Document ID: OSHA-2007-0066-0432
Agency: osha
Document Type: Proposed Rule
Title: Cranes and Derricks in Construction: Operator Certification
Posted Date: 2014-02-10T05:00Z

[Federal Register Volume 79, Number 27 (Monday, February 10, 2014)]
[Proposed Rules]
[Pages 7611-7621]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-02579]

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DEPARTMENT OF LABOR

Occupational Safety and Health Administration

29 CFR Part 1926

[Docket ID-OSHA-2007-0066]
RIN 1218-AC86

Cranes and Derricks in Construction: Operator Certification

AGENCY: Occupational Safety and Health Administration (OSHA), Labor.

ACTION: Notice of Proposed Rulemaking.

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SUMMARY: On August 9, 2010, OSHA issued a final standard establishing 
requirements for cranes and derricks used in construction work. The 
standard requires employers to ensure that crane operators are 
certified by November 10, 2014. Until that date, employers also have 
added duties under the standard to ensure that crane operators are 
trained and competent to operate the crane safely. The Agency is 
proposing to extend the deadline for operator certification by three 
years to November 10, 2017, and to extend the existing employer duties 
for the same period.

DATES: Submit comments to this proposed rule, including comments to the 
information-collection (paperwork) determination (described under the 
section titled ``Agency Determinations''), hearing requests, and other 
information by March 12, 2014. All submissions must bear a postmark or 
provide other evidence of the submission date.

ADDRESSES: Submit comments, hearing requests, and other material, 
identified by Docket No. OSHA-2007-0066, using any of the following 
methods:
    Electronically: Submit comments and attachments, as well as hearing 
requests and other information, electronically at http://www.regulations.gov, which is the Federal e-Rulemaking Portal. Follow 
the instructions online for submitting comments. Note that this docket 
may include several different Federal Register notices involving active 
rulemakings, so it is extremely important to select the correct notice 
or its ID number when submitting comments for this rulemaking. After 
accessing the docket (OSHA-2007-0066), check the ``proposed rule'' box 
in the column headed ``Document Type,'' find the document posted on the 
date of publication of this document, and click the ``Submit a 
Comment'' link. Additional instructions for submitting comments are 
available from the regulations.gov homepage.
    Facsimile: OSHA allows facsimile transmission of comments that are 
10 pages or fewer in length (including attachments). Fax these 
documents to the OSHA Docket Office at (202) 693-1648. OSHA does not 
require hard copies of these documents. Instead of transmitting 
facsimile copies of attachments that supplement these documents (e.g., 
studies, journal articles), commenters must submit these attachments to 
the OSHA Docket Office, Technical Data Center, Room N-2625, OSHA, U.S. 
Department of Labor, 200 Constitution Ave. NW., Washington, DC 20210. 
These attachments must clearly identify the sender's name, the date, 
subject, and the docket number (OSHA-2007-0066) so that the Docket 
Office can attach them to the appropriate document.
    Regular mail, express delivery, hand delivery, and messenger 
(courier) service: Submit comments and any additional material to the 
OSHA Docket Office, RIN No. 1218-AC86, Technical Data Center, Room N-
2625, OSHA, U.S. Department of Labor, 200 Constitution Ave. NW., 
Washington, DC 20210; telephone: (202) 693-2350. (OSHA's TTY number is 
(877) 889-5627). Contact the OSHA Docket Office for information about 
security procedures concerning delivery of materials by express 
delivery, hand delivery, and messenger service. The Docket Office will 
accept deliveries (express delivery, hand delivery, messenger service) 
during the Docket Office's normal business hours, 8:15 a.m. to 4:45 
p.m., e.t.
    Instructions: All submissions must include the Agency's name, the 
title of the rulemaking (Cranes and Derricks in Construction: Operator 
Certification), and the docket number (i.e., OSHA Docket No. OSHA-2007-
0066). OSHA will place comments and other material, including any 
personal information, in the public docket without revision, and the 
comments and other material will be available online at http://www.regulations.gov. Therefore, OSHA cautions commenters about 
submitting statements they do not want made available to the public, or 
submitting comments that contain personal information (either about 
themselves or others) such as Social Security numbers, birth dates, and 
medical data.

[[Page 7612]]

    Docket: To read or download comments or other material in the 
docket, go to http://www.regulations.gov or to the OSHA Docket Office 
at the above address. The electronic docket for this proposed rule 
established at http://www.regulations.gov lists most of the documents 
in the docket. However, some information (e.g., copyrighted material) 
is not available publicly to read or download through this Web site. 
All submissions, including copyrighted material, are available for 
inspection at the OSHA Docket Office. Contact the OSHA Docket Office 
for assistance in locating docket submissions.

FOR FURTHER INFORMATION CONTACT:
    General information and press inquiries: Mr. Frank Meilinger, OSHA 
Office of Communications, Room N-3647, U.S. Department of Labor, 200 
Constitution Avenue NW., Washington, DC 20210; telephone: (202) 693-
1999; email: Meilinger.Francis2@dol.gov.
    Technical inquiries: Mr. Vernon Preston, Directorate of 
Construction, Room N-3468, OSHA, U.S. Department of Labor, 200 
Constitution Avenue NW., Washington, DC 20210; telephone: (202) 693-
2020; fax: (202) 693-1689; email: Preston.Vernon@dol.gov.
    Copies of this Federal Register notice and news releases: 
Electronic copies of these documents are available at OSHA's Web page 
at http://www.osha.gov.

SUPPLEMENTARY INFORMATION:

I. Summary and Explanation of the Proposed Amendments to the Standard

A. Introduction

    OSHA is publishing this Notice of Proposed Rulemaking to extend for 
three years the employer duty to ensure crane operator competency for 
construction work, from November 10, 2014, to November 10, 2017. OSHA 
also is proposing to extend the enforcement date for crane operator 
certification for three years from November 10, 2014, to November 10, 
2017. After publishing the final rule for cranes and derricks in 
construction, several entities informed OSHA that crane operator 
certification was insufficient for determining whether an operator 
could operate their equipment safely on a construction site. After 
hosting several public meetings discussing this issue, OSHA decided to 
propose extending the enforcement date for: The employer to ensure 
competent and safe crane operation; and operator certification. During 
the three-year extension, OSHA will examine and determine how to 
address this issue systematically.

B. Summary of Economic Impact

    This proposed rule is not economically significant. OSHA proposes 
to revise 29 CFR 1926.1427(k) (competency assessment and training) to 
extend the deadline for compliance with the operator-certification 
requirement in its construction standard for cranes and derricks, and 
to extend the existing employer duties for the same period. OSHA's 
preliminary economic analysis shows that extending the date for 
operator certification and employers' assessment of crane operators, 
rather than allowing both provisions to expire on November 10, 2014, 
will result in a net cost savings for the affected industries. 
Extending the compliance date for operator certification results in 
estimated cost savings that exceed the estimated new costs for 
employers to continue to assess crane operators to ensure their 
competent operation of the equipment in accordance with 1926.1427(k). 
The detailed preliminary economic analysis is in the ``Agency 
Determinations'' section of this preamble.

