Federal Register / Vol. 77, No. 76 / Thursday, April 19, 2012 / Proposed Rules 23429 

Dated: April 6, 2012. 

Daniel J. Basta, 

Director for the Office of National Marine 

Sanctuaries. 

Dated: April 3, 2012. 

Cynthia K. Dohner, 

Regional Director, Fish and Wildlife Service. 

[FR Doc. 2012–9345 Filed 4–18–12; 8:45 am] 

BILLING CODE 3510–NK–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 53 

[REG–144267–11] 

RIN 1545–BK76 

Examples of Program-Related 

Investments 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: This document contains 

proposed regulations that provide 

guidance to private foundations on 

program-related investments. These 

proposed regulations provide a series of 

new examples illustrating investments 

that qualify as program-related 

investments. In addition to private 

foundations, these proposed regulations 

affect foundation managers who 

participate in the making of programrelated investments. 

DATES: Comments and requests for a 

public hearing must be received by July 

18, 2012. 

ADDRESSES: Send submissions to: 

CC:PA:LPD:PR (REG–144267–11), room 

5205, Internal Revenue Service, P.O. 

Box 7604, Ben Franklin Station, 

Washington, DC 20044. Submissions 

may be hand-delivered Monday through 

Friday between the hours of 8 a.m. and 

4 p.m. to CC:PA:LPD:PR (REG–144267– 

11), Courier’s Desk, Internal Revenue 

Service, 1111 Constitution Avenue NW., 

Washington, DC, or sent electronically 

via the Federal eRulemaking Portal at 

http://www.regulations.gov/ (IRS REG– 

144267–11). 

FOR FURTHER INFORMATION CONTACT: 

Concerning the proposed regulations, 

Courtney D. Jones at (202) 622–6070; 

concerning submissions of comments 

and requests for a public hearing, 

Oluwafunmilayo Taylor, (202) 622–7180 

(not toll-free numbers). 

SUPPLEMENTARY INFORMATION: 

Background 

Section 4944(a) of the Internal 

Revenue Code (Code) imposes an excise 

tax on a private foundation that makes 

an investment that jeopardizes the 

carrying out of any of the private 

foundation’s exempt purposes (a 

‘‘jeopardizing investment’’). Section 

4944(a) also imposes an excise tax on 

foundation managers who knowingly 

participate in the making of a 

jeopardizing investment. Section 

4944(b) imposes additional excise taxes 

on private foundations and foundation 

managers when investments are not 

timely removed from jeopardy. 

Generally, under § 53.4944–1(a)(2), a 

jeopardizing investment occurs when, 

based on the facts and circumstances at 

the time the investment is made, 

foundation managers fail to exercise 

ordinary business care and prudence in 

providing for the long- and short-term 

financial needs of the foundation. The 

determination of whether an investment 

is a jeopardizing investment is made on 

an investment-by-investment basis, 

taking into account the private 

foundation’s entire portfolio. In 

exercising the requisite standard of care 

and prudence, foundation managers 

may take into account the expected 

investment return, price volatility, and 

the need for portfolio diversification. 

Section 4944(c) excepts programrelated investments (‘‘PRIs’’) from 

treatment as jeopardizing investments. 

The regulations under section 4944(c) 

define a PRI as an investment: (1) The 

primary purpose of which is to 

accomplish one or more of the purposes 

described in section 170(c)(2)(B); (2) no 

significant purpose of which is the 

production of income or the 

appreciation of property; and (3) no 

purpose of which is to accomplish one 

or more of the purposes described in 

section 170(c)(2)(D) (attempting to 

influence legislation or participating in 

or intervening in any political 

campaign). 

An investment is made primarily to 

accomplish one or more of the purposes 

described in section 170(c)(2)(B) 

(referred to as ‘‘charitable purposes’’) if 

it significantly furthers the 

accomplishment of the private 

foundation’s exempt activities and 

would not have been made but for the 

relationship between the investment 

and the accomplishment of those 

exempt activities. In determining 

whether a significant purpose of an 

investment is the production of income 

or the appreciation of property, 

§ 53.4944–3(a)(2)(iii) provides that it 

shall be relevant whether investors who 

are engaged in the investment solely for 

the production of income would be 

likely to make the investment on the 

same terms as the private foundation. 

