This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

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REGISTER issue of each week.

Rules and Regulations Federal Register

6745 

Vol. 81, No. 26 

Tuesday, February 9, 2016 

DEPARTMENT OF AGRICULTURE 

Animal and Plant Health Inspection 

Service 

9 CFR Part 53 

[Docket No. APHIS–2015–0061] 

RIN 0579–AE14 

Conditions for Payment of Highly 

Pathogenic Avian Influenza Indemnity 

Claims 

AGENCY: Animal and Plant Health 

Inspection Service, USDA. 

ACTION: Interim rule and request for 

comments. 

SUMMARY: We are amending the 

regulations pertaining to certain 

diseases of livestock and poultry to 

specify conditions for payment of 

indemnity claims for highly pathogenic 

avian influenza (HPAI). Specifically, we 

are providing a formula that will allow 

us to split such payments between 

poultry and egg owners and parties with 

which the owners enter into contracts to 

raise or care for the eggs or poultry 

based on the proportion of the 

production cycle completed. This action 

is necessary to ensure that all 

contractors are compensated 

appropriately. We are also providing for 

the payment of indemnity for eggs 

required to be destroyed due to HPAI, 

thus clarifying an existing policy. 

Finally, we are requiring owners and 

contractors, unless specifically 

exempted, to provide a statement that at 

the time of detection of HPAI in their 

facilities, they had in place and were 

following a biosecurity plan aimed at 

keeping HPAI from spreading to 

commercial premises. 

DATES: This interim rule is effective 

February 9, 2016. We will consider all 

comments that we receive on or before 

April 11, 2016. 

ADDRESSES: You may submit comments 

by either of the following methods: 

• Federal eRulemaking Portal: Go to 

http://www.regulations.gov/#!docket

Detail;D=APHIS-2015-0061. 

• Postal Mail/Commercial Delivery: 

Send your comment to Docket No. 

APHIS–2015–0061, Regulatory Analysis 

and Development, PPD, APHIS, Station 

3A–03.8, 4700 River Road Unit 118, 

Riverdale, MD 20737–1238. 

Supporting documents and any 

comments we receive on this docket 

may be viewed at http://www.

regulations.gov/#!docketDetail;D=

APHIS-2015-0061 or in our reading 

room, which is located in room 1141 of 

the USDA South Building, 14th Street 

and Independence Avenue SW., 

Washington, DC. Normal reading room 

hours are 8 a.m. to 4:30 p.m., Monday 

through Friday, except holidays. To be 

sure someone is there to help you, 

please call (202) 799–7039 before 

coming. 

FOR FURTHER INFORMATION CONTACT: Dr. 

Troy Bigelow, Senior Staff Veterinarian, 

Surveillance, Preparedness and 

Response Services; VS, APHIS, Federal 

Building, Room 891, 210 Walnut Street, 

Des Moines, IA 50309; (515) 284–4121. 

SUPPLEMENTARY INFORMATION: 

Background 

The Animal and Plant Health 

Inspection Service (APHIS) of the 

United States Department of Agriculture 

(USDA or the Department) administers 

regulations at 9 CFR part 53 (referred to 

below as the regulations) that provide 

for the payment of indemnity to owners 

of animals that are required to be 

destroyed because of foot-and-mouth 

disease, pleuropneumonia, rinderpest, 

Newcastle disease, highly pathogenic 

avian influenza (HPAI), infectious 

salmon anemia, or any other 

communicable disease of livestock or 

poultry that, in the opinion of the 

Secretary of Agriculture, constitutes an 

emergency and threatens the U.S. 

livestock or poultry population. 

Payment for animals destroyed is based 

on the fair market value of the animals 

at the time of their destruction. 

Section 53.2 of the regulations 

authorizes the APHIS Administrator to 

cooperate with a State in the control and 

eradication of disease. Paragraph (b) of 

this section allows for the payment of 

indemnity to cover the costs for 

purchase, destruction, and disposition 

of animals and materials required to be 

destroyed because of being 

contaminated by or exposed to such 

disease. 

Section 53.3 provides for the 

appraisal of such animals and materials. 

Paragraph (a) of § 53.3 states that the 

appraisals shall be carried out by an 

APHIS employee and a representative of 

the State jointly, or, if the State 

authorities approve, by an APHIS 

employee alone. Under § 53.3(b), the 

appraisal must be based on the fair 

market value and shall be determined 

by the meat, egg production, dairy, or 

breeding value of such animals. 

Section 53.10 provides conditions 

under which payments will not be made 

on indemnity claims. Such conditions 

include, but are not limited to, 

noncompliance by the claimant with all 

quarantine requirements, as well the 

violation of laws, regulations, or 

cooperative agreements pertaining to 

movement or handling of animals by the 

animals’ owner or employee or agent. 

Payments will also be disallowed for 

claims arising out of the destruction of 

animals or materials if those animals 

and materials have not been appraised 

in accordance with part 53 or if the 

owner has not executed a written 

agreement to the appraisals. 

Highly Pathogenic Avian Influenza 

There are many strains of avian 

influenza (AI) virus that can cause 

varying degrees of clinical illness in 

poultry. AI viruses can infect chickens, 

turkeys, pheasants, quail, ducks, geese, 

and guinea fowl, as well as a wide 

variety of other birds. AI viruses can be 

classified as highly pathogenic or low 

pathogenic (LPAI) strains based on the 

severity of the illness they cause. HPAI 

is an extremely infectious and fatal form 

of the disease that, once established, can 

spread rapidly from flock to flock. 

Certain strains of AI have the potential 

to affect humans. 

The U.S. poultry industry recently 

experienced a severe outbreak of HPAI. 