C. Background

1. Operator Certification Options
    OSHA developed the final rule for cranes and derricks in 
construction (29 CFR subpart CC, referred to as ``the cranes standard'' 
hereafter) through a negotiated rulemaking process. OSHA established a 
federal advisory committee, the Cranes and Derricks Negotiated 
Rulemaking Advisory Committee (C-DAC), to develop a draft proposed 
rule. C-DAC met in 2003 and 2004 and developed a draft proposed rule 
that it provided to OSHA. The rule that OSHA subsequently proposed 
closely followed C-DAC's draft proposal (73 FR 59718).
    The Agency initiated a Small Business Advocacy Review Panel in 
2006. The Agency published the proposed rule for cranes in construction 
in 2008, received public comment on the proposal, and conducted a 
public hearing. OSHA's final rule incorporated, with minor changes, the 
four-option scheme C-DAC recommended and the Agency proposed. 
Accordingly, in Sec.  1926.1427, OSHA requires employers to ensure that 
their crane operators are certified under at least one of four options 
by November 10, 2014. The four options are:
    Option 1. Certification by an independent testing organization 
accredited by a nationally recognized accrediting organization;
    Option 2. Qualification by an employer's independently audited 
program;
    Option 3. Qualification by the U.S. military; or
    Option 4. Compliance with qualifying state or local licensing 
requirements.
    The third-party certification option in Sec.  1926.1427(b)--Option 
1--is the only certification option that is ``portable,'' meaning that 
any employer who employs an operator may rely on that operator's 
certification as evidence of compliance with the cranes standard's 
operator certification requirement. This certification option also is 
the only one that is available to all employers; it is the option that 
OSHA, and the parties that participated in the rulemaking, believed 
would be the one most widely used. In this regard, OSHA is not aware of 
an audited employer qualification program among construction industry 
employers (Option 2), and the cranes standard limits the U.S. military 
crane operator certification programs (Option 3) to federal employees 
of the Department of Defense or the armed services. While state and 
local governments certify some crane operators (Option 4), the vast 
majority of operators who become certified do so through Option 1--by 
third-party testing organizations accredited by a nationally recognized 
accrediting organization.
    Under Option 1, a third party performs testing. Before a testing 
organization can issue operator certifications, paragraph 1427(b)(1) of 
the cranes standard provides that a nationally recognized accrediting 
organization must accredit the testing organizations. To accredit a 
testing organization, the accrediting agency must determine that the 
testing organization meets industry-recognized criteria for written 
testing materials, practical examinations, test administration, 
grading, facilities and equipment, and personnel. The testing 
organization must administer written and practical tests that:
     Assess the operator's knowledge and skills regarding 
subjects specified in the cranes standard;
     provide different levels of certification based on 
equipment capacity and type;
     have procedures to retest applicants who fail; and
     have testing procedures for recertification.
    Paragraph 1427(b)(2) of the final cranes standard also specifies 
that, for the purposes of compliance with the cranes standard, an 
operator is deemed qualified to operate a particular piece of equipment 
only if the operator is certified for that type and capacity of 
equipment or for higher-capacity equipment of that type. It further 
provides that, if no testing organization

[[Page 7613]]

offers certification examinations for a particular equipment type and/
or capacity, the operator is deemed qualified to operate that equipment 
if the operator is certified for the type/capacity of equipment that is 
most similar to that equipment, and for which a certification 
examination is available.
2. Overview of Sec.  1926.1427(k) (Phase-In Provision)
    The final cranes standard replaced provisions in 29 CFR 1926 
subpart N--Cranes, Derricks, Hoists, Elevators, and Conveyors, of the 
construction safety standards. Provisions for employers to ensure that 
operators of equipment, including cranes, are trained and qualified to 
safely operate that equipment are available elsewhere in the 
construction safety standards (see, for example, Sec.  1926.20(b)(4) 
and (f)(2)).
    OSHA delayed the effective date of the operator certification 
requirement for four years, until November 10, 2014 (see Sec.  
1427(k)(1)). The Agency also wanted to ensure the final cranes standard 
maintained an employer duty during that four-year ``phase-in'' period 
to ensure that crane operators could safely operate equipment (see 
Sec.  1926.1727(k), Phase-in.). Thus, pursuant to Sec.  
1926.1427(k)(2)(i), OSHA required employers to ``ensure that operators 
of equipment covered by this standard are competent to operate the 
equipment safely.'' Under Sec.  1926.1427(k)(2)(ii), employers must 
train and evaluate the operator when the operator ``assigned to operate 
machinery does not have the required knowledge or ability to operate 
the equipment safely''.
3. Post-Final Rule Developments
    After OSHA issued the final rule, it continued to receive feedback 
from members of the regulated community and conducted stakeholder 
meetings on April 2 and 3, 2013, to give interested members of the 
public the opportunity to express their views. Participants included 
construction contractors, labor unions, crane manufacturers, crane 
rental companies, accredited testing organizations, one of the 
accrediting bodies, insurance companies, crane operator trainers, and 
military employers. Detailed notes of participants' comments are 
available at http://www.osha.gov/cranes-derricks/stakeholders.html and 
OSHA-2013-0024-0001. Various parties informed OSHA that, in their 
opinion, the operator certification option would not adequately ensure 
that crane operators could operate their equipment safely at a 
construction site. They said that a certified operator would need 
additional training, experience, and evaluation, beyond the training 
and evaluation required to obtain certification, to ensure that he or 
she could operate a crane safely.
    OSHA also received information that two (of a total of four) 
accredited testing organizations have been issuing certifications only 
by ``type'' of crane, rather than by the ``type and capacity'' of 
crane, as the cranes standard requires. As a result, those 
certifications do not meet the standard's requirements and operators 
who obtained certifications from those organizations cannot, under 
OSHA's cranes standard, operate cranes on construction sites after 
November 10, 2014. Some stakeholders in the crane industry requested 
that OSHA remove the capacity requirement.
    Most of the participants in the stakeholder meetings expressed the 
opinion that an operator's certification by an accredited testing 
organization did not mean that the operator was fully competent or 
experienced to operate a crane safely on a construction work site. The 
participants likened operator certification to a new driver's license, 
or a beginner's permit, to drive a car. Most participants said that the 
operator's employer should retain the responsibility to ensure that the 
operator was qualified for the particular crane work assigned. Some 
participants wanted certification to be, or viewed to be, sufficient to 
operate a crane safely. Stakeholders noted that operator certification 
was beneficial in establishing a minimum threshold of operator 
knowledge and familiarity with cranes.

D. Explanation of Proposed Action and Request for Comment

    The effective dates of the operator certification requirement and 
the other ``phase-in'' employer duties are in 29 CFR 1926.1427(k)(1). 
The Agency is proposing to revise Sec.  1427(k)(1) to extend the 
deadline for operator certification by three years from November 10, 
2014, to November 10, 2017, to provide additional time for the Agency 
to consider potential rulemaking options. The Agency also is proposing 
to extend the current employer duties in Sec.  1926.1427(k)(2)(i) and 
(ii) to ensure that there is no reduction in worker protection during 
this three-year period. When OSHA included these employer duties in the 
final cranes standard in 2010, these duties were to be a ``phase in'' 
to certification (75 FR 48027). By extending the date as proposed in 
this notice, the requirements would continue to serve that purpose and 
preserve the status quo.\1\
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    \1\ A parallel training requirement in Sec.  1430(c)(2) 
reiterates the training requirement in paragraph 1427(k)(2), 
specifying that the training occur during the four-year transition 
period. OSHA is not proposing to amend Sec.  1430(c)(2) because it 
believes that amending Sec.  1427(k)(2) is sufficient to extend the 
relevant employer training duty for employers; however, the Agency 
welcomes comment on this issue.
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    As discussed later in this preamble, the Advisory Committee on 
Construction Safety and Health (ACCSH) recommended postponing 
certification indefinitely pending further rulemaking and also 
recommended continuing the existing employer duties for that same 
period. OSHA seeks comment on this alternative; however, the Agency 
believes that an indefinite extension would result in complacency in 
the regulated community because employers may assume that operator 
certification is not important. Moreover, if the Agency extends the 
certification deadline indefinitely, it could face additional 
procedural hurdles in reinstituting the certification requirement, 
rather than having those requirements take effect automatically at the 
end of a fixed period.
    By extending the enforcement dates by three years, the Agency will 
have about four years to pursue and complete rulemaking. The Agency is 
proposing a three-year extension, rather than a shorter period, to give 
it sufficient time to complete a rulemaking should it choose to do so. 
The Agency is confident that it can complete a subsequent rulemaking by 
November, 2017, because: (1) This issue is critical to construction 
safety and the effectiveness of the final cranes standard, which OSHA 
previously estimated would prevent 22 fatalities per year (75 FR 
47914), and (2) OSHA expects that a subsequent rulemaking would focus 
on a limited number of discrete issues already debated extensively by 
stakeholders in the regulated community.
    OSHA seeks comment on this approach, including the duration (three 
years) of the proposed extension of the operator certification deadline 
and the existing employer duties, as well as the alternative approach 
recommended by the ACCSH. OSHA encourages commenters to include a 
rationale for any alternatives that they propose. In addition, OSHA 
requests comment, data, or information on the potential safety impact 
of extending operator certification and the current employer duty--or 
any alternatives. OSHA requests comment on the ``Agency

[[Page 7614]]

Determinations'' section that follows, including the preliminary 
economic analysis, paperwork requirements, and other regulatory impacts 
of this rule on the regulated community.

