualifying criteria and payment 


methodology for SCHs. However, 
section 6003(e)(3) of Public Law 101-239 
specifically states that any hospital 
classified as an SCH on December 19, 

1989 will continue to be so classified 
regardless of whether it meets the 
revised criteria resulting from changes 
made in implementing section 6003(e)(1) 
of Public Law 101-239. 

Section 1886(d)(5)(D)(iii)(I) of the Act 
incorporates the mileage standard that 
was established by regulation effective 
October 1,1989 (54 FR 36480; September 
1,1989). Thus, Congress has ratified our 
policy that a hospital can qualify for 
SCH status if it is more than 35 road 
miles from another hospital. Since this 
policy had already been incorporated 
into the regulations at 5412.92(a)(1), we 
made no further change in the April 20, 

1990 final rule with comment. 

Section 6003(e) of Public Law 101-239 

also revised the payment methodology 
for hospitals classified as SCHs 
effective with cost reporting periods 
beginning on or after April 1,1990. As of 
that date, as provided in section 
1886(d)(5)(D)(i) of the Act. SCHs will be 
paid based on whichever of the 
following rates yields the greatest 
aggregate payment for the cost reporting 
period: the Federal national rate 
applicable to the hospital, the updated 
hospital-specific rate based on FY 1982 
cost per discharge, or the updated 
hospital-specific rate based on FY 1987 
cost per discharge. 

In the April 20,1990 final rule with 
comment, we stated that the SCHs 
fiscal intermediary will determine for 
each cost reporting period which of the 
payment options will yield the highest 
payment rate. Payments will 
automatically be made at the highest 
rate based on the best data available at 
the time of the intermediary’s 
determination. However, it may not be 
possible for the fiscal intermediary to 
determine in advance precisely which of 
the rates will yield the highest aggregate 
payment for the year. This is because, in 
many instances, the hospital’s FY 1987 
cost report had not yet been audited 
and, in all instances, it was not possible 
to forecast the October 1,1990 update 
factor for the Federal rates, outlier 
payments, the amount of the 
disproportionate share adjustment, or 
the indirect medical education 
adjustment, all of which are applicable 
only to payment based on the Federal 
rate. Therefore, the intermediary will 
make its determination based on what 
appears to yield the highest payment 
amount. 

We provided that a final adjustment 
be made at the close of the hospital’s 
cost reporting period to determine 
precisely which of the three payment 


rates yielded the highest payment to the 
hospital. The settlement will take into 
account all of the adjustments described 
above. If a hospital disagrees with the 
intermediary’s determination regarding 
the final amount of program payment to 
which it is entitled under this provision, 
it has the right to appeal the 
intermediary's decision in accordance 
with the criteria in subpart R of part 405 
of the regulations, which concern 
provider payment determinations and 
appeals. 

The April 20,1990 document 
described the methodology we will use 
to calculate the hospital-specific rate 
based on an FY 1987 cost reporting 
period. We stated that FY 1987 cost 
reporting periods are those 12-month or 
longer cost reporting periods ending on 
or after September 30,1987 and before 
September 30,1988. If the hospital's last 
cost reporting period ending before 
September 30,1988 is for a period of less 
than 12 months, we use the hospital's 
most recent 12-month or longer cost 
reporting period ending before the short 
period report. 

The final rule with comment provided 
that if a hospital has no cost reporting 
period beginning in FY 1987, it will not 
have a hospital-specific rate based on 
FY 1987. The hospital will not be 
allowed to substitute any other base 
period for the FY 1987 base period. 

We stated that for each SCH, the 
intermediary will calculate an FY 1987 
hospital-specific rate as follows: 

• Determine the hospital's total 
allowable Medicare inpatient operating 
cost, as stated on the FY 1987 cost 
report. 

• Divide the total Medicare inpatient 
operating cost by the number of 
Medicare discharges in the cost 
reporting period to determine the FY 
1987 base-period cost per case. 

• Divide the base-period cost per case 
by the hospital's case-mix index 
applicable to the FY 1987 cost reporting 
period. 

Each SCH will be informed of its FY 
1987 hospital-specific rate within 180 
days of the start of its cost reporting 
period beginning on or after April 1,1990 
(the first cost reporting period to which 
the new payment methodology applies). 
We also provided that, based on the 
decision of the U.S. Court of Appeals for 
the District of Columbia circuit in 
Georgetown University Hospital v. 
Bowen, 862 F. 2d 323 (D.C. Cir., 1988), 
any adjustments made to a hospital’s FY 
1987 hospital-specific rate due to a 
favorable appeal would be made 
retroactively to the time of the 
intermediary’s initial determination. We 
added a new § 412.75 to describe 







Federal Register / Vol. 55. No. 171 / Tuesday. September 4, 1990 / Rules and Regulations 35995 


calculating the hospital-specific rate 
based on a FY 1987 base period. 

In addition to the changes described 
above, a new section 1886(d)(5)(D) of the 
Act deleted the sunset date on the 5 
percent volume decline adjustment, thus 
allowing SCHs to receive the adjustment 
indefinitely. We amended § 412.92(e) 
and (f) to reflect this change. 

Section 6003(f) of Public Law 101-239, 
which added a new section 
1886(d)(5)(G) of the Act, created a new 
category of hospitals eligible for a 
special payment adjustment under the 
prospective payment system. The 
adjustment is limited to Medicare- 
dependent, small rural hospitals (MDHs) 
and is effective for cost reporting 
periods beginning on or after April 1 , 

1990 and ending on or before March 31, 
1993. Section 1886(d)(5)(G)(iii) of the Act 
defines an MDH as any hospital that 
meets all of the following criteria: 

• The hospital is located in a rural 
area. 

• The hospital has 100 or fewer beds. 

• The hospital is not classified as an 
SCH (as defined at § 412.92) at the same 
time that it is receiving payment under 
this provision. 

• In the hospital’s cost reporting 
period that began during FY 1987, not 
less than 60 percent of its inpatient days 
or discharges were attributable to 
inpatients entitled to Medicare Part A 
benefits. 

For purposes of determining a 
hospital’s bed size, we are using the 
same definition that is currently used for 
determining number of beds to calculate 
the indirect medical education 
adjustment, the disproportionate share 
adjustment, and to detemine rural 
referral center eligibility. This definition, 
which is set forth at 5412.118(b), states 
that the number of beds in a hospital is 
determined by counting the number of 
available bed days during the hospital's 
cost reporting period, not including beds 
assigned to newborns, custodial care, 
and excluded distinct part units, and 
dividing that number by the number of 
days in the cost reporting period. 

For determining whether at least 60 
percent of the hospital’s inpatient days 
or discharges were attributable to 
Medicare Part A beneficiaries, we 
provided that days and discharges are 
counted from the hospital’s 12 -month or 
longer cost reporting period that ended 
on or after September 30,1987 and 
before September 30,1988. Only days 
and discharges from acute care inpatient 
hospital stays in the area of the hospital 
subject to the prospective payment 
system are included. 

If the hospital’s last cost reporting 
period ending before September 30,1988 
is for a period that is less than 12 


months, we provided that days and 
discharges are to be counted for the 
hospital’s most recent 12 -month or 
longer cost reporting period ending 
before the short period report. We also 
provided that days and discharges from 
swing beds are counted if the discharges 
were for acute care inpatient hospital 
stays. The Medicare count of days and 
discharges include only those days and 
inpatient stays for which benefits were 
payable under part A. 

To not disadvantage hospitals that 
receive payment from a health 
maintenance organization (HMO) or a 
competitive medical plan (CMP) for 
inpatient care provided to Medicare part 
A beneficiaries enrolled with the HMO 
or CMP, we provided that the days and 
discharges for those stays are counted. 
These days and discharges do not 
appear on the hospital’s cost report as 
Medicare days and discharges. Thus, the 
hospital should notify its intermediary 
and provide documentary evidence to 
support the number of days and 
discharges attributable to Medicare 
HMO or CMP enrollees that should be 
included in the intermediary’s 
determination of the hospital’s Medicare 
utilization. 

As set forth in section 1886(d)(5)(G)(i) 
of the Act, hospitals meeting the above 
criteria are paid using the same 
methodology applicable to SCHs, that is, 
based on whichever of the following 
rates yields the greatest aggregate 
payment for the cost reporting period: 

• The national Federal rate applicable 
to the hospital; 

• The updated hospital-specific rate 
using FY 1982 cost per discharge; or 

• The updated hospital-specific rate 
using FY 1987 cost per discharge. 

We explained that hospitals do not 
need to take any action to qualify for 
this adjustment because the fiscal 
intermediary will determine for each 
cost reporting period which hospitals 
meet the criteria to qualify as MDHs 
prior to the start of the hospital’s first 
cost reporting period beginning on or 
after April 1,1990. In addition, the 
intermediary determines for each cost 
reporting period which of the payment 
options yields the highest rate of 
payment to a hospital that qualifies as 
an MDH in the same manner as 
described above for SCHS. 

At the time the year-end settlement is 
made for purposes of determining which 
of the three payment rates yielded the 
highest payment to the hospital, an 
MDH’s cost report is also reviewed to 
ensure that it meets all the qualifying 
criteria, that is, that it is located in a 
rural area, that its bed count for the cost 
reporting period was 100 or fewer beds, 
and that it did not qualify as an SCH at 


the same time that it was receiving 
payments as an MDH. 

For purposes of counting beds, the 
most recently submitted C09t report is 
used by the fiscal intermediary to 
determine whether a hospital meets this 
criterion provisionally. A final 
determination i9 made each year based 
on its average number of beds during 
the cost reporting period. If a hospital’s 
number of beds has changed since its 
most recent cost report was submitted 
and it believes it meets the criteria to 
qualify for this adjustment, the hospital 
must notify its intermediary and submit 
documentary evidence that its bed count 
is not above 100 beds. 

As discussed above, we provided that 
the intermediary uses the hospital’s FY 
1987 cost report to determine if it meets 
the 60 percent Medicare dependency 
requirement on the basis of either days 
or discharges. If a hospital believes that 
the data in its cost report does not 
accurately reflect its Medicare 
utilization, it must notify its 
intermediary and submit verifiable 
documentation to prove that it meets the 
60 percent Medicare-patient utilization 
requirement. 

Whether the intermediary determines 
a hospital’s classification as an MDH 
based on its own data or after a 
hospital’s request, the classification is 
effective with the start of the cost 
reporting period in which the hospital 
first meets all the qualifying criteria 
effective with the first cost reporting 
period that begins on or after April 1, 
1990. 

Each MDH will be informed of its FY 
1987-based hospital-specific rate within 
180 days after it qualifies as an MDH. 
That is, any hospital that the 
intermediary identifies as qualifying for 
MDH status will be notified of its 
hospital-specific rate within 180 days 
after the start of its cost reporting period 
beginning on or after April 1,1990. 
However, any hospital that is identified 
as an MDH by the intermediary after the 
start of its cost reporting period will be 
notified of its hospital-specific rate 
within 180 days after the intermediary 
determines that it meets the qualifying 
criteria. 

Since we implemented the provisions 
of sections 1886(d)(5) (D) and (G) 
concerning the special payment 
provisions for SCHs and MDHs, we 
have discovered a special circumstance 
that should be taken into account in 
calculating the FY 1987 hospital-specific 
rate for these hospitals. Effective with 
cost reporting periods beginning on or 
after October 1 , 1987, distinct part 
alcohol/drug units were no longer 
excluded from the prospective payment 









35996__£gderal^Refflster / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


system. Therefore, the costs associated 
with such a unit would not be included 
in an SCH's or MDH's inpatient 
operating costs for its FY 1987 cost 
reporting period, but would be included 
in those costs for all succeeding cost 
reporting periods. 

So that an SCH or MDH that had an 
excluded alcohol/drug unit during its FY 
1987 cost reporting period will not be 
disadvantaged, we will allow such a 
hospital to receive an adjustment to its 
FY 1987 hospital-specific rate to account 
for the operating costs associated with 
that distinct part unit when it was made 
subject to the prospective payment 
system as part of the SCH or MDH. 
Hospitals that believe they should 
receive this adjustment should contact 
their fiscal intermediary. 

Comment: We received many 
comments regarding how swing bed 
days should be counted in determining 
whether a hospital was at least 60 
percent Medicare-dependent during its 
cost reporting period that began during 
FY 1987. Several commenters noted that 
although the preamble to the April 20. 
1990 final rule with comment period 
stated that days and discharges from 
swing beds will be counted if the 
discharges were for acute care inpatient 
hospital stays, the regulations text at 
§ 412.108(a)(2) stated that for purpose of 
determining a hospital’s status, “only 
days and discharges from acute care 
impatient stays are counted, including 
days and discharges from swing beds.” 
Some commenters concluded that the 
language of the regulation implied that 
days and discharge from a skilled 
nursing facility (SNF) level of care could 
be counted in determining Medicare 
dependency. 

Response: The word “hospital” was 
inadvertently omitted in preparing the 
regulations text. Under Medicare, there 
are two types of covered care that can 
be provided in a swing bed: acute 
inpatient hospital care and SNF care. 
Only days and discharges for acute 
inpatient hospital care are to be counted 
in determining whether a hospital was 
at least 60 percent Medicare-dependent 
during its cost reporting period 
beginning during FY 1987. SNF days and 
discharges are not to be included in the 
count. The MDH provision applies to 
hospital services only and we do not 
believe it would be equitable to include 
other than acute inpatient hospital 
services in determining whether a 
hospital qualifies for the provision. We 
have revised § 412.108(a)(2) to clarify 
our policy. 

Comment: Several commenters asked 
whether days and discharges for 
Medicare beneficiaries could be 
included in determining Medicare- 


dependency where the care would have 
been covered by Medicare, except that 
Medicare was the secondary payor and 
the primary payor paid for the entire 
stay. We were asked specifically about 
how to treat veterans benefits and 
automobile accident policy payments. In 
addition, we were asked if part A 
benefits had been exhausted, could part 
B-only stays be counted, and whether 
patient transfers could be counted 8s 
discharges. 

Response: Section 

1886(d)(5)(G)(iii)(IV) of the Act states 
that Medicare-dependency is measured 
by whether "not less than 60 percent of 
its inpatient days or discharges during 
the cost reporting period beginning in 
fiscal year 1987 were attributable to 
inpatients entitled to benefits under part 
A.” The scope of benefits to which an 
individual is entitled to payment under 
part A set forth in section 1812 of the 
Act with respect to inpatient hospital 
services, are limited to 90 days during 
each benefit period. An additional 
lifetime reserve of 60 days may be 
drawn upon when an individual exceeds 
90 days in a benefit period. Entitlement 
to payment under part A ceases after 
the beneficiary has used 90 days in a 
benefit period and has either exhausted 
the lifetime reserve days or elected not 
to use available lifetime reserve days. 

The secondary payment provisions 
under section 1862(b) of the Act do not 
affect an individual's entitlement to part 
A benefits but rather the amount of 
payment that will be made by Medicare 
for services furnished to a beneficiary. 
The Medicare payment amount can 
range all the way from zero up to the full 
DRG amount, depending upon the 
primary payer’s payment. However, 
while Medicare's payment (and the days 
of utilization counted for benefit period 
purposes) may be proportionately less 
than they would be if Medicare were the 
primary payer, the beneficiary is still 
entitled to Medicare benefits, and the 
services furnished to him or her, which 
are covered under section 1812 of the 
Act. Therefore, we believe the days and 
discharges from such a stay should be 
included in determining a hospital’s 
Medicare dependency for 1987. 

We do not believe days and 
discharges for part B—only stays should 
be counted. Again, for the MDH 
provision, section 1886(d)(5)(G)(iii)(IV) 
of the Act states that Medicare 
dependency is limited to consideration 
of those inpatients entitled to part A 
benefits. Since patients who have 
exhausted their part A benefits are no 
longer entitled to payment under part A, 
we do not believe such stays should be 
counted. Of course, if the patient was a 
hospital inpatient at a prospective 


payment hospital at the time part A 
benefits were exhausted, that stay is 
covered and will count as one discharge. 
If the benefits are exhausted prior to the 
stay going into outlier status, all the 
days of the stay are covered and 
counted. If the benefits are exhausted 
during the outlier portion of the stay, 
only those days prior to exhaustion of 
the part A benefit are counted. 

Under § 412.4, a transfer to another 
acute care hospital is not considered a 
discharge for DRG payment purposes. 
However, for other purposes, a 
discharge is defined as the formal 
release of a patient, including death, but 
excluding newborns and patients who 
are dead on arrival. For purposes of 
determining whether a hospital was at 
least 60 percent Medicare-dependent, 
we believe a patient transfer should be 
counted as a discharge regardless of 
whether the patient was transferred to 
another acute care hospital, to an area 
of the hospital not covered under the 
prospective payment system, or to a less 
intense level of care. The days for the 
acute care inpatient hospital portion of 
the stay should also, of course, be 
counted in calculating a hospital's 
Medicare-dependency based on days. 
The definition of discharges for 
purposes of the 60-percent Medicare- 
dependency test is consistent with our 
definition of discharges for cost 
reporting purposes and for purposes of 
determining the hospital-specific rate. 

We note that the April 20,1990 final rule 
with comment period did not explicitly 
discuss how transfers will be counted in 
determining the FY 1987 base period 
cost per discharge. As was the case with 
the determination of the FY 1982 base 
period cost per discharge, all transfers 
will count as discharges in calculating 
the hospital's FY 1987 Medicare 
allowable cost per discharge. We are 
clarifying $ 412.75(b) to indicate that a 
transfer will count as a discharge in 
calculating the hospital's base period 
cost per dischaxge. A similar change has 
been made in ( 412.108(a)(2) for 
purposes of determining whether the 
hospital meets the 60-percent Medicare 
dependency test. 

Comment: One commenter suggested 
that a fiscal intermediary can more 
easily identify HMO and CMP enrollees 
than can a hospital and the commenter 
recommended that for purposes of 
identifying days and discharges for 
these beneficiaries for MDH purposes, 
the intermediary should be responsible 
for automatically including days and 
discharges in its calculations. 

Response: We do not agree that 
identification of HMO and CMP 
enrollees should be the responsibility of 









Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Rules and Regulations 35997 


the fiscal intermediary. Prior to 
December 1,1967, hospitals were not 
required to submit bills for inpatient 
services furnished to Medicare 
beneficiaries who were enrolled in an 
HMO; therefore, no data are available 
on the days and discharges attributable 
to such beneficiaries for portions of FY 
1987 cost reporting periods occurring 
before December 1,1987. Although 
hospitals have submitted no-pay bills 
for Medicare beneficiaries who are 
HMO enrollees since December 1,1987, 
information on these beneficiaries is not 
retained separately in intermediary 
records from other no-pay bills. The 
intermediary would need the 
beneficiary’s health insurance claim 
number in order to be able to identify an 
HMO enrollee. Consequently, the 
hospital is generally in a better position 
to identify HMO and CMP enrollees 
than the intermediary. However, if a 
particular hospital is experiencing 
difficulty in identifying the appropriate 
cases and believes the identification of 
such enrollees would have an effect on 
its MDH status, it may contact its 
intermediary to determine if the 
intermediary can provide assistance to 
the hospital. 

Comment' Section 

1886(d) (5)(G)(iii) (IV) of the Act defined 
an MDH as a hospital that among other 
criteria was at least 60 percent 
Medicare-dependent, by days or 
discharges, “* * * during the cost 
reporting period beginning in fiscal year 
1987 • * (Emphasis added.) The 
regulation at $ 412.108{a)(iii) stated that 
the 60 percent Medicare-dependency 
must have been for the “* * * hospital’s 
12 month or longer cost reporting period 
ending on or after September 30,1987 
and before September 30,1988 # A 
commenter asked whether a hospital 
that had a shorter or a longer cost 
reporting period that began during FY 
1987 but that did not end after 
September 30,1987 and before 
September 30,1988 could be considered 
eligible for the MDH provision. The 
commenter also asked whether the same 
shorter or longer period cost report 
could be used to calculate the FY 1987 
hospital-specific amount. 

Response: We recognize that the 
definition given in the regulation could 
cause some difficulty for hospitals that 
may have changed the end of their fiscal 
year or may have closed and reopened 
during the period in question. For this 
reason, we are expanding our definition 
somewhat. If a hospital does not have a 
12 -month cost reporting period ending 
on or after September 30,1987 and 
before September 30,1988, then the 
fiscal intermediary should determine if 


the hospital had a cost reporting period 
that began during FY 1987. This revision 
in the definition may permit a hospital 
to qualify for MDH status that would 
have been denied under our prior 
definition. 

If the cost reporting period beginning 
in FY 1987 is for less than 12 months, the 
intermediary must “back up*’ to the most 
recent 12-month period ending prior to 
the short cost reporting period to 
determine both Medicare-dependency 
and the base period for calculating the 
hospital specific amount If the cost 
reporting period beginning in FY 1987 is 
for more than 12 months, this period 
should be used to determine whether the 
hospital meets the Medicare- 
dependency criterion and in calculating 
the highest of the three possible 
payment amounts. This policy will also 
be applied to calculating the FY 1987 
hospital-specific rate for an SCH. 

Comment One commenter suggested 
that we revise § 412.75(f) to clarify the 
appeals process for determinations of 
the hospital-specific rate based on the 
FY 1987 base period. The commenter 
also took issue with the provision that a 
hospital’s FY 1987 hospital-specific rate 
would be modified if certain revisions 
were made to the hospital's “base- 
period notice of amount of program 
reimbursement (NPR).” The commenter 
believes that the reference to the NPR is 
inappropriate since, for FY 1987, SCHs 
and MDHs were not paid for inpatient 
operating costs on a reasonable cost 
basis and their base-period costs will 
not be based on an NPR determination. 

Response: We agree that the process 
for appealing intermediary 
determinations of the hospital-specific 
rate needs to be clarified, and we are 
amending the regulations to provide 
specific authorization for such appeals 
in S 412.75. This regulation now provides 
that a determination of a hospital's 
hospital-specific rate will be treated as a 
final intermediary determination of the 
amount of program reimbursement for 
purposes of the administrative and 
judicial review provisions set forth in 
subpart R of part 405. 

