2010-11927. Administrative Waivers of the Coastwise Trade Laws: New Definition for Eligible Vessel

AGENCY:

Maritime Administration, Department of Transportation.

ACTION:

Final rule.

SUMMARY:

The Maritime Administration (MARAD) is changing the definition of “eligible vessel” to be considered for a waiver of the coastwise laws to operate as small passenger vessels or uninspected passenger vessels authorized to carry no more than 12 passengers for hire. The new definition of “eligible vessel” deletes the requirement that the eligible vessel be five net tons or more. That requirement is not in the enabling statute and is preventing MARAD from considering waiver requests from small vessels. In addition, the mailing address of the agency needs to be updated to reflect the agency's present address.

DATES:

This final rule will be effective June 21, 2010.

Docket: For access to the docket to read background documents, go to http:// www.regulations.gov at any time to view docket number 2010-0012 or to Room PL-401 of the Department of Transportation, 1200 New Jersey Avenue, SE., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

FOR FURTHER INFORMATION CONTACT:

Joann Spittle, Office of Cargo Preference and Domestic Trade, Maritime Administration, MAR-730, Room W21-203, 1200 New Jersey Avenue, SE., Washington, DC 20590. Telephone: [phone] or 800-9US-FLAG; e-mail: [e-mail].

SUPPLEMENTARY INFORMATION:

Public Law 105-383 authorized the Secretary of Transportation to grant waivers of the U.S.-build requirement for the smallest of passenger vessels (those carrying 12 or fewer passengers) to operate in the coastwise trade. It also authorized the Secretary of [Homeland Security] to issue a certificate of documentation with an appropriate endorsement for employment in the coastwise trade as a small passenger vessel or an uninspected passenger vessel for eligible vessels authorized to carry no more than 12 passengers for hire if the Secretary of Transportation, after notice and an opportunity for public comment, determines that the employment of the vessel in the coastwise trade will not adversely affect: (1) United States vessel builders; or (2) the coastwise trade business of any person that employs vessels built in the United States in that business.

Until now, the term “eligible vessel” was understood to mean a vessel eligible for U.S. Coast Guard documentation, which applies to vessels of a minimum size of five net tons. However, under 46 U.S.C. 12102(b), a vessel of less than five net tons may engage in the coastwise trade without documentation, if the vessel otherwise satisfies the requirements to engage in the trade. An unintended consequence of the current small passenger waiver regulation is that the Maritime Administration is unable to grant waivers to owners of vessels of less than five net tons who want to operate in coastwise trade.

On January 27, 2010, MARAD published a notice of proposed rulemaking providing for a public comment period of 60 days. No comments were received on this proposal. Accordingly, in this final rule, the Maritime Administration adopts the rule, as proposed. The rule extends the eligibility of vessels for its Small Vessel Waiver Program by removing the five net ton minimum requirement.

Vessels eligible for a waiver of the coastwise trade laws will be limited to foreign built or foreign re-built small passenger vessels and uninspected passenger vessels as defined by section 2101 of Title 46, United States Code. Additionally, vessels requested for consideration must be greater than three years old. We will not grant waivers in instances where such waivers will have an unduly adverse effect on U.S. vessel builders or U.S. businesses that use U.S. flag vessels. Under Title V, MARAD also has the authority to revoke coastwise endorsements under the limited circumstances where a foreign-built or foreign-rebuilt passenger vessel, previously allowed into service, is deemed to have obtained such endorsement through fraud. In addition, the final rule changes the mailing address of the agency found at 46 CFR 388.3(a)(2) to reflect the agency's present address.

Rulemaking Analysis and Notices

Executive Order 12866 and DOT Regulatory Policies and Procedures

This final rule is not significant under section 3(f) of Executive Order 12866, and as a consequence, OMB did not review the rule. This final rule is not significant under the Regulatory Policies and Procedures of the Department of Transportation (44 FR 11034; February 26, 1979). The costs and benefits associated with this rulemaking are considered to be so minimal that no further regulatory impact analysis is necessary.

Executive Order 1313

We analyzed this rulemaking in accordance with the principles and criteria contained in E.O. 13132 (“Federalism”) and have determined that it does not have sufficient Federalism implications to warrant the preparation of a Federalism summary impact statement. This rule has no substantial effects on the States, or on the current Federal-State relationship, or on the current distribution of power and responsibilities among the various local officials. Therefore, consultation with State and local officials was not necessary.

