This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

14307 

Vol. 77, No. 47 

Friday, March 9, 2012 

DEPARTMENT OF AGRICULTURE 

Rural Utilities Service 

7 CFR 1777 

RIN 0572–AC26 

Water and Waste Disposal Loans and 

Grants 

AGENCY: Rural Utilities Service, USDA. 

ACTION: Proposed rule. 

SUMMARY: The Rural Utilities Service 

(RUS) proposes to amend the 

regulations pertaining to the Section 

306C Water and Waste Disposal (WWD) 

Loans and Grants program, which 

provides water and waste disposal 

facilities and services to low-income 

rural communities whose residents face 

significant health risks. Specifically, 

RUS is proposing to modify the priority 

points system within the regulation in 

order to give additional priority points 

to colonias areas that are un-served and 

that are facing significant health risks. 

The intent is to ensure that the neediest 

areas receive funding. RUS is also 

seeking comments on other potential 

modifications that could provide 

incentive for local entities to assist areas 

designated as colonias that lack access 

to water or waste disposal systems and/ 

or which face significant health risk. 

DATES: Comments must be submitted by 

May 8, 2012. 

ADDRESSES: Submit comments by either 

of the following methods: 

• Federal eRulemaking Portal at: 

http://www.regulations.gov. Follow 

instructions for submitting comments. 

• Postal Mail/Commercial Delivery: 

Please send your comment addressed to 

Michele Brooks, Director, Program 

Development and Regulatory Analysis, 

USDA Rural Development, 1400 

Independence Avenue, STOP 1522, 

Room 5159, Washington, DC 20250– 

1522. 

Additional information about the 

Agency and its programs is available on 

the Internet at http:// 

www.rurdev.usda.gov. 

FOR FURTHER INFORMATION CONTACT: 

Jacqueline M. Ponti-Lazaruk, Assistant 

Administrator, Water and 

Environmental Programs, Rural Utilities 

Service, Rural Development, U.S. 

Department of Agriculture, 1400 

Independence Avenue SW., STOP 1548, 

Room 5147–S, Washington, DC 20250– 

1590. Telephone number: (202) 720– 

2670, Facsimile: (202) 720–0718. 

SUPPLEMENTARY INFORMATION: 

Executive Order 12866 

This rule has been determined to be 

not significant for purposes of Executive 

Order 12866 and, therefore, has not 

been reviewed by the Office of 

Management and Budget. 

Executive Order 12988 

This rule has been reviewed under 

Executive Order 12988, Civil Justice 

Reform. The Agency has determined 

that this rule meets the applicable 

standards provided in section 3 of that 

Executive Order. In addition, all State 

and local laws and regulations that are 

in conflict with this rule will be 

preempted. No retroactive effect will be 

given to the rule and, in accordance 

with section 212(e) of the Department of 

Agriculture Reorganization Act of 1994 

(7 U.S.C. 6912(e)), administrative appeal 

procedures must be exhausted before an 

action against the Department or its 

agencies may be initiated. 

Regulatory Flexibility Act Certification 

RUS has determined that this 

proposed rule will not have a significant 

economic impact on a substantial 

number of small entities, as defined in 

the Regulatory Flexibility Act (5 U.S.C. 

601 et seq.). RUS provides loans to 

borrowers at interest rates and on terms 

that are more favorable than those 

generally available from the private 

sector. RUS borrowers, as a result of 

obtaining federal financing, receive 

economic benefits that exceed any 

direct economic costs associated with 

complying with RUS regulations and 

requirements. 

Information Collection and 

Recordkeeping Requirements 

This rule contains no new reporting 

or recordkeeping burdens under OMB 

control number 0572–0109 that would 

require approval under the Paperwork 

Reduction Act of 1995 (44 U.S.C. 

Chapter 35). 

E-Government Act Compliance 

The Agency is committed to the 

E-Government Act, which requires 

Government agencies in general to 

provide the public the option of 

submitting information or transacting 

business electronically to the maximum 

extent possible. 

Catalog of Federal Domestic Assistance 

The programs described by this rule 

are listed in the Catalog of Federal 

Domestic Assistance Programs under 

number 10.770 Water and Waste 

Disposal Loans and Grants (Section 

306C). The Catalog is available on the 

Internet at http://www.cfda.gov. 

