        DEPARTMENT OF DEFENSE
        GENERAL SERVICES ADMINISTRATION
        NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
        48 CFR Parts 2, 5, 7, 8, 10, 12, 15, 16, 19, and 52
        [FAR Case 2014-015; Docket No. 2014-0015; Sequence No. 1]
        RIN 9000-AM92
        Federal Acquisition Regulation; Consolidation and Bundling of Contract Requirements

          AGENCY:
          Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).

          ACTION:
          Proposed rule.

          SUMMARY:
          DoD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation (FAR) to implement sections of the Small Business Jobs Act of 2010 and regulatory changes made by the Small Business Administration, which provide for a Governmentwide policy on the consolidation and bundling of contract requirements.

          DATES:
          Interested parties should submit written comments to the Regulatory Secretariat at one of the addresses shown below on or before August 3, 2015 to be considered in the formation of the final rule.

          ADDRESSES:
          Submit comments in response to FAR Case 2014-015 by any of the following methods:
          • Regulations.gov: http://www.regulations.gov. Submit comments via the Federal eRulemaking portal by searching for “FAR Case 2014-015”. Select the link “Comment Now” that corresponds with “FAR Case 2014-015.” Follow the instructions provided at the “Comment Now” screen. Please include your name, company name (if any), and “FAR Case 2014-015” on your attached document.
          • Mail: General Services Administration, Regulatory Secretariat (MVCB), ATTN: Ms. Flowers, 1800 F Street NW., 2nd Floor, Washington, DC 20405.

            Instructions: Please submit comments only and cite FAR Case 2014-015, in all correspondence related to this case. All comments received will be posted without change to http://www.regulations.gov, including any personal and/or business confidential information provided.

          FOR FURTHER INFORMATION CONTACT:
          Ms. Mahruba Uddowla, Procurement Analyst, at 703-605-2868, for clarification of content. For information pertaining to status or publication schedules, contact the Regulatory Secretariat at 202-501-4755. Please cite FAR Case 2014-015.

        SUPPLEMENTARY INFORMATION:

        I. Background

        DoD, GSA, and NASA are proposing to revise the FAR to implement regulatory changes made by the Small Business Administration (SBA) in its final rule which was published in the Federal Register at 78 FR 61113 on October 2, 2013, concerning contract consolidation and bundling. SBA's final rule implements the statutory requirements set forth at sections 1312 and 1313 of the Small Business Jobs Act of 2010 (Jobs Act) (Pub. L. 111-240). This proposed rule will encompass the acquisition of commercial items, including commercially available off-the-shelf (COTS) items.
        Section 1312 of the Jobs Act amends the Small Business Act at 15 U.S.C. 644(q) to require Federal agencies to include in each solicitation for any multiple-award contract above the substantial bundling threshold of the Federal agency a provision soliciting bids from any responsible source, including responsible small business teaming arrangements or joint ventures of small business concerns. Section 1312 requires the FAR be amended to establish a Governmentwide policy regarding contract bundling, including regarding the solicitation of teaming and joint ventures, and to require agencies to publish said policy on their agency Web site. Section 1312 also requires the head of the Federal agency to publish on the Web site of the Federal agency a list and rationale for any bundled contract for which the Federal agency solicited bids or that was awarded by the agency.
        Section 1313 amends the Small Business Act at 15 U.S.C. 657q to define the term “consolidation of contract requirements” to mean the use of a solicitation to obtain offers for a single contract or a multiple-award contract to satisfy two or more requirements of the Federal agency for goods or services that have been provided to or performed for the Federal agency under two or more separate contracts, each of which was lower in cost than the total cost of the contract for which the offers are solicited. The National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2013 (2013 NDAA), Public Law 112-239, section 1671 further amended the definition of consolidation to include construction requirements.
        Further, section 1313 prohibits the agency from carrying out an acquisition strategy that includes consolidation of contract requirements of the Federal agency with an estimated total value exceeding $2 million, unless the Senior Procurement Executive or Chief Acquisition Officer for the Federal agency, before carrying out the acquisition strategy—
        • Conducts market research;
        • Identifies any alternative contracting approach that would involve a lesser degree of consolidation of contract requirements;
        • Makes a written determination that the consolidation of contract requirements is necessary and justified;
        • Identifies any negative impact by the acquisition strategy on contracting with small business concerns; and
        • Ensures that steps will be taken to include small business concerns in the acquisition strategy.
        II. Discussion and Analysis
        Amendments to the FAR are proposed by this rule. The proposed changes are summarized in the following paragraphs.
        A. FAR Subpart 2.1, Definitions. This subpart is amended to revise the definition of “bundling” for clarity, incorporating the definition of “bundled contract”, and to add a new definition for “consolidation, consolidation of contract requirements, consolidated contract or consolidated requirement”. In keeping with SBA's final rule and section 1671 of the NDAA for FY 2013, Public Law 112-239, the latter definition also encompasses the consolidation of construction requirements. This subpart is also amended to add a definition for “small business teaming arrangement”.
        B. FAR Subpart 5.2, Synopses of Proposed Contract Actions. A conforming cross-reference has been added at FAR 5.205(g).
        C. FAR Subpart 7.1, Acquisition Plans.

        • FAR 7.103—This section is amended to clarify that agencies are to ensure that unnecessary and unjustified consolidation is avoided.
        • FAR 7.104—This section is amended to remove the substantial bundling thresholds at FAR 7.104. The substantial bundling thresholds are relocated to the proposed new section FAR 7.107-4, Substantial Bundling, for clarity and consistency with the new proposed structure of FAR 7.107. An additional revision was made to clarify that small business is to be a discipline that is represented in the acquisition planning team.
        • FAR 7.105—This section is amended by adding a reference to the statutory authority for limiting the use of acquisition strategies involving the consolidation of contract requirements.
        • FAR 7.107—This section is amended by revising the title of the section and adding the statutory authority for the consolidation of contract requirements. This section also proposes to clarify that if a requirement is considered both consolidated and bundled, the agency must follow the guidance regarding bundling. In addition, this section is amended by restructuring FAR 7.107 to add proposed subsections FAR 7.707-1, General, FAR 7.107-2, Consolidation of contract requirements, FAR 7.107-3 Bundling, FAR 7.107-4 Substantial Bundling, FAR 7.107-5 Notifications, and 7.107-6 Solicitation provision. The proposed revisions are as follows:
        ○ FAR 7.107-1—General. This proposed new section provides information relevant to both consolidation and bundling, such as evaluation of benefits, substantial benefits, and applicability.
        ○ FAR 7.107-2—Consolidation of contract requirements. This proposed new section is added to clarify that an agency may not conduct an acquisition exceeding $2 million that is a consolidation of contract requirements unless the agency's Senior Procurement Executive or Chief Acquisition Officer: (1) Justifies the consolidation by showing that the benefits of the consolidated acquisition substantially exceed the benefits of each possible alternative approach that would involve a lesser degree of consolidation and (2) identify any negative impact by the acquisition strategy on contracting with small business concerns.
        ○ FAR 7.107-3—Bundling. This proposed new section clarifies language regarding the requirements a contracting officer must adhere to prior to conducting an acquisition strategy that involves the bundling of contract requirements.
        ○ FAR 7.107-4—Substantial Bundling. This proposed new section includes the substantial bundling thresholds relocated from FAR 7.104(d) and existing documentation requirements.

        ○ FAR 7.107-5—Notifications. This proposed new section is added to require Federal agencies to: (1) Notify current small business contractors of an agency's intent to bundle a contract requirement that was not previously bundled at least 30 days prior to the issuance of the solicitation; (2) provide public notification of an agency's intent to bundle by publishing on the agency's Web site a list and rationale for any bundled requirement for which the agency solicited offers or issued an award; (3) require the agency to notify SBA of a follow-on bundled or consolidated contract requirement; and (4) publish the Governmentwide policy regarding contract bundling, including regarding the solicitation of teaming and joint ventures, on their agency Web site.
        ○ FAR 7.107-6—Solicitation Provision. This proposed new section is added to prescribe a new provision 52.207-XX “Solicitation of Offers from Small Business Concerns and Small Business Teaming Arrangements or Joint Ventures (Multiple-Award Contracts)”, in solicitations for multiple-award contracts that are estimated to be above the agency's substantial bundling threshold.
        D. FAR Subpart 8.4, Federal Supply Schedules. Proposed revisions to FAR 8.404(c)(2) are necessary to apply consolidation requirements to orders.
        E. FAR Part 10, Market Research. Proposed revisions to FAR 10.001 are necessary to add references to the statutory authority for the consolidation of contract requirements.
        F. FAR Subpart 12.3, Solicitation Provisions and Contract Clauses for the Acquisition of Commercial Items. Proposed revisions to FAR 12.301(d)(4) are necessary to add a reference to the new provision for multiple-award contracts over the substantial bundling thresholds at FAR 52.207-XX, Solicitation of Offers from Small Business Concerns and Small Business Teaming Arrangements or Joint Ventures (Multiple-Award Contracts).
        G. FAR Subpart 15.3, Source Selection.