The outbreak was discovered in 

December 2014 in backyard flocks in the 

Pacific Northwest, and in two 

commercial turkey and chicken flocks 

in California. As of August 2015, 21 

States had had HPAI detections in 

backyard flocks, commercial premises, 

captive wild birds, and/or wild birds. 

Established U.S. animal health policy is 

to eliminate notifiable AI virus (both 

HPAI and LPAI strains), when it is 

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6746 Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Rules and Regulations 

1To view the interim rule and the comments we 

received, go to http://www.regulations.gov/#!docket

Detail;D=APHIS-2005-0109. 

found, through depopulation (i.e., 

destruction and disposal) of affected 

poultry. APHIS, State, and local animal 

health officials euthanize poultry, clean 

and disinfect premises and equipment, 

and then test for elimination of the virus 

to ensure that farms can be safely 

restocked. 

Payment of Indemnity 

During the 2014–2015 outbreak, 

APHIS has been paying the full 

indemnity amount to the birds’ 

owners—usually the poultry company— 

with the understanding that parties that 

have entered into contracts with the 

owners to grow or care for the animals 

would then be paid by the owner in 

accordance with contractual 

agreements. During the course of 

addressing the current 2015 outbreak, 

we determined that the existing 

regulations in part 53 do not specify that 

the indemnity be split between owners 

and contractors. Since both owners and 

contractors incur losses when a flock is 

depopulated, both should be 

compensated appropriately. 

A similar gap in the regulations 

concerning the payment of indemnity 

for LPAI became an issue for APHIS 

during an outbreak of LPAI in Virginia 

in 2002. In an interim rule published in 

the Federal Register on November 4, 

2002, and effective December 9, 2002 

(67 FR 67089–67096, Docket No. 02– 

048–1), we amended the regulations to 

allow the Department to pay indemnity 

to both contract growers and owners for 

poultry destroyed because of LPAI. That 

interim rule was followed by a final rule 

that provided for LPAI indemnity 

payments to owners and contractors. 

Following approval by delegates 

during the 2004 National Poultry 

Improvement Plan (NPIP) Conference, 

APHIS amended the regulations via an 

interim rule 1 effective and published in 

the Federal Register on September 26, 

2006 (71 FR 56302–56333, Docket No. 

APHIS–2005–0109), to establish a 

voluntary control program for the H5/

H7 subtypes of LPAI under the auspices 

of the NPIP. Among other things, that 

interim rule established a new 9 CFR 

part 56 to provide for the payment of 

indemnity for costs associated with the 

eradication of H5/H7 LPAI. 

First established under that interim 

rule, § 56.8 contains conditions for 

payments to flock owners and parties 

with which the owners contracted to 

grow and care for poultry and eggs. The 

section provides a formula for the 

distribution by APHIS of LPAI 

indemnity payments between owners 

and contractors. 

Due to the absence, noted above, of a 

provision in part 53 for split indemnity 

payments prior to this interim rule, 

there was the possibility of contractors 

not being compensated for losses 

incurred as a result of our HPAI control 

efforts during the 2014–2015 outbreak. 

APHIS believes it is important to ensure 

that all participants in the poultry 

industry with a stake in the continued 

health of the U.S. poultry stock are 

compensated for costs associated with 

eradication of HPAI, as well as LPAI. In 

this interim rule, therefore, we are 

incorporating into the HPAI regulations 

in part 53 conditions from the LPAI 

regulations in § 56.8 for the splitting of 

indemnity payments between owners 

and contractors. Only those conditions 

that are applicable to HPAI will be 

incorporated into part 53. These 

conditions are contained in a new 

§ 53.11, titled ‘‘Highly pathogenic avian 

influenza; conditions for payment.’’ 

Some of the text in the new section that 

has been drawn from § 56.8 has been 

edited slightly for clarity. 

Paragraph (a) of 53.11 provides a 

formula to enable the Administrator to 

determine the share of the indemnity 

payment that should be disbursed to the 

contractor. This is a two-step process. 

The dollar value of the contract the 

owner entered into with the contractor 

will be divided by the duration of the 

contract in days as it was signed prior 

to the HPAI outbreak. The resulting 

figure will then be multiplied by the 

time in days between the date the 

contractor began to provide services 

relating to the destroyed poultry or eggs 

under the contract and the date the 

poultry or eggs were destroyed. 

Paragraph (b) states that if a contractor 

has received any payment under his or 

her contract from the owner of the 

poultry or eggs at the time the poultry 

or eggs are destroyed, the amount of 

indemnity from APHIS for which the 

contractor will be eligible will be 

reduced by the amount of the payment 

the contractor has already received from 

the owner. This provision will ensure 

that contractors will not receive 

indemnity payments that exceed the fair 

market value of the poultry or eggs. 

Under § 53.11(c), if indemnity is paid 

to a contractor, the owner of the poultry 

or eggs will be eligible to receive the 

difference between the indemnity paid 

to the contractor and the total amount 

of indemnity that may be paid for the 

poultry or eggs. This provision ensures 

that the owner will receive a fair share 

of the indemnity. 

Finally, § 53.11(d) states that if the 

Administrator determines that the 

method described in § 53.11(a) for 

determining the amount of indemnity to 

be paid to a contractor, proves to be 

impractical or inappropriate in a 

particular case, APHIS may use any 

other method that the Administrator 

deems appropriate to determine the 

amount of indemnity due a contractor. 

This paragraph provides the 

Administrator with the flexibility to 

distribute indemnity payments 

equitably between owner and contractor 

in unusual or especially complex cases. 

The above-listed conditions will 

allow contractors, as well as poultry and 

egg owners, to be compensated for 

economic losses suffered due to the 

destruction of poultry and eggs resulting 

from HPAI outbreaks. 

Prior to this interim rule, the 

regulations in part 53 covered the 

destruction and indemnification of eggs 

under the general term ‘‘materials.’’ 

