89 FR 211 pgs. 86723-86739 - TWIC—Reader Requirements; Second Delay of Effective Date
Type: RULEVolume: 89Number: 211Pages: 86723 - 86739
Pages: 86723, 86724, 86725, 86726, 86727, 86728, 86729, 86730, 86731, 86732, 86733, 86734, 86735, 86736, 86737, 86738, 86739Docket number: [Docket No. USCG-2022-0052]
FR document: [FR Doc. 2024-24780 Filed 10-30-24; 8:45 am]
Agency: Homeland Security Department
Sub Agency: Coast Guard
Official PDF Version: PDF Version
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DEPARTMENT OF HOMELAND SECURITY
Coast Guard
33 CFR Part 105
[Docket No. USCG-2022-0052]
RIN 1625-AC80
TWIC-Reader Requirements; Second Delay of Effective Date
AGENCY:
Coast Guard, DHS.
ACTION:
Final rule.
SUMMARY:
[top] The Coast Guard is further delaying the effective date for certain facilities affected by the final rule entitled "Transportation Worker Identification Credential (TWIC)-Reader Requirements," published in the
DATES:
This final rule is effective December 2, 2024.
ADDRESSES:
To view documents mentioned in this preamble as being available in the docket, go to www.regulations.gov, type USCG-2022-0052 in the search box and click "Search." Next, in the Document Type column, select "Supporting & Related Material."
FOR FURTHER INFORMATION CONTACT:
For information about this document, or for technical inquiries, call or email Lieutenant Commander Jeffrey Bender, U.S. Coast Guard; telephone 202-372-1114, email Jeffrey.M.Bender@uscg.mil. For general information and press inquiries, contact Chief Warrant Officer Brittany Panetta, U.S. Coast Guard; telephone 202-372-4449 email Brittany.P.Panetta@uscg.mil.
SUPPLEMENTARY INFORMATION:
Table of Contents for Preamble
I. Abbreviations
II. Basis, Purpose, and Regulatory History
III. Background
IV. Discussion of Comments
V. Discussion of the Rule To Delay the Effective Date
VI. Regulatory Analyses
A. Regulatory Planning and Review
B. Small Entities
C. Assistance for Small Entities
D. Collection of Information
E. Federalism
F. Unfunded Mandates
G. Taking of Private Property
H. Civil Justice Reform
I. Protection of Children
J. Indian Tribal Governments
K. Energy Effects
L. Technical Standards
M. Environment
I. Abbreviations
2006 NPRM "Transportation Worker Identification Credential (TWIC) Implementation in the Maritime Sector; Hazardous Materials Endorsement for a Commercial Driver's License" notice of proposed rulemaking published May 22, 2006
2007 final rule "Transportation Worker Identification Credential (TWIC) Implementation in the Maritime Sector; Hazardous Materials Endorsement for a Commercial Driver's License" final rule published January 25, 2007
2016 TWIC Reader final rule "Transportation Worker Identification Credential (TWIC)-Reader Requirements" final rule published August 23, 2016
2020 TWIC Reader Delay final rule "TWIC-Reader Requirements; Delay of Effective Date" final rule published March 9, 2020
2022 Second Reader Delay NPRM "Transportation Worker Identification Credential (TWIC)-Reader Requirements; Second Delay of Effective Date" notice of proposed rulemaking, published Dec. 6, 2022
2023 Authorization Act James M. Inhofe National Defense Authorization Act for Fiscal Year 2023
2023 Conforming Amendment "Transportation Worker Identification Credential-Facility Reader Requirement; Conforming Amendment" final rule, conforming amendments published April 17, 2023
2023 TWIC Reader Delay rule "TWIC-Reader Requirements; Second Delay of Effective Date" final rule published October 31, 2024.
