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5188 Federal Register / Vol. 71, No. 21 / Wednesday, February 1, 2006 / Proposed Rules 

small or large spearmint oil producers 

and handlers. As with all Federal 

marketing order programs, reports and 

forms are periodically reviewed to 

reduce information requirements and 

duplication by industry and public 

sector agencies. 

AMS is committed to compliance 

with the Government Paperwork 

Elimination Act (GPEA), which requires 

Government agencies in general to 

provide the public the option of 

submitting information or transacting 

business electronically to the maximum 

extent possible. 

USDA has not identified any relevant 

Federal rules that duplicate, overlap, or 

conflict with this rule. 

In addition, the Committee’s meeting 

was widely publicized throughout the 

spearmint oil industry and all interested 

persons were invited to attend the 

meeting and participate in Committee 

deliberations on all issues. Like all 

Committee meetings, the October 5, 

2005, meeting was a public meeting and 

all entities, both large and small, were 

able to express views on this issue. 

Finally, interested persons are invited to 

submit information on the regulatory 

and informational impacts of this action 

on small businesses. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at: http://www.ams.usda.gov/ 

fv/moab.html. Any questions about the 

compliance guide should be sent to Jay 

Guerber at the previously mentioned 

address in the FOR FURTHER INFORMATION 

CONTACT section. 

A 30-day comment period is provided 

to allow interested persons the 

opportunity to respond to this proposal. 

This comment period is deemed 

appropriate so that a final determination 

can be made prior to June 1, 2006, the 

beginning of the 2006–2007 marketing 

year. All written comments timely 

received will be considered before a 

final determination is made on this 

matter. 

List of Subjects in 7 CFR Part 985 

Marketing agreements, Oils and fats, 

Reporting and recordkeeping 

requirements, Spearmint oil. 

For the reasons set forth in the 

preamble, 7 CFR Part 985 is proposed to 

be amended as follows: 

PART 985—MARKETING ORDER 

REGULATING THE HANDLING OF 

SPEARMINT OIL PRODUCED IN THE 

FAR WEST 

1. The authority citation for 7 CFR 

Part 985 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

2. A new § 985.225 is added to read 

as follows: 

[Note: This section will not appear in the 

Code of Federal Regulations.] 

§ 985.225 Salable quantities and allotment 

percentages—2006–2007 marketing year. 

The salable quantity and allotment 

percentage for each class of spearmint 

oil during the marketing year beginning 

on June 1, 2006, shall be as follows: 

(a) Class 1 (Scotch) oil—a salable 

quantity of 878,205 pounds and an 

allotment percentage of 45 percent. 

(b) Class 3 (Native) oil—a salable 

quantity of 1,007,886 pounds and an 

allotment percentage of 46 percent. 

Dated: January 27, 2006. 

Lloyd C. Day, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 06–948 Filed 1–30–06; 9:06 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 158 

[Docket No. FAA–2006–23730; Notice No. 

06–01] 

RIN 2120–AI68 

Passenger Facility Charge Program, 

Debt Service, Air Carrier Bankruptcy, 

and Miscellaneous Changes 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 


ACTION: Notice of proposed rulemaking 


(NPRM). 


SUMMARY: This action proposes to 

change the passenger facility charge 

program to add more eligible uses for 

revenue, protect such revenue in 

bankruptcy proceedings, and eliminate 

charges to passengers on military 

charters. These proposed actions 

respond to the Vision 100—Century of 

Aviation Reauthorization Act. In 

addition, the proposed action would 

revise current reporting requirements to 

reflect technological improvements; 

incorporate some existing practices and 

policies into current regulations; and 

clarify and update existing references 

and regulations. This proposal would 

further streamline the existing policies 

of the passenger facility charge program. 

DATES: Send your comments on or 

before April 3, 2006. 


ADDRESSES: You may send comments 


[identified by Docket Number FAA–


2006–23730] using any of the following 


methods: 


• DOT Docket Web site: Go to 

http://dms.dot.gov and follow the 

instructions for sending your comments 

electronically. 

• Government-wide rulemaking Web 

site: Go to http://www.regulations.gov 

and follow the instructions for sending 

your comments electronically. 

• Mail: Docket Management Facility; 

U.S. Department of Transportation, 400 

Seventh Street, SW., Nassif Building, 

Room PL–401, Washington, DC 20590– 

0001. 

• Fax: 1–202–493–2251. 

• Hand Delivery: Room PL–401 on 

the plaza level of the Nassif Building, 

400 Seventh Street, SW., Washington, 

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

through Friday, except Federal holidays. 

For more information on the 

rulemaking process, see the 

SUPPLEMENTARY INFORMATION section of 

this document. 

Privacy: We will post all comments 

we receive, without change, to http:// 

dms.dot.gov, including any personal 

information you provide. For more 

information, see the Privacy Act 

discussion in the SUPPLEMENTARY 

INFORMATION section of this document. 

Docket: To read background 

documents or comments received, go to 

http://dms.dot.gov at any time or to 

Room PL–401 on the plaza level of the 

Nassif Building, 400 Seventh Street, 

SW., Washington, DC, between 9 a.m. 

and 5 p.m., Monday through Friday, 

except Federal holidays. 

FOR FURTHER INFORMATION CONTACT: 

Sheryl Scarborough, Airports Financial 

Analysis & Passenger Facility Charge 

Branch, APP–510, Federal Aviation 

Administration, 800 Independence 

Avenue, SW., Washington, DC 20591; 

telephone: (202) 267–8825; facsimile: 

(202) 267–5302; e-mail: 

sheryl.scarborough@faa.gov; or Beth 

Weir, Airports Law Branch, AGC–610, 

Federal Aviation Administration, 800 

Independence Avenue, SW., 

Washington, DC 20591, telephone (202) 

267–5880; facsimile: (202) 267–5769. 

SUPPLEMENTARY INFORMATION: 

Comments Invited 

The FAA invites interested persons to 

join in this rulemaking by filing written 

comments, data, or views. We also 

invite comments about 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. 

We ask that you send us two copies of 

written comments. 

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Federal Register / Vol. 71, No. 21 / Wednesday, February 1, 2006 / Proposed Rules 5189 

We will file in the docket all 

comments we receive, as well as a 

report summarizing each substantive 

public contact with FAA personnel 

about this proposed rulemaking. The 

docket is available for public inspection 

before and after the comment closing 

date. If you wish to review the docket 

in person, go to the address in the 

ADDRESSES section of this preamble 

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

through Friday, except Federal holidays. 

You may also review the docket using 

the Internet at the Web address in the 

ADDRESSES section. 

Privacy Act: Using the search function 

of our docket Web site, anyone can find 

and read the comments received into 

any of our dockets. This includes the 

name of the individual sending the 

comment (or signing the comment for an 

association, business, labor union). You 

may review DOT’s complete Privacy Act 

Statement in the Federal Register 

published on April 11, 2000 (65 FR 

19477–78) or you may visit http:// 

dms.dot.gov. 

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 late if it is possible to do so 

without incurring expense or delay. We 

may change this proposal because of the 

comments we receive. 

If you want the FAA to acknowledge 

receipt of your comments on this 

proposal, include with your comments 

a preaddressed, stamped postcard on 

which the docket number appears. We 

will stamp the date on the postcard and 

mail it to you. 

Proprietary or Confidential Business 

Information 

Do not file in the docket information 

that you consider to be proprietary or 

confidential business information. Send 

or deliver this information directly to 

the person identified in the FOR FURTHER 

INFORMATION CONTACT section of this 

document. You must mark the 

information that you consider 

proprietary or confidential. If you send 

the information on a disk or CD ROM, 

mark the outside of the disk or CD ROM 

and also identify electronically within 

the disk or CD ROM the specific 

information that is proprietary or 

confidential. 

Under 14 CFR 11.35(b), when we are 

aware of proprietary information filed 

with a comment, we do not place it in 

the docket. We hold it in a separate file 

to which the public does not have 

access, and place a note in the docket 

that we have received it. If we receive 

a request to examine or copy this 

information, we treat it as any other 

request under the Freedom of 

Information Act (5 U.S.C. 552). We 

process such a request under the DOT 

procedures found in 49 CFR part 7. 

Availability of Rulemaking Documents 

You can get an electronic copy using 

the Internet by: 

(1) Searching the Department of 

Transportation’s electronic Docket 

Management System (DMS) Web page 

(http://dms.dot.gov/search); 

(2) Visiting the FAA’s Regulations and 

Policies Web page at http:// 

www.faa.gov/regulations_policies; or 

(3) Accessing the Government 

Printing Office’s Web page at http:// 

www.access.gpo.gov/su_docs/aces/ 

aces140.html. 

You can also get a copy by sending a 

request to the Federal Aviation 

Administration, Office of Rulemaking, 

ARM–1, 800 Independence Avenue, 

SW., Washington, DC 20591, or by 

calling (202) 267–9680. Make sure to 

identify the docket number, notice 

number, or amendment number of this 

rulemaking. 

Authority for This Rulemaking 

The FAA’s authority to issue rules 

regarding aviation safety is found in 

Title 49 of the United States Code. 

Subtitle I, section 106 describes the 

authority of the FAA Administrator. 

Subtitle VII, Aviation Programs, 

describes in more detail the scope of the 

agency’s authority. 

This rulemaking is promulgated 

under the authority described in subtitle 

VII, part A, subpart I, section 40117. 

Under that section, the FAA, by 

delegation, is charged with prescribing 

regulations to impose a passenger 

facility fee to finance an eligible airportrelated project. This regulation is within 

the scope of that authority because 

Vision 100 requires the FAA to change 

the PFC program. Many proposals in 

this document are taken from Vision 

100. 

Background 

On March 23, 2005, the FAA 

published a final rule (2005 final rule) 

to create a 3-year pilot program for nonhub airports to test new application and 

application approval procedures for the 

passenger facility charge (PFC) program 

(70 FR 14928). The final rule contains 

several changes designed to streamline 

the PFC application and amendment 

procedures for all PFC applications and 

amendments to improve the entire PFC 

program. 

