Federal Register proposed rules — 1996-06-11

Published Federal Register documents, not public-inspection drafts. The GPO XML/text rendition is a research aid; the linked complete official PDF retains the printed layout and all graphics. Graphics are retained in that PDF and are not independently reproduced in this text rendition. Publication does not establish that every provision remains legally in force.

FR Doc. 96-14807 Approval and Promulgation of Air Quality Implementation Plans; Pennsylvania; Extension of Comment Period

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Page 29508]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14807]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[PA 52-2-7155; FRL-5506-9]

Approval and Promulgation of Air Quality Implementation Plans; 
Pennsylvania; Extension of Comment Period

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of extension of public comment period.

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SUMMARY: EPA is reopening the comment period for a proposed rule 
published on April 9, 1996 (61 FR 15744). In the April 9, 1996 notice, 
EPA proposed to approve a reasonably available control technology 
(RACT) requirements for 21 Pennsylvania sources of volatile organic 
compounds (VOCs) or nitrogen oxides (NOX). At the request of the 
New York State Department of Environmental Conservation, EPA is 
reopening the comment period through June 10, 1996, only as it pertains 
to the RACT determinations for Pennsylvania Power--New Castle plant and 
International Paper--Hammermill Division. All comments received on or 
before June 10, 1996, including those received between the close of the 
comment period on May 9 and the publication of this notice, will be 
entered into the public record and considered by EPA before taking 
final action on the proposed rule.

DATES: Comments are now due on or before June 28, 1996.

ADDRESSES: Comments may be mailed to Kathleen Henry, Acting Chief, 
Ozone and Mobile Sources Section, Mailcode 3AT21, U.S. Environmental 
Protection Agency, Region III, 841 Chestnut Building, Philadelphia, 
Pennsylvania 19107. Copies of the documents relevant to this action are 
available for public inspection during normal business hours at the 
Air, Radiation, and Toxics Division, U.S. Environmental Protection 
Agency, Region III, 841 Chestnut Building, Philadelphia, Pennsylvania 
19107; and Pennsylvania Department of Environmental Protection, Bureau 
of Air Quality, P.O. Box 8468, 400 Market Street, Harrisburg, 
Pennsylvania 17105.

FOR FURTHER INFORMATION CONTACT:
Cynthia H. Stahl at the U.S. EPA Region III address above, (215) 597-
9337, or after May 20, 1996, (215) 566-2180, or via e-mail at 
[email protected] pertaining to the reopening of the 
comment period for the Pennsylvania Power--New Castle and International 
Paper--Hammermill RACT determinations.

    Dated: May 9, 1996.
Stanley Laskowski,
Acting Regional Administrator, Region III.
[FR Doc. 96-14807 Filed 6-10-96; 8:45 am]
BILLING CODE 6560-50-M

Complete official Federal Register PDF

FR Doc. 96-14759 Approval and Promulgation of Implementation Plans and Designation of Areas for Air Quality Planning Purposes: Wisconsin

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29508-29515]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14759]

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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Parts 52 and 81

[WI71-01-7297; FRL-5518-8]

Approval and Promulgation of Implementation Plans and Designation
of Areas for Air Quality Planning Purposes: Wisconsin

AGENCY: Environmental Protection Agency (EPA).

[[Page 29509]]

ACTION: Proposed rule.

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SUMMARY: The EPA is proposing to approve the Wisconsin Department of
Natural Resources (WDNR) request to redesignate Kewaunee, Manitowoc,
and Sheboygan counties to attainment for ozone. In addition, EPA is
proposing to approve the section 175A maintenance plans as revisions to
the Wisconsin State Implementation Plan (SIP). This proposed rulemaking
is based upon a May 15, 1996, submittal to the EPA from the WDNR.

DATES: Comments on this proposed action must be received in writing by
July 11, 1996.

ADDRESSES: Written comments should be addressed to: Carlton T. Nash,
Chief, Regulation Development Section, Air Programs Branch (AR-18J),
United States Environmental Protection Agency, Region 5, 77 West
Jackson Boulevard, Chicago, Illinois 60604.
Copies of the State's submittal and EPA's analysis are available
for inspection at the following location: United States Environmental
Protection Agency, Region 5, Air and Radiation Division, 77 West
Jackson Boulevard, Chicago, Illinois 60604. (It is recommended that you
telephone Randy Robinson at (312) 353-6713 before visiting the Region 5
Office.)

FOR FURTHER INFORMATION CONTACT: Randy Robinson at (312) 353-6713.

SUPPLEMENTARY INFORMATION:

I. Background

In accordance with requirements of the Clean Air Act Amendments
(Act) of 1990, Kewaunee, Sheboygan, and Manitowoc Counties were
designated as ozone nonattainment areas on November 6, 1991, (56 FR
56850). Kewaunee and Manitowoc were designated as moderate ozone
nonattainment areas. Sheboygan was originally designated as a serious
ozone nonattainment area, but that classification was changed from
serious to moderate on November 30, 1992, (57 FR 56762). The
nonattainment designations were based on air quality monitored
violations of the ozone National Ambient Air Quality Standards (NAAQS).
Recent air quality data shows that none of the three counties are
in violation of the ozone NAAQS. Therefore, the counties of Manitowoc,
Sheboygan, and Kewaunee, are eligible for redesignation to attainment
based on a minimum of 3 years of ``clean'' air quality data, as
required in the Act. On May 15, 1996, the WDNR submitted requests for
redesignation to attainment and maintenance plans for ozone for
Kewaunee County, Manitowoc County, and Sheboygan County. The remainder
of this document will discuss the regulatory requirements for
redesignation to attainment, the details of the Wisconsin draft
submittals, and EPA's recommended rulemaking action.

II. Redesignation Review Criteria

The Act provide the requirements for redesignating a nonattainment
area to attainment. Specifically, section 107(d)(3)(E) provides for
redesignation if: (i) The Administrator determines that the area has
attained the National Ambient Air Quality Standard (NAAQS); (ii) the
Administrator has fully approved the applicable implementation plan for
the area under section 110(k); (iii) the Administrator determines that
the improvement in air quality is due to permanent and enforceable
reductions in emissions resulting from implementation of the applicable
implementation plan and applicable Federal air pollutant control
regulations and other permanent and enforceable reductions; (iv) the
Administrator has fully approved a maintenance plan for the area as
meeting the requirements of section 175(A); and (v) the State
containing such area has met all requirements applicable to the area
under section 110 and Part D.
The EPA provided guidance on redesignation in the General Preamble
for the Implementation of Title I of the Clean Air Act Amendments of
1990, 57 FR 13498, (April 16, 1992), supplemented at 57 FR 18070,
(April 28, 1992) (General Preamble). Three key memoranda provide
further guidance with respect to section 107(d)(3)(E) of the Act. The
first, dated September 4, 1992, was issued by John Calcagni, Director,
Air Quality Management Division, Subject: Procedures for Processing
Requests to Redesignate Areas to Attainment (Calcagni Memorandum). The
second, dated September 17, 1993, was issued by Michael Shapiro, Acting
Assistant Administrator for Air and Radiation, Subject: State
Implementation Plan (SIP) Requirements for Area Submitting Requests for
Redesignation to Attainment of the Ozone and Carbon Monoxide (CO) NAAQS
on or after November 15, 1992, (Shapiro Memorandum). The third, dated
October 14, 1994, was issued by Mary Nichols, Assistant Administrator
for Air and Radiation, Subject: Part D New Source Review Requirements
for Areas Requesting Redesignation to Attainment (Nichols Memorandum).

Analysis of State Submittal

A. The Area Must Have Attained the Ozone National Ambient Air Quality
Standard (NAAQS)
An area may be considered attaining the ozone NAAQS if there are no
violations of the NAAQS, as determined in accordance with 40 CFR 50.9,
based on 3 complete, consecutive calendar years of quality assured
monitoring data. The data that are used should be the product of
ambient monitoring that is representative of the area believed to have
the highest concentration. A violation of the NAAQS occurs when the
annual average number of expected daily exceedances is equal to or
greater than one at any site under consideration. A daily exceedance
occurs when the maximum hourly ozone concentration during a given day
exceeds 0.124 parts per million (ppm). The data should be collected and
quality-assured in accordance with 40 CFR Part 58, and recorded in the
Aerometric Information Retrieval System (AIRS). The monitors should
have remained at a location representative of the area's ozone air
quality for the duration of the monitoring period required for
demonstrating attainment.
Kewaunee County contains one ozone monitor, located just south of
the town of Kewaunee, close to Lake Michigan. The monitor was moved to
this site in 1994 from a previous location about one mile to the
northwest. The monitor had been located in a room at Kewaunee High
School, which the school wanted to reclaim. Kewaunee High School is
located in the town of Kewaunee, about one-half mile from Lake
Michigan.
The Sheboygan County monitor is located approximately 5 miles south
of the city of Sheboygan and about a mile from Lake Michigan. The
monitor has been in operation at this site since 1977.
Manitowoc County has two ozone monitors which operate during the
April 15 to October 15 ozone season. The Collins Fire Tower site was
initiated in 1992 after high ozone levels were measured during the Lake
Michigan Ozone Study field study, conducted in the summer of 1991. The
second monitor is at the Woodland Dunes Nature Conservancy. The monitor
was moved to this location in 1994 from the Washington Jr. High School
site. The move was needed to ensure adequate access to the monitoring
equipment and also to provide sufficient space for the additional
monitoring equipment required for the Photochemical Air Monitoring
Stations (PAMS). The PAMS sites are required by the Act and

[[Page 29510]]

measure more pollutants than traditional ozone monitoring stations. The
EPA stated, in a letter dated March 21, 1995, to WDNR, that the ozone
monitoring data from the new site may be considered as a continuation
from the old site.
To demonstrate monitored attainment with the standard, the WDNR
submitted ozone monitoring data for the April 15 to October 15 ozone
season for 1993, 1994, and 1995 for Kewaunee, Sheboygan, and Manitowoc
Counties. The annual average expected exceedance for this 3-year time
period, for each county is 0.67, 0.67, and 1.0, respectively. No
violations were recorded during this 3-year time period. The three
counties have attained the NAAQS. This data has been quality assured
and is recorded in AIRS.
B. The Area Must Have a Fully Approved State Implementation Plan (SIP)
Under Section 110(k); and the Area Must Have Met All Applicable
Requirements Under Section 110 and Part D
In November 1991, Kewaunee and Manitowoc Counties were designated
moderate nonattainment for ozone based on monitored ozone exceedances
occurring during the years 1987-1989. Sheboygan County was classified
as moderate nonattainment in November 1992. As a result of this
designation, the WDNR was required to submit revised SIPs that meet the
requirements of the Act and demonstrate attainment and maintenance with
the ozone standards.

Section 110: General Requirements for Implementation Plans

Section 110(a)(2) of the Act lists the elements to be included in
each SIP after adoption by the State and reasonable notice and public
hearing. The elements include, but are not limited to, provisions for
establishment and operation of appropriate devices, methods, systems,
and procedures necessary to monitor ambient air quality; implementation
of a permit program, provisions for Part C (PSD) and D (NSR) permit
programs, criteria for stationary source emission control measures,
monitoring, and reporting, provisions for modeling, and provisions for
public and local agency participation. For purposes of redesignation,
the Kewaunee, Manitowoc, and Sheboygan County SIPs were reviewed to
ensure that all requirements under the Act were satisfied. EPA has
determined that the individual SIPs are consistent with the
requirements of section 110 of the Act.

Part D: General Provisions for Nonattainment Areas

Before any of the moderate nonattainment counties may be
redesignated as attainment, they must fulfill the applicable
requirements of Part D. Under Part D, an area's classification
determines the requirements to which it is subject. Subpart 1 of Part D
sets forth the basic nonattainment requirements applicable to all
nonattainment areas. Subpart 2 of Part D establishes additional
requirements for nonattainment areas classified under table 1 of
section 181(a). As described in the General Preamble, specific
requirements of Subpart 2 may override Subpart 1's general provisions,
(57 FR 13501 (April 16, 1992)). Kewaunee, Manitowoc, and Sheboygan
Counties are classified as moderate nonattainment areas. Therefore, in
order to be redesignated, the State must meet the applicable
requirements of Subpart 1 of Part D--specifically sections 172 and 176,
as well as the applicable requirements of Subpart 2 of Part D.

Section 172 Requirements

The State redesignation requests have satisfied all of the relevant
submittal requirements under section 172 necessary for the area to be
redesignated to attainment.
The reasonable further progress (RFP) requirement under section
172(c)(2) is defined as progress that must be made toward attainment.
This requirement is not relevant because all three counties have
demonstrated monitored attainment of the ozone NAAQS, (General
Preamble, 57 FR 13564).
Section 172(c)(3) requires submission and approval of a
comprehensive, accurate, and current inventory of actual emissions. The
requirement was superseded by the inventory requirement in section
182(a)(1). The WDNR submitted such an inventory on November 15, 1992.
It was approved on June 15, 1994 (59 FR 30702).
Section 172(c)(5) requires permits for the construction and
operation of new and modified major stationary sources anywhere in the
nonattainment area. The WDNR submitted information on nonattainment
area new source review rules on November 15, 1992. The rules were
approved by EPA on January 18, 1995, (60 FR 3538). The State's
Prevention of Significant Deterioration (PSD) program will become
effective in Kewaunee, Sheboygan, and Manitowoc County upon
redesignation to attainment. The State was delegated the PSD program on
November 4, 1987.

Section 176 Conformity Requirements

Section 176 of the Act requires States to revise their SIPs to
establish criteria and procedures to ensure that, before they are
taken, Federal actions conform to the air quality planning goals in the
applicable State SIP. The requirement to determine conformity applies
to transportation plans, programs and projects developed, funded or
approved under Title 23 U.S.C. or the Federal Transit Act, 49 U.S.C.A.
App. section 1601 et seq., (``transportation conformity''), as well as
to all other Federal actions (``general conformity''). Section 176
further provides that the conformity revision to be submitted by the
States must be consistent with Federal conformity regulations that the
Act required the EPA to promulgate. Congress provided for the State
revisions to be submitted 1 year after the date of promulgation of
final EPA conformity regulations.
The EPA promulgated final transportation conformity regulations on
November 24, 1993, (58 FR 62188) and general conformity regulations on
November 30, 1993, (58 FR 63214). Pursuant to Section 51.396 of the
transportation conformity rule and Section 51.851 of the general
conformity rule, the State of Wisconsin submitted a SIP revision
containing transportation and general conformity criteria and
procedures on November 23, 1994, and November 30, 1994, respectively.
The EPA has not yet approved these rules as part of the SIP.
The EPA believes it is reasonable to interpret the conformity
requirements as not being applicable requirements for purposes of
evaluating the redesignation request under section 107(d). The
rationale for this is based on a combination of two factors. First, the
requirement to submit SIP revisions to comply with the conformity
provisions of the Act continue to apply to areas after redesignation to
attainment, since such areas would be subject to a section 175A
maintenance plan. Second, EPA's Federal conformity rules require the
performance of conformity analyses in the absence of federally approved
State rules. Therefore, because areas are subject to the conformity
requirements regardless of whether they are redesignated to attainment
and must implement conformity under Federal rules if State rules are
not yet approved, the EPA believes it is reasonable to view these
requirements as not being applicable requirements for purposes of
evaluation of a redesignation request. Consequently, the ozone
redesignation requests for Kewaunee, Manitowoc, and Sheboygan County
may be approved

[[Page 29511]]

notwithstanding the lack of fully approved State transportation and
general conformity rules. This policy was also exercised in the Tampa,
Florida ozone redesignation finalized on December 7, 1995, (60 FR
62748).

Subpart 2 Section 182 Requirements

The Counties of Kewaunee, Sheboygan, and Manitowoc are classified
as moderate nonattainment. Therefore, Part D, Subpart 2, section 182(b)
requirements apply. In accordance with guidance presented in the
Shapiro memorandum, the requirements that were due prior to the
submission of the requests to redesignate the three counties must be
fully approved into the SIP before the requests to redesignate the area
to attainment can be approved. Those requirements are discussed below:
(a) 1990 Base Year Inventory
The 1990 base year emission inventory was due on November 15, 1992.
It was submitted to EPA on November 15, 1992, and approved by EPA on
June 15, 1994, (59 FR 30702).
(b) Emission Statements
The emission statements SIP was due on November 15, 1992. It was
submitted to the EPA on November 15, 1992, and approved by EPA on
December 6, 1993, (58 FR 64155).
(c) (15 Percent) Plan
The 15 percent Rate of Progress plan for VOC reductions was
submitted to EPA on November 15, 1993. The plan was approved on March
22, 1996, (61 FR 11735).
(d) Attainment Demonstration
Section 182(b)(1) requires that the 15 percent plan provide for
``such specific annual reductions in emissions . . . as necessary to
attain the national primary ambient air quality standard by the
attainment date applicable under this Act.'' However, as explained in a
memorandum from John S. Seitz, Director, Office of Air Quality Planning
and Standards, entitled ``Reasonable Further Progress, Attainment
Demonstration, and Related Requirements for Ozone Nonattainment Areas
Meeting the Ozone National Ambient Air Quality Standard,'' dated May
10, 1995, EPA believes it is appropriate to interpret the provisions
regarding attainment demonstrations, along with certain other
provisions, so as not to require SIP submittals if an ozone
nonattainment area subject to those requirements is monitoring
attainment of the ozone standard.
The EPA has determined that Kewaunee, Manitowoc, and Sheboygan
Counties have demonstrated monitored attainment with the ozone NAAQS.
As a consequence, the attainment demonstration requirement of section
182(b)(1) is not applicable to the Kewaunee, Manitowoc, and Sheboygan
Counties redesignation requests. The State must, however, continue to
operate an appropriate air quality monitoring network, in accordance
with 40 CFR Part 58, to verify the attainment status of the area.
(e) RACT Requirements
SIP revisions requiring RACT for three classes of VOC sources are
required under section 182(b)(2). The categories are:
(i) All sources covered by a Control Technology Guideline (CTG)
document issued between November 15, 1990 and the date of attainment.
(ii) All sources covered by a CTG issued prior to November 15,
1990.
(iii) All other major non-CTG stationary sources.
The State submitted VOC RACT rules, including existing CTG's and
non-CTG major sources, on September 22, 1993. EPA approved the rules on
August 15, 1994. Additional rules for yeast manufacturing and molded
wood parts or products coating and wood door finishing were approved on
June 30, 1995; screenprinting on July 28, 1995; iron and steel
foundaries on February 13, 1996; wood furniture coating on July 28,
1995; and lithographic printing on April 9, 1996.
(f) Stage II Vapor Recovery
Section 182(b)(3) requires States to submit gasoline vapor recovery
rules no later than November 15, 1992. This requirement pertains to the
recovery of emissions from the refueling of motor vehicles (i.e., Stage
II). The Wisconsin Stage II rules were submitted as a SIP revision on
November 15, 1992. On August 13, 1993, the EPA approved the State's SIP
revision for implementation of Stage II (58 FR 43080).
(g) Vehicle Inspection and Maintenance (I/M)
The EPA's final I/M regulations in 40 CFR Part 51 establish
specific requirements for certain ozone nonattainment areas to adopt
and submit plans for I/M. Under these regulations, Manitowoc and
Kewaunee counties are not required to implement an I/M program due to
lack of urbanized areas. Sheboygan county, however, is subject to the
I/M requirements and on November 15, 1993, the State of Wisconsin
submitted a SIP revision to meet the I/M requirements for Sheboygan
county. Under the I/M regulations, areas requesting redesignation must
meet certain requirements in order to receive full SIP approval for
their I/M program. For Sheboygan county, the I/M plans must contain the
following elements:
1. Legal authority to implement an I/M program.
2. A commitment by the Governor or the Governor's designee to adopt
or consider adopting an I/M program, in accordance with the maintenance
plan.
3. An enforceable schedule for adoption and implementation of the
I/M program, and appropriate milestones for implementation.
The legal authority for the I/M program in Sheboygan county was
approved by the EPA on January 12, 1995, (60 FR 2881). The program is
currently being implemented in accordance with the schedule submitted
by the State. As a result, the Sheboygan county I/M program meets the
criteria for a fully approved I/M SIP under EPA regulations.
(h) 1.15 to 1.0 Offset
Section 182(b)(5) requires all major new sources or modifications
in a moderate nonattainment area to achieve offsetting reductions of
VOCs at a ratio of at least 1.15 to 1.0. The State submitted New Source
Review rules on November 23, 1994. EPA approved the rules on January
18, 1995, (60 FR 3538).
(i) NOX Requirement
Section 182(f) establishes NOX requirements for ozone
nonattainment areas. However, it provides that these requirements do
not apply to an area if the Administrator determines that NOX
reductions would not contribute to attainment. On July 13, 1994,
Wisconsin submitted, along with Illinois, Indiana and Wisconsin, a
section 182(f) NOX petition to be relieved of the section 182(f)
NOX requirements based on urban airshed modeling (UAM). The
modeling demonstrates that NOX emission reductions would not
contribute to attainment of the NAAQS for ozone in the modeled area,
which includes Kewaunee, Sheboygan, and Manitowoc Counties area. The
EPA approved the section 182(f) petition on January 26, 1996, (61 FR
2428). However, approval of the waiver does not exempt these counties
from requirements that may be imposed as a result of the Ozone
Transport Assessment Group process.

[[Page 29512]]

C. The Improvement in Air Quality Must be Due to Permanent and
Enforceable Reductions in Emissions Resulting From the SIP, Federal
Measures and Other Permanent and Enforceable Reductions
The State must be able to reasonably attribute the improvement in
air quality to emission reductions which are permanent and enforceable.
To satisfy this requirement, the State should estimate the percent
reduction from the year that was used to determine the design value for
designation and classification achieved from Federal measures and
control measures that have been adopted and implemented by the State.
Emission rates, production capacities and other information should be
used in the estimation. Sources should be assumed to operate at
permitted or historic peak levels unless evidence is presented that
such an assumption is unrealistic.
The WDNR submittal documents changes in VOC and NOX emissions
from 1988 (the design year) to 1993 (the attainment year) for each
county. Those changes are shown in the tables below.

Kewaunee County VOC Emissions
[Tons per day]
------------------------------------------------------------------------
Sector 1988 1990 1993
------------------------------------------------------------------------
Point...................................... 0.84 0.86 0.92
Area....................................... 1.77 1.76 1.74
Mobile..................................... 2.48 2.16 1.74
----------------------------
Totals............................... 5.09 4.78 4.40
Percent Change from 1988 (design year)..... ....... -6.09 -13.56
------------------------------------------------------------------------

Kewaunee County NOx Emissions
[Tons per day]
------------------------------------------------------------------------
Sector 1988 1990 1993
------------------------------------------------------------------------
Point........................................ 0.03 0.03 0.04
Area......................................... 0.14 0.14 0.14
Mobile....................................... 2.87 2.78 2.67
--------------------------
Totals................................. 3.04 2.95 2.85
Percent Change from 1988 (design year)....... ....... -2.96 -6.25
------------------------------------------------------------------------

Sheboygan County VOC Emissions
[Tons per day]
------------------------------------------------------------------------
Sector 1988 1990 1993
------------------------------------------------------------------------
Point........................................ 6.60 6.74 7.18
Area......................................... 9.62 9.69 9.84
Mobile....................................... 10.59 9.17 7.29
--------------------------
Totals................................. 26.81 25.60 24.32
Percent Change from 1988 (design year)....... ....... -4.51 -9.32
------------------------------------------------------------------------

Sheboygan County NOX Emissions
[Tons per day]
------------------------------------------------------------------------
Sector 1988 1990 1993
------------------------------------------------------------------------
Point........................................ 55.23 56.35 60.08
Area......................................... 1.35 1.38 1.36
Mobile....................................... 16.91 16.32 15.34
--------------------------
Totals................................. 73.49 74.05 76.78
Percent Change from 1988 (design year)....... ....... +0.76 +4.48
------------------------------------------------------------------------

Manitowoc County VOC Emissions
[Tons per day]
------------------------------------------------------------------------
Sector 1988 1990 1993
------------------------------------------------------------------------
Point...................................... 1.14 1.16 1.24
Area....................................... 8.73 8.82 8.87
Mobile..................................... 9.57 8.25 6.44
----------------------------
Totals............................... 19.44 18.23 16.55
Percent Change from 1988 (design year)..... ....... -6.22 -14.86
------------------------------------------------------------------------

Manitowoc County NOX Emissions
[Tons per day]
------------------------------------------------------------------------
Sector 1988 1990 1993
------------------------------------------------------------------------
Point...................................... 3.14 3.20 3.41
Area....................................... 0.97 0.98 0.97
Mobile..................................... 15.91 15.32 13.94
----------------------------
Totals............................... 20.02 19.50 18.32
Percent Change from 1988 (design year)..... ....... -2.55 -8.44
------------------------------------------------------------------------

The tables show that VOC and NOx emissions decreased for both
Manitowoc and Kewaunee Counties from 1988 to 1993. Sheboygan VOC also
decreased during that time period. However, NOx emission increased
from 73.49 tons per day to 76.77 tons per day. The increase in NOx
emissions happened concurrently with the county's decrease in ozone and
subsequent ability to show attainment of the standard. The WDNR has
demonstrated that the improvement in air quality is due to the decrease
in VOC emissions resulting primarily from the implementation of Federal
programs. This reasoning is consistent with the NOx waiver
analysis, which showed that NOx reductions would not contribute to
attainment of the NAAQS for ozone. Emission estimates in the above
tables were back casted to 1988 from 1990 base year emissions,
according to variables such as population growth, economic growth, and
vehicle miles traveled. Although Kewaunee, Manitowoc, and Sheboygan
Counties experienced moderate economic and population growth during the
years 1988 to 1993, VOC decreased in all three counties and NOx
emissions decreased in each county except Sheboygan. The majority of
the reductions are due to lower highway motor vehicle emissions. These
reductions are directly attributable to the implementation of the
Federal Motor Vehicle Control Program (FMVCP).
D. The Area Must Have a Fully Approved Maintenance Plan Meeting the
Requirements of Section 175A
Section 175A of the Act defines requirements for maintenance plans.
The maintenance plan is a SIP revision which provides for attainment of
the relevant NAAQS in the area for at least 10 years after
redesignation. There are five core provisions that the maintenance plan
must address (Calgagni Memorandum): the attainment inventory,
maintenance demonstration, monitoring network, verification of
continued attainment, and a contingency plan. The attainment inventory
must identify the level of emissions in the area that is sufficient to
attain the ozone NAAQS and must include the emissions during the time
period associated with the monitoring data showing attainment.
Maintenance is demonstrated by showing that future emissions will not
exceed the level of the attainment inventory. The maintenance plan must
also provide for continued operation of an appropriate air quality
monitoring network to verify attainment status of the area. The plan
must indicate how the State will track the progress of the maintenance
plan. Finally, the maintenance plan must include contingency measures
which would promptly correct any violation of the ozone NAAQS that
occurs after redesignation of the area to attainment.

Attainment Inventory

The Kewaunee, Sheboygan, and Manitowoc Counties submittals
contained inventories of 1990 actual VOC and NOx emissions from
stationary, area, and mobile sources. This is the most accurate,

[[Page 29513]]

comprehensive emission inventory available for the area. The 1990
emission inventory was projected to 1993 to provide an emissions
inventory representative of attainment conditions based upon the lack
of a monitored ozone violation for the years 1992-1994.

Maintenance Demonstration

The three county submittals show projected VOC and NOX
emissions from the 1993 attainment inventory to 2007. The following
tables list the VOC and NOX emissions for the base year, interim
year and final year for each county.

Summary of Kewaunee VOC Emissions
[Tons per day]
------------------------------------------------------------------------
1993 1996 2007
Sector Attain Proj. Proj.
------------------------------------------------------------------------
Area....................................... 1.74 1.57 1.57
Point...................................... 0.92 0.76 0.98
Mobile..................................... 1.74 1.68 1.37
----------------------------
Totals............................... 4.40 4.01 3.92
Percent Change from 1993................... ....... -8.86 -10.91
------------------------------------------------------------------------

Summary of Kewaunee NOX Emissions
[Tons per day]
------------------------------------------------------------------------
1993 1996 2007
Sector Attain Proj. Proj.
------------------------------------------------------------------------
Area 0.14 0.14 0.13
Point...................................... 0.04 0.04 0.05
Mobile..................................... 2.67 2.56 2.36
----------------------------
Totals............................... 2.85 2.74 2.54
Percent Change from 1993................... ....... -3.86 -10.87
------------------------------------------------------------------------

Summary of Sheboygan VOC Emissions
[Tons per day]
------------------------------------------------------------------------
1993 1996 2007
Sector Attain Proj. Proj.
------------------------------------------------------------------------
Area....................................... 9.84 8.52 9.03
Point...................................... 7.18 7.18 9.22
Mobile..................................... 7.29 6.85 4.36
----------------------------
Totals............................... 24.31 22.55 22.61
Percent Change from 1993................... ....... -7.23 -7.00
------------------------------------------------------------------------

Summary of Sheboygan NOX Emissions
[Tons per day]
------------------------------------------------------------------------
1993 1996 2007
Sector Attain Proj. Proj.
------------------------------------------------------------------------
Area....................................... 1.36 1.36 1.27
Point...................................... 60.08 70.13 55.89
Mobile..................................... 15.34 14.33 11.63
----------------------------
Totals............................... 76.78 85.82 68.79
Percent Change from 1993................... ....... +11.77 -10.40
------------------------------------------------------------------------

Summary of Manitowoc VOC Emissions
[Tons per day]
------------------------------------------------------------------------
1993 1996 2007
Sector Attain Proj. Proj.
------------------------------------------------------------------------
Area....................................... 8.87 7.77 8.22
Point...................................... 1.24 1.22 1.59
Mobile..................................... 6.44 6.18 5.02
----------------------------
Totals............................... 16.55 15.17 14.83
Percent Change from 1993................... ....... -8.33 -10.39
------------------------------------------------------------------------

Summary of Manitowoc NOX Emissions
[Tons per day]
------------------------------------------------------------------------
1993 1996 2007
Sector Attain Proj. Proj.
------------------------------------------------------------------------
Area....................................... 0.97 0.97 0.91
Point...................................... 3.41 3.64 4.71
Mobile..................................... 13.94 12.97 10.35
----------------------------
Totals............................... 18.32 17.58 15.97
Percent Change from 1993................... ....... -4.04 -12.83
------------------------------------------------------------------------

The above tables show that the level of total emissions in the
attainment year, 1993, are not exceeded in either the interim year,
1996, or the final year, 2007. An exception to this is the NOX
emission estimate for the interim year in Sheboygan County, which is
predicted to increase by about 12 percent in 1996 but drop below
attainment year levels by 2007. The drop in emissions from 1996 to 2007
is attributable to the Act Title IV NOX requirements. To date,
this level of increase in NOX has not caused a violation of the
NAAQS. The EPA believes that the emissions projections demonstrate that
the area will continue to maintain the ozone NAAQS because this area
has achieved attainment through VOC controls and reductions.
Additionally, modeling performed to support the NOX waiver
petition showed that additional NOX reductions would not
contribute to attainment of the NAAQS.

Emission Projections

All emission projections were made from emissions calculated for
WDNR's 1990 base year inventory. The 1990 base year inventory reflects
tons per typical summer day emissions as well as an 80 percent rule
effectiveness assumption. Projections were generally based on the
following equation:

Proj.Emissions='90 Emissions*(Proj. Factor)*(1-(Cont.Effcy)*(RE)*(RP))

Where RE=rule effectiveness (default=80%), and RP=rule penetration.

Projections of stationary source emissions through the year 2007,
for all three counties, were developed based primarily on economic
growth projection factors using a growth of 1 percent per year prior to
1990 and approximately 2.3 percent per year after 1990. The area source
emissions were projected using a variety of growth factors, such as
population growth, gasoline market, vehicle miles traveled, farmland,
etc. To project future year mobile VOC emissions, a VMT growth rate of
2.0 percent was used for the period between 1988 and 2007. These
estimates were provided by the Wisconsin Department of Transportation.
The MOBILE5a model was run to produce emission factors for the years
1988, 1990, 1993, 1996, and 2007. The submittal included the input and
output files from the model runs.

Monitoring Network

There is currently one monitor measuring ozone in Kewaunee County
and one monitor in Sheboygan County. Two monitors measure ozone in
Manitowoc County. The WDNR has committed to continue operating and
maintaining an approved ozone monitor network in each of the three
counties for the 10 year maintenance period to verify the attainment
status of the area.

Contingency Plan

The contingency plans for the counties of Kewaunee, Manitowoc, and
Sheboygan contain three major components: attainment tracking,
contingency measures, and a mechanism that triggers the implementation
of the contingency measures.
The WDNR will track the progress of the maintenance plan for each
County by generating VOC and NOX emissions inventories for point,
area, and mobile sources for the years 1996, 1999, 2002, 2005, and 2007
The contingency measures to be considered for implementation for
each

[[Page 29514]]

county are (1) a lower major source applicability threshold for
industrial sources and (2) the implementation of new gasoline standards
that will lower VOC emissions. Selection of the contingency measures
will take place in the event the ozone NAAQS is violated, and if an EPA
approved analysis shows that emission sources from the county with the
monitored violation caused the violation. This analysis is being
conducted because the State has maintained that the level of ozone in
these three counties is a function of ozone and ozone precursors being
transported to the region from upwind urbanized areas such as the
greater Chicago area. The analysis will follow a protocol which WDNR
will submit to EPA for approval, within 60 days after the violation.
This protocol plan may include available meteorological data,
monitoring data, and a dispersion modeling study. The completed
analysis will then be sent to EPA for approval within 14 months of the
violation. The completed analysis will be subject to public comment. If
the analysis shows that the specific county source(s) caused the
violation, contingency measures will be implemented. In summary, the
contingency measures will be implemented according to the following
schedule:

----------------------------------------------------------------------------------------------------------------
Activity Completion time
----------------------------------------------------------------------------------------------------------------
Violation of the ozone NAAQS:
Verify violation and submit plan to analyze 60 days after violation measurement.
violation to EPA for approval.
Submit completed analysis, public notice and 14 months after violation measurement.
comment material to EPA for approval.
Lower ``major source'' threshold for 24 months after violation measurement.
industrial sources within the county with
the violation.
Gasoline standards in the county with the 24 months after violation measurement.
violation to lower VOC emissions.
----------------------------------------------------------------------------------------------------------------

The Kewaunee, Manitowoc, and Sheboygan Counties submittals
adequately address the five basic components which comprise a
maintenance plan (attainment inventory, maintenance demonstration,
monitoring network, verification of continued attainment, and a
contingency plan) and, therefore, satisfy the maintenance plan
requirements of Section 107(d)(3)(E)(iv).
E. The Area Must Have Met All Applicable Requirements Under Section 110
and Part D
Section 110 and Part D requirements were discussed under section B
above.

III. Final Rulemaking Action

The EPA is proposing to approve WDNR's request for redesignation to
attainment and 175A maintenance plan for ozone for Kewaunee, Sheboygan,
and Manitowoc County.
Nothing in this action should be construed as permitting, allowing
or establishing a precedent for any future request for revision to any
SIP. The EPA shall consider each request for revision to the SIP in
light of specific technical, economic, and environmental factors and in
relation to relevant statutory and regulatory requirements.
Ozone SIPs are designed to satisfy the requirements of Part D of
the Act and to provide for attainment and maintenance of the ozone
NAAQS. This proposed redesignation should not be interpreted as
authorizing the State to delete, alter, or rescind any of the VOC or
NOX emission limitations and restrictions contained in the
approved ozone SIP. Changes to ozone SIP VOC regulations rendering them
less stringent than those contained in the EPA approved plan cannot be
made unless a revised plan for attainment and maintenance is submitted
to and approved by EPA. Unauthorized relaxations, deletions, and
changes could result in both a finding on nonimplementation [section
173(b) of the Clean Air Act] and in a SIP deficiency call made pursuant
to section 110(a)(2)(H) of the Act.
This action has been classified as a Table 3 action for signature
by the Regional Administrator under the procedures published in the
Federal Register on January 19, 1989, (54 FR 2214-2225), as revised by
a July 10, 1995, memorandum from Mary Nichols, Assistant Administrator
for Air and Radiation. The Office of Management and Budget (OMB) has
exempted this regulatory action from Executive Order 12866 review.
Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., EPA
must prepare a regulatory flexibility analysis assessing the impact of
any proposed or final rule on small entities. (5 U.S.C. 603 and 604.)
Alternatively, EPA may certify that the rule will not have a
significant impact on a substantial number of small entities. Small
entities include small businesses, small not-for-profit enterprises,
and government entities with jurisdiction over populations of less than
50,000.
Section 202 of the Unfunded Mandates Reform Act of 1995 (``Unfunded
Mandates Act''), 2 U.S.C. 1532, requires that the EPA prepare a
budgetary impact statement before promulgating a rule that includes a
Federal mandate that may result in expenditure by State, local, and
tribal governments, in aggregate, or by the private sector, of $100
million or more in any one year. Section 203, 2 U.S.C. 1533, requires
the EPA to establish a plan for obtaining input from and informing,
educating, and advising any small governments that may be significantly
or uniquely affected by the rule.
Under section 205 of the Unfunded Mandates Act, 2 U.S.C. 1535, the
EPA must identify and consider a reasonable number of regulatory
alternatives before promulgating a rule for which a budgetary impact
statement must be prepared. The EPA must select from those alternatives
the least costly, most cost-effective, or least burdensome alternative
that achieves the objectives of the rule, unless the EPA explains why
this alternative is not selected or the selection of this alternative
is inconsistent with law.
Because this proposed rule is estimated to result in the
expenditure by State, local, and tribal governments or the private
sector of less then $100 million in any one year, the EPA has not
prepared a budgetary impact statement or specifically addressed the
selection of the least costly, most cost-effective, or least burdensome
alternative. Because small governments will not be significantly or
uniquely affected by this rule, the EPA is not required to develop a
plan with regard to small governments.
SIP approvals under section 110 and Subchapter I, Part D, of the
Clean Air Act do not create any new requirements, but simply approve
requirements that the State is already imposing. Therefore, because the
Federal SIP approval does not impose any new requirements, I certify
that it does not have a significant impact on any small entities
affected. Moreover, due to the nature of the Federal-State relationship
under the Clean Air Act, preparation of a regulatory flexibility
analysis would constitute Federal inquiry into the economic
reasonableness of the State action. The Clean Air Act forbids EPA to
base its actions concerning SIPs on

[[Page 29515]]

such grounds. Union Electric Co. v. EPA, 427 U.S. 246, 256-66 (1976).

List of Subjects

40 CFR Part 52

Environmental protection, Air pollution control, Motor vehicle
pollution, Hydrocarbons, Nitrogen oxides, Ozone, Volatile organic
compounds.

40 CFR Part 81

Environmental protection, Air pollution control, National Parks,
Wilderness Areas.

Authority: 42 U.S.C. 7401-7671q.

Dated: May 30, 1996.
Valdas V. Adamkus,
Regional Administrator.

[FR Doc. 96-14759 Filed 6-10-96; 8:45 am]
BILLING CODE 6560-50-P

Complete official Federal Register PDF

FR Doc. 96-14727 Proposed Flood Elevation Determinations

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29518-29522]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14727]

=======================================================================
-----------------------------------------------------------------------

FEDERAL EMERGENCY MANAGEMENT AGENCY

44 CFR Part 67

[Docket No. FEMA-7182]

Proposed Flood Elevation Determinations

AGENCY: Federal Emergency Management Agency, FEMA.

[[Page 29519]]

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: Technical information or comments are requested on the
proposed base (1% annual chance) flood elevations and proposed base
flood elevation modifications for the communities listed below. The
base flood elevations are the basis for the floodplain management
measures that the community is required either to adopt or to show
evidence of being already in effect in order to qualify or remain
qualified for participation in the National Flood Insurance Program
(NFIP).

DATES: The comment period is ninety (90) days following the second
publication of this proposed rule in a newspaper of local circulation
in each community.

ADDRESSES: The proposed base flood elevations for each community are
available for inspection at the office of the Chief Executive Officer
of each community. The respective addresses are listed in the following
table.

FOR FURTHER INFORMATION CONTACT: Michael K. Buckley, P.E., Chief,
Hazard Identification Branch, Mitigation Directorate, 500 C Street,
SW., Washington, DC 20472, (202) 646-2756.

SUPPLEMENTARY INFORMATION: The Federal Emergency Management Agency
(FEMA or Agency) proposes to make determinations of base flood
elevations and modified base flood elevations for each community listed
below, in accordance with section 110 of the Flood Disaster Protection
Act of 1973, 42 U.S.C. 4104, and 44 CFR 67.4(a).
These proposed base flood and modified base flood elevations,
together with the floodplain management criteria required by 44 CFR
60.3, are the minimum that are required. They should not be construed
to mean that the community must change any existing ordinances that are
more stringent in their floodplain management requirements. The
community may at any time enact stricter requirements of its own, or
pursuant to policies established by other Federal, state or regional
entities. These proposed elevations are used to meet the floodplain
management requirements of the NFIP and are also used to calculate the
appropriate flood insurance premium rates for new buildings built after
these elevations are made final, and for the contents in these
buildings.

National Environmental Policy Act

This proposed rule is categorically excluded from the requirements
of 44 CFR Part 10, Environmental Consideration. No environmental impact
assessment has been prepared.

Regulatory Flexibility Act

The Acting Associate Director, Mitigation Directorate, certifies
that this proposed rule is exempt from the requirements of the
Regulatory Flexibility Act because proposed or modified base flood
elevations are required by the Flood Disaster Protection Act of 1973,
42 U.S.C. 4104, and are required to establish and maintain community
eligibility in the National Flood Insurance Program. As a result, a
regulatory flexibility analysis has not been prepared.