The regulations under other Code 

sections in Chapter 42 accord special 

tax treatment to PRIs. For example, 

§ 53.4942(a)–2(c)(3)(ii)(d) excludes PRIs 

from the assets a private foundation 

takes into account when determining 

how much it must distribute under 

section 4942 as a ‘‘distributable 

amount’’ for the taxable year. In 

addition, § 53.4942(a)–3(a)(2)(i) 

generally includes distributions that 

qualify as PRIs as ‘‘qualifying 

distributions’’ for purposes of meeting 

the distribution requirements under 

section 4942. Section 53.4943–10(b) 

excludes PRIs from being treated as 

business holdings for the purpose of 

calculating excess business holdings 

subject to excise tax under section 4943. 

Sections 53.4945–5(b)(4) and 53.4945– 

6(c)(1)(i) also make clear that PRIs will 

not constitute taxable expenditures 

under section 4945, provided the 

private foundation exercises 

‘‘expenditure responsibility’’ in 

circumstances in which it is required to 

do so. Among other expenditure 

responsibility requirements, a private 

foundation must require a written 

commitment from the recipient of the 

PRI that the funds received will be used 

only for the purposes of the programrelated investment. As noted, the 

primary purpose of a program-related 

investment must be the accomplishment 

of a charitable purpose. 

Section 53.4944–3(b) contains nine 

examples illustrating investments that 

qualify as PRIs and one example of an 

investment that does not qualify as a 

PRI. The existing examples focus on 

domestic situations principally 

involving economically disadvantaged 

individuals and deteriorated urban 

areas. 

The Treasury Department and the IRS 

are aware that the private foundation 

community would find it helpful if the 

regulations could include additional PRI 

examples that reflect current investment 

practices and illustrate certain 

principles, including that: (1) An 

activity conducted in a foreign country 

furthers a charitable purpose if the same 

activity would further a charitable 

purpose if conducted in the United 

States; (2) the charitable purposes 

served by a PRI are not limited to 

situations involving economically 

disadvantaged individuals and 

deteriorated urban areas; (3) the 

recipients of PRIs need not be within a 

charitable class if they are the 

instruments for furthering a charitable 

purpose; (4) a potentially high rate of 

return does not automatically prevent 

an investment from qualifying as 

program-related; (5) PRIs can be 

achieved through a variety of 


tkelley on DSK3SPTVN1PROD with PROPOSALS
23430 Federal Register / Vol. 77, No. 76 / Thursday, April 19, 2012 / Proposed Rules 

investments, including loans to 

individuals, tax-exempt organizations 

and for-profit organizations, and equity 

investments in for-profit organizations; 

(6) a credit enhancement arrangement 

may qualify as a PRI; and (7) a private 

foundation’s acceptance of an equity 

position in conjunction with making a 

loan does not necessarily prevent the 

investment from qualifying as a PRI. 

Explanation of Provisions 

The proposed regulations add nine 

new examples that illustrate that a 

wider range of investments qualify as 

PRIs than the range currently presented 

in § 53.4944–3(b). The proposed 

regulations do not modify the existing 

regulations; rather, they provide 

additional examples that illustrate the 

application of the existing regulations. 

Generally, the charitable activities 

illustrated in the new examples are 

based on published guidance and on 

financial structures described in private 

letter rulings. 

The new examples demonstrate that a 

PRI may accomplish a variety of 

charitable purposes, such as advancing 

science, combating environmental 

deterioration, and promoting the arts. 

Several examples also demonstrate that 

an investment that funds activities in 

one or more foreign countries, including 

investments that alleviate the impact of 

a natural disaster or that fund 

educational programs for poor 

individuals, may further the 

accomplishment of charitable purposes 

and qualify as a PRI. One example 

illustrates that the existence of a high 

potential rate of return on an investment 

does not, by itself, prevent the 

investment from qualifying as a PRI. 

