Document ID: FERC-2010-1696-0001
Agency: ferc
Document Type: Notice
Title: Agency Information Collection Activities; Proposals, Submissions, and Approvals
Posted Date: 2010-11-22T05:00Z

[Federal Register Volume 75, Number 224 (Monday, November 22, 2010)]
[Notices]
[Pages 71097-71101]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-29304]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. IC10-919-001]

Commission Information Collection Activities (FERC-919); Comment 
Request; Submitted for OMB Review

November 12, 2010.
AGENCY: Federal Energy Regulatory Commission.

ACTION: Notice.

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SUMMARY: In compliance with the requirements of section 3507 of the 
Paperwork Reduction Act of 1995, 44 U.S.C. 3507, the Federal Energy 
Regulatory Commission (Commission or FERC) has submitted the 
information collection described below to the Office of Management and 
Budget (OMB) for review and renewal. Any interested person may file 
comments directly with OMB and should address a copy of those comments 
to the Commission as explained below. The Commission issued a Notice in 
the Federal Register (75FR 41840, 07/19/2010) requesting public 
comments on renewing this information collection. FERC received one 
comment on the FERC-919 from Edison Electric Institute (EEI) and has 
made this notation in its submission to OMB.

DATES: Further comments on this collection of information are due by 
December 22, 2010.

ADDRESSES: Address further comments on this collection of information 
to the Office of Management and Budget, Office of Information and 
Regulatory Affairs, Attention: Federal Energy Regulatory Commission 
Desk Officer. Comments to OMB should be filed electronically, c/o 
oira__submission@omb.eop.gov and include OMB Control Number 1902-0234 
for reference. The Desk Officer may be reached by telephone at 202-395-
4638.
    A copy of the comments should also be sent to the Federal Energy 
Regulatory Commission and should refer to Docket No. IC10-919-001. 
Comments may be filed either electronically or in paper format. Those 
persons filing electronically do not need to make a paper filing. 
Documents filed electronically via the Internet must be prepared in an 
acceptable filing format and in compliance with the Federal Energy 
Regulatory Commission submission guidelines. Complete filing 
instructions and acceptable filing formats are available at http://www.ferc.gov/help/submission-guide.asp. To file the document 
electronically, access the Commission's Web site and click on Documents 
& Filing, E-Filing (http://www.ferc.gov/docs-filing/efiling.asp), and 
then follow the instructions for each screen. First-time users will 
have to establish a user name and password. The Commission will send an 
automatic acknowledgement to the sender's e-mail address upon receipt 
of comments.
    For paper filings, the comments should be submitted to the Federal 
Energy Regulatory Commission, Secretary of the Commission, 888 First 
Street, NE., Washington, DC 20426, and should refer to Docket No. IC10-
919-001.
    Users interested in receiving automatic notification of activity in 
FERC Docket Number IC10-919 may do so through eSubscription at http://www.ferc.gov/docs-filing/esubscription.asp. All comments may be viewed, 
printed or downloaded remotely via the Internet through FERC's homepage 
using the ``eLibrary'' link. For user assistance, contact 
ferconlinesupport@ferc.gov or toll-free at (866) 208-3676, or for TTY, 
contact (202) 502-8659.

FOR FURTHER INFORMATION CONTACT: Ellen Brown may be reached by e-mail 
at DataClearance@FERC.gov, by telephone at (202) 502-8663, and by fax 
at (202) 273-0873.