Regulatory Classification

This proposed rule is not a significant regulatory action under the
criteria of section 3(f) of Executive Order 12866 of September 30,
1993, Regulatory Planning and Review, 58 FR 51735.

Executive Order 12612, Federalism

This proposed rule involves no policies that have federalism
implications under Executive Order 12612, Federalism, dated October 26,
1987.

Executive Order 12778, Civil Justice Reform

This proposed rule meets the applicable standards of section
2(b)(2) of Executive Order 12778.

List of Subjects in 44 CFR Part 67

Administrative practice and procedure, Flood insurance, Reporting
and recordkeeping requirements.

Accordingly, 44 CFR part 67 is proposed to be amended as follows:

PART 67--[AMENDED]

1. The authority citation for part 67 continues to read as follows:

Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR,
1979 Comp., p. 376.

Sec. 67.4 [Amended]

2. The tables published under the authority of Sec. 67.4 are
proposed to be amended as follows:

------------------------------------------------------------------------
#Depth in
feet above
ground.
Source of flooding and location *Elevation
in feet
(NGVD)
------------------------------------------------------------------------
Pennsylvania

-------------------------------------------------------------
Jenkintown (Borough), Montgomery County

Tacony Creek:
Approximately 200 feet upstream of Greenwood Avenue....... *206
At the confluence of Baeder Run........................... *220
Baeder Run:
At the confluence with Tacony Creek....................... *220
Approximately 586 feet upstream of confluence with Tacony
Creek.................................................... *220

Maps available for inspection at the Jenkintown Borough
Offices, 700 Summit Avenue, Jenkintown, Pennsylvania.

Send comments to Mr. John Plunkett, President of the
Jenkintown Borough Council, P.O. Box 2176, Jenkintown,
Pennsylvania 19046.

------

Lower Salford (Township), Montgomery County

Skippack Creek:
At Quarry Bridge Road..................................... *176
Near Wampole Road approximately 950 feet upstream of State
Highway 63............................................... *199
Skippack Creek Tributary No. 2:
Approximately 150 feet downstream of Wampole Road......... *211
Approximately 525 feet upstream of Wampole Road........... *212

Maps available for inspection at the Township Office, 474
Main Street, Harleysville, Pennsylvania.

Send comments to Mr. Douglas Gifford, Chairman of the Lower
Salford Township Board of Commissioners, 474 Main Street,
Harleysville, Pennsylvania 19438.
------------------------------------------------------------------------

Sec. 67.4 [Amended]

3. The tables published under the authority of Sec. 67.4 are
proposed to be amended as follows:

[[Page 29520]]

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
#Depth in feet above
ground. *Elevation in
State City/town/ county Source of Flooding Location feet (NGVD)
-------------------------
Existing Modified
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
North Carolina....................... Marion (City) McDowell Catawba River............................ Approximately 340 feet (or 0.1 mile) downstream of the *1226 *1222
County. U.S. Route 221 bridgex.
Approximately 0.4 mile upstream of the U.S. Route 221 *1234 *1228
Bypass bridge.

Maps available for inspection at the Marion City Hall, 200 North Main Street, Marion, North Carolina.

Send comments to The Honorable A. Everette Clark, Mayor of the City of Marion, P.O. Drawer 700, Marion, North Carolina 28752.

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Tennessee............................ La Vergne (City) Hurricane Creek.......................... Approximately 0.9 mile downstream of U.S. Routes 41 and 70 *517 *510
Rutherford County.
At confluence of East and West Branches Hurricane Creek... *573 *575
West Branch Hurricane Creek.............. Approximately 820 feet downstream of Bridgestone Parkway.. *576 *575
Approximately 200 feet downstream of Heil Quaker Boulevard *586 *585
Rock Spring Branch....................... Approximately 900 feet downstream of Waldron Road......... *656 *654
At Waldron Road........................................... None *660
East Branch Hurricane Creek.............. Approximately 0.18 mile upstream of Bridgestone Parkway... *578 *579
Approximately 0.16 mile upstream of Waldron Road.......... *581 *582
J. Percy Priest Resevoir................. Entire shoreline within community......................... None *506
East Branch Hurricane Creek.............. Approximately 100 feet downstream of Industrial Boulevard. *586 *587

Maps available for inspection at the La Vergne City Hall, 5093 Murfreesboro Road, La Vergne, Tennessee.

Send comments to The Honorable Mike Webb, Mayor of the City of La Vergne, 5093 Murfreesboro Road, La Vergne, Tennessee 37086.

Maps available for inspection at the Murfreesboro City Hall, City Planning Department, 111 West Vine Street, Murfreesboro, Tennesse.

Send comments to The Honorable Joe B. Jackson, Mayor of the City of Murfreesboro, P.O. Box 1139, Murfreesboro, Tennessee 37133-1139.

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Tennessee............................ Rutherford County East Fork Stones River................... Approximately 1.45 miles downstream of U.S. Route 231 *530 *529
(Unincorporated Areas). (Lebanon Pike).
Approximately 0.8 mile upstream of State Route 96......... *565 *561
J. Percy Priest Resevoir................. Entire shoreline within county............................ None *506
Bear Branch.............................. At confluence with East Fork Stones River................. *542 *539
At downstream side of Dejarnette Lane..................... *584 *580
Overall Creek............................ At confluence with West Fork Stones River................. *533 *532
Approximately 4.0 miles upstream of State Route 96........ *632 *634
Lytle Creek.............................. Approximately 500 feet upstream of Sanbyrn Road (at None *601
downstream corporate limits).
Approximately 100 feet downstream of Dilton-Mankin Road... *644 *643
Rock Spring Branch....................... Approximately 1,000 feet downstream of Waldron Road....... *654 *653
Approximately 1,900 feet upstream of Waldron Road......... None *673
Olive Branch............................. At confluence with Stewart Creek.......................... *531 *532

[[Page 29521]]

Approximately 0.45 mile upstream of Rocky Ford Road....... *582 *583
Stewart Creek............................ Approximately 0.5 mile downstream of 8th Avenue........... None *506
Approximately 50 feet upstream of Almaville Road.......... None *603
Lees Spring Branch....................... At confluence with Lytle Creek............................ None *623
Approximately 150 feet upstream of Dilton-Mankin Road..... None *630
Wades Branch............................. At confluence with East Fork Stones River................. *535 *531
Approximately 0.65 mile upstream of State Route 102....... *535 *534
Bradley Creek............................ At confluence with East Fork Stones River................. *564 *559
Approximately 264 feet upstream of Browns Mill Road....... * *
Puckett Creek............................ At confluence with Overall Creek.......................... *570 *572
Approximately 0.12 mile upstream of confluence with *571 *572
Overall Creek.
Bushman Creek............................ At confluence with East Fork Stones River................. *549 *546
Approximately 1,300 feet upstream of New Lascassas Road... *590 *591

Maps available for inspection at the Rutherford County Courthouse, County Engineering Department, #1 Public Square South, Room 101, Murfreesboro, Tennessee.

Send comments to Ms. Nancy Allen, Rutherford County Executive, Rutherford County Courthouse, #1 Public Square South, Room 101, Murfreesboro, Tennessee 37130.

Maps available for inspection at the Smyrna Town Hall, 315 South Lowry Street, Smyrna, Tennessee.

Send comments to The Honorable Paul H. Johns, Mayor of the Town of Smyrna, 315 South Lowry Street, Smyrna, Tennessee 37167.

Maps available for inspection at the Moorefield Town Hall, 206 Winchester Avenue, Moorefield, West Virginia.

Send comments to The Honorable LeMar Sager, Mayor of the Town of Moorefield, 206 Winchester Avenue, Moorefield, West Virginia 26836.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 29522]]

(Catalog of Federal Domestic Assistance No. 83.100, ``Flood
Insurance.'')

Dated: May 31, 1996.
Richard W. Krimm,
Acting Associate Director for Mitigation.
[FR Doc. 96-14727 Filed 6-10-96; 8:45 am]
BILLING CODE 6718-04-P

Complete official Federal Register PDF

FR Doc. 96-14706 Consolidation of Drug Regulations

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29502-29504]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14706]

=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Parts 200, 250, and 310

[Docket No. 96N-0183]
RIN 0910-AA53

Consolidation of Drug Regulations

AGENCY: Food and Drug Administration, HHS.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Food and Drug Administration (FDA) is proposing to 
consolidate a list of drugs, previously determined by rulemaking to be 
new drugs, into one section. This document would also remove the 
sections now providing for these drugs, except for certain information 
in the regulations that FDA considers to be necessary. This action, 
which will make the regulations more concise and efficient, is being 
taken in response to the President's regulatory reinvention initiative 
(REGO).

DATES: Written comments by August 26, 1996. FDA proposes that any final 
rule based on this proposal become effective 2 weeks after its date of 
publication in the Federal Register.

ADDRESSES: Submit written comments to the Dockets Management Branch 
(HFA-305), Food and Drug Administration, 12420 Parklawn Dr., rm. 1-23, 
Rockville, MD 20857.

FOR FURTHER INFORMATION CONTACT: Mary E. Catchings, Food and Drug 
Administration, Center for Drug Evaluation and Research (HFD-7), 7500 
Standish Pl., Rockville, MD 20855, 301-594-2041.
SUPPLEMENTARY INFORMATION:

I. Introduction

    On March 4, 1995, President Clinton issued a memorandum titled 
``Regulatory Reinvention Initiative.'' This memorandum, part of the 
reform of the Federal regulatory system, directed heads of departments 
and agencies to undertake a page-by-page review of their existing 
regulations and to eliminate or modify those that are outdated or 
otherwise in need of reform. FDA has conducted a comprehensive review 
of

[[Page 29503]]

its existing regulations and has identified regulations to eliminate or 
modify. As a result of that review and as part of its response to the 
President's directive, FDA is proposing to amend or remove those parts 
of its drug regulations codified in Parts 200, 250, and 310 (21 CFR 
parts 200, 250, and 310) regarding certain drugs determined by 
rulemaking to be new drugs. FDA is preparing other revisions resulting 
from the page-by-page review for future publication.
    FDA is proposing to revise Sec. 310.502 to consolidate into one 
section a list of drugs that have been determined by previous 
rulemaking procedures to be new drugs within the meaning of section 
201(p) of the Federal Food, Drug, and Cosmetic Act (the act) (21 U.S.C. 
321(p)) for which approved new drug applications under section 505 of 
the act (21 U.S.C. 355) and 21 CFR part 314 are required for marketing. 
The list would include those new drugs now codified in parts 200, 250, 
and 310. As the agency identifies other new drugs as being new drugs 
through its rulemaking procedures, FDA would add such other new drugs 
to the list.
    Revised Sec. 310.502 would list the names of the drugs and would 
not include the existing background information describing the agency's 
basis for determination of new drug status and, for some drugs, 
requirements for marketing. FDA has determined that with the exception 
of certain information in Sec. 310.509 that FDA considers to be 
necessary, the background information no longer needs to be set out in 
the regulations. For some drugs, the information is outdated. For other 
drugs, removal of the existing explanatory text should not present a 
hardship or burden because the information is available from other 
sources. This proposal would make the regulations more concise and 
efficient.

II. Environmental Impact

    The agency has determined under 21 CFR 25.24(a)(8) that this action 
is of a type that does not individually or cumulatively have a 
significant effect on the human environment. Therefore, neither an 
environmental assessment nor an environmental impact statement is 
required.

III. Analysis of Impacts

    FDA has examined the impacts of the proposed rule under Executive 
Order 12866 and the Regulatory Flexibility Act (Pub. L. 96-354). 
Executive Order 12866 directs agencies to assess all costs and benefits 
of available regulatory alternatives and, when regulation is necessary, 
to select regulatory approaches that maximize net benefits (including 
potential economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity). The agency believes that 
this proposed rule is consistent with the regulatory philosophy and 
principles identified in the Executive Order. In addition, the proposed 
rule is not a significant regulatory action as defined by the Executive 
Order and so is not subject to review under the Executive Order.
    The Regulatory Flexibility Act requires agencies to analyze 
regulatory options that would minimize any significant impact of a rule 
on small entities. Because this document merely proposes to consolidate 
existing regulations, the agency certifies that the proposed rule will 
not have a significant impact on a substantial number of small 
entities. Therefore, under the Regulatory Flexibility Act no further 
analysis is required.

IV. Request for Comments

    Interested persons may, on or before August 26, 1996, submit to the 
Dockets Management Branch (address above) written comments regarding 
this proposal. Two copies of any comments are to be submitted, except 
that individuals may submit one copy. Comments are to be identified 
with the docket number found in brackets in the heading of this 
document. Received comments may be seen in the office above between 9 
a.m. and 4 p.m., Monday through Friday.

V. Effective Date

    FDA proposes that any final rule based on this proposal be 
effective 2 weeks after its date of publication in the Federal 
Register.

List of Subjects

21 CFR Part 200

    Drugs, Prescription drugs.

21 CFR Part 250

    Drugs.

21 CFR Part 310

    Administrative practice and procedure, Drugs, Labeling, Medical 
devices, Reporting and recordkeeping requirements.
    Therefore, under the Federal Food, Drug, and Cosmetic Act, the 
Public Health Service Act, and under authority delegated to the 
Commissioner of Food and Drugs, it is proposed that 21 CFR parts 200, 
250, and 310 be amended as follows:

PART 200--GENERAL

    1. The authority citation for 21 CFR part 200 continues to read as 
follows:

    ---Authority: Secs. 201, 301, 501, 502, 503, 505, 506, 507, 508, 
515, 701, 704, 705 of the Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 321, 331, 351, 352, 353, 355, 356, 357, 358, 360e, 371, 374, 
375).

Subpart B  [Removed]

    2. Subpart B, consisting of Secs. 200.30 and 200.31 is removed and 
reserved.

PART 250--SPECIAL REQUIREMENTS FOR SPECIFIC HUMAN DRUGS

    3. The authority citation for 21 CFR part 250 continues to read as 
follows:

    Authority: Secs. 201, 306, 402, 502, 503, 505, 601(a), 602(a) 
and (c), 701, 705(b) of the Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 321, 336, 342, 352, 353, 355, 361(a), 362(a) and (c), 371, 
375(b)).

Sec. 250.10  [Removed]

    4. Section 250.10 Oral prenatal drugs containing fluorides intended 
for human use is removed.

Sec. 250.103  [Removed]

    5. Section 250.103 Thorium dioxide for drug use is removed.

Sec. 250.106  [Removed]

    6. Section 250.106 Cobalt preparations intended for use by man is 
removed.

PART 310--NEW DRUGS

    7. The authority citation for 21 CFR part 310 continues to read as 
follows:

    Authority: Secs. 201, 301, 501, 502, 503, 505, 506, 507, 512-
516, 520, 601(a), 701, 704, 705, 721 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 321, 331, 351, 352, 353, 355, 356, 357, 
360b-360f, 360j, 361(a), 371, 374, 375, 379e); secs. 215, 301, 
302(a), 351, 354-360F of the Public Health Service Act (42 U.S.C. 
216, 241, 242(a), 262, 263b-263n).
    8. Section 310.502 is revised to read as follows:

Sec. 310.502  Certain drugs accorded new drug status through rulemaking 
procedures.

    (a) The drugs listed in this paragraph (a) have been determined by 
rulemaking procedures to be new drugs within the meaning of section 
201(p) of the act. Except as provided in paragraph (b) of this section, 
an approved new drug application under section 505 of the act and part 
314 of this chapter is required for marketing the following drugs:
    (1) Aerosol drug products for human use containing 1,1,1-
trichloroethane.
    (2) Aerosol drug products containing zirconium.

[[Page 29504]]

    (3) Amphetamines (amphetamine, dextroamphetamine, and their salts, 
and levamfetamine and its salts) for human use.
    (4) Camphorated oil drug products.
    (5) Certain halogenated salicylanilides (tribromsalan (TBS, 3,4',5-
tribromosalicylanilide), dibromsalan (DBS, 4', 5-
dibromosalicylanilide), metabromsalan (MBS, 3, 5-
dibromosalicylanilide), and 3,3', 4,5'-tetrachlorosalicylanilide (TC-
SA)) as an ingredient in drug products.
    (6) Chloroform used as an ingredient (active or inactive) in drug 
products.
    (7) Cobalt preparations intended for use by man.
    (8) Intrauterine devices for human use for the purpose of 
contraception that incorporate heavy metals, drugs, or other active 
substances.
    (9) Oral prenatal drugs containing fluorides intended for human 
use.
    (10) Parenteral drug products in plastic containers.
    (11) Sterilization of drugs by irradiation.
    (12) Sweet spirits of nitre drug products.
    (13) Thorium dioxide for drug use.
    (14) Timed release dosage forms.
    (15) Vinyl chloride as an ingredient, including propellant, in 
aerosol drug products.
    (b) Any drug listed in paragraph (a) of this section, when composed 
wholly or partly of any antibiotic drug, must be certified under 
section 507 of the act or exempted from certification under section 507 
of the act for marketing.

Sec. 310.504  [Removed]

    9. Section 310.504 Amphetamines (amphetamine, dextroamphetamine, 
and their salts and levamfetamine and its salts) for human use is 
removed.

Sec. 310.506  [Removed]

    10. Section 310.506 Use of vinyl chloride as an ingredient, 
including propellant, of aerosol drug products is removed.

Sec. 310.507  [Removed]

    11. Section 310.507 Aerosol drug products for human use containing 
1,1,1-trichloroethane is removed.

Sec. 310.508  [Removed]

    12. Section 310.508 Use of certain halogenated salicylanilides as 
an inactive ingredient in drug products is removed.
    13. Section 310.509 is revised to read as follows:

Sec. 310.509  Parenteral drug products in plastic containers.

    (a) Any parenteral drug product packaged in a plastic immediate 
container is not generally recognized as safe and effective, is a new 
drug within the meaning of section 201(p) of the act, and requires an 
approved new drug application as a condition for marketing. An 
``Investigational New Drug Application'' set forth in part 312 of this 
chapter is required for clinical investigations designed to obtain 
evidence of safety and effectiveness.
    (b) As used in this section, the term ``large volume parenteral 
drug product'' means a terminally sterilized aqueous drug product 
packaged in a single-dose container with a capacity of 100 milliliters 
or more and intended to be administered or used intravenously in a 
human.
    (c) Until the results of compatibility studies are evaluated, a 
large volume parenteral drug product for intravenous use in humans that 
is packaged in a plastic immediate container on or after April 16, 
1979, is misbranded unless its labeling contains a warning that 
includes the following information:
    (1) A statement that additives may be incompatible.
    (2) A statement that, if additive drugs are introduced into the 
parenteral system, aseptic techniques should be used and the solution 
should be thoroughly mixed.
    (3) A statement that a solution containing an additive drug should 
not be stored.
    (d) This section does not apply to a biological product licensed 
under the Public Health Service Act of July 1, 1944 (42 U.S.C. 201).

Sec. 310.510  [Removed]

    14. Section 310.510 Use of aerosol drug products containing 
zirconium is removed.

Sec. 310.513  [Removed]

    15. Section 310.513 Chloroform, use as an ingredient (active or 
inactive) in drug products is removed.

Sec. 310.525  [Removed]

    16. Section 310.525 Sweet spirits of nitre drug products is 
removed.

Sec. 310.526  [Removed]

    17. Section 310.526 Camphorated oil drug products is removed.

    Dated: June 5, 1996.
William B. Schultz,
Deputy Commissioner for Policy.
[FR Doc. 96-14706 Filed 6-6-96; 11:50 am]
BILLING CODE 4160-01-F

Complete official Federal Register PDF

FR Doc. 96-14694 Airworthiness Directives: Pilatus Aircraft Ltd., Model PC-6 Airplanes

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29500-29502]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14694]

-----------------------------------------------------------------------

[[Page 29501]]

DEPARTMENT OF TRANSPORTATION
14 CFR Part 39

[Docket No. 95-CE-85-AD]
RIN 2120-AA64

Airworthiness Directives: Pilatus Aircraft Ltd., Model PC-6 
Airplanes

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of proposed rulemaking (NPRM).

-----------------------------------------------------------------------

SUMMARY: This document proposes to adopt a new airworthiness directive 
(AD) that would apply to Pilatus Aircraft Ltd. (Pilatus) Model PC-6 
airplanes. The proposed action would require inspecting for loose or 
sheared rivets in the hinge brackets on the horizontal stabilizer and 
inspecting for incorrect spacing tolerance of the hinge brackets. If 
the rivets are found loose or sheared, the proposed AD would require 
replacing the rivets and also re-positioning the hinge brackets, if 
found incorrectly spaced. Several reports of rivets shearing on the 
hinge brackets prompted the proposed action. The actions specified in 
this proposed AD are intended to prevent structural failure of the 
hinge bracket on the horizontal stabilizer, which could result in 
partial or complete loss of control of the horizontal stabilizer and 
loss of control of the airplane.

DATES: Comments must be received on or before August 14, 1996.

ADDRESSES: Submit comments in triplicate to the Federal Aviation 
Administration (FAA), Central Region, Office of the Assistant Chief 
Counsel, Attention: Rules Docket No. 95-CE-85-AD, Room 1558, 601 E. 
12th Street, Kansas City, Missouri 64106. Comments may be inspected at 
this location between 8 a.m. and 4 p.m., Monday through Friday, 
holidays excepted.
    Service information that applies to the proposed AD may be obtained 
from Pilatus Aircraft Ltd., CH-6370 Stans, Switzerland. This 
information also may be examined at the Rules Docket at the address 
above.

FOR FURTHER INFORMATION CONTACT: Mr. Roman T. Gabrys, Project Officer, 
Small Airplane Directorate, Aircraft Certification Service, FAA, 1201 
Walnut, suite 900, Kansas City, Missouri 64106; telephone (816) 426-
6932; facsimile (816) 426-2169.

SUPPLEMENTARY INFORMATION:

Comments Invited

    Interested persons are invited to participate in the making of the 
proposed rule by submitting such written data, views, or arguments as 
they may desire. Communications should identify the Rules Docket number 
and be submitted in triplicate to the address specified above. All 
communications received on or before the closing date for comments, 
specified above, will be considered before taking action on the 
proposed rule. The proposals contained in this notice may be changed in 
light of the comments received.
    Comments are specifically invited on the overall regulatory, 
economic, environmental, and energy aspects of the proposed rule. All 
comments submitted will be available, both before and after the closing 
date for comments, in the Rules Docket for examination by interested 
persons. A report that summarizes each FAA-public contact concerned 
with the substance of this proposal will be filed in the Rules Docket.
    Commenters wishing the FAA to acknowledge receipt of their comments 
submitted in response to this notice must submit a self-addressed, 
stamped postcard on which the following statement is made: ``Comments 
to Docket No. 95-CE-85-AD.'' The postcard will be date stamped and 
returned to the commenter.

Availability of NPRMs

    Any person may obtain a copy of this NPRM by submitting a request 
to the FAA, Central Region, Office of the Assistant Chief Counsel, 
Attention: Rules Docket No. 95-CE-85-AD, Room 1558, 601 E. 12th Street, 
Kansas City, Missouri 64106.

Discussion

    The Federal Office for Civil Aviation (FOCA), which is the 
airworthiness authority for Switzerland, recently notified the FAA that 
an unsafe condition may exist on certain Pilatus Model PC-6 airplanes. 
The FOCA has received several reports of sheared or loose rivets in the 
hinge bracket that attaches the horizontal stabilizer to the fuselage. 
Investigation reveals that pre-loads in the hinge bracket flanges may 
exist due to tightness of the fit of the spacer, or in certain 
instances, the hinge bracket is not positioned or spaced correctly. 
This condition can substantially affect the load carrying capability of 
these brackets, thus causing the rivets to shear or loosen, which could 
lead to structural failure of the horizontal stabilizer.
    Pilatus Aircraft Ltd. has issued service bulletin (SB) PC-6 165, 
dated February 7, 1994, which specifies procedures for inspecting for 
sheared or loose rivets, replacing any sheared or loose rivets with new 
rivets, and checking the spacing tolerance of the hinge brackets.
    FOCA classified this service bulletin as mandatory and has issued 
airworthiness directive (AD) HB 94-086, dated June 4, 1994, in order to 
ensure the continued airworthiness of these airplanes in Switzerland.
    This airplane model is manufactured in Switzerland and is type 
certificated for operation in the United States under the provisions of 
Sec. 21.29 of the Federal Aviation Regulations (14 CFR 21.29) and the 
applicable bilateral airworthiness agreement between Switzerland and 
the United States. Pursuant to this bilateral airworthiness agreement, 
the Switzerland FOCA has kept the FAA informed of the situation 
described above. The FAA has examined the findings of the Switzerland 
FOCA, reviewed all available information, and determined that AD action 
is necessary for products of this type design that are certificated for 
operation in the United States.
    After examining the circumstances and reviewing all available 
information related to the incidents described above, the FAA has 
determined that AD action should be taken to prevent a reduction in the 
structural integrity of the hinge bracket and tailplane, which could 
result in partial or complete loss of control of the horizontal 
stabilizer and loss of control of the airplane.
    Since an unsafe condition has been identified that is likely to 
exist or develop in other Pilatus Model PC-6 airplanes of the same type 
design registered in the United States, the proposed AD would require 
the following:

--Inspecting the hinge brackets attached to the fuselage for loose or 
sheared rivets,
--Inspecting the hinge brackets for correct spacing tolerance and 
positioning,
--Removing the brackets and adjusting any incorrect spacing or 
positioning, and
--Replacing any loose or sheared rivets with new rivets.

    The FAA estimates that one airplane in the U.S. registry would be 
affected by the proposed AD, that it would take less than 1 workhour 
per airplane to accomplish the proposed actions, and that the average 
labor rate is approximately $60 an hour. Based on these figures, the 
total cost impact of the proposed AD for the only U.S. operator is 
estimated to be $60. This is the cost of the inspection only and does 
not include the cost for replacing any loose rivets, if found. This 
figure is based on the assumption that the affected owner/

[[Page 29502]]

operator of the affected airplane has not performed the inspection or 
modification.
    The regulations proposed herein would not have substantial direct 
effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government. Therefore, in 
accordance with Executive Order 12612, it is determined that this 
proposal would not have sufficient federalism implications to warrant 
the preparation of a Federalism Assessment.
    For the reasons discussed above, I certify that this action (1) is 
not a ``significant regulatory action'' under Executive Order 12866; 
(2) is not a ``significant rule'' under DOT Regulatory Policies and 
Procedures (44 FR 11034, February 26, 1979); and (3) if promulgated, 
will not have a significant economic impact, positive or negative, on a 
substantial number of small entities under the criteria of the 
Regulatory Flexibility Act. A copy of the draft regulatory evaluation 
prepared for this action has been placed in the Rules Docket. A copy of 
it may be obtained by contacting the Rules Docket at the location 
provided under the caption ADDRESSES.

List of Subjects in 14 CFR Part 39

    Air transportation, Aircraft, Aviation safety, Safety.

The Proposed Amendment

    Accordingly, pursuant to the authority delegated to me by the 
Administrator, the Federal Aviation Administration proposes to amend 
part 39 of the Federal Aviation Regulations (14 CFR part 39) as 
follows:

PART 39--AIRWORTHINESS DIRECTIVES

    1. The authority citation for part 39 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40113, 44701.

Sec. 39.13  [Amended]

    2. Section 39.13 is amended by adding a new airworthiness directive 
(AD) to read as follows:

Pilatus Aircraft Ltd.: Docket No. 95-CE-85-AD.

    Applicability: Model PC-6 Airplanes (serial numbers 825 through 
892).

    Note 1:  This AD applies to each airplane identified in the 
preceding applicability provision, regardless of whether it has been 
modified, altered, or repaired in the area subject to the 
requirements of this AD. For airplanes that have been modified, 
altered, or repaired so that the performance of the requirements of 
this AD is affected, the owner/operator must request approval for an 
alternative method of compliance in accordance with paragraph (e) of 
this AD. The request should include an assessment of the effect of 
the modification, alteration, or repair on the unsafe condition 
addressed by this AD; and, if the unsafe condition has not been 
eliminated, the request should include specific proposed actions to 
address it.

    Compliance: Required within the next 75 hours time-in-service 
(TIS), after the effective date of this AD, unless already 
accomplished.

    Note 2: The compliance time required in this AD takes precedence 
over the compliance time in Pilatus Service Bulletin PC-6 165, dated 
February 7, 1994.

    To prevent structural failure of the hinge bracket on the 
horizontal stabilizer, which could result in partial or complete 
loss of control of the horizontal stabilizer and loss of control of 
the airplane, accomplish the following:
    (a) Inspect the hinge brackets on the horizontal stabilizer for 
sheared or loose rivets in accordance with paragraph 2.A. in the 
ACCOMPLISHMENT INSTRUCTIONS section of Pilatus Service Bulletin (SB) 
PC-6 165, dated February 7, 1994.
    (b) Inspect the spacing tolerance of the hinge bracket in 
accordance with paragraph 2.C. in the ACCOMPLISHMENT INSTRUCTIONS 
section of Pilatus SB PC-6 165, dated February 7, 1994.
    (c) If there are loose or sheared rivets or if the bracket 
spacing is out of the spacing tolerance, prior to further flight, 
modify the position and space tolerance of the hinge brackets and 
replace any loose or sheared rivets in accordance with paragraph 
2.D. in the ACCOMPLISHMENT INSTRUCTIONS section of Pilatus SB PC-6 
165, dated February 7, 1994.
    (d) Special flight permits may be issued in accordance with 
sections 21.197 and 21.199 of the Federal Aviations Regulations (14 
CFR 21.197 and 21.199) to operate the airplane to a location where 
the requirements of this AD can be accomplished.
    (e) An alternative method of compliance or adjustment of the 
compliance time that provides an equivalent level of safety may be 
approved by the Manager, Small Airplane Directorate. The request 
shall be forwarded through an appropriate FAA Maintenance Inspector, 
who may add comments and then send it to the Manager, Small Airplane 
Directorate.

    Note 3: Information concerning the existence of approved 
alternative methods of compliance with this AD, if any, may be 
obtained from the Small Airplane Directorate.

    (f) All persons affected by this directive may obtain copies of 
the document referred to herein upon request to Pilatus Aircraft 
Ltd., CH-6370 Stans, Switzerland; or may examine this document at 
the FAA, Central Region, Office of the Assistant Chief Counsel, Room 
1558, 601 E. 12th Street, Kansas City, Missouri.
    Issued in Kansas City, Missouri on June 4, 1996.
Henry A. Armstrong,
Acting Manager, Small Airplane Directorate, Aircraft Certification 
Service.
[FR Doc. 96-14694 Filed 6-10-96; 8:45 am]
BILLING CODE 4910-13-U

Complete official Federal Register PDF

FR Doc. 96-14693 Airworthiness Directives; AlliedSignal Inc., VN-411B VHF Navigation Receiver

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29499-29500]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14693]

========================================================================
Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

========================================================================

Federal Register / Vol. 61, No. 113 / Tuesday, June 11, 1996 / 
Proposed Rules

[[Page 29499]]

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. 95-CE-91-AD]
RIN 2120--AA64

Airworthiness Directives; AlliedSignal Inc., VN-411B VHF 
Navigation Receiver

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of proposed rulemaking (NPRM).

-----------------------------------------------------------------------

SUMMARY: This document proposes to adopt a new airworthiness directive 
(AD) that would apply to certain AlliedSignal Inc. VN-411B VHF 
Navigation Receivers without Modification 20 that are installed on but 
not limited to Learjet Model 31A, Fokker Model F27-50, and British 
Aerospace Model ATP airplanes. The proposed action would require 
removing and replacing the navigation receivers that do not have 
Modification 20 installed. A report of navigation receiver interference 
during a landing operation prompted the proposed action. The actions 
specified by the proposed AD are intended to prevent VHF navigation 
receiver interference from FM radio station broadcasts which could 
cause distortion of the navigation audio and deflection of the desired 
flight path of the airplane during landing operations, possibly 
resulting in loss of the airplane.

DATES: Comments must be received on or before August 14, 1996.

ADDRESSES: Submit comments in triplicate to the Federal Aviation 
Administration (FAA), Central Region, Office of the Assistant Chief 
Counsel, Attention: Rules Docket No. 95-CE-91-AD, Room 1558, 601 E. 
12th Street, Kansas City, Missouri 64106. Comments may be inspected at 
this location between 8 a.m. and 4 p.m., Monday through Friday, 
holidays excepted. -
    Service information that applies to the proposed AD may be obtained 
from AlliedSignal, General Aviation Avionics, 400 North Rogers Road, 
Olathe, Kansas 66062-1212. This information also may be examined at the 
Rules Docket at the address above.

FOR FURTHER INFORMATION CONTACT: Roger Souter, Aerospace Engineer, FAA, 
Wichita Aircraft Certification Office, 1801 Airport Road, Room 100, 
Mid-Continent Airport, Wichita, Kansas 67209; telephone (316) 946-4134, 
facsimile (316) 946-4407.

SUPPLEMENTARY INFORMATION:

Comments Invited -

    Interested persons are invited to participate in the making of the 
proposed rule by submitting such written data, views, or arguments as 
they may desire. Communications should identify the Rules Docket number 
and be submitted in triplicate to the address specified above. All 
communications received on or before the closing date for comments, 
specified above, will be considered before taking action on the 
proposed rule. The proposals contained in this notice may be changed in 
light of the comments received. -
    Comments are specifically invited on the overall regulatory, 
economic, environmental, and energy aspects of the proposed rule. All 
comments submitted will be available, both before and after the closing 
date for comments, in the Rules Docket for examination by interested 
persons. A report that summarizes each FAA-public contact concerned 
with the substance of this proposal will be filed in the Rules Docket. 
-
    Commenters wishing the FAA to acknowledge receipt of their comments 
submitted in response to this notice must submit a self-addressed, 
stamped postcard on which the following statement is made: ``Comments 
to Docket No. 95-CE-91-AD.'' The postcard will be date stamped and 
returned to the commenter.

Availability of NPRMs -

    Any person may obtain a copy of this NPRM by submitting a request 
to the FAA, Central Region, Office of the Assistant Chief Counsel, 
Attention: Rules Docket No. 95-CE-91-AD, Room 1558, 601 E. 12th Street, 
Kansas City, Missouri 64106.

Discussion -

    The FAA has received a report of navigation receiver interference 
aboard an airplane equipped with an AlliedSignal VN-411B VHF Navigation 
Receiver from a nearby FM radio station broadcast while operating on 
the runway localizer course. The interference was manifested by the 
display of misleading localizer information on the cockpit display 
systems. Further investigation revealed that the source of the problem 
was interference between the localizer receiver local oscillator, the 
glide slope receiver voltage controlled oscillator (VCO), and the FM 
broadcast signal. These navigation receivers, although conforming to 
the requirements for FM interference immunity, are susceptible to FM 
broadcast interference when tuned to erroneous VHF localizer 
frequencies, resulting in misleading localizer signal outputs. Although 
this occurrence implies that a 3.0 Mhz split between the localizer 
frequency and the FM station frequency could cause this problem, the 
manufacturer states that preliminary testing has shown that only 
multiple combinations of these signal sources can result in erroneous 
localizer operation.-
    AlliedSignal, Inc. has issued Bendix/King service bulletin (SB) VN 
411B-20, dated January 1996, which specifies modifying the navigation 
receiver and completing a test for FM frequency immunity. -
    After examining the circumstances and reviewing all available 
information related to the incident described above, the FAA has 
determined that AD action should be taken to prevent VHF navigation 
receiver interference from FM radio station broadcasts which could 
result in distortion of the navigation audio and deflection of the 
desired flight path of the airplane during landing operations. -
    Since an unsafe condition has been identified that is likely to 
exist or develop in other AlliedSignal Inc. VN-411B VHF navigation 
receivers of the same type design, the proposed AD would require 
removing any VHF navigation receiver that does not have Modification 20 
installed and replacing the receiver with one that has Modification 20 
installed by an AlliedSignal Bendix/King owned service center. -

[[Page 29500]]

    The FAA estimates that 19 receivers in the U.S. registry would be 
affected by the proposed AD, that it would take approximately 2 
workhours per receiver to accomplish the proposed action, and that the 
average labor rate is approximately $60 an hour. The manufacturer is 
not charging the owner/operator for exchanging the navigation receiver 
unit and is allowing 2 workhours of labor to be claimed by the owners/
operators to accomplish the proposed action. Based on these figures, 
there is no cost impact of the proposed AD on U.S. operators. The FAA 
has no way of determining if any of the affected airplanes have the 
navigation receiver with Modification 20 installed. -
    The compliance time of this AD is presented in calendar time 
instead of hours time-in-service (TIS). The FAA has determined that a 
calendar time compliance is the most desirable method because of the 
wide range of fleet usage. Therefore, to ensure that the above-
referenced condition is detected and corrected on all airplanes within 
a reasonable period of time without inadvertently grounding any 
airplanes, a compliance schedule based upon calendar time instead of 
hours TIS is required. -
    The regulations proposed herein would not have substantial direct 
effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government. Therefore, in 
accordance with Executive Order 12612, it is determined that this 
proposal would not have sufficient federalism implications to warrant 
the preparation of a Federalism Assessment. -
    For the reasons discussed above, I certify that this action (1) is 
not a ``significant regulatory action'' under Executive Order 12866; 
(2) is not a ``significant rule'' under DOT Regulatory Policies and 
Procedures (44 FR 11034, February 26, 1979); and (3) if promulgated, 
will not have a significant economic impact, positive or negative, on a 
substantial number of small entities under the Regulatory Flexibility 
Act. A copy of the draft regulatory evaluation prepared for this action 
has been placed in the Rules Docket. A copy of it may be obtained by 
contacting the Rules Docket at the location provided under the caption 
ADDRESSES.

List of Subjects in 14 CFR Part 39 -

    Air transportation, Aircraft, Aviation safety, Safety.

The Proposed Amendment -

    Accordingly, pursuant to the authority delegated to me by the 
Administrator, the Federal Aviation Administration proposes to amend 
part 39 of the Federal Aviation Regulations (14 CFR part 39) as 
follows:

PART 39--AIRWORTHINESS DIRECTIVES

    1. The authority citation for part 39 continues to read as follows:

    Authority:` 49 USC 106(g), 40113, 44701.

Sec. 39.13  [Amended]

    2. Section 39.13 is amended by adding a new airworthiness directive 
(AD) to read as follows:

AlliedSignal Inc.: Docket No. 95-CE-91-AD.

    Applicability: VHF Navigation Receivers with the following 
model, part numbers, computer software, and modifications that do 
not have Modification 20 installed on but not limited to Learjet 
Model 31A, Fokker Model F27-50, and British Aerospace Model ATP 
airplanes, certificated in any category.

------------------------------------------------------------------------
                                                Software                
             Model               King part No.     ID      Modification 
------------------------------------------------------------------------
VN-411B.......................     066-1101-00        06  18 and 19.    
VN-411B.......................     066-1101-31        00  00 and 19.    
VN-411B.......................     066-1101-40        00  00 and 19.    
VN-411B.......................     066-1101-50        00  00 and 19.    
------------------------------------------------------------------------

    Note 1: This AD applies to each airplane identified in the 
preceding applicability provision, regardless of whether it has been 
modified, altered, or repaired in the area subject to the 
requirements of this AD. For airplanes that have been modified, 
altered, or repaired so that the performance of the requirements of 
this AD is affected, the owner/operator must request approval for an 
alternative method of compliance in accordance with paragraph (d) of 
this AD. The request should include an assessment of the effect of 
the modification, alteration, or repair on the unsafe condition 
addressed by this AD; and, if the unsafe condition has not been 
eliminated, the request should include specific proposed actions to 
address it.

    Compliance: Requried within the next 90 calendar days after the 
effective date of this AD or upon replacement or repair of any 
affected AlliedSignal VHF Navigation Receiver, whichever occurs 
first, unless already accomplished.
    To prevent VHF navigation receiver interference from FM radio 
station broadcast frequencies, which could cause distortion of the 
navigation audio and deflection of the desired flight path of the 
airplane during landing operations, possibly resulting in loss of 
the airplane, accomplish the following:
    (a) Remove any navigation receiver that does not have 
Modification 20 installed and return the unit to an AlliedSignal 
Bendix/King service center in accordance with AlliedSignal Bendix/
King Service Bulletin (SB) VN 411B-20, dated January 1996.
    (b) Replace the navigation receiver with one that has 
Modification 20 installed by an AlliedSignal Bendix/King service 
center in accordance with AlliedSignal Bendix/King SB VN 411B-20, 
dated January 1996.
    (c) Special flight permits may be issued in accordance with 
sections 21.197 and 21.199 of the Federal Aviation Regulations (14 
CFR 21.197 and 21.199) to operate the airplane to a location where 
the requirements of this AD can be accomplished.
    (d) An Alternative method of compliance or adjustment of the 
compliance time that provides an equivalent level of safety may be 
approved by the Manager, Wichita Aircraft Certification Office, 1801 
Airport Road, Room 100, Mid-Continent Airport, Wichita, Kansas 
67209. The request shall be forwarded through an appropriate FAA 
Maintenance Inspector, who may add comments and then send it to the 
Manager, Wichita Aircraft Certification Office.

    Note 2: Information concerning the existence of approved 
alternative methods of compliance with this AD, if any, may be 
obtained from the Wichita Aircraft Certification Office.

    (e) All persons affected by this directive may obtain copies of 
the document referred to herein upon request to AlliedSignal, 
General Aviation Avionics, 400 North Rogers Road, Olathe, Kansas 
66062-1212; or may examine this document at the FAA, Central Region, 
Office of the Assistant Chief Counsel, Room 1558, 601 E. 12th 
Street, Kansas City, Missouri 64106.