        • FAR 15.304, Evaluation factors and significant subfactors. This section is amended by adding references to the consolidation of contract requirements.
        H. FAR Subpart 16.5, Indefinite-Delivery Contracts.

        • FAR 16.505, Ordering. This section is amended to apply consolidation requirements to orders.
        • FAR 16.506, Solicitation provisions and contract clauses. This section is amended by adding a cross-reference to the prescription in FAR Subpart 7.1 for a new provision “Solicitation of Offers from Small Business Concerns and Small Business Teaming Arrangements or Joint Ventures (Multiple-Award Contracts)”.
        I. Subpart 19.2, Policies.

        • FAR 19.201 General policy and 19.202-1 Encouraging small business participation in acquisitions. These sections are amended by adding references to the consolidation of contract requirements.
        J. FAR Subpart 52.2, Text of Provisions and Clauses.

        • FAR 52.207-XX, Solicitation of Offers from Small Business Concerns and Small Business Teaming Arrangements or Joint Ventures (Multiple-Award Contracts). This section is amended to include this provision in solicitations for multiple-award contracts when the estimated contract value is expected to exceed the agency's substantial bundling threshold. The agency shall consider offers from any responsible source, including responsible small business concerns and teaming arrangements or joint ventures of small business concerns.
        III. Executive Orders 12866 and 13563
        Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.
        IV. Regulatory Flexibility Act

        The change may have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. The Initial Regulatory Flexibility Analysis (IRFA) is summarized as follows:

          DoD, GSA, and NASA are proposing to amend the FAR to provide uniform guidance consistent with SBA's final rule which was published in the Federal Register at 78 FR 61113 on October 2, 2013, which implements sections 1312 and 1313 of the Small Business Jobs Act of 2010, Public Law 111-240.
          The objective of this proposed rule is to alleviate the adverse effects of contract bundling and consolidation on small business concerns competing for Federal contracts. This rule provides a balance between the benefits of bundling and consolidation and the obstacles they create for small businesses. The authorizing legislation for this action is sections 1312 and 1313 of the Small Business Jobs Act of 2010, Public Law 111-240, and section 1671 of the NDAA for FY 2013 Public Law 112-239. Section 1671 in conjunction with section 1313 now provides for a Governmentwide requirement and threshold for consolidated contracts.
          This rule may have a positive economic impact on any small business entity that wishes to participate in the Federal procurement arena. Analysis of the System for Award Management (SAM) database indicates there are over 351,203 small business registrants that can potentially benefit from the implementation of this rule.
          This rule does not impose any new reporting, recordkeeping or other compliance requirements. The rule does not duplicate, overlap, or conflict with any other Federal rules.

        The Regulatory Secretariat has submitted a copy of the IRFA to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the IRFA may be obtained from the Regulatory Secretariat. DoD, GSA, and NASA invite comments from small business concerns and other interested parties on the expected impact of this rule on small entities.
        DoD, GSA, and NASA will also consider comments from small entities concerning the existing regulations in subparts affected by the rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (FAR Case 2014-015), in correspondence.
        V. Paperwork Reduction Act
        The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

          List of Subjects in 48 CFR Parts 2, 5, 7, 8, 10, 12, 15, 16, 19, and 52
          Government procurement.

          Dated: May 28, 2015.
          William Clark,
          Director, Office of Government-wide Acquisition Policy, Office of Acquisition Policy, Office of Government-wide Policy.

        Therefore, DoD, GSA, and NASA propose amending 48 CFR parts 2, 5, 7, 8, 10, 12, 15, 16, 19, and 52 as set forth below:
        1. The authority citation for 48 CFR parts 2, 5, 7, 8, 10, 12, 15, 16, 19, and 52 continues to read as follows:

          Authority:
          40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 U.S.C. 20113.

          PART 2—DEFINITIONS OF WORDS AND TERMS

        2. Amend section 2.101 in paragraph (b) by—
        a. Removing the definition “Bundled contract”;
        b. Revising the definition “Bundling”;

        c. Adding, in alphabetical order, the definitions “Consolidation, consolidation of contract requirements, consolidated contract, or consolidated requirement”; and “Small Business Teaming Arrangement”.
        The revised and added text reads as follows:

          2.101
          Definitions.

          (b) * * *
          (2) * * *

            Bundling or bundled contract—
          (1) Means the consolidating or combining of two or more requirements for supplies or services, previously provided or performed under separate smaller contracts, into a solicitation for a single contract, a multiple-award contract, a task order or delivery order that is likely to be unsuitable for award to a small business concern (but may be suitable for award to a small business with a Small Business Teaming Arrangement) due to—
          (i) The diversity, size, or specialized nature of the elements of the performance specified;
          (ii) The aggregate dollar value of the anticipated award;
          (iii) The geographical dispersion of the contract performance sites; or
          (iv) Any combination of the factors described in paragraphs (1)(i), (ii), and (iii) of this definition.
          (2) “Separate smaller contract” as used in this definition, means a contract that has been performed by one or more small business concerns or that was suitable for award to one or more small business concerns.
          (3) This definition does not apply to a contract that will be awarded and performed entirely outside of the United States.
          (4) (See 7.107-4 for a description of substantial bundling.)

            Consolidation, consolidation of contract requirements, consolidated contract, or consolidated requirement—
          (1) Means a solicitation for a single contract, a multiple-award contract, a task order, or a delivery order to satisfy—
          (i) Two or more requirements of the Federal agency for supplies or services that have been provided to or performed for the Federal agency under two or more separate contracts, each of which was lower in cost than the total cost of the contract for which offers are solicited; or
          (ii) Requirements of the Federal agency for construction projects to be performed at two or more discrete sites.
          (2) Separate contract as used in this definition, means a contract that has been performed by any business, including small and other than small business concerns.

            Small Business Teaming Arrangement—
          (1) Means an arrangement where—
          (i) Two or more small business concerns have formed a joint venture; or
          (ii) A potential small business prime contractor (“offeror”) agrees with one or more other small business concerns to have them act as its subcontractors under a specified Government contract. A Small Business Teaming Arrangement between the offeror and its small business subcontractor(s) exists through a written agreement between the parties that—
          (A) Is specifically referred to as a Small Business Teaming Arrangement or Small Business Teaming Agreement; and
          (B) Sets forth the different responsibilities, roles, and percentages (or other allocations) of work as it relates to the acquisition; and
          (2) May include two business concerns in a mentor-protege relationship so long as both the mentor and the protege are small or the protege is small and the concerns have received an exception to affiliation pursuant to 13 CFR 121.103(h)(3)(ii) or (iii).
          (3) See 13 CFR 121.103(b)(9) regarding the exception to affiliation for offers received from Small Business Teaming Arrangements.

          PART 5—PUBLICIZING CONTRACT ACTIONS

        3. Amend section 5.205 by adding paragraph (g) to read as follows:

          5.205
          Special situations.

          (g) Notification to public of rationale for bundled requirement. See 7.107-5(b)(2) with regard to notification to FedBizOpps.gov before issuance of the solicitation of any bundled requirement.

          PART 7—ACQUISITION PLANNING

        4. Amend section 7.103 by revising paragraph (u)(2) to read as follows:

          7.103
          Agency-head responsibilities.

          (u) * * *
          (2) Avoid unnecessary and unjustified consolidation or bundling of contract requirements that precludes small business participation as prime contractors (see 7.107) (15 U.S.C. 631(j) and 15 U.S.C. 657(q)).

        5. Amend section 7.104 by removing from paragraph (a) “contracting,” and adding “contracting, small business,” in its place; and revising paragraph (d) to read as follows:

          7.104
          General procedures.

          (d) The planner shall coordinate the acquisition plan or strategy with the cognizant small business specialist when the strategy contemplates an acquisition meeting the dollar amounts for substantial bundling unless the contract or task order or delivery order is entirely reserved or set-aside for small business under part 19. The small business specialist shall notify the agency Office of Small and Disadvantaged Business Utilization or the Office of Small Business Programs if the strategy involves consolidation or bundling that is unnecessary, unjustified, or not identified as consolidated or bundled by the agency (see 7.107 for further guidance regarding consolidation and bundling).

        6. Amend section 7.105 by revising paragraph (b)(1) to read as follows:

          7.105
          Contents of written acquisition plans.

          (b) Plan of action. (1) Sources. (i) Indicate the prospective sources of supplies or services that can meet the need.