Executive Order 12372 

This program is subject to the 

provisions of Executive Order 12372, 

Intergovernmental Consultation, which 

requires intergovernmental consultation 

with State and local officials. 

Unfunded Mandates 

This rule contains no Federal 

mandates (under the regulatory 

provision of Title II of the Unfunded 

Mandate Reform Act of 1995) for State, 

local, and tribal governments or the 

private sector. Thus, this rule is not 

subject to the requirements of sections 

202 and 205 of the Unfunded Mandate 

Reform Act of 1995. 

National Environmental Policy Act 

Certification 

The Agency has determined that this 

rule will not significantly affect the 

quality of the human environment as 

defined by the National Environmental 

Policy Act of 1969 (42 U.S.C. 4321 et 

seq.). Therefore, this action does not 

require an environmental impact 

statement or assessment. 

Executive Order 13132, Federalism 

The policies contained in this rule do 

not have any substantial direct effect on 

states, on the relationship between the 

national government and the states, or 

on the distribution of power and 

responsibilities among the various 

levels of government. Nor does this rule 

impose substantial direct compliance 

costs on state and local governments. 

Therefore, consultation with the states 

is not required. 

Executive Order 13175 

The policies contained in this rule do 

not impose substantial unreimbursed 


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14308 Federal Register / Vol. 77, No. 47 / Friday, March 9, 2012 / Proposed Rules 

direct compliance costs on Indian tribal, 

Alaska native, or native Hawaiian 

governments and sovereign institutions 

or have tribal implications that preempt 

tribal law. 

Background 

USDA Rural Development (RD) is a 

mission area within the U.S. 

Department of Agriculture comprised of 

the Rural Housing Service, Rural 

Business/Cooperative Service and Rural 

Utilities Service. Rural Development’s 

mission is to increase economic 

opportunity and improve the quality of 

life for all rural Americans. Rural 

Development meets its mission by 

providing loans, loan guarantees, grants 

and technical assistance through more 

than forty programs aimed at creating 

and improving housing, businesses and 

infrastructure throughout rural America. 

The RUS loan, loan guarantee and 

grant programs act as a catalyst for 

economic and community development. 

By financing improvements to rural 

electric, water and waste, and telecom 

and broadband infrastructure, RUS also 

plays a significant role in improving 

other measures of quality of life in rural 

America, including public health and 

safety, environmental protection, 

conservation, and cultural and historic 

preservation. 

The Consolidated Farm and Rural 

Development Act (CONACT) authorizes 

USDA to provide loans and grants for 

the development, storage, treatment, 

purification, or distribution of water; 

and for the collection, treatment, or 

disposal of waste in rural areas. Section 

306C of the CONACT directs USDA to 

provide loans and grants to Indian 

Tribes and other targeted areas, such as 

colonias, for the construction of new 

water and waste systems, or for the 

extension or improvement of such 

systems, in rural areas. The loans and 

grants are to be available to provide 

these facilities only to communities 

whose residents face significant health 

risks, as determined by the Secretary, 

due to the fact that a significant 

proportion of the community’s residents 

do not have access to, or are not served 

by, adequate affordable water supply 

systems or waste disposal facilities. The 

Agency provides such loans and grants 

through its regulation, 7 CFR 1777, 

providing assistance to colonias along 

the U.S. Mexican border. 

Currently, the Rural Utilities Service 

prioritizes potential projects filed 

pursuant to 7 CFR 1777, based upon a 

point system, wherein the greatest 

possible number of points (50) is given 

to proposed projects that seek to provide 

water and/or waste disposal services to 

a colonia. Colonias are communities 

along the U.S.-Mexico border that are 

defined in 7 CFR 1777.4 as ‘‘Any 

identifiable community designated in 

writing by the State or county in which 

it is located; determined to be a colonia 

on the basis of objective criteria 

including lack of potable water supply, 

lack of adequate sewage systems, and 

lack of decent, safe and sanitary 

housing, inadequate roads and drainage; 

and existed and was generally 

recognized as a colonia before October 

1, 1989.’’ 