ANPRM Advance notice of proposed rulemaking
BEA U.S. Bureau of Economic Analysis
BLS Bureau of Labor Statistics
CAP Corrective Action Plan
CDC Certain dangerous cargoes
CFR Code of Federal Regulations
DHS Department of Homeland Security
FR Federal Register
GDP Gross Domestic Product
HSOAC Homeland Security Operational Analysis Center
MSRAM Maritime Security Risk Analysis Model
MTSA Maritime Transportation Security Act of 2002
NIPA National Income and Product Accounts
NPRM Notice of proposed rulemaking
OMB Office of Management and Budget
PIN Personal identification number
Pre-CA Pre-Conforming Amendment
RA Regulatory Analysis
SAFE Port Act Security and Accountability for Every Port Act of 2006
§ Section
TSA Transportation Security Administration
TSI Transportation security incident
TWIC Transportation Worker Identification Credential
U.S.C. United States Code
II. Basis, Purpose, and Regulatory History
Pursuant to the Maritime Transportation Security Act of 2002 (MTSA), 1 and in accordance with the Security and Accountability for Every Port Act of 2006 (SAFE Port Act), 2 the electronic inspection of Transportation Worker Identification Credentials (TWICs) is required inside secure areas on certain vessels and facilities in the United States. Specifically, the SAFE Port Act requires that the Secretary put into effect regulations that require the deployment of electronic transportation security card readers. 3 To implement this requirement in an effective manner, the Coast Guard initiated a series of regulatory actions, updating its facility and vessel plan requirements based on 46 U.S.C. 70103, to implement electronic TWIC inspections at certain high-risk vessels and facilities regulated under MTSA. 4
Footnotes:
1 ?See Sec. 102 of Public Law 107-295 (November 25, 2002), codified as 46 United States Code (U.S.C.) 70105.
2 ?See Sec. 104 of Public Law 109-347 (October 13, 2006).
3 ?See 46 U.S.C. 70105(k)(3).
4 ?See Sec. 102 of Public Law 107-295 (November 25, 2002) (Maritime transportation security plans).
On May 22, 2006, the Coast Guard and the Transportation Security Administration (TSA) jointly published a notice of proposed rulemaking (NPRM) titled "Transportation Worker Identification Credential (TWIC) Implementation in the Maritime Sector; Hazardous Materials Endorsement for a Commercial Driver's License" ("2006 NPRM"). 5 After considering comments on the 2006 NPRM, the Coast Guard and TSA published the final rule on January 25, 2007, also titled "Transportation Worker Identification Credential (TWIC) Implementation in the Maritime Sector; Hazardous Materials Endorsement for a Commercial Driver's License" ("2007 final rule"). 6 The 2007 final rule mandated that all persons allowed unescorted access to secure areas in MTSA-regulated vessels and facilities were required to possess a TWIC card. The rule did not mandate that a TWIC card be read with an electronic reader. The card could be verified by visual inspection alone, without making use of the electronic security features built into the card.
Footnotes:
5 ?71 FR 29395.
6 ?72 FR 3491.
Although the 2006 NPRM proposed certain TWIC reader requirements, after reviewing the public comments, the Coast Guard and TSA decided not to include those proposed requirements in the 2007 final rule. Instead, we addressed them in a separate rulemaking, discussed below, and conducted a pilot program to address the feasibility of reader requirements before issuing another final rule. For a detailed discussion of the public comments to the 2006 NPRM, and our responses to them, please refer to the 2007 final rule.
[top] On March 27, 2009, the Coast Guard published an advance notice of proposed rulemaking (ANPRM) on the topic of TWIC reader requirements, "Transportation Worker Identification
Footnotes:
7 ?74 FR 13360.
On March 22, 2013, we published an NPRM, "Transportation Worker Identification Credential (TWIC)-Reader Requirements"? 8 that proposed the three risk groups (A, B, and C), but limited the proposed electronic TWIC inspection requirements to Risk Group A vessels and facilities only.
Footnotes:
8 ?78 FR 17782.
On August 23, 2016, we published a final rule titled "Transportation Worker Identification Credential (TWIC)-Reader Requirements"? 9 ("2016 TWIC Reader final rule") that eliminated the three risk group structure and required that high-risk vessels and facilities (still referred to as Risk Group A) conduct electronic TWIC inspections for all personnel seeking unescorted access to secure areas of the vessel or facility. Risk Group A vessels and facilities are defined in title 33 of the Code of Federal Regulations (CFR), §§?104.263, 105.253, and 106.258.
Footnotes:
9 ?81 FR 57652).
Congress also passed several laws that impacted implementation of the TWIC reader program. On December 16, 2016, the President signed the bill titled "Transportation Security Card Program Assessment."? 10 This law required the Secretary of the Department of Homeland Security (DHS) to commission a report reviewing the security value of the TWIC program by (1) evaluating the extent to which the TWIC program addresses known or likely security risks in the maritime and port environments; (2) evaluating the potential for a non-biometric credential alternative; (3) identifying the technology, business process, and operational impact of the TWIC card and readers in maritime and port environments; (4) assessing the costs and benefits of the TWIC program, as implemented; and (5) evaluating the extent to which DHS has addressed the deficiencies of the TWIC program previously identified by the Government Accountability Office and the DHS Office of the Inspector General.
Footnotes:
10 ?Public Law 114-278, 130 Stat. 1410.
