This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

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new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

60951 

Vol. 79, No. 196 

Thursday, October 9, 2014 

1Consistent with longstanding practice, DOT 

calculates the shortest driving distance between an 

EAS community and a large or medium hub airport 

from the center of the EAS community to the 

entrance of the nearest large or medium hub airport 

as determined by the Federal Highway 

Administration. 

DEPARTMENT OF TRANSPORTATION 

14 CFR Part 398 

[Docket No.: DOT–OST–2014–0061] 

Essential Air Service Enforcement 

Policy 

AGENCY: Office of Aviation Analysis 

(X50), Department of Transportation 

(DOT). 

ACTION: Final notice of enforcement 

policy. 

SUMMARY: This notice of enforcement 

policy announces how the Department 

of Transportation (DOT or Department) 

will enforce compliance with the 

requirements of the Department of 

Transportation and Related Agencies 

Appropriations Act, 2000, which 

prohibits the Department from 

subsidizing Essential Air Service (EAS) 

to communities located within the 48 

contiguous States receiving per 

passenger subsidy amounts exceeding 

$200, unless the communities are 

located more than 210 miles from the 

nearest large or medium hub airport. All 

communities receiving subsidized EAS 

have until September 30, 2015, based on 

data from October 1, 2014 through 

September 30, 2015, to ensure 

compliance with the $200 subsidy cap 

or face termination of subsidy 

eligibility. After September 30, 2015, the 

Department will enforce the $200 

subsidy cap on an annual basis based on 

data compiled at the end of every fiscal 

year. Consistent with established 

procedures, DOT will issue a showcause order to each EAS community 

that has been identified as failing to 

meet the $200 per passenger subsidy 

requirement. Each such community will 

have a fair and reasonable opportunity 

to demonstrate compliance with the 

$200 subsidy cap prior to a final 

decision by DOT. In addition, any 

community that is deemed ineligible 

under the $200 subsidy cap provision 

may petition the Secretary for a waiver. 

After receiving a community’s petition 

for a waiver, the Secretary may waive 

the subsidy cap for a limited period of 

time, on a case-by-case basis, and 

subject to the availability of funds. To 

provide the Department with sufficient 

time to evaluate the FY 2015 data for 

potentially affected communities, DOT 

does not intend to issue any show-cause 

orders concerning compliance with the 

$200 subsidy cap until 2016. 

DATES: This enforcement policy is 

effective November 10, 2014. 

FOR FURTHER INFORMATION CONTACT: For 

technical questions concerning this 

action, contact Kevin Schlemmer, Chief, 

Essential Air Service and Domestic 

Analysis Division, Office of Aviation 

Analysis, Department of Transportation, 

1200 New Jersey Avenue SE., Room 

W86–309, Washington, DC 20590; 

telephone: (202) 366–3176; 

Kevin.Schlemmer@dot.gov. For legal 

questions concerning this action, 

contact Claire McKenna, Attorney, 

Office of the General Counsel, 

Department of Transportation, 1200 

New Jersey Avenue SE., Room 96–309; 

telephone: (202) 366–0365; email: 

Claire.McKenna@dot.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

The Airline Deregulation Act, passed 

in 1978, gave airlines significant 

flexibility to determine which markets 

to serve domestically and what fares to 

charge for that service. The United 

States Congress (Congress) established 

the EAS program to guarantee that small 

communities that were served by 

certificated air carriers before 

deregulation would maintain at least a 

minimum level of scheduled air service 

after airline deregulation. Since its 

inception, the EAS program has 

provided a vital link for eligible small 

communities to the National Airspace 

System (NAS). Indeed, this program 

ensures that small communities across 

America can tap into the economic and 

quality of life benefits that scheduled air 

services offer. 

Over the years, Congress has made a 

number of statutory changes to the 

program (most recently in 2011 and 

2012), but the fundamental purpose of 

the program remains unchanged. Given 

the socio-economic importance of this 

program, DOT remains committed to 

preserving the EAS program for eligible 

communities and ensuring the 

sustainability of the program for the 

future. 

