        DEPARTMENT OF THE INTERIOR
        Fish and Wildlife Service
        50 CFR Part 17
        [Docket No. FWS-R8-ES-2008-0089; 81420-1117-8B10 B4]
        RIN 1018-AV90
        Endangered and Threatened Wildlife and Plants; Revised Designation of Critical Habitat for the California Red-Legged Frog (Rana aurora draytonii)

          AGENCY:
          Fish and Wildlife Service, Interior.

          ACTION:
          Proposed rule; reopening of comment period, availability of revised draft economic analysis, and amended required determinations.

          SUMMARY:
          We, the U.S. Fish and Wildlife Service (Service), announce the reopening of the comment period on our September 16, 2008, and April 28, 2009, proposal to revise the designation of critical habitat for the California red-legged frog under the Endangered Species Act of 1973, as amended (Act). We also announce the availability of a revised draft economic analysis (DEA). We are reopening the comment period to allow all interested parties an opportunity to comment simultaneously on the proposed revision of critical habitat and the associated revised DEA. Comments previously submitted on this rulemaking do not need to be resubmitted. These comments have already been incorporated into the public record and will be fully considered in preparation of the final rule.

          DATES:
          We will accept comments received on or before November 9, 2009.

          ADDRESSES:
          You may submit comments by one of the following methods:
          • Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments to Docket No. FWS-R8-ES-2008-0089.
          • U.S. mail or hand-delivery: Public Comments Processing, Attn: FWS-R8-ES-2008-0089; Division of Policy and Directives Management; U.S. Fish and Wildlife Service; 4401 N. Fairfax Drive, Suite 222; Arlington, VA 22203.

          We will not accept e-mail or faxes. We will post all comments on http://www.regulations.gov. This generally means that we will post any personal information you provide us (see the Public Comments section below for more information).

          FOR FURTHER INFORMATION CONTACT:
          Susan Moore, Field Supervisor, U.S. Fish and Wildlife Service, Sacramento Fish and Wildlife Office, 2800 Cottage Way, Room W-2605, Sacramento, CA 95825; telephone 916-414-6600; facsimile 916-414-6712. If you use a telecommunications device for the deaf (TDD), call the Federal Information Relay Service (FIRS) at 800-877-8339.

        SUPPLEMENTARY INFORMATION:

        Public Comments

        We will accept written comments and information during this reopened comment period on our proposed revision to critical habitat for the California red-legged frog published in the Federal Register on September 16, 2008 (73 FR 53492), and revised in the Federal Register on April 28, 2009 (74 FR 19184), and the current revised DEA (IEc 2009b) of the proposed revised designation. We will consider information and recommendations from all interested parties. We are particularly interested in comments concerning:

        (1) The reasons why we should or should not designate habitat as critical habitat under section 4 of the Act (16 U.S.C. 1531 et seq.), including whether there are threats to the subspecies from human activity, the degree of which can be expected to increase due to the designation, and whether that increase in threat outweighs the benefit of designation such that the designation of critical habitat is not prudent.
        (2) Specific information on:
        • The amount and distribution of California red-legged frog habitat,
        • Locations within the geographical area occupied at the time of listing that contain features essential to the conservation of the subspecies that we should include in the designation and why, and
        • Locations not within the geographical area occupied at the time of listing that are essential to the conservation of the subspecies and why.
        (3) Land use designations and current or planned activities in the subject areas and their possible impacts on proposed revised critical habitat.
        (4) Probable economic, national security, or other relevant impacts of designating particular areas as critical habitat. We are particularly interested in any impacts on small entities, and the benefits of including or excluding areas that exhibit these impacts.
        (5) The potential exclusion from final revised critical habitat, and whether such exclusion is appropriate and why, of non-Federal lands:
        • Covered by the East Contra Costa County Habitat Conservation Plan (ECCHCP),
        • Owned and managed by the East Bay Regional Park District within the boundaries of the ECCHCP,
        • Covered by the Western Riverside County Multiple Species Habitat Conservation Plan (MSHCP), and
        • Covered by the Bonny Doon Settlement Ponds Habitat Conservation Plan.
        (6) Whether the lands proposed as critical habitat on Department of Defense land at Vandenberg Air Force Base in Santa Barbara County and Camp San Luis Obispo in San Luis Obispo County should be exempted under section 4(a)(3) of the Act or excluded under section 4(b)(2) of the Act and why.
        (7) Whether the U.S. Forest Service lands managed under the Sierra Nevada Forest Plan Amendment within the units being proposed as critical habitat should be excluded under section 4(b)(2) of the Act and why.
        (8) Whether Unit CAL-1 (Young's Creek) in Calaveras County should be excluded under section 4(b)(2) of the Act and why.
        (9) Whether changes made to the proposed critical habitat Unit MEN-1 in Mendocino County appropriately reflect the current knowledge of the subspecies distribution and occurrence within the area and whether that area should be designated as critical habitat.
        (10) Information on the extent to which any Federal, State, and local environmental protection measures we reference in the revised DEA were adopted largely as a result of the subspecies' listing.
        (11) Information on whether the revised DEA identifies all Federal, State, and local costs and benefits attributable to the proposed revision of critical habitat, and information on any costs or benefits that we may have overlooked.
        (12) Information on whether the revised DEA makes appropriate assumptions regarding current practices and any regulatory changes that likely may occur if we designate revised critical habitat.

        (13) Information on whether the revised DEA correctly assesses the effect on regional costs associated with any land use controls that may result from the revised designation of critical habitat.
        (14) Information on areas that the revised critical habitat designation could potentially impact to a disproportionate degree.
        (15) Information on whether the revised DEA identifies all costs that could result from the proposed revised designation.
        (16) Information on any quantifiable economic benefits of the revised designation.
        (17) Whether the benefits of excluding any particular area outweigh the benefits of including that area under section 4(b)(2) of the Act.
        (18) Economic data on the incremental costs of designating a particular area as revised critical habitat.
        (19) Whether we could improve or modify our approach to designating critical habitat to provide for greater public participation and understanding, or assist us in accommodating public concerns and comments.
        (20) Any foreseeable impacts on energy supplies, distribution, and use resulting from the proposed designation and, in particular, any impacts on electricity production, and the benefits of including or excluding areas that exhibit these impacts.
        If you submitted comments or information on the proposed revised rule (73 FR 53492) during the initial comment period from September 16, 2008, to November 17, 2008, or the comment period on the revised proposal (74 FR 19184) from April 28, 2009, to May 28, 2009, please do not resubmit them. These comments are included in the public record for this rulemaking, and we will fully consider them in the preparation of our final determination. Our final determination concerning revised critical habitat will take into consideration all written comments and any additional information we receive during both comment periods. On the basis of public comments, we may, during the development of our final determination, find that areas within those proposed do not meet the definition of critical habitat, that some modifications to the described boundaries are appropriate, or that areas are appropriate for exclusion under section 4(b)(2) of the Act.

        You may submit your comments and materials concerning the proposed revised rule or DEA by one of the methods listed in the ADDRESSES section.
        If you submit a comment via http://www.regulations.gov, your entire comment—including any personal identifying information—will be posted on the Web site. If you submit a hardcopy comment that includes personal identifying information, you may request at the top of your document that we withhold this information from public review. However, we cannot guarantee that we will be able to do so. We will post all hardcopy comments on http://www.regulations.gov.

        Comments and materials we receive, as well as supporting documentation we used in preparing this proposed revised rule, will be available for public inspection on http://www.regulations.gov, or by appointment, during normal business hours, at the U.S. Fish and Wildlife Service, Sacramento Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT).

        You may obtain copies of the original proposed revision of critical habitat and associated DEA on the Internet at http://www.regulations.gov, on the Sacramento Fish and Wildlife Office Web page at http://www.fws.gov/sacramento, or by contacting the Sacramento Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT).
        Background

        Critical habitat for the California red-legged frog was first designated on March 13, 2001 (66 FR 14625), and has been revised several times since then. For more information on previous Federal actions concerning the California red-legged frog, refer to the proposals to revise the designation of critical habitat published in the Federal Register on September 16, 2008 (73 FR 53492), and on April 28, 2009 (74 FR 19184). Comments received on our previous Draft Economic Analysis (DEA) (IEc 20009a) during the second public comment period led to this revised DEA.

