Federal Register / Vol. 65, No. 77 / Thursday, April 20, 2000 / Proposed Rules 21151

5 or worse) because of test weight, percentage

of sound barley (heat-damaged kernels will

be considered to be sound barley), damaged

kernels (heat-damaged kernels will not be

considered to be damaged), thin barley, black

barley, a musty, sour, or commercially

objectional foreign odor (except smut or

garlic odor), or grading blighted, smutty,

garlicky, or ergoty;

(C) Oats not meeting the grade

requirements for U.S. No. 4 (grade U.S.

sample grade) because of test weight or

percentage of sound oats (heat-damaged

kernels will be considered to be sound oats),

a musty, sour, or commercially objectional

foreign odor (except smut or garlic odor), or

grading smutty, thin, garlicky, or ergoty;

(D) Rye not meeting the grade requirements

for U.S. No. 3 (grades U.S. No. 4 or worse)

because of test weight, percent damaged

kernels (heat-damaged kernels will not be

considered to be damaged) or thin rye, a

musty, sour, or commercially objectional

foreign odor (except smut or garlic odor), or

grading light smutty, smutty, light garlicky,

garlicky, or ergoty;

(E) Flaxseed not meeting the grade

requirements for U.S. No. 2 (grades U.S.

sample grade) due to test weight, damaged

kernels (heat-damaged kernels will not be

considered to be damaged), or a musty, sour,

or commercially objectional foreign odor

(except smut or garlic odor);

(ii) Deficiencies in the quality of

buckwheat, determined in accordance with

applicable state grading standards, result in

it having a test weight lower than 42 pounds

per bushel, or a musty, sour or commercially

objectional foreign odor (except smut or

garlic odor), or grading garlicky, smutty or

ergoty if such grades are provided for by the

applicable state grading standards;

(iii) Quality factors for Kamut fall below

the levels contained in the Official United

States Standards for Grain that cause durum

wheat to grade less than U.S. No. 4. For

example, if durum wheat grades less than

U.S. No. 4 when its test weight falls below

54.0 pounds per bushel, Kamut would be

eligible for quality adjustment if its test

weight falls below 54.0 pounds per bushel.

The same quality factors considered for

quality adjustment of durum wheat will be

applicable and determination of deficiencies

will be made in accordance with the Federal

Grain Inspection Service directive that

establishes procedures for quality factor

analysis of Kamut seed; or

(iv) Substances or conditions are present,

including mycotoxins, that are identified by

the Food and Drug Administration or other

public health organizations of the United

States as being injurious to human or animal

health.

(3) Quality will be a factor in determining

your loss only if:

(i) The deficiencies, substances, or

conditions resulted from a cause of loss

against which insurance is provided under

these crop provisions;

(ii) All determinations of these

deficiencies, substances, or conditions are

made using samples of the production

obtained by us or by a disinterested third

party approved by us; and

(iii) The samples are analyzed by a grain

grader licensed under the authority of the

United States Grain Standards Act or the

United States Warehouse Act with regard to

deficiencies in quality, or by a laboratory

approved by us with regard to substances or

conditions injurious to human or animal

health. Test weight for quality adjustment

purposes may be determined by our loss

adjustor.

(4) Small grain production that is eligible

for quality adjustment, as specified in

sections 11(d)(2) and (3), will be reduced by

the quality adjustment factor contained in the

Special Provisions.

* * * * *

12. Late Planting

A late planting period is applicable to

small grains, except, to any wheat acreage

covered under the terms of the Wheat Crop

Insurance Winter Coverage Endorsement.

Wheat covered under the terms of the Wheat

Crop Insurance Winter Coverage

Endorsement must be planted on or prior to

the applicable final planting date specified in

the Special Provisions. In counties having a

fall final planting date for acreage covered

under the Wheat Winter Coverage

Endorsement and a fall final planting date for

acreage not covered under the endorsement,

the fall late planting period will begin after

the final planting date for acreage not

covered under the endorsement.

* * * * *

3. Amend the crop insurance

endorsement contained in § 457.102 as

follows:

a. Revise section (b);

b. Add section (c)(5);

c. Amend Option A by revising the

heading, the introductory paragraph and

paragraph (a) introductory text; and

d. Amend Option B by revising the

heading, the introductory paragraph and

paragraph (c) introductory text, all to

read as follows:

§ 457.102 Wheat crop insurance winter

coverage endorsement.

