[Federal Register Volume 69, Number 226 (Wednesday, November 24, 2004)]
[Rules and Regulations]
[Pages 68720-68749]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-26066]



[[Page 68719]]

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Part VIII





Department of Homeland Security





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Transportation Security Administration



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49 CFR Part 1572



Security Threat Assessment for Individuals Applying for a Hazardous 
Materials Endorsement for a Commercial Driver's License; Final Rule

Federal Register / Vol. 69, No. 226 / Wednesday, November 24, 2004 / 
Rules and Regulations

[[Page 68720]]


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DEPARTMENT OF HOMELAND SECURITY

Transportation Security Administration

49 CFR Part 1572

[Docket No. TSA-2003-14610; Amendment No. 1572-4]
RIN 1652-AA17


Security Threat Assessment for Individuals Applying for a 
Hazardous Materials Endorsement for a Commercial Driver's License

AGENCY: Transportation Security Administration (TSA), DHS.

ACTION: Interim final rule; request for comments.

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SUMMARY: TSA is amending standards relating to security threat 
assessments of commercial truck drivers who are authorized to transport 
hazardous materials. TSA is adding definitions, and making 
organizational and substantive changes to the current standards 
codified at 49 Code of Federal Regulations (CFR) part 1572. First, this 
rule requires each State to declare whether it wishes to capture and 
submit fingerprints, applicant information, and fees itself, or 
alternatively chooses to have TSA complete those tasks. Second, TSA is 
changing the standards to permit certain aliens who are qualified to 
hold a commercial drivers license to apply for a security threat 
assessment. Third, TSA is removing one felony offense, simple drug 
possession, from the list of disqualifying crimes, and adding unlawful 
purchase, receipt, transfer, shipping, transporting, import, export, 
and storage of a firearm or explosives to the list. TSA is 
reclassifying the criminal offense of arson as an interim rather than 
permanent disqualifier, and reclassifying the offense of murder as a 
permanent rather than an interim disqualifier. TSA now prohibits 
individuals convicted of the most serious crimes, such as treason, from 
applying for a waiver. TSA is increasing the response time limits for 
appeals and waivers. TSA is changing the rule concerning transferring a 
hazardous materials endorsement from one State to another so that 
drivers do not have to undergo a new background check when obtaining a 
license in a new State, subject to some restrictions. TSA is enhancing 
the appeal procedures for an individual who is determined to pose a 
security threat as a result of the intelligence-related check. The rule 
moves the start date of the fingerprint-based checks for transfer and 
renewal applicants to May 31, 2005. The rule no longer requires the 
States to forward all driver applications to TSA, but the States must 
retain the applications for one year. States that elect to collect 
fingerprints and driver information must submit the information and 
fingerprints electronically, with some initial assistance from TSA. 
Finally, TSA is reducing the amount of advance notice the States must 
provide to drivers who hold hazardous materials endorsements regarding 
the need for a security threat assessment upon renewal. TSA is making 
these changes in response to comments received from the affected 
parties and to clarify further the implementation of this program.

DATES: Effective Date: This rule is effective November 24, 2004.
    Comment Date: Submit comments by December 27, 2004.

ADDRESSES: You may submit comments, identified by the TSA docket number 
to this rulemaking, using any one of the following methods:
    Comments Filed Electronically: You may submit comments through the 
docket Web site at http://dms.dot.gov. Please be aware that anyone is 
able to search the electronic form of all comments received into any of 
our dockets by the name of the individual submitting the comment (or 
signing the comment, if submitted on behalf of an association, 
business, labor union, etc.). You may review the applicable Privacy Act 
Statement published in the Federal Register on April 11, 2000 (65 FR 
19477), or you may visit http://dms.dot.gov.
    You also may submit comments through the Federal eRulemaking portal 
at http://www.regulations.gov.
    Comments Submitted by Mail, Fax, or In Person: Address or deliver 
your written, signed comments to the Docket Management System, U.S. 
Department of Transportation, Room Plaza 401, 400 Seventh Street, SW., 
Washington, DC 20590-0001; Fax: 202-493-2251.
    Comments on Paperwork Collection: Comments may be faxed to the 
Office of Information and Regulatory Affairs, Office of Management and 
Budget, Attention: DHS-TSA Desk Officer, at (202) 395-5806. Comments 
may be mailed to the Office of Information and Regulatory Affairs, 
Office of Management and Budget, 725 17th Street, NW., Washington, DC 
20503, Attention: DHS-TSA Desk Officer.
    Declarations Submitted by the States: Address the State 
Declarations required in Sec.  1572.13(f) to: Program Manager, 
Credentialing Program Office, 601 S. 12th St., 8th floor, Arlington, 
VA, 22202.
    Reviewing Comments in the Docket: You may review the public docket 
containing comments in person in the Dockets Office between 9 a.m. and 
5 p.m., Monday through Friday, except Federal holidays. The Dockets 
Office is located on the plaza level of the NASSIF Building at the 
Department of Transportation address above. Also, you may review public 
dockets on the Internet at http://dms.dot.gov.
    See SUPPLEMENTARY INFORMATION for format and other information 
about comment submissions.

FOR FURTHER INFORMATION CONTACT: Kevin Johnson, Credentialing Program 
Office, Transportation Security Administration HQ, East Building, 601 
South 12th Street, Arlington, VA 22202-4220; telephone (571) 227-2155; 
e-mail <a href="/cdn-cgi/l/email-protection#95def0e3fcfbbbdffafdfbe6fafbd5f1fde6bbf2fae3"><span class="__cf_email__" data-cfemail="e7ac82918e89c9ad888f89948889a7838f94c9808891">[email protected]</span></a>.
    Christine Beyer, Office of Chief Counsel, Transportation Security 
Administration, HQ, East Tower, 601 South 12th St., Arlington, VA 
22202-4220; 571-227-2657; e-mail: <a href="/cdn-cgi/l/email-protection#54173c263d27203d3a317a16312d312614303c277a333b22"><span class="__cf_email__" data-cfemail="e4a78c968d97908d8a81caa6819d8196a4808c97ca838b92">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

Comments Invited

    This Interim Final Rule is being adopted without prior notice and 
prior public comment. However, to the maximum extent possible, TSA 
provides an opportunity for public comment on regulations issued 
without prior notice. Accordingly, TSA invites interested persons to 
participate in this rulemaking by submitting written comments, data, or 
views. We also invite comments relating to the economic, environmental, 
energy, or federalism impacts that might result from adopting the 
requirements in this document. See ADDRESSES above for information on 
where to submit comments.
    With each comment, please include your name and address, identify 
the docket number at the beginning of your comments, and give the 
reason for each comment. The most helpful comments reference a specific 
portion of the rule, explain the reason for any recommended change, and 
include supporting data. You may submit comments and material 
electronically, in person, by mail, or fax as provided under ADDRESSES, 
but please submit your comments and material by only one means. If you 
submit comments by mail or delivery, submit them in two copies, in an 
unbound format, no larger than 8.5 by 11 inches, suitable for copying 
and electronic filing.
    If you want TSA to acknowledge receipt of your comments on this 
rulemaking, include with your comments a self-addressed, stamped 
postcard on which the docket number

[[Page 68721]]

appears. We will stamp the date on the postcard and mail it to you.
    Except for comments containing confidential information and 
Sensitive Security Information (SSI), we will file all comments we 
receive in the public docket, as well as a report summarizing each 
substantive public contact with TSA personnel concerning this 
rulemaking. The docket is available for public inspection before and 
after the comment closing date.
    We will consider all comments we receive on or before the closing 
date for comments. We will consider comments filed late to the extent 
practicable. We may change this rulemaking in light of the comments we 
receive.

Availability of Rulemaking Document

    You can get an electronic copy using the Internet by--
    (1) Searching the Department of Transportation's electronic Docket 
Management System (DMS) web page (http://dms.dot.gov/search);
    (2) Accessing the Government Printing Office's web page at http://www.access.gpo.gov/su_docs/aces/aces140.html; or
    (3) Visiting the TSA's Law and Policy web page at http://www.tsa.dot.gov/public/index.jsp.
    In addition, copies are available by writing or calling the 
individual in the FOR FURTHER INFORMATION CONTACT section. Make sure to 
identify the docket number of this rulemaking.

Small Entity Inquiries

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 
1996 requires TSA to comply with small entity requests for information 
and advice about compliance with statutes and regulations within TSA's 
jurisdiction. Any small entity that has a question regarding this 
document may contact the person listed in FOR FURTHER INFORMATION 
CONTACT. Persons can obtain further information regarding SBREFA on the 
Small Business Administration's web page at http://www.sba.gov/advo/laws/law_lib.html.

Abbreviations and Terms Used in This Document

ATSA--Aviation and Transportation Security Act
ATF--Bureau of Alcohol, Tobacco, Firearms, and Explosives
CDC--Centers for Disease Control and Prevention
CDL--Commercial drivers license
CDLIS--Commercial drivers license information system
CHRC--Criminal history records check
CJIS--Criminal Justice Information Services Division
DHS--Department of Homeland Security
DOJ--Department of Justice
DMV--Department of Motor Vehicles
DOT--Department of Transportation
FBI--Federal Bureau of Investigation
FMCSA--Federal Motor Carrier Safety Administration
HSA--Homeland Security Act
HME--Hazardous materials endorsement
HMR--Hazardous materials regulations
MTSA--Maritime Transportation Security Act
RSPA--Research and Special Programs Administration
SEA--Safe Explosives Act
TSA--Transportation Security Administration
USA PATRIOT Act--Uniting and Strengthening America by Providing 
Appropriate Tools Required to Intercept and Obstruct Terrorism Act

I. Background

    In response to the September 11 terrorist attacks on the United 
States, Congress passed the Aviation and Transportation Security Act 
(ATSA), which established the Transportation Security Administration 
(TSA).\1\ TSA was created as an agency within the Department of 
Transportation (DOT), operating under the direction of the Under 
Secretary of Transportation for Security. Effective on March 1, 2003, 
TSA became an agency of the Department of Homeland Security (DHS), and 
the head of TSA is now the Assistant Secretary for Homeland Security, 
Transportation Security Administration (Assistant Secretary).
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    \1\ Pub. L. 107-71, November 19, 2001, 115 Stat. 597.
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    On May 5, 2003, TSA published an interim final rule (May 5 IFR) 
that requires a security threat assessment of commercial drivers who 
are authorized to transport hazardous materials in commerce.\2\ The May 
5 IFR implemented several statutory mandates discussed below, including 
fingerprint-based criminal history records checks (CHRC), checks 
against international databases, and appeal and waiver procedures. The 
May 5 IFR required CHRC to begin no later than November 3, 2003.
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    \2\ 68 FR 23852 (May 5, 2003).
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    TSA requested and received comments from the States, labor 
organizations, and representatives of the trucking industry. In 
addition, TSA held working group sessions with the States to discuss 
potential fingerprinting systems that would achieve the statutory 
requirements, but would not adversely impact the States. Based on the 
comments received and our working sessions with the States, TSA issued 
a technical amendment in November 2003 \3\ to extend the date on which 
submission of fingerprints and applicant information would begin to be 
required. The reasons for the amendment were that a majority of the 
States could not implement the program by November and TSA did not have 
authority to collect fees to cover TSA's implementation costs. The 
amendment required the States to submit fingerprints and applicant 
information by April 1, 2004, or request an extension of time and 
produce a fingerprint collection plan by April 1, 2004. All States were 
required to have the fingerprint collection program in place as of 
December 1, 2004.
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    \3\ 68 FR 63033 (November 7, 2003).
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    In response to the November 2003 technical amendment, a majority of 
the States asked for an additional extension of time because they could 
not begin collecting applicant information or fingerprints by the 
extended deadline of April 1, 2004. Therefore, on April 6, 2004, TSA 
published a final rule removing the April 1 date and establishing 
January 31, 2005, as the date on which CHRC must begin.\4\ The Interim 
Final Rule we publish today reorganizes, clarifies, and adds operating 
details to the hazmat program.
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    \4\ 69 FR 17696 (April 6, 2004).
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    In October 2003, legislation was enacted that authorized TSA to 
collect user fees to cover the cost of each security threat 
assessment.\5\ Pursuant to this legislation, TSA on November 10, 2004 
(69 FR 65332), published a notice of proposed rulemaking (NPRM) to 
establish reasonable fees for the threat assessment process. TSA plans 
to have the implementation of the hazmat security threat assessment 
program coincide with our ability to collect fees.
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    \5\ Department of Homeland Security Appropriations Act, 2004, 
Section 520, Pub. L. 108-90, October 1, 2003, 117 Stat. 1137.
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II. USA PATRIOT Act

    The Uniting and Strengthening America by Providing Appropriate 
Tools Required to Intercept and Obstruct Terrorism Act (USA PATRIOT 
Act) was enacted on October 25, 2001.\6\ Section 1012 of the USA 
PATRIOT Act amended 49 U.S.C. Chapter 51 by adding a new section 5103a 
titled ``Limitation on issuance of hazmat licenses.'' Section 
5103a(a)(1) provides:
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    \6\ Pub. L. 107-56, October 25, 2001, 115 Stat. 272.

    A State may not issue to any individual a license to operate a 
motor vehicle transporting in commerce a hazardous material unless 
the Secretary of Transportation has first determined, upon

[[Page 68722]]

receipt of a notification under subsection (c)(1)(B), that the 
individual does not pose a security risk warranting denial of the 
license.\7\
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    \7\ The Secretary of Transportation delegated the authority to 
carry out the provisions of this section to the Under Secretary of 
Transportation for Security/Assistant Secretary. 68 FR 10988, March 
7, 2003.

    Section 5103a(a)(2) subjects license renewals to the same 
requirements.
    Section 5103a(c) requires the Attorney General, upon the request of 
a State in connection with issuance of an HME, to carry out a 
background records check of the individual applying for the endorsement 
and, upon completing the check, to notify the Secretary (as delegated 
to the Assistant Secretary) of the results. The Secretary then 
determines whether the individual poses a security risk warranting 
denial of the endorsement. The security threat assessment must consist 
of: (1) A check of the relevant criminal history databases; (2) in the 
case of an alien, a check of the relevant databases to determine the 
status of the alien under U.S. immigration laws; and (3) as 
appropriate, a check of the relevant international databases through 
Interpol-U.S. National Central Bureau or other appropriate means.

III. Safe Explosives Act

    Congress enacted the Safe Explosives Act (SEA) on November 25, 
2002.\8\ Sections 1121-23 of the SEA amended section 842(i) of title 
18, United States Code, by adding several categories to the list of 
persons who may not lawfully ``ship or transport any explosive in or 
affecting interstate or foreign commerce'' or ``receive or possess any 
explosive which has been shipped or transported in or affecting 
interstate or foreign commerce.'' Prior to the amendment, 18 U.S.C. 
842(i) prohibited the transportation of explosives by any person under 
indictment for or convicted of a felony, a fugitive from justice, an 
unlawful user or addict of any controlled substance, and any person who 
had been adjudicated as lacking mental capacity \9\ or committed to a 
mental institution. The 2002 amendment added three new categories to 
the list of prohibited persons: aliens, with certain exceptions;\10\ 
persons dishonorably discharged from the armed forces; and former U.S. 
citizens who have renounced their citizenship. Individuals who violate 
18 U.S.C. 842(i) are subject to criminal prosecution.\11\ These 
incidents are investigated by the Bureau of Alcohol, Tobacco, Firearms, 
and Explosives (ATF) of the Department of Justice and referred, as 
appropriate, to the United States Attorneys.
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    \8\ Pub. L. 107-296, November 25, 2002, 116 Stat. 2280.
    \9\ Since 1970, the Federal explosives law has identified a 
category of persons prohibited from possessing explosives as 
``adjudicated as a mental defective.'' TSA is replacing this term 
with ``adjudicated as lacking mental capacity.'' However, these 
terms have the same meaning for the purposes of the Federal 
explosives law and the TSA hazmat requirements.
    \10\ The prohibition in the SEA extends to each person--
    (5) Who is an alien, other than an alien who--
    (A) Is lawfully admitted for permanent residence (as that term 
is defined in section 101(a)(20) of the Immigration and Nationality 
Act); or
    (B) Is in lawful nonimmigrant status, is a refugee admitted 
under section 207 of the Immigration and Nationality Act (8 U.S.C. 
1157), or is in asylum status under section 208 of the Immigration 
and Nationality Act (8 U.S.C. 1158), and--
    (i) Is a foreign law enforcement officer of a friendly foreign 
government, as determined by the Secretary in consultation with the 
Secretary of State, entering the United States on official law 
enforcement business, and the shipping, transporting, possession, or 
receipt of explosive materials is in furtherance of this official 
law enforcement business; or
    (ii) Is a person having the power to direct or cause the 
direction of the management and policies of a corporation, 
partnership, or association licensed pursuant to section 843(a), and 
the shipping, transporting, possession, or receipt of explosive 
materials is in furtherance of such power;
    (C) Is a member of a North Atlantic Treaty Organization (NATO) 
or other friendly foreign military force, as determined by the 
Attorney General in consultation with the Secretary of Defense, who 
is present in the United States under military orders for training 
or other military purpose authorized by the United States and the 
shipping, transporting, possession, or receipt of explosive 
materials in furtherance of the authorized military purpose; or
    (D) Is lawfully present in the United States with the Director 
of Intelligence, and the shipment, transportation, receipt, or 
possession of the explosive materials is in furtherance of such 
cooperation;* * *''
    \11\ The penalty for violation of 18 U.S.C. 842(i) is up to ten 
years imprisonment and a fine of up to $250,000.
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    However, 18 U.S.C. 845(a)(1) provides an exception to section 
842(i) for ``any aspect of the transportation of explosive materials 
via railroad, water, highway, or air which are regulated by the United 
States Department of Transportation and agencies thereof, and which 
pertain to safety.'' Under this exception, if DOT regulations address 
the transportation security issues of persons engaged in a particular 
aspect of the safe transportation of explosive materials, then those 
persons are not subject to prosecution under 18 U.S.C. 842(i) while 
they are engaged in the transportation of explosives in commerce. TSA 
issued the May 5 IFR and amendments in coordination with agencies 
within DOT, the Federal Motor Carrier Safety Administration (FMCSA) and 
Research and Special Programs Administration (RSPA), and triggered this 
exception. Therefore, the SEA does not apply to commercial drivers with 
HMEs while they are engaged in the transportation of explosives in 
commerce.

IV. The Current Rule

    To comply with the mandates of the USA PATRIOT Act, and to trigger 
the exception in 18 U.S.C. 845(a)(1) for the transportation of 
explosives, TSA issued the May 5 IFR, technical amendments, and Final 
Rule (referred to collectively through the remainder of this document 
as the Current Rule). Under the Current Rule, TSA determines that an 
individual poses a security threat if he or she: (1) Is an alien 
(unless he or she is a lawful permanent resident) or a U.S. citizen who 
has renounced his or her U.S. citizenship; (2) is wanted or under 
indictment for certain felonies; (3) has a conviction in military or 
civilian court for certain felonies; (4) has been adjudicated as 
lacking mental capacity or involuntarily committed to a mental 
institution; or (5) is considered to pose a security threat based on a 
review of pertinent databases.
    The Current Rule also establishes conditions and procedures under 
which an individual who has been determined to pose a security threat 
can appeal the determination. The Current Rule provides a waiver 
process for those individuals who otherwise could not obtain a 
hazardous materials endorsement (HME) due to a disqualifying felony 
conviction or lack of mental capacity. Any holder of an HME who has 
committed a disqualifying offense is required to surrender the 
endorsement as of September 2, 2003. Finally, the Current Rule 
prohibits an individual from holding, and a State from issuing or 
renewing an HME for an individual unless the individual meets the TSA 
security threat assessment standards.

V. Response to Public Comments

    TSA received over 100 comments from individual commercial drivers, 
small trucking companies, national and international carriers, labor 
organizations, State Departments of Motor Vehicles (DMVs), industry 
associations, and associations representing State government. The 
discussion below groups the comments by the primary issues raised by 
the public.

A. Shortage of Time and Resources

    The overwhelming majority of the comments are from the States and 
concern the need for additional time and resources. The States notified 
TSA that State funding, human resources, and technology are in short 
supply. Many of the States needed additional

[[Page 68723]]

State legislative authority to conduct the program and to collect fees 
to pay for the States' costs in implementing the program. To the 
fullest extent possible, TSA has issued extensions of time for the 
start date of the fingerprint-based CHRC to accommodate these requests 
and to provide TSA time to develop the fee proposed rule, after TSA 
obtained legislative authority to collect user fees to support the 
security threat assessment program.
    Many of the States raised technical questions concerning the 
electronic interface that must exist for the States, TSA, and the 
Federal Bureau of Investigation (FBI) to receive and transmit data. 
These are daunting issues in light of the fact that each State and the 
Federal agencies have unique data management systems, with varying 
levels of sophistication. TSA is building a new Credentialing Screening 
Gateway System (Screening Gateway) to collect, retain, and transmit all 
of the information that must be collected from the applicant to conduct 
a security threat assessment. Once this system is complete, TSA will be 
prepared to receive all of the data fields required when the applicant 
provides the required information for an HME. TSA considers the process 
for collecting applicants' fingerprints for purposes of this 
regulation--working through State Departments of Motor Vehicles and 
allowing States either to collect the fingerprints themselves or to ask 
TSA to do so--as the best process to implement the USA PATRIOT Act's 
requirements in the near term. DHS is collecting fingerprints for other 
Departmental programs and expects to implement other programs in the 
future that will involve fingerprint collection. As all of these 
programs evolve, DHS will consider whether processes for this program, 
or for several DHS programs, can be consolidated to improve efficiency 
while fulfilling security needs. If greater efficiencies are possible, 
TSA will consider amending this rule, if necessary, to achieve those 
efficiencies.
    TSA is not requiring the States to develop new connectivity with 
the TSA Screening Gateway. In States that choose to collect 
fingerprints and applicant information rather than use TSA for that 
purpose, the State will be responsible for transmitting the information 
to TSA electronically through the existing Commercial Drivers License 
Information System (CDLIS), and ensuring that the fingerprints are 
forwarded to the FBI in a form and manner consistent with FBI and TSA 
standards. TSA will assist in the electronic transfer of information in 
States that are in the process of upgrading their systems when the rule 
becomes effective. In these States, for a short time TSA will accept 
the information in alternate forms, such as email or facsimiles; and 
will format or digitize the information into a useable format until the 
States' computer upgrades are complete. TSA believes that the ability 
to exchange information electronically will benefit the States, the 
industry, and TSA in the long run and so TSA encourages the States to 
opt for this process. If a State knows that it will not be able to 
transmit the information electronically until after July 2005, however, 
the State should formally elect to have TSA capture the fingerprints 
and driver information. TSA can staff the data entry for a short period 
of time until a State's computer system is upgraded, but TSA does not 
have the resources to perform that task beyond July 2005.