        On December 12, 2007, the Center for Biological Diversity filed a complaint in the U.S. District Court for the Northern District of California challenging our designation of critical habitat for the California red-legged frog (Center for Biological Diversity v. Kempthorne, et al., Case No. C-07-6404-WHA). On April 2, 2008, the court entered a consent decree requiring a proposed revised critical habitat rule to be submitted to the Federal Register by August 29, 2008, and a final revised critical habitat designation to be submitted to the Federal Register by August 31, 2009. The consent decree was modified on August 31, 2009, and now requires that we submit a final revised critical habitat designation to the Federal Register by March 1, 2010.
        Section 3 of the Act defines critical habitat as the specific areas within the geographical area occupied by a species, at the time it is listed in accordance with the Act, on which are found those physical or biological features essential to the conservation of the species which may require special management considerations or protection, and specific areas outside the geographical area occupied by a species at the time it is listed, upon a determination that such areas are essential for the conservation of the species. If the proposed rule is made final, section 7 of the Act will prohibit destruction or adverse modification of critical habitat by any activity funded, authorized, or carried out by any Federal agency. Federal agencies proposing actions affecting areas designated as critical habitat must consult with us on the effects of their proposed actions, under section 7(a)(2) of the Act.
        Under section 4(b)(2) of the Act, we may exclude an area from critical habitat if we determine that the benefits of such exclusion outweigh the benefits of including that particular area as critical habitat, unless failure to designate that specific area as critical habitat will result in the extinction of the species. In making a decision to exclude areas, we consider the economic impact, impact on national security, or any other relevant impact of the designation.
        Draft Economic Analysis
        Section 4(b)(2) of the Act requires that we designate or revise critical habitat based upon the best scientific and commercial data available, after taking into consideration the economic impact, impact on national security, or any other relevant impact of specifying any particular area as critical habitat. We have prepared a revised DEA of our April 28, 2009 (74 FR 19184), proposed rule to revise designated critical habitat for the California red-legged frog.

        The intent of the revised DEA (IEc 2009b) is to identify and analyze the potential economic impacts associated with the proposed revised critical habitat designation for the California red-legged frog. Additionally, the economic analysis looks retrospectively at costs incurred since the May 23, 1996 (61 FR 25813), listing of the California red-legged frog as threatened. The revised DEA quantifies the economic impacts of all potential conservation efforts for the California red-legged frog; some of these costs will likely be incurred regardless of whether we designate revised critical habitat. The economic impact of the proposed revised critical habitat designation is analyzed by comparing scenarios both “with critical habitat” and “without critical habitat.” The “without critical habitat” scenario represents the baseline for the analysis, considering protections already in place for the subspecies (for example, under the Federal listing and other Federal, State, and local regulations). The baseline, therefore, represents the costs incurred regardless of whether critical habitat is designated. The “with critical habitat” scenario describes the incremental impacts associated specifically with the designation of critical habitat for the subspecies. The incremental conservation efforts and associated impacts are those not expected to occur absent the designation of critical habitat for the subspecies. In other words, the incremental costs are those attributable solely to the designation of critical habitat above and beyond the baseline costs; these are the costs we may consider in the final designation of critical habitat. The analysis looks retrospectively at baseline impacts incurred since the subspecies was listed, and forecasts both baseline and incremental impacts likely to occur if we finalize the proposed revised critical habitat.
        The revised DEA estimates the reasonably foreseeable economic impacts of the proposed revised critical habitat designation. The economic analysis identifies potential incremental costs as a result of the proposed revised critical habitat designation; these are those costs attributed to critical habitat over and above those baseline costs attributed to the subspecies being listed within the Act. The revised DEA describes economic impacts of California red-legged frog conservation efforts associated with the following categories of activity: (1) Residential and Commercial Development; (2) Water Management; (3) Agriculture; (4) Ranching and Grazing; (5) Timber Harvest; (6) Transportation; (7) Fire Management; (8) Utility and Oil and Gas Pipeline Construction and Maintenance; and (9) Habitat and Vegetation Management.
        The baseline economic impacts are those impacts that result from listing and other conservation efforts for the California red-legged frog. Conservation efforts related to development activities constitute the majority of total baseline costs (approximately 77 to 82 percent) in areas of proposed revised critical habitat. Impacts to agriculture make up the majority of the remainder of the costs associated with the proposed revised designation. The total future baseline impacts (potential costs related to the subspecies being listed and other conservation-related activities) are estimated to be $510 million to $1.34 billion ($46.1 million to $121 million on an annualized basis), assuming a 7 percent discount rate, through the year 2030.
        The majority of incremental impacts attributed to the proposed revised critical habitat designation are expected to be related to development (approximately 90 percent) followed by agricultural impacts (approximately 10 percent). Impacts to all other activities represent less than one percent of the total incremental impacts. The DEA estimates total potential incremental economic impacts in areas proposed as revised critical habitat over the next 22 years (2009 to 2030) to be $183 million to $566 million ($16.5 to $51.2 million annualized) in present value terms using a 7 percent discount rate. For development, the estimated incremental impacts range from $124 million to $507 million, assuming a 7 percent discount rate; for agriculture, the estimated incremental impacts range from $58.3 million to $80.9 million, assuming a 7 percent discount rate.
        The revised DEA considers both economic efficiency and distributional effects. In the case of habitat conservation, efficiency effects generally reflect the “opportunity costs” associated with the commitment of resources to comply with habitat protection measures (e.g., lost economic opportunities associated with restrictions on land use). The revised DEA also addresses how potential economic impacts are likely to be distributed, including an assessment of any local or regional impacts of habitat conservation and the potential effects of conservation activities on government agencies, private businesses, and individuals. The revised DEA measures lost economic efficiency associated with residential and commercial development and public projects and activities, such as economic impacts on water management and transportation projects, Federal lands, small entities, and the energy industry. Decision-makers can use this information to assess whether the effects of the revised designation might unduly burden a particular group or economic sector.
        As we stated earlier, we are soliciting data and comments from the public on the revised DEA, as well as on all aspects of the proposed revised critical habitat rule. The final revised critical habitat rule may differ from the proposed revised rule based on new information we receive during the public comment periods. In particular, we may exclude an area from critical habitat if we determine that the benefits of excluding the area outweigh the benefits of including the area as critical habitat, provided the exclusion will not result in the extinction of the subspecies.
        Required Determinations—Amended
        In our proposed rule dated September 16, 2008 (73 FR 53492), we indicated that we would defer our determination of compliance with several statutes and Executive Orders until the information concerning potential economic impacts of the revised designation and potential effects on landowners and stakeholders became available in the DEA. We have now made use of the revised DEA to make these determinations. In this document, we affirm the information in our proposed rule concerning Executive Order (E.O.) 13132, E.O. 12988, the Paperwork Reduction Act, the National Environmental Policy Act, and the President's memorandum of April 29, 1994, “Government-to-Government Relations with Native American Tribal Governments” (59 FR 22951). However, based on the DEA data, we revised our required determinations concerning E.O. 12866 and the Regulatory Flexibility Act, E.O. 13211 (Energy, Supply, Distribution, and Use), the Unfunded Mandates Reform Act, and E.O. 12630 (Takings).
        Regulatory Planning and Review (E.O. 12866)
        The Office of Management and Budget (OMB) has determined that this proposed revised designation is not significant and has not reviewed this proposed rule under Executive Order 12866 (E.O. 12866). OMB bases its determination upon the following four criteria:
        (a) Whether the rule will have an annual effect of $100 million or more on the economy or adversely affect an economic sector, productivity, jobs, the environment, or other units of the government.
        (b) Whether the rule will create inconsistencies with other Federal agencies' actions.
        (c) Whether the rule will materially affect entitlements, grants, user fees, loan programs, or the rights and obligations of their recipients.
        (d) Whether the rule raises novel legal or policy issues.
        Regulatory Flexibility Act (5 U.S.C. 601 et seq.)
        Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), as amended by the Small Business Regulatory Enforcement Fairness Act (5 U.S.C. 802(2)), whenever an agency is required to publish a notice of rulemaking for any proposed or final rule, it must prepare and make available for public comment a regulatory flexibility analysis that describes the effect of the rule on small entities (i.e., small businesses, small organizations, and small government jurisdictions). However, no regulatory flexibility analysis is required if the head of an agency certifies the rule will not have a significant economic impact on a substantial number of small entities. Based on our revised DEA of the proposed revised designation, we provide our analysis for determining whether the proposed revised rule would result in a significant economic impact on a substantial number of small entities. Based on comments we receive, we may revise this determination as part of a final rulemaking.
        According to the Small Business Administration, small entities include small organizations, such as independent nonprofit organizations; small governmental jurisdictions, including school boards and city and town governments that serve fewer than 50,000 residents; and small businesses (13 CFR 121.201). Small businesses include manufacturing and mining concerns with fewer than 500 employees, wholesale trade entities with fewer than 100 employees, retail and service businesses with less than $5 million in annual sales, general and heavy construction businesses with less than $27.5 million in annual business, special trade contractors doing less than $11.5 million in annual business, and agricultural businesses with annual sales less than $750,000. To determine if potential economic impacts to these small entities are significant, we considered the types of activities that might trigger regulatory impacts under this designation as well as types of project modifications that may result. In general, the term significant economic impact is meant to apply to a typical small business firm's business operations.
        To determine if the proposed revised designation of critical habitat for the California red-legged frog would affect a substantial number of small entities, we consider the number of small entities affected within particular types of economic activities, such as residential and commercial development. In order to determine whether it is appropriate for our agency to certify that this rule would not have a significant economic impact on a substantial number of small entities, we considered each industry or category individually. In estimating the numbers of small entities potentially affected, we also considered whether their activities have any Federal involvement. Critical habitat designation will not affect activities that do not have any Federal involvement.
        Designation of critical habitat only affects activities conducted, funded, permitted, or authorized by Federal agencies. Some kinds of activities are unlikely to have any Federal involvement and so will not be affected by critical habitat designation. In areas where the subspecies is present, Federal agencies already are required to consult with us under section 7 of the Act on activities they fund, permit, or implement that may affect the California red-legged frog. Federal agencies also must consult with us if their activities may affect revised designated critical habitat.
        In the revised DEA of the proposed revision to critical habitat, we evaluate the potential economic effects on small business entities resulting from implementation of conservation actions related to the proposed revision to critical habitat for the California red-legged frog. The revised DEA identifies the estimated incremental impacts associated with the proposed rulemaking as described in Chapters 4 through 13 of the revised DEA, and evaluates the potential for economic impacts related to activity categories including urban development, water management, agriculture, grazing and ranching, timber harvest activities, transportation, utility pipeline construction and maintenance, fire management activities, and habitat management. The revised DEA concludes that the incremental impacts resulting from this rulemaking that may be borne by small businesses will be associated with urban development and agriculture. Incremental impacts are either not expected for the other types of activities considered or, if expected, will not be borne by small entities.
        As discussed in Appendix A of the revised DEA, the largest impacts of the proposed rule result from section 7 consultations with the Service on development projects not subject to an existing habitat conservation plan, and to a lesser degree, similar types of costs resulting from the California Environmental Quality Act (CEQA) review of development projects lacking a Federal nexus. The analysis assumes full build-out of all areas identified as likely to be developed (as defined in Chapter 4 of the DEA; IEC 2009b) within the next 22 years. The DEA (Exhibit 4-5) identifies approximately 2,226 ac (860 ha) of projected development in areas likely to experience impacts as a result of the designation of critical habitat (incremental impact).
        This analysis assumes incremental development-related costs will be borne either by developers or current landowners, depending on the developers' ability to offset critical habitat costs by paying lower prices for developable acres at the outset of projects. Current landowners may be individuals or families that are not legally considered to be businesses. As shown in Exhibit A-2, nearly all developers in the counties overlapping proposed critical habitat are, by definition, small entities. To understand the potential impact development-related costs on small entities, the IRFA assigns all costs to small development firms. This assumption is likely to overstate the actual impacts to such entities.
        Assuming a 100-acre (40-hectare) average development size yields approximately 22 affected development projects over the next 22 years, or approximately 1 project annually. The incremental impact due to critical habitat is estimated to range from $11.2 to $45.9 million on an annualized basis, assuming a 7 percent discount rate.
        The incremental costs attributed to agriculture are explained in Chapter 6 of the DEA. As described in Chapter 6, a stipulated injunction issued by the U.S. District Court for the Northern District of California restricts pesticide application in designated critical habitat. This analysis assumes these restrictions will continue through 2030 as a result of future section 7 consultation between the Service and U.S. Environmental Protection Agency. The analysis assumes that the lands affected by this prohibition will be taken out of production; to the extent that there are alternative beneficial uses of agricultural land (such as organic farming or grazing), or the section 7 consultation process results in less prohibitive use of pesticides, this analysis may overstate future economic impacts.