The FAA published the 2005 final 

rule to address Congressional mandates 

in the Vision 100—Century of Aviation 

Reauthorization Act (Vision 100). The 

non-hub pilot program, with the PFC 

application streamlining procedures, 

however, was only one of six mandates 

specified in Vision 100. The FAA 

separated the non-hub program and 

related changes from the other mandates 

because Congress had required the FAA 

to publish proposed rules on the pilot 

program within 180 days of enactment 

of Vision 100. 

This rulemaking addresses the 

remaining mandates in Vision 100. 

These mandates include: 

(1) Making low-emission airport 

vehicles and ground support equipment 

eligible for PFC funding, 

(2) Using PFCs to pay debt service on 

projects that are ‘‘not an eligible airportrelated project’’ when there is a 

financial need at an airport, 

(3) Clarifying the PFC status of 

military charters, 

(4) Structuring PFC account 

requirements for carriers in bankruptcy, 

and 

(5) Making eligible the use of PFC 

revenue as local share for projects under 

the air traffic modernization costsharing program. 

In addition, the FAA is proposing 

other changes, two of which would 

streamline benefits beyond those 

contained in the 2005 final rule. These 

proposed changes would: 

(1) Provide for the electronic filing of 

notices and reports; 

(2) Provide a process for periodic 

review and change of the carrier 

compensation level; and 

(3) Modify the content and due date 

for some public agency reports and 

notices. 

Discussion of the Proposals 

The NPRM is divided into three parts: 

(1) Changes mandated by Vision 100; 

(2) Changes associated with 

technological improvements; and 

(3) Changes to streamline PFC 

procedures, codify PFC policies, or 

address issues or questions about the 

PFC program. 

Changes Mandated by Vision 100 

Low-Emission Airport Vehicles and 

Ground Support Equipment 

Section 121 of Vision 100 establishes 

a voluntary program to reduce airport 

ground emissions at commercial service 

airports in air quality nonattainment 

and maintenance areas (49 U.S.C. 

40117(a)(3) and (b)(5)). This program 

makes the cost of new or converted 

equipment or vehicles eligible for PFC 

funding. The intent of the program is 

not to cause the premature retirement of 

existing equipment or vehicles, but to 

provide incentives to buy replacements 

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or to convert existing equipment to meet 

lower emissions standards. The program 

helps airports meet their obligations 

under the Clean Air Act (42 U.S.C. 

7501(2)) and helps regional efforts to 

meet health-based National Ambient Air 

Quality Standards. The program goal is 

to reduce the amount of regulated 

pollutants and other harmful air 

emissions produced by ground 

transportation sources at airports. The 

program also supports efforts to increase 

U.S. energy independence by 

emphasizing domestically produced 

alternative fuels that are substantially 

nonpetroleum based. The program 

provides public agencies with financial 

and regulatory incentives to increase 

their investment in proven lowemission technology. Use of alternative 

fuel vehicles and other low-emission 

technologies that are particularly suited 

to the airport environment are highly 

encouraged. 

To address Vision 100, the proposed 

rule would add the definition of 

‘‘ground support equipment’’ to § 158.3. 

Ground support equipment includes 

vehicles used for operations and 

maintenance of aeronautical activities, 

but does not include vehicles used to 

meet safety, security, and snow removal 

requirements. Baggage tugs, belt loaders, 

cargo loaders, forklifts, fuel trucks, 

lavatory trucks, and pushback tractors 

are among the types of vehicles that fit 

the definition of ground support 

equipment. In addition, battery 

recharging and alternate fueling stations 

are eligible under this program. 

The low-emission vehicle program 

provides a funding mechanism to 

acquire low-emission technology, which 

often is more costly than conventional 

technology. The proposed rule would 

modify § 158.13 by setting the 

maximum allowable cost for certain 

low-emission technology projects. For 

new vehicle purchases, public agencies 

may only use PFC revenue for the added 

cost of the low emission technology 

above the cost of a conventional 

emission vehicle. For vehicles being 

converted to low-emission technology, 

public agencies may only use PFC 

revenue for the reasonable cost of the 

conversion. 

The proposal would add paragraph 

(b)(8) to § 158.15 to provide the 

eligibility requirements for lowemission vehicle projects. To be eligible, 

the airport must be located in an FAA 

and Environmental Protection Agency 

designated air quality nonattainment or 

maintenance area. In addition, the 

airport must receive emission credits for 

completing the project from the 

appropriate State air quality agency. 

Eligible projects must either (1) 

convert existing vehicles powered by 

diesel or gasoline engines to lowemission technology or the use of 

cleaner burning fuels, or (2) buy new 

vehicles that include low-emission 

technology or use cleaner burning fuels. 

Interested parties are directed to the 

following Web site to obtain guidance 

on determining the eligibility of projects 

and how benefits to air quality must be 

demonstrated: http://www.faa.gov/arp/ 

environmental/VALE/Index.cfm. 

Use of Fees To Pay Debt Service 

Section 122 of Vision 100 amended 

the statute to permit an exception to use 

PFC revenue to pay the debt service 

costs of airport-related projects that 

otherwise are not PFC-eligible if the 

public agency can show a financial need 

(49 U.S.C. 40117(b)(6)). The FAA 

expects that a public agency seeking 

relief under this provision wants to 

restore its financial stability and health. 

A proposed new definition, ‘‘Financial 

need,’’ would be added to § 158.3. This 

definition would tie the financial need 

of a public agency to its ability to meet 

operational and debt obligations and 

maintain at least a 2-month reserve 

fund. Such financial need typically 

results from a series of events that 

cumulatively weaken the financial 

condition of the public agency. The 

FAA defines ‘‘financial need’’ based on 

information collected from several 

airports regarding their capital reserve 

funds and broadly accepted principles 

of airport financial fitness. 

Proposed paragraph (e) to § 158.13 

would provide an exception permitting 

the use of PFC revenue to pay debt 

service costs for a noneligible project. 

Proposed new § 158.18 would provide 

for the use of PFC revenue to pay debt 

service cost for noneligible projects. 

Financial need is based on severe 

financial constraints suffered by the 

airport or public agency. This adverse 

financial position usually results from 

one or more events beyond the 

reasonable control of the public agency, 

resulting in a financial crisis for the 

airport. These events may include: 

(1) The bankruptcy of an air carrier 

serving the airport that results in 

rejecting leases for a significant portion 

of all air carrier gates at that airport; 

(2) Significantly reduced service by 

one or more air carriers that accounts for 

a major portion of the enplaned 

passenger traffic at the airport; or 

(3) Other dramatic changes in air 

carrier service patterns that undermine 

the ability of the public agency to pay 

for airport development already 

constructed. 

Other events, such as natural 

disasters, may also create a financial 

need for the public agency. 

A public agency should show that its 

financial recovery plan makes use of all 

available resources. The FAA would 

authorize an airport or public agency to 

impose a PFC under this paragraph only 

for the period necessary to cure the 

airport’s or agency’s financial need. 

Furthermore, the FAA expects the 

public agency to use any revenue saved 

by this PFC to return the airport to a 

state of financial fitness in as quick a 

period as possible. For example, use of 

the saved revenue to incur additional 

non-aeronautical debt or development 

costs would not return the airport to a 

state of financial fitness. 

A public agency applying for PFC 

revenue under this provision must use 

the application procedures in § 158.25 

and document its financial position by 

providing information regarding: 

(1) A change in passenger 

enplanements for a carrier; 

(2) Negative actions taken on the 

public agency’s bond rating; 

(3) The inability of the public agency 

to meet bond payments and associated 

requirements; 

(4) Alternative sources of revenue 

available to the public agency, such as 

grant funds, state funds, concession 

revenue, vehicle parking fees, aircraft 

parking fees, other non-aviation fees, 

fuel taxes, and revenue from any other 

operators using the airport. (The 

submitted information must address 

whether these fees can be raised to 

create more revenue for the airport); 

(5) The impact of any necessary 

increases to the rate base or landing fees 

for concession and carrier revenue 

because of the loss of revenue from a 

change in economic circumstances (e.g., 

the bankruptcy or financial troubles of 

a carrier); 

(6) Actions taken by the public agency 

to reduce cost, such as operational 

changes, personnel actions, or capital 

project postponement; 

(7) The source(s) of revenue currently 

used to pay bond cost; 

(8) The current airport fee structure 

and methodology used to calculate rates 

and charges; 

(9) The affect of the loss of an air 

carrier or adding a new carrier on the 

current fee structure; 

(10) The planned use of revenue 

saved by using PFCs to pay the debt 

service and how this use will aid the 

return to financial fitness; and 

(11) Any other information the public 

agency believes will document the 

financial need of the airport. 

The FAA will use the procedures in 

§ 158.27 to analyze the information 

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submitted by the public agency, and 

then issue its decision on a case-by-case 

basis under § 158.29. 

Clarification of Applicability of PFCs to 

Military Charters 

Section 123(c) of Vision 100 amended 

the PFC statute to prohibit collecting 

PFCs from passengers on military 

charter flights (49 U.S.C. 400117(e)(2)). 

Proposed paragraph (a) (6) to § 158.9 

would clarify that passengers who do 

not pay directly for the air 

transportation due to Department of 

Defense charter arrangements or 

payments will not pay PFCs. 

Financial Management of Passenger 

Facility Fees 

Section 124 of Vision 100 added 

specific requirements to protect PFC 

revenue from creditors when air carriers 

file for bankruptcy protection after the 

date of enactment of Vision 100 (49 

U.S.C. 40117 (m) (1–7)). Through this 

provision, Congress has specifically 

recognized and protected the trust fund 

status of PFC revenue and prohibited air 

carriers from using PFCs as security 

with third parties. 

Air carriers historically have 

commingled PFC revenue in accounts 

with other revenue until it was time to 

remit the PFC revenue to the various 

public agencies. Before Vision 100, in 

situations where an air carrier filed for 

bankruptcy protection and owed PFC 

remittances, public agencies had 

difficulties recovering past due PFCs. In 

part, these difficulties arose because the 

PFC revenue was commingled and, 

thus, difficult for bankruptcy courts to 

identify and public agencies to recover. 

Section 124 prohibits the commingling 

of PFC revenue with other revenue for 

air carriers in bankruptcy. In addition, 

section 124 requires that air carriers in 

bankruptcy set up separate PFC 

accounts to handle PFC transactions— 

receipt of revenue from passengers and 

issuance of remittance to public 

agencies. This provision should enable 

bankruptcy courts to more easily 

identify PFC revenue for remittance to 

public agencies. 