On May 15, 2017, the Coast Guard received a petition for rulemaking requesting that it revise the 2016 TWIC Reader final rule and impose electronic TWIC inspection requirements on only those vessels and facilities that engage in the maritime transfer of certain dangerous cargoes (CDC). 11
Footnotes:
11 ?See docket number USCG-2017-0447, available at https://www.regulations.gov (last visited 04/28/2023).
On June 22, 2018, we published a second NPRM, "TWIC-Reader Requirements; Delay of Effective Date", 12 which proposed delaying the implementation of the 2016 TWIC Reader final rule until August 23, 2021, for two categories of facilities: (1) facilities that handle CDC in bulk, but do not transfer these cargoes from or to a vessel; and (2) facilities that receive vessels carrying CDC in bulk, but do not, during that vessel-to-facility interface, transfer these bulk cargoes from or to those vessels.
Footnotes:
12 ?83 FR 29067.
On August 2, 2018, the President signed the "Transportation Worker Identification Credential Accountability Act of 2018,"? 13 which prohibited the Coast Guard from implementing the 2016 TWIC Reader final rule until at least 60 days after the Coast Guard submits the report on the security value of the TWIC program to Congress, as required by the 2016 bill, "Transportation Security Card Program Assessment."? 14
Footnotes:
13 ?See section 2 of Public Law 115-230, 132 Stat. 1631.
14 ?Public Law 114-278, 130 Stat. 1410. The report was submitted in August 2019.
On March 9, 2020, the Coast Guard published a final rule titled "TWIC-Reader Requirements; Delay of Effective Date"? 15 ("2020 TWIC Reader Delay final rule"). The 2020 TWIC Reader Delay final rule extended the effective date of the 2016 TWIC Reader final rule, only for Risk Group A facilities that handle CDC in bulk, until May 8, 2023. 16 The implementation date for facilities designated as Risk Group A, because they receive vessels certificated to carry more than 1,000 passengers, remained unchanged. The 2016 TWIC Reader final rule was implemented on June 8, 2020. However, the Coast Guard delayed enforcing this regulation until January 1, 2022, because of the global COVID-19 pandemic.
Footnotes:
15 ?85 FR 13943.
16 ?While the NPRM proposed limiting the delay only to those facilities that handle CDC in bulk, but do not transfer it from or to a vessel, and facilities that receive vessels that carry bulk CDC but do not transfer bulk CDC from or to the vessel, after consideration of public comments, the 2020 TWIC Reader Delay final rule delayed implementation for all facilities that handle bulk CDC and facilities that receive vessels carrying CDC, including facilities that transfer bulk CDC from or to a vessel.
In 2020, the Coast Guard commissioned the Homeland Security Operational Analysis Center (HSOAC)-operated by the RAND Corporation-to conduct an analysis. The purpose of the analysis was to (1) identify the population of facilities handling CDC impacted by the 2016 TWIC Reader final rule; (2) develop a risk-consequence analysis for these facilities; and (3) conduct a benefit-cost analysis based on the information collected and analyzed during this subsequent study. The Coast Guard received the RAND Corporation's analysis on July 29, 2022, and is currently evaluating the options for implementing the 2016 TWIC Reader final rule. The 2022 RAND Corporation's analysis is included in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble.
While we evaluate the HSOAC analysis, the Coast Guard is continuing to delay the original rule's implementation with this final rule to avoid the 2016 TWIC Reader final rule going into effect. We are delaying that rule's implementation for three categories of facilities: (1) facilities that handle CDC in bulk but do not transfer those cargoes from or to a vessel; (2) facilities that handle CDC in bulk and do transfer those cargoes from or to a vessel; and (3) facilities that receive vessels carrying CDC in bulk, but do not, during that vessel-to-facility interface, transfer those bulk cargoes from or to those vessels-to May 8, 2029, to avoid creating confusion and conflicts between the 2016 TWIC Reader final rule's original requirements and the potential outcomes of the study. The 2016 TWIC Reader final rule remains in effect for facilities receiving vessels certificated to carry more than 1,000 passengers. This final rule does not affect those facilities.
[top] On December 23, 2022, Congress enacted the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 ("2023 Authorization Act"). 17 Section 11804 of the 2023 Authorization Act directs the Secretary of Homeland Security to not implement TWIC reader regulations for "covered facilities" before May 8, 2026. The 2023 Authorization Act identifies covered facilities as facilities that (1) handle CDC in bulk and transfer such cargoes from or to a vessel; (2) handle CDC in bulk but do not transfer it from or to a vessel; and (3) receive vessels carrying CDC in bulk but, during the vessel-to-facility interface, do not transfer it from or to the vessel. These three categories
Footnotes:
17 ?Public Law 117-263, 136 Stat. 2395.