        To estimate the potential incremental impact on small farmers, we began by estimating the probability that affected areas are likely to be found on small farms based on the percentage of total cropland in each county cultivated by small entities. We divided the resulting areas by the median farm size per county to estimate that a minimum of 217 small farms are likely to be affected. If less than 100 percent of these farms overlaps affected areas, then the number of farms affected could be higher. Total annualized impacts associated with these areas are anticipated to be as high as $2.7 million (see Exhibit A-6), assuming a 7 percent discount rate, or $500 to $168,000 per farm, depending on the type of crops affected. Note that, if the number of small farms affected is greater than 217, the per farm impacts will be lower.

        In summary, we have considered whether the revised proposed rule would result in a significant economic impact on a substantial number of small entities. As a result of the uncertainty that exists regarding both the numbers of entities that may be impacted by the revised proposed rule and the degree of impact on individual entities, we have developed an Initial Regulatory Flexibility Analysis (IRFA) (DEA 2009b, Appendix A). However, due to the number of uncertainties identified in the DEA, we have prepared this IRFA without first making the threshold determination of whether the revised proposed critical habitat designation could be certified as not having a significant economic impact on a substantial number of small entities. This IRFA is intended to improve the Service's understanding of the effects of the proposed rule on small entities and to identify opportunities to minimize these impacts in the final rulemaking.
        Executive Order 13211—Energy Supply, Distribution, and Use
        E.O. 13211 requires agencies to prepare Statements of Energy Effects when undertaking certain actions that may affect the supply, distribution, and use of energy. This proposed revision to critical habitat for the California red-legged frog is not considered a significant regulatory action under E.O. 12866. OMB's guidance for implementing this Executive Order outlines nine outcomes that may constitute “a significant adverse effect” when compared to no regulatory action. As highlighted in Chapter 10 (Exhibits 10-2 and 10-3), a number of oil and gas companies own and operate pipelines that pass through the proposed revised critical habitat, and Waste Management and the Linde Group plan to build the world's largest landfill gas plant in Unit ALA-2. However, the incremental impact to these entities over the next 22 years is solely attributable to the costs of section 7 consultation and no measurable impacts to the quantity or cost of energy production and distribution are likely to result from the revised designation of critical habitat (such as a reduction in electricity production or an increase in the cost of energy production or distribution), and a Statement of Energy Effects is not required.
        Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq.)
        In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501), the Service makes the following findings:
        (a) This rule will not produce a Federal mandate. In general, a Federal mandate is a provision in legislation, statute, or regulation that would impose an enforceable duty upon State, local, or tribal governments, or the private sector, and includes both “Federal intergovernmental mandates” and “Federal private sector mandates.” These terms are defined in 2 U.S.C. 658(5)-(7). “Federal intergovernmental mandate” includes a regulation that “would impose an enforceable duty upon State, local, or tribal governments,” with two exceptions. It excludes “a condition of federal assistance.” It also excludes “a duty arising from participation in a voluntary Federal program,” unless the regulation “relates to a then-existing Federal program under which $500,000,000 or more is provided annually to State, local, and tribal governments under entitlement authority,” if the provision would “increase the stringency of conditions of assistance” or “place caps upon, or otherwise decrease, the Federal government's responsibility to provide funding” and the State, local, or tribal governments “lack authority” to adjust accordingly. “Federal private sector mandate” includes a regulation that “would impose an enforceable duty upon the private sector, except (i) a condition of Federal assistance; or (ii) a duty arising from participation in a voluntary Federal program.”
        Critical habitat designation does not impose a legally binding duty on non-Federal Government entities or private parties. Under the Act, the only regulatory effect is that Federal agencies must ensure that their actions do not destroy or adversely modify critical habitat under section 7. Designation of critical habitat may indirectly impact non-Federal entities that receive Federal funding, assistance, or permits, or that otherwise require approval or authorization from a Federal agency for an action that may destroy or adversely modify critical habitat. However, the legally binding duty to avoid destruction or adverse modification of critical habitat rests squarely on the Federal agency. Furthermore, to the extent that non-Federal entities are indirectly impacted because they receive Federal assistance or participate in a voluntary Federal aid program, the Unfunded Mandates Reform Act would not apply, nor would critical habitat shift the costs of the large entitlement programs listed above to State governments.
        (b) We do not believe that this rule would significantly or uniquely affect small governments because it would not produce a Federal mandate of $100 million or greater in any year; that is, it is not a “significant regulatory action” under the Unfunded Mandates Reform Act. The revised DEA concludes incremental impacts may occur due to project modifications that may need to be made for development and tribal activities; however, these are not expected to affect small governments as the costs attributed to development is limited to private lands and not those owned by local governments. Consequently, we do not believe that the revised critical habitat designation would significantly or uniquely affect small government entities. As such, a Small Government Agency Plan is not required.
        Executive Order 12630-Takings
        In accordance with E.O. 12630 (“Government Actions and Interference with Constitutionally Protected Private Property Rights”), we have analyzed the potential takings implications of proposing revised critical habitat for the California red-legged frog in a takings implications assessment. Our takings implications assessment concludes that the proposed revision to critical habitat for the California red-legged frog does not pose significant takings implications.
        References Cited

        A complete list of all references we cited in the proposed rule and in this document is available on the Internet at http://www.regulations.gov or by contacting the Sacramento Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT section).
        Authors
        The primary authors of this rulemaking are the staff members of the Sacramento Fish and Wildlife Office.

          Dated: September 29, 2009.
           Thomas L. Strickland,
          Assistant Secretary for Fish and Wildlife and Parks.

      [FR Doc. E9-24327 Filed 10-7-09; 8:45 am]
      BILLING CODE 4310-55-P


        DEPARTMENT OF COMMERCE
        Bureau of Industry and Security
        15 CFR Parts 740, 742, 744, 748, 754, 764 and 772
        [Docket No. 0612242559-7061-01]
        RIN 0694-AD94
        Mandatory Electronic Filing of Export and Reexport License Applications, Classification Requests, Encryption Review Requests, and License Exception AGR Notifications

          AGENCY:
          Bureau of Industry and Security, Commerce.

          ACTION:
          Proposed rule.