This enforcement policy concerns the 

statutory mandate that prohibits DOT 

from providing EAS funds to any carrier 

to serve any community in the 48 

contiguous states that requires a perpassenger-subsidy in excess of $200 

unless the community is located more 

than 210 miles from the nearest large or 

medium airport. Congress first imposed 

a $200 subsidy per passenger cap for 

communities in the 48 contiguous States 

in Fiscal Year 1990 appropriations 

language. Such language was repeated 

in several later appropriations acts 

throughout the 1990s, and was made 

permanent by the Department of 

Transportation and Related Agencies 

Appropriations Act, 2000, Public Law 

106–69, 113 Stat. 986 (Oct. 9, 1999). 

Specifically, the Act provides that: 

Hereafter, notwithstanding 49 U.S.C. 41742, 

no essential air service subsidies shall be 

provided to communities in the 48 

contiguous States that are located fewer than 

70 highway miles from the nearest large or 

medium hub airport, or that require a rate of 

subsidy per passenger in excess of $200 

unless such point is greater than 210 miles 

from the nearest large or medium hub airport. 

The Department has always expected 

communities less than 210 miles from a 

large or medium hub airport 1 to work 

together with air carriers providing EAS 

to keep the subsidy per passenger below 

the $200 cap or risk termination of 

eligibility for EAS subsidy. DOT has 

also routinely provided notice of this 

statutory mandate to communities that 

were or appeared to be at risk of 

exceeding the cap, and a number of EAS 

communities have lost their eligibility 

as a result of this requirement. 

Although the $200 subsidy cap is a 

longstanding statutory provision, in 

2012, Congress added a provision that 

allows the Secretary to grant waivers in 

limited circumstances. To effectuate 

that new provision and to ensure the 

fair and consistent treatment of all EAS 

communities subject to the $200 

subsidy cap prospectively, DOT 

published a notice of proposed 

enforcement policy on May 1, 2014, 


tkelley on DSK3SPTVN1PROD with RULES
60952 Federal Register / Vol. 79, No. 196 / Thursday, October 9, 2014 / Rules and Regulations 

seeking public comments on a proposed 

policy to enforce the $200 subsidy cap. 

Comments on the proposal were due 

June 30. 

The Department received seven 

comments on the proposed policy. All 

of the commenters noted that the $200 

subsidy cap established by the 

Department of Transportation and 

Related Agencies Appropriations Act, 

2000, Public Law 106–69, 113 Stat. 986 

(Oct. 9, 1999), has not kept up with the 

pace of inflation, and that enforcement 

of the cap would impose a hardship on 

EAS communities and be contrary to the 

EAS program’s objectives (to ensure 

these communities have air service). We 

recognize these comments; however, the 

requirements of the statute do not 

provide us with discretion to adjust the 

subsidy cap amount or refrain from 

enforcement. 

One commenter offered several 

suggested changes to the proposed 

enforcement policy, such as: (1) The 

subsidy cap should be calculated based 

on actual subsidy paid, not the 

estimates provided in the carrier’s 

proposal that form the basis of the 

subsidy award in the selection order; (2) 

enforcement of the subsidy cap should 

be based on the contract term, not the 

fiscal year—so as to not disadvantage 

carriers and communities that will be 

mid-contract at the time of the 

enforcement action in 2016 (and each 

year after that); and (3) communities 

should be permitted to refund funds to 

the Department, or contribute funds to 

carriers so that the Federal 

Government’s share of the subsidy is 

below the subsidy cap. We appreciate 

these suggestions. 

First, regarding the suggestion that the 

calculation be based on actual subsidy 

paid, the method of calculating per 

passenger subsidy described in the 

Notice of Proposed Enforcement Policy 

reflects the Department’s long standing 

practice. This method formed the basis 

of the enforcement actions taken under 

this provision since it first appeared in 

appropriations language in 1990. 

Carriers and communities are familiar 

with the use of this methodology and 

we do not, at this time, believe that a 

change is warranted. Moreover, if a 

community were over the $200 per 

passenger cap based on the 

Department’s traditional application, 

but under $200 based on actual subsidy 

payments, the community could object 

to a tentative finding in the show-cause 

order or raise this point in a petition for 

waiver, and the Department would then 

assess those arguments on a case-bycase basis. 