* * * * *

(b) This endorsement is available only in

counties for which the Special Provisions

designate both a fall final planting date and

a spring final planting date, and for which

the actuarial table provides a premium rate

for this coverage.

(c) * * *

(5) All eligible winter wheat acreage must

be insured under this endorsement.

* * * * *

Option A (50 Percent Coverage and Acreage

Release)

Whenever any winter wheat is damaged

during the insurance period and at least 20

acres or 20 percent of the acreage in the unit,

whichever is less, does not have an adequate

stand to produce at least 90 percent of the

production guarantee for the acreage, you

may, at your option, take one of the following

actions:

(a) Destroy the remaining crop on such

acreage. By doing so, you agree to accept an

amount of production to count against the

unit production guarantee equal to 50

percent of the production guarantee for the

damaged acreage, or an appraisal determined

in accordance with section 11(c)(1) of the

Small Grains Crop Provisions if such an

appraisal results in a greater amount of

production. This amount will be considered

production to count in determining any final

indemnity on the unit and will be used to

settle your claim as described in section 11

(Settlement of Claim) of the Small Grains

Crop Provisions. You may use such acreage

for any purpose, including planting and

separately insuring any other crop. If you

elect to plant spring wheat, it will be insured

in accordance with the policy provisions that

are applicable to acreage that is initially

planted to spring wheat, and you must:

* * * * *

Option B (70 Percent Coverage and Acreage

Release)

Whenever any winter wheat is damaged

during the insurance period and at least 20

acres or 20 percent of the acreage in the unit,

whichever is less, does not have an adequate

stand to produce at least 90 percent of the

production guarantee for the acreage, you

may, at your option, take one of the following

actions:

* * * * *

(c) Destroy the remaining crop on such

acreage. By doing so, you agree to accept an

amount of production to count against the

unit production guarantee equal to 30

percent of the production guarantee for the

damaged acreage, or an appraisal determined

in accordance with section 11(c)(1) of the

Small Grains Crop Provisions if such an

appraisal results in a greater amount of

production. This amount will be considered

production to count in determining any final

indemnity on the unit and will be used to

settle your claim as described in section 11

(Settlement of Claim) of the Small Grains

Crop Provisions. You may use such acreage

for any purpose, including planting and

separately insuring any other crop. If you

elect to plant spring wheat, it will be insured

in accordance with the policy provisions that

are applicable to acreage that is initially

planted to spring wheat, and you must:

* * * * *

Signed in Washington, DC, on April 11,

2000.

Kenneth D. Ackerman,

Manager, Federal Crop Insurance

Corporation.

[FR Doc. 00–9599 Filed 4–19–00; 8:45 am]

BILLING CODE 3410–08–P

FARM CREDIT ADMINISTRATION

12 CFR Parts 614, 615, and 618

RIN 3052–AB96

Loan Policies and Operations; Funding

and Fiscal Affairs, Loan Policies and

Operations, and Funding Operations;

General Provisions; OFI Lending

AGENCY: Farm Credit Administration

(FCA).

21152 Federal Register / Vol. 65, No. 77 / Thursday, April 20, 2000 / Proposed Rules

1 12 U.S.C. 2001 et seq.

2 12 U.S.C. 2020(b).

3 12 U.S.C. 2015(b).

4 12 U.S.C. 2075. 5See 63 FR 36541 (July 7, 1998).

ACTION: Advance notice of proposed

rulemaking (ANPRM).

SUMMARY: The FCA is considering

whether to revise its regulations

governing how Farm Credit System

(System) banks lend to other financing

institutions (OFIs). OFIs include

commercial banks, savings institutions,

credit unions, trust companies,

agricultural credit corporations, and

other agricultural and aquatic lenders.

This ANPRM asks you to comment on

the appropriate risk weighting of System

bank loans to OFIs, the public

availability of the identities of OFIs,

cross-district funding of OFIs, and ways

to improve System banks’ funding of

OFIs.

DATES: You may send us comments by

June 19, 2000.

ADDRESSES: Send us your comments by

electronic mail to ‘‘reg-com@fca.gov’’ or

through the Pending Regulations section

of our Web site at ‘‘www.fca.gov.’’ You

may also send written comments to

Patricia W. DiMuzio, Director,

Regulation and Policy Division, Office

of Policy and Analysis, Farm Credit

Administration, 1501 Farm Credit Drive,

McLean, Virginia 22102–5090, or by

facsimile transmission to (703) 734–

5784. You may review copies of all

comments we receive in the Office of

Policy and Analysis, Farm Credit

Administration.