II. Agency Determinations

A. Preliminary Economic Analysis and Regulatory Flexibility Analysis

    When it issued the final cranes rule, OSHA prepared a final 
economic analysis (FEA) as required by the Occupational Safety and 
Health Act of 1970 (OSH Act; 29 U.S.C. 651 et seq.) and Executive 
Orders 12866 (58 FR 51735) (Sept. 30, 1993) and 13563 (76 FR 3821 (Jan. 
21, 2011)). OSHA also published a Final Regulatory Flexibility Analysis 
as required by the Regulatory Flexibility Act (5 U.S.C. 601-612). This 
preliminary economic analysis (PEA) uses some estimates from these 
documents.
    Because OSHA estimates that this proposed rule will have a cost 
savings for employers of $21.4 million per year for the three years of 
the proposed extension, this proposed rule is not economically 
significant within the meaning of Executive Order 12866, or a major 
rule under the Unfunded Mandates Reform Act or Section 804 of the Small 
Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et 
seq.). In addition, this proposed rule complies with Executive Order 
13563.
    This PEA focuses solely on costs, and not on any changes in safety 
and benefits resulting from extending the certification deadline and 
the employer duties under Sec.  1427(k)(2). OSHA previously provided 
its assessment of the benefits of the cranes standard in the FEA of 
that standard. As noted elsewhere in this preamble, the primary 
rationale for proposing the extension is to provide additional time for 
OSHA to consider the potential costs and benefits of possible 
adjustments to the operator certification requirements in future 
rulemaking.
    Extending the employer's requirement to ensure an operator's 
competency during this period means continuing measures in existence 
since publishing the final crane standard in 2010. As OSHA stated in 
the preamble to the final rule, the interim measures in paragraph (k) 
``are not significantly different from requirements that were effective 
under subpart N of this part at former Sec.  1926.550, Sec.  
1926.20(b)(4) (`the employer shall permit only those employees 
qualified by training or experience to operate equipment and 
machinery'), and Sec.  1926.21(b)(2) (`the employer shall instruct each 
employee in the recognition and avoidance of unsafe conditions . . 
.')'' (75 FR 48027).
    Delaying the operator certification requirement defers a regulatory 
requirement and should impose no new costs on employers. There would, 
however, be continuing employer costs for extending the requirement to 
assess operators under existing Sec.  1926.1427(k)(2); if OSHA does not 
extend these requirements, they would expire in 2014 and employers 
would not incur these costs after 2014. With the extension, these 
continuing employer costs would be offset by a reduction in expenses 
that employers would otherwise incur to ensure that their operators are 
certified before the existing November 2014 deadline.
Overview
    In the following analysis, OSHA examined costs and savings to 
determine the net economic effect of the proposed rule. By comparing 
the additional assessment costs to the certification cost savings 
across two scenarios--a scenario in which there is no extension of the 
2014 deadline, and a scenario in which there is an extension until 
2017--OSHA estimates a net savings for employers of $21.4 million per 
year, annualized over the 3-year period of the proposed extension using 
a 7% interest rate ($19.5 million per year using an interest rate of 
3%).\2\
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    \2\ As explained in the following discussion, OSHA typically 
calculates the present value of future costs and benefits using two 
interest rate assumptions, 7% and 3%, as recommended by OMB Circular 
A-4 of September 17, 2003.
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    OSHA's analysis follows the steps below to reach its estimate of an 
annual net $21.4 million in savings:
    (1) Estimate the annual assessment costs for employers;
    (2) Estimate the annual certification costs for employers; and
    (3) Estimate the year-by-year cost differential if OSHA extends the 
certification deadline to 2017.\3\
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    \3\ For convenience, OSHA refers to the annual time period as a 
``Certification Year'' (CY) in this economic analysis, which OSHA 
defines as beginning November 10 of the calendar year; e.g., CY 2013 
runs from November 10, 2013, to November 9, 2014. There is some 
small variation in both assessment and certification costs across 
CYs due to changes in the composition of the operator pool resulting 
from turnover (discussed below). In this regard, OSHA presents CY 
2013 costs in full, and then presents the minor adjustments needed 
for other CYs.
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Table 1 below summarizes these costs and the differentials. In a 
separate analysis, OSHA examined the cost differential under an 
alternative to the proposal in which the Agency delays indefinitely the 
certification deadline and employer-assessment phase out.
a. Annual Assessment Costs
    OSHA estimated the annual assessment costs using the following 
three steps: First, determine the unit costs of meeting this 
requirement; second, determine the number of assessments that employers 
will need to perform the assessments in any given year (this 
determination includes estimating the affected operator pool as a 
preliminary step); and finally, multiply the unit costs of meeting the 
requirement by the number of operators who must meet it in any given 
year to determine the annual costs.
    Unit assessment costs. OSHA's unit cost estimates for assessments 
take into account the time needed for the assessment, along with the 
wages of both the operator and the specialized operator assessor who 
will perform the assessment. OSHA based the time requirements on crane 
operator certification exams currently offered by nationally accredited 
testing organizations. OSHA determined the time needed for various 
certification tests from informal conversations the Agency had with 
industry sources who participated in the public stakeholder meetings. 
OSHA invites comment on these estimates.
    The Agency estimates separate assessment costs for three types of 
affected operators, which together include all affected operators: 
Those who have a certificate that is in compliance with the existing 
cranes standard; those who have a certificate from a nationally 
accredited testing organization that is not in compliance with the 
existing cranes standard; and those who have no certificate.\4\ OSHA 
uses certification status as a proxy of competence in estimating the 
amount of assessment time needed for different operators. OSHA expects 
that an operator already certified to operate equipment of a particular 
type and capacity will require less assessment time than an operator 
certified by type but not capacity, who in turn will require less time 
than an operator who is not certified. In deriving these estimates, 
OSHA determined that operators who have a certificate that is compliant 
with the cranes standard would have to complete a test that is 
equivalent of the practical part of the standard crane operator test. 
The

[[Page 7615]]

