Vulcanair AD Final Regulatory Flexibility Analysis

George Euring

Draft: 12/04/2013(Revised 04-24-2014)

Introduction and Purpose of This Analysis

The Regulatory Flexibility Act of 1980 (Public Law 96-354) (RFA) establishes “as a 

principle of regulatory issuance that agencies shall endeavor, consistent with the objectives of 

the rule and of applicable statutes, to fit regulatory and informational requirements to the 

scale of the businesses, organizations, and governmental jurisdictions subject to regulation. 

To achieve this principle, agencies are required to solicit and consider flexible regulatory 

proposals and to explain the rationale for their actions to assure that such proposals are given 

serious consideration.” The RFA covers a wide-range of small entities, including small 

businesses, not-for-profit organizations, and small governmental jurisdictions.

Agencies must perform a review to determine whether a rule will have a significant 

economic impact on a substantial number of small entities. If the agency determines that it 

will, the agency must prepare a regulatory flexibility analysis as described in the RFA. 

Final Regulatory Flexibility Analysis (FRFA)

Section 604 of the Act requires agencies to prepare a final regulatory flexibility 

analysis (FRFA) describing the impact of final rules on small entities. 

Section 604(a) of the Act specifies the content of an FRFA.

Each FRFA must contain:

1. A statement of the need for, and objectives of, the rule;

2. A statement of the significant issues raised by the public comments in 

response to the initial regulatory flexibility analysis, a statement of the assessment 

of the agency of such issues, and a statement of any changes made in the proposed 

rule as a result of such comments;
3. The response of the agency to any comments filed by the Chief Counsel for 

Advocacy of the Small Business Administration in response to the proposed rule, 

and a detailed statement of any change made to the proposed rule in the final rule 

as a result of the comments;

4. A description of and an estimate of the number of small entities to which the 

rule will apply or an explanation of why no such estimate is available;

5. A description of the projected reporting, recordkeeping and other compliance 

requirements of the rule, including an estimate of the classes of small entities 

which will be subject to the requirement and the type of professional skills 

necessary for preparation of the report or record; and

6. A description of the steps the agency has taken to minimize the significant 

economic impact on small entities consistent with the stated objectives of 

applicable statutes, including a statement of the factual, policy, and legal reasons 

for selecting the alternative adopted in the final rule and why each one of the other 

significant alternatives to the rule considered by the agency which affect the 

impact on small entities was rejected.

1. Need For and Objective of This Final Rule

This final AD results from mandatory continuing airworthiness information (MCAI) 

originated by EASA and will supersede existing AD 2008-24-11. The existing AD 

established safe limits for the wing structure of Vulcanair P.68 Series airplanes and requires 

repetitive inspection and repair of the wing and stabilator structures when the airplanes reach 

safe life limits. Operation beyond existing conservative safe limits (with inspections and 

repair) is allowed pending establishment of final safe limits and a terminating action. 
This final AD significantly increases wing structure life limits (in a few cases 

requiring kit modification of the wing structure), but establishes a terminating action 

requiring replacement of the wing structure and wing fuselage attachments and bolts when 

new established safe limits are reached. Prior to the wing structure safe life limit being

reached, the final AD also requires special inspections of the wing structure with time limits, 

since new, of 6,000, 12,000, and 18,000 flight hours.1

2. Response to Public Comments

There were no public comments on the initial Regulatory Flexibility Analysis (IRFA). 

3. Response to Comments by the Chief Counsel for Advocacy of the Small Business 

Administration 

There were no comments made by the Chief Counsel for Advocacy. 

4. A Description of and an Estimate of the Number of Small Entities to which the Final 

Rule Will Apply

This final rule will affect 67 U.S.-registered airplanes. Forty eight of these airplanes are 

owned by private entities and 19 of these airplanes are owned by governmental entities. 

Of the 48 airplanes owned by private entities, one trustee owns 3 airplanes, one trustee 

owns 2 airplanes, and two companies each own two airplanes (2+2). The remaining 39 

airplanes are owned by 39 corporations and individuals. The FAA believes that all, or nearly 

all, of these private sector owners are privately held small firms, for which we cannot obtain 

financial records.

Of the 19 airplanes owned by governmental entities, 2 are owned by the federal 

government and 17 are owned by state governments. 

We conclude that the final rule will affect a substantial number of small entities. 

5. Reporting, Record Keeping, and Other Compliance Requirements of the Final Rule

 1 After the first special inspection subsequent inspections must be every 6000 flight hours thereafter.
Small entities will incur no new reporting and record-keeping requirements as a result 

of this final rule. 

The additional requirements of this final AD compared to the existing AD are the 

special wing structure inspections at 6,000, 12,000, and 18,000 flight hours, the terminating 

action to replace the wing structure when the wing structure safe limit is reached, and, for 

airplanes with serial numbers 1- 256 for which a spar crack was found under previous 

Vulcanair SB65, replacement of the four main spar lower cap angles using Vulcanair Kit 

SB162. The costs of the required actions provided in the final AD are as follows:

Requirement

WorkhoursLabor 

Cost

Cost of 

Materials

Total 

Cost

Special inspections 60 $ 5,100 

Wing structure replacement 300 $ 25,500 $443,406 $468,906 

Replacement of lower spar 

cap angles with kit SB162 

(S/N 1-256) 120 $ 10,200 $ 2,595 $ 12,795 

Notes: 1. Labor cost per hour is $85. The cost of crack repair is not provided in the final AD.

The requirement to replace the wing structure, at considerable cost, occurs when the 

airplanes are old and have low value, often less than the cost of wing structure replacement.

Therefore, in many cases airplane retirement is the least cost alternative, in which case the 

effective cost of the requirement is the loss in airplane value net of salvage value. The 

requirement to replace the lower spar cap angles applies to at most ten U.S.-registered 

airplanes and only if a front spar crack was previously found under SB No. 65. The expected 

present value cost of this requirement is thus minimal. The requirement for special 

inspections at 6,000, 12,000, and 18,000 flight hours applies to all AD-affected airplanes. 

Economic Impact on Small Entities

Since we have no financial information of the privately held firms that constitute most 

of the operators of the affected airplanes, we assess the economic impact of this final rule 
using airplane values. As the Vulcanair P.68 airplanes are not listed in the Aircraft Bluebook 

Price Digest, we undertook an internet search and found that the resale value of older P.68 

airplanes, manufactured between 1975 and 1984 ranged from about $80,000 to $300,000. 

Many of these airplanes will be subject to the special inspection at 6,000 flight hours or even 

the special inspection at 12,000 flight hours. Using a significant economic impact criterion of 

2% of airplane value, for operators of many of these airplanes there is a significant economic 

impact based on just one $5,100 inspection. Taking into account the present value cost of 2-3 

possible future inspections and possible repair, as well as the present value cost of forced 

early retirement, there is a significant economic impact on most if not all of these operators. 

We therefore conclude that this final rule will have a significant impact on a 

substantial number of small firms. 

6. Steps the Agency has Taken to Minimize the Significant Economic Impact on Small 

Entities

Because of an unsafe condition that is likely to exist or develop on the airplanes 

identified in this final AD, there is no feasible significant alternative to requiring the actions 

of this final AD. Therefore, there are no steps that the Agency can take to minimize the 

significant economic impact on small entities. 

Therefore this final rule will have a significant economic impact on a substantial 

number of small entities.