SUPPLEMENTARY INFORMATION: The Commission is responding to comments on 
its request for a three-year extension of the information collected 
under FERC-919 (OMB Control No. 1902-0234) ``Market Based Rates for 
Wholesale Sales of Electric Energy, Capacity and Ancillary Services by 
Public Utilities.'' Order No. 697 \1\ was issued by the Commission on 
June 21, 2007 to modify Subpart H to 18 Code of Federal Regulations 
(CFR) part 35, governing market-based authorization. In Order No. 697, 
the Commission revised and codified its standards for obtaining and 
retaining market-based rates for public utilities. Order No. 697 also 
made minor adjustments to the change in status filing requirements 
adopted in Order No. 652.\2\ It added a requirement to include 
appendices of generation and transmission assets in the form provided 
in Appendix B of Order No. 697 when reporting a change in status 
regarding a change that impacts the pertinent assets held by a seller 
or its affiliates with market-based rate authorization.
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    \1\ Market-Based Rates for Wholesale Sales of Electric Energy, 
Capacity and Ancillary Services by Public Utilities, Order No. 697, 
72 FR 39,904 (Jul. 20, 2007), FERC Stats. & Regs. ] 31,252 (2007), 
clarified, 121 FERC ] 61,260 (2007), order on reh'g, Order No. 697-
A, 73 FR 25832 (May 7, 2008), FERC Stats. & Regs. ] 31,268, Order 
No. 697-B, 73 FR 79610 (Dec. 30, 2008), FERC Stats. & Regs. ] 31,285 
(2008), order on reh'g, Order No. 697-C, 74 FR 30924 (June 29, 
2009), FERC Stats. & Regs. ] 31,291 (2009), order on reh'g, Order 
No. 697-D, 75 FR 14342 (Mar. 25, 2010), FERC Stats. & Regs. ] 31,305 
(2010).
    \2\ Reporting Requirement for Changes in Status for Public 
Utilities with Market-Based Rate Authority, Order No. 652, 70 FR 
8253 (Feb. 18, 2005), FERC Stats. & Regs. ] 31,175, order on reh'g, 
111 FERC ] 61,413 (2005), FERC Stats. & Regs. ] 31,175.
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    The market power analyses required by Order No. 697 help to inform 
the Commission as to whether an entity seeking market-based rate 
authority lacks market power, and whether rates charged by that entity 
will be just and reasonable. The updated market power analyses allow 
the Commission to monitor changes in a seller's market presence or 
potential abuses of market power. The use of the Order No. 697 screens 
and reviews for market power for all companies seeking authority for 
market-based rates and those who have been charging market based rates 
results in a consistent authorization and review process. It provides 
regulatory certainty while ensuring the Commission meets

[[Page 71098]]

its statutory requirements as mandated by the Federal Power Act (FPA) 
sections 205 and 206.
    For more detailed background information on the Commission's MBR 
program and polices as they relate to this Information Collection 
Review (ICR), see the public notice issued July 13, 2010 under Docket 
No. IC10-919-000 at http://elibrary.ferc.gov/idmws/File_list.asp?document_id=13831765.
    Public Comment and FERC Response. The Commission received comments 
from EEI in response to the previously mentioned July 2010 public 
notice on this ICR. No other comments were filed. A summary of the 
comments by EEI regarding FERC-919 reporting requirements and the 
Commission's response, including proposed changes to the burden 
estimates of the FERC-919 requirements, are provided below. For 
documents related to this ICR, see http://www.reginfo.gov/public/do/PRAMain, scroll to ``Currently under Review,'' key in ``Federal Energy 
Regulatory Commission'' and scroll to 1902-0234 ``Market Based Rates 
for Wholesale Sales of Electric Energy, Capacity and Ancillary Services 
by Public Utilities.''
    Public Comment: Triennial Reviews. EEI asserts the ICR's burden 
estimate for the triennial review filings appears to be too low. Based 
on research and historical activity, FERC concluded 74 triennial market 
power analyses in category 2\3\ were filed annually. FERC estimated 
that it took an average of 40 hours to prepare each of these. EEI 
states that ``several member companies'' take 400 to 720 hours or more 
of company and consultant time to prepare the triennial review 
applications. EEI states these companies reported to them that 
preparation of the triennial review entailed:
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    \3\ Category 2 means any sellers not in Category 1. Category 1 
Sellers means wholesale power marketers and wholesale power 
producers that own or control 500 MW or less of generation in 
aggregate per region; that do not own, operate or control 
transmission facilities other than limited equipment necessary to 
connect individual generating facilities to the transmission grid 
(or have been granted waiver of the requirements of Order No. 888, 
FERC Stats. & Regs. ] 31,036); that are not affiliated with anyone 
that owns, operates or controls transmission facilities in the same 
region as the seller's generation assets; that are not affiliated 
with a franchised public utility in the same region as the seller's 
generation assets; and that do not raise other vertical market power 
issues.
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     120 to 160 hours for internal engineering analyses, 
including calculation of simultaneous transmission import limits;
     150 to 160 hours for internal legal and compliance 
analyses; and
     110 to 450 hours for outside consultant market-power and 
legal analyses, including obtaining data pertaining to loads, 
generation resources, planned outages, remote generation, and power 
purchase arrangements in broad first and second tier balancing 
authority areas.