          SUMMARY:
          This proposed rule would require that export and reexport license applications, classification requests, encryption review requests, License Exception AGR notifications and related documents be submitted to the Bureau of Industry and Security (BIS) via its Simplified Network Application Process (SNAP-R) system. This requirement would not apply to applications for Special Comprehensive Licenses or in certain situations in which BIS would authorize paper submissions.

          DATES:
          Comments must be received by December 18, 2007.

          ADDRESSES:
          Comments on this proposed rule may be submitted via http://www.regulations.gov. Scroll down to the heading “Search Documents.” At Step 1, select “Documents Accepting Comments” then, at Optional Step 2, select from the pull down menu “Bureau of Industry and Security” and click on the “Submit” button. On the resulting screen, select docket number BIS-2007-0002. Click on the yellow comment icon. You may either type your comments directly on the on-line comment form or “attach” a file containing your comments. Regulations.gov accepts most popular document file formats. Comments may also be e-mailed to BIS at publiccomments@bis.doc.gov (please refer to regulatory identification number (RIN) 0694-AD94 in the subject line) or submitted on paper to Regulatory Policy Division, Office of Exporter Services, Bureau of Industry and Security, Room H2705, U.S. Department of Commerce, 14th Street and Pennsylvania Avenue, NW., Washington, DC 20230. Please refer to RIN 0694-AD94 in all paper comments.

          FOR FURTHER INFORMATION CONTACT:
          William Arvin e-mail warvin@bis.doc.gov or tel. 202 482 2440.

        SUPPLEMENTARY INFORMATION:

        Background
        BIS administers a system of export and reexport controls in accordance with the Export Administration Regulations (EAR). In doing so, BIS requires that parties wishing to engage in certain transactions apply for licenses, submit encryption review requests, or submit certain notifications to BIS. BIS also reviews, upon request, specifications of various items and determines their proper classification under the EAR. Currently members of the public submit these applications, requests and notifications to BIS in one of three ways: via SNAP-R, via BIS's Electronic License Application Information Network (ELAIN), or via the paper BIS Multipurpose Application Form BIS 748-P and its two appendices, the BIS 748-P A (item appendix) and the BIS 748-P B (end user appendix). In many instances, BIS needs additional documents to act on the submission. For documents that relate to paper submissions, the documents can be mailed or delivered to BIS with the BIS 748-P form. For submissions made electronically via ELAIN, the documents must be sent to BIS separately and matched up with the application when they arrive.
        In 2006, BIS made a number of improvements its then existing Simplified Network Application Processing system (SNAP), and designated this improved version as “SNAP-R”. The improvements include the ability to include documents related to a submission in the form of PDF (portable document format) files as “attachments” to the submission. Other improvements include a feature that allows BIS personnel to request additional information from the submitting party and for the party to submit that information in a manner that ties the chain of communication to the submission.
        BIS believes that use of SNAP-R will reduce processing times and simplify compliance with and administration of export controls. SNAP-R provides not only improved efficiency in submission and processing, but improved end-user security through rights management and an updated application and security infrastructure.
        Therefore, BIS proposes to require that all export and reexport license applications (other than Special Comprehensive License applications), classification requests, encryption review requests, License Exception AGR notifications, and “attached” related documents be submitted to BIS via its Simplified Network Application Process (SNAP-R) system unless BIS authorizes paper submissions. This proposed rule would also set the criteria by which BIS would authorize paper submissions and would terminate use of ELAIN. This proposed rule would make no changes to the procedures by which the public requests advisory opinions because such requests are not processed via either the paper form 748-P or either of BIS's existing electronic systems.
        Changes Proposed To Be Made by This Rule

        The changes that this proposed rule would make center on part 748 of the EAR, which sets forth the principal procedures governing the submission of the applications, review requests and notifications that would be affected by this proposed rule. The changes would appear in § 748.1—“General provisions,” § 748.3—“Classification requests, advisory opinions, and encryption review requests,” and in § 748.6—“General instructions for license applications.” The rule would also make conforming changes to a number of EAR provisions that currently employ language related to the paper forms.
        Substantive Changes
        Section 748.1 would be revised to emphasize electronic filing over paper and to set forth the basic requirement that license applications (other than Special Comprehensive License applications), encryption review requests, License Exception AGR notifications, and classification requests and any accompanying documents must be submitted via SNAP-R unless BIS authorizes submission via paper. Revised section 748.1 would continue to specify that for paper submissions, only original BIS paper forms may be used and that reproductions or facsimiles are not acceptable.

        Section 748.1 would also set forth the criteria under which BIS would authorize paper submissions. Those criteria are: (1) BIS has received no more than one submission from the party in the twelve months immediately preceding the current submission, i.e., the combined total of the party's license applications (other than Special Comprehensive Licenses), encryption review requests, License Exception AGR notifications, and classification requests could not exceed one; (2) the party does not have access to the Internet; (3) BIS has rejected the party's electronic filing registration or revoked its eligibility to file electronically; (4) BIS has requested that the party submit on paper for a particular transaction; or (5) BIS has determined that urgency, a need to implement government policy or a circumstance outside the submitting party's control justify allowing paper submissions on a particular instance.
        Parties who wished to submit on paper would submit the BIS Form 748-P. In addition to the information relevant to the substance of the submission itself, the submitter would be required to include, either on the form or as an attachment, a statement explaining which of the five foregoing criteria justify a paper submission and supporting information. If BIS agreed that at least one of the criteria were met, it would process the submission in accordance with its regular procedures. If BIS found that none of the criteria provided by the submitter was met, it would return the form without action and inform the submitter of the reason for rejecting the request to file on paper. A decision by BIS to reject the request to file on paper is subject to appeal under part 756 of the EAR. This proposed rule also would move the address for paper submissions from § 748.2 to § 748.1.
        Section 748.3 would be revised to replace instructions about where and how to submit classification requests, with a reference to the procedures in § 748.1. Section 748.3 would continue to state requirements about the kinds of information that must be included in classification requests.
        Section 748.6 would be revised to require that any documents submitted in support of any license application submitted via SNAP-R be submitted via the SNAP-R system as PDF (portable document format) files. Section 748.6 also would be revised to remove the statement that application control numbers are preprinted on the paper forms. The paper forms will continue to bear a preprinted application control number, but for electronic submissions, application control numbers are communicated to the submitter electronically once BIS accepts the submission.
        Conforming Changes
        A number of EAR provisions currently state that a particular submission must be made on the BIS 748-P paper form or state that it must be either on the 748-P or its electronic equivalent. If such a provision refers to a classification request or encryption review request, this proposed rule would revise that provision to state that the submission must be made in accordance with §§ 748.1 and 748.3. If such a provision refers to a license application (other than a Special Comprehensive License application), this proposed rule also would revise that provision to state that the submission must be in accordance with §§ 748.1, 748.4 and 748.6. The changes described in this paragraph would be made in:
        • § 740.8(b)(2), relating to classification requests pursuant to License Exception “Key Management Infrastructure (KMI)”;
        • § 740.9(a)(4)(i) and (iii), relating to authorizations to sell or dispose of or to retain abroad more than one year items exported under License Exception “Temporary imports, exports and reexports (TMP)”;
        • § 740.12(a)(2)(iii)(C), relating to applications to exceed the frequency limits for individual gift parcels under license exception “Gift parcels and humanitarian donations (GFT)”;
        • § 740.17(d)(1), relating to the submission of encryption review requests under License Exception “Encryption commodities and software” (ENC);
        • § 742.15(b)(2)(i), relating to submission of review requests for certain encryption items; Supplement No. 6 to part 742, relating to submission of review requests for certain “mass market” encryption commodities and software;
        • § 754.2(g)(1), relating applications for export of certain California crude oil;
        • § 754.4(d)(1), relating to applications to export unprocessed Western Red Cedar; and
        • § 764.7(b)(2)(i), relating to applications to take certain actions with respect to certain items in Libya.
        This proposed rule would replace the requirement to use the form BIS 748-P in § 740.18(c)(2) when submitting notice to the government in advance of shipments under License Exception “Agricultural Commodities (AGR)” with a requirement to submit such notices in accordance with § 748.1 of the EAR.
        This proposed rule also would replace references to the BIS 748-P Multipurpose Application Form with the word “application” in provisions that describe certain information that must be submitted with particular types of license applications. This change emphasizes that the same information is required regardless of whether an application is submitted on paper or electronically. The change described in this paragraph would be made in:
        • § 744.21(d), relating to applications to export or reexport certain items to known military end-uses in the People's Republic of China;
        • § 748.4(b)(2)(ii), relating to written authority of certain agents to submit on a principal's behalf;
        • § 754.4(d)(2) and (d)(3), relating to applications for export of unprocessed western red cedar;
        • § 754.5(b)(2), relating to applications to export horses by sea; and
        • § 772.1, definition of “Other party authorized to receive license.”
        This proposed rule also would remove the reference to date time stamping in § 754.2(g)(5)(i) by BIS of applications to export crude oil because that process occurs only with paper applications. However, the proposed rule would retain the policy in § 754.2(g)(5)(i) of issuing licenses for approved applications in the order in which the applications are received.