Second, with respect to the comment 

on enforcement by contract term, rather 

than fiscal year, the Department believes 

it has given all of the affected parties 

ample time to come into compliance 

with the subsidy cap by delaying 

enforcement until 2016. In addition, 

while most EAS subsidy contracts have 

a two-year term, there are several that 

are for four-year, or even five-year, 

terms. The Department believes it 

would not be fiscally prudent, or fair to 

communities operating under a two year 

contract, to permit communities with 

subsidy caps well in excess of $200 per 

passenger to be essentially excused from 

this statutory requirement for many 

years simply because they are operating 

under longer EAS contracts. While we 

recognize that there may be some 

drawbacks to enforcement on a fiscal 

year basis, there are also drawbacks to 

a contract-based approach, as noted in 

the preceding sentence. With this in 

mind, the Department will move 

forward with the fiscal year based 

approach described in the Notice of 

Proposed Enforcement Policy. We 

believe that this approach is the most 

fair to communities, given the variety of 

contract terms, and is consistent with 

the practice for enforcement of other 

EAS eligibility requirements, such as 

the requirement that EAS communities 

enplane ten or more passengers per day. 

49 U.S.C. 41731(a)(1)(B). The 

Department intends to publish quarterly 

calculations of per passenger subsidies 

at EAS communities on its Web site. We 

believe that this will further support 

communities in their efforts to remain 

below the subsidy cap by providing 

them with on-going notice of their per 

passenger subsidy amounts that will 

hopefully facilitate proactive 

discussions between communities and 

carriers to address potential threats to 

their continued eligibility well in 

advance of any enforcement action by 

the Department. 

Third, regarding the suggestion that 

communities be able to remit funds to 

the Department to lower its subsidy per 

passenger, section 323 of Public Law 

106–69 (Oct. 9, 1999) states that ‘‘no 

[EAS] subsidies shall be provided’’ to 

communities that require a rate of 

subsidy in excess of $200 per passenger. 

The Department has consistently 

construed this not as a limit on the 

Department’s ability to pay more than 

$200 per passenger, but rather, as an 

overall limitation on any subsidy 

payment for EAS service when the 

required subsidy is in excess of $200 per 

passenger. See DOT Order 89–12–52 

(Dec. 29, 1989) (finding that the subsidy 

cap ‘‘was a disqualification for any 

subsidy at a point that exceeded’’ the 

cap). Thus, we do not believe that the 

statute permits this approach. 

Having carefully considered the 

comments received and the statutory 

requirements for eligibility, we are 

finalizing the enforcement policy 

proposed in the Notice of Proposed 

Enforcement Policy, as follows: 

Enforcement Policy 

The Department will begin 

enforcement of the $200 subsidy cap in 

2016, based on data compiled from 

October 1, 2014, through September 30, 

2015, as described in this policy. The 

Department will continue enforcement 

of the $200 subsidy cap on an annual 

basis based on data compiled at the end 

of every fiscal year and submitted to 

DOT after the close of the most recent 

fiscal year. 

If after September 30, 2015 (and each 

September 30 thereafter for the 

preceding fiscal year), a particular 

community’s subsidy per passenger is 

above $200 (as measured on an annual 

basis) and its location is less than 210 

miles from a large or medium hub 

airport, the Department will initiate 

proceedings, consistent with 49 U.S.C. 

41733(f) and Public Law 112–95 (Feb. 

14, 2012), Section 426(c), directing 

interested persons to show cause why 

the Department should not terminate 

the eligibility of the community in 

question under the EAS Program. This 

process will provide each potentially 

affected community with a fair and 

reasonable opportunity to demonstrate 

compliance with the $200 subsidy cap 

prior to a final decision by DOT. 

Communities are reminded that the 

EAS program contains certain statutory 

protections that may be invoked by an 

EAS community adversely affected by 

the $200 per passenger subsidy cap. 

First, in the event that DOT determines 

that a community is ineligible because 

it exceeds the $200 subsidy cap 

provision in a given fiscal year, the 

community may petition the U.S. 

Transportation Secretary for a waiver 

pursuant to Public Law 112–95, Sec. 