The proposed rule would add a 

definition of ‘‘covered air carrier’’ to 

§ 158.3. The new definition states that a 

covered air carrier is an air carrier that 

has filed for bankruptcy protection or 

has had an involuntary proceeding 

started against it after December 12, 

2003. 

In addition, the proposed rule would 

modify paragraph (b) of § 158.49, which 

allows air carriers to commingle PFC 

revenue with an air carrier’s other 

sources of revenue, so that this 

paragraph does not apply to covered air 

carriers. 

A new paragraph (c) would be added 

to § 158.49 requiring a covered air 

carrier segregate the PFC revenue into a 

designated PFC account when it enters 

bankruptcy protection. A covered air 

carrier would be required to set up the 

PFC account dedicated solely to PFCs, 

with a deposit equal to the average 

month’s balance, based on the air 

carrier’s past 12 months of PFC 

collections net of any credits or 

handling fees allowed by law. A covered 

air carrier would be required to ensure 

the account balance never falls below 

this initial fixed deposit amount (‘‘PFC 

Reserve’’). Besides the method proposed 

in this rulemaking, the FAA considered 

requiring the covered air carrier to keep 

a rolling balance in the designated PFC 

account. This rolling balance was based 

on an average of the previous 12 

month’s collections recalculated 

monthly as a method to calculate an 

amount that would be a fair account 

balance. The monthly recalculation 

would have captured situations where 

an airport served by the air carrier 

started PFC collections or increased its 

level of PFC collections after the PFC 

account was established. However, the 

FAA eventually concluded that 

recalculation on a rolling basis would be 

too burdensome on the covered air 

carrier and difficult for the FAA and the 

public agencies to monitor. 

The FAA recognizes that a covered air 

carrier may change its route structure 

during its bankruptcy and this change in 

route structure may, in turn, effect the 

average PFCs collected. Therefore, 

under the proposal a covered air carrier 

would be permitted to recalculate and 

reset the PFC Reserve and daily PFC 

amount on each successive anniversary 

date of its bankruptcy petition. 

Proposed paragraph (c) to § 158.49 

would allow a covered air carrier to 

deposit ticket sales revenue to its 

general operating account before 

separating the types of revenue. The 

proposal requires the covered air carrier 

to sweep its general operating account at 

least once a business day to take the 

PFC revenue initially deposited in this 

account and redeposit it in the PFC 

account. Through recent experience, the 

FAA has discovered that not all covered 

air carriers can judge the PFC 

collections on a daily basis. 

Accordingly, under the proposal, a 

covered air carrier that cannot 

accurately move the PFC revenue daily 

may elect to deposit into the PFC 

account daily, an estimated amount 

based on 1/30th of the PFC Reserve 

balance. A covered air carrier that 

sweeps with the estimated amount will 

be required to reconcile the PFC account 

for accuracy no later than the 20th of 

each month. This provision allows the 

covered air carrier to have an accurate 

PFC balance in place at the time of 

required PFC remittances. 

The proposed paragraph reiterates 

Congress’ mandate to protect the trust 

fund status of PFC revenue. Even if the 

covered air carrier fails to follow the 

procedures in this paragraph, this trust 

fund status shall not be defeated by an 

inability of any party to identify and 

trace precise amounts of PFC revenue in 

the air carrier’s accounts. The proposed 

paragraph also prohibits a covered air 

carrier and its agents from granting a 

security or other interest in the PFC 

revenue to a third party. 

Proposed paragraph (c) also provides 

that, if a public agency is forced to incur 

costs to recover PFC revenue because 

the covered air carrier failed to comply 

with these new PFC revenue-handling 

procedures, the covered air carrier is 

required to compensate the public 

agency for its costs. This provision 

applies to costs incurred by a public 

agency in pursuit of PFCs owed if a 

covered air carrier fails to make its PFC 

payments under the statute or rule (49 

U.S.C. 40117(m)(4). 

Proposed paragraph (b) to § 158.53 

would state that a covered air carrier is 

entitled to keep the interest portion of 

the compensation only as long as the air 

carrier follows the procedures in 

§ 158.49. 

Proposed paragraph (b) to § 158.65 

would require that, besides reporting to 

the public agencies, covered air carriers 

must send a copy of their quarterly 

report to the FAA. Covered air carriers 

also will be required to send a PFC 

account statement to the FAA on the 

fifth day of the month. The account 

statement will include the balance of 

their PFC account, the balance of their 

PFC reserve amount, total PFC funds 

deposited, and total PFC funds 

dispersed. This monthly report allows 

the FAA to monitor the covered air 

carrier’s compliance with the 

requirements of § 158.49. The monthly 

report must continue while a covered 

air carrier remains in a bankruptcy 

proceeding. 

Cost Sharing of Air Traffic 

Modernization Projects 

Section 183 of Vision 100 set up a 

program to allow cost sharing of air 

traffic modernization projects (49 U.S.C. 

44517(a)). This program is intended to 

improve aviation safety and the mobility 

of the Nation’s air transportation system 

by encouraging non-Federal investment 

in critical air traffic control equipment 

and software. Under this program the 

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FAA may make grants to eligible 

sponsors to pay a portion of the cost of 

FAA-approved projects to procure and 

install air traffic facilities and 

equipment. The program is intended to 

allow sponsors to achieve accelerated 

deployment of eligible facilities and 

equipment and to help expand aviation 

infrastructure. The sponsor may fund 

the non-Federal portion of the project 

costs through various methods 

including the use of PFC revenue. 

If a public agency wishes to use PFC 

revenue to pay for all or a portion of the 

non-Federal share of the project, the 

public agency must first obtain 

authority to impose a PFC and use PFC 

revenue under the procedures in 

§§ 158.25 or .30. 

Currently, paragraph (d) of § 158.13 

allows the use of PFC revenue to pay for 

the non-Federal share of costs for a 

project funded under the Federal airport 

grant program. This paragraph will be 

renumbered as paragraph (g) and 

expanded to include the FAA’s 

‘‘program to permit cost-sharing of air 

traffic modernization projects.’’ 

A new proposed paragraph (8) to 

§ 158.15(b) would list a project 

approved under the FAA’s program to 

allow cost sharing of air traffic 

modernization projects as PFC-eligible. 

Changes Because of Technological 

Improvements 

Major examples of technological 

improvements since the PFC program 

inception in 1990 are the use of 

electronic or paperless airline ticketing, 

the use of electronic mail to send 

documents, and web sites to post 

information. 

The existing procedures for collection 

of PFCs from passengers were 

developed based on the assumption that 

ticket issuance would require a physical 

transaction, including the issuance of a 

paper airline ticket and a physical ticket 

issuance. Today, passengers can buy 

airline tickets using many methods, 

including the internet, and many air 

carriers no longer issue paper tickets. 

Furthermore, airline code-sharing and 

global alliances that have expanded 

ticketing options were not widely in 

place in 1990. 

Currently, carriers have several 

options for PFC collection if the ticket 

is issued outside the U.S., including 

non-collection of any PFCs if the carrier 

does not serve a point in the U.S. 

Furthermore, airline code-sharing and 

global alliances, which were not 

common in 1990, have grown and 

created the potential for mistakenly 

administered and mishandled PFCs. A 

person living in the United States may 

buy airline tickets for domestic travel 

over the internet from a foreign carrier. 

Such transactions may confuse foreign 

carriers, especially those who do not 

have significant operations in the U.S., 

when determining the proper 

procedures to follow. To address these 

issues, the FAA is proposing several 

changes to part 158. 

The proposal would define the ‘‘point 

of issuance of airline tickets’’ in § 158.3 

to include electronic and other ticketing 

mediums. The definition of ‘‘air travel 

ticket’’ would be expanded to bring the 

definition in line with the varying 

methods of ticketing, including 

electronic records, boarding passes, and 

any other ticketing medium. In 

reference to a passenger’s itinerary, the 

word ‘‘complete’’ would be removed 

since today’s passengers may obtain 

documents, including a receipt showing 

the PFCs paid on each leg of their 

itinerary. 

Proposed paragraph (a) of § 158.47 

would clarify that U.S. and foreign air 

carriers must follow the requirements of 

§ 158.45 when the itinerary is for travel 

within the U.S. regardless of the 

location of the ticket issuance. 

The second technological 

improvement addressed by this 

proposal is the submission of 

information. Current air carrier 

quarterly reporting requirements in part 

158 provide public agencies with 

information about PFC revenue remitted 

to the public agency, refunded to 

passengers, and retained by the air 

carrier. Air carrier quarterly reports 

allow public agencies to monitor their 

collections and identify any 

discrepancies in a timely manner. 

The FAA has developed a national 

PFC database that stores information on 

PFC application and project approvals. 

Before issuing a final rule, the FAA 

expects to develop modules to collect 

the same types of information directly 

from the public agencies and air carriers 

for quarterly reports. 

A comment submitted to the NPRM 

that was the basis of the 2005 final rule 

suggested the FAA eliminate the 

monthly and quarterly reports filed by 

air carriers to public agencies and, 

instead, create an air carrier annual 

report with currently required 

information. Since this comment was 

outside the scope of that notice, the 

FAA stated that it would consider the 

comment for inclusion in a future 

rulemaking. 

Part 158 includes an air carrier 

reporting requirement to provide public 

agencies with information about the 

amount of PFC revenue remitted to the 

public agency, refunded to passengers, 

and retained by the carrier. The FAA 

determined that a quarterly report 

allows public agencies to monitor their 

collections and identify any 

discrepancies in a timely manner. 

Paragraph (a) of proposed § 158.20 

would permit public agencies and air 

carriers to send required documents 

such as letters, reports, and 

certifications of agreement/disagreement 

by e-mail, facsimile, courier, or regular 

mail. Paragraph (b) provides that public 

agencies and air carriers may use the 

PFC national database to post their 

quarterly reports. Thus, the FAA will 

not require public agencies and air 

carriers using this database to use U.S. 

Postal Services to send their quarterly 

reports to interested parties. 

To accommodate the interests of as 

many public agencies as possible, the 

FAA will maintain the requirement in 

§ 158.65 that the air carriers provide 

quarterly reports or input into the 

national PFC database. A public agency 

will be able to view these reports any 

time. 