B. List of Disqualifying Criminal Offenses.

    Many individual drivers, trucking companies, and the States 
submitted comments on the list of disqualifying offenses in the Current 
Rule. For that reason, TSA reevaluated the list in order to ensure that 
it is not over- or under-inclusive. As a result, TSA is making several 
changes to the list of disqualifying crimes.
    The list of permanently disqualifying offenses in the Current Rule 
includes espionage, treason, sedition, a crime involving a 
transportation security incident, improper transportation of a 
hazardous material, a terrorist crime, arson, unlawful use of an 
explosive, and conspiracy to commit any of these crimes. TSA is making 
four changes to the list of permanently disqualifying offenses: arson 
is reclassified as an interim rather than a permanent disqualifier, 
violations of the Racketeer Influenced Corrupt Organizations Act (RICO) 
are permanently disqualifying if an underlying crime is a permanent 
disqualifier (such as a terrorist conviction under 18 U.S.C. chapter 
113B); TSA is adding unlawful purchase, receipt, transfer, shipping, 
transporting, import, export or storage of an explosive to former 
paragraph 1572.103(b)(9); and TSA is reclassifying murder as a 
permanently disqualifying crime.
    TSA is amending the list of interim disqualifying offenses by 
adding arson and unlawful purchase, receipt, transfer, shipping, 
transporting, import, export or storage of a firearm, and by 
reclassifying murder and removing simple drug possession from the list. 
Possession with intent to distribute remains an interim disqualifying 
offense.
    TSA developed the list of disqualifying felony convictions in 
consultation with the Department of Justice (DOJ) and DOT, to include 
those offenses that are reasonably indicative of an individual's 
predisposition to engage in violent or deceptive behavior that may be 
predictive of a security threat. Some States suggested that all 
criminal convictions should be disqualifying. The USA PATRIOT Act 
requires TSA to ``review relevant criminal databases'' and appropriate 
international databases to determine whether the applicant poses a 
security threat. Based on the legislative language and the need to keep 
commerce moving, TSA believes that disqualification of all drivers with 
a criminal record is not necessary. Past history and current threat 
information do not indicate that all persons with a criminal conviction 
pose a security threat. We believe that the rule lists the criminal 
offenses that indicate an individual's predisposition to engage in 
violent or deceptive activity that may reasonably give rise to a 
security threat.
    TSA is removing simple possession of a controlled substance from 
the list based on comments received and our own analysis. Simple drug 
possession generally does not involve violence against others or reveal 
a pattern of deception, as crimes like smuggling or bribery often do. 
In addition, FMCSA's regulations governing the commercial driver's 
license program require CDL holders to undergo pre-application, post-
accident, and random alcohol and drug testing. 49 CFR part 382. A 
positive drug or alcohol test will result in restrictions on the 
driver's CDL or disqualification. TSA believes that these standards act 
as a strong deterrent against alcohol or drug use while employed as a 
CDL driver. To the extent that an individual with a simple drug 
possession conviction presents a threat, the current CDL testing 
requirements most likely deter dangerous individuals with drug use 
problems from seeking employment as a hazmat driver. Based on this, and 
because simple drug possession generally does not fall within the class 
of crimes involving violence or deception, TSA has determined that 
there should be no adverse impact resulting from removing conviction 
for simple possession of a controlled substance from the list of 
disqualifying offenses. Conviction for possession of drugs with intent 
to distribute remains a disqualifying crime.
    We are reclassifying arson as an interim rather than a permanent 
disqualifying offense. In reevaluating

[[Page 68724]]

the list of most serious crimes--those that disqualify an applicant for 
life--TSA believes that arson is not always an act of terrorism, as the 
other permanent disqualifying crimes typically are. Although an arson 
conviction may be indicative of a very dangerous individual who should 
not have control of hazardous material shipments, we do not believe 
that it rises to the same level of threat as espionage and treason do. 
It remains a disqualifying offense in this IFR, and TSA can carefully 
consider the underlying facts if a convicted arsonist applies for a 
waiver to determine whether the facts are indicative of an individual 
who presents on ongoing, unacceptable risk to security.
    We are reclassifying murder as a permanent rather than interim 
disqualifying offense. Murder is one of the most violent crimes on the 
list of disqualifiers and indicates a disregard for human life. In 
reevaluating the standards, TSA has concluded that the crime of murder 
should be permanently disqualifying.
    TSA is adding a RICO offense to the list of permanent disqualifiers 
if the underlying or predicate racketeering act for the RICO conviction 
is a permanently disqualifying offense. TSA understands that RICO 
convictions are often the result of a series or variety of criminal 
acts that may not be listed in the criminal history records. However, 
if a defendant is found by the trier of fact, or by his own admission 
in the course of a guilty plea, to have committed a permanently 
disqualifying offense as a predicate to a RICO conviction, TSA will 
consider the RICO conviction as permanently disqualifying. Conversely, 
where a RICO conviction is based on a series of robberies, the RICO 
conviction becomes an interim disqualifying offense. TSA does not 
anticipate that RICO violations will surface often during the security 
threat assessment process, but wishes to ensure that they are handled 
consistently and appropriately if they arise.
    With respect to a conviction involving improper shipment of a 
hazardous material under Sec.  1572.103(a)(6), TSA has added the 
corresponding Federal statutory citation to the rule (49 U.S.C. 5124) 
to specify the provision of law that is disqualifying. TSA has made 
this change in response to comments from the Institute of Makers of 
Explosives (IME) and the National Propane Gas Association (NPGA), in 
which they expressed concern that a State might charge an individual 
with a state crime that involves hazardous materials and incorrectly 
consider it a disqualifying offense under the Current Rule. Section 
5124 of title 49, United States Code, provides that a person who 
knowingly violates section 5104(b) of the law (tampering and marking 
standards for hazardous materials), or other law in Chapter 51, 
Transportation of Hazardous Materials, will be fined under title 18 of 
the Code, or imprisoned, or both. TSA agrees that adding the Federal 
citation avoids confusion or incorrect application of the law. This 
amendment clarifies that 49 U.S.C. 5124, or a state law that is 
comparable, is disqualifying.
    TSA has also added the phrase ``or State law that is comparable'' 
to crimes that include a specific Federal statutory citation to ensure 
that where a crime is committed pursuant to a State statute equivalent 
to these Federal statutes, it is clear that a conviction is 
disqualifying. The language has been added to paragraphs (a)(4), 
(a)(6), (a)(8), (a)(10) , and (b)(10).
    As part of the discussion on disqualifying criminal offenses, it is 
important to outline the waiver program in the Current Rule and this 
IFR. TSA's waiver program provides an avenue for drivers with criminal 
histories to present the circumstances of their crime, evidence of 
restitution or other sentencing conditions, rehabilitation, and letters 
of reference. TSA has received approximately 35 waiver requests to 
date. The rule imposes a lifetime ban on persons convicted of the most 
serious security-related offenses (such as treason, espionage, and 
sedition); any driver convicted of one of these felonies is not 
eligible for a waiver. However, a driver with a conviction for other 
disqualifying felonies may apply for a waiver of the standard.

C. Immigration Status

    With respect to certain aliens, TSA is amending the standards in 
this rule in response to comments received and TSA's analysis of the 
industry. The Current Rule permits citizens and lawful permanent 
residents to apply for a security threat assessment for an HME.
    The FMCSA has statutory authority to develop standards for 
obtaining a CDL. The FMCSA regulations require CDL holders to be 
domiciled in the licensing State or be issued a nonresident CDL under 
prescribed procedures.\12\ FMCSA's domicile requirement provides that a 
CDL holder must have a State of Domicile, which is defined as ``the 
State where a person has his true, fixed, permanent home and principal 
residence, and where he has the intention of returning whenever he is 
absent.''\13\ FMCSA's regulations also provide for situations in which 
a CDL operator is domiciled in a foreign jurisdiction that does not 
test drivers and issue CDLs in accordance with the FMCSA standards, and 
permits those individuals to obtain a non-resident CDL from a State 
that does comply with the testing and licensing requirements.\14\
    The trucking industry includes many alien drivers, including lawful 
nonimmigrants, refugees, and asylees. There are areas of the country, 
particularly the border States, where the concentration of non-citizens 
is very high. TSA has received correspondence from drivers in the 
United States under refugee status who understand that they cannot hold 
an HME under the Current Rule. In addition, their congressional 
representatives have expressed interest in authorizing these aliens to 
hold an HME. Employers have also expressed concern that the industry 
will be adversely impacted if all aliens are prohibited from holding an 
HME. This concern is particularly acute now because the trucking 
industry has informed TSA that the current annual employment turnover 
rate exceeds 80 percent. Employers report that good employees are 
difficult to find and keep, and often non-citizen employees are highly 
motivated to begin a trade in the United States once granted lawful 
status. Background checks are sometimes completed before an alien is 
granted lawful status or issued evidence of such status, but may not 
occur in some cases. However, assuming these individuals meet all CDL 
qualifications and apply for an HME, these applicants would undergo 
TSA's thorough security threat assessment.
---------------------------------------------------------------------------

    \12\ 49 CFR 384.212.
    \13\ 49 CFR 383.5.
    \14\ 49 CFR 383.23(b).
---------------------------------------------------------------------------

    For the reasons listed above, TSA has determined that the security 
threat assessment standards should be changed to permit nonimmigrant 
aliens, asylees, and refugees, who are in lawful status and possess 
valid and unrestricted documentation establishing eligibility for 
employment to apply for an HME and security threat assessment, if they 
are qualified to hold a CDL under 49 CFR parts 383 and 384. Any 
questions concerning the CDL requirements, particularly with respect to 
domicile, are governed by the FMCSA regulations and State DMV offices. 
As long as the applicant complies with the FMCSA regulations for 
obtaining a CDL, is in the country lawfully, is authorized to work in 
the U.S., successfully completes TSA's security threat assessment, and 
meets all other

[[Page 68725]]

applicable standards, the applicant will meet the security threat 
assessment standards for holding an HME. TSA believes that if these 
standards are met, a person's status as an alien alone should not 
disqualify the individual from holding an HME. Aliens in lawful status 
are permitted to join the U.S. armed services and operate in other 
modes of transportation, such as flying aircraft in U.S. airspace, as 
long as they meet all applicable standards. TSA believes hazmat drivers 
should be treated similarly.

D. Collection of Fingerprints

    Commenters asked TSA to permit the submission of fingerprints once 
and rerun those prints when the driver must renew or transfer an HME. 
They cite the cost and time needed to collect new fingerprints each 
time the driver undergoes a new security threat assessment as 
justification for recycling fingerprints. TSA understands these 
concerns and continues to develop a process and system to ensure that 
necessary fingerprint resubmissions are minimized.

E. Preemption

    Several commenters asked for clarification or reconsideration of 
the preemptive effect that this rule has on State or local law. TSA's 
rule provides minimum standards for a security threat assessment that 
all 50 States and the District of Columbia must meet. If a State wishes 
to take additional action to protect its citizens, TSA's rule does not 
prevent it.
    The State is the licensing body for drivers who are State residents 
and the State has a clear mandate and interest in protecting the 
residents and drivers within its borders from dangerous drivers. Thus, 
if a State determines that additional measures should be applied to 
drivers licensed by the State, and the measures are not inconsistent 
with TSA's rule, TSA does not wish to preclude the State from 
establishing them. As long as the State does not nullify or controvert 
the intent of the standards in this IFR, TSA's rule would not preempt 
State action. In deference to the State as the licensing body 
responsible for the welfare of its citizens, TSA believes that 
complementary State action may be appropriate. For instance, if a State 
adds a felony or misdemeanor conviction as disqualifying that is not 
among the list of disqualifying offenses in this rule, TSA's rule does 
not preempt application of the State law concerning drivers licensed in 
that State. However, a State is preempted from applying a standard in 
which the interim disqualifying offenses are no longer treated as 
disqualifying.
    Federal preemption of State driver licensing standards is treated 
differently from Federal preemption of State laws or regulations 
governing the transportation of hazardous materials in commerce. The 
Federal Hazardous Materials Regulations at 49 CFR parts 171-180 are 
promulgated under the mandate in section 5103(b) of the Federal 
hazardous materials transportation law [Federal hazardous materials 
(hazmat) law; 49 U.S.C. 5101 et seq., as amended by section 1711 of the 
Homeland Security Act of 2002, Public Law 107-296] that the Secretary 
of Transportation ``prescribe regulations for the safe transportation, 
including security, of hazardous material in intrastate, interstate, 
and foreign commerce.'' One of the primary purposes of Federal hazmat 
law is to ensure a nationally uniform set of regulations applicable to 
the transportation of hazardous materials in commerce. Thus, the 
preemption provisions of Federal hazmat law generally preclude non-
Federal governments from imposing requirements applicable to hazardous 
materials transportation if:
    (1) Complying with the non-Federal regulation and complying with 
Federal hazmat law, the hazmat safety regulations (HMR), a hazardous 
materials transportation security regulation, or directive issued by 
the Secretary of Homeland Security is not possible (dual compliance 
test; 49 U.S.C. 5125(a)(1)); or
    (2) The non-Federal requirement is an obstacle to carrying out 
Federal hazmat law, the HMR, or a hazardous materials transportation 
security regulation or directive issued by the Secretary of Homeland 
Security (obstacle test; 49 U.S.C. 5125(a)(2)).
    Further, Federal hazmat law preempts a non-Federal requirement 
applicable to any one of several specified covered subjects if it is 
not substantively the same as Federal hazmat law, the HMR, or a 
hazardous materials transportation security regulation or directive 
issued by the Secretary of Homeland Security (covered subjects test; 49 
U.S.C. 5125(b)).
    The HMR are not minimum requirements that other jurisdictions may 
exceed if local conditions warrant; rather, the HMR are national 
standards and must be uniformly applied across jurisdictional lines. 
However, another Federal law may authorize non-Federal requirements. 49 
U.S.C. 5125(a) and (b). Also, RSPA may waive preemption of a non-
Federal requirement if it: (1) Provides the public with at least as 
much protection as requirements of Federal hazmat law and the HMR, and 
(2) does not impose an unreasonable burden on commerce. 49 U.S.C. 
5125(e).
    Most of the questions TSA receives concerning preemption involve 
the definition of ``conviction'' and whether the State definition or 
the definition set forth in TSA's rule applies. TSA's definition 
applies in the context of hazmat drivers, and TSA is amending it in 
this IFR to clarify the difference between State and Federal 
expungement standards. The new definition describes what actions 
constitute an expungement for purposes of the rule and serve to nullify 
a conviction. By providing the new definition, TSA believes that many 
of the questions concerning the application of State or Federal 
``conviction'' standards are now addressed.
    Some commenters have asked whether the TSA rule precludes a State 
from reviewing State criminal databases, in addition to the CJIS 
criminal records that TSA will search. Some States have stated that 
they plan to complete a check of the State records and forward any 
pertinent information to TSA with the other applicant information for 
consideration in the security threat assessment. Moreover, some States 
are required by State law to forward a driver's derogatory criminal 
history to TSA.
    TSA's rule neither requires a State to search nor prevents a State 
from searching its own criminal records. If a State has the resources 
to check State criminal history records and forward any pertinent 
information to TSA during an applicant's security threat assessment, 
TSA will use the information. The only caveat we must apply is the 
State record must be transmitted to TSA contemporaneously with the 
other applicant information that the State submits to TSA. Considering 
the volume of information that will be exchanged on 2.7 million 
drivers, TSA and the States must make every effort to keep an 
applicant's information consolidated. Also, the State must consult with 
TSA concerning an acceptable format it will use to transmit the State 
criminal records to make certain TSA staff can easily decipher the 
record.

F. Privacy Concerns

    Several drivers and employers commented on TSA's ability to 
maintain the confidentiality of a driver's identification information. 
Some drivers are skeptical that TSA can protect this personal 
information from use by other government agencies, commercial 
organizations, or employers. Employers

[[Page 68726]]

would like to receive some of the information that will be collected 
for the security threat assessment. TSA is sensitive to these issues 
and has established safeguards to ensure that all information will be 
handled in accordance with the Privacy Act of 1974.\15\
---------------------------------------------------------------------------

    \15\ 5 U.S.C. 552a, as amended.
---------------------------------------------------------------------------

    TSA employees and contractors are bound by law and contract to 
abide by Federal privacy laws to protect personal information from 
unauthorized disclosure. There are criminal sanctions for individuals 
who violate these laws. TSA has published its Privacy Act System of 
Records \16\ for this program, detailing the information to be 
collected, how it will be used, and the routine uses of that 
information. TSA's System of Records discussed above permits sharing 
information with employers in its routine uses section. The personal 
information will be password protected and secured against unauthorized 
access.
---------------------------------------------------------------------------

    \16\ 69 FR 57349 (September 24, 2004).
---------------------------------------------------------------------------

    As a matter of efficiency, TSA intends to maintain as much 
consistency as possible between the current hazmat driver and future 
maritime programs. The Maritime Transportation Security Act (MTSA)\17\ 
requires a security threat assessment of workers with unescorted access 
to secure areas of ports, maritime vessels, and facilities. MTSA 
provides that any information constituting the grounds for denial of a 
transportation worker identification card must be maintained 
confidentially by the Secretary; an individual's employer may be 
informed of whether or not the individual has been cleared.\18\ With 
respect to the hazmat program, any notification TSA makes to an 
employer will relay whether the driver's endorsement has been revoked 
so that the employer knows that the driver is not authorized to 
transport hazmat. Actual criminal history or other dispositive records 
will not be shared with employers. If TSA determines that an imminent 
threat exists and additional measures are necessary to secure a 
facility, TSA may provide additional information to the employer to 
help prevent a security incident.
---------------------------------------------------------------------------

    \17\ Pub. L. 107-295, November 25, 2002, 116 Stat. 2064.
    \18\ 46 U.S.C. 70105(e).
---------------------------------------------------------------------------

    It is also important to note that the FBI places restrictions on 
who may have access to the raw data obtained during a fingerprint-based 
CHRC. See 28 CFR 50.12. These restrictions would also apply to an 
employer's use of certain information.
    TSA is considering requiring all employers to maintain a list of 
employees who hold HMEs, so that in the event that TSA wishes to notify 
an employer that an employee is not authorized to transport hazmat, TSA 
will have the information necessary to contact the employer. TSA may 
require each employer to maintain this list on a secure website that 
TSA can access easily and to update the list periodically. TSA has 
similar requirements in place in aviation. For instance, each airport 
must maintain a current list of individuals who have unescorted access 
to secure areas of an airport, and conduct periodic audits to ensure 
that the list is accurate. 49 CFR 1542.211. TSA requests comments from 
the industry concerning methods to establish such a database that would 
impose the fewest burdens and costs. Also, TSA requests comments on 
additional measures that would be useful in protecting this information 
from unauthorized access.

G. Tiered Background Checks

    In one comment, an individual driver asked TSA to consider 
developing a tiered security threat assessment, with more stringent 
standards in place for the transportation of dangerous goods, such as 
weapon systems, chemical and biological warfare materials, and bulk 
fuels. Individuals who haul less dangerous products, such as asbestos, 
lithium batteries, food coloring, corn syrup, and bleach would undergo 
a security threat assessment, but with a shorter list of disqualifying 
offenses. TSA has discussed this principle internally for use across 
all modes of transportation. Under this approach, individuals with 
unescorted access to highly sensitive information, equipment, areas, or 
products would undergo a very intensive background check, and those 
with access to less sensitive material would complete a check of 
relevant criminal databases, particularly for outstanding wants and 
warrants, immigration status, and appropriate terrorist watch lists.
    The difficulty with this approach is that it increases the costs, 
time, and resources necessary to track a particular shipment through 
the transportation system and make certain that only individuals with 
the appropriate background check come in contact with the shipment. TSA 
and DOT faced this problem with explosives shipments. Manufacturers and 
shippers were not willing to ship explosives in commerce because the 
SEA was originally going to be implemented in such a way that no felon 
could transport the explosive. The industry understood that it would 
not be possible to know at one end of the shipment process who might 
handle the package before it reaches its destination. In the scenario 
the commenter proposes, a significant amount of time would have to be 
spent by the industry to ensure that a box of explosives entering the 
transportation system in California does not travel through the hands 
of an individual who had not completed the most stringent security 
threat assessment before it reaches Vermont.
    We note in this regard that the Current Rule, as amended by this 
IFR, provides for a tiered security threat assessment in that the 
driver background check requirements apply to drivers who transport 
``placarded'' amounts of hazardous materials and select agents. 
``Placarded'' amounts and materials are liquid, gaseous, or solid 
products that DOT has determined to be hazardous in transportation and 
require special marking and packaging while transported in commerce. 
(49 CFR part 172). In the May 5 IFR (68 FR 23832) TSA and DOT 
determined that the most significant security risks associated with the 
transportation of hazardous materials in commerce involve the 
transportation of certain radioactive materials, certain explosives, 
materials that are poisonous by inhalation, certain infectious and 
toxic substances, and bulk shipments of materials such as flammable and 
compressed gases, flammable liquids, flammable solids, and corrosives. 
This list generally correlates to the types and quantities of hazardous 
materials for which placarding is required. Using the placarding 
thresholds to trigger enhanced security requirements covers the 
materials that present the most significant security threats in 
transportation and provides a relatively straightforward way to 
distinguish materials that may present a significant security threat 
from materials that do not. It also provides consistency for the 
regulated community, thereby minimizing confusion and facilitating 
compliance.
    As the security programs administered by TSA mature, we intend to 
develop additional refinements to the process while maintaining a high 
level of security.

H. HME Transfers

    Several drivers and State agencies have requested different 
standards for HME holders who must transfer the HME to a new State of 
residence. They cite the difficulty a driver faces if he undergoes 
security threat assessments for example, in February 2005 in Virginia, 
and must complete a second security threat assessment if he moves

[[Page 68727]]

to another State in the following year. Based on calls TSA has 
received, some drivers transfer State domicile and driver's licenses 
frequently. These transfers can become very costly for the driver or 
his employer, and impose additional work on the State DMVs and TSA. 
Therefore, TSA is amending the rule to permit the States and a transfer 
HME applicant to complete one security threat assessment for the period 
of time required in the driver's original State of issuance. For 
example, a driver in State A, where the renewal period is every four 
years, who completes a security threat assessment in 2005 and then 
moves to State B, will not have to complete a second threat assessment 
until the State A assessment expires in 2009. FMCSA's regulations 
require renewing the HME at least once every five years, so drivers 
across the country have nearly identical renewal periods. 49 CFR 
383.141(d). Thus, there is no risk that any driver will go more than 
five years without a security threat assessment.
    TSA invites comment from industry and the States on this new 
standard. TSA anticipates that the States will have to amend internal 
recordkeeping practices to track the HME transfer applicants, but we 
believe based on the comments received from the States that this is 
preferable to initiating a new security threat assessment each time an 
HME holder transfers to a new State.