426(c) (Feb. 14, 2012). Under this 

provision, ‘‘[s]ubject to the availability 

of funds, the Secretary may waive, on a 

case-by-case basis, the subsidy-perpassenger cap.’’ The law further 

provides: ‘‘A waiver . . . shall remain 

in effect for a limited period of time, as 

determined by the Secretary.’’ Second, a 

community that is deemed ineligible for 

subsidy based on the $200 subsidy cap 

may submit a proposal to the Secretary 

for restoration of subsidy. Upon receipt 

of a proposal, the Department will 

restore the community’s subsidy 

eligibility if the Secretary determines 

that the rate of the per passenger 


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Federal Register / Vol. 79, No. 196 / Thursday, October 9, 2014 / Rules and Regulations 60953 

subsidy under the proposal does not 

exceed $200, and the proposal is likely 

to result in an average of more than 10 

enplanements per day and is consistent 

with the EAS program’s other legal and 

regulatory requirements. 49 U.S.C. 

41733(g). 

Consistent with past practice and the 

Department’s obligations under 49 

U.S.C. 41733(f)(2), DOT encourages 

potentially affected communities to 

work with air carriers providing 

subsidized EAS to maximize use of the 

service awarded under their respective 

carrier-selection orders to avoid 

exceeding the $200 subsidy cap. 

Issued in Washington, DC, on October 2, 

2014. 

Brandon M. Belford, 

Deputy Assistant Secretary for Aviation and 

International Affairs. 

[FR Doc. 2014–24190 Filed 10–8–14; 8:45 am] 

BILLING CODE 4910–9X–P 

DEPARTMENT OF ENERGY 

Federal Energy Regulatory 

Commission 

18 CFR Parts 2 and 38 

[Docket No. RM05–5–022; Order No. 676– 

H] 

Standards for Business Practices and 

Communication Protocols for Public 

Utilities; Correction 

AGENCY: Federal Energy Regulatory 

Commission, DOE. 

ACTION: Final rule; correction. 

SUMMARY: This document contains 

corrections to the final rule in Docket 

No. RM05–5–022 that was published in 

the Federal Register on Wednesday, 

September 24, 2014 (79 FR 56939). The 

final rule amended the Commission’s 

regulations to incorporate by reference, 

with certain enumerated exceptions, the 

latest version (Version 003) of the 

Standards for Business Practices and 

Communication Protocols for Public 

Utilities adopted by the Wholesale 

Electric Quadrant (WEQ) of the North 

American Energy Standards Board 

(NAESB) as mandatory enforceable 

requirements. 

DATES: This correction is effective 

October 24, 2014. Dates for 

implementation are provided in the 

final rule published September 24, 2014 

(79 FR 56939). 

FOR FURTHER INFORMATION CONTACT: 

Tony Dobbins (Technical Issues), Office 

of Energy Policy and Innovation, 

Federal Energy Regulatory 

Commission, 888 First Street NE., 

Washington, DC 20426, (202) 502– 

6630. 

Gary D. Cohen (Legal Issues), Office of 

the General Counsel, Federal Energy 

Regulatory Commission, 888 First 

Street NE., Washington, DC 20426, 

(202) 502–8321. 

SUPPLEMENTARY INFORMATION: 

Need for Correction 

On September 18, 2014, the 

Commission issued a ‘‘Final Rule, Order 

No. 676–H’’ in the above-captioned 

proceeding. Standards for Business 

Practices and Communication Protocols 

for Public Utilities, 148 FERC ¶ 61,205 

(2014). 

This document serves to correct the 

citations of five of the incorporated 

standards listed in PP 18, 89 and in the 

regulatory text to incorporate Standards 

WEQ–000, WEQ–001, WEQ–002, WEQ– 

003 and WEQ–013. We also correct a 

date for waiver requests in P 86. 

Accordingly, we are correcting the 

citations given in the final rule in this 

proceeding (Docket No. RM05–5–022) 

published on September 24, 2014, 79 FR 

56939. 