Agency estimates that it would take an operator one hour to complete 
this test. Operators who have a certificate that is not in compliance 
with the cranes standard would have to complete a test that is 
equivalent to both a written general test and a practical test of the 
standard crane operator test. OSHA estimated that the written general 
test would take 1.5 hours to complete, for a total test time of 2.5 
hours of testing for each operator (1.5 hours for the written general 
test and 1.0 hour for the practical test). Finally, operators with no 
certificate would have to complete a test that is equivalent to the 
written test on a specific crane type of the standard crane operator 
test (also lasting 1.5 hours), as well as the written general test and 
the practical test, for a total test time of 4.0 hours (1.5 hours for 
the test on a specific crane type, 1.5 hours for the written general 
test, and 1.0 hour for the practical test).
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    \4\ OSHA is not making any determination about whether a 
specific certification complies with the requirements of the cranes 
standard. For the purposes of this analysis only, OSHA will treat 
certificates that do not include a capacity component as not 
complying with the cranes standard, and certificates that include 
both a type and capacity component as complying with the cranes 
standard.
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    The wages used for the crane operator and assessor come from the 
final cranes rule (75 FR 48102). Accordingly, the operator wage is 
$35.62, while the wage of the assessor is estimated to be the same as 
the wage of a crane inspector, $41.25. For assessments performed by an 
employer of a prospective employee (i.e., a candidate), OSHA used these 
same operator and assessor wages and the above testing times to 
estimate the cost of assessing prospective employees.
    Multiplying the wages of operators, assessors, and candidates by 
the time taken for each type of assessment provides the cost for each 
type of assessment. Hence, the cost of assessing an operator already 
holding a certificate that complies with the standard (both type and 
capacity) is one hour of both the operator's and assessor's time: 
$76.87 ($35.62 + $41.25). For an operator with a certificate for crane 
type only (not crane capacity), the assessment time is 2.5 hours for a 
cost of $192.18 (2.5 x ($35.62 + $41.25)). Finally, for an operator 
with no certificate, the assessment time is 4.0 hours for a cost of 
$307.48 (4.0 x ($35.62 + $41.25)).
    Besides these assessment costs, OSHA notes that Sec.  
1427(k)(2)(ii) requires employers to provide training to employees if 
they are not already competent to operate their assigned equipment. To 
determine whether an operator is competent, the employer must first 
perform an assessment. Only if an operator fails the assessment will 
the operator require training. However, in determining this cost, OSHA 
made a distinction between a nonemployee candidate for an operator 
position and an operator who is currently an employee. For an employer 
assessing a nonemployee candidate, OSHA assumed, based on common 
industry practice, that the employer will not hire a nonemployee 
candidate who fails the assessment. In the second situation, an 
employee qualified to operate a crane fails a type and/or capacity 
assessment for a crane that differs from the crane the employee 
currently operates. In this situation, the cost-minimizing action for 
the employer is not to assign the employee to that type and/or capacity 
crane, thereby avoiding training costs. While the Agency acknowledges 
that there will be cases in which the employer will provide this 
training, it believes these costs to be minimal and, therefore, is not 
taking costs for the training.
    Number of assessments and number of affected operators. The number 
of assessments is difficult to estimate due to the heterogeneity of the 
crane industry. Many operators work continuously for the same employer, 
already have their assessment, and do not need reassessment, so the 
number of new assessments required by the cranes standard for these 
operators will be zero. Some crane companies will rent both a crane and 
an operator employed by the rental company to perform crane work, in 
which case the rental crane company is the operator's employer and 
responsible for operator assessment. In such cases there is no need for 
the contractor who is renting the crane service to conduct an 
additional operator assessment. Assuming that employers already comply 
with the assessment and training requirements of the existing Sec.  
1427(k)(2), employers only need to assess a subset of operators: New 
hires; employees who will operate equipment that differs by type and/or 
capacity from the equipment on which they received their current 
assessment; and operators who indicate that they no longer possess the 
required knowledge or skill necessary to operate the equipment.
    To calculate the estimated annual number of assessments, OSHA first 
estimated the current number of crane operators affected by the cranes 
standard. The FEA in the final cranes standard identified a total of 
142,630 affected crane operators (75 FR 48108). However, after 
publishing the final cranes standard, OSHA made revisions to the cranes 
standard that reduced the total number of affected operators. In this 
regard, OSHA excluded a significant percentage of digger-derrick use 
from the scope of the cranes standard (see Cranes and Derricks in 
Construction: Revising the Exemption for Digger Derricks, 78 FR 32110 
(May 29, 2013)). Accordingly, for electric power generation and 
transmission work covered by the digger-derrick exemption, OSHA found 
that the two industries using digger derricks have a total of 25,500 
operators for both digger derrick and other covered equipment; these 
industries are: Electric Power Generation, NAICS: 221110; and Electric 
Power Transmission, NAICS: 221120; see 78 FR 32114). Subtracting these 
digger-derrick operators from the original total leaves the total 
number of operators affected by this proposal at 117,130 (i.e., 
142,630-25,500).
    For the purpose of determining the number of assessments required 
each year under this proposal, OSHA is relying on the original 23% 
turnover rate for operators identified in the 2008 PEA for the cranes 
rule (73 FR 59895), which includes all types of operators who would 
require assessment: Operators moving between employers; operators 
moving between different types and/or capacities of equipment; and 
operators entering the occupation. OSHA estimated that 26,940 
assessments occur each year based on turnover (i.e., 117,130 operators 
x 0.23 turnover rate). This number includes assessments performed by an 
employer on current employees assigned to a new type and/or capacity 
crane. In addition, OSHA in the 2008 PEA assumed that 15% of operators 
involved in assessments related to turnover would fail the first test 
administration and need reassessment (73 FR 59895). Therefore, in this 
proposal, OSHA is adding 4,041 reassessments (i.e., 26,940 operators x 
0.15) to the number of reassessments resulting from turnover, for a 
total of 30,981 yearly assessments resulting from turnover and test 
failure (i.e., 26,940 + 4,041).
    Annual assessment costs. Annual assessment costs will vary by year 
depending on several factors; the following section addresses year-by-
year variations. However, OSHA must first determine the annual base 
amount from which to account for the variations, and must do so for the 
two scenarios: (1) Retaining the deadline specified by the existing 
cranes standard (status quo); and (2) extending the deadline to 2017 
(proposed rule).
    The first part of the calculation is the same under both scenarios. 
Because the annual assessment costs vary by the different levels of 
assessment required (depending on the operator's existing level of 
certification), OSHA grouped the 117,130 operators subject to the 
cranes standard into three classifications: Operators with a 
certificate that complies with the standard; operators with a 
certificate only for crane type; and operators with

[[Page 7616]]

no certification. From discussions with members of the crane industry, 
OSHA estimated that 15,000 crane operators currently have a certificate 
that complies with the existing cranes standard, and another 60,000 
have a certificate for crane type only (but not capacity). Therefore, 
42,130 crane operators have no crane certification (i.e., 117,130 total 
operators-(15,000 operators with compliant certification + 60,000 
operators with certification for type)).
    Assuming the turnover rate of 23% and the failure rate of 15% for 
turnover-related assessments are distributed proportionally across the 
three types of operators, then the number of assessments for operators 
with compliant certification is 3,968 (i.e., (0.23 + (0.23 x 0.15)) x 
15,000), the number of assessments for operators with type-only 
certification is 15,870 (i.e., (0.23 + (0.23 x 0.15)) x 60,000), and 
the number of assessments for operators with no certification is 11,143 
(i.e., (0.23 + (0.23 x 0.15)) x 42,130). Under scenario 2 (employer-
assessment requirement extended to 2017), OSHA estimated the CY 2013 
costs by multiplying the assessment numbers for each type of operator 
by the unit costs, resulting in a cost of $6,781,167 (i.e., ($76.87 x 
3,968) + ($192.18 x 15,870) + ($307.48 x 11,143)). Under scenario 1, 
employers would be certifying operators throughout CY 2013, whereas 
under scenario 2 employers would be deferring the certifications until 
CY 2016; as a result, the CY 2013 assessment costs for scenario 1 would 
decrease from $6,781,167 to $4,581,334 because a percentage of the 
operators under scenario 1 will obtain a compliant certificate before 
they are assessed, thereby reducing the time and cost needed for the 
assessment (see discussion of year-by-year cost differential in section 
c below for more details about this determination).
b. Annual Certification Costs
    OSHA estimated the annual certification costs using the three steps 
used for estimating annual assessment costs: First, determine the unit 
costs of meeting this requirement; second, determine the number of 
affected operators; and, finally, multiply the unit costs of meeting 
the requirement by the number of operators who must meet them. For the 
proposed extension, OSHA estimated that almost all certification will 
occur in the year prior to the deadline. OSHA notes that although the 
current November 2014 deadline is just over a year away, there is 
evidence that the vast majority of operators do not yet have 
certification that is in compliance with the existing standard. Based 
upon this evidence, if OSHA extends the existing requirements to 
November 2017, OSHA estimates that the vast majority of employers will 
again wait until the year before the deadline (i.e., CY 2016) to 
certify all operators. As in the annual assessment-cost analysis 
described above, OSHA provides the calculations for CY 2013 under the 
2014 deadline specified by the existing cranes standard (scenario 1), 
and then presents the certification costs for CY 2016 that would apply 
if OSHA extends the certification requirement to November 2017 
(scenario 2).
    Unit certification costs. Unit certification costs vary across the 
three different types of operators in the operator pool (operators with 
compliant certification; operators with type-only certification; and 
operators with no certification). Among operators without certification 
there is a further distinction with different unit certification costs: 
Experienced operators without certification and operators who have only 
limited experience. Therefore, there are different unit certification 
costs for four different types of operators. There also are ongoing 
certification costs due to the following three conditions: The five-
year limit on operator certification; the need for some certified 
operators to obtain additional certification to operate a crane that 
differs by type and/or capacity from the crane on which they received 
their current assessment; and a yearly 5% turnover rate (i.e., 5% new 
crane operators entering the occupation to replace operators leaving 
the occupation).
    OSHA estimated these different unit certification costs using 
substantially the same unit-cost assumptions from the FEA. In the FEA, 
OSHA estimated that training and certification costs for an operator 
with only limited experience would consist of $1,500 for a 2-day course 
(including tests) and 18 hours of the operator's time, for a total cost 
of $2,141.16 (i.e., $1,500 + (18 hours x $35.62)) (see 75 FR 48096). 
OSHA continues to use a cost of $250 for the tests taken without any 
training (a constant fixed fee irrespective of the number of tests (75 
FR 48096)), and the same number of hours used for each test that it 
used in the assessment calculations provided above (which the Agency 
based on certification test times). Accordingly, OSHA estimated the 
cost of a certificate compliant with the standard for an operator who 
has a type-only certificate to be $339.05 (i.e., 1 type/capacity-
specific written test at 1.5 hours and 1 practical test at 1.0 hours 
(2.5 hours total), plus the fixed $250 fee for the tests (i.e., (2.5 
hours x $35.62) + $250). For an experienced operator with no 
certificate, the cost is $392.48 (i.e., the same as the cost for an 
operator with a type-only certificate plus the cost of an added general 
written test of 1.5 hours (i.e., (4.0 hours x $35.62) + $250).\5\
---------------------------------------------------------------------------