Changes To Streamline PFC 

Procedures, Codify PFC Policies, or 

Address Issues or Questions About the 

PFC Program 

As the PFC program has developed, 

the FAA has recognized the need to 

streamline its existing policies. The 

discussions below identify certain areas 

where we are proposing changes to the 

current rule. Section 158.3 would 

redefine or add several definitions for 

terms currently in use. The first two 

definition changes result from new 

terms introduced with the nonhub 

program. The third new definition 

claries existing FAA policy. 

• ‘‘Approved project’’ would be 

revised to ensure that projects 

acknowledged under the non-hub 

program are included in the definition. 

Under the non-hub program, the FAA 

‘‘acknowledges’’ the notice of intent and 

the projects contained therein. However, 

there are many sections of part 158 that 

are applicable to projects being financed 

with PFC revenue and, thus, are 

applicable to both approved and 

acknowledged projects. 

• ‘‘Notice of intent (to impose a PFC 

or use PFC revenue)’’ is a term used in 

the non-hub PFC authorization 

procedures. Public agencies receiving 

PFC authorization under the non-hub 

procedures must comply with all rules 

of the PFC program outside the 

authorization procedures in § 158.25. 

PFC authorizations for these other 

applications are identified as PFC 

applications and part 158 makes many 

references to ‘‘PFC application’’ or just 

‘‘application.’’ Rather than adding the 

term ‘‘notice of intent’’ at every location 

where the term ‘‘application’’ is used, 

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the FAA is proposing to add a definition 

of ‘‘notice of intent.’’ The proposed 

definition would include a statement to 

clarify that, except for those sections of 

part 158 that deal with specific 

authorization procedures, the terms 

‘‘notice of intent’’ and ‘‘application’’ 

should be used interchangeably. 

• The FAA has been approving 

collection of PFC revenue to pay for a 

public agency’s cost of administering its 

PFC program based on the existing 

definition of the allowable costs in part 

158. However, part 158 does not include 

a definition of the types of costs covered 

under PFC administrative support costs. 

Adding a definition for ‘‘PFC 

administrative support costs’’ would 

clarify the types of costs that public 

agencies should identify as PFC 

administrative support costs. 

About 10 years ago, the FAA adopted 

a policy of advising public agencies to 

apply for PFC administrative support 

costs as a separate project. This policy 

has allowed the FAA to monitor more 

closely the public agency’s costs and 

review the scope of work. However, not 

all public agencies have complied with 

this policy. Some public agencies 

include their administrative support 

costs within their development projects, 

resulting in inaccurate cost estimates for 

both the development projects and the 

administrative costs. The proposed rule 

would add paragraph (b) to § 158.13 

providing that public agencies may use 

PFC revenue to pay for allowable PFC 

administrative support costs. The new 

paragraph would direct that public 

agencies treat PFC administrative 

support costs as a separate and distinct 

PFC project in a PFC application or 

notice of intent. 

The PFC program is available to 

States, territories, Commonwealths, and 

possessions of the United States. 

Initially, the Trust Territory of the 

Pacific Islands was a territory of the U.S. 

and, thus, was eligible to participate in 

the PFC program. The Compact of Free 

Association between the U.S., Marshall 

Islands, and Federated States of 

Micronesia provided that newly 

independent States would be eligible to 

participate in Federal programs, such as 

the PFC program, for 15 years after 

adopting the Compact. The 15-year 

period ended in 2001, and the Marshall 

Islands and Federated States of 

Micronesia are no longer eligible to 

participate in the PFC program. 

Therefore, the definition for ‘‘State’’ 

would be redefined to remove the Trust 

Territory of the Pacific Islands. 

This proposal changes the current 

title of § 158.30 to ‘‘PFC Authorization 

at Non-Hub Airports.’’ This proposed 

change clarifies that PFC authorizations 

at non-hub airports relate to size of 

airport and not to aircraft pilots at nonhub airports. The sunset provision in 

paragraph (h) remains in effect (49 

U.S.C. 40117(l)(7)). 

The proposed editorial changes in 

§ 158.31 clarify the intent of the original 

language. 

Proposed paragraphs (a)(2), (c)(1), and 

(c)(2) of § 158.33 would clarify the term 

‘‘charge effective date.’’ A public agency 

may only collect on one PFC decision at 

a time meaning the charge effective date 

for a subsequent application must be on 

or after the charge expiration date for 

the current application. 

The FAA wrote § 158.33 to require 

public agencies to take certain actions 

within a prescribed period of time after 

the charge effective date of an 

application. However, a literal reading 

of the current regulation could lead to 

the belief that, for example, a project 

approved for collection in 2005 in an 

application with a charge effective date 

of 2016 need not be implemented for 11 

years. The FAA interprets the timelines 

in § 158.33 with regard to the start of 

collections for an application as being 

either the charge effective date or the 

date the application was approved. 

Section 158.37 requires a public 

agency to consult with air carriers and 

provide notice and the opportunity for 

public comment if the public agency is 

seeking to increase the PFC amount of 

a project by more than 25 percent of the 

originally approved amount. While the 

FAA believes the 25 percent threshold 

is reasonable, an excess of amendments 

could overburden the consultation and 

comment processes, requiring 

consultation for insignificant amounts. 

For example, the FAA has approved 

several projects for amounts of $1,000 or 

less. Under the current rules, an 

increase of $250 to a $1,000 project 

would trigger the need for consultation 

and public comment. 

The FAA examined the existing 

universe of PFC projects and concluded 

that over 75 percent of these projects 

have a PFC cost below $1 million. 

Generally, these projects have wellestablished costs. Increases are often 

sought because of changes in quantities 

or differences in estimated or actual 

costs. Furthermore, the FAA rarely 

receives substantive comments from air 

carriers or the public on projects with 

PFC costs below $1 million. This 

proposed rule would modify § 158.37 to 

provide a minimum dollar threshold. 

For projects with originally approved 

amounts at or above this threshold, an 

increase of more than 25 percent would 

trigger the need for consultation and 

public comment. For projects with 

originally approved amounts below this 

threshold, public agencies will not need 

to consult with air carriers and provide 

the opportunity for public comment, 

regardless of the percentage increase in 

costs proposed. Paragraphs (b)(1)(i)(A), 

(b)(1)(ii)(C), (b)(1)(ii)(D), and (b)(5) 

would be modified to address this 

proposed threshold. 

This proposed rule would clarify the 

language in paragraph (a) of § 158.39 by 

adding ‘‘earned thereon’’ after ‘‘ *** 

plus interest.’’ A public agency must 

include the PFC principal and the 

interest earned thereon in determining 

whether it has collected the total 

amount of PFC revenue authorized. 

Proposed paragraph (d) of § 158.39 

would delete ‘‘under § 158.25(c)’’ from 

the second sentence. As discussed 

earlier in the notice of intent definition, 

‘‘notice of intent’’ may be used 

interchangeably with ‘‘PFC 

application.’’ 

Currently, paragraph (b)(3) of § 158.43 

requires a public agency to set its charge 

effective date as the first day of a month 

at least 60 days from the date the notice 

was sent to air carriers. Since its 

beginning, however, air carriers have 

developed procedures for programming 

new PFC collections at airports and are 

able to perform this programming in 30 

days. This proposal would change the 

requirement to 30 days in paragraph 

(b)(3) of § 158.43. 

Current FAA policy requires at least 

30 days notice to allow air carriers 

enough time to reprogram their systems. 

However, public agencies continue to 

make changes with less than 30 days 

notice. Occasionally, this results in the 

FAA not processing the change and the 

public agency’s collection is either 

prematurely stopped or extended a 

month beyond the intended expiration 

date. The proposed rule would modify 

paragraph (c) of § 158.43 to require that 

public agencies notify air carriers and 

the FAA at least 30 days before 

changing the charge expiration date. 

The proposed rule would modify 

paragraphs (a)(3) of § 158.45 and (c)(4) 

of § 158.47 to clarify that failure to 

travel on a nonrefundable or expired 

airline ticket is not a change in itinerary. 

Ticket purchasers holding 

nonrefundable or expired tickets are not 

entitled to a refund of any associated 

PFCs if the ticket purchaser is not 

entitled to any fare refund. 

The PFC statute requires the FAA set 

up a uniform collection compensation 

amount reflecting the ‘‘average 

reasonable and necessary expenses’’ of 

the air carriers’ collection and handling 

of the PFC (49 U.S.C. 40117 (i)(2)(C)). A 

periodic review of the collection 

compensation rate is fair and reasonable 

because of changing air carrier PFC 

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handling costs. The costs may include 

handling, reporting, escrow, collecting, 

and remittance fees. The proposed rule 

would provide for periodic review 

outside the formal rulemaking process. 

In the future, the FAA plans 

periodically to publish a notice in the 

Federal Register asking that air carriers 

voluntarily provide data on their costs 

associated with the PFC program. 

Proposed paragraph (c) of § 158.53 

would include a list of the 11 categories 

of cost data the FAA tentatively has 

determined represent the incremental 

costs directly associated with PFC 

collection, handling, remittance, 

reporting, recording keeping, and 

auditing by air carriers. If the FAA 

determines a new level is warranted, we 

would publish a second Federal 

Register notice seeking public comment. 

We would publish a third notice in the 

Federal Register providing a final 

determination. 

The FAA has developed its national 

PFC database and identified the need for 

national consistency in the information 

reported. This database allows public 

agencies to input the revenue received 

on either a monthly or quarterly basis. 

The FAA chose the actual revenue 

received method rather than accrual 

basis method because actual basis is 

more closely tied to when PFC 

collections are completed. This proposal 

would modify paragraph (a) of § 158.63 

to clarify that public agencies must 

report revenue actually received from 

the air carriers rather than on an accrual 

basis. 

Currently, large and medium hub 

airports are required to file their annual 

PFC revenue forecasts by August 1. The 

FAA set the August 1 date based on 

when it usually received its first 

estimates on airport enplanements and, 

thus, could make the first estimates on 

AIP apportionments for the upcoming 

fiscal year. The FAA streamlined its 

process for gathering enplanement data 

and now makes its AIP apportionment 

estimates about July 1. The proposal 

would modify paragraph (c) of § 158.63 

to specify July 1 as the date that large 

and medium hub airports report their 

forecast PFC revenue for the upcoming 

Federal fiscal year. 