    Issued in Kansas City, Missouri, on June 4, 1996.
Henry A. Armstrong,
Acting Manager, Small Airplane Directorate, Aircraft Certification 
Service.
[FR Doc. 96-14693 Filed 6-10-96; 8:45 am]
BILLING CODE 4910-13-P

Complete official Federal Register PDF

FR Doc. 96-14679 Approval and Promulgation of Maintenance Plan and Designation of Areas for Air Quality Planning Purposes for Carbon Monoxide; State of Washington

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29515-29518]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14679]

-----------------------------------------------------------------------

ENVIRONMENTAL PROTECTION AGENCY
40 CFR Parts 52 and 81

[WA52-7125; FRL-5513-2]

Approval and Promulgation of Maintenance Plan and Designation of
Areas for Air Quality Planning Purposes for Carbon Monoxide; State of
Washington

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Environmental Protection Agency (EPA) is announcing its
intent to redesignate the Seattle-Tacoma-Everett nonattainment area to
attainment for the carbon monoxide (CO) air quality standard and to
approve a maintenance plan that will insure that the area remains in
attainment. Under the Clean Air Act as amended in 1990 (CAA),
designations can be revised if sufficient data is available to warrant
such revisions. In this action, EPA is proposing to approve the
Seattle-Tacoma-Everett redesignation as meeting the requirements set
forth in the CAA.

DATES: Comments must be postmarked on or before July 11, 1996.

ADDRESSES: Written comments should be addressed to: Montel Livingston,
SIP Manager, EPA, Office of Air Quality (OAQ-107), 1200 Sixth Avenue,
Seattle, Washington 98101.
Copies of the State's redesignation request and other information
supporting this proposed action are available for public review during
normal business hours at the addresses listed below: EPA, Alaska-
Washington Unit (OAQ-107), 1200 Sixth Avenue, Seattle, Washington
98101, and the Washington State Department of Ecology, Air Quality
Program, P.O. Box 47600, Olympia, Washington 98504-7600.

FOR FURTHER INFORMATION CONTACT: Christi Lee, EPA Region 10 Washington
Operation's Office, at (360) 753-9079.

SUPPLEMENTARY INFORMATION:

I. Background

In a March 15, 1991, letter to the EPA Region 10 Administrator, the
Governor of Washington recommended the Seattle-Tacoma-Everett area,
including the western portions of King, Pierce, and Snohomish Counties,
be designated as nonattainment for CO as required by section
107(d)(1)(A) of the 1990 Clean Air Act Amendments (CAA) (Public Law
101-549, 104 Stat. 2399, codified at 42 U.S.C. 7401-7671q). The area,
which includes lands within the Puyallup Reservation, Tulalip
Reservation and Muckleshoot Reservation, was designated nonattainment
and classified as ``moderate'' under the provisions outlined in
sections 186 and 187 of the CAA. (See 56 FR 56694 (Nov. 6, 1991),
codified at 40 CFR part 81, Sec. 81.348.) Because the Seattle-Tacoma-
Everett area had a design value of 14.8 ppm (based on 1987 data), it
was classified as ``moderate > 12.7 ppm'' (moderate plus).
The CAA established an attainment date of December 31, 1995, for
all moderate CO areas. The Seattle-Tacoma-Everett area has ambient
monitoring data showing attainment of the CO National Ambient Air
Quality Standards (NAAQS), since 1991. Therefore, in an effort to
comply with the CAA and to ensure continued attainment of the NAAQS, on
March 6, 1996, the Washington State Department of Ecology (WDOE)
submitted a CO redesignation request and a maintenance plan for the
Seattle-Tacoma-Everett nonattainment area. The WDOE submitted evidence
that public hearings were held on October 26, 1995 in Seattle at the
office of the Puget Sound Air Pollution Control Agency.
On April 8, 1996, EPA Region 10 determined that the information
received from the WDOE constituted a complete redesignation request
under the general completeness criteria of 40 CFR part 51, appendix V,
Secs. 2.1 and 2.2.

II. Evaluation Criteria

Section 107(d)(3)(E) of the CAA lists specific requirements that an
area must meet in order to be redesignated from nonattainment to
attainment. They are:

1. The area must have attained the applicable NAAQS;
2. The area must have a fully approved SIP under section 110(k) of the
CAA and the area must have met all relevant requirements under section
110 and Part D of the CAA.
3. The air quality improvement must be permanent and enforceable;
4. The area must have a fully approved maintenance plan pursuant to
section 175A of the CAA.

III. Review of State Submittal

EPA proposes to find that the Washington redesignation request for
the Seattle-Tacoma-Everett area meets the requirements of section
107(d)(3)(E), noted above. EPA also proposes to find that information
and requirements provided in the WDOE redesignation request and
maintenance plan for the Seattle-Tacoma-Everett nonattainment area
demonstrate that the 107(d)(3)(E) requirements have been met for the
affected tribal lands which include portions of the Tulalip
Reservation, the Puyallup Reservation and the Muckleshoot Reservation.
The Agency has not determined whether it is bound to follow the formal
requirements of section 107(d)(3)(E) when taking such redesignation
actions for tribal lands. The action to redesignate to attainment these
tribal lands is being proposed today without answering that question
because information submitted by WDOE satisfies each required element
for redesignation.
The following is a brief description of how each of the
107(d)(3)(E) requirements are met. A Technical Support Document, on
file at the EPA Region 10 office, contains a more detailed analysis of
this redesignation proposal.

1. Attainment of the CO NAAQS

To attain the CO NAAQS, an area must have complete quality-assured
data showing no more than one exceedance of the standard per year over
at least two consecutive years. The redesignation is based on air
quality data that showed that the CO standard was not violated in 1993
and 1994. These data were collected by WDOE in accordance with 40 CFR
50.8, following EPA guidance on quality assurance and quality control
and are in the EPA Aerometric Information and Retrieval System (AIRS).
Since the Seattle-Tacoma-Everett area has complete quality-assured
monitoring data showing attainment of the standard over two consecutive
years (1993 and 1994), and has not violated the standard since that
time, the area has met the first statutory criterion for attainment of
the CO NAAQS. The WDOE has committed to continue monitoring in this
area in accordance with 40 CFR part 58.

[[Page 29516]]

2. Fully Approved SIP That Meets Applicable Requirements of Section 110
and Part D of the CAA

Section 107(d)(3)(E)(ii) of the CAA states that EPA may not approve
redesignation of a nonattainment area to attainment unless EPA has
fully approved all of the SIP requirements that were due under the 1990
CAA. The 1990 CAA required that nonattainment areas achieve specific
new requirements depending on the severity of the nonattainment
classification. As noted earlier, Seattle-Tacoma-Everett was classified
as a moderate CO nonattainment area with a design value greater than
12.7 ppm. Therefore, the 1990 CAA requirements for the Seattle-Tacoma-
Everett nonattainment area include the preparation of a 1990 emission
inventory with periodic updates, adoption of an oxygenated fuels
program, the development of contingency measures, adoption of an
enhanced inspection and maintenance program, a forecast of vehicle
miles traveled, development of conformity procedures, and the
establishment of a permit program for new or modified major stationary
sources.
For the purposes of evaluating the request for redesignation to
attainment, EPA has approved all but three elements of the WDOE CO SIP.
Specifically, the three elements of the WDOE CO SIP that have not been
fully approved by EPA are the 1990 base year emission inventory, the
inspection and maintenance program and the attainment demonstration.
EPA is reviewing the SIP revisions for each of these three
requirements, which have been submitted by the WDOE. Final approval of
the Seattle-Tacoma-Everett CO area redesignation request is contingent
on final action by EPA to approve these three elements.
A. Conformity
Under section 176(c) of the CAA, states were required to submit
revisions to their SIPs that include criteria and procedures to ensure
that Federal actions conform to the air quality planning goals in the
applicable SIPs. The requirement to determine conformity applies to
transportation plans, programs and projects developed, funded or
approved under Title 23 U.S.C. or the Federal Transit Act
(``transportation conformity''), as well as all other Federal actions
(``general conformity''). Congress provided for the State revisions to
be submitted one year after the date of promulgation of final EPA
conformity regulations. EPA promulgated final transportation conformity
regulations on November 24, 1993 (58 FR 62188) and final general
conformity regulations on November 30, 1993 (58 FR 63214). These
conformity rules require that the States adopt both transportation and
general conformity provisions in the SIP for areas designated
nonattainment or subject to a maintenance plan approved under CAA
section 175A. Pursuant to 40 CFR Sec. 51.396 of the transportation
conformity rule, the WDOE was required to submit a SIP revision
containing transportation conformity criteria and procedures consistent
with those established in the Federal rule by November 25, 1994.
Similarly, pursuant to 40 CFR Sec. 51.851 of the general conformity
rule, the WDOE was required to submit a SIP revision containing general
conformity criteria and procedures consistent with those established in
the Federal rule by December 1, 1994. The WDOE submitted its
transportation conformity SIP revision to EPA on December 1, 1995. This
SIP has not been fully approved by EPA. The WDOE has not submitted its
general conformity SIP revision.
Although this redesignation request was submitted to EPA after the
due dates for the SIP revisions for transportation conformity (58 FR
62188) and general conformity (58 FR 63214) rules, EPA believes it is
reasonable to interpret the conformity requirements as not being
applicable requirements for purposes of evaluating the redesignation
request under section 107(d). The rationale for this is based on a
combination of two factors. First, the requirement to submit SIP
revisions to comply with the conformity provisions of the Act continues
to apply to areas after redesignation to attainment. Therefore, the
State remains obligated to adopt the transportation and general
conformity rules even after redesignation and would risk sanctions for
failure to do so. While redesignation of an area to attainment enables
the area to avoid further compliance with most requirements of section
110 and part D, since those requirements are linked to the
nonattainment status of an area, the conformity requirements apply to
both nonattainment and maintenance areas. Second, the federal
conformity rules require the performance of conformity analyses in the
absence of state-adopted rules. Therefore, a delay in adopting State
rules does not relieve an area from the obligation to implement
conformity requirements.
Because areas are subject to the conformity requirements regardless
of whether they are redesignated to attainment, and must implement
conformity under Federal rules if State rules are not yet adopted, EPA
believes it is reasonable to view these requirements as not being
applicable requirements for purposes of evaluating a redesignation
request.
Therefore, EPA has modified its national policy regarding the
interpretation of the provisions of section 107(d)(3)(E) concerning the
applicable requirements for purposes of reviewing a carbon monoxide
redesignation request. (See 61 FR 2918, January 30, 1996). Under this
policy, for the reasons just discussed, EPA believes that the CO
redesignation request for the Seattle-Tacoma-Everett area may be
approved notwithstanding the lack of submitted and approved state
transportation and general conformity rules.
B. Periodic Emission Inventory
Under Part D of the CAA a 1993 CO periodic emission inventory is
required to be submitted to EPA for approval into the Washington SIP.
Ecology submitted a 1993 emission inventory as an element of the
maintenance plan for purposes of meeting the attainment emission
inventory requirement of section 175A. EPA is accepting and proposing
to approve the 1993 emission inventory as satisfying both the Part D
and section 175A requirements.

3. Improvement in Air Quality Due to Permanent and Enforceable Measures

EPA approved the WDOE's CO SIP under the 1990 CAA. Emission
reductions achieved through the implementation of control measures
contained in that SIP are enforceable. These measures were: an enhanced
inspection and maintenance program, the Federal Motor Vehicle Control
Program, and an oxygenated fuels program. As discussed above, the
Seattle-Tacoma-Everett area initially attained the NAAQS in 1991 (prior
to implementation of the oxygenated fuels program) with monitored
attainment through the 1995-1996 CO season. This indicates that the
improvements are due to the permanent and enforceable measures
contained in the 1990 CO SIP and did not rely on the oxygenated fuels
program.
The WDOE has demonstrated that actual enforceable emission
reductions are responsible for the air quality improvement and that the
CO emissions in the base year are not artificially low due to local
economic downturn or unusual or extreme occurrences in the weather
patterns. EPA finds that the combination of certain existing EPA-
approved SIP and federal measures contribute to the permanence and
enforceability of reduction in ambient

[[Page 29517]]

CO levels that have allowed the area to attain the NAAQS.

4. Fully Approved Maintenance Plan Under Section 175A

Section 175A of the CAA sets forth the elements of a maintenance
plan for areas seeking redesignation from nonattainment to attainment.
The plan must demonstrate continued attainment of the applicable NAAQS
for at least ten years after the Administrator approves a redesignation
to attainment. Eight years after the redesignation, the state must
submit a revised maintenance plan which demonstrates attainment for the
ten years following the initial ten-year period. To provide for the
possibility of future NAAQS violations, the maintenance plan must
contain contingency measures, with a schedule for implementation
adequate to assure prompt correction of any air quality problems. In
this notice, EPA is proposing to approve the WDOE's maintenance plan
for the Seattle-Tacoma-Everett area because EPA finds that it meets the
requirements of section 175A.
A. Attainment Emission Inventory
The WDOE submitted comprehensive inventories of CO emissions from
point, area, stationary and mobile sources using 1993 as the attainment
year for calculations to demonstrate that the CO standard will be
maintained in the Seattle-Tacoma-Everett area. Since air monitoring
recorded attainment in 1993, 1993 is an acceptable year for the
attainment inventory. The 1993 emission inventory summaries by source
category are in Table 1 and detailed inventory data is contained in the
docket maintained by EPA.
Although the 1993 inventory can be considered representative of
attainment conditions because the NAAQS was not violated during 1993,
the WDOE established CO emissions for the attainment year, 1993, as
well as five forecast years out to the year 2010 (1995, 1998, 2005,
2007 and 2010) in their redesignation request. The future emission
estimates are based on forecast assumptions about growth of the
regional economy and vehicle miles traveled. The assumptions for the
annual VMT growth rate and the annual employment growth rate were
calculated using the State Highway Performance Monitor System, regional
VMT data and the Central Puget Sound Regional Econometric Model
respectively. Stationary and mobile source inventories were compiled
following EPA guidance. Mobile source emission estimates were prepared
following the approach recommended by EPA. The WDOE used the Highway
Performance Monitor System and regional transportation system network
data to estimate vehicle miles traveled and used the MOBILE 5.1
emission model for CO emissions estimates.

Table 1.--1993 CO Attainment Year Emissions Inventory for the Seattle-Tacoma-Everett Nonattainment Area (Tons
per Winter Day)
----------------------------------------------------------------------------------------------------------------
Year Area Nonroad Mobile Point Total
----------------------------------------------------------------------------------------------------------------
1993........................................... 316 214 1497 61 2088
----------------------------------------------------------------------------------------------------------------

Seattle-Tacoma-Everett Nonattainment Area CO Emissions Inventory Projections (Tons per Winter Day)
----------------------------------------------------------------------------------------------------------------
Year Area Nonroad Mobile Point Total
----------------------------------------------------------------------------------------------------------------
1995........................................... 317 211 1290 61 1879
1998........................................... 317 221 1458 61 2057
2001........................................... 318 218 1317 61 1914
2005........................................... 319 198 1262 61 1840
2007........................................... 320 195 1259 61 1835
2010........................................... 321 198 1253 61 1833
----------------------------------------------------------------------------------------------------------------

B. Demonstration of Maintenance: Projected Inventories
Total CO emissions were projected from the 1993 attainment year out
to 2010. These projected inventories were prepared in accordance with
EPA guidance. The projections show that calculated CO emissions,
assuming no oxygenated fuels program, are not expected to exceed the
level of the 1993 attainment year inventory during this time period.
The WDOE will discontinue implementation of the Oxygenated Fuel program
in the Seattle-Tacoma-Everett Consolidated Metropolitan Statistical
Area (CMSA) once approval of the CO maintenance plan becomes effective.
Therefore, it is anticipated that the Seattle-Tacoma-Everett area will
maintain the CO standard without the oxygenated fuels program, and this
program would not need to be implemented following redesignation,
except as a contingency measure.
C. Verification of Continued Attainment
Verification of continued attainment of the CO NAAQS in the
Seattle-Tacoma-Everett area depends, in part, on the State's efforts
toward tracking indicators of continued attainment during the
maintenance period. The WDOE has also committed to perform
comprehensive reviews of the CO maintenance plan commencing in the year
2000 and occurring again at four year intervals in 2004 and 2008. The
plan elements to be reviewed at each of these times include VMT and
socioeconomic forecasts; emission inventory projections and control
strategy implementation effectiveness. The results of the plan review
in 2008 will be used as the basis for developing a CO maintenance plan
for the next maintenance planning period.
In addition, the WDOE has committed to pursuing amendments to the
maintenance plan if substantive changes are required as a result of the
above reviews.
D. Contingency Plan
Section 175A(d) of the CAA requires that all control measures
contained in the SIP prior to redesignation be retained as contingency
measures in the CO maintenance plan. Since the oxygenated fuels program
was a control measure contained in the SIP prior to redesignation, the
WDOE SIP retains oxygenated fuels as the contingency measure in the
maintenance plan. The plan contains a triggering mechanism to determine
when the contingency measure is needed. In the event of a future CO
violation, implementation of the oxygenated fuels program will be
triggered. This contingency measure would require all gasoline blended
for

[[Page 29518]]

sale in the Puget Sound CO nonattainment area during the winter months
to contain an average oxygenate content of at least 2.7 percent by
weight. Program requirements would be identical to those incorporated
into the current oxygenated gasoline program (Chapter 173-492,
Washington Administrative Code, Motor Fuel Specifications for
Oxygenated Gasoline, adopted October 6, 1992 and PSAPCA Regulation II,
Section 2.09, Oxygenated Gasoline, adopted October 14, 1993).
This contingency measure will be triggered in the event of a
quality-assured violation of the NAAQS for CO at any one of the
permanent monitoring sites in the nonattainment area. Thus, this
triggering will occur when any one monitoring site records two 8-hour
average CO concentrations that equal or exceed 9.5 ppm in a single
calendar year.
The oxygenated fuels program will be fully implemented no later
than the next full winter season following the date when the trigger
was activated. Implementation will continue throughout the balance of
the CO maintenance period, or until such time that a reassessment of
the ambient CO monitoring data establishes that the contingency measure
is no longer necessary.
As mentioned above, the WDOE has chosen to convert its oxygenated
fuels requirement in the Seattle-Tacoma-Everett CMSA to a contingency
measure in its maintenance plan upon redesignation. EPA is approving
the WDOE's contingency measure for the Seattle-Tacoma-Everett area.
E. Subsequent Maintenance Plan Revisions
In accordance with section 175A(b) of the CAA, the State has agreed
to submit a revised maintenance SIP eight years after the area is
redesignated to attainment. That revised SIP will provide for
maintenance for an additional ten years.

Conclusion

EPA proposes to approve the Seattle-Tacoma-Everett, Washington CO
maintenance plan and request for redesignation to attainment because
WDOE has demonstrated compliance with the requirements of section
107(d)(3)(E) for redesignation.
In addition, EPA, after notification of and consultation with the
affected tribal governments, proposes to redesignate to attainment
those areas in the Seattle-Tacoma-Everett CO nonattainment area that
are located within the Tulalip Reservation, the Puyallup Reservation
and the Muckleshoot Reservation. The Agency believes that the
redesignation requirements are effectively satisfied here based on
information provided by WDOE and requirements contained in the WDOE SIP
and maintenance plan.
EPA is soliciting public comments on this notice and on issues
relevant to EPA's proposed action. Comments will be considered before
taking final action. Interested parties may participate in the federal
rule making procedure by submitting written comments to the person and
address listed in the ADDRESSES section at the beginning of this
notice.

IV. Administrative Review

Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., EPA
must prepare a regulatory flexibility analysis assessing the impact of
any proposed or final rule on small entities. 5 U.S.C. Secs. 603 and
604. Alternatively, EPA may certify that the rule will not have a
significant impact on a substantial number of small entities. Small
entities include small businesses, small not-for-profit enterprises,
and government entities with jurisdiction over populations of less than
50,000.
SIP approvals under section 110 and subchapter I, Part D of the CAA
do not create any new requirements, but simply approve requirements
that the state is already imposing. Therefore, because the federal SIP-
approval does not impose any new requirements, I certify that it does
not have a significant impact on any small entities affected. Moreover,
due to the nature of the federal-state relationship under the CAA,
preparation of a regulatory flexibility analysis would constitute
federal inquiry into the economic reasonableness of state action. The
CAA forbids EPA to base its actions concerning SIPs on such grounds.
Union Electric Co. v. U.S.E.P.A., 427 U.S. 246, 256-66 (S.Ct. 1976); 42
U.S.C. 7410(a)(2).
Under Section 202 of the Unfunded Mandates Reform Act of 1995
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA
must prepare a budgetary impact statement to accompany any proposed or
final rule that includes a Federal mandate that may result in estimated
costs to State, local, or tribal governments in the aggregate; or to
the private sector, of $100 million or more. Under Section 205, EPA
must select the most cost-effective and least burdensome alternative
that achieves the objectives of the rule and is consistent with
statutory requirements. Section 203 requires EPA to establish a plan
for informing and advising any small governments that may be
significantly or uniquely impacted by the rule.
EPA has determined that the proposed action promulgated does not
include a Federal mandate that may result in estimated costs of $100
million or more to either State, local, or tribal governments in the
aggregate, or to the private sector. This Federal action approves pre-
existing requirements under State or local law, and imposes no new
Federal requirements. Accordingly, no additional costs to State, local,
or tribal governments, or to the private sector, result from this
action.
Nothing in this action should be construed as permitting or
allowing or establishing a precedent for any future request for
revision to any SIP. Each request for revision to any SIP shall be
considered separately in light of specific technical, economic, and
environmental factors and in relation to relevant statutory and
regulatory requirements.
This action has been classified as a Table 3 action by the Regional
Administrator under the procedures published in the Federal Register on
January 19, 1989 (54 FR 2214-2224), as revised by a July 10, 1995,
memorandum from Mary Nichols, Assistant Administrator for Air and
Radiation. The Office of Management and Budget (OMB) has exempted this
regulatory action from E.O. 12866 review.

List of Subjects

40 CFR Part 52

Environmental protection, Air pollution control, Carbon monoxide,
Incorporation by reference, Intergovernmental relations.

40 CFR Part 81

Air pollution control, National parks, and Wilderness areas.

Authority: 42 U.S.C 7401-7671q.

Dated: May 22, 1996.
Jane S. Moore,
Acting Regional Administrator.
[FR Doc. 96-14679 Filed 6-10-96; 8:45 am]
BILLING CODE 6560-50-P

Complete official Federal Register PDF

FR Doc. 96-14612 Privacy Act; Maintenance of and Access to Records Pertaining to Individuals; Amendment

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29522-29523]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14612]

=======================================================================
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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

49 CFR Part 10

[Docket No. OST-96-1437; Notice 96-19]
RIN 2105-AC57

Privacy Act; Maintenance of and Access to Records Pertaining to 
Individuals; Amendment

AGENCY: Department of Transportation (DOT), Office of the Secretary.

ACTION: Notice of Proposed Rulemaking.

-----------------------------------------------------------------------

SUMMARY: DOT proposes to amend its regulations in implementing the 
Privacy Act, 5 U.S.C. 552a. This revision updates organizational 
changes since the last revision and streamlines the regulations in 
order to make the regulations more useful. Public comment is invited.

DATES: Comments are due August 12, 1996.

ADDRESSES: Comments should be addressed to Documentary Services 
Division, Attention: Docket Section, Room PL401, Docket No. OST-96-
1437, Department of Transportation, C-55, Washington, DC 20590. Any 
person wishing acknowledgment that his/her comments have been received 
should include a self-addressed stamped postcard. Comments received 
will be available for public inspection and copying in the Documentary 
Services Division, Room PL401, Department of Transportation Building, 
400 Seventh Street, SW, Washington, DC, from 10 AM to 5 PM ET Monday 
through Friday except Federal holidays.

FOR FURTHER INFORMATION CONTACT: Dorothy A. Chambers, Office of the 
General Counsel, C-12, Department of Transportation, Washington, DC 
20590, telephone (202) 366-4542, FAX (202) 366-7152.

SUPPLEMENTARY INFORMATION: The President instituted a Regulatory Review 
initiative, for the reinvention of regulations by eliminating 
duplicate, redundant or unnecessary language and revising regulations 
to meet the need of users. In response to this initiative, we have 
reviewed part 10 and are proposing to revise this section to update and 
streamline information on maintenance and access to records pertaining 
to individuals. The main revision is to remove from the Code of Federal 
Regulations Appendices B through J to this part and remove references 
to the appendices throughout the part. These appendices contain 
information that is available through the Notice of Records Systems 
published by the Federal Register, National Archives and Records 
Administration, which describes the systems of records maintained by 
all Federal agencies, including the Department and its components. 
Therefore, it is unnecessary to repeat this information in the 
regulations. Several other housekeeping corrections have also been 
made.

Analysis of regulatory impacts.

    This amendment is not a ``significant regulatory action'' within 
the meaning of Executive Order 12866. It is also not significant within 
the definition in DOT's Regulatory Policies and Procedures, 49 FR 11034 
(1979), in part because it does not involve any change in important 
Departmental policies. Because the economic impact should be minimal, 
further regulatory evaluation is not necessary. Moreover, I certify 
that this proposal will not have a significant economic impact on a 
substantial number of small entities.
    This proposal does not significantly affect the environment, and 
therefore an environmental impact statement is not required under the 
National Environmental Policy Act of 1969. It has also been reviewed 
under Executive Order 12612, Federalism, and it has been determined 
that it does not have sufficient implications for federalism to warrant 
preparation of a Federalism Assessment.
    Finally, the proposal does not contain any collection of 
information requirements, requiring review under the Paperwork 
Reduction Act of 1980.

 List of Subjects in 49 CFR Part 10

    Privacy.

    In accordance with the above, DOT proposes to amend 49 CFR part 10 
as follows:

PART 10--[AMENDED]

    1. The authority citation would continue to be as follows:

    Authority: 5 U.S.C. 552a; 49 U.S.C. 322.

Sec. 10.1  [Amended]

    2. In Sec. 10.1, paragraphs (b), (c), and (d) would be removed and 
the paragraph designation (a) would be removed.
    3. In Sec. 10.5, within the definition of Department, paragraph (f) 
would be revised, and a new paragraph (i) would be added to read as 
follows

Sec. 10.5  Definitions.

    Unless the context requires otherwise, the following definitions 
apply in this part:
 * * * * *
    Department * * *
* * * * *
    (f) Federal Transit Administration.
* * * * *
    (i) Bureau of Transportation Statistics.
 * * * * *
    4. In Sec. 10.31, paragraph (a) would be revised to read as 
follows:

Sec. 10.31  Requests for records.

    (a) Ordinarily, each person desiring to determine whether a record 
pertaining to him/her is contained in a system of records covered by 
this part or desiring access to a record covered by this part, or to 
obtain a copy of such a record, shall make a request in writing 
addressed to the system manager. The ``Notice of Records Systems'' 
published by the Office of the Federal Register, National Archives and 
Records Administration, describes the systems of records maintained by 
all Federal agencies, including the Department and its components. In 
exceptional cases oral requests are accepted. See Sec. 10.13(b) 
regarding inquiries concerning Privacy Act matters or requests for 
assistance.
* * * * *
    5. In Sec. 10.35, paragraph (a)(12) would be added to read as 
follows:

Sec. 10.35  Conditions of disclosure.

    (a) No record that is contained within a system of records of the 
Department is disclosed by any means of communication to any person, or 
to another agency, except pursuant to a written request by, or with the 
prior written consent of, the individual to whom the record pertains, 
unless disclosure of the record would be:
 * * * * *
    (12) To a consumer reporting agency in accordance with 31 U.S.C. 
3711(f).
* * * * *
    6. In Sec. 10.37, the last sentence would be revised to read as 
follows:

Sec. 10.37  Identification of individual making request.

    * * * In such cases, these additional requirements are listed in 
the public notice for the system.
    7. Section 10.39 would be revised to read as follows:

[[Page 29523]]

Sec. 10.39  Location of records.

    Each record made available under this subpart is available for 
inspection and copying during regular working hours at the place where 
it is located, or, upon reasonable notice, at the document inspection 
facilities of the Office of the Secretary or each administration. 
Original records may be copied but may not be released from custody. 
Upon payment of the appropriate fee, copies are mailed to the 
requester.
    8. Section 10.41 would be revised to read as follows:

Sec. 110.41  Requests for correction of records.

    Any person who desires to have a record pertaining to that person 
corrected shall submit a written request detailing the correction and 
the reasons the record should be so corrected. Requests for correction 
of records shall be submitted to the System Manager.
    9. In Sec. 10.51, paragraphs (c) and (h) would be revised to read 
as follows:

Sec. 10.51  General.

 * * * * *
    (c) Each application for review must be made in writing and must 
include all information and arguments relied upon by the person making 
the request, and be submitted within 30 days of the date of the initial 
denial; exceptions to this time period are permitted for good reason.
 * * * * *
    (h) Any final decision by an Administrator or his/her delegate not 
to grant access to or amend a record under this part, is subject to 
concurrence by the General Counsel or his or her delegate.

Appendix A [Redesignated as Appendix]

    10. Appendix A would be redesignated as ``Appendix''.

Appendices B-J [Removed]

    11. Appendices B through J would be removed.

    Issued in Washington, DC, on May 31, 1996.
Federico Pena,
Secretary of Transportation.
[FR Doc. 96-14612 Filed 6-10-96; 8:45 am]
BILLING CODE 4910-62-P

Complete official Federal Register PDF

FR Doc. 96-14606 Ohio Regulatory Program

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29504-29506]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14606]

=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF THE INTERIOR

Office of Surface Mining Reclamation and Enforcement

30 CFR Part 935

[OH-237-FOR, #71]

Ohio Regulatory Program

AGENCY: Office of Surface Mining Reclamation and Enforcement (OSM), 
Interior.

ACTION: Proposed rule; public comment period and opportunity for public 
hearing.

-----------------------------------------------------------------------

SUMMARY: OSM is announcing receipt of a proposed amendment to the Ohio 
regulatory program (hereinafter the ``Ohio program'') under the surface 
Mining Control and Reclamation Act of 1977 (SMCRA). The proposed 
amendment consists of changes to provisions of the Ohio rules 
pertaining to inspections. The amendment is intended to revise the Ohio 
program to be consistent with the corresponding Federal regulations.

DATES: Written comments must be received by 4:00 p.m., [E.D.T.] July 
11, 1996. If requested, a public hearing on the proposed amendment will 
be held on July 8, 1996. Requests to speak at the hearing must be 
received by 4:00 p.m., [E.D.T.], on June 26, 1996.

ADDRESSES: Written comments and requests to speak at the hearing should 
be mailed or hand delivered to George Rieger, Field Branch chief, at 
the address listed below.
    Copies of the Ohio program, the proposed amendment, a listing of 
any scheduled public hearings, and all written comments received in 
response to this document will be available for public review at the 
addresses listed below during normal business hours, Monday through 
Friday, excluding holidays. Each requester may receive one free copy of 
the proposed amendment by contacting OSM's Appalachian Regional 
Coordinating Center.

George Rieger, Field Branch Chief, Appalachian Regional Coordinating 
Center, Office of Surface Mining Reclamation and Enforcement, 3 Parkway 
Center, Pittsburgh, PA 15220, Telephone: (412) 937-2153
Ohio Division of Mines and Reclamation, 1855 Fountain Square Court, 
Columbus, Ohio 43224, Telephone: (614) 265-1076.

FOR FURTHER INFORMATION CONTACT: George Rieger, Field Branch Chief, 
Appalachian Regional Coordinating Center, Telephone: (412) 937-2153.

[[Page 29505]]

SUPPLEMENTARY INFORMATION:

I. Background on the Ohio Program

    On August 16, 1982, the Secretary of the Interior conditionally 
approved the Ohio program. Background information on the Ohio program, 
including the Secretary's findings, the disposition of comments, and 
the conditions of approval can be found in the August 10, 1982, Federal 
Register (42 FR 34688). Subsequent actions concerning the conditions of 
approval and program amendments can be found at 30 CFR 935.11, 935.15, 
and 935.16.

II. Description of the Proposed Amendment

    By letter dated May 17, 1996, (Administrative Record No. OH-2165-
00) Ohio submitted a proposed amendment to its program pursuant to 
SMCRA at its own initiative. The provisions of the Ohio Administrative 
Code (OAC) that Ohio proposes to amend are: OAC 1501:13-14-01--
Inspections.
    Specifically, in its definition of ``inactive coal mining and 
reclamation operation,'' Ohio proposes to clarify that only the 
completion of Phase II reclamation is necessary for a site to be 
considered inactive for the purpose of inspection frequency by deleting 
the reference to bond reduction. Ohio also proposes to add language 
that specifies that those portions of an active operation on which 
Phase II reclamation is complete will be considered inactive for the 
purpose of inspection frequency. Finally, Ohio proposes to delete an 
outdated reference to permits other than permanent program ``D'' 
permits.

III. Public Comment Procedures

    In accordance with the provisions of 30 CFR 732.17(h), OSM is 
seeking comments on whether the proposed amendment satisfies the 
applicable program approval criteria of 30 CFR 732.15. If the amendment 
is deemed adequate, it will become part of the Ohio program.

Written Comments

    Written comments should be specific, pertain only to the issues 
proposed in this rulemaking, and include explanations in support of the 
commenter's recommendations. Comments received after the time indicated 
under DATES or at locations other than the Appalachian Regional 
Coordinating Center will not necessarily be considered in the final 
rulemaking or included in the Administrative Record.

Public Hearing

    Persons wishing to speak at the public hearing should contact the 
person listed under FOR FURTHER INFORMATION CONTACT by 4:00 p.m., 
[E.D.T.] on June 26, 1996. The location and time of the hearing will be 
arranged with those persons requesting the hearing. If no one requests 
an opportunity to speak at the public hearing, the hearing will not be 
held.
    Filing of a written statement at the time of the hearing is 
requested as it will greatly assist the transcriber. Submission of 
written statements in advances of the hearing will allow OSM officials 
to prepare adequate responses and appropriate questions.
    The pubic hearing will continue on the specified date until all 
persons scheduled to speak have been heard. Persons in the audience who 
have not been scheduled to speak, and who wish to do so, will be heard 
following those who have been scheduled. The hearing will end after all 
persons scheduled to speak and persons present in the audience who wish 
to speak have been heard.
    Any disabled individual who has need for a special accommodation to 
attend a public hearing should contact the individual listed under FOR 
FURTHER INFORMATION CONTACT.

Public Meeting

    If only one person requests an opportunity to speak at a hearing, a 
public meeting, rather than a public hearing, may be held. Persons 
wishing to meet with OSM representatives to discuss the proposed 
amendment may request a meeting by contacting the person listed under 
FOR FURTHER INFORMATION CONTACT. All such meetings will be open to the 
public and, if possible, notices of meetings will be posted at the 
locations listed under ADDRESSES. A written summary of each meeting 
will be made a part of the Administrative Record.

IV. Procedural Determinations.

Executive Order 12866

    This rule is exempted from review by the Office of Management and 
Budget (OMB) under Executive Order 12866 (Regulatory Planning and 
Review).

Executive Order 12778

    The Department of the Interior has conducted the reviews required 
'by section 2 of Executive Order 12778 (Civil Justice Reform) and has 
determined that, to the extent allowed by law, this rule meets the 
applicable standards of subsections (a) and (b) of that section. 
However, these standards are not applicable to the actual language of 
State regulatory programs and program amendments since each such 
program is drafted and promulgated by a specific State, not by OSM. 
Under sections 503 and 505 of SMCRA (30 U.S.C. 1253 and 1255) and 30 
CFR 730.11, 732.15, and 732.17(h)(10), decisions on proposed State 
regulatory programs and program amendments submitted by the States must 
be based solely on a determination of whether the submittal is 
consistent with SMCRA and its implementing Federal regulations and 
whether the other requirements of 30 CFR Parts 730, 731, and 732 have 
been met.

National Environmental Policy Act

    No environmental impact statement is required for this rule since 
section 702(d) of SMCRA (30 U.S.C. 1292(d)) provides that agency 
decisions on proposed State regulatory program provisions do not 
constitute major Federal actions within the meaning of section 
102(2)(C) of the National Environmental Policy Act (42 U.S.C. 
4332(2)(C)).

Paperwork Reduction Act

    This rule does not contain information collection requirements that 
require approval by OMB under the Paperwork Reduction Act (44 U.S.C. 
3507 et seq.).

Regulatory Flexibility Act

    The Department of the Interior has determined that this rule will 
not have a significant economic impact on a substantial number of small 
entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). 
The State submittal which is the subject of this rule is based upon 
counterpart Federal regulations for which an economic analysis was 
prepared and certification made that such regulations would not have a 
significant economic effect upon a substantial number of small 
entities. Accordingly, this rule will ensure that existing requirements 
previously promulgated by OSM will be implemented by the State. In 
making the determination as to whether this rule would have a 
significant economic impact, the Department relied upon the data and 
assumptions for the counterpart Federal regulations.

List of Subjects in 30 CFR Part 935

    Intergovernmental relations, Surface mining, Underground mining.

[[Page 29506]]

    Dated: May 31, 1996.
Allen D. Klein,
Regional Director, Appalachian Regional Coordinating Center.
[FR Doc. 96-14606 Filed 6-10-96; 8:45 am]
BILLING CODE 4310-05-M

Complete official Federal Register PDF

FR Doc. 96-14605 Virginia Regulatory Program

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29506-29508]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14605]

-----------------------------------------------------------------------

DEPARTMENT OF THE INTERIOR
30 CFR Part 946

[VA-106-FOR]

Virginia Regulatory Program

AGENCY: Office of Surface Mining Reclamation and Enforcement (OSM), 
Interior.

ACTION: Proposed rule; public comment period and opportunity for public 
hearing.

-----------------------------------------------------------------------

SUMMARY: OSM is announcing receipt of a proposed amendment to the 
Virginia regulatory program (hereinafter referred to as the Virginia 
program) under the Surface Mining Control and Reclamation Act of 1977 
(SMCRA). The proposed amendment consists of regulatory changes to 
implement the standards of the Federal Energy Policy Act of 1992, and 
the Code of Virginia as amended in 1993. The amendment is intended to 
revise the State program to be consistent with the Federal regulations 
as amended on March 31, 1995 (60 FR 16772).

DATES: Written comments must be received by 4:00 p.m., on July 11, 
1996. If requested, a public hearing on the proposed amendment will be 
held on July 8, 1996. Requests to speak at the hearing must be received 
by 4:00 p.m., on June 26, 1996.

ADDRESSES: Written comments and requests to speak at the hearing should 
be mailed or hand delivered to Mr. Robert A. Penn, Director, Big Stone 
Gap Field Office at the first address listed below.
    Copies of the Virginia program, the proposed amendment, a listing 
of any scheduled public hearings, and all written comments received in 
response to this document will be available for public review at the 
addresses listed below during normal business hours, Monday through 
Friday, excluding holidays. Each requestor may receive one free copy of 
the proposed amendment by contacting OSM's Big Stone Gap Field Office.

Office of Surface Mining Reclamation and Enforcement, Big Stone Gap 
Field Office, 1941 Neeley Road, Suite 201, Compartment 116, Big Stone 
Gap, Virginia 24219, Telephone: (703) 523-4303
Virginia Division of Mined Land Reclamation, P.O. Drawer 900, Big Stone 
Gap, Virginia 24219, Telephone: (703) 523-8100.

FOR FURTHER INFORMATION CONTACT:
Mr. Robert A. Penn, Director, Big Stone Gap Field Office, Telephone: 
(703) 523-4303.

SUPPLEMENTARY INFORMATION:

I. Background on the Virginia Program

    On December 15, 1981, the Secretary of the Interior conditionally 
approved the Virginia program. Background information on the Virginia 
program, including the Secretary's findings, the disposition of 
comments, and the conditions of approval can be found in the December 
15, 1981, Federal Register (46 FR 61085-61115). Subsequent actions 
concerning the conditions of approval and program amendments can be 
found at 30 CFR 946.12, 946.13, 946.15 and 946.16.