    \5\ There are no certification costs for operators who already 
have a certificate that complies with the cranes standard.
---------------------------------------------------------------------------

    The cranes standard under Option 1 (the standard case) of Sec.  
1926.1427(b)(4) specifies that a certificate is valid for five years. 
OSHA estimates the recertification unit cost would be the same as the 
assessment for an operator with compliant certification (i.e., $76.87).
    Finally, there will be certified operators who must obtain 
certification when assigned to a crane that differs by type and/or 
capacity from the crane on which they received their current 
assessment. This situation requires additional training, but less 
training than required for a ``new'' operator with only limited 
experience. Accordingly, OSHA estimated the cost for these operators as 
one half of the cost of training and certifying a new operator, or 
$1,070.08 (i.e., $2,141.16 / 2).
    Number of certifications. After establishing the unit certification 
costs, OSHA had to determine how many certifications are necessary to 
ensure compliance with OSHA's standard. In doing so, the Agency uses 
the 5% new-hire estimate from the FEA discussed above to calculate the 
number of new operators; therefore, of the 117,130 operators affected 
by the proposed standard, 5,857 (i.e., 0.05 x 117,130) would be new 
operators who would require two days for training and certification 
each year. As discussed earlier, OSHA estimated that 60,000 operators 
have type-only certification, and 15,000 operators have certification 
that complies with the existing cranes standard. The remaining 36,274 
operators (i.e., 117,130 - (60,000 + 15,000 + 5,857)) are experienced 
operators without certification.
    After all operators attain certification by the proposed deadline, 
there will still be ongoing certification costs each year. OSHA 
estimated that 5% of all operators each year, or 5,857 (i.e., .05 x 
117,130), are new operators with no experience or certification and, 
therefore, will need an initial certification. Consequently, with a 
constant total number of operators, the same number of operators 
(5,857) will be leaving the occupation each year and will not require 
recertification when

[[Page 7617]]

their current 5-year certification ends. This leaves 111,274 operators 
(i.e., 117,130 - 5,857) who will need such periodic recertification. If 
we approximate the timing of requirements for recertification as 
distributed proportionally across years, then 20% of all operators with 
a 5-year certificate (i.e., 22,255 operators (.20 x 111,274)) would 
require recertification each year. A final category of unit 
certification costs involves the continuing need for certified 
operators to obtain further certification when assigned to a crane that 
differs by type and/or capacity from the crane on which they received 
their current assessment. This situation arises for both operators 
working for a single employer and operators switching employers. The 
23% turnover rate from the cranes PEA covers pre-deadline situations in 
which an operator needs an assessment, and also situations in the post-
deadline period in which an operator needs multiple certifications. The 
operators requiring assessments in the pre-deadline period who will not 
need additional certification in the post-deadline period are operators 
with certification who move to a new employer and operate a crane with 
the same type and capacity as the crane on which they received 
certification from their previous employer. These operators will not 
need reassessment because of the portability of an operator certificate 
across employers specified by the cranes standard (see Sec.  
1427(b)(3)). For an employer looking to hire an operator for a specific 
crane, this option will minimize cost, and OSHA assumes employers will 
choose this option when possible.
    After the certification deadline, OSHA estimates that each year 23% 
of the 117,130 operators (26,940, i.e., 0.23 x 117,130) will enter the 
workforce, change employers, or take on new positions that require one 
or more additional certifications to operate different types and/or 
capacities of cranes. Of these 26,940 operators, OSHA estimates that 5% 
of that turnover, or 5,857 ((i.e., 0.05 x 117,130), will result from 
new operators entering the occupation each year; 9%, or 10,542 (i.e., 
0.09 x 117,130), will result from operators switching employers but 
operating a crane of the same type and capacity as the crane they 
operated previously (i.e., no certification needed because 
certification is portable in this case); and the remaining 9%, or 
10,542, changing jobs or positions and requiring one or more additional 
certification to operate a crane that differs by type and/or capacity 
from the crane they operated previously.
    Annual certification costs. As with the assessment costs, 
certification costs will vary by year depending on several factors 
addressed in the following section. However, OSHA still needs to 
determine the annual base amount from which to account for the 
variations, and must do so for the same two scenarios: (1) Retaining 
the deadline specified by the existing cranes standard (status quo); 
and (2) extending the deadline to 2017 (proposed rule).
    To estimate the annual base cost for the first scenario, OSHA 
calculates the certification costs for CY 2013 because that is the 
remaining period before the deadline specified by the existing cranes 
standard. The total cost for certifying all operators in CY 2013 in 
accordance with the existing cranes standard using the above unit-cost 
estimates and numbers of operators is $47,119,327 (i.e., (60,000 
operators with type-only certification x $339.05) + (36,274 experienced 
operators without certification x $392.48) + (5,857 operators with no 
experience or certification x $2,141.16)). The Agency, following the 
FEA (75 FR 48096), annualized this cost for the five-year period during 
which operator certification remains effective, resulting in an 
annualized cost of $8,433,648. In section c below, OSHA uses this 
amount in calculating the annual certification costs under scenario 1.
    To determine the annual amount used in calculations for the second 
scenario (the proposed extension to 2017), OSHA examines the costs in 
CY 2016 because that is the first year with certification costs (as 
noted earlier, OSHA determined that, under the proposed extension, 
employers will postpone certification costs until CY 2016, so there 
will not be any new certification costs for CY 2013-2015). Using the 
same methodology used to calculate the CY 2013 certification costs, the 
total cost for having all crane operators certified in CY 2016 is 
$48,416,216 (in 2016 dollars). The annualized cost over the five-year 
period during which certification remains effective is $8,749,948. In 
the following section, OSHA uses this amount in calculating the annual 
certification costs under scenario 2.
c. Year-by-Year Cost Differential If OSHA Extends the Certification 
Deadline to 2017
    The ultimate goal of this analysis is to determine the annual cost 
differential between scenario 1 (the status quo) and scenario 2 (the 
proposed rule), so the final part of this PEA compares the yearly 
assessment and certification costs employers will incur for the two 
scenarios. Because the assessment and certification costs change each 
year under each scenario, OSHA must compare the cost differential in 
each year separately to determine the annual cost savings for each year 
attributable to adopting scenario 2. OSHA calculated the present value 
of each year's differential, which provides a consistent basis for 
comparing the cost differentials over the extended compliance period. 
OSHA then annualized the present value of each differential to identify 
an annual amount that accounts for the discounted costs over this 
period. Table 1 below summarizes these calculations.
    Table 1 shows that assessment and certification costs vary each 
year under scenario 2. There are several factors that cause these costs 
to vary: (1) The five-year limit on operator certification causes some 
operators to require recertification during this period; (2) the need 
for some certified operators to obtain additional certification to 
operate a crane that differs by type and/or capacity from the crane on 
which they received their current assessment; and (3) the yearly 5% 
turnover that results in new crane operators entering the occupation. 
In addition, the composition of the operator pool will shift in the 
year before the deadline because a higher share of all operators will 
have certification. This shift would decrease the need to perform a 
longer and more costly assessment, thereby reducing the high costs 
associated with operators who do not have certification (i.e., 
employers would take less time assessing operators with compliant 
certification in this certification year compared to years in which 
there is no deadline). To account for this effect, OSHA adjusted 
assessment costs in the year directly preceding the deadline in each 
scenario (i.e., CY 2013 for scenario 1 and CY 2016 for scenario 2).
    Accordingly, OSHA determined that assessment costs for CY 2013 
under the first scenario would decrease from $6,781,167 under scenario 
2 to $4,581,334 under scenario 1 because of the increasing 
certification effect that occurs near the deadline.\6\ A similar