I. Applicability of Waivers to Sec.  1572.107 Disqualifications

    An organization submitted comments asking TSA to reconsider the 
disqualifications from eligibility for a waiver under Sec.  1572.107. 
TSA does not permit applicants who are disqualified under Sec.  
1572.107 to apply for a waiver. First, disqualifications under 
paragraph 1572.107(a) generally are a result of the intelligence-
related check and reveal that the applicant may have or has connections 
to terrorist activity, leading to the determination that the applicant 
poses a security threat. Once an applicant is determined to pose a 
security threat due to intelligence-related information, there can be 
no rational reason to grant him a waiver of the standards. Further, 
disqualifications under paragraphs 1572.107(a) or (b) are based on 
individual determinations that, based on all of the circumstances, the 
applicant poses a threat. This scenario is unlike situations under 
Sec.  1572.103, in which applicants are disqualified based on a certain 
criminal history, but where the circumstances surrounding the crime or 
rehabilitation following conviction might warrant issuing a waiver. 
Because individual circumstances are taken into account under a 
determination based on Sec.  1572.107, there is no reason for a waiver.
    Applicants disqualified under Sec.  1572.107 may appeal TSA's 
initial determination that the applicant may pose a security threat on 
the grounds that TSA's assessment is inaccurate (e.g., due to mistaken 
identity). If TSA is not persuaded that the appeal should be granted, 
there is no opportunity for a waiver. TSA is changing this section of 
the rule to heighten the level of scrutiny that the applicant's appeal 
will receive. The rule now requires that the Assistant Secretary, 
rather than the Director, review and make a final determination of 
appeals that arise under Sec.  1572.107 of the rule.

J. Hazmat Endorsements for Certain Farmers

    Some States have asked whether individuals engaged in farming, who 
are subject to certain exceptions in the FMCSA and RSPA rules, must 
undergo a security threat assessment. Farmers are not required to 
obtain a commercial drivers license if they operate their vehicles 
within a 150-mile radius of the farm. If they transport materials that 
must be placarded, they must obtain a farm hazmat endorsement, which is 
attached to a basic operator Class D license. To obtain this 
endorsement, the driver must pass the regular CDL hazmat written test 
and a driving test in a representative vehicle.
    These drivers are not required to undergo a security threat 
assessment for an HME because they are not required to obtain a CDL. 
The requirements in Sec.  1012 of the USA PATRIOT Act are specific to 
the hazardous materials endorsement on a commercial drivers license. 
TSA may determine in the future that this population should undergo 
some form of a security threat assessment under the provisions of the 
Aviation and Transportation Security Act.\19\ However, TSA is not 
amending this rule to cover this group, because the rule applies to the 
States and holders of commercial drivers licenses.
---------------------------------------------------------------------------

    \19\ 49 U.S.C. 114.
---------------------------------------------------------------------------

K. Acceptance of Background Checks Conducted by Other Agencies

    TSA has received inquiries concerning the acceptance of background 
checks completed by other public and private entities. They urge TSA to 
recognize these checks as comparable to the security threat assessment 
required in this rule to avoid duplication of effort and unnecessary 
cost. Consistent with Homeland Security Presidential Directive-11 on 
comprehensive terrorist-related screening procedures and Homeland 
Security Presidential Directive-12 on common identification standards, 
TSA is committed to ``standardizing'' the security threat assessment 
process to the fullest extent possible. TSA will continue to work with 
all appropriate Federal agencies to ensure comparable background checks 
and threat assessments to avoid duplication of effort and minimize 
costs. TSA also recognizes that broader Federal Government efforts are 
underway to develop standardized screening for multiple programs across 
the Federal Government and the private sector. As these procedures are 
developed and implemented government-wide, TSA will consult with other 
Federal agencies to provide reciprocity with respect to comparable 
security screening programs.

VI. Summary of This Interim Final Rule

    This document published today (referred to throughout the remainder 
of this document as the IFR) restructures the Current Rule text for 
clarity and organization. The chart below provides the section number 
in the Current Rule and the corresponding new section number used in 
this IFR.

------------------------------------------------------------------------
              Old section                          New section
------------------------------------------------------------------------
1572.5(b)..............................  1572.11
1572.5(c)..............................  1572.13(a)-(d)
1572.5(d)(1)...........................  1572.5(c)
1572.5(d)(2)...........................  1572.5(b)
1572.5(e)..............................  1572.9
1572.5(f)..............................  1572.103
1572.5(g)..............................  1572.15(d)(1)
1572.9.................................  1572.201
1572.11................................  1572.203
------------------------------------------------------------------------

    This IFR changes the Current Rule by amending the security threat 
assessment procedures into three distinct phases: the fingerprint-based 
check, the intelligence-related check, and the final disposition. As 
the Current Rule requires and under this IFR, TSA adjudicates the 
results of the fingerprint- and intelligence-related checks. As 
provided in this IFR and the Current Rule, after adjudication, TSA 
issues a Determination of No Security Threat to the State if the 
records do not disclose disqualifying information. TSA issues an 
Initial Determination of Threat Assessment to the applicant if the 
results of the threat assessment reveal a disqualifying standard. The 
applicant may file an appeal of the Initial Determination with TSA, 
based on assertions that the underlying records are incorrect or the 
records refer to a different individual. After completion of

[[Page 68728]]

an appeal, TSA issues a Final Disposition based on the results of the 
security threat assessment and appeal. Under the Current Rule and this 
IFR, TSA administers a waiver program for individuals who do not meet 
the standards for mental competency or criminal history, but can show 
rehabilitation to such an extent that they are capable of holding an 
HME.
    In the IFR, TSA is making the following changes to the Current 
Rule:
    <bullet> Revise definitions and terms in the rule text to describe 
the security threat assessment process
    <bullet> Reorganize the rule text so that it is easier to follow
    <bullet> Amend the immigration standards to permit lawful 
nonimmigrants, refugees, and asylees who possess valid evidence of 
unrestricted employment authorization who are qualified to hold a CDL 
to apply for a security threat assessment for an HME
    <bullet> Remove simple possession of a controlled substance from 
the list of disqualifying offenses
    <bullet> Reclassify arson as an interim rather than a permanently 
disqualifying offense
    <bullet> Add unlawful purchase, receipt, transfer, shipping, 
transporting, import, export and storage of a firearm or explosive or 
explosive device to the list of disqualifying offenses
    <bullet> Reclassify murder as a permanently rather than an interim 
disqualifying offense
    <bullet> Make RICO convictions permanently disqualifying if the 
predicate crimes are permanently disqualifying
    <bullet> Add the specific statutory citation for the offense of 
improper transportation of hazmat
    <bullet> Lengthen the suspense dates in the appeal and waiver 
processes
    <bullet> Reduce the amount of advance notice the States must 
provide HME drivers about the need for a background check upon renewal
    <bullet> Amend the standards for drivers who are transferring their 
HME to a new State so that they do not have to undergo a new security 
threat assessment until the time period established by the State under 
which the driver's current security threat assessment expires
    <bullet> Amend the review process for drivers who are disqualified 
as a result of the intelligence-related check to provide a final 
determination by the Assistant Secretary rather than the Director
    <bullet> Remove the requirement that the States must forward each 
driver application to TSA
    <bullet> Require the States to retain the application for one year
    <bullet> Prohibit applicants with certain conviction from applying 
for a waiver
    <bullet> Delay the date on which States are required to begin the 
security threat assessment process for renewals and transfers
    <bullet> Require electronic submission of the applicant information 
in States that elect to do the fingerprint collection
    <bullet> Require the States to notify TSA as to whether the State 
elects to collect and submit applicant information and fingerprints, or 
whether the State wants TSA do the collection
    Each of these changes is discussed in detail in the preamble of 
this IFR.

VII. Rulemaking To Establish Fees

    Section 1572.13(f) of the IFR provides that each State must decide 
whether it wants TSA and its agent to collect applicant information, 
fingerprints, and fees, and inform TSA of the decision no later than 
December 27, 2004.
    The USA PATRIOT Act did not grant TSA authority to collect fees to 
cover the costs associated with completing security threat assessments 
on hazmat drivers. However, on October 1, 2003, legislation was enacted 
requiring TSA to collect reasonable fees to cover the costs of 
providing credentialing and background investigations in the 
transportation field, including implementation of the USA PATRIOT Act 
requirements.\20\ Section 520 of the Homeland Security Appropriations 
Act of 2004 (2004 Appropriations Act) requires TSA to collect fees to 
pay for the costs of the following: (1) Conducting or obtaining a 
criminal history records check (CHRC); (2) reviewing available law 
enforcement databases, commercial databases, and records of other 
governmental and international agencies; (3) reviewing and adjudicating 
requests for waivers and appeals of TSA decisions; and (4) any other 
costs related to performing the background records check or providing 
the credential.
---------------------------------------------------------------------------

    \20\ Department of Homeland Security Appropriations Act, 2004, 
section 520, Pub. L. 108-90, October 1, 2003, 117 Stat. 1137.
---------------------------------------------------------------------------

    Section 520 requires that any fee collected must be available only 
to pay for the costs incurred in providing services in connection with 
performing the background check or providing the credential. The fee 
may remain available until expended. TSA must establish this fee in 
accordance with the criteria in 31 U.S.C. 9701 (General User Fee 
Statute), which requires fees to be fair and based on (1) costs to the 
government, (2) the value of the service or thing to the recipient, (3) 
public policy or interest served, and (4) other relevant facts. To the 
extent possible, TSA intends for these fees to be relatively consistent 
for other TSA background check programs.
    In this IFR, TSA is requiring States to choose between two 
fingerprint collection options. Each State must either: (1) Collect and 
transmit the fingerprints and applicant information of individuals who 
apply for or renew an HME; or (2) allow an entity approved by TSA (TSA 
agent) to collect and transmit the fingerprints and applicant 
information of such individuals. States are required to notify TSA in 
writing of their choice within 30 days after the date this IFR is 
published in the Federal Register. If a State does not notify TSA in 
writing of its choice by that date, TSA will assume that the State has 
chosen the second option and will work with the State to establish a 
system for a TSA agent to collect fingerprints and applicant 
information in the State.
    The State will be required to operate under the option it chooses 
until at least January 31, 2008, unless otherwise approved by TSA. TSA 
is requiring a specific initial time period of three years so that TSA 
and the TSA agent can adequately assess the overall cost of 
implementing the program. The fingerprint portion of the threat 
assessment will be effectively staggered initially as new applicants 
apply for the first time and as existing HME holders apply to renew 
their endorsement. If the States could change position on a yearly 
basis, the TSA agent would make its initial contract bid based on 
inaccurate cost projections. With a specific time period, the TSA agent 
can estimate with more certainty how many applicants must be processed, 
how much equipment is needed, where the collection centers will be 
located, and the number of employees needed to carry out the collection 
tasks.
    To comply with the mandates of Section 520 of the 2004 
Appropriations Act, the USA PATRIOT Act, and the SEA, TSA is issuing a 
companion notice of proposed rulemaking (Fee NPRM) to establish user 
fees for individuals who apply to obtain or renew an HME, and thus are 
required to undergo a security threat assessment in accordance with 49 
CFR part 1572. In the Fee NPRM, TSA proposes to establish two new user 
fees in addition to the FBI fee for performing the CHRC on behalf of 
government agencies for non-governmental applicants: (1) A fee to cover 
TSA's costs of performing and adjudicating security threat assessments, 
appeals, and waivers (Threat Assessment Fee); and (2) a fee to cover 
the costs of collecting and transmitting fingerprints and applicant 
information (Information Collection and Transmission Fee).

[[Page 68729]]

    Under the Fee NPRM, if a State opts to collect fingerprints and 
applicant information itself, the State would be required to (1) 
collect and remit to TSA the Threat Assessment Fee in accordance with 
the requirements of the Fee NPRM and (2) collect and remit to the FBI 
its user fee to perform a criminal history records check. The State 
then would be free to collect a fee under State law, such as to cover 
its costs of collecting and transmitting fingerprints and applicant 
information.
    If a State opts to permit a TSA agent to collect and transmit 
fingerprints and applicant information, the State would not be required 
to collect and remit to TSA any fees under the Fee NPRM. Rather, a TSA 
agent would (1) collect and remit to TSA the Threat Assessment Fee and 
FBI fee; and (2) collect the Information Collection and Transmission 
Fee (which TSA will use to pay the agent for its services). TSA will 
remit to the FBI the appropriate FBI fee.

VIII. Section-by-Section Analysis

Section 1572.3 Terms Used in This Part

    Section 1572.3 adds and revises definitions of terms used 
throughout part 1572. The term ``adjudicate'' is added to describe the 
process by which an individual's security threat assessment is analyzed 
to determine whether the individual meets the security threat 
assessment standards. When TSA receives the results of the fingerprint- 
and intelligence-related checks, TSA analyzes the information for 
criminal history, immigration status, mental competency, and 
connections to terrorist activity to determine if the applicant should 
be disqualified under the standards described in this rule. The process 
of making this determination is the adjudication process.
    ``Alien'' means a person not a citizen or national of the United 
States. This definition is consistent with the definition of that term 
provided in the USA PATRIOT Act, which defines ``alien'' by referring 
to the definition provided in section 101(a)(3) of the Immigration and 
Nationality Act (INA). Section 101(a)(3) of the INA defines ``alien'' 
as any person not a citizen or national of the United States.
    The Current Rule permits lawful permanent residents and U.S. 
citizens to hold an HME after successfully completing TSA's security 
threat assessment. This IFR expands the group of potential HME holders 
to include lawful nonimmigrants, refugees, and asylees who possess 
valid, unrestricted evidence of employment authorization, so long as 
they meet the threshold requirement of being qualified to hold a CDL. 
TSA is making this change in response to comments received from the 
States, trucking companies, and individual drivers. Many are concerned 
that prohibiting aliens who are in the United States working lawfully 
from transporting hazardous materials will adversely impact the 
movement of commerce in areas where the concentration of non-citizens 
is high.
    TSA has evaluated the potential risks associated with this change 
and determined that it will not adversely impact security. Almost all 
of these individuals undergo background and security checks before 
obtaining lawful immigration status. Then, they will be subject to the 
full security threat assessment TSA conducts, which includes a variety 
of international sources, before being authorized to hold an HME. TSA 
has determined that, based on these facts and the high level of 
industry interest in permitting certain aliens to transport hazardous 
materials, the potential security risks have been effectively addressed 
and these individuals should be permitted to transport hazmat. This 
decision is discussed in greater detail in TSA's response to comments 
received.
    ``Alien registration number'' means the number issued by DHS to an 
individual when he or she becomes a lawful permanent resident or 
attains other non-citizen status. We are adding ``or attains other non-
citizen status'' to account for the fact that we are now permitting 
other non-citizens to apply for a hazmat endorsement.
    TSA is adding the term ``applicant'' to mean an individual who 
applies to obtain, renew or transfer an HME. Regardless of which phase 
the individual is in, the term ``applicant'' can be used to accurately 
describe the individual for ease of reference.
    We are adding a definition for the term ``Assistant Secretary'' in 
this IFR, because of a slight difference in the IFR concerning which 
TSA official makes final determinations of appeals and waivers. In this 
IFR, only the Assistant Secretary, TSA's highest ranking official or 
his or her appointed designee, can make a final determination on the 
appeal of a disqualification under Sec.  1572.107. Due to the fact that 
the information used for these checks may be classified, and therefore 
not available to the applicant for review, TSA believes that it is 
appropriate to provide a high level of scrutiny on these final 
determinations.
    The terms ``commercial driver's license'' and ``endorsement,'' are 
used here as defined in the Current Rule and in FMCSA's regulations at 
49 CFR 383.5. We are not making any changes to these definitions.
    TSA is changing the definition of ``convicted'' in this rule. In 
the Current Rule, convicted means any plea of guilty or nolo 
contendere, or any finding of guilt. Under the IFR, TSA will include 
the effect that a reversal, pardon, or expungement has on a conviction. 
Each of these actions nullifies the conviction for purposes of 
determining whether an applicant meets the security threat standards. 
It is important to note that the definition also explains what an 
effective expungement is. For purposes of complying with this rule, the 
expungement must remove the criminal record from the applicant's file 
and cannot impose any restrictions or disabilities on the applicant. 
Also, if the applicant is permitted to withdraw a guilty plea or plea 
of nolo contendere and the case is dismissed, the individual is no 
longer considered to have a conviction. TSA believes it is necessary to 
include this level of detail in the definition to ensure that 
applicants are treated consistently across the country. Procedures on 
expungements vary from state to state, and may change at any time. 
Therefore, TSA hopes to avoid inconsistent application of the law 
against hazmat drivers by providing the new definition.
    We are making three changes to the definition of ``date of 
service'' in Sec.  1572.3. In the Current Rule, date of service is the 
date of personal delivery; the mailing date shown on a certificate of 
service; the date shown on the postmark if there is no certificate of 
service; another mailing date shown by other evidence if there is not 
certificate of service or postmark; or the date of an e-mail showing 
when the document was sent. We are changing ``e-mail'' to ``electronic 
transmission'' to reflect more accurately the type of information 
exchange that will likely occur among the States, TSA, and TSA's agent. 
In addition, we are replacing ``the date shown on the postmark if there 
is no certificate of service'' with ``10 days from the date of mailing, 
if there is no certificate of service.'' TSA believes that this change 
is more reasonable, considering the fact that many drivers are away 
from home for at least a week and may not have enough time to initiate 
an appeal without this change. Finally, we are changing the language 
for circumstances where a document is mailed and there is no 
certificate of service. In these cases, date of service is the date on 
which the document is mailed to the mailing address designated by the 
applicant on the application. TSA makes this change to

[[Page 68730]]

underscore that TSA considers the information the applicant puts on the 
application as accurate and will rely on it for service of documents.
    The term ``day'' used in the rule means calendar day and is the 
same definition used in the Current Rule.
    ``Determination of No Security Threat'' is an administrative 
determination by TSA that an individual does not pose a security threat 
that warrants denial of the authorization to transport hazardous 
materials. Also, TSA will issue a Determination of No Security Threat 
to the State when TSA issues a waiver. This term is a replacement for 
``Notification of No Security Threat'' that is used in the Current 
Rule, but has the same meaning. TSA will use ``determination'' in place 
of ``notification'' throughout the definitions.
    The term ``Director'' refers to the officer designated by the 
Assistant Secretary to administer the appeal and waiver programs 
described in this part, unless the Assistant Secretary is specifically 
designated in the rule to administer the appeal or waiver program. The 
Director is authorized to name a designee to perform these duties, 
except where the IFR specifically designates the Assistant Secretary to 
administer the appeal or waiver program.
    TSA is adding a definition of explosive or explosive device, which 
includes an explosive or explosive material defined in 18 U.S.C. 
232(5), 841(c)-(f), and 844(j), and a destructive device defined in 18 
U.S.C. 921(a)(4) and 26 U.S.C. 5845(f). The addition of this definition 
does not alter the substance of the rule in any way; it simply provides 
clarity for individuals looking for guidance on the items that 
constitute an explosive. The list is illustrative, not exhaustive.
    ``Final Determination of Threat Assessment'' means a final 
determination by TSA that an individual does not meet the standards 
required to hold or obtain a hazardous materials endorsement. A Final 
Determination may not be administratively appealed. In the Current 
Rule, this action is referred to as a Final Notification of Threat 
Assessment. We are changing ``notification'' to ``determination'' to 
reflect more accurately the action being taken.
    ``Final Disposition'' is a new term in the IFR that describes the 
actions that must be taken when a security threat assessment is 
complete.
    TSA is adding a definition of ``firearm or other weapon,'' which 
includes firearms defined in 18 U.S.C. 921(a)(3) or 26 U.S.C. 5845(a) 
or items contained on the U.S. Munitions Import List at 27 CFR 447.21. 
The addition of this definition does not alter the substance of the 
rule in any way; it simply provides clarity for individuals looking for 
guidance on the items that constitute an explosive. The list is 
illustrative, not exhaustive.
    A ``hazardous material'' means any material that: (1) In accordance 
with Federal hazardous materials transportation law (49 U.S.C. 5101 et 
seq.), has been determined to pose an unreasonable risk to health, 
safety, and property when transported in commerce and that is required 
to be placarded under subpart F of part 172 of the Hazardous Materials 
Regulations (49 CFR parts 171-180); or (2) any quantity of any material 
listed as a select agent or toxin by Centers for Disease Control and 
Prevention (CDC) in 42 CFR part 73. This is the same definition used in 
section 103 of the Hazardous Materials Transportation Act and in the 
Current Rule.
    DOT evaluates materials to determine whether their respective 
characteristics, properties, and quantities in transportation merit 
special marking, storage, and handling procedures. TSA, in consultation 
with DOT, has determined that non-placarded shipments do not present a 
sufficient security risk in transportation to warrant application at 
this time of the TSA background check requirements to persons who 
possess or transport these materials, including persons subject to 18 
U.S.C. 842(i).
    ``Hazardous materials endorsement (HME)'' is the authorization 
issued by a State Department of Motor Vehicles (DMV) to transport 
hazardous materials in commerce. An HME attaches to a truck driver's 
commercial driver's license (CDL), which is also issued by a State DMV.
    ``Incarceration'' means confinement to a jail, half-way house, 
treatment facility, or other institution, on a full or part-time basis 
pursuant to a sentence imposed due to a conviction. This definition is 
taken from a statutory definition of ``imprisoned'' in 22 U.S.C. 2714, 
which relates to denial of passports due to certain drug offense 
convictions. It is the same as the definition used in the Current Rule. 
We have used this definition of incarceration because it is used in 
similar Federal regulatory programs, such as those involving the 
issuance or approval of passports. See 5 CFR 890.1003; 42 CFR 1001.2.
    TSA is adding a definition for ``imprisoned or imprisonment,'' 
which is a new term used in Sec.  1572.107. It means confined to a 
prison, jail, or institution for the criminally insane, on a full-time 
basis pursuant to a sentence imposed as the result of a criminal 
conviction or finding of not guilty by reason of insanity. Time spent 
confined or restricted to a half-way house, treatment facility, or 
similar institution pursuant to a sentence imposed as the result of a 
criminal conviction or finding of not guilty by reason of insanity does 
not constitute imprisonment for purposes of this rule. TSA added this 
term to cover instances in which we believe time spent in a half-way 
house or treatment facility should not be relevant to determining 
whether a driver poses a security threat.
    ``Initial Determination of Threat Assessment'' means an initial 
administrative determination by TSA that an individual poses a security 
threat that warrants denial of the authorization to transport hazardous 
materials. An Initial Determination may be administratively appealed. 
We are changing this term to ``Initial Determination'' from ``Initial 
Notification,'' to reflect more accurately the action being taken. In 
addition, the words ``the authorization for which the individual is 
applying'' have been deleted to make the language clearer.
    ``Initial Determination of Threat Assessment and Immediate 
Revocation'' means an initial administrative determination that an 
individual poses a security threat that warrants immediate revocation 
of an HME. Upon issuance of this document, the State must immediately 
revoke the hazmat endorsement. The driver has an opportunity to appeal 
this determination, but the appeal transpires after the revocation has 
occurred. TSA will issue this document only where we believe the driver 
may pose an imminent threat to transportation, national security, or 
other individuals. We are adding this definition to distinguish the 
notification documents used in an immediate revocation from the more 
common Initial Determination process.
    ``Lawful permanent resident'' means an individual who has been 
lawfully admitted for permanent residence in the United States, as 
defined in 8 U.S.C. 1101. In the statute, ``lawfully admitted for 
permanent residence'' means ``the status of having been lawfully 
accorded the privilege of residing permanently in the United States as 
an immigrant in accordance with the immigration laws, such status not 
having changed.'' The language in this definition has been changed 
slightly from the Current Rule,

