Federal Register / Vol. 79, No. 219 / Thursday, November 13, 2014 / Rules and Regulations 67349 

assistance, unless expressly authorized 

by the terms and conditions of the 

Federal award’’. 

Response: In implementing the OMB 

Uniform Administrative Requirements, 

Cost Principles, and Audit 

Requirements for Federal Awards 

(2 CFR Chapter I, Chapter II, Parts 200, 

215, 220, 225, and 230), it is NASA 

policy to not pay profit or fee under 

grant and cooperative agreement 

awards. NASA maintains that it is 

inappropriate to pay profit and fee 

under its Federal Financial Assistance 

awards because payment in excess of 

costs is inconsistent with the intent of 

grant and cooperative agreements which 

provide funding in the form of financial 

assistance to recipients for their 

performance of a public purpose. 

III. Executive Orders 12866 and 13563 

Executive Orders (E.O.s) 12866 and 

13563 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, distributive impacts, and 

equity). E.O. 13563 emphasizes the 

importance of quantifying both costs 

and benefits, of reducing costs, of 

harmonizing rules, and of promoting 

flexibility. This is not a significant 

regulatory action and, therefore, was not 

subject to review under section 6(b) of 

E.O. 12866, Regulatory Planning and 

Review, dated September 30, 1993. This 

rule is not a major rule under 5 U.S.C. 

804. 

IV. Regulatory Flexibility Act 

NASA certifies that this final rule will 

not have a significant economic impact 

on a substantial number of small entities 

within the meaning of the Regulatory 

Flexibility Act, 5 U.S.C. 601, et seq., 

because the rule does not impose any 

additional requirements on small 

entities and currently less than 1 

percent of recipients of NASA grants 

and cooperative agreements receive 

profit or management fees. 

V. Paperwork Reduction Act 

The Paper Reduction Act (Pub. L. 

104–13) is not applicable because the 

prohibition on payment of profit and 

management fees by NASA does not 

require the submission of any 

information by recipients that requires 

the approval of the Office of 

Management and Budget under 44 

U.S.C. 3501, et seq. 

List of Subjects in 14 CFR 1260 

Colleges and universities, Business 

and Industry, Grant programs, Grants 

administration, Cooperative agreements, 

State and local governments, Non-profit 

organizations, Commercial firms, 

Recipients. 

Cynthia Boots, 

Alternate Federal Register Liaison 

Accordingly, 14 CFR Part 1260 is 

amended as follows: 

PART 1260–GRANTS AND 

COOPERATIVE AGREEMENTS 

■ 1. The authority citation for 14 CFR 

1260 continues to read as follows: 

Authority: 42 U.S.C. 2473(c)(1), Pub. L. 97– 

258, 96 Stat. 1003 (31 U.S.C. 6301, et seq.), 

and OMB Circular A–110. 

■ 2. In § 1260.4, paragraph (b)(2) is 

revised to read as follows: 

§ 1260.4 Applicability. 

* * * * * 

(b) * * * 

(2) Payment of fee or profit is 

consistent with an activity whose 

principal purpose is the acquisition of 

goods and services for the direct benefit 

or use of the United States Government, 

rather than an activity whose principal 

purpose is assistance. Therefore, the 

grants officer shall use a procurement 

contract, rather than assistance 

instrument, in all cases where fee or 

profit is to be paid to the recipient of the 

instrument or the instrument is to be 

used to carry out a program where fee 

or profit is necessary to achieving 

program objectives. Grants and 

cooperative agreements shall not 

provide for the payment of fee or profit 

to the recipient. 

* * * * * 

■ 3. In § 1260.10, paragraph (b)(1)(iv) is 

added to read as follows: 

§ 1260.10 Proposals. 

* * * * * 

(b) * * * 

(1) * * * 

(iv) Payment of fee or profit is 

consistent with an activity whose 

principal purpose is the acquisition of 

goods and services for the direct benefit 

or use of the United States Government, 

rather than an activity whose principal 

purpose is assistance. Therefore, the 

grants officer shall use a procurement 

contract, rather than assistance 

instrument, in all cases where fee or 

profit is to be paid to the recipient of the 

instrument or the instrument is to be 

used to carry out a program where fee 

or profit is necessary to achieving 

program objectives. Grants and 

cooperative agreements shall not 

provide for the payment of fee or profit 

to the recipient. 

* * * * * 

■ 4. In § 1260.14, paragraph (e) is added 

to read as follows: 

§ 1260.14 Limitations. 

