55108 Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 

1The FAA published a notice of proposed 

rulemaking (NPRM) that proposed the changes to 

part 420 that the FAA is now adopting. Explosive 

Siting Requirements, 76 FR 8923 (Feb. 16, 2011). 

TABLE 1—AIRPLANES SUBJECT TO § 26.21—Continued 

Airplane model Compliance Date—months after 

January 14, 2011 

Default LOV 

[flight cycles (FC) 

or flight hours (FH)] 

All Other Airplane Models (TCs and amended TCs) not Listed in Table 2 ..... 72, or within 12 months after 

the LOV is approved, or before operating the airplane, 

whichever occurs latest.

Not applicable. 

1Type certificated as of January 14, 2011. 

Note: Airplane operation limitation is stated in the Airworthiness Limitation section. 

* * * * * 

Issued in Washington, DC, on August 24, 

2012. 

Lirio Liu, 

Acting Director, Office of Rulemaking. 

[FR Doc. 2012–22090 Filed 9–6–12; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 420 

[Docket No. FAA–2011–0105; Amdt. No. 

420–6] 

RIN 2120–AJ73 

Explosive Siting Requirements 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Final rule. 

SUMMARY: This rule amends the 

requirements for siting explosives under 

a license to operate a launch site. It 

increases flexibility for launch site 

operators in site planning for the storage 

and handling of energetic liquids and 

explosives. 

DATES: Effective November 6, 2012. 

ADDRESSES: For information on where to 

obtain copies of rulemaking documents 

and other information related to this 

final rule, see ‘‘How To Obtain 

Additional Information’’ in the 

SUPPLEMENTARY INFORMATION section of 

this document. 

FOR FURTHER INFORMATION CONTACT: For 

technical questions concerning this final 

rule contact Yvonne Tran, Commercial 

Space Transportation, Federal Aviation 

Administration, 800 Independence 

Avenue SW., Washington, DC 20591; 

telephone (202) 267–7908; facsimile 

(202) 267–5463, email 

yvonne.tran@faa.gov. For legal 

questions concerning this final rule 

contact Laura Montgomery, AGC 200, 

Senior Attorney for Commercial Space 

Transportation, Office of the Chief 

Counsel, Federal Aviation 

Administration, 800 Independence 

Avenue SW., Washington, DC 20591; 

telephone (202) 267–3150; facsimile 

(202) 267–7971, email 

laura.montgomery@faa.gov. 

SUPPLEMENTARY INFORMATION: 

Authority for This Rulemaking 

The Commercial Space Launch Act of 

1984, as amended and re-codified at 51 

United States Code (U.S.C.) Subtitle V— 

Commercial Space Transportation, 

ch.509, Commercial Space Launch 

Activities, 51 U.S.C. 50901–50923 (the 

Act), authorizes the Department of 

Transportation (DOT) and thus the FAA, 

through delegations, to oversee, license, 

and regulate commercial launch and 

reentry activities, and the operation of 

launch and reentry sites as carried out 

by U.S. citizens or within the United 

States. 51 U.S.C. 50904, 50905. 

Authority for this particular rulemaking 

is derived from 51 U.S.C. 50905, which 

requires that the FAA issue a license to 

operate a launch site consistent with 

public health and safety. See also 49 

U.S.C. 322(a), 51 U.S.C. 50901(a)(7). 

Section 50901(a)(7) directs the FAA to 

regulate only to the extent necessary to, 

in relevant part, protect the public 

health and safety and safety of property. 

I. Overview of Final Rule 

This final rule amends part 420 of 

Title 14 of the Code of Federal 

Regulations (14 CFR) Chapter III, 

updating the FAA’s requirements for 

how to site explosives under a license 

to operate a launch site.1 Part 420 

establishes criteria for siting facilities at 

a launch site where solid propellants, 

energetic liquids, or other explosives are 

located to prepare launch vehicles and 

payloads for flight. These criteria are 

commonly referred to as quantitydistance (Q–D) requirements because 

they provide minimum separation 

distances between explosive hazard 

facilities, surrounding facilities and 

locations where the public may be 

present on the basis of the type and 

quantity of solid propellants, energetic 

liquids, and other explosives located 

within the area. Minimum separation 

distances are necessary to protect the 

public from explosive hazards. 

The FAA is making a number of 

changes consistent with the goals of 

Executive Order 13610, Identifying and 

Reducing Regulatory Burdens, 77 FR 

28469 (May 14, 2012). First, the FAA is 

dispensing with its separation distance 

requirements at launch sites for storing 

liquid oxygen, nitrogen tetroxide, 

hydrogen peroxide in concentrations 

equal to or below 91 percent, and 

refined petroleum-1 (RP–1). If these 

energetic liquids are not within an 

intraline distance of an incompatible 

energetic liquid or co-located on a 

launch vehicle, the FAA is no longer 

imposing public area separation 

distances because the current separation 

requirements for storing these energetic 

liquids unnecessarily duplicate the 

requirements of the Occupational Safety 

and Health Administration. Second, the 

FAA is decreasing the separation 

distances required for division 1.1 

explosives and liquid propellants with 

trinitrotoluene (TNT) equivalents of less 

than or equal to 450 pounds. Although 

decreased, the revised separation 

requirements will continue to protect 

against hazardous fragments, which are 

defined as having a kinetic energy of 58 

foot-pounds, which is a level of kinetic 

energy capable of causing a fatality. The 

probability of a person six feet tall and 

one foot wide being struck by a 

hazardous fragment at a given 

separation from a given net explosive 

weight (NEW) is one percent, which is 

an equivalent level of safety to today’s 

separation distances. Third, the FAA is 

reducing the separation distances for the 

storage and handling of division 1.3 

explosives, while maintaining a level of 

safety equivalent to current 

requirements. Fourth, the FAA is 

eliminating its own separation distance 

requirements for storing liquid oxidizers 

and Class I, II and III flammable and 

combustible liquids because they 

duplicate the requirements of other 

regulatory regimes. Consistent with the 


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Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 55109 

2The DDESB updated the DOD Standard in 2004. 

Notice of Revision of Department of Defense 

6055.9–STD Department of Defense Ammunition 

and Explosives Safety Standards, 70 FR 24771 (May 

11, 2005) (2004 DOD Standard). DOD released a 

new edition in 2008, but the 2004 changes are the 

ones relevant to this rulemaking. The 2004 DOD 

standard bases its separation distances for storage 

on Occupational Safety and Health Administration 

(OSHA) and NFPA standards for classes I through 

III flammable and combustible liquids and liquid 

oxygen, and on NFPA standards for classes 2 and 

3 liquid oxidizers. The 2004 DOD Standard 

contains less restrictive requirements for explosive 

division 1.1 solid explosives with a net explosive 

weight of less than or equal to 450 pounds, and for 

energetic liquids with a TNT equivalence of less 

than or equal to 450 pounds. The FAA is mirroring 

these requirements now. 

3 XCOR Aerospace, Comments to NPRM (FAA– 

2011–0105), Online posting, http:// 

www.regulations.gov/ 

#!searchResults;rpp=10;po=0;s=faa-2011–0105, 

(May 18, 2011) (referred to as XCOR). 

4Crowl, D.A., Understanding Explosions, AIAA 

Center for Chemical Process Safety (CCPS), 2, 

(2003). 

current Department of Defense (DOD) 

Explosive Siting Board’s (DDESB) and 

National Fire Protection Association 

(NFPA) practice, the FAA is dispensing 

with the hazard groups of tables E–3 

through E–6 of appendix E of part 420 

as a means of classification. This 

revision will conform the FAA’s 

classification to the NFPA classification 

system, which is more commonly used 

to reflect chemical hazards of energetic 

liquids used at commercial launch sites. 

Finally, a site map must now be at a 

sufficient scale to determine compliance 

with part 420. 

II. Background 

In 2000, the FAA issued rules 

governing the storage and handling of 

explosives as part of its regulations 

governing the licensing and operation of 

a launch site. Licensing and Safety 

Requirements for Operation of a Launch 

Site; Final Rule, 65 FR 62812 (Oct. 19, 

2000) (Launch Site Rule). The FAA has 

requirements for obtaining a license to 

operate a launch site in part 420. Part of 

the application for a license requires an 

applicant to provide the FAA with an 

explosive site plan that complies with 

the explosive siting requirements of part 

420. The plan must show how a launch 

site operator will separate explosive 

hazard facilities from the public. It must 

identify the location of the explosives 

and how the public is safeguarded. The 

explosive siting requirements of part 

420 mandate how far apart a launch site 

operator should site its explosive hazard 

facilities based on the quantities of 

energetic materials housed in each 

facility. Distances vary based on the 

quantities at issue, whether the 

energetic materials at a given facility are 

being handled or stored, and whether or 

not the distance being calculated is a 

distance to a public area or public traffic 

route. 

Since the original rulemaking, the 

FAA’s experience with the requirements 

has led it to the current changes. At the 

time it promulgated the original 

requirements, the FAA anticipated that 

any new launch sites would have 

similar siting issues as launch sites 

devoted to expendable launch vehicles, 

and, therefore, relied on the siting 

requirements of the DDESB DOD 

Ammunition and Explosive Safety 

Standard, 6055.9–STD (1997) (1997 

DOD Standard).2 Instead, for the most 

part, the FAA has issued a number of 

licenses for the operation of launch sites 

at existing airports, such as Mojave Air 

and Space Port in California. At these 

airports, the presence of jet fuels 

regulated under existing FAA space 

transportation requirements created 

conditions requiring the FAA to 

reconcile and clarify its separation 

requirements for launch vehicle liquid 

propellant requirements with the 

presence of other industrial chemicals, 

such as aircraft fuels. Based on 

experience with these launch sites and 

on research on other regimes that 

address explosive materials, the FAA 

amends its own requirements as 

described above. 