II. Discussion of the Proposed Amendment

    By letter dated May 21, 1996 (Administrative Record No. VA-882), 
Virginia submitted amendments to the Virginia program concerning 
subsidence damage. The amendments are intended to make the Virginia 
program consistent with the Federal regulations as amended on March 31, 
1995 (60 FR 16722). Virginia stated that the proposed amendments 
implement the standards of the Federal Energy Policy Act of 1992, and 
sections 45.1-243 and 45.1-258 of the Code of Virginia.
    Virginia also noted that the State has adopted a revised system for 
numbering the Virginia regulations. For the Virginia program, the 
prefix ``480-03-19'' has been replaced with ``4 VAC 25-130-.'' The part 
of the existing Virginia numbering system that corresponds to the 
Federal number remains the same. For example, old ``480-03-19.700.5'' 
has been ``4 VAC 25-130-700.5.'' The Virginia Division of Mines, 
Minerals and Energy (DMME) will be reprinting the Virginia program 
regulations to incorporate the new prefix, both in the numbering of the 
regulations and in references contained in the regulations. However, 
the DMME is continuing to use the ``480-03-19.'' prefix pending the 
reprint.
    The proposed amendments are as follows:

1. Sec. 480-03-19.700.5  Definitions

    (a) ``Drinking, domestic or residential water supply'' has been 
added to mean water received from a well or spring and any appurtenant 
delivery system that provides water for direct human consumption or 
household use. Wells and springs that serve only agricultural, 
commercial or industrial enterprises are not included except to the 
extent the water supply is for direct human consumption or human 
sanitation, or domestic use.
    (b) ``Material damage, in the context of Secs. 480-03-19.784.20 and 
480-03-19.817.121'' of this chapter has been added to mean:
    (a) Any functional impairment of surface lands, features, 
structures or facilities;
    (b) Any physical change that has a significant adverse impact on 
the affected land's capability to support any current or reasonably 
foreseeable uses or causes significant loss in production or income; or
    (c) Any significant change in the condition, appearance or utility 
of any structure or facility from its presubsidence condition.
    (c) ``Non-commercial building'' has been added to mean any 
building, other than an occupied residential dwelling, that, at the 
time the subsidence occurs, is used on a regular or temporary basis as 
a public building or community or institutional building as those terms 
are defined in Sec. 480-03-19.700.5 of this chapter. Any building used 
only for commercial agricultural, industrial, retail or other 
commercial enterprises is excluded.
    (d) ``Occupied residential dwelling and structures related 
thereto'' has been added to mean, for purposes of Secs. 480-03-
19.784.20 and 480-03-19.817.121, any building or other structures that, 
at the time the subsidence occurs, is used either temporally, 
occasionally, seasonally, or permanently for human habitation. This 
term also includes any building, structure or facility installed on, 
above or below, or a combination thereof, the land surface if that 
building, structure or facility is adjunct to or used in connection 
with an occupied dwelling. Examples of such structures include, but are 
not limited to, garages; storage sheds and barns; greenhouses and 
related buildings, utilities and cables, fences and other enclosures; 
retaining walls; paved or improved patios, walks and driveways; septic 
treatment facilities; and lot drainage and lawn and garden irrigation 
systems. Any structure used only for commercial agricultural, 
industrial, retail or other commercial purposes is excluded.
    (e) ``Replacement of water supply'' has been added to mean, with 
respect to protected water supplies contaminated, diminished, or 
interrupted by coal mining operations, provision of water supply on 
both a temporary and permanent basis equivalent to premining quantity 
and quality. Replacement includes provision of an

[[Page 29507]]

equivalent water delivery system and payment of operation and 
maintenance costs in excess of customary and reasonable delivery costs 
for premining water supplies.
    (a) Upon agreement by the permittee and the water supply owner, the 
obligation to pay such operation and maintenance costs may be satisfied 
by a one-time payment of amount which covers the present worth of the 
increased annual operation and maintenance costs for a period agreed to 
by the permittee and the water supply owner.
    (b) If the affected water supply was not needed for the land use in 
existence at the time of loss, contamination, or diminution, and if the 
supply is not needed to achieve the post mining land use, replacement 
requirements may be satisfied by demonstrating that a suitable 
alternative water source is available and could feasibly be developed. 
If the latter approach is selected, written concurrence must be 
obtained from the water supply owner.

2. Sec. 480-03-19.784.14  Hydrologic Information

    Subsection (e) has been amended by adding new subsection (e)(3)(iv) 
to provide that the probable hydrologic consequences (PHC) 
determination shall contain findings on: ``Whether the underground 
mining activities conducted after October 24, 1992 may result in 
contamination, diminution or interruption of a well or spring in 
existence at the time the permit application is submitted and used for 
domestic, drinking, or residential purposes within the permit or 
adjacent areas.''

3. Sec. 480-03-19.784.10  Subsidence Control Plan

    The existing language of this provision is deleted and replace by 
new language. New subsection (a) provides for a pre-subsidence survey 
that includes a map to identify structures, renewable resource lands 
and drinking, domestic and residential water supplies that subsidence 
may affect; an accompanying narrative; and a pre-subsidence survey of 
all non-commercial buildings or occupied residential dwellings and 
structures related thereto, that may be damaged by subsidence, and a 
survey of the quantity and quality of all drinking, domestic, and 
residential water supplies within the permit and adjacent area that 
could be contaminated, diminished, or interrupted by subsidence.
    Subsection (b) provides for a subsidence control plan. The 
subsidence control plan shall contain a description of the mining 
method; a map of underground workings showing areas of planned 
subsidence, and areas where measures to minimize subsidence and 
subsidence related damage; a description of the overlying rock strata 
that affect the likelihood or extent of subsidence and subsidence 
related damage; a description of monitoring if needed; a description of 
subsidence control measures, except for areas where planned subsidence 
is projected to be used; a description of the anticipated effects of 
planned subsidence, if any; a description of methods to be employed to 
minimize the effects of planned subsidence, or the written consent of 
the owner that such measures not be taken; a description of the 
measures to be taken to replace adversely affected protected water 
supplies or to mitigate or remedy any subsidence related material 
damage to the land and protected structures; and other information as 
specified by the Division of Mined Land Reclamation (DMLR).

4. Sec. 480-03-19.817.41  Hydrologic Balance Protection

    New subsection (j) is added to provide that the permittee must 
promptly replace any drinking, domestic or residential water supply 
that is contaminated, diminished or interrupted by underground mining 
activities conducted after October 24, 1992, if the affected well or 
spring was in existence before the date the DMLR received the permit 
application for the activities causing the loss, contamination or 
interruption. The baseline hydrologic information required in Sec. 480-
03-19.784.14 and the geologic information concerning baseline 
hydrologic conditions required in Sec. 480-03-784.22 will be used to 
determine the impact of mining activities upon the water supply.

5. Sec. 480-03-19.817.121  Subsidence Control

    Subsection (a) concerning measures to prevent or minimize damage is 
amended by adding new language to provide that planned subsidence must 
include measures to minimize material damage to protected structures, 
except if the permittee has written consent of the structure owners, or 
unless the anticipated damage would constitute a threat to health or 
safety, the costs of such measures exceed the anticipated costs of 
repair, or the structure owners deny the permittee access to implement 
the measures to minimize material damage and the permittee provides 
written evidence of good faith efforts to obtain access.
    Subsection (c) has been revised by deleting the existing language 
and replacing new language. The new language provides for the repair of 
damage to surface lands; the repair or compensation for damage to non-
commercial buildings and dwellings and related structures; repair or 
compensation for damage to other structures; rebuttable presumption of 
causation by subsidence; approval of site-specific angle of draw; no 
presumption where access for pre-subsidence survey is denied; rebuttal 
of presumption; information to be considered in determination of 
causation.; and adjustment of bond amount for subsidence damage.

III. Public Comment Procedures

    In accordance with the provisions of 30 CFR 732.17(h), OSM is now 
seeking comment on whether the amendments proposed by Virginia satisfy 
the applicable program approval criteria of 30 CFR 732.15. If the 
amendments are deemed adequate, they will become part of the Virginia 
program.

Written Comments

    Written comments should be specific, pertain only to the issues 
proposed in this rulemaking, and include explanations in support of the 
commenter's recommendations. Comments received after the time indicated 
under DATES or at locations other than the Big Stone Gap Field Office 
will not necessarily be considered in the final rulemaking or included 
in the Administrative Record.

Public Hearing

    Persons wishing to comment at the public hearing should contact the 
person listed under FOR FURTHER INFORMATION CONTACT by close of 
business on June 26, 1996. If no one requests an opportunity to comment 
at a public hearing, the hearing will not be held.
    Filing of a written statement at the time of the hearing is 
requested as it will greatly assist the transcriber. Submission of 
written statements in advance of the hearing will allow OSM officials 
to prepare adequate response and appropriate questions.
    The public hearing will continue on the specified date until all 
persons scheduled to comment have been heard. Persons in the audience 
who have not been scheduled to comment, and who wish to do so, will be 
heard following those scheduled. The hearing will end after all persons 
scheduled to comment and persons present in the audience who wish to 
comment have been heard.

[[Page 29508]]

Public Meeting

    If only one person requests an opportunity to comment at a hearing, 
a public meeting, rather than a public hearing, may be held. Persons 
wishing to meet with OSM representatives to discuss the proposed 
amendments may request a meeting at the Big Stone Gap Field Office by 
contacting the person listed under FOR FURTHER INFORMATION CONTACT. All 
such meetings will be open to the public and, if possible, notices of 
meetings will be posted in advance at the locations listed under 
ADDRESSES. A written summary of each public meeting will be made part 
of the Administrative Record.
    Any disabled individual who has need for a special accommodation to 
attend a public hearing should contact the individual listed under FOR 
FURTHER INFORMATION CONTACT.

IV. Procedural Determinations

Executive Order 12866

    This rule is exempted from review by the Office of Management and 
Budget (OMB) under Executive Order 12866 (Regulatory Planning and 
Review).

Executive Order 12988

    The Department of the Interior has conducted the reviews required 
by section 3 of Executive Order 12778 (Civil Justice Reform) and has 
determined that, to the extent allowed by law, this rule meets the 
applicable standards of subsections (a) and (b) of that section. 
However, these standards are not applicable to the actual language of 
State regulatory programs and program amendments since each such 
program is drafted and promulgated by a specific State, not by OSM. 
Under sections 503 and 505 of SMCRA (30 U.S.C. 1253 and 1255) and 30 
CFR 730.11, 732.15 and 732.17(h)(10), decisions on proposed State 
regulatory programs and program amendments submitted by the States must 
be based solely on a determination of whether the submittal is 
consistent with SMCRA and its implementing Federal regulations and 
whether the other requirements of 30 CFR Parts 730, 731, and 732 have 
been met.

National Environmental Policy Act

    No environmental impact statement is required for this rule since 
section 702(d) of SMCRA [30 U.S.C. 1292(d)] provides that agency 
decisions on proposed State regulatory program provisions do not 
constitute major Federal actions within the meaning of section 
102(2)(C) of the National Environmental Policy Act (42 U.S.C. 
4332(2)(C)).

Paperwork Reduction Act

    This rule does not contain information collection requirements that 
require approval by OMB under the Paperwork Reduction Act (44 U.S.C. 
3507 et seq.).

Regulatory Flexibility Act

    The Department of the Interior has determined that this rule will 
not have a significant economic impact on a substantial number of small 
entities under the Regulatory Flexibility Act (5 U.S.C. 601 et. seq.). 
The State submittal which is the subject of this rule is based upon 
counterpart Federal regulations for which an economic analysis was 
prepared and certification made that such regulations would not have a 
significant economic effect upon a substantial number of small 
entities. Accordingly, this rule will ensure that existing requirements 
previously promulgated by OSM will be implemented by the State. In 
making the determination as to whether this rule would have a 
significant economic impact, the Department relied upon the data and 
assumptions for the counterpart Federal regulations.

Unfunded Mandates

    This rule will not impose a cost of $100 million or more in any 
given year on any governmental entity or the private sector.

List of Subjects in 30 CFR Part 946

    Intergovernmental relations, Surface mining, Underground mining.

    Dated: May 31, 1996.
Allen D. Klein,
Regional Director, Appalachian Regional Coordinating Center.
[FR Doc. 96-14605 Filed 6-10-96; 8:45 am]
BILLING CODE 4310-05-M

Complete official Federal Register PDF

FR Doc. 96-14496 Office of Federal Housing Enterprise Oversight; Risk-Based Capital

[Federal Register Volume 61, Number 113 (Tuesday, June 11, 1996)]
[Proposed Rules]
[Pages 29592-29621]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14496]

[[Page 29591]]

_______________________________________________________________________

Part III

Department of Housing and Urban Development

_______________________________________________________________________

12 CFR Part 1270

Risk-Based Capital; Proposed Rule

Federal Register / Vol. 61, No. 113 / Tuesday, June 11, 1996 / 
Proposed Rules

[[Page 29592]]

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

12 CFR Part 1270

RIN 2550-AA02

Office of Federal Housing Enterprise Oversight; Risk-Based 
Capital

AGENCY: Office of Federal Housing Enterprise Oversight, HUD.

ACTION: Notice of Proposed Rulemaking.

-----------------------------------------------------------------------

SUMMARY: Title XIII of the Housing and Community Development Act of 
1992, known as the Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992 (1992 Act), requires the Office of Federal 
Housing Enterprise Oversight (OFHEO) to develop a risk-based capital 
regulation for the Federal National Mortgage Association (Fannie Mae) 
and the Federal Home Loan Mortgage Corporation (Freddie Mac) 
(collectively, the Enterprises). The regulation will specify a risk-
based capital stress test (stress test) that, when applied to the 
Enterprises, determines the amount of capital that an Enterprise must 
hold to maintain positive capital throughout a 10-year period of 
economic stress. On February 8, 1995, OFHEO published an Advance Notice 
of Proposed Rulemaking (ANPR), which solicited public comment on a 
variety of issues concerning the development of the risk-based capital 
regulation. In light of the complex issues and decisions that OFHEO 
must address prior to issuing proposed risk-based capital standards and 
the challenge of developing the risk-based capital stress test, OFHEO 
has decided to issue the proposed risk-based capital regulation in two 
parts.
    This first Notice of Proposed Rulemaking (NPR) addresses two key 
components of the stress test. The first is OFHEO's proposal of the 
procedures for establishing the ``benchmark loss experience,'' which is 
the basis for determining the extent of Enterprise credit losses during 
the stress test. This NPR describes the methodology and rationale OFHEO 
used to identify the proposed benchmark loss experience, responds to 
relevant ANPR comments, and describes how the benchmark loss experience 
will influence the risk-based capital stress test. In this NPR, OFHEO 
also proposes to use its House Price Index (HPI) in the stress test to 
estimate changes over time in the values of single-family properties 
securing Enterprise mortgages.
    A second NPR will: specify the timing and content of risk-based 
capital reports to be submitted by the Enterprises; specify all of the 
remaining aspects of the risk-based capital stress test; and describe 
how the stress test will be used to determine the Enterprises' risk-
based capital requirements.

DATES: Comments regarding this NPR must be received in writing on or 
before September 9, 1996.

ADDRESSES: Send written comments to Anne E. Dewey, General Counsel, 
Office of General Counsel, Office of Federal Housing Enterprise 
Oversight, 1700 G Street, NW., Fourth Floor, Washington, DC 20552.

FOR FURTHER INFORMATION CONTACT: David J. Pearl, Director, Office of 
Research, Analysis and Capital Standards; or Gary L. Norton, Deputy 
General Counsel, Office of General Counsel, Office of Federal Housing 
Enterprise Oversight, 1700 G Street, NW., Fourth Floor, Washington, DC 
20552, telephone (202) 414-3800 (not a toll-free number).

SUPPLEMENTARY INFORMATION: The Supplementary Information is organized 
according to this table of contents:

Background

Statutory Requirements for Risk-Based Capital
    Credit Losses in the Stress Test
    Interest Rates in the Stress Test
    New Business, Other Activities, and Considerations
    Management and Operations Risk
Regulation Development
    General Approach
    Advance Notice of Proposed Rulemaking
    Notice of Proposed Rulemaking
Benchmark Loss Experience
    Definitions, Data, and Procedures
    1. Definitions
    2. Data
    3. Procedures
    Characterization of the Benchmark Loss Experience Implications 
of the Benchmark Loss Experience for the Stress Test Issues, 
Alternatives Considered, and Comments Received
    1. Data Sources Used to Define the Benchmark Loss Experience
    2. Loan and Property Types Included in the Benchmark Analysis
    3. Determination of a Single Benchmark State/Origination Year 
Combination or a Separate Area and Period for Each Enterprise
    4. Role of Severity Data in Identifying the Benchmark Loss 
Experience
    5. Definition of ``Default Rate''
    a. In General
    b. Interpretation of ``Years''
    c. Definition of ``Defaulted Loans''
    6. Definitions of ``Severity Rate'' and ``Losses''
    7. Definition of ``Contiguous Areas''
    8. Procedures for Accounting for Different LTV Ratios
    9. Procedures for Combining Data from Different States and Years 
in Computing Default and Severity Rates
    10. Procedures for Combining Default and Severity Rates of the 
Two Enterprises
    11. Number of Origination Years in the Benchmark Loss Experience
House Price Indexes
    Introduction
    Using An Index to Adjust for Seasoning
    Description of the HPI
    Issues, Alternatives Considered, and Comments Received
    1. Use of the HPI versus the CQHPI and Other Alternatives
    2. Geographic Aggregation
    3. Bias and Volatility in the HPI
    4. Statistical Methodology

Background

    Title XIII of the Housing and Community Development Act of 1992, 
Pub. L. No. 102-550, known as the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992, established OFHEO. OFHEO is an 
independent office within the Department of Housing and Urban 
Development (HUD) with responsibility for ensuring that Fannie Mae and 
Freddie Mac are adequately capitalized and operating in a safe and 
sound manner. Included among the express statutory authorities of the 
Director of OFHEO (Director) is the authority to issue regulations 
establishing minimum and risk-based capital standards.1
---------------------------------------------------------------------------

    \1\ 1992 Act, section 1313(b)(1) (12 U.S.C. 4513(b)(1)).
---------------------------------------------------------------------------

    Fannie Mae and Freddie Mac are Government-sponsored enterprises 
with important public purposes.2 These include providing liquidity 
to the residential mortgage market and increasing the availability of 
mortgage credit benefiting low-and moderate-income families and areas 
that are underserved by lending institutions. The Enterprises engage in 
two principal businesses: Investing in residential mortgages and 
guaranteeing residential mortgage securities. The securities they 
guarantee and the debt instruments they issue are not backed by the 
full faith and credit of the United States.3 However, financial 
market participants perceive that the United States Government would 
not permit the Enterprises to fail. This perception principally arises 
from the public purposes of the Enterprises, their Congressional 
charters, their potential direct access to Treasury funds, and the 
statutory exemptions of their debt and mortgage-backed securities from 
otherwise mandatory investor protection provisions.4

[[Page 29593]]

Furthermore, the insolvency of either of the Enterprises would have 
serious consequences for the nation's housing markets and financial 
system.
---------------------------------------------------------------------------

    \2\ See 1992 Act, sections 1331-38 (12 U.S.C. 4561-67, 4562 
note).
    \3\ See section 306(h)(2), Federal Home Loan Mortgage 
Corporation Act (12 U.S.C. 1455(h)(2)), and section 304(b), Federal 
National Mortgage Association Charter Act (12 U.S.C. 1719(b)).
    \4\ See, e.g., 12 U.S.C. 24 (seventh) (authorizing unlimited 
investment by national banks in obligations of or issued by the 
Enterprises); 12 U.S.C. 1455(g), 1719(d), 1723c (exempting 
securities from oversight from federal regulators); 15 U.S.C. 77r-
1(a) (preempting state law that would treat Enterprise securities 
differently from obligations of the United States for investment 
purposes); 15 U.S.C. 77r-1(c) (exempting Enterprise securities from 
state blue sky laws).
---------------------------------------------------------------------------

    OFHEO was created as the safety and soundness regulator of the 
Enterprises to reduce the risk of their failure. OFHEO's principal 
responsibilities include conducting examinations and establishing and 
enforcing compliance with capital standards. At least quarterly, OFHEO 
ascertains the amount of capital maintained by each Enterprise, 
computes its capital requirements, and determines its capital 
classification.5
---------------------------------------------------------------------------

    \5\ Section 1364 of the 1992 Act (12 U.S.C. 4614) requires the 
Director of OFHEO to determine the capital classification of each 
Enterprise not less than quarterly.
---------------------------------------------------------------------------

    Capital provides a cushion to absorb financial losses resulting 
from adverse economic conditions and other problems at the Enterprises. 
The 1992 Act prescribes that to be classified as adequately 
capitalized, an Enterprise must meet both a minimum capital standard 
and a risk-based capital standard.
    Section 1362 of the 1992 Act prescribes the minimum capital 
standard for the Enterprises.6 The minimum capital requirements 
are computed from ratios that are applied to the assets and specific 
categories of off-balance sheet obligations of the Enterprises. The 
minimum capital requirement for an Enterprise represents an amount of 
capital needed to provide protection against risk in general. The 
minimum capital standard is not designed to address specific credit 
risk exposures or exposure to interest rate risk. It does not represent 
the amount needed by an Enterprise to operate safely and soundly under 
all circumstances.
---------------------------------------------------------------------------

    \6\ 12 U.S.C. 4612.
---------------------------------------------------------------------------

    OFHEO published a proposed rule regarding minimum capital on June 
8, 1995. Until 1 year after the effective date of a final rule on risk-
based capital, an Enterprise need only meet the minimum capital 
standard in order to be classified as adequately capitalized.

Statutory Requirements for Risk-Based Capital

    In contrast to the minimum capital requirement, the risk-based 
capital standard required by the 1992 Act addresses specific risk 
exposures. This standard determines the amount of capital necessary for 
an Enterprise to withstand adverse credit conditions and large interest 
rate movements simultaneously during a 10-year period, plus an 
additional amount to cover management and operations risk.7 This 
10-year period is referred to as the ``stress period.'' The level of 
capital required under this standard for an Enterprise will reflect 
that Enterprise's specific risk profile.8 This NPR proposes two 
key components of the risk-based capital regulation.
---------------------------------------------------------------------------

    \7\ 1992 Act, section 1361 (12 U.S.C. 4611).
    \8\ For purposes of the risk-based capital standard, the term 
``capital'' means ``total capital'' as defined under section 
1303(18) of the 1992 Act (12 U.S.C. 4502(18)) to mean the sum of the 
following:
    (A) The core capital of the enterprise;
    (B) A general allowance for foreclosure losses, which--
    (i) shall include an allowance for portfolio mortgage losses, an 
allowance for nonreimbursable foreclosure costs on government 
claims, and an allowance for liabilities reflected on the balance 
sheet for the enterprise for estimated foreclosure losses on 
mortgage-backed securities; and
    (ii) shall not include any reserves of the enterprise made or 
held against specific assets.
    (C) Any other amounts from sources of funds available to absorb 
losses incurred by the enterprise, that the Director by regulation 
determines are appropriate to include in determining total capital. 
The term ``core capital'' is defined under section 1303(4) of the 
1992 Act (12 U.S.C. 4502(4)) to mean the sum of the following (as 
determined in accordance with generally accepted accounting 
principles):
    (A) The par or stated value of outstanding common stock.
    (B) The par or stated value of outstanding perpetual, 
noncumulative preferred stock.
    (C) Paid-in capital.
    (D) Retained earnings.
    The core capital of an enterprise shall not include any amounts 
that the enterprise could be required to pay, at the option of 
investors, to retire capital instruments.
---------------------------------------------------------------------------

Credit Losses in the Stress Test

    The 1992 Act requires that the stress test subject each Enterprise 
to very large credit losses on mortgages it owns or guarantees. The 
frequency and severity of those losses must be reasonably related to 
the highest rate of default and severity of mortgage losses experienced 
during a period of at least 2 consecutive years in contiguous areas of 
the United States that together contain at least 5 percent of the total 
U.S. population.9 This provision requires OFHEO to identify a 
``benchmark loss experience,'' which is the default and severity 
behavior of mortgage loans, in a place and time meeting statutory 
requirements, that resulted in the highest loss rate for any such place 
and time.10 In this context, default and severity behavior means 
the frequency, timing, and severity of losses on mortgage loans, given 
the specific characteristics of those loans and the economic 
circumstances affecting those losses.
---------------------------------------------------------------------------

    \9\ 1992 Act, section 1361(a)(1) (12 U.S.C. 4611(a)(1)).
    \10\ In this document, the word ``benchmark,'' when used as an 
adjective, refers to the benchmark loss experience.
---------------------------------------------------------------------------

Interest Rates in the Stress Test

    The 1992 Act prescribes two interest rate risk scenarios, one with 
rates falling and the other with rates rising.11 The 1992 Act 
further describes the path of the 10-year constant maturity Treasury 
(CMT) yield for each scenario, and directs OFHEO to establish the 
yields on Treasury instruments of other maturities in a manner 
reasonably related to historical experience.
---------------------------------------------------------------------------

    \11\ Section 1361(a)(2) (12 U.S.C. 4611(a)(2)).
---------------------------------------------------------------------------

    In the falling rate scenario, the 10-year CMT yield decreases 
during the first year of the stress period, and then remains constant 
at the lesser of: (a) 600 basis points below the average yield during 
the 9 months preceding the stress period or (b) 60 percent of the 
average yield during the 3 years preceding the stress period. The 1992 
Act further limits the decrease in yield to a yield no less than 50 
percent of the average yield in the 9 months preceding the stress 
period.12
---------------------------------------------------------------------------

    \12\ Section 1361(a)(2)(B) (12 U.S.C. 4611(a)(2)(B)).
---------------------------------------------------------------------------

    In the rising rate scenario, the 10-year CMT yield increases during 
the first year of the stress period, and then remains constant at the 
greater of: (a) 600 basis points above the average yield during the 9 
months preceding the stress period or (b) 160 percent of the average 
yield during the 3 years preceding the stress period. The 1992 Act 
further limits the increase in yield to a yield no more than 175 
percent of the average yield over the 9 months preceding the stress 
period.13 The 1992 Act recognizes that interest rates can affect 
credit risk, specifically requiring that credit losses be adjusted for 
a correspondingly higher rate of general price inflation if application 
of the stress test assumes an increase of more than 50 percent in the 
10-year CMT yield.14
---------------------------------------------------------------------------

    \13\ Section 1361(a)(2)(C) (12 U.S.C. 4611(a)(2)(C)).
    \14\ Section 1361(a)(2)(E) (12 U.S.C. 4611(a)(2)(E)).
---------------------------------------------------------------------------

New Business, Other Activities, and Considerations

    The 1992 Act requires an assumption that the Enterprises conduct no 
new business within the stress period, except to fulfill contractual 
commitments to purchase mortgages or issue securities. The 1992 Act 
states that OFHEO may, 4 years after the final risk-based capital 
regulation is issued, incorporate assumptions about additional new 
business conducted during the stress

[[Page 29594]]

period.15 In doing so, OFHEO must take into consideration the 
results of studies conducted by the Congressional Budget Office and the 
Comptroller General of the United States on the advisability and 
appropriate forms of new business assumptions. The 1992 Act requires 
that the studies be completed within the first year after issuance of 
the regulation.
---------------------------------------------------------------------------

    \15\ Section 1361(a)(3)(C) and (D) (12 U.S.C. 4611(a)(3)(C) and 
(D)).
---------------------------------------------------------------------------

    The stress test must take into account distinctions among mortgage 
product types and current loan-to-value (LTV) ratios, and may take into 
account any other factors that the Director deems appropriate. The 1992 
Act does not require a specific adjustment for any of these factors, 
allowing the Director to determine how best to account for them. 
Likewise, the 1992 Act requires the Director to determine losses and 
gains on Enterprise activities not specifically addressed, and all 
other characteristics of the stress period not explicitly defined in 
the 1992 Act, on the basis of available information, in a manner 
consistent with the stress period.16 These stress period 
characteristics could include, among others, mortgage prepayment rates 
and Enterprise funding policies, operating expenses, and dividend 
policies.
---------------------------------------------------------------------------

    \16\ Sections 1361(b) and (d)(2) (12 U.S.C. 4611(b) and (d)(2)).
---------------------------------------------------------------------------

Management and Operations Risk

    To supplement the amount of capital that would permit an Enterprise 
to meet the requirements of the stress test, each Enterprise must 
maintain an additional 30 percent of this amount to protect against 
management and operations risk.17
---------------------------------------------------------------------------

    \17\ 1992 Act, section 1361(c)(2) (12 U.S.C. 4611(c)(2)).
---------------------------------------------------------------------------

Regulation Development

General Approach

    The mission of OFHEO is to protect the taxpayer by ensuring that 
the Enterprises are adequately capitalized and operating in a safe and 
sound manner. The principal objective of the risk-based capital 
standard is to reduce the risk of Enterprise insolvency. However, 
effective capital standards should promote prudent business practices 
and strategies and the maintenance of the financial health necessary to 
fulfill the Enterprises' public purposes. Although the stress test 
produces a single capital requirement, it effectively creates marginal 
capital requirements--incremental requirements for each additional 
dollar of business--for every type of product the Enterprises guarantee 
or hold in portfolio. Marginal capital requirements for mortgages held 
in portfolio will vary depending on the risk, as reflected in the 
stress test, of an Enterprise's funding strategy. These marginal 
capital requirements will have significant bearing on how the 
Enterprises choose to conduct their businesses.
    OFHEO will seek to design the stress test so that the incentives it 
creates closely reflect the relative risks inherent in the Enterprises' 
different activities. To this end, OFHEO will incorporate, to the 
extent feasible, consistent relationships between the economic 
environment of the stress period and the Enterprises' businesses. Doing 
so will require modeling the Enterprises' assets, liabilities, and off-
balance sheet positions at a sufficient level of detail to capture 
important risk characteristics.
    However, as the level of detail of a stress test increases, so does 
its complexity, together with the time and other resources required to 
develop it. There are also practical limits to the number of variables 
that can be modeled from existing data. OFHEO, therefore, seeks to 
establish a level of complexity and realism in the stress test that 
appropriately weighs the associated benefits and costs.
    OFHEO's stress test is composed of a number of components, some 
that correspond to subjects specifically cited in the 1992 Act and 
others that represent the infrastructure that makes the stress test 
operational. Figure 1 illustrates these components and their 
interrelationships. The infrastructure components--database, cashflows, 
and financial reports--are shaded gray. The unshaded components 
implement the specific requirements of the 1992 Act, as well as the 
many other aspects of the stress test that the 1992 Act either requires 
or permits OFHEO to determine.
    Each of the components of the stress test involves one or more 
projects of varying complexity, resource intensity and expected 
duration. The diagram highlights in bold the completed components of 
the stress test that OFHEO proposes and describes in this NPR--the 
benchmark loss experience and a house price index.

BILLING CODE 4220-01-P

[[Page 29595]]

Figure 1
[GRAPHIC] [TIFF OMITTED] TP11JN96.000

BILLING CODE 4220-01-C

[[Page 29596]]

Advance Notice of Proposed Rulemaking

    On February 8, 1995, OFHEO published an ANPR 18 as its first 
step in developing the risk-based capital regulation. The ANPR 
announced OFHEO's intention to develop and publish a risk-based capital 
regulation and solicited public comment on a variety of issues relating 
to that regulation.
---------------------------------------------------------------------------

    \18\ Risk-Based Capital, ANPR, 60 FR 7468.
---------------------------------------------------------------------------

    The comment period for the ANPR ended on May 9, 1995, and was 
extended through June 8, 1995.19 OFHEO received 15 comments on the 
ANPR from a variety of interested parties. Commenters included two 
Executive Branch Departments (Department of Housing and Urban 
Development and Department of Veterans Affairs), one financial 
institution regulatory agency (Office of Thrift Supervision), the 
Enterprises (Fannie Mae and Freddie Mac), four trade groups (Mortgage 
Bankers Association of America, America's Community Bankers, National 
Association of Realtors, and Mortgage Insurance Companies of America), 
two mortgage banking firms (PNC Mortgage Corporation of America and 
Norwest Mortgage, Inc.), one rating agency (Standard and Poor's Ratings 
Group), one thrift institution (World Savings and Loan Association), 
one private mortgage research firm (Mortgage Risk Assessment 
Corporation), and one individual (Professor Anthony Yezer of George 
Washington University).
---------------------------------------------------------------------------

    \19\ Risk-Based Capital, Extension of Public Comment Period for 
ANPR, 60 FR 25174 (May 11, 1995).
---------------------------------------------------------------------------

    The responses to the ANPR ranged from a comment on only one or two 
specific risk-based capital issues to an extensive analysis of every 
question or issue raised. OFHEO has been considering these comments in 
the development of its risk-based capital regulation.

Notice of Proposed Rulemaking

    OFHEO will issue two separate NPRs before issuing a final risk-
based capital regulation. This NPR addresses two key aspects of that 
regulation. The first is OFHEO's methodology for identifying and 
measuring the benchmark loss experience. The benchmark loss experience 
will be the basis for determining credit losses that the Enterprises 
will experience during the stress period. This NPR describes: (1) The 
proposed methodology (definitions, data, and procedures) that is used 
to identify the benchmark loss experience; (2) characteristics of the 
benchmark loss experience that was identified and proposed using this 
methodology; and (3) in general terms, the implications of the 
benchmark loss experience for mortgage losses in the risk-based capital 
test. OFHEO seeks comment on the methodology it used to determine the 
benchmark loss experience.
    In the second key aspect of the regulation addressed in this NPR, 
OFHEO also proposes to use a weighted repeat transactions house price 
index, the HPI produced by OFHEO, rather than the Constant Quality Home 
Price Index (CQHPI), published by the Secretary of Commerce, referenced 
in the 1992 Act, to measure differences in seasoning of single-family 
mortgages in the stress test. The 1992 Act defines ``seasoning'' as the 
change over time in the LTV ratio of a mortgage.20 Such changes 
result from changes in principal balance and changes in the value of 
the property. OFHEO proposes to use the HPI as the basis for estimating 
changes in property values and seeks comment about its choice of index.
---------------------------------------------------------------------------

    \20\ Section 1361(d)(1) (12 U.S.C. 4611(d)(1)). This usage in 
the 1992 Act should not be confused with the usage of the same term 
in the mortgage industry. Within this industry, seasoning is 
synonymous with aging, which has important implications for patterns 
of both prepayments and defaults. See Linda Lowell, Mortgage Pass-
Through Securities, in Handbook of Mortgage-Backed Securities 59, 78 
(F. Fabozzi ed., 3rd ed., Probus 1992) (prepayments); Standard and 
Poor's, Residential Mortgages: Criteria, Statistics, Credit Week, 
Oct. 25, 1993, at 29 (defaults).
---------------------------------------------------------------------------

    At a later date OFHEO will issue a second NPR which will: (1) 
Specify and propose for public comment all of the remaining aspects of 
the risk-based capital stress test, (2) describe how the stress test 
will be used to determine the Enterprises' risk-based capital 
requirements, and (3) respond to all ANPR comments not addressed in 
this NPR. OFHEO will consider comments received in response to both 
NPRs in the final risk-based capital regulation.
    OFHEO decided to publish two NPRs for several reasons. They include 
the complex issues and decisions that OFHEO must address prior to 
completing its proposal for the risk-based capital regulation and the 
challenge of developing the stress test infrastructure. Further, the 
development of the risk-based capital standard comprises multiple 
projects, most of which will not be concluded until later this year. 
Rather than delay in order to present an entire proposal, OFHEO 
believes the public interest is best served by publishing the results 
of completed projects that can be considered independently of the rest 
of the regulation. OFHEO's analysis, which identified the location, 
time and magnitude of the highest mortgage losses, may also be of 
public interest apart from the development of the risk-based capital 
regulation.
    In the sections titled ``Issues, Alternatives Considered, and 
Comments Received,'' this NPR discusses the ANPR comments that related 
directly to the benchmark loss experience and house price index topics. 
There were certain other issues, such as the potential impact of 
improved underwriting standards on credit losses, the application of a 
regional recession to the Enterprises' books of business, and the 
impact of recent loss mitigation programs that were raised by ANPR 
commenters in discussing the credit stress benchmark. OFHEO believes 
that those issues are more appropriately addressed in the second NPR, 
which will discuss how, or whether, to account for these factors in the 
risk-based capital stress test.

Benchmark Loss Experience

Definitions, Data, and Procedures

    OFHEO proposes to use the methodology (definitions, data, and 
procedures) described in this section to identify the benchmark loss 
experience. Alternatives OFHEO considered and the reasons for OFHEO's 
choices are discussed below in the section titled ``Issues, 
Alternatives Considered, and Comments Received.''
1. Definitions
    The 1992 Act requires OFHEO to determine the highest rate of 
default and severity of mortgage losses in contiguous areas containing 
5 percent or more of the U.S. population for a period of 2 or more 
years. OFHEO defined ``contiguous areas'' as all the areas within a 
state or a group of two or more states sharing common borders, and 
interpreted ``year'' to mean the calendar year in which a loan is 
originated (origination year). Thus, OFHEO's proposed methodology is 
designed to identify the combination of states and origination years 
from which mortgages had a higher loss rate than mortgages from any 
other qualifying state/year combination.
    OFHEO defined ``defaulted loans'' as loans that, within 10 years 
following their origination, (1) resulted in pre-foreclosure sale, (2) 
completed foreclosure, (3) resulted in real estate owned (REO), or (4) 
resulted in a credit loss to an Enterprise. For any group of loans, 
OFHEO defined the ``default rate'' as the ratio of the aggregate 
original principal balance of the defaulted loans in the group to the 
aggregate original principal balance of all loans in the

[[Page 29597]]

group. OFHEO defined ``losses'' on defaulted loans in categories 1, 2, 
or 3 above as the difference between: (1) The sum of the principal and 
interest owed when the borrower lost title to the property securing the 
mortgage; REO financing costs 21 through the date of property 
disposition; and cash expenses incurred during the foreclosure process, 
REO holding period, and property liquidation process; and (2) the sum 
of the property sales price and any other liquidation proceeds (except 
those resulting from private mortgage insurance proceeds or other 
third-party credit enhancements). Losses on defaulted loans not in 
categories 1, 2, or 3 above were defined as the amount of the financial 
loss to the Enterprise. For any group of defaulted loans, the 
``severity rate'' was defined as the aggregate losses on those loans 
divided by the aggregate original principal balance of all loans in the 
group. ``Loss rate'' for a group of loans was defined as the product of 
the default rate for those loans and the severity rate for all 
defaulted loans in that group for which loss data are available.
---------------------------------------------------------------------------

    \21\ The financing costs associated with properties acquired 
through foreclosure from the time of foreclosure through property 
disposition were calculated using the average from 1982 through 1992 
of the 12-month Federal Agency constant maturity yield computed by 
Bank of America.
---------------------------------------------------------------------------

2. Data
    OFHEO used the proposed methodology to identify the benchmark loss 
experience using historical loan-level data from each of the two 
Enterprises. OFHEO's analysis was based entirely on fixed-rate 
mortgages or ``FRMs'' (which were defined as conventional, 30-year, 
fixed-rate loans secured by first liens) on ``single-family 
properties'' (which were defined as single-unit, owner-occupied, 
detached properties) that were originated from 1979 to 1993. Detached 
properties were defined as single-family properties excluding 
condominiums, planned urban developments (PUDs), and cooperatives. The 
data included only loans that were purchased by an Enterprise within 12 
months after loan origination and loans for which the Enterprise had no 
recourse to the lender.
    Table 1 lists by year the number of loans, by Enterprise, used in 
the analysis. Fannie Mae's loan totals in most years are lower than 
Freddie Mac's, because Fannie Mae's data set does not include data on 
securitized loans. That Enterprise has not retained such data in a form 
that permits historical analysis.

               Table 1.--Number of Loans Used in Analysis               
------------------------------------------------------------------------
                                     Freddie     Fannie                 
         Origination year              Mac        Mae          Total    
------------------------------------------------------------------------
1979..............................     81,507     66,499         148,006
1980..............................     41,551     23,572          65,123
1981..............................     17,922     41,017          58,939
1982..............................     30,005     39,094          69,099
1983..............................    107,406     33,099         140,505
1984..............................     85,829     14,381         100,210
1985..............................    165,966     32,833         198,799
1986..............................    674,684    111,878         786,562
1987..............................    365,580     63,058         428,638
1988..............................    214,299     55,265         269,564
1989..............................    353,687     72,026         425,713
1990..............................    268,877     71,081         339,958
1991..............................    447,731    120,182         567,913
1992..............................    641,929    203,672         845,601
1993..............................    845,052    313,537       1,158,589
------------------------------------------------------------------------

    OFHEO separately analyzed default and severity data from each 
Enterprise. Default rates were calculated from loan records meeting the 
criteria specified above. Severity rates were calculated from the 
subset of defaulted loans for which loss data were available.22
---------------------------------------------------------------------------

    \22\ Available data did not permit inclusion of loans on which 
credit losses occurred as a result of loan restructurings, interest 
rate buydowns, or pre-foreclosure sales.
---------------------------------------------------------------------------

3. Procedures
    OFHEO calculated each Enterprise's cumulative 10-year default rate 
for a combination of contiguous states and consecutive origination 
years (state/year combination) by grouping all of the Enterprise's 
loans originated in that state/year combination. For origination years 
with less than 10 years of default experience, cumulative-to-date 
default rates were used. The two Enterprise default rates were then 
averaged, yielding an ``average default rate'' for that state/year 
combination.
    An ``average severity rate'' for each state/year combination was 
determined in the same manner as the average default rate; for each 
Enterprise, the aggregate severity rate was first calculated for all 
loans in the relevant state/year combination. The ``loss rate'' for 
each candidate state/year combination examined was calculated by 
multiplying the average default rate for that state/year combination by 
the average severity rate for that combination. The default and 
severity behavior of loans in the candidate with the highest loss rate 
constitutes the benchmark loss experience.

Characterization of the Benchmark Loss Experience

    To identify the state/year combination with the highest loss rate, 
OFHEO examined individual state data on defaults and severity for each 
Enterprise from 1979 through 1985. Based on that examination, OFHEO 
selected more than 250 potential benchmark areas with at least 5 
percent of the U.S. population that appeared to have unusually high 
loss rates for periods of 2 or more consecutive origination years. 
23 For each potential benchmark area, OFHEO calculated loss rates 
for each consecutive combination of 2-, 3-, and 4-origination years 
during the time span examined, making a total of nearly 4,000 candidate 
state/year combinations.
---------------------------------------------------------------------------

    \23\ These combinations of states and origination years are 
referred to as ``candidate state/year combinations'' or 
``candidates.''

---------------------------------------------------------------------------

[[Page 29598]]

    OFHEO also analyzed possible candidate state/year combinations that 
involved mortgage origination years with less than 10 years of loss 
experience (1986 through 1993), and compared their cumulative-to-date 
loss rates with comparable cumulative loss rates for candidate state/
year combinations involving earlier mortgage originations. None of the 
candidates involving recent mortgage originations had cumulative loss 
rates exceeding those of candidates including 10 years of loan 
histories.
    Using the proposed methodology, OFHEO identified the candidate with 
the highest loss rate. OFHEO will monitor new loss data for loans 
originated in more recent years. If OFHEO determines at a future time 
that there is a more recent candidate with a higher loss rate than the 
one described below, OFHEO may establish a new benchmark loss 
experience.
    Table 2 shows some of the principal characteristics of the 
benchmark loss experience identified using the proposed procedures 
described above.