RUS remains committed to improving 

the quality of, and access to, water and 

waste services in colonias areas, and 

often collaborates and coordinates with 

other federal and state funders to do so. 

Since the inception of the 7 CFR 1777 

grant program for colonias in 1993, RUS 

has provided $425.5 million in grants 

for 519 projects serving colonias areas. 

RUS has also provided funding to Rural 

Development’s Rural Housing Service 

customers, resulting in $22,137,827 

worth of assistance to 6,693 households 

in colonias areas. This has allowed 

affected colonias to connect to 

community water and waste systems. In 

addition, USDA continues to work with 

state and local partners to seek new 

ways to improve program delivery in 

these areas. 

In December 2009, the Government 

Accountability Office (GAO) released a 

report describing a number of perceived 

inadequacies in Federal Government 

programs across various agencies 

focused on assisting colonias. In the 

report, GAO recommended that the 

Secretary of Agriculture direct Rural 

Development to revise its process to 

ensure that the agency only provide 

Section 306C colonia funds to projects 

that benefit colonias, as defined by 

Federal statute. While USDA disagrees 

with GAO’s assertion that 306C funds 

are currently allocated contrary to 

statutory intent, the agency understands 

that more should be done to ensure that 

those colonias most in need, especially 

those that remain unserved, are better 

targeted for funding. 

In an effort to better serve colonias 

areas, and to address concerns raised by 

GAO, RUS reviewed 7 CFR 1777 as it 

pertains to projects serving colonias. 

Purpose of This Document 

The purpose of this document is to 

make a minor clarification change to 7 

CFR 1777.12 and to revise 7 CFR 

1777.13. 7 CFR 1777.12 is revised to 

include specific information on 

documentation to support a 

determination of a significant health 

risk. The revision to 7 CFR 1777.13 

focuses specifically on the priority point 

system used in selecting projects for 

306C funding, in order to ensure that 

colonias that lack access to water and/ 

or waste disposal systems, and that are 

facing significant health problems, are 

given priority consideration for 306C 

funding. 

This document also seeks comment 

on potential incentives to encourage 

established regional or other rural water 

systems, in good financial standing and 

with sufficient operating capacity, to 

extend service to colonias that have no 

access to water and/or waste disposal 

services. 

Additionally, this document is a 

request for comments regarding the 

communities on the U.S.-Mexico border 

designated as colonias. In particular, 

RUS seeks comment regarding how its 

programs and other federal, state and 

local government programs might be 

leveraged to better serve these areas and 

create sustainable communities. Any 

individual or entity with comments 

concerning the Water and Waste 

Disposal (WWD) Loans and Grants 

program or other comments regarding 

colonias-related issues is asked to 

provide comments to RUS as specified 

above. 

Discussion of Proposed Changes 

1. RUS proposes to amend 7 CFR 

1777.12(b) to add specific requirements 

regarding the type of documentation 

that will support a determination of a 

significant health risk. 

2. Currently, 7 CFR 1777.13 allocates 

50 points to projects that serve colonias. 

RUS proposes to amend 7 CFR 1777.13 

by including language that allows for 

additional priority points to be given to 

colonias that lack any access to water 

and/or waste disposal systems, and to 

those that are facing significant health 

risk. This is intended to ensure that RUS 

is reaching those colonias with the most 

need. Specifically, projects proposing to 

serve colonias that either lack access to 

community systems that supply water 

meeting Safe Drinking Water Act 

standards or that lack waste disposal 

services (unserved), resulting in a 

documented significant health or 

sanitary risk, would receive 40 points. 

Projects proposing to serve colonias that 

lack access to community systems that 

supply water meeting Safe Drinking 

Water Act standards and that lack waste 

disposal services (unserved), resulting 

in a documented health or sanitary risk, 

would receive 50 points. Projects 

proposing to serve colonias that have 

access to community systems that 

supply water meeting Safe Drinking 

Water Act and waste disposal services, 

but are facing documented health or 

sanitary risks, would receive 15 points. 

These changes allow for the 


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Federal Register / Vol. 77, No. 47 / Friday, March 9, 2012 / Proposed Rules 14309 

differentiation between those colonias 

that are seeking funding for additional 

improvements or expansion, and those 

that lack basic water and waste disposal 

systems and/or that face significant 

health risks. 