III. Discussion of Public Comments and 

Final Rule 

The comment period for the NPRM 

closed on May 17, 2011. The FAA 

received comments from XCOR 

Aerospace (XCOR). XCOR’s comments 

support the FAA’s acceptance of a 

separation distance different from the 

one required by §§ 420.63 through 

420.69 if an operator demonstrates an 

equivalent level of safety. XCOR also 

supports the FAA’s proposal to abandon 

storage requirements for the types of 

liquid fuels and oxidizers that are 

already regulated by OSHA. The FAA 

also received a number of opposing 

comments from XCOR. They are 

discussed below and address the FAA’s 

jurisdiction over explosive hazards, the 

nature of explosive hazards and whether 

energetic liquids are all explosives, the 

interplay between the definition of 

liquid propellants and aviation fuels, 

the appropriate license for dealing with 

explosive hazards and, lastly, 

stoichiometric ratios, the theoretical 

ratio of fuel and oxidizer at which the 

fuel is burned completely. 

As an initial matter, the FAA must 

address XCOR’s objection to the FAA’s 

jurisdiction over treating a location 

where static engine firing takes place as 

an explosive hazard facility. XCOR at 

12.3 Congress charged the FAA with 

licensing and regulating the operation of 

launch sites as well as launches. 51 

U.S.C. 50904. Explosive hazards are 

present at launch sites and may threaten 

members of the public who are also 

present at the site, as well as persons 

outside of the launch site. Because static 

firing of an engine involves the handling 

of energetic liquids or explosives and all 

the hazards associated with their 

mixing, the FAA finds it necessary to 

require separation distances between 

the location and the public. At 

commercial launch sites, locations 

where static firing occurs are considered 

explosive hazard facilities under 

§ 420.5. 

As it proposed in the NPRM, the FAA 

is adopting and defining the term 

‘‘energetic liquids’’ to mean a liquid, 

slurry, or gel, consisting of, or 

containing an explosive, oxidizer, fuel, 

or combination of the above, that may 

undergo, contribute to, or cause rapid 

exothermic decomposition. XCOR 

opposes the FAA’s proposed definition 

of ‘‘energetic liquids’’ on the grounds 

that there is no need for the FAA to 

regulate fuels and oxidizers, as 

explosives, because, according to XCOR, 

energetic liquids are not explosives. 

XCOR at 6. 

In 2000, the FAA found it necessary 

to regulate both explosives and liquid 

propellants, but did not define the 

latter. The FAA’s use of both terms 

apparently created the erroneous 

impression that the FAA only regulated 

materials that do not require mixing to 

explode, notwithstanding the FAA’s 

inclusion of liquid propellants in its 

part 420 requirements. As should be 

evident from the FAA’s requirements for 

materials other than division 1.1 

explosives, the FAA has not so limited 

itself. ‘‘Explosive’’ is a broad term, and 

the FAA is using it throughout part 420 

as such. Because of past confusion, the 

FAA is now defining ‘‘energetic liquids’’ 

to encompass liquid fuels, oxidizers, 

and liquid propellants. 

XCOR believes that if a fuel and 

oxidizer are not mixed, the FAA’s 

separation requirements for energetic 

liquids are not necessary. The FAA’s 

requirements, however, are designed to 

mitigate harm caused by inadvertent 

mixing. Energetic liquids such as fuels 

and oxidizers may, when mixed, 

produce the reactions of and share 

characteristics with materials that are 

explosives in the truest technical sense. 

Explosions are due to the sudden 

release of energy over a short period of 

time and may or may not involve 

chemical reactions.4 Three basic 


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55110 Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 

5Section 417.411(a)(1) requires a launch operator 

to establish a safety clear zone able to confine an 

adverse explosive event, based on a worst-case 

event, regardless of the fault tolerance of the 

system. 

6On a related note, XCOR raises the possibility 

of having to evacuate the public as a result of the 

FAA’s regulations. XCOR at 7. As is the case under 

the current requirements, the better solution than 

evacuation would be to relocate a hazardous 

operation. If a site operator addresses the necessary 

separation distances, neither relocation nor 

evacuation should be necessary. 

characteristics of an explosion are: a 

sudden energy release, a rapidly moving 

blast or shock wave, and a blast of a 

magnitude large enough to be 

potentially hazardous. Additionally, 

explosions may be purely a physical 

event involving a sudden release of 

mechanical energy, or a chemical 

explosion requiring a chemical reaction. 

Furthermore, an accident may happen 

without mixing. For example, liquid 

oxygen is an oxidizer and is usually 

stored in its liquid state at a very low 

temperature. Because liquid oxygen has 

a very large liquid-to-gas-expansion 

ratio, 1 to 860 at 68° F, it can undergo 

an explosion known as a boiling liquid 

expanding vapor explosion, commonly 

referred to as a BLEVE. The FAA 

recognizes that no one intends 

inadvertent mixing, but because it can 

happen and because not all accidents 

are the result of mixing, separation 

distances are necessary for energetic 

liquids. 

As proposed, the FAA now defines 

‘‘liquid propellant’’ to mean a 

monopropellant or incompatible 

energetic liquids co-located for purposes 

of serving as propellants on a launch 

vehicle or a related device. In response 

to XCOR’s comment that unmixed fuels 

and oxidizers do not explode, the FAA 

is clarifying that the co-location of 

incompatible energetic liquids makes 

something a liquid propellant only 

where the incompatible energetic 

liquids are housed in tanks connected 

by piping for purposes of mixing. The 

stored energy present when 

incompatible energetic liquids are 

connected by piping poses a hazard 

requiring separation distances because, 

under feasible conditions, the system 

may fail and cause fire, blast, and flying 

fragment hazards. It is because of these 

hazards that organizations such as the 

NFPA require a minimum separation 

distance of 20 feet between a liquid fuel 

and an oxidizer. Obviously, for launch, 

this is not possible, but the NFPA 

requirement underscores the importance 

of separating a fueled launch vehicle 

from the public. For most liquid fueled 

launch vehicles, incompatible energetic 

liquids such as fuels and oxidizers are 

housed in separate tanks on the vehicle. 

Pipes lead from each tank to a 

combustion chamber where combustion 

takes place to generate thrust. The 

presence of the piping is designed to 

ensure mixing in the combustion 

chamber in order to achieve propulsion. 

Accordingly, the FAA is revising its 

definition of liquid propellants from 

what it proposed to the following: A 

monopropellant or an incompatible 

energetic liquid co-located for purposes 

of serving as propellants on a launch 

vehicle or a related device where the 

incompatible energetic liquids are 

housed in tanks connected by piping for 

purposes of mixing. This new reference 

to ‘‘connecting piping’’ should alleviate 

concerns that the FAA intends the 

definition of liquid propellants to apply 

to aircraft or tanker trucks. See XCOR at 

6, 7. 

XCOR claims that because a launch 

license will govern incompatible 

energetic liquids co-located on a launch 

vehicle, these issues should not be 

addressed through a site license. XCOR 

at 3, 8. The FAA does not dispute that 

the launch license will govern launch. 

That being said, the launch operator 

will also have to operate with separation 

distances in effect. This means the site 

operator’s advance planning attendant 

to explosive siting will not go to waste. 

For example, § 417.411, which applies 

to launch operators, requires safety clear 

zones that would keep the hazards 

associated with a launch operator’s 

vehicle from the public during launch 

processing.5 Accordingly, a site operator 

must be able to provide appropriately 

sited facilities that permit a launch 

operator to comply with its 

requirements.6 Similarly, XCOR 

maintains that, in the context of the 

definition of liquid propellants, 

energetic liquids are better addressed in 

the launch license where an appropriate 

hazard assessment will be conducted. 

The FAA agrees, but there still needs to 

be enough room to encompass the 

results of that assessment. For example, 

if a launch operator performs its hazard 

assessment and it, or the FAA, 

determines that it needs a great deal of 

room to encompass its hazards, the 

launch site operator’s preliminary 

explosive siting should already have 

made sure that the necessary separation 

distances are in place at the launch site. 

Different launch vehicles may have 

different levels of quality, safety, and 

reliability, depending on the maturity of 

the technology and the organization, 

which means that the site operator’s 

separation distances must account for a 

worst-case launch vehicle. 

XCOR suggests the FAA take into 

account launch vehicle design and 

construction when determining 

separation distances at a launch site 

where the launch vehicles may vary in 

reliability. XCOR at 3, 8. XCOR brings 

to light an issue that requires 

clarification. Part 420 addresses a 

different issue than a launch operator’s 

safety clear zone. Under parts 417 and 

437, a launch operator must establish a 

safety clear zone during pre- and postflight operations. Part 420 requires there 

be room for such safety clear zones in 

the first place. Otherwise, when 

constructing or establishing a launch 

site, a site operator may fail to plan for 

the safety needs and regulatory 

requirements of its customers. The 

philosophy underlying the necessity for 

separation distance requirements is that 

there must be room for hazardous 

operations, even those covered by other 

licenses. Accordingly, the separation 

distances for the site operator must 

account for vehicles of varying quality 

and reliability. 

The FAA is amending its definition of 

‘‘explosive hazard facility’’ to clarify 

that it includes locations and facilities 

at a launch site where solid propellants, 

liquid propellants or other explosives 

are stored or handled. XCOR objected to 

the proposed definition of an ‘‘explosive 

hazard facility’’ because it includes 

facilities containing energetic liquids, 

including liquid oxygen. XCOR at 4. 

XCOR maintains this conflicts with the 

FAA proposal that it would no longer 

require separation distances around 

liquid oxygen. Although the FAA will 

no longer require separation distances 

for many energetic liquids, a site 

operator must still, in its explosive site 

plan, identify all explosive hazard 

facilities where all energetic liquids will 

be located. The FAA has been regulating 

liquid oxygen as part of an explosive 

hazard facility since 2000, 

characterizing liquid oxygen as a liquid 

propellant, and will continue to do so 

under the new rule, while 

characterizing it as an energetic liquid. 