EEI states there is additional time devoted to regional coordination 
related to triennial review preparation.

    Moreover, EEI asserts that FERC's total estimated annual cost 
burden for triennial review applications is too low. In its 60-day 
notice, FERC estimated the total average annual cost burden for 
respondents filing the data required in the FERC-919 is $2,801,891. 
This resulted from using an average cost estimate of $137,874. This 
average cost was based on salaries for internal professional and 
clerical support, as well as direct and indirect overhead costs. EEI 
argues that this average cost is not an appropriate figure to use 
because the vast majority of the work done on triennial review 
applications is performed by highly paid professionals. They state that 
outside legal, engineering, and economic expertise costs far more than 
the estimate included in the July 2010 notice for this ICR.
    EEI comments that the Commission's burden estimate for triennial 
review applications may be low by a factor of 10 or more.
    FERC Response. According to EEI comments, it is the association of 
the nation's shareholder-owned electric utilities, international 
affiliates, and industry associates worldwide. Its members represent 
approximately 70 percent of the U.S. electric power industry and serve 
95 percent of the ultimate customers in the shareholder-owned segment 
of the industry. EEI members include the majority of the public 
utilities that are subject to the Commission's rate jurisdiction under 
Federal Power Act section 205 and, therefore, must submit MBR 
applications and change-in-status reports to obtain and to retain MBR 
authorizations.
    In response to the EEI statement that ``several EEI member 
companies'' report a higher number of hours for preparing triennial 
reviews than FERC estimated in its ICR, FERC acknowledges that large 
transmission-owning utilities with market-based rate authority have to 
undertake more complex analyses in their triennial reviews than smaller 
companies who do not own transmission. However, there are significantly 
fewer entities that prepare complex analyses for their triennial 
reviews than there are small energy businesses that prepare the 
triennial reviews. FERC records show in September 2010 there were 1,590 
organizations with authority to charge market-based rates. According to 
the Energy Information Administration's most recent count from 2009, 
there are 201 investor owned utilities (generally larger than other 
respondents). These numbers give an order of magnitude as to how many 
more small sellers there are than big sellers. The filings of these 
smaller companies related to the activities of this ICR are far simpler 
and require significantly fewer resources and time to complete. It is 
this wide variation in the amount of effort required to prepare 
triennial reviews that led the Commission to conclude that basing its 
estimate on an average made the reporting burden in the July 2010 
Notice as accurate as possible.
    Nevertheless, in consideration of EEI's concerns, FERC acknowledges 
in this Notice that the complexity characteristic of triennial reviews 
prepared by transmission-owning utilities with market-based rate 
authority typically approaches what is done in the initial market power 
analysis where the utility first sought market-based rate 
authorization. FERC also recognizes that the complex analysis of 
triennial reviews for transmission-owning utilities results from the 
work of a diverse set of professions including consultant economists, 
lawyers, and electrical engineers. The costs of engaging these 
professionals may be somewhat higher than the estimate included in the 
July 2010 Notice of this ICR.
    As a result of the foregoing, FERC has increased the estimated 
average hours per response for triennial review applications from 40 to 
250--the same amount of time FERC estimates it takes to prepare a 
market power analysis for a new market-based rate application. The 
Commission has also increased the average annual salary figure 
associated with completing market power analysis in new applications 
for market-based rates as well as completing triennial reviews from 
$137,874 to $166,602. Even though EEI comments do not address the costs 
associated with initial applications for MBRs, FERC will use the 
revised $166,602 annual salary rate for triennials as the average 
annual salary amount associated with its estimates for initial MBR 
filings. The latter is an average, including benefits and bonuses, of 
the salaries for a mid-level economist, lawyer, and electrical engineer 
according to Salary.com data. (See http://salary.com).
    Public Comment: Change in status. EEI states that the ICR's burden 
estimate for change in status filings appears to be