                  Table 2.-- Benchmark Loss Experience                  
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
States....................................  Arkansas, Louisiana,        
                                             Mississippi, and Oklahoma  
Percentage of U.S. Population.*  .........  5.3%                        
Origination Years.........................  1983 and 1984               
Loss Rate.................................  9.4%                        
Average 10-Year Default Rate..............  14.9%                       
Average 10-Year Severity Rate.............  63.3%                       
------------------------------------------------------------------------
* Based on the percentage of 1985 U.S. population as estimated by the   
  Bureau of the Census.                                                 

    Table 3 describes the aggregate data for each Enterprise used in 
calculating the rates in Table 2. Table 3 also shows each Enterprise's 
default and severity rates. A ranking of results for the 500 candidates 
with the highest loss rates appears in the supplementary table at the 
end of the section titled ``Benchmark Loss Experience.''

    Table 3.--Data on Loans Determinnig the Benchmark Loss Experience   
------------------------------------------------------------------------
                                                Freddie Mac   Fannie Mae
------------------------------------------------------------------------
Original Balance of All Loans used in Default                           
 Rate Analysis (000s).........................     $316,930     $242,296
Original Balance of Defaulted Loans used in                             
 Default Rate Analysis (000s).................      $35,742      $44,910
Default Rate..................................       11.28%       18.54%
Original Balance of Defaulted Loans used in                             
 Severity Rate Analysis (000s)................      $14,107      $30,749
Losses on Defaulted Loans used in Severity                              
 Rate Analysis (000s).........................       $8,597      $20,166
Severity Rate.................................       60.94%       65.58%
------------------------------------------------------------------------

    Some comparisons with other loss experiences help put these results 
in perspective. Texas loans originated in the early 1980s are sometimes 
considered a reference point for high loss experiences. Using the 
methodology and data to identify the proposed benchmark loss 
experience, the worst loss rate for Texas was 7.3 percent for loans 
originated in 1982 and 1983. Loss rates within the state were very 
uneven, however. In the 2-digit ZIP Code including Houston, Beaumont, 
and Bryan (77xxx), the loss rate for those years was 11.0 percent. 
Similarly, in the El Paso and West Texas area (79xxx), the loss rate 
was 9.8 percent.
    The loss rate of benchmark loans is much higher than a normal or 
typical rate. The aggregate loss rate for the contiguous 48 states and 
the District of Columbia for all origination years from 1979 through 
1985 was 2.1 percent, which is less than one-quarter of the rate for 
benchmark loans. The benchmark loss experience can also be compared 
with Federal Housing Administration (FHA) experience. The 10-year 
cumulative default rate for FHA loans originated in all states and the 
District of Columbia in 1981 was 19.1 percent, more than one-quarter 
higher than the average default rate of the benchmark loss 
experience.24
---------------------------------------------------------------------------

    \24\ An Actuarial Review for Fiscal Year 1994 of the FHA's 
Mutual Mortgage Insurance Fund: Final Report, Appendix F, May 8, 
1995.
---------------------------------------------------------------------------

    The LTV ratios of loans are good indicators of the likelihood of 
default and the severity of losses on defaulted loans. Table 4 shows 
average default, severity, and loss rates from the benchmark loss 
experience. These rates further characterize the benchmark loss 
experience.25
---------------------------------------------------------------------------

    \25\ Losses experienced by the Enterprises on loans with LTV 
ratios of more than 80 percent were reduced considerably from the 
loss rates shown in the table by proceeds of mortgage insurance. 
Overall, mortgage insurance proceeds offset more than one-quarter of 
the losses on benchmark loans. See discussion of mortgage insurance 
in the stress test in the section ``Implications of the Benchmark 
Loss Experience for the Stress Test'' below.

Table 4.--Default, Severity, and Loss Rates of Benchmark Loans by LTV at
                              Origination*                              
------------------------------------------------------------------------
                                              Average   Average         
                  LTV range                   default  severity    Loss 
                                                rate     rate      rate 
------------------------------------------------------------------------
60%..............................     2.2%     43.5%     1.0%
>60%, 70%........................     3.5%     46.2%     1.6%
>70%, 75%........................     7.9%     50.1%     3.9%
>75 80...........................     9.4%     58.9%     5.5%
>80%, 85%........................    12.0%     55.0%     6.6%
>85%, 90%........................    17.7%     60.2%    10.7%
>90%........................................    26.4%     69.0%    18.2%
------------------------------------------------------------------------
* In addition to the benchmark loans classified by LTV range to produce 
  these results, a large portion (roughly half) of the loans provided by
  one Enterprise have no LTV information available. The average default 
  rate on those loans was 12.2 percent.                                 

    To place these rates in a broader context, they can be compared 
with the loss coverage requirements established by the rating agencies 
for the rating of securitized mortgage pools that are not guaranteed by 
the Enterprises. To receive a given rating, the security structure must 
incorporate protection against credit losses, with higher ratings 
requiring greater loss protection. Each rating agency has its own 
methodology for determining loss coverage requirements (the required 
loss protection as a percentage of the total loan principal at the time 
a pool is formed), but all are based in some way on stress tests or 
default models calibrated to various severe historical episodes. 
Different loss rates have

[[Page 29599]]

become associated in the industry with different ratings, which in turn 
have been associated with hypothetical or actual historical experiences 
of varying severity by the rating agencies in their publications.
    The rating agency loss coverage requirements are a relevant 
industry point of reference from which to gauge the mortgage credit 
losses of the benchmark loss experience. A rating agency's loss 
coverage requirement represents a projected cumulative loss experience 
of a fixed pool of mortgage loans. Once the loans in a fixed pool are 
identified, none is replaced and no additional loans are added to the 
pool; the pool dwindles over time as loans mature, prepay, or default. 
The benchmark loss experience is, in effect, the average experience of 
two fixed pools, one for each Enterprise.
    Four rating agencies are active in the rating of mortgage pools: 
Standard and Poor's Ratings Group (S&P), Moody's Investors Service 
(Moody's), Fitch Investors Service, Inc. (Fitch), and Duff & Phelps 
Credit Rating Co. (Duff & Phelps). Although their methodologies differ, 
they are sufficiently similar to permit a comparison of the benchmark 
results with each of the four rating scales. In all cases, the 
published ``base case'' loss coverage requirements apply to a large, 
nationally diverse pool of good-quality, newly-originated, 30-year, 
fixed-rate loans on owner-occupied, single-family dwellings; and the 
loss coverage requirements vary based on the distribution of LTV ratios 
in the pool.
    For purposes of comparison, Table 5 shows the required loss 
coverage requirements, by rating agency and rating, for a hypothetical 
pool of newly-originated FRMs 26 with a given distribution of LTV 
ratios. These coverage requirements are indicative of rating agency 
requirements derived from agency publications. Requirements for actual 
pools are adjusted to take into account a variety of factors other than 
LTV ratios, such as different mortgage products, underwriting 
standards, servicing practices, and regional economic considerations.
---------------------------------------------------------------------------

    \26\ See issue 2. ``Data'' under section ``Definitions, Data, 
and Procedures'' above.
---------------------------------------------------------------------------

    Applying the LTV-specific loss rates of the benchmark loss 
experience (shown in Table 4) to a pool with the hypothetical LTV 
distribution shown in the note to Table 5 yields an overall loss rate 
of 6.2 percent, a rate roughly comparable to the loss coverage 
requirements for double A rated securities backed by such a pool.

Table 5.-- Loss Coverage Requirements For a Pool With a Hypothetical LTV
            Distribution, by Rating Level and Rating Agency*            
------------------------------------------------------------------------
                                                                  Duff &
            Rating level                S&P    Moody's   Fitch    Phelps
------------------------------------------------------------------------
Triple A............................     9.2%     n.a.     9.1%     8.0%
Double A............................     5.7%   **7.0%     6.0%     4.9%
Single A............................     4.1%     n.a.     n.a.     2.7%
------------------------------------------------------------------------
n.a. = not available.                                                   

Weighted Loss Rate, Benchmark Loss Experience, Using the Same 
Hypothetical LTV Distribution--6.2%
    * Derived by OFHEO from numerical requirements published by the 
rating agencies, for a large, nationally diverse pool of newly-
originated, single-family, 30-year, fixed-rate mortgages with LTV 
ratios of loans distributed as follows:

------------------------------------------------------------------------
                                                                Percent 
                          LTV range                             of loans
                                                                in pool 
------------------------------------------------------------------------
0%60%.........................................         15
60%70%........................................         15
70%75%........................................         15
75%80%........................................         15
80%85%........................................         15
85%90%........................................         15
90%95%........................................         10
------------------------------------------------------------------------

Loss coverage requirements for specific pools may reflect many pool 
characteristics other than LTV distribution. In this table, Fitch 
coverage rates are based on medians of individual Metropolitan 
Statistical Areas requirements; Moody's and Duff & Phelps rates are 
based on rates for mortgages with intermediate risk characteristics 
(those that receive a risk factor of one). For the underlying LTV-
specific requirements and for further details, see S&P, Residential 
Mortgages: Criteria, Statistics, Credit Week, Oct. 25, 1993; 
Moody's, Moody's Approach to Rating Residential Mortgage Pass-
Throughs, Structured Finance Research and Commentary: Special Report 
(1995); Fitch, Fitch Mortgage Default Model, Fitch Research, June 
28, 1993; and Duff & Phelps Residential Mortgage-Backed Securities 
Group, The Rating of Residential Mortgage-Backed Securities, Oct. 
1995.
    ** Moody's has informed OFHEO that its current practice differs 
from that described in its 1991 publication. The coverage 
requirement for ``AA'' rating, consistent with the assumptions of 
the table, now would be 5.6%.

Implications of the Benchmark Loss Experience for the Stress Test

    The stress test subjects the Enterprises to severe credit losses 
and extreme interest rate changes. The benchmark loss experience will 
be the basis for determining mortgage credit losses that the 
Enterprises will experience during the stress period. Although the 
benchmark loss experience relates most directly to single-family 
FRMs,27 losses on other mortgage assets and guarantees also will 
be related to the benchmark experience in the stress test in a manner 
that reflects the different risk characteristics of other mortgages 
compared with those of single-family FRMs.
---------------------------------------------------------------------------

    \27\ The term ``single-family FRM'' is used to mean an FRM 
secured by a single-family property.
---------------------------------------------------------------------------

    The projection of credit losses on an Enterprise's loans in the 
stress period will not involve direct application of the loss rate of 
the benchmark loss experience. That experience reflects the specific 
characteristics of the benchmark loans and the economic circumstances 
affecting the default and severity behavior of those loans. The 
characteristics of an Enterprise's loans during any application of the 
stress test (stress test loans) will differ from those of benchmark 
loans in a number of important ways. In addition to differences in 
mortgage product type,28 differences in the mix of LTV ratios may 
be especially important, and OFHEO will design the stress test to take 
account of them. These differences in LTV ratios will reflect 
differences between the original LTVs of benchmark loans and those of 
an Enterprise's stress test loans. LTV ratios of stress test loans also 
will differ from those of benchmark

[[Page 29600]]

loans because most stress test loans will not be newly-originated 
loans. The LTV ratios of stress test loans will reflect house price 
changes subsequent to origination. Many will have lower LTV ratios than 
they originally did, but some will be higher, and a few will have LTV 
ratios that are higher than the highest original LTV ratios of 
benchmark loans. OFHEO is also considering whether and in what manner 
to incorporate the effect of a loan's age on the likelihood and timing 
of default in the stress test. Loan age is another factor that will 
distinguish some stress test loans from those in the benchmark loss 
experience, because some of the stress test loans will be older than 
the oldest benchmark loans.
---------------------------------------------------------------------------

    \28\ The 1992 Act, section 1361(d)(2), defines ``type of 
mortgage product'' to mean a classification of mortgages based upon 
characteristics that include: (1) the type of property securing the 
mortgages (e.g., single-family, PUD, etc.), (2) the interest rate 
type (fixed, adjustable, balloon, etc.), (3) the priority of the 
liens securing the mortgages, and (4) the terms of the mortgages (15 
years, 30 years, etc.) (12 U.S.C. 4611(d)(2)).
---------------------------------------------------------------------------

    To incorporate properly the effects of differences in LTV ratios, 
age of loans, and mortgage product type in the stress test, OFHEO is 
examining the effects of these factors on the default and severity 
behavior of a broader sample of loans than those of the benchmark loss 
experience.
    Differences between the economic environment of the stress test and 
the environment affecting benchmark loans might also be expected to 
affect loan performance. The levels and patterns of change in interest 
rates will differ considerably among alternative interest rate 
scenarios and will not match the interest rate history of the time 
period affecting benchmark loans. Such differences in interest rates 
might reasonably be associated with differences in prepayments and 
house prices, which could have a significant impact on credit losses. 
OFHEO is considering whether or to what extent to take into account in 
the stress test the effect of interest rates on prepayments and house 
prices. In doing so, the stress test must incorporate the statutory 
requirement that the stress test take into account the effect of a 
correspondingly higher rate of general price inflation, if the 10-year 
CMT yield is assumed to increase more than 50 percent during the stress 
period.29
---------------------------------------------------------------------------

    \29\ 1992 Act, section 1361(a)(2)(E) (12 U.S.C. 4611(a)(2)(E)).
---------------------------------------------------------------------------

    The purpose of incorporating the effects of some or all of these 
factors (and possibly others) is to make the stress test better reflect 
the risks, under stress test conditions, of loans owned or guaranteed 
by the Enterprises. OFHEO plans to design the test so that losses on 
loans with characteristics matching those of the benchmark loans would 
be projected, under economic circumstances matching those affecting the 
benchmark loans, to occur at the same rate of default and severity as 
the benchmark loans. However, as discussed above, projected credit 
losses will differ from benchmark losses to reflect key differences in 
risk affecting each Enterprise's stress test loans. The stress test 
will also take into account, for example, offsetting receipts from 
mortgage insurance, recourse, and other credit enhancements. OFHEO will 
present the specific methodology for determining credit losses in the 
stress test in the second NPR.

Issues, Alternatives Considered, and Comments Received

    OFHEO encountered a number of methodological issues in identifying 
the benchmark loss experience. Many of these issues were mentioned 
specifically in the ANPR. In this section, OFHEO addresses the issues, 
discusses alternative methodologies it considered, and responds to 
related comments received on the ANPR.
    OFHEO chose procedures best designed to identify the worst loss 
experience (meeting statutory time, contiguity, and population 
requirements) for mortgage loans with characteristics similar to those 
purchased or guaranteed by both Enterprises. In choosing among 
alternatives, OFHEO sought approaches that were most appropriate for 
setting capital standards. Because capital standards should be clear 
and predictable, OFHEO favored straightforward approaches over those 
that might require needlessly complex computations or frequent 
adjustments or changes to the benchmark loss experience. Wherever 
appropriate for setting capital standards, OFHEO resolved issues in 
ways that were consistent with analytical practices within or related 
to the residential mortgage industry. In particular, OFHEO looked to 
the practices of credit rating agencies and how the rating agencies 
analyze the credit risk of securitized mortgage pools, as credit rating 
agency practices often are published and readily available. OFHEO also 
considered practices of the Enterprises, mortgage insurers, and, as 
appropriate, the regulators of portfolio lenders. OFHEO also favored 
approaches that would make best use of the data available for analysis.
1. Data Sources Used to Define the Benchmark Loss Experience
    The ANPR requested comment on whether OFHEO should use data from 
sources other than the Enterprises to identify the benchmark loss 
experience. After considering the issue, OFHEO is proposing to use only 
Enterprise data. OFHEO has concluded that the two Enterprise data sets 
are the most relevant sources currently available for determining a 
benchmark loss experience for use in a risk-based capital stress test. 
The choice is consistent with the general practice of banking and 
thrift industry regulators and the credit rating agencies, which use 
data on the loss experience of the relevant industry in determining 
capital adequacy.
    Non-Enterprise mortgage default and severity data are necessarily 
less representative of the experience of loans owned or guaranteed by 
these large secondary mortgage market companies. FHA data, for example, 
reflect the very different market focus of that agency. A large portion 
of FHA loans would not have met Enterprise underwriting guidelines, and 
would, therefore, be expected to exhibit risk characteristics different 
from those of the loans that the Enterprises purchased or guaranteed.
    OFHEO was in a unique position to obtain and analyze extensive data 
on the loss experience of individual Enterprise loans. This data 
included information on a large portion of loans originated and 
purchased since 1979. Severity data were available for a majority of 
the defaulted loans, which was sufficient for OFHEO's analysis.
    The majority of comment letters supported the exclusive use of 
Enterprise data. One commenter, America's Community Bankers (ACB), 
however, suggested that it would be inconsistent with the 1992 Act to 
rely solely on Enterprise data if, as a result, a relatively recent 
period of severe losses might be overlooked. The same commenter stated 
that ``[t]he Federal Housing Administration and credit bureau data that 
are identified as supplementary sources [in the ANPR] should also be 
accompanied by private mortgage insurance data.'' For the reasons cited 
above, OFHEO believes that the exclusive use of Enterprise data to 
identify the benchmark loss experience is the most reasonable approach. 
OFHEO agrees that if using only Enterprise data would cause a recent 
period of severe losses to be overlooked, other data should be included 
in the analysis. However, the quantity and detail of the Enterprise 
data are such that those data reflect losses in recent periods as well 
as or better than data from any other sources.
2. Loan and Property Types Included in the Benchmark Analysis
    OFHEO proposes to use single-family FRMs in the benchmark analysis. 
The analysis excludes other loan types, such as adjustable-rate and 
balloon mortgages and loans secured by other property

[[Page 29601]]

types such as multi-unit and 2- to 4-unit structures, condominiums, 
PUDs, or cooperatives.
    OFHEO believes it is appropriate to identify the benchmark loss 
experience on the basis of single-family FRMs because of the 
homogeneity of these mortgages and their preponderance in the 
Enterprises' portfolios and mortgage-backed securities, especially in 
the early 1980s. Data on these mortgages are available from both 
Enterprises in all regions for loans originated in 1979 and 
subsequently. Single-family FRMs accounted for over three-quarters of 
the total dollar volume of Enterprise mortgages purchased between 1981 
and 1985 and nearly two-thirds of mortgages purchased between 1986 and 
1990.30
---------------------------------------------------------------------------

    \30\ Congressional Budget Office, Controlling the Risks Of 
Government-Sponsored Enterprises, at 125 (April 1991).
---------------------------------------------------------------------------

    OFHEO's proposed approach is supported by the legislative history 
of the 1992 Act. The House and Senate Committee reports both suggested 
that OFHEO should rely on single-family FRMs in identifying the 
benchmark loss experience. The House report explained that:

    Conventional, 30-year, fixed-rate, single-family mortgages 
account for about two-thirds of the mortgages purchased by Fannie 
Mae and Freddie Mac in each year. The most reliable loan performance 
data the enterprises possess pertain to such loans.31

    \31\ Government-Sponsored Enterprises Financial Safety and 
Soundness Act of 1991, H.R. Rep. No. 206, 102d Cong., 1st Sess. 66 
(1991).
---------------------------------------------------------------------------

    The House report also stated that:

    The bill would require the Director to measure rates of default 
in a manner that was reasonably related to prevailing industry 
practice.
    Prevailing industry practice at this time, as reflected by the 
practices of Fannie Mae, Freddie Mac, mortgage insurers and rating 
agencies, is to utilize estimated lifetime default rates of a group 
of mortgages with similar characteristics, e.g. product type and 
loan-to-value ratio, originated over a specific time period.32

    \32\ Id.
---------------------------------------------------------------------------

    The Senate report counseled that:

    The Director is only required to use data from the Benchmark 
origination years on rates of default and loss severity for the most 
common type or types of mortgages held or guaranteed during that 
period. Loss rates on other types of mortgages should be related to 
loss rates on the ``standard'' mortgage types according to 
prevailing practice * * *.33

    \33\ Federal Housing Enterprises Regulatory Reform Act of 1992, 
S. Rep. No. 282, 102d Cong., 2d Sess. 21 (1992).
---------------------------------------------------------------------------

    The use of data on single-family FRMs from a historically stressful 
period to establish a standard for evaluating potential future credit 
losses is also consistent with credit rating agency practice. For 
example, single-family FRMs constitute the benchmark mortgage product 
type for the four rating agencies.34  Lack of data on other 
mortgage product types is likely a major reason for this practice. As 
noted above, the volume of Enterprise loans secured by other mortgage 
product types during the early and middle 1980s was very small relative 
to the volume of single-family FRMs purchased or guaranteed by the 
Enterprises. These small sample sizes were an additional factor in 
OFHEO's decision not to include different mortgage types in its 
analysis. For purposes of the stress test, OFHEO will estimate the risk 
characteristics (and, ultimately, project the loss rates) of other 
Enterprise mortgage product types using all relevant historical data. 
This part of the stress test analysis will be discussed in detail in 
the second NPR.
---------------------------------------------------------------------------

    \34\ Fitch and Moody's note that they reduce the risk of 15-year 
mortgages in their mortgage default models, implying that single-
family FRMs are the standard. See, e.g., Fitch, Fitch Mortgage 
Default Model, Fitch Research, June 28, 1993, at 9; and Moody's, 
Moody's Approach to Rating Residential Mortgage Pass-Throughs, 
Structured Finance Research and Commentary: Special Report (1995), 
at 10-14. However, S&P and Duff & Phelps explicitly note that 30-
year FRMs are the standard. S&P, Residential Mortgages: Criteria, 
Statistics, Credit Week, Oct. 25, 1993, at 20; and Duff & Phelps, 
The Rating of Residential Mortgage-Backed Securities, Oct. 1995, at 
15.
---------------------------------------------------------------------------

    All of the ANPR comments that discussed the issue of which mortgage 
product type(s) to include in the benchmark analysis were consistent 
with OFHEO's general approach of analyzing only the most common 
mortgage product types purchased by the Enterprises. While agreeing 
with OFHEO's general approach, Fannie Mae suggested a minor variation: 
to base the single benchmark loss experience on ``fixed rate, 30-year, 
conventional mortgages on single-family, owner-occupied, primary 
residences,'' thus implicitly including condominiums, PUDs, and 
cooperatives. OFHEO considered this option, but concluded that loans 
secured by condominiums, PUDs, and cooperatives should not be included, 
because they are significantly different types of properties and 
involve fees and contractual agreements with third parties that may 
cause the default and severity experience of the loans to differ from 
that of single-family mortgages. OFHEO decided not to include 
multifamily loans in the identification of the benchmark loss 
experience because, as highlighted in the ANPR and reinforced by many 
comments, multifamily loans and the properties underlying these loans 
present significantly different credit, market, and institutional risks 
to the Enterprises than do single-family mortgages.
3. Determination of a Single Benchmark State/Origination Year 
Combination or a Separate Area and Period for Each Enterprise
    The ANPR also suggested that OFHEO might combine, in some fashion, 
data from the two Enterprises before determining the state/origination 
year combination with the worst joint loss experience, or, 
alternatively, that OFHEO might determine the worst experience for each 
Enterprise separately. If the latter approach were adopted, the ANPR 
suggested the possibility of using a simple or weighted average of 
default rates to derive the single benchmark loss experience to apply 
to both Enterprises in the stress test.
    OFHEO is proposing to identify the benchmark loss experience on the 
basis of a single benchmark state/origination year combination 
representing the worst combined loss experience on mortgages owned or 
guaranteed by the Enterprises. All the comments were consistent with 
this proposal.
4. Role of Severity Data in Identifying the Benchmark Loss Experience
    The ANPR suggested that, as an alternative to identifying a 
specific area and time period that experienced the highest overall loss 
rate, OFHEO might need to use severity data from different sources, 
time periods, or areas than those used to determine the average default 
rates in the benchmark loss experience. OFHEO was concerned at the time 
the ANPR was published that the quality or quantity of severity data 
might be inadequate to derive benchmark loss rates. Subsequently, OFHEO 
obtained severity data from the Enterprises that were adequate to 
determine severity experience from all potential benchmark areas and 
origination years. Severity data were available for 58% of defaulted 
loans and in higher percentages for later origination years. OFHEO, 
therefore, proposes to identify the benchmark loss experience on the 
basis of the worst loss experience of Enterprise loans, rather than 
only the worst default experience. This approach is consistent with all 
comments on the issue.
    Some commenters apparently concluded that OFHEO was considering 
identifying separately the states and origination years with the 
highest default rate and the states and origination years with the 
highest severity rate, and then combining them

[[Page 29602]]

to establish the overall benchmark loss rates. OFHEO did not intend to 
suggest such a synthesis of two different historical experiences. In 
OFHEO's view, such an approach would be inconsistent with the 
provisions of the 1992 Act and its legislative history; first, because 
it could result in an overall benchmark loss rate not ``reasonably 
related'' to any actual historical loss experience and, second, because 
the House and Senate reports consistently describe ``experience'' in 
the singular.35
---------------------------------------------------------------------------

    \35\ See H.R. Rep. No. 206, at 65-6, and S. Rep. No. 282, at 21.
---------------------------------------------------------------------------

5. Definition of ``Default Rate''
    a. In General. OFHEO defined the default rate of a group of loans 
as the ratio of the aggregate original principal balance of the 
defaulted loans in the group to the aggregate original principal 
balance of all loans in the group. Although default rates are sometimes 
defined as the number of defaulted loans divided by the number of loans 
in the group, the dollar values more accurately describe the economic 
impact if large and small loans default at different rates.
    The Enterprise data used in the default analysis did not include 
balances at the date of last paid installment (LPI). In some 
circumstances, the best measurement of default rates using dollar 
values would be based upon principal balances at the LPI date, rather 
than the original principal balance. However, that is not so in this 
case, because the ultimate focus of the analysis was loss rates, not 
default rates, and loss rates are a product of default and severity 
rates.36
---------------------------------------------------------------------------

    \36\ See issue 6. ``Definitions of ``Severity Rate'' and 
``Losses'.''
---------------------------------------------------------------------------

    b. Interpretation of ``Years''. OFHEO considered two approaches to 
analyzing default rates, one based upon origination years (origination 
year approach) and one based upon exposure years (exposure year 
approach). Under an origination year approach, mortgage loans 
originated during specified years are tracked as a group until maturity 
or some intermediate term. Default rates for that group of loans over 
the specified term are expressed as the cumulative defaulted loan 
balances divided by the sum of the original balances of all the loans 
in the group. Exposure year default rates, in contrast, are calculated 
for ``exposure years,'' which are the years in which the loans are 
subject to default. Exposure year default rates are expressed as the 
aggregate balances on all loans (from all origination years) that 
defaulted during a given period of consecutive exposure years divided 
by the unpaid balances of all loans active at the start of that period.
    OFHEO proposes to identify the benchmark loss experience using an 
origination year approach. OFHEO favors the origination year standard 
because (1) it is consistent with industry practice; (2) it is the 
approach that was anticipated in the legislative history; and (3) using 
an exposure year approach would have required annual information on 
unpaid balances, which was not included in the Enterprises'' data on 
individual loans and would have required reliance on estimates.
    Industry practice is to measure default and loss rates based on 
origination year data. Moody's Residential Mortgage-Backed Securities 
Credit Indices are broken out by origination year, as are S&P's 
surveillance reviews.37 The Congressional Committees that 
considered the 1992 Act understood that prevailing industry practice 
was to measure rates of loss based on origination years. The House 
report states: ``Prevailing industry practice at this time, as 
reflected by the practices of Fannie Mae, Freddie Mac, mortgage 
insurers and rating agencies, is to utilize estimated lifetime default 
rates of a group of mortgages with similar characteristics, e.g. 
product type and loan-to-value ratio, originated over a specific time 
period.'' 38 Similarly, the Senate report provides: ``Currently, 
the prevailing practice in the Committee's judgment is to examine 
losses by origination year, that is, losses on mortgages purchased by 
the [Enterprises] in a particular year.'' 39 Although loans 
purchased in a particular year include some loans that were not 
originated in that year, this recommendation is consistent with OFHEO's 
general approach.
---------------------------------------------------------------------------

    \37\ See, e.g., S&P, Study Tracks MBS Loss and Default 
Experience, Credit Week, June 19, 1995 (credit rating agency 
practice); Moody;s, Residential Mortgage-Backed Securities Credit 
Indices Update: Are Slipping ARM Delinquencies Another Signal of 
Consumer Debt Problems?, Structured Finance Credit Index, Dec. 15, 
1995 (same). See also Mortgage Information Corp., The Market Pulse, 
Sept. 1995 (securities industry practice).
    \38\ H.R. Rep. No. 206, at 66.
    \39\ S. Rep. No. 282, at 20.
---------------------------------------------------------------------------

    Most commenters, including the Department of Veterans Affairs, both 
Enterprises, and two trade associations, the Mortgage Bankers 
Association of America (MBA) and the National Associat

FR Doc. 96-14496 Office of Federal Housing Enterprise Oversight; Risk-Based Capital

ion of Realtors 
(NAR), favored the origination year approach. These commenters viewed 
that approach as the most consistent with industry practice. For 
instance, MBA noted that, because of its predictive value, the 
origination year approach is used by Fannie Mae, Freddie Mac, and the 
lending industry.
    Without stating a clear preference, HUD stated that an exposure 
year approach would be more appropriate for a stress test that assumes 
no new business. The comment may reflect a view that the loss 
experience of a mixture of old and new loans would be a more 
appropriate benchmark experience than the experience of newly-
originated loans, because the Enterprises would be purchasing 
relatively few new loans during the stress period. ACB was the only 
commenter clearly preferring the exposure year approach. Its suggestion 
that an exposure year approach dovetails better with what it described 
as the ``foreclosure/disposition orientation'' of the 1992 Act appears 
to be based on similar reasoning. OFHEO believes that HUD's and ACB's 
concern will be dealt with in the stress test, which will take into 
account seasoning, age, amortization, and other factors that are found 
to affect losses on loans. Thus, the stress test will not necessarily 
project the same loss rate for two loans of different ages that are 
otherwise similar.
    c. Definition of ``Defaulted Loans''. OFHEO defined ``defaulted 
loans'' as loans that, within 10 years following their origination, (1) 
resulted in pre-foreclosure sale, (2) completed foreclosure, (3) 
resulted in REO, or (4) resulted in a credit loss to an Enterprise. The 
Enterprises'' data provided little information on loss mitigation 
techniques such as sales prior to completion of foreclosure, loan 
restructurings, or interest rate buydowns. Although one Enterprise's 
data did identify loans that resulted in pre-foreclosure sales, it was 
not possible to include any other loans that were subject to loss 
mitigation efforts unless they resulted in a completed foreclosure or 
in REO. Data sufficient to determine loans on which these techniques 
were applied and the amounts of loss involved exist only for very 
recent years.
    OFHEO's definition only includes defaults that occurred within 10 
years after origination, which facilitated comparisons of data from 
different origination years. Although OFHEO could have estimated 
lifetime default rates for all groups of loans, that approach would 
have required assumptions and extrapolations. It would be unlikely to 
yield a different benchmark experience because the data indicate that 
the vast majority of mortgage defaults occur within 10 years of 
origination. Further, a 10-year rate is

[[Page 29603]]

consistent with the 10-year time span of the stress test.
    All commenters who addressed the issue supported OFHEO's general 
approach to defining default. OFHEO agreed with the thrust of all these 
comments, which were concerned with avoiding counting as ``defaults'' 
loans that are brought current or rehabilitated without loss to the 
Enterprises.
    ACB would have adjusted OFHEO's definition of default to account 
for the effects of loss mitigation, because foreclosure is not the only 
outcome under which the Enterprises may suffer loss. OFHEO agrees with 
this comment. However, as noted above, comprehensive information on 
most types of loss mitigation is unavailable in the historical data 
available to OFHEO.
6. Definitions of ``Severity Rate'' and ``Losses''
    For any group of defaulted loans, the ``severity rate'' was defined 
as the aggregate losses on those loans divided by the aggregate 
original principal balance of all loans in the group. OFHEO defined 
``losses'' on defaulted loans in categories 1, 2, or 3 of the 
definition of defaulted loans as the difference between: (1) The sum of 
the principal and interest owed when the borrower lost title to the 
property securing the mortgage; REO financing costs 40 through the 
date of property disposition; and cash expenses incurred during the 
foreclosure process, REO holding period, and property liquidation 
process; and (2) the sum of the property sales price and any other 
liquidation proceeds (except those resulting from private mortgage 
insurance proceeds or other third-party credit enhancements). Losses on 
defaulted loans not in categories 1, 2, or 3 of the definition were 
defined as the amount of the financial loss to the Enterprise.
---------------------------------------------------------------------------

    \40\ The financing costs associated with properties acquired 
through foreclosure from the time of foreclosure through property 
disposition were calculated using the average from 1982 through 1992 
of the 12-month Federal Agency constant maturity yield computed by 
Bank of America.
---------------------------------------------------------------------------

    This definition is consistent with industry practice. Duff & 
Phelps, Moody's, and S&P include all of these items in their respective 
definitions of severity. Proceeds from mortgage insurance are sometimes 
included; however, as discussed below, OFHEO did not include mortgage 
insurance proceeds for purposes of determining the benchmark loss 
experience.41 Some accounting definitions of loss do not include 
lost interest on the loans or REO financing costs because these costs 
are reflected elsewhere in a company's financial statements. OFHEO 
determined that its definition better reflects the economic losses on 
defaulted loans and is, therefore, more appropriate.
---------------------------------------------------------------------------

    \41\ See, e.g., Duff & Phelps, The Rating of Residential 
Mortgage-Backed Securities, Oct. 1995, at 18; Moody's, Moody's 
Approach to Rating Residential Mortgage Pass-Throughs, Structured 
Finance Research and Commentary: Special Report (1995), at 9, 13; 
and S&P, Residential Mortgages: Criteria, Statistics, Credit Week, 
Oct. 25, 1993, at 18.
---------------------------------------------------------------------------

    Consistent with the calculation of default rate discussed above, 
OFHEO calculated severity rate as a percentage of the original balance, 
rather than the balance at the LPI date of the defaulted loans. Loss 
rates are the product of the default and severity rates. Because the 
balances of defaulted loans appear in the numerator of default rate 
calculations and in the denominator of severity rate calculations, 
errors in measuring those balances will tend to be offsetting when the 
two rates are multiplied in the calculation of loss rates. If it were 
possible, it would have been more accurate to use balances of defaulted 
loans at LPI date for both rates, but using original balances for both 
should have little effect on loss rates.
    Fannie Mae's ANPR comment suggested that OFHEO should define 
``losses'' to incorporate the proceeds of mortgage insurance. OFHEO is 
proposing to exclude the impact of mortgage insurance and other third-
party credit enhancements from consideration in identifying the 
benchmark loss experience because the 1992 Act requires OFHEO to 
identify the highest credit losses on mortgages, not the highest net 
credit losses to the Enterprises. Moreover, third-party sources of 
credit support vary in scope, terms and type of coverage, and can 
change (and have changed) over time. OFHEO intends to propose in the 
second NPR how the stress test will take into account the impact of 
third-party credit enhancements on mortgage losses.
7. Definition of ``Contiguous Areas''
    The 1992 Act requires that the benchmark loss experience must have 
``occurred in contiguous areas of the United States containing an 
aggregate of not less than 5 percent of the total population of the 
United States * * *.'' 42 In determining the appropriate level of 
geographic aggregation to employ in identifying the benchmark area, 
OFHEO considered using entire states or using substate areas based on 
the first two or three digits of ZIP Codes. After considering the 
various options, OFHEO decided to use states as the lowest level of 
aggregation. OFHEO will consider using substate areas in the future, 
taking into account changing geographic patterns of loss as well as any 
new developments in data aggregation technology, if appropriate.
---------------------------------------------------------------------------

    \42\ Section 1361(a)(1) (12 U.S.C. 4611 (a)(1)).
---------------------------------------------------------------------------

    OFHEO found that states are the most logical, efficient, and 
reasonable geographic units from which to construct a benchmark area. 
Although rating agencies conduct studies at various levels of 
aggregation, analysis at the state level is common practice. For 
example, Moody's has established diversification criteria for loan 
pools based on loan distribution by state, and, in stress tests, both 
Moody's and Duff & Phelps have projected mean times to foreclosure 
based on state locations.43
---------------------------------------------------------------------------

    \43\ Duff & Phelps, The Rating of Residential Mortgage-Backed 
Securities, Oct. 1995, at 31; and Moody's, Moody's Approach to 
Rating Residential Mortgage Pass-Throughs, Structured Finance 
Research and Commentary: Special Report (1995), at 19.
---------------------------------------------------------------------------

    The level of geographic aggregation has a significant impact on the 
level of potential benchmark loss rates. In general, the smaller the 
geographic units used, the higher the loss rates that can be 
identified. By connecting pockets of severe losses with narrow parcels 
of land, OFHEO could create an area with extremely high loss rates.
    However, such a result is not consistent with the intent of the 
legislation, which envisioned that the benchmark area would be 
``reasonably compact.'' 44 Furthermore, use of areas defined by 
ZIP Code would have greatly complicated the process of identifying the 
benchmark area by enormously increasing the number of candidates 
requiring consideration.
---------------------------------------------------------------------------

    \44\ S. Rep. No. 282, at 20.
---------------------------------------------------------------------------

    Commenters who addressed this issue unanimously supported the use 
of states as the smallest geographic unit in the benchmark analysis. 
MBA suggested that a contiguous area based on smaller units could look 
``gerrymandered'' and that ``[f]inding the exact combination [of 
counties and metropolitan statistical areas] to produce the most severe 
loss results * * * should not be the goal.'' Freddie Mac observed that 
``using finer geographic areas [than states] would present significant 
computational difficulties in aggregating to five percent of the 
population.''
8. Procedures for Accounting for Different LTV Ratios
    LTV ratios are highly correlated with mortgage losses. Therefore, 
the different distributions of LTV ratios in candidate state/year 
combinations have an impact

[[Page 29604]]

on the relative loss rates of those candidates. In the ANPR, OFHEO 
suggested it would consider grouping loans by LTV ratio, computing 
separate default or loss rates for loans in each LTV range, and 
computing overall default or loss rates by assuming some standard 
distribution of LTV ratios and weighting the LTV-specific loss rates 
according to this distribution. After further evaluation, OFHEO has 
decided to compute loss rates for candidates on a dollar weighted 
basis, that is, based on loan balances without regard to LTV ratios.
    OFHEO selected the simpler approach for three reasons. First, in 
many candidate state/year combinations there are too few loans in some 
LTV ranges for meaningful analysis. Second, OFHEO has found no 
acceptable basis to justify using any specific LTV weights to identify 
the benchmark loss experience. Finally, weighting loss rates by LTV 
category would be inconsistent with the intent of the 1992 Act that 
OFHEO determine the worst actual mortgage loss experience. Although the 
effects on mortgage losses of different LTV distributions are not 
controlled for in the identification of the benchmark loss experience, 
those effects will be accounted for in the stress test.
    Fannie Mae commented that in comparing candidates, loss rates 
``should be constructed from LTV-specific default and severity rates, 
weighted by the proportions of loans outstanding in the current book of 
business.'' The rationale for this approach is that, because 
distributions of LTV ratios at origination in candidate state/year 
combinations will differ from the Enterprises' current LTV 
distribution, loss rates of candidates should be normalized (weighted 
by the current book of business) to provide the most relevant measure 
of risk exposure.
    For the reasons discussed above, OFHEO believes Fannie Mae's 
suggested weighting approach is inappropriate in the benchmark 
analysis. Further, because LTV distributions change constantly and 
changing LTV weightings will alter loss figures for candidate state/
year combinations, Fannie Mae's approach would necessitate the frequent 
reconsideration of candidates, increasing the unpredictability and 
regulatory burden of the risk-based capital regulation.
9. Procedures for Combining Data from Different States and Years in 
Computing Default and Severity Rates
    In computing default and severity rates for specific candidate 
state/year combinations, OFHEO treated loans from different states and 
different origination years within that combination equally, producing 
a single aggregate default rate and a single aggregate severity rate 
for each Enterprise. OFHEO adopted this approach because it is a 
straightforward and simple way to derive aggregate default and severity 
rates. Moreover, the Enterprise data sets, especially in the early 
1980s, are not sufficiently complete to reflect accurately the 
distribution by origination year and state of Enterprise purchases of 
loans. OFHEO's approach more accurately reflects the actual loss 
experience of loans owned or guaranteed by the Enterprises in candidate 
state/year combinations than other approaches OFHEO considered.
    Fannie Mae recommended that OFHEO calculate state-level loss rates 
and that ``benchmark loss rates * * * be built by constructing 
population-weighted averages of state loss rates * * * to meet the five 
percent or greater standard.'' Freddie Mac also suggested this 
approach, and stated that ``[t]his method would appropriately weight 
economic events rather than emphasizing an Enterprise's market share in 
each state during the relevant time period.'' Freddie Mac recommended 
extending this approach by calculating separate state loss rates for 
each origination year and averaging them for each state before 
population weighting the resulting average state loss rates.
    OFHEO disagrees that the appropriate goal in identifying the 
benchmark loss experience is to reflect the underlying economic 
circumstances on a population- and time-weighted basis. Rather, OFHEO 
believes it is appropriate to reflect the actual loss experience of a 
relevant group of mortgages. The 1992 Act specifies that the benchmark 
loss experience should be identified based on the highest rates of 
loss, not the highest rates that would have occurred if loans had been 
distributed across states according to population and evenly across 
origination years. Enterprise purchases are not made evenly on a per 
capita basis, and some years have much higher levels of mortgage 
lending than others. OFHEO, therefore, has no basis to conclude that 
population weighting and annual averaging would yield accurate 
estimates of either Enterprise's default or severity rates for 
candidate state/year combinations.
    Furthermore, population weighting and averaging across origination 
years would place heavy reliance on very small amounts of data from 
some states for some years. Freddie Mac suggested that OFHEO should 
``[e]stablish a minimum acceptable number of observations or dollar 
volume for each state/origination-year combination for each Enterprise, 
to ensure that there are sufficient data from which to make valid 
inferences * * *. '' Although such an approach would address Freddie 
Mac's concern, it would do so at the cost of eliminating large portions 
of the available data set, sharply restricting the range of state/year 
combinations that could be considered. Instead, OFHEO considered the 
available data from less populous states, and avoided placing undue 
emphasis on small loan samples by pooling data from all states and 
origination years of a candidate before calculating default and 
severity rates.
10. Procedures for Combining Default and Severity Rates of the Two 
Enterprises
    OFHEO calculated the default and severity rates for each Enterprise 
separately for candidate state/year combinations, then averaged the 
results. The proposed methodology takes account of the significant 
differences in the mortgage loan purchases of the two Enterprises in 
the early 1980s, which are reflected in their respective data sets. The 
loans in each data set differ by predominant purpose of purchase 
(securitization or portfolio holding), mix of lender types (such as 
thrifts or mortgage banks), geographic distributions, and default rates 
(Fannie Mae's were consistently higher in that period). These 
differences reflect historical differences in the business strategies, 
customers, and markets of the Enterprises.
    Since the early 1980s, the Enterprises' business activities, 
markets, and credit risk profiles have become more similar. For 
example, during that time, Fannie Mae primarily bought loans and held 
them in portfolio, while Freddie Mac securitized all but a few loans it 
purchased. Currently, both Enterprises have extensive portfolio 
investments in mortgages and also guarantee an even larger volume of 
securities backed by mortgages.
    In OFHEO's judgment, each of the two data sets constitutes an 
equally relevant historical experience. Merging the data of the two 
Enterprises without averaging would cause the experience of one or the 
other Enterprise's loans to dominate the resulting combined loan sample 
for many candidates. The proposed methodology avoids that result by 
giving equal weight to the two equally relevant experiences.
    Both Freddie Mac and Fannie Mae suggested that OFHEO base the 
selection of the benchmark loss experience on a simple average of the

[[Page 29605]]

two Enterprises' experiences. Fannie Mae stated that ``loss rates 
should equal the average of Fannie Mae and Freddie Mac experience.'' 
Freddie Mac agreed, stating that ``[t]aking the simple average of the 
historical experience of the [Enterprises] would help smooth such 
institutional differences, thereby emphasizing the macroeconomic 
aspects of historical experience.''
    In its comment, HUD stated that ``[t]he language of Section 
1361(a)(1) [of the 1992 Act] seems to constrain OFHEO to using 
historical weights based on the [Enterprises'] respective market shares 
in averaging Fannie [Mae] and Freddie [Mac] default rates.'' As 
discussed above, OFHEO believes an equal weighting of the two 
Enterprises' default and severity rates experiences is more appropriate 
at this time. Enterprise historical data from the late 1970s and early 
1980s do not provide an accurate estimate of the relative number of 
single-family FRMs actually purchased or guaranteed by each Enterprise 
from specific origination years or geographic areas (including the 
nation as a whole). Therefore, market share weighting using that data 
would be difficult and imprecise.
    The 1992 Act provides broad discretion to the Director to use any 
reasonable weighting or averaging method in the identification of the 
benchmark loss experience.45 The proposed approach, which gives 
equal weight to the default and severity experience of each 
Enterprise's loans in identifying the benchmark loss experience, is 
within the Director's discretion. Loss data for loans originating in 
more recent years than those in the currently identified benchmark loss 
experience have been and should continue to be more complete. As OFHEO 
monitors future data, it will consider whether the new data would 
provide a basis for a different method of weighting, such as market 
share weighting. In the event an alternative method of weighting is 
appropriate, OFHEO would propose an amendment to the regulation to 
incorporate that different methodology.
---------------------------------------------------------------------------

    \45\ Section 1361(a)(1) (12 U.S.C. 4611(a)(1)).
---------------------------------------------------------------------------

11. Number of Origination Years in the Benchmark Loss Experience
    The 1992 Act requires the identification of a benchmark loss 
experience with the highest loss rate on mortgage loans, consistent 
with the relevant statutory requirements, including the requirement 
that the period be at least 2 years. The benchmark loss experience 
should include more than 2 origination years only if the candidate with 
the highest loss rate covers more than 2 origination years. OFHEO 
evaluated potential benchmark areas over 2-, 3-, and 4-origination year 
periods. The candidate state/year combination with the highest mortgage 
loss rate, the proposed benchmark loss experience, is based on loans 
originated during a 2-year period.
    Fannie Mae suggested that more than 2 origination years should be 
used, presumably to lower the benchmark loss rate, if the shorter 
period would ``push prices outside the range that the market would 
accept * * *.'' Presumably, ``prices'' refers to the guarantee fees the 
Enterprises charge and the prices they pay for mortgages. OFHEO does 
not believe Fannie Mae's suggestion is consistent with the requirements 
of the 1992 Act. Furthermore, the proposed benchmark loss experience is 
consistent with the establishment of an appropriate risk-based capital 
standard.