[[Page 7618]]

calculation for CY 2016 (the year prior to the proposed certification 
deadline in 2017) lowers the estimated assessment costs from $7.2 
million (in the absence of the deadline and accompanying certification) 
to $4.8 million under scenario 2.
---------------------------------------------------------------------------

    \6\ OSHA estimates that operators will obtain their compliant 
certification at a uniform rate throughout the certification year 
immediately preceding the deadline, which implies that certification 
costs can be estimated by using a weighted average of the unit costs 
if no operators become compliant certified, and the unit costs if 
all operators are so certified, with equal weight attributed to each 
condition (i.e., each condition (no operators and all operators) 
contributing one half to the estimate). The Agency then values 
assessment unit costs as if none of the operators had certification, 
which would result in maximum assessment times, with unit costs 
determined by total costs divided by total assessments, which is 
$218.18 (i.e., $6,781,167 total assessment cost / 30,981 total 
yearly assessments). OSHA next values unit assessment costs as if 
all operators had compliant certification, which would require the 
shortest assessment time of 1 hour, and a cost of $76.87. The ratio 
of the second unit assessment cost to the first unit assessment cost 
is .35 ($76.87 / $218.88). Therefore, the resulting assessment cost 
in CY 2013 using the weighted average formula is $4,581,334 (i.e., 
(0.5 x $6,781,167) + (0.5 x 0.35 cost ratio x $6,781,167).
---------------------------------------------------------------------------

    One-time costs for certifying operators with non-compliant 
certification ($20,343,000) and certifying experienced operators with 
no certification ($14,236,623) account for much of the rise in 
certification costs in CY 2013 under scenario 1. OSHA annualized these 
one-time operator certification costs across CY 2013-2017 (matching the 
5-year duration of the certifications received in the last year before 
the deadline), resulting in an annualized cost of $8,433,648 for each 
year of this five-year period under scenario 1.\7\ Under scenario 2, 
the corresponding annualized certification costs for CY 2016-2020 
(again matching the 5-year duration of the certifications received in 
the last year before the deadline) would be $8,749,948. The 
certification costs vary in the other (pre-deadline) years depending on 
factors identified earlier in this PEA.
---------------------------------------------------------------------------

    \7\ Under scenario 1, therefore, the total certification costs 
of $33,969,804 for each year over CY2014-2017 consist of the 
annualized cost of $8,433,648 for the one-time operator 
certification costs and $25,536,156 for fixed costs involving 
recertification of compliant operators, additional certifications 
for operators changing type or capacity of crane, and certification 
of new operators.
---------------------------------------------------------------------------

    As noted earlier, OSHA estimated the overall cost differential 
between these two scenarios by calculating the difference in total 
(assessment and certification) costs each year across the two 
scenarios. The net employer cost savings in current dollars 
attributable to adopting the second scenario are, for each 
certification year: 2013, $18.8 million; 2014, $27.1 million; 2015, 
$26.9 million; 2016, $7.9 million; 2017, -$0.3 million; 2018, -$8.7 
million; 2019, -$8.7 million; and 2020, -$8.7 million.\8\
---------------------------------------------------------------------------

    \8\ A positive cost differential indicates net savings and a 
negative cost differential indicates net costs. Savings in earlier 
years results largely from the extension of the certification 
deadline. The cost differential then turns negative in later years 
largely because employers complete certification under the first 
scenario while they are just beginning certification under the 
second scenario.
    By 2017, under both scenarios all existing operators will have 
compliant certification. However, under the second scenario, the 
five-year annualization of when certification costs are incurred 
would continue until 2020. Hence, 2021 is the first year when, under 
both scenarios, employer costs would consist solely of ongoing 
certification costs, and the cost differential between the two 
scenarios would be zero. The ongoing certification costs consist of: 
the yearly cost resulting from new operators (5% of all operators) 
entering the operator pool; the proportion of the pool that must 
receive recertification each year resulting from expiration of the 
five-year certification; and the annual additional certifications 
that occur.

                                                   Table 1--Year-by-Year Cost Differential if OSHA Extends the Certification Deadline to 2017
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        2013          2014          2015          2016          2017          2018          2019          2020          2021
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                           Operator Pool
 
Scenario 1 (no deadline extension):
    Operators with type-only certification........................        60,000             0             0             0             0             0             0             0             0
    Operators with complaint certification........................        15,000       111,274       111,274       111,274       111,274       111,274       111,274       111,274       111,274
    Operators with no certification...............................        36,274             0             0             0             0             0             0             0             0
    New operators.................................................         5,857         5,857         5,857         5,857         5,857         5,857         5,857         5,857         5,857
Scenario 2 (deadline extension):
    Operators with type-only certification........................        60,000        57,000        54,150        51,443             0             0             0             0             0
    Operators with compliant certification........................        15,000        14,250        13,538        12,861       111,274       111,274       111,274       111,274       111,274
    Operators with no certification...............................        36,274        40,024        43,586        46,970             0             0             0             0             0
    New operators.................................................         5,857         5,857         5,857         5,857         5,857         5,857         5,857         5,857         5,857
 
                               Costs
Scenario 1 (no deadline extension):
    Total assessment costs........................................    $4,581,334             0             0             0             0             0             0             0             0
    Total certification costs.....................................    20,973,352   $33,969,804   $33,969,804   $33,969,804   $33,969,804   $25,536,156   $25,536,156   $25,536,156   $25,536,156
                                                                   -----------------------------------------------------------------------------------------------------------------------------
        Total.....................................................    25,554,686    33,969,804    33,969,804    33,969,804    33,969,804    25,536,156    25,536,156    25,536,156    25,536,156
                                                                   =============================================================================================================================
Scenario 2 (deadline extension):
    Total assessment costs........................................     6,781,167     6,918,409     7,048,788     4,777,075             0             0             0             0             0
    Total certification costs.....................................             0             0             0    21,289,651    34,286,103    34,286,103    34,286,103    34,286,103    25,536,156
                                                                   -----------------------------------------------------------------------------------------------------------------------------
        Total.....................................................     6,781,167     6,918,409     7,048,788    26,066,726    34,286,103    34,286,103    34,286,103    34,286,103    25,536,156
                                                                   =============================================================================================================================
Cost Differential (Scenario 2 - Scenario 1).......................  (18,773,519)  (27,051,395)  (26,921,015)   (7,903,078)       316,299     8,749,948     8,749,948     8,749,948             0
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: OSHA, ORA Calculations.

    OSHA next determined the present value of these cost differentials 
between the two scenarios. OSHA calculated the present value of future 
costs using two interest rates assumptions, 7% and 3%, which are the 
rates OSHA used in the FEA of the cranes standard (75 FR 48080), and 
which follow the OMB guidelines specified by Circular A-4 of September 
17, 2003. At an interest rate of 7%, the present value of the cost 
differentials for CY 2013 onwards results in an estimated savings of 
$56.3 million ($55.2 million using the 3% rate). Finally, annualizing 
the present value over the proposed three-year extension period results 
in an annualized cost differential (i.e., net employer cost savings) of 
$21.4 million per year ($19.5 million per year using the 3% rate).
d. Alternative: Indefinite Extension of the Certification Deadline
    As noted above, ACCSH recommended that OSHA extend indefinitely the 
deadline for operator certification and the employer duties under Sec.  
1427(k)(2). OSHA is requesting comment on this alternative, and is 
providing the following analysis of potential employer costs and 
savings under this alternative. Based on the calculations described 
above, cost savings under this alternative would be larger than the 
cost savings under the proposed 2017 extension because there would be 
no rise in certification costs later in the extension period.
    This alternative would result in an indefinite extension of 
employer assessments and associated costs. Assuming that no operator 
would have any type of certification, all assessments would involve the 
4-hour assessment at a cost of $307.48. Thus, using the same estimates 
of 23% turnover and a 15% failure rate described above, the yearly