We disagree, however, that the 
regulations need not also take into 
account changes to the base-period 
notice of amount of program 
reimbursement that result from 
administrative and judicial review. The 
commenter correcdy noted that the FY 
1987 notice of amount of program 
reimbursement for SCHs and MDHs did 
not determine allowable inpatient 
operating costs on a reasonable cost 
basis. However, this does not mean that 
revisions to or appeals of the base- 
period notice of program reimbursement 


will have no impact on the 
determination of base-period inpatient 
operating costs. For example, the 
determination of base-period inpatient 
operating costs could be affected by the 
same circumstances that cause a 
revision in the intermediary’s 
determination of allowable outpatient 
costs. For this reason, we are providing 
in i 412.75(g) that a hospital's hospital- 
specific rate for FY 1987 will be revised 
to reflect not only any modifications 
resulting from administrative and 
judicial review of the hospital-specific 
rate determination, but also increases or 
decreases in costs recognized as 
allowable for the hospital's base period 
as a result of administrative or judicial 
review of the base-period notice of 
amount of program reimbursement. 

Comment: One commenter requested 
certain protections to avoid the 
possibility of error in a fiscal 
intermediary's initial determination of 
which of the three payment rates yields 
the highest aggregate payment for an 
SCH or MDH. The commenter was 
concerned that if an intermediary used 
an inappropriate estimating method or 
made a calculation error in determining 
the most advantageous rate, the hospital 
would have to wait a substantial period 
of time, and perhaps incur serious cash 
flow problems, before any final 
settlement or reevaluation of the 
aggregate rate determinations would be 
made. Accordingly, the commenter 
suggested the fiscal intermediaries be 
required to furnish each SCH and MDH 
a copy of the calculations used to make 
the initial determination of the highest 
aggregate payment amount, as well as a 
copy of the calculations used to 
determine the final payment amount. 
The commenter also suggested that the 
intermediary be required to take into 
account any additional information the 
hospital may provide and to consider an 
interim adjustment prior to the end of 
the cost reporting period if additional 
data result in more favorable payment 
for the hospital. 

Response: We believe current 
program practices already meet the 
commenter’s concern. For interim 
payment purposes, it is not necessary to 
estimate aggregate payments over the 
cost reporting period. Payments will 
continue to be made on an individual 
bill basis; therefore, it is necessary only 
to determine which of the three rates 
(that is. the 1982 hospital-specific rate, 
the 1987 hospital-specific rate, or the 
Federal rate) is likely to result in the 
highest payment This determination is 
made by the PRICER program used to 
pay Medicare bills. All bills will be 
priced based on the Federal rate. In 








35998 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


addition, if PRICER determines that the 
hospital-specific rate would yield, on 
average, a higher payment, an add-on 
payment will be made for each 
discharge based on the estimated 
difference between the higher hospital- 
specific rate and the average Federal 
payment for that DRG. 

Determining which of the two 
hospital-specific rates yields the higher 
aggregate payment amount is fairly 
straightforward. If a hospital is 
dissatisfied with the intermediary’s 
determination of the FY 1987 hospital- 
specific rate, it may appeal that 
determination upon receipt of the notice 
of the rate, as discussed in the response 
to the immediately preceding comment. 

The more difficult comparison is 
between the higher hospital-specific rate 
and the Federal rate. The difficulty is 
that aggregate Federal payments are 
affected by a number of factors that 
cannot be determined precisely in 
advance, such as the amount of outlier 
payments, the disproportionate share 
adjustment, and the indirect medical 
education adjustment. However, as 
explained in the April 20,1990 final rule 
with comment period, interim payment 
will automatically be made at the 
highest rate using the best data 
available. As with all interim payments, 
the hospital will be permitted to submit 
any additional data that it believes 
might affect the estimate of its Federal 
rate. These data could include updated 
information for purposes of estimating 
the indirect teaching or disproportionate 
share factors. PRICER uses the rural 
national average outlier experience to 
estimate average outlier payments, 
which we believe is an adequate 
estimate for interim payment purposes. 
Final settlement will take into account 
actual outlier payments. 

A hospital has the necessary 
information to estimate its average 
Federal rate. The formula for doing so is 
as follows: 

1 . Multiply the labor-related portion of 
the standardized amount by the 
applicable wage index and add the 
product to the nonlabor-related portion 
of the standardized amount. 

2 . Multiply the amount determined in 
Step 1 by the sum of 1 plus the 
applicable indirect teaching adjustment 
factor and the disproportionate share 
adjustment factor. 

3. For discharges occurring on or after 
October 1,1990, multiply the amount 
determined in Step 2 by 1.02315 to 
determine the estimated average 
Federal rate including outlier payments. 
(For discharges occurring before 
October 1,1990, the factor is 1.02197). 

4. If the hospital-specific rate is higher 
than the estimated average Federal rate 


determined in Step 3. determine the 
difference. To determine the add-on for 
a specific case, multiply the difference 
by the DRG weight for the case. 

We do not believe it is necessary to 
require an intermediary to issue these 
calculations routinely to each hospital. 
Finally, if, based on the submission of 
additional information or the 
identification of a calculation error, the 
determination of the highest aggregate 
payment is determined to be incorrect, 
the intermediary should adjust 
payments as soon as possible without 
waiting until final settlement of the 
hospital’s cost report. This is consistent 
with our general policy for adjusting 
interim payments. 

C. Recognition of Nursing School Costs 
(§§ 412.113(b) and 413.85) 

1. Background 

Medicare has historically paid a share 
of the net cost of approved medical 
education activities. Regulations 
concerning Medicare payment for 
nursing and allied health educational 
costs are located at §§ 412.113(b) and 
413.85. Section 413.85(b) defines 
approved educational activities as 
formally organized or planned programs 
of study usually engaged in by providers 
in order to enhance the quality of 
patient care in an institution. Under 
§ 413.85(e), approved medical education 
activities include training programs for 
nurses. 

Section 413.85(a) specifies that the 
allowable cost of approved educational 
activities is the net cost, which is 
determined by deducting tuition 
revenues from total costs. The net costs 
incurred for classroom and clinical 
training in an approved nursing 
education program operated by the 
provider are included within the 
definition of allowable medical 
education costs. Under sections 1886 
(a)(4) and (d)(1)(A) of the Act and 
§ 412.113(b) of the regulations, the costs 
of approved medical education activities 
are excluded from the definition of 
operating costs and, in the case of 
approved nursing education programs 
operated by the provider, are paid on a 
reasonable cost basis. 

Section 413.85 excludes costs incurred 
for nonprovider-operated programs from 
the definition of the approved medical 
education activities. The costs incurred 
by a hospital to support a nonprovider- 
operated nursing education program, to 
the extent they are allowable, are 
considered normal operating costs and 
are included in the DRG payment for 
inpatient services and are paid on a 
reasonable cost basis for outpatient 
services. 


The allowable costs of nonprovider- 
operated nursing education programs 
are defined in chapter 4 of the Provider 
Reimbursement Manual (HCFA Pub. 15- 
1 ). Under our current policy, costs 
incurred by the hospital for clinical 
training at the hospital that relate to 
care of the hospital's patients are 
allowable. In cases in which classroom 
training occurs at the hospital, costs 
incurred by the hospital are allowable 
if— 

• The hospital’s support does not 
constitute a redistribution of 
nonprovider costs to the hospital; 

• The hospital is receiving a benefit 
for the support it furnishes; and 

• The hospital’s support is less than 
the cost the hospital would be expected 
to incur with a program of its own. 

2 . Section 6205 of Public Law 101-239 

Section 6205(a) of Public Law 101-239 
created a new temporary category of 
"hospital-based nursing schools" in 
addition to those recognized under 
§§ 412.113(b) and 413.85. Gosts incurred 
by hospitals for training nursing 
students enrolled in these schools are to 
be paid on the basis of reasonable cost 
as though the hospital met the criteria at 
§ 413.85. As specified in section 
6205(a)(1)(A) of Public Law 101-239, 
costs incurred by a "hospital-based 
nursing school" will qualify under this 
provision— 

.if, before June 15.1989, and 

thereafter, the hospital demonstrates that for 
each year, it incurs at least 50 percent of the 
costs of training nursing students at such 
school, the nursing school and the hospital 
share some common board members, and all 
instruction is provided at the hospital or. if in 
another building, a building on the immediate 
grounds of the hospital.” 

We provided that to meet the first 
criterion, the hospital must incur at least 
50 percent of the total costs, that is. the 
costs before deduction of tuition 
revenues, incurred for classroom and 
clinical training provided to students 
enrolled in an approved nursing 
education program at the hospital-based 
nursing school. This includes programs 
in both professional and practical 
nursing that are approved by the 
appropriate approving body under 
§ 413.85(e). We note that approved 
allied health education programs are not 
included in this provision. Moreover, we 
provided that a hospital would not be 
considered to be incurring costs through 
payments to an educational institution 
for training of students. 

Neither section 6205 of Public Law 
101-239 nor the Committee Report (H.R. 
Rep. No. 386,101st Cong., 1st Sess. 

(1989)) that accompanied Public Law 









Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Rules and Regulations 35999 


101-239 elaborates on the second 
criterion, that the nursing school and the 
hospital share some common board 
members. We provided that we consider 
this requirement to be met if at least 50 
percent of the board with fewer 
members (either the hospital or the 
nursing school) are also members of the 
board of the other entity, regardiesB of 
the number of members of the larger 
board. 

The third criterion, that all instruction 
be provided at, or on the immediate 
grounds of, the hospital is clarified in 
the Conference Committee Report (H.R. 
Rep. No. 386.101st Cong., 1st Sess. 669 
(1989)). The report states that a program 
complies with this requirement 
“• * * only if this instruction occurs on 
the hospital campus, not on the campus 
of on institution with which the hospital 
is affiliated (Emphasis added.) In 
instances where the hospital is 
contiguous to. or within, the campus of 
an educational institution, this criterion 
will be considered to be met only if the 
instruction is provided at the hospital. 

Section 6205(b)(2)(A) of Public Law 
101-239 requires that the Secretary issue 
proposed regulations before July 1,1990 
that specify— 

• The relationship required between 
an approved nursing education or allied 
health education program and a hospital 
for the program’s costs to be attributed 
to the hospital; 

• The types of costs related to nursing 
or allied health education programs; 

• The distinction between costs of 
approved educational activities paid on 
the basis of reasonable cost and 
educational costs treated as operating 
costs of inpatient hospital services; and 

• The treatment of other funding 
sources for the program. 

Section 6205(b)(2)(B) of Public Law 
101-239 provides that the final rule will 
not be effective before October 1,1990, 
or 30 days after publication of the final 
rule in the Federal Register, whichever 
is later. 

In addition, section 6205(b)(2)(A) of 
Public Law 101-239 provides that during 
the period after December 18,1989 and 
before October 1,1990, there is to be no 
recoupment of overpayments 
attributable to nursing and allied health 
costs that have been reported as 
allowable medical education costs 
payable on a reasonable cost basis and 
later have been determined to not meet 
the definition of these costs. We have 
issued program instructions to our 
intermediaries to implement this 
provision. 

Section 6205(a)(2) Public Law 101-239 
states that the new “hospital-based 
nursing school” provision applies to cost 
reporting periods beginning on and after 


enactment and # on or before the 
date on which the Secretary issues 
regulations pursuant to subsection 
(b)(2)(A) (section 6205(b)(2)(A) of Public 
Law 101-239).” In citing section 6205 
(b)(2)(A), section 6205(a)(2) of Public 
Law 101-239 presents us with a logical 
inconsistency. 

Subparagraphs (A) and (B) of section 
6205(b)(2), taken together, make it clear 
that the regulations referred to in 
section 6205(b)(2)(A) are proposed 
regulations, to be issued before July 1, 
1990, and to be followed by a BO-day 
comment period. The final regulations 
(to which, it is assumed, the term 
“regulations” in section 6205(a)(2) of 
Public Law 101-239 refers) are to be 
effective no earlier than October 1,1990. 
In light of the common understanding of 
the term “regulations'’, we provided that 
the temporary category of “hospital- 
based nursing schools” will expire with 
a hospital’s first cost reporting period 
beginning on or after the date of the 
final regulations required by section 
6205(b)(2)(B)(iii) of Public Law 101-239 
are issued. 

Given the temporary and limited 
applicability of section 6205(a) of Public 
Law 101-239, we did not amend the 
codified regulations to reflect the 
implementation of the policies explained 
above. 

3. Comments and Responses 

Two commenters are concerned with 
our interpretation of section 6205(a) of 
Public Law 101-239 concerning the 
recognition of costs of approved nursing 
education and allied health education 
programs not operated directly by a 
hospital to the extent that these policies 
will be incorporated into the regulations 
required under section 6205(b)(2)(B) of 
Public Law 101-239. As noted above, 
section 6205(b)(2)(B) of Public Law 101- 
239 requires the Secretary to publish 
final regulations to be effective no 
earlier than October 1,1990 that address 
the types of nursing and allied health 
education costs that should be 
considered allowable and which of 
these allowable costs should be treated 
as operating costs and which should be 
treated as pass-through costs and paid 
on a reasonable cost basis. 

We will be publishing the regulations 
required by section 6205(b)(2)(A) of 
Public Law 101-239 as a separate 
proposed rule with a 60-day comment 
period. The proposed rule will be 
separate from and not contingent upon 
any of the provisions in this final rule 
concerning hospital-based nursing 
schools. We have addressed the specific 
concerns of those who commented on 
section 6205(b) of Public Law 101-239 as 
well as the other comments we received 


on our implementation of the provisions 
of section 6205(a) in the April 20.1990 
final rule with comment. 

Comment: A commenter believes that 
there is no basis in section 6205(a) of 
Public Law 101-239 or its legislative 
history for a requirement that at least 50 
percent of the board with fewer 
members (either the hospital or the 
nursing school) be members of the board 
of the other entity. The commenter 
noted that the law provides that the 
hospital and nursing school share 
“some” common board members. The 
commenter cited Webster’s dictionary, 
in which “some” is defined as “being at 
least one * * which the commenter 
believes should be the minimum 
requirement for overlapping board 
membership. Another commenters 
experience is that the 50 percent 
requirement is much too onerous. The 
commenter believes that it is unrealistic 
to expect that the governing bodies of 
two large organizations will have such a 
substantial overlap. Other commenters 
suggested that at least two members or 
30 percent of the smaller board be the 
minimum requirement. 

Response: When writing a rule to 
implement a statutory provision, we first 
look to the legislative history for 
clarification of provisions in the statute. 
In this case, the Conference Committee 
Report that accompanied Public Law 
101-239 is silent on the issue of what the 
Congress meant by “some.*' The 
definition of “some" cited by one of the 
commenters is one of three definitions of 
the word “some", as an amount or 
quantity, in Webster’s dictionary. 
However, the other two definitions have 
in common a definition of "some” as an 
unspecified number or amount. We 
believe that common usage tends much 
more toward this definition, rather than 
that cited by the commenter. Therefore, 
we have not accepted the comment that 
“some" should be defined as “at least 
one". 

In the absence of any specific 
explanation of Congressional intent, we 
look to the overall language of a 
statutory provision for a common-sense 
explanation of a specific requirement. In 
this case, the other two criteria for a 
hospital-based nursing school are that 
all instruction be provided at the 
hospital and that the hospital incur at 
least 50 percent of the school’s cost. In 
using the word “some” for the board 
overlap requirement we concluded that 
the Congress intended that there be an 
appreciable overlap between board 
members. In most situations, we believe 
that our policy that at least 50 percent of 
the board with fewer members must 










36000 Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Rules and Regulations 


also be members of the other board is a 
reasonable standard. 

For example, if a nursing school has 
an 8-member board and a hospital has a 
30-member board, this criterion would 
be met if 4 members of the nursing 
school’s board were also members of 
the hospital’s board. Thus, less than 14 
percent of the larger board would 
consist of members of the smaller board. 

At the same time, we recognize that if 
both boards are large, there may be 
situations where the 50 percent standard 
would not be reasonable in determining 
whether the board membership criterion 
are met. Therefore, we are modifying 
our policy to provide that the lesser of 4 
board members or 50 percent of the 
members of the smaller board must be 
common board members. 

Comment: One commenter stated that, 
in determining whether a hospital-based 
nursing school meets the common board 
membership criterion, HCFA should 
recognize overlapping board 
membership between a nursing school 
and a corporate parent organization of 
the hospital, since this organization 
owns or controls the hospital. 

Response: We do not believe that we 
should revise the policy as proposed by 
the commenter. Section 6205(a)(1)(A) of 
Pub. L. 101-239 clearly requires that the 
hospital share some common board 
members with the nursing school. 
Moreover, our policy is consistent with 
other aspects of the Medicare program. 
For example, in determining whether a 
nursing education program is provider- 
operated, we look to whether the 
hospital actually operates the program. 

If the program is operated by a parent 
corporation rather than the hospital, we 
do not consider the program to be 
provider-operated. 

Comment: Two commenters stated 
that it is unreasonable to require that 
the hospital incur 50 percent or more of 
the total costs of the nursing program; 
that is, the costs before deduction of 
tuition revenues. The commenters also 
suggested that support payments made 
by the hospital to the nursing school 
should be recognized in applying the 50 
percent test. The commenters believe 
that the requirement that the hospital 
directly incur 50 percent of the total cost 
unnecessarily interferes with the 
administration of the nursing school by 
requiring that, for example, more faculty 
be salaried by the hospital than by the 
school, or that more of the facility costs 
be paid by the hospital than by the 
school so the costs are directly incurred 
by the hospital. Thus, this policy also 
interferes with the school’s ability to 
demonstrate that it operates as a 
separate corporation under its own 
governing authority as required by 


certain accrediting organizations. The 
commenters suggest that a payment by 
the hospital equal to at least 50 percent 
of the net cost of the program should be 
sufficient to satisfy the support 
requirement. 

Response: We agree with the 
commenter that the requirement should 
be 50 percent of the net costs rather than 
total costs and that payments to the 
nursing school should be recognized in 
applying the criterion. Program policy 
has been to recognize the net cost of 
educational activities for Medicare 
payment purposes. Net cost is defined 
as total cost less tuition revenues. 

There are probably few situations 
where the use of net cost rather than 
total costs would make any difference. 
This is because the tuition offset should 
ordinarily be proportional to the costs 
incurred by each entity. We recognize, 
however, that there may be situations in 
which a proportional offset would not 
be appropriate. For example, a nursing 
education program’s established policy 
could be that students pay tuition while 
in the classroom education portion of 
the program at a college. When the 
students move to the clinical education 
portion of the program at the hospital, 
they may pay no tuition or a reduced 
tuition amount or are paid a stipend, or 
both. In such situations, a proportional 
offset of tuition income would not be 
appropriate. 

To accommodate these situations, we 
are revising our policy to provide that 
the hospital must incur 50 percent of the 
net cost of the nursing education 
program. If the hospital supports the 
nursing education program in cash 
rather than in kind, the payments to the 
nursing school are allowable costs if the 
hospital’s support does not constitute a 
redistribution of the nonprovider's costs 
to the hospital, and the support is less 
than the provider would incur in running 
its own program. If the costs are 
allowable, they are included in the 
hospital's costs for purposes of the 50 
percent test. The hospital must furnish 
auditable documentation that the 
hospital incurs, either in cash or in kind, 
50 percent of the net cost of the nursing 
education program. A full costing 
methodology, such as that provided for 
in the latest version of A Cost 
Accounting Handbook for College and 
Universities published by the National 
Association of College and University 
Business Officers or in OMB Circular A- 
21, Cost Principles for Educational 
Institutions, should be used to determine 
the cost to the college for the nursing 
school. 

Comment: One commenter was 
concerned that a nursing school’s use of 
a building on the hospital's grounds that 


the nursing school leases from the 
hospital could lead to a determination 
that instruction is not taking place at the 
hospital because the leased building is 
not part of the licensed hospital facility. 

Response: If the leased building were 
on the hospital grounds, the requirement 
that all instruction is provided at, or on 
the immediate grounds of, the hospital 
would be met. To clarify the point for 
this commenter, if a nursing school 
leases a building on the hospital grounds 
to be used for classroom instruction of 
nursing students, we would consider the 
instruction to be taking place on the 
immediate grounds of the hospital. The 
hospital’s capital-related and operating 
costs associated with the leased 
building are reduced by the amount of 
lease income. 

In summary, for hospital cost 
reporting periods beginning on and after 
December 19,1989, a hospital may claim 
as pass-through costs the costs incurred 
in training students from a nursing 
school that meet all of the following four 
criteria: 

(i) The hospital incurs at least 50 
percent of the net costs, that is, the costs 
after a deduction of tuition revenues 
incurred for classroom and clinical 
training provided to students enrolled in 
an approved nursing education program 
at the hospital-based nursing school. 

This would include programs in both 
professional and practical nursing that 
are approved by the appropriate 
approving body under § 413.85(e). 

(ii) At least 50 percent of the board of 
directors with fewer members (either the 
hospital or the nursing school) or 4 
members, whichever results in a smaller 
number, are also members of the board 
of the other entity, regardless of the 
number of members of the larger board. 

(iii) All instruction is provided at, or 
on the immediate grounds of, the 
hospital. In instances where the hospital 
campus is contiguous to, or within, the 
campus of an educational institution, 
this criterion will be considered to be 
met only if the instruction is provided at 
the hospital. 

(iv) The preceding three criteria were 
met on June 15,1989, and have been met 
continuously since that date. 

D. Payments for Hemophilia Inpatients 
(§ 412 . 115 ) 

Hemophilia, a blood disorder 
characterized by prolonged coagulation 
time, is caused by an inherited 
deficiency of a factor in plasma 
necessary for blood to clot. Hemophilia 
is considered to encompass the 
following conditions: Factor VIII 
deficiency (classical hemophilia); Factor 
IX deficiency (also termed plasma 






Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 36001 


thromboplastin component (PTC) or 
Christmas factor deficiency); and Von 
Willebrand’s disease. The most common 
factors required by hemophiliacs to 
increase coagulation are Factor VIII and 
Factor IX; a small number of 
hemophiliacs have developed inhibitors 
to these factors and require special 
treatment. 