[[Page 68731]]

but substantively, the meaning is the same.
    ``Mental institution'' means a mental health facility, mental 
hospital, sanitarium, psychiatric facility, and any other facility that 
provides diagnoses by licensed professionals of mental retardation or 
mental illness, including a psychiatric ward in a general hospital. 
This definition is taken from standards concerning individuals with a 
mental disability, which ATF promulgated at 27 CFR 478.11. This 
definition is the same one used in the Current Rule. We are using this 
ATF definition because we are implementing standards concerning mental 
capacity and the authorization to transport explosives and other 
hazmat, which ATF previously administered before TSA published the 
Current Rule.
    The term ``pilot state'' is defined here as a State that chooses to 
volunteer to begin the complete security threat assessment process 
prior to January 1, 2005. This definition is used in the Current Rule.
    ``Revoke'' means the process by which a State cancels, rescinds, 
withdraws or removes a hazardous materials endorsement. This definition 
is revised to include all terms a State may have in its statute that 
are equivalent to the term ``revoke.'' Several States commented that 
the local statute does not use ``revoke'' and asked that we include 
other terms consistent with the State statute to ensure that a State 
does not violate its own statute when it revokes or rescinds a 
hazardous materials endorsement. TSA's interest is in the cessation of 
a driver's right to carry hazardous materials, and not to impact the 
driver's ability to maintain his commercial drivers license.
    ``State'' means a State of the United States and the District of 
Columbia. This definition is taken from The Commercial Motor Vehicle 
Safety Act of 1986, 49 U.S.C. 31301(14), which created the CDL program. 
This has not changed from the Current Rule.
    ``Transportation security incident'' means a security incident 
resulting in a significant loss of life, environmental damage, 
transportation system disruption, or economic disruption in a 
particular area. This definition is taken from the Maritime 
Transportation Security Act (MTSA) (46 U.S.C. 70101). This definition 
has the same meaning as the definition used in the Current Rule, but is 
now consistent with the actual legislative language. TSA used ``severe 
transportation security incident'' in the Current Rule to make clear 
that the incident must result in significant damage, disruption, or 
loss of life to be a disqualifying offense in the hazmat program. TSA 
is making the change to use the actual legislative language to make the 
IFR consistent with the statute.
    ``Withdrawal of Initial Determination of Threat Assessment'' is the 
document TSA issues to an applicant when the security threat assessment 
process initially indicates that an applicant may pose a security 
threat, but on appeal, TSA determines that the person does not pose a 
security threat. For instance, mistaken identity or incomplete court 
records may have led to an incorrect initial determination.

Section 1572.5 Scope and Standards for Hazardous Materials Endorsement 
Security Threat Assessment

    This section describes the individuals and entities subject to the 
requirements in Subpart A and the standards those individuals must 
meet.
    Subpart A applies to State agencies that are responsible for 
issuing commercial drivers licenses and HMEs, and applicants who hold 
or apply for a new, renewal or transfer HME.
    The standards TSA applies to determine whether an individual poses 
or is suspected of posing a security threat that warrants denial of an 
HME have been established by statute, the USA PATRIOT Act and the Safe 
Explosives Act. For the purposes of this IFR, an applicant does not 
pose a security threat if he or she (1) does not have a disqualifying 
criminal offense described in Sec.  1572.103; (2) meets the immigration 
status requirements described in Sec.  1572.105; (3) does not pose a 
security threat as described in Sec.  1572.107; and (4) has not been 
adjudicated as lacking mental capacity as described in Sec.  1572.109. 
This paragraph also explains that the security threat assessment will 
be based on the individual's fingerprints, name, and other identifying 
information.

Section 1572.7 Waivers of Hazardous Materials Endorsement Security 
Threat Assessment Standards

    This section describes the individuals who may apply to TSA for a 
waiver. Applicants who have been convicted of certain criminal offenses 
and those who have been declared mentally incompetent in the past may 
apply for a waiver. Individuals convicted of treason, sedition, 
espionage, a crime involving a transportation security incident, and a 
crime of terrorism are not eligible for a waiver from TSA. This is a 
change from the Current Rule, which TSA believes is appropriate given 
the severity and level of risk these crimes reflect. Individuals who do 
not meet the immigration standards in Sec.  1572.105 may not apply for 
a waiver. There is no circumstance or set of facts under which TSA 
would wish to suspend the application of the lawful immigration 
categories listed in section 105 to issue a waiver. Additionally, if 
TSA determines that an individual does not meet the standards in Sec.  
1572.107, the applicant is not eligible for a waiver. Granting a waiver 
to an individual determined to pose a security threat would undermine 
the purpose of this rule and the statutes that gave rise to it.

Section 1572.9 Applicant Information Required for a Security Threat 
Assessment for a Hazardous Materials Endorsement

    This section describes all of the identifying information an 
applicant must provide in order for TSA to complete the fingerprint- 
and intelligence-related checks. The State is required to retain the 
information for one year, in either paper or electronic form. If the 
State opts to collect fingerprints and the applicant information, the 
State must submit applicant information to TSA electronically and the 
fingerprints to the FBI. If the State chooses to have TSA do the 
collection, the TSA agent will collect and retain the information, 
provide a copy of the application to the State, and submit the 
fingerprints to the FBI. We are requiring essentially the same 
information as is required in Sec.  1572.5(e) of the Current Rule, but 
we now add the requirement to provide the applicant's physical 
identifying information, including hair and eye color, height and 
weight. Also, we are now requiring the applicant's mailing address, if 
it differs from the residential address, to facilitate delivering all 
notifications to the proper location. Finally, we are requesting the 
name and address of the applicant's current employer(s) so that TSA can 
notify the employer if a driver poses a security threat and is no 
longer authorized to transport hazmat.
    This section also requires the applicant to acknowledge and certify 
that he or she meets the standards described in the application and 
does not have any of the disqualifying offenses. The applicant's 
certification is given under penalty of law-- any false statement or 
misrepresentation may result in criminal prosecution.

Section 1572.11 Applicant Responsibilities for a Security Threat 
Assessment for a Hazardous Materials Endorsement

    This section describes the standards with which each applicant must 
comply and the actions the applicant must take

[[Page 68732]]

in order to hold an HME. The requirements in this section are found in 
Sec.  1572.5(b) of the Current Rule. As of September 2, 2003, current 
HME holders have been required to surrender the endorsement if the 
individual does not meet the standards described in the Current Rule. 
Also, applicants have an ongoing responsibility to report any violation 
of the standards to TSA and surrender the HME within 24 hours of the 
violation. Paragraph (d) of this section provides that the applicant 
may submit fingerprints to prove identity or disprove an adverse 
finding following the intelligence-related check, and must submit 
fingerprints when applying to obtain or renew an HME. With respect to 
transferring an HME when a driver changes residences, the driver is not 
required to undergo a security threat assessment in the new State until 
the term of years required in the driver's previous State of residence 
expires.
    On October 1, 2003, legislation was enacted requiring TSA to 
collect reasonable fees to cover the costs of providing credentialing 
and background investigations in the transportation field, including 
implementation of the USA PATRIOT Act requirements.\21\ As a result, 
TSA has initiated a proposed rulemaking to determine the reasonable 
fees that are necessary to cover each phase of TSA's security threat 
assessment. Paragraph (d)(3) refers to this fee authority and states 
that the fee TSA may charge in order to cover the cost of the security 
threat assessment must be paid by the employee or employer. It is 
important to note that this does not refer to any fees the States may 
charge to recover their costs, or the fees that the FBI has established 
to complete the search.
---------------------------------------------------------------------------

    \21\ 2004 Department of Homeland Security Appropriations Act, 
Section 520, Pub. L. 108-90, October 1, 2003, 117 Stat. 1137.
---------------------------------------------------------------------------

Section 1572.13 State Responsibilities for Issuance of Hazardous 
Materials Endorsement

    This section lists all of the responsibilities that the States must 
perform in order to ensure that only individuals who meet the security 
threat assessment standards receive a hazmat endorsement. These 
requirements are very similar to the requirements in the Current Rule.
    Paragraph (a) provides that each State must immediately revoke an 
individual's hazardous materials endorsement if TSA informs the State 
that the individual does not meet the standards for security threat 
assessment in Sec.  1572.5. This provision is intended to address 
situations in which TSA becomes aware of an individual who may pose an 
immediate threat and should not be transporting hazardous materials. 
TSA envisions that this procedure will not occur frequently, but the 
States must be prepared to revoke an HME quickly if such an individual 
comes to TSA's attention. Any individual HME holder who falls into this 
category may appeal this action, as described in Sec.  1572.141(i).
    Paragraph (b) provides that as of January 31, 2005, for new HMEs 
and on May 31, 2005, for renewal and transfer HMEs, no State may issue 
or renew an HME for a CDL unless the State receives a Determination of 
No Security Threat from TSA. This IFR provides the later date for HME 
renewals and transfers in recognition of the States' need for 
additional time and resources to implement this program. TSA has 
completed a name-based check on all current HME holders and reruns this 
list periodically. TSA has disqualified those individuals that pose a 
security threat. Therefore, TSA has determined that staggering the 
implementation should not adversely impact security.
    In addition, at least 60 days prior to the expiration date of the 
individual's endorsement, the State must notify each individual holding 
a hazardous materials endorsement issued by that State that he or she 
will be subject to the security threat assessment described in this 
part as part of an application for renewal of the endorsement. The 
notice must inform the individual that he or she may initiate the 
security threat assessment required by this part at any time after 
receiving the notice, but no later than 30 days before the expiration 
date of the individual's endorsement. If the individual does not 
initiate the security threat assessment at least 30 days before the 
expiration, their HME may expire before the security threat assessment 
is complete.
    The timelines described in paragraph (b) have been shortened from 
the 180/90-day notification deadlines in the Current Rule as a result 
of comments received from the States and TSA's reconsideration of this 
requirement. Initially, TSA established the 180/90-day notification 
requirements in order to provide HME holders sufficient time to seek 
other employment if they believe they may be disqualified. However, now 
that the driver self-reporting requirement in Sec.  1572.11 is in 
effect (as of September 2, 2003) those drivers must surrender their 
endorsement and may seek a waiver under Sec.  1572.143.
    Representatives of the trucking industry have expressed concern 
that shortening this advance notice time period from 180 days to 60 may 
not provide drivers enough time to complete the security threat 
assessment before the HME expires. If a driver begins the assessment 60 
days prior to expiration of his HME, but receives an adverse initial 
finding, appeals it and then applies for a waiver, companies fear that 
drivers will not be available to transport hazmat because the HMEs will 
expire prior to completion of the appeal and waiver processes. Nothing 
in the rule prohibits the State, employer, or driver from beginning the 
security threat assessment more than 60 days prior to expiration of the 
HME. If a State, driver, or employer wishes to start the process 
earlier, they may do so.
    In addition, TSA is adding paragraph (b)(3), which provides that 
the States may not begin processing renewal and transfer applicants 
prior to March 31, 2005'60 days before the fingerprint start date for 
renewal and transfer applicants. TSA is adding this requirement to 
ensure that TSA and State resources will be focused on new applicants 
as the nationwide implementation begins. TSA believes this requirement 
may minimize process, paperwork, and computer problems that are more 
likely to occur when a program of this size first begins.
    Paragraph (c) provides that a State may volunteer to begin the 
security threat assessment program prior to January 31, 2005, if TSA 
approves the process the State intends to use. These Pilot States may 
not revoke, issue, renew or transfer a hazardous materials endorsement 
for a CDL unless the Pilot State: (1) collects the information required 
in Sec.  1572.9; (2) collects and submits fingerprints in accordance 
with procedures approved by TSA; and (3) receives a Determination of No 
Security Threat or Final Determination of Threat Assessment from TSA. 
This provision appeared in the Current Rule and is intended to address 
any State that is ready to proceed prior to January 2005.
    Paragraph (d) provides that a State may extend the expiration date 
of the HME for 90 days if TSA has not provided a Final Determination of 
Threat Assessment or Determination of No Security Threat before the 
endorsement expires. Any additional extensions must be approved in 
advance by TSA. This requirement appears in the Current Rule and TSA 
believes it is necessary to ensure that no applicant loses his or her 
HME due to unforeseen delays in the TSA or State process. For instance, 
if TSA or a State knows that a computer problem has developed that will 
delay a batch of background check data, the rule provides a mechanism 
for the State to extend the driver's HME. We are adding the 90-day 
extension limit in the IFR to ensure that an

[[Page 68733]]

applicant's HME is not extended indefinitely. TSA believes this time 
limit should also prevent miscommunication between TSA and the State. 
For instance, the State may send the appropriate information to TSA and 
assume TSA is conducting the security threat assessment, but the 
documents are lost or misidentified and the security threat assessment 
is not underway. Also, if TSA issues its Determination, but the State 
does not receive it for some reason, the rule requires communication 
between TSA and the State to resolve the delay.
    Paragraph (e) requires the State to update the driver's permanent 
record with the results of the security threat assessment and the new 
expiration date of the HME; notify CDLIS of the results; and revoke or 
deny the HME within 15 days after receiving TSA's Determination of No 
Security Threat or Final Determination of Threat Assessment. These 
actions include updating the applicant's record; notifying CDLIS of the 
results of the security threat assessment; and revoking or denying the 
HME based on the results of the check. The rule requires the States to 
take these actions within 15 days after receipt of the Final 
Determination of Threat Assessment or the Determination of No Security 
Threat.
    The IFR does not require the State to ``issue'' an HME within 15 
days when the applicant successfully completes the security threat 
assessment, as the Current Rule did. TSA received comments from many 
States and their Association concerning the extreme hardship this 
restriction would place on the current licensing systems. In the 
States' current CDL and HME issuance systems, the renewal periods and 
expiration dates are tied to the driver's date of birth. All of the 
States would be required to make major changes to computer systems that 
contain the CDL and HME data if the expiration date must be tied to the 
date of issuance rather than date of birth. Technically, the State can 
deliver the HME to the driver within 15 days after TSA's notification, 
but its expiration date would run from the driver's birth date, not the 
date of issuance, as required in the Current Rule. TSA has concluded 
that the expense and disruption these substantive changes would cause 
outweigh any advantage gained by having the expiration dates stem from 
the date of issuance rather than a driver's date of birth. TSA will 
monitor this process and take additional regulatory action if needed.
    New paragraph (f) provides that each State must notify TSA in 
writing as to whether the State wishes to have TSA collect and submit 
applicant information and fingerprints, or whether the State plans to 
undertake this responsibility. TSA must have each State declaration on 
or before December 27, 2004 and the declaration will remain in place 
until January 31, 2008, unless otherwise authorized by TSA. Throughout 
this rulemaking proceeding, approximately half of the States have 
indicated the desire to collect applicant fingerprints and information, 
and have the equipment, personnel, and funds to do so. Therefore, TSA 
is offering this choice to accommodate those State interests. For all 
other States, TSA, through an agent, will complete these tasks using 
TSA resources and the user fee collected for this purpose. The States' 
written declaration must be sent to the Hazmat Program Manager, TSA 
Credentialing Office, 601 S. 12th St., Arlington, VA 22202.
    For TSA to prepare adequately to oversee and administer the 
fingerprint collection process, and so that any TSA agent can 
accurately assess costs, TSA must know how many States will complete 
these collections and how many will opt for TSA to perform these 
responsibilities. To develop accurate cost estimates necessary to 
determine the user fee TSA will charge to the applicant or employer, 
TSA and its agent must assess start-up and operational costs over a 
period of time. Therefore, the selection each State makes will remain 
in place until January 31, 2008 unless otherwise authorized by TSA. TSA 
believes that a shorter time period is not adequate to assess 
implementation costs on how many collection sites are needed, how much 
equipment and personnel will be necessary, the time it will take to 
collect prints in the large versus small States, and other operational 
issues. Finally, if TSA does not receive a written declaration from a 
State, TSA and its agent will assume responsibility for the collection 
and submission process for that State.
    It is also important to note that if the State elects to collect 
applicant fingerprints and information, the State will gather the 
information that is required by the rule when the driver appears to 
provide fingerprints and initiate the process. The State must then 
forward the information to TSA electronically through CDLIS, the 
fingerprints to the FBI, and the corresponding fees to TSA and the FBI. 
As stated above, TSA is willing to assist with the electronic 
transmission of the information for a short period of time to give 
States enough time to upgrade their computer systems to perform 
electronic transfers routinely. TSA can devote resources to entering 
the data manually for a few months as long as the State is in the 
process of upgrading their system. If the State cannot complete the 
upgrade by July 2005, then the State should elect to have TSA capture 
fingerprints and information.
    If TSA's agent collects applicant information and fingerprints, TSA 
will require the TSA agent to collect and remit to TSA the FBI's fee 
and TSA's threat assessment fee, in a form and manner approved by TSA. 
Also, the FBI will bill TSA on a monthly basis for the fingerprints 
submitted by TSA through TSA's agent and processed by the FBI. This 
process is discussed in the fee NPRM as well.
    Depending on how many States elect to have TSA complete the 
fingerprint collection program and where they are located, drivers 
licensed in States that opt to have TSA collect fingerprints may be 
able to submit their fingerprints at any location where TSA has 
established a collection facility. For instance, if a driver in State A 
is working outside State A when it is time to submit fingerprints and 
information and State A elected to have TSA collect fingerprints, the 
driver may submit fingerprints at a TSA collection site that is much 
closer to where he is working at the time. In States that opt to do the 
collection, drivers will most likely have to submit the required 
information at a State collection point.
    As discussed earlier in this document, TSA is conducting a parallel 
proposed rulemaking to address the amount of the fee that TSA intends 
to charge for the security threat assessment. TSA encourages all 
interested parties to follow and participate in that proceeding to 
assist TSA in developing reasonable, accurate fees.
    TSA is adding a new paragraph (g) to this section in response to 
comments received from State DMVs and individual drivers concerning HME 
transfers. Pursuant to the FMCSA rules, drivers who change their State 
of residence must register with the new State of residence within 30 
days and apply for a transfer HME. 49 CFR 383.71(b). Drivers and the 
DMV offices questioned whether a new security threat assessment is 
necessary each time a driver moves to another State, regardless of when 
the previous threat assessment occurred. TSA agrees that requiring a 
new threat assessment each time a driver moves is burdensome and 
unnecessary. Therefore, the rule now permits a transferring HME holder 
to forego a new security threat assessment in the new State of 
residence until the

[[Page 68734]]

renewal period established in the preceding issuing State expires.
    Paragraph (h) provides that each State must retain all applicant 
information collected for the security threat assessment for at least 
one year. TSA believes this requirement is necessary to ensure that the 
information is available if questions or appeals arise in the course of 
the security threat assessment. The States, as licensing bodies, 
currently keep some of this information now as part of the commercial 
drivers license and HME program. The State may keep this information in 
paper or electronic form.

Section 1572.15 Procedures for Security Threat Assessment

    This section describes the security threat assessment process in 
detail, and provides that no State can issue an HME unless the steps 
outlined in this section have been completed. The process includes the 
fingerprint-based check, an intelligence-related check, and a final 
disposition.
    The fingerprint-based check covers an individual's criminal history 
to determine whether the applicant has been convicted of or 
incarcerated for a disqualifying felony under Federal, State, or local 
law. In addition, TSA can review databases related to an applicant's 
dishonorable discharge from the armed service, if any, during this 
phase of the security threat assessment, which may indicate whether the 
applicant has a disqualifying military conviction. This check requires 
collecting fingerprints and applicant information, and submitting the 
prints to the FBI and the information to TSA.
    The intelligence-related check involves the use of an applicant's 
biographical and identification information that is collected during 
the HME application process. This check searches for potential 
terrorist activity, immigration status, and mental incompetency. In 
many cases, only certain Federal agencies are authorized to access the 
pertinent databases to complete these checks, and some of these 
databases may be classified.
    Once TSA has received the results of the fingerprint- and 
intelligence-related checks, TSA reviews them to determine if the 
individual meets the security threat assessment standards. If the 
applicant meets the standards, TSA will notify the State with a 
Determination of No Security Threat for the applicant. Once the State 
receives this Determination, it issues or renews the HME.
    If TSA determines that an applicant does not meet the standards for 
holding an HME, TSA issues an Initial Determination of Threat 
Assessment to the applicant. The Initial Determination includes the 
basis for the determination; instructions on how the individual may 
appeal the finding; and a statement that if the applicant does not 
appeal the finding, the Initial Determination becomes a Final 
Determination of Threat Assessment, which cannot be appealed. If the 
applicant does not appeal the finding, TSA notifies the issuing State, 
and the State cannot issue, renew, or transfer the applicant's HME.
    If an applicant appeals the Initial Determination, but the appeal 
does not overturn the Initial Determination, TSA notifies the State and 
applicant with a Final Determination of Threat Assessment. However, if 
TSA determines that the Initial Determination was inaccurate (due to 
incomplete court records, for instance) and grants the appeal, TSA 
issues a Withdrawal of the Initial Determination of Threat Assessment 
to the applicant and a Determination of No Security Threat to the 
State.
    This IFR now includes details of the process involved when an 
immediate revocation occurs. The State must immediately revoke an HME 
when so notified by TSA. TSA will issue an Initial Determination of 
Threat Assessment and Immediate Revocation when TSA's security threat 
assessment indicates that a driver may pose an imminent threat to 
national or transportation security. This issuance may also occur when 
an individual has a disqualifying offense, but has not surrendered his 
endorsement, as required by the rule. Under this procedure, the 
individual's HME is revoked immediately and he may appeal the 
revocation afterward. Also, if TSA does not receive an appeal of an 
Initial Determination of Threat Assessment and Immediate Revocation 
within the prescribed time periods, the Initial Determination becomes 
final. If TSA grants the appeal, TSA will issue a Withdrawal of the 
Initial Determination to the applicant and Determination of No Security 
Threat to the State.
    It is important to note that TSA may begin the final disposition 
phase of the threat assessment process after receiving adverse 
information from the fingerprint- or intelligence-related portion of 
the check, even if both checks are not complete. For instance, if TSA 
obtains the results of an intelligence-related check before the 
fingerprint-based check, and the information identifies the applicant 
as a terrorist, TSA may issue its Initial and Final Determinations 
before the fingerprint check is complete. There is no reason to wait 
for all information to become available if the information in hand is 
disqualifying. We do not anticipate that this scenario will occur 
often.
    An applicant may appeal an adverse finding due to the fingerprint- 
or the intelligence-related checks. This process will often be a 
``correction of records'' because the basis of the appeal is that the 
records on which TSA relied are not accurate or involve a different 
individual. In the case of an appeal of the intelligence-related check, 
the data or documents that gave rise to the adverse finding may be 
classified or otherwise protected by law, in which case TSA cannot 
release the document or information. However, TSA will make every 
effort to provide as much information to the applicant as the law 
permits to facilitate a meaningful appeal.
    Certain applicants disqualified from holding an HME may request a 
waiver of the standards. Individuals who commit certain disqualifying 
offenses or have a history of mental incapacity are eligible to apply 
for a waiver. Individuals identified as posing a threat under Sec.  
1572.107 or do not fall within the lawful immigration categories listed 
in the IFR are not eligible for a waiver.
    TSA uses the term ``serves'' in the rule text for the process by 
which TSA will notify the States and applicants of the security threat 
assessment determinations. The definition of ``date of service'' in 
Sec.  1572.3 includes the date of personal delivery; the mailing date 
shown on a certificate of service; 10 days from the date of mailing if 
there is no certificate of service; another mailing date shown by other 
evidence if there is no certificate of service or postmark; or the date 
on which an electronic transmission is sent.
    TSA and the States have discussed the benefits of communicating 
this sort of information electronically, and so ``serve'' may include 
uploading the notifications to the State on a secure website. This 
method of communication would save time, paper, and money, and furthers 
the e-government movement. However, there may be instances in which a 
State would prefer to receive a determination in hard copy, and so TSA 
invites comment from the States on this issue.
    TSA has some concern about the potential difficulty in providing 
notice to a driver who may be on the road for weeks at a time. The 
information required in Sec.  1572.9 requests the applicant's mailing 
address if it differs from the residential address. Drivers should be 
careful when completing the application to provide the address that is 
best for appropriate notice from the State and TSA. We have amended the

[[Page 68735]]

definition of ``date of service'' to underscore that TSA will use the 
address given on the application for service of documents. We invite 
comment on this issue from drivers and their associations as to how 
this concern can be minimized.
    Once the fingerprint- and intelligence-related checks are complete, 
paragraph (d) explains the actions TSA will take to conclude the 
assessment.