APHIS has covered eggs as being 

materials. To provide greater clarity, we 

are adding references to eggs to 

§ 53.2(b), § 53.3(a), § 53.9, and § 53.10(c) 

and (d). 

We are also adding a new paragraph 

(e) to § 53.3, pertaining to the appraisal 

of the value of eggs destroyed due to 

HPAI. As is the case for the animals 

themselves, under § 53.3(e), indemnity 

payments for eggs required to be 

destroyed due to HPAI will be based on 

the fair market value of the eggs, as 

determined by an appraisal. Appraisals 

will be reported on forms furnished by 

APHIS. The amount of indemnity paid, 

together with the amount for net salvage 

the owner or contractor received, if any, 

may not exceed the appraised fair 

market value of the eggs. Salvage refers 

to any payment the owner or contractor 

may receive from a third party, such as 

a breaker facility for the eggs. Such 

facilities may purchase the eggs and 

then pasteurize them to kill the HPAI 

virus, so that the eggs can be used in 

food products. APHIS will subtract the 

amount of any such payments made to 

the owners or contractors from the 

indemnity amount paid out by APHIS. 

In addition, because § 53.4 has not 

specifically provided for the destruction 

of eggs pursuant to the eradication of 

HPAI, we are adding a new paragraph 

(b) (currently reserved) to that section. 

The paragraph states that eggs infected 

with, exposed to, or contaminated by 

HPAI shall be disposed of pursuant to 

the regulations in part 53 under the 

supervision of an APHIS employee who 

shall prepare and transmit to the 

Administrator a report identifying all 

eggs disposed thereof. 

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Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Rules and Regulations 6747 

Biosecurity 

In some instances during the 2014– 

2015 outbreak, poor biosecurity 

practices may have led to HPAI 

introduction or spread within and 

among some commercial poultry 

facilities. More specifically, as 

discussed in our July 2015 report on 

HPAI-infected flocks (https://www.

aphis.usda.gov/animal_health/animal_

dis_spec/poultry/downloads/

Epidemiologic-Analysis-June-15- 

2015.pdf), the existing level of 

biosecurity appears to have failed to 

protect layer and turkey facilities in the 

upper Midwest from HPAI. In our view, 

the biosecurity of layer, turkey, and 

broiler facilities needs to be enhanced to 

avoid future catastrophic outbreaks of 

HPAI. 

As a step toward achieving the goal of 

enhancing biosecurity, this interim rule 

requires both owners of poultry or eggs 

and contractors to provide to APHIS a 

statement that at the time of detection 

of HPAI in their facilities, they had in 

place and were following a biosecurity 

plan. Indemnity claims will be denied if 

the owner or contractor, unless 

exempted, does not provide such a 

statement. This requirement will be 

placed in a new paragraph (g) to be 

added to § 53.10, the section in part 53 

that covers claims not allowed 

Paragraph (g)(1) contains a list of 

several measures that a biosecurity plan 

should include in order to be effective 

at preventing the introduction of HPAI 

to a poultry facility. First, personnel 

working at such a facility should be 

given appropriate biosecurity training 

and should be subject to certain 

biosecurity requirements, e.g., 

showering and changing upon, or prior 

to arriving at, the facility. The 

biosecurity plan should also include 

measures to prevent HPAI introduction 

via vehicles and equipment. A ‘‘line of 

separation’’ should be maintained, 

beyond which nothing should cross that 

could introduce the virus to poultry 

houses. Measures to control wild birds, 

rodents, and insects should be 

implemented, and the facility should 

have a source of clean water. More 

detailed information regarding these 

biosecurity measures for poultry 

facilities can be found at https://iastate.

app.box.com/Biosec-Officer-InfoManual. Educational and training 

materials for poultry-industry personnel 

are available at http://www.poultry

biosecurity.org/. 

The inclusion of the measures 

discussed above in an HPAI biosecurity 

plan is supported by the findings of our 

September 2015 report on HPAIinfected flocks (https://www.aphis.usda.

gov/animal_health/animal_dis_spec/

poultry/downloads/EpidemiologicAnalysis-September2015.pdf). For 

example, in that report, statistical 

evidence was found that having visitors 

follow biosecurity protocols, such as 

changing clothes before entering a barn, 

and having premises personnel disinfect 

barn entry areas were both associated 

with a lowered risk of introducing HPAI 

to the premises. 

Under paragraph (g)(2), owners and 

contractors will be exempted from the 

requirement to submit a biosecurity 

statement if their facilities fall under 

one of the following categories: 

Premises covered under the NPIP 

regulations in 9 CFR 146.22(b) 

(commercial table-egg laying premises 

with fewer than 75,000 birds) or 

§ 146.52(b) (raised for release upland 

game bird and waterfowl premises that 

raise fewer than 25,000 birds annually) 

and premises where fewer than 100,000 

broilers or 30,000 turkeys are raised for 

meat annually. Exempting such 

facilities will allow APHIS to 

concentrate on helping large 

commercial facilities with their 

biosecurity activities. These larger 

operations were hardest hit by the 2015 

outbreak, and are in the best position to 

address biosecurity issues. More than 99 

percent of broilers are raised on farms 

with more than 100,000 birds, and 97 

percent of turkeys are raised on farms 

with more than 30,000 birds. In 

addition, the smaller facilities that we 

are exempting from the requirement are 

less likely to have HPAI outbreaks than 

are the non-exempt ones. On smaller 

facilities, birds density tends to be less 

which minimizes overall viral load. 

Additionally, if a smaller facility was 

identified with HPAI the disease is less 

likely to spread outward to other 

premises because there are fewer birds, 

vehicles, pieces of equipment, and 

employees moving onto and off of the 

smaller, exempted facilities when 

compared to the larger, non-exempted 

ones. 