                                               Highest Loss Rates Among Candidate State/Year Combinations                                               
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        Percent of   Freddie   Fannie              Freddie   Fannie                     
 Rank  Time period                        Region                           U.S.        Mac       Mae     Average     Mac       Mae     Average    Loss  
                                                                        population  severity  severity  severity   default   default   default    rate  
--------------------------------------------------------------------------------------------------------------------------------------------------------
1....    1983/1984  AR, LA, MS, OK....................................       5.29      60.94     65.58     63.26     11.28     18.54     14.91      9.43
2....    1981/1982  IA, ID, ND, NE, OR, SD, UT, WY....................       5.00      56.86     59.18     58.02      9.71     22.06     15.88      9.22
3....    1981/1982  IA, ID, MT, ND, NE, OR, UT, WY....................       5.05      56.86     59.20     58.03      9.39     22.00     15.69      9.11
4....    1983/1984  IA, KS, MT, ND, NE, OK, WY........................       5.09      63.25     64.52     63.89      8.92     19.53     14.23      9.09
5....    1981/1982  IA, ID, MT, ND, NE, OR, SD, UT, WY................       5.35      56.86     59.20     58.03      9.33     21.91     15.62      9.07
6....    1981/1982  IA, ID, MT, NE, OR, SD, UT, WY....................       5.06      56.86     59.13     57.99      9.23     21.90     15.56      9.03
7....    1983/1984  IA, KS, ND, NE, OK, SD, WY........................       5.04      63.10     64.55     63.83      8.95     19.33     14.14      9.03
8....    1982/1984  AR, LA, MS, OK....................................       5.31      60.23     65.78     63.00     11.34     16.95     14.14      8.91
9....    1982/1984  IA, KS, MT, ND, NE, OK, WY........................       5.20      62.50     65.45     63.97      8.99     18.69     13.84      8.85
10...    1982/1984  IA, KS, ND, NE, OK, SD, WY........................       5.16      62.38     65.47     63.93      9.04     18.58     13.81      8.83
11...    1981/1984  AR, LA, MS, OK....................................       5.31      60.52     65.28     62.90     11.16     16.46     13.81      8.69
12...    1981/1984  IA, KS, MT, ND, NE, OK, WY........................       5.20      62.36     65.68     64.02      8.86     18.27     13.56      8.68
13...    1981/1984  IA, KS, ND, NE, OK, SD, WY........................       5.16      62.25     65.71     63.98      8.91     18.20     13.55      8.67
14...    1981/1982  IA, KS, ND, NE, OK, SD, UT, WY....................       5.80      60.43     66.06     63.25      9.96     17.46     13.71      8.67
15...    1981/1982  IA, KS, NE, OK, UT, WY............................       5.21      60.43     66.06     63.25      9.94     17.47     13.70      8.67
16...    1981/1982  AR, KS, ND, NE, OK, SD, UT, WY....................       5.53      60.51     66.23     63.37     10.05     17.29     13.67      8.66
17...    1981/1982  IA, KS, NE, OK, SD, UT, WY........................       5.52      60.43     66.06     63.25      9.90     17.44     13.67      8.65
18...    1981/1982  AR, KS, NE, OK, SD, UT, WY........................       5.24      60.51     66.24     63.37     10.00     17.27     13.64      8.64
19...    1982/1983  IA, KS, ND, NE, OK, SD, WY........................       5.16      58.61     64.84     61.72      9.40     18.59     13.99      8.64
20...    1982/1983  IA,KS, MT, ND, NE, OK, WY.........................       5.20      58.55     64.83     61.69      9.29     18.66     13.98      8.62
21...    1981/1982  AR, KS, MT, ND, NE, OK, UT, WY....................       5.57      60.51     66.19     63.35      9.88     17.30     13.59      8.61
22...    1981/1982  AR, IA, KS, ND, NE, OK, SD, UT, WY................       6.81      60.51     66.20     63.36      9.88     17.28     13.58      8.60
23...    1981/1982  AR, IA, KS, NE, OK, UT, WY........................       6.22      60.51     66.21     63.36      9.86     17.29     13.58      8.60
24...    1981/1982  IA, KS, MT, ND, NE, OK, SD, UT, WY................       6.15      60.43     66.02     63.22      9.76     17.44     13.60      8.60

[[Page 29606]]

                                                                                                                                                        
25...    1981/1982  IA, KS, MT, NE, OK, UT, WY........................       5.56      60.43     66.02     63.23      9.74     17.45     13.59      8.59
26...    1981/1982  AR, KS, MT, ND, NE, OK, SD, UT, WY................       5.87      60.51     66.19     63.35      9.85     17.27     13.56      8.59
27...    1982/1983  AR, LA, MS, OK....................................       5.31      57.93     63.59     60.76     11.93     16.34     14.13      8.59
28...    1981/1982  AR, KS, MT, NE, OK, UT, WY........................       5.28      60.51     66.19     63.35      9.83     17.28     13.56      8.59
29...    1981/1982  AR, IA, KS, NE, OK, SD, UT, WY....................       6.52      60.51     66.21     63.36      9.83     17.26     13.55      8.58
30...    1981/1982  IA, KS, MT, NE, OK, SD, UT, WY....................       5.86      60.43     66.02     63.23      9.71     17.42     13.56      8.58
31...    1981/1982  AR, KS, MT, NE, OK, SD, UT, WY....................       5.59      60.51     66.19     63.35      9.80     17.25     13.53      8.57
32...    1982/1983  AR, KS, ND, NE, OK, SD, UT, WY....................       5.53      60.11     63.70     61.91      9.78     17.87     13.83      8.56
33...    1981/1982  AR, IA, KS, MT, ND, NE, OK, UT, WY................       6.86      60.51     66.16     63.33      9.72     17.29     13.51      8.55
34...    1982/1983  AR, KS, MT, ND, NE, OK, UT, WY....................       5.57      60.05     63.70     61.87      9.68     17.94     13.81      8.54
35...    1981/1982  AR, IA, KS, MT, ND, NE, OK, SD, UT, WY............       7.16      60.51     66.16     63.33      9.70     17.26     13.48      8.54
36...    1982/1983  AR, KS, NE, OK, SD, UT, WY........................       5.24      60.11     63.69     61.90      9.71     17.86     13.79      8.53
37...    1981/1982  AR, IA, KS, MT, NE, OK, UT, WY....................       6.57      60.51     66.16     63.34      9.67     17.27     13.47      8.53
38...    1982/1983  AR, KS, MT, ND, NE, OK, SD, UT, WY................       5.87      60.05     63.70     61.87      9.68     17.88     13.78      8.53
39...    1982/1983  AR, KS, MT, NE, OK, UT, WY........................       5.28      60.05     63.68     61.87      9.61     17.92     13.77      8.52
40...    1981/1982  AR, IA, KS, MT, NE, OK, SD, UT, WY................       6.87      60.51     66.16     63.34      9.65     17.24     13.44      8.51
41...    1982/1983  AR, AZ, ND, NM, OK, SD, UT, WY....................       5.56      60.72     62.56     61.64      9.66     17.94     13.80      8.51
42...    1982/1983  AR, KS, MT, NE, OK, SD, UT, WY....................       5.59      60.05     63.68     61.87      9.62     17.87     13.74      8.50
43...    1982/1983  AR, AZ, MT, ND, NM, OK, UT, WY....................       5.61      60.65     62.56     61.61      9.56     18.00     13.78      8.49
44...    1981/1982  IA, ID, KS, NE, OK, UT, WY........................       5.63      59.45     65.70     62.58      9.84     17.28     13.56      8.49
45...    1982/1983  IA, KS, ND, NE, OK, SD, UT, WY....................       5.80      60.09     63.86     61.98      9.34     18.04     13.69      8.49
46...    1980/1982  IA, ID, ND, NE, OR, SD, UT, WY....................       5.00      55.21     56.97     56.09     10.01     20.24     15.13      8.49
47...    1981/1982  AR, ID, KS, NE, OK, UT, WY........................       5.35      59.54     65.87     62.70      9.93     17.12     13.53      8.48
48...    1982/1983  AR, AZ, NM, OK, SD, UT, WY........................       5.28      60.72     62.55     61.63      9.59     17.93     13.76      8.48
49...    1981/1983  IA, KS, ND, NE, OK, SD, WY........................       5.16      58.69     65.23     61.96      9.20     18.17     13.69      8.48
50...    1981/1982  ID, KS, MT, ND, NE, OK, SD, UT, WY................       5.28      59.45     65.68     62.57      9.84     17.26     13.55      8.48
51...    1982/1983  IA, KS, NE, OK, UT, WY............................       5.21      60.09     63.85     61.97      9.27     18.08     13.67      8.47
52...    1980/1981  IA, ID, ND, NE, OR, SD, UT, WY....................       5.00      51.85     55.66     53.75     10.79     20.70     15.75      8.46
53...    1982/1983  AR, AZ, MT, NM, OK, UT, WY........................       5.32      60.65     62.54     61.60      9.49     17.99     13.74      8.46
54...    1981/1983  IA, KS, MT, ND, NE, OK, WY........................       5.20      58.64     65.21     61.92      9.10     18.22     13.66      8.46
55...    1982/1983  IA, KS, NE, OK, SD, UT, WY........................       5.52      60.09     63.85     61.97      9.27     18.03     13.65      8.46
56...    1982/1983  IA, KS, MT, ND, NE, OK, SD, UT, WY................       6.15      60.03     63.85     61.94      9.25     18.06     13.65      8.46
57...    1982/1983  AR, AZ, MT, NM, OK, SD, UT, WY....................       5.62      60.65     62.54     61.60      9.49     17.94     13.72      8.45
58...    1982/1983  IA, KS, MT, NE, OK, UT, WY........................       5.56      60.03     63.84     61.93      9.18     18.09     13.64      8.45
59...    1981/1983  AR, KS, ND, NE, OK, SD, UT, WY....................       5.53      58.90     64.06     61.48      9.74     17.73     13.74      8.44
60...    1982/1983  AZ, ND, NE, NM, OK, SD, UT, WY....................       5.25      60.67     62.70     61.69      9.54     17.83     13.69      8.44
61...    1981/1983  AR, LA, MS, OK....................................       5.31      58.55     63.51     61.03     11.67     15.98     13.83      8.44
62...    1982/1983  IA, KS, MT, NE, OK, SD, UT, WY....................       5.86      60.03     63.84     61.93      9.19     18.04     13.61      8.43
63...    1982/1983  AZ, IA, ND, NM, OK, SD, UT, WY....................       5.84      60.70     62.69     61.69      9.23     18.09     13.66      8.43
64...    1982/1983  AZ, MT, ND, NE, NM, OK, UT, WY....................       5.29      60.60     62.70     61.65      9.44     17.89     13.67      8.42
65...    1981/1982  ID, KS, ND, NE, OK, OR, SD, UT, WY................       6.10      59.44     65.18     62.31      9.69     17.35     13.52      8.42
66...    1981/1983  AR, KS, MT, ND, NE, OK, UT, WY....................       5.57      58.85     64.04     61.45      9.64     17.78     13.71      8.42
         1981/1982  ID, KS, NE, OK, OR, UT, WY........................       5.50      59.44     65.18     62.31      9.67     17.36     13.52      8.42
68...    1981/1983  AR, KS, NE, OK, SD, UT, WY........................       5.24      58.90     64.04     61.47      9.68     17.72     13.70      8.42
69...    1981/1983  AR, KS, MT, ND, NE, OK, SD, UT, WY................       5.87      58.85     64.04     61.45      9.64     17.73     13.68      8.41
70...    1981/1982  AR, KS, LA, ND, NE, OK, SD, UT, WY................       7.38      58.28     64.99     61.64     10.50     16.78     13.64      8.41
71...    1981/1982  ID, KS, NE, OK, OR, SD, UT, WY....................       5.81      59.44     65.18     62.31      9.65     17.33     13.49      8.40
72...    1981/1982  AR, KS, LA, NE, OK, UT, WY........................       6.79      58.28     64.99     61.63     10.48     16.78     13.63      8.40
73...    1982/1983  AZ, IA, NM, OK, SD, UT, WY........................       5.55      60.70     62.67     61.68      9.16     18.08     13.62      8.40
74...    1982/1983  AZ, IA, MT, ND, NM, OK, SD, UT, WY................       6.19      60.63     62.68     61.66      9.15     18.10     13.63      8.40
75...    1982/1983  AZ, MT, NE, NM, OK, UT, WY........................       5.00      60.60     62.68     61.64      9.38     17.88     13.63      8.40
76...    1981/1983  AR, KS, MT, NE, OK, UT, WY........................       5.28      58.85     64.03     61.44      9.58     17.76     13.67      8.40
77...    1981/1982  AZ, IA, ND, NM, OK, SD, UT, WY....................       5.84      61.09     63.52     62.30      9.04     17.92     13.48      8.40

[[Page 29607]]

                                                                                                                                                        
78...    1981/1982  AR, AZ, ND, NM, OK, SD, UT, WY....................       5.56      61.16     63.66     62.41      9.12     17.79     13.45      8.39
79...    1981/1982  AR, KS, LA, NE, OK, SD, UT, WY....................       7.09      58.28     64.99     61.63     10.45     16.76     13.61      8.39
80...    1982/1983  AZ, MT, NE, NM, OK, SD, UT, WY....................       5.31      60.60     62.68     61.64      9.38     17.83     13.61      8.39
81...    1981/1983  AR, KS, MT, NE, OK, SD, UT, WY....................       5.59      58.85     64.03     61.44      9.58     17.72     13.65      8.38
82...    1981/1982  ID, KS, MT, ND, NE, OK, OR, UT, WY................       6.14      59.44     65.15     62.29      9.56     17.35     13.45      8.38
83...    1981/1983  IA, KS, ND, NE, OK, SD, UT, WY....................       5.80      58.89     64.22     61.55      9.33     17.90     13.61      8.38
84...    1981/1982  AZ, IA, NM, OK, SD, UT, WY........................       5.55      61.09     63.51     62.30      8.99     17.91     13.45      8.38
85...    1982/1983  AZ, IA, MT, NM, OK, SD, UT, WY....................       5.90      60.63     62.67     61.65      9.08     18.09     13.59      8.38
86...    1981/1982  AR, AZ, NM, OK, SD, UT, WY........................       5.28      61.16     63.66     62.41      9.07     17.77     13.42      8.37
87...    1981/1982  IA, ID, KS, NE, OK, OR, UT, WY....................       6.79      59.44     65.17     62.31      9.53     17.35     13.44      8.37
88...    1981/1982  AR, ID, KS, ND, NE, OK, OR, SD, UT, WY............       7.11      59.52     65.34     62.43      9.63     17.19     13.41      8.37
89...    1981/1983  IA, KS, NE, OK, UT, WY............................       5.21      58.89     64.21     61.55      9.27     17.93     13.60      8.37
90...    1981/1982                                                                                                                                      
               AR,  ID, KS, NE, OK, OR, UT, WY........................       6.51      59.52     65.34     62.43      9.61     17.20     13.40      8.37
91...    1981/1982  ID, KS, MT, ND, NE, OK, OR, SD, UT, WY............       6.44      59.44     65.15     62.29      9.53     17.33     13.43      8.37
92...    1982/1983  AR, IA, KS, ND, NE, OK, SD, UT, WY................       6.81      60.15     63.63     61.89      9.22     17.80     13.51      8.36
93...    1981/1982  ID, KS, MT, NE, OK, OR, UT, WY....................       5.85      59.44     65.15     62.29      9.51     17.34     13.42      8.36
94...    1981/1982  AR, KS, LA, MT, ND, NE, OK, UT, WY................       7.43      58.28     64.97     61.63     10.34     16.78     13.56      8.36
95...    1982/1983  ID, KS, MT, ND, NE, OK, SD, UT, WY................       5.28      58.40     63.82     61.11      9.72     17.63     13.67      8.36
96...    1981/1982  AR, AZ, MT, ND, NM, OK, UT, WY....................       5.61      61.16     63.64     62.40      8.99     17.79     13.39      8.36
97...    1981/1983  IA, KS, NE, OK, SD, UT, WY........................       5.52      58.89     64.21     61.55      9.27     17.88     13.57      8.35
98...    1981/1982  AR, IA, KS, LA, NE, OK, UT, WY....................       8.08      58.28     64.98     61.63     10.33     16.78     13.56      8.35
99...    1982/1983  AR, IA, KS, MT, ND, NE, OK, UT, WY................       6.86      60.09     63.62     61.85      9.14     17.86     13.50      8.35
100..    1982/1983  AR, IA, KS, NE, OK, UT, WY........................       6.22      60.15     63.61     61.88      9.15     17.84     13.49      8.35
101..    1981/1982  AR, AZ, IA, ND, NM, OK, SD, UT, WY................       6.85      61.16     63.68     62.42      8.99     17.77     13.38      8.35
102..    1981/1983  IA, KS, MT, ND, NE, OK, SD, UT, WY................       6.15      58.84     64.20     61.52      9.24     17.90     13.57      8.35
103..    1981/1982  AR, KS, LA, MT, ND, NE, OK, SD, UT, WY............       7.73      58.28     64.97     61.63     10.31     16.77     13.54      8.34
104..    1981/1982  AZ, IA, MT, ND, NM, OK, SD, UT, WY................       6.19      61.09     63.50     62.30      8.89     17.90     13.39      8.34
105..    1981/1982  AR, KS, LA, MT, NE, OK, UT, WY....................       7.14      58.28     64.97     61.62     10.30     16.77     13.54      8.34
106..    1981/1982  AR, IA, KS, LA, NE, OK, SD, UT, WY................       8.38      58.28     64.98     61.63     10.30     16.77     13.53      8.34
107..    1981/1983  IA, KS, MT, NE, OK, UT, WY........................       5.56      58.84     64.19     61.52      9.18     17.93     13.55      8.34
108..    1982/1983  AR, IA, KS, MT, ND, NE, OK, SD, UT, WY............       7.16      60.09     63.62     61.85      9.14     17.81     13.48      8.34
109..    1981/1982  IA, ID, KS, MT, ND, NE, OK, OR, UT, WY............       7.42      59.44     65.14     62.29      9.42     17.34     13.38      8.34
110..    1982/1983  AR, IA, KS, NE, OK, SD, UT, WY....................       6.52      60.15     63.61     61.88      9.16     17.78     13.47      8.34
111..    1981/1982  AR, AZ, MT, NM, OK, UT, WY........................       5.32      61.16     63.64     62.40      8.94     17.77     13.36      8.34
112..    1981/1983  AR, AZ, ND, NM, OK, SD, UT, WY....................       5.56      59.13     62.52     60.83      9.48     17.92     13.70      8.33
113..    1981/1982  AR, AZ, IA, NM, OK, SD, UT, WY....................       6.56      61.16     63.67     62.41      8.94     17.75     13.35      8.33
114..    1981/1982  AR, ID, KS, MT, ND, NE, OK, OR, UT, WY............       7.15      59.52     65.31     62.42      9.50     17.19     13.35      8.33
115..    1981/1982  AR, KS, LA, MT, NE, OK, SD, UT, WY................       7.44      58.28     64.97     61.62     10.27     16.75     13.51      8.33
116..    1981/1982  IA, KS, ND, NE, OK, SD, WY........................       5.16      60.54     66.92     63.73      8.72     17.42     13.07      8.33
117..    1981/1982  AR, IA, ID, KS, ND, NE, OK, OR, SD, UT, WY........       8.39      59.52     65.33     62.43      9.50     17.18     13.34      8.33
118..    1982/1983  AZ, ID, MT, ND, NM, OK, UT, WY....................       5.01      59.02     62.65     60.84      9.59     17.78     13.69      8.33
119..    1982/1983  AR, IA, KS, MT, NE, OK, UT, WY....................       6.57      60.09     63.60     61.85      9.07     17.85     13.46      8.32
120..    1981/1982  AZ, IA, MT, NM, OK, SD, UT, WY....................       5.90      61.09     63.50     62.29      8.84     17.88     13.36      8.32
121..    1981/1983  IA, KS, MT, NE, OK, SD, UT, WY....................       5.86      58.84     64.19     61.52      9.18     17.88     13.53      8.32
122..    1982/1983  AR, AZ, IA, ND, NM, OK, SD, UT, WY................       6.85      60.75     62.51     61.63      9.12     17.88     13.50      8.32

[[Page 29608]]

                                                                                                                                                        
123..    1981/1982  AR, AZ, MT, NM, OK, SD, UT, WY....................       5.62      61.16     63.64     62.40      8.92     17.75     13.33      8.32
124..    1981/1982  IA, ID, KS, MT, ND, NE, OK, OR, SD, UT, WY........       7.73      59.44     65.14     62.29      9.40     17.32     13.36      8.32
125..    1982/1983  AR, AZ, NE, NM, OK, UT, WY........................       5.66      60.72     62.51     61.62      9.34     17.66     13.50      8.32
126..    1981/1982  IA, ID, KS, MT, NE, OK, OR, UT, WY................       7.14      59.44     65.14     62.29      9.38     17.32     13.35      8.32
127..    1980/1982  IA, ID, MT, ND, NE, OR, UT, WY....................       5.05      55.09     57.02     56.06      9.51     20.16     14.83      8.32
128..    1981/1982  AR, ID, KS, MT, ND, NE, OK, OR, SD, UT, WY........       7.45      59.52     65.31     62.42      9.47     17.17     13.32      8.31
129..    1981/1983  AR, AZ, MT, ND, NM, OK, UT, WY....................       5.61      59.09     62.51     60.80      9.39     17.95     13.67      8.31
130..    1982/1983  AZ, ID, MT, ND, NM, OK, SD, UT, WY................       5.32      59.02     62.65     60.84      9.60     17.73     13.67      8.31
131..    1981/1982  AR, ID, KS, MT, NE, OK, OR, UT, WY................       6.86      59.52     65.31     62.41      9.45     17.18     13.31      8.31
132..    1982/1983  AR, IA, KS, MT, NE, OK, SD, UT, WY................       6.87      60.09     63.60     61.85      9.08     17.80     13.44      8.31
133..    1981/1983  AR, AZ, NM, OK, SD, UT, WY........................       5.28      59.13     62.51     60.82      9.42     17.90     13.66      8.31
134..    1981/1982  AZ, ND, NE, NM, OK, SD, UT, WY....................       5.25      61.15     63.44     62.30      9.01     17.67     13.34      8.31
135..    1981/1982  AR, IA, ID, KS, NE, OK, OR, SD, UT, WY............       8.10      59.52     65.33     62.43      9.45     17.16     13.31      8.31
136..    1982/1983  AZ, MS, ND, NM, OK, SD, UT, WY....................       5.67      59.83     62.34     61.09      9.47     17.71     13.59      8.30
137..    1981/1982  IA, ID, KS, MT, NE, OK, OR, SD, UT, WY............       7.44      59.44     65.14     62.29      9.35     17.30     13.33      8.30
138..    1981/1982  AR, AZ, IA, MT, ND, NM, OK, SD, UT, WY............       7.20      61.16     63.66     62.41      8.84     17.75     13.30      8.30
139..    1982/1983  AR, AZ, IA, MT, ND, NM, OK, SD, UT, WY............       7.20      60.68     62.51     61.59      9.05     17.89     13.47      8.30
140..    1982/1983  AR, AZ, IA, NM, OK, SD, UT, WY....................       6.56      60.75     62.50     61.62      9.06     17.87     13.46      8.30
141..    1981/1983  AR, AZ, MT, NM, OK, UT, WY........................       5.32      59.09     62.50     60.79      9.33     17.94     13.64      8.29
142..    1981/1983  ID, KS, MT, ND, NE, OK, SD, UT, WY................       5.28      57.48     64.03     60.76      9.67     17.62     13.64      8.29
143..    1982/1983  AZ, ID, MT, NM, OK, SD, UT, WY....................       5.03      59.02     62.64     60.83      9.53     17.72     13.63      8.29
144..    1980/1982  IA, ID, MT, ND, NE, OR, SD, UT, WY................       5.35      55.09     57.02     56.06      9.48     20.09     14.78      8.29
145..    1982/1983  AZ, MS, MT, ND, NM, OK, UT, WY....................       5.71      59.78     62.34     61.06      9.38     17.76     13.57      8.29
146..    1981/1982  AR, IA, ID, KS, MT, ND, NE, OK, OR, UT, WY........       8.43      59.52     65.29     62.41      9.37     17.19     13.28      8.29
147..    1981/1982  IA, KS, MT, ND, NE, OK, WY........................       5.20      60.54     66.87     63.70      8.57     17.42     12.99      8.28
148..    1981/1983  AR, AZ, MT, NM, OK, SD, UT, WY....................       5.62      59.09     62.50     60.79      9.33     17.90     13.62      8.28
149..    1981/1982  AR, AZ, IA, MT, NM, OK, SD, UT, WY................       6.91      61.16     63.65     62.41      8.80     17.73     13.27      8.28
150..    1982/1983  AZ, MS, NM, OK, SD, UT, WY........................       5.38      59.83     62.33     61.08      9.41     17.69     13.55      8.28
151..    1981/1982  AR, IA, ID, KS, MT, ND, NE, OK, OR, SD, UT, WY....       8.74      59.52     65.29     62.41      9.35     17.16     13.25      8.27
152..    1981/1983  AR, IA, KS, ND, NE, OK, SD, UT, WY................       6.81      58.94     64.05     61.50      9.21     17.68     13.45      8.27
153..    1980/1981  IA, ID, MT, ND, NE, OR, UT, WY....................       5.05      51.74     55.73     53.73     10.22     20.57     15.39      8.27
154..    1982/1983  AR, AZ, IA, MT, NM, OK, SD, UT, WY................       6.91      60.68     62.49     61.59      8.98     17.88     13.43      8.27
155..    1981/1982  AZ, MT, ND, NE, NM, OK, UT, WY....................       5.29      61.15     63.43     62.29      8.88     17.67     13.28      8.27
156..    1980/1983  IA, KS, ND, NE, OK, SD, WY........................       5.16      57.74     64.56     61.15      9.26     17.78     13.52      8.27
157..    1981/1983  AZ, IA, ND, NM, OK, SD, UT, WY....................       5.84      59.12     62.64     60.88      9.11     18.05     13.58      8.27
158..    1981/1982  AR, IA, ID, KS, MT, NE, OK, OR, UT, WY............       8.15      59.52     65.29     62.41      9.33     17.17     13.25      8.27
159..    1981/1982  AZ, IA, ND, NE, NM, OK, SD, UT, WY................       6.54      61.15     63.46     62.30      8.88     17.65     13.27      8.27
160..    1981/1983  AZ, ND, NE, NM, OK, SD, UT, WY....................       5.25      59.12     62.56     60.84      9.36     17.80     13.58      8.26
161..    1982/1983  AZ, MS, MT, NM, OK, UT, WY........................       5.42      59.78     62.32     61.05      9.32     17.75     13.53      8.26
162..    1982/1983  AZ, IA, ND, NE, NM, OK, SD, UT, WY................       6.54      60.70     62.65     61.67      9.02     17.77     13.40      8.26
163..    1981/1983  AR, IA, KS, NE, OK, UT, WY........................       6.22      58.94     64.04     61.49      9.15     17.71     13.43      8.26

[[Page 29609]]

                                                                                                                                                        
164..    1981/1982  AZ, IA, NE, NM, OK, UT, WY........................       5.94      61.15     63.45     62.30      8.86     17.66     13.26      8.26
165..    1981/1982  AR, AZ, NE, NM, OK, UT, WY........................       5.66      61.22     63.60     62.41      8.93     17.53     13.23      8.26
166..    1981/1983  AR, IA, KS, MT, ND, NE, OK, UT, WY................       6.86      58.90     64.03     61.47      9.13     17.73     13.43      8.26
167..    1982/1983  AR, ID, KS, NE, OK, UT, WY........................       5.35      58.51     63.58     61.05      9.62     17.42     13.52      8.25
168..    1981/1982  AZ, ID, MT, ND, NM, OK, UT, WY....................       5.01      60.10     63.25     61.68      9.00     17.77     13.38      8.25
169..    1982/1984  IA, KS, NE, OK, UT, WY............................       5.21      60.49     64.45     62.47      8.53     17.90     13.21      8.25
170..    1981/1982  AZ, MT, NE, NM, OK, UT, WY........................       5.00      61.15     63.42     62.28      8.83     17.66     13.25      8.25
171..    1982/1983  AZ, MS, MT, NM, OK, SD, UT, WY....................       5.73      59.78     62.32     61.05      9.32     17.70     13.51      8.25
172..    1982/1983  AZ, IA, NE, NM, OK, UT, WY........................       5.94      60.70     62.63     61.67      8.95     17.80     13.38      8.25
173..    1982/1984  IA, KS, ND, NE, OK, SD, UT, WY....................       5.80      60.41     64.47     62.44      8.60     17.82     13.21      8.25
174..    1981/1983  AR, IA, KS, NE, OK, SD, UT, WY....................       6.52      58.94     64.04     61.49      9.15     17.67     13.41      8.25
175..    1980/1982  IA, ID, MT, NE, OR, SD, UT, WY....................       5.06      55.22      9.34     56.09      9.34     20.07     14.70      8.25
176..    1981/1982  AZ, LA, ND, NM, OK, SD, UT, WY....................       6.41      58.76     63.42     61.09      9.70     17.30     13.50      8.25
177..    1981/1982  AZ, IA, NE, NM, OK, SD, UT, WY....................       6.25      61.15     63.45     62.30      8.83     17.64     13.23      8.25
178..    1981/1983  AZ, IA, NM, OK, SD, UT, WY........................       5.55      59.12     62.63     60.87      9.04     18.04     13.54      8.24
179..    1982/1984  IA, KS, MT, NE, OK, UT, WY........................       5.56      60.54     64.44     62.49      8.49     17.90     13.19      8.24
180..    1980/1981  IA, ID, MT, ND, NE, OR, SD, UT, WY................       5.35      51.74     55.73     53.73     10.18     20.50     15.34      8.24
181..    1981/1983  AZ, MT, ND, NE, NM, OK, UT, WY....................       5.29      59.07     62.55     60.81      9.28     17.84     13.56      8.24
182..    1981/1982  AR, AZ, ID, NM, OK, UT, WY........................       5.39      60.18     63.42     61.80      9.04     17.63     13.34      8.24
183..    1981/1983  AR, IA, KS, MT, ND, NE, OK, SD, UT, WY............       7.16      58.90     64.03     61.47      9.13     17.68     13.41      8.24
184..    1981/1983  AZ, IA, MT, ND, NM, OK, SD, UT, WY................       6.19      59.08     62.63     60.85      9.03     18.05     13.54      8.24
185..    1981/1982  AZ, ID, MT, ND, NM, OK, SD, UT, WY................       5.32      60.10     63.25     61.68      8.97     17.74     13.36      8.24
186..    1982/1984  IA, KS, MT, ND, NE, OK, SD, UT, WY................       6.15      60.46     64.46     62.46      8.56     17.81     13.19      8.24
187..    1983/1984  AR, AZ, LA, NM, OK................................       6.15      59.53     64.60     62.07      9.23     17.31     13.27      8.24
188..    1982/1983  AZ, IA, NE, NM, OK, SD, UT, WY....................       6.25      60.70     62.63     61.67      8.95     17.76     13.36      8.24
189..    1981/1982  AZ, MT, NE, NM, OK, SD, UT, WY....................       5.31      61.15     63.42     62.28      8.81     17.63     13.22      8.24
190..    1982/1984  AR, KS, MT, ND, NE, OK, UT, WY....................       5.57      60.01     64.36     62.18      8.83     17.65     13.24      8.23
191..    1981/1983  AR, IA, KS, MT, NE, OK, UT, WY....................       6.57      58.90     64.02     61.46      9.07     17.71     13.39      8.23
192..    1981/1982  AZ, IA, ID, NM, OK, SD, UT, WY....................       5.97      60.10     63.28     61.69      8.95     17.73     13.34      8.23
193..    1981/1982  AZ, LA, NM, OK, SD, UT, WY........................       6.12      58.76     63.42     61.09      9.66     17.28     13.47      8.23
194..    1981/1982  AR, KS, MS, ND, NE, OK, SD, UT, WY................       6.64      59.80     65.04     62.42      9.41     16.94     13.18      8.23
195..    1982/1983  AZ, IA, MT, NE, NM, OK, UT, WY....................       6.29      60.63     62.63     61.63      8.88     17.81     13.34      8.22
196..    1982/1983  AR, AZ, ID, NM, OK, UT, WY........................       5.39      59.13     62.46     60.80      9.50     17.56     13.53      8.22
197..    1981/1982  AR, KS, MS, NE, OK, UT, WY........................       6.05      59.80     65.04     62.42      9.39     16.95     13.17      8.22
198..    1982/1983  AR, KS, MS, ND, NE, OK, SD, UT, WY................       6.64      59.29     63.22     61.26      9.47     17.37     13.42      8.22
199..    1981/1982  AZ, ID, MT, NM, OK, SD, UT, WY....................       5.03      60.10     63.25     61.67      8.92     17.73     13.33      8.22
200..    1981/1983  AZ, MT, NE, NM, OK, UT, WY........................       5.00      59.07     62.54     60.81      9.21     17.82     13.52      8.22
201..    1982/1984  IA, KS, NE, OK, SD, UT, WY........................       5.52      60.42     64.46     62.44      8.53     17.80     13.16      8.22
202..    1980/1983  IA, KS, MT, ND, NE, OK, WY........................       5.20      57.64     64.54     61.09      9.10     17.81     13.45      8.22
203..    1981/1983  AR, IA, KS, MT, NE, OK, SD, UT, WY................       6.87      58.90     64.02     61.46      9.07     17.67     13.37      8.22
204..    1981/1983  AZ, IA, MT, NM, OK, SD, UT, WY....................       5.90      59.08     62.62     60.85      8.97     18.04     13.50      8.22
205..    1981/1982  AR, AZ, IA, NE, NM, OK, UT, WY....................       6.95      61.22     63.61     62.42      8.81     17.52     13.16      8.22
206..    1980/1981  IA, ID, MT, NE, OR, SD, UT, WY....................       5.06      51.82     55.73     53.77     10.06     20.49     15.28      8.21
207..    1982/1983  AZ, IA, MT, NE, NM, OK, SD, UT, WY................       6.59      60.63     62.63     61.63      8.88     17.77     13.32      8.21
208..    1981/1982  AR, AZ, LA, ND, NM, OK, SD, UT, WY................       7.42      58.84     63.53     61.18      9.64     17.20     13.42      8.21
209..    1982/1984  AR, KS, ND, NE, OK, SD, UT, WY....................       5.53      59.88     64.38     62.13      8.87     17.56     13.21      8.21
210..    1982/1984  IA, KS, MT, NE, OK, SD, UT, WY....................       5.86      60.47     64.45     62.46      8.49     17.80     13.14      8.21
211..    1981/1982  AZ, ID, ND, NM, OK, OR, SD, UT, WY................       6.13      60.07     62.92     61.50      8.90     17.80     13.35      8.21
212..    1981/1982  AZ, IA, MT, NE, NM, OK, UT, WY....................       6.29      61.15     63.44     62.29      8.72     17.64     13.18      8.21
213..    1982/1983  AR, KS, MS, NE, OK, UT, WY........................       6.05      59.29     63.20     61.25      9.40     17.41     13.40      8.21
214..    1982/1983  AR, KS, MS, MT, ND, NE, OK, UT, WY................       6.68      59.24     63.21     61.22      9.38     17.44     13.41      8.21
215..    1981/1983  AZ, MT, NE, NM, OK, SD, UT, WY....................       5.31      59.07     62.54     60.81      9.21     17.78     13.50      8.21

[[Page 29610]]