[[Page 71099]]

too low. They argue that each change in status filing is unique and 
must be developed to fit specific circumstances. They state that FERC 
regulations require updated market-power analyses to accompany certain 
change in status filings, for example, any time there is a cumulative 
increase in ownership or control of 100 MW or more of generation 
capacity in a market. EEI states that the burden in such cases 
potentially is comparable to the burden of performing the market-power 
analysis portion of the triennial reviews. EEI asserts that the burden 
of complying is far higher than FERC's estimated one hour per report. 
Even in cases where a full market-power analysis is not required to be 
filed, EEI states that some analysis has to be done to determine 
whether such an analysis should be included in the filing. Also, beyond 
drafting and submitting the change in status filing, EEI notes in its 
comments that regulatory staff must constantly monitor business 
activities, and must train business unit staff to inform them of 
changes which may lead to a required change in status filing.
    FERC Response. As noted above, the Commission directed the filing 
of changes in status in Order No. 652. In that order, the Commission 
found the ongoing burden associated with change in status filings to be 
de minimis.\4\ As a result of that determination, the Commission did 
not attribute a burden estimate to this activity at that time; 
therefore, no authorization from OMB was needed for that data 
collection. In examining various aspects of it market-based rate 
program in Order No. 697, FERC compiled all market-based rate data 
requirements into this ICR, the FERC-919. Although the consolidation of 
market-based rate data requirements in the FERC-919 included change in 
status filings, FERC did not estimate burden hours for the change in 
status filings based on the assumption they were still a de minimis 
activity as determined in Order No. 652. In the July Notice for this 
ICR FERC did, however, estimate that the Appendix B addition to change 
in status filings would take one hour to complete.
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    \4\ Order No. 652, FERC Stats. & Regs. ] 31,175 at P 35 (``the 
time and effort required to prepare the notice of a change in 
status--consisting of a transmittal sheet and a brief narrative 
statement--will be de minimis and will constitute a fraction of that 
required to submit the [FPA] section 203 application or [FPA] 
section 205 filing. Furthermore, the information required to comply 
with the reporting requirement would normally be collected by the 
market-based rate seller in the ordinary course of preparing the 
underlying filing.'')
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    As an initial matter, FERC would like to clarify an apparent 
misunderstanding regarding whether an updated market power analysis is 
required to be submitted with a change in status filing. FERC does not, 
in all instances, require market-based rate sellers to include an 
updated market power analysis with a change in status filing that 
involves an increase in ownership or control of 100 MW or more of 
capacity. The Commission has left it to the market-based rate seller to 
determine whether a change in status is a material change and to 
provide adequate support and analysis for that conclusion, including 
submission of an updated market power analysis if it chooses.\5\ 
However, it is hereby noted that the Commission retains the right to 
require additional information, including an updated market power 
analysis where necessary to determine the effect of a seller's change 
in status on its market-based rate authority.\6\
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    \5\ See Order No. 697-A, FERC Stats. & Regs. ] 31,268 at P 504 
(``In Order No. 652, the Commission clarified and standardized 
market-based rate sellers' reporting requirement for changes in 
status and the Commission considered and rejected the idea that 
change in status filing include an updated market power analysis. 
The Commission explained that it is incumbent on an applicant to 
decide whether a change in status is a material change and that an 
applicant should provide adequate support and analysis, including an 
updated market power analysis if it chooses.'') See also Order No. 
652, FERC Stats. & Regs. ] 31,175 at P 95.
    \6\ See Order No. 697-A, FERC Stats. & Regs. ] 31,268 at P 505.
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    In response to EEI's comments, FERC reviewed change in status 
filings made October 21, 2008 to October 20, 2010. To facilitate its 
analyses, FERC divided change in status filings into two categories 
based on the complexity and amount of work evident in the filing. Those 
filings that were voluminous, provided detailed economic and market 
data, undertook market power analyses and provided substantive 
information about current operational dynamics were categorized as 
``major'' change in status filings. These filings most commonly 
included a full market power analysis with significant amount of detail 
and complexity. Filings that did not include detailed market power 
analyses but instead relied on simplified assumptions based on 
previously submitted market power analyses to conclude that the change 
in status did not reflect a departure from the characteristics the 
Commission relied upon in granting the seller market-based rate 
authority were categorized as ``minor.'' The change in status filings 
categorized as ``minor'' were often from a market-based rate seller who 
simply pointed to a recent market power study for the same market as 
support for its contention that, given the size of the market and the 
size of the seller's uncommitted generation capacity, the seller does 
not have market power in the market; thus, the acquisition has not 
changed any of the facts upon which the Commission relied in granting 
the seller market-based rate authority. FERC also noted that sellers 
sometimes make supplemental filings providing additional information 
relating to previously submitted change in status. These supplemental 
filings can similarly be categorized as ``major'' or ``minor.''
    FERC assessment and tally of these filings is as follows:

                              Total Number of Change in Status Filings at FERC: 82
                                           [10-21-2009 to 10-20-2010]
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   All change in status filings         Change in status (CIS) filings            Supplemental CIS filings
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                                                     CIS          CIS          CIS
           Total filings            Initial CIS   requiring    requiring    previously   Major work   Minor work
                                       filing     major work   minor work     filed
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82................................           62            9           53           20            3           17
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[[Page 71100]]

                              Total Number of Change in Status Filings at FERC: 78
                                           [10-21-2008 to 10-20-2009]
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   All change in status filings         Change in status (CIS) filings            Supplemental CIS filings
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                                                     CIS          CIS          CIS
           Total filings            Initial CIS   requiring    requiring    previously   Major work   Minor work
                                       filing     major work   minor work     filed
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78................................           77            8           69            1                         1
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    From October 21, 2009 to October 20, 2010, there were a total of 82 
change in status filings. Sixty-two of these were initial change in 
status filings, nine of which were categorized as ``major'' and 53 of 
which were categorized as ``minor.'' The remaining 20 filings were 
supplements to initial notice of change in status filings submitted by 
companies to provide additional information regarding a filing they had 
already made; 3 of these supplemental filings were categorized as 
``major'' and 17 were categorized as ``minor.'' Between October 21, 
2008 to October 20, 2009, there were a total of 78 change in status 
filings. Seventy-seven were initial change in status filings, eight of 
which were ``major'' and 69 of which were categorized as ``minor.'' One 
of the 78 filings was a ``minor'' supplement to an initial change in 
status.
    Based on the EEI's comments and historical data regarding change in 
status filings, FERC has decided to increase its assessment of the 
reporting burden hours for change in status filings to 34.75 hours per 
response, which includes preparation of the associated asset 
appendices. FERC estimates an average of 80 change in status filings 
per year [(82 + 78)/2 = 80)]. Of these, it estimates that 10 will be 
major (250 hours per response) and 70 will be minor (4 hours per 
response). By taking an average, FERC estimates that the total annual 
burden for change in status filings is 2,780 hours [(250*10 = 2500) + 
(70*4 = 280) = 2,780]. FERC estimates an average of 58 respondents per 
year each filing an average of 1.38 responses (80 filings per year/58 = 
1.38 \7\). Using the above estimates the average burden hours per 
response is 34.75 (2,780 total hours/80 responses = 34.75).
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    \7\ Rounded off due to truncating the average number of 
responses per respondent to two decimal places.
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    Action: The Commission is requesting a three-year extension of the 
FERC-919 reporting requirements, with revised burden and cost estimates 
based on comments received in response to its July 2010 Notice and as 
described above. There is no change to the reporting requirements.
    Burden Statement: The revised estimated annual burden for triennial 
market power analysis in category 2 seller updates and the change in 
status filings are shown below. There are also changes from the July 
2010 Notice burden and cost estimates for market power analyses in new 
applications for market based rates because FERC has revised the 
average salary estimate for preparing market power analysis. There are 
no changes to the burden estimates for the quarterly land acquisition 
reports.