          (ii) Consider required sources of supplies or services (see part 8) and sources identifiable through databases including the Governmentwide database of contracts and other procurement instruments intended for use by multiple agencies available at https://www.contractdirectory.gov/contractdirectory/.

          (iii) Include consideration of small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns (see part 19).
          (iv) Consider the impact of any consolidation or bundling that might affect participation of small businesses in the acquisition (see 7.107) (15 U.S.C. 644(e) and 15 U.S.C. 657(q)). When the proposed acquisition strategy involves the consolidation or bundling of contract requirements, identify the incumbent contractors and contracts affected by the consolidation or bundling.
          (v) Address the extent and results of the market research and indicate their impact on the various elements of the plan (see part 10).

        7. Revise section 7.107 to read as follows:

          7.107
          Additional requirements for acquisitions involving consolidation, bundling, or substantial bundling.

          7.107-1
          General.
          (a) Consolidation and bundling of contract requirements may provide substantial benefits to the Government. However, because of the potential impact on small business participation, the agency shall conduct market research and any required analysis to determine whether consolidation is necessary and justified in accordance with 15 U.S.C. 657(q) or if bundling is necessary and justified pursuant to 15 U.S.C. 644(e)(2).
          (b) A consolidated or bundled requirement is necessary and justified if the benefits of the acquisition strategy substantially exceed the benefits of each of the possible alternative contracting approaches identified.
          (c) Such benefits may include—
          (1) Cost savings;
          (2) Price reduction;
          (3) Quality improvements that will save time or improve or enhance performance or efficiency;
          (4) Reduction in acquisition cycle times, or
          (5) Better terms and conditions.
          (d) Benefits are substantial if individually, in combination, or in the aggregate the anticipated financial benefits are equivalent to—
          (1) Ten percent of the estimated contract or order value (including options) if the value is $94 million or less; or
          (2) Five percent of the estimated contract or order value (including options) or $9.4 million, whichever is greater, if the value exceeds $94 million.
          (e) Reduction of administrative or personnel costs alone is not sufficient justification for consolidation or bundling unless the cost savings are expected to be at least 10 percent of the estimated contract or order value (including options) of the consolidated or bundled requirements. For consolidated requirements, the Senior Procurement Executive or Chief Acquisition Officer must make a determination of the cost savings (15 U.S.C. 657(q)(c)(2)).
          (f) If the requirement is considered both consolidated and bundled, the agency shall follow the guidance regarding bundling in 7.107-3 and 7.107-4).
          (g) The requirements of this section do not apply—
          (1) Except 7.107-4, if a cost comparison analysis will be performed in accordance with OMB Circular A-76; and
          (2) To orders against single-agency task-order contracts or delivery-order contracts, if the requirement was considered in determining that the consolidation or bundling of the underlying contract was necessary and justified.

          7.107-2
          Consolidation of contract requirements.
          (a) Before conducting an acquisition that is a consolidation of contract requirements with an estimated total dollar value exceeding $2 million, the Senior Procurement Executive or Chief Acquisition Officer shall make a written determination that the consolidation of contract requirements is necessary and justified, after ensuring that—
          (1) Market research has been conducted;
          (2) Any alternative contracting approaches that would involve a lesser degree of consolidation of contract requirements have been identified;
          (3) The determination is coordinated with the agency's Office of Small Disadvantaged Business Utilization or the Office of Small Business Programs;
          (4) Any negative impact by the acquisition strategy on contracting with small business concerns has been identified; and
          (5) Steps are taken to include small business concerns in the acquisition strategy.
          (b) The Senior Procurement Executive or Chief Acquisition Officer may determine that the consolidation of contract requirements is necessary and justified if, as compared to the benefits that would be derived from the alternative contracting approaches identified under paragraph (a)(2) of this subsection, consolidation would derive substantial benefits (see 7.107-1(d)).
          (c) If a determination is made, the contracting officer shall include it in the acquisition strategy documentation and provide it to SBA upon request.

          7.107-3
          Bundling.
          (a) Before conducting an acquisition strategy that involves the bundling of contract requirements, the agency shall make a written determination that the bundling is necessary and justified. A bundled requirement is considered necessary and justified if the agency would obtain measurably substantial benefits as compared to meeting its agency's requirements through separate smaller contracts or orders.
          (b) The agency shall quantify the specific benefits identified through the use of market research and other techniques to explain how their impact would be measurably substantial (see 10.001(a)(2)(iv) and (a)(3)(vi)).
          (c) Without power of delegation, the service acquisition executive for the military departments, the component acquisition executive for the Defense Logistics Agency, the Under Secretary of Defense for Acquisition, Technology and Logistics for the defense agencies, or the Deputy Secretary or equivalent for the civilian agencies may determine that bundling is necessary and justified when—
          (1) The expected benefits do not meet the thresholds for a substantial benefit but are critical to the agency's mission success; and
          (2) The acquisition strategy provides for maximum practicable participation by small business concerns.
          (d) In assessing whether cost savings and/or price reduction would be achieved through bundling, the agency and SBA shall—
          (1) Compare the price that has been charged by small businesses for the work that they have performed; or
          (2) Where previous prices are not available, compare the price, based on market research, that could have been or could be charged by small businesses for the work not previously performed by other than a small business.
          (e) If a determination is made, the contracting officer shall include it in the acquisition strategy documentation and provide it to SBA upon request.

          7.107-4
          Substantial bundling.
          (a)(1) Substantial bundling is any bundling that results in a contract or order with an estimated value of—
          (i) $8 million or more for the Department of Defense;
          (ii) $6 million or more for the National Aeronautics and Space Administration, the General Services Administration, and the Department of Energy; or
          (iii) $2.5 million or more for all other agencies.
          (2) These thresholds apply to the cumulative estimated dollar value (including options) of—
          (i) Multiple-award contracts;
          (ii) Task orders or delivery orders issued against a GSA Schedule contract; or
          (iii) Task orders or delivery orders issued against a task-order or delivery-order contract awarded by another agency.
          (b) In addition to addressing the requirements for bundling (see 7.107-3), when the proposed acquisition strategy involves substantial bundling, the agency shall document in its strategy—

          (1) The specific benefits anticipated to be derived from substantial bundling;

          (2) An assessment of the specific impediments to participation by small business concerns as contractors that result from substantial bundling;
          (3) Actions designed to maximize small business participation as contractors, including provisions that encourage small business teaming;
          (4) Actions designed to maximize small business participation as subcontractors (including suppliers) at any tier under the contract, or order, that may be awarded to meet the requirements;
          (5) The determination that the anticipated benefits of the proposed bundled contract or order justify its use; and
          (6) Alternative strategies that would reduce or minimize the scope of the bundling, and the rationale for not choosing those alternatives.

          7.107-5
          Notifications.
          (a) Notifications to current small business contractors of agency's intent to bundle.

          (1) The contracting officer shall notify each small business performing a contract that it intends to bundle the requirement with one or more other requirements at least 30 days prior to the issuance of the solicitation for the bundled requirement.
          (2) The notification shall provide the name, phone number and address of the applicable SBA procurement center representative (PCR), or if a PCR is not assigned to the procuring activity, the SBA Office of Government Contracting Area Office serving the area in which the buying activity is located (see subpart 19.4 regarding the duties and responsibilities of the SBA PCR).
          (3) This notification shall be documented in the contract file.
          (b) Notification to public of rationale for bundled requirement.

          (1) The agency shall publish on its Web site a list and rationale for any bundled requirement for which the agency solicited offers or issued an award. The notification shall be made within 30 days of the agency's data certification regarding the validity and verification of data entered in the Federal Procurement Data System to the Office of Federal Procurement Policy (see 4.604).
          (2) In addition, the agency is encouraged to provide to FedBizOpps.gov, before issuance of the solicitation, notification of the rationale for any bundled requirement (see 5.201).
          (c) Notification to SBA of follow-on bundled or consolidated requirements. For each follow-on bundled or consolidated contract (even if additional requirements have been added or some have been deleted), the contracting officer shall obtain from the requiring activity and notify the SBA PCR as soon as possible but no later than 30 days prior to issuance of the solicitation of—
          (1) The amount of savings and benefits achieved under the prior consolidation or bundling of contract requirements;
          (2) Whether such savings and benefits will continue to be realized if the contract remains consolidated or bundled; and
          (3) Whether such savings and benefits would be greater if the procurement requirements were divided into separate solicitations suitable for award to small business concerns.
          (d) Public notification of bundling policy. In accordance with 15 U.S.C. 644(q)(2)(A)(ii), agencies shall publish the Governmentwide policy regarding contract bundling, including regarding the solicitation of teaming and joint ventures, on their agency Web site.