To facilitate owners’ and contractors’ 

biosecurity planning, APHIS has created 

and distributed biosecurity training 

materials, which include specific 

examples of approaches to developing 

and implementing biosecurity protocols 

for the various types of commercial 

poultry operations. Further, we are 

increasing outreach to all producers— 

large, small and backyard—to educate 

them about biosecurity plans and how 

they can be implemented at the local 

level. 

APHIS is phasing in implementation 

and documentation of enhanced 

biosecurity through a biosecurity selfassessment. Initially, commercial 

poultry owners and contractors will be 

asked to voluntarily self-assess, whether 

their operations have implemented the 

measures in a general biosecurity 

checklist developed by APHIS (http://

www.uspoultry.org/animal_husbandry/

assessment.cfm). Next, each owner and/ 

or contractor should develop a riskbased, site-specific biosecurity plan that 

includes standard operating procedures 

and a site-specific checklist. This step 

will be followed by the development of 

a plan for Federal, State, or industry-led 

oversight of the biosecurity plan and a 

mechanism for verification. We 

welcome comments from the public 

regarding the development of 

procedures for the oversight and 

verification of the biosecurity plan. 

Miscellaneous 

In addition to adding the references to 

eggs to § 53.2(b), we are making a couple 

of minor edits to the paragraph for the 

sake of clarity. We are incorporating 

footnote 1 into the text and editing one 

clause of the paragraph that, as written, 

could be interpreted as referring to the 

ineligibility of the animals covered by 

the paragraph, rather than their owners, 

to receive indemnity payments. The 

clause has been revised for accuracy, 

and we have also added a reference to 

contractors, in keeping with the other 

changes we are making to part 53. 

Emergency Action 

This rulemaking is necessary on an 

emergency basis to provide timely and 

equitable compensation to owners and 

contractors for flocks destroyed due to 

the disease, which may reoccur in 2016. 

Under these circumstances, the 

Administrator has determined that prior 

notice and opportunity for public 

comment are contrary to the public 

interest and that there is good cause 

under 5 U.S.C. 553 for making this rule 

effective less than 30 days after 

publication in the Federal Register. 

We will consider comments we 

receive during the comment period for 

this interim rule (see DATES above). 

After the comment period closes, we 

will publish another document in the 

Federal Register. The document will 

include a discussion of any comments 

we receive and any amendments we are 

making to the rule. 

Executive Orders 12866 and 13563 and 

Regulatory Flexibility Act 

This interim rule has been determined 

to be significant for the purposes of 

Executive Order 12866 and, therefore, 

has been reviewed by the Office of 

Management and Budget. 

We have prepared an economic 

analysis for this interim rule. The 

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6748 Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Rules and Regulations 

2 2011 USDA Agricultural Resource Management 

Survey, Version 4. 

3USDA, NASS. Poultry Production and Value, 

2014 Summary. April 2015. 

4MacDonald, J.M. Technology, Organization, and 

Financial Performance in U.S. Broiler Production, 

EIB–126 USDA Economic Research Service. June 

2014. 

economic analysis provides a costbenefit analysis, as required by 

Executive Orders 12866 and 13563, 

which direct agencies to assess all costs 

and benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, and equity). Executive Order 

13563 emphasizes the importance of 

quantifying both costs and benefits, of 

reducing costs, of harmonizing rules, 

and of promoting flexibility. The 

economic analysis also provides an 

initial regulatory flexibility analysis that 

examines the potential economic effects 

of this rule on small entities, as required 

by the Regulatory Flexibility Act. The 

economic analysis is summarized 

below. The full analysis may be viewed 

on the Regulations.gov Web site (see 

ADDRESSES above for instructions for 

accessing Regulations.gov) or obtained 

from the person listed under FOR

FURTHER INFORMATION CONTACT. 

APHIS is amending the regulations to 

include conditions for the splitting of 

HPAI indemnity payments when 

multiple parties are involved in order to 

ensure that all parties who suffer losses 

resulting from the destruction of poultry 

or eggs due to HPAI are compensated 

and compensation is distributed to 

parties who suffer losses based on the 

terms of the contract. The vast majority 

of contracts are expected to reflect the 

relative level of inputs or investments of 

the parties who suffer losses. This 

interim rule also clarifies that APHIS 

will pay indemnity for eggs destroyed 

due to HPAI and requires owners and 

contractors, unless exempted because 

their facilities are small, to provide a 

statement that at the time of detection 

of HPAI in their facilities, they had in 

place and were following a written 

biosecurity plan to address the potential 

spread of HPAI. 

The entities affected by this interim 

rule will be U.S. facilities primarily 

engaged in breeding, hatching, and 

raising poultry for meat or egg 

production, and facilities primarily 

engaged in slaughtering poultry. There 

were about 25,000 farms categorized as 

breeding, hatching, or raising poultry for 

meat production, about 28,000 farms 

categorized as egg producers, and 517 

poultry processors in the 2012 

Agricultural Census. In particular, this 

rule will affect poultry owners and 

contractors who produce poultry under 

production contracts. It is estimated that 

97 percent of broilers were raised on 

production contract operations in 2011.2

Of the farms producing broilers and 

other meat-type chickens, about 15,350 

accounted for more than 99 percent of 

the total number of broilers sold in 2012 

according to the Agricultural Census. 

The United States is the world’s 

largest poultry producer and the secondlargest egg producer. The combined 

value of production from broilers, eggs, 

turkeys, and the value of sales from 

chickens in 2014 was $48.3 billion, up 

9 percent from $44.4 billion in 2013. Of 

the combined total, 68 percent was from 

broilers, 21 percent from eggs, 11 

percent from turkeys, and less than 1 

percent from chickens.3 Broiler 

production, valued at over 50 billion 

pounds per year, is concentrated in a 

group of States stretching from 

Delaware, south along the Atlantic coast 

to Georgia, then westward through 

Alabama, Mississippi, and Arkansas. 