Regulatory Flexibility Act

The Regulatory Flexibility Act requires MARAD to assess the impact that regulations will have on small entities. After analysis of this final rule, I certify that this final rule will not have a significant economic impact on a substantial number of small entities. Although we expect many applicants for vessel waivers to be small businesses, we do not believe that the economic impact will be significant. This rule allows MARAD to waive the U.S.-build and other requirements for eligible vessels and provides a small economic benefit to applicants. This regulation will only allow vessels to carry the statutory maximum of 12 passengers. As a consequence, MARAD estimates that a vessel owner who receives a waiver may earn a few hundred dollars per year for localized operations (geographic restrictions apply), such as whale watching and personalized fishing expeditions. Also, the economic impact of this rule is limited because it precludes vessel owners from participating in other economic activities, such as carrying cargo and commercial fishing.

Environmental Assessment

This rule is not expected to have a significant effect on the human and natural environment, individually or cumulatively, and is categorically excluded from further documentation requirements under the National Environmental Policy Act (NEPA) by Maritime Administrative Order 600-1, Categorical Exclusion No. 3. In pertinent part, Categorical Exclusion No. 3 applies to: “promulgation of rules, regulations, directives, and amendments thereto which do not require a regulatory impact analysis under section 3 of Executive Order 12291 or do not have a potential to cause a significant effect on the environment.”

Paperwork Reduction Act

The Office of Management and Budget (OMB) has reviewed and approved the information collection requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501, et seq.) The OMB approval number is 2133-0529.

Unfunded Mandates Reform Act

This final rule does not impose unfunded mandates under the Unfunded Mandates Reform Act of 1995. It does not result in costs of $141.3 million or more to either State, local, or tribal governments, in the aggregate, or to the private sector, and is the least burdensome alternative that achieves the objectives of the rule. Department guidance requires the use of a revised threshold figure of $141.3 million, which is the value of $100 million in 2008 after adjusting for inflation.

Consultation and Coordination With Indian Tribal Governments

MARAD believes that regulations evolving from this final rule would have no significant or unique effect on the communities of Indian tribal governments when analyzed under the principles and criteria contained in Executive Order 13084 (Consultation and Coordination with Indian Tribal Governments). Therefore, the funding and consultation requirements of this Executive Order would not apply.

Regulation Identifier Number (RIN)

A regulation identifier number (RIN) is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. The RIN number contained in the heading of this document can be used to cross-reference this action with the Unified Agenda.

Privacy Act

Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78).

List of Subjects in 46 CFR Part 388

• Adminsitrative practice and procedure
• Maritime carriers
• Passenger vessels
• Reporting and recordkeeping requirements

Accordingly, the Maritime Administration amends part 388, 46 CFR chapter II, subchapter J, to read as follows:

PART 388—ADMINISTRATIVE WAIVERS OF THE COASTWISE TRADE LAWS

Authority: 46 App. U.S.C. 1114(b); Pub. L. 105-383, 112 Stat. 3445 (46 U.S.C. 12121): 49 CFR 1.66.

1. In § 388.2, revise paragraph (c) to read as follows.

§ 388.2

Definitions.

* * * * *

(c) Eligible Vessel means a vessel that—is either a small passenger vessel or an uninspected passenger vessel that—

(1) Was not built in the United States and is at least 3 years of age; or

(2) If rebuilt, was rebuilt outside the United States at least 3 years before the certificate of documentation with appropriate endorsement if granted, would become effective.

* * * * *

2. In § 388.3, revise the introductory paragraphs of paragraphs (a) and (a)(2) to read as follows:

§ 388.3

Application and fee.

(a) An owner of a vessel may choose either of two methods to apply for an administrative waiver of the coastwise trade laws of the United States for an eligible vessel to carry no more than twelve passengers for hire.

* * * * *

(2) Alternatively, applicants may send written applications to Small Passenger Vessel Waiver Applications, Office of Cargo Preference, MAR-730, 1200 New Jersey Ave., SE., Washington, DC 20590. Written applications need not be in any particular format, but must be signed, be accompanied by a check made out to the order of “Maritime Administration,” and contain the following information:

* * * * *

By the order of the Maritime Administrator.

Dated: May 10, 2010.

Christine Gurland,

Secretary, Maritime Administration.