          7.107-6
          Solicitation provision.
          The contracting officer shall insert the provision at 52.207-XX, Solicitation of Offers from Small Business Concerns and Small Business Teaming Arrangements or Joint Ventures (Multiple-Award Contracts), in solicitations for multiple-award contracts above the substantial bundling threshold of the agency.

          PART 8—REQUIRED SOURCES OF SUPPLIES AND SERVICES

        8. Amend section 8.404 by revising paragraph (c)(2) to read as follows:

          8.404
          Use of Federal Supply Schedules.

          (c) * * *
          (2) Shall comply with all FAR requirements for a consolidated or bundled contract when the task order or delivery order meets the definition at 2.101(b) of “consolidation” or “bundling”; and

          PART 10—MARKET RESEARCH

        9. Amend section 10.001 by—
        a. Removing from the introductory text of paragraph (a) “Agencies must—” and adding “Agencies shall—” in its place;
        b. Revising paragraphs (a)(2)(iv) and (a)(2)(vi)(B);
        c. Removing from the end of paragraph (a)(3)(v) “efficiency; and” and adding “efficiency;” in its place;
        d. Redesignating paragraphs (a)(3)(vi) and (a)(3)(vii) as paragraphs (a)(3)(vii) and (a)(3)(viii), respectively;
        e. Adding a new paragraph (a)(3)(vi);
        f. Revising the newly designated paragraph (a)(3)(vii); and
        g. Revising paragraph (c) to read as follows.

          10.001
          Policy.
          (a) * * *
          (2) * * *
          (iv) Before soliciting offers for acquisitions that could lead to a consolidated or bundled contract (15 U.S.C. 644(e)(2)(A) and 15 U.S.C. 657q);

          (B) Disaster relief to include debris removal, distribution of supplies, reconstruction, and other disaster or emergency relief activities (see 26.205); and
          (3) * * *
          (vi) Determine whether consolidation is necessary and justified (see 7.107-2) (15 U.S.C. 657q);
          (vii) Determine whether bundling is necessary and justified (see 7.107-3) (15 U.S.C. 644(e)(2)(A)); and

          (c) If an agency contemplates awarding a consolidated or bundled contract, the agency—
          (1) When performing market research, should consult with the agency small business specialist and the local Small Business Administration procurement center representative (PCR). If a PCR is not assigned, see 19.402(a); and
          (2) Shall notify any affected incumbent small business concerns of the Government's intention to bundle the requirement and how small business concerns may contact the appropriate Small Business Administration procurement center representative (see 7.107-5(a).

          PART 12—ACQUISITION OF COMMERCIAL ITEMS

        10. Amend section 12.301 by redesignating paragraphs (d)(3) through (d)(6) as paragraphs (d)(4) through (d)(7), respectively; and adding a new paragraph (d)(3) to read as follows:

          12.301
          Solicitation provisions and contract clauses for the acquisition of commercial items.

          (d) * * *
          (3) Insert the provision at 52.207-XX, Solicitation of Offers from Small Business Concerns and Small Business Teaming Arrangements or Joint Ventures (Multiple-Award Contracts), as prescribed at 7.107-6.

          PART 15—CONTRACTING BY NEGOTIATION

        11. Amend section 15.304 by revising paragraphs (c)(3)(ii) and (c)(4) to read as follows:

          15.304
          Evaluation factors and significant subfactors.

          (c) * * *
          (3) * * *
          (ii) For solicitations involving the consolidation of contract requirements or bundling that offer a significant opportunity for subcontracting, the contracting officer shall include a factor to evaluate past performance indicating the extent to which the offeror attained applicable goals for small business participation under contracts that required subcontracting plans (15 U.S.C. 637(d)(4)(G)(ii)).

          (4) For solicitations involving the consolidation of contract requirements or bundling that offer a significant opportunity for subcontracting, the contracting officer shall include proposed small business subcontracting participation in the subcontracting plan as an evaluation factor (15 U.S.C. 637(d)(4)(G)(i)).

          PART 16—TYPES OF CONTRACTS

        12. Amend section 16.505 by revising paragraph (a)(8)(iii) to read as follows:

          16.505
          Ordering.
          (a) * * *
          (8) * * *
          (iii) Shall comply with all FAR requirements for a consolidated or bundled contract when the task order or delivery order meets the definition at 2.101(b) of “consolidation” or “bundling”.

        13. Amend section 16.506 by adding paragraph (i) to read as follows:

          16.506
          Solicitation provisions and contract clauses.

          (i) See 7.107-6 for use of 52.207-XX, Solicitation of Offers from Small Business Concerns and Small Business Teaming Arrangement or Joint Ventures (Multiple-Award Contracts) in solicitations for multiple-award contracts above the substantial bundling threshold of the agency.

          PART 19—SMALL BUSINESS PROGRAMS

        14. Amend section 19.201 by revising paragraphs (c)(5)(i), (c)(11)(ii), and (c)(11)(iii) to read as follows:

          19.201
          General policy.

          (c) * * *
          (5) * * *
          (i) Identify proposed solicitations that involve significant bundling and work with the agency acquisition officials and SBA to revise the procurement strategies for such proposed solicitations to increase the probability of participation by small businesses as prime contractors through Small Business Teaming Arrangements;

          (11) * * *
          (ii) Adequacy of consolidated or bundled contract documentation and justifications; and
          (iii) Actions taken to mitigate the effects of necessary and justified consolidation of contract requirements or contract bundling on small businesses.

        15. Amend section 19.202-1 by revising paragraphs (e)(1)(iii), (e)(2), (e)(2)(v), (e)(3), and (e)(4) to read as follows:

          19.202-1
          Encouraging small business participation in acquisitions.

          (e)(1) * * *
          (iii) The proposed acquisition is for a consolidated or bundled requirement. (See 7.107-5(a) for mandatory 30-day notice requirement to incumbent small business concerns.) The contracting officer shall provide all information relative to the justification for the consolidation of contract requirements or contract bundling, including the acquisition plan or strategy, and if the acquisition involves substantial bundling, the information identified in 7.107-4. The contracting officer shall also provide the same information to the agency Office of Small and Disadvantaged Business Utilization.
          (2) Provide a statement explaining why the—

          (v) The consolidation of contract requirements or bundling is necessary and justified.
          (3) Process the 30-day notification concurrently with other processing steps required prior to the issuance of the solicitation.
          (4) If the contracting officer rejects the SBA procurement center representative's recommendation made in accordance with 19.402(c)(2), document the basis for the rejection and notify the SBA procurement center representative in accordance with 19.505.

          PART 52—SOLICITATION PROVISIONS AND CONTRACT CLAUSES

        16. Add section 52.207-XX to read as follows:

          52.207-XX
          Solicitation of Offers from Small Business Concerns and Small Business Teaming Arrangements or Joint Ventures (Multiple-Award Contracts).
          As prescribed in 7.107-6, insert the following provision:

            Solicitation of Offers From Small Business Concerns and Small Business Teaming Arrangements or Joint Ventures (Multiple-Award Contracts) (Date)
            (a) Definition. Small Business Teaming Arrangement, as used in this provision—
            (1) Means an arrangement where—
            (i) Two or more small business concerns have formed a joint venture; or
            (ii) A potential small business prime contractor (“offeror”) agrees with one or more other small business concerns to have them act as its subcontractors under a specified Government contract. A Small Business Teaming Arrangement between the offeror and its small business subcontractor(s) exists through a written agreement between the parties that—
            (A) Is specifically referred to as a “Small Business Teaming Arrangement” or “Small Business Teaming Agreement”; and
            (B) Sets forth the different responsibilities, roles, and percentages (or other allocations) of work as it relates to the acquisition; and
            (2) May include two business concerns in a mentor-protege relationship so long as both the mentor and the protege are small or the protege is small and the concerns have received an exception to affiliation pursuant to 13 CFR 121.103(h)(3)(ii) or (iii).
            (3) See 13 CFR 121.103(b)(9) regarding the exception to affiliation for offers received from Small Business Teaming Arrangements.
            (b) The Government is soliciting and will consider offers from any responsible source, including responsible small business concerns and offers from Small Business Teaming Arrangements or joint ventures of small business concerns.

          (End of provision)

      [FR Doc. 2015-13421 Filed 6-2-15; 8:45 am]
       BILLING CODE 6820-EP-P


        DEPARTMENT OF COMMERCE
        National Oceanic and Atmospheric Administration
        50 CFR Part 223
        RIN 0648-BC10
        Sea Turtle Conservation; Shrimp Trawling Requirements

          AGENCY:
          National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

          ACTION:
          Proposed rule; withdrawal.