The U.S. turkey industry produces over 

one-quarter of a billion birds annually. 

Production of turkeys is somewhat more 

scattered geographically than broiler 

production, with Minnesota, North 

Carolina, Missouri, Arkansas and 

Virginia the top five turkey-producing 

States. U.S. laying hen operations 

produce over 90 billion eggs annually. 

The top five egg-producing States are 

Iowa, Ohio, Pennsylvania, Indiana, and 

Texas. 

In 2014, the United States exported 

nearly 4 million metric tons (MT) of 

poultry meat valued at about $5 billion. 

The vast majority of exports consisted of 

chicken meat. Export demand for U.S. 

broiler products has fluctuated over the 

last several years because of changing 

economic conditions and currency 

exchange rates. Since the first HPAI 

findings in December 2014, a number of 

trading partners have imposed complete 

or partial bans on shipments of U.S. 

poultry and products. 

Broilers account for nearly all U.S. 

chicken consumption. Broiler 

production and processing occurs 

within highly integrated production 

systems. Owners of the processing 

facilities own, as well, the birds that are 

processed and contract with growers 

(contractors) to raise those birds before 

processing. The top 20 owners together 

accounted for 94 percent of all broilers 

produced in the United States in 2012, 

and the top 3 accounted for 49 percent. 

Expanded broiler production has been 

made possible to a large extent by the 

vertically integrated production system 

and through the use of production 

contracts. Almost all commercial 

operations raising broilers are contract 

growers.4

Under the system of production 

contracts, the contractor normally 

supplies the grow-out house with all the 

necessary heating, cooling, feeding, and 

watering systems. The contractor also 

supplies the labor needed in growing 

the birds. The owner normally supplies 

the chicks, feed, veterinary medicines 

and transportation. Contractors have 

exclusive contracts with an owner and 

receive payment for the services that 

they provide, with premiums and 

discounts tied to the efficiency with 

which feed is converted to live-weight 

broilers, the minimization of mortality, 

or the number of eggs produced. 

Specific contract terms and the period 

covered can vary. 

Embedded in the value of a bird at 

any point in time is the value of inputs 

by both parties. Contractors’ costs are 

more or less fixed and are heavily 

committed early in the production 

cycle. Investments in poultry housing 

cannot be shifted readily to other 

farming activities. 

Currently, indemnity payments go 

directly to the owner of the birds who, 

depending on the terms of the 

contractual arrangement, might or might 

not compensate the contractor. It is 

important to formalize provisions to 

share indemnity payments between 

poultry owners and contractors, both of 

whom have productive assets imbedded 

in the value of the bird. When USDA 

pays to compensate owners and 

contractors for losses, that 

compensation should be distributed to 

parties who suffer losses based on the 

terms of the contract. 

APHIS’ determination of the total 

amount of indemnity will remain the 

same under the interim rule as at 

present, based on the appraised value of 

the bird or eggs, the number of birds 

depopulated or eggs destroyed, and the 

age of the birds when depopulated. 

However, to determine the appropriate 

payment split between owner and 

contractor, APHIS may have to examine 

contract specifics on a case-by-case 

basis. This interim rule will not change 

the total amount of compensation paid 

in a given situation, but will ensure 

timely distribution of that compensation 

between the owner and contractor. This 

interim rule will benefit contractors 

who otherwise may suffer 

uncompensated economic losses from 

participating in an eradication program. 

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Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Rules and Regulations 6749 

5One hundred flocks * $8.73 = $873, 100 flocks 

* $17.45 = $1,745, 500 flocks * $8.73 = $4,365 and 

500 flocks * $17.45 = $8,725. 

To date, the generic term ‘‘materials’’ 

within the existing regulations in part 

53 has been used to provide for 

indemnification for eggs required to be 

destroyed pursuant to HPAI eradication 

efforts. This rule will specify 

appropriate references to eggs, and a 

description of the appraisal of the value 

of eggs destroyed due to HPAI to the 

regulations. The rule will therefore 

simply clarify existing practice for the 

indemnification of destroyed eggs and 

will not change the total amount of any 

compensation paid in a given future 

situation. 

The vast majority of contractors have 

some level of biosecurity in place on 

their operations. This rule will require 

large owners and contractors to provide 

a statement that a written biosecurity 

plan was in place and was followed if 

HPAI is detected at their facilities. 

There are approximately 18,900 poultry 

operations that will be subject to this 

requirement. Many operations will need 

to review their existing biosecurity 

plans, and some will need to newly 

develop plans. We estimate that the 

development of a biosecurity plan could 

cost between about $525 and $700, 

while the review of an existing plan 

could cost about $70. If 5 percent of 

producers need to newly develop 

biosecurity plans and 95 percent need to 

review existing biosecurity plans, the 

total one-time cost for all producers 

could be between $1.7 million and $1.9 

million. 

Most producers should be readily able 

to affirm that they were following a 

biosecurity plan in the case of an HPAI 

incident. We estimate that an owner or 

contractor will need at most about 0.25 

to 0.50 hours to comply with this 

affirmation requirement, at a cost of 

$8.73 to $17.45 per occurrence. The 

total cost of this affirmation requirement 

will depend on the number of producers 

affected by a given HPAI outbreak who 

submit paperwork to receive indemnity. 