FOR FURTHER INFORMATION CONTACT:

Dennis K. Carpenter, Senior Policy

Analyst, Office of Policy and

Analysis, Farm Credit Administration,

McLean, VA 22102–5090, (703) 883–

4498, TDD (703) 883–4444,

or

Rebecca S. Orlich, Senior Attorney,

Office of General Counsel, Farm

Credit Administration, McLean, VA

22102–5090, (703) 883–4020, TDD

(703) 883–4444.

SUPPLEMENTARY INFORMATION:

I. Objective

The objective of this ANPRM is to

seek comment on whether we should

revise FCA’s regulations to improve and

better promote OFI access to System

funding. Through this ANPRM, we seek

comment on issues related to:

• Revising System banks’

capitalization requirements for loans to

OFIs;

• Permitting disclosure of OFI

corporate identities;

• Removing geographical

impediments to OFIs’ obtaining System

bank funding; and

• Identifying other impediments to

System bank funding of OFIs.

This ANPRM is another step in

supporting the FCA Board’s Philosophy

Statement of July 14, 1998, in which we

explained our goal to give farmers and

ranchers greater access to credit.

II. Background

The Farm Credit Act of 1971, as

amended (1971 Act),1 authorizes Farm

Credit Banks (FCBs) and agricultural

credit banks (ACBs) (collectively,

System banks) to fund and discount

short- and intermediate-term loans for

certain non-System lenders. The 1971

Act refers to these non-System lenders

as other financing institutions, or OFIs.2

Under the 1971 Act, OFIs include:

• National and State banks;

• Trust companies;

• Agricultural credit corporations;

• Incorporated livestock loan

companies;

• Savings institutions;

• Credit unions;

• Any association of agricultural

producers making loans to farmers and

ranchers; and

• Any corporation making loans to

producers or harvesters of aquatic

products.

Section 1.7(b) of the 1971 Act 3

enables OFIs to get funding from FCBs

or ACBs for any loan that a production

credit association (PCA) could make

under section 2.4 4 of the 1971 Act. PCA

loans are short-and intermediate-term

loans with maturities ranging up to 10

years (15 years to producers or

harvesters of aquatic products). Only

eligible farmers, ranchers, aquatic

producers and harvesters, processing

and marketing operators, farm-related

businesses, and rural homeowners can

get these loans.

The OFI discount and lending

authorities of System banks help to

fulfill the banks’ mission to finance

agriculture, aquaculture, and other

named rural needs. Congress first

granted OFI lending authorities to

System banks in 1923 and 1930, in the

predecessor legislation to the 1971 Act.

Legislative history reveals that

Congress originally granted OFIs

discount privileges at System banks

because operating credit for farmers and

ranchers was scarce. Since then,

Congress has continued to respond to

the changing needs of agricultural

producers and other rural residents for

affordable short-and intermediate-term

credit. Over the decades, Congress has

updated the authorities of System banks

to fund and aid both System and nonSystem lenders. As our Philosophy

Statement on competition provides and

as directed by provisions of the 1971

Act, we continue to explore ways of

making competitive credit available

through more avenues to farmers,

ranchers, and other eligible borrowers.

In the early 1980s, both the number of

OFIs and the volume of business they

do with System banks peaked and

subsequently declined and have since

remained significantly low. In 1997, to

expand OFIs’ access to System bank

funding and discounting, we amended

our regulations to remove many OFI

eligibility limits not required by the

1971 Act.5 We also required a System

bank’s assessment of total charges for an

OFI loan to be comparable to the

charges the bank imposes on its direct

lender System institutions. In addition,

to improve safety and soundness, those

amendments also required all OFI loans

to be full-recourse loans.

III. Philosophy Statement

Among other things, our 1998

Philosophy Statement on competition

communicates our desire for the System

to more fully serve the credit needs of

agricultural producers and other rural

borrowers, as Congress intended,

including short-and intermediate-term

credit. The System banks’ relationship

with OFIs is important for meeting these

needs. To support the bank and OFI

relationship, we continue to identify

ways to improve OFIs’ access to System

funding. After reviewing our regulatory

requirements, we have decided to

consider the following changes:

(1) Revising the level of capital

System banks must hold against their

loans to OFIs based on certain risk

characteristics;

(2) Permitting disclosure of the names

of entities that have an OFI relationship

with a System bank; and

(3) Removing impediments to setting

up an OFI relationship outside a System

bank’s territorial boundaries.