Another example illustrates that a 

private foundation’s acceptance of an 

equity position in conjunction with 

making a loan does not necessarily 

prevent the investment from qualifying 

as a PRI, and two examples illustrate 

that a private foundation’s provision of 

credit enhancement can qualify as a PRI. 

The last example demonstrates that a 

guarantee arrangement may qualify as a 

PRI. The proposed regulations address 

solely the impact of section 4944 on the 

facts described and do not address 

whether there is a qualifying 

distribution under section 4942. 

However, the Treasury Department and 

the IRS conclude that, based on the facts 

described in the last example, there 

would be no qualifying distribution 

under section 4942 at the time the 

foundation enters into the guarantee 

arrangement. Under certain 

circumstances, a private foundation may 

treat payments made under a guarantee 

arrangement as qualifying distributions. 

Finally, the proposed regulations 

include examples illustrating that loans 

and capital may be provided to 

individuals or entities that are not 

within a charitable class themselves, if 

the recipients are the instruments 

through which the private foundation 

accomplishes its exempt activities. 

Proposed Effective/Applicability Date 

Paragraph (b), Examples 11 through 

19 of this section will be effective on the 

date of publication of the Treasury 

decision adopting these examples as 

final regulations in the Federal Register. 

Taxpayers may rely on paragraph (b), 

Examples 11 through 19 of this section 

before these proposed regulations are 

finalized. 

Special Analyses 

It has been determined that this notice 

of proposed rulemaking is not a 

significant regulatory action as defined 

in Executive Order 12866, as 

supplemented by Executive Order 

13563. Therefore, a regulatory 

assessment is not required. It has also 

been determined that section 553(b) of 

the Administrative Procedure Act (5 

U.S.C. chapter 5) does not apply to this 

regulation, and because the regulation 

does not impose a collection of 

information on small entities, the 

Regulatory Flexibility Act (5 U.S.C. 

chapter 6) does not apply. Pursuant to 

section 7805(f) of the Code, this 

regulation has been submitted to the 

Chief Counsel for Advocacy of the Small 

Business Administration for comment 

on its impact on business. 

Comments and Requests for Public 

Hearing 

Before these proposed regulations are 

adopted as final regulations, 

consideration will be given to any 

comments that are submitted timely to 

the IRS as prescribed in this preamble 

under the ADDRESSES heading. The IRS 

and the Treasury Department request 

comments on all aspects of the proposed 

rules. All comments will be available at 

www.regulations.gov or upon request. A 

public hearing will be scheduled if 

requested in writing by any person that 

timely submits written comments. If a 

public hearing is scheduled, notice of 

the date, time, and place for the public 

hearing will be published in the Federal 

Register. 

Drafting Information 

The principal author of these 

proposed regulations is Courtney D. 

Jones, Office of the Chief Counsel (Tax 

Exempt and Government Entities). 

However, other personnel from the 

Treasury Department and the IRS 

participated in their development. 

List of Subjects in 26 CFR Part 53 

Excise taxes, Foundations, 

Investments, Lobbying, Reporting and 

recordkeeping requirements, Trusts and 

trustees. 

Proposed Amendments to the 

Regulations 

Accordingly, 26 CFR part 53 is 

proposed to be amended as follows: 

PART 53—FOUNDATION AND SIMILAR 

EXCISE TAXES 

Paragraph. 1. The authority citation 

for part 53 continues to read in part as 

follows: 

Authority: 26 U.S.C. 7805 * * * 

Par. 2. Section 53.4944–3 is amended 

by adding Examples 11, 12, 13, 14, 15, 

16, 17, 18, and 19 to paragraph (b) and 

adding paragraph (c) to read as follows: 

§ 53.4944–3 Exception for program-related 

investments. 

* * * * * 

(b) * * * 

Example 11. X is a business enterprise that 

researches and develops new drugs. X’s 

research demonstrates that a vaccine can be 

developed within ten years to prevent a 

disease that predominantly affects poor 

individuals in developing countries. 