Two weeks before the 2023 Authorization Act was enacted, the Coast Guard published an NPRM titled "Transportation Worker Identification Credential (TWIC)-Reader Requirements; Second Delay of Effective Date." ("2022 Second Reader Delay NPRM")? 18 In it, we proposed to change the implementation dates for the categories in §?105.253(a)(2) through (4) to May 8, 2026, and requested comments on whether we should extend the date as late as May 8, 2029.
Footnotes:
18 ?87 FR 74563 (Dec. 6, 2022).
On April 17, 2023, consistent with the 2023 Authorization Act, the Coast Guard published the "Transportation Worker Identification Credential-Facility Reader Requirement; Conforming Amendment" ("2023 Conforming Amendment"), which changed the implementation dates in 33 CFR 105.253(a)(2) through (4) from May 8, 2023, to May 8, 2026. 19 The 2023 Conforming Amendment aligned Coast Guard regulations with the Congressionally mandated minimum delay for implementation of TWIC readers for the covered facilities.
Footnotes:
19 ?88 FR 23349.
III. Background
The 2016 TWIC Reader final rule established electronic TWIC reader regulations for certain high-risk vessels and MTSA-regulated facilities. Shortly after the 2016 TWIC Reader final rule was published, the chemical industry expressed concern that the final rule significantly expanded the scope of the 2013 NPRM for that rulemaking? 20 and requested that the Coast Guard narrow the classes of chemical facilities that would be subject to the enhanced security requirements. An industry association representing terminal companies nationwide then sued DHS in 2017, claiming that the 2016 TWIC Reader final rule violated the Administrative Procedure Act. 21 The court dismissed the action, holding that the issue was not ripe for adjudication, because Congress passed legislation delaying the implementation of the final rule, and there was a likelihood that Congress or the Coast Guard might amend or replace the regulation. 22
Footnotes:
20 ?78 FR 17781.
21 ? Int'l Liquid Terminals Ass'n v. U.S. Dep't of Homeland Sec., No. 1:18-cv-00467, 2018 WL 8667001, at *1 (E.D. Va., Sept. 17, 2018).
22 ?Id. at *2.
In June 2020, DHS published the Coast Guard's corrective action plan (CAP) titled "Corrective Action Plan from the Assessment of the Risk Mitigation Value of the Transportation Worker Identification Credential."? 23 The CAP identified the need to conduct a risk analysis over the next 3 years to identify all facilities handling CDC and to analyze the need for TWIC readers.
Footnotes:
23 ?A copy of the study is available in the docket for this final rule. Corrective Action Plan from the Assessment of the Risk Mitigation Value of the Transportation Worker Identification Credential; Report to Congress, June 2020.
In September 2020, the Coast Guard commissioned the HSOAC, operated by the RAND Corporation, to conduct an analysis to identify the population of facilities handling CDC impacted by the 2016 TWIC Reader final rule, develop a risk-consequence analysis for these facilities, and conduct a benefit-cost analysis.
In response to the 2023 Authorization Act mandate discussed previously, the Coast Guard published the 2023 Conforming Amendment on April 17, 2023, which changed the implementation dates in 33 CFR 105.253(a)(2) through (4) from May 8, 2023, to May 8, 2026. 24
Footnotes:
24 ?88 FR 23349.
IV. Discussion of Comments
In response to the 2022 Second Reader Delay NPRM, which proposed a delay of 3, 4, 5, or 6 years, the Coast Guard received five public comments, two of which were duplicate submissions. 25 All commenters supported the Coast Guard's proposal to delay the implementation of the TWIC reader rule. Additionally, all commenters generally supported a delay of 6 years.
Footnotes:
25 ?87 FR 74563.
All comments the Coast Guard received mentioned the 2022 RAND Corporation's HSOAC analysis, titled "Risk-Informed Analysis of Transportation Worker Identification Credential (TWIC) Reader Requirements," and either raised concerns or agreed with the conclusions found in the analysis.
The Coast Guard acknowledges receipt of the HSOAC analysis and appreciates the work that was performed to assemble the report. However, at present, we are not able to comment on the analysis, as we continue to evaluate its findings and recommendations.