If a given outbreak were to affect 100 

flocks, the total cost of this affirmation 

requirement would be from about $900 

to $1,800 and if a given outbreak were 

to affect 500 flocks, the total cost would 

be from about $4,400 to $8,800 when 

rounded up to the nearest hundred.5

It should be noted that these total cost 

estimates are limited to the cost of 

developing or reviewing biosecurity 

plans and providing a statement 

attesting that a biosecurity plan was in 

place and followed. Because this rule 

does not require the implementation of 

specific biosecurity measures, the costs 

associated with implementing new 

biosecurity measures are not included 

in these totals. We expect that most 

producers already have or will 

voluntarily adopt new biosecurity 

measures prior to the interim rule 

becoming effective. 

APHIS is distributing biosecurity 

training materials that include specific 

examples of approaches to developing 

and implementing biosecurity protocols 

for various types of commercial poultry 

operations. APHIS is phasing in 

enhanced biosecurity initially through 

voluntary self-assessments. Results of 

self-assessments in the fall of 2015 show 

that a significant majority of poultry 

producers have in place or are in the 

process of implementing a variety of 

recommended biosecurity practices. 

Development, following public input, of 

Federal, State or industry-led oversight 

and verification will follow. 

Executive Order 12372 

This program/activity is listed in the 

Catalog of Federal Domestic Assistance 

under No. 10.025 and is subject to 

Executive Order 12372, which requires 

intergovernmental consultation with 

State and local officials. (See 2 CFR 

chapter IV.) 

Executive Order 12988 

This rule has been reviewed under 

Executive Order 12988, Civil Justice 

Reform. This rule: (1) Preempts all State 

and local laws and regulations that are 

in conflict with this rule; (2) has no 

retroactive effect; and (3) does not 

require administrative proceedings 

before parties may file suit in court 

challenging this rule. 

Paperwork Reduction Act 

In accordance with section 3507(j) of 

the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.), the information 

collection and recordkeeping 

requirements included in this interim 

rule have been submitted for emergency 

approval to the Office of Management 

and Budget (OMB). When OMB notifies 

us of its decision, we will publish a 

document in the Federal Register 

providing notice of the assigned OMB 

control number. 

Please send written comments on the 

information collection and 

recordkeeping requirements included in 

this interim rule to the following 

addresses: (1) Office of Information and 

Regulatory Affairs, OMB, Attention: 

Desk Officer for APHIS, Washington, DC 

20503; and (2) Docket No. APHIS–2015– 

0061, Regulatory Analysis and 

Development, PPD, APHIS, Station 3A– 

03.8, 4700 River Road, Unit 118, 

Riverdale, MD 20737–1238. Please state 

that your comments refer to Docket No. 

APHIS–2015–0061 and send your 

comments within 60 days of publication 

of this rule. 

This interim rule establishes 

regulations to provide for the equitable 

distribution of indemnity payment to 

owners and contractors by the 

Department for the depopulation of 

poultry and destruction of eggs known 

to be infected with HPAI and to require 

that, in order to receive indemnity 

payments, owners and contractors, 

unless specifically exempted, must 

submit a statement indicating that they 

had in place and were following a 

biosecurity plan at the time of HPAI 

detection in their facilities. In addition 

to submitting the biosecurity statement, 

owners and contractors must sign a 

payment, appraisal and agreement form 

and must certify as to whether any other 

parties hold mortgages on the flock. 

This interim rule also clarifies that eggs 

are a commodity eligible for indemnity. 

We are soliciting comments from the 

public (as well as affected agencies) 

concerning our information collection 

and recordkeeping requirements. These 

comments will help us: 

(1) Evaluate whether the information 

collection is necessary for the proper 

performance of our agency’s functions, 

including whether the information will 

have practical utility; 

(2) Evaluate the accuracy of our 

estimate of the burden of the 

information collection, including the 

validity of the methodology and 

assumptions used; 

(3) Enhance the quality, utility, and 

clarity of the information to be 

collected; and 

(4) Minimize the burden of the 

information collection on those who are 

to respond (such as through the use of 

appropriate automated, electronic, 

mechanical, or other technological 

collection techniques or other forms of 

information technology; e.g., permitting 

electronic submission of responses). 

Estimate of burden: Public reporting 

burden for this collection of information 

is estimated to average 1.626 hours per 

response. 

Respondents: States; Poultry and egg 

owners and contractors. 

Estimated annual number of 

respondents: 35,925. 

Estimated annual number of 

responses per respondent: 1.9336. 

Estimated annual number of 

responses: 69,456. 

Estimated total annual burden on 

respondents: 112,950 hours. (Due to 

averaging, the total annual burden hours 

may not equal the product of the annual 

number of responses multiplied by the 

reporting burden per response.) 

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6750 Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Rules and Regulations 

Copies of this information collection 

can be obtained from Ms. Kimberly 

Hardy, APHIS’ Information Collection 

Coordinator, at (301) 851–2727. 

E-Government Act Compliance 

The Animal and Plant Health 

Inspection Service is committed to 

compliance with the E-Government Act 

to promote the use of the Internet and 

other information technologies, to 

provide increased opportunities for 

citizen access to Government 

information and services, and for other 

purposes. For information pertinent to 

E-Government Act compliance related 

to this interim rule, please contact Ms. 

Kimberly Hardy, APHIS’ Information 

Collection Coordinator, at (301) 851– 

2727. 

List of Subjects in 9 CFR Part 53 

Animal diseases, Indemnity 

payments, Livestock, Poultry and 

poultry products. 

Accordingly, we are amending 9 CFR 

part 53 as follows: 

PART 53—FOOT-AND-MOUTH 

DISEASE, PLEUROPNEUMONIA, 

RINDERPEST, AND CERTAIN OTHER 

COMMUNICABLE DISEASES OF 

LIVESTOCK OR POULTRY 

■ 1. The authority citation for part 53 

continues to read as follows: 

Authority: 7 U.S.C. 8301–8317; 7 CFR 

2.22, 2.80, and 371.4. 

■ 2. In § 53.2, paragraph (b) is revised to 

read as follows: 

§ 53.2 Determination of existence of 

disease; agreements with States. 