However, neither X nor other commercial 

enterprises like X will devote their resources 

to develop the vaccine because the potential 

return on investment is significantly less 

than required by X or other commercial 

enterprises to undertake a project to develop 

new drugs. Y, a private foundation, enters 

into an investment agreement with X in order 

to induce X to develop the vaccine. Pursuant 

to the investment agreement, Y purchases 

shares of the common stock of S, a subsidiary 

corporation that X establishes to research and 

develop the vaccine. The agreement requires 

S to distribute the vaccine to poor 

individuals in developing countries at a price 

that is affordable to the affected population. 

The agreement also requires S to publish the 

research results, disclosing substantially all 

information about the results that would be 

useful to the interested public. S agrees that 

the publication of its research results will be 

made as promptly after the completion of the 

research as is reasonably possible without 

jeopardizing S’s right to secure patents 

necessary to protect its ownership or control 

of the results of the research. The expected 

rate of return on Y’s investment in S is less 

than the expected market rate of return for an 

investment of similar risk. Y’s primary 

purpose in making the investment is to 

advance science. No significant purpose of 

the investment involves the production of 

income or the appreciation of property. The 

investment significantly furthers the 

accomplishment of Y’s exempt activities and 

would not have been made but for such 

relationship between the investment and Y’s 


tkelley on DSK3SPTVN1PROD with PROPOSALS
Federal Register / Vol. 77, No. 76 / Thursday, April 19, 2012 / Proposed Rules 23431 

exempt activities. Accordingly, the purchase 

of the common stock of S is a programrelated investment. 

Example 12. Q, a developing country, 

produces a substantial amount of recyclable 

solid waste materials that are currently 

disposed of in landfills and by incineration, 

contributing significantly to environmental 

deterioration in Q. X is a new business 

enterprise located in Q. X’s only activity will 

be collecting recyclable solid waste materials 

in Q and delivering those materials to 

recycling centers that are inaccessible to a 

majority of the population. If successful, the 

recycling collection business would prevent 

pollution in Q caused by the usual 

disposition of solid waste materials. X has 

obtained funding from only a few 

commercial investors who are concerned 

about the environmental impact of solid 

waste disposal. Although X made substantial 

efforts to procure additional funding, X has 

not been able to obtain sufficient funding 

because the expected rate of return is 

significantly less than the acceptable rate of 

return on an investment of this type. Because 

X has been unable to attract additional 

investors on the same terms as the initial 

investors, Y, a private foundation, enters into 

an investment agreement with X to purchase 

shares of X’s common stock on the same 

terms as X’s initial investors. Although there 

is a high risk associated with the investment 

in X, there is also the potential for a high rate 

of return if X is successful in the recycling 

business in Q. Y’s primary purpose in 

making the investment is to combat 

environmental deterioration. No significant 

purpose of the investment involves the 

production of income or the appreciation of 

property. The investment significantly 

furthers the accomplishment of Y’s exempt 

activities and would not have been made but 

for such relationship between the investment 

and Y’s exempt activities. Accordingly, the 

purchase of the common stock is a programrelated investment. 

Example 13. Assume the facts as stated in 

Example 12, except that X offers Y shares of 

X’s common stock in order to induce Y to 

make a below-market rate loan to X. X 

previously made the same offer to a number 

of commercial investors. These investors 

were unwilling to provide loans to X on such 

terms because the expected return on the 

combined package of stock and debt was 

below the expected market return for such an 

investment based on the level of risk 

involved, and they were also unwilling to 

provide loans on other terms X considers 

economically feasible. Y accepts the stock 

and makes the loan on the same terms that 

X offered to the commercial investors. Y 

plans to liquidate its stock in X as soon as 

the recycling collection business in Q is 

profitable or it is established that the 

business will never become profitable. Y’s 

primary purpose in making the investment is 

to combat environmental deterioration. No 

significant purpose of the investment 

involves the production of income or the 

appreciation of property. The investment 

significantly furthers the accomplishment of 

Y’s exempt activities and would not have 

been made but for such relationship between 

the investment and Y’s exempt activities. 

Accordingly, the loan accompanied by the 

acceptance of common stock is a programrelated investment. 