This proposal would delete § 158.97, 

Special rule for transitioning airports, 

which expired at the end of Federal 

fiscal year 2004. 

Experience has shown that most PFC 

projects are physically completed long 

before they are financially completed. 

This contrasts with AIP grant projects 

where the financial completion of the 

project follows quickly after the 

project’s physical completion. This 

proposal would modify assurance 10 of 

part B of Appendix A to part 158 to add 

‘‘physical and financial’’ before 

‘‘completion’’ in the first sentence to 

clarify the time public agencies need to 

retain their records. 

The proposal would also update 

several authorization citations. 

Location 

Reference 

From To 

§ 158.67(c)(2) ..................................................... 

§ 158.81 ............................................................. 

Assurance 12 of part B of Appendix A ............. 

Single Agency Audit Act of 1984 (31 U.S.C. 

7501–7). 

Airport Noise and Capacity Act of 1990 .......... 

Airport Noise and Capacity Act of 1990 .......... 

Office of Management and Budget Circular A– 

133 (The Single Audit Act of 1984, P.L. 98– 

502, and the Single Audit Act Amendments 

of 1996, P.L. 104–156). 

49 U.S.C. 47523 through 47528. 

49 U.S.C. 47523 through 47528. 

Economic Assessment, Regulatory 

Flexibility Determination, Trade Impact 

Assessment, and Unfunded Mandates 

Assessment Economic Assessment 

Proposed changes to Federal 

regulations must undergo several 

economic analyses. First, Executive 

Order 12866 directs each Federal agency 

to propose or adopt a regulation only on 

a reasoned determination the benefits of 

the intended regulation justify its costs. 

Second, the Regulatory Flexibility Act 

of 1980 requires agencies to analyze the 

economic impact of regulatory changes 

on small entities. Third, the Trade 

Agreements Act prohibits agencies from 

setting standards that create 

unnecessary obstacles to the foreign 

commerce of the United States. In 

developing U.S. standards, the Trade 

Agreements Act also requires agencies 

to consider international standards and, 

where appropriate, use them as the basis 

of U.S. standards. Fourth, the Unfunded 

Mandates Reform Act of 1995 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.) 

In conducting these analyses, the FAA 

has determined this proposed rule (1) 

has benefits that justify its costs, is not 

a ‘‘significant regulatory action’’ as 

defined in section 3(f) of Executive 

Order 12866 and is not ‘‘significant’’ as 

defined in the DOT’s Regulatory 

Policies and Procedures; (2) would not 

have a significant economic impact on 

a substantial number of small entities; 

(3) would not have an effect on 

international trade; and (4) would not 

impose an unfunded mandate on State, 

local, or tribal governments, or on the 

private sector. These analyses, available 

in the preliminary regulatory evaluation 

supporting today’s rule, are summarized 

below. 

Costs of This Rulemaking 

Vision 100 mandates some changes to 

the PFC process that are not subject to 

the FAA’s discretion. Changes other 

than those prescribed by Vision 100 are 

discretionary and the costs and cost 

savings are estimated in the table below. 

Sector Costs Cost 

savings 

Net cost 

savings 

Present 

value 

Airports ............................................................................................................. 

Airlines ............................................................................................................. 

FAA .................................................................................................................. 

$17,100 

63,000 

971,500 

$1,638,600 

1,481,100 

235,900 

$1,621,500 

1,418,100 

(735,600) 

$1,138,300 

993,000 

(737,700) 

Total .......................................................................................................... 1,051,600 3,355,600 2,304,000 1,393,600 

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Regulatory Flexibility Assessment 

The Regulatory Flexibility Act of 1980 

(RFA) establishes ‘‘as a principle of 

regulatory issuance that agencies shall 

endeavor, consistent with the objective 

of the rule and of applicable statutes, to 

fit regulatory and informational 

requirements to the scale of the 

business, organizations, and 

governmental jurisdictions subject to 

regulation.’’ To achieve that principle, 

the RFA requires agencies to consider 

flexible regulatory proposals, to explain 

the rationale for their actions, and to 

solicit comments. The RFA covers a 

wide-range of small entities, including 

small businesses, not-for-profit 

organizations and small governmental 

jurisdictions. 

Agencies must perform a review to 

determine whether a rulemaking action 

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 Act. 

However, if an agency determines that 

a rulemaking action is not expected to 

have a significant economic impact on 

a substantial number of small entities, 

section 605(b) of the 1980 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 FAA believes that this proposal 

would not have a significant impact on 

a substantial number of entities. An 

airport operator (North American 

Industry Classification System (NAICS) 

488119) is classified as a small entity if 

it has annual revenues of $6 million or 

less. The average revenue for these 

airports was $1.7 million, and the 

median revenue was $1.1 million for 

2003. The entire cost to all airports is 

estimated to be $17,100. Thus, no small 

airport would experience a significant 

economic impact. A scheduled or 

nonscheduled passenger air carrier 

(NAICS 481111) is considered a small 

entity if it has 1,500 or fewer employees. 

The FAA has identified 57 air carriers 

with authorization to carry passengers 

that meet this classification. Small 

carriers that collect PFCs would not be 

adversely affected since any 

adjustments to modify ticketing or other 

administrative costs that small air 

carriers may incur as a result of this 

proposed rule are recoverable under the 

existing compensation provisions. 

Therefore, the FAA Administrator 

certifies 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 

prohibits Federal agencies from 

establishing any standards or engaging 

in related activities that create 

unnecessary obstacles to the foreign 

commerce of the United States. 

Legitimate domestic objectives, such as 

safety, are not considered unnecessary 

obstacles. The statute also requires 

consideration of international standards 

and, where appropriate, they be the 

basis for U.S. standards. Foreign carriers 

would be required to collect PFCs on 

wholly domestic U.S. travel that U.S. 

carriers are already required to collect, 

and the foreign carriers would be 

entitled to the same compensation 

provisions as U.S. carriers. The FAA has 

assessed the potential effect of this 

proposed rule and determined that it 

would impose the same costs on 

domestic and international entities and, 

thus, have a neutral trade impact. 

Unfunded Mandates Assessment 

The Unfunded Mandates Reform Act 

of 1995 (the Act) is intended, among 

other things to curb the practice of 

imposing unfunded Federal mandates 

on State, local, and tribal governments. 

Title II of the Act 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 (adjusted 

annually for inflation) 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 inflationadjusted value of $120.7 million in lieu 

of $100 million. This proposed rule 

does not contain such a mandate. 

Therefore, the requirements of Title II of 

the Unfunded Mandates Reform Act of 

1995 do not apply. 

Executive Order 13132, Federalism 

The FAA has analyzed this proposed 

rule under the principles and criteria of 

Executive Order 13132, Federalism. We 

determined that this action would not 

have a substantial direct effect on the 

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, and therefore 

would not have federalism implications. 

Paperwork Reduction Act 

This proposal contains the following 

new information collection 

requirements: Covered Air Carrier 

Monthly Escrow Account Report. In 

addition, the proposal contains changes 

in some existing public agency and air 

carrier reporting requirements. As 

required by the Paperwork Reduction 

Act of 1995 (44 U.S.C. 3507(d)), the 

FAA has submitted the information 

requirements associated with this 

proposal to the Office of Management 

and Budget for its review. 

Title: Passenger Facility Charge 

Program, Debt Service, Air Carrier 

Bankruptcy, and Miscellaneous Changes 

International Compatibility 

In keeping with U.S. obligations 

under the Convention on International 

Civil Aviation, it is FAA policy to 

comply with International Civil 

Aviation Organization (ICAO) Standards 

and Recommended Practices to the 

maximum extent practicable. The FAA 

has determined there are no ICAO 

Standards and Recommended Practices 

that match these proposed regulations. 

Plain English 

Executive Order 12866 (58 FR 51735, 

Oct. 4, 1993) requires each agency to 

write regulations that are simple and 

easy to understand. We invite your 

comments on how to make these 

proposed regulations easier to 

understand, including answers to 

questions such as the following: 

• Are the requirements in the 

proposed regulations clearly stated? 

• Do the proposed regulations contain 

unnecessary technical language or 

jargon that interferes with their clarity? 

• Would the regulations be easier to 

understand if they were divided into 

more (but shorter) sections? 

• Is the description in the preamble 

helpful in understanding the proposed 

regulations? 

Please send your comments to the 

address specified in the ADDRESSES 

section. 

Environmental Analysis 

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 proposed rulemaking 

action qualifies for the categorical 

exclusion identified in paragraph 3f and 

involves no extraordinary 

circumstances. 

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Regulations That Significantly Affect 

Energy Supply, Distribution, or Use 

The FAA has analyzed this proposed 

rulemaking under Executive Order 

13211, Actions Concerning Regulations 

that Significantly Affect Energy Supply, 

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

have determined that it is not a 

‘‘significant energy action’’ under the 

executive order because it is not a 

‘‘significant regulatory action’’ under 

Executive Order 12866, and it is not 

likely to have a significant adverse effect 

on the supply, distribution, or use of 

energy. 

List of Subjects in 14 CFR Part 158 

Air carriers, Airports, Passenger 

facility charge, Public agencies, 

Collection compensation. 

The Proposed Amendment 

Because of the above, the Federal 

Aviation Administration proposes to 

amend part 158 of Title 14, Code of 

Federal Regulations, as follows: 

PART 158—PASSENGER FACILITY 

CHARGES (PFCs) 

Subpart A—General 

1. The authority citation for part 158 

continues to read as follows: 

Authority: 49 U.S.C. 106(g), 40116–40117, 

47106, 47111, 47114–47116, 47524, 47526. 

2. Amend § 158.3 as follows: 

a. Revise the definitions for Air travel 

ticket, Approved Project, and State to 

read as set forth below. 

b. Add definitions for Covered air 

carrier, Financial need, Ground support 

equipment, Notice of intent (to impose 

a PFC or use PFC revenue), PFC 

administrative support costs, and Point 

of issuance for electronic tickets or other 

ticketing medium in alphabetical order 

to read as set forth below. 

§ 158.3 Definitions. 