          SUMMARY:

          We (NMFS) have determined that a final rule to withdraw the alternative tow time restriction and require all skimmer trawls, pusher-head trawls, and wing nets (butterfly trawls) rigged for fishing to use turtle excluder devices (TEDs) in their nets is not warranted at this time. Thus, we are discontinuing our Environmental Review process under the National Environmental Policy Act (NEPA) and do not intend to prepare a Final Environmental Impact Statement for this Action. We therefore withdraw our proposed rule to require TEDs in these vessels published May 10, 2012, in the Federal Register.

          DATES:
          The proposed rule published on May 10, 2012 (77 FR 27411), is withdrawn as of February 7, 2013.

          FOR FURTHER INFORMATION CONTACT:
          Michael Barnette, 727-551-5794.

        SUPPLEMENTARY INFORMATION:
        Background

        On May 10, 2012, we published a proposed rule (77 FR 27411) that would require all skimmer trawls, pusher-head trawls, and wing nets (butterfly trawls) to use TEDs in their nets. Subsequently, a notice of availability on a Draft Environmental Impact Statement (DEIS) to Reduce Incidental Bycatch and Mortality of Sea Turtles in the Southeastern U.S. Shrimp Fisheries was published on May 18, 2012 (77 FR 29636). The comment periods for the proposed rule and DEIS ended on July 9 and July 2, 2012, respectively.

        We prepared the DEIS and proposed rule in response to elevated sea turtle strandings in the Northern Gulf of Mexico, particularly throughout the Mississippi Sound area, in 2010 and 2011. Necropsy results indicated a significant number of stranded turtles from both the 2010 and 2011 events likely perished due to forced submergence, which is commonly associated with fishery interactions. The most likely cause of the strandings was thought to be the shrimp fisheries, and, in particular, the inshore skimmer trawl fisheries; for the purposes of this notice, skimmer trawls, pusher-head trawls, and wing nets (butterfly trawls) will be collectively referred to as skimmer trawls or as the skimmer trawl fisheries. Skimmer trawlers are currently authorized to use alternative tow times in lieu of TEDs, pursuant to 50 CFR 223.206(d)(2)(ii)(A)(3). The alternative tow time restrictions limit tow times to a maximum of 55 minutes from April 1 through October 31, and 75 minutes from November 1 through March 31. The DEIS and proposed rule noted compliance issues with the alternative tow time restrictions by skimmer trawl vessels, which could result in mortality of sea turtles. Based on new information discussed below, our previous conclusions regarding the impact of non-compliance with tow time restrictions in the skimmer trawl fleet were likely overly conservative and the DEIS mortality estimates likely do not reflect actual fishery impacts on sea turtles.
        At the time the DEIS was prepared, we had extremely limited information on the effects of the skimmer trawl fisheries on sea turtle populations. During this past summer, we shifted observer effort from the offshore otter shrimp trawl fishery to the inshore skimmer trawl fisheries in the Northern Gulf of Mexico to obtain more information on the potential impacts to sea turtle populations. Between May and July 2012, observers reported the capture of 24 sea turtles on skimmer trawl vessels, all of which were Kemp's ridley sea turtles. Tow times ranged from 24 to 128 minutes, with approximately 20 percent being over 70 minutes, with an average tow time of 57 minutes. While only 35 percent of tows were within the required 55-minute tow time limit, all sea turtles were released alive. One turtle was initially comatose but became active while on deck before release. Additionally, all observed sea turtles were small, juvenile specimens, and approximately 58 percent of these turtles had a body depth that could allow them to pass between the required maximum 4-inch bar spacing of a TED.
        Using catch per unit effort (CPUE) from the recent summer observer coverage, we completed new estimates of sea turtle captures within the Gulf of Mexico skimmer trawl fisheries. Additionally, we applied a summer mortality rate based on the 2012 observer data to calculate estimated mortalities of sea turtles within the skimmer trawl fisheries currently operating without TEDs. While all observed sea turtle captures were released alive, one turtle was originally boated in a comatose state. Based on National Research Council (1990) recommendations, this turtle was scored as a mortality to be conservative and account for real-world fishery conditions where turtles may not be properly resuscitated before being released.
        To evaluate the effects of requiring TEDs in the Gulf of Mexico skimmer trawl fisheries, we modified our approach from the DEIS based on advice from the Southeast Fisheries Science Center's (SEFSC) regarding the utilization and limitations of the summer observer coverage data. The new approach accounted for the significant number of small turtles that might pass between the deflector bars of a TED and back into the bag of the trawl net, and also examined less optimistic compliance scenarios should TEDs be required in the skimmer trawl fisheries. Since the majority of skimmer trawls operate in Louisiana state waters where federal TED requirements are not enforced by Louisiana state law enforcement (due to state legislation and significant resistance to the original sea turtle conservation efforts in the shrimp fishery), we would not expect high compliance immediately following potential rule implementation. While compliance has likely fluctuated over the years, it took the offshore otter trawl fishery over 20 years of implementation and 2 years of intensive outreach and enforcement efforts to achieve an estimated 84 percent TED effectiveness rate. Therefore, we estimated sea turtle captures and mortalities under a potential TED requirement for the skimmer trawl fisheries based on staggered rates of TED effectiveness. Specifically, we assumed TED effectiveness would be 65 percent for years 1-2 following implementation, 75 percent for years 3-4, and, ultimately, 84 percent for year 5 and into the future. To account for the issue of small turtles potentially passing through the deflector bars, we estimated a range, assuming that roughly one-third to one-half of the small turtles would not be excluded by the TED but would pass through the bars and be exposed to a higher mortality rate in the bag of the trawl.
        Also, the mortality rate for small turtles that pass through the bars and into the bag of the net, and for other turtles that do not escape the TED due to compliance issues that impact TEDs' effectiveness, was based on long tow times (i.e., 102 minutes) as modeled by Sasso and Epperly (2006). The assumption is that with an installed TED, vessels would not be limited by a 55 or 75 minute tow time (depending on season), and would likely tow for longer periods. However, actual tow times may be dictated by environmental conditions (e.g., debris issues) or navigational requirements (e.g., tight or irregular water bodies, such as bayous along the Louisiana coast). In areas where vessels need to clear their nets of debris or raise their gear to navigate, tow times may be on average shorter than compared to skimmer vessels operating in larger, open water bodies (e.g., Mississippi Sound). Therefore, based on past experience recording tow times prior to the observer coverage, we determined a mortality rate corresponding to a tow time of 102 minutes accounted for the potential changes in fishing behavior as a result of the proposed rule.
        The revised capture and mortality estimates indicated the Gulf of Mexico skimmer trawl fisheries result in 1,893 sea turtle mortalities per year as they currently operate (versus 2,066-6,386 sea turtle mortalities estimated for the Gulf of Mexico in the DEIS). Sea turtle mortalities resulting from the Gulf of Mexico skimmer trawl fisheries under a with-TED scenario were estimated to be 1,977-2,219 for years 1-2; 1,576-1,855 for years 3-4; and 1,217-1,530 for years 5 and on.

        In contrast to the estimates included in the DEIS, the revised capture and mortality estimates indicate that the potential benefits of a TED requirement in the Gulf of Mexico skimmer trawl fisheries are significantly less than previously estimated in the DEIS. Therefore, given the potentially significant economic ramifications a TED requirement would have on fishermen participating in the inshore skimmer trawl fisheries combined with highly uncertain ecological benefits to sea turtle populations compared to the status quo based on the new observer data, we concluded a final rule to require all skimmer trawls, pusher-head trawls, and wing nets (butterfly trawls) in the Gulf of Mexico to use TEDs in their nets is not warranted at this time, and are withdrawing our proposed rule.