3. RUS proposes to amend 7 CFR 

1777.13 by removing all occurrences of 

the word ‘‘preapplication’’ and 

replacing it with the word 

‘‘application’’. This will reflect a change 

in RUS procedure implemented several 

years ago which eliminated the use of 

preapplications. 

4. RUS proposes to remove text in 

1777.13(b) and (d) that are internal 

instructions. 

Request for Comments 

USDA is also seeking input on 

potential amendments to 7 CFR 1777.11 

that would provide incentives for 

county, regional and other established 

and successful eligible water and waste 

systems to provide service to colonias 

areas that have no in-home access to 

community water and/or waste disposal 

infrastructure. In some areas without 

access, there is a lack of managerial, 

technical and financial capacity to 

operate and maintain rural water and 

waste facilities. One way to bring 

reliable, affordable service to such an 

area would involve the expansion of a 

neighboring established county, regional 

or other rural water or waste disposal 

system. 

1. The Agency seeks comment on the 

possibility of incentivizing the 

expansion of existing systems into 

colonias areas by providing loan and 

grant funds to eligible, qualified existing 

entities who are seeking to serve an 

existing colonia. This determination 

would be based on the ability of the 

proposed service area to repay debt 

rather than on the repayment ability of 

the entire system. The Agency seeks 

comment on whether this approach 

would be effective in encouraging these 

entities to provide service to unserved 

colonias areas. 

2. The Agency seeks comment 

regarding what safeguards might be 

needed to ensure that the limited grant 

funding available to service colonias is 

applied only where it is critically 

needed. Should proposed service areas 

considered under such a proposal be at 

or below per capita poverty income 

level for the state? Should this approach 

only be available to those areas with no 

access? Should it exclude expansion 

within an existing colonia to unserved 

houses? Should fully improved Colonias 

lose the ‘‘colonias’’ designation? 

3. The Agency seeks additional 

suggestions on how to encourage the 

provision of sustainable service in the 

colonias. Suggestions may range from 

additional modifications of regulations 

to specific technical assistance and 

training programs for colonias areas. To 

facilitate the discussion, RUS has 

developed the following questions. 

What are the primary challenges to 

establishing and sustaining rural water 

and waste disposal services in colonias 

areas? Should alternative technology for 

services be considered in the colonias? 

Are appropriate governance structures 

in place to support local services? What 

type of technical assistance is needed in 

colonias without access to water and 

waste services? What local and/or 

regional partners can help facilitate or 

promote sustainable water and waste 

systems in colonia areas? 

List of Subjects 

Community development, 

Community facilities, Grant programs— 

housing and community development, 

Loan programs—housing and 

community development, Reporting and 

recordkeeping requirements, Rural 

areas, Waste treatment and disposal, 

Water supply, Watersheds. 

For the reasons discussed in the 

preamble, RUS proposes to amend 7 

CFR 1777 as follows: 

PART 1777—SECTION 306C WWD 

LOANS AND GRANTS 

1. The authority citation for part 1777 

continues to read as follows: 

Authority: 5 U.S.C. 301; 7 U.S.C. 1989; 16 

U.S.C. 1005. 

2. Amend section 1777.12 by revising 

paragraph (b) to add a sentence to the 

end and subparagraphs (1) through (4) 

to read as follows: 

§ 1777.12 Eligibility. 

* * * * * 

(b) * * * The following requirements 

regarding the documentation must be 

followed: 

(1) The originating documentation 

must come from an independent third 

party source that has the experience in 

specifying the health or sanitary 

problem that currently exists. 

(2) The documentation must state 

specifically the health or sanitary 

problems that exist. General statements 

of problems or support for the project 

are not acceptable. 

(3) Current users of the facility must 

be experiencing the current health or 

sanitary problem and not future or 

possible users. 

(4) If no facility exists, documentation 

must include specific health and 

sanitary problems associated with 

individual facilities that currently exist 

to warrant the health and sanitary 

determination. 

3. Revise section 1777.13 to read as 

follows: 

§ 1777.13 Project priority. 