* * * * * 

Air travel ticket includes all 

documents, electronic records, boarding 

passes, and any other ticketing medium 

about a passenger’s itinerary necessary 

to transport a passenger by air, 

including passenger manifests. 

* * * * * 

Approved project means a project for 

which the FAA has approved using PFC 

revenue under this part. The FAA may 

also approve specific projects contained 

in a single or multi-phased project or 

development described in an airport 

capital plan separately. This includes 

projects acknowledged by the FAA 

under § 158.30 of this part. 

* * * * * 

Covered air carrier means an air 

carrier that files for bankruptcy 

protection, or has an involuntary 

bankruptcy proceeding started against it 

after December 12, 2003. 

* * * * * 

Financial need means that a public 

agency cannot meet its operational or 

debt service obligations and does not 

have at least a 2-month reserve fund. 

* * * * * 

Ground support equipment means 

service and maintenance equipment 

used at an airport to support 

aeronautical operations and related 

activities. Baggage tugs, belt loaders, 

cargo loaders, forklifts, fuel trucks, 

lavatory trucks, and pushback tractors 

are among the types of vehicles that fit 

this definition. 

* * * * * 

Notice of intent (to impose a PFC or 

use PFC revenue) means a notice under 

§ 158.30 from a public agency 

controlling a non-hub airport that it 

intends to impose a PFC and or use PFC 

revenue. Except for §§ 158.25 through 

30, ‘‘notice of intent’’ can be used 

interchangeably with ‘‘application.’’ 

* * * * * 

PFC administrative support costs 

means the reasonable and necessary 

costs of developing a PFC application or 

amendment, issuing and maintaining 

the required PFC records, and 

performing the required audit of the 

public agency’s PFC account. These 

costs may include reasonable monthly 

financial account charges and 

transaction fees. 

Point of issuance of airline tickets 

means the billing address of the buyer’s 

credit card or the physical location of a 

cash or check transaction. 

* * * * * 

State means a State of the United 

States, the District of Columbia, the 

Commonwealth of Puerto Rico, the 

Virgin Islands, American Samoa, the 

Commonwealth of the Northern Mariana 

Islands, and Guam. 

* * * * * 

3. Amend § 158.9 by revising 

paragraphs (a)(4) and (5) and by adding 

paragraph (a)(6) to read as follows: 

§ 158.9 Limitations. 

(a) * * * 

(4) On flights, including flight 

segments, between 2 or more points in 

Hawaii; 

(5) In Alaska aboard an aircraft having 

a certificated seating capacity of fewer 

than 60 passengers; or 

(6) Enplaning at an airport if the 

passenger did not pay for the air 

transportation that resulted in the 

enplanement because of Department of 

Defense charter arrangements and 

payments. 

* * * * * 

4. Amend § 158.13 by revising 

paragraphs (b), (c), (d), and (e) and 

adding paragraphs (f), (g), and (h) to 

read as follows: 

§ 158.13 Use of PFC revenue. 

* * * * * 

(b) PFC administrative support costs. 

Public agencies may use PFC revenue to 

pay for allowable administrative 

support costs. Public agencies must 

submit these costs as a separate project 

in each PFC application. 

(c) Maximum cost for certain lowemission technology projects. If a project 

involves a vehicle or ground support 

equipment using low emission 

technology eligible under 158.15(b), the 

FAA will determine the maximum cost 

that may be financed by PFC revenue. 

The maximum cost for a new vehicle is 

the incremental amount between the 

purchase price of a new low emission 

vehicle and the purchase price of a 

standard emission vehicle, or the cost of 

converting a standard emission vehicle 

to a low emission vehicle. 

(d) Bond-associated debt service and 

financing costs. 

(1) Public agencies may use PFC 

revenue to pay debt service and 

financing costs incurred for a bond 

issued to carry out approved projects. 

(2) If the public agency’s bond 

documents require that PFC revenue be 

commingled in the general revenue 

stream of the airport and pledged for the 

benefit of holders of obligations, the 

FAA considers PFC revenue to have 

paid the costs covered in § 158.13(b)(1) 

if— 

(i) An amount equal to the part of the 

proceeds of the bond issued to carry out 

approved projects is used to pay 

allowable costs of such projects; and 

(ii) To the extent the PFC revenue 

collected in any year exceeds the debt 

service and financing costs on such 

bonds during that year, an amount equal 

to the excess is applied as required by 

§ 158.39. 

(e) Exception providing for the use of 

PFC revenue to pay for debt service for 

non-eligible projects. The FAA may 

authorize a public agency under 

§ 158.18 to impose a PFC for payments 

for debt service or indebtedness 

incurred to carry out an airport project 

that is not eligible if the FAA 

determines that such use is necessary 

because of the financial need of the 

public agency. 

(f) Combination of PFC revenue and 

Federal grant funds. A public agency 

may combine PFC revenue and airport 

grant funds to carry out an approved 

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project. These projects are subject to the 

record keeping and auditing 

requirements of this part, as well as the 

reporting, record keeping and auditing 

requirements imposed by the Airport 

and Airway Improvement Act of 1982 

(AAIA). 

(g) Non-Federal share. Public agencies 

may use PFC revenue to meet the nonFederal share of the cost of projects 

funded under the Federal Airport 

Improvement Program or the FAA 

‘‘Program to Permit Cost-Sharing of Air 

Traffic Modernization Projects’’ under 

49 U.S.C. 44517. 

(h) Approval of project following 

approval to impose a PFC. The public 

agency may not use PFC revenue or 

interest earned thereon except on an 

approved project. 

5. Amend § 158.15(b) by revising 

paragraphs (5) and (6) and adding 

paragraphs (7) and (8) to read as follows: 

§ 158.15 Project eligibility at PFC levels of 

$1, $2, or $3. 

* * * * * 

(b) * * * 

(5) Noise compatibility measures 

eligible for Federal assistance under 49 

U.S.C. 47504, without regard to whether 

the measures are approved under 49 

U.S.C. 47504; 

(6) Construction of gates and related 

areas at which passengers are enplaned 

or deplaned and other areas directly 

related to the movement of passengers 

and baggage in air commerce within the 

boundaries of the airport. These areas 

do not include restaurants, car rental 

and automobile parking facilities, or 

other concessions. Projects required to 

enable added air service by an air carrier 

with less than 50 percent of the annual 

passenger boardings at an airport have 

added eligibility. Such projects may 

include structural foundations and floor 

systems, exterior building walls and 

load-bearing interior columns or walls, 

windows, door and roof systems, 

building utilities (including heating, air 

conditioning, ventilation, plumbing, 

and electrical service), and aircraft 

fueling facilities next to the gate; or 

(7) A project approved under the 

FAA’s ‘‘Program to Permit Cost-Sharing 

of Air Traffic Modernization Projects.’’ 

under 49 U.S.C. 44517; or 

(8) If the airport is in an air quality 

nonattainment area (as defined by 

section 171(2) of the Clean Air Act (42 

U.S.C. 7501(2)) or a maintenance area 

referred to in section 175A of such Act 

(42 U.S.C. 7505a), and the project will 

result in the airport receiving 

appropriate emission credits as 

described in 14 CFR 47139, a project for: 

(i) Converting vehicles and ground 

support equipment powered by a diesel 

or gasoline engine used at a commercial 

service airport to low-emission 

technology certified or verified by the 

Environmental Protection Agency to 

reduce emissions or to use cleaner 

burning conventional fuels; or 

(ii) Acquiring for use at a commercial 

service airport vehicles and ground 

support equipment that include lowemission technology or use cleaner 

burning fuels. 

* * * * * 

6. Add § 158.18 to read as follows: 

§ 158.18 Use of PFC revenue to pay for 

debt service for non-eligible projects. 

(a) The FAA may authorize a public 

agency to impose a PFC on payments for 

debt service or indebtedness incurred to 

carry out an airport project that is not 

eligible if the FAA determines it is 

necessary because of the financial need 

of the public agency. The FAA defines 

financial need in § 158.3. 

(b) A public agency may request 

authority to impose a PFC and use PFC 

revenue under this section using the 

PFC application procedures in § 158.25. 

The public agency must document its 

financial position and explain its 

financial recovery plan that uses all 

available resources. 

(c) The FAA reviews the application 

using the procedures in § 158.27. The 

FAA will issue its decision on the 

public agency’s request under § 158.29. 

7. Add § 158.20 to read as follows: 

§ 158.20 Submission of required 

documents. 

(a) Letters and reports required by this 

part may be transmitted to the 

appropriate recipient (the public 

agency, air carrier, and/or the FAA) via 

e-mail, courier, facsimile, or U.S. Postal 

Service. 

(1) Documents sent electronically to 

the FAA must be prepared in a format 

readable to the FAA. Interested parties 

can obtain the format at the local FAA 

Airports Office. 

(2) Any transmission to FAA 

Headquarters, using regular U.S. Postal 

Service, is subject to inspection that 

may result in delay and damage due to 

the security process. 

(b) Public agencies and air carriers 

may use the FAA’s national PFC 

database to post their required quarterly 

reports, and, in that case, do not have 

to distribute the reports in any other 

way. 

Subpart B—Application and Approval 

8. Revise § 158.29(a)(1)(ii) and 

(b)(1)(ii) to read as follows: 

§ 159.29 The Administrator’s Decision. 

(a) * * * 

(1) * * * 

(ii) The project will achieve the 

objectives and criteria set forth in 

§ 158.15 except for those projects 

approved under § 158.18. 

* * * * * 

(b) * * * 

(1) * * * 

(ii) The project will achieve the 

objectives and criteria set forth in 

§ 158.15 except for those projects 

approved under § 158.18. 

* * * * * 

9. Amend § 158.30 by revising the 

section heading to read as follows: 

§ 158.30 PFC Authorization at Non-Hub 

Airports. 

* * * * * 

10. Amend § 158.31 by revising the 

introductory text and paragraph (b) to 

read as follows: 

§ 158.31 Duration of authority to impose a 

PFC after project implementation. 

A public agency that has begun 

implementing an approved project may 

impose a PFC until— 

* * * * * 

(b) The total PFC revenue collected 

plus interest earned thereon equals the 

allowable cost of the approved project; 

* * * * * 

11. Amend § 158.33 by revising 

paragraphs (a)(2), (c)(1) introductory 

text, and (c)(2) to read as follows: 

§ 158.33 Duration of authority to impose a 

PFC before project implementation. 