We believe that revising these

requirements may spur development of

more OFI relationships and, thus,

provide added avenues of credit

available to farmers and ranchers.

We recognize that reducing the risk

weighting on OFI loans could reduce

capital available to support the risk in

the bank’s assets. However, if the risk is

properly assessed, such adjustment to

the risk weighting should not pose a

safety and soundness concern.

Furthermore, we believe an approach to

capital requirements of OFIs that is

more consistent with those of System

associations is appropriate.

Federal Register / Vol. 65, No. 77 / Thursday, April 20, 2000 / Proposed Rules 21153

6 12 CFR 615.5210(f)(2)(iv)(C).

7 12 CFR 615.5210(f)(2)(ii)(I).

8 12 CFR 614.4120 and 614.4125.

9 12 U.S.C. 2261–2274.

10 12 U.S.C. 2154, 2154a: 12 CFR part 615,

subparts H through M.

11 12 CFR 614.4120, 614.4130, and 614.4560(a)(1).

12 12 CFR 614.4570.

13 12 U.S.C. 2254(a), 2255, 2257.

14 12 U.S.C. 2256; 12 CFR 614.4560(e).

15 12 U.S.C. 2015(b)(3).

16 Information about the Basle Accord proposals

is at the Web site for the Bank for International

Settlements, www.bis.org.

In this ANPRM, we seek comments

from all interested parties to aid us in

developing proposed regulations that

increase opportunities for OFI lending

to the extent allowed by the Act and

within appropriate safety and

soundness boundaries. We also ask for

your help in identifying other

impediments to System bank funding of

OFIs.

A. Risk-Weighting Requirements of

Capital

1. Current Basis for Risk-Weighting

Requirements

Subparts H and K of part 615 of FCA

regulations impose risk-based capital

requirements on System banks. We

adopted risk-weighting categories for

System bank assets as part of the 1988

regulatory capital revisions required by

the Agricultural Credit Act of 1987. The

categories are similar to the riskweighting categories from the 1988

International Basle Accord, whose

principles the Federal banking

regulators have also adopted.

Under our regulations, a System

bank’s loan to an OFI receives a risk

weighting of 100 percent.6 This means

that, for a System bank to meet its

minimum 7-percent permanent capital

requirement on a loan to an OFI, it

would need to hold a minimum of $7.00

in capital against each $100 of the loan

to the OFI ($100 × 100 percent × 7

percent). By contrast, a loan to an

affiliated System association receives a

risk weighting of 20 percent.7 This

translates to the bank’s holding a

minimum of $1.40 in capital for each

$100 of loan to the association ($100 ×

20 percent × 7 percent).

The FCA’s decision to risk-weight a

loan to an affiliated System institution

at 20 percent was based on several

general characteristics that serve to

lower the risk of that category of loans.

They are:

• GFA Requirements. The association

must enter a general financing

agreement (GFA) with its bank, under

which the association must meet the

bank’s lending and loan underwriting

standards.8

• Pledge of Collateral. The

association typically pledges all its

assets as collateral for the loan from the

bank, and the bank is usually the

association’s only source of funding.

• Bank Supervision. System banks,

under the 1971 Act and related FCA

regulations, have supervisory authority

over certain aspects of System

association operations.

• FCA Examination and Regulation.

Our examination of System associations

ensures that we are aware of any

creditworthiness or other concerns at an

early stage and can take corrective

action. Under our statutory authority,

we can take supervisory and

enforcement actions against System

associations when the need arises.9

• FCA Capital Rules. We prescribe

capital standards that System

associations must meet, to ensure the

associations have enough capital to

operate safely and soundly.10

2. Comparison of OFI Funding

Characteristics

System bank funding relationships

with OFIs have some, but not all, of the

risk-reducing features of System bank

loans to System associations. They are:

• GFA Requirement. A System bank

must have the same type of GFA with

an OFI that it has with a System

association.11

• Pledge of Collateral. Although some

OFIs use System banks as their sole

source of funding and pledge all assets

to the loan, more typically an OFI has

multiple sources of funding and does

not pledge all assets as collateral to the

System bank. Nevertheless, FCA

regulations require a System bank to

take as collateral all notes, drafts, and

other obligations it funds or discounts

for an OFI, and the OFI must endorse

each obligation with full recourse or an

unconditional guarantee. The bank must

also require the OFI to provide extra

collateral or other credit enhancements

when needed.12

• Bank Supervision. The 1971 Act

and our regulations do not give System

banks supervisory authority over OFIs.