* * * * * 

(e) Payment of fee or profit is 

consistent with an activity whose 

principal purpose is the acquisition of 

goods and services for the direct benefit 

or use of the United States Government, 

rather than an activity whose principal 

purpose is assistance. Therefore, the 

grants officer shall use a procurement 

contract, rather than assistance 

instrument, in all cases where fee or 

profit is to be paid to the recipient of the 

instrument or the instrument is to be 

used to carry out a program where fee 

or profit is necessary to achieving 

program objectives. Grants and 

cooperative agreements shall not 

provide for the payment of fee or profit 

to the recipient. 

[FR Doc. 2014–26856 Filed 11–12–14; 8:45 am] 

BILLING CODE 7510–13–P 

SOCIAL SECURITY ADMINISTRATION 

20 CFR Part 404 

[Docket No. SSA–2009–0038] 

RIN 096–AH03 

Revised Medical Criteria for Evaluating 

Genitourinary Disorders; Correction 

AGENCY: Social Security Administration. 

ACTION: Final rule; correction. 

SUMMARY: This document corrects a 

misspelling in the regulatory language 

of our final rulemaking published in the 

Federal Register on Friday, October 10, 

2014, titled Revised Medical Criteria for 

Evaluating Genitourinary Disorders. 

DATES: Effective December 9, 2014. 

FOR FURTHER INFORMATION CONTACT: 

Cheryl A. Williams, Office of Medical 

Policy, Social Security Administration, 

6401 Security Boulevard, Baltimore, 

Maryland 21235–6401, (410) 965–1020. 

For information on eligibility or filing 

for benefits, call our national toll-free 

number, 1–800–772–1213, or TTY 1– 

800–325–0778, or visit our Internet site, 

Social Security Online, at http://

www.socialsecurity.gov. 

SUPPLEMENTARY INFORMATION: On 

October 10, 2014 we published a final 

rulemaking in the Federal Register at 79 

FR 61221. The final rulemaking 

contained an incorrect spelling of 

exstrophic. We are correcting that 

misspelling. 


rmajette on DSK2TPTVN1PROD with RULES
67350 Federal Register / Vol. 79, No. 219 / Thursday, November 13, 2014 / Rules and Regulations 

Correction 

In final rule FR Doc 2014–24114 

published on October 10, 2014 at 79 FR 

61221, in the regulatory language 

section, make the following correction: 

Appendix 1 to Subpart P of Part 404— 

[Corrected] 

■ 1. On page 61225 in the 2nd column, 

in paragraph A of Listing 106.00 of Part 

B of Appendix 1 to Subpart P of Part 

404, correct ‘‘exotrophic’’ to read 

‘‘exstrophic’’. 

Paul Kryglik, 

Director, Office of Regulations and Reports 

Clearance, Office of Legislative and 

Congressional Affairs, Social Security 

Administration. 

[FR Doc. 2014–26745 Filed 11–12–14; 8:45 am] 

BILLING CODE 4191–02–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[TD 9701] 

RIN 1545–BK80 

Arbitrage Rebate Overpayments on 

Tax-Exempt Bonds 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Final regulations. 

SUMMARY: This document contains final 

regulations that provide guidance on the 

recovery of overpayments of arbitrage 

rebate on tax-exempt bonds and other 

tax-advantaged bonds. These final 

regulations provide the deadline for 

filing a claim for an arbitrage rebate 

overpayment and certain other rules. 

These final regulations affect issuers of 

tax-exempt and tax-advantaged bonds. 

DATES: Effective date: These regulations 

are effective on November 13, 2014. 

Applicability date: For dates of 

applicability, see § 1.148–11(l)(4). 

FOR FURTHER INFORMATION CONTACT: 

Timothy Jones at (202) 317–6980 (not a 

toll-free number). 

SUPPLEMENTARY INFORMATION: 

Background 

On September 16, 2013, the IRS 

published a Notice of Proposed 

Rulemaking (REG–148812–11) in the 

Federal Register (78 FR 56841) (the 

‘‘Proposed Regulations’’). A public 

hearing was scheduled for February 5, 

2014, but later was cancelled because no 

one requested to speak. However, two 

comments responding to the Proposed 

Regulations were received. After 

consideration of these comments, the 

Proposed Regulations are adopted as 

revised by this Treasury decision. 