                                                                                                                                                        
216..    1981/1982  AZ, LA, MT, ND, NM, OK, UT, WY....................       6.45      58.76     63.41     61.09      9.57     17.30     13.44      8.21
217..    1981/1982  AR, AZ, LA, NM, OK, UT, WY........................       6.83      58.84     63.52     61.18      9.63     17.20     13.41      8.21
218..    1981/1982  AZ, ID, NM, OK, OR, UT, WY........................       5.54      60.07     62.91     61.49      8.88     17.81     13.34      8.21
219..    1981/1983  AR, ID, KS, NE, OK, UT, WY........................       5.35      57.57     63.87     60.72      9.58     17.44     13.51      8.20
220..    1982/1984  AR, KS, MT, NE, OK, UT, WY........................       5.28      60.01     64.35     62.18      8.75     17.64     13.19      8.20
221..    1981/1982  AR, KS, MS, NE, OK, SD,UT WY......................       6.35      59.80     65.04     62.42      9.36     16.92     13.14      8.20
222..    1981/1983  AZ ID, MT, ND, NM, OK, UT, WY.....................       5.01      57.75     62.49     60.12      9.43     17.86     13.64      8.20
223..    1982/1984  AR, KS, MT, ND, NE, OK, SD, UT, WY................       5.87      59.94     64.37     62.16      8.82     17.56     13.19      8.20
224..    1982/1983  AZ, LA, ND, NM, OK, SD, UT, WY....................       6.41      59.21     62.16     60.68     10.02     17.00     13.51      8.20
225..    1981/1984   IA, KS, NE, OK, UT, WY...........................       5.21      59.73     64.67     62.20      8.56     17.81     13.18      8.20
226..    1981/1984  IA, KS, ND, NE, OK, SD, UT, WY....................       5.80      59.67     64.69     62.18      8.62     17.74     13.18      8.20
227..    1981/1982  AR, AZ, LA, NM, OK, SD, UT, WY....................       7.13      58.84     63.52     61.18      9.60     17.19     13.40      8.20
228..    1981/1982  AZ, IA, MT, NE, NM, OK, SD, UT, WY................       6.59      61.15     63.44     62.29      8.69     17.62     13.16      8.19
229..    1982/1983  AR, KS, MS, MT, ND, NE, OK, SD, UT, WY............       6.99      59.24     63.21     61.22      9.38     17.39     13.38      8.19
230..    1982/1983  AR, KS, MS, NE, OK, SD, UT, WY....................       6.35      59.29     63.20     61.25      9.40     17.36     13.38      8.19
231..    1981/1982  AZ, ID, NM, OK, OR, SD, UT, WY....................       5.85      60.07     62.91     61.49      8.86     17.79     13.32      8.19
232..    1981/1982  AZ, LA, MT, NM, OK, UT, WY........................       6.17      58.76     63.41     61.09      9.53     17.29     13.41      8.19
233..    1981/1982  AZ, IA, LA, NM, OK, SD, UT, WY....................       7.41      58.76     63.43     61.10      9.53     17.28     13.40      8.19
234..    1981/1983  AZ, ID, MT, ND, NM, OK, SD, UT, WY................       5.32      57.75     62.49     60.12      9.42     17.82     13.62      8.19
235..    1982/1983  AR, AZ, MS, NM, OK, UT, WY........................       6.08      59.89     62.16     61.02      9.29     17.54     13.41      8.19
236..    1981/1984  IA, KS, MT, NE, OK, UT, WY........................       5.56      59.78     64.65     62.22      8.52     17.80     13.16      8.19
237..    1981/1984  IA, KS, MT, ND, NE, OK, SD, UT, WY................       6.15      59.72     64.67     62.20      8.58     17.73     13.16      8.18
238..    1981/1982  AR, KS, MS, MT, ND, NE, OK, UT, WY................       6.68      59.80     65.01     62.41      9.28     16.95     13.11      8.18
239..    1982/1983  AZ, LA, MT, ND, NM, OK, UT, WY....................       6.45      59.16     62.15     60.66      9.94     17.04     13.49      8.18
240..    1982/1983  IA, ID, KS, NE, OK, UT, WY........................       5.63      58.50     63.74     61.12      9.19     17.58     13.39      8.18
241..    1982/1983  AR, KS, MS, MT, NE, OK, UT, WY....................       6.39      59.24     63.20     61.22      9.31     17.42     13.37      8.18
242..    1982/1984  AR, KS, NE, OK, SD, UT, WY........................       5.24      59.89     64.37     62.13      8.79     17.55     13.17      8.18
243..    1982/1983  AZ, LA, NM, OK, SD, UT, WY........................       6.12      59.21     62.14     60.68      9.97     16.99     13.48      8.18
244..    1981/1984  AR, KS, MT, ND, NE, OK, UT, WY....................       5.57      59.28     64.55     61.91      8.84     17.58     13.21      8.18
245..    1981/1983  AR, AZ, IA, ND, NM, OK, SD, UT, WY................       6.85      59.18     62.53     60.85      9.00     17.87     13.44      8.18
246..    1981/1982  AR, IA, KS, MS, NE, OK, UT, WY....................       7.33      59.80     65.03     62.42      9.25     16.95     13.10      8.18
247..    1981/1982  AZ, ID, MT, ND, NM, OK, OR, UT, WY................       6.18      60.07     62.91     61.49      8.79     17.80     13.30      8.18
248..    1982/1983  AZ, ID, ND, NE, NM, OK, SD, UT, WY................       5.67      59.07     62.62     60.84      9.45     17.42     13.44      8.18
249..    1981/1982  AR, AZ, LA, MT, ND, NM, OK, UT, WY................       7.46      58.84     63.52     61.18      9.52     17.20     13.36      8.17
250..    1981/1982  AR, AZ, IA, LA, ND, NM, OK, SD, UT, WY............       8.71      58.84     63.54     61.19      9.52     17.19     13.36      8.17
251..    1982/1984  AR, KS, MT, NE, OK, SD, UT, WY....................       5.59      59.94     64.36     62.15      8.75     17.55     13.15      8.17
252..    1981/1984  IA, KS, NE ,OK, SD, UT, WY........................       5.52      59.67     64.68     62.17      8.55     17.73     13.14      8.17
253..    1981/1982  AR, AZ, ID, ND, NM, OK, OR, SD, UT, WY............       7.14      60.15     63.08     61.62      8.86     17.66     13.26      8.17
254..    1981/1982  AR, KS, MS, MT, ND, NE, OK, SD, UT, WY............       6.99      59.80     65.01     62.41      9.25     16.92     13.09      8.17
255..    1981/1983  AZ, ID, MT, NM, OK, SD, UT, WY....................       5.03      57.75     62.48     60.12      9.36     17.81     13.58      8.17
256..    1981/1982  AR, AZ, ID, NM, OK, OR, UT, WY....................       6.55      60.15     63.08     61.61      8.84     17.67     13.25      8.17
257..    1981/1984  AR, KS, ND, NE, OK, SD, UT, WY....................       5.53      59.16     64.58     61.87      8.88     17.51     13.20      8.16
258..    1981/1983  ID, KS, ND, NE, OK, OR, SD, UT, WY................       6.10      57.08     63.70     60.39      9.57     17.47     13.52      8.16
259..    1981/1982  AZ, ID, ND, NE, NM, OK, SD, UT, WY................       5.67      60.16     63.21     61.69      8.96     17.51     13.23      8.16
260..    1981/1982  AR, AZ, LA, MT, ND, NM, OK, SD, UT, WY............       7.77      58.84     63.52     61.18      9.50     17.19     13.34      8.16
261..    1982/1983  AZ, LA, MT, NM, OK, UT, WY........................       6.17      59.16     62.14     60.65      9.89     17.03     13.46      8.16
262..    1981/1982  AR, KS, MS, MT, NE, OK, UT, WY....................       6.39      59.80     65.01     62.40      9.23     16.93     13.08      8.16
263..    1982/1983  AZ, ID, NE, NM, OK, UT, WY........................       5.07      59.07     62.60     60.84      9.38     17.45     13.42      8.16
264..    1981/1983  AR, AZ, NE, NM, OK, UT, WY........................       5.66      59.17     62.44     60.81      9.19     17.65     13.42      8.16
265..    1981/1982  AR, AZ, LA, MT, NM, OK, UT, WY....................       7.18      58.84     63.51     61.18      9.48     17.19     13.34      8.16
266..    1981/1982  AZ, ID, NE, NM, OK, UT, WY........................       5.07      60.16     63.20     61.68      8.94     17.51     13.23      8.16

[[Page 29611]]

                                                                                                                                                        
267..    1981/1982  AR, AZ, IA, LA, NM, OK, SD, UT, WY................       8.42      58.84     63.53     61.19      9.48     17.18     13.33      8.16
268..    1981/1984  IA, KS, MT, NE, OK, SD, UT, WY....................       5.86      59.72     64.66     62.19      8.51     17.72     13.12      8.16
269..    1983/1984  IA, KS, MT, NE, OK, UT, WY........................       5.50      59.42     63.35     61.38      8.26     18.31     13.29      8.15
270..    1981/1983  ID, KS, NE, OK, OR, UT, WY........................       5.50      57.08     63.69     60.38      9.51     17.50     13.50      8.15
271..    1981/1983  AR, AZ, IA, NM, OK, SD, UT, WY....................       6.56      59.18     62.52     60.85      8.94     17.86     13.40      8.15
272..    1981/1983  AR, AZ, IA, MT, ND, NM, OK, SD, UT, WY............       7.20      59.13     62.52     60.83      8.93     17.87     13.40      8.15
273..    1981/1984  AR, KS, MT, NE, OK, UT, WY........................       5.28      59.27     64.54     61.91      8.76     17.57     13.17      8.15
274..    1981/1984  AR, KS, MT, ND, NE, OK, SD, UT, WY................       5.87      59.22     64.56     61.89      8.83     17.51     13.17      8.15
275..    1982/1983  AZ, ID, NE, NM, OK, SD, UT, WY....................       5.38      59.07     62.60     60.84      9.39     17.41     13.40      8.15
276..    1982/1983  ID, KS, ND, NE, OK, OR, SD, UT, WY................       6.10      58.08     63.58     60.83      9.60     17.19     13.40      8.15
277..    1982/1983  AZ, ID, MT, ND, NE, NM, OK, SD, UT, WY............       6.01      59.02     62.61     60.82      9.37     17.43     13.40      8.15
278..    1983/1984  IA, KS, NE, OK, UT, WY............................       5.15      59.33     63.35     61.34      8.27     18.30     13.28      8.15
279..    1981/1983  ID, KS, MT, ND, NE, OK, OR, UT, WY................       6.14      57.05     63.69     60.37      9.48     17.51     13.50      8.15
280..    1982/1983  AR, AZ, IA, NE, NM, OK, UT, WY....................       6.95      60.75     62.46     61.60      8.85     17.60     13.23      8.15
281..    1981/1983  AZ, MS, ND, NM, OK, SD, UT, WY....................       5.67      58.59     62.05     60.32      9.31     17.69     13.50      8.15
282..    1981/1982  AZ, ID, NE, NM, OK, SD, UT, WY....................       5.38      60.16     63.20     61.68      8.91     17.49     13.20      8.14
283..    1981/1982  IA, ID, MT, ND, NV, OR, SD, UT, WY................       5.01      53.95     54.79     54.37      8.45     21.51     14.98      8.14
284..    1981/1983  IA, ID, KS, NE, OK, UT, WY........................       5.63      57.57     64.03     60.80      9.19     17.60     13.39      8.14
285..    1981/1983  ID, KS, NE, OK, OR, SD, UT, WY....................       5.81      57.08     63.69     60.38      9.51     17.45     13.48      8.14
286..    1981/1982  AZ, LA, NE, NM, OK, UT, WY........................       6.51      58.82     63.38     61.10      9.53     17.12     13.32      8.14
287..    1982/1983  AZ, IA, ID, NM, OK, SD, UT, WY....................       5.97      59.12     62.59     60.85      9.10     17.65     13.37      8.14
288..    1981/1982  AR, AZ, ID, MT, ND, NM, OK, OR, UT, WY............       7.19      60.15     63.07     61.61      8.75     17.66     13.21      8.14
289..    1982/1983  ID, KS, NE, OK, OR, UT, WY........................       5.50      58.08     63.57     60.82      9.54     17.22     13.38      8.14
290..    1982/1983  ID, KS, MT, ND, NE, OK, OR, UT, WY................       6.14      58.04     63.57     60.81      9.51     17.25     13.38      8.14
291..    1981/1984  AR, KS, NE, OK, SD, UT, WY........................       5.24      59.15     64.57     61.86      8.81     17.50     13.15      8.14
292..    1982/1983  AZ, ID, MT, NE, NM, OK, UT, WY....................       5.42      59.02     62.60     60.81      9.30     17.46     13.38      8.14
293..    1981/1983  AZ, LA, ND, NM, OK, SD, UT, WY....................       6.41      58.07     62.15     60.11      9.84     17.22     13.53      8.13
294..    1981/1983  ID, KS, MT, ND, NE, OK, OR, SD, UT, WY............       6.44      57.05     63.69     60.37      9.48     17.47     13.48      8.13
295..    1981/1982  AR, AZ, IA, ID, ND, NM, OK, OR, SD, UT, WY........       8.43      60.15     63.10     61.63      8.75     17.65     13.20      8.13
296..    1983/1984  IA, KS, MT, ND, NE, OK, SD, UT, WY................       6.07      59.33     63.39     61.36      8.34     18.17     13.25      8.13
297..    1982/1983  AZ, ID, ND, NM, OK, OR, SD, UT, WY................       6.13      58.69     62.47     60.58      9.49     17.35     13.42      8.13
298..    1981/1982  AZ, LA, NE, NM, OK, SD, UT, WY....................       6.82      58.82     63.38     61.10      9.50     17.10     13.30      8.13
299..    1981/1982  AZ, ID, LA, NM, OK, UT, WY........................       6.24      57.99     63.27     60.63      9.62     17.20     13.41      8.13
300..    1981/1983  AZ, MS, MT, ND, NM, OK, UT, WY....................       5.71      58.55     62.04     60.30      9.23     17.73     13.48      8.13
301..    1982/1983  AR, AZ, NM, NV, OK, UT, WY........................       5.32      59.63     61.70     60.67      9.10     17.70     13.40      8.13
302..    1981/1983  AR, AZ, IA, MT, NM, OK, SD, UT, WY................       6.91      59.13     62.51     60.82      8.87     17.86     13.36      8.13
303..    1981/1982  AR, AZ, IA, LA, MT, ND, NM, OK, SD, UT, WY........       9.06      58.84     63.53     61.18      9.38     17.18     13.28      8.13
304..    1982/1983  AZ, MS, NE, NM, OK, UT, WY........................       5.77      59.83     62.29     61.06      9.18     17.43     13.31      8.13
305..    1983/1984  IA, KS, ND, NE, OK, SD, UT, WY....................       5.73      59.24     63.39     61.32      8.35     18.15     13.25      8.13
306..    1981/1982  AR, AZ, ID, MT, ND, NM, OK, OR, SD, UT, WY........       7.49      60.15     63.07     61.61      8.73     17.64     13.19      8.12
307..    1981/1983  ID, KS, MT, NE, OK, OR, UT, WY....................       5.85      57.05     63.68     60.36      9.42     17.50     13.46      8.12
308..    1981/1983  AR, KS, MS, ND, NE, OK, SD, UT, WY................       6.64      58.40     63.31     60.86      9.43     17.27     13.35      8.12
309..    1982/1983  ID, KS, NE, OK, OR, SD, UT, WY....................       5.81      58.08     63.57     60.82      9.54     17.17     13.36      8.12
310..    1982/1983  ID, KS, MT, ND, NE, OK, OR, SD, UT, WY............       6.44      58.04     63.57     60.81      9.52     17.20     13.36      8.12
311..    1982/1983  AR, AZ, LA, ND, NM, OK, SD, UT, WY................       7.42      59.26     62.04     60.65      9.91     16.87     13.39      8.12
312..    1981/1984  AR, KS, MT, NE, OK, SD, UT, WY....................       5.59      59.21     64.56     61.88      8.76     17.49     13.13      8.12
313..    1981/1983  AZ, MS, NM, OK, SD, UT, WY........................       5.38      58.59     62.04     60.31      9.26     17.68     13.47      8.12
314..    1982/1983  AR, CO, ND, OK, SD, UT, WY........................       5.07      59.32     62.38     60.85      9.44     17.26     13.35      8.12

[[Page 29612]]

                                                                                                                                                        
315..    1981/1982  AR, AZ, ID, MT, NM, OK, OR, UT, WY................       6.90      60.15     63.06     61.61      8.71     17.65     13.18      8.12
316..    1981/1982  AZ, IA, ID, NE, NM, OK, UT, WY....................       6.36      60.16     63.22     61.69      8.82     17.50     13.16      8.12
317..    1981/1983  AR, AZ, ID, NM, OK, UT, WY........................       5.39      57.85     62.38     60.11      9.34     17.67     13.51      8.12
318..    1982/1983  AZ, ID, NM, OK, OR, UT, WY........................       5.54      58.69     62.45     60.57      9.43     17.38     13.40      8.12
319..    1982/1983  AZ, ID, MT, ND, NM, OK, OR, UT, WY................       6.18      58.65     62.46     60.55      9.41     17.40     13.41      8.12
320..    1981/1983  AZ, LA, MT, ND, NM, OK, UT, WY....................       6.45      58.04     62.15     60.09      9.76     17.25     13.51      8.12
321..    1981/1983  AZ, LA, NM, OK, SD, UT, WY........................       6.12      58.07     62.15     60.11      9.80     17.21     13.50      8.12
322..    1983/1984  AR, KS, LA, MT, ND, NE, OK, UT, WY................       7.42      59.14     63.99     61.57      8.92     17.44     13.18      8.11
323..    1982/1983  AZ, MS, NE, NM, OK, SD, UT, WY....................       6.07      59.83     62.29     61.06      9.19     17.39     13.29      8.11
324..    1982/1983  AR, KS, LA, ND, NE, OK, SD, UT, WY................       7.38      58.73     62.73     60.73     10.02     16.70     13.36      8.11
325..    1981/1982  AZ, ID, MT, ND, NE, NM, OK, SD, UT, WY............       6.01      60.16     63.19     61.68      8.82     17.49     13.16      8.11
326..    1981/1983  AR, KS, MS, NE, OK, UT, WY........................       6.05      58.40     63.30     60.85      9.37     17.30     13.33      8.11
327..    1980/1983  AR, KS, ND, NE, OK, SD, UT, WY....................       5.53      57.40     63.11     60.26      9.68     17.24     13.46      8.11
328..    1982/1983  AR, AZ, LA, NM, OK, UT, WY........................       6.83      59.26     62.03     60.64      9.86     16.89     13.38      8.11
329..    1982/1983  ID, KS, MT, NE, OK, OR, UT, WY....................       5.85      58.04     63.56     60.80      9.45     17.23     13.34      8.11
330..    1981/1983  AZ, IA, ND, NE, NM, OK, SD, UT, WY................       6.54      59.16     62.57     60.86      8.9

FR Doc. 96-14496 Office of Federal Housing Enterprise Oversight; Risk-Based Capital

0     17.76     13.33      8.11
331..    1981/1982  AZ, ID, MT, NE, NM, OK, UT, WY....................       5.42      60.16     63.19     61.67      8.80     17.50     13.15      8.11
332..    1981/1983  AR, KS, MS, MT, ND, NE, OK, UT, WY................       6.68      58.36     63.30     60.83      9.34     17.32     13.33      8.11
333..    1982/1983  AR, AZ, LA, MT, ND, NM, OK, UT, WY................       7.46      59.21     62.04     60.63      9.83     16.91     13.37      8.11
334..    1982/1983  AZ, ID, NM, OK, OR, SD, UT, WY....................       5.85      58.69     62.45     60.57      9.43     17.34     13.38      8.11
335..    1981/1983  AR, KS, LA, ND, NE, OK, SD, UT, WY................       7.38      57.89     62.99     60.44      9.95     16.87     13.41      8.11
336..    1981/1983  AZ, MS, MT, NM, OK, UT, WY........................       5.42      58.55     62.03     60.29      9.17     17.72     13.44      8.11
337..    1983/1984  IA, KS, MT, NE, OK, SD, UT, WY....................       5.79      59.33     63.37     61.35      8.26     18.16     13.21      8.10
338..    1982/1983  AR, AZ, MT, NM, NV, OK, UT, WY....................       5.67      59.58     61.70     60.64      9.02     17.71     13.36      8.10
339..    1982/1983  AR, AZ, LA, NM, OK, SD, UT, WY....................       7.13      59.26     62.03     60.64      9.86     16.86     13.36      8.10
340..    1981/1982  AZ, IA, LA, NE, NM, OK, UT, WY....................       7.80      58.82     63.39     61.11      9.41     17.12     13.26      8.10
341..    1982/1983  AR, KS, LA, NE, OK, UT, WY........................       6.79      58.73     62.72     60.72      9.97     16.72     13.34      8.10
342..    1982/1983  AZ, MS, MT, NE, NM, OK, UT, WY....................       6.12      59.78     62.29     61.03      9.11     17.45     13.28      8.10
343..    1982/1984  AR, KS, LA, MT, ND, NE, OK, UT, WY................       7.43      59.36     64.65     62.00      9.17     16.96     13.06      8.10
344..    1981/1983  AR, KS, MS, NE, OK, SD, UT, WY....................       6.35      58.40     63.30     60.85      9.37     17.26     13.31      8.10
345..    1981/1983  AZ, IA, NE, NM, OK, UT, WY........................       5.94      59.16     62.55     60.86      8.83     17.78     13.31      8.10
346..    1982/1983  AR, AZ, LA, MT, ND, NM, OK, SD, UT, WY............       7.77      59.21     62.04     60.63      9.83     16.88     13.36      8.10
347..    1981/1983  AZ, LA, MT, NM, OK, UT, WY........................       6.17      58.04     62.14     60.09      9.72     17.24     13.48      8.10
348..    1982/1983  AR, KS, LA, MT, ND, NE, OK, UT, WY................       7.43      58.68     62.72     60.70      9.94     16.75     13.34      8.10
349..    1983/1984  IA, KS, NE, OK, SD, UT, WY........................       5.44      59.24     63.37     61.31      8.27     18.14     13.21      8.10
350..    1982/1984  AR, IA, KS, MT, ND, NE, OK, UT, WY................       6.86      60.35     64.26     62.31      8.40     17.60     13.00      8.10
351..    1981/1983  AR, KS, LA, NE, OK, UT, WY........................       6.79      57.89     62.98     60.44      9.91     16.89     13.40      8.10
352..    1981/1983  AR, KS, MS, MT, ND, NE, OK, SD, UT, WY............       6.99      58.36     63.30     60.83      9.34     17.27     13.31      8.10
353..    1981/1983  AZ, MS, MT, NM, OK, SD, UT, WY....................       5.73      58.55     62.03     60.29      9.17     17.68     13.43      8.09
354..    1982/1983  AR, KS, LA, NE, OK, SD, UT, WY....................       7.09      58.73     62.72     60.72      9.97     16.69     13.33      8.09
355..    1983/1984  AR, KS, LA, MT, NE, OK, UT, WY....................       7.14      59.14     63.99     61.56      8.86     17.43     13.15      8.09
356..    1981/1982  AZ, LA, MT, NE, NM, OK, UT, WY....................       6.86      58.82     63.37     61.09      9.39     17.11     13.25      8.09
357..    1983/1984  AR, KS, LA, NE, OK, UT, WY........................       6.79      59.06     63.99     61.52      8.88     17.42     13.15      8.09
358..    1982/1983  AR, KS, LA, MT, ND, NE, OK, SD, UT, WY............       7.73      58.68     62.72     60.70      9.94     16.71     13.33      8.09
359..    1982/1984  AR, KS, LA, NE, OK, UT, WY........................       6.79      59.31     64.65     61.98      9.15     16.95     13.05      8.09
360..    1982/1984  AR, KS, LA, ND, NE, OK, SD, UT, WY................       7.38      59.26     64.66     61.96      9.21     16.90     13.05      8.09
361..    1981/1983  AR, KS, LA, MT, ND, NE, OK, UT, WY................       7.43      57.85     62.99     60.42      9.87     16.90     13.39      8.09
362..    1980/1983  AR, KS, NE, OK, SD, UT, WY........................       5.24      57.48     63.09     60.29      9.60     17.23     13.41      8.09

[[Page 29613]]

                                                                                                                                                        
363..    1981/1983  AZ, IA, NE, NM, OK, SD, UT, WY....................       6.25      59.16     62.55     60.86      8.83     17.74     13.29      8.09
364..    1982/1983  AR, AZ, LA, MT, NM, OK, UT, WY....................       7.18      59.21     62.02     60.62      9.78     16.90     13.34      8.09
365..    1981/1982  AZ, MS, ND, NM, OK, SD, UT, WY....................       5.67      60.35     62.69     61.52      8.67     17.62     13.15      8.09
366..    1981/1983  AR, KS, LA, NE, OK, SD, UT, WY....................       7.09      57.89     62.98     60.44      9.90     16.86     13.38      8.09
367..    1981/1982  AZ, ID, NE, NM, OK, OR, UT, WY....................       6.23      60.14     62.86     61.50      8.74     17.56     13.15      8.09
368..    1981/1983  AR, KS, MS, MT, NE, OK, UT, WY....................       6.39      58.36     63.29     60.82      9.28     17.30     13.29      8.08
369..    1981/1983  AZ, ID, ND, NM, OK, OR, SD, UT, WY................       6.13      57.36     62.24     59.80      9.34     17.69     13.52      8.08
370..    1983/1984  AR, KS, LA, MT, ND, NE, OK, SD, UT, WY............       7.72      59.07     64.01     61.54      8.92     17.35     13.13      8.08
371..    1983/1984  AR, KS, MT, ND, NE, OK, UT, WY....................       5.57      58.54     62.99     60.77      8.60     17.99     13.30      8.08
372..    1982/1984  AR, KS, LA, MT, NE, OK, UT, WY....................       7.14      59.36     64.64     62.00      9.11     16.95     13.03      8.08
373..    1982/1984  AR, KS, LA, MT, ND, NE, OK, SD, UT, WY............       7.73      59.31     64.66     61.98      9.17     16.90     13.03      8.08
374..    1983/1984  AR, KS, LA, ND, NE, OK, SD, UT, WY................       7.37      59.00     64.01     61.50      8.94     17.34     13.14      8.08
375..    1980/1982  IA, KS, ND, NE, OK, SD, UT, WY....................       5.80      58.14     64.10     61.12      9.75     16.68     13.22      8.08
376..    1981/1983  AR, KS, LA, MT, ND, NE, OK, SD, UT, WY............       7.73      57.85     62.99     60.42      9.87     16.87     13.37      8.08
377..    1982/1983  AR, KS, LA, MT, NE, OK, UT, WY....................       7.14      58.68     62.71     60.70      9.88     16.73     13.31      8.08
378..    1981/1984  AR, KS, LA, MT, ND, NE, OK, UT, WY................       7.43      58.84     64.49     61.66      9.15     17.05     13.10      8.08
379..    1982/1984  AR, IA, KS, NE, OK, UT, WY........................       6.22      60.31     64.25     62.28      8.35     17.58     12.97      8.08
380..    1981/1983  AZ, IA, MT, NE, NM, OK, UT, WY....................       6.29      59.12     62.55     60.83      8.76     17.78     13.27      8.07
381..    1982/1984  AR, IA, KS, ND, NE, OK, SD, UT, WY................       6.81      60.24     64.28     62.26      8.43     17.50     12.97      8.07
382..    1981/1983  AZ, ID, NM, OK, OR, UT, WY........................       5.54      57.36     62.23     59.80      9.29     17.71     13.50      8.07
383..    1981/1984  AR, KS, LA, ND, NE, OK, SD, UT, WY................       7.38      58.75     64.50     61.62      9.19     17.00     13.10      8.07
384..    1982/1983  CO, IA, ND, OK, SD, UT, WY........................       5.34      59.30     62.51     60.91      9.10                              
                                                                                                                     17.40     13.25      8.07          
385..    1982/1984  AR, IA, KS, MT, NE, OK, UT, WY....................       6.57      60.36     64.25     62.30      8.32     17.58     12.95      8.07
386..    1982/1983  AZ, NE, NM, NV, OK, UT, WY........................       5.01      59.57     61.82     60.70      8.99     17.60     13.29      8.07
387..    1982/1983  AR, KS, LA, MT, NE, OK, SD, UT, WY................       7.44      58.68     62.71     60.70      9.89     16.70     13.29      8.07
388..    1981/1983  AR, KS, LA, MT, NE, OK, UT, WY....................       7.14      57.85     62.98     60.42      9.82     16.89     13.36      8.07
389..    1981/1983  AR, AZ, LA, ND, NM, OK, SD, UT, WY................       7.42      58.12     62.09     60.11      9.74     17.11     13.42      8.07
390..    1981/1984  AR, KS, LA, NE, OK, UT, WY........................       6.79      58.78     64.49     61.64      9.14     17.04     13.09      8.07
391..    1981/1982  AZ, MS, NM, OK, SD, UT, WY........................       5.38      60.35     62.68     61.52      8.62     17.61     13.11      8.07
392..    1981/1983  AR, ID, KS, ND, NE, OK, OR, SD, UT, WY............       7.11      57.14     63.55     60.34      9.45     17.29     13.37      8.07
393..    1980/1982  AR, KS, ND, NE, OK, SD, UT, WY....................       5.53      57.87     64.28     61.08      9.79     16.63     13.21      8.07
394..    1981/1983  AZ, ID, MT, ND, NM, OK, OR, UT, WY................       6.18      57.33     62.24     59.78      9.26     17.72     13.49      8.07
395..    1982/1984  AR, KS, LA, NE, OK, SD, UT, WY....................       7.09      59.25     64.66     61.96      9.15     16.89     13.02      8.07
396..    1980/1982  IA, KS, NE, OK, UT, WY............................       5.21      58.26     64.09     61.18      9.68     16.70     13.19      8.07
397..    1982/1984  AR, IA, KS, MT, ND, NE, OK, SD, UT, WY............       7.16      60.29     64.27     62.28      8.40     17.50     12.95      8.07
398..    1980/1983  AR, KS, MT, ND, NE, OK, UT, WY....................       5.57      57.32     63.10     60.21      9.52     17.27     13.39      8.06
399..    1981/1983  AZ, IA, MT, NE, NM, OK, SD, UT, WY................       6.59      59.12     62.55     60.83      8.76     17.74     13.25      8.06
400..    1981/1983  AZ, ID, ND, NE, NM, OK, SD, UT, WY................       5.67      57.83     62.43     60.13      9.28     17.53     13.41      8.06
401..    1982/1983  AZ, LA, NE, NM, OK, UT, WY........................       6.51      59.21     62.12     60.66      9.76     16.81     13.29      8.06
402..    1982/1984  ID, KS, MT, ND, NE, OK, SD, UT, WY................       5.28      58.62     64.35     61.49      8.90     17.32     13.11      8.06
403..    1981/1983  AZ, ID, NM, OK, OR, SD, UT, WY....................       5.85      57.36     62.23     59.80      9.29     17.68     13.48      8.06
404..    1983/1984  AR, KS, LA, MT, NE, OK, SD, UT, WY................       7.43      59.06     64.00     61.53      8.86     17.34     13.10      8.06
405..    1981/1983  AR, KS, LA, MT, NE, OK, SD, UT, WY................       7.44      57.85     62.98     60.42      9.82     16.86     13.34      8.06
406..    1981/1984  AR, KS, LA, MT, ND, NE, OK, SD, UT, WY............       7.73      58.80     64.49     61.65      9.15     17.00     13.07      8.06
407..    1981/1984  AR, IA, KS, MT, ND, NE, OK, UT, WY................       6.86      59.63     64.52     62.07      8.42     17.54     12.98      8.06
408..    1981/1983  AR, AZ, LA, NM, OK, UT, WY........................       6.83      58.12     62.08     60.10      9.69     17.12     13.41      8.06

[[Page 29614]]

                                                                                                                                                        
409..    1982/1984  AR, KS, LA, MT, NE, OK, SD, UT, WY................       7.44      59.30     64.65     61.98      9.11     16.89     13.00      8.06
410..    1982/1983  AZ, NE, NM, NV, OK, SD, UT, WY....................       5.31      59.57     61.82     60.70      9.00     17.56     13.28      8.06
411..    1980/1983  IA, KS, ND, NE, OK, SD, UT, WY....................       5.80      57.66     63.24     60.45      9.33     17.33     13.33      8.06
412..    1983/1984  AR, KS, LA, NE, OK, SD, UT, WY....................       7.09      58.99     64.00     61.50      8.88     17.33     13.10      8.06
413..    1981/1983  AR, ID, KS, NE, OK, OR, UT, WY....................       6.51      57.14     63.54     60.34      9.40     17.31     13.35      8.06
414..    1981/1984  AR, KS, LA, MT, NE, OK, UT, WY....................       7.14      58.84     64.48     61.66      9.10     17.03     13.07      8.06
415..    1983/1984  AR, CO, LA, MT, OK, WY............................       6.11      57.89     63.92     60.90      9.04     17.41     13.23      8.06
416..    1981/1982  AZ, ID, LA, NM, OK, OR, UT, WY....................       7.40      58.01     63.04     60.53      9.38     17.24     13.31      8.06
417..    1981/1982  AZ, MS, MT, ND, NM, OK, UT, WY....................       5.71      60.35     62.67     61.51      8.56     17.63     13.09      8.05
418..    1980/1982  IA, KS, ND, NE, OK, SD, WY........................       5.16      58.40     65.54     61.97      9.08     16.91     13.00      8.05
419..    1982/1983  AZ, LA, NE, NM, OK, SD, UT, WY....................       6.82      59.21     62.12     60.66      9.77     16.78     13.27      8.05
420..    1981/1984  ID, KS, MT, ND, NE, OK, SD, UT, WY................       5.28      58.04     64.45     61.24      8.90     17.39     13.15      8.05
421..    1981/1983  AR, ID, KS, MT, ND, NE, OK, OR, UT, WY............       7.15      57.11     63.54     60.32      9.37     17.33     13.35      8.05
422..    1983/1984  AR, KS, MT, NE, OK, UT, WY........................       5.29      58.53     62.98     60.75      8.53     17.98     13.25      8.05
423..    1980/1982  IA, KS, NE, OK, SD, UT, WY........................       5.52      58.26     64.09     61.18      9.66     16.67     13.16      8.05
424..    1981/1983  AR, AZ, LA, MT, ND, NM, OK, UT, WY................       7.46      58.09     62.09     60.09      9.66     17.14     13.40      8.05
425..    1982/1983  AZ, IA, NM, NV, OK, SD, UT, WY....................       5.91      59.62     61.81     60.71      8.73     17.79     13.26      8.05
426..    1980/1983  AR, KS, MT, ND, NE, OK, SD, UT, WY................       5.87      57.32     63.10     60.21      9.51     17.23     13.37      8.05
427..    1981/1983  AR, AZ, LA, NM, OK, SD, UT, WY....................       7.13      58.12     62.08     60.10      9.69     17.10     13.39      8.05
428..    1981/1983  AZ, ID, NE, NM, OK, UT, WY........................       5.07      57.83     62.41     60.12      9.22     17.56     13.39      8.05
429..    1981/1984  AR, KS, LA, NE, OK, SD, UT, WY....................       7.09      58.74     64.50     61.62      9.14     16.99     13.06      8.05
430..    1981/1983  AR, AZ, MS, NM, OK, UT, WY........................       6.08      58.64     61.94     60.29      9.15     17.55     13.35      8.05
431..    1980/1983  IA, KS, NE, OK, UT, WY............................       5.21      57.74     63.22     60.48      9.26     17.36     13.31      8.05
432..    1981/1983  AZ, IA, ID, NM, OK, SD, UT, WY....................       5.97      57.84     62.50     60.17      8.98     17.77     13.37      8.05
433..    1982/1983  AZ, MT, NE, NM, NV, OK, UT, WY....................       5.36      59.52     61.82     60.67      8.92     17.61     13.26      8.05
434..    1982/1984  AR, IA, KS, NE, OK, SD, UT, WY....................       6.52      60.25     64.27     62.26      8.35     17.49     12.92      8.04
435..    1981/1983  AR, AZ, LA, MT, ND, NM, OK, SD, UT, WY............       7.77      58.09     62.09     60.09      9.66     17.11     13.39      8.04
436..    1981/1984  AR, IA, KS, ND, NE, OK, SD, UT, WY................       6.81      59.52     64.54     62.03      8.45     17.48     12.97      8.04
437..    1981/1984  AR, IA, KS, NE, OK, UT, WY........................       6.22      59.57     64.52     62.05      8.39     17.54     12.96      8.04
438..    1982/1983  AR, ID, KS, ND, NE, OK, OR, SD, UT, WY............       7.11      58.15     63.36     60.75      9.49     16.99     13.24      8.04
439..    1981/1982  AR, AZ, MS, NM, OK, UT, WY........................       6.08      60.43     62.85     61.64      8.60     17.49     13.05      8.04
440..    1981/1983  AR, ID, KS, MT, ND, NE, OK, OR, SD, UT, WY........       7.45      57.11     63.54     60.32      9.37     17.29     13.33      8.04
441..    1980/1983  AR, KS, MT, NE, OK, UT, WY........................       5.28      57.39     63.08     60.24      9.44     17.26     13.35      8.04
442..    1981/1983  AZ, ID, NE, NM, OK, SD, UT, WY....................       5.38      57.83     62.41     60.12      9.22     17.52     13.37      8.04
443..    1981/1984  AR, KS, LA, MT, NE, OK, SD, UT, WY................       7.44      58.79     64.49     61.64      9.10     16.99     13.04      8.04
444..    1982/1984  AR, IA, KS, MT, NE, OK, SD, UT, WY................       6.87      60.30     64.26     62.28      8.32     17.49     12.91      8.04
445..    1982/1983  AZ, LA, MT, NE, NM, OK, UT, WY....................       6.86      59.16     62.12     60.64      9.69     16.82     13.25      8.04
446..    1980/1982  AR, KS, NE, OK, SD, UT, WY........................       5.24      57.99     64.27     61.13      9.68     16.61     13.15      8.04
447..    1982/1983  AZ, ID, MS, NM, OK, UT, WY........................       5.49      58.35     62.24     60.30      9.33     17.33     13.33      8.04
448..    1980/1982  AR, IA, KS, ND, NE, OK, SD, UT, WY................       6.81      58.12     64.26     61.19      9.72     16.55     13.13      8.04
449..    1982/1983  AR, AZ, ID, ND, NM, OK, OR, SD, UT, WY............       7.14      58.75     62.30     60.53      9.38     17.17     13.28      8.04
450..    1982/1983  AR, IA, KS, MS, NE, OK, UT, WY....................       7.33      59.34     63.13     61.24      8.90     17.34     13.12      8.04
451..    1981/1982  AZ, MS, MT, NM, OK, UT, WY........................       5.42      60.35     62.67     61.51      8.52     17.61     13.06      8.04
452..    1981/1982  AR, LA, MS, OK....................................       5.31      59.66     64.99     62.32     10.64     15.15     12.89      8.03
453..    1981/1983  AZ, ID, MT, ND, NE, NM, OK, SD, UT, WY............       6.01      57.79     62.42     60.11      9.20     17.53     13.37      8.03
454..    1980/1983  IA, KS, NE, OK, SD, UT, WY........................       5.52      57.74     63.22     60.48      9.26     17.31     13.28      8.03
455..    1981/1982  AZ, ID, LA, NE, NM, OK, UT, WY....................       6.93      58.05     63.23     60.64      9.47     17.02     13.25      8.03
456..    1981/1983  AR, AZ, LA, MT, NM, OK, UT, WY....................       7.18      58.09     62.08     60.08      9.62     17.12     13.37      8.03
457..    1983/1984  AR, KS, MT, ND, NE, OK, SD, UT, WY................       5.86      58.45     63.02     60.74      8.60     17.85     13.22      8.03
458..    1981/1984  AR, IA, KS, MT, NE, OK, UT, WY....................       6.57      59.63     64.51     62.07      8.35     17.53     12.94      8.03
459..    1981/1984  AR, IA, KS, MT, ND, NE, OK, SD, UT, WY............       7.16      59.57     64.53     62.05      8.42     17.47     12.94      8.03

[[Page 29615]]