Example 14. X is a business enterprise 

located in V, a rural area in State Z. X 

employs a large number of poor individuals 

in V. A natural disaster occurs in V, causing 

significant damage to the area. The business 

operations of X are harmed because of 

damage to X’s equipment and buildings. X 

has insufficient funds to continue its 

business operations and conventional 

sources of funds are unwilling or unable to 

provide loans to X on terms it considers 

economically feasible. In order to enable X to 

continue its business operations, Y, a private 

foundation, makes a loan to X bearing 

interest below the market rate for commercial 

loans of comparable risk. Y’s primary 

purpose in making the loan is to provide 

relief to the poor and distressed. No 

significant purpose of the loan involves the 

production of income or the appreciation of 

property. The loan significantly furthers the 

accomplishment of Y’s exempt activities and 

would not have been made but for such 

relationship between the loan and Y’s 

exempt activities. Accordingly, the loan is a 

program-related investment. 

Example 15. A natural disaster occurs in 

W, a developing country, causing significant 

damage to W’s infrastructure. Y, a private 

foundation, makes loans bearing interest 

below the market rate for commercial loans 

of comparable risk to H and K, poor 

individuals who live in W, to enable each of 

them to start a small business. H will open 

a roadside fruit stand. K will start a weaving 

business. Conventional sources of funds were 

unwilling or unable to provide loans to H or 

K on terms they consider economically 

feasible. Y’s primary purpose in making the 

loans is to provide relief to the poor and 

distressed. No significant purpose of the 

loans involves the production of income or 

the appreciation of property. The loans 

significantly further the accomplishment of 

Y’s exempt activities and would not have 

been made but for such relationship between 

the loans and Y’s exempt activities. 

Accordingly, the loans to H and K are 

program-related investments. 

Example 16. X is a limited liability 

company treated as a partnership for federal 

income tax purposes. X purchases coffee 

from poor farmers residing in a developing 

country, either directly or through farmerowned cooperatives. To fund the provision of 

efficient water management, crop cultivation, 

pest management, and farm management 

training to the poor farmers by X, Y, a private 

foundation, makes a loan to X bearing 

interest below the market rate for commercial 

loans of comparable risk. The loan agreement 

requires X to use the proceeds from the loan 

to provide the training to the poor farmers. 

X would not provide such training to the 

poor farmers absent the loan. Y’s primary 

purpose in making the loan is to educate 

poor farmers about advanced agricultural 

methods. No significant purpose of the loan 

involves the production of income or the 

appreciation of property. The loan 

significantly furthers the accomplishment of 

Y’s exempt activities and would not have 

been made but for such relationship between 

the loan and Y’s exempt activities. 

Accordingly, the loan is a program-related 

investment. 

Example 17. X is a social welfare 

organization that is recognized as an 

organization described in section 501(c)(4). X 

was formed to develop and encourage 

interest in painting, sculpture and other art 

forms by, among other things, conducting 

weekly community art exhibits. X needs to 

purchase a large exhibition space to 

accommodate the demand for exhibition 

space within the community. Conventional 

sources of funds are unwilling or unable to 

provide funds to X on terms it considers 

economically feasible. Y, a private 

foundation, makes a loan to X at an interest 

rate below the market rate for commercial 

loans of comparable risk to fund the purchase 

of the new space. Y’s primary purpose in 

making the loan is to promote the arts. No 

significant purpose of the loan involves the 

production of income or the appreciation of 

property. The loan significantly furthers the 

accomplishment of Y’s exempt activities and 

would not have been made but for such 

relationship between the loan and Y’s 

exempt activities. Accordingly, the loan is a 

program-related investment. 

Example 18. X is a non-profit corporation 

that provides child care services in a lowincome neighborhood, enabling many 

residents of the neighborhood to be gainfully 

employed. X meets the requirements of 

section 501(k) and is recognized as an 

organization described in section 501(c)(3). 

X’s current child care facility has reached 

capacity and has a long waiting list. X has 

determined that the demand for its services 

warrants the construction of a new child care 

facility in the same neighborhood. X is 

unable to obtain a loan from conventional 

sources of funds including B, a commercial 

bank, because X lacks sufficient credit to 

support the financing of a new facility. 