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                                                     Estimated        Average         Average      Total annual
                                                     number of       number of     burden hours    burden hours
                    FERC-919                        respondents    responses per   per response     (1) x (2) x
                                                   annually (1)   respondent (2)        (3)             (3)
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Market power analysis in new applications for                155               1             250          38,750
 market-based rates (required in 18 CFR
 35.37(a))......................................
Triennial market power analysis in category 2                 74               1             250          18,500
 seller updates (required in 18 CFR 35.37(a))...
Quarterly land acquisition reports (required in               40               1               4             160
 18 CFR 35.42(d))...............................
Change in Status Filings (required in 18 CFR                  58            1.38           34.75       \7\ 2,780
 35.42(a))......................................
                                                 ---------------------------------------------------------------
    Total.......................................  ..............  ..............  ..............          60,190
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    The total estimated annual cost burden to respondents is $4,814,968 
[((38,750 + 18,500 + 2,500 \8\)/2,080 \9\ hours per year, times 
$166,602) + ((280 \10\ + 160)/2,080 hours per year, times $137,874) = 
$4,814,968]. This number uses the average salary rate of $166,602, 
which includes annual salaries, bonuses and benefits, of a mid-level 
economist, lawyer, and electrical engineer according to Salary.com 
data, for the hours required in 18 CFR 35.37(a) for market power 
analysis in new applications for market-based rates, triennial market 
power analysis in category 2 seller updates and major change in status 
filings. It uses the average salary rate for an internal professional 
of $137,874, based on a FERC estimate, for preparation of the quarterly 
land acquisition reports and minor change in status filings.
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    \8\ Total number of burden hours for major change in status 
filings. Of the 80 responses per year, 10 are major (10 responses x 
250 hours per response = 2500).
    \9\ Estimated number of hours an employee works each year.
    \10\ Total number of burden hours for minor change in status 
filings. Of the 80 responses per year, 70 are minor (70 responses x 
4 hours per response = 280).
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    The reporting burden includes the total time, effort, or financial 
resources expended to generate, maintain, retain, disclose, or provide 
the information including: (1) Reviewing instructions; (2) developing, 
acquiring, installing, and utilizing technology and systems for the 
purposes of collecting, validating, verifying, processing, maintaining, 
disclosing and providing information; (3) adjusting the existing ways 
to comply with any previously applicable instructions and requirements; 
(4) training personnel to respond to a collection of information; (5) 
searching data sources; (6) completing and reviewing the collection of 
information;

[[Page 71101]]

and (7) transmitting, or otherwise disclosing the information.
    The estimate of cost for respondents is based upon salaries for 
professional and clerical support, as well as direct and indirect 
overhead costs. Direct costs include all costs directly attributable to 
providing this information, such as administrative costs and the cost 
for information technology. Indirect or overhead costs are costs 
incurred by an organization in support of its mission. These costs 
apply to activities which benefit the whole organization rather than 
any one particular function or activity.
    Any additional comments are invited on: (1) Whether the proposed 
collections of information are necessary for the proper performance of 
the functions of the Commission, including whether the information will 
have practical utility; (2) the accuracy of the agency's estimates of 
the burden of the proposed collections of information, including the 
validity of the methodology and assumptions used; (3) ways to enhance 
the quality, utility and clarity of the information to be collected; 
and (4) ways to minimize the burden of the collections of information 
on those who are to respond, including the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g. permitting 
electronic submission of responses.

Kimberly D. Bose,
Secretary.
[FR Doc. 2010-29304 Filed 11-19-10; 8:45 am]
BILLING CODE 6717-01-P