However, because the FAA has been 

attempting to reduce duplicative 

requirements, the FAA will rely on 

OSHA’s regulations. Therefore, while 

the FAA will no longer require 

separation distances around liquid 

oxygen, OSHA will continue to do so, 

and for the FAA to fail to recognize that 

liquid oxygen is an energetic liquid 

would only create confusion. As 

discussed in the NPRM, OSHA’s 

requirements are extensive and serve to 

protect the safety of the public as an 

ancillary benefit to OSHA’s protection 

of worker safety. 

Lastly, XCOR comments that the net 

explosive weight (NEW) of liquid 

propellant should not be based on the 


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Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 55111 

7Although the NPRM characterized this as 

affecting operations rather than the siting of 

buildings, the FAA must note that it could apply 

to a site operator’s initial planning because a site 

operator would be well advised to consider this 

formula when siting any bleachers for members of 

the public to view a launch. 

8When the FAA reviewed these numbers using a 

more refined analysis, it found that the separation 

distance increments could be expressed with 

greater precision. 

total quantity of liquid fuel and oxidizer 

available on a launch vehicle, but only 

on the portion where the liquid fuel and 

oxidizer are at a stoichiometric ratio. 

XCOR at 10. For example, XCOR 

postulated a horizontal vehicle dumping 

unused oxidizer so that it returns to the 

runway with only 100 pounds of liquid 

oxygen and 1000 pounds of kerosene 

aboard. XCOR maintains that part 420 

would require it to treat the amount of 

kerosene in excess of that which would 

react explosively as, in fact, exploding. 

Therefore, any excess should be 

ignored. XCOR’s comments relate to 

existing requirements that the FAA did 

not propose to change. Therefore, its 

comments are outside the scope of this 

rulemaking. Additionally, part 420 

addresses a site operator’s location of its 

facilities, and XCOR raises an 

operational issue addressed not through 

a launch site operator license, but 

through a launch license. The FAA 

would assess NEW for scenarios 

hypothesized by XCOR under a launch 

license or permit. 

Differences Between the NPRM and the 

Final Rule 

This final rule is adopted for the 

reasons discussed in the NPRM, but 

with minor changes from what the FAA 

proposed. The FAA is defining 

‘‘explosive hazard facility’’ to mean a 

facility or location at a launch site 

where solid propellants, energetic 

liquids, or other explosives are stored or 

handled. In the NPRM, the FAA 

proposed to define this facility as one 

where, in relevant part, solid explosives 

were stored or handled. However, this 

would have created redundancies with 

the references to ‘‘solid explosives’’ and 

‘‘other explosives’’ being references to 

the same thing; the FAA is accordingly 

keeping the original reference to solid 

propellants. 

The FAA requires a launch site 

operator to submit a scaled map that 

shows the location of all explosive 

hazard facilities at the launch site, the 

actual and minimal allowable distances 

between each explosive hazard facility 

and all other explosive hazard facilities, 

each public traffic route, and each 

public area, including the launch site 

boundary. The NPRM incorrectly 

identified the public traffic route as a 

public area. This is relevant for division 

1.1 explosives because the separation 

distances between an explosive hazard 

facility and a public traffic route are less 

than those between an explosive hazard 

facility and a public area. Likewise, 

§ 420.63(d), which permits a site 

operator to demonstrate an equivalent 

level of safety now clarifies that this 

form of relief applies to separation 

distances to public traffic routes as well 

as to public areas. See also § 420.67(a) 

(separating incompatible energetic 

liquids from public traffic routes); 

§ 420.69 (separating division 1.1 and 1.3 

explosives co-located with liquid 

propellants from public traffic routes). 

The FAA is clarifying its requirement 

that a launch site operator must separate 

each explosive hazard facility where the 

NEW is greater than 450 pounds and 

less than 501,500 pounds from each 

public area containing any member of 

the public in the open by a distance 

equal to ¥1133.9 + [389 *ln(NEW)].7

Accordingly, the final rule contains this 

requirement not only in section 

420.65(c)(3), where it appeared in the 

NPRM, but also in sections 420.67(d)(3) 

and 420.69(b)(4), (c) and (d)(5), where it 

was inadvertently omitted. The FAA 

discussed the reasons for this provision 

in its original discussion. NPRM at 

8928. 

The final rule, § 420.65(c)(3), which 

governs the handling of division 1.1 and 

1.3 explosives, now requires each public 

area containing any member of the 

public in the open to be separated from 

an explosive hazard facility by a 

distance equal to ¥1133.9 + [389 

*ln(NEW)] where the NEW is greater 

than 450 pounds and less than 501,500 

pounds. The NPRM incorrectly 8

identified the range of NEW as less than 

600,000 pounds, rather than 501,500 

pounds. Above 501,500 pounds the 

NEW formulas for blast and fragments 

show that blast hazards, rather than 

fragment hazards, determine the 

separation distance. This means that an 

operator must use a blast formula rather 

than a fragment formula for quantities 

above 501,500 pounds. Table E–2 

contains the formulas. 

In the NPRM, the FAA stated, in 

proposed footnote 3 of Table E–3 that a 

net explosive weight of greater than 

500,000 pounds was not allowed for 

division 1.1 explosives because it was 

implied in the 2004 DOD Standard. 

Further investigation has disclosed, 

however, that the FAA misread the 

DDESB limitation. The FAA now 

understands that the limitation meant 

only that the table’s intraline distances 

could not be used for division 1.1 

explosives. 

In the interest of greater clarity, the 

FAA is modifying § 420.65(d)(2), from 

what it proposed in the NPRM to clarify 

that when a site operator has quantities 

of explosives that fall between table 

entries, the site operator may use a 

formula provided by the tables to find 

a separation distance different than the 

one listed for the specified quantity. For 

example, if a site operator has 17 

pounds of division 1.1 explosives, table 

E–1 would require a separation distance 

for a public area of either 506 or 529 

feet. However, the site operator may 

calculate a distance using footnote 1 

that falls between these two distances. 

The FAA’s change clarifies that the site 

operator must use the equation from the 

same table as the distance the site 

operator seeks to determine. In other 

words, the site operator may not use an 

equation from table 2 to calculate a 

distance for table 1. Similarly, for 

paragraph (e)(3), a site operator with 

existing structures who wants to 

calculate the maximum quantity of 

explosives permitted in those structures 

may not use an equation from another 

table to calculate for a quantity being 

calculated. 

Section 420.69 now clarifies that a 

launch site operator may, when 

determining separation distances for colocation of division 1.1 and 1.3 

explosives with liquid propellants, 

employ a maximum credible event 

(MCE) assessment under paragraph (e) 

rather than using the separation 

distances prescribed by paragraphs (b), 

(c) and (d). The NPRM incorrectly 

described the MCE assessment as a 

requirement rather than an option. An 

MCE assessment is one way of 

demonstrating an equivalent level of 

safety. 

Finally, in table E–7 of Appendix E of 

part 420, the FAA inadvertently 

transcribed a footnote from the DDESB 

requirements that the FAA had not 

intended to propose. Specifically, 

footnote 3 of table E–7 in the NPRM, 

would have required sprinklers for Class 

4 oxidizers inside a building. This final 

rule does not incorporate that 

requirement. 

Regulatory Notices and Analyses 

Changes to Federal regulations must 

undergo several analyses. First, 

Executive Order 12866 and Executive 

Order 13563 direct that each Federal 

agency shall propose or adopt a 

regulation only upon a reasoned 

determination that the benefits of the 

intended regulation justify its costs. 

Second, the Regulatory Flexibility Act 

of 1980 (Pub. L. 96–354) requires 

agencies to analyze the economic 

impact of regulatory changes on small 


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55112 Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 

entities. Third, the Trade Agreements 

Act (Pub. L. 96–39) prohibits agencies 

from setting standards that create 

unnecessary obstacles to the foreign 

commerce of the United States. In 

developing U.S. standards, the Trade 

Act requires agencies to consider 

international standards and, where 

appropriate, that they be the basis of 

U.S. standards. Fourth, the Unfunded 

Mandates Reform Act of 1995 (Pub. L. 

104–4) requires 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 

$100 million or more annually (adjusted 

for inflation with base year of 1995). 

This portion of the preamble 

summarizes the FAA’s analysis of the 

economic impacts of this final rule. 

Department of Transportation Order 

DOT 2100.5 prescribes policies and 

procedures for simplification, analysis, 

and review of regulations. If the 

expected cost impact is so minimal that 

a proposed or final rule does not 

warrant a full evaluation, this order 

permits that a statement to that effect 

and the basis for it be included in the 

preamble if a full regulatory evaluation 

of the cost and benefits is not prepared. 

Such a determination has been made for 

this final rule. The reasoning for this 

determination follows: 

In this final rule, the FAA is 

amending its explosive siting separation 

requirements. First, the FAA will 

dispense with separation distances for 

liquid oxygen, nitrogen tetroxide, and 

hydrogen peroxide in concentrations 

equal to or below 91 percent, if not 

stored within an intraline distance of 

another incompatible energetic liquid, 

and if not co-located on a launch 

vehicle. These are unnecessary because 

they duplicate the requirements of other 

regulatory regimes. Second, the FAA is 

decreasing required separation distances 

for division 1.1 explosives and liquid 

propellants with TNT equivalents that 

are less than or equal to 450 pounds, 

while maintaining a level of safety 

equivalent to current requirements. 

Third, the FAA is reducing separation 

distances for the storage and handling of 

division 1.3 explosives, while 

maintaining an equivalent level of safety 

to current requirements. Fourth, the 

FAA is dispensing with the separation 

distance requirements for storing liquid 

oxidizers and Class I, II and III 

flammable and combustible liquids 

because they duplicate the requirements 

of other regulatory regimes. The 

outcome of these changes is expected to 

be cost relieving. These amendments 

will allow the launch operator increased 

flexibility in site planning for the 

storage and handling of explosives. By 

encouraging existing launch sites to 

more effectively use their infrastructure, 

which could result in the additional colocation of launch sites with existing 

airports, the rule provides benefits (such 

as encouraging the development of more 

launch sites) and is cost relieving. By 

removing duplications, the amendments 

make the regulations less burdensome. 