        Observer coverage has also been initiated in 2012 for the North Carolina skimmer trawl fishery, but new data are currently unavailable. Caution would be prudent when considering the DEIS estimates and conclusions for the North Carolina fishery, given the insight obtained on the skimmer trawl fisheries in the Northern Gulf of Mexico (e.g., average tow times and mortality rates). For instance, estimating sea turtle mortalities based on the proxy of a 102-minute average tow time is most likely overly conservative for the North Carolina fleet given the 57-minute average tow time documented in the summer observer coverage work for the Gulf of Mexico skimmer trawl fisheries. Further, our previous CPUE rates and information on species composition and size classes for North Carolina is extrapolated from only three captures. The observer information from this past summer's work in the Gulf of Mexico significantly changed our understanding of these important variables. Therefore, we believe pursuing a final rule strictly for the North Carolina skimmer trawl fishery is also unwarranted at this time.
        We believe additional observer effort is necessary to evaluate the potential effects of the skimmer trawl fisheries on sea turtle populations. In particular, we would like to have information on interactions during winter months, which have not been sampled, and for which we have not been able to update the analysis used in the DEIS. Additionally, extended observer sampling in the Northern Gulf of Mexico during summer months is needed to determine if this year's observed interactions, particularly the prevalence of very small Kemp's ridley sea turtles, were an anomaly based on oceanographic conditions or the impact of strong recruitment from increased nesting success of Kemp's ridley sea turtles, which could be expected to continue into the future. The prevalence of these very small turtles has potentially significant implications for future management directions, and needs to be better understood.
        We also expect to explore technological solutions to address the small turtle issue, such as conducting TED feasibility and catch loss studies on TEDs with bar spacing less than 4 inches. Additional observer data and an analysis of the size of turtles interacting with the inshore skimmer trawl fisheries would be pursued to determine TED bar spacing that would maximize benefits to sea turtle conservation. Our objective is to have sufficient information to evaluate a potential proposed rule that would be effective in reducing sea turtle bycatch in the inshore skimmer trawl fisheries in the near future.
        Additionally, we believe there is a need to explore if there are better criteria to determine mortality in trawl fisheries. In consultation with relevant experts, the agency will examine this issue and produce a report with our findings and any new criteria that may be developed.
        Concurrently, we expect to improve outreach efforts with industry to address compliance issues with tow time requirements observed in the inshore skimmer trawl fisheries. Numerous requests to strengthen outreach, specifically in regards to education on tow time requirements, were received from the public and industry during the comment periods for the proposed rule and DEIS. These outreach efforts would likely improve compliance and, therefore, decrease sea turtle mortality in the inshore skimmer trawl fisheries in the near term.
        References
        National Research Council. 1990. Decline of the Sea Turtles: Causes and Prevention. National Academy Press, Washington, DC. 259 pp.
        Sasso, C.R. and S.P. Epperly. 2006. Seasonal sea turtle mortality risk from forced submergence in bottom trawls. Fisheries Research 81:86-88.

          Dated: February 4, 2013.
          Alan D. Risenhoover,
          Director, Office of Sustainable Fisheries, performing the functions and duties of the Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service.

      [FR Doc. 2013-02786 Filed 2-6-13; 8:45 am]
      BILLING CODE 3501-22-P


        DEPARTMENT OF COMMERCE
        National Oceanic and Atmospheric Administration
        50 CFR Part 665
        [Docket No. 0612242967-7394-01]
        RIN 0648-AS71
        Fisheries in the Western Pacific; Pelagic Fisheries; Squid Jig Fisheries

          AGENCY:
          National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

          ACTION:
          Proposed rule; request for comments.

          SUMMARY:
          This proposed rule would include three species of pelagic squid under Federal management, and establish permitting and reporting requirements for squid jig fishing vessels over 50 ft (15.4 m) in length. These vessels would also be required to carry Federal observers if requested by NMFS. This proposed rule is intended to improve monitoring and management of U.S. domestic pelagic squid fisheries in the western Pacific.

          DATES:
          Comments on this proposed rule must be received by October 14, 2008.

          ADDRESSES:
          Comments on the amendment, identified by 0648-AS71, may be sent to either of the following addresses:
          • Electronic Submission: Federal e-Rulemaking Portal www.regulations.gov; or
          • Mail: William L. Robinson, Regional Administrator, NMFS, Pacific Islands Region (PIR), 1601 Kapiolani Blvd, Suite 1110, Honolulu, HI 96814-4700.

          Instructions: All comments received are a part of the public record and will generally be posted to www.regulations.gov without change. All personal identifying information (e.g., name, address, etc.) submitted voluntarily by the commenter may be publicly accessible. Do not submit confidential business information, or otherwise sensitive or protected information. NMFS will accept anonymous comments (if you wish to remain anonymous, enter “NA” in the required name and organization fields). Attachments to electronic comments will be accepted in Microsoft Word or Excel, WordPerfect, or Adobe PDF file formats only.

          Copies of the Fishery Management Plan for Pelagic Fisheries of the Western Pacific Region (Pelagics FMP), and proposed Amendment 15 including an environmental assessment (EA), are available from the Western Pacific Fishery Management Council (Council), 1164 Bishop St., Suite 1400, Honolulu, HI 96813, tel 808-522-8220, fax 808-522-8226, or www.wpcouncil.org.

          FOR FURTHER INFORMATION CONTACT:
          Bob Harman, NMFS PIR, 808-944-2271.

        SUPPLEMENTARY INFORMATION:
        This Federal Register document is also accessible at the Office of the Federal Register website: www.gpoaccess.gov/fr.
        The pelagic fisheries of the U.S. western Pacific are managed under the Pelagics FMP, which was developed by the Council, and approved and implemented by NMFS. The Council has submitted Pelagics FMP Amendment 15 to NMFS for review under the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act). This proposed rule would implement the management provisions recommended in Amendment 15, if approved by the Secretary of Commerce. Although no squid resource concerns have arisen to date, effective monitoring programs and mechanisms to implement management measures are both needed. To address these needs, the Council recommends in Amendment 15 improving data on U.S. squid fisheries through new permitting, monitoring and reporting requirements, as follows:

        • Add three pelagic squid species to the pelagic management unit (neon flying squid, Ommastrephes bartramii, diamondback squid, Thysanoteuthis rhombus, and purple flying squid, Sthenoteuthis oualaniensis); and
        • Require operators of U.S. vessels greater than 50 ft (15.4 m) in length overall that fish for pelagic squid in waters of the U.S. Exclusive Economic Zone (EEZ) of the western Pacific to:
        i. obtain Federal permits;
        ii. carry Federal observers if requested by NMFS; and
        iii. report any western Pacific pelagic squid catch and effort either in Federal squid logbooks or via existing local reporting systems.
        These measures, if implemented, would provide additional data and a mechanism for the Council and NMFS to effectively monitor and manage the U.S. domestic pelagic squid fisheries.
        Pelagic squid are widely dispersed and short-lived, with relatively high reproduction rates. Thus, populations recover quickly following declines and are difficult to over-harvest with relatively inefficient fishing methods such as jigging. For example, stock abundance of neon flying squid in the central North Pacific was low in 1993, probably due to high fishing mortality from the high seas drift gillnet fishery. That fishery was banned in 1992, and the stocks quickly recovered and abundance was high during 1994-96. Stock abundance was again depressed in 1997 (the most prominent El Nino year in the last century), but was high in 1998. There is no evidence of over-harvesting of pelagic squid stocks on the high seas or in EEZ waters around U.S. islands in the western Pacific.
        Pelagic squid are targeted by food and bait fisheries throughout the Pacific. They are a major component of the pelagic ecosystem, with large species preying on a variety of fish and invertebrate species, and smaller species providing important forage components for species such as swordfish and pilot whales. This “keystone” role of squid in the trophic web suggests that squid may be an important indicator of ecosystem dynamics. An international, large-scale, multi-species squid jigging fishery exists on the Pacific high seas, including foreign and a few U.S. fishing vessels. The Japanese jigging fleet was once dominant in the North Pacific, but is now rivaled by a growing Chinese fleet. The fishery is seasonal with most vessels switching to the Southern Hemisphere during the southern summer (October-February). Three U.S. squid jig vessels fished for squid in the North Pacific for a month or less in the summer of 2003, catching red flying squid on the high seas and offloading in Japan. Following a disappointing season, they moved to New Zealand waters for the 2003 summer/autumn squid season. To date, these domestic jigging vessels have fished on the high seas or in the waters of other nations, but there is a possibility of moving their fishing activities to U.S. EEZ waters around Hawaii in association with a shift in oceanic conditions. In addition to this large-vessel fishery, a few smaller vessels target purple flying squid with jigs near the Hawaiian Islands. This smaller fishery provides squid for the seafood market, and bait for the tuna handline fishery.
        Although U.S. fisheries in the northern waters of the western Pacific catch a tiny fraction of the total international squid production, data provided by monitoring of these fisheries are, as yet, the only indicator available of squid stock status. The first issue to be addressed in the proposed rule is the need for improved information about U.S. squid jig fisheries. To effectively monitor and manage these fisheries, there is a need to ensure that U.S. catches of squid in the western Pacific are recorded accurately. For fishing on the high seas, the HSFCA requires catch reporting, but to date there has been no specific HSFCA logbook for squid jig fishing. Commercial landings of squid offloaded in Hawaii (regardless of where caught) are required to be reported on Hawaii state catch reports. Recreational catches landed in Hawaii are not subject to any reporting requirements (although recreational squid harvests are believed to be small and are not a concern to resource managers). With the exception of the Pacific remote island areas (PRIA), creel surveys are conducted in the other areas of the U.S. western Pacific to collect data on both commercial and recreational fishing activities. The information collected from these disparate programs have not been compiled for efficient analyses by resource scientists and managers.
        U.S. squid jig vessels that fish only on the high seas in the western Pacific would be required to report their catch and effort using the Federal squid logbooks, pursuant to the reporting and recordkeeping provision of the High Seas Fishing Compliance Act (HSFCA). The reporting requirements of the HSFCA (50 CFR 300.17(b)(3)) provide the necessary regulatory authority for NMFS to require squid jig fishermen to use Federal logbooks that would be implemented under this proposed rule to meet the reporting requirements under both the HSFCA and the Magnuson-Stevens Act.
        In addition to data needs, a second issue regarding the domestic squid jigging fishery is that there is no management mechanism to implement fishery regulatory controls, should concerns arise regarding squid stocks or other aspects of the fishery. Squid resources are healthy, the domestic fishery is relatively small, and there have been no observed or reported interactions with protected species or significant levels of bycatch. Thus, specific management measures (such as time or area closures, or effort or landing limits) are not being considered at this time. However, the establishment of mechanisms to implement management measures would allow for regulatory controls to be put in place if data collected indicate a future need for additional management measures.
        To be considered, comments must be received by close of business on October 14, 2008, not postmarked or otherwise transmitted by that date.