Section 1572.103 Disqualifying Criminal Offenses

    Congress did not specify in the USA PATRIOT Act the criminal 
offenses that TSA must use to determine whether a person poses a 
security risk warranting denial of an HME. TSA considered the crimes 
listed in 49 U.S.C. 44936, which include misdemeanors and felonies, for 
individuals who have unescorted access to secured areas of airports or 
aircraft, security screeners, and other aviation personnel.
    However, TSA included only felonies, and felonies that constitute 
the most serious crimes as disqualifying. The list includes crimes that 
demonstrate an individual's willingness to commit violent acts against 
others for personal reasons, such as murder or assault with intent to 
murder. The list also includes the crime of smuggling contraband. TSA 
is concerned with the possibility that such an individual could be 
involved intentionally, or may be used unwittingly by others with 
malicious intent, in transporting items that could be used to commit 
terrorist acts. The listed offenses are considered grounds for 
disqualification whether they are prosecuted by civilian or military 
authorities. If an applicant has a disqualifying criminal offense, but 
believes that under the particular circumstances of the offense the 
applicant should not be determined to pose a security threat, the 
applicant may request a waiver under Sec.  1572.143.
    This IFR makes changes to the Current Rule's list of crimes that 
disqualify an applicant for life from holding an HME. The Current Rule 
lists espionage, sedition, treason, arson, crimes involving a 
transportation security incident, improper transportation of a 
hazardous material under 49 U.S.C. 5124, any crime listed in 18 U.S.C. 
chapter 113B--Terrorism, and conspiracy or attempt to commit the crimes 
in paragraph 1572.103(a) as permanently disqualifying. TSA is 
reclassifying arson as an interim rather than permanent disqualifying 
offense. As discussed in greater detail above, TSA has concluded that 
an arson conviction does not typically present the same level of threat 
as a conviction for treason or espionage and is more analogous to the 
interim disqualifying offenses. Also, the IFR now makes a RICO 
conviction based on an underlying permanent disqualifying offense a 
permanently disqualifying offense. The Current Rule lists as 
permanently disqualifying the ``unlawful possession, use, sale, 
distribution, or manufacture of an explosive.'' We now add ``purchase, 
receipt, transfer, shipping, transporting, delivery, import, export of, 
or dealing in an explosive or explosive device'' to this list, because 
these additional actions regarding explosives are equally serious. TSA 
is reclassifying murder as a permanent rather than interim 
disqualifying offense. We believe it is more analogous to the other 
permanently disqualifying offenses in terms of the security threat it 
presents.
    Under the Current Rule, individuals who have been convicted within 
the preceding seven years of, or incarcerated within the preceding five 
years for a criminal offense listed in Sec.  1572.103(b), are 
disqualified until the seven- or five-year time period ends, whichever 
is later. In the Current Rule, the offenses in paragraph 1572.103(b) 
are murder; assault with intent to murder; kidnapping or hostage 
taking; rape or aggravated sexual abuse; unlawful possession, use, 
sale, purchase, distribution, or manufacture of a firearm or other 
weapon; extortion; dishonesty, fraud, or misrepresentation, including 
identity fraud; bribery; smuggling; immigration violations; violations 
of the Racketeer Influenced and Corrupt Organizations Act; 18 U.S.C. 
1961, et seq.; robbery; and distribution of, intent to distribute, or 
importation of a controlled substance.
    This IFR amends the list of interim disqualifying offenses in 
several ways. The Current Rule lists as disqualifying the ``unlawful 
possession, use, sale, distribution, or manufacture of a firearm or 
other weapon.'' We now add ``purchase, receipt, transfer, shipping, 
transporting, delivery, import, export of, or dealing in a firearm or 
other weapon'' to this list, because these additional actions regarding 
a weapon are equally serious. Second, we are removing ``simple 
possession'' of a controlled substance as disqualifying and making 
clear that ``possession with intent to distribute a controlled 
substance'' remains a disqualifying offense. TSA makes this change to 
ensure that only the most serious offenses, including those 
demonstrating a willingness to endanger others, are considered 
disqualifying. TSA is reclassifying arson as an interim rather than 
permanent disqualifying offense, as it is in the Current Rule. Finally, 
TSA is reclassifying murder as a permanently rather than interim 
disqualifying offense.
    We note, as discussed when this rule first was adopted, that this 
rule cannot possibly list all of the offenses or other information that 
may be relevant to determining whether an individual poses a security 
threat that merits denial of a hazardous materials endorsement. 
Therefore, under Sec.  1572.107, TSA may consider other criminal 
offenses and information not listed in Sec.  1572.103, if they indicate 
the individual poses a security threat. TSA believes these changes in 
Sec.  1572.107 clarify the extent of TSA's discretion. See 68 FR 23852 
at 23861 col. 2-3.
    TSA invites comment from all interested parties concerning this 
list of disqualifying criminal offenses. TSA must balance its 
responsibility to enhance the security of hazardous materials 
transportation against the knowledge that individuals who participate 
in criminal acts may subsequently become valuable members of the 
workforce. TSA wishes to minimize the adverse impact this program may 
have on individuals who have committed criminal offenses and served 
their sentences, without compromising the security of hazardous 
materials in transportation. Therefore, with limited exceptions, only 
convictions within the seven years prior to the date of the application 
to apply or renew a hazardous materials endorsement, or incarcerations 
that ended within five years prior to the date of application, will 
disqualify an individual. This approach is consistent with the 
requirements of MTSA.
    Paragraph (c) states that an applicant who is under a want or 
warrant for any of the disqualifying offenses is disqualified until the 
want or warrant is released. TSA will adjudicate these cases and notify 
appropriate law enforcement agencies and the State. TSA will review the 
want and warrant records carefully to determine the nature of the 
charge, and if it does not involve a disqualifying offense, but is 
indicative of a serious criminal act, TSA may notify law enforcement 
pursuant to Sec.  1572.107, discussed below.
    Paragraph (d) describes how an arrest with no indication of a 
conviction, plea, sentence or other information indicative of a final 
disposition must be handled. The individual must provide TSA with 
written proof that the arrest did not result in a disqualifying 
criminal offense within 45 days after the date TSA notifies the 
individual. If TSA does not receive such proof in 45 days, TSA will 
notify the applicant and the State that

[[Page 68736]]

the applicant is disqualified from holding an HME.

Section 1572.105 Immigration Status

    The USA PATRIOT Act and SEA require a check of the relevant 
databases to determine the applicant's status under U.S. immigration 
laws prior to authorizing the applicant to transport hazmat. In 
addition, longstanding rules concerning the qualifications needed to 
hold a CDL provide that the driver must have a State of domicile in the 
United States or hold a nonresident CDL.\22\ The Current Rule requires 
applicants for an HME security threat assessment to be U.S. citizens or 
lawful permanent residents. As discussed in greater detail above, in 
this IFR, TSA expands the group eligible to apply for an HME security 
threat assessment to include individuals who are qualified to hold a 
CDL, but who are not U.S. citizens or lawful permanent residents. This 
group includes nonimmigrant aliens, asylees, and refugees, who are in 
lawful status and possess valid and unrestricted documentation 
establishing eligibility for employment. These changes are reflected in 
paragraph (a) of this section. TSA is making one additional change to 
paragraph (a)(1) of this section by adding that an applicant must be a 
citizen who has not renounced ``or lost'' his or her citizenship. TSA 
is adding this language to cover instances in which a citizen is 
stripped of U.S. citizenship, as is the case with Nazi war criminals. 
It is unlikely that this situation will arise in the context of hazmat 
drivers, but TSA wishes to make certain that the rule covers instances 
in which it does occur.
---------------------------------------------------------------------------

    \22\ 49 CFR 384.212.
---------------------------------------------------------------------------

    To determine an individual's immigration status, TSA checks the 
relevant immigration databases, and may perform other checks, including 
verifying the applicant's identity and Social Security Number.

Section 1572.107 Other Analyses

    Section 1012 of the USA PATRIOT Act requires background checks of 
relevant international databases, such as Interpol-U.S. National 
Central Bureau, or other appropriate sources. TSA checks these 
databases and other databases that include information on terrorists 
and terrorist activity, violent gangs, fugitives from justice, and 
international criminal records. TSA may also check databases that 
assist in confirming an individual's identity. This IFR provides that 
TSA will check the following databases, and conduct a security threat 
analysis, before determining whether an individual poses a security 
threat: (1) Interpol and other international databases as appropriate; 
(2) terrorist watchlists and related databases; and (3) other databases 
relevant to determining whether an individual may pose or poses a 
security threat or that confirm an individual's identity.
    New paragraph (c) also states that TSA may determine that an 
individual poses a security threat if the search TSA conducts under 
part 1572 reveals an extensive or very serious domestic or foreign 
criminal history, conviction for serious crimes not listed in Sec.  
1572.103, or an extensive period of imprisonment, foreign or domestic, 
exceeding 365 consecutive days. TSA is adding this language to the rule 
text to clarify the full application of this section and to provide 
sufficient notice to the public that there may be cases in which an 
applicant's criminal record includes convictions for serious crimes 
that are not specifically listed in Sec.  1572.103, but may be 
disqualifying. Also, if an applicant has been imprisoned for more than 
a year, which is generally indicative of a serious offense or a long 
history of criminal activity, TSA may determine that the applicant 
poses an unacceptable security threat. We use the term ``imprisoned'' 
in the new language, which is indicative of a more serious criminal 
sentence; time sentenced to a half-way house or treatment facility is 
not used to calculate the period of ``imprisonment,'' as it is with 
respect to ``incarceration.''
    As TSA noted in the May 5 IFR, we cannot possibly list all of the 
offenses or other information that may be relevant to determining 
whether an individual poses a security threat that warrants denial of a 
hazardous materials endorsement. The preamble of the May 5 IFR stated 
that, under Sec.  1572.107, TSA may consider other criminal offenses 
and information not listed in Sec.  1572.103, if they indicate the 
individual poses a security threat. See 68 FR 23852 at 23861. The rule 
text for Sec.  1572.107 clearly states this authority. TSA believes we 
must have a level of discretion to carry out the intent of the USA 
PATRIOT Act and responsibly assess threats to transportation and the 
Nation, where the intelligence and threats are so dynamic. TSA 
understands that the flexibility this language provides must be used 
cautiously and on the basis of compelling information that can 
withstand judicial review. TSA invites comment on this section.

Section 1572.109 Mental Capacity

    The explosives laws prohibit individuals who have been adjudicated 
as lacking mental capacity (``mental defect'' is used in the statutory 
language, but we use ``lacking mental capacity'' in the IFR because it 
is less pejorative, but has and is intended to have the same meaning) 
from transporting explosives. This IFR will implement this requirement 
by providing that any person who has been determined to lack mental 
capacity does not meet the standards for a security threat assessment. 
This section adopts the terms and standards concerning individuals with 
mental disabilities promulgated by ATF:

    The legislative history of the GCA [Gun Control Act of 1968] 
makes it clear that a formal adjudication or commitment by a court, 
board, commission or similar legal authority is necessary before 
firearms disabilities are incurred. H.R. Rep. 1956, 90th Cong., 2d 
Sess. 30 (1968). The plain language of the statute makes it clear 
that a formal commitment, for any reason, e.g., drug use, gives rise 
to firearms disabilities. However, the mere presence of a person in 
a mental institution for observation or a voluntary commitment to a 
mental hospital does not result in firearms disabilities.\23\
---------------------------------------------------------------------------

    \23\ 61 FR 47095, September 6, 1996.

    ATF also cited several cases in which courts held that the GCA was 
designed to prohibit the receipt and possession of firearms by 
individuals who are potentially dangerous, including individuals who 
are mentally incompetent or afflicted with a mental illness, and 
individuals found not guilty by reason of insanity in a criminal 
case.\24\ Finally, ATF added to the definition of ``adjudicated as 
mental defective'' an element from the Department of Veterans Affairs 
definition of ``mental incompetent'' an individual who because of 
injury or disease lacks the mental capacity to contract or manage his 
or her own affairs.\25\
---------------------------------------------------------------------------

    \24\ Id.
    \25\ Id.
---------------------------------------------------------------------------

    An individual lacks mental capacity, for purposes of this IFR, if 
he or she has been committed to a mental institution or has been 
adjudicated as lacking mental capacity. An individual is adjudicated as 
lacking mental capacity if a court or other appropriate authority 
determines that the individual is a danger to himself or herself, or 
lacks the mental capacity to manage his or her affairs. An individual 
is ``committed to an institution'' if formally committed by a court; 
this term does not refer to voluntary admissions to a mental 
institution or hospital. This standard is in the Current Rule and the 
IFR.

[[Page 68737]]

Section 1572.111-1572.139 [Reserved]

Section 1572.141 Appeal Procedures

    An individual may appeal an Initial Determination of Security 
Threat if he asserts that he meets all standards for the security 
threat assessment. For example, if the Initial Determination was based 
on information indicating that the applicant is an alien who is not in 
the United States lawfully, the applicant may provide TSA with evidence 
that the immigration record is inaccurate in an appeal.
    An applicant initiates an appeal by providing TSA with a written 
request for the releasable materials upon which the Initial 
Determination was based, or by serving TSA with his or her written 
reply to the Initial Determination. If an applicant wishes to receive 
copies of the releasable material upon which the Initial Determination 
was based, he must serve TSA with a written request within 30 days 
after the date of service of the Initial Determination. TSA's response 
is due within 30 days. In response, TSA cannot provide any classified 
information, as defined in Executive Order (E.O.) 12968, or any other 
information or material protected from disclosure by law.
    If an applicant wishes to reply to the Initial Determination, he or 
she must provide TSA with a written reply no later than 30 days after 
the date of service of the Initial Determination or the date of service 
of TSA's response to the applicant's request for materials. The 
applicant should explain why he or she is appealing the Initial 
Determination and provide evidence that the Initial Determination was 
incorrect. In an applicant's reply, TSA will consider only material 
that is relevant to whether he or she meets the standards for the 
security threat assessment. If an applicant does not dispute or reply 
to the Initial Determination, the Initial Determination becomes a Final 
Determination.
    Under paragraph (c)(3) of this section, an applicant has the 
opportunity to correct a record on which an adverse decision is based. 
So long as the record is not classified or protected by law from 
release, TSA will notify the applicant of the adverse information and 
provide a copy of the record. If the applicant wishes to correct the 
inaccurate information, he or she must provide written proof that the 
record is inaccurate. The applicant should contact the jurisdiction 
responsible for the inaccurate information to complete or correct the 
information contained in the record. The applicant must provide TSA 
with the revised record or a certified true copy of the information 
from the appropriate entity before TSA can reach a determination that 
the applicant does not pose a security threat that warrants denial of 
the HME.
    The Director will make the Final Determination on appeals that 
involve disqualifying criminal offenses, mental capacity, and 
immigration status. However, in a case where an Initial Determination 
of Threat Assessment is based on the applicant's connection to 
terrorist activity or similar threat under Sec.  1572.107, the 
Assistant Secretary will review the appeal and make the Final 
Determination. This procedure is a change from the Current Rule that 
TSA believes is necessary to provide additional scrutiny for cases that 
will likely involve a review of classified information that the 
applicant is not permitted to see under law. In addition, the applicant 
in these cases is not eligible for a waiver of the standards if the 
Initial Determination stands. TSA believes that the review by the 
Assistant Secretary for these cases provides an additional protection 
that the agency's Final Determination is sound.
    In considering an appeal, the Director or Assistant Secretary will 
review the Initial Determination, the materials upon which the Initial 
Determination is based, the applicant's reply and any accompanying 
information, and any other materials or information available to TSA. 
The Director or Assistant Secretary may affirm the Initial 
Determination by concluding that an individual poses a security threat. 
In this case, TSA serves a Final Determination of Threat Assessment on 
the applicant. The Final Determination includes a statement that the 
Director or Assistant Secretary has reviewed the Initial Determination, 
the materials upon which the Initial Determination was based, the 
reply, if any, and any other materials or information available to the 
Director or Assistant Secretary and has determined that the applicant 
poses a security threat. There is no administrative appeal of the Final 
Determination of Threat Assessment. However, as explained below, an 
applicant may apply for a waiver under certain circumstances. For 
purposes of judicial review, the Final Determination of Threat 
Assessment constitutes a final TSA order.
    Paragraph (e) sets forth the procedures to follow if TSA determines 
that the applicant does not pose a security threat. TSA serves a 
Withdrawal of the Initial Determination on the applicant and a 
Determination of No Security Threat on the issuing State.
    If TSA did not serve the individual with an Initial Determination 
of Threat Assessment, or grants a waiver, the agency will transmit a 
Determination of No Security Threat to the applicant and the State in 
which the applicant applied for the HME.
    Paragraph (f) provides that TSA cannot disclose classified 
information, as defined in E.O. 12968 section 1.1(d), to the applicant, 
and TSA reserves the right not to disclose any other information or 
material not warranting disclosure or protected from disclosure under 
law, such as Sensitive Security Information (SSI); sensitive law 
enforcement and intelligence information; sources, methods, means, and 
application of intelligence techniques; and identities of confidential 
informants, undercover operatives, and material witnesses.
    For determinations under Sec.  1572.107, the finding that an 
individual poses a security threat will be based, in large part, on 
classified national security information, unclassified information 
designated as SSI, or other information that is protected from 
disclosure by law.
    Classified national security information is information that the 
President or another authorized Federal official has determined, 
pursuant to E.O. 12968, must be protected against unauthorized 
disclosure to safeguard the security of American citizens, the 
country's democratic institutions, and America's participation within 
the community of nations.\26\ Executive Order 12968 prohibits Federal 
employees from disclosing classified information to individuals who 
have not been cleared to have access to such information under the 
requirements of that Executive Order.\27\ If the Director determines 
that an applicant who is appealing the intelligence-related check is 
requesting classified materials, the applicant will not be able to 
access classified national security information, and TSA has no 
authority to release this information to the applicant.
---------------------------------------------------------------------------

    \26\ See E.O. 12958, 60 FR 19825, April 20, 1995.
    \27\ See E.O. 12968, sec. 3.2(a), 6.2(a)(1), 60 FR 40245, Aug. 
7, 1995.
---------------------------------------------------------------------------

    The denial of access to classified information under these 
circumstances is consistent with the treatment of classified 
information under the Freedom of Information Act (FOIA), which 
specifically exempts such information from the general requirement 
under FOIA that all government documents are subject to public 
disclosure.\28\
---------------------------------------------------------------------------

    \28\ See 5 U.S.C. 552(b)(1).
---------------------------------------------------------------------------

    SSI is unclassified information that is subject to disclosure 
limitations under statute and TSA regulations.\29\ Under 49

[[Page 68738]]

U.S.C. 114(s), the Assistant Secretary of TSA may designate categories 
of information as SSI if release of the information would be 
detrimental to the security of transportation. Information that is 
designated as SSI must only be disclosed to people with a need to know, 
such as those needing to carry out regulatory security duties.\30\
---------------------------------------------------------------------------

    \29\ See 49 U.S.C. 114(s); 49 CFR part 1520 as amended by 69 FR 
28066 (May 18, 2004).
    \30\ See 49 CFR 1520.11 as added by 69 FR 28084-5.
---------------------------------------------------------------------------

    The Assistant Secretary has defined information concerning threats 
against transportation as SSI by regulation.\31\ Thus, information that 
TSA obtains indicating that an applicant poses a security threat, 
including the source of such information and the methods through which 
the information was obtained, will commonly be designated SSI or 
classified information. The purpose of designating this information as 
SSI is to ensure that those who seek to do harm to the transportation 
system and their associates do not obtain access to information that 
will enable them to evade the government's efforts to detect and 
prevent their activities. Disclosure of this information, especially to 
an applicant specifically suspected of posing a threat to the 
transportation system, is precisely the type of harm that Congress 
sought to avoid by authorizing the Assistant Secretary to define and 
protect SSI.
---------------------------------------------------------------------------

    \31\ See 49 CFR 1520.5
---------------------------------------------------------------------------

    Other pieces of information also are protected from disclosure by 
law due to their sensitivity in law enforcement and intelligence. In 
some instances, the release of information about a particular 
individual or his or her supporters or associates could have a 
substantial adverse impact on security matters. The release by TSA of 
the identities or other information regarding individuals related to a 
security threat determination could jeopardize sources and methods of 
the intelligence community, the identities of confidential sources, and 
techniques and procedures for law enforcement investigations or 
prosecution.\32\ Release of such information also could have a 
substantial adverse impact on ongoing investigations being conducted by 
Federal law enforcement agencies, by revealing the course and progress 
of an investigation. In certain instances, release of information could 
alert co-conspirators to the extent of the Federal investigation and 
the imminence of their own detection, thus provoking flight.
---------------------------------------------------------------------------

    \32\ See 5 U.S.C. 552(b)(7)(D), (E).
---------------------------------------------------------------------------

    For the reasons discussed above, TSA will not provide any 
classified information to an applicant, and TSA reserves the right to 
withhold SSI or other sensitive material protected from disclosure 
under law. As noted above, TSA expects that information will be 
withheld only for determinations based on Sec.  1572.107, which involve 
databases that list indicators of potential terrorist activity or 
threats. When the determination is based on the individual's criminal 
records, TSA expects that appropriate supporting records most likely 
can be disclosed to the applicant upon a written request to TSA. With 
respect to disqualifications based on immigration status, TSA will 
provide the driver with the reason for a denial, but may not be able to 
provide specific documentation on the applicant's alien status.
    Under this IFR, TSA has the discretion to extend due dates both for 
an applicant and for the agency during the appeal process. An applicant 
must provide a written statement of good cause for extending the due 
date, within a reasonable time prior to the due date at issue. TSA has 
changed this section from ``within seven days'' to a ``reasonable 
time'' to provide the driver as much time as he or she reasonably 
needs. This change is also in line with the rules of civil procedure. 
TSA anticipates that if an applicant is attempting to correct erroneous 
records or gather documents in support of a waiver request, the 
individual may need additional time for the appropriate governmental 
agency or entity to produce the documents. As long as the applicant 
provides a sufficient explanation of these problems, TSA will likely 
extend the time needed to complete the process.
    Paragraph (i) of this section describes the procedure for appealing 
an immediate revocation of an HME under Sec.  1572.13(a). Immediate 
revocation will occur where TSA determines during the course of 
conducting a security threat assessment that sufficient factual and 
legal grounds exist to warrant immediate revocation of the HME. Under 
these circumstances, the applicant must surrender the endorsement and 
cease transporting hazardous materials prior to initiating an appeal. 
TSA understands that removing the individual from service without an 
opportunity to correct the record may have adverse consequences, but 
this mechanism will be used only in cases where the risk of imminent 
danger is significant and the adverse information is highly reliable. 
This procedure will also be used where a driver should have surrendered 
the endorsement and/or applied for a waiver, but failed to do so. The 
individual may appeal this decision, must include all supporting 
documentation when he or she submits the appeal, and may request 
releaseable documents from TSA.