There may be additional cost savings if 

the FAA issues fewer waivers as a result 

of this rule. 

Under current part 420, the FAA does 

not distinguish between public areas 

that are buildings, where people are 

sheltered, and those where people are 

out in the open. This final rule will 

result in greater distances for some 

public areas than are required under 

current rules, but should not result in 

increased distances for siting buildings. 

The operational constraints themselves 

should not increase costs because a 

launch site operator currently must 

ensure under § 420.55 that its customers 

schedule their hazardous operations so 

as not to harm members of the public. 

A site operator may incur minimal costs 

in performing these new calculations 

and updating its procedures to reflect 

any changes in distances. 

Other provisions will add clarity to 

the regulations and result in reduced 

ambiguity and confusion. Included are: 

dispensing with the hazard groups of 

tables E–3 through E–6 of appendix E of 

part 420 as a means of classification; 

changing the definition of explosive 

hazard facility, and adding definitions 

for energetic liquid, liquid propellant 

and maximum credible event. These 

provisions are cost neutral. The 

requirement that the explosive site map 

be at a scale sufficient to determine 

compliance with part 420 can be cost 

relieving because it can avoid time 

spent reviewing maps that are difficult 

to read or requesting that an applicant 

create and submit another map. 

The FAA has, therefore, determined 

this final rule provides cost saving 

opportunities, is not a ‘‘significant 

regulatory action’’ as defined in section 

3(f) of Executive Order 12866, and is not 

‘‘significant’’ as defined in DOT’s 

Regulatory Policies and Procedures. 

Regulatory Flexibility Determination 

The Regulatory Flexibility Act of 1980 

(Pub. L. 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-forprofit 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. 

However, if an agency determines that 

a rule is not expected to have a 

significant economic impact on a 

substantial number of small entities, 

section 605(b) of the RFA provides that 

the head of the agency may so certify 

and a regulatory flexibility analysis is 

not required. The certification must 

include a statement providing the 

factual basis for this determination, and 

the reasoning should be clear. 

The final rule will not increase and 

will likely reduce costs to industry 

because it provides options to launch 

sites with regards to explosive siting. It 

does not require launch site operators to 

increase the distances between where 

they have sited explosives and 

buildings. We did not receive comments 

regarding the initial regulatory 

flexibility analysis. 

Therefore, as the acting FAA 

Administrator, I certify that this rule 

will not have a significant economic 

impact on a substantial number of small 

entities. 

International Trade Impact Assessment 

The Trade Agreements Act of 1979 

(Pub. L. 96–39), as amended by the 

Uruguay Round Agreements Act (Pub. 

L. 103–465), prohibits Federal agencies 

from establishing standards or engaging 

in related activities that create 

unnecessary obstacles to the foreign 

commerce of the United States. 

Pursuant to these Acts, the 

establishment of standards is not 

considered an unnecessary obstacle to 

the foreign commerce of the United 

States, so long as the standard has a 

legitimate domestic objective, such the 

protection of safety, and does not 

operate in a manner that excludes 

imports that meet this objective. The 

statute also requires consideration of 

international standards and, where 

appropriate, that they be the basis for 

U.S. standards. The FAA has assessed 

the potential effect of this final rule and 


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determined that it will have only a 

domestic impact. 

Unfunded Mandates Assessment 

Title II of the Unfunded Mandates 

Reform Act of 1995 (Pub. L. 104–4) 

requires each Federal agency to prepare 

a written statement assessing the effects 

of any Federal mandate in a proposed or 

final agency rule that may result in an 

expenditure of $100 million or more (in 

1995 dollars) in any one year by State, 

local, and tribal governments, in the 

aggregate, or by the private sector; such 

a mandate is deemed to be a ‘‘significant 

regulatory action.’’ The FAA currently 

uses an inflation-adjusted value of 

$143.1 million in lieu of $100 million. 

This final rule does not contain such a 

mandate; therefore, the requirements of 

Title II of the Act do not apply. 

Paperwork Reduction Act 

The Paperwork Reduction Act of 1995 

(44 U.S.C. 3507(d)) requires that the 

FAA consider the impact of paperwork 

and other information collection 

burdens imposed on the public. The 

map requirement is not an increased 

burden in collecting information 

because the FAA already required a 

map. The FAA has determined that 

there is no new requirement for 

information collection associated with 

this final rule. 

International Compatibility 

In keeping with U.S. obligations 

under the Convention on International 

Civil Aviation, it is FAA policy to 

conform to International Civil Aviation 

Organization (ICAO) Standards and 

Recommended Practices to the 

maximum extent practicable. The FAA 

has determined that there are no ICAO 

Standards and Recommended Practices 

that correspond to these regulations. 

Environmental Analysis 

FAA Order 1050.1E identifies FAA 

actions that are categorically excluded 

from preparation of an environmental 

assessment or environmental impact 

statement under the National 

Environmental Policy Act in the 

absence of extraordinary circumstances. 

The FAA has determined this 

rulemaking action qualifies for the 

categorical exclusion identified in 

paragraph 310f and involves no 

extraordinary circumstances. 

Executive Order Determinations 

Executive Order 13132, Federalism 

The FAA has analyzed this final rule 

under the principles and criteria of 

Executive Order 13132, Federalism. The 

agency determined that this action will 

not have a substantial direct effect on 

the States, or the relationship between 

the Federal Government and the States, 

or on the distribution of power and 

responsibilities among the various 

levels of government, and, therefore, 

does not have Federalism implications. 

Executive Order 13211, Regulations 

That Significantly Affect Energy Supply, 

Distribution, or Use 

The FAA analyzed this final rule 

under Executive Order 13211, Actions 

Concerning Regulations that 

Significantly Affect Energy Supply, 

Distribution, or Use (May 18, 2001). The 

agency has determined that it is not a 

‘‘significant energy action’’ under the 

executive order and it is not likely to 

have a significant adverse effect on the 

supply, distribution, or use of energy. 

How To Obtain Additional Information 

Rulemaking Documents 

An electronic copy of a rulemaking 

document my be obtained by using the 

Internet— 

1. Search the Federal eRulemaking 

Portal (http://www.regulations.gov); 

2. Visit the FAA’s Regulations and 

Policies Web page at http:// 

www.faa.gov/regulations_policies/or 

3. Access the Government Printing 

Office’s Web page at http:// 

www.gpo.gov/fdsys/. 

Copies may also be obtained by 

sending a request (identified by notice, 

amendment, or docket number of this 

rulemaking) to the Federal Aviation 

Administration, Office of Rulemaking, 

ARM–1, 800 Independence Avenue 

SW., Washington, DC 20591, or by 

calling (202) 267–9680. 

Comments Submitted to the Docket 

Comments received may be viewed by 

going to http://www.regulations.gov and 

following the online instructions to 

search the docket number for this 

action. Anyone is able to search the 

electronic form of all comments 

received into any of the FAA’s 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.). 

Small Business Regulatory Enforcement 

Fairness Act 

The Small Business Regulatory 

Enforcement Fairness Act (SBREFA) of 

1996 requires FAA to comply with 

small entity requests for information or 

advice about compliance with statutes 

and regulations within its jurisdiction. 

A small entity with questions regarding 

this document, may contact its local 

FAA official, or the person listed under 

the FOR FURTHER INFORMATION CONTACT

heading at the beginning of the 

preamble. To find out more about 

SBREFA on the Internet, visit http:// 

www.faa.gov/regulations_policies/ 

rulemaking/sbre_act/. 

List of Subjects in 14 CFR Part 420 

Launch sites, Reporting and 

recordkeeping requirements, Space 

transportation and exploration. 

The Amendment 

In consideration of the foregoing, the 

Federal Aviation Administration 

amends Chapter III of Title 14, Code of 

Federal Regulations as follows: 

PART 420—LICENSE TO OPERATE A 

LAUNCH SITE 

■ 1. The authority citation for part 420 

continues to read as follows: 

Authority: 51 U.S.C. 50901–50923 

■ 2. Amend § 420.5 by revising the 

definition of Explosive hazard facility 

and by adding the definitions of 

Energetic liquid, Liquid propellant, 

Maximum credible event, and Public 

traffic route, in alphabetical order to 

read as follows: 

§ 420.5 Definitions. 

* * * * * 

Energetic liquid means a liquid, 

slurry, or gel, consisting of, or 

containing an explosive, oxidizer, fuel, 

or combination of the above, that may 

undergo, contribute to, or cause rapid 

exothermic decomposition, deflagration, 

or detonation. 

* * * * * 

Explosive hazard facility means a 

facility or location at a launch site 

where solid propellants, energetic 

liquids, or other explosives are stored or 

handled. 

* * * * * 

Liquid propellant means: 

(1) A monopropellant on a launch 

vehicle or related device; or 

(2) Incompatible energetic liquids colocated for purposes of serving as 

propellants on a launch vehicle or a 

related device where the incompatible 

energetic liquids are housed in tanks 

connected by piping for purposes of 

mixing. 

Maximum credible event means a 

hypothesized worst-case accidental 

explosion, fire, or agent release that is 

likely to occur from a given quantity 

and disposition of explosives, chemical 

agents, or reactive material. 

* * * * * 

Public traffic route means any 

highway or railroad that the general 

public may use. 

* * * * * 

■ 3. Revise § 420.63 to read as follows: 


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§ 420.63 Explosive siting. 