In late 1989, ProPAC completed a 
study entitled “The Adequacy of 
Prospective Payment for Medicare 
Beneficiaries with Hemophilia." ProPAC 
determined that hemophilia patients 
were distributed across several DRGs 
and that patients with hemophilia had 
higher inpatient operating costs than 
other patients. However, while 
payments under the prospective 
payment system for these cases were 
slightly higher, the relative payment to 
cost ratios were lower. On October 2, 
1989, ProPAC recommended to Congress 
implementation of a prospectively 
determined add-on payment for patients 
requiring the clotting factor, and that 
this payment should be determined on a 
per unit basis, based on a weighted 
average of the types of clotting factor 
available. 

In response to ProPAC's 
recommendations and growing concern 
about increasing hospital costs for 
treating hemophiliacs, Congress enacted 
section 6011 of Public Law 101-239. That 
section amended section 1886(a)(4) of 
the Act to provide that prospective 
payment hospitals receive an additional 
payment for the costs of administering 
blood clotting factor to hemophiliacs 
who are hospital inpatients. The 
payment is to be based on a 
predetermined price per unit of the 
clotting factor multiplied by the number 
of units provided. Under section 
1886(a)(4) of the Act, this add-on 
payment is effective for blood clotting 
factor furnished on or after June 19,1990 
and before December 19,1991. In 
addition, section 6011 of Public Law 
101-239. requires HCFA and ProPAC to 
develop and submit to Congress 
recommendations on how to pay for 
blood clotting factor. These 
recommendations are due not later than 
June 19,1991. 

We established a price per unit of 
clotting factor based on the latest (1990) 
price listing available from the Drug 
Topics Red Book, the publication of 
pharmaceutical average wholesale 
prices. We set three separate add-on 
amounts, one for each of the three basic 
types of clotting factor because a 
comparison of the wholesale prices for 
the different types of clotting factor (that 
is, Factor VIII, Factor IX, and the other 
factors which are given to those patients 


with inhibitors to Factors VIII and IX 
(designated as Anti-inhibitors in this 
document)) reveals great variations 
among the three types. The Factor IX 
products are priced much lower than the 
Factor VIII products, and the special 
Anti-inhibitor factors are priced higher 
than both of the other factors. Therefore, 
we determined that it is more equitable 
to set an add-on payment amount for 
each type of blood clotting factor. 

The add-on payment amount for each 
of the three types of factor was based on 
the median average wholesale price of 
the several products available in that 
category of factor. However, since we 
are aware that hospitals are generally 
able to negotiate direct selling prices 
with the various drug companies that 
are lower than the wholesale prices 
listed in the Drug Topics Red Book, we 
discounted the average wholesale prices 
by 15 percent before calculating the 
median price. This 15 percent discount 
was based on the results of a study 
conducted by the Department’s Office of 
Inspector General (OIG) entitled "Use of 
Average Wholesale Prices in 
Reimbursing Pharmacies Participating in 
Medicaid and the Medicare Prescription 
Drug Program" (Report No. A-06-89- 
00037, October 3.1989). The OIG 
determined that the average wholesale 
price of a drug is heavily discounted in 
direct sales and that current data show 
that this discount averages 15.5 percent. 
In addition, the OIG report states that 
the average wholesale price is not a 
meaningful payment level, and it should 
not be used for making payment for 
drugs under Medicare. 

Based on information from industry 
representatives, we believe that the 
doting factors are generally available to 
hospitals at or below the add-on 
payment amounts that we established 
for the three types of blood clotting 
factors, which are as follows: 

Factor VIII—$.64 per unit 

Factor IX—$.26 per unit 

Other Hemophilia Clotting Factors (for 

example, Anti-inhibitors)—$1.00 per unit 

We recognize that the products 
available, and their costs, are changing 
rapidly, with new products entering the 
market and existing products being 
discontinued. Since the market share of 
various products can shift dramatically 
within a short period of time, we believe 
the median price is preferable to a 
weighted average. In the April 20,1990 
final rule with comment, we stated that 
we recognize that changes in the clotting 
factor market may require re-evaluation 
of the add-on payment amount before 
the final rule setting forth the FY 1991 
prospective payment rates is issued. 


We have developed specific codes to 
identify the three types of factor. These 
codes must be included in the bill 
submitted by the hospital in-order to 
receive the add-on payment. 

Instructions were issued to Medicare 
intermediaries explaining the codes and 
how to use them (Transmittal No. 1486, 
August 1990). These codes serve to 
identify the causes requiring payment 
for the clotting factor and also permit 
the accumulation of data over time. The 
data will be evaluated in determining 
future payment alternatives. 

Comment: A manufacturer of blood 
clotting factors for hemophilia patients 
wrote to inform us about a newly 
developed purified Factor IX. This 
product is currently in the process of 
being approved by the Food and Drug 
Administration (FDA). The 
manufacturer recommended that 
purified Factor IX concentrates be 
classified with blood clotting factor 
products categorized as "Other" and 
reimbursed at $1.00 per unit, as this 
amount more closely approximates their 
production cost than the $.26 per unit 
allowed for other Factor IX products. 

Response: At this time, the purified 
factor IX referred to by the commenter 
is still in the process of being approved 
by the FDA. Until approval is final, the 
product will not be licensed and no 
price will be assigned to it. As noted 
above, we stated in the April 20,1990 
final rule with comment period that if 
any new products were approved before 
publication of the FY 1991 prospective 
payment system final rule we would 
recalculate the add-on payment amount 
for blood clotting factors administered 
to hemophilia patients. However, since 
the approval process for this new Factor 
IX product is still in process, no unit 
price has been assigned and we will not 
be able to include it in any category at 
this time, nor will we revise any of the 
add-on amounts. 

When this factor does receive final 
approval by the FDA. it will be assigned 
to the appropriate category for payment 
as will any other new FDA-approved 
blood clotting product. We will reassess 
the prices per unit for each of the blood 
clotting factors and any other 
appropriate issues as part of the 
proposed rule for FY 1992 prospective 
payment system changes. 

Comment: One commenter objected to 
the application of a 15 percent discount 
to the price per unit for blood clotting 
factors administered to Medicare 
hemophilia inpatients. The commenter 
stated that this Medicare reduction was 
for the purpose of taking into account 
either incentive discounts or volume 
discounts granted by manufacturers to 








36002 Federal Register / Vol. 55. No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


the hospitals. However, because of the 
small volume of blood clotting factor 
purchased by any one hospital, 
manufacturers’ incentive discounts and 
volume discounts do not apply. 
Therefore, the commenter asserts that 
hospitals cannot be expected to 
negotiate discounts for these blood 
clotting factors as they could for other 
types of drugs and that in setting the 
add-on payment amount per unit of 
blood clotting factor, the 15 percent 
discount should be eliminated. 

Response: Although the volume of 
hemophiliacs who are hospital 
inpatients is not of the magnitude of a 
variety of other hosptial inpatient 
conditions requiring pharmaceutical 
drugs, utilization of blood clotting 
factors is concentrated in certain 
hospitals. Comprehensive hemophilia 
treatment centers administer the 
majority of these factors. Since we 
believe that the intention of Congress in 
including this special blood clotting 
factor payment provision in section 6011 
of Public Law 101-239 was to protect 
from large losses those hospitals that 
specialize in treating hemophilia 
patients and purchased substantial 
amounts of clotting factor, we conclude 
that it is not inappropriate to 
incorporate a 15 percent discount in 
setting the price of clotting factor. 

We also note that, prior to deciding on 
the per unit payment to be added on for 
blood clotting factors administered to 
hemophilia inpatients, we conducted 
extensive consultation with experts in 
the field, including information on price 
availability. Based on the results of 
these consultations, we are confident 
that the payment rates established are 
adequate and equitable. 

E. Ceiling on Rate of Hospital Cost 
Increases 

Section 101 of the Tax Equity and 
Fiscal Responsibility Act of 1962 (Pub. L 
97-248) added section 1986 to the Act to 
establish a ceiling on the allowable rate 
of the increase for hospital inpatient 
operating costs. This ceiling still applies 
to hospitals and units excluded from the 
prospective payment system. Excluded 
hospital and hospital units under section 
1886(d)(1)(B) of the Act include 
psychiatric, rehabilitation, children’s, 
cancer, and long-term hospitals, and 
psychiatric and rehabilitation distinct- 
part units of acute care hospitals. (Prior 
to FY 1988, alcohol/drug hospitals and 
distinct-part units were also excluded 
from the prospective payment system, 
but are now under the prospective 
payment system.) 

These excluded hospitals and units 
receive payment for the inpatient 
nospital services they furnish on the 


basis of reasonable cost up to a ceiling. 
Under the rate of increase limits, an 
annual target amount (stated as 
inpatient operating cost per discharge) is 
set for each hospital, based on the 
hospital’s own cost experience in its 
base year. This target amount is applied 
as a ceiling on the allowable costs per 
discharge for the hospital's next cost 
reporting period. 

A hospital that has inpatient operating 
costs per discharge in excess of its 
target amount would be paid no more 
than that amount. However, a hospital 
that has inpatient operating costs less 
than its target amount would be paid its 
costs plus the lower of: 

(1) 50 percent of the difference 
between the inpatient operating cost per 
discharge and the target amount; or 

(2) 5 percent of the target amount. 

Each hospital's target amount is 

adjusted annually, before the beginning 
of its cost reporting period, by an 
applicable target rate percentage for the 
12-month period. The rate of increase 
limit is based on an assumption that a 
provider’s year-to-year inpatient 
operating costs should remain 
comparable to its base year, except for 
inflation. Section 1888(b)(4)(A) of the 
Act gives the Secretary the authority to 
grant an exemption from, or an 
adjustment or exception to, the rate of 
increase limit where events beyond the 
hospital's control ot extraordinary 
circumstances create a distortion in the 
increase in costs. 

Section 0015 of the Omnibus Budget 
Reconciliation Act of 1989 (Pub. L. 101- 
239) amended the adjustment authority 
contained in section 1986(b)(4)(A) of the 
Act to provide that a hospital or 
excluded unit may be assigned a new 
base year in lieu of adjustments to the 
existing target amount. Thus, the 
assignment of a new base period is 
another mechanism HCFA may use, 
when appropriate, in determining the 
payment amount to an excluded hospital 
that has exceeded its ceiling in a cost 
reporting period. Section 6015 of Public 
Law 101-239 requires the Secretary to 
publish instructions that set forth the 
application process under which 
hospitals may request target rate 
exemptions and adjustments. 

1. Base Period 

Section 1686(b)(3) of the Act provides 
for the use of a particular 12-month cost 
reporting period as the base period that 
serves as the basis for future periods' 
target amount after updating by the 
applicable percentage increase. The 
base period is the first cost reporting 
period of the excluded hospital or unit 
beginning before the period for which 
section 1886(b) of the Act applies. 


Section 1886(b)(5) of the Act gives the 
Secretary the authority to determine the 
applicable 12-month period to use as the 
base period for excluded hospitals or 
hospital units that have a cost reporting 
period that is other than 12 months in 
duration. This policy is set forth in 
regulations at § 413.40(b) 

A hospital’s fiscal intermediary 
calculates the target amount by dividing 
the Medicare allowable inpatient 
operating costs, as defined under section 
1886(a)(4) of the Act, by the number of 
Medicare discharges in the base year 
cost reporting period. A hospital could 
incur costs that exceed its ceiling due to 
extraordinary circumstances such as 
flood, fire, earthquake or similar unusual 
occurrences, or some other factor that 
has caused a distortion in the 
comparison of the base year and the 
applicable cost reporting period. Under 
section 1886(b)(4)(A) of the Act. the 
Secretary can provide for a exception or 
adjustment to the hospital's ceiling in 
such circumstances. Section 413.40(f) of 
the regulations implement section 
1886(b)(4) of the Act regarding 
exemptions, adjustments and exceptions 
to the target rate of increse limit. The 
regulations provide that HCFA may 
adjust a hospital's operating costs 
considered in establishing cost per case, 
including both periods subject to the 
limit and the hospital's base periods, to 
take into account— 

• Unusual costs due to extraordinary 
circumstances beyond the provider's 
control; 

• Distortions in costs caused by a 
change in case mix as a result of the 
addition or discontinuation of services; 
or 

• Factors such as a change in the 
inpatient hospital services that a 
hospital provides that could result in a 
significant distortion in the operating 
costs of inpatient hospital services. 

The adjustment may be made only if the 
hospital exceeds its limit for the cost 
reporting period and only to the extent 
the hospital’s costs are reasonable, 
attributable to circumstances specified 
above, and verified by the intermediary. 

The exceptions or adjustments we 
make to a hospital's target amount are 
most commonly for a particular problem 
in one cost reporting period, such as a 
hospital experiencing an increase in its 
Medicare average length of stay relative 
to its base year. This increase could 
cause a distortion in the comparison to 
its base year since the limit is calculated 
on a per discharge basis. If a hospital 
whose costs exceed the limit 
demonstrates that its increased costs 
are attributable to an average length of 
stay increase and that its costs are 





Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 36003 


reasonable, we adjust the limit to 
recognize the increase in average length 
of stay over the base period. 

In some situations, a permanent 
adjustment is made to a hospital's target 
amount, such as when a hospital adds a 
new and substantially different service. 
Such an addition would create the need 
for additional staff and also could result 
in treating a different kind of patient. 
However, only those costs associated 
with the addition of a new service 
would be included in the permanent 
adjustment made to the provider’s rate- 
of-increase limit. 

2. Assignment of a New Base Period 

Section 6015(a) of Public Law 101-239 
amended section 1886(b)(4)(A) of the 
Act to give the Secretary authority to 
assign a new base period to a hospital if 
it is more representative of the 
reasonable and necessary costs of its 
inpatient services. In the April 20,1990 
final rule with comment period (at 55 FR 
15157), we provided that we would 
authorize the assignment of a new base 
period only under limited circumstances 
and only when an adjustment cannot be 
accomplished through other provisions 
as discussed above. In order to justify 
the assignment of a new base period, a 
hospital must have a permanent, 
substantial, and significant change in 
the nature of services provided that 
results in costs exceeding its rate-of- 
increase limit. An example of such a 
change would be a psychiatric 
institution that previously had only 
provided limited care to its patient 
population and then had changed the 
entire focus of its work to providing a 
comprehensive range of psychiatric 
services to its patients. 

However, should a hospital 
experience a significant change in 
patient care services and its costs 
exceed the rate-of-increase limit, the 
remedy will not automatically be the 
assignment of a new base period. A 
general increase in costs beyond the 
limit is not grounds for rebasing. As 
discussed above, if a hospital adds a 
new service that results in increased 
costs, a permanent adjustment may be 
made to the hospital's limit to alleviate 
the distortion created by the new 
service and total rebasing would not be 
warranted. 

Another situation that could occur is 
that the hospital may have significantly 
changed its patient care services but all 
the costs incurred above the ceiling may 
not be reasonable and necessary. One 
area we give particular attention to in 
this respect is indirect costs (for 
example, administrative and general 
costs, and operation of plant.) The 
increases in indirect costs are often the 


result of factors that are not directly 
related to patient services; therefore, 
any excessive increases are not 
included in any adjustments and would 
not be included if the assignment of a 
new base period were approved. Rather, 
we expect cases of this nature to result 
in a rebasing of direct patient care costs 
only. 

Comment: We received a number of 
comments from national associations 
representing hospitals that are subject to 
the rate-of-increase limits. State hospital 
associations, and a State Department of 
Human Services that believe that the 
April 20,1990 final rule with comment 
period is too restrictive in setting forth 
the conditions under which we would 
approve the assignment of a new base 
period. Most of the commenters believe 
that our interpretation of the rebasing 
provision is inconsistent with 
Congressional intent. They construed 
the provision as broadening our 
authority to permit rebasing whenever a 
hospital demonstrates that its costs in a 
new base year are reasonable and 
necessary and more representative of 
current services than those in the 
original base year. They generally 
recommended that we authorize 
rebasing for a much wider variety of 
circumstances. One commenter believes 
that Congress provided the new 
authority because the current 
adjustment policy is too narrow and that 
rebasing should be used to mitigate the 
financial harm to hospitals that are paid 
under a system that was considered 
temporary when enacted 8 years ago. 
Other commenters asserted that 
rebasing should be allowed when the 
annual update factor has proved 
inadequate to cover the actual increase 
in a hospital's costs for the cost 
components that it is designed to cover. 

Response: We agree that the rule is 
restrictive in setting out the 
circumstances under which rebasing 
would be allowed. We do not agree, 
however, that our interpretation is 
contrary to Congressional intent. First, 
nothing in the statute or legislative 
history suggests that Congress intended 
us to implement this provision with 
broad and general criteria that would 
permit the widespread assignment of 
new base periods. In addition, we find 
significant the minimal cost attached to 
the rebasing provision by the 
Congressional Budget Office at the time 
of enactment. If general rebasing had 
been intended, the cost estimate would 
have been significantly higher. Finally, 
we believe it is more consistent with the 
policies underlying the rate-of-increase 
limits to view the rebasing provision as 
being simply an enhancement to the 
current exception and adjustment 


process that can be resorted to when the 
existing process proves inadequate to 
address a distortion in a hospital's base 
period or rate of increase. 

The broad interpretation of section 
1886(b)(4)(A) of the Act advocated by 
the commenters would have the effect of 
substantially revamping the payment 
methodology for excluded hospitals. It is 
evident that the commenters see the 
rebasing option as a means of 
alleviating difficulties caused by the 
inability of many hospitals to remain 
within their target limits. However, the 
commenters’ view of the provision 
would put it at odds with the basic 
premise of the rate-of-increase 
limitation, which is to hold hospitals to 
the annual rate of increase except when 
events beyond a hospital's control or 
extraordinary circumstances warrant an 
adjustment. It would be unlikely for 
Congress to make a major change in the 
rate-of-increase methodology without 
providing a clear statement of that 
intent. Moreover, Congress has 
requested a report on alternative 
payment methodologies for excluded 
hospitals, due October 1,1990. It would 
be incongruous to believe Congress 
intended that we authorize a general 
rebasing, which would be tantamount to 
a major revision in payment 
methodology, while simultaneously 
requesting recommendations on 
alternative payment methodologies. 

Therefore, this provision will remain 
unchanged in granting the assignment of 
a new base year in those limited 
circumstances in which a hospital 
demonstrates that there has been a 
permanent, significant, and substantial 
change in the nature of services 
provided that results in costs exceeding 
its target amount. Typically, the 
rebasing provision will apply in 
situations in which there has been a 
significant change in patient services 
such as that associated with a major 
expansion or change in the type of 
programs provided by an excluded 
hospital or unit, a change of ownership, 
or where significant cost increases have 
incurred in order to meet certification or 
accreditation needs. These are 
situations involving broad, substantial 
changes that cannot be adequately 
accounted for under the more targeted 
exceptions and adjustments process. 

Comment: In arguing for a broader 
interpretation of the rebasing provision, 
commenters mentioned numerous 
factors that they believe were not 
addressed by the annual update factor. 

It was their contention that since the 
update factor did not adequately reflect 
the costs incurred by hospitals in 
various circumstances, Congress 








36flg4 Federal Regigt er / VoL 55, No. 171 / Tuesday. September 4, 1990 / Rules and Regulations 


authorized rebasing as a means of 
compensating for these costs. The 
factors mentioned were: new 
technology, union contracts, employee 
benefit costs, food service, competition 
for competent personnel, case-mix 
changes, service intensity increases, and 
a lower base year average length of stay 
than in subsequent years. 

Response: The current exception and 
adjustment process accommodates 
changes from the base year in average 
length of stay and service intensity. As 
far as the other factors are concerned, 
they are accommodated by the annual 
update factor. We do not believe that 
Congress authorized rebasing under the 
exceptions and adjustments authority 
under section 1880(b)(4)(A) of the Act as 
a means of subsidizing hospitals that 
have been confronted with some of the 
factors listed by the commenters and 
were unable to address them within 
their target limitation. One of the 
assumptions behind limiting costs to a 
predetermined ceiling is that if a 
hospital needed to increase cost in one 
area beyond the average amount 
provided by the update factor, cost 
containment measures would be 
exercised in other areas. 

Comment. One commenter claimed 
that the conditions set forth for rebasing 
further cloud the confusing set of 
existing criteria for exceptions and 
adjustments. The commenter indicated 
that the distinctions among the three 
mechanisms are difficult for hospitals to 
understand and that the documentation 
required for each of them is not clear. 

The commenter suggested that we set 
out which circumstances warrant which 
kind of relief and that the application 
process provide that if rebasing was not 
justified, the same application could 
then be used for considering a more 
limited adjustment to the target rate of 
increase. The commenter also objected 
that hospitals are required to apply year 
after year for relief when the same 
circumstances persist indefinitely. 

Response: The regulations 
implementing the provision are found at 
§ 413.40. The bases for relief under 
§ 413.40 are as follows: 

• New Provider Exemption (§ 413.40(f)) 

A new hospital may receive an 
exemption from the rate-of-increase 
limits until the end of the first cost 
reporting period beginning at least 2 
years after the hospital accepts its first 
patient. 

• Exceptions and Adjustments 
(5 413.40(g) and § 413.40(h)) 

An exception or adjustment may be 
granted only for a cost reporting period 
in which the target amount is exceeded 


and only when the costs in excess of the 
target amount are reasonable and 
justified. The adjusted target amount 
may not exceed the hospital’s actual 
cost per discharge for that cost reporting 
period. Under 5 413.40(g), an exception 
may be granted for extraordinary 
circumstances or a change in case mix. 
Extraordinary circumstances are events 
such as earthquake, fire, flood, strike, or 
other unusual circumstances beyond a 
hospital's control that cause the hospital 
to incur excessive costs. The exception 
for case mix was originally established 
when acute care hospitals were also 
subject to the rate-of-increase limit 
Since there is no good measurement of 
case mix for most types of hospitals that 
are excluded from the prospective 
payment system, any increases in costs 
resulting from a change in the mix of 
patients must be documented: evidence 
of a change in patient mix without 
supporting documentation as to how the 
change affected specific costs is not 
sufficient to support an adjustment 
under § 413.40(g). 