                                                                                                                                                        
460..    1982/1983  AR, ID, KS, MT, ND, NE, OK, OR, UT, WY............       7.15      58.10     63.35     60.73      9.40     17.05     13.22      8.03
461..    1982/1983  AZ, NM, NV, OK, OR, UT, WY........................       5.48      59.17     61.68     60.43      9.05     17.53     13.29      8.03
462..    1982/1983  AR, ID, KS, NE, OK, OR, UT, WY....................       6.51      58.15     63.34     60.75      9.42     17.02     13.22      8.03
463..    1982/1983  AZ, IA, LA, NM, OK, SD, UT, WY....................       7.41      59.25     62.11     60.68      9.51     16.95     13.23      8.03
464..    1981/1983  AR, ID, KS, MT, NE, OK, OR, UT, WY................       6.86      57.11     63.52     60.32      9.31     17.31     13.31      8.03
465..    1982/1983  AZ, ID, MS, NM, OK, SD, UT, WY....................       5.80      58.35     62.24     60.30      9.33     17.29     13.31      8.03
466..    1983/1984  AR, KS, ND, NE, OK, SD, UT, WY....................       5.52      58.34     63.02     60.68      8.62     17.83     13.23      8.03
467..    1980/1983  AR, KS, MT, NE, OK, SD, UT, WY....................       5.59      57.39     63.08     60.24      9.44     17.21     13.32      8.03
468..    1980/1982  AR, IA, KS, NE, OK, UT, WY........................       6.22      58.24     64.26     61.25      9.64     16.56     13.10      8.02
469..    1982/1983  AR, AZ, ID, MT, ND, NM, OK, OR, UT, WY............       7.19      58.71     62.29     60.50      9.30     17.23     13.26      8.02
470..    1982/1983  AR, AZ, ID, NM, OK, OR, UT, WY....................       6.55      58.75     62.28     60.52      9.32     17.20     13.26      8.02
471..    1981/1982  AZ, MS, MT, NM, OK, SD, UT, WY....................       5.73      60.35     62.67     61.51      8.50     17.59     13.04      8.02
472..    1981/1983  AZ, ID, MT, NE, NM, OK, UT, WY....................       5.42      57.79     62.41     60.10      9.14     17.56     13.35      8.02
473..    1981/1982  AR, AZ, NM, NV, OK, UT, WY........................       5.32      59.85     62.05     60.95      8.52     17.79     13.16      8.02
474..    1980/1983  AR, LA, MS, OK....................................       5.31      57.99     62.81     60.40     11.31     15.24     13.28      8.02
475..    1982/1983  AZ, NM, NV, OK, OR, SD, UT, WY....................       5.78      59.17     61.68     60.43      9.05     17.49     13.27      8.02
476..    1980/1982  ID, KS, ND, NE, OK, OR, SD, UT, WY................       6.10      57.27     63.32     60.30      9.78     16.81     13.30      8.02
477..    1982/1983  AR, ID, KS, MT, ND, NE, OK, OR, SD, UT, WY........       7.45      58.10     63.35     60.73      9.40     17.00     13.20      8.02
478..    1981/1984  AR, IA, KS, NE, OK, SD, UT, WY....................       6.52      59.52     64.54     62.03      8.38     17.46     12.92      8.02
479..    1981/1983  AR, AZ, IA, NE, NM, OK, UT, WY....................       6.95      59.21     62.45     60.83      8.74     17.61     13.18      8.01
480..    1982/1983  AZ, ID, MS, MT, NM, OK, UT, WY....................       5.84      58.30     62.24     60.27      9.25     17.34     13.30      8.01
481..    1982/1983  AR, AZ, ID, MT, ND, NM, OK, OR, SD, UT, WY........       7.49      58.71     62.29     60.50      9.30     17.19     13.24      8.01
482..    1980/1982  AR, IA, KS, NE, OK, SD, UT, WY....................       6.52      58.24     64.26     61.25      9.62     16.53     13.08      8.01
483..    1982/1984  AR, AZ, LA, NM, OK................................       5.98      59.25     64.72     61.99      9.39     16.45     12.92      8.01
484..    1981/1982  AZ, IA, NM, NV, OK, SD, UT, WY....................       5.91      59.77     61.91     60.84      8.44     17.89     13.16      8.01
485..    1982/1983  AZ, MT, NM, NV, OK, OR, UT, WY....................       5.83      59.12     61.68     60.40      8.98     17.54     13.26      8.01
486..    1980/1982  ID, KS, NE, OK, OR, UT, WY........................       5.50      57.37     63.32     60.34      9.72     16.82     13.27      8.01
487..    1982/1983  AR, ID, KS, MT, NE, OK, OR, UT, WY................       6.86      58.10     63.34     60.72      9.34     17.03     13.18      8.01
488..    1981/1983  IA, ID, KS, NE, OK, OR, UT, WY....................       6.79      57.14     63.69     60.41      9.04     17.46     13.25      8.00
489..    1981/1984  AR, IA, KS, MT, NE, OK, SD, UT, WY................       6.87      59.57     64.52     62.05      8.35     17.45     12.90      8.00
490..    1981/1983  IA, ID, KS, MT, ND, NE, OK, OR, UT, WY............       7.42      57.11     63.69     60.40      9.03     17.47     13.25      8.00
491..    1981/1983  AZ, LA, NE, NM, OK, UT, WY........................       6.51      58.11     62.10     60.10      9.59     17.04     13.31      8.00
492..    1983/1984  AR, KS, MT, NE, OK, SD, UT, WY....................       5.58      58.43     63.00     60.72      8.53     17.83     13.18      8.00
493..    1980/1983  IA, KS, MT, ND, NE, OK, SD, UT, WY................       6.15      57.57     63.23     60.40      9.19     17.31     13.25      8.00
494..    1981/1983  AR, AZ, ID, ND, NM, OK, OR, SD, UT, WY............       7.14      57.42     62.15     59.79      9.24     17.53     13.38      8.00
495..    1982/1983  AR, AZ, ID, MT, NM, OK, OR, UT, WY................       6.90      58.71     62.28     60.49      9.24     17.21     13.22      8.00
496..    1982/1984  AZ, LA, MT, ND, NM, OK, UT, WY....................       6.45      58.20     63.79     60.99      9.17     17.06     13.11      8.00
497..    1981/1983  AR, AZ, NM, NV, OK, UT, WY........................       5.32      57.78     61.49     59.63      8.99     17.84     13.41      8.00
498..    1983/1984  AR, KS, NE, OK, SD, UT, WY........................       5.23      58.32     63.00     60.66      8.54     17.82     13.18      8.00
499..    1981/1982  AZ, NM, NV, OK, OR, UT, WY........................       5.48      59.75     61.57     60.66      8.41     17.96     13.18      8.00
500..    1981/1983  AZ, LA, NE, NM, OK, SD, UT, WY....................       6.82      58.11     62.10     60.10      9.59     17.01     13.30      7.99
--------------------------------------------------------------------------------------------------------------------------------------------------------

House Price Indexes

Introduction

    In implementing the risk-based capital stress test, the 1992 Act 
requires OFHEO to take seasoning of mortgages into account, in 
accordance with the CQHPI or any index of similar quality, authority, 
and public availability that is regularly used by the Federal 
Government.46 The 1992 Act defines ``seasoning'' as the change in 
the LTV ratio of a mortgage over time.47 Such changes result from 
changes in the principal balance of the mortgage and changes in the 
value of the property. Changes in the value of the underlying property 
usually will have a much greater impact than scheduled amortization or 
curtailments on the seasoning of mortgages, particularly during the 
early years of the loan. OFHEO proposes to use its house price

[[Page 29616]]

index, HPI,48 which is a weighted repeat transactions index based 
on Enterprise data, rather than the CQHPI.
---------------------------------------------------------------------------

    \46\ Section 1361(d)(1) (12 U.S.C. 4611(d)(1)).
    \47\ See note 20 above.
    \48\ ``House Price Index'' is a collective term that refers to 
all the subindexes described below.
---------------------------------------------------------------------------

Using an Index to Adjust for Seasoning

    The 1992 Act does not specify how an index should be used to 
account for the seasoning of Enterprise mortgages in the stress test. 
OFHEO proposes to account for the impact of changes in individual 
property values on the seasoning of single-family mortgages in the 
stress test based upon changes in the index used for the particular 
geographical area in which the property is located. In accounting for 
the changes in the distribution of current LTV ratios, OFHEO will also 
make adjustments for the scheduled amortization of the principal of the 
loan.
    In general, a house price index provides estimates of changes in 
the general level of values over time based on observations of the 
values of specific properties in a particular geographic area. The 
accuracy of an adjustment to the value of an individual property based 
on an index will depend significantly on the accuracy of the index for 
the particular market area in which the property is located. It also 
will depend upon the degree of similarity between the value-determining 
characteristics of that property and the properties from which the 
index is estimated.
    No matter how accurate an index, however, individual house values 
will appreciate at greater or lesser rates than the index over time. 
The longer the time period, the greater is the dispersion in changes of 
individual house values. That is one major reason why house prices can 
appreciate on the average, but mortgages on individual properties still 
default. OFHEO is studying alternative means to account for the 
increasing dispersion of rates of house price change that occur within 
a group of loans over time. OFHEO will address this issue in the second 
NPR.

Description of the HPI

    OFHEO began publishing the HPI in March 1996 using data provided by 
the Enterprises. The HPI is released approximately 2 months after the 
end of each quarter. This index is reported for the nation, and 
subindexes are reported for 9 U.S. Census Divisions, 50 states, and the 
District of Columbia.
    OFHEO calculates the HPI for each specified geographic area using 
repeated observations of housing values for individual single-family 
properties on which mortgages were originated and purchased by either 
Enterprise since 1975.49 There are now more than 6.9 million 
repeat transaction pairs in the national sample. The use of house price 
differentials computed from repeat transactions on the same properties 
controls for differences in the quality of the houses over time. For 
this reason, the HPI is described as a ``constant quality'' house price 
index. The HPI is updated each quarter as additional mortgages are 
purchased by the Enterprises through the identification of additional 
repeat transactions for the most recent quarter and all earlier 
quarters.
---------------------------------------------------------------------------

    \49\ A technical description of the HPI and the methodology used 
to create it has been published by OFHEO and is available from the 
agency upon request. Charles A. Calhoun, OFHEO House Price Indexes: 
HPI Technical Description (March 1996) (HPI Technical Description).
---------------------------------------------------------------------------

    The HPI provides broad geographic coverage by virtue of the 
national operations of the two Enterprises. There are, however, some 
limitations on the coverage of the HPI because it is produced using 
data on single-family, detached properties financed by conforming 
conventional mortgages purchased by the Enterprises. Thus, the HPI is 
not based upon any mortgage transactions on properties financed by 
government-insured loans, properties financed by mortgages exceeding 
the conforming loan limits determining eligibility for purchase by 
Freddie Mac or Fannie Mae, or multifamily properties.
    Quarterly HPI reports include a summary of recent developments, 
frequently asked questions and answers, and statistical reports for 
each geographic area. The most recent HPI report is included as Exhibit 
1 to this NPR.

Issues, Alternatives Considered, and Comments Received

1. Use of the HPI Versus the CQHPI and Other Alternatives
    OFHEO has concluded that the HPI is superior to the CQHPI for 
purposes of determining current values of single-family properties 
securing Enterprise loans. This conclusion is consistent with 
Congressional intent. During consideration of the 1992 Act, Congress 
recognized that the CQHPI might not be the most suitable index and 
provided OFHEO discretion to use another index.50 The legislative 
history also indicates Congress expected OFHEO to develop its own index 
for the stress test.51 The Senate report stated: ``As no existing 
data series is fully satisfactory for this purpose, the Director is 
encouraged to conduct research necessary to produce and publish a 
suitable index.'' 52
---------------------------------------------------------------------------

    \50\ Section 1361(d)(1) (12 U.S.C. 4611(d)(1)).
    \51\ Congress indicated that use by OFHEO would satisfy the 
requirement at section 1361(d)(1) of the 1992 Act (12 U.S.C. 
4611(d)(1)) that an appropriate index would ``be regularly used by 
the Federal Government.'' See 138 Cong. Rec. S 17920 (Chairman 
Riegle explaining that the index ``should be * * * used consistently 
by the Director or other Federal agencies * * *.'').
    \52\ S. Rep. No. 282, at 20.
---------------------------------------------------------------------------

    The CQHPI is based on data from the Housing Sales Survey conducted 
by the Bureau of the Census. Information on the physical 
characteristics and sales prices of new one-family houses are obtained 
through interviews with a national sample of the houses' builders and 
owners. The sample includes about 13,000 houses per year. The Commerce 
Department divides the data for detached houses into four regional 
samples. For each region, a statistical model is used to estimate how 
much the current average prices of new houses would have changed from 
the preceding period if the physical characteristics of new houses in 
both periods remained the same as they were in 1987. These regional 
estimates are published annually. The Commerce Department also 
publishes quarterly a national index that is a weighted average of the 
four regional indexes and a national index for attached houses.
    In the ANPR, OFHEO expressed the view that a weighted repeat 
transactions index based on Enterprise data was more appropriate for 
purposes of the risk-based capital test than the CQHPI.53 The HPI 
is such an index. By relying entirely upon Enterprise data, the HPI 
provides a more appropriate measure of average house price changes for 
the mix of properties securing the Enterprises' mortgages than does the 
CQHPI, which is based on a different mix of houses. A particularly 
important difference is that the HPI measures changes in values of 
existing houses, while the CQHPI measures price changes of new houses.
---------------------------------------------------------------------------

    \53\ 60 FR 7475 (Feb. 8, 1995).
---------------------------------------------------------------------------

    The CQHPI's small sample size results in other limitations that are 
undesirable for OFHEO's purposes. Because of limited data, the CQHPI 
provides national estimates by quarter, but only annual estimates for 
the four Census regions. Using either the quarterly, national estimates 
or the annual, regional estimates would present difficulties in 
accurately modeling the seasoning of Enterprise mortgages because house 
prices vary widely within Census regions and OFHEO must assess the 
Enterprises' capital on a quarterly basis. Such difficulties are 
avoided through the use of the HPI. With an existing database of more 
than

[[Page 29617]]

6.9 million transaction pairs, the weighted repeat sales approach 
provides sufficient data to estimate quarterly house price changes by 
states and by Census divisions.
    The implications of these and other statistical issues of house 
price index construction are reviewed in more detail in the HPI 
Technical Description.
    The Enterprises currently publish jointly the Conforming Mortgage 
House Price Index (CMHPI), a weighted repeat transactions index, using 
the same data as the HPI and a very similar methodology. OFHEO decided 
to produce its own index, rather than rely on the Enterprises' index, 
because of the important role of the house price index in determining 
capital requirements. By producing the HPI, OFHEO ensures that the 
index will meet the statutory requirements of quality, authority, and 
public availability. Additionally, OFHEO believes its index uses a 
statistical methodology that is more appropriate for its purposes (see 
issue 4. ``Statistical Methodology'' below).
    OFHEO also considered other existing house price indexes. NAR has 
published indexes for existing single-family houses for metropolitan 
areas since 1968, using data on transactions reported by member boards. 
The NAR indexes represent the change in the median transaction price 
with no adjustment for variations in the composition of the properties 
that make up the sample in each period. The National Association of 
Home Builders reports mean and median prices for both existing and new 
houses derived from county records. FHA issues a median value index for 
single-family houses financed under the Section 203(b) program.54 
This index is available as a time series back to 1936 and is based on 
appraisal values.
---------------------------------------------------------------------------

    \54\ 12 U.S.C. 1709(b).
---------------------------------------------------------------------------

    For OFHEO's purposes, these mean and median house price indexes are 
subject to a number of statistical shortcomings. In particular, changes 
in the composition of the sample of properties with a given set of 
attributes, such as square footage, number of rooms, lot size, 
fixtures, etc., contributing to these indexes causes them to be less 
reliable than the HPI as indicators of changes in the actual mean or 
median property value over time. A constant quality index, such as the 
HPI, which controls for this particular source of bias by comparing the 
same or similar properties, is a better source of information 
concerning the rate of house price inflation than these other indexes.
    All of the commenters who addressed this issue favored using a 
weighted repeat transactions index, such as the HPI, rather than the 
CQHPI. ACB, for example, stated that ``[t]he weighted repeat sales 
approach currently used by the [Enterprises] as a house price index is 
clearly preferable to other approaches since its purpose is . . . 
targeted to the population of properties where the [Enterprises] can 
assume risk.''
2. Geographic Aggregation
    OFHEO sought comment in the ANPR concerning the appropriate level 
of geographic aggregation for the index that will be used to adjust 
house prices in the risk-based capital stress test. The HPI is 
published for 9 Census divisions, 50 states, and the District of 
Columbia. A second NPR will address the level or levels of geographic 
aggregation that will be used in the stress test.
3. Bias and Volatility in the HPI
    OFHEO sought comment in the ANPR about whether to adjust for sample 
selection bias, appraisal bias, or other possible sources of bias in a 
weighted repeat transactions index of house prices. After considering 
comments on the matter, the Director decided not to adjust the HPI for 
such possible biases. Likewise, OFHEO requested comments about whether 
revision volatility in house price indexes should be reflected in the 
risk-based capital test.55 The Director also determined not to 
adjust the indexes for revision volatility. However, OFHEO is studying 
both the appropriateness and the practicality of adjusting for biases 
and revision volatility in the stress test, and will address these 
issues in a second NPR.
---------------------------------------------------------------------------

    \55\ Revision volatility is the change in past index values that 
occurs as a result of current transactions. Current transactions can 
change index values for prior quarters, because every repeat sale of 
a property provides additional information about house price changes 
during the time since the prior transaction on that property.
---------------------------------------------------------------------------

4. Statistical Methodology
    The HPI is based upon a geometric repeat transactions estimator 
derived from a stochastic model of individual housing values. A 
geometric repeat transaction estimator estimates the average rate of 
change in housing values, with each house weighted equally regardless 
of dollar value. The Enterprises use an adjustment to the geometric 
estimator to approximate an arithmetic repeat sales procedure in 
calculating the CMHPI.56 Arithmetic repeat transactions indexes 
have been shown to be more accurate for computing the change in the sum 
of the values of a fixed portfolio of properties. Because OFHEO plans 
to apply the index to loan-level data to update the distribution of 
current LTV ratios, OFHEO believes a geometric estimator is more 
suitable for use in the stress test. The publication of the HPI 
includes both the geometric index estimates and the adjustment factors 
needed to approximate an arithmetic index. Thus, the HPI publication 
provides the information needed to relate changes in the index to 
changes in the values of individual properties or portfolios of 
properties.57
---------------------------------------------------------------------------

    \56\ See HPI Technical Description, at 10-11 (discussion of 
ideal indexes, geometric versus arithmetic repeat sales estimators, 
and the Enterprises' approach in the CMHPI).
    \57\ Also, the adjustment used to produce the CMHPI depends on 
the base period of the index and the time elapsed since that period. 
Reporting the adjustment factors separately preserves the ability to 
adjust between any two dates covered by the index.
---------------------------------------------------------------------------

Section by Section Analysis

    As noted in the preamble, at a later date OFHEO will issue a second 
NPR to propose all the remaining aspects of the stress test and to 
describe how the stress test will be used to determine the Enterprises' 
risk-based capital requirements.

Proposed Section 1750.5 Notice of Capital Classification

    This section will be amended to add to the notice of capital 
classification, which OFHEO issues at least quarterly for each 
Enterprise, the risk-based capital level and the summary computation of 
that level.

Proposed Section 1750.10 General

    This section identifies a ``Subpart B'' to the capital regulation, 
which establishes risk-based capital requirements for each Enterprise. 
This section also requires the board of directors of an Enterprise to 
ensure that the Enterprise maintains total capital at a level that is 
sufficient to ensure the continued financial viability of the 
Enterprise and is equal to or greater than the risk-based capital level 
specified in the regulation.

Proposed Section 1750.11 Definitions

    This section defines various terms used in Subpart B and provides 
that, except where a term is explicitly defined differently in Subpart 
B, all terms defined at Sec. 1750.2 of Subpart A (the minimum capital 
regulation) shall have the same meanings for purposes of Subpart B.

[[Page 29618]]

Proposed Section 1750.12 Procedures and Timing

    This section will specify the timing and procedures for filing and 
the content of risk-based capital reports by each Enterprise. These 
reports will provide OFHEO with the information necessary to determine 
the risk-based capital level of each Enterprise. The section also 
requires that whenever an Enterprise makes an adjustment to the data 
contained in the risk-based capital report that may cause an adjustment 
to the risk-based capital determination, the Enterprise shall file with 
the Director an amended risk-based capital report not later than 3 
business days after the date of such adjustment. Finally, the section 
requires that each risk-based capital report or amended risk-based 
capital report contain a declaration by an officer, authorized by the 
board of directors to do so, that the report is true and correct to the 
best of such officer's knowledge and belief.

Proposed Section 1750.13 Risk-Based Capital Level Computation

    This section implements by regulation the provisions of the 1992 
Act that describe risk-based capital. Together with Appendix A to 
Subpart B of the regulation, proposed section 1750.13 describes how 
OFHEO calculates the risk-based capital requirement for an Enterprise.
    This section of the regulation implements the requirements of the 
1992 Act that requires OFHEO to create a stress test that relates 
losses of each Enterprise during the stress period to the historical 
benchmark loss experience in which losses on mortgages were the 
highest.58 The methodology that OFHEO uses to determine the 
benchmark area and period are referred to in proposed section 1750.13, 
and explained in greater detail in proposed Appendix A to Subpart B.
---------------------------------------------------------------------------

    \58\ Section 1361(a) (12 U.S.C. 4611(a)).
---------------------------------------------------------------------------

    The 1992 Act also describes aspects of the interest rate 
environment that OFHEO must apply during the stress period and makes 
frequent use of the term ``the preceding [period].'' Proposed section 
1750.13 implements that requirement and provides that when referring to 
a ``preceding'' period, the reference is to the period immediately 
preceding the beginning of the stress period.
    In constructing the stress test, OFHEO initially must assume that 
new business of the Enterprises will be limited to fulfilling 
contractual commitments of each Enterprise to purchase mortgages or 
issue securities.59 Proposed section 1750.13(a)(3) implements this 
requirement of the 1992 Act. The 1992 Act limits new business as 
described above until completion of two studies, one by the Director of 
the Congressional Budget Office and the other by the Comptroller 
General of the United States, on the advisability and appropriate form 
of any new business assumptions. The 1992 Act requires these studies to 
be completed within 1 year after issuance of the final risk-based 
capital regulation. The 1992 Act further provides that any new business 
assumptions incorporated by OFHEO into the stress test shall not become 
effective until 4 years after issuance of the final risk-based capital 
regulation.
---------------------------------------------------------------------------

    \59\ 1992 Act, section 1361(a)(3) (12 U.S.C. 4611(a)(3)).
---------------------------------------------------------------------------

    The 1992 Act also requires that the stress test incorporate losses 
or gains on activities, other than those specifically identified in the 
statute, in an amount and manner to be determined by the Director to be 
consistent with the stress period.60
---------------------------------------------------------------------------

    \60\ Section 1361(a)(4) (12 U.S.C. 4611(a)(4)).
---------------------------------------------------------------------------

    The risk-based capital test must take into account other 
considerations, including distinctions among the types of mortgage 
products, differences in seasoning, and any other factors the Director 
considers appropriate.61 Proposed paragraph 1750.13(a)(1) 
implements this provision of the 1992 Act and specifies that the 
detailed description of these factors and the methodology by which they 
shall be taken into account are included in Appendix A to Subpart B of 
the regulation.
---------------------------------------------------------------------------

    \61\ 1992 Act, section 1361(b)(1) (12 U.S.C. 4611(b)(1)).
---------------------------------------------------------------------------

    Proposed paragraph 1750.13(a)(5) also implements the requirement of 
the 1992 Act that characteristics of the stress period, other than 
those specifically set forth in that Act, will be determined by the 
Director to be most consistent with the stress period.62 The 
subsection also indicates that the details of these characteristics are 
provided in Appendix A to Subpart B of the regulation.
---------------------------------------------------------------------------

    \62\ Section 1361(b)(2) (12 U.S.C. 4611(b)(2)).
---------------------------------------------------------------------------

    Proposed subsection 1750.13(b) implements the 1992 Act's 
requirement that the total risk-based capital requirement include an 
additional amount equal to 30 percent of the capital determined by 
applying the risk-based capital test.63
---------------------------------------------------------------------------

    \63\ Id.
---------------------------------------------------------------------------

Proposed Appendix A: Risk-Based Capital Test Methodology and 
Assumptions

    Appendix A to Subpart B of the capital regulation will provide a 
detailed description of the stress test. In this NPR, OFHEO proposes 
the part of Appendix A that defines the methodology OFHEO uses to 
identify the benchmark loss experience. The other aspects of the stress 
test by which OFHEO will relate Enterprise losses in the stress period 
to the benchmark loss experience will be the subject of a second NPR.
    Appendix A also includes a proposal to use the House Price Index 
(HPI), published by OFHEO, to calculate the change over time in the 
value of houses that secure mortgages purchased by the Enterprises. The 
1992 Act requires OFHEO to calculate this change in value in accordance 
with the CQHPI, published by the Secretary of Commerce, or any index of 
similar quality, authority, and public availability that is regularly 
used by the Federal Government.64 Under proposed Appendix A, OFHEO 
uses the HPI, which is a weighted repeat transactions index based on 
Enterprise data, rather than the CQHPI, as the basic measure of changes 
in the value of house prices.
---------------------------------------------------------------------------

    \64\ Sections 1361(b)(1), 1361(d)(1) (12 U.S.C. 4611(b)(1), 
4611(d)(1)).
---------------------------------------------------------------------------

Regulatory Impact

Executive Order 12606, The Family

    This proposed regulation does not have potential for significant 
impact on family formulation, maintenance, and general well-being, and 
thus is not subject to review under Executive Order 12606.

Executive Order 12612, Federalism

    This proposed regulation has no federalism implications that 
warrant the preparation of a Federalism Assessment in accordance with 
Executive Order 12612.

Executive Order 12866, Regulatory Planning and Review

    This proposed regulation has been reviewed by the Office of 
Management and Budget pursuant to Executive Order 12866.

Executive Order 12988, Civil Justice Reform

    This proposed regulation meets the applicable standards of sections 
3(a) and (b) of Executive Order 12988.

Unfunded Mandates Reform Act of 1995

    This proposed regulation does not include a federal mandate that 
may

[[Page 29619]]

result in the expenditure by State, local, and tribal governments, in 
the aggregate, or by the private sector, of $100,000,000 or more 
(adjusted annually for inflation) in any one year.
    Consequently, the proposed regulation does not warrant the 
preparation of an assessment statement in accordance with the Unfunded 
Mandates Reform Act of 1995.

Regulatory Flexibility Act

    This proposed regulation is applicable only to the Enterprises, 
which are not small entities for purposes of the Regulatory Flexibility 
Act, and does not have a significant effect on a substantial number of 
small entities. Therefore, the General Counsel of OFHEO has certified 
that the proposed regulation would not have significant economic impact 
on a substantial number of small entities.

Paperwork Reduction Act

    This proposed regulation contains no information collection 
requirements that require the approval of the Office of Management and 
Budget pursuant to the Paperwork Reduction Act of 1980, 44 U.S.C. 3501 
et seq.

List of Subjects in 12 CFR Part 1750

    Risk-based capital, capital classifications.

    Accordingly, for the reasons set forth in the preamble, OFHEO 
proposes to amend Part 1750 of Chapter XVII of Title 12 of the Code of 
Federal Regulations, as proposed at 60 FR 30201 (June 8, 1995), as 
follows:

PART 1750--[AMENDED]

    1. The Authority section for Part 1750 is revised to read as 
follows:

    Authority: 12 U.S.C. 4513, 4514, 4611, 4612, 4614, 4618.

    2. Section 1750.5 of Subpart A is amended by deleting the ``and'' 
at the end of paragraph (b)(1)(ii) and by deleting the period at the 
end of paragraph (b)(1)(iii) and inserting a semicolon in lieu of the 
period. The section is further amended by adding the following 
paragraphs after paragraph (b)(1)(iii):

Sec. 1750.5   Notice of Capital Classification

* * * * *
    (b)(1) * * *
    (iv) the proposed risk-based capital level; and
    (v) the summary computation of the proposed risk-based capital 
level.
* * * * *
    3. Subpart B is added to read as follows:

Subpart B--Risk-Based Capital

Sec.
1750.10  General.
1750.11  Definitions.
1750.12  Procedures and Timing.
1750.13  Risk-Based Capital Level Computation.

Appendix A to Subpart B of Part 1750--Risk-Based Capital Test 
Methodology and Assumptions

Subpart B--Risk-Based Capital

Sec. 1750.10  General.

    The regulation contained in this Subpart B establishes the risk-
based capital requirement for each Enterprise. The board of directors 
of an Enterprise is responsible for ensuring that the Enterprise 
maintains total capital at a level that is sufficient to ensure the 
continued financial viability of the Enterprise and is equal to or 
exceeds the risk-based capital level contained in this Subpart B.

Sec. 1750.11  Definitions.

    Except where a term is explicitly defined differently in Subpart B, 
all terms defined at Sec. 1750.2 of Subpart A shall have the same 
meanings for purposes of Subpart B. For purposes of Subpart B, the 
following definitions shall apply:
    Benchmark loss experience means the default and severity behavior 
of mortgage loans that:
    (1) Were originated during a period of 2 or more consecutive 
calendar years in contiguous areas that together contain at least 5 
percent of the population of the United States, and
    (2) Experienced the highest loss rate for any period of such 
duration in comparison with the loans originated in any other 
contiguous areas that together contain at least 5 percent of the 
population of the United States.
    Constant maturity Treasury yield means the constant maturity 
Treasury yield, published by the Board of Governors of the Federal 
Reserve System.
    Contiguous areas means all the areas within a state or a group of 
two or more states sharing common borders. ``Sharing common borders'' 
does not mean meeting at a single point. Colorado, for example, is 
contiguous with New Mexico, but not with Arizona.
    Credit risk means the risk of financial loss to an Enterprise from 
nonperformance by borrowers or other obligors on instruments in which 
an Enterprise has a financial interest, or as to which the Enterprise 
has a financial obligation.
    The default rate of a given group of loans means the ratio of the 
aggregate original principal balance of the defaulted loans in the 
group to the aggregate original principal balance of all loans in the 
group.
    Defaulted loan means a loan that, within 10 years following its 
origination:
    (1) Resulted in pre-foreclosure sale,
    (2) Completed foreclosure,
    (3) Resulted in REO, or
    (4) Resulted in a credit loss to an Enterprise.
    Financing costs of property acquired through foreclosure means the 
product of:
    (1) The number of years (including fractions) of the period from 
the completion of foreclosure through disposition of the property,
    (2) The average of the Enterprises' short-term funding costs, and
    (3) The unpaid principal balance at the time of foreclosure.
    Interest rate risk means the risk of financial loss due to the 
sensitivity of earnings and net worth of an Enterprise to changes in 
interest rates.
    Loss on any defaulted loan in category 1, 2, or 3 of the definition 
of defaulted loan means the difference between:
    (1) The sum of the principal and interest owed when the borrower 
lost title to the property securing the mortgage; REO financing costs 
1 through the date of property disposition; and cash expenses 
incurred during the foreclosure process, REO holding period, and 
property liquidation process; and
---------------------------------------------------------------------------

    \1\ The financing costs associated with properties acquired 
through foreclosure from the time of foreclosure through property 
disposition were calculated using the average from 1982 through 1992 
of the 12-month Federal Agency constant maturity yield computed by 
Bank of America.
---------------------------------------------------------------------------

    (2) The sum of the property sales price and any other liquidation 
proceeds (except those resulting from private mortgage insurance 
proceeds or other third-party credit enhancements).

Losses on defaulted loans not in categories 1, 2, or 3 of the 
definition were defined as the amount of the financial loss to the 
Enterprise.
    Mortgage means any loan secured by such classes of liens as are 
commonly given or are legally effective to secure advances on, or the 
unpaid purchase price of, real estate under the laws of the State in 
which the real estate is located, or a manufactured house that is 
personal property under the laws of the State in which the manufactured 
house is located, together with the credit instruments, if any, secured 
thereby, and includes interests in mortgages.
    Seasoning means the change over time in the ratio of the unpaid 
principal balance of a mortgage to the value of the

[[Page 29620]]

property by which such mortgage loan is secured.
    Severity rate for any group of defaulted loans means the aggregate 
losses on all loans in that group divided by the aggregate original 
principal balances of those loans.
    Stress period means a hypothetical 10-year period immediately 
following the day for which capital is being measured, which is a 
period marked by severely adverse economic circumstances.
    Total capital means, with respect to an Enterprise, the sum of the 
following:
    (1) The core capital of the Enterprise;
    (2) A general allowance for foreclosure losses, which--
    (i) shall include an allowance for portfolio mortgage losses, an 
allowance for non-reimbursable foreclosure costs on government claims, 
and an allowance for liabilities reflected on the balance sheet for the 
Enterprise for estimated foreclosure losses on mortgage-backed 
securities; and
    (ii) shall not include any reserves of the Enterprise made or held 
against specific assets.
    (3) Any other amounts from sources of funds available to absorb 
losses incurred by the Enterprise, that the Director by regulation 
determines are appropriate to include in determining total capital.
    Type of mortgage product means a classification of one or more 
mortgage products, as established by the Director, that have similar 
characteristics from each set of characteristics under the following 
paragraphs:
    (1) The property securing the mortgage is--
    (i) a residential property consisting of 1 to 4 dwelling units; or
    (ii) a residential property consisting of more than 4 dwelling 
units.
    (2) The interest rate on the mortgage is--
    (i) fixed; or
    (ii) adjustable.
    (3) The priority of the lien securing the mortgage is--
    (i) first; or
    (ii) second or other.
    (4) The term of the mortgage is--
    (i) 1 to 15 years;
    (ii) 16-30 years; or
    (iii) more than 30 years.
    (5) The owner of the property is--
    (i) an owner-occupant; or
    (ii) an investor.
    (6) The unpaid principal balance of the mortgage--
    (i) will amortize completely over the term of the mortgage, and 
will not increase significantly at any time during the term of the 
mortgage;
    (ii) will not amortize completely over the term of the mortgage, 
and will not increase significantly at any time during the term of the 
mortgage; or
    (iii) may increase significantly at some time during the term of 
the mortgage.
    (7) Any other characteristics of the mortgage, as specified in 
Appendix A.

Sec. 1750.12  Procedures and Timing.

    (a) Each Enterprise shall file with the Director a risk-based 
capital report each quarter, or at such other times as the Director 
requires. The report shall contain information identified by OFHEO in 
written instructions to each Enterprise, including, but not limited to:
    (1) all data required to implement the risk-based capital test, as 
specified more fully at Appendix A to Subpart B of Part 1750; and
    (2) such other information as may be required by the Director.
    (b) The quarterly risk-based capital report for the last day of the 
preceding quarter shall be submitted not later than April 30, July 30, 
October 30, and January 30 of each year.
    (c) Each risk-based capital report shall be submitted in such 
format or media as may be required by the Director.
    (d) If an Enterprise makes an adjustment to the data contained in 
the risk-based capital report for a quarter or a date for which the 
report was previously supplied that may cause an adjustment to the 
risk-based capital determination, the Enterprise shall file with the 
Director an amended risk-based capital report not later than 3 business 
days after the date of such adjustment.
    (e) Each risk-based capital report or any amended risk-based 
capital report shall contain a declaration by the president, vice-
president, treasurer, or any other officer designated by the board of 
directors of the Enterprise to make such a declaration that the report 
is true and correct to the best of such officer's knowledge and belief.

Sec. 1750.13  Risk-Based Capital Level Computation.

    (a) Risk-Based Capital Test--OFHEO shall compute a risk-based 
capital level for each Enterprise at least quarterly by applying a 
risk-based capital test to determine the amount of total capital 
required for each Enterprise to maintain positive capital during the 
stress period. In making this determination, the Director shall take 
into account any appropriate distinctions among types of mortgage 
products, differences in seasoning of mortgages, and other factors 
determined appropriate by the Director in accordance with the 
methodology specified in Appendix A to this subpart. The stress period 
has the following characteristics:
    (1) Credit risk--With respect to mortgages owned or guaranteed by 
the Enterprise and other obligations of the Enterprise, losses occur 
throughout the United States at a rate of default and severity 
reasonably related, in accordance with Appendix A to this subpart, to 
the rate and severity of losses in the benchmark loss experience.
    (2) Interest rate risk--
    (i) In general--Interest rates decrease as described in paragraph 
(a)(2)(ii) of this section or increase as described in paragraph 
(a)(2)(iii) of this section, whichever would require more capital in 
the stress test for the Enterprise. Appendix A contains a description 
of the methodology applied to implement the interest rate scenarios 
described in those subparagraphs.
    (ii) Decreases--The 10-year constant maturity Treasury yield 
decreases during the first year of the stress period and remains at the 
new level for the remainder of the stress period. The yield decreases 
to the lesser of--
    (A) 600 basis points below the average yield during the 9 months 
immediately preceding the stress period, or
    (B) 60 percent of the average yield during the 3 years immediately 
preceding the stress period,

but in no case to a yield less than 50 percent of the average yield 
during the 9 months immediately preceding the stress period.
    (iii) Increases--The 10-year constant maturity Treasury yield 
increases during the first year of the stress period and will remain at 
the new level for the remainder of the stress period. The yield 
increases to the greater of--
    (A) 600 basis points above the average yield during the 9 months 
immediately preceding the stress period, or
    (B) 160 percent of the average yield during the 3 years immediately 
preceding the stress period,

but in no case to a yield greater than 175 percent of the average yield 
during the 9 months immediately preceding the stress period.
    (iv) Different terms to maturity--Yields of Treasury instruments 
with terms to maturity other than 10 years will change relative to the 
10-year constant maturity Treasury yield in patterns and for durations 
that are reasonably related to historical experience and are judged 
reasonable by the Director. The methodology used by the Director to 
adjust the yields of those other instruments is specified in Appendix A 
to this subpart.
    (v) Large increases in yields--If the 10-year constant maturity 
Treasury yield is assumed to increase by more than 50 percent over the 
average yield

[[Page 29621]]

during the 9 months immediately preceding the stress period, the 
Director shall adjust the losses resulting from the conditions 
specified in paragraphs (a)(2) (i) and (ii) of this section to reflect 
a correspondingly higher rate of general price inflation. The method of 
such adjustment by the Director is specified in Appendix A to this 
subpart.
    (3) New business--Any contractual commitments of the Enterprise to 
purchase mortgages or issue securities will be fulfilled. The 
characteristics of resulting mortgages purchased, securities issued, 
and other financing will be consistent with the contractual terms of 
such commitments, recent experience, and the economic characteristics 
of the stress period, as more fully specified in Appendix A to this 
subpart. No other purchases of mortgages shall be assumed.
    (4 ) Other activities--Losses or gains on other activities, 
including interest rate and foreign exchange hedging activities, shall 
be determined by the Director, in accordance with Appendix A to this 
subpart and on the basis of available information, to be consistent 
with the stress period.
    (5) Consistency--Characteristics of the stress period other than 
those specifically set forth in this paragraph (a), such as prepayment 
experience and dividend policies, will be determined by the Director, 
in accordance with Appendix A, on the basis of available information, 
to be most consistent with the stress period.
    (b) Risk-Based Capital Level--The risk-based capital level of an 
Enterprise, to be used in determining the appropriate capital 
classification of each Enterprise, as required by section 1364 of the 
Federal Housing Enterprises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4614), shall be equal to the sum of the following amounts:
    (1) Credit and Interest Rate Risk--The amount of total capital 
determined by applying the risk-based capital test under paragrpah (a) 
of this section to the Enterprise.
    (2) Management and Operations Risk--To provide for management and 
operations risk, 30 percent of the amount of total capital determined 
by applying the risk-based capital test under paragraph (a) of this 
section to the Enterprise.

Appendix A to Subpart B of Part 1750--Risk-Based Capital Test 
Methodology and Assumptions

    1. Identifying the Benchmark Loss Experience.--OFHEO will use 
the definitions, data, and methodology described below to identify 
the benchmark loss experience.
    A. Definitions.--In addition to the terms defined at section 
1750.11, the following definition shall apply for this Appendix A:
    Origination year means the year in which a loan is originated.
    B. Data.
    OFHEO identifies the benchmark loss experience using historical 
loan-level data required to be submitted by each of the two 
Enterprises. OFHEO's analysis is based entirely on the most current 
data available on conventional, 30-year, fixed-rate loans secured by 
first liens on single-unit, owner-occupied, detached properties. 
Detached properties are defined as single-family properties 
excluding condominiums, planned urban developments, and 
cooperatives. The data includes only loans that were purchased by an 
Enterprise within 12 months after loan origination and loans for 
which the Enterprise has no recourse to the lender.
    OFHEO organizes the data from each Enterprise to create two 
substantially consistent data sets. OFHEO separately analyzes 
default and severity data from each Enterprise. Default rates are 
calculated from loan records meeting the criteria specified above. 
Severity rates are calculated from the subset of defaulted loans for 
which loss data are available.
    C. Procedures.
    i. Cumulative 10-year default rates for each combination of 
states and origination years (state/year combination) that OFHEO 
examines are calculated for each Enterprise by grouping all of the 
Enterprise's loans originated in that combination of states and 
years. For origination years with less than 10 years of loss 
experience, cumulative-to-date default rates are used. The two 
Enterprise default rates are averaged, yielding an ``average default 
rate'' for that state/year combination.
    ii. An ``average severity rate'' for each state/year combination 
is determined in the same manner as the average default rate. For 
each Enterprise, the aggregate severity rate is calculated for all 
loans in the relevant state/year combination and the two Enterprise 
severity rates are averaged.
    iii. The ``loss rate'' for any state/year combination examined 
is calculated by multiplying the average default rate for that 
state/year combination by the average severity rate for that 
combination.
    iv. The default and severity behavior of loans in the state/year 
combination containing at least 2 consecutive origination years and 
contiguous areas with a total population equal to or greater than 5% 
of the population of the United States with the highest loss rate 
constitutes the benchmark loss experience.
    2. Identification of a New Benchmark Loss Experience.--OFHEO 
will periodically monitor available data and reevaluate the 
benchmark loss experience using the methodology set forth in this 
Appendix A. Using this methodology, OFHEO may identify a new 
benchmark loss experience that has a higher rate of loss than the 
benchmark experience identified at the time of the issuance of this 
regulation. In the event such a benchmark is identified, OFHEO may 
incorporate the resulting higher loss rates in the stress test.
    3. Contents of the Risk-Based Capital Report.--(This space 
deliberately left blank.)
    4. Computation of Risk-Based Capital Level.--(This space 
deliberately left blank.)
    A. Seasoning Methodology.--OFHEO will determine the rate of 
change over time in the values of single-family properties securing 
mortgages using the House Price Index published by OFHEO or any 
successor index. (The remainder of this paragraph deliberately left 
blank.)
Aida Alvarez,
Director, Office of Federal Housing Enterprise Oversight.
[FR Doc. 96-14496 Filed 6-10-96; 8:45 am]
BILLING CODE 4220-01-P

Complete official Federal Register PDF

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FR Doc. 96-14496 Office of Federal Housing Enterprise Oversight; Risk-Based Capital

FR Doc. 96-14496 Office of Federal Housing Enterprise Oversight; Risk-Based Capital

FR Doc. 96-14496 Office of Federal Housing Enterprise Oversight; Risk-Based Capital

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