(a) Except as otherwise provided by 

paragraph (b) of this section, a licensee 

must ensure the configuration of the 

launch site follows its explosive site 

plan, and the licensee’s explosive site 

plan complies with the requirements of 

§§ 420.65 through 420.70. The explosive 

site plan must include: 

(1) A scaled map that shows the 

location of all explosive hazard facilities 

at the launch site and that shows actual 

and minimal allowable distances 

between each explosive hazard facility 

and all other explosive hazard facilities, 

each public traffic route, and each 

public area, including the launch site 

boundary; 

(2) A list of the maximum quantity of 

energetic liquids, solid propellants and 

other explosives to be located at each 

explosive hazard facility, including 

explosive class and division; 

(3) A description of each activity to be 

conducted at each explosive hazard 

facility; and 

(4) An explosive site map using a 

scale sufficient to show whether 

distances and structural relationships 

satisfy the requirements of this part. 

(b) A licensee operating a launch site 

located on a federal launch range does 

not have to comply with the 

requirements in §§ 420.65 through 

420.70 if the licensee complies with the 

federal launch range’s explosive safety 

requirements. 

(c) For explosive siting issues not 

addressed by the requirements of 

§§ 420.65 through 420.70, a launch site 

operator must clearly and convincingly 

demonstrate a level of safety equivalent 

to that otherwise required by this part. 

(d) A launch site operator may 

separate an explosive hazard facility 

from another explosive hazard facility, 

public area, or public traffic route by a 

distance different from one required by 

this part only if the launch site operator 

clearly and convincingly demonstrates a 

level of safety equivalent to that 

required by this part. 

■ 4. Revise § 420.65 to read as follows: 

§ 420.65 Separation distance requirements 

for handling division 1.1 and 1.3 explosives. 

(a) Quantity. For each explosive 

hazard facility, a launch site operator 

must determine the total quantity of 

division 1.1 and 1.3 explosives as 

follows: 

(1) A launch site operator must 

determine the maximum total quantity 

of division 1.1 and 1.3 explosives by 

class and division, in accordance with 

49 CFR part 173, Subpart C, to be 

located in each explosive hazard facility 

where division 1.1 and 1.3 explosives 

will be handled. 

(2) When division 1.1 and 1.3 

explosives are located in the same 

explosive hazard facility, the total 

quantity of explosive must be treated as 

division 1.1 for determining separation 

distances; or, a launch site operator may 

add the net explosive weight of the 

division 1.3 items to the net explosive 

weight of division 1.1 items to 

determine the total quantity of 

explosives. 

(b) Separation of division 1.1 and 1.3 

explosives and determination of 

distances. A launch site operator must 

separate each explosive hazard facility 

where division 1.1 and 1.3 explosives 

are handled from all other explosive 

hazard facilities, all public traffic routes, 

and each public area, including the 

launch site boundary, by a distance no 

less than that provided for each quantity 

and explosive division in appendix E of 

this part as follows: 

(1) For division 1.1 explosives, the 

launch site operator must use tables E– 

1, E–2, and E–3 of appendix E of this 

part to determine the distance to each 

public area and public traffic route, and 

to determine each intraline distance. 

(2) For division 1.3 explosives, the 

launch site operator must use table E– 

4 of appendix E of this part to determine 

the distance to each public area and 

public traffic route, and to determine 

each intraline distance. 

(c) Separation distance by weight and 

table. A launch site operator must: 

(1) Employ no less than the public 

area distance, calculated under 

paragraph (b) of this section, to separate 

an explosive hazard facility from each 

public area, including the launch site 

boundary. 

(2) Employ no less than an intraline 

distance to separate an explosive hazard 

facility from all other explosive hazard 

facilities used by a single customer. For 

explosive hazard facilities used by 

different customers a launch site 

operator must use the greater public 

area distance to separate the facilities 

from each other. 

(3) Separate each public area 

containing any member of the public in 

the open by a distance equal to ¥1133.9 

+ [389 *ln(NEW)], where the NEW is 

greater than 450 pounds and less than 

501,500 pounds. 

(d) NEW Quantities that Fall between 

Table Entries. A launch site operator 

must, when determining a separation 

distance for NEW quantities that fall 

between table entries, use the equation 

provided by tables E–1, E–3, or E–4 of 

appendix E of this part. 

(e) Calculating Maximum Permissible 

NEW Given a Distance. A launch site 

operator must, when determining a 

permissible quantity of explosives, 

calculate maximum permissible NEW 

using the equation of tables E–1, E–3, or 

E–4 of appendix E of this part. 

■ 5. Add § 420.66 to read as follows: 

§ 420.66 Separation distance requirements 

for storage of hydrogen peroxide, 

hydrazine, and liquid hydrogen and any 

incompatible energetic liquids stored within 

an intraline distance. 

(a) Separation of energetic liquids and 

determination of distances. A launch 

site operator must separate each 

explosive hazard facility from each 

other explosive hazard facility, each 

public area, and each public traffic route 

in accordance with the minimum 

separation distance determined under 

this section for each explosive hazard 

facility storing: 

(1) Hydrogen peroxide in 

concentrations of greater than 91 

percent; 

(2) Hydrazine; 

(3) Liquid hydrogen; or 

(4) Any energetic liquid that is: 

(i) Incompatible with any of the 

energetic liquids of paragraph (a)(1) 

through (3) of this section; and 

(ii) Stored within an intraline distance 

of any of them. 

(b) Quantity. For each explosive 

hazard facility, a launch site operator 

must determine the total quantity of all 

energetic liquids in paragraph (a)(1) 

through (4) of this section as follows: 

(1) The quantity of energetic liquid in 

a tank, drum, cylinder, or other 

container is the net weight in pounds of 

the energetic liquid in the container. 

The determination of quantity must 

include any energetic liquid in 

associated piping to any point where 

positive means exist for: 

(i) Interrupting the flow through the 

pipe, or 

(ii) Interrupting a reaction in the pipe 

in the event of a mishap. 

(2) A launch site operator must 

convert the quantity of each energetic 

liquid from gallons to pounds using the 

conversion factors provided in table E– 

6 of appendix E of this part and the 

following equation: 

Pounds of energetic liquid = gallons × 

density of energetic liquid (pounds per 

gallon). 

(3) Where two or more containers of 

compatible energetic liquids are stored 

in the same explosive hazard facility, 

the total quantity of energetic liquids is 

the total quantity of energetic liquids in 

all containers, unless: 

(i) The containers are each separated 

from each other by the distance required 

by paragraph (c) of this section; or 

(ii) The containers are subdivided by 

intervening barriers that prevent mixing, 

such as diking. 


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(4) Where two or more containers of 

incompatible energetic liquids are 

stored within an intraline distance of 

each other, paragraph (d) of this section 

applies. 

(c) Determination of separation 

distances for compatible energetic 

liquids. A launch site operator must 

determine separation distances for 

compatible energetic liquids as follows: 

(1) To determine each intraline, 

public area, and public traffic route 

distance, a launch site operator must 

use the following tables in appendix E 

of this part: 

(i) Table E–7 for hydrogen peroxide in 

concentrations of greater than 91 

percent; and 

(ii) Table E–8 for hydrazine and liquid 

hydrogen. 

(2) For liquid hydrogen and 

hydrazine, a launch site operator must 

use the ‘‘intraline distance to 

compatible energetic liquids’’ for the 

energetic liquid that requires the greater 

distance under table E–8 of appendix E 

of this part as the minimum separation 

distance between compatible energetic 

liquids. 

(d) Determination of separation 

distances for incompatible energetic 

liquids. If incompatible energetic liquids 

are stored within an intraline distance 

of each other, a launch site operator 

must determine the explosive 

equivalent in pounds of the combined 

liquids as provided by paragraph (d)(2) 

of this section unless intervening 

barriers prevent mixing. 

(1) If intervening barriers prevent 

mixing, a launch site operator must 

separate the incompatible energetic 

liquids by no less than the intraline 

distance that tables E–7 and E–8 of 

appendix E of this part apply to 

compatible energetic liquids using the 

quantity or energetic liquid requiring 

the greater separation distance. 

(2) A launch site operator must use 

the formulas provided in table E–5 of 

appendix E of this part, to determine the 

explosive equivalent in pounds of the 

combined incompatible energetic 

liquids. A launch site operator must 

then use the explosive equivalent in 

pounds requiring the greatest separation 

distance to determine the minimum 

separation distance between each 

explosive hazard facility and all other 

explosive hazard facilities and each 

public area and public traffic route as 

required by tables E–1, E–2 and E–3 of 

appendix E of this part. 

■ 6. Revise § 420.67 to read as follows: 

§ 420.67 Separation distance requirements 

for handling incompatible energetic liquids 

that are co-located. 

(a) Separation of energetic liquids and 

determination of distances. Where 

incompatible energetic liquids are colocated in a launch or reentry vehicle 

tank or other vessel, a launch site 

operator must separate each explosive 

hazard facility from each other 

explosive hazard facility, each public 

area, and each public traffic route in 

accordance with the minimum 

separation distance determined under 

this section for each explosive hazard 

facility. 

(b) Quantity. For each explosive 

hazard facility, a launch site operator 

must determine the total quantity of all 

energetic liquids as follows: 

(1) The quantity of energetic liquid in 

a launch or reentry vehicle tank is the 

net weight in pounds of the energetic 

liquid. The determination of quantity 

must include any energetic liquid in 

associated piping to any point where 

positive means exist for: 

(i) Interrupting the flow through the 

pipe; or 

(ii) Interrupting a reaction in the pipe 

in the event of a mishap. 

(2) A launch site operator must 

convert each energetic liquid’s quantity 

from gallons to pounds using the 

conversion factors provided by table E– 

6 of appendix E of this part and the 

following equation: 

Pounds of energetic liquid = gallons × 

density of energetic liquid (pounds 

per gallon). 