(a) * * * 

(2) 5 years after the charge effective 

date, or the date of the FAA’s decision 

on the application (if the charge 

effective date is more than 60 days after 

the decision date) if an approved project 

is not implemented. 

* * * * * 

(c) * * * 

(1) 3 years after the charge effective 

date, or the date of the FAA’s decision 

on the application (if the charge 

effective date is more than 60 days after 

the decision date) unless— 

* * * * * 

(2) 5 years after the charge effective 

date, or the date of the FAA’s decision 

on the application (if the charge 

effective date is more than 60 days after 

the decision date) unless the public 

agency has obtained project approval. 

* * * * * 

12. Amend § 158.37 by revising the 

section heading, paragraphs (b)(1)(i)(A), 

(b)(1)(ii)(C), and (b)(5) and redesignating 

(b)(1)(ii)(D) and (b)(1)(ii)(E) as 

(b)(1)(ii)(E) and (b)(1)(ii)(F), 

respectively, and adding a new 

(b)(1)(ii)(D) to read as follows: 

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§ 158.37 Amendment of approved PFC. 

* * * * * 

(b) * * * 

(1) * * * 

(i) * * * 

(A) Amend the approved PFC amount 

for a project by more than 25 percent of 

the original approved amount if the 

amount was $1,000,000 or greater. 

* * * * * 

(ii) * * * 

(C) To institute an increase of 25 

percent or less of the original approved 

amount if the amount was more than 

$1,000,000; 

(D) To institute an increase of any 

amount if the original approved amount 

of the project was less than $1,000,000. 

* * * * * 

(5) Justification, if the amendment 

involves a change in the PFC amount for 

a project by more than 25 percent of the 

original approved amount if that 

amount is $1,000,000 or greater, a 

change of the approved project scope, or 

any increase in the approved PFC level 

to be collected from each passenger; 

* * * * * 

13. Amend § 158.39 by revising 

paragraphs (a) and (d) to read as follows: 

§ 158.39 Use of excess PFC revenue. 

(a) If the PFC revenue remitted to the 

public agency, plus interest earned 

thereon, exceeds allowable costs of the 

project, public agencies must use excess 

funds for approved projects or to retire 

outstanding PFC-financed bonds. 

* * * * * 

(d) Within 30 days after the authority 

to impose a PFC has expired or been 

terminated, the public agency must 

present a plan to the appropriate FAA 

Airports office to begin using 

accumulated PFC revenue. The plan 

must include a timetable for submitting 

any necessary application under this 

part. If the public agency fails to submit 

such a plan, or if the plan is not 

acceptable to the Administrator, the 

Administrator may reduce Federal 

airport grant program apportioned 

funds. 

Subpart C—Collection, Handling and 

Remittance of PFCs 

14. Amend § 158.43 to revise 

paragraphs (b)(3) and (c) to read as 

follows: 

§ 158.43 Public agency notification to 

collect PFCs. 

* * * * * 

(b) * * * 

(3) The charge effective date will 

always be the first day of the month; 

however, it must be at least 30 days after 

the date the public agency notified the 

air carriers of the FAA’s approval to 

impose the PFC. 

* * * * * 

(c) The public agency must notify air 

carriers required to collect PFCs at its 

airport and the FAA of changes in the 

charge expiration date at least 30 days 

before the existing charge expiration 

date or new charge expiration date, 

whichever comes first. Each notified air 

carrier must notify its agents, including 

other issuing carriers, of such changes. 

* * * * * 

15. Amend § 158.45 by revising 

paragraph (a)(3) to read as follows: 

§ 158.45 Collection of PFCs on tickets 

issued in the U.S. 

(a) * * * 

(3) Issuing carriers and their agents 

shall collect PFCs based on the itinerary 

at the time of issuance. 

(i) Any change in itinerary initiated 

by a passenger that requires an 

adjustment to the amount paid by the 

passenger is subject to collection or 

refund of the PFC as appropriate. 

(ii) Failure to travel on a 

nonrefundable or expired ticket is not a 

change in itinerary. If the ticket 

purchaser is not permitted any fare 

refund on the unused ticket, the ticket 

purchaser is not permitted a refund of 

any PFC associated with that ticket. 

* * * * * 

16. Amend § 158.47 by revising 

paragraphs (a) and (c)(3) to read as 

follows: 

§ 158.47 Collection of PFCs on tickets 

issued outside the U.S. 

(a) For tickets issued outside the U.S., 

an air carrier or foreign air carrier may 

follow the requirements of either 

§ 158.45 or this section, unless the 

itinerary is for travel wholly within the 

U.S. Air carriers and foreign air carriers 

must comply with § 158.45 where the 

itinerary is for travel wholly within the 

U.S. regardless of where the ticket is 

issued. 

* * * * * 

(c) * * * 

(3) Issuing carriers and their agents 

shall collect PFCs based on the itinerary 

at the time of issuance. 

(i) Any change in itinerary initiated 

by a passenger that requires an 

adjustment to the amount paid by the 

passenger is subject to collection or 

refund of the PFC as appropriate. 

(ii) Failure to travel on a 

nonrefundable or expired ticket is not a 

change in itinerary. If the ticket 

purchaser is not permitted any fare 

refund on the unused ticket, the ticket 

purchaser is not permitted a refund of 

any PFC associated with that ticket. 

* * * * * 

17. Amend § 158.49 by revising 

paragraphs (b) and (c) and adding 

paragraph (d) to read as follows: 

§ 158.49 Handling of PFCs. 

* * * * * 

(b) Collecting carriers must account 

for PFC revenue separately. PFC 

revenue may be commingled with the 

air carrier’s other sources of revenue 

except for covered air carriers discussed 

in paragraph (c) of this section. PFC 

revenues held by an air carrier or an 

agent of the air carrier after collection 

are held in trust for the beneficial 

interest of the public agency imposing 

the PFC. Such air carrier or agent holds 

neither legal nor equitable interest in 

the PFC revenues except for any 

handling fee or interest collected on 

unremitted proceeds as authorized in 

§ 158.53. 

(c)(1) A covered air carrier must 

segregate PFC revenue in a designated 

separate PFC account. Regardless of the 

amount of PFC revenue in the covered 

air carrier’s account at the time the 

bankruptcy petition is filed, the covered 

air carrier must deposit into the separate 

PFC account an amount equal to the 

average monthly liability for PFCs 

collected under this section by such air 

carrier or any of its agents. 

(i) The covered air carrier is required 

to create one PFC account to cover all 

PFC revenue it collects. The designated 

PFC account is solely for PFC 

transactions and the covered air carrier 

must make all PFC transactions from 

that PFC account. The covered air 

carrier is not required to create separate 

PFC accounts for each airport where a 

PFC is imposed. 

(ii) The covered air carrier must 

transfer PFCs from its general accounts 

into the separate PFC account in an 

amount equal to the average monthly 

liability for PFCs as the ‘‘PFC reserve.’’ 

The PFC reserve must equal a onemonth average of the sum of the total 

PFCs collected by the covered air 

carrier, net of any credits or handling 

fees allowed by law, during the past 12-

month period of PFC collections 

immediately before entering 

bankruptcy. 

(iii) The minimum PFC reserve 

balance must never fall below the fixed 

amount defined in paragraph (c)(1)(ii) of 

this section. 

(iv) A covered air carrier may 

continue to deposit its PFCs into its 

general operating accounts combined 

with ticket sales revenue. However, at 

least once every business day, the 

covered air carrier must remove all PFC 

revenue (‘‘Daily PFC amount’’) from 

those accounts and transfer it to the new 

PFC account. An estimate based on 

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1⁄30 of the PFC reserve balance is 

permitted in substitution of the Daily 

PFC amount. 

(v) If the covered air carrier uses an 

estimate rather than the daily PFC 

amount, the covered air carrier shall 

reconcile the estimated amount with the 

actual amount of PFCs collected for the 

prior month (‘‘Actual Monthly PFCs’’). 

This reconciliation must take place no 

later than the 20th day of the month (or 

the next business day if the date is not 

a business day). In the event the actual 

monthly PFCs are greater than the 

aggregate estimated PFC amount, the 

covered air carrier will, within one 

business day of the reconciliation, 

deposit the difference into the PFC 

account. If the actual monthly PFCs are 

less than the aggregate estimated PFC 

amount, the covered air carrier will be 

entitled to a credit in the amount of the 

difference to be applied to the daily PFC 

amount due. 

(vi) The covered air carrier is 

permitted to recalculate and reset the 

PFC reserve and daily PFC amount on 

each successive anniversary date of its 

bankruptcy petition using the 

methodology described above. 

(2) If a covered air carrier or its agent 

fails to segregate PFC revenue in 

violation of paragraph (c) of this section, 

the trust fund status of such revenue 

shall not be defeated by an inability of 

any party to identify and trace the 

precise funds in the accounts of the air 

carrier. 

(3) A covered air carrier and its agents 

may not grant to any third party any 

security or other interest in PFC 

revenue. 

(4) A covered air carrier that fails to 

comply with any requirement of 

paragraph (c) of this section, or causes 

an eligible public agency to spend funds 

unnecessarily to recover or retain 

payment of PFC revenue, must 

compensate that public agency for those 

costs incurred to recover the PFCs 

owed. 

(5) The provisions of paragraph (b) of 

this section that allow the commingling 

of PFCs with other air carrier revenue 

do not apply to a covered air carrier. 

(d) All collecting air carriers must 

disclose the existence and amount of 

PFC funds regarded as trust funds in 

their financial statements. 

18. Revise § 158.53 to read as follows: 

§ 158.53 Collection compensation. 

(a) As compensation for collecting, 

handling, and remitting the PFC 

revenue, the collecting air carrier is 

entitled to: 

(1) $0.11 of each PFC collected. 

(2) Any interest or other investment 

return earned on PFC revenue between 

the time of collection and remittance to 

the public agency. 

(b) A covered air carrier that fails to 

designate a separate PFC account is 

prohibited from collecting interest on 

the account. Where a covered air carrier 

maintains a separate PFC account in 

compliance with § 158.49(c), it will 

receive the interest on PFC accounts as 

described in paragraph (a)(2) of this 

section. 