Pursuant to a deposit agreement, Y, a private 

foundation, deposits $h in B, and B lends an 

identical amount to X to construct the new 

child care facility. The deposit agreement 

requires Y to keep $h on deposit with B 

during the term of X’s loan and provides that 

if X defaults on the loan, B may deduct the 

amount of the default from the deposit. To 

facilitate B’s access to the funds in the event 

of default, the agreement requires that the 

funds be invested in instruments that allow 

B to access them readily. The deposit 

agreement also provides that Y will earn 

interest at a rate of t% on the deposit. The 

t% rate is substantially less than Y could 

otherwise earn on this sum of money, if Y 

invested it elsewhere. The loan agreement 

between B and X requires X to use the 

proceeds from the loan to construct the new 

child care facility. Y’s primary purpose in 

making the deposit is to further its 

educational purposes by enabling X to 

provide child care services within the 

meaning of section 501(k). No significant 

purpose of the deposit involves the 

production of income or the appreciation of 

property. The deposit significantly furthers 

the accomplishment of Y’s exempt activities 

and would not have been made but for such 

relationship between the deposit and Y’s 

exempt activities. Accordingly, the deposit is 

a program-related investment. 


tkelley on DSK3SPTVN1PROD with PROPOSALS
23432 Federal Register / Vol. 77, No. 76 / Thursday, April 19, 2012 / Proposed Rules 

Example 19. Assume the same facts as 

stated in Example 18, except that instead of 

making a deposit of $h into B, Y enters into 

a guarantee agreement with B. The guarantee 

agreement provides that if X defaults on the 

loan, Y will repay the balance due on the 

loan to B. B was unwilling to make the loan 

to X in the absence of Y’s guarantee. X must 

use the proceeds from the loan to construct 

the new child care facility. At the same time, 

X and Y enter into a reimbursement 

agreement whereby X agrees to reimburse Y 

for any and all amounts paid to B under the 

guarantee agreement. The signed guarantee 

and reimbursement agreements together 

constitute a ‘‘guarantee and reimbursement 

arrangement.’’ Y’s primary purpose in 

entering into the guarantee and 

reimbursement arrangement is to further Y’s 

educational purposes. No significant purpose 

of the guarantee and reimbursement 

arrangement involves the production of 

income or the appreciation of property. The 

guarantee and reimbursement arrangement 

significantly furthers the accomplishment of 

Y’s exempt activities and would not have 

been made but for such relationship between 

the guarantee and reimbursement 

arrangement and Y’s exempt activities. 

Accordingly, the guarantee and 

reimbursement arrangement is a programrelated investment. 

(c) Effective/applicability date. 

Paragraph (b), Examples 11 through 19 

of this section will be effective on the 

date of publication of the Treasury 

decision adopting these examples as 

final regulations in the Federal Register. 

Taxpayers may rely on paragraph (b), 

Examples 11 through 19 of this section 

before these proposed regulations are 

finalized. 

Steven T. Miller, 

Deputy Commissioner for Services and 

Enforcement. 

[FR Doc. 2012–9468 Filed 4–18–12; 8:45 am] 

BILLING CODE 4830–01–P 

FEDERAL COMMUNICATIONS 

COMMISSION 

47 CFR Part 73 

[MB Docket No. 08–150; RM–11390; DA 12– 

512] 

Radio Broadcasting Services; Asbury 

and Maquoketa, IA, and Mineral Point, 

WI 

AGENCY: Federal Communications 

Commission. 

ACTION: Proposed rule; dismissal. 

SUMMARY: The Audio Division dismisses 

the petition for rule making filed by KM 

Radio of Independence, LLC, proposing 

the allotment of Channel 238A at 

Mineral Point, Wisconsin, and the 

substitution of reserved Channel *254A 

for reserved vacant Channel *238A at 

Asbury, Iowa, 73 FR 50,297, and 

terminates the proceeding. 

FOR FURTHER INFORMATION CONTACT: 

Deborah Dupont, Media Bureau, (202) 

418–2180. 

SUPPLEMENTARY INFORMATION: This is a 

synopsis of the Commission’s Report 

and Order, MB Docket No. 08–150, 

adopted April 2, 2012, and released 

April 2, 2012. The full text of this 

Commission decision is available for 

inspection and copying during normal 

business hours in the FCC Information 

Center, Portals II, 445 12th Street SW., 

Room CY–A257, Washington, DC 20554. 