(c) Determination of separation 

distances for incompatible energetic 

liquids. A launch site operator must 

determine separation distances for 

incompatible energetic liquids as 

follows: 

(1) A launch site operator must use 

the formulas provided in table E–5 of 

appendix E of this part, to determine the 

explosive equivalent in pounds of the 

combined incompatible energetic 

liquids; and 

(2) A launch site operator must then 

use the explosive equivalent in pounds 

to determine the minimum separation 

distance between each explosive hazard 

facility and all other explosive hazard 

facilities and each public area and 

public traffic route as required by tables 

E–1, E–2 and E–3 of appendix E of this 

part. Where two explosive hazard 

facilities contain different quantities, 

the launch site operator must use the 

quantity of liquid propellant requiring 

the greatest separation distance to 

determine the minimum separation 

distance between the two explosive 

hazard facilities. 

(d) Separation distance by weight and 

table. For each explosive hazard facility, 

a launch site operator must: 

(1) For an explosive equivalent weight 

from one pound through and including 

450 pounds, determine the distance to 

any public area and public traffic route 

following table E–1 of appendix E of 

this part; 

(2) For explosive equivalent weight 

greater than 450 pounds, determine the 

distance to any public area and public 

traffic route following table E–2 of 

appendix E of this part; 

(3) Separate each public area 

containing any member of the public in 

the open by a distance equal to ¥1133.9 

+ [389 *ln(NEW)], where the NEW is 

greater than 450 pounds and less than 

501,500 pounds; 

(4) Separate each explosive hazard 

facility from all other explosive hazard 

facilities of a single customer using the 

intraline distance provided by table E– 

3 of appendix E of this part; and 

(5) For explosive hazard facilities 

used by different customers, use the 

greater public area distance to separate 

the facilities from each other. 

■ 7. Revise § 420.69 to read as follows: 

§ 420.69 Separation distance requirements 

for co-location of division 1.1 and 1.3 

explosives with liquid propellants. 

(a) Separation of energetic liquids and 

explosives and determination of 

distances. A launch site operator must 

separate each explosive hazard facility 

from each other explosive hazard 

facility, each public traffic route, and 

each public area in accordance with the 

minimum separation distance 

determined under this section for each 

explosive hazard facility where division 

1.1 and 1.3 explosives are co-located 

with liquid propellants. A launch site 

operator must determine each minimum 

separation distance from an explosive 

hazard facility where division 1.1 and 

1.3 explosives and liquid propellants 

are to be located together, to each other 

explosive hazard facility, public traffic 

route, and public area as described in 

paragaphs (b) through (e) of this section. 

(b) Liquid propellants and division 1.1 

explosives located together. For liquid 

propellants and division 1.1 explosives 

located together, a launch site operator 

must: 

(1) Determine the explosive 

equivalent weight of the liquid 

propellants by following § 420.67(c); 

(2) Add the explosive equivalent 

weight of the liquid propellants and the 

net explosive weight of division 1.1 

explosives to determine the combined 

net explosive weight; 

(3) Use the combined net explosive 

weight to determine the distance to each 


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55116 Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 

public area, public traffic route, and 

each other explosive hazard facility by 

following tables E–1, E–2, and E–3 of 

appendix E of this part; and 

(4) Separate each public area 

containing any member of the public in 

the open by a distance equal to ¥1133.9 

+ [389 *ln(NEW)], where the net 

explosive weight is greater than 450 

pounds and less than 501,500 pounds. 

(c) Liquid propellants and division 1.3 

explosives located together. For liquid 

propellants and division 1.3 explosives 

located together, a launch site operator 

must separate each explosive hazard 

facility from each other explosive 

hazard facility, public area, and public 

traffic route using either of the following 

two methods: 

(1) Method 1. (i) Determine the 

explosive equivalent weight of the 

liquid propellants by following 

§ 420.67(c); 

(ii) Add to the explosive equivalent 

weight of the liquid propellants, the net 

explosive weight of each division 1.3 

explosive, treating division 1.3 

explosives as division 1.1 explosives; 

(iii) Use the combined net explosive 

weight to determine the minimum 

separation distance to each public area, 

public traffic route, and each other 

explosive hazard facility by following 

tables E–1, E–2, and E–3 of appendix E 

of this part; and 

(iv) Separate each public area 

containing any member of the public in 

the open by a distance equal to -1133.9 

+ [389 *ln(NEW)], where the net 

explosive weight is greater than 450 

pounds and less than 501,500 pounds. 

(2) Method 2. (i) Determine the 

explosive equivalent weight of each 

liquid propellant by following 

§ 420.67(c); 

(ii) Add to the explosive equivalent 

weight of the liquid propellants, the net 

explosive weight of each division 1.3 

explosive to determine the combined 

net explosive weight; 

(iii) Use the combined net explosive 

weight to determine the minimum 

separation distance to each public area, 

public traffic route, and each other 

explosive hazard facility by following 

tables E–1, E–2, and E–3 of appendix E 

of this part; and 

(iv) Separate each public area 

containing any member of the public in 

the open by a distance equal to -1133.9 

+ [389 *ln(NEW)], where the net 

explosive weight is greater than 450 

pounds and less than 501,500 pounds. 

(d) Liquid propellants and division 

1.1 and 1.3 explosives located together. 

For liquid propellants and division 1.1 

and 1.3 explosives located together, a 

launch site operator must: 

(1) Determine the explosive 

equivalent weight of the liquid 

propellants by following § 420.67(c); 

(2) Determine the total explosive 

quantity of each division 1.1 and 1.3 

explosive by following § 420.65(a)(2); 

(3) Add the explosive equivalent 

weight of the liquid propellants to the 

total explosive quantity of division 1.1 

and 1.3 explosives together to determine 

the combined net explosive weight; 

(4) Use the combined net explosive 

weight to determine the distance to each 

public area, public traffic route, and 

each other explosive hazard facility by 

following tables E–1, E–2, and E–3 of 

appendix E of this part; and 

(5) Separate each public area 

containing any member of the public in 

the open by a distance equal to -1133.9 

+ [389 *ln(NEW)], where the net 

explosive weight is greater than 450 

pounds and less than 501,500 pounds 

(e) Use of maximum credible event 

analysis. If a launch site operator does 

not want to employ paragraphs (b), (c), 

or (d) of this section, the launch site 

operator must analyze the maximum 

credible event (MCE) or the worst case 

explosion expected to occur. If the MCE 

shows there will be no simultaneous 

explosion reaction of the liquid 

propellant tanks and the solid 

propellant motors, the minimum 

distance between the explosive hazard 

facility and all other explosive hazard 

facilities and public areas must be based 

on the MCE. 

■ 8. Add § 420.70 to read as follows: 

§ 420.70 Separation distance 

measurement requirements. 

(a) This section applies to all 

measurements of distances performed 

under §§ 420.63 through 420.69. 

(b) A launch site operator must 

measure each separation distance along 

straight lines. For large intervening 

topographical features such as hills, the 

launch site operator must measure over 

or around the feature, whichever is the 

shorter. 

(c) A launch site operator must 

measure each minimum separation 

distance from the closest hazard source, 

such as a container, building, segment, 

or positive cut-off point in piping, in an 

explosive hazard facility. When 

measuring, a launch site operator must: 

(1) For a public traffic route distance, 

measure from the nearest side of the 

public traffic route to the closest point 

of the hazard source; and 

(2) For an intraline distance, measure 

from the nearest point of one hazard 

source to the nearest point of the next 

hazard source. The minimum separation 

distance must be the distance for the 

quantity of energetic liquids or net 

explosive weight that requires the 

greater distance. 

■ 9. Revise Appendix E to part 420 to 

read as follows: 

Appendix E to Part 420—Tables for 

Explosive Site Plan 

TABLE E–1—DIVISION 1.1 DISTANCES

TO A PUBLIC AREA OR PUBLIC TRAFFIC ROUTE FOR NEW ≤450 LBS

NEW 

(lbs.) 

Distance to 

public area 

(ft) 1,2

Distance to 

public traffic 

route distance 

(ft) 2

≤0.5 ................... 236 142 

0.7 ..................... 263 158 

1 ........................ 291 175 

2 ........................ 346 208 

3 ........................ 378 227 

5 ........................ 419 251 

7 ........................ 445 267 

10 ...................... 474 284 

15 ...................... 506 304 

20 ...................... 529 317 

30 ...................... 561 337 

31 ...................... 563 338 

50 ...................... 601 361 

70 ...................... 628 377 

100 .................... 658 395 

150 .................... 815 489 

200 .................... 927 556 

300 .................... 1085 651 

450 .................... 1243 746 

1To calculate distance d to a public area 

from NEW: 

NEW ≤ 0.5 lbs: d = 236 

0.5 lbs < NEW <100 lbs: d = 291.3 + [79.2 

*ln(NEW)] 

100 lbs ≤ NEW ≤ 450 lbs: d = -1133.9 + 

[389 *ln(NEW)] 

NEW is in lbs; d is in ft; ln is natural logarithm. 

To calculate maximum NEW given distance 

d (noting that d can never be less than 236 ft): 

0 ≤ d < 236 ft: Not allowed (d cannot be 

less than 236 ft) 

236 ft ≤d < 658 ft: NEW = exp [(d/79.2)- 

3.678] 

658 ft ≤ d < 1250 ft: NEW = exp [(d/389) 

+2.914] 

NEW is in lbs; d is in ft; exp[x] is ex. 2The public traffic route distance is 60 percent of the distance to a public area. 


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Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 55117 

TABLE E–2—DIVISION 1.1 DISTANCE TO PUBLIC AREA AND PUBLIC TRAFFIC ROUTE FOR NEW > 450 LBS

NEW (lbs) Distance to public area 

(ft) 1

Distance to public traffic route 

(ft) 

450 lbs< NEW ≤ 30,000 lbs ............................................. 1,250 .................................. 750. 

30,000 lbs< NEW ≤ 100,000 lbs ...................................... 40*NEW 1⁄3 ......................... 0.60*(Distance to Public Area). 

100,000 lbs< NEW ≤ 250,000 lbs .................................... 2.42*NEW 0.577 ................... 0.60*(Distance to Public Area). 