Section 1572.143 Waiver Procedures

    This section applies to applicants who have been disqualified from 
holding or obtaining an HME due to a disqualifying criminal offense or 
mental incompetency. The Current Rule provides that an applicant with 
any disqualifying offense or issues of mental competence may apply for 
a waiver. In this IFR, TSA prohibits applicants with certain criminal 
convictions from applying for a waiver. TSA has concluded that crimes 
of espionage, treason, sedition, a terrorist act, or a crime involving 
a transportation security incident are so highly indicative of a 
security threat that individuals convicted of them pose an ongoing, 
unacceptable risk to transportation security. Most likely, these 
individuals will be incarcerated for a very long term, but the rule now 
makes clear that convictions for these crimes disqualify an individual 
for life, with no opportunity to apply for a waiver. Individuals who 
are disqualified due to mental incompetence continue to be eligible for 
a waiver.
    Waivers are offered because an applicant may be rehabilitated to 
the point that he or she can be trusted in sensitive or potentially 
dangerous work or has been declared mentally competent. The Current 
Rule and this IFR provide criteria that TSA considers if the individual 
does not meet the criminal history standards. TSA believes that these 
factors are good indicators that an individual may be rehabilitated to 
the point that a waiver is advisable. The factors are: (1) The 
circumstances of the disqualifying act or offense; (2) restitution made 
by the individual; (3) Federal or State mitigation remedies; (4) court 
records indicating that the individual has been declared mentally 
competent; and (5) other factors TSA believes bear on the potential 
security threat posed by the individual. Many of these factors are set 
forth in MTSA, at 46 U.S.C. 70105(c)(2).
    With respect to mental competency, TSA will accept a court order or 
official medical declaration showing that an individual previously 
declared incompetent is now competent to support the waiver request. 
Generally, TSA will not grant waivers on the basis of a letter from a 
treating physician stating that the individual is capable of 
maintaining a job, because these submissions tend to be very subjective 
and vague. The standard in the rule states that an applicant is 
mentally

[[Page 68739]]

incompetent if a court declares it or he or she is involuntarily 
committed to a mental hospital. Official documents that reverse these 
findings are necessary for TSA to grant a waiver. TSA requests comment 
on any additional criteria that the agency should consider when 
determining whether to grant a waiver.
    TSA, however, will not grant waivers from the standards concerning 
immigration status or information discovered during a search under 
Sec.  1572.107. With respect to immigration violations and findings 
under Sec.  1572.107, individuals may appeal an Initial Determination 
based on assertions that the underlying records are incorrect, the 
applicant's identity is mistaken, or TSA's analysis of the records is 
not correct. However, if TSA finds that the Initial Determination is 
accurate, the individual is ineligible for a waiver.
    After reviewing an individual's application for a waiver, TSA sends 
a written decision to the individual and, if the waiver is granted, a 
Determination of No Security Threat to the State in which the 
individual applied for the HME within 30 days after the date of the 
individual's waiver application.

Subpart C--Transportation of Explosives From Foreign Locations

    In this IFR, TSA moves the existing standards concerning the 
transportation of explosives from Canada to the United States via 
commercial motor vehicle and rail to new subpart C. The existing 
standards are not changing substantively; they are just being moved to 
a separate Subpart.

Rulemaking Analyses and Notices

Justification for Immediate Adoption

    TSA is issuing this interim final rule without prior notice and 
opportunity to comment on certain new standards, pursuant to authority 
under section 4(a) of the Administrative Procedure Act (5 U.S.C. 
553(b)). This provision allows the agency to issue a final rule without 
notice and opportunity to comment when the agency for good cause finds 
that notice and comment procedures are ``impracticable, unnecessary or 
contrary to the public interest.''
    TSA issued the May 5 IFR and request for comments that set forth 
most of the standards that are in the document we publish today. TSA 
received comments from the States and the trucking industry, and to the 
extent possible, we now make changes to the rule to accommodate those 
comments. However, certain details of the program implementation were 
not available to TSA when the Current Rule was published. The full 
program will become operational on January 31, 2005, and the States 
must have this information as soon as possible in order to implement 
the program.
    Also, TSA must determine quickly how many States will elect to 
collect fingerprints and applicant information and how many will opt to 
have TSA complete this work, so that TSA can procure a contractor to 
establish a national fingerprinting collection system. This document 
requires the States to make this declaration within 30 days of 
publication of the rule so that TSA can publish a request for proposals 
to implement the program.
    Therefore, TSA believes that issuing a proposed rule to address the 
changes and new provisions in the rule is contrary to the public 
interest and impracticable. Most of the amendments we are making to the 
Current Rule are minor and actually reduce burdens on the States. We 
are issuing this IFR with a request for comments and will publish a 
discussion and resolution of all comments received, and make any needed 
changes to the rule.

Regulatory Evaluation

    Executive Order 12866, ``Regulatory Planning and Review'' (58 FR 
51735, October 4, 1993), provides for making determinations whether a 
regulatory action is ``significant'' and therefore subject to Office of 
Management and Budget (OMB) review and to the requirements of the 
Executive Order.
    TSA has determined that this action is a significant regulatory 
action within the meaning of Executive Order 12866 because there is 
significant public interest in security issues since the events of 
September 11, 2001, and approximately 2.7 million commercial drivers 
are subject to the rule. This IFR amends existing standards that 
implement section 1012 of the USA PATRIOT Act by establishing the 
criteria used in determining whether an individual applying for, 
transferring, or renewing an HME poses a security risk warranting 
denial of the endorsement. OMB has reviewed this rule.
    TSA has prepared a detailed analysis of the costs and benefits of 
the hazmat security threat assessment program, which has been placed in 
the docket. A summary of that analysis is set forth below.
Costs
    The IFR results in a cost impact for TSA, States, and individuals 
applying for, transferring, or renewing an HME. TSA will incur costs 
for conducting security threat assessments and for bringing on line the 
systems, personnel, and resources to conduct the security threat 
assessments. The major cost-related areas for the States are applicant 
information and fingerprint collection, processing, and transmission. 
Hazmat driver applicants will incur opportunity costs in complying with 
the requirements of the IFR.
    Individuals applying for, transferring, or renewing an HME will 
incur opportunity costs in complying with the requirements of the IFR. 
These applicants will also have cash expenditures, or out-of-pocket 
costs, that would be approximately equal to the total of: (1) 
Fingerprint associated costs, (2) fees established to cover information 
and fingerprint collection and transmission, and (3) the fee 
established to cover the cost of security threat assessments. Because 
the aforementioned costs have been estimated separately in this 
analysis, no separate estimate was made for out-of-pocket Hazmat driver 
applicant costs. Rather, to avoid double counting these costs, TSA 
assumed that out-of-pocket Hazmat driver applicant expenses are 
accounted for in the separate estimates of fingerprinting and 
associated costs, information and fingerprint collection and 
transmission costs, and TSA security threat assessment costs.
    For this cost analysis, three scenarios were considered: (1) All 
States choose to collect applicant information and fingerprints, (2) 50 
percent of the States choose to collect information and fingerprints, 
and (3) all States choose to allow a TSA agent to collect information 
and fingerprints. TSA estimated the total ten-year undiscounted cost at 
$534.1 million under scenario 1, $532.3 million under scenario 2, and 
$530.5 million under scenario 3.
    Table 1 summarizes the ten-year discounted and undiscounted costs 
of the IFR. Separate estimates of costs are shown for States and TSA 
(Federal government costs). Table 1 also shows discounted and 
undiscounted opportunity costs to Hazmat drivers based on the time that 
they must spend providing information and fingerprints.

[[Page 68740]]



                                            Table 1.--Overall Summary of Ten-Year Costs Under Three Scenarios
                                                                       [millions]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          All States collect applicant   50% of States collect applicant    All States choose TSA agent
                                                                  information                      information           -------------------------------
                                                       ------------------------------------------------------------------
                                                         Undiscounted                     Undiscounted                     Undiscounted    Present value
                                                             costs       Present value        costs       Present value        costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
Population (renewals, transfers, new applicants)......             4.1  ...............             4.1  ...............             4.1  ..............
Federal (TSA) Costs:
    Start Up (non-recur)..............................            $4.8            $4.8             $4.8            $4.8             $4.8            $4.8
    Recurring Costs...................................           130.6            98.2            130.6            98.2            130.6            98.2
    FP and Associated Cost............................             0.0             0.0            116.1            87.3            232.2           174.5
                                                       -----------------
        Total States (2004-2013)......................           135.4           103.0            251.5           190.3            367.6           277.5
States Cost:
    Start Up (non-recur)..............................             3.6             3.6              1.8             1.8               NA              NA
    FP and Associated Cost............................           232.2           174.5            116.1            87.3               NA              NA
    Recordkeeping.....................................             6.4             4.8              6.4             4.8              6.4             4.8
                                                       -----------------
        Total States (2004-2013)......................           242.2           182.9            124.3            93.9              6.4             4.8
Opportunity Costs:
    Lost Time.........................................           156.5           117.6            156.5           117.6            156.5           117.6
                                                       =================
        Total Cost Impact.............................           534.1           403.5            532.3           406.5            530.5           399.9
--------------------------------------------------------------------------------------------------------------------------------------------------------

Benefits
    The primary benefit of the rule will be increased protection of 
property and citizens in the U.S. from acts of terrorism. Part of TSA's 
mission is to ensure the security of hazardous materials in 
transportation so that these materials are not used in an act of 
terrorism. The changes envisioned in this interim final rule are an 
integral part of the total program needed by the transportation 
industry to prevent such acts of terrorism.
    When quantifying benefits for which there are no exact parallels, 
similar magnitude events can demonstrate the ranges of possible 
magnitudes for either costs or benefits. Two terrorist attacks on U.S. 
soil provide examples of the harm that can occur from explosive 
material delivered in a van or light truck: The 1993 New York World 
Trade Center (WTC) bombing and the 1995 Oklahoma City Federal Building 
bombing. The 1993 WTC bombing killed six people, injured over 1,000, 
and resulted in over $510 million in insured losses. The Oklahoma City 
(OKC) bombing killed 168 people, injured 601, and resulted in over $125 
million in insured losses. Total losses for these incidents were 
estimated at $685 million.
    The intent of the IFR is to limit access to hazardous material by 
persons viewed as a security threat. The rule is designed to decrease 
the probability of terrorist incidents related to Hazmat misuse. 
Although the 1993 WTC and 1995 OKC bombings were not executed by Hazmat 
drivers, these examples show the potential damage that can occur using 
a van or light truck. If larger vehicles were used to carry out a 
terrorist attack, the damage could be far greater.
    The IFR would establish a level of security that would reduce the 
likelihood of such an event occurring. The prevention of just one 
terrorist attack similar to the examples above over the next 10 years 
would offset the cost of this rule, and supports the rule as cost-
beneficial. In addition, there are other benefits associated with 
ripple effects of incidents of this magnitude. This type of multiplier 
effect is important in determining benefits.

Initial Regulatory Flexibility Determination

    The Regulatory Flexibility Act of 1980, as amended, (RFA) was 
enacted by Congress to ensure that small entities (small businesses, 
small not-for-profit organizations, and small governmental 
jurisdictions) are not unnecessarily or disproportionately burdened by 
Federal regulations. The RFA requires agencies to review rules to 
determine if they have ``a significant economic impact on a substantial 
number of small entities.'' TSA has determined that this interim final 
rule will not have a significant economic impact on a substantial 
number of small entities.
    Under the RFA, the term ``small entity'' has the same meaning as 
the terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' This action will affect States, and States 
are governmental jurisdictions. However, States are not considered 
``small governmental jurisdictions'' under the RFA. As defined by the 
RFA, small governmental jurisdictions include governments of cities, 
counties, towns, townships, villages, school districts, or special 
districts with a population of less than 50 thousand.
    The action would also affect individuals, but current industry 
practice is for individual drivers to obtain their CDL certification as 
a condition of employment. Individuals are required to have a current 
CDL with appropriate endorsements to be eligible for employment. This 
cost is an employment cost typically borne by the individual employee, 
but individuals are not considered small entities for purposes of the 
RFA. However, individuals who are independent truck drivers and owner-
operators would be subject to the RFA. For these individuals, the IFR 
would impose costs for information collection and fees associated with 
background checks (a total of $57 per individual).
    TSA estimates that the total cost for these individuals would be 
approximately $100 per individual once the TSA security threat 
assessment fee is established and opportunity costs are considered. 
These costs will be spread over a period of five years (incurred only 
during the 5-year renewal process). TSA does not consider these costs 
to be significant when compared to the total cost of maintaining and 
operating a truck and considering that they are spread over a 5-year 
period (incurred only during the 5-year renewal process). Therefore, 
the burden on small business

[[Page 68741]]

entities from this rule is expected to be de minimis.
    TSA has conducted the required review of this rule pursuant to the 
RFA, 5 U.S.C. 605(b) and has determined that it will not have a 
significant impact on a substantial number of small entities. 
Accordingly, TSA certifies that this rule will not have a significant 
impact on a substantial number of small entities.

Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501, et 
seq.), a Federal agency must obtain approval from the Office of 
Management and Budget (OMB) for each collection of information it 
conducts, sponsors, or requires through regulations. This IFR contains 
information collection activities subject to the PRA. Accordingly, the 
following information requirements have been submitted to OMB for its 
review.
    Title: Security Threat Assessment for Individuals Applying for a 
Hazardous Materials Endorsement for a Commercial Driver's License.
    Summary: TSA is amending standards for security threat assessments 
of individuals applying for, renewing, or transferring a hazardous 
materials endorsement (HME) for a commercial driver's license (CDL), 
which in addition to the information already collected by the States 
for the purpose of HME applications, will now include fingerprints, 
immigration status, mental competency, and criminal history 
information.
    Use of: Truck drivers must complete an application and provide 
fingerprints to undergo a security threat assessment. In States that 
opt to collect applicant information and fingerprints, the States and 
local agencies will most likely collect this information when 
individuals apply for, renew, or transfer an HME. In States that opt to 
have TSA collect the application and fingerprints, the States will 
continue to have responsibility for retaining the information that TSA 
collects.
    Respondents (including number of): The likely respondents to this 
information requirement are individuals applying for, renewing or 
transferring an HME and each of the 50 States and the District of 
Columbia, for a total pool of approximately 2.7 million respondents.
    Frequency: Estimates indicate that approximately 2.7 million people 
have an HME and this number is expected to initially decrease for the 
first three years, then grow by approximately 1.0% per year for a ten-
year total of approximately 2.1 million people (210,000 annualized). 
The number of fingerprint applications to be collected over a ten-year 
period is approximately 4.1 million (407,000 annualized). This number 
includes new applicants, transfers, and renewals. States must notify 
each HME holder of the requirement to undergo a security threat 
assessment at least 60 days prior to the expiration date of the 
endorsement.
    Annual Burden Estimate: Fingerprint costs consist of a processing 
fee, processing time, and material. The average collection cost for the 
fingerprint process was estimated at approximately $35 per set. TSA 
estimates that it will take an average of thirty minutes to complete an 
FBI fingerprint card and forward it to the FBI for further processing. 
Individual respondents will also be required to complete an application 
to certify their immigration status, mental competency, and relevant 
criminal history. TSA estimates this form will take an average of 
thirty minutes to complete. Thus, for individuals, the annual estimated 
burden is 407,000 hours at a cost of $14.25 million. Added to these 
estimates will be an annual recordkeeping burden of 4,800 hours plus 
$500,000 in data retention and reporting costs for all 50 states and 
the District of Columbia combined. TSA welcomes comment from the public 
concerning these estimates.
    The agency is soliciting comments to--
    (1) Evaluate whether the information requirement is necessary for 
the proper performance of the functions of the agency, including 
whether the information will have practical utility;
    (2) Evaluate the accuracy of the agency's estimate of the burden;
    (3) Enhance the quality, utility, and clarity of the information to 
be collected; and
    (4) Minimize the burden of the collection of information on those 
who must respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology.
    Pursuant to the PRA, an agency may not conduct or sponsor, and a 
person is not required to respond to, a collection of information 
unless it displays a currently valid OMB control number. The OMB 
control number for this information collection will be published in the 
Federal Register after OMB approves it.

Executive Order 13132 (Federalism)

    Executive Order 13132 requires TSA to develop an accountable 
process to ensure ``meaningful and timely input by State and local 
officials in the development of regulatory policies that have 
federalism implications.'' ``Policies that have federalism 
implications'' are defined in the Executive Order to include 
regulations that have ``substantial direct effects on the States, on 
the relationship between the national government and the States, or on 
the distribution of power and responsibilities among the various levels 
of government.'' Under the Executive Order, TSA may construe a Federal 
statute to preempt State law only where, among other things, the 
exercise of State authority conflicts with the exercise of Federal 
authority under the Federal statute.
    This action has been analyzed in accordance with the principles and 
criteria in the Executive Order, and it has been determined that this 
Interim Final Rule does have Federalism implications or a substantial 
direct effect on the States. Under this rule, the States may choose to 
collect information and process fingerprints that will be the basis for 
TSA's security threat assessment. TSA will develop the detailed 
procedures for the program in consultation with the States.
    TSA notes that FMCSA has communicated with the States on the 
requirements of the USA PATRIOT Act. The Assistant Administrator of 
FMCSA wrote to licensing officials in each State on October 31, 2001, 
briefly summarizing section 1012 of the USA PATRIOT Act, and asking 
them to continue issuing and renewing hazardous materials endorsements 
until the regulations implementing section 1012 were completed. Some 
States have already enacted legislation they consider necessary to 
carry out the mandates of section 1012.

Unfunded Mandates Reform Act

    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires Federal agencies to prepare a written assessment of the costs, 
benefits, and other effects of proposed or final rules that include a 
Federal mandate likely to result in the expenditure by State, local, or 
tribal governments, in the aggregate, or by the private sector, of more 
than $100 million in any one year (adjusted for inflation with base 
year of 1995). Before promulgating a rule for which a written statement 
is needed, section 205 of the UMRA generally requires agencies to 
identify and consider a reasonable number of regulatory alternatives 
and adopt the least costly, most cost-effective, or least burdensome 
alternative that achieves the objective of the rule. The provisions of 
section 205 do not apply when they are inconsistent with applicable 
law. Moreover, section 205 allows TSA to

[[Page 68742]]

adopt an alternative other than the least costly, most cost-effective, 
or least burdensome alternative if the agency publishes with the final 
rule an explanation as to why that alternative was not adopted.
    This action will require a State expenditure of less than $5.0 
million in the first year of the recurring phase, regardless of whether 
it chooses to collect applicant information and fingerprints or allow a 
TSA agent to collect the required information. The ten-year State cost 
is estimated to range between $6.4 million and $242.2 million 
undiscounted, depending on the option selected by the State. Based on 
this estimate, TSA has determined that the action will not result in 
the expenditure by State, local, or tribal governments, in the 
aggregate, or by the private sector, of more than $100 million in any 
one year.

Trade Impact Assessment

    The Trade Agreement Act of 1979 prohibits Federal agencies from 
engaging in any standards or related activities that create unnecessary 
obstacles to the foreign commerce of the United States. Legitimate 
domestic objectives, such as safety, are not considered unnecessary 
obstacles. The statute also requires consideration of international 
standards and, where appropriate, that they be the basis for U.S. 
standards. TSA will continue to consult with Mexico and Canada under 
the North American Free Trade Agreement to ensure that any adverse 
impacts on trade are minimized. This rule applies only to individuals 
applying for a State-issued hazardous materials endorsement for a 
commercial drivers license. Thus, TSA has determined that this rule 
will have no impact on trade.

Environmental Analysis

    TSA has reviewed this action for purposes of the National 
Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4347) and has 
determined that this action will not have a significant effect on the 
human environment. In accordance with FAA Order 1050.1D, appendix 4, 
paragraph 4(j), this rulemaking action qualifies for a categorical 
exclusion. The FAA order continues to apply to TSA in accordance with 
the Homeland Security Act (Pub. L. 107-296), until DHS publishes its 
NEPA implementing regulations.