The most common adjustment to the 
target amount is to correct for cost 
distortions between the base year and 
the year the target amount is applied 
under § 413.40(h). The premise of the 
rate-of-increase limit is that a hospital's 
year-to-year costs should remain 
comparable to the base year unless 
significant changes occur in services or 
patient population. If there are 
significant changes during the course of 
a cost reporting period that create a cost 
distortion in comparison to the base 
year, an adjustment will be made to 
remove the effects of the distortion. 

There are a variety of factors that could 
create distortions and result in the 
noncomparability of cost reporting 
periods; however, in order for HCFA to 
approve an adjustment, these factors 
must be linked to direct patient care 
services and their impact on operating 
costs per case must tie explicitly 
documented. We approve an adjustment 
for only a particular cost reporting 
period if the circumstances creating the 
cost distortion are temporary or prone to 
fluctuation from year to year, such as a 
change in average length of stay. If the 
change is permanent, such as the 
addition or deletion of a service, a 
permanent adjustment is made to the 
target amount. 

• Assignment of a New Base Period 
(§ 413.40{j)). 

Effective with cost reporting period 
beginning on or after April 1,1990. a 
new base period will be assigned to 
address substantial and permanent 
changes in patient care services that are 
so broad in nature that the resulting cost 


distortion cannot be adequately 
addressed through the more targeted 
excepted and adjustments available 
under 413.40(g) and 413.40(h). As is the 
case with an exception or adjustment, 
rebasing will be authorized only if the 
hospital’s operating costs per discharge 
are in excess of its target amount. 

• Medicare Catastrophic Coverage Act 
of 1983(5 413.40(i)). 

As explained in greater detail in 
section 1I.F of the preamble of this 
document, below, the intermediary is 
authorized to revise the target amount to 
take into account the effects of 
expanded inpatient hospital benefits 
under catastrophic coverage. Unlike 
other adjustments to the target amount, 
the adjustment is not contingent on 
whether the hospital’s operating costs 
per discharge exceed its target amount. 
An adjustment under S 413.40(i) does 
not preclude an additional adjustment 
under 413.40(h) for an increase in 
average length of stay. 

A hospital's request for an exemption 
or revision in its target amount must be 
made to its fiscal intermediary no later 
than 180 days from the date on the 
intermediary’s notice of program 
reimbursement. The hospital's request 
must indicate the type of relief being 
requested, provide justification and 
documentation supporting the request, 
and, in the case of requests for an 
exception, adjustment or rebasing, 
explain any significant cost increases 
since the base period. The intermediary 
has the authority to revise the target 
amount under § 413.40(i) for the effects 
of the Medicare Catastrophic Coverage 
Act of 1983. On all other requests, the 
intermediary makes a recommendation 
to HCFA, which makes the decision. 

We will soon be issuing instructions 
to be included in the Provider 
Reimbursement Manual (HIM-15-1) that 
provide more detailed guidelines for 
making applications for exemptions, 
exceptions, and adjustments. These 
instructions will elaborate on the 
circumstances applicable to the various 
bases for relief available under § 413.40 
and the application process. As 
suggested by the commenter, the 
instructions will indicate that the same 
application may be used to request relief 
under more than one provision. 

Comment: One commenter found the 
April 20 Final rule with comment 
inconsistent with current practice that 
gives the Medicare fiscal intermediary 
authority to calculate target rates and 
target rate adjustments. The commenter 
asserted that the authority to assign new 
base periods should remain with the 
fiscal intermediaries due to their 








Federal Register / Vol. 55. No. 171 / Tuesday, September 4. 1990 / Rules and Regulations 360«5 


familiarity with the hospitals’ 
circumstances and because it would 
result in more timely and possibly less 
biased decisions if our budgetary 
restraints were removed from the 
decision process. 

Response: Section 1886(b)(4)(A) of the 
Act gives the Secretary authority to 
assign a new base year under his 
general exception and adjustment 
authority that applies to the target rate 
of increase provision. The fiscal 
intermediaries make recommendations 
on requests for exceptions and 
adjustments under §5 413.40(g) and 
413.40(h) and will do 30 on new base 
year requests under § 413.40(j). The final 
authority for approval of these requests 
is with HCPA. acting for the Secretary. 

The commenter appears to have 
confused §§ 413.40(g) and 413.40(h) with 
§ 413.40(i). Under § 413.40(1), the fiscal 
intermediary does have the authority to 
make target rate calculations and 
adjustments for the provisions of Public 
Law 100-300. This authority, however, 
pertains only to § 413.40{i) and is 
specific to the circumstances set forth 
under Public Law 100-360. 

Comment r The majority of the 
commentcrs on the rebasing provision 
were critical of what they thought was 
our position in the April 20,1990 final 
rule with comment period not to 
recognize indirect costs in the rebasing 
calculation. Several of these 
commenters objected to what they 
thought was our characterization of 
indirect costs as unnecessary and 
unreasonable. The commenters strongly 
urged that we should include the same 
kinds of costs in the rebasing calculation 
as were recognized in the original base 
year target rate calculation, including 
reasonable and necessary indirect costs. 

Response: In the preamble discussion 
on the rehasing provision, we indicated 
that increases in indirect costs often 
result from factors that are not directly 
related to patient care and, therefore, 
would not be included in any 
adjustment if the assignment of a new 
base period were approved. Our 
intention was to emphasize that any 
adjustment for indirect costs increases 
above the target rate of increase 
limitation would be limited to those 
increases that resulted from significant 
changes in patient care services. We did 
not intend to imply that no increases in 
indirect costs would be recognized. We 
would recognize without additional 
justification increases in allowable 
indirect costs equivalent to the 
percentage increase in the target rate. 
However, if the allowable indirect costs 
increase at a higher rate than the target 
rate percentage increase, we would not 
include the additional indirect costs in 


the target rate adjustment unless the 
hospital documents that they are 
directly related to a significant change 
in the patient care services. 

F. Medicare Catastrophic Coverage 
Repeal Act of 1909 

1. Medicare Catastrophic Coverage Act 
of 1988 

After publication of a May 27.1988 
proposed rule concerning changes to the 
inpatient hospital prospective payment 
system and FY 1989 rates, on July 1. 

1988, Public Law 100-360 was enacted. 
Under section 101(2) of 100-360, 
essentially unlimited inpatient hospital 
days were made available for Medicare 
beneficiaries (except for the inpatient 
psychiatric day limitation) effective for 
services furnished on or after January 1, 

1989. Before enactment of Public Law 
100-360, a beneficiary was entitled to 90 
days of inpatient hospital services 
during each spell of illness. In addition, 
a beneficiary could draw from a lifetime 
reserve of GO days if that beneficiary’s 
inpatient hospital days exceeded 90 
days in a spell of illness. Under that 
system, a hospital could bill the 
beneficiury or the beneficiary’s third 
party insurer for inpatient hospital 
services furnished to a beneficiary 
whose inpatient hospital benefits were 
exhausted. 

Hospitals and hospital associations 
expressed concern to Congress that they 
would be financially disadvantaged by 
not being permitted to bill beneficiaries 
or their third party insurers for inpatient 
hospital services that, before enuctment 
of Public Law 100-360, were not covered 
because beneficiaries had exhausted 
their inpatient hospital benefits. 
Therefore, Public Law 100-360 required 
the Secretary to take into consideration 
reductions in payments by Medicare 
beneficiaries to prospective payment 
hospitals due to the elimination of a day 
limitation on inpatient hospital services 
caused by the provisions of section 101 
of Public Law 100-360 when establishing 
the prospective payment rates, outlier 
thresholds, and diagnosis related group 
(DRG) weighting factors for FY 1989. In 
addition, section 104(c)(2) of Public Law 
100-360 required the Secretary, when 
increasing the target amounts for 
hospitals excluded from the prospective 
payment system, to take into 
consideration on a hospital-specific 
basis, the same reduction in payments to 
excluded hospitals for cost reporting 
periods beginning on or after October 1, 
1988. 

2. The September 30,1988 Final Rule 

On September 30,1988, we published 
the final rule (53 FR 38470) on changes to 


the inpatient hospital prospective 
payment system and 1989 rates. In 
that rule, we implemented the provisions 
of Public Law 100-380, pertaining to the 
adjustment in the prospective payment 
system and in the rate-of-increase limit 
to take into account the impact of 
catastrophic coverage. We requested 
public comment on those changes. 

We determined that the prospective 
payment system would automatically 
adjust to the expansion of inpatient 
hospital benefits as increased payments 
would occur automatically as DRG 
payments were made for entire stays, 
including outlier portion thereof, that 
previously would not have been 
covered. Therefore, we concluded no 
explicit adjustments were necessary. 

With respect to the adjustment in the 
rate-of-incrcase limit, we provided in the 
September 30,1988 final rule that 
hospitals and hospital units excluded 
from the prospective payment system 
may apply for increases to their target 
rale 9 to correct any distortion due to 
higher costs caused by the expansion of 
inpatient hospital benefits due to the 
provisions of section 101 of Public Law 
100-360. We provided for the adjustment 
under section 104(c)(2) of Public Law 
100-360 to be available to any hospital 
that experiences a distortion due to 
increased costs caused by elimination of 
the inpatient coverage limitation, 
whether or not the hospital actually 
exceeds its target rate. This is because 
any distortion would be due to the effect 
of section 101 of Public Law 100-300 and 
would be essentially unrelated to the 
actions of any individual hospital—it is 
a circumstance that could potentially 
affect all hospitals to some degree. We 
provided that a hospital may request a 
target amount adjustment directly from 
its intermediary. The target amount 
would be adjusted for the impact of any 
reduction in Medicare payments that the 
hospital experienced because of the 
previous inpatient day benefit 
limitation. The adjustment would be 
based on the estimated incremental 
costs of care historically furnished to 
Medicare beneficiaries after they had 
exhausted benefits during an inpatient 
stay. 

We provided that a hospital may 
request an adjustment from its 
intermediary after the effective date of 
the September 30,1988 final rule (that is, 
October 1,1988) but no later than 180 
days after the closing date of the 
hospital’s first cost reporting period 
beginning on or after October 1.1908. In 
order for its request to be considered, 
we provided that a hospital must submit 
a written request for an adjustment to 
its target amount under authority of this 










35006 Federal Register / Vol, 55, No. 171 / Tuesday. September 4, 1990 / Rules and Regulations 


provision along with the following 
supporting documentation: 

• A statement from the hospital 
stating whether the adjustment is to be 
based on its historical experience in its 
base period or its last cost reporting 
period beginning before October 1,1988. 
(If this period is not of at least 12 
months in duration, multiple consecutive 
cost reporting periods comprising at 
least 12 months must be used.) 

• Billing data for the period that 
serves as the basis for the adjustment 
documenting the following: 

—The number of hospital inpatient days 
furnished to Medicare beneficiaries for 
which no payment was made because the 
beneficiary had exhausted Part A hospital 
benefits. (Excluded from the count are days 
for stays that were not covered in their 
entirety, since such stays will be paid as 
discharges after January 1.1989.) 

—The ancillary charges for services 

furnished on the days after the beneficiary 
had exhausted Part A hospital benefits, as 
counted above. 

Upon receipt of a request for an 
adjustment by a hospital that includes 
the required information, the 
intermediary will verify the data. 
submitted by the hospital regarding 
beneficiary status and exhaustion of 
inpatient hospital entitlement. (Medical 
necessity of acute care for inpatient 
days following exhaustion of 
entitlement would be assumed.) 

In order to adjust the target amount, 
the intermediary will— 

• Estimate the total inpatient 
operating costs for services furnished to 
Medicare beneficiaries, including the 
costs of services furnished after a 
beneficiary had exhausted benefits; 

• Take the ratio of the above- 
determined costs to the Medicare 
allowable inpatient operating costs for 
the period from which the hospital’s 
data are derived; and 

• Apply this ratio to the otherwise 
applicable target amount for cost 
reporting periods beginning on or after 
October 1,1988. 

We indicated that the intermediary 
will determine the amount of any 
appropriate adjustment and notify the 
hospital of its determination within 90 
days of the date of receipt of the 
request. 

3. The Family Support Act of 1988 

Subsequent to the publication of the 
September 30,1988 final rule, the Family 
Support Act of 1988 (Pub. L 100-485) 
was enacted on October 13,1988. 

Section 608(d) of Public Law 100-485 
made several technical corrections to 
Public Law 100-360, including the 
following changes concerning provisions 


of Public Law 100-360 implemented in 
the September 30,1988 final rule: 

• Section 608(d)(3)(D) of Public Law 
100-485 revised section 104(c)(2) of 
Public Law 100-360 to change the date 
for implementing the target rate 
adjustments from cost reporting periods 
that begin on or after October 1,1988 to 
portions of cost reporting periods 
occurring on or after January 1.1989. 

• Section 608(d)(3)(E) of Public Law 
100-485 revised section 104(c)(2) of 
Public Law 100-360 to specifically 
provide that an adjustment for any 
distortion due to higher costs caused by 
the expansion of inpatient hospital 
benefits is to be made whether or not a 
hospital or unit actually exceeded its 
target rate. 

4. The Medicare Catastrophic Coverage 
Repeal Act of 1989 and the April 20,1990 
Final Rule With Comment 

The Medicare Catastrophic Coverage 
Repeal Act (Pub. L. 101-234) was 
enacted on December 13,1989. Under 
section 101(c) of Public Law 101-234, 
any adjustment in payments to hospitals 
under the prospective payment system 
as provided for in section 104(c)(1) of 
Public Law 100-360 ended effective with 
discharges occurring on or after January 
1,1990. Under section 101(c)(2)(A)(i) of 
Public Law 101-234, the adjustment to 
the target rates for hospitals excluded 
from the prospective payment system, 
as provided for in section 104(c)(2) of 
Public Law 100-360, was eliminated 
effective with portions of cost reporting 
periods occurring on or after January 1, 
1990. In addition, section 101(c)(2)(A)(ii) 
of Public Law 101-234 added 
clarification that in making any 
adjustment under section 104(c)(2) of 
Public Law 100-360, the adjustments to 
hospital target rates must be made 
disregarding whether a beneficiary had 
exhausted his or her Medicare benefits 
prior to January 1,1989. 

In the April 20,1990 final rule with 
comment that also implemented several 
provisions of Public Law 101-239 
concerning mid-year changes to the 
prospective payment system, we took 
into account the provisions of section 
104(c)(2) of Public Law 100-360 as 
amended by section 608(d) of Public 
Law 100-485 and by sections 101 (c) and 
(d) of Public Law 101-234 concerning the 
temporary elimination of the day 
limitation on inpatient hospital services. 

In addition, we requested comment on 
the transition provisions of Public Law 
101-234 that went into effect on January 
1,1990 and that were included in the 
April 20,1990 final rule with comment. 

We received no comments concerning 
the adjustments to prospective 
payments under Public Law 101-234. We 


have received 16 items of 
correspondence containing comments 
concerning the application of the 
transition provisions for target rate 
adjustments under Public Law 100-360. 

Comment: A commenter suggested 
that an extension of the 180-day period 
for hospitals to file for an adjustment to 
their target rate under 5 413.40(i) is 
needed since the information hospitals 
must provide with their application has 
been changed slightly by the April 20 
final rule with comment. 

Response: We do not believe that 
hospitals require an additional 180 days 
to secure the minor changes in data 
required by the April 20,1990 final rule. 
Moreover, once a hospital has filed for 
an adjustment under § 413.40(i). the 
hospital still has an opportunity to 
furnish additional information. 
Adjudication by the Medicare fiscal 
intermediary would not take place until 
the hospital has adequate time to secure 
any additional data. This has been the 
case with all exception requests since 
the hospital cost limits were originally 
imposed. 

Comment: Due to cash flow problems, 
several commenters suggested that if a 
cost report is filed by a hospital 
requesting a target amount adjustment 
(particularly if the hospital is seeking 
relief under 5 413.40(i)j, repayment of 
any amount owed by the hospital for the 
cost reporting period should be deferred 
until the adjustment request is 
adjudicated. 

Response: Delaying repayment of 
amounts owed by providers at the time 
of cost report filing would be 
inappropriate in light of requirements 
imposed by the Federal Claims 
Collection Act and the appeals process 
under section 1878 of the Act and 
5 405.1803 of the regulations. Neither 
would it be an appropriate practice to 
allow automatic delay of cost report 
filing requirements beyond the 90 days 
already allowed after the close of the 
cost reporting period under 
$ 413.24(f)(2). Due to the unique nature 
of Public Law 101-234, we provided 
special time-limited procedures to allow 
immediate interim payment rate 
adjustments and delays in filing cost 
reports for the periods affected by 
catastrophic coverage. We believe our 
temporary procedural changes 
adequately addressed this one-time 
problem. No ongoing changes to the 
process for target rate revisions under 
§ 413.40 is called for based on current 
program experience since a hospital can 
request an adjustment in its target 
amount and interim rate before the cost 
report is due as long as the hospital 








Federal Register / Voi. 55. No. 171 / Tuesday. September 4, 1990 / Rules and Regulations 36f 07 


provides adequate cost data and 
analysis for the affected period. 

Comment: A commenter suggested 
that some long-term care hospitals 
experience an annual crisis due to the 
current regulatory requirements to 
determine non-catastrophic adjustment 
requests on an annual basis, to base 
approval of such requests on whether 
costs exceed the target rate, and to 
process those requests separately from 
catastrophic adjustment requests. 

Response: Unless the circumstances 
giving rise to the exception or 
adjustment are permanent, we grant 
only a one year adjustment to the target 
amount. As we have advised in 
responding to comments on previous 
changes in adjustment and exceptions 
policies, we do not believe that it is the 
intent of the statute to create incentive 
payment situations in determining the 
amount of an adjustment to which a 
hospital may be eligible. We have found 
that the circumstances that cause 
hospitals to exceed their target amount 
vary significantly from year-to-year. As 
a result, an adjustment granted in one 
year are often not applicable in 
subsequent cost reporting periods. If we 
were to revise permanently the target 
amount for temporary cost distortions or 
circumstances that result in fluctuating 
costs from year-to-year, we would 
create the potential for inappropriate 
incentive payments. However, we 
frequently direct intermediaries to make 
interim payment and subsequent year 
adjustments to the target amount 
without further HCFA involvement as 
long as the circumstances occurring in 
the subsequent period are comparable to 
those giving rise to the initial 
adjustment. 

We note that the conditions 
established by statute for an adjustment 
for the effects of Medicare catastrophic 
coverage changes are not comparable to 
the conditions under which other 
exceptions to the target amounts are 
granted. The catastrophic adjustment is 
granted without regard to whether the 
hospital exceeds its target amount. 
Recognizing the impact of the 
catastrophic coverage provision on long¬ 
term care hospitals and other hospitals 
with long slay cases, we have taken 
many procedural steps to alleviate their 
cash flow difficulties. We issued 
instructions to Medicare fiscal 
intermediaries that initiated parallel 
processing of catastrophic and other 
exception adjustment requests. We 
temporarily extended cost reporting 
submission dates. We provided 
instructions to allow submission of 
preliminary data to make interim 
adjustment determinations in order to 


reduce or eliminate provider repayments 
on tentative settlement of cost reports. 

We do not believe that the process for 
exceptions and adjustments need further 
revision. In addition, with repeal of 
Public Law 100-360 these commenters 
concerns will be substantively resolved 
in the future. 

Comment: One commenter objected to 
an implied requirement to count 
discharges for patients who had 
exhausted Part A benefits in a cost 
reporting period other than the one used 
for adjustment under § 413.40{i). 

Response: Depending on the year 
involved, we have found that hospitals 
may have recorded discharges for 
Medicare purposes either at the time of 
Part A exhaustion or at actual physical 
discharge from the hospital. This 
inconsistency occurred due to the fact 
that billing instructions for Part A 
discharges from acute care hospitals 
were revised in 1984 to conform to 
prospective payment system 
requirements. However, the policy 
applicable at all times to excluded 
hospitals and units is to record the 
discharge at the time the patient 
physically leaves the facility. For 
purposes of determining discharges in 
the year used to determine the 
catastrophic adjustment, a discharge 
should be recorded only at the time a 
beneficiary was physically discharged 
from the facility. For patients who 
exhausted Part A benefits in a cost 
reporting period other than the one used 
for the catastrophic adjustment, a 
discharge will be counted if the patient 
was physically discharged during the 
adjustment cost reporting period. If the 
discharge was properly recorded for that 
year, a second discharge would not be 
counted in determining the adjustment. 

Comment: One commenter alleged 
that we were applying an unwritten 
policy of requiring beneficiaries to use 
all lifetime reserve days for purposes of 
determining the point at which days 
after exhaustion of benefits could be 
counted for use in making the 
adjustment under $ 413.40(i). 

Response: The Medicare program has 
had longstanding rules at § 409.65 
regarding the use of lifetime reserve 
days when a beneficiary has exhausted 
the 90 regular benefit days of inpatient 
hospital service. Those rules require that 
beneficiaries or their legal 
representatives file a statement of 
election not to use such days. Only in 
the case in which a hospital's average 
daily charge is equal to or less than the 
applicable coinsurance amount can an 
election not to use the lifetime reserve 
days available be considered automatic. 


or deemed, without the filing of an 
election statement. 

Medicare fiscal intermediaries have 
found that some hospitals requesting an 
adjustment under 5 413.40(i) have not 
been able to document for the benefits 
exhausted cases used to determine the 
amount of the adjustment either that the 
beneficiary elected not to use his or her 
lifetime reserve days or that the average 
daily charge was less than the 
coinsurance amount. As a result, a 
determination must be made regarding 
whether the available lifetime reserve 
days should have been utilized in these 
cases. The adjustment must include only 
those costs for which Medicare 
additional days of care would be paid 
for under catastrophic coverage rules 
that would not have been payable in the 
absence of catastrophic coverage. We 
have not applied an unwritten policy in 
determining the days after exhaustion of 
benefits in making the catastrophic 
adjustment to the target rates. However, 
we are holding in abeyance adjustments 
for days that potentially could have 
been lifetime reserve days pending the 
intermediary's determination that the 
hospital properly ended Medicare 
coverage for beneficiaries when lifetime 
reserve days may have been available. 