250,000 lbs< NEW ............................................................ 50*NEW 1⁄3 ......................... 0.60*(Distance to Public Area). 

1To calculate NEW from distance d to a public area: 

1, 243 ft< d ≤ 1,857 ft: NEW = d3/64,000 

1, 857 ft< d ≤ 3,150 ft: NEW = 0.2162 * d 1.7331

3,150 ft< d: NEW = d3/125,000 

NEW is in lbs; d is in ft. 

TABLE E–3—DIVISION 1.1 INTRALINE

DISTANCES1,2,3

NEW 

(lbs) 

Intraline 

Distance 

(ft) 

50 ........................................ 66 

70 ........................................ 74 

100 ...................................... 84 

150 ...................................... 96 

200 ...................................... 105 

300 ...................................... 120 

500 ...................................... 143 

700 ...................................... 160 

1,000 ................................... 180 

1,500 ................................... 206 

2,000 ................................... 227 

3,000 ................................... 260 

5,000 ................................... 308 

7,000 ................................... 344 

10,000 ................................. 388 

TABLE E–3—DIVISION 1.1 INTRALINE

DISTANCES1,2,3—Continued 

NEW 

(lbs) 

Intraline 

Distance 

(ft) 

15,000 ................................. 444 

20,000 ................................. 489 

30,000 ................................. 559 

50,000 ................................. 663 

70,000 ................................. 742 

100,000 ............................... 835 

150,000 ............................... 956 

200,000 ............................... 1,053 

300,000 ............................... 1,205 

500,000 3 ............................ 1,429 

700,000 ............................... 1,598 

1,000,000 ............................ 1,800 

1,500,000 ............................ 2,060 

2,000,000 ............................ 2,268 

3,000,000 ............................ 2,596 

TABLE E–3—DIVISION 1.1 INTRALINE

DISTANCES1,2,3—Continued 

NEW 

(lbs) 

Intraline 

Distance 

(ft) 

5,000,000 ............................ 3,078 

1To calculate intraline distance d from 

NEW: 

d = 18*NEW 1⁄3

NEW is in pounds; d is in feet 

2To calculate maximum NEW from given 

intraline distance d: 

NEW = d3/5,832 

NEW is in pounds; d is in feet. 

3 NEW values of more than 500,000 lbs only 

apply to liquid propellants with TNT equivalents equal to those NEW values. The intraline 

distances for NEW greater than 500,000 

pounds do not apply to division 1.1 explosives. 

TABLE E–4—DIVISION 1.3 SEPARATION DISTANCES

NEW (lbs) 

Distance to 

public area or 

public traffic 

route (ft) 1

Intraline 

distance (ft) 2

≤1000 ....................................................................................................................................................................... 75 50 

1,500 ........................................................................................................................................................................ 82 56 

2,000 ........................................................................................................................................................................ 89 61 

3,000 ........................................................................................................................................................................ 101 68 

5,000 ........................................................................................................................................................................ 117 80 

7,000 ........................................................................................................................................................................ 130 88 

10,000 ...................................................................................................................................................................... 145 98 

15,000 ...................................................................................................................................................................... 164 112 

20,000 ...................................................................................................................................................................... 180 122 

30,000 ...................................................................................................................................................................... 204 138 

50,000 ...................................................................................................................................................................... 240 163 

70,000 ...................................................................................................................................................................... 268 181 

100,000 .................................................................................................................................................................... 300 204 

150,000 .................................................................................................................................................................... 346 234 

200,000 .................................................................................................................................................................... 385 260 

300,000 .................................................................................................................................................................... 454 303 

500,000 .................................................................................................................................................................... 569 372 

700,000 .................................................................................................................................................................... 668 428 

1,000,000 ................................................................................................................................................................. 800 500 

1,500,000 ................................................................................................................................................................. 936 577 

2,000,000 ................................................................................................................................................................. 1,008 630 

1To calculate distance d to a public area or traffic route from NEW: 

NEW ≤1,000lbs 

d= 75 ft 

1,000 lbs< NEW ≤ 96,000 lbs 

d=exp[2.47 + 0.2368*(ln(NEW)) + 0.00384*(ln(NEW))2] 

96,000 lbs< NEW ≤1,000,000 lbs 

d = exp[7.2297¥0.5984*(ln(NEW)) + 0.04046*(ln(NEW))2] 

NEW > 1,000,000 lbs 

d = 8*NEW 1⁄3

NEW is in pounds; d is in feet; exp[x] is ex; ln is natural logarithm. 

To calculate NEW from distance d to a public area or traffic route (noting that d cannot be less than 75 ft): 


srobinson on DSK4SPTVN1PROD with RULES
55118 Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 

0 ≤ d < 75 ft: 

Not allowed (d cannot be less than 75 ft) for NEW ≤ 1000 lbs 

75 ft ≤ d≤ 296 ft 

NEW = exp[¥30.833 + (307.465 + 260.417*(ln(d)))1⁄2] 

296 ft< d≤ 800 ft 

NEW = exp[7.395 + (¥124.002 + 24.716*(ln(d)))1⁄2] 

800 ft< d 

NEW = d3/512 

NEW is in lbs; d is in ft; exp[x] is ex; ln is natural logarithm 2To calculate intraline distance d from NEW: 

NEW ≤ 1,000 lbs 

d = 50 ft 

1,000 lbs< NEW ≤ 84,000 lbs 

d=exp[2.0325 + 0.2488*(ln(NEW)) + 0.00313* (ln(NEW))2] 

84,000 lbs< NEW ≤ 1,000,000 lbs 

d= exp[4.338¥0.1695*(ln(NEW)) + 0.0221*(ln(NEW))2] 

1,000,000 lbs< NEW 

d =5*NEW 1⁄3

NEW is in pounds; d is in feet; exp[x] is ex; ln is natural logarithm 

To calculate NEW from an intraline distance d: 

0 ≤ d < 50 ft: 

Not allowed (d cannot be less than 50 ft) for NEW ≤ 1000 lbs 

50 ft ≤ d≤ 192 ft 

NEW = exp[¥39.744 + (930.257 + 319.49*(ln(d)))1⁄2] 

192 ft<d≤ 500 ft 

NEW = exp[3.834 + (¥181.58 + 45.249*(ln(d)))1⁄2] 

500 ft≤d 

NEW = d3/125 

NEW is in pounds; d is in feet; exp[x] is ex; ln is natural logarithm 

TABLE E–5—ENERGETIC LIQUID EXPLOSIVE EQUIVALENTS1,2,3

Energetic liquids TNT Equivalence TNT Equivalence 

Static Test Stands ............................................ Launch Pads. 

LO2/LH2 .............................................................. See Note 3 ....................................................... See Note 3. 

LO2/LH2 + LO2/RP–1 ......................................... Sum of (see Note 3 for LO2/LH2) + (10% for 

LO2/RP1).

Sum of (see Note 3 for LO2/LH2) + (20% for 

LO2/RP1). 

LO2/RP–1 ........................................................... 10% .................................................................. 20% up to 500,000 lbs 

Plus 10% over 500,000 lbs 

IRFNA/UDMH .................................................... 10% .................................................................. 10%. 

N204/UDMH + N2H4 ........................................... 5% .................................................................... 10%. 

1A launch site operator must use the percentage factors of table E–5 to determine TNT equivalencies of incompatible energetic liquids that are 

within an intraline distance of each other. 2A launch site operator may substitute the following energetic liquids to determine TNT equivalency under this table as follows:

Alcohols or other hydrocarbon for RP–1 

H2O2 for LO2 (only when H2O2 is in combination with RP–1 or equivalent hydrocarbon fuel) 

MMH for N2H4, UDMH, or combinations of the two. 3TNT equivalency for LO2/LH2 is the larger of: 

(a) TNT equivalency of 8*W2⁄3, where W is the weight of LO2/LH2 in lbs; or 

(b) 14 percent of the LO2/LH2 weight. 

TABLE E–6—FACTORS TO USE WHEN CONVERTING ENERGETIC LIQUID DENSITIES

Item Density 

(lb/gal) 

Temperature 

(°F) 

Ethyl alcohol .......................................................................................................................................................... 6 .6 68 

Hydrazine ............................................................................................................................................................... 8 .4 68 

Hydrogen peroxide (90 percent) ............................................................................................................................ 11 .6 68 

Liquid hydrogen ..................................................................................................................................................... 0 .59 ¥423 

Liquid oxygen ......................................................................................................................................................... 9 .5 ¥297 

Red fuming nitric acid (IRFNA) ............................................................................................................................. 12 .9 77 

RP–1 ...................................................................................................................................................................... 6 .8 68 

UDMH .................................................................................................................................................................... 6 .6 68 

UDMH/Hydrazine ................................................................................................................................................... 7 .5 68 


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Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 55119 

TABLE E–7—SEPARATION DISTANCE

CRITERIA FOR STORAGE OF HYDROGEN PEROXIDE IN CONCENTRATIONS

OF MORE THAN 91 PERCENT1,2

Quantity 

(lbs) 

Intraline distance 

or distance to 

public area or distance to public 

traffic route 

(ft) 

10,000 ............................. 510 

15,000 ............................. 592 

20,000 ............................. 651 

30,000 ............................. 746 

50,000 ............................. 884 

70,000 ............................. 989 

100,000 ........................... 1114 

150,000 ........................... 1275 

200,000 ........................... 1404 

300,000 ........................... 1607 

TABLE E–7—SEPARATION DISTANCE

CRITERIA FOR STORAGE OF HYDROGEN PEROXIDE IN CONCENTRATIONS

OF MORE THAN 91 PERCENT1,2— 

Continued 

Quantity 

(lbs) 

Intraline distance 

or distance to 

public area or distance to public 

traffic route 

(ft) 

500,000 ........................... 1905 

1 Multiple tanks containing hydrogen peroxide in concentrations of greater than 91 percent may be located at distances less than 

those required by table E–7; however, if the 

tanks are not separated from each other by 10 

percent of the distance specified for the largest tank, then the launch site operator must 

use the total contents of all tanks to calculate 

each intraline distance and the distance to 

each public area and each public traffic route. 