• FCA Examination and Regulation.

The law does not require us to examine

OFIs, but the 1971 Act and regulations

enable us either to examine OFIs or to

have access to other regulators’

examination reports. The 1971 Act

allows us to examine all OFIs, except

federally regulated financial

institutions, and allows Federal

agencies to give us all reports and other

information they have on the condition

of any OFI.13 In addition, under the

1971 Act and our regulations, each OFI

that is a State-chartered bank, trust

company, or savings institution must

authorize its State regulator to give us

examination reports. Each OFI that is

not a depository institution must

consent in writing to be examined by

us.14 However, we do not have general

authority to regulate the activities of

OFIs (other than the funding

relationship with the System bank) or to

take supervisory or enforcement actions

against OFIs.

• FCA Capital Rules. We do not

impose capital requirements on OFIs.

However, the 1971 Act does limit OFI

funding and discounting to OFIs whose

debt is less than 10 times their paid-in

and unimpaired capital and surplus, or

a lesser amount if allowed by the laws

of the OFI’s jurisdiction.15 In addition,

some OFIs, such as commercial banks

and savings institutions, have capital

requirements that are similar to our

requirements for System institutions.

3. Risk-Weighting Options

We have several choices for revising

the risk weighting of loans to OFIs. If we

decide that OFI loans, as a class, have

a lower risk than other assets in the 100-

percent risk-weighting category, we can

lower the risk weighting uniformly on

all OFI loans.

Another alternative is to place OFI

loans in different risk-weighting

categories to reflect differences in the

type of OFI. Loans to OFIs that are

regularly examined and have capital

requirements similar to our capital

rules, such as commercial banks, might

qualify for a lower risk weighting. Other

OFIs that are unregulated and do not

have capital requirements similar to our

capital rules might have a higher risk

weighting.

Yet another choice would be to lower

the risk weighting on loans to OFIs that

meet certain risk mitigation criteria. For

example, a proposed June 1999 revision

to the Basle Accord seeks to reassess the

risk weightings currently assigned to

assets.16 The proposed revision would

place a new emphasis on using risk

mitigation techniques and

differentiating risk exposures. To

mitigate risk on an OFI loan, and thus

lower the risk weighting, the OFI could

pledge additional security in the form of

readily marketable, highly liquid

securities (such as AAA-or AA-rated

securities). Another risk mitigation

technique would be for a System bank

to analyze an OFI’s capital and financial

condition and to require the OFI to meet

and maintain certain capital standards,

through terms of their GFA.

21154 Federal Register / Vol. 65, No. 77 / Thursday, April 20, 2000 / Proposed Rules

17 12 CFR part 618, subpart G.

18We note that the financial privacy protections

of the recently enacted Gramm-Leach-Bliley Act,

Pub. L. 106–102 (Nov. 12, 1999), protect only

financial institution customers that are

‘‘consumers’’—that is, individuals.

19See 63 FR 36541 (July 7, 1998).

B. Disclosure of Names of OFIs

The FCA’s regulations on releasing

information 17 currently prohibit System

institutions from disclosing information

about borrowers and stockholders. Also,

the FCA has routinely kept confidential

the names of borrowers that we have

obtained during examinations.

However, we have never interpreted

these prohibitions as preventing release

of the names of PCAs (or other System

associations) that, like OFIs, borrow

from a System bank but are not retail

borrowers. In fact, this information is

widely known because each System

bank issues publicly available financial

statements identifying its PCAs and

other affiliated associations.

The reasons for protecting the identity

of retail borrowers, who are mostly

individual consumers such as farmers

and ranchers or rural homeowners, may

not be present for OFIs.18 Keeping the

identities of retail borrowers

confidential shields them from

unwanted marketing solicitations or

publicity involving their personal

financial business. It is unlikely that

publicly identifying OFIs would have

these effects. On the contrary, disclosing

the names of lenders with OFI

relationships could benefit OFIs because

it could make prospective retail

borrowers aware of these added sources

of credit.

In this light, we are considering a

requirement to disclose the names of

entities that have OFI relationships with

System banks. We are interested in

receiving your comments and

recommendations on the conditions

under which to release the information.