Energy Impact

    The energy impact of this document has been assessed in accordance 
with the Energy Policy and Conservation Act (EPCA) Public Law 94-163, 
as amended (42 U.S.C. 6362). We have determined that this rulemaking is 
not a major regulatory action under the provisions of the EPCA.

List of Subjects in 49 CFR Part 1572

    Commercial drivers license, Criminal history records check, 
Explosives, Hazardous materials, Motor carriers, Motor vehicle 
carriers, Security measures, Security threat assessment.

The Amendments

0
In consideration of the foregoing, the Transportation Security 
Administration amends chapter XII of title 49, Code of Federal 
Regulations, as follows:

SUBCHAPTER D--MARITIME AND LAND TRANSPORTATION SECURITY

0
1. Revise part 1572 to read as follows:

PART 1572--CREDENTIALING AND BACKGROUND CHECKS FOR LAND 
TRANSPORTATION SECURITY

Subpart A--Requirements To Undergo Security Threat Assessments
Sec.
1572.1 Applicability.
1572.3 Terms used in this part.
1572.5 Scope and standards for hazardous materials endorsement 
security threat assessment.
1572.7 Waivers of hazardous materials endorsement security threat 
assessment standards.
1572.9 Applicant information required for a security threat 
assessment for a hazardous materials endorsement.
1572.11 Applicant responsibilities for a security threat assessment 
for a hazardous materials endorsement.
1572.13 State responsibilities for issuance of hazardous materials 
endorsement.
1572.15 Procedures for security threat assessment.
Subpart B--Standards, Appeals, and Waivers for Security Threat 
Assessments
1572.101 Scope.
1572.103 Disqualifying criminal offenses.
1572.105 Immigration status.
1572.107 Other analyses.
1572.109 Mental capacity.
1572.111-1572.139 [Reserved]
1572.141 Appeal procedures.
1572.143 Waiver procedures.
Subpart C--Transportation of Explosives From Foreign Locations
1572.201 Transportation of explosives from Canada to the United 
States via commercial motor vehicle.
1572.203 Transportation of explosives from Canada to the United 
States via railroad carrier.

    Authority: 49 U.S.C. 114, 5103a, 40113, 46105; 18 U.S.C. 842, 
845.

Subpart A--Requirements To Undergo Security Threat Assessments


Sec.  1572.1  Applicability.

    This part prescribes regulations for credentialing and security 
threat assessments for certain maritime and land transportation 
workers.


Sec.  1572.3  Terms used in this part.

    For purposes of this part:
    Adjudicate means to make an administrative determination of whether 
an applicant meets the standards in this part based on the merits of 
the issues raised.
    Alien means any person not a citizen or national of the United 
States.
    Alien registration number means the number issued by the United 
States Department of Homeland Security to an individual when he or she 
becomes a lawful permanent resident of the United States or attains 
other lawful, non-citizen status.
    Applicant means an individual who is applying for a new, renewal, 
or transfer hazardous materials endorsement.
    Assistant Secretary means Assistant Secretary for Homeland 
Security, Transportation Security Administration (Assistant Secretary), 
who is the highest ranking TSA official, or his or her designee, and 
who is responsible for making the final determination on the appeal of 
an intelligence-related check under this part.
    Commercial drivers license (CDL) is used as defined in 49 CFR 
383.5.
    Convicted includes any plea of guilty or nolo contendere, or any 
finding of guilt, except when the finding of guilt is subsequently 
overturned on appeal, pardoned, or expunged. For purposes of this part, 
a conviction is expunged when the conviction is removed from the 
individual's criminal history record and there are no legal 
disabilities or restrictions associated with the expunged conviction, 
other than the fact that the conviction may be used for sentencing 
purposes for subsequent convictions. In addition, where an individual 
is allowed to withdraw an original plea of guilty or nolo contendere 
and enter a plea of not guilty and the case is subsequently dismissed, 
the individual is no longer considered to have a conviction for 
purposes of this part.
    Date of service means--
    (1) In the case of personal service, the date of personal delivery 
to the residential address listed on the application;
    (2) In the case of mailing with a certificate of service, the date 
shown on the certificate of service;
    (3) In the case of mailing and there is no certificate of service, 
10 days from

[[Page 68743]]

the date mailed to the address designated as the mailing address on the 
application;
    (4) In the case of mailing with no certificate of service or 
postmark, the date mailed to the address designated as the mailing 
address on the application shown by other evidence; or
    (5) The date on which an electronic transmission occurs.
    Day means calendar day.
    Determination of No Security Threat means an administrative 
determination by TSA that an individual does not pose a security threat 
warranting denial of a hazardous materials endorsement.
    Director means the officer designated by the Assistant Secretary to 
administer the appeal and waiver programs described in this part, 
except where the Assistant Secretary is specifically designated in this 
part to administer the appeal or waiver program. The Director may 
appoint a designee to assume his or her duties.
    Endorsement is used as defined in 49 CFR 383.5.
    Explosive or explosive device includes, but is not limited to, an 
explosive or explosive material as defined in 18 U.S.C. 232(5), 841(c) 
through 841(f), and 844(j), and a destructive device as defined in 18 
U.S.C. 921(a)(4) and 26 U.S.C. 5845(f).
    Final Determination of Threat Assessment means a final 
administrative determination by TSA, including the resolution of 
related appeals, that an individual poses a security threat warranting 
denial of a hazardous materials endorsement.
    Final Disposition means the actions that must be taken following 
issuance of a Determination of No Security Threat, a Final 
Determination of Security Threat, or the grant of a waiver to ensure 
that a driver's record, a driver's endorsement, and the Commercial 
Drivers License Information System (CDLIS) accurately reflect the 
results of the fingerprint and intelligence-related checks.
    Firearm or other weapon includes, but is not limited to, firearms 
as defined in 18 U.S.C. 921(a)(3) or 26 U.S.C. 5845(a) or items 
contained on the U.S. Munitions Import List at 27 CFR 447.21.
    Hazardous material has the same meaning as defined in section 103 
of the Hazardous Materials Transportation Act.
    Hazardous materials endorsement (HME) means the authorization for 
an individual to transport hazardous materials in commerce, which must 
be indicated on the individual's commercial driver's license.
    Imprisoned or imprisonment means confined to a prison, jail, or 
institution for the criminally insane, on a full-time basis pursuant to 
a sentence imposed as the result of a criminal conviction or finding of 
not guilty by reason of insanity. Time spent confined or restricted to 
a half-way house, treatment facility, or similar institution pursuant 
to a sentence imposed as the result of a criminal conviction or finding 
of not guilty by reason of insanity does not constitute imprisonment 
for purposes of this rule.
    Incarceration means confined or otherwise restricted to a jail-type 
institution, half-way house, treatment facility, or another 
institution, on a full or part-time basis pursuant to a sentence 
imposed as the result of a criminal conviction or finding of not guilty 
by reason of insanity.
    Initial Determination of Threat Assessment means an initial 
administrative determination by TSA that an individual poses or may 
pose a security threat warranting denial of a hazardous materials 
endorsement.
    Initial Determination of Threat Assessment and Immediate Revocation 
means an initial administrative determination that an individual poses 
a security threat that warrants immediate revocation of an HME. Upon 
issuance of this document, the State must immediately revoke the hazmat 
endorsement.
    Lawful permanent resident means an individual who has been lawfully 
admitted to the United States for permanent residence, as defined in 8 
U.S.C. 1101.
    Mental institution means a mental health facility, mental hospital, 
sanitarium, psychiatric facility, and any other facility that provides 
diagnoses by licensed professionals of mental retardation or mental 
illness, including a psychiatric ward in a general hospital.
    Pilot State means a State which volunteers to begin the security 
threat assessment process prior to January 31, 2005.
    Revoke means the process by which a State cancels, rescinds, 
withdraws, or removes a hazardous materials endorsement.
    State means a State of the United States and the District of 
Columbia.
    Transportation security incident means a security incident 
resulting in a significant loss of life, environmental damage, 
transportation system disruption, or economic disruption in a 
particular area, as defined in 46 U.S.C. 70101.
    Withdrawal of Initial Determination of Threat Assessment is the 
document that TSA issues after issuing an Initial Determination of 
Security Threat, when TSA determines that the applicant does not pose a 
security threat warranting denial of a hazardous materials endorsement.


Sec.  1572.5  Scope and standards for hazardous materials endorsement 
security threat assessment.

    (a) This subpart applies to--
    (1) State agencies responsible for issuing an HME; and
    (2) Applicants who are qualified to hold a commercial driver's 
license under 49 CFR parts 383 and 384, and are applying for a new, 
renewal, or transfer HME.
    (b) In conducting the security threat assessment requirements in 
this part, the States and TSA use one or more of the following:
    (1) An applicant's fingerprints.
    (2) An applicant's name.
    (3) Other identifying information.
    (c) TSA has determined that an applicant does not pose a security 
threat warranting denial of an HME if:
    (1) The applicant does not have a disqualifying criminal offense 
described in Sec.  1572.103;
    (2) The applicant meets the immigration status requirements 
described in Sec.  1572.105;
    (3) TSA conducts the analyses described in Sec.  1572.107 and 
determines that the applicant does not pose a security threat; and
    (4) The applicant has not been adjudicated as lacking mental 
capacity or committed to a mental institution, as described in Sec.  
1572.109.
    (d) TSA may direct a State to revoke an individual's HME 
immediately if TSA determines during the security threat assessment 
that the individual poses an immediate threat to transportation 
security, national security or of terrorism.
    (e) The regulations of the Federal Motor Carrier Safety 
Administration (FMCSA) provide that an applicant is disqualified from 
operating a commercial motor vehicle for specified periods if he or she 
has an offense that is listed in the FMCSA rules at 49 CFR 383.51. If 
records indicate that an applicant has committed an offense that would 
disqualify the applicant from operating a commercial motor vehicle 
under 49 CFR 383.51, TSA will not issue a Determination of No Security 
Threat until the State or the FMCSA determine that the applicant is not 
disqualified under that section.


Sec.  1572.7  Waivers of hazardous materials endorsement security 
threat assessment standards.

    (a) An applicant may apply to TSA for a waiver of the standards 
described in Sec.  1572.5, if the applicant--

[[Page 68744]]

    (1) Has a disqualifying criminal offense described in paragraphs 
1572.103(a)(5) through (a)(9), and paragraph 1572.103 (a)(10) if the 
underlying criminal offense is in paragraphs 1572.103 (a)(5) through 
(a)(9); or
    (2) Has a disqualifying criminal offense described in Sec.  
1572.103(b); or
    (3) Has a history of mental incompetence described in Sec.  
1572.109.
    (b) [Reserved].


Sec.  1572.9  Applicant information required for a security threat 
assessment for a hazardous materials endorsement.

    (a) For TSA to complete a security threat assessment, an applicant 
must supply the information required in this section when the applicant 
applies to obtain or renew a hazardous materials endorsement. When 
applying to transfer a hazardous materials endorsement, Sec.  
1572.13(g) applies.
    (b) The application must include the following identifying 
information:
    (1) Legal name, including first, middle, and last; any applicable 
suffix; and any other name used previously.
    (2) Current mailing address and residential address if it differs 
from the mailing address; and the previous residential address.
    (3) Date of birth.
    (4) Social security number.
    (5) Gender.
    (6) Height, weight, hair and eye color.
    (7) City, state, and country of birth.
    (8) Immigration status and date of naturalization if the applicant 
is a naturalized citizen of the United States.
    (9) Alien registration number.
    (10) State of application, CDL number, and type of endorsement 
held.
    (11) The name, telephone number, and address of the applicant's 
current employer(s).
    (c) The application must include the disqualifying criminal 
offenses identified in Sec.  1572.103.
    (d) The application must include a statement, signature, and date 
of signature that the applicant:
    (1) Was not convicted or found not guilty by reason of insanity of 
a disqualifying crime listed in Sec.  1572.103(b) in a civilian or 
military jurisdiction during the 7 years before the date of the 
application;
    (2) Was not released from incarceration in a civilian or military 
jurisdiction for committing a disqualifying crime listed in Sec.  
1572.103(b) during the 5 years before the date of the application;
    (3) Is not wanted or under indictment in a civilian or military 
jurisdiction for a disqualifying criminal offense identified in Sec.  
1572.103;
    (4) Was not convicted or found not guilty by reason of insanity of 
a disqualifying criminal offense identified in Sec.  1572.103(a) in a 
civilian or military jurisdiction;
    (5) Has not been adjudicated as lacking mental capacity or 
committed to a mental institution involuntarily;
    (6) Meets the immigration status requirements described in Sec.  
1572.105;
    (7) Has or has not served in the military, and if so, the branch in 
which he or she served, the date of discharge, and the type of 
discharge; and
    (8) Has been informed that Federal regulations under Sec.  1572.11 
impose a continuing obligation to disclose to the State within 24 hours 
if he or she is convicted or found not guilty by reason of insanity of 
a disqualifying crime, or adjudicated as lacking mental capacity or 
committed to a mental institution, while he or she holds an HME.
    (e) The application must include a statement reading:

    Privacy Act Notice: Authority: The authority for collecting this 
information is 49 U.S.C. 114, 40113, and 49 U.S.C. 5103a. Purpose: 
This information is needed to verify your identity and to conduct a 
security threat assessment to evaluate your suitability for a 
hazardous materials endorsement for a commercial drivers license. 
Furnishing this information, including your SSN or alien 
registration number, is voluntary; however, failure to provide it 
will prevent the completion of your security threat assessment, 
without which you cannot be granted a hazardous materials 
endorsement. Routine Uses: Routine uses of this information include 
disclosure to the FBI to retrieve your criminal history record; to 
TSA contractors or other agents who are providing services relating 
to the security threat assessments; to appropriate governmental 
agencies for licensing, law enforcement, or security purposes, or in 
the interests of national security; and to foreign and international 
governmental authorities in accordance with law and international 
agreement.
    The information I have provided on this application is true, 
complete, and correct to the best of my knowledge and belief and is 
provided in good faith. I understand that a knowing and willful 
false statement, or an omission of a material fact, on this 
application can be punished by fine or imprisonment or both (see 
section 1001 of Title 18 United States Code), and may be grounds for 
denial of a hazardous materials endorsement.

Sec.  1572.11  Applicant responsibilities for a security threat 
assessment for a hazardous materials endorsement.

    (a) Prohibitions. An applicant does not meet the security threat 
assessment standards if he or she:
    (1) Has a disqualifying criminal offense identified in Sec.  
1572.103, unless TSA grants a waiver under Sec.  1572.143; or
    (2) Does not meet the immigration status requirements identified in 
Sec.  1572.105; or
    (3) Has been notified by TSA that he or she poses a security threat 
under Sec.  1572.107; or
    (4) Has been adjudicated as lacking mental capacity or committed to 
a mental institution as described in Sec.  1572.109, unless TSA grants 
a waiver under Sec.  1572.143.
    (b) Surrender of endorsement. If an individual is disqualified from 
holding an HME under paragraph (a) of this section, he or she must 
surrender the HME and notify TSA. Failure to surrender the HME and 
notify TSA may result in immediate revocation under Sec.  1572.13(a) 
and/or civil penalties.
    (c) Continuing responsibilities. An individual who holds an HME 
must surrender the HME and notify TSA within 24 hours, if he or she:
    (1) Is convicted of, wanted, under indictment, or found not guilty 
by reason of insanity in a civilian or military jurisdiction for a 
disqualifying criminal offense identified in Sec.  1572.103; or
    (2) Is adjudicated as lacking mental capacity or committed to a 
mental institution as described in Sec.  1572.109; or
    (3) Renounces or loses U.S. citizenship; or
    (4) Violates his or her immigration status and/or is ordered 
removed from the United States.
    (d) Submission of fingerprints. (1) An applicant who has not 
already done so may submit fingerprints in a form and manner specified 
by TSA when a State revokes the applicant's HME under Sec.  1572.13(a).
    (2) When so notified by the State, an applicant must submit 
fingerprints and the information required in Sec.  1572.9 in a form and 
manner specified by the State and TSA, when TSA requests it, or when 
the applicant applies to obtain or renew an HME. The procedures 
outlined in Sec.  1572.13(g) apply to HME transfers.
    (3) When submitting fingerprints and the applicant information 
required in Sec.  1572.9, the applicant or the applicant's employer is 
responsible for the TSA fee and the FBI fee.


Sec.  1572.13  State responsibilities for issuance of hazardous 
materials endorsement.

    (a) Each State must immediately revoke an individual's HME if TSA 
informs the State that the individual does not meet the standards for 
security threat assessment in Sec.  1572.5 and issues an Initial 
Determination of Threat Assessment and Immediate Revocation.

[[Page 68745]]

    (b) Beginning January 31, 2005 for new issuances, and May 31, 2005 
for renewal or transfer issuances:
    (1) No State may issue or renew a hazardous materials endorsement 
for a CDL unless the State receives a Determination of No Security 
Threat from TSA.
    (2) Each State must notify each individual holding a hazardous 
materials endorsement issued by that State that he or she will be 
subject to the security threat assessment described in this part as 
part of an application for renewal of the endorsement, at least 60 days 
prior to the expiration date of the individual's endorsement. The 
notice must inform the individual that he or she may initiate the 
security threat assessment required by this section at any time after 
receiving the notice, but no later than 30 days before the expiration 
date of the individual's endorsement.
    (3) No State may begin processing renewal or transfer applicants 
prior to March 31, 2005.
    (c) Prior to January 31, 2005, as approved by TSA, a Pilot State 
may not revoke, issue, renew, or transfer a hazardous materials 
endorsement for a CDL unless the Pilot State--
    (1) Collects the information required in Sec.  1572.9;
    (2) Collects and submits fingerprints in accordance with procedures 
approved by TSA; and
    (3) Receives a Determination of No Security Threat or a Final 
Determination of Threat Assessment from TSA.
    (d) The State that issued an endorsement may extend the expiration 
date of the endorsement for 90 days if TSA has not provided a 
Determination of No Security Threat or a Final Determination of Threat 
Assessment before the expiration date. Any additional extension must be 
approved in advance by the Director.
    (e) Within 15 days of receipt of a Determination of No Security 
Threat or Final Determination of Threat Assessment from TSA, the State 
must--
    (1) Update the applicant's permanent record to reflect:
    (i) The results of the security threat assessment;
    (ii) The issuance or denial of an HME; and
    (iii) The new expiration date of the HME.
    (2) Notify the Commercial Drivers License Information System 
operator of the results of the security threat assessment.
    (3) Revoke or deny the applicant's HME if TSA serves the State with 
a Final Determination of Threat Assessment.
    (f) On or before December 27, 2004, each State must submit a 
written declaration to TSA, which shall remain in effect until January 
31, 2008, unless otherwise authorized by TSA, that states one of the 
following:
    (1) The State elects to collect and submit applicant fingerprints 
and information, in accordance with the requirements of this part and 
applicable fingerprint submission standards of the FBI, and the 
associated TSA and FBI fees; or
    (2) The State elects to have TSA/TSA agent collect and submit 
applicant fingerprints and information, in accordance with the 
requirements of this part and applicable fingerprint submission 
standards of the FBI, and the associated TSA and FBI fees. If TSA does 
not receive a written declaration from a State, TSA will assume 
responsibility for the collection and submission process.
    (g) For applicants who apply to transfer an existing hazardous 
materials endorsement from one State to another, the second State will 
not require the applicant to undergo a new security threat assessment 
until the security threat assessment renewal period established in the 
preceding issuing State, not to exceed five years, expires.
    (h) Each State must retain the application and information required 
in Sec.  1572.9 for at least one year in paper or electronic form.


Sec.  1572.15  Procedures for security threat assessment.

    (a) Contents of security threat assessment. The security threat 
assessment TSA completes includes a fingerprint-based criminal history 
records check, an intelligence-related background check, and a final 
disposition.
    (b) Fingerprint-based check. In order to conduct a fingerprint-
based criminal history records check, the following procedures must be 
completed:
    (1) The State notifies the applicant that he or she will be subject 
to the security threat assessment at least 60 days prior to the 
expiration of the applicant's HME and that the applicant must begin the 
security threat assessment no later than 30 days before the date of the 
expiration of the HME.
    (2) Where the State elects to collect fingerprints and applicant 
information under Sec.  1572.13(f)(1), the State--
    (i) Collects fingerprints and applicant information required in 
Sec.  1572.9;
    (ii) Provides the applicant information to TSA electronically, 
unless otherwise authorized by TSA;
    (iii) Transmits the fingerprints to the FBI/CJIS in accordance with 
the FBI/CJIS fingerprint submission standards; and
    (iv) Retains the signed application, in paper or electronic form, 
for one year and provides it to TSA if requested.
    (3) Where the State elects to have TSA/TSA agent collect 
fingerprints and applicant information under Sec.  1572.13(f)(2)--
    (i) TSA provides a copy of the signed application to the State;
    (ii) The State retains the signed application, in paper or 
electronic form, for one year and provides it to TSA if requested; and
    (iii) TSA transmits the fingerprints to the FBI/CJIS in accordance 
with the FBI/CJIS fingerprint submission standards.
    (4) TSA receives the results from the FBI/CJIS and adjudicates the 
results of the check in accordance with Sec.  1572.103 and, if 
applicable, Sec.  1572.107.
    (c) Intelligence-related check. To conduct an intelligence-related 
check, the following procedures are completed:
    (1) TSA reviews the applicant information required in Sec.  1572.9;
    (2) TSA searches domestic and international government databases 
described in Sec. Sec.  1572.105, 1572.107, and 1572.109;
    (3) TSA adjudicates the results of the check in accordance with 
Sec. Sec.  1572.103, 1572.105, 1572.107, and 1572.109.
    (d) Final Disposition. Following completion of the procedures 
described in paragraphs (b) and/or (c) of this section, the following 
procedures apply, as appropriate:
    (1) TSA serves a Determination of No Security Threat on the State 
in which the applicant is authorized to hold an HME, if TSA determines 
that an applicant meets the security threat assessment standards 
described in Sec.  1572.5.
    (2) TSA serves an Initial Determination of Threat Assessment on the 
applicant if TSA determines that the applicant does not meet the 
security threat assessment standards described in Sec.  1572.5. The 
Initial Determination of Threat Assessment includes--
    (i) A statement that TSA has determined that the applicant poses or 
is suspected of posing a security threat warranting denial of the HME;
    (ii) The basis for the determination;
    (iii) Information about how the applicant may appeal the 
determination, as described in Sec.  1572.141; and
    (iv) A statement that if the applicant chooses not to appeal TSA's 
determination within 30 days after receipt of the Initial 
Determination, or does not request an extension of time within 30 days 
after receipt of the Initial Determination in order to file an appeal,

[[Page 68746]]

the Initial Determination becomes a Final Determination of Security 
Threat Assessment.
    (3) TSA serves an Initial Determination of Threat Assessment and 
Immediate Revocation on the applicant and the State, if TSA determines 
that the applicant does not meet the security threat assessment 
standards described in Sec.  1572.5 and may pose an imminent threat to 
transportation or national security, or of terrorism. The Initial 
Determination of Threat Assessment and Immediate Revocation includes--
    (i) A statement that TSA has determined that the applicant poses or 
is suspected of posing a security threat warranting immediate 
revocation of an HME;
    (ii) The basis for the determination;
    (iii) Information about how the applicant may appeal the 
determination, as described in Sec.  1572.141(i); and
    (iv) A statement that if the applicant chooses not to appeal TSA's 
determination within 30 days after receipt of the Initial Determination 
and Immediate Revocation, the Initial Determination and Immediate 
Revocation becomes a Final Determination of Threat Assessment.
    (4) TSA serves a Final Determination of Threat Assessment on the 
State in which the applicant applied for the HME and on the applicant, 
if the appeal of the Initial Determination results in a finding that 
the applicant poses a security threat.
    (5) TSA serves a Withdrawal of the Initial Determination of Threat 
Assessment or a Withdrawal of Final Determination of Threat Assessment 
on the applicant and a Determination of No Security Threat on the 
State, if the appeal results in a finding that the applicant does not 
pose a threat to security, or if TSA grants the applicant a waiver 
pursuant to Sec.  1572.143.