The complete text of this decision also 

may be purchased from the 

Commission’s duplicating contractor, 

Best Copy and Printing, Inc., 445 12th 

Street SW., Room CY–B402, 

Washington, DC 20554, (800) 378–3160, 

or via the company’s Web site, 

www.bcpiweb.com. The Report and 

Order is not subject to the Congressional 

Review Act, and therefore the 

Commission will not send a copy of it 

in a report to be sent to Congress and 

the Government Accountability Office, 

see U.S.C. 801(a)(1)(A). 

Federal Communications Commission. 

Nazifa Sawez, 

Assistant Chief, Audio Division, Media 

Bureau. 

[FR Doc. 2012–9401 Filed 4–18–12; 8:45 am] 

BILLING CODE 6712–01–P 

DEPARTMENT OF THE INTERIOR 

Fish and Wildlife Service 

50 CFR Part 17 

[Docket No. FWS–R7–ES–2012–0009; 

4500030113] 

RIN 1018–AY40 

Endangered and Threatened Wildlife 

and Plants; Special Rule for the Polar 

Bear 

AGENCY: Fish and Wildlife Service, 

Interior. 

ACTION: Proposed rule; availability of 

draft environmental assessment. 

SUMMARY: We, the U.S. Fish and 

Wildlife Service (Service), propose to 

amend the regulations at 50 CFR part 

17, which implement the Endangered 

Species Act of 1973, as amended (ESA), 

to create a special rule under authority 

of section 4(d) of the ESA that provides 

measures that are necessary and 

advisable to provide for the 

conservation of the polar bear (Ursus 

maritimus). The Secretary has the 

discretion to prohibit by regulation with 

respect to the polar bear any act 

prohibited by section 9(a)(1) of the ESA. 

DATES: We will consider comments we 

receive on or before June 18, 2012. We 

must receive requests for public 

hearings, in writing, at the address 

shown in the FOR FURTHER INFORMATION

CONTACT section by June 4, 2012. 

ADDRESSES: 

Document availability: You can view 

this proposed rule and the associated 

draft environmental assessment on 

http://www.regulations.gov under 

Docket No. FWS–R7–ES–2012–0009. 

Written comments: You may submit 

comments on the proposed rule and 

associated draft environmental 

assessment by one of the following 

methods: 

• U.S. mail or hand-delivery: Public 

Comments Processing, Attn: Docket No. 

FWS–R7–ES–2012–0009; Division of 

Policy and Directives Management; U.S. 

Fish and Wildlife Service; 4401 N. 

Fairfax Drive, MS 2042–PDM; 

Arlington, VA 22203; or 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments to 

Docket No. FWS–R7–ES–2012–0009. 

Please indicate to which document, 

the proposed rule or the draft 

environmental assessment, your 

comments apply. We will post all 

comments on http:// 

www.regulations.gov. This generally 

means that we will post any personal 

information you provide us (see the 

Public Comments section below for 

more information). 

FOR FURTHER INFORMATION CONTACT: 

Charles Hamilton, Marine Mammals 

Management Office, U.S. Fish and 

Wildlife Service, Region 7, 1011 East 

Tudor Road, Anchorage, AK 99503; 

telephone 907–786–3309. Persons who 

use a telecommunications device for the 

deaf (TDD) may call the Federal 

Information Relay Service (FIRS) at 

1–800–877–8339, 24 hours a day, 

7 days a week. 

SUPPLEMENTARY INFORMATION: 

Executive Summary 

Why We Need To Publish a Proposed 

Rule 

In response to litigation against the 

Service challenging our December 16, 

2008 final 4(d) special rule for the polar 

bear, the District Court for the District 

of Columbia (Court) found that although 

the final 4(d) special rule for the polar 

bear was consistent with the ESA, the 

Service violated the National 

Environmental Policy Act (NEPA) and 

the Administrative Procedure Act by 

failing to conduct a NEPA analysis 

when it promulgated the final 4(d) 


tkelley on DSK3SPTVN1PROD with PROPOSALS