We note that we are not considering the

release of any information about OFIs

except the name of the business and

other identifying information such as

the type of agricultural credit the OFI

offers.

C. Cross-District Lending

In July 1998, we amended the

regulations to authorize a System bank

to lend to an OFI whose headquarters

are outside of the bank’s territory or a

majority of whose loan volume is

outside of the bank’s territory.19 The

final OFI regulations specifically revised

§ 614.4550 to allow:

(1) FCBs and ACBs to provide funding

to any OFI applicant that maintains its

headquarters in the funding bank’s

chartered territory, or has more than 50

percent of its outstanding eligible loan

volume in the funding bank’s chartered

territory; and

(2) OFIs to apply to any other FCB or

ACB if the original FCB or ACB denies

or otherwise fails to approve an OFI’s

funding request within 60 days of

receipt of a ‘‘completed application’’ as

defined by 12 CFR 202.2(f).

In addition, an FCB or ACB may grant

its consent for an OFI to seek financing

from another System bank. The

regulation also provides that no OFI will

be required to terminate its existing

funding or discount relationship with

an FCB or ACB if, at a subsequent time,

an OFI relocates its headquarters to the

chartered territory of another System

bank or the loan volume in the relevant

territory falls below 50 percent.

The 1998 amendments gave new

flexibility to OFIs for choosing a System

bank for establishing a funding

relationship. But we retained some

restrictions because, at the time, System

associations were restricted in their

ability to seek financing from other

System banks. However, the Board’s

subsequent Philosophy Statement

supports broader funding access for

borrowers and lending institutions.

Therefore, given our continued interest

to explore different alternatives that

provide greater access to System

funding, we are seeking comment on

possible ways to provide greater

flexibility to OFIs setting up funding

relationships with System banks in

different districts.

IV. Questions

In this ANPRM, we seek your

comments on the following:

1. If we lower the risk weighting of

capital to be held by System banks for

all types of loans to OFIs, what riskweighting category would be

appropriate? Please provide your

analysis of the level of risk weighting

that you recommend.

2. How should we address the variety

of possible OFI types and OFI

relationships:

a. Would it be more appropriate to

lower the risk weighting on OFI loans

on a case-by-case basis, based on

underwriting criteria for various risk

categories? Why or why not? What

underwriting criteria should we require

System banks to establish for the

various levels of risk weighting?

b. Should we consider the use of risk

mitigation techniques (such as a pledge

of added security), or differentiate

between direct retail credit risk

exposure and wholesale credit risk

exposure? Why or why not? Please

recommend how we should address risk

mitigation techniques in our

regulations.

c. What is the appropriate level of risk

weighting on loans to OFIs that meet

risk mitigation criteria? Please provide

your recommendations and analysis.

3. Should we allow or require System

banks to release the names of OFIs on

request? Are there any drawbacks for

the System bank, the OFI, or the OFI’s

customers, if the identities of OFIs are

released? Do you believe any limits on

the release of such information are

necessary? Please provide your

recommendations and associated

explanation.

4. Should new regulations continue

the territorial limits for OFIs’ funding

access to System banks as addressed in

existing § 614.4550? If not, what if any

factors should limit an OFI’s choice of

System bank? Please provide your

recommendations and explanation.

5. Are there other regulatory changes

we could make or alternatives not

addressed above that we should

consider to improve a System bank’s

ability to serve an OFI and its

agricultural customers? Please provide

your recommendations and explanation

for such alternatives.

Dated: April 13, 2000.

Vivian L. Portis,

Secretary, Farm Credit Administration Board.

[FR Doc. 00–9849 Filed 4–19–00; 8:45 am]

BILLING CODE 6705–01–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. 99–NM–240–AD]

RIN 2120–AA64

Airworthiness Directives; Airbus

Industrie Model A300, A300–600, and

A310 Series Airplanes

AGENCY: Federal Aviation

Administration, DOT.

ACTION: Notice of proposed rulemaking

(NPRM).

SUMMARY: This document proposes the

supersedure of an existing airworthiness

directive (AD), applicable to certain

Airbus Model A300, A300–600, and

A310 series airplanes, that currently

requires inspections to detect cracks in

the lower spar axis of the nacelle pylon

between ribs 9 and 10, and repair, if

necessary. The existing AD also

provides for optional modification of

the pylon, which terminates the

inspections for Model A300 and A310