Corrections to Preamble 

1. On page 56941, third column, and 

page 56942, first column, correct WEQ– 

000, WEQ–001, WEQ–002, and WEQ– 

003 to read as follows: 

• WEQ–000, Abbreviations, 

Acronyms, and Definition of Terms, 

WEQ Version 003, July 31, 2012, as 

modified by NAESB final actions 

ratified on Oct. 4, 2012, Nov. 28, 2012 

and Dec. 28, 2012 (with minor 

corrections applied Nov. 26, 2013); 

• WEQ–001, Open Access Same-Time 

Information System (OASIS), OASIS 

Version 2.0, WEQ Version 003, July 31, 

2012, as modified by NAESB final 

actions ratified on Dec. 28, 2012 (with 

minor corrections applied Nov. 26, 

2013) excluding Standards 001–9.5, 

001–10.5, 001–14.1.3, 001–15.1.2 and 

001–106.2.5; 

• WEQ–002, Open Access Same-Time 

Information System (OASIS) Business 

Practice Standards and Communication 

Protocols (S&CP), OASIS Version 2.0, 

WEQ Version 003, July 31, 2012, as 

modified by NAESB final actions 

ratified on Nov. 28, 2012 and Dec. 28, 

2012 (with minor corrections applied 

Nov. 26, 2013); 

• WEQ–003, Open Access Same-Time 

Information System (OASIS) Data 

Dictionary Business Practice Standards, 

OASIS Version 2.0, WEQ Version 003, 

July 31, 2012, as modified by NAESB 

final actions ratified on Dec. 28, 2012 

(with minor corrections applied Nov. 

26, 2013). 

2. On page 56942, first column, 

correct WEQ–013 to read as follows: 

• WEQ–013, Open Access Same-Time 

Information System (OASIS) 

Implementation Guide, OASIS Version 

2.0, WEQ Version 003, July 31, 2012, as 

modified by NAESB final actions 

ratified on Dec. 28, 2012 (with minor 

corrections applied Nov. 26, 2013). 

3. On page 56950, third column, 

correct ‘‘February 24, 2016’’ to read 

‘‘January 24, 2016’’. 

4. On page 56951, first column, 

correct WEQ–000, WEQ–001, WEQ–002, 

and WEQ–003 to read as follows: 

• WEQ–000, Abbreviations, 

Acronyms, and Definition of Terms, 

WEQ Version 003, July 31, 2012, as 

modified by NAESB final actions 

ratified on Oct. 4, 2012, Nov. 28, 2012 

and Dec. 28, 2012 (with minor 

corrections applied Nov. 26, 2013); 

• WEQ–001, Open Access Same-Time 

Information System (OASIS), OASIS 

Version 2.0, WEQ Version 003, July 31, 

2012, as modified by NAESB final 

actions ratified on Dec. 28, 2012 (with 

minor corrections applied Nov. 26, 

2013) excluding Standards 001–9.5, 

001–10.5, 001–14.1.3, 001–15.1.2 and 

001–106.2.5; 

• WEQ–002, Open Access Same-Time 

Information System (OASIS) Business 

Practice Standards and Communication 

Protocols (S&CP), OASIS Version 2.0, 

WEQ Version 003, July 31, 2012, as 

modified by NAESB final actions 

ratified on Nov. 28, 2012 and Dec. 28, 

2012 (with minor corrections applied 

Nov. 26, 2013); 

• WEQ–003, Open Access Same-Time 

Information System (OASIS) Data 

Dictionary Business Practice Standards, 

OASIS Version 2.0, WEQ Version 003, 

July 31, 2012, as modified by NAESB 

final actions ratified on Dec. 28, 2012 

(with minor corrections applied Nov. 

26, 2013). 

5. On page 56951, second column, 

correct WEQ–013 to read as follows: 

• WEQ–013, Open Access Same-Time 

Information System (OASIS) 

Implementation Guide, OASIS Version 

2.0, WEQ Version 003, July 31, 2012, as 

modified by NAESB final actions 

ratified on Dec. 28, 2012 (with minor 

corrections applied Nov. 26, 2013). 

Corrections to Regulatory Text 

■ 6. On page 56954, third column, and 

page 56955, first column, correct 

§ 38.1(b)(1) through (4) and (b)(12), to 

read as follows: 

§ 38.1 Incorporation by reference of North 

American Energy Standards Board 

Wholesale Electric Quadrant standards. 

* * * * * 

(b) * * * 


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