We are currently investigating 
whether these hospitals correctly 
applied the previsions of § 409.65 in not 
billing Medicare for inpatient days 
which could have been covered as 
lifetime reserve days. If the days should 
have been billed as lifetime reserve 
days, the number of inpatient days after 
exhaustion of Part A benefits that are 
used to determine the additional days of 
care that would be covered under the 
catastrophic provision would be 
reduced. We have asked the fiscal 
intermediaries to review each hospital's 
request for a catastrophic adjustment 
using the appropriate criteria in § 409.65 
to determine the appropriate treatment 
of potential lifetime reserve days. 

Unless the beneficiary elected not to use 
these days or was properly deemed to 
have made such an election, these days 
would count as Medicare covered days 
under pre-catastrophic coverage rules. If 
the file documents that the beneficiary 
elected not to use available lifetime 
reserve days (or was properly deemed 
to make such an election), these days 
would count as additional days of care 
available under catastrophic coverage. 

Comment: Commenters noted that the 
rules providing for implementation of 
the revised target amount under Public 
Law 106-360 did not include application 
of the transition provisions of section 
101(c)(2)(B) of Public Law 101-234. They 
asked that the final rule be revised to 










3s008 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rales and Regulations 


provide for consideration of this 
provision. 

Response: We concur with the 
comments on the transition provisions of 
Public Law 101-234. In accordance with 
section 101(c)(2)(B) of Public Law 101- 
234, we are revising the regulations to 
require that the Public Law 100-360 
target rate revision will be applied to 
Medicare discharges occurring on or 
after January 1,1990, if those cases were 
admitted as inpatient Medicare 
beneficiaries before that date. We note 
that the full adjusted target rate (based 
on unlimited hospital days) will apply to 
these discharges even though the benefit 
period limitation will apply to the 
portion of the stay occurring in 1990. 

Comment: Several commenters 
recommended that the days, costs, and 
discharges for Medicare patients be 
included in the target rate adjustment 
even when those individuals had 
exhausted their eligibility to Medicare 
Part A benefits prior to admission. The 
commenters cited the legislative history 
of Public Law 101-234 as support for 
their position that we should include the 
cost of these patients in the catastrophic 
adjustment. Several commenters 
presented data from selected hospitals 
indicating that individuals who had 
exhausted Medicare inpatient hospital 
benefits prior to admission may have 
longer length of stays than eligible 
Medicare beneficiaries who exhausted 
their inpatient hospital benefits after 
admission. 

Response: Section 101(c)(2)(A)(ii) of 
Public Law 101-234 clarified that the 
adjustment to the target amount should 
be made without regard to whether a 
beneficiary had exhausted benefits prior 
to January 1.1989. Our policies do 
provide for including the days and cost 
for Medicare beneficiaries who 
exhausted inpatient hospital benefits 
after admission, but prior to January 1, 
1989. We are presuming that since at 
least a portion of the stay was covered 
by Medicare, the stay would have been 
covered in its entirety in the absence of 
the precatastrophic limitation on 
inpatient hospital days. If an individual 
was admitted after inpatient hospital 
benefits had been exhausted, however, 
that patient is not a Medicare 
beneficiary at admission. In such cases, 
there is no way for us to determine 
whether the patient received a hospital 
level care throughout the stay. Thus, 
although some evidence was submitted 
to indicate these patients may have a 
longer length of stay, no evidence was 
submitted that indicate that the longer 
stays would have been covered by 
Medicare and that the cost per 
discharge for the portions of stays that 


would have been covered was higher 
than for beneficiaries who exhausted 
benefits after admission. 

Although such individuals’ costs may 
not be included in the target rate 
adjustment under § 413.40(i), their costs 
would be paid for under the catastrophic 
provisions once Medicare coverage was 
reestablished after January 1,1989 if 
they remained an inpatient and required 
hospital-level care. Thus, hospitals 
would receive payments for the costs of 
such inpatients once Medicare 
beneficiary status was reestablished 
under Public Law 100-380. This policy is 
consistent with the amendment made by 
section 104(c)(2)(A)(ii) of Public Law 
101-234, which amended section 
104(c)(2) of Public Law 100-360 to 
require that the adjustment to the target 
rate for discharges occurring in portions 
of cost reporting periods beginning on or 
after January 1.1989 and before January 
1,1990 be made without regard to 
whether such beneficiaries exhausted 
their benefits before January 1,1989. The 
adjusted target rate is also to apply to 
any discharge occurring on or after 
January 1,1990 if the admission 
occurred before January 1,1990. The 
adjusted target rate is applicable to all 
Medicare discharges occurring within 
the specified timeframes, regardless of 
whether benefits were exhausted before 
January 1,1989 or before admission to 
the hospital. As a result of these factors, 
we do not find it appropriate to revise 
our rules regarding exclusion of costs for 
patients who had exhausted Medicare 
benefits prior to admission in revising 
the target rate for catastrophic purposes. 

III. Changes to DRG Classifications and 
Weighting Factors 

A. Background 

Under the prospective payment 
system, we pay for inpatient hospital 
services on the basis of a rate per 
discharge that varies by the DRG to 
which a beneficiary’s stay is assigned. 
The formula used to calculate payment 
for a specific case takes an individual 
hospital’s payment rate per case and 
multiplies it by the weight of the DRG to 
which the case is assigned. Each DRG 
weight represents the average resources 
required to care for cases in that 
particular DRG relative to the average 
resources used to treat cases in other 
DRGs. 

Congress recognized that it would be 
necessary to recalculate the DRG 
relative weights periodically to account 
for changes in resource consumption. 
Accordingly, section 1886(d)(4)(C) of the 
Act requires that the Secretary adjust 
the DRG classifications and weighting 
factors annually beginning with 


discharges occurring in FY 1988. These 
adjustments are made to reflect changes 
in treatment patterns, technology, and 
any other factors that may change the 
relative use of hospital resources. The 
changes to the DRG classification 
system and the recalibration of the DRG 
weights for discharges occurring on or 
after October 1,1990 are discussed 
below. 

B. DRG Reclassification 
1. General 

Cases are classified into DRGs for 
payment under the prospective payment 
system based on the principal diagnosis, 
up to four additional diagnoses, and up 
to three procedures performed during 
the stay, as well as age, sex, and 
discharge status of the patient. The 
diagnostic and procedure information is 
reported by the hospital using codes 
from the International Classification of 
Diseases, Ninth Edition, Clinical 
Modification (ICD-9-CM). The 
intermediary enters the information into 
its claims system and subjects it to a 
series of automated screens called the 
Medicare Code Editor (MCE). These 
screens are designed to identify cases 
that require further review before 
classification into a DRG can be 
accomplished. 

After screening through the MCE and 
any further development of the claims, 
cases are classified by the GROUPER 
software program into the appropriate 
DRG. The GROUPER program was 
developed as a means of classifying 
each case into a DRG on the basis of the 
diagnosis and procedure codes and 
demographic information (that is, sex. 
age, and discharge status). It is used 
both to classify past cases in order to 
measure relative hospital resource 
consumption to establish the DRG 
weights and to classify current cases for 
purposes of determining payment. 

Currently, there are 477 DRGs in 23 
major diagnostic categories (MDCs). 
Most MDCs are based on a particular 
organ system of the body (for example. 
MDC 6. Diseases and Disorders of the 
Digestive System); however, some 
MDCs are not constructed on this basis 
since they involve multiple organ 
systems (for example, MDC 22, Burns). 

In general, principal diagnosis 
determines MDC assignment. Within 
most MDCs, cases are then divided into 
surgical DRGs (based on a surgical 
hierarchy that orders individual 
procedures or groups of procedures by 
resource intensity) and medical DRGs. 
Medical DRGs generally are 
differentiated on the basis of diagnosis 
and age. Some surgical and medical 









Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Rules and Regulations 36003 


DRGs are further differentiated based 
on the presence or absence of 
complications or comorbidities 
(hereafter CC) only. Generally, 
GROUPER does not consider other 
procedures: that is, nonsurgical 
procedures or minor surgical procedures 
generally not done in an operating room 
are not listed as operating room (OR) 
procedures in the GROUPER decision 
tables. However, there are a few non- 
OR procedures that do affect DRG 
assignment for certain principal 
diagnoses, such as extracorporeal shock 
wave lithotripsy for patients with a 
principul diagnosis of urinary stones. 

We proposed to make several changes 
to the DRG classification system. These 
proposed changes and the comments we 
received concerning them as well as our 
responses are set forth below. In 
addition to comments related to each of 
the specific proposed DRG classification 
changes, we received three general 
comments, as follows: 

Comment: One commenter objected to 
the 2-month comment period as being 
unreasonable to assess the impact of 
proposed changes in DRGs. Because the 
GROUPER software will not be updated 
until the implementation of the final 
rule, this commenter had insufficient 
time to analyze the exact impact of the 
proposed DRG changes. 

Response: Section 1866(e)(5) of the 
Act requires the Secretary to publish, by 
the May 1 before each fiscal year, the 
Secretary’s proposed recommendation 
on an update factor for that fiscal year, 
and a final recommendation by 
September 1 of that year. Section 
1386(d)(4)(C) of the Act also requires the 
Secretary to adjust the DRG 
classification and weighting factors 
annually. It has been our practice to 
combine these requirements and to 
publish a proposed rule by May 1 and a 
final rule by September 1 of each year 
that set forth our recommendations on 
the update factor, our changes to the 
DRGs, and any other changes to the 
prospective payment system we believe 
are necessary. 

Publication of a proposed rule 
approximately May 1 does not allow for 
a comment period of more than 60 days, 
since we must have time to analyze and 
respond to public comment before 
publication of the final rule. In addition, 
we do not believe publication of a 
proposed rule before May 1, which 
would allow a longer comment period, is 
practical because it would not allow us 
time to accumulate sufficient data for 
statistical analysis, and. thus, our 
proposals could not be based on the 
most current data possible. 

Comment We received one letter 
commenting that the proposed changes 


in the length of stay for the orthopedic 
procedures, as set forth in the proposed 
rule, were not in the best interest of 
patient care and, in the long term, may 
add to the cost of caring for these 
patients by encouraging premature 
discharge. The commenter requested 
that we reconsider these lengths of stay. 

Response: Length of stay figures are 
derived from the Medicare inpatient 
discharge claims data; the figures in 
Tables 5 and 7 (which report length of 
stay) were based on FY 1989 data. Table 
5 presents the geometric mean length of 
stay, which is used only to establish the 
outlier threshold and determine 
payment for day outlier cases. Table 7 
presents the arithmetic mean length of 
stay, which is used solely for illustrative 
purposes. These length of stay Figures 
are informational only and are not a 
requirements of the prospective 
payment system. Under the prospective 
payment system, payment is made on an 
established amount per discharge by 
DRG and is not based on the length of 
time patients remain in the hospital. The 
prospective payment system does not 
place a limit on a patient's length of stay 
in a hospital. Further, the length of stay 
is not a factor in calculating the 
payment rate (other than in outlier 
cases) or in establishing the DRG 
weight. 

Comment: One commenter offered 
suggestions for improving the integration 
of new technology into the prospective 
payment system. The commenter 
believes that when HCFA revises DRG 
classifications and weights, it relics on 
resource consumption and overlooks 
other significant changes, such as new 
technology and changes in treatment 
patterns. The commenter believes that it 
is inappropriate to assign new 
technology-specific procedures to 
existing DRGs merely because costs are 
similar. The commenter suggests that 
HCFA use "clinical coherence" as an 
indicator of appropriate procedure 
grouping within a DRG. The commenter 
also suggests that new DRGs be 
considered if a new technology or 
treatment pattern offers significant 
benefits not otherwise available. 

The commenter also believes that the 
MEDPAR may be an inaccurate 
reflection of costa associated with new 
technology and treatment patterns. The 
commenter suggests that HCFA use a 
broader data base including non- 
Medicare cases and encourage the 
submission of data on treatment 
patterns and new medical products by 
hospitals, researchers, technology 
manufacturers, and medical 
practitioners. 

Response: HCFA considers the effects 
of new technology and changes in 


practice patterns on resource use when 
revising the DRG classification system 
and recalibrating the DRG relative 
weights. New technologies are 
incorporated into the prospective 
payment system based on the types of 
cases and procedures they are used in, 
using the procedure and diagnosis codes 
on the Medicare bill. Cases are assigned 
to a DRG that contains cases that are 
similarly clinically and in terms of 
resource use. One example of DRG 
classification changes made based on 
new technology and changes in 
treatment patterns is MDC 5, Diseases 
and Disorders of the Circulatory System. 
(See section II.B.3 of this preamble.) 

The annual prospective payment 
system update factor is meant to 
recognize, among other factors, the 
impact of new technologies. In 
determining our recommended update 
factor, as required by section 1886(e)(4) 
of the Act, we include factors for 
changes in productivity and science and 
technology advancement as well as 
changes in practice patterns. (See 
appendix C of this final rule for our FY 
1991 recommended update factor.) Also, 
the DRG weighting factors are 
recalibrated each year based on the 
latest available charge data in order to 
ensure the distribution of Medicare 
payments across DRGs based on 
average resource costs. As charges for 
new technologies are incorporated into 
our data base, the DRG weight reflects 
the changes in the relative resource 
intensity of specific DRGs. We note that 
Medicare payment for capital-related 
technology costs are made as a pass¬ 
through on a reasonable cost basis and. 
therefore, are not included in the DRG 
payment. 

The MEDPAR file consists of 
Medicare bill information that is 
reported on the uniform bill form (UB- 
82) using a standard set of instructions. 
The diagnosis and procedure codes 
included on the bill are subject to a 
review for accuracy by the PROs. We do 
receive information on new technologies 
from hospitals, medical administrators 
and staff, researchers, and 
manufacturers and consider these data 
in our ongoing analysis of DRG 
classification. While this information is 
useful in our consideration of DRG 
classification, it is not uniform in several 
respects such as the time period and 
patient population covered or the factors 
included in the figures reported and. 
therefore, would not be useful in 
recalibrating the DRG relative weights. 
Although there is a 2-year time lag in the 
MEDPAR data used to analyze and 
recalibrate the DRG weights, we believe 
there would be a time lag involved in 








36010 Federal Register / Vol. 55. No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


collecting any set of comprehensive and 
accurate data. We believe that the 
MED PAR is the best source available 
because it consists of data that are 
uniform across all cases and are specific 
to the Medicare population. 

2. Creation of New DRGs 

In order to improve payment equity, 
we proposed to revise the DRG 
classification system by adding 13 new 
DRGs. Two of these DRGs are 
associated with the restructuring of 
MDC 5 (Diseases and Disorders of the 
Circulatory System) and are discussed 
below in section U1.D.3 of this preamble. 
The other 11 DRGs affect the assignment 
of the following types of cases: bone 
marrow transplants, liver transplants, 
tracheostomies, multiple significant 
trauma, and human immunodeficiency 
virus (HIV) infections. These are 
significant changes that we believe will 
increase the amount of variation in 
resource costs explained by DRGs by 
approximately 13 percent. 

Many of the changes we proposed 
build on the method of case 
classification used in New York State, 
which established a prospective 
payment system for all payers (except 
Medicare and CHAMPUS) effective 
January 1,1988. The New York system is 
based on the Medicare prospective 
payment system; however, New York 
State, in conjunction with 3M/Healtli 
Information Systems (HIS) (formerly. 
Health Systems International (HSI)). 
modified the Medicare DRGs to address 
the needs of the New York non- 
Medicare population. We modeled our 
proposed DRG changes for 
tracheostomy, multiple significant 
trauma, and ! 1TV cases on the New York 
system with modifications for the 
Medicare population. These DRG 
additions and the other DRGs we 
proposed to add (other than the MDC 5 
changes) are set forth below in this 
section. 

Previously. Medicare discharges were 
generally assigned to MDCs based on 
principal diagnosis and then further 
assigned to the surgical or medical 
DRGs included in those MDCs. 

1 lowever. we proposed to assign 
discharges to the proposed DRGs for 
liver transplants, bone marrow 
transplants, and tracheostomies based 
on the procedure codes rather than first 
assigning the discharges into one of the 
current MDCs based on principal 
diagnosis. 

The detailed description of the new 
DRGs are set forth below. 

a. Liver Transplants. Medicare 
coverage of liver transplants for children 
under the age of 18 for certain specified 
conditions has been in effect since 


February 9.1984. In a notice published 
in the Federal Register on March 8,1990 
(55 FR 8545), we proposed to expand 
coverage of liver transplants to adults 
with certain specified conditions. In that 
proposed notice, we stated that the 
effective date of coverage for these liver 
transplants would be March 8,1990 
under certain circumstances. Medicare 
payment will continue to be made for 
children’s liver transplants for biliary 
atresia (diagnosis code 751.61) and 
would be expanded to adult liver 
transplants performed in approved 
facilities for the following covered 
conditions. {The diagnosis code to which 
the condition is assigned is also noted.) 

• Primary hemochromatosis (275.0) 

• Wilson’s disease (275.1) 

• Alpha*1 antityrypsin deficiency 
disease (277.6) 

• Alcoholic cirrhosis (571.2) 

• Postnecrotic cirrhosis (Hepatitis B. 
antigen negative) (571.5) 

• Primary biliary cirrhosis (571.6) 

• Primary sclerosing cholangitis 
(578.1) 

These cases currently group to MDC 7 
and MDC 10. Within MDC 7, liver 
transplants are assigned to DRGs 191 
and 192) Pancreas, Liver and Shunt 
Procedures) *. Liver transplant cases in 
MDC 10 group to DRG 468 if no surgical 
procedure related to the patient’s 
principal diagnosis is performed. 

Since Medicare coverage of liver 
transplants has now been proposed for 
adults, we proposed to add a new DRG 
480 (Liver Transplant) exclusively for all 
liver transplants (whether adult or 
juvenile). \Ve proposed to assign 
Medicare discharges to DRG 480 only if 
either procedure code 50.51 (Auxiliary 
liver transplant) or 50.59 (Other 
transplant of liver) is performed at an 
approved liver transplant center and 
any one of the covered conditions (listed 
above) is either a principal or secondary 
diagnosis. These conditions are reported 
under the following diagnosis codes: 
275.0, 275.1. 277.6, 571.2, 571.5, 571.6, 

5781, or 751 61. 

As is currently our policy for organ 
acquisition costs in kidney and heart 
transplant cases paid under Medicare, 
we proposed to pay for liver acquisition 
costs separately on a reasonable cost 
basis. We proposed to revise 
§5 412.2(d)(4) and 412.113(d), which 
describe payment for kidney acquisition 
costs as a pass-through, to include heart 
and liver acquisition costs, also. We 
received no comment on the proposed 


' A single title combined with two DRG numbers 
is used to signify pairs, the first DRG of which is 
cases with CC and the second of which is cases 
without CC. If a third number is included, It 
represents cases of patients who are nge 0 - 17 . 


changes in the regulations and have 
included them as final in this document. 
However, we did receive comments 
concerning the treatment of bone 
marrow acquisition charges, which are 
discussed in section III.B.2.b of this 
preamble. In addition, we received 
several comments on our proposed liver 
transplant DRG as follows: 

Comment: One commenter was 
concerned with the treatment of liver 
transplant cases in non-Medicare- 
approved liver transplant centers. 
Specifically, the commenter is interested 
in how the GROUPER identifies whether 
a hospital is a Medicare-approved liver 
transplant center. If the hospital is not 
an approved center, the commenter 
wants to know if the patient would be 
assigned to DRG 480 (Liver Transplant) 
but not allowed payment, or if a portion 
of the hospital stay would be covered by 
Medicare. 

Response: Once the expanded 
coverage for liver transplants is final. 
Medicare payment will be made to 
approved transplant centers for covered 
liver transplants assigned to DRG 480. 
The Medicare Code Editor (MCE), not 
the GROUPER, will first identify the 
liver transplant cases by the procedure 
code (50.51 or 50.59); then, the 
intermediary will check the provider 
number to determine if the hospital is a 
Medicare-approved liver transplant 
center and the effective date for 
approval. If the other Medicare criteria 
for coverage are met, payment will be 
made for those cases in which the 
hospital is an approved transplant 
center and the transplant is performed 
on or after the approval date. If the 
hospital is not approved, and the liver 
transplant is the sole purpose of the 
admission, the bill is returned to the 
provider, and a “no pay bill” is 
requested. Neither physician services 
nor inpatient services associated with 
the transplantation procedure would be 
covered in this case. A case such as this 
would be assigned to DRG 480, but no 
Medicare payment would be made. 
Where a patient is admitted to a 
nonapproved transplant center for 
treatment of a liver or other condition 
and a decision to perform a liver 
transplant is made at a date subsequent 
to the admission, the bill will be 
processed through the GROUPER and 
assigned to the appropriate DRG for the 
covered part of the hospital stay. 
Therefore, a portion of the hospital stay 
not related to the transplant could be 
covered by Medicare as long as the 
reason for admission was not to receive 
a liver transplant 

Comment: A commenter believes that 
the linkage between Medicare coverage 









Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 36011 


policy and the DRG classification 
system is inappropriate and will cause a 
great deal of confusion among other 
users of the DRG classification system. 
The purpose of the DRG classification 
system is to classify patients, not to 
implement coverage policy. If a patient 
receives a liver transplant, the patient 
should be classified into the liver 
transplant category. If Medicare chooses 
not to cover the liver transplant or to 
cover the liver transplant for patients 
only with certain diagnoses, this should 
be a separate coverage decision. 

Response: The GROUPER software 
program classifies all cases and is not 
limited by Medicare coverage policy. 

The prospective payment system is 
based on reported diagnosis and 
procedure codes and is linked to 
Medicare coverage policy through the 
MCE for Medicare payment purposes. 