(c)(1) Collecting air carriers may file 

collection cost data periodically to the 

FAA after the agency issues a notice in 

the Federal Register that specifies the 

information and deadline for filing the 

information. Submission of the 

information is voluntary. The requested 

information must include data on 

interest earned by the air carrier on PFC 

revenue and audited air carrier 

collection, handling, and remittance 

costs in the following categories: 

(i) Credit card fees; 

(ii) Audit fees; 

(iii) PFC disclosure fees; 

(iv) Reservations costs; 

(v) Passenger service costs; 

(vi) Revenue accounting, data entry, 

accounts payable, tax, and legal fees; 

(vii) Corporate property department 

costs; 

(viii) Training for reservations agents, 

ticket agents, and other departments; 

(ix) Ongoing carrier information 

systems costs; 

(x) Ongoing computer reservations 

systems costs; and 

(xi) Airline Reporting Corporation 

fees. 

(2) Any new compensation level 

determined by the FAA’s analysis of 

data filed under paragraph (b)(1) of this 

section will replace the level identified 

in paragraph (a)(1) of this section. 

Subpart D—Reporting, Recordkeeping 

and Audits 

19. Amend § 158.63 by revising 

paragraphs (a) and (c) to read as follows: 

§ 158.63 Reporting requirements: Public 

agency. 

* * * * * 

(a) The public agency must provide 

quarterly reports to air carriers 

collecting PFCs for the public agency 

with a copy to the appropriate FAA 

Airports Office. The quarterly report 

must include: 

(1) Actual PFC revenue received from 

collecting air carriers, interest earned, 

and project expenditures for the quarter; 

(2) Cumulative actual PFC revenue 

received, interest earned, project 

expenditures, and the amount 

committed for use on currently 

approved projects, including the 

quarter; 

(3) The PFC level for each project; and 

(4) Each project’s current schedule. 

* * * * * 

(c) For medium or large hub airports, 

the public agency must provide to the 

FAA, by July 1 of each year, an estimate 

of PFC revenue to be collected for each 

airport in the following fiscal year. 

20. Revise § 158.65 to read as follows: 

§ 158.65 Reporting requirements: 

Collecting air carrier. 

(a) Each air carrier collecting PFCs for 

a public agency must file quarterly 

reports to the public agency unless 

otherwise agreed by the collecting air 

carrier and public agency, providing an 

accounting of funds collected and funds 

remitted. 

(1) Unless otherwise agreed by the 

collecting air carrier and public agency, 

reports must state: 

(i) The collecting air carrier and 

airport involved, 

(ii) The total PFC revenue collected, 

(iii) The total PFC revenue refunded 

to passengers, 

(iv) The collected revenue withheld 

for reimbursement of expenses under 

§ 158.53, and 

(v) The dates and amounts of each 

remittance for the quarter. 

(2) The report must be filed by the last 

day of the month following the calendar 

quarter or other period agreed by the 

collecting carrier and public agency for 

which funds were collected. 

(b) A covered air carrier must provide 

the FAA with: 

(1) A copy of its quarterly report by 

the established schedule under 

paragraph (a) of this section, and 

(2) A monthly PFC account statement 

delivered not later than the fifth day of 

the month. This monthly statement 

must include: 

(i) The balance in the account on the 

first day of the month; 

(ii) The total funds deposited during 

the month; 

(iii) The total funds dispersed during 

the month; and 

(iv) The closing balance in the 

account. 

21. Amend § 158.67 by revising 

paragraph (c)(2) to read as follows: 

§ 158.67 Recordkeeping and auditing: 

Public agency. 

* * * * * 

(c) * * * 

(2) Conducted as part of an audit 

under Office of Management and Budget 

Circular A–133 (the Single Audit Act of 

1984, Pub. L. 98–502, and the Single 

Audit Act Amendments of 1996, Pub. L. 

104–156) provided the PFC is 

specifically addressed by the auditor. 

* * * * * 

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5200 Federal Register / Vol. 71, No. 21 / Wednesday, February 1, 2006 / Proposed Rules 

Subpart E—Termination 

22. Revise § 158.81 to read as follows: 

§ 158.81 General. 

This subpart contains the procedures 

for terminating PFCs or loss of Federal 

airport grant funds for violations of this 

part or 49 U.S.C. 40117. This subpart 

does not address the circumstances 

under which authority to collect PFCs 

may be terminated for violations of 49 

U.S.C. 47523 through 47528. 

§ 158.97 [Removed] 

23. Remove § 158.97. 

24. Amend appendix A by revising 

paragraphs 10 and 12 of section B to 

read as follows: 

Appendix A to Part 158—Assurances 

* * * * * 

B. * * * 

* * * * * 

10. Recordkeeping and Audit. It will 

maintain an accounting record for audit 

purposes for 3 years after physical and 

financial completion of the project. All 

records must satisfy the requirements of 

14 CFR part 158 and contain 

documentary evidence for all items of 

project costs. 

* * * * * 

12. Compliance with 49 U.S.C. 47523 

through 47528. It understands 49 U.S.C. 

47524 and 47526 require the authority 

to impose a PFC be terminated if the 

Administrator determines the public 

agency has failed to comply with those 

sections of the United States Code or 

with the implementing regulations 

published under the Code. 

Issued in Washington, DC, on January 26, 

2006. 

Dennis E. Roberts, 

Director, Office of Airport Planning and 

Programming. 

[FR Doc. 06–896 Filed 1–31–06; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

21 CFR Parts 203 and 205 

[Docket No. 2005N–0428] 

Distribution of Blood Derivatives by 

Registered Blood Establishments that 

Qualify as Health Care Entities; 

Prescription Drug Marketing Act of 

1987; Prescription Drug Amendments 

of 1992; Policies, Requirements and 

Administrative Procedures 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Proposed rule. 

SUMMARY: The Food and Drug 

Administration (FDA) proposes to 

amend the regulations to allow certain 

registered blood establishments that 

qualify as health care entities to 

distribute drug products that are 

derivatives of blood (blood derivatives). 

This proposed rule, which is specific to 

registered blood establishments and the 

distribution of blood derivatives, if 

finalized, would amend certain limited 

provisions of the regulations 

implementing the Prescription Drug 

Marketing Act of 1987 (PDMA), as 

modified by the Prescription Drug 

Amendments of 1992 (PDA) and the 

FDA Modernization Act of 1997. As 

currently written, these regulations, 

among other things, restrict the sale, 

purchase, or trade of, or the offer to sell, 

purchase, or trade, prescription drugs 

purchased by hospitals and other health 

care entities. 

DATES: Submit written or electronic 

comments on the proposed rule by May 

2, 2006. 

ADDRESSES: You may submit comments, 

identified by Docket No. 2005N–0428, 

by any of the following methods: 

Electronic Submissions 

Submit electronic comments in the 

following ways: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Agency Web site: http:// 

www.fda.gov/dockets/ecomments. 

Follow the instructions for submitting 

comments on the agency Web site. 

Written Submissions 

Submit written submissions in the 

following ways: 

• FAX: 301–827–6870. 

• Mail/Hand delivery/Courier [For 

paper, disk, or CD-ROM submissions]: 

Division of Dockets Management (HFA– 

305), Food and Drug Administration, 

5630 Fishers Lane, rm. 1061, Rockville, 

MD 20852. 

To ensure more timely processing of 

comments, FDA is no longer accepting 

comments submitted to the agency by email. FDA encourages you to continue 

to submit electronic comments by using 

the Federal eRulemaking Portal or the 

agency Web site, as described in the 

Electronic Submissions portion of this 

paragraph. 

Instructions: All submissions received 

must include the agency name and 

Docket No(s). and Regulatory 

Information Number (RIN) (if a RIN 

number has been assigned) for this 

rulemaking. All comments received may 

be posted without change to http:// 

www.fda.gov/ohrms/dockets/ 

default.htm, including any personal 

information provided. For additional 

information on submitting comments, 

see the ‘‘Comments’’ heading of the 

SUPPLEMENTARY INFORMATION section of 

this document. 

Docket: For access to the docket to 

read background documents or 

comments received, go to http:// 

www.fda.gov/ohrms/dockets/ 

default.htm and insert the docket 

number(s), found in brackets in the 

heading of this document, into the 

‘‘Search’’ box and follow the prompts 

and/or go to the Division of Dockets 

Management, 5630 Fishers Lane, rm. 

1061, Rockville, MD 20852. 

FOR FURTHER INFORMATION CONTACT: 

Kathleen Swisher, Center for Biologics 

Evaluation and Research (HFM–17), 

Food and Drug Administration, 1401 

Rockville Pike, suite 200N, Rockville, 

MD 20852–1448, 301–827–6210. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The PDMA (Public Law 100–293) was 

enacted on April 22, 1988, and was 

modified by the PDA (Public Law 102– 

353, 106 Stat. 941) on August 26, 1992. 

The PDMA, as modified, amended the 

Federal Food, Drug, and Cosmetic Act 

(the act) to establish restrictions and 

requirements relating to various aspects 

of human prescription drug marketing 

and distribution. Among other things, 

the PDMA prohibited, with certain 

exceptions, the sale, purchase, or trade 

(or offer to sell, purchase, or trade) of 

prescription drugs that were purchased 

by hospitals or other health care 

entities. Section 503(c)(3)(A)(ii)(I) of the 

act (21 U.S.C. 353(c)(3)(A)(ii)(I)). Section 

503(c)(3) also states that ‘‘[f]or purposes 

of this paragraph, the term ‘entity’ does 

not include a wholesale distributor of 

drugs or a retail pharmacy licensed 

under State law * * *.’’ 

In the Federal Register of March 14, 

1994 (59 FR 11842), we issued a 

proposed rule to implement those 

PDMA sections that were not 

implemented by the final rule of 

September 14, 1990, that set forth 

Federal guidelines for State licensing of 

wholesale drug distributors (55 FR 

38012). The proposed rule contained 

provisions on prescription drug 

reimportation; wholesale distribution of 

prescription drugs by unauthorized 

distributors; the resale of prescription 

drugs by hospitals, health care entities, 

and charitable institutions; and 

distribution of prescription drug 

samples. After consideration of 

comments, we issued a final rule in the 

Federal Register of December 3, 1999