        This proposed rule would also change the reference currently found in § 748.3 to the section containing the address for submitting advisory opinion requests from 748.2 to 748.1.

        Public Comments

        BIS will consider all comments received on or before December 18, 2007. BIS will consider comments received after that date if possible but cannot assure such consideration. All public comments on this proposed rule must be in writing (writing includes electronic submission of comments via www.regulations.gov or e-mail directly to BIS) and will be a matter of public record, available for public inspection and copying on the www.regulations.gov Web site under docket number BIS-2007-0002.
        Rulemaking Requirements
        1. This rule has been determined to be significant for purposes of Executive Order 12866.

        2. Notwithstanding any other provision of law, no person is required to respond to nor be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number. This regulation involves collections previously approved by the OMB under control number 0694-0088, “Multi-Purpose Application,” which carries a burden hour estimate of 58 minutes to prepare and submit form BIS-748. Miscellaneous and recordkeeping activities account for 12 minutes per submission. This proposed rule would require persons seeking authorization to submit paper filings to state, either in the additional information block on the paper form or an attachment, which of the criteria for paper submissions they meet and the reasons therefore. BIS believes that requests seeking authorization to submit paper filings would impose a minimal burden on applicants as the information requirements are small and the number of requests is expected to be low. Applicants making a request would identify one or more of the 5 criteria under which BIS would authorize a paper submission, and provide the factual basis for the authorization to submit on paper. BIS estimates that only a small number of submissions will seek authorization to file on paper. Based on current information on submissions, more than 85% of all submissions affected by this rule are currently transmitted to BIS via SNAP-R. Therefore, BIS estimates that this requirement will make no material change of the estimated time of 58 minutes needed to prepare and submit a BIS-748. Send comments regarding these burden estimates or any other aspect of these collections of information, including suggestions for reducing the burden, to David Rostker, OMB Desk Officer, by e-mail at david_rostker@omb.eop.gov or by fax to (202) 395-7285; and to the Regulatory Policy Division, Bureau of Industry and Security, Department of Commerce, P.O. Box 273, Washington, DC 20044.
        3. This rule does not contain policies with Federalism implications as that term is defined in Executive Order 13132.
        4. The Chief Counsel for Regulation of the Department of Commerce has certified to the Counsel for Advocacy of the Small Business Administration that this proposed rule would not have a significant economic impact on a substantial number of small entities.
        Number of Small Entities Affected
        BIS does not collect data on the size of entities that file these submissions. However, based on the information that it does possess, BIS believes that fewer than 1340 small entities are likely to be affected by this rule. BIS arrived at this conclusion by identifying all of the entities that filed two or more submissions during the period from January 1, 2006 through December 31, 2006. A total of 1592 such entities were identified. BIS determined that 252 of these are not small entities because they could be identified through open public sources as having more than $100 million in annual sales or more than 5,000 employees or because they are United States Government agencies.
        Because many industries may be involved in exporting, BIS could not directly relate its data to the “Small Business Size Standards Matched to North American Industry Classification System” (the Standards Table) published by the Small Business Administration (SBA). However, BIS notes that the Standards Table designates business as small based on either sales or number of employees, depending on the industry. The maximum annual sales and maximum number of employees listed in that document are $31 million and 1,500, respectively. Both numbers are far below the threshold selected by BIS in arriving at the number of 1340 as the maximum number of small entities likely to be affected by this rule. Quite likely many of the 1340 remaining entities would be larger than the largest business listed in the Standards Table.
        In addition, most of the categories in the Standards Table for which the sales limit is more than $6.5 million are unlikely to be impacted by this rule because they are unlikely to engage in export or reexport transactions that require specific authorization from BIS. Examples of small entities at the higher end of the range of the Standards Table include, Forest Fire Suppression—$16.5 million, New Single-Family Housing Construction Contractors—$31.0 million and Gasoline Stations with Convenience Stores—$25.0 million.
        Burden Incurred
        Some entities might incur no additional burden because of this rule. These are the entities whose submissions require no accompanying documents, those who are already creating the documents in PDF and those who are already creating the documents using software that is capable of producing the same documents in PDF. BIS does not have data on the number of entities that would incur no burden, but based on a sample of submissions of the type to which this proposed rule would apply for the period October 15, 2006 through March 9, 2007, BIS estimates that about 48 percent of the submissions would not require any accompanying documents.
        Some entities might incur only a software acquisition burden because of this rule. These are the entities whose accompanying documents are already created using software that cannot produce PDF files directly, but that can produce such files with additional software that the entity can purchase. BIS estimates that such an entity with a small operation would incur an initial expense of approximately $325 to acquire that software necessary to comply with this rule. This estimate is based on the price of Adobe Acrobat® Standard Edition ($299) as posted on the Adobe Corporation Web site on December 27, 2006, plus any taxes or shipping charges.
        Some entities might need to scan paper documents and convert them to PDF files. Such entities would have three alternatives: Pay someone else to scan and convert the documents; acquire a scanner with built-in PDF capability; or acquire hardware and software to scan in and convert the documents.
        An entity with a small number of documents to scan probably would find it most economical to pay someone else to scan the paper documents and convert them to PDF files. After reviewing some prices charged in the Washington area, BIS estimates that the costs would range from about $19 to about $31 to convert eight pages of paper documents to PDF format.

        In some instances, the entity could utilize software that comes bundled with a scanner to comply with this requirement. In such instances, BIS estimates that the entity would incur an initial cost of approximately $500 (to purchase the scanner) to comply with this rule.
        In some cases, particularly if the entity has to scan numerous complex paper documents, the costs could be higher. BIS estimates that the initial costs for an entity facing such a situation would be approximately $900. This estimate is based on a price of $300 for Adobe Acrobat® Standard Edition software, $500 for a scanner, and $100 for taxes and shipping charges.
        Entities that have to scan paper documents may incur labor costs to scan and convert the documents to PDF. BIS estimates that scanning and converting a document page would take from 2 minutes to 10 minutes per page depending on the scanner and computer performance. BIS recently sampled the submissions that had accompanying documents for the months of February and March 2006. A total of 703 submissions had accompanying documents. Some submissions had only one accompanying page. The average number of accompanying pages for these 703 submissions was 8.5 and the largest number of accompanying pages for any one submission was 284. However, BIS has no way of determining which attachments could be generated electronically and which would require scanning. Assuming an average of 8.5 pages per document and labor costs for documents at $15 per hour, this cost could range from about $0.50 for one accompanying page that took two minutes to scan to $720 for a 284-page document that took 10 minutes per page to scan. Assuming an average scanning time of 5 minutes per page and an 8.5 as the average number of pages scanned, the average estimated labor cost for scanning would be $10.63.
        Cost Reductions To Offset the Burdens
        A party not using the electronic “attachment” feature of SNAP-R would have to submit any required documents by paper. In many instances, such a party would incur labor costs to copy the documents that are comparable to those incurred when scanning a document to produce a PDF file. For such parties, any increased scanning costs incurred by using SNAP-R would be offset by decreased copying costs.
        Electronic filing can reduce costs in other ways as well. Currently, in many instances, attachments are submitted to BIS by overnight courier. Electronic filing would eliminate these courier costs. Collectively, the 1592 entities that made two or more submissions in 2006 provided 22,223 submissions. The largest number from any one submitter was 911, the smallest number from any one submitter was 2, and the average number per submitter was 14. Assuming an average cost of $20.00 to submit documents by courier, and further assuming that about 52 percent of the submissions required accompanying documents, the aggregate savings provided by electronic submission of accompanying documents would be $231,119 for the largest submitter, $146 for a submitter of the average number of submissions and $20 for a submitter of 2 submissions. In addition SNAP-R will provide the submitter with automatic confirmation of receipt of the documents by BIS. In many instances, couriers charge extra for delivery confirmation.
        Further savings would be achieved if a particular set of documents applied to more than one submission. A party using SNAP-R would need to submit the documents only once and could reference them in subsequent submissions to which they apply whereas a party submitting via paper would have to submit new paper copies each time. Applicants for successive export licenses to ship the same items repeatedly could experience substantial savings from this feature of SNAP-R.
        The SNAP-R system groups all communications between exporter and BIS for each electronic application, including supporting documents so that they can be viewed from within the SNAP-R application by all authorized personnel of the submitter. This feature allows for easier reassignment of work when necessary due, for example, to employee absences, resignations, or retirements, than a system in which users have to manage their own documentation and transcribe their communications with the licensing officers and correlate those communications with paper submissions of supporting documents.
        Electronic filing can reduce costs to the submitters and to the government by reducing paper handling and delays incurred when moving paper through the system. Currently, BIS uses an electronic system to process all submissions that are subject to this proposed rule, whether it receives the submission on paper or electronically. However, if the attachments are on paper, delays ensue as paper documents are moved to the technical personnel in BIS and in other government agencies whereas electronic attachments can be transmitted to the appropriate personnel almost instantly. Electronic attachments are likely to reduce the total time from submission to final decision by several days. Although the benefit of faster processing times is difficult to quantify, the information that BIS possesses indicates that, in the aggregate, the potential benefit is quite large. In calendar year 2006, BIS processed 18,941 license applications with an aggregate value of $36 billion. Assuming a six percent annual rate of return for alternative investments, the opportunity cost of holding $36 billion worth of merchandise in inventory while waiting for a government decision on whether the transaction may proceed would be $2.16 billion annually or $5.9 million per day. Dividing $5.9 million by the number of applications, 18,941, provides an inferred average opportunity cost of $311 for each day that processing of an application is delayed.
        Conclusion
        BIS is unable to determine whether or not the number of small entities likely to be affected by this is rule is substantial. However, for any small entities that are affected, the savings from re-use of documents for multiple submissions, reduced courier fees and faster processing times are likely to fully or partially compensate for the cost of compliance with this rule. Thus the economic impact of this rule on such entities is not significant.