The MCE will be used to screen liver 
transplant cases for Medicare coverage. 
In the absence of the MCE edit, the 
GROUPER would assign all liver 
transplant cases to the liver transplant 
DRG regardless of the diagnosis. Thus, 
the coverage decision and the 
classification issue are handled 
separately. 

Comment: One commenter was 
concerned that 18 of the 24 cases used in 
determining the proposed weight did not 
have an acquisition charge listed and 
that this might indicate that these may 
not be liver transplant cases, but 
miscoded resections or shunt 
procedures. In the commenter’s 
experience, it is accepted practice to 
maintain organ acquisition charges as a 
separate line item when submitting bills 
for payment. 

Response: Organ acquisition costs, 
except for bone marrow acquisition 
costs, are paid as a pass-through on a 
reasonable cost basis under Medicare; 
thus, the DRG payment is not designed 
to cover the acquisition cost. Our policy 
has always been to assume that every 
bill for a transplant procedure also has 
included charges for organ acquisition. If 
no acquisition charge is separately 
identified on the bill, we have assumed 
that it was included in total charges. 
Thus, if a bill clearly shows an 
acquisition charge for an organ, we have 
deducted that charge prior to setting the 
DRG weights. If a bill does not 
separately identify an acquisition 
charge, we have deducted an estimate of 
those charges from the bill. 

Upon further investigation, we have 
concluded that some transplant bills 
may not include acquisition charges. 

1 lospitals that procure the organ for 
transplantation in their own facility 
should show the organ acquisition 
charge on the transplant patient’s 


Medicare bill. However, in cases where 
the organ is acquired from another 
facility through an organ procurement 
agency, the transplanting hospital may 
not include the organ acquisition charge 
a 9 a line item or in its total charges on 
the patient’s bill. Therefore, we are 
revising our methodology for adjusting 
the total charges for acquisition charges. 
We will no longer impute an organ 
acquisition charge for a bill that does 
not include a specific separate charge 
for organ acquisition. Only those cases 
showing an organ acquisition charge 
will have that charge subtracted from 
the total charges prior to using the 
charges in recalibrating the DRG weight. 

As for the possibility that these cases 
are miscoded, we reviewed our data to 
determine if the beneficiaries were 
inpatients of transplant centers. We 
identified three cases involving 
hospitals that are not transplant centers 
whose bills included a liver transplant 
procedure code. We removed these 
cases from the data base since, once the 
expanded coverage for liver transplants 
is final, payment will be made only to 
approved transplant centers. 

Comment: One commenter. while 
agreeing that a separate DRG for liver 
transplants is appropriate, was not 
convinced that the category is 
sufficiently well-defined for case-level 
prospective payment. The commenter 
also questioned if HCFA had evaluated 
whether separate DRG categories are 
indicated for different age patients or for 
multiple transplant patients. 

Response: We are required by 
provisions in section 1886(d) of the Act 
to pay for covered inpatient services 
furnished by an acute care hospital on a 
prospectively-determined amount per 
discharge that varies by the DRG to 
which the beneficiary’s case is assigned. 
As with DRG 302 (Kidney Transplant) 
and DRG 103 (Heart Transplant), the 
proposed DRG 480 (Liver Transplant) is 
well-defined clinically by the transplant 
procedure, which is unique from other 
surgical procedures. Also, the amount of 
resources used for liver transplants 
differentiates them from other types of 
cases in other DRGs. The alternative to 
a separate DRG for liver transplants 
would be to continue to classify them 
with less resource-intensive cases. 
Payment on a reasonable cost basis i9 
not an option under the law. 

We do not believe that it is 
appropriate at this time to propose a 
DRG for multiple transplant patients or 
for different age groups given our limited 
experience with Medicare liver 
transplant cases. The cases used to 
calculate the proposed DRG weight, as 
well as the final weight, included a 


multiple transplant case and patients 
ranging from 23 to 69 years of age. 

Comments: Several commenters 
expressed concern about the 34 percent 
reduction in the DRG weight of 21.0000 
for liver transplants announced in the 
Medicare proposal to cover adult liver 
transplants on March 8,1990 (55 FR 
8546) to the weight of 13.8965 as set forth 
in the May 9,1990 prospective payment 
system proposed rule (55 FR 19429). 

These commenters questioned the data 
used to determine these weights. Some 
commenters stated that their hospitals* 
average cost per case is significantly 
higher than the payment that would be 
provided by the proposed DRG weight 
of 13.8965. 

The commenters believe that the data, 
24 cases from 10 hospitals, used to 
determine the proposed DRG weight are 
too limited. They also questioned the 
availability of MEDPAR data on liver 
transplants, since liver transplants were 
not covered in FY 1989. One commenter 
suggested that we collect data from 
transplant centers, as we did to 
determine the heart transplant DRG 
weight when that procedure was first 
covered. 

One commenter stated that 4 percent 
of the liver transplant patients in his 
hospital are over the age of 65, and that 
the hospital’s data indicate that this 
population is more severely ill and 
develops more postsurgical 
complications. 

Another commenter believes that a 
minimum volume of 20 to 25 liver 
transplants per year is necessary in 
order to maintain the high surgical and 
nursing levels required to successfully 
treat these critically ill patients and, that 
if hospitals in our data base do not meet 
this minimum level, he questions 
whether their costs may be accurately 
representative of the cost incurred in 
liver transplants. 

One commenter recommended that 
the implementation of the proposed 
DRG weight of 13.8965 be delayed and 
the DRG weight of 21.0000 be retained 
pending further reconsideration of the 
data by HCFA. Another commenter 
recommended phasing-in the reduction 
with revisions based on more current 
data as Medicare claims are processed. 

It was pointed out that it would be 
useful to centers applying for Medicare- 
approved liver transplant center status 
to have the data used for the proposed 
DRG weight in order to determine if 
their costs are similar and to provide a 
clearer understanding as to why 
Medicare is proposing such a sharp 
decrease in the DRG weight. One 
commenter stated that the proposed rule 
did not include details of the data (that 





3g012 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rule 9 and Regulations 


is. range of charges, length of stay, and 
diagnosis codes). Another commenter 
suggested that we release the MEDPAR 
data for centers to review and comment 
on before finalizing the DRG weight 

Response : The proposed liver 
transplant DRG weight of 13.8965 was 
based on more current data than the 
DRG weight of 21.0000 and is weighted 
relative to the other DRGs that currently 
exist. The DRG weight of 21.0000 
published in the March 8,1990 proposal 
for Medicare coverage of adult liver 
transplants was based on FY 1984 
Medicare bill data and 1983 and 1984 
sample claims data. The proposed DRG 
weight of 13.6965 was based on FY 1989 
MEDPAR data for 24 liver transplant 
cases that meet the proposed Medicare 
criteria for coverage. We note that the 
Medicare DRG payment does not 
include payment for organ acquisition 
costs, payment for physicians, or 
payment for capital or other pass¬ 
through costs. Therefore, an accurate 
comparison cannot be made between a 
hospital’s cost per liver transplant case 
and the DRG payment in order to 
determine the amount that the payment 
exceeded or fell short of the cost of 
treating that case. 

We carefully reviewed the final FY 
1989 MEDPAR data for liver transplant 
cases to ensure that they met the 
proposed coverage criteria and were 
performed by hospitals that have the 
potential for becoming Medicare- 
approved transplant centers. This 
review resulted in the loss of three cases 
from three hospitals that are not liver 
transplant centers. In addition, in 
calculating the proposed DRG weight for 
DRG liver transplants, we subtracted an 
estimate of liver acquisition charges 
from the total charges of liver transplant 
cases if no acquisition charge was 
shown on the bill. As explained above 
in response to another comment, we 
have not done this on the final 
recalibration. We subtracted only 
acquisition charges from those bills that 
actually showed such charges. AH these 
steps have resulted in an increase in the 
weight for DRG 480. The final DRG 480 
weight is 15.2645. This weight is based 
on 29 liver transplant cases in the FY 
1989 MEDPAR data. 

We believe that 29 cases are adequate 
to establish a weight for liver 
transplants. The methodology to 
recalibrate the DRG weights (see section 
III.C of this preamble) requires a 
minimum of 10 cases to compute a 
reasonable DRG weight. Since the FY 
1989 MEDPAR data included more than 
10 (that is, 29) liver transplant cases that 
meet the proposed Medicare criteria for 
coverage, these cases were used to 


determine the liver transplant DRG 
weight in a manner consistent with the 
other DRG weights. When Medicare 
proposed to cover heart transplants on 
October 17.1986 (51 FR 37164), there 
were fewer than 10 heart transplant 
cases in the FY 1984 Medicare bill data. 
Therefore, we established the initial 
heart transplant DRG weight based on 
the most recent Medicare and non- 
Medicare charge data accumulated 
under the National Heart Transplant 
Study for procedures performed in 1983. 
The 29 liver transplant cases used to 
determine the DRG weight of 15.2645 
include patients ranging in age from 23 
to 69 years of age with only 4 patients 
over the age of 65. 

We have not accepted the suggestion 
to limit the data for the DRG weight 
determination to bills from hospitals 
with a minimum volume of 20 liver 
transplant bills per year, in part because 
we currently do not have available to us 
information on the number of liver 
transplants (Medicare and non- 
Medicare) performed per year by a 
given hospital. It is possible that the 29 
cases included in our analysis were, in 
fact, performed at transplant centers 
that would meet the suggested minimum 
volume of 20 transplants per year. We 
note that the actual requirements for 
approval as a Medicare-approved liver 
transplantation center are still under 
consideration and have not yet been 
published as final. However, in keeping 
with the spirit of the suggestion, we 
have excluded bills from three hospitals 
that we determined are not liver 
transplant centers. 

We disagree with the suggestion to 
delay or phase-in the reduction of the 
DRG weight as this weight is based on 
current data and is relative to the 
weights of the other DRGs. 

The MEDPAR data include detailed 
information on approximately 10 million 
Medicare discharges that were used to 
calculate the liver transplant DRG 
weight and all other DRG weights. 

These data are available to requestors 
at a cost of $2,870 for each fiscal year by 
submitting a written request to the 
following address: HCFA Office of 
Statistics and Data, Management, 

Bureau of Data Management and 
Strategy, Room 3-A-12 Security Office 
Park Building, 6325 Security Boulevard, 
Baltimore. MD 21207. 

(See the May 9,1990 proposed rule at 55 
FR 19461 for additional information 
concerning the MEDPAR data.) The 
conditions that will be covered and their 
corresponding diagnosis codes are 
included in the text of this section, and 
the length of stay information is 
included in Table 7B. 


Comment: Two commenters objected 
to the statement that teaching hospitals 
performing liver transplants would 
receive additional Medicare payment for 
the indirect medical education (IME) 
costs. One commenter stated that the 
IME adjustment has never been used 
before as rationale for decreasing the 
relative weight of DRGs. The commenter 
also stated that the IME adjustment 
should be established to cover those 
particular costs and questioned how 
much of this payment should be 
considered as added payment for 
providing liver transplants to Medicare 
patients. The commenter does not 
believe that this policy is consistent 
with the establishment of other 
transplant procedures that have been 
approved by Medicare. The other 
commenter believes that the assertion 
that transplant facilities will probably 
receive IME and disproportionate share 
payments that will significantly Increase 
the actual payments for covered liver 
transplants is inappropriate and ioo 
highly individualized for each hospital. 
This commenter stated that the relative 
weights of DRGs should be calculated 
based on the average resources required 
to treat the patient and that additional 
payments received by the hospital are 
irrelevant in determining the appropriate 
DRG weight 

Response: It appears that our 
discussion of the proposed weight of 
13.8965 for DRG 480 has caused some 
confusion. It was never our intention to 
reduce the weight of this DRG. The 
proposed weight was based on more 
current data than the data that were 
used to estimate the weight in the earlier 
notice. Recognizing that this 
discrepancy in the weights would cause 
concern, we pointed out that the final 
payment to a hospital for a given case is 
not based solely on the DRG weight 

The statement that facilities 
performing liver transplants tend to be 
larger teaching hospitals that receive 
IME and. in most cases, 
disproportionate share payment 
adjustments that will significantly 
increase the actual payments for 
covered liver transplants, was not 
intended to serve as rationale for a 
lower DRG weight, but to point out that 
in most cases the Medicare payment for 
liver transplant cases will be greater 
than that indicated by the DRG weight. 
The additional Medicare payments for 
IME and disproportionate share do not 
affect the DRG weights but are removed 
when the charges are standardized 
before the DRG weights are 
recalibrated. The weight for the liver 
transplant DRG is calculated using the 
same methodology as the other DRGs. 








Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 36013 


Comment One commenter pointed out 
that liver transplants are much more 
complex and resource intensive than 
other organ transplants such as the 
heart transplant. According to this 
commenter, the liver transplant requires 
12 hours of surgery, 5 surgeons, 8 nurses, 
2 anesthetists, and 2 certified registered 
nurse anesthetists. The heart transplant 
requires 4 to 5 hours of surgery, 3 
surgeons, 3 nurses, 2 anesthetists, and 1 
certified registered nurse anesthetist. 

The commenter is concerned that the 
proposed DRG weight of 13.8965 does 
not take into account the additional staff 
requirements and technical expertise. 

Response: Medicare payment for the 
surgeons, anesthetists, and certified 
registered nurse anesthetists is not 
included in the DRG payment; thus, 
these charges are not included in the 
DRG weight determination. These 
services are paid separately under 
Medicare Part B. The DRG weight is 
calculated using the total charges on the 
bill for the hospital services payable 
under Part A. To the extent inpatient 
stays involving a liver transplant require 
more intensive hospital resources (and 
result in higher charges), this will be 
reflected in the DRG weight. In this 
regard, we note that the final weight for 
DRG 480 is 15.2645 compared to the 
weight of 12.9086 for DRG 103, Heart 
Transplant. 

b. Bone marrow transplants . In the 
September 1.1989 final rule, we 
responded to a comment that requested 
that we establish a unique DRG for 
autologous bone marrow transplants. 

We stated that since we had not 
included such a proposal in the May 8, 
1989 proposed rule, and coverage for 
autologous bone marrow transplants 
had begun only on April 28,1989, we 
would defer making such a change but 
that we would analyze the data that 
became available in the following year. 
We analyzed the data available in the 
FY 1989 MEDPAR file on bone marrow 
transplants. The data show that these 
cases are much more resource intensive 
than the other cases in the DRGs to 
which they are currently being assigned 
and that our data base now includes a 
sufficient number of these cases to 
support the addition of a DRG. 

Therefore, we proposed to add DRG 
481 (Bone Marrow Transplant). We 
proposed to assign both allogeneic and 
autologous bone marrow transplants to 
this DRG. Bone marrow transplants had 
been assigned to four DRGs depending 
on the patient’s principal diagnosis: 

DRG 394 (Other OR Procedures of the 
Blood and Blood Forming Organs), DRG 
400 (Lymphoma and Leukemia with 
Major OR Procedure), and DRGs 406 


and 407 (Myeloproliferative Disorder or 
Poorly Differentiated Neoplasms with 
Major OR Procedure). 

We proposed that only those cases 
with a condition covered by Medicare 
for bone marrow transplantation would 
be paid under DRG 481. We stated that 
we would add a screen for these cases 
to the MCE. Each bone marrow 
transplant discharge would be identified 
by the screen and further reviewed by 
the intermediary before payment is 
made to ensure that all the coverage 
conditions are met 

Allogeneic bone marrow 
transplantation is a procedure in which 
a portion of a healthy donor’s bone 
marrow is obtained and prepared for 
intravenous infusion to restore normal 
marrow function in recipients having an 
inherited or acquired marrow deficiency 
or defect The use of allogeneic bone 
marrow transplantation can be covered 
under Medicare for the following 
conditions: 

• Leukemia. 

• Aplastic anemia. 

• Severe combined immunodeficiency 
disease (SCID). 

• Wiskott-Aldrich syndrome. 

Autologous bone marrow 
transplantation is a technique for 
restoring bone marrow stem cells using 
the patient’s own previously stored 
marrow. Autologous bone marrow 
transplantation can be covered under 
Medicare for patients with the following 
conditions: 

• Acute leukemia in remission for 
patients who have a high probability of 
relapse and who have no HLA-matched 
donor. 

• Resistant non-Hodgkin’s 
lymphomas or those presenting with 
poor prognostic features following an 
initial response. 

• Recurrent or refractory 
neuroblastoma. 

• Advanced Hodgkin’s disease for 
patient’s who have failed to respond to 
conventional therapy and have no HLA- 
matched donor. 

We proposed to assign discharges to 
DRG 481 as follows: 

• Procedure code 41.01 (Autologous 
bone marrow transplant) is performed 
and any one of the following is either a 
principal or secondary diagnosis: 

—Acute leukemia, in remission (V10.60. 

V10.61, V10.62, V10.63, and V10.69). 

—Advanced Hodgkin's disease (201.00- 

201.08, 201.10-201.18, 201.20-201.23, 201.40- 

201.48, 201.50-201.58. 201.60-201.68, 201.70- 

201.78. 201.90-201.98). 

—Resistant non-Hodgkin’s lymphomas 

(202.80-202.88). 

—Recurrent or refractory neuroblastoma 

(140.0-199.1). 


• Either procedure code 41.02 
(Allogeneic bone marrow transplant 
with purging) or 41.03 (Allogeneic bone 
marrow transplant without purging) is 
performed and any one of the following 
is either a principal or secondary 
diagnosis: 

—Lymphoid leukemia (204.0-204.0). 

—Myeloid leukemia (205.0-205.9). 

—Monocytic leukemia (206.0-206.9) 

—Other specified leukemia (207.0-207.8). 

—Leukemia of unspecified cell type (208.0- 

208.9). 

-Wiskott-Aldrich syndrome (279.12). 

—Severe combined immunodeficiency 

disease (279.2). 

—Aplastic anemia (284.0-284.9). 

—Leukemia. In remission (V10.60-V 10.69). 

• In the proposed rule we stated that 
if procedure code 41.00 (Bone marrow 
transplant, not otherwise specified) is 
reported with one of any of the 
diagnoses set forth in the two preceding 
paragraphs, the case would be 
developed further and would be 
assigned to DRG 481 only after 
verification that a covered transplant 
was performed. 

Unlike the other transplant DRGs 
(that is. kidney, heart, and liver), for 
which the cost of the organ acquisition 
is paid on a reasonable cost basi9. the 
payment for the acquisition costs for 
bone marrow transplants is included in 
the DRG payment. Therefore, in 
calculating the DRG weight for bone 
marrow transplants under the 
methodology set forth below in section 
III.C of this preamble, bone marrow 
acquisition charges were not subtracted 
from the total charges prior to 
computing the average charge for the 
DRG and. subsequently, its relative 
weight. 

Comment One commenter asked for 
clarification of the statement in the 
proposed rule that, prior to the payment 
of a claim containing a bone marrow 
transplant code, a case will be ’’further 
reviewed by the intermediary.” The 
commenter was interested in the criteria 
that will be used by the fiscal 
intermediary to allow or disallow 
payment and whether or not the 
intermediary will need the medical 
record to conduct its review. The 
commenter also requested information 
on the time lag hospitals can expect 
between billing, FI review, and payment. 

Response: The ’’further review by the 
intermediary” refers to the verification 
process by which the intermediary will 
check the diagnosis codes on the bill of 
each bone marrow transplant case 
against the Medicare coverage criteria 
listed in the Medicare Coverage Issues 
Manual and described above in this 
section of the preamble. Those cases 








36014 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rule 9 and Regulations 


with at least one of the diagnosis code 9 
of a condition that Medicare will cover 
coupled with the correct bone marrow 
transplant procedure code will be 
processed through the GROUPER 
assigned to the bone marrow transplant 
DRG, and paid as such. This review will 
be done through an automated interface 
on the MCE and will not increase the 
time required to process these bone 
marrow transplant bills. However, if 
procedure code 41.00 (Bone marrow 
transplant, NOS) is coded with one of 
the covered diagnoses, the bill will be 
returned to the hospital for a more 
specific procedure code. Since different 
conditions are covered for autologous 
and allogeneic bone marrow 
transplants, the bill must be coded 
specifically as either allogeneic or 
autologous to be paid as DRG 481. The 
FI will not review the medical records of 
the bone marrow transplant cases prior 
to payment. However, the PRO may 
review cases assigned to and paid under 
DRG 481, Bone Marrow Transplant, on a 
postpayment review basis. In this case, 
the medical records for the bone marrow 
transplant will be reviewed. 

Comment: One commenter pointed out 
that the proposed rule stated that 
Medicare will pay for bone marrow 
transplants done to treat aplastic 
anemia; however, the codes that include 
this diagnosis were not listed (55 FR 
19430). 

Response: Although aplastic anemia 
was mentioned in the proposed rule as a 
covered condition (55 FR 19430), the 
ICD-9-CM codes for aplastic anemia 
(284.0-284.9) were inadvertently left off 
the list of covered codes printed in the 
proposed rule. These codes will be 
included as covered diagnoses. 

Comment: Two commenters objected 
to the Medicare coverage guidelines for 
autologous bone marrow transplants 
that lists codes V10.60 through V10.69 as 
the ICD-9-CM diagnosis codes for acute 
leukemia in remission. They stated that 
these codes do not indicate leukemia in 
remission. They pointed out that, 
according to current coding guidelines, 
the VlO series of codes are used to 
indicate the site of a previous cancer 
that has been excised or eradicated and 
no longer exists. They also pointed out 
that leukemia in remission is still an 
existing cancer and that there are no 
ICD-9-CM codes that specifically 
indicate leukemia in remission. They 
recommended that HCFA ask the ICD- 
9-CM Coordination and Maintenance 
Committee to revise the leukemia codes 
to designate specific codes for leukemia 
in remission. They also suggested that, 
in the meantime, the leukemia code 
series (diagnoses 204 tiirough 208) be 


used instead of the VlO codes to identify 
acute leukemia and that the leukemia in 
remission be identified by a chart 
review, since HCFA already plans to 
screen each bone marrow transplant 
case to ensure that all coverage 
conditions are met. 

