Regulatory Flexibility Determination The Regulatory Flexibility Act of 1980 (RFA) establishes “as a principle of regulatory issuance that agencies shall endeavor, consistent with the objective of the rule and of applicable statutes, to fit regulatory and informational requirements to the scale of the business, organizations, and governmental jurisdictions subject to regulation.” To achieve that principle, the RFA requires agencies to solicit and consider flexible regulatory proposals and to explain the r ationale for their actions. 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 proposed or final rule will ha ve 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 Act.

This proposed rule would impact p art 135 operators and s maller air services businesses.

Part 135 Operators The U.S. Small Business Administration (SBA) classifies businesses as small based on size standards, typically expressed as number of employees. T he FAA identified 609 part 13 5 operators that meet the Sm all Business Administration definition of a small entity ( entities with 1,500 or fewer employees ) out of the 610 part 13 5 operators affected by this proposed rule

. We consider this a substantial number of small entities.

For the 609 part 135 small operators, w e estimate cost s that range between $14 thousand and $ 1.2 million for adopting this airworthiness directive. We also estimated the value of theiraircraft, which ranges between $22 thousand and $21 million. Using the preceding information,
t he FAA estimates that their rat io of annualized cost to asset value are higher than 5 percent for 432 part 135 operators

.

Smaller air services businesses We estimate that more than 5,000 smaller air services businesses would be affected by this proposed rule

. We consider this a substantial number of small entities. For each of these entities we estimate d costs of about $14 thousand although we were unable to estimate their asset value.

The FAA decided that the rule would have a significant economic impact on a substantial number of entities . Therefore, we have performed a re gulatory flexibility analysis for the se small entities

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Initial Regulatory Flexibility Analysis Under Section 603(b) of the RFA, the initial analysis must address:

 Description of reasons the agency is considering the action

 Statement of the legal basis and objectives for the proposed rule

 Description of the record keeping and other compliance requirements of the proposed rule

 All federal rules that may duplicate, ove rlap, or conflict with the proposed rule

 Description and an estimated number of small entities to whi ch the proposed rule will apply

 Describe alternatives consideredDescription of reasons the agency is considering the action This proposed AD was prom pted by failure reports of multiple cylinder head

- to

- barrel separations and cracked and leaking aluminum cylinder heads.
Statement of the legal basis and objectives for the proposed rule Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII: Aviation Programs, describes in more detail the scope of the Agency's authority.
We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701: “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedu res the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

Description of the record keeping and other compliance requirements of the proposed rule Public reporting for this collection of information is estimated to be approximately 5 minutes per response, including the time for reviewing instructions, completing and reviewing the collection of information. Total paperwork costs range between $ 7 and $623 per small entity

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All federal rules that may duplicate, overlap, or conflict with the proposed rule The FAA is unaware of any Federal rules that duplicate, overlap, or conflict with this rule.Description and an estimated number of small entities to which the proposed rule will apply The FAA identified 432 small part 135 operators on which the rule will have a significant economic impact. We estimate that the small part 135 operators have assets valued between $22 thousand and $21 million.

De scribe alt ernatives considered We have considered the following alternatives:

• Do nothing

- This option is not acceptable due to the number of failures of ECi cylinde r head assemblies and the consequences of the failures.

• Periodic inspections only (no forced removals)

- Though the NTSB recommends this option, we do not find it acceptable. The rate of crack growth to failure is unknown, but has shown that it can be mor e rapid than the intervals of Part 43 mandated inspections. Further, failure events tend to group in both low time (<500 hr) failure events and high time (>1000 hr) failure events.

• Forced removals only (no periodic inspections)

- We do not find that this option is acceptable. Failure events may still occur at times other than the low and high times groups described above, and periodic inspections may find impending failures.