* * * * * 

(b) Upon agreement of the authorities 

of the State to enforce quarantine 

restrictions and orders and directives 

properly issued in the control and 

eradication of such a disease, the 

Administrator is hereby authorized to 

agree, on the part of the Department, to 

cooperate with the State in the control 

and eradication of the disease, and to 

pay 50 percent (and in the case of 

Newcastle disease or highly pathogenic 

avian influenza, up to 100 percent, and 

in the case of infectious salmon anemia, 

up to 60 percent) of the expenses of 

purchase, destruction and disposition of 

animals, eggs, and materials required to 

be destroyed because of being 

contaminated by or exposed to such 

disease: Provided, however, that if the 

animals or eggs were exposed to such 

disease prior to or during interstate 

movement and the owners or parties 

contracting with the owners to raise or 

care for the animals or eggs are not 

eligible to receive indemnity from any 

State, the Department may pay up to 

100 percent of the purchase, 

destruction, and disposition of animals, 

eggs, and materials required to be 

destroyed; Provided further, that the 

cooperative program for the purchase, 

destruction, and disposition of birds 

shall be limited to birds which are 

identified in documentation pursuant to 

Agreements between the Department 

and the particular State involved 

relating to cooperative animal 

(including poultry) disease prevention, 

control, and eradication, as constituting 

a threat to the poultry industry of the 

United States; And provided further, 

that the Secretary may authorize other 

arrangements for the payment of such 

expenses upon finding that an 

extraordinary emergency exists. 

■ 3. Section § 53.3 is amended as 

follows: 

■ a. By revising the section heading. 

■ b. In paragraph (a), by adding the 

words ‘‘or eggs’’ after the word 

‘‘Animals’’. 

■ c. By adding paragraph (e). 

The addition and revision read as 

follows: 

§ 53.3 Appraisal of animals, eggs, or 

materials. 

* * * * * 

(e) Indemnity for eggs required to be 

destroyed due to an outbreak of highly 

pathogenic avian influenza will be 

based on the fair market value of the 

eggs, as determined by an appraisal. 

Appraisals of eggs shall be reported on 

forms furnished by APHIS. The amount 

of indemnity paid, together with the 

amount for net salvage the owner or 

contractor received, if any, shall not 

exceed the appraised fair market value 

of the eggs. 

■ 4. Section 53.4 is amended as follows: 

■ a. By revising the section heading. 

■ b. By adding paragraph (b). 

The addition and revision read as 

follows: 

§ 53.4 Destruction of animals or eggs. 

* * * * * 

(b) Eggs infected with, exposed to, or 

contaminated by highly pathogenic 

avian influenza shall be disposed of 

pursuant to the regulations in this part 

under the supervision of an APHIS 

employee who shall prepare and 

transmit to the Administrator a report 

identifying all eggs disposed thereof. 

* * * * * 

■ 5. Section 53.9 is amended as follows: 

■ a. The section heading is revised. 

■ b. By adding the word ‘‘, eggs,’’ after 

the word ‘‘animals’’ each time it 

appears. 

The revision reads as follows: 

§ 53.9 Mortgage against animals, eggs, or 

materials. 

* * * * * 

■ 6. Section 53.10 is amended as 

follows: 

■ a. In paragraphs (c) and (d), by adding 

the word ‘‘, eggs,’’ after the word 

‘‘animals’’ each time it appears. 

■ b. By adding paragraph (g). 

The addition reads as follows: 

§ 53.10 Claims not allowed. 

* * * * * 

(g) The Department will not allow 

claims arising out of the destruction of 

animals or eggs destroyed due to an 

outbreak of highly pathogenic avian 

influenza unless the owner of the 

animals or eggs and any party that 

enters into a contract with the owners 

to grow or care for the poultry or eggs, 

unless exempted under paragraph (g)(2) 

of this section, provide to APHIS a 

statement that at the time of detection 

of highly pathogenic avian influenza in 

the facility, the owner and contractor (if 

applicable), had in place and was 

following a biosecurity plan. 

(1) The biosecurity plan should 

include the following: 

(i) A biosecurity training program for 

premises/farm personnel; 

(ii) Biosecurity protocols for 

personnel; 

(iii) Procedures to control wild birds, 

rodents, and insects to reduce the risk 

of introduction or spread of HPAI; 

(iv) Measures taken to prevent HPAI 

introduction via vehicles and 

equipment; 

(v) Maintenance of a line of 

separation; and 

(vi) A clean water source for the 

facility. 

(2) Owners and contractors are 

exempted from the requirements of 

paragraph (g)(1) of this section if the 

facilities where the animals or eggs are 

raised or cared for falls under one of the 

following categories: 

(i) Premises meeting the criteria of the 

National Poultry Improvement Plan 

regulations in §§ 146.22(b) or 146.52(c) 

of this chapter; 

(ii) Premises on which fewer than 

100,000 broilers are raised annually; 

and 

(iii) Premises on which fewer than 

30,000 meat turkeys are raised annually. 

* * * * * 

■ 7. Section 53.11 is added to read as 

follows: 

§ 53.11 Highly pathogenic avian influenza; 

conditions for payment. 

(a) When poultry or eggs have been 

destroyed pursuant to this part, the 

Administrator may pay claims to any 

party with whom the owner of the 

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Federal Register / Vol. 81, No. 26 / Tuesday, February 9, 2016 / Rules and Regulations 6751 

poultry or eggs has entered into a 

contract for the growing or care of the 

poultry or eggs. The indemnity the 

Administrator may pay to such a party 

or parties shall be determined as by the 

following method: 

(1) Divide the value in dollars of the 

contract the owner entered into with the 

contractor by the duration in days of the 

contract as it was signed prior to the 

highly pathogenic avian influenza 

outbreak; 

(2) Multiply this figure by the time in 

days between the date the contractor 

began to provide services relating to the 

destroyed poultry or eggs under the 

contract and the date the poultry or eggs 

were destroyed due to highly 

pathogenic avian influenza. 