Response: The ICD-9-CM alphabetic 
index instructs coders to use the V10.6 
series for leukemia in remission. The 
ICD-9-CM. Coordination and 
Maintenance Committee is currently 
proposed to create diagnosis codes for 
leukemia in remission. The earliest date 
that approved changes would become 
effective is October 1,1991. In the 
interim, the Medicare coverage 
requirements will remain the same, and 
coding guidelines will be published in 
the Coding Clinic for ICD-9-CM (Fourth 
quarter, 1990) to instruct hospitals to 
make an exception to coding advice 
published previously in the Coding 
Clinic for ICD-9-CM (May-June, 1985), 
which indicated that the VlO series not 
be used to indicate a cancer remission. 
The revised guidelines will instruct that 
the V10.6X codes (Personal history of 
leukemia in remission) are to be used 
when a patient is admitted with 
leukemia in remission for an autologous 
bone marrow transplant. We note that 
the intermediaries will screen each bone 
marrow transplant case for a diagnosis 
code of a covered condition but that this 
screen will not include a review of the 
medical record. 

Comment: Two commenters disagreed 
with the payment methodology for bone 
marrow acquisition charges. One 
disagreed with the proposal to include 
organ recovery costs in the bone 
marrow transplant DRG payment and 
recommended that they be treated in a 
manner consistent with other transplant 
procedures (that is. paid as a pass¬ 
through on a reasonable cost basis). The 
other commenter urged us to reconsider 
this policy and pay allogeneic bone 
marrow acquisition costs as a pass¬ 
through, on a reasonable cost basis, as 
is done with kidney, heart, and liver 
acquisition costs. 

Response: Under the prospective 
payment system, payment for bone 
marrow acquisition costs are and have 
always been included in the DRG 
payment for the bone marrow 
transplant. There are differences in both 
the acquisition and payment of bone 
marrow and organs such as the kidney, 
heart, and liver. With kidney, heart, and 
liver transplants, the donor and 
recipient may often be in different 
hospitals, and the procuring, 
preservation, and transportation of 
donated organs is coordinated through 
an organ procurement agency. The 


Medicare payment for the acquisition of 
these organs is made on a pass-through 
basis, generally to the hospital that did 
the procuring. With an allogeneic bone 
marrow transplant, the donor and 
recipient are usually in the same 
hospital. In the case of an autologous 
bone marrow transplant, the patient is 
both the bone marrow donor and 
recipient. The charges for bone marrow 
acquisition in both allogeneic and 
autologous bone marrow transplant 
cases are included on the recipient’s 
Medicare bill, and the payment is 
included in the DRG payment for the 
recipient’s bone marrow transplant. 

Comment: Two commenters. while 
supporting the creation of a separate 
DRG for bone marrow transplants, are 
concerned with the adequacy and 
appropriateness of the DRG weight. One 
commenter is especially concerned with 
the small case volume (45 cases in the 
proposed rule) used to set the proposed 
DRG weight and their high variability in 
resource use and length of stay. One 
commenter stated that a review of the 
cost data at the commenter’s hospital 
shows the proposed DRG weight to be 
"underweighted" by at least 50 percent. 
One commenter was not convinced that 
the DRG is sufficiently well-defined for 
case level prospective payment and also 
inquired if HCFA had evaluated 
whether separate DRGs are indicated 
for patients of different ages, allogeneic 
versus autologous bone marrow 
transplant patients, or multiple 
transplant patients. This commenter 
also reported that for pediatric patients 
receiving bone marrow transplants, 
those with a principal diagnosis in 
MDGs 10 and 16 have higher and more 
variable resource use on average than 
those pediatric patients with a principal 
diagnosis in MDC 17. These commenters 
recommended that HCFA develop a 
broader analysis of costs and charges 
associated with bone marrow transplant 
procedures than suggested in the 
proposed rule and that the 
appropriateness of the DRG weight be 
monitored so that revisions be made 
upon review of more current "actual" 
data as Medicare claims are processed. 

Response: The proposed bone marrow 
transplant DRG weight of 11.9901 was 
based on FY 1989 MEDPAR data for 45 
bone marrow transplant cases that met 
Medicare’s criteria for coverage. The 
proposed DRG weight was among the 
highest of the DRG weights. As noted 
above for liver transplants, the Medicare 
DRG payment does not include capital, 
organ acquisition, or other pass-through 
costs, or physician and other part B 
services. Therefore, an accurate 
comparison cannot be made between a 













Federal Register / Vol. 55. No. 171 / Tuesday. September 4. 1990 / Rules and Regulations 3S015 


hospital's cost per bone marrow 
transplant case and the DRG payment in 
order to determine the amount that the 
payment exceeded or fell short of the 
cost of treating that case. 

The methodology to recalibrate the 
DRG weights (see section III.C of this 
preamble) requires a minimum of 10 
cases to compute a reasonable DRG 
weight. Since the FY 1989 MEDPAR data 
used to set the final weights include 5} 
bone marrow transplant cases that meet 
the Medicare criteria for coverage, these 
cases were used to determine the bone 
marrow transplant DRG weight in a 
manner consistent with the other DRG 
weights. The final weight for DRG 481 is 
12.4485. 

We believe that the bone marrow 
transplant DRG is both appropriate and 
well-defined for case level prospective 
payment. DRG 481 (Bone Marrow 
Transplant) is well-defined clinically by 
the transplant procedure which is 
unique from other surgical procedures. 
Also, the amount of resources used for 
bone marrow transplants differentiates 
them from other types of cases in other 
DRGs. We do not feel that is appropriate 
at this time to split the bone marrow 
transplant DRG by type of bone marrow 
transplant or by patient age, or to create 
a separate DRG for multiple transplant 
patients. The bone marrow transplant 
cases in the MEDPAR file are fairly 
homogeneous both clinically and based 
on resource use. We will continue to 
evaluate the bone marrow transplant 
cases as part of our ongoing refinement 
to enhance clinical coherency and 
reduce variation in charges within each 
DRG. 

c. Tracheostomy 

Beginning with discharges occurring 
on or after October 1,1987, cases with a 
principal diagnosis in MDC 4 (Diseases 
and Disorders of the Respiratory 
System) and one of the tracheostomy 
procedure codes 31.1 (Temporary 
tracheostomy). 31.21 (Mediastinal 
tracheostomy), or 31.29 (Other 
permanent tracheostomy) were assigned 
to a new DRG 474 (Respiratory System 
Diagnosis with Tracheostomy). We also 
created a new DRG 475 (Respiratory 
System Diagnosis with Ventilator 
Support). Currently, cases group to DRG 
475 when a patient with a principal 
diagnosis in MDC 4 receives mechanical 
ventilation (procedure code 93.92) and 
no operating room procedure or 
tracheostomy is performed during the 
hospital stay. 

We received many requests that we 
expand DRGs 474 and 475 to include 
patients with other than respiratory 
diagnoses. Our analysis of the FY 1988 
and F 1989 MEDPAR data 


demonstrated that tracheostomy cases 
in the other MDCs have significant 
differences in resource consumption, 
with consistently higher average charges 
than other cases in the same DRG. 
Additionally, the charges for these 
tracheostomy cases, with the exception 
of certain cases with a mouth, larynx, or 
pharynx disorder, were more similar to 
each other than to the other cases in the 
MDCs to which they are currently 
assigned. Tracheostomy patients with a 
mouth, larynx, or pharynx disorder 
incurred significantly lower charges 
than other tracheostomy patients; 
however, their charges were still higher 
than those of other cases in the same 
DRG. Cases with a principal diagnosis 
of a mouth, larynx, or pharynx disorder 
are more likely to require a 
tracheostomy as a therapeutic measure 
related to the principal diagnosis rather 
than in response to respiratory failure 
requiring long-term ventilation. 

We proposed to create two 
tracheostomy DRGs: DRG 482 for 
patients with a disorder of the mouth, 
larynx, or pharynx who have one of the 
tracheostomy procedures performed 
(procedure codes 31.1, 31.21, or 31.29), 
and DRG 483 for all other patients with 
at least one of the tracheostomy 
procedure codes. We proposed to delete 
DRG 474 since all cases that currently 
group to DRG 474 would now be 
assigned to DRG 483. 

We proposed to assign tracheostomy 
patients to DRG 482 or 483 prior to other 
DRG and MDC assignment but after 
patients have been classified to the 
Liver or Bone Marrow Transplant DRGs 
480 or 481. We proposed to group cases 
to the tracheostomy DRGs before the 
new DRGs for HIV infection or multiple 
significant trauma because, for the 
Medicare population, tracheostomy 
patients tend to incur higher charges 
than either HIV or trauma patients. 

The response to our proposed 
tracheostomy DRGs was 
overwhelmingly favorable. However, 
some commenters wrote to suggest 
various revisions to these DRGs. 

Comment: ProPAC is concerned about 
the incentives to code tracheostomy 
procedures and whether these 
additional cases will be similar to the 
cases upon which we based the weights 
for DRGs 482 and 483. ProPAC further 
commented that the subset of 
tracheostomy cases classified in MDC 4 
indicate wide variation in length of stay 
and charges among cases. Also, many of 
these patients die in the hospital. The 
Commission findings suggest that further 
analysis to identify subgroups of 
tracheostomy cases may be warranted. 
Another commenter suggested that we 
conduct more research toward 


introducing further subdivision of the 
tracheostomy cases, at least for certain 
MDCs (as in the Yale model) or for 
surgical versus medical cases. 

Response: We share ProPAC's 
concern that the volume of cases with 
tracheostomy procedures reported on 
the bill may increase. Heretofore, since 
payment was unaffected, hospitals had 
no financial incentive to report 
tracheostomies that were performed 
appropriately on patients with other 
than respiratory conditions (that is, 
those patients outside NDC 4). With the 
establishment of the higher-weighted 
DRGs for tracheostomy cases, hospitals 
will now have an incentive to report 
tracheostomies outside MDC 4. As 
ProPAC pointed out, we experienced a 
40 percent increase in the reporting of 
tracheostomy cases in MDC 4 when a 
separate DRG was created for 
tracheostomy cases in MDC 4 (DRG 474) 
in FY 1988. However, we have no basis 
for assuming that any increased volume 
of reported tracheostomies under the 
new DRGs would be for patients with 
different resource requirements than 
those in the data base used to establish 
the new DRGs. 

We plan to evaluate the impact and 
performance of the tracheostomy DRGs 
when FY 1991 Medicare discharge data 
become available. If these DRGs show 
increases in heterogeneity, that is. 
dissimilar cases with high charge 
variance, consideration will be given to 
appropriate modification of the 
tracheostomy DRGs. 

We evaluated creating separate 
tracheostomy DRCs for surgical and 
medical cases as one component of our 
analysis prior to proposing the mouth, 
larynx, or pharynx disorder with 
tracheostomy and all other conditions 
with tracheostomy groups. While in 
most MDCs, surgical cases with a 
tracheostomy showed higher charges 
than the medical cases with a 
tracheostomy, we concluded that this 
division would not significantly reduce 
the amount of variation in resource use 
within the tracheostomy DRGs. 
Therefore, the decision was made to 
propose DRGs based on all MDCs, with 
separate DRGs for mouth, larynx, or 
pharynx disorders and for all other 
patients. These two groups 
demonstrated the most substantial 
differences from each other. 

Comment: One commenter brought to 
our attention two procedure codes that 
were not included in the list of 
tracheostomy procedure codes that 
would assign cases to DRG 482 or 483. 
These two codes are procedure codes 
30.3 (Complete laryngectomy)—and 30.4 
(Radical laryngectomy). A laryngectomy 









36016 Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Rules and Regulations 


is the removal of the voice box. Because 
a tracheostomy is virtually always 
performed as part of the procedure, 
coders are directed by the ICD-9-CM, 
volume 3, not to report the tracheostomy 
codes when codes 30.3 and 30.4 are 
reported. The commenter recommended 
that the procedure codes that group to 
the tracheostomy DRGs be expanded to 
include 30.3 and 30.4 so that discharges 
involving either of these procedures 
would also be assigned to DRG 482 
(Tracheostomy with Mouth, Larynx, or 
Pharynx Disorder). 

Response : Currently, discharges with 
procedure codes 30.3 and 30.4 are 
assigned to DRG 49 (Major Head and 
Neck Procedure) and DRGs 70 and 77 
(Other Respiratory System Procedures). 
In the process of expanding the 
tracheostomy procedures from DRG 474, 
we overlooked the two laryngectomy 
(with tracheostomy) procedures. Our 
medical consultants verified that these 
two procedures do, in fact, include 
tracheostomy. Evaluation of MEDPAR 
data confirms that these cases have a 
distribution of charges similar to DRG 
482. Based on this finding, as well as the 
current classification of cases with these 
procedures primarily to DRG 49, we are 
providing that procedure codes 30.3 and 

30.4, when performed with any 
diagnosis, will group to DRG 482. 
Therefore, the GROUPER will assign all 
cases to DRG 482 with a principal 
diagnosis of mouth, larynx, or pharynx 
disorder and procedure codes 31.1, 31.21, 
or 31.29; or cases with any principal 
diagnosis and procedure codes 30.3 or 

30.4. Cases with other principal 
diagnoses and procedure codes 31.1, 
31.21, 31.29 will group to DRG 483. For 
the convenience of the reader, we have 
listed in table 6k of the Addendum to 
this final rule all the mouth, larynx, and 
pharynx disorder diagnosis codes that 
will cause a tracheostomy case to be 
assigned to DRG 482. 

Comment: Two commenters observed 
that a problem may exist for 
tracheostomy patients who are 
transferred during the course of 
treatment. These commenters present a 
hypothetical case of a trauma victim 
who receives a tracheostomy upon 
admission, is stablized, and then 
transferred to a tertiary care center 
where the patient could remain for 2 
months or longer, with a significant 
portion of that time on mechanical 
ventilation. The commenters complain 
that once the patient is transferred, the 
discharge cannot be classified in a 
tracheostomy DRG. 

Response: The secenario described by 
the commenter raises several issues. 
First, our policy is to consider only the 


procedures actually performed at the 
hospital in assigning cases to their 
respective DRGs. This is a fundamental 
principle of the DRG classification 
system that allows us to classify 
patients based on information that is 
presented on the bill. Any deviation 
from this principle, such as to recognize 
a tracheostomy that was performed 
elsewhere prior to admission, would not 
be appropriate and would be impractical 
to administer since it would require 
associating bills from different inpatient 
stays. 

Secondly, effective with discharges 
occurring in FY1990, we modified DRG 
475 so that transfer cases with a prior 
tracheostomy would be assigned to this 
DRG if certain conditions were met. 
(Prior to FY 1990, such cases could not 
be assigned to DRG 475 because both 
intubation and mechanical ventilation 
were required for assignment and the 
intubation was usually performed 
elsewhere prior to the patient’s transfer.) 
The new tracheostomy DRGs will not 
affect the assignment of these cases. 

A patient who receives a 
tracheostomy in one facility and is then 
transferred to another will be treated in 
the same manner as under the current 
system. Specifically, the stay in a 
second hospital will not be assigned to a 
tracheostomy DRG since the procedure 
was not performed at the second 
hospital and cannot be coded on the 
hospital’s bill. When a patient with an 
established tracheostomy is transferred, 
the second hospital is paid under DRG 
475 only if the principal diagnosis is 
classified in MDC 4. the patient receives 
mechanical ventilation, and no 
operating room procedures were 
performed during the stay in the second 
hospital. 

Although our current payment policy 
on transfer cases that had a 
tracheostomy performed prior to 
admission is an improvement over the 
policy in effect before FY 1990, we 
recognize that payment may still be 
inadequate for cases that do not meet 
the conditions for assignment to DRG 
475 and for those cases that involve 
prolonged mechanical ventilation. As 
indicated below in response to other 
commenters, we are continuing to 
review these situations in an effort to 
improve our payment policies for 
ventilator patients who consume more 
than average resources. 

Comment: Several commenters 
expressed regret that although we were 
improving payment for tracheostomy 
cases, we failed to expand other 
mechanical ventilation cases beyond 
MDC 4 and DRG 475. These commenters 
encouraged us to institute a policy for 


mechanical ventilation similar to the 
proposed classification for tracheostomy 
cases, addressing the unresolved issue 
of medical patients placed on 
mechanical ventilation who do not have 
a tracheostomy and who do not have a 
principal diagnosis in MDC 4. It was 
recommended that we give priority to 
completing research on possible 
additional mechanical ventilation 
categories for cases outside MDC 4. 

Response: As stated in the proposed 
rule, cases with MDC 4 principal 
diagnoses and mechanical ventilation 
currently classify to DRG 475 if no 
surgical procedure or tracheostomy is 
performed. As stated at that time, we 
are continuing to analyze resource 
consumption for nontracheostomy, 
ventilator-assisted patients in medical 
DRGs outside MDC 4. We did not 
propose any changes for mechanical 
ventilation as our analysis was not 
complete. We are continuing the 
analytic work on these cases to 
determine if it is appropriate to develop 
DRGs similar to those proposed for 
tracheostomy cases. 

Comment: Other commenters 
expressed concern about the time spent 
on ventilation as a distinguishing factor 
in resource consumption. One 
commenter recommended that the basis 
for DRG assignment be the presence of 
both a diagnosis of severe respiratory 
compromise (diagnosis codes 518.81. 
518.82, 799.0, and 799.1) and mechanical 
ventilation (procedure code 93.92). The 
commenter states that this would 
capture patients who are experiencing a 
severe, life-threatening respiratory 
disorder and are also being 
mechanically ventilated. This would 
preclude the need to identify the time a 
patient was mechanically ventilated. 

Response: We gave considerable 
thought to the recommendation to use 
time on mechanical ventilation as a 
proxy for resource consumption, and to 
use length of time to distinguish routine 
surgical mechanical assistance from the 
more extensive care associated with 
prolonged ventilation. As stated in the 
proposed rule, we have no way to 
identify the length of time spent on 
mechanical ventilation. Over the past 
year, the ICD-9-CM Coordination and 
Maintenance Committee reviewed 
whether it would be appropriate to 
change the ventilator procedure codes to 
reflect the length of ventilator time. A 
number of approaches were suggested. 
The committee decided against making 
any changes effective October 1,1990 
due to lack of empirical evidence 
supporting appropriate time intervals. 

We are continuing to consider and 
research this issue of mechanical 





Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 3G017 


ventilation time in an effort to address 
the concerns of hospitals that ventilator- 
assisted patients consume above 
average resources. 

We have analyzed data using 
respiratory failure diagnosis codes 
518.81, 518.82, 799.0, and 799.1 and 
mechanical ventilation code 93.92. 

While this distinction served to identify 
a class of patients within MDC 4, 
respiratory failure was not coded with 
enough consistency in other MDCs to be 
reliable. However, we appreciate the 
suggestion and will examine thi3 
possibility as one component of our 
continuing analysis. 

d Multiple Significant Trauma. The 
DRG classification system has received 
considerable criticism because there are 
no DRGs designed for multiple trauma 
cases. There is an MDC for injuries, 
poisoning, and toxic effects of drugs 
(MDC 21) that contains several surgical 
DRGs for injuries and three medical 
DRGs for multiple trauma. However, 
most injury and trauma cases group to 
one of the other MDCs based on the 
body system affected by the principal 
diagnosis. Multiple trauma cases tend to 
be extremely resource intensive and to 
incur long lengths of stay. Because these 
cases are assigned to DRGs based on 
principal diagnosis, they are included in 
DRGs with other generally less 
expensive cases and, thus, tend to 
receive Medicare payments that are far 
less than the cost of treating the case. 

We proposed to create a new MDC 24 
(Multiple Significant Trauma) with three 
surgical DRGs (DRG 484 through 486) 
and one medical DRG (DRG 487) to 
classify multiple significant trauma 
cases. We proposed to assign these 
cases to DRGs 404 through 487 after 
assignment of cases to bone marrow 
and liver transplant and tracheostomy 
DRGs and before cases are assigned to 
the current MDCs. Patients with a 
principal diagnosis of trauma (diagnosis 
codes 800.00-904.9; 910.0-929 9, and 
950.0-959.9) group to a multiple trauma 
MDC if at least two significant trauma 
diagnosis codes from two different body 
site categories are reported as either 
principal or secondary' diagnoses. We 
pioposed to recognize eight different 
body site categories; head, chest, 
abdomen, kidney, urinary, pelvis and 
spine, upper limb, and lower limb. 

Based on HCFA data analysis, the 
following DRG groupings were proposed 
for multiple significant trauma: 

DRG 484 Craniotomy for Multiple 
Significant Tauma 
DRG 485 Hip. Femur and Limb 
Reattachment Procedures for Multiple 
Significant Trauma 

DRG 480 Other OR Precedures for Multiple 
Significant Trauma 


DRG 487 Other Multiple Significant Trauma 

As proposed, the OR procedures 
allowed for MDC 24 would be all of the 
OR procedures allowed for MDC 21 plus 
OR procedure codes 01.21, 01.42, 01.51, 
01.6, and 02.14. If an OR procedure other 
than one of these is performed, the case 
will be assigned to DRG 468 (Extensive 
OR Procedure Unrelated to Principal 
Diagnosis), DRG 476 (Prostatic OR 
Procedure Unrelated to Principal 
Diagnosis), or DRG 477 (Non-Extensive 
OR Procedure Unrelated to Principal 
Diagnosis). We proposed that multiple 
significant trauma cases with no OR 
procedure would group to DRG 487. 

For purposes of clarity and to lessen 
confusion concerning the DRGs to which 
multiple trauma cases group, we 
proposed to revise the titles of the 
current DRGs 444, 445, and 446 (Multiple 
Trauma) in MDC 21 to Traumatic Injury. 

We received many comments 
supporting and approving our proposed 
multiple significant trauma DRGs. All of 
the comments received regarding 
multiple significant trauma included a 
favorable statement. We did, however, 
receive several suggestions on ways to 
improve these DRGs. 

Comment: Commenters recommended 
that we consider creating a new DRG to 
describe multiple injuries within one 
anatomic area. These commenters 
observed that multiple injuries occur 
both within a single body area as well 
as in two or more body sites, and that 
these patients consume more resources 
than those with single organ injuries 
within the same anatomic area. As the 
proposed DRGs do not address multiple 
organ injury within one body system, an 
additional DRG indicating multiple 
significant injuries within one body site 
was recommended. 