          List of Subjects
          15 CFR Parts 740 and 748
          Administrative practice and procedure, Exports, Reporting and recordkeeping requirements.
          15 CFR Part 742
          Exports, Terrorism.
          15 CFR Part 744
          Exports, Reporting and recordkeeping requirements, Terrorism
          15 CFR Part 754
          Agricultural commodities, Exports, Forests and forest products, Horses, Petroleum, Reporting and recordkeeping requirements.
          15 CFR Part 764
          Administrative practice and procedure, Exports, Law enforcement, Penalties.
          15 CFR Part 772
          Exports.

        Accordingly, parts 740, 742, 748, 754, 764 and 772 of the Export Administration Regulations (15 CFR 730-774) are proposed to be amended as follows:

          PART 740—[AMENDED]
          1. The authority citation for 15 CFR part 740 continues to read as follows:

            Authority:
            50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; Sec. 901-911, Pub. L. 106-387; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007).

          2. In § 740.8 revise paragraph (b)(2) to read as follows:

            § 740.8
            Key management infrastructure (KMI).

            (b) Eligible commodities and software. * * *
            (2) For such classification requests, indicate “License Exception KMI” in Block 9 on the application. Submit the request to BIS in accordance with §§ 748.1 and 748.3 of the EAR and send a copy of the request to: Attn: ENC Encryption Request Coordinator, 9800 Savage Road, Suite 6940, Fort Meade, MD 20755-6000

            3. In § 740.9 revise the first sentences of paragraphs (a)(4)(i) and (a)(4)(iii) to read as follows:

            § 740.9
            Temporary imports, exports and reexports (TMP).

            (a) * * *
            (4) * * *
            (i) Permanent export or reexport. If the exporter or the reexporter wishes to sell or otherwise dispose of the commodities or software abroad, except as permitted by this or other applicable License Exception, the exporter or reexporter must request authorization by submitting a license application to BIS in accordance with §§ 748.1, 748.4 and 748.6 of the EAR. * * *

            (iii) Authorization to retain abroad beyond one year. If the exporter wishes to retain a commodity or software abroad beyond the 12 months authorized by paragraph (a) of this section, the exporter must request authorization by submitting a license application in accordance with §§ 748.1, 748.4 and 748.6 of the EAR to BIS 90 days prior to the expiration of the 12 month period. * * *

            4. In § 740.12, revise paragraph (a)(2)(iii)(C) to read as follows:

            § 740.12
            Gift parcels and humanitarian donations (GFT).
            (a) * * *
            (2) * * *
            (iii)* * *
            (C) Parties seeking authorization to exceed these frequency limits due to compelling humanitarian concerns (e.g., for certain gifts of medicine) should submit a license application in accordance with §§ 748.1, 748.4 and 748.6 of the EAR to BIS with complete justification.

            5. In § 740.17 revise the paragraph (d)(1) to read as follows:

            § 740.17
            Encryption commodities and software (ENC).

            (d) * * *
            (1) Instructions for requesting review. Review requests submitted to BIS must be submitted as described in §§ 748.1 and 748.3 of the EAR. See paragraph (e)(5)(ii) of this section for the mailing address for the ENC Encryption Request Coordinator. To ensure that your review request is properly routed, insert the phrase “License Exception ENC” in Block 9 (Special Purpose) of the application. Also, place an “X” in the box marked “Classification Request” in Block 5 (Type of Application) of Form BIS-748P or select “Commodity Classification” if filing electronically. Neither the electronic nor paper forms provide a separate block to check for the submission of encryption review requests. Failure to properly complete these items may delay consideration of your review request.

            6. In § 740.18 revise paragraph (c)(2) to read as follows:

            § 740.18
            Agricultural commodities (AGR).

            (c) Prior notification. * * *
            (2) Procedures. You must provide prior notification of exports and reexports under License Exception AGR by submitting a completed application in accordance with § 748.1 of the EAR. The following blocks must be completed, as appropriate: Blocks 1, 2, 3, 4, 5 (by marking box 5 “Other”), 14, 16, 17, 18, 19, 21, 22 (a), (e), (f), (g), (h), (i), (j), 23, and 25 according to the instructions described in Supplement No. 1 to part 748 of the EAR. If your commodity is fertilizer, western red cedar or live horses, you must confirm that BIS has previously classified your commodity as EAR99 by placing the Commodity Classification Automatic Tracking System (CCATS) number in Block 22(d). BIS will not initiate the registration of an AGR notification unless the application is complete.

          PART 742—[AMENDED]
          7. The authority citation for 15 CFR part 742 continues to read as follows:

            Authority:
            50 U.S.C. App. 2401 et seq.; 50 U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; Sec. 901-911, Pub. L. 106-387; Sec. 221, Pub. L. 107-56; Sec. 1503, Pub. L. 108-11, 117 Stat. 559; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Presidential Determination 2003-23 of May 7, 2003, 68 FR 26459, May 16, 2003; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of October 27, 2006, 71 FR 64109 (October 31, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007).

          8. In § 742.5, revise paragraph (b)(2)(i) to read as follows:

            § 742.15
            Encryption items.

            (b) Notification and review requirements for encryption items controlled under ECCN 5A992, 5D992 or 5E992. * * *

              (2) Review requirement for mass market encryption commodities and software exceeding 64 bits: * * *
            (i) Procedures for requesting review. To request review of your mass market encryption products, you must submit to BIS and the ENC Encryption Request Coordinator the information described in paragraphs (a) through (e) of Supplement No. 6 to this part 742, and you must include specific information describing how your products qualify for mass market treatment under the criteria in the Cryptography Note (Note 3) of Category 5, Part 2 (“Information Security”), of the Commerce Control List (Supplement No. 1 to part 774 of the EAR). Submit review requests to BIS in accordance with §§ 748.1 and 748.3 of the EAR. To ensure that your review request is properly routed, insert the phrase “Mass market encryption” in Block 9 (Special Purpose) and place an “X” in the box marked “Classification Request” in Block 5 (Type of Application)—Block 5 does not provide a separate item to check for the submission of encryption review requests. Failure to properly complete these items may delay consideration of your review request. Submissions to the ENC Encryption Request Coordinator should be directed to the mailing address indicated in § 740.17(e)(5)(ii) of the EAR. BIS will notify you if there are any questions concerning your request for review (e.g., because of missing or incomplete support documentation).

            9. In Supplement No. 6 to Part 742 revise the first sentence to read as follows:
            Supplement No. 6 to Part 742—Guidelines for Submitting Review Requests for Encryption Items

              Review requests for encryption items must include all of the documentation described in this supplement and submitted to BIS in accordance with §§ 748.1 and 748.3 of the EAR. * * *

          PART 744—[AMENDED]
          10. The authority citation for part 744 continues to read as follows:

            Authority:
            50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 22 U.S.C. 3201 et seq.; 42 U.S.C. 2139a; Sec. 901-911, Pub. L. 106-387; Sec. 221, Pub. L. 107-56; E.O. 12058, 43 FR 20947, 3 CFR, 1978 Comp., p. 179; E.O. 12851, 58 FR 33181, 3 CFR, 1993 Comp., p. 608; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 12947, 60 FR 5079, 3 CFR, 1995 Comp., p. 356; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13099, 63 FR 45167, 3 CFR, 1998 Comp., p. 208; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13224, 66 FR 49079, 3 CFR, 2001 Comp., p. 786; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of October 27, 2006, 71 FR 64109 (October 31, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007).

          11. Revise § 744.21(d) to read as follows:

            § 744.21
            Restrictions on certain military end-uses in the People's Republic of China.

            (d) License application procedure. When submitting a license application pursuant to this section, you must state in the “additional information” block of the application that “this application is submitted because of the license requirement in § 744.21 of the EAR (Restrictions on Certain Military End-uses in the People's Republic of China).” In addition, either in the additional information block or in an attachment to the application, you must include all known information concerning the military end-use of the item(s). If you submit an attachment with your license application, you must reference the attachment in the “additional information” block of the application.

          PART 748—[AMENDED]
          12. The authority citation for 15 CFR part 748 continues to read as follows:

            Authority:
            50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007).