Paragraphs (a) through (d) of this 

section indicate items and conditions 

which must be considered in selecting 

applications for further development. 

When ranking eligible applications for 

consideration for limited funds, Agency 

officials must consider the priority 

items met by each application and the 

degree to which those priorities are met. 

(a) Applications. The application and 

supporting information submitted with 

it will be used to determine applicant 

eligibility and the proposed project’s 

priority for available funds. Applicants 

determined ineligible will be advised of 

their appeal rights in accordance with 7 

CFR part 11. 

(b) State Office review. All 

applications will be processed and 

scored in the area office and then 

reviewed for funding priority at the 

State Office using RUS Bulletin 1777–2. 

Eligible applicants that cannot be 

funded will be advised that funds are 

not available and advised of their appeal 

rights as set forth in 7 CFR part 11. 

(c) National Office. The National 

Office will allocate funds on a projectby-project basis as requests are received 

from the State Office. If the amount of 

funds requested exceeds the amount of 

funds available, the total project score 

will be used to select projects for 

funding. The RUS Administrator may 

assign up to 35 additional points that 

will be considered in the total points for 

items such as geographic distribution of 

funds, severity of health risks, etc. 

Unobligated funds will be pooled by 

mid-August of each year and made 

available to all States with eligible 

colonias applicants on a case-by-case 

basis. 

(d) Selection priorities. The priorities 

described below will be used to rate 

applications and in selecting projects for 

funding. Points will be distributed as 

indicated in paragraphs (d)(1) through 

(d)(6) of this section and will be used in 

selecting projects for funding. 

(1) Population. The proposed project 

will serve an area with a rural 

population: 

(i) Not in excess of 1,500—30 points. 

(ii) More than 1,500 and not in excess 

of 3,000—20 points. 

(iii) More than 3,000 and not in excess 

of 5,500—10 points. 

(2) Income. The median household 

income of population to be served by 

the proposed project is: 


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14310 Federal Register / Vol. 77, No. 47 / Friday, March 9, 2012 / Proposed Rules 

(i) Not in excess of 50 percent of the 

statewide nonmetropolitan median 

household income—40 points. 

(ii) More than 50 percent and not in 

excess of 60 percent of the statewide 

nonmetropolitan median household 

income—20 points. 

(iii) More than 60 percent and not in 

excess of 70 percent of the statewide 

nonmetropolitan median household 

income—10 points. 

(3) Joint financing. The amount of 

joint financing committed to the 

proposed project is: 

(i) Twenty percent or more private, 

local, or State funds except Federal 

funds channeled through a State 

agency—10 points. 

(ii) Five to 19 percent private, local, 

or State funds except Federal funds 

channeled through a State agency—5 

points. 

(4) Colonia. (See definition in 

§ 1777.4). The proposed project will 

provide water and/or waste disposal 

services to the residents of a colonia:— 

50 points. Additional points will be 

assigned as follows: 

(5) Access and health risks for 

colonias. (i) A colonia that lacks access 

to both water and waste disposal 

facilities, resulting in a significant 

health risk—50 points. 

(ii) A colonia that lacks access to 

either water or waste disposal facilities, 

resulting in a significant health risk—40 

points. 

(iii) A colonia that has access to water 

and waste disposal facilities, but is 

facing a significant health risk—15 

points. 

(6) Discretionary. In certain cases, and 

when a written justification is prepared, 

the State Program Official with loan/ 

grant approval authority may assign up 

to 15 points for items such as natural 

disaster, to improve compatibility/ 

coordination between the Agency’s and 

other agencies’ selection systems, to 

assist those projects that are the most 

cost effective, high unemployment rate, 

severity of health risks, etc. 

Dated: February 29, 2012. 

Jonathan Adelstein, 

Administrator, Rural Utilities Service. 

[FR Doc. 2012–5627 Filed 3–8–12; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2012–0222; Directorate 

Identifier 2011–SW–007–AD] 

RIN 2120–AA64 

Airworthiness Directives; Eurocopter 

France Helicopters 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Notice of proposed rulemaking 

(NPRM). 