Response: Patients group to MDC 24 
with a principal diagnosis of trauma 
(diagnosis codes 800.00-904.9, 910.0- 
929.9, and 950.0-959.9) and at least two 
significant trauma diagnosis codes 
(either as principal or secondary) from 
different body site categories. The eight 
different body site categories and 
diagnosis codes associated with each 
category are set forth in Table 6h of the 
addendum to this final rule. 
Operationally, this classification groups 
patients to MDC 24 if they have a 
principal diagnosis of significant trauma 
from one body site and a secondary 
significant trauma from another body 
site or a principal diagnosis of trauma 
that i9 not on one of the body site 
significant trauma lists and two 
secondary diagnoses of significant 
trauma from different body sites. 

HCFA data analysis for these multiple 
trauma cases substantiated the New 


York study results: These cases did in 
fact consume more resources than other 
cases in the DRGs to which they group 
under current classification. Variation 
was reduced, as measured by the 
coefficient of variation (the standard 
deviation divided by the mean), thus 
increasing homogeneity. The creation of 
these DRG9 reduces the variance both in 
the new DRGs and in the DRGs from 
which these cases were drawn. To date, 
the Medicare data have not supported 
the development of similar DRGs for 
multiple trauma to a single body site. 

The reduction in variability in the cases 
remaining in the original DRGs to which 
trauma cases have been previously 
grouped was significant enough to be 
considered sufficient improvement at 
this time. 

We will be evaluating the 
performance of the multiple trauma 
DRGs. As one component of this 
analysis, we will examine the relative 
resources required for multiple trauma 
to a single body site. 

Comment: Two comments were 
received concerning emergency room 
care and trauma payment. Both 
observed that trauma diagnoses and 
treatment are often buried in nontrauma 
DRGs where the emergency care 
component of trauma resource 
consumption is poorly recognized. These 
commenters indicated the emergency 
room component of trauma resource 
consumption merited recognition. 

Response: DRG weights are calibrated 
based on charges submitted on 
Medicare claims. If a beneficiary 
receives emergency room services and is 
subsequently admitted as an inpatient 
before midnight of the following day. the 
emergency room services are covered 
under part A and the charges are 
included on the inpatient bill. To the 
extent that emergency room charges are 
entered on the inpatient bill, they are 
part of total charges and included in 
establishing the weight for the relevant 
DRGs. Given the traumatic nature of the 
cases that will be assigned to MDC 24, 
we would anticipate that most, if not all 
would be emergency admissions. 

Comment: We received several 
comments with recommendations that 
related to specific proposed DRGs for 
multiple trauma. One commenter 
observed that the New York State 
multiple significant trauma DRGs have 
two medical DRGs as compared to the 
one medical DRG being proposed for 
Medicare. 

Response: When we analyzed 
Medicare data using the New York 
model, we found that the two New Yoik 
medical DRGs for Head. Chest and 
Lower Limb Diagnoses of Multiple 








36018 Federal Register / Vol. 55, No. 171 / Tuesday, September 4. 1990 / Rules and Regulations 


Significant Trauma and Other Diagnoses 
of Multiple Significant Trauma were 
similar in terms of length of stay and 
charges for the Medicare population. 
Clinically, there was no reason to 
maintain separate groups. Therefore, the 
decision was made to form only one 
medical DRG, DRG 487 (Other Multiple 
Significant Trauma). 

Another difference between the 
HCFA Multiple Significant Trauma 
DRGs and the New York model is in the 
sequencing for patients with multiple 
significant trauma that require a 
tracheostomy. The New York Grouper 
assigns these cases to the Multiple 
Significant Trauma DRGs. Under the 
Medicare GROUPER, these cases will be 
assigned to the Tracheostomy DRGs 482 
and 483 rather than the Multiple 
Significant Trauma DRGs. The net effect 
of this difference is to reduce the range 
of variance in the charges and length of 
stay in the Medicare Significant Multiple 
Trauma cases, since the typical 
tracheostomy case requires greater 
resources than the typical multiple 
trauma case. 

Comment: HCFA should broaden DRG 

484 (Craniotomy for Multiple Significant 
Trauma) to include “Multiple Significant 
Trauma with Significant Head Injury, 
with or without Craniotomy.” as only a 
fraction of multiple-injured patients with 
head injuries undergo a craniotomy. 

Response : We will be cognizant of the 
classification concerns expressed by the 
commenter as we evaluate the 
performance of the multiple significant 
trauma DRGs. For FY 1991, head injury 
cases without craniotomy will group to 
DRG 488 (Other OR Procedures for 
Multiple Significant Trauma), or to DRG 
487 (Other Multiple Significant Trauma) 
if no defined multiple trauma procedure 
is performed. If future data analysis 
reveals that these cases have charges 
and lengths of stay that more nearly 
pattern those of cases in DRG 484 
(Craniotomy for Multiple Significant 
Trauma) than the cases in the DRGs to 
which they are assigned, we will 
consider this recommendations. Initial 
analysis prior to proposing the new 
DRGs indicated that the New York 
model served to improve homogeneity 
for multiple trauma cases. The 
performance of these DRGs in the next 2 
years may indicate that further 
modifications are necessary. 

Comment: One commenter suggested 
that DRG 485 (Hip, Femur, and Limb 
Reattachment Procedures for Multiple 
Significant Trauma) should be redefined 
to specify just hip replacement as this is 
the most common procedure and femur 
and limb realtachment procedures are 
rare. Another commenter stated DRG 

485 should be redefined into two 


separate DRGs, “Hip and Femur 
Procedures for Multiple Significant 
Trauma", and “Limb Reattachment 
Procedures for Multiple Significant 
Trauma", limb reattachment procedures 
being rare and hip and femur procedures 
more common in the elderly. 

Response : We are aware that limb 
reattachmen] procedures arc rare. 
However, they resemble most closely 
other diagnoses within DRG 485 (Hip. 
Femur, and Limb Reattachment 
Procedures for Multiple Significant 
Trauma). Of the cases grouping to 
proposed DRG 485, 88 percent are for 
hip and femur except major joint 
procedures. Whenever possible, we 
prefer to group patients that are similar 
clinically and in terms of resource 
consumption, rather than create a 
number of separate DRGs containing 
relatively few cases. Our analysis does 
not support a DRG to include only limb 
reattachment and femur procedures. In 
addition, our analysis indicates that 
these cases are similar in charges and 
length of stay to the hip procedure cases 
that group to DRG 485. 

We do agree, however, that the title of 
DRG 485 lacks clarity. Therefore, we are 
changing the title to “Limb 
Reattachment, Hip and Femur 
Procedures for Multiple Significant 
Trauma." 

Comment: In the interest of clarity, 
one commenter suggested that the title 
of DRG 487 (Other Multiple Significant 
Trauma) be revised to read “Other 
Significant Trauma Not Requiring 
Operation". 

Response: DRGs, insofar as possible, 
are labelled succinctly and clearly. We 
attempt to convey as much information 
in the title as is necessary to understand 
the classification without including all 
the detailed information necessary to 
assign a case to that DRG. Sometimes it 
is necessary to distinguish between 
DRGs by including more detail. This is 
the case with, for example, DRG 51, 
Salivary Gland Procedures except 
Sialoadenectomy. The most common 
distinction between DRGs are age and 
presence of CCs. We do not feel it is 
necessary to define DRG 487 as Other 
Significant Trauma Not Requiring 
Operation since the original title (Other 
Significant Trauma) is adequate to 
describe the basis for what will be 
included in that classification. 

Comment: One commenter believes 
that the diagnoses assigned to the 
various body sites for purposes of the 
multiple trauma DRGs should be 
revised. This commenter maintains a 
data base on multiple trauma cases that 
he has offered to share with us. 

Response: The data we used in 
analyzing the revised DRGs are the FY 


1989 MEDPAR data, which are the most 
recent complete data we have available. 
Hospitals and other interested parties 
collect data for a variety of purposes 
and subjects. HCFA makes use of many 
of these sources in the course of 
evaluation and analysis, and we intend 
to explore other analyses of trauma 
cases as part of our on-going effort to 
improve the DRG classification system. 
However, we note that, for policy 
decision-making, we use internal data 
sources based only on Medicare 
discharges. Thus, we ensure, and 
assume responsibility for, data 
consistency and accuracy and 
appropriateness of the DRGs and 
relative weights for the Medicare 
population. 

Comment: Among the comments 
received regarding Multiple Significant 
Trauma were several references to the 
use of Medicare DRG grouping methods 
by other payers for non-Medicare 
patient populations. Commenters were 
concerned that Medicare DRGs serve as 
models for other payers and populations 
and that IICFA must be cognizant of this 
fact. One commenter recommended that 
we qualify or withdraw our statement 
that the proposed categories are 
“homogeneous" and "would improve 
payments under other insurance 
programs that have adopted the 
Medicare DRG classification system." 

(55 FR 19431.) 

Response: HCFA is well aware that 
its DRG classification system serves as 
a model for other reimbursement groups 
and routinely cautions other payers that 
our DRG weights and groupings are 
based on Medicare patient data and 
may not be appropriate for other classes 
of patients. However, in the case of the 
Multiple Significant Trauma DRGs, 
these were modeled after New York 
Multiple Significant Trauma DRGs, 
which is an all-payer system. Therefore, 
this classification methodology has 
already demonstrated improvements 
under other insurance programs. Using 
MEDPAR data, we measured variance 
within and between the DRGs, both 
prior to mutiple trauma groupings and 
after assigning cases based on the 
proposed DRGs. The classification 
system for multiple significant trauma 
served to reduce variance; therefore, 
establishing the DRGs for Multiple 
Significant Trauma results in more 
homogeneous grouping of Medicare 
patients. 

Comment: One commenter stated that 
the averaging process used to create 
DRG weights poorly serves the bi-modal 
and tri-modal distribution of many 
trauma patient populations, and 








Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 36019 


prejudices those trauma centers that 
treat the most severely injured patients. 

Response : While it is true that the 
averaging system could potentially 
present difficulties for hospitals who 
systematically treat more severely ill 
patients and not an average mix of 
patients, there is no empirical evidence 
to document that this problem is more 
unique to the multiple significant trauma 
DRGs than other DRGs. 

Comment: One commenter raised 
questions regarding the logic and 
consistency of the procedures assigned 
to the three significant multiple trauma 
DRGs 484, 485, and 486. This commenter 
questioned why some craniotomy 
procedures group to DRG 484 and some 
hip, femur, and limb procedures group to 
DRG 485 while other craniotomy 
procedures as well as other hip. limb, 
and femur procedures will be assigned 
to DRG 486. This commenter was 
concerned that DRG 486 consists of 
disparate procedures, resulting in a lack 
of statistical and clinical homogeneity 
within that DRG. 

Response: As noted above, the 
multiple significant trauma DRG 9 
proposed by HCFA are modeled on the 
New York State DRGs; we relied to an 
extent on the data analysis conducted 
by 3M/HIS for New York in forming our 
decision for assigning cases to multiple 
trauma DRGs. The New York 
classification of cases followed the 
guidelines provided by the Condensed 
Abbreviated Injury Scaling (CAIS) chart, 
which has proven valuable for 
prospective clinical injury scoring. Early 
prospective clinical injury scoring is a 
process whereby an objective measure 
of the severity of a patient's injuries 
starts to be formulated soon after 
admission. As more information 
becomes available, a definitive injury 
severity score is calculated. Use of this 
scale permits grouping trauma cases by 
level of severity and by body site. 

The assignment of certain craniotomy 
procedures to DRG 484, while others 
w ent to DRG 486, was determined by 
the similarity of resource intensity and 
clinical severity judged by our medical 
consultants and the CAIS chart 
assignment by level of severity. The high 
cost, service-intense craniotomy 
procedures were assigned to DRG 484, 
w hich has the highest weight of the 
multiple significant trauma DRGs. While 
we agree that the procedures assigned 
to DRG 486 are not anatomically similar, 
they do resemble each other in terms of 
measures of resource consumption and 
ir. levels of severity. This is true, also, 
for the Hip, Femur and Limb 
Reattachment procedures that group to 
either DRG 485 or 486. While most of the 
hip procedures are found in DRG 486. 


this DRG has a higher weight than DRG 
435. The hip procedures assigned to 
DRG 485 were more similar in charges 
and level of severity to the other 
procedures found in that DRG. 

We plan to evaluate the assignment of 
cases to the multiple significant trauma 
DRGs during the coming 2 years. We 
appreciate the comments and questions 
that have been raised in regard to these 
cases and will continue to examine them 
in our analysis. 

e. Human Immunodeficiency Virus 
(HIV) Infections. We have been 
evaluating the impact on the Medicare 
population of the increasing number of 
cases with human immunodeficiency 
virus (HIV) infections to ensure that 
payment under the DRG classification 
system for these patients is appropriate. 

1IIV infections are identified by 
diagnosis codes 042.0—042.9 (HIV 
infection with specified conditions), 

043.0—043.9 (f IIV infection causing 
other specified conditions), and 044.0— 
044.9 (Other HIV infection). Currently, 
cases that have one of these codes as 
the principal diagnosis are assigned to 
DRGs 398 or 399 (Reticuloendothelial 
and Immunity Disorders) in MDC 16 
(Diseases and Disorders of the Blood 
and Blood Forming Organs and 
Immunological Disorders). 

Our analysis of FY 1987 and FY 1988 
MEDPAR data showed that HIV- 
infected patients were distributed 
across a number of DRG9 and that their 
costs were significantly higher than 
other patients within the same DRG. In 
addition. we found that surgical patients 
differed noticeably from medical 
patients in terms of resource 
consumption as measured by total 
charges. 

Because of the substantial increase in 
I UV infection cases and our analysis of 
the charge data for these cases, we 
believe that it is now appropriate to 
establish separate DRGs for HIV cases. 
Based on our analysis of FY 1989 
MEDPAR data, we proposed to add a 
new MDC 25 (Human Immunodeficiency 
Virus Infections) with three DRG 
categories for HIV-infected patients. 
These classifications are as follows: 

DRG 488 HIV with Extensive OR Procedure 
DRG 489 HIV with Major Related Condition 
DRG 490 HIV with or without Other Related 

Condition 

We proposed to limit the HIV-related 
conditions to those identified by the 
Centers for Disease Control (CDC). 

These conditions, which were'originally 
set forth in CDC’s Official Authorized 
Addendum to ICD-9-CM (Revision No. 

1) effective January 1,1988, are listed in 
Volume 1 iri the "Includes Only" notes 


under diagnosis codes 042.0, 042.1, 042.2, 
043.1, 043.3, and 044.0. 

We proposed to assign cases to MDC 
25 prior to the current MDC 
classifications, but after cases have 
been grouped to the liver and bone 
marrow transplant, tracheostomy, or 
multiple significant trauma DRGs. 

We proposed that the OR procedures 
allowed for DRG 488 would be all OR 
procedures other than nonextensive OR 
procedures. Nonextensive procedures 
are those OR procedures that result in 
assignment to DRG 477 when the 
procedure is unrelated to the principal 
diagnosis. (See discussion below in 
section IH.B.8 of this preamble regarding 
changes to DRG 477.) We proposed that 
surgical cases with only a nonextensive 
OR procedure and medical cases would 
be assigned to DRG 489 or 490 based on 
the HIV-related condition. If the HIV- 
related condition involves a disease or 
disorder of the central nervous system, a 
malignancy, an infection, or other major 
related condition, we proposed to assign 
the case to DRG 489. We proposed to 
assign the remaining cases, HIV 
infection with and without an HIV- 
related condition, to DRG 490. 

Comment: We received several 
comments supporting our proposed 
DRGs for patients with HIV infection. 
While the majority of comments were 
overwhelmingly favorable, one 
commenter believes that we have not 
demonstrated that HIV patients could 
be grouped sufficiently well for payment 
purposes, that the number of groups is 
inadequate, and that there is no 
category for children with HIV. The 
commenter stated that the 
appropriateness of categories to all age 
patients should be identified, and if all 
age groups have not been studied, this 
should be acknowledged. 

One other commenter referred to the 
inadequacy of three DRG groups to 
accommodate the variable diagnoses, 
treatments, and related services 
presented by HIV patients. This 
commenter referred to the fact that New 
York, whose classification methodology 
served as a model for many of our 
proposed modifications and DRGs, has 
12 HIV DRG categories. The limit of 
three is felt by this commenter to result 
in inequitable payments to hospitals due 
to the significant variance in the costs 
for the cases grouped together. 

Response: Our evaluation of 3 years 
of data, using MEDPAR FY 1987, FY 
1988, and FY 1389 data, documented the 
need for and feasibility of DRGs specific 
to HIV infection. We used our standard 
method of analysis, basing decisions on 
statistical findings and clinical 
cohesiveness. To the extent possible, the 







36020 Federal Register / Vol. 55, No. 171 / Tuesday, September 4, 1990 / Rules and Regulations 


HIV infection discharges were studied 
and determined to be manageable as an 
MDC. The issue of including a DRG for 
children with HIV infection is not 
relevant for the Medicare population. 
The majority of Medicare beneficiaries 
are 65 years of age or older. There is a 
Medicare benefit available on the basis 
of disability. This, however, is a small 
group with an even smaller number of 
children represented. While there are an 
increasing proportion of patients under 
65 years of age with HIV infections 
appearing in our MEDPAR data, the 
distribution of cases by age 
demonstrated there was only one 
patient in the data who would classify 
as “child" (16 years of age). To attempt 
age category designations would not be 
feasible on the basis of case frequency 
in the MEDPAR data. We note that 
although the current DRGs include some 
DRGs specific to children under age 17, 
these are generally low volume DRGs 
whose weights were established at the 
outset of the Medicare program based 
on non-Medicare data from Michigan 
and Maryland hospitals. We have not 
supplemented our MEDPAR data with 
updated non-Medicare data since the 
initial weights for these low volume 
DRGs were established nor have we 
established any additional low volume 
DRGs. Those commenters who are 
interested in HIV categories related to 
age might consider the New York State 
model. 

New York State does indeed have 12 
HIV DRGs as pointed out by the 
commenter. The criteria determining the 
grouping, after principal and secondary 
diagnoses, are age and opioid use. We 
do not believe that either of these 
criteria are appropriate to the Medicare 
population. New York State developed 
their classification methodology to serve 
an all payer (except Medicare), system 
that encompasses all age groups. The 
first grouping under the New York 
method selects patients under 29 years 
of age, the second selection criterion is 
neonatal diagnosis, thus creating two 
DRGs for newborns. Children bom with 
HIV infections will go to one of these 
DRGs. The third selection is based on a 
principal diagnosis of HIV infection with 
a principal diagnosis of significant HIV 
related condition. These HIV cases are 
then further subdivided based on age (13 
years) and opioid use. The objective for 
New York was to be able to identify 
HIV infections related to intravenous 
drug use and patient age. The 
classification system determined to best 
fit the Medicare population was the one 
proposed, representing surgical cases, 
cases with major HIV-related 
conditions, and other HIV cases. We 


recognize that the medical HIV DRGs 
are not as homogeneous as the surgical 
DRG; this pattern holds across DRGs in 
general. We will be monitoring the 
performance of the HIV DRGs, 
evaluating the variance within and 
between groups, and will consider 
modifications as they prove necessary 
based on empirical data and clinical 
judgment. 

Comment: ProPAC agreed that the 
proposed HIV DRGs are an 
improvement and will both allow these 
cases to be clearly identified and 
provide a mechanism for 
accommodating future treatment 
changes. However, ProPAC referred to 
results of the Commission's data 
analysis. Using FY 1987 and FY 1988 
MEDPAR data, ProPAC found that, 
among cases with HIV as a secondary 
diagnosis, there did not appear to be 
significant payment problems, although 
cases with a principal diagnosis of HIV 
infection appeared to be more costly 
and underpaid relative to other cases in 
the DRGs to which HIV cases were 
assigned (DRGs 398 and 399). 

Response: HCFA data analysis, 
preliminary to proposing the 
development of DRGs specific to HIV 
infections, was based on FY 1989 
MEDPAR data, as well as FYs 1987 and 
1988. Some of our findings were similar 
to ProPAC’s: Cases with a principal 
diagnosis of HIV infection incurred 
charges and lengths of stay that were, 
on average, higher than other cases in 
the same DRGs. However, we found that 
cases with a secondary diagnosis of HIV 
infection with a principal diagnosis from 
the CDC list of HIV-related conditions, 
on average, also incurred higher charges 
than other cases in the same DRG. 
Although this difference was not as 
significant when HIV was secondary, 
our DRG classification decisions are 
based on clinical as well as empirical 
data. Our medical experts evaluated the 
HIV infection cases both as principal 
and as secondary diagnoses and believe 
these cases would be best served by 
creating DRGs for all HIV cases 
regardless of the sequencing of the 
diagnoses. However, if HIV infection is 
reported as the secondary diagnosis, the 
case will be assigned to one of the HIV 
DRGs only if the principal diagnosis is 
on the CDC list of HIV-related 
conditions. 

Comment: One commenter expressed 
concern that HIV cases might receive 
less payment in DRG 489 or 490 as 
opposed to the DRGs that recognize the 
extensive surgical procedures performed 
with many of these cases. Another 
commenter objected to the creation of a 
surgical split for HIV cases since most 


major operating procedures performed 
for HIV cases are not related to the HIV 
illness and a principal diagnosis 
unrelated to HIV is usually indicated. 

Response: MDC 25 cases with 
extensive surgery will not be assigned to 
DRG 489 or 490, but will be assigned to 
DRG 488. with a weight of 4.1290. An 
examination of the surgical DRGs to 
which these patients would be grouped 
in the absence of the new groupings 
shows that the volume of HIV surgical 
cases are from DRGs that are weighted 
significantly lower than DRG 488. 
Nonextensive procedures performed on 
HIV patients that would have grouped 
to DRG 477 will be assigned to DRG 489 
or 490, depending on the presence of a 
major HIV-related condition. 

As for the case of surgical procedures 
for patients with a principal diagnosis 
unrel