        In addition to soliciting public comments on this proposed rule, NMFS is soliciting comments on proposed Amendment 15 through October 10, 2008 as stated in the Notice of Availability published on August 11, 2008 (73 FR 46580). Public comments on this proposed rule, if received by October 10, 2008, will also be considered in the approval/disapproval decision for Amendment 15. Comments received after that date will not be considered in the approval/disapproval decision for Amendment 15, but will be considered for this proposed rule.
        Classification
        Pursuant to section 304 (b)(1)(A) of the Magnuson-Stevens Act, the NMFS Assistant Administrator has determined that this proposed rule is consistent with the Pelagics FMP, other provisions of the Magnuson-Stevens Act, and other applicable laws, subject to further consideration after public comment.
        Amendment 15 includes an EA that describes the existing squid fishery management and environment, and describes the potential environmental impacts of implementing the provisions of the preferred alternative. The EA tiers off a 2005 Final Environmental Impact Statement (2005 EIS) (70 FR 24038, May 6, 2005), and incorporates by reference the previous environmental impact analysis of the five alternatives considered in Amendment 15, specifically Alternative 1, the no-action alternative, Alternative 2, voluntary monitoring, Alternative 3, mandatory monitoring and management under the Pelagics FMP, Alternative 4, mandatory monitoring and management through a new squid FMP, and Alternative 5, mandatory monitoring and management through international agreements. All of the previous alternatives considered in the April 2005 EIS were coordinated with interested and affected parties. New information about future fishery management policies became available after the 2005 EIS was completed, and an additional alternative (Alternative 3a) was added and analyzed in the EA. Alternative 3a is similar to Alternative 3 in the 2005 EIS, but the revised alternative now contains provisions for mandatory Federal permits and logbooks reporting for vessels greater than 50 ft (15.4 m) in length that fish for squid in the U.S. EEZ waters of the western Pacific, and a requirement to carry Federal observers when requested by NMFS.

        The purpose and need for the proposed action is to establish appropriate monitoring and management mechanisms for the domestic harvest of western Pacific pelagic squid. Based on the information in the EA and the 2005 EIS, as compared to the no-action alternative, preferred Alternative 3a would have no adverse impacts to essential fish habitat or habitat areas of particular concern. None of the action alternatives would be expected to change the impacts of U.S. vessels on squid resources in the short term, but impacts on the resource base could increase with higher future effort, so increasing fishery managers' understanding of the status of the stocks and fishing mortality would be an important outcome of this action. By including pelagic squid as management unit species under the preferred alternative, the foundation would be established for implementing control measures, should they become necessary. None of the action alternatives is anticipated to have any significant adverse impacts on seabird, sea turtle, or marine mammal populations because the fishery has a relatively low level of participation, and there have been no observed or reported interactions with protected resources in either the nearshore Hawaii squid fishery or the U.S. high seas squid jig fishery. The preferred alternative would provide for the sustained participation of fishing communities by helping to ensure the long-term availability of Pacific pelagic squid. The complete analysis of the alternatives is contained in the 2005 EIS and in Amendment 15, and is not repeated here. Copies of these two environmental analytical documents are available from the Council (see ADDRESSES).
        This proposed rule has been determined to be not significant for purposes of Executive Order 12866.
        The Chief Council for Regulation of the Department of Commerce certified to the Chief Council for Advocacy of the Small Business Administration that this proposed rule, if adopted, would not have a significant economic impact on a substantial number of small entities. The analysis follows:

          The Western Pacific Fishery Management Council (Council) prepared Amendment 15 to the Pelagics FMP. Amendment 15 recommends including three species of commercially-harvested pelagic squid (neon flying squid, purple flying squid, and diamondback squid) as pelagic management unit species. Amendment 15 would establish Federal permitting, data reporting, and observer requirements for squid jigging vessels over 50 ft (15.4 m) in length that fish in the U.S. EEZ of the western Pacific, or land these squid in ports of the region. A description of the action, why it is being considered, and the legal basis for this action are contained in the preamble to this proposed rule. This rule does not duplicate, overlap, or conflict with other Federal rules. There are no disproportionate economic impacts from this rule based on homeport, gear type, or relative vessel size. Pursuant to section 605(b) of the Regulatory Flexibility Act, 5 U.S.C. § 605(b), NMFS has determined that this rule will not have a significant economic impact on a substantial number of small entities based on the pre-existing status of pelagic squid fisheries within the U.S. EEZ of the central and western Pacific. All vessels having the potential to participate in this fishery are considered to be small entities under the current Small Business Administration definition of small fish-harvesting businesses (gross receipts not in excess of $ 4.0 million, independently owned and operated, and not dominant in their field).
          This proposed rule would improve mandatory monitoring and establish mechanisms for management by including these squids in the management unit. This rule would require U.S. vessels greater than 50 ft (15.4 m) in length overall that fish for pelagic squid in U.S. Pacific EEZ to obtain Federal permits, to carry observers if requested by NMFS, and to report their catch and effort using either NMFS western Pacific squid jigging logbooks or existing local reporting systems. High seas squid harvests would be reported in the squid jigging logbooks. The fishery data would be centralized into a database easily available to resource scientists and managers.
          An international, large-scale squid jigging fishery (multi-species) exists on the Pacific high seas. This includes both foreign and, until recently, a few domestic (U.S. flagged) fishing vessels. Three U.S. flagged squid jiggers fished for squid in the North Pacific in the summer of 2003, catching neon flying squid before traveling to the Southern Hemisphere. (The fishery is seasonal with most vessels switching to the Southern Hemisphere during the southern summer, October-February.) The operation consisted of a mother ship, 47 m long with 38 jigging machines, and holding up to 453,600 kg of squid, with a crew of 18. The other three boats ranged from 32-34 m in length. Each had 21-38 jigging machines, holding 204,100 to 386,000 kg of squid, with crews of 12. Blast freezers were installed on board all four boats. While squid catches as high as 8,000 kg per vessel per night have been reported by some operations, the recent domestic operation in the North Pacific caught a combined total of 20,253 kg of red flying squid for three vessels fishing over 22 days in 2003.
          In addition, a small nearshore squid jigging fishery operating out of Kauai and a tuna handline fishery operating primarily from the Big Island of Hawaii have been known to target purple flying squid for food and/or bait. Although significant in the 1970s and 1980s, current participation in this fishery is now estimated to consist of only a few vessels. Nonetheless, due to shifts in both economic and oceanic conditions, there exists the potential for domestic squid jigging effort to shift from the high seas to the U.S. EEZ around Hawaii.