Subpart B--Standards, Appeals, and Waivers for Security Threat 
Assessments


Sec.  1572.101  Scope.

    This subpart applies to applicants who hold or are applying to 
renew or transfer an HME.


Sec.  1572.103  Disqualifying criminal offenses.

    (a) Permanent disqualifying criminal offenses. An applicant has a 
permanent disqualifying offense if convicted or found not guilty by 
reason of insanity in a civilian or military jurisdiction of any of the 
following felonies:
    (1) Espionage.
    (2) Sedition.
    (3) Treason.
    (4) A crime listed in 18 U.S.C. Chapter 113B--Terrorism, or a State 
law that is comparable.
    (5) A crime involving a transportation security incident.
    (6) Improper transportation of a hazardous material under 49 U.S.C. 
5124 or a State law that is comparable.
    (7) Unlawful possession, use, sale, distribution, manufacture, 
purchase, receipt, transfer, shipping, transporting, import, export, 
storage of, or dealing in an explosive or explosive device.
    (8) Murder.
    (9) Conspiracy or attempt to commit the crimes in this paragraph 
(a).
    (10) Violations of the Racketeer Influenced and Corrupt 
Organizations Act, 18 U.S.C. 1961, et seq., or a State law that is 
comparable, where one of the predicate acts found by a jury or admitted 
by the defendant, consists of one of the offenses listed in paragraphs 
(a)(4) or (a)(8) of this section.
    (b) Interim disqualifying criminal offenses. The felonies listed in 
paragraphs (b)(1) through (b)(14) of this section are disqualifying if 
either of the following factors is true: the applicant was convicted or 
found not guilty by reason of insanity of the crime in a civilian or 
military jurisdiction, within the 7 years preceding the date of 
application; or the applicant was released from incarceration for the 
crime within the 5 years preceding the date of application.
    (1) Assault with intent to murder.
    (2) Kidnapping or hostage taking.
    (3) Rape or aggravated sexual abuse.
    (4) Unlawful possession, use, sale, manufacture, purchase, 
distribution, receipt, transfer, shipping, transporting, delivery, 
import, export of, or dealing in a firearm or other weapon.
    (5) Extortion.
    (6) Dishonesty, fraud, or misrepresentation, including identity 
fraud.
    (7) Bribery.
    (8) Smuggling.
    (9) Immigration violations.
    (10) Violations of the Racketeer Influenced and Corrupt 
Organizations Act, 18 U.S.C. 1961, et seq., or a State law that is 
comparable, other than the violations listed in paragraph (a)(10) of 
this section.
    (11) Robbery.
    (12) Distribution of, possession with intent to distribute, or 
importation of a controlled substance.
    (13) Arson.
    (14) Conspiracy or attempt to commit the crimes in this paragraph 
(b).
    (c) Under want or warrant. An applicant who is wanted or under 
indictment in any civilian or military jurisdiction for a felony listed 
in this section is disqualified until the want or warrant is released.
    (d) Determination of arrest status. (1) When a fingerprint-based 
check discloses an arrest for a disqualifying crime listed in this 
section without indicating a disposition, TSA will so notify the 
applicant and provide instructions on how the applicant must clear the 
disposition, in accordance with paragraph (d)(2) of this section.
    (2) The applicant must provide TSA with written proof that the 
arrest did not result in a disqualifying criminal offense within 45 
days after the service date of the notification in paragraph (d)(1) of 
this section. If TSA does not receive proof in that time, TSA will 
notify the applicant and the State that the applicant is disqualified 
from holding an HME.


Sec.  1572.105  Immigration status.

    (a) An applicant applying for a security threat assessment for an 
HME must be--
    (1) A citizen of the United States who has not renounced or lost 
his or her United States' citizenship; or
    (2) A lawful permanent resident of the United States, as defined in 
section 101(a)(20) of the Immigration and Nationality Act (8 U.S.C. 
1101); or
    (3) An individual who is--
    (i) In lawful nonimmigrant status and possesses valid evidence of 
unrestricted employment authorization; or
    (ii) A refugee admitted under 8 U.S.C. 1157 and possesses valid 
evidence of unrestricted employment authorization; or
    (iii) An alien granted asylum under 8 U.S.C. 1158, and possesses 
valid evidence of unrestricted employment authorization.
    (b) To determine an applicant's immigration status, TSA checks 
relevant Federal databases and may perform other checks, including 
verifying the validity of the applicant's social security number or 
alien registration number.


Sec.  1572.107  Other analyses.

    (a) An applicant poses a security threat and is therefore 
disqualified under this section when TSA determines or suspects the 
applicant of posing a threat--
    (1) To national security; or
    (2) To transportation security; or
    (3) Of terrorism.
    (b) TSA checks the following databases and analyzes the resulting 
information before determining that an applicant does not pose a 
security threat warranting denial of an HME:
    (1) Interpol and other international databases, as appropriate;
    (2) Terrorist watchlists and related databases; and

[[Page 68747]]

    (3) Any other databases relevant to determining whether an 
applicant poses or is suspected of posing a security threat, or that 
confirm an applicant's identity.
    (c) TSA may determine that an applicant poses a security threat if 
the search conducted under this part reveals extensive foreign or 
domestic criminal convictions; a conviction for a serious crime not 
listed in Sec.  1572.103, or a period of foreign or domestic 
imprisonment that exceeds 365 consecutive days.


Sec.  1572.109  Mental capacity.

    (a) An applicant has lacking mental capacity if he or she has 
been--
    (1) Adjudicated as lacking mental capacity; or
    (2) Committed to a mental institution.
    (b) An applicant is adjudicated as lacking mental capacity if--
    (1) A court, board, commission, or other lawful authority has 
determined that the applicant, as a result of marked subnormal 
intelligence, mental illness, incompetence, condition, or disease, is a 
danger to him- or herself or others, or lacks the mental capacity to 
contract or manage his or her own affairs.
    (2) This includes a finding of insanity by a court in a criminal 
case; and a finding of incompetence to stand trial or a finding of not 
guilty by reason of lack of mental responsibility by any court, or 
pursuant to articles 50a and 76b of the Uniform Code of Military 
Justice (10 U.S.C. 850a and 876b).
    (c) An applicant is committed to a mental institution if he or she 
is formally committed to a mental institution by a court, board, 
commission, or other lawful authority, including involuntary commitment 
and commitment for lacking mental capacity, mental illness, and drug 
use. This does not include a commitment to a mental institution for 
observation or voluntary admission to a mental institution.


Sec. Sec.  1572.111-1572.139  [Reserved]


Sec.  1572.141  Appeal procedures.

    (a) Scope. This section applies to applicants who wish to appeal an 
Initial Determination of Threat Assessment.
    (b) Grounds for Appeal. An applicant may appeal an Initial 
Determination of Threat Assessment if the applicant is asserting that 
he or she meets the security threat assessment standards identified in 
Sec.  1572.5(c).
    (c) Appeal. An applicant initiates an appeal by submitting a 
written reply to TSA or written request for materials from TSA. If the 
applicant fails to initiate an appeal within 30 days after receipt, the 
Initial Determination of Threat Assessment becomes final, and TSA 
serves a Final Determination of Threat Assessment on the State in which 
the applicant applied.
    (1) Request for materials. Within 30 days after the date of service 
of the Initial Determination of Threat Assessment, the applicant may 
serve upon TSA a written request for copies of the materials upon which 
the Initial Determination was based.
    (2) TSA response. (i) Within 30 days after receiving the 
applicant's request for materials, TSA serves copies of the releasable 
materials upon the applicant on which the Initial Determination was 
based. TSA will not include any classified information or other 
protected information described in paragraph (f) of this section.
    (ii) Within 30 days after receiving the applicant's request for 
materials or written reply, TSA may request additional information or 
documents from the applicant that TSA believes are necessary to make a 
Final Determination.
    (3) Correction of records. If the Initial Determination of Threat 
Assessment was based on a record that the applicant believes is 
erroneous, the applicant may correct the record, as follows:
    (i) The applicant may contact the jurisdiction or entity 
responsible for the information and attempt to correct or complete 
information contained in his or her record.
    (ii) The applicant must provide TSA with the revised record, or a 
certified true copy of the information from the appropriate entity, 
before TSA may determine that the applicant meets the standards for the 
security threat assessment.
    (4) Reply. (i) The applicant may serve upon TSA a written reply to 
the Initial Determination of Threat Assessment within 30 days after 
service of the Initial Determination, or 30 days after the date of 
service of TSA's response to the applicant's request for materials 
under paragraph (d)(2) of this section, if the applicant served such 
request. The reply must include the rationale and information on which 
the applicant disputes TSA's Initial Determination.
    (ii) In an applicant's reply, TSA will consider only material that 
is relevant to whether the applicant meets the standards described in 
paragraph (d) of this section for the security threat assessment in 
paragraph (b) of this section.
    (5) Final determination. Within 30 days after TSA receives the 
applicant's reply, TSA serves a Final Determination of Threat 
Assessment or a Withdrawal of the Initial Determination as provided in 
paragraphs (d) or (e) of this section.
    (d) Final Determination of Threat Assessment. (1) In the case of an 
appeal of an Initial Determination of Threat Assessment that is based 
on criminal offense under Sec.  1572.103; immigration status under 
Sec.  1572.105; or mental competency under Sec.  1572.109; if the 
Director concludes that the applicant does not meet the security threat 
assessment standards described in Sec.  1572.5, TSA serves a Final 
Determination of Threat Assessment upon the applicant and the issuing 
State.
    (2) In the case of an appeal of an Initial Determination of Threat 
Assessment that is based on a threat to national security or 
transportation security, or of terrorism under Sec.  1572.107, if the 
Assistant Secretary concludes that the applicant does not meet the 
security threat assessment standards described in Sec.  1572.5, TSA 
serves a Final Determination of Threat Assessment upon the applicant 
and issuing State.
    (3) The Final Determination includes a statement that the Director 
or Assistant Secretary has reviewed the Initial Determination, the 
applicant's reply and any accompanying information, if any, and any 
other materials or information available to him or her and has 
determined that the applicant poses a security threat warranting denial 
of an HME.
    (e) Withdrawal of Initial Determination. If the Director or 
Assistant Secretary concludes that the applicant does not pose a 
security threat warranting denial of the HME, TSA serves a Withdrawal 
of the Initial Determination upon the applicant.
    (f) Nondisclosure of certain information. In connection with the 
procedures under this section, TSA does not disclose classified 
information to the applicant, as defined in Executive Order 12968 
section 1.1(d), and reserves the right not to disclose any other 
information or material not warranting disclosure or protected from 
disclosure under law.
    (g) Extension of time. TSA may grant an applicant an extension of 
time of the limits described in this section for good cause shown. An 
applicant's request for an extension of time must be in writing and be 
received by TSA within a reasonable time before the due date to be 
extended. TSA may grant itself an extension of time for good cause.
    (h) Judicial review. For purposes of judicial review, the Final 
Determination of Threat Assessment constitutes a final TSA order in 
accordance with 49 U.S.C. 46110.

[[Page 68748]]

    (i) Appeal of immediate revocation. (1) If TSA directs a State to 
revoke an HME pursuant to Sec.  1572.13(a) by issuing an Initial 
Determination of Threat Assessment and Immediate Revocation, the 
applicant may appeal this determination by following the appeal 
procedures described in paragraph (c) of this section.


Sec.  1572.143  Waiver procedures.

    (a) Scope. This section applies to an applicant who--
    (1) Has a disqualifying criminal offense described in Sec.  
1572.103(a)(5) through (a)(9), and paragraph 1572.103(a)(10) if the 
underlying criminal offense is in paragraphs 1572.103(a)(5) through 
(a)(9); or
    (2) Has a disqualifying criminal offense described in Sec.  
1572.103(b); or
    (3) Lacks mental capacity as described in Sec.  1572.109.
    (b) Waivers. (1) An applicant initiates a waiver request by sending 
a written request to TSA for a waiver at any time, but not later than 
30 days after the date of service of the Final Determination of Threat 
Assessment.
    (2) In determining whether to grant a waiver, TSA will consider the 
following factors:
    (i) The circumstances of the disqualifying act or offense;
    (ii) Restitution made by the applicant;
    (iii) Any Federal or State mitigation remedies;
    (iv) Court records or official medical release documents indicating 
that the individual no longer lacks mental capacity;
    (v) Other factors that indicate the applicant does not pose a 
security threat warranting denial of the HME.
    (c) Grant or denial of waivers. The Director will send a written 
decision granting or denying the waiver to the applicant and a 
Determination of No Security Threat to the State in which the applicant 
applied for the HME, within 30 days after service the applicant's 
request for a waiver, or longer period as TSA may determine for good 
cause.
    (d) Extension of time. TSA may grant an applicant an extension of 
time of the limits described in paragraph (b) and (c) of this section 
for good cause shown. An applicant's request for an extension of time 
must be in writing and be received by TSA within a reasonable time 
before the due date to be extended. TSA may grant itself an extension 
of time for good cause.

Subpart C--Transportation of Explosives From Foreign Locations


Sec.  1572.201  Transportation of explosives from Canada to the United 
States via commercial motor vehicle.

    (a) Applicability. This section applies to carriers that carry 
explosives from Canada to the United States using a driver who is not a 
United States citizen or lawful permanent resident alien of the United 
States.
    (b) Terms used in this section. For purposes of this section:
    Carrier means any ``motor carrier'' or ``motor private carrier'' as 
defined in 49 U.S.C. 13102(12) and (13), respectively.
    Customs Service means the United States Customs Service.
    Explosive means a material that has been examined by the Associate 
Administrator for Hazardous Materials Safety, Research and Special 
Programs Administration, in accordance with 49 CFR 173.56, and 
determined to meet the definition for a Class 1 material in 49 CFR 
173.50.
    Known carrier means a person that has been determined by the 
Governments of Canada and the United States to be a legitimate business 
operating in accordance with all applicable laws and regulations 
governing the transportation of explosives.
    Known driver means a driver of a motor vehicle who has been 
determined by the Governments of Canada and the United States to 
present no known security concern.
    Known offeror means an offeror that has been determined by the 
Governments of Canada and the United States to be a legitimate business 
operating in accordance with all applicable laws and regulations 
governing the transportation of explosives.
    Lawful permanent resident alien means a lawful permanent resident 
alien of the United States as defined by 8 U.S.C. 1101(a)(2).
    Offeror means the person offering a shipment to the carrier for 
transportation from Canada to the United States, and may also be known 
as the ``consignor'' in Canada.
    (c) Prior approval of carrier, offeror, and driver. (1) No carrier 
may transport in commerce any explosive into the United States from 
Canada via motor vehicle if the driver of the vehicle is a not a United 
States citizen or lawful permanent resident alien unless the carrier, 
offeror, and driver are identified on a TSA list as a known carrier, 
known offeror, and known driver, respectively.
    (2) The carrier must ensure that it, its offeror, and its driver 
have been determined to be a known carrier, known offeror, and known 
driver, respectively. If any has not been so determined, the carrier 
must submit the following information to Transport Canada:
    (i) The carrier must provide its:
    (A) Official name;
    (B) Business number;
    (C) Any trade names; and
    (D) Address.
    (ii) The following information about any offeror of explosives 
whose shipments it will carry:
    (A) Official name;
    (B) Business number; and
    (C) Address.
    (iii) The following information about any driver the carrier may 
use to transport explosives into the United States from Canada who is 
neither a United States citizen nor lawful permanent resident alien of 
the United States:
    (A) Full name;
    (B) Canada Commercial Driver's License number; and
    (C) Both current and most recent prior residential addresses.
    (3) Transport Canada will determine that the carrier and offeror 
are legitimately doing business in Canada and will also determine that 
the drivers are properly licensed and present no known problems for 
purposes of this section. Transport Canada will notify TSA of these 
determinations by forwarding to TSA lists of known carriers, offerors, 
and drivers and their identifying information.
    (4) TSA will update and maintain the list of known carriers, 
offerors, and drivers and forward the list to the Customs Service.
    (5) Once included on the list, the carriers, offerors, and drivers 
need not obtain prior approval for future transport of explosives under 
this section.
    (d) TSA checks. TSA may periodically check the data on the 
carriers, offerors and drivers to confirm their continued eligibility 
and may remove from the list any that TSA determines is not known or is 
a threat to security.
    (e) At the border--
    (1) Driver who is not a United States citizen or lawful permanent 
resident alien. Upon arrival at the border, and prior to entry into the 
United States, the driver must provide a valid Canadian commercial 
driver's license to the Customs Service.
    (2) Driver who is a United States citizen or lawful permanent 
resident alien. If the Customs Service cannot verify that the driver is 
on the list, and if the driver is a United States citizen or lawful 
permanent resident alien, the

[[Page 68749]]

driver may be cleared by the Customs Service upon providing:
    (i) A valid United States passport; or
    (ii) One or more other document(s) including a form of United 
States Federal or state government-issued identification with 
photograph, acceptable to the Customs Service.
    (3) Compliance. If a carrier attempts to enter the United States 
without having complied with this section, the Customs Service will 
deny entry of the explosives and may take other appropriate action.


Sec.  1572.203  Transportation of explosives from Canada to the United 
States via railroad carrier.

    (a) Applicability. This section applies to railroad carriers that 
carry explosives from Canada to the United States using a train crew 
member who is not a United States citizen or lawful permanent resident 
alien of the United States.
    (b) Terms under this section. For purposes of this section:
    Customs Service means the United States Customs Service.
    Explosive means a material that has been examined by the Associate 
Administrator for Hazardous Materials Safety, Research and Special 
Programs Administration, in accordance with 49 CFR 173.56, and 
determined to meet the definition for a Class 1 material in 49 CFR 
173.50.
    Known railroad carrier means a person that has been determined by 
the Governments of Canada and the United States to be a legitimate 
business operating in accordance with all applicable laws and 
regulations governing the transportation of explosives.
    Known offeror means an offeror that has been determined by the 
Governments of Canada and the United States to be a legitimate business 
operating in accordance with all applicable laws and regulations 
governing the transportation of explosives.
    Known train crew member means an individual used to transport 
explosives from Canada to the United States who has been determined by 
the Governments of Canada and the United States to present no known 
security concern.
    Lawful permanent resident alien means a lawful permanent resident 
alien of the United States as defined by 8 U.S.C. 1101(a)(2).
    Offeror means the person offering a shipment to the railroad 
carrier for transportation from Canada to the United States, and may 
also be known as the ``consignor'' in Canada.
    Railroad carrier means ``railroad carrier'' as defined in 49 U.S.C. 
20102.
    (c) Prior approval of railroad carrier, offeror, and train crew 
member. (1) No railroad carrier may transport in commerce any explosive 
into the United States from Canada via a train operated by a crew 
member who is not a United States citizen or lawful permanent resident 
alien unless the railroad carrier, offeror, and train crew member are 
identified on a TSA list as a known railroad carrier, known offeror, 
and known train crew member, respectively.
    (2) The railroad carrier must ensure that it, its offeror, and each 
of its crew members have been determined to be a known railroad 
carrier, known offeror, and known train crew member, respectively. If 
any has not been so determined, the railroad carrier must submit the 
following information to Transport Canada:
    (i) The railroad carrier must provide its:
    (A) Official name;
    (B) Business number;
    (C) Any trade names; and
    (D) Address.
    (ii) The following information about any offeror of explosives 
whose shipments it will carry:
    (A) Official name;
    (B) Business number; and
    (C) Address.
    (iii) The following information about any train crew member the 
railroad carrier may use to transport explosives into the United States 
from Canada who is neither a United States citizen nor lawful permanent 
resident alien:
    (A) Full name; and
    (B) Both current and most recent prior residential addresses.
    (3) Transport Canada will determine that the railroad carrier and 
offeror are legitimately doing business in Canada and will also 
determine that the train crew members present no known problems for 
purposes of this section. Transport Canada will notify TSA of these 
determinations by forwarding to TSA lists of known railroad carriers, 
offerors, and train crew members and their identifying information.
    (4) TSA will update and maintain the list of known railroad 
carriers, offerors, and train crew members and forward the list to the 
Customs Service.
    (5) Once included on the list, the railroad carriers, offerors, and 
train crew members need not obtain prior approval for future transport 
of explosives under this section.
    (d) TSA checks. TSA may periodically check the data on the railroad 
carriers, offerors, and train crew members to confirm their continued 
eligibility and may remove from the list any that TSA determines is not 
known or is a threat to security.
    (e) At the border (1) Train crew members who are not United States 
citizens or lawful permanent resident aliens. Upon arrival at a point 
designated by the Customs Service for inspection of trains crossing 
into the United States, the train crew members of a train transporting 
explosives must provide sufficient identification to the Customs 
Service to enable that agency to determine if each crew member is on 
the list of known train crew members maintained by TSA.
    (2) Train crew members who are United States citizens or lawful 
permanent resident aliens. If the Customs Service cannot verify that 
the crew member is on the list and the crew member is a United States 
citizen or lawful permanent resident alien, the crew member may be 
cleared by the Customs Service upon providing:
    (i) A valid United States passport; or
    (ii) One or more other document(s) including a form of United 
States Federal or state government-issued identification with 
photograph, acceptable to the Customs Service.
    (3) Compliance. If a carrier attempts to enter the United States 
without having complied with this section, the Customs Service will 
deny entry of the explosives and may take other appropriate action.

    Issued in Arlington, Virginia on November 19, 2004.
David M. Stone,
Assistant Secretary.
[FR Doc. 04-26066 Filed 11-19-04; 4:33 pm]
BILLING CODE 4910-62-P


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