          13. In § 748.1, revise paragraph (a) and add a paragraph (d) to read as follows:

            § 748.1
            General provisions.
            (a) Scope. In this part, references to the Export Administration Regulations or EAR are references to 15 CFR chapter VII, subchapter C. The provisions of this part involve requests for classifications and advisory opinions, export license applications, encryption review requests, reexport license applications, and certain license exception notices subject to the EAR. All terms, conditions, provisions, and instructions, including the applicant and consignee certifications, contained in such form(s) are incorporated as part of the EAR. For the purposes of this part, the term “application” refers to both electronic applications and the Form BIS-748P: Multipurpose Application.

            (d) Electronic Filing Required. All export and reexport license applications (other than Special Comprehensive License Applications), encryption review requests, license exception AGR notifications, and classification requests and their accompanying documents must be filed via BIS's Simplified Network Application Processing system (SNAP-R), unless BIS authorizes submitting such applications via the paper forms BIS 748-P (Multipurpose Application Form), BIS-748P-A (Item Appendix) and BIS-748P-B, (End-User Appendix). Only original paper forms may be used. Facsimiles or reproductions are not acceptable.
            (1) Reasons for authorizing paper submissions. BIS will process paper applications notices or requests if the submitting party meets one or more of the following criteria:
            (i) BIS has received no more than one submission (i.e. the total number of export license applications, reexport license applications, encryption review requests, license exception AGR notifications, and classification requests) from that party in the twelve months immediately preceding its receipt of the current submission;
            (ii) The party does not have access to the Internet;
            (iii) BIS has rejected the party's electronic filing registration or revoked its eligibility to file electronically;
            (iv) BIS has requested that the party submit a paper copy for a particular transaction; or
            (v) BIS has determined that urgency, a need to implement U.S. government policy or a circumstance outside the submitting party's control justify allowing paper submissions in a particular instance.
            (2) Procedure for requesting authorization to file paper applications, notifications, or requests. The applicant must state in Block 24 or as an attachment to the paper application (Form BIS 748-P) which of the criteria in paragraph (d)(1) of this section it meets and the facts that support such statement. Submit the completed application, notification or request to Bureau of Industry and Security, U.S. Department of Commerce, P.O. Box 273, Washington, DC 20044 (U.S. Mail deliveries only) or to Bureau of Industry and Security, U.S. Department of Commerce, 14th Street and Pennsylvania, NW., Room H2705, Washington, DC 20230.
            (3) BIS decision. If BIS authorizes or requires paper filing pursuant to this section, it will process the application, notification or request in accordance with Part 750 of the EAR. If BIS rejects a request to file using paper, it will return the Form BIS-748P and all attachments to the submitting party without action and will state the reason for the rejection.

            § 748.2
            [Amended]
            14. In § 748.2, remove paragraph (c).
            15. In § 748.3, revise paragraph (b) introductory text, paragraph (b)(2), and the first sentence of paragraph (c) to read as follows:

            § 748.3
            Classification requests, advisory opinions, and encryption review requests.

            (b) Classification requests. Submit classification requests in accordance with the procedures in § 748.1.

            (2) When submitting a classification request, you must complete Blocks 1 through 5, 14, 22(a), (b), (c), (d), and (i), 24, and 25 on the application. You must provide a recommended classification in Block 22(a) and explain the basis for your recommendation based on the technical parameters specified in the appropriate ECCN in Block 24. If you are unable to determine a recommended classification for your item, include an explanation in Block 24, identifying the ambiguities or deficiencies that precluded you from making a recommended classification. See Supplement No. 1 to this part for information to be included in blocks other than Block 24.
            (c) Advisory Opinions. Advisory opinion requests must be in writing and be submitted to the address listed in § 748.1(d)(2). * * *

            16. In § 748.4(b)(2)(ii) revise the first sentence to read as follows:

            § 748.4
            Basic guidance related to applying for a license.

            (b) * * *
            (2) * * *
            (ii) Application. Block 7 of the application (documents on file with applicant) must be marked “other” and Block 24 (Additional information) must be marked “748.4(b)(2)” to indicate that the power of attorney or other written authorization is on file with the agent. * * *

            17. In § 748.6, revise paragraph (a), the first sentence of paragraph (b) and paragraph (e) to read as follows:

            § 748.6
            General instructions for license applications.
            (a) Instructions. General instructions for filling out license applications are in Supp. No. 1 to this part. Special instructions for applications involving certain transactions are listed in § 748.8 and described fully in Supp. No. 2 to this part.
            (b) Application Control Number. Each application has an application control number. * * *

            (e) Attachments to applications. Documents required to be submitted with applications filed via SNAP-R must be submitted as PDF files using the procedures described in SNAP-R. Documents required to be submitted with paper applications must bear the application control number to which they relate and, if applicable, be stapled to the paper form. Where necessary, BIS may require you to submit additional information beyond that stated in the EAR confirming or amplifying information contained in your license application.

          PART 754—[AMENDED]
          18. The authority citation for 15 CFR part 754 continues to read as follows:

            Authority:
            50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; 10 U.S.C. 7420; 10 U.S.C. 7430(e); 30 U.S.C. 185(s), 185(u); 42 U.S.C. 6212; 43 U.S.C. 1354; 46 U.S.C. app. 466c; E.O. 11912, 41 FR 15825, 3 CFR, 1976 Comp., p. 114; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007).

          19. In § 754.2, revise paragraphs (g)(1) and (g)(5)(i) to read as follows:

            § 754.2
            Crude oil.

            (g) Exports of certain California crude oil. * * *
            (1) Applicants must submit their applications in accordance with §§ 748.1, 748.4 and 748.6 of the EAR.

            (5) * * *
            (i) BIS will issue licenses for approved applications in the order in which the applications are received, with the total quantity authorized for any one license not to exceed 25 percent of the annual authorized volume of California heavy crude oil.

            20. In § 754.4, revise paragraphs (d)(1), (d)(2), and the introductory text of paragraph (d)(3) to read as follows:

            § 754.4
            Unprocessed Western Red Cedar.

            (d) * * *
            (1) Applicants requesting to export unprocessed western red cedar must apply for a license in accordance § 748.1, 748.4 and 748.6 of the EAR, submit any other documents as may be required by BIS, and submit a statement from an authorized representative of the exporter, reading as follows:

              I, (Name) (Title) of (Exporter) HEREBY CERTIFY that to the best of my knowledge and belief the (Quantity) (cubic meters or board feed scribner) of unprocessed western red cedar timber that (Exporter) proposes to export was not harvested from State or Federal lands under contracts entered into after October 1, 1979.

              Signature

              Date

            (2) In Blocks 16 and 18 of the application, “Various” may be entered when there is more than one purchaser or ultimate consignee.
            (3) For each application submitted, and for each export shipment made under a license, the exporter must assemble and retain for the period described in part 762 of the EAR, and produce or make available for inspection, the following:

            21. In § 754.5 revise the second sentence of paragraph (b)(2) to read as follows:

            § 754.5
            Horses for export by sea.

            (b) * * *
            (2) * * * You must provide a statement in the additional information section of the application certifying that no horse under consignment is being exported for the purpose of slaughter.

            22. In Supplement No. 2 to Part 754, revise the text to footnote number 2 in the table to read as follows:
            Supplement No. 2 to Part 754—Western Red Cedar

                2 Report commodities on license applications in the units of quantity indicated.

          PART 764—[AMENDED]
          23. The authority citation for 15 CFR part 764 continues to read as follows:

            Authority:
            50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007).

          24. In § 764.7, revise the second sentence of paragraph (b)(2)(i) to read as follows:

            § 764.7
            Activities involving items that may have been illegally exported or reexported to Libya.

            (b) * * *
            (2) * * *
            (i) * * * License applications should be submitted in accordance with §§ 748.1, 748.4 and 748.6 of the EAR, and should fully describe the relevant activity within the scope of § 764.2(e) of this part which is the basis of the application. * * *

          PART 772—[AMENDED]
          25. The authority citation for 15 CFR part 772 continues to read as follows:

            Authority:
            50 U.S.C. app. 2401 et seq.; 50 U.S.C. 1701 et seq.; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 3, 2006, 71 FR 44551 (August 7, 2006); Notice of August 15, 2007, 72 FR 46137 (August 16, 2007).

          26. In § 772.1 revise the second sentence of the definition of the term “Other party authorized to receive license.”

            § 772.1
            Definitions of terms as used in the Export Administration Regulations (EAR).

              Other party authorized to receive license. * * * If a person and address is listed in Block 15 of the application, the Bureau of Industry and Security will send the license to that person instead of the applicant.

            Dated: October 15, 2007.
            Matthew S. Borman,
            Deputy Assistant Secretary for Export Administration.

      [FR Doc. E7-20655 Filed 10-18-07; 8:45 am]
      BILLING CODE 3510-33-P


        DEPARTMENT OF THE TREASURY
        48 CFR Chapter 10
        RIN 1505-AC40
        Department of the Treasury Acquisition Regulations; Contract Clause on Minority and Women Inclusion in Contractor Workforce

          AGENCY:
          Departmental Offices, Treasury.

          ACTION:
          Notice of proposed rulemaking.

          SUMMARY:
          The Department of the Treasury (the Department) is proposing to amend the Department of the Treasury Acquisition Regulation (DTAR) to include a contract clause on minority and women inclusion, as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the Dodd-Frank Act).