(b) If a contractor receiving indemnity 

under this section has received any 

payment under his or her contract from 

the owner of the poultry or eggs at the 

time the poultry or eggs are destroyed, 

the amount of indemnity for which the 

contractor is eligible will be reduced by 

the amount of the payment the 

contractor has already received. 

(c) If indemnity is paid to a contractor 

under this section, the owner of the 

poultry or eggs will be eligible to receive 

the difference between the indemnity 

paid to the contractors and the total 

amount of indemnity that may be paid 

for the poultry or eggs. 

(d) In the event that determination of 

indemnity due a contractor using the 

method described in paragraph (a) of 

this section is determined to be 

impractical or inappropriate, APHIS 

may use any other method that the 

Administrator deems appropriate to 

make that determination. 

Done in Washington, DC, this 3rd day of 

February 2016. 

Gary Woodward, 

Deputy Under Secretary for Marketing and 

Regulatory Programs. 

[FR Doc. 2016–02530 Filed 2–8–16; 8:45 am] 

BILLING CODE 3410–34–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2016–2843; Directorate 

Identifier 2015–SW–003–AD; Amendment 

39–18392; AD 2016–03–05] 

RIN 2120–AA64 

Airworthiness Directives; Airbus 

Helicopters Deutschland GmbH 

Helicopters 

AGENCY: Federal Aviation 

Administration (FAA), Department of 

Transportation (DOT). 

ACTION: Final rule; request for 

comments. 

SUMMARY: We are superseding 

airworthiness directive (AD) 2014–13– 

01 for Airbus Helicopters Deutschland 

GmbH (Airbus Helicopters) Model 

MBB–BK 117 C–2 helicopters with a 

certain Goodrich rescue hoist damper 

unit (damper unit) installed. AD 2014– 

13–01 required repairing or replacing 

the damper unit or deactivating the 

rescue hoist. AD 2014–13–01 was 

prompted by a report of an 

uncommanded detachment of a damper 

unit from the cable. This new AD 

retains the optional requirement of 

deactivating the rescue hoist, expands 

the applicability, and requires either 

replacing or modifying the damper unit 

with a newly developed single-piece 

retainer. These actions are intended to 

prevent the hoist damper unit detaching 

from the cable resulting in loss of an 

external load or person from the 

helicopter hoist and injury to persons 

being lifted by the hoist. 

DATES: This AD becomes effective 

February 24, 2016. 

The Director of the Federal Register 

approved the incorporation by reference 

of certain documents listed in this AD 

as of February 24, 2016. 

We must receive comments on this 

AD by April 11, 2016. 

ADDRESSES: You may send comments by 

any of the following methods: 

• Federal eRulemaking Docket: Go to 

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

online instructions for sending your 

comments electronically. 

• Fax: 202–493–2251. 

• Mail: Send comments to the U.S. 

Department of Transportation, Docket 

Operations, M–30, West Building 

Ground Floor, Room W12–140, 1200 

New Jersey Avenue SE., Washington, 

DC 20590–0001. 

• Hand Delivery: Deliver to the 

‘‘Mail’’ address between 9 a.m. and 5 

p.m., Monday through Friday, except 

Federal holidays. 

Examining the AD Docket 

You may examine the AD docket on 

the Internet at http://

www.regulations.gov by searching for 

and locating Docket No. FAA–2016– 

2843; or in person at the Docket 

Operations Office between 9 a.m. and 5 

p.m., Monday through Friday, except 

Federal holidays. The AD docket 

contains this AD, the European Aviation 

Safety Agency (EASA) AD, any 

incorporated by reference service 

information, the economic evaluation, 

any comments received, and other 

information. The street address for the 

Docket Operations Office (telephone 

800–647–5527) is in the ADDRESSES

section. Comments will be available in 

the AD docket shortly after receipt. 

For service information identified in 

this final rule, contact Airbus 

Helicopters, 2701 N. Forum Drive, 

Grand Prairie, TX 75052; telephone 

(972) 641–0000 or (800) 232–0323; fax 

(972) 641–3775; or at http://www.airbus

helicopters.com/techpub. You may 

review the referenced service 

information at the FAA, Office of the 

Regional Counsel, Southwest Region, 

10101 Hillwood Pkwy., Room 6N–321, 

Fort Worth, TX 76177. 

FOR FURTHER INFORMATION CONTACT: 

David N. Hatfield, Aviation Safety 

Engineer, Safety Management Group, 

Rotorcraft Directorate, FAA, 10101 

Hillwood Pkwy., Fort Worth, TX 76177; 

telephone (817) 222–5110; email 

david.hatfield@faa.gov. 

SUPPLEMENTARY INFORMATION: 

Comments Invited 

This AD is a final rule that involves 

requirements affecting flight safety, and 

we did not provide you with notice and 

an opportunity to provide your 

comments prior to it becoming effective. 

However, we invite you to participate in 

this rulemaking by submitting written 

comments, data, or views. We also 

invite comments relating to the 

economic, environmental, energy, or 

federalism impacts that resulted from 

adopting this AD. The most helpful 

comments reference a specific portion of 

the AD, explain the reason for any 

recommended change, and include 

supporting data. To ensure the docket 

does not contain duplicate comments, 

commenters should send only one copy 

of written comments, or if comments are 

filed electronically, commenters should 

submit them only one time. We will file 

in the docket all comments that we 

receive, as well as a report summarizing 

each substantive public contact with 

FAA personnel concerning this 

rulemaking during the comment period. 

We will consider all the comments we 

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