[[Page 7619]]

assessment costs would be $9,526,003 (0.23 x 1.15 x 117,130 x $307.48) 
for this alternative.
    While assessment costs would disappear after the deadline under any 
scenario with a specified certification deadline, there will still be 
annual ongoing employer certification costs for new operators, as well 
as recertifications and additional certifications for operators 
previously certified. As noted earlier, total yearly ongoing 
certification costs consist of: 5% new operators each year with 
certification costs of $2,141.16 for each operator, or $12,539,704 
total (0.05 x 117,130 x $2,141.16); recertification of 20% of the 
previously certified operator pool at a cost of $76.87 for each 
operator, or $1,710,719 total (0.20 x 0.95 x 117,130 x $76.87); and 9% 
of the operator pool getting additional certification at a unit cost of 
$1,070.58 for each operator, or $11,285,733 total (0.09 x 117,130 x 
$1,070.58). Adding these costs, the grand total each year post-deadline 
for scenarios with specified certification deadlines is $25,536,156 
($12,539,704 + $1,710,719 + $11,285,733). Hence, even without 
considering the upfront costs of having all current operators certified 
to the standard, postponing the certification deadline indefinitely 
would result in a net yearly savings of $16,010,153 ($25,536,156 - 
$9,526,003) each year. Therefore, the ACCSH-recommended alternative 
would increase cost savings by removing the additional cost associated 
with having to fully certify, and maintain certification for, the total 
operator pool by a specified deadline.
e. Certification of No Significant Impact on a Substantial Number of 
Small Entities
    Because the Agency estimates the cost of any single assessment to 
be no higher than $307.48, it believes the economic impact would be 
minimal on any employer. Most employers would have savings resulting 
from the three-year extension, particularly employers that planned to 
pay for operator certification in the year before the deadline 
specified by the existing cranes standard. The only entities likely to 
see a net cost would be entities that planned to hire an operator with 
compliant certification after November 10, 2014. Without the proposed 
extension, these entities would have no separate assessment duty, but 
under the proposed extension they would have the expense involved in 
assessing operator competency. As noted above, however, OSHA estimated 
the cost for such assessments (for operators with a type and capacity 
certification) to be $76.87 per certified operator.
    Small businesses would, by definition, have few operators, and OSHA 
believes the $76.78 cost would be well below 1% of revenues, and well 
below 5% of profits, in any industry sector using cranes. OSHA does not 
consider such small amounts to represent a significant impact on small 
businesses in any industry sector. Hence, OSHA certifies this proposed 
rule would not have a significant impact on a substantial number of 
small entities. OSHA invites comments on this certification and the 
underlying rationale.

B. Paperwork Reduction Act of 1995

    When OSHA issued the final rule on August 9, 2010, it submitted an 
Information Collection Request (ICR) to the Office of Management and 
Budget (OMB) titled Cranes and Derricks in Construction (29 CFR Part 
1926, Subpart CC).\9\ On November 1, 2010, OMB approved the ICR under 
OMB Control Number 1218-0261, with an expiration date of November 30, 
2013. Subsequently, in December 2010, OSHA discontinued the Cranes and 
Derricks Standard for Construction (29 CFR 1926.550) ICR (OMB Control 
Number 1218-0113) because the new ICR superseded the existing ICR. In 
addition, OSHA retitled the new ICR to Cranes and Derricks in 
Construction (29 CFR Part 1926, Subpart CC and Subpart DD).\10\
---------------------------------------------------------------------------

    \9\ The ICR is available at ID-0425 at www.regulations.gov and 
at www.reginfo.gov (OMB Control Number 1218-0261).
    \10\ The request and OMB approval for discontinuing the previous 
Cranes and Derricks in Construction ICR (OMB Control Number 1218-
0113) and the retitling of the ICR are available at www.reginfo.gov.
---------------------------------------------------------------------------

    This proposed rule requires no additional collection of 
information. OMB's approval of OSHA's ICR under Control Number 1218-
0261 already covers all collections of information required by this 
proposed rule, and OSHA does not believe it is necessary to submit a 
new ICR to OMB seeking to collect additional information under this 
proposed rule.
    Interested parties who comment on OSHA's determination that this 
proposal contains no additional paperwork requirements must send their 
written comments to the Office of Management and Budget, Attn: OMB Desk 
Officer for OSHA, Room 10235, 726 Jackson Place NW., Washington, DC 
20503. OSHA also encourages commenters to submit their comments on this 
paperwork determination to it, along with their other comments on the 
proposed rule.
    OSHA notes that a Federal agency cannot conduct or sponsor a 
collection of information unless OMB approves it under the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3501 et seq.), and the agency displays 
a currently valid OMB control number. The public need not respond to a 
collection of information requirement unless the agency displays a 
currently valid OMB control number, and, notwithstanding any other 
provision of law, no person shall be subject to a penalty for failing 
to comply with a collection of information requirement if the 
requirement does not display a currently valid OMB control number.

C. Federalism

    OSHA reviewed this proposed rule in accordance with the Executive 
Order on Federalism (Executive Order 13132, 64 FR 43255, August 10, 
1999), which requires that Federal agencies, to the extent possible, 
refrain from limiting state policy options, consult with states prior 
to taking any actions that would restrict state policy options, and 
take such actions only when clear constitutional authority exists and 
the problem is national in scope. Executive Order 13132 provides for 
preemption of state law only with the expressed consent of Congress. 
Federal agencies must limit any such preemption to the extent possible.
    Under Section 18 of the Occupational Safety and Health Act of 1970 
(OSH Act; 29 U.S.C. 651 et seq.), Congress expressly provides that 
states and U.S. territories may adopt, with Federal approval, a plan 
for the development and enforcement of occupational safety and health 
standards. OSHA refers to such states and territories as ``State Plan 
States.'' Occupational safety and health standards developed by State 
Plan States must be at least as effective in providing safe and 
healthful employment and places of employment as the Federal standards. 
29 U.S.C. 667. Subject to these requirements, State Plan States are 
free to develop and enforce under state law their own requirements for 
safety and health standards.
    OSHA previously concluded from its analysis that promulgation of 
subpart CC complies with Executive Order 13132 (75 FR 48128-29). In 
states without an OSHA-approved State Plan, any standard developed from 
this proposed rule would limit state policy options in the same manner 
as every standard promulgated by OSHA. For State Plan States, Section 
18 of the OSH Act, as noted in the previous paragraph,

[[Page 7620]]

permits State-Plan States to develop and enforce their own cranes 
standards provided these requirements are at least as effective in 
providing safe and healthful employment and places of employment as the 
requirements specified in this proposal.

D. State Plan States

    When Federal OSHA promulgates a new standard or more stringent 
amendment to an existing standard, State Plan States must amend their 
standards to reflect the new standard or amendment, or show OSHA why 
such action is unnecessary, e.g., because an existing state standard 
covering this area is ``at least as effective'' as the new Federal 
standard or amendment (29 CFR 1953.5(a)). The state standard must be at 
least as effective as the final Federal rule. State Plan States must 
adopt the Federal standard or complete their own standard within six 
months of the promulgation date of the final Federal rule. When OSHA 
promulgates a new standard or amendment that does not impose additional 
or more stringent requirements than an existing standard, State Plan 
States do not have to amend their standards, although OSHA may 
encourage them to do so. The 21 states and 1 U.S. territory with OSHA-
approved occupational safety and health plans are: Alaska, Arizona, 
California, Hawaii, Indiana, Iowa, Kentucky, Maryland, Michigan, 
Minnesota, Nevada, New Mexico, North Carolina, Oregon, Puerto Rico, 
South Carolina, Tennessee, Utah, Vermont, Virginia, Washington, and 
Wyoming. Connecticut, Illinois, New Jersey, New York, and the Virgin 
Islands have OSHA-approved State Plans that apply to state and local 
government employees only.
    When OSHA promulgates a new final rule, states and territories with 
approved State Plans must adopt comparable amendments to their 
standards for cranes and derricks within six months of OSHA's 
promulgation of the final rule unless they demonstrate that such a 
change is not necessary because their existing standards are already 
the same, or at least as effective, as OSHA's new final rule.
    The proposed amendments to OSHA's cranes standard preserve the 
status quo and would not impose any new requirements on employers. 
Accordingly, State Plan States would not have to amend their standards 
to delay the effective date of their operator certification 
requirements, but they may do so if they so choose. However, if they 
choose to delay the effective date of their certification requirements, 
they also would need to include a corresponding extension of the 
employer duty to assess and train operators that is equivalent to Sec.  
1427(k)(2).