2A launch site operator may use the equations below to determine permissible distance 

or quantity between the entries of table E–7: 

W > 10,000 lbs Distance = 24 * W1⁄3

Where Distance is in ft and W is in lbs. 

To calculate weight of hydrogen peroxide 

from a distance d: 

d > 75 ft 

W = exp[¥134.286 + 71.998*(ln(d)) 

¥12.363*(ln(d))2 + 0.7229*(ln(d))3] 

TABLE E–8—SEPARATION DISTANCE CRITERIA FOR STORAGE OF LIQUID HYDROGEN AND BULK QUANTITIES OF

HYDRAZINE

Pounds of energetic liquid Pounds of energetic liquid 

Public area 

and intraline 

distance to incompatible energetic liquids 

Intraline distance to compatible energetic liquids 

Pounds of energetic liquid Pounds of energetic liquid 

Public area 

and intraline 

distance to incompatible energetic liquids 

Intraline distance to compatible energetic liquids 

Over Not Over Distance in 

feet 

Distance in 

feet 

Over Not Over Distance in 

feet 

Distance in 

feet 

60,000 70,000 1,200 130 

100 ............................... 200 600 35 70,000 80,000 1,200 130 

200 ............................... 300 600 40 80,000 90,000 1,200 135 

300 ............................... 400 600 45 90,000 100,000 1,200 135 

400 ............................... 500 600 50 100,000 125,000 1,800 140 

500 ............................... 600 600 50 125,000 150,000 1,800 145 

600 ............................... 700 600 55 150,000 175,000 1,800 150 

700 ............................... 800 600 55 175,000 200,000 1,800 155 

800 ............................... 900 600 60 200,000 250,000 1,800 160 

900 ............................... 1,000 600 60 250,000 300,000 1,800 165 

1,000 ............................ 2,000 600 65 300,000 350,000 1,800 170 

2,000 ............................ 3,000 600 70 350,000 400,000 1,800 175 

3,000 ............................ 4,000 600 75 400,000 450,000 1,800 180 

4,000 ............................ 5,000 600 80 450,000 500,000 1,800 180 

5,000 ............................ 6,000 600 80 500,000 600,000 1,800 185 

6,000 ............................ 7,000 600 85 600,000 700,000 1,800 190 

7,000 ............................ 8,000 600 85 700,000 800,000 1,800 195 

8,000 ............................ 9,000 600 90 800,000 900,000 1,800 200 

9,000 ............................ 10,000 600 90 900,000 1,000,000 1,800 205 

10,000 .......................... 15,000 1,200 95 1,000,000 2,000,000 1,800 235 

15,000 .......................... 20,000 1,200 100 2,000,000 3,000,000 1,800 255 

20,000 .......................... 25,000 1,200 105 3,000,000 4,000,000 1,800 265 

25,000 .......................... 30,000 1,200 110 4,000,000 5,000,000 1,800 275 

30,000 .......................... 35,000 1,200 110 5,000,000 6,000,000 1,800 285 

35,000 .......................... 40,000 1,200 115 6,000,000 7,000,000 1,800 295 

40,000 .......................... 45,000 1,200 120 7,000,000 8,000,000 1,800 300 

45,000 .......................... 50,000 1,200 120 8,000,000 9,000,000 1,800 305 

50,000 .......................... 60,000 1,200 125 9,000,000 10,000,000 1,800 310 


srobinson on DSK4SPTVN1PROD with RULES
55120 Federal Register / Vol. 77, No. 174 / Friday, September 7, 2012 / Rules and Regulations 

1 Ginnie Mae is a registered service mark of the 

Government National Mortgage Association; see 

http://www.ginniemae.gov/. 

Issued in Washington, DC, on August 24, 

2012. 

Michael P. Huerta, 

Acting Administrator. 

[FR Doc. 2012–21922 Filed 9–6–12; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

24 CFR Parts 5, 200, 207, and 232 

[Docket No. FR–5465 F–02] 

RIN–2502–AJ05 

Federal Housing Administration (FHA): 

Section 232 Healthcare Facility 

Insurance Program-Strengthening 

Accountability and Regulatory 

Revisions Update 

AGENCY: Office of the Assistant 

Secretary for Housing—Federal Housing 

Commissioner, HUD. 

ACTION: Final rule. 

SUMMARY: In 2010 through 2011, HUD 

commenced and completed the process 

of revising regulations applicable to, 

and closing documents used in, FHA 

insurance of multifamily rental projects, 

to reflect current policy and practices in 

the multifamily mortgage market. This 

final rule results from a similar process 

that was initiated in 2011 for revising 

and updating the regulations governing, 

and the transactional documents used 

in, the program for insurance of 

healthcare facilities under section 232 of 

the National Housing Act (Section 232 

program). HUD’s Section 232 program 

insures mortgage loans to facilitate the 

construction, substantial rehabilitation, 

purchase, and refinancing of nursing 

homes, intermediate care facilities, 

board and care homes, and assistedliving facilities. This rule revises the 

Section 232 program regulations to 

reflect current policy and practices, and 

improve accountability and strengthen 

risk management in the Section 232 

program. 

DATES: Effective October 9, 2012. 

FOR FURTHER INFORMATION CONTACT: 

Kelly Haines, Director, Office of 

Residential Care Facilities, Office of 

Healthcare Programs, Office of Housing, 

Department of Housing and Urban 

Development, 451 7th Street SW., Room 

6264, Washington, DC 20410–8000; 

telephone number 202–708–0599 (this 

is not a toll-free number). Persons with 

hearing or speech impairments may 

access this number through TTY by 

calling the toll-free Federal Relay 

Service at 1–800–877–8339. 

I. Supplementary Information 

A. Background 

Section 232 of the National Housing 

Act (12 U.S.C. 1715w) (Section 232) 

authorizes FHA to insure mortgages 

made by private lenders to finance the 

development of nursing homes, 

intermediate care facilities, board and 

care homes, and assisted living facilities 

(collectively, residential healthcare 

facilities). The Section 232 program 

allows for long-term, fixed-rate 

financing for new and rehabilitated 

properties for up to 40 years. Existing 

properties without rehabilitation can be 

financed with or without Ginnie Mae®1

Mortgage Backed Securities for up to 35 

years. Eligible borrowers under the 

Section 232 program include investors, 

builders, developers, public entities, 

and private nonprofit corporations and 

associations. The documents executed 

at loan closing provide that the 

borrower may not engage in any other 

business or activity. 

The maximum amount of the loan for 

new construction and substantial 

rehabilitation is equal to 90 percent (95 

percent for nonprofit organization 

sponsors) of the estimated value of 

physical improvements and major 

movable equipment. For existing 

projects, the maximum is 85 percent (90 

percent for nonprofit organization 

sponsors) of the estimated value of the 

physical improvements and major 

movable equipment. 

As the need for residential care 

facilities increased, requests to FHA to 

make mortgage insurance available for 

such facilities also increased. As with 

any program growth, updates to 

regulations are needed to ensure that 

program requirements are sufficient to 

meet increased demand, and prevent 

mortgage defaults that not only impose 

a risk to the FHA insurance fund but 

can also jeopardize the safety and 

stability of Section 232 facilities and 

their residents. HUD’s regulations 

governing the Section 232 program are 

primarily codified in 24 CFR part 232. 

B. The Proposed Rule 

On May 3, 2012, HUD published a 

proposed rule at 77 FR 26218, in which 

it submitted, for public comment, 

revisions to the Section 232 program 

regulations. On May 3, 2012, HUD also 

published a notice at 77 FR 26304, 

which proposed revisions to the related 

documents used in the insurance of 

healthcare facilities under the Section 

232 program. In the May 3, 2012, rule, 

HUD proposed regulatory revisions that 

would update terminology, require a 

single asset form of ownership, and 

reflect current policy and practices used 

in healthcare facility transactions today. 

The updates included in the proposed 

rule also included amendments to 

HUD’s Uniform Financial Reporting 

Standards to include operators of 

projects insured or held by HUD as 

entities that must submit financial 

reports. In addition, in the May 3, 2012 

rule, HUD proposed several revisions to 

strengthen borrower eligibility 

requirements, as well as HUD’s 

oversight of the healthcare program and 

projects. 

With respect to proposed revisions to 

the Section 232 documents, published 

in the May 3, 2012, notice, HUD will 

address public comments and advise of 

any changes through separate 

publication. 

C. Key Changes Made at the Final Rule 

Stage 

In response to comments, HUD made 

several changes to the regulatory text 

proposed by the May 3, 2012, rule. Key 

changes made at the final rule stage 

include the following: 

Transition period for compliance. For 

several of the new or updated regulatory 

provisions in this final rule, HUD 

provides a transition period of 6 months 

before compliance with the 

requirements become applicable. The 

final rule, at § 232.1(b), lists which 

regulatory sections become applicable 6 

months after publication of this final 

rule. 

Removal of an across-the-board longterm debt service reserve. The final rule 

removes the across-the-board 

requirement, proposed in the May 3, 

2012, rule, to establish and maintain a 

long-term debt service reserve. The 

requirement was designed to provide a 

borrower facing operating difficulties, at 

any time throughout the life of the 

mortgage, the time to arrange a workout 

plan by providing a source of funds 

from which the borrower could make 

debt service payments and thus delay or 

avoid an insurance claim by the lender. 

Several commenters objected to the 

across-the-board nature of this reserve, 

and offered various alternatives to 

provide such additional time for 

workouts. Commenters recommended 

addressing the timing issues directly 

and expanding the time periods 

involved in a lender’s submission of a 

claim for insurance and HUD’s 

processing of such a claim. This 

recommendation builds from similar 

revisions implemented through the 

updates to the multifamily rental 


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