Explanation of Provisions and 

Summary of Comments 

The final regulations amend the 

Income Tax Regulations (26 CFR part 1) 

on the arbitrage investment restrictions 

on tax-exempt bonds and other taxadvantaged bonds under section 148 of 

the Internal Revenue Code (Code). 

Section 1.148–3(i) of the existing 

Income Tax Regulations provides that 

an issuer may recover an overpayment 

of arbitrage rebate and similar payments 

on an issue of tax-exempt bonds if the 

issuer establishes to the satisfaction of 

the Commissioner that the overpayment 

occurred. 

Rev. Proc. 2008–37 (2008–2 CB 137) 

provides procedures for filing claims for 

the refund of arbitrage rebate and 

similar payments and imposes a 

deadline for filing such claims. In 

particular, a claim for a refund must be 

filed no later than two years after the 

final arbitrage computation date for the 

issue from which the claim arose. A 

transition rule applies to issues with a 

final computation date on or before June 

24, 2008. Like the Proposed Regulations, 

the final regulations include this twoyear limitation on filing claims as well 

as the transition rule. 

The final regulations also adopt the 

rule in the Proposed Regulations that 

the Commissioner may request 

additional information to support a 

claim, specify a date for a return of that 

information, and deny the claim if the 

information is not returned by the date 

specified in the Commissioner’s request 

or, if the Commissioner grants the issuer 

an extension to provide the information, 

by the extension date. Under both the 

Proposed Regulations and final 

regulations, if the Commissioner denies 

a claim because the Commissioner 

asserts that it was filed after the twoyear deadline or that the information 

requested by the Commissioner was not 

received by the date specified in the 

request for such additional information, 

the issuer may appeal the denial to the 

Office of Appeals. If the Office of 

Appeals concludes that the claim was 

timely filed or the requested 

information was timely submitted, as 

applicable, the case will be returned to 

the Commissioner for further 

consideration of the merits of the claim. 

The final regulations amend the 

Proposed Regulations to take into 

account a comment received suggesting 

that the Proposed Regulations be revised 

to provide a minimum time period for 

issuers to respond to any request by the 

Commissioner for additional 

information. In response to this request, 

the final regulations revise the Proposed 

Regulations to provide that issuers will 

be given at least 21 calendar days to 

respond to a request for additional 

information. The 21 day period is 

consistent with the time period 

provided by the IRS in other instances 

for submitting additional information. 

See, for example, section 8.05 of Rev. 

Proc. 2014–1, 2014–1 IRB 1, 31 

(providing taxpayers with 21 days to 

submit additional information requested 

by the IRS in connection with the 

evaluation of a letter ruling request). 

Another commenter questioned the 

Commissioner’s authority to impose the 

two-year limitation on filing of claims 

for recovery of an overpayment of 

arbitrage rebate. The commenter also 

expressed a concern that an issuer’s 

right to proceed to court could expire 

while the issuer’s claim awaits review 

by the Commissioner. 

Treasury and the IRS believe that the 

Commissioner’s authority to impose the 

two-year limitation arises from the 

broad grant of authority to prescribe 

regulations under section 148(i). In 

addition, an issuer’s right to proceed to 

court cannot expire in the manner 

suggested by the commenter because 

sections 6532 and 7422 apply to the 

recovery of arbitrage rebate 

overpayments. Under section 7422, a 

claim for the recovery of an alleged 

arbitrage overpayment cannot be filed in 

any court until a claim for such amount 

has been filed with the Secretary. Under 

section 6532, a proceeding to recover an 

alleged overpayment of arbitrage 

generally may not begin before the 

expiration of six months from the date 

the claim required by section 7422 has 

been filed with the Secretary, nor after 

the expiration of two years from the date 

the taxpayer is notified of the claim 

denial. Thus, the final regulations adopt 

the two-year limitation without change. 

Certain changes made by the final 

regulations to the procedures for 

processing arbitrage rebate overpayment 

claims are not reflected in Rev. Proc. 

2008–37. As a result, the Treasury 

Department and the IRS intend to 

publish guidance updating Rev. Proc. 

2008–37 to take into account changes 

made by the final regulations. 

Comments are requested on whether 

other changes should be made to the 

procedures as part of that guidance. 

Effective/Applicability Date 

In accordance with section 

7805(b)(1)(C) and Rev. Proc. 2008–37, 

§ 1.148–3(i)(3)(i) of the final regulations 

applies to refund claims arising from an 

issue of bonds to which § 1.148–3(i) 

applies and for which the final 


rmajette on DSK2TPTVN1PROD with RULES