SUMMARY: We propose to adopt a new 

airworthiness directive (AD) for certain 

Eurocopter France Model AS350 

helicopters. This proposed AD is 

prompted by an in-flight fire caused by 

ignition of hydraulic fluid leaking from 

a damaged forward (pitch) servo-control 

hydraulic hose. The proposed actions 

are intended to prevent the forward 

servo-control hydraulic hoses from 

becoming damaged and leaking 

hydraulic fluid that could ignite in 

flight, which can result in loss of main 

rotor control, power loss, structural 

damage, propagation of fire, and 

subsequent loss of control of the 

helicopter. 

DATES: We must receive comments on 

this proposed AD by May 8, 2012. 

ADDRESSES: You may send comments by 

any of the following methods: 

• Federal eRulemaking Docket: Go to 

http://www.regulations.gov. Follow the 

online instructions for sending your 

comments electronically. 

• Fax: 202–493–2251. 

• Mail: Send comments to the U.S. 

Department of Transportation, Docket 

Operations, M–30, West Building 

Ground Floor, Room W12–140, 1200 

New Jersey Avenue SE., Washington, 

DC 20590–0001. 

• Hand Delivery: Deliver to the 

‘‘Mail’’ address between 9 a.m. and 

5 p.m., Monday through Friday, except 

Federal holidays. 

Examining the AD Docket: You may 

examine the AD docket on the Internet 

at http://www.regulations.gov or in 

person at the Docket Operations Office 

between 9 a.m. and 5 p.m., Monday 

through Friday, except Federal holidays. 

The AD docket contains this proposed 

AD, the economic evaluation, any 

comments received, and other 

information. The street address for the 

Docket Operations Office (telephone 

800–647–5527) is in the ADDRESSES

section. Comments will be available in 

the AD docket shortly after receipt. 

For service information identified in 

this proposed AD, contact American 

Eurocopter Corporation, 2701 N. Forum 

Drive, Grand Prairie, TX 75052, 

telephone (972) 641–0000 or (800) 232– 

0323, fax (972) 641–3775, or at http:// 

www.eurocopter.com/techpub. You may 

review copies of the referenced service 

information at the FAA, Office of the 

Regional Counsel, Southwest Region, 

2601 Meacham Blvd., Room 663, Fort 

Worth, Texas 76137. 

FOR FURTHER INFORMATION CONTACT: Matt 

Wilbanks, Aerospace Engineer, FAA, 

Rotorcraft Directorate, Regulations and 

Policy Group, 2601 Meacham 

Boulevard, Fort Worth, Texas 76137; 

telephone (817) 222–5051; email 

matt.wilbanks@faa.gov. 

SUPPLEMENTARY INFORMATION: 

Comments Invited 

We invite you to participate in this 

rulemaking by submitting written 

comments, data, or views. We also 

invite comments relating to the 

economic, environmental, energy, or 

federalism impacts that might result 

from adopting the proposals in this 

document. The most helpful comments 

reference a specific portion of the 

proposal, explain the reason for any 

recommended change, and include 

supporting data. To ensure the docket 

does not contain duplicate comments, 

commenters should send only one copy 

of written comments, or if comments are 

filed electronically, commenters should 

submit only one time. 

We will file in the docket all 

comments that we receive, as well as a 

report summarizing each substantive 

public contact with FAA personnel 

concerning this proposed rulemaking. 

Before acting on this proposal, we will 

consider all comments we receive on or 

before the closing date for comments. 

We will consider comments filed after 

the comment period has closed if it is 

possible to do so without incurring 

expense or delay. We may change this 

proposal in light of the comments we 

receive. 

Discussion 

The European Aviation Safety Agency 

(EASA), which is the Technical Agent 

for the Member States of the European 

Union, has issued AD No. 2011–0033, 

dated March 1, 2011 (AD 2011–0033) to 

correct an unsafe condition for the 

Eurocopter AS350 B, BA, BB, D, B1, B2, 

and B3 helicopters with a single 

hydraulic power system and forward 

(pitch) servo-control hydraulic hoses 

part number (P/N) 704A34–412–033 

(other reference manufacturer’s part 

number (MP/N) 675–102–05–01) and 

P/N 704A34–412–035 (other reference 

MP/N 675–102–06–01) installed. EASA 


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