          DATES:

            Comment due date: October 22, 2012.

          ADDRESSES:
          Interested persons are invited to submit comments on all aspects of this proposed rule through one of these methods:

            Electronic Submission of Comments. Interested persons may submit comments electronically through the Federal eRulemaking Portal at http://www.regulations.gov. Electronic submission of comments allows the commenter maximum time to prepare and submit a comment, ensures timely receipt, and enables the Department to make them available to the public. Comments submitted electronically through the http://www.regulations.gov Web site can be viewed by other commenters and interested members of the public.

            Mail: Department of the Treasury, Office of Minority and Women Inclusion, Attention: Contractor Clause, Room 2438, 1500 Pennsylvania Avenue NW., Washington, DC 20220.
          Fax and email comments will not be accepted.

            Instructions: In general, the Department will enter all comments received into the docket and make them available, without change, including any business or personal information that you provide such as name and address information, email addresses, or phone numbers. Comments, including attachments and other supporting materials, received are part of the public record and subject to public disclosure. Do not enclose any information in your comment or supporting materials that you consider confidential or inappropriate for public disclosure. Properly submitted comments will be available for inspection and downloading at http://www.regulations.gov.
          You may personally inspect comments at the Department of the Treasury Library, Room 1428, Main Treasury Building, 1500 Pennsylvania Avenue NW., Washington, DC. You can make an appointment to inspect comments by calling (202) 622-0990.

          FOR FURTHER INFORMATION CONTACT:

          Lorraine Cole, Director, Office of Minority and Women Inclusion, 202-927-8181 or lorraine.cole@treasury.gov.

        SUPPLEMENTARY INFORMATION:
        Section 342 of the Dodd-Frank Act, 12 U.S.C. 5452, establishes an Office of Minority and Women Inclusion (OMWI) in each of certain agencies, including the Departmental Offices of the Department of the Treasury. Section 342(c)(2) provides that covered agencies shall require contractors to provide a written statement that the “contractor shall ensure, to the maximum extent possible, the fair inclusion of women and minorities in the workforce of the contractor, and as applicable, subcontractors.” This rule will implement the statement required by the Dodd-Frank Act through a contract clause.
        The proposed contact clause, which is similar to those adopted by other OMWI agencies, requires that a contractor make good faith efforts to include minorities and women in its workforce. This standard is derived from section 342(c)(3) of the Dodd-Frank Act, which provides for remedies, including termination, against a contractor who fails to make good faith efforts to include minorities and women in its workforce. Treasury interprets “good faith efforts” to mean efforts consistent with the Equal Protection Clause of the Constitution and Title VII of the Civil Rights Act of 1964, such as the identification and elimination of employment barriers, the widespread publication of employment opportunities, and other forms of outreach to minorities and women.
        Section 342 applies to “all contracts * * * for services of any kind,” but the section does not define the term “contract.” Treasury proposes to apply the clause to all service contracts above the simplified acquisition threshold. As noted above, section 342 applies to Treasury Departmental Offices (DO). DO does not currently include an office responsible for operational procurement; acquisitions in support of DO are performed primarily by the Internal Revenue Service Office of Treasury Procurement Services. The clause will be included in all contracts in support of requirements originating from DO, regardless of the Treasury component performing the acquisition.
        Procedural Matters
        Public Comment
        Because this proposed rule relates to public contracts, it is exempt from the requirements of 5 U.S.C. 553. However, it is being published for public comment pursuant to 41 U.S.C. 1707.
        Regulatory Flexibility Act Analysis
        The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) generally requires agencies to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute; unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. It is hereby certified that this rule will not have a significant economic impact on a substantial number of small entities and thus no initial regulatory flexibility analysis is required.
        First, this rule will not affect a substantial number of small entities. While this rule will affect all contracts for services above the simplified acquisition threshold ($150,000), it will not affect a substantial number of small entities because it will only apply to those entities that actually contract with Departmental Offices. In fiscal year 2011, DO contracted with 370 small businesses.
        Additionally, the rule's economic impact is not expected to be significant. The rule satisfies the statutory requirement that contractors affirm a commitment to the fair inclusion of minorities and women in the workforce, but does so in a way that minimizes burden on contractors. The rule provides maximum flexibility for contractors in implementing the statutory requirement because it does not impose any specific requirements on contractor hiring. Further, most contractors are already subject to and have implemented other FAR requirements that will satisfy this rule's requirements. Essentially all contracts to which this requirement applies are subject to FAR Clause 52.222-26, Equal Opportunity, which requires, among other things, that contractors complete the EEO Form 1 containing workforce demographic data. Thus, contractors are already required to compile and retain much of the data required by this clause. Further, contractors with over 50 employees are required by Department of Labor regulations to develop affirmative action plans; development of and compliance with such a plan would normally satisfy the requirements of the clause.
        Notwithstanding the certification that this rule, if finalized, would not have a significant economic impact on a substantial number of small entities, the Department invites comments on the rule's impact on small entities.
        Executive Order 12866
        This proposed rule is not a “significant regulatory action” for the purposes of Executive Order 12866.
        Paperwork Reduction Act
        The information collections contained in the notice of proposed rulemaking have been previously approved by the Office of Management and Budget (OMB) and assigned control number 1505-0080. Under the Paperwork Reduction Act (44 U.S.C. chapter 35), an agency may not conduct or sponsor and a person is not required to respond to a collection of information unless it displays a valid OMB control number.

          Lists of Subjects in 48 CFR Parts 1022 and 1052
          Government procurement.

          Dated: August 8, 2012.
          Lorraine Cole,
          Director, Office of Minority and Women Inclusion, Department of the Treasury.

        For the reasons set forth in the preamble, the Department proposes to amend 48 CFR Chapter 10 as follows:

          SUBCHAPTER D—SOCIOECONOMIC PROGRAMS

            PART 1022—MINORITY AND WOMEN INCLUSION
            1. Add part 1022 to read as follows:

                Subpart 1022.7—Fair Inclusion of Minorities and Women in Contractor's Workforce
                Sec.
                1022.7000
                Contract clause.

              Authority:
              12 U.S.C. 5452.

              Subpart 1022.7—Fair Inclusion of Minorities and Women in Contractor's Workforce
              1022.7000
              Contract clause.

            Insert the clause at 1052.222-70, Minority and Women Inclusion, in all solicitations and contracts in support of Departmental Offices for services that exceed the simplified acquisition threshold.

          SUBCHAPTER H—CLAUSES AND FORMS

            PART 1052—SOLICITATION PROVISIONS AND CONTRACT CLAUSES
            2. Add subpart 1052.2 to read as follows:

                Subpart 1052.2—Texts of Provisions and Clauses
                Sec.
                1052.222-70
                Minority and Women Inclusion.

              Authority:
              12 U.S.C. 5452(c)(2).

              Subpart 1052.2—Texts of Provisions and Clauses

                § 1052.222-70
                 Minority and women inclusion.
                As prescribed in 1022.7000, insert the following clause:
                “Contractor confirms its commitment to equal opportunity in employment and contracting. To implement this commitment, the Contractor shall ensure, to the maximum extent possible consistent with applicable law, the fair inclusion of minorities and women in its workforce. The Contractor shall insert the substance of this clause in all subcontracts under this Contract whose dollar value exceeds $150,000. Within ten business days of a written request from the contracting officer, or such longer time as the contracting officer determines, and without any additional consideration required from the Agency, the Contractor shall provide documentation, satisfactory to the Agency, of the actions it (and as applicable, its subcontractors) has undertaken to demonstrate its good faith effort to comply with the aforementioned provisions. For purposes of this contract, “good faith effort” may include actions by the contractor intended to identify and, if present, remove barriers to minority and women employment or expansion of employment opportunities for minorities and women within its workforce. Efforts to remove such barriers may include, but are not limited to, recruiting minorities and women, providing job-related training, or other activity that could lead to those results.
                “The documentation requested by the contracting officer to demonstrate “good faith effort” may include, but is not limited to, one or more of the following:
                1. The total number of Contractor's employees, and the number of minority and women employees, by race, ethnicity, and gender (e.g., an EEO-1);
                2. A list of subcontract awards under the Contract that includes: dollar amount, date of award, and subcontractor's race, ethnicity, and/or gender ownership status;
                3. Information similar to that required in item 1, above, with respect to each subcontractor; and/or
                4. The Contractor's plan to ensure that minorities and women have appropriate opportunities to enter and advance within its workforce, including outreach efforts.
                “Consistent with Section 342(c)(3) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Pub. L. 111-203) (Dodd-Frank Act), a failure to demonstrate to the Director of the Agency's Office of Minority and Women Inclusion such good faith efforts to include minorities and women in the Contractor's workforce (and as applicable, the workforce of its subcontractors), may result in termination of the Contract for default, referral to the Office of Federal Contract Compliance Programs, or other appropriate action.
                “For purposes of this clause, the terms “minority,” “minority-owned business” and “women-owned business” shall have the meanings set forth in Section 342(g) of the Dodd-Frank Act.”

      [FR Doc. 2012-20385 Filed 8-20-12; 8:45 am]
      BILLING CODE 4810-25-P