E. Unfunded Mandates Reform Act

    When OSHA issued the final rule for cranes and derricks in 
construction, it reviewed the rule according to the Unfunded Mandates 
Reform Act of 1995 (UMRA; 2 U.S.C. 1501 et seq.) and Executive Order 
13132 (64 FR 43255 (Aug. 10, 1999). OSHA concluded that the final rule 
did not meet the definition of a ``Federal intergovernmental mandate'' 
under the UMRA because OSHA standards do not apply to state or local 
governments except in states that voluntarily adopt State Plans. OSHA 
further noted that the rule imposed costs of over $100 million per year 
on the private sector and, therefore, required review under the UMRA 
for those costs, but that its final economic analysis met that 
requirement.
    As discussed above in Section IV.A (Preliminary Economic Analysis 
and Regulatory Flexibility Analysis) of this preamble, this proposed 
rule does not impose any costs on private-sector employers beyond those 
costs already taken into account in the final rule for cranes and 
derricks in construction. Because OSHA reviewed the total costs of this 
final rule under the UMRA, no further review of those costs is 
necessary. Therefore, for the purposes of the UMRA, OSHA certifies that 
this proposed rule does not mandate that state, local, or tribal 
governments adopt new, unfunded regulatory obligations, or increase 
expenditures by the private sector of more than $100 million in any 
year.

F. Consultation and Coordination With Indian Tribal Governments

    OSHA reviewed this proposed rule in accordance with Executive Order 
13175 (65 FR 67249) and determined that it does not have ``tribal 
implications'' as defined in that order. As proposed, the rule does not 
have substantial direct effects on one or more Indian tribes, on the 
relationship between the Federal government and Indian tribes, or on 
the distribution of power and responsibilities between the Federal 
government and Indian tribes.

G. Consultation With the Advisory Committee on Construction Safety and 
Health

    Under 29 CFR parts 1911 and 1912, OSHA must consult with the 
Advisory Committee on Construction Safety and Health (ACCSH or 
Committee), established pursuant to Section 107 of the Contract Work 
Hours and Safety Standards Act (40 U.S.C. 3701 et seq.), in setting 
standards for construction work. Specifically, Sec.  1911.10(a) 
requires the Assistant Secretary to provide the ACCSH with a draft 
proposed rule (along with pertinent factual information) and give the 
Committee an opportunity to submit recommendations. See also Sec.  
1912.3(a) (``[W]henever occupational safety or health standards for 
construction activities are proposed, the Assistant Secretary [for 
Occupational Safety and Health] shall consult the Advisory 
Committee''). Accordingly, the ACCSH met on May 23, 2013, and discussed 
OSHA's proposal to delay the crane operator certification deadline and 
extend the existing employer duties to assess and train crane operators 
pursuant to Sec.  1926.1427(k).
    During the ACCSH deliberations, one member of the ACCSH recommended 
extending the compliance date for qualification/certification 
indefinitely until OSHA completed a rulemaking on crane operator 
qualification. This member noted that extending the compliance date by 
three years would lead to new uncertainty, and not provide sufficient 
time for OSHA to complete a rulemaking that would clarify the 
responsibility of both crane operators and their employers (OSHA 2013-
0006-0024, 133-134). Other members of the ACCSH agreed that it would be 
better to extend the compliance date indefinitely, allow OSHA to 
address the issue of crane operator qualification, and then establish a 
new compliance date for the industry once new guidance is in place 
(OSHA-2013-0006-0024, 136-137).
    The ACCSH passed a motion recommending that OSHA suspend the 
operator certification requirement until OSHA completes a rulemaking on 
crane operator qualification, and require employers to continue to 
comply with the existing ``phase-in'' employer duties in Sec.  
1926.1427 during the same period (OSHA-2013-0006-0025, 30-31). (See 
OSHA's discussion of the ACCSH's motion under section I.D (Explanation 
of Proposed Action and Request for Comment) of this preamble.)

H. Legal Considerations

    The purpose of the Occupational Safety and Health Act of 1970 (29 
U.S.C. 651 et seq.) is ``to assure so far as possible every working man 
and woman in the nation safe and healthful working conditions and to 
preserve our human resources.'' 29 U.S.C. 651(b). To achieve this goal, 
Congress authorized the Secretary of Labor to promulgate and enforce 
occupational safety and health standards. 29 U.S.C. 654(b), 655(b). A

[[Page 7621]]

safety or health standard is a standard ``which requires conditions, or 
the adoption or use of one or more practices, means, methods, 
operations, or processes, reasonably necessary or appropriate to 
provide safe or healthful employment or places of employment.'' 29 
U.S.C. 652(8). A standard is reasonably necessary or appropriate within 
the meaning of Section 652(8) when a significant risk of material harm 
exists in the workplace and the standard would substantially reduce or 
eliminate that workplace risk. See Industrial Union Department, AFL-CIO 
v. American Petroleum Institute, 448 U.S. 607 (1980). In the cranes 
rulemaking, OSHA made such a determination with respect to the use of 
cranes and derricks in construction (75 FR 47913, 47920-21). This 
proposed rule does not impose any new requirements on employers. 
Therefore, this proposal does not require an additional significant 
risk finding (see Edison Electric Institute v. OSHA, 849 F.2d 611, 620 
(D.C. Cir. 1988)).
    In addition to materially reducing a significant risk, a safety 
standard must be technologically feasible. See UAW v. OSHA, 37 F.3d 
665, 668 (D.C. Cir. 1994). A standard is technologically feasible when 
the protective measures it requires already exist, when available 
technology can bring the protective measures into existence, or when 
that technology is reasonably likely to develop (see American Textile 
Mfrs. Institute v. OSHA, 452 U.S. 490, 513 (1981); American Iron and 
Steel Institute v. OSHA, 939 F.2d 975, 980 (D.C. Cir. 1991)). In the 
2010 Final Economic Analysis for the cranes standard, OSHA found the 
standard to be technologically feasible (75 FR 48079). This proposed 
rule would, therefore, be technologically feasible as well because it 
would not require employers to implement any additional protective 
measures; it would simply extend the duration of existing requirements.

List of Subjects in 29 CFR Part 1926

    Construction industry, Cranes, Derricks, Occupational safety and 
health, Safety.

Authority and Signature

    David Michaels, Ph.D., MPH, Assistant Secretary of Labor for 
Occupational Safety and Health, U.S. Department of Labor, 200 
Constitution Ave. NW., Washington, DC 20210, authorized the preparation 
of this notice. OSHA is issuing this proposed rule under the following 
authorities: 29 U.S.C. 653, 655, 657; 40 U.S.C. 3701 et seq.; 5 U.S.C. 
553; Secretary of Labor's Order No. 1-2012 (77 FR 3912, Jan. 25, 2012); 
and 29 CFR part 1911.

    Signed at Washington, DC, on February 3, 2014.
David Michaels,
Assistant Secretary of Labor for Occupational Safety and Health.

Amendments to Standards

    For the reasons stated in the preamble of this proposed rule, OSHA 
proposes to amend 29 CFR part 1926 as follows:

PART 1926--[AMENDED]

Subpart CC--Cranes and Derricks in Construction

0
1. The authority citation for subpart CC of 29 CFR part 1926 continues 
to read as follows:

    Authority:  40 U.S.C. 3701 et seq.; 29 U.S.C. 653, 655, 657; and 
Secretary of Labor's Orders 5-2007 (72 FR 31159) or 1-2012 (77 FR 
3912), as applicable; and 29 CFR part 1911.

0
2. In Sec.  1926.1427, revise paragraph (k) to read as follows:

Sec.  1926,1427  Operator qualification and certification.

* * * * *
    (k) Phase-in. (1) The provisions of this section became applicable 
on November 8, 2010, except for paragraphs (a)(2) and (f) of this 
section, which are applicable November 10, 2017.
    (2) When paragraph (a)(1) of this section is not applicable, all of 
the requirements in paragraphs (k)(2)(i) and (ii) of this section apply 
until November 10, 2017.
    (i) The employer must ensure that operators of equipment covered by 
this standard are competent to operate the equipment safely.
    (ii) When an employee assigned to operate machinery does not have 
the required knowledge or ability to operate the equipment safely, the 
employer must train that employee prior to operating the equipment. The 
employer must ensure that each operator is evaluated to confirm that 
he/she understands the information provided in the training.

[FR Doc. 2014-02579 Filed 2-7-14; 8:45 am]
BILLING CODE 4510-26-P