          Economic impacts of the preferred alternative would have a slightly adverse economic impact in the requirement to pay a vessel permit fee of approximately $30. Using average prices for squid sold in Hawaii during the summer of 2003 ($1.81/lb), a permit fee of $30 represents only 0.15% of the average boat revenue for the known boats jigging for squid in the North Pacific during 2003. The largest potential impact to affected participants is the observer requirement for vessels greater than 50 ft (15.4 m) in length overall contained in the preliminarily preferred alternative. Assuming that the costs of deploying (paying and feeding) observers would be paid by NMFS (as has been the case in the western Pacific region to date), vessel operators will still incur some indirect costs. Limited bunk or deck space may require vessel operators to reduce the number of crew in order to accommodate observers, resulting in a decrease in the operating efficiency of the remaining crew. There may be additional costs if vessel operators choose to carry additional liability insurance (beyond that provided by NMFS for its observers). These costs would vary between individual vessels depending on the insurance carriers' minimum allowed coverage period, and the coverage approach that is taken. The number of entities that will be required to carry observers is unknown as the appropriate level of observer coverage has not been determined, however, given that no vessels of this size have fished for pelagic squid in Pacific U.S. EEZ waters without landing them in the U.S.A. to date, this burden may be minimal. It is possible that a squid fishery observer program could operate on an intermittent basis if the low levels of bycatch and protected species interactions believed to occur are confirmed. The remaining aspects of the preferred alternative consist of the requirement for vessels greater than 50 ft (15.4 m) in length overall to obtain Federal permit and to either complete new Federal logbooks or to participate in local reporting systems.
          Because there are no fishery-management controls associated with this measure that affect the operations of the fishery other than potentially carrying observers, significant impacts to the profitability of a substantial number of small entities are not anticipated and there will be no disproportionate impact between gear types, vessels or port of landing. As a result, an initial regulatory flexibility analysis is not required and none has been prepared.

        This proposed rule contains collection-of-information requirements subject to review and approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act (PRA). These requirements have been submitted to OMB for approval. The preferred alternative would require the owners of all U.S. vessels greater than 50 ft (15.4 m) in length that conduct commercial squid jig fishing for squid in U.S. EEZ waters around the islands of the western Pacific to obtain Federal fishing permits, and the vessel operators would be required to complete and submit Federal catch reports, or report via local reporting systems where such systems exist. Permit eligibility would not be restricted in any way, and the permit would be renewable on an annual basis.
        NMFS anticipates that initial permit applications would require 0.5 hours per applicant, with renewals requiring an additional 0.5 hours annually. It is estimated that NMFS may receive and process up to 30 permit applications each year. Thus, the total collection-of-information burden to fishermen for permit applications is estimated at 15 hours per year. The cost for individual Federal permits has not been determined, but would represent only the administrative cost and is anticipated to be approximately $30 per permit.
        NMFS anticipates the time requirement to complete Federal catch reports to be approximately 10 minutes per vessel per fishing day. Assuming that the 30 vessels fish during up to 100 days per year, the total collection-of-information burden estimate for fishing data reporting is estimated at 500 hours per year.

        These estimates include the time for reviewing instructions, searching and compiling existing data sources, and completing and reviewing the collection information. Public comment is sought regarding: whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the burden estimates; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the collection of information, including through the use of automated collection techniques or other forms of information technology. Send comments on these or any other aspects of the collection of information to William L. Robinson (see ADDRESSES), and by email to David_Rostker@omb.eop.gov or by fax to 202-395-7285.
        Notwithstanding any other provision of the law, no person is required to respond to, and no person shall be subject to penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number.

          List of Subjects in 50 CFR Part 665
          Administrative practice and procedure, American Samoa, Fisheries, Fishing, Guam, Hawaii, Hawaiian Natives, Northern Mariana Islands, Pacific remote island areas, Reporting and recordkeeping requirements.

          Dated: August 22, 2008.
          Samuel D. Rauch III,
          Deputy Assistant Administrator For Regulatory Programs, National Marine Fisheries Service.

        For the reasons set out in the preamble, 50 CFR part 665 is proposed to be amended as follows:

          PART 665—FISHERIES IN THE WESTERN PACIFIC

        1. The authority citation for part 665 continues to read as follows:

          Authority:
          16 U.S.C. 1801 et seq.

        2. In § 665.12, amend the definition for “Pacific Pelagic Management Unit Species,” by adding three squid species to the end of the table, and add a definition for “Squid jig fishing” in alphabetical order to read as follows:

          § 665.12
          Definitions.

            Pacific Pelagic Management Unit Species * * *

              Common name
              Scientific name

              *        *         *        *         *

              Squid:

              Diamondback squid

                Thysanoteuthis rhombus

              Neon flying squid

                Ommastrephes bartramii

              Purple flying squid

                Sthenoteuthis oualaniensis

            Squid jig fishing means fishing for squid that are Pelagic management unit species using a hook or hooks attached to a line that is raised and lowered in the water column by manual or mechanical means.

          3. In § 665.13, revise paragraphs (f)(2)(i) through (f)(2)(v), and add a new paragraph (f)(2)(vi) to read as follows:

          § 665.13
          Permits and fees.

          (f) Fees. * * *
          (2) * * *
          (i) Hawaii longline limited access permit.
          (ii) Mau Zone limited access permit.
          (iii) Coral reef ecosystem special permit
          (iv) American Samoa longline limited access permit.
          (v) Main Hawaiian Islands non-commercial bottomfish permit.
          (vi) Western Pacific squid jig permit.

          4. In § 665.14, revise paragraph (a)(1) to read as follows:

          § 665.14
          Reporting and recordkeeping.
          (a) Fishing record forms. (1) Applicability. (i) The operator of any fishing vessel subject to the requirements of §§ 665.21, 665.41, 665.61(a)(2), 665.61(a)(3), 665.61(a)(4), 665.81, or 665.602 must maintain on board the vessel an accurate and complete record of catch, effort, and other data on paper report forms provided by the Regional Administrator, or electronically as specified and approved by the Regional Administrator, except as allowed in paragraph (a)(1)(iii) of this section.
          (ii) All information specified by the Regional Administrator must be recorded on paper or electronically within 24 hours after the completion of each fishing day. The logbook information, reported on paper or electronically, for each day of the fishing trip must be signed and dated or otherwise authenticated by the vessel operator in the manner determined by the Regional Administrator, and be submitted or transmitted via an approved method as specified by the Regional Administrator, and as required by this paragraph (a).
          (iii) In lieu of the requirements in paragraph (a)(1)(i) of this section, the operator of a fishing vessel registered for use under a Western Pacific squid jig permit pursuant to the requirements of § 665.21(g) may participate in a state reporting system. If participating in a state reporting system, all required information must be recorded and submitted in the exact manner required by applicable state law or regulation.

          5. In § 665.21, redesignate paragraphs (g) through (n) as paragraphs (h) through (o), and add a new paragraph (g) to read as follows:

          § 665.21
          Permits.

          (g) A vessel of the United States must be registered for use under a Western Pacific squid jig fishing permit, if that vessel is more than 50 ft (15.4 m) in length overall and is used to squid jig fish in EEZ waters around American Samoa, the CNMI, Guam, the Hawaiian Archipelago, or the PRIA.

        6. In § 665.22 add new paragraph (zz) to read as follows:

          § 665.22
          Prohibitions.

          (zz) Use a vessel that is greater than 50 ft (15.4 m) in length overall to squid jig fish in EEZ waters around American Samoa, the CNMI, Guam, the Hawaiian Archipelago, or the PRIA, without a Western Pacific squid jig fishing permit registered for use with that vessel, in violation of § 665.21(g).

        7. In § 665.23, revise paragraph (a), redesignate paragraphs (b) and (c) as paragraphs (d) and (e), and add new paragraphs (b) and (c) to read as follows:

          § 665.23
          Notifications.
          (a) The permit holder, or designated agent, for any vessel registered for use under a Hawaii longline limited access permit, or for any vessel greater than 40 ft (12.2 m) in length overall that is registered for use under an American Samoa longline limited access permit, shall provide a notice to the Regional Administrator at least 72 hours (not including weekends and Federal holidays) before the vessel leaves port on a fishing trip, any part of which occurs in the EEZ around the Hawaiian Archipelago or American Samoa. The vessel operator will be presumed to be an agent designated by the permit holder unless the Regional Administrator is otherwise notified by the permit holder. The permit holder or designated agent for a vessel registered for use under Hawaii longline limited access permits must also provide notification of the trip type (either deep-setting or shallow-setting).
          (b) The permit holder, or designated agent, for any vessel registered for use under a Western Pacific squid jig fishing permit that is greater than 50 ft (15.4 m) in length overall, shall provide a notice to the Regional Administrator at least 72 hours (not including weekends and Federal holidays) before the vessel leaves port on a fishing trip, any part of which occurs in Western Pacific waters. The vessel operator will be presumed to be an agent designated by the permit holder unless the Regional Administrator is otherwise notified by the permit holder.
          (c) For purposes of this section, the notice must be provided to the office or telephone number designated by the Regional Administrator. The notice must provide the official number of the vessel, the name of the vessel, the intended departure date, time, and location, the name of the operator of the vessel, and the name and telephone number of the permit holder or designated agent to be available between 8 a.m. and 5 p.m. (local time) on weekdays for NMFS to contact to arrange observer placement.

      [FR Doc. E8-20004 Filed 8-27-08; 8:45 am]
      BILLING CODE 3510-22-S