While all commenters generally supported a delay of up to 6 years, one commenter thought the current 3-year delay could potentially be sufficient for the Coast Guard to review the RAND study, receive additional stakeholder input, and promulgate a new TWIC rule consistent with the new data. That commenter raised concerns about the uncertainty that a lengthy delay may cause for industry, particularly for vendors involved in the production and maintenance of TWIC readers. Two commenters also suggested areas for further study, including on the potential costs of implementing TWIC readers, and proposed several ways of amending the 2016 TWIC Reader final rule in light of the RAND study findings. While we recognize the industry's need for regulatory certainty and clarity, we believe that the delay to May 8, 2029, although potentially lengthening a period of uncertainty, is for the valid purpose of providing time to determine the best course of action with regard to the 2016 TWIC Reader final rule.
V. Discussion of the Rule To Delay the Effective Date
In this final rule (also referred to as the "2023 TWIC Reader Delay rule"), we delay the effective date for certain facilities to May 8, 2029. The 2016 TWIC Reader final rule remains in effect for facilities receiving vessels certificated to carry more than 1,000 passengers, as this final rule does not affect those facilities.
This final rule delays implementing TWIC readers for (1) facilities that handle CDC in bulk but do not transfer those cargoes from or to a vessel; (2) facilities that handle CDC in bulk and do transfer those cargoes from or to a vessel; and (3) facilities that receive vessels carrying CDC in bulk, but do not, during that vessel-to-facility interface, transfer those bulk cargoes from or to those vessels. This delay allows the Coast Guard to accurately determine the affected population through the 2022 RAND Corporation's HSOAC analysis and have further time to analyze the potential effectiveness of the TWIC reader requirement for these facilities. The HSOAC analysis assesses potential risks of CDC, including the types of CDC, population density within a certain distance of the facility, and other risk and consequence aspects.
After the Coast Guard completes its review of the HSOAC analysis, its conclusions, and its recommendations, we will determine whether any future rulemaking regarding the effective date of the 2016 TWIC Reader final rule is necessary. If such a rulemaking begins, industry will be able to provide further input through notice and comment rulemaking.
VI. Regulatory Analyses
[top] This final rule further delays the effective date for three types of facilities affected by the 2016 TWIC Reader final rule. Specifically, these are (1) facilities that handle CDC in bulk, but do not transfer those cargoes from or to a
Below, we provide an updated regulatory analysis of the 2020 TWIC Reader Delay final rule that presents the impacts of delaying the effective date of the final rule for the three types of Risk Group A facilities defined in the preceding paragraph. For this updated analysis, we estimated the costs of this 2023 final rule, the costs of the 2023 Conforming Amendment, and the 2020 TWIC Reader Delay final rule, utilizing a 13-year analysis period in order to compare them to derive the cost savings for our baselines.
A. Regulatory Planning and Review
Executive Orders 12866 (Regulatory Planning and Review), as amended by Executive Order 14094 (Modernizing Regulatory Review), and affirmed by Executive Order 13563 (Improving Regulation and Regulatory Review) direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying costs and benefits, reducing costs, harmonizing rules, and promoting flexibility.
This final rule is a significant regulatory action under section 3(f) of Executive Order 12866, as amended by Executive Order 14094, but it is not significant under section 3(f)(1). Accordingly, the Office of Management and Budget (OMB) has reviewed this final rule. A Regulatory Analysis (RA) follows.
On the 17th of April 2023, the Coast Guard published the 2023 Conforming Amendment, altering the implementation date for TWIC readers in certain risk group A facilities from May 8, 2023, to May 8, 2026. 26 This final rule replaces the 2023 Conforming Amendment, which is currently in effect, and thus delays implementation until May 8, 2029. In order to provide a comprehensive estimate of the impacts of this rulemaking, the Coast Guard utilizes two baselines, a "Pre-Conforming Amendment" ("Pre-CA") baseline and a "No Action" baseline.
Footnotes:
26 ?Document Citation: 88 FR 23349; Page: 23349-23350 (2 pages); CFR: 33 CFR 105; Agency/Docket No. USCG-2023-0265 Document Number: 2023-08040; Federal Register : Transportation Worker Identification Credential-Facility Reader Requirement; Conforming Amendment.
The No Action baseline represents the current state without this rulemaking in other words a world in which the requirements would go into effect in 2025. Quantifying costs against the No Action baseline includes only costs directly attributable to this rule and excludes any costs derived from the 2023 Conforming Amendment. The period of impact for costs for the No Action baseline is 2025 to 2034, and any change in cost or cost savings can be attributed to the difference between the expiration of the 2023 Conforming Amendment and this final rule.
The Pre-CA baseline captures costs across two different time horizons. First, it provides transparency regarding cost savings realized from 2022 to 2025 due to the 2023 Conforming Amendment. Second, it captures new cost savings between 2025 to 2034 that stem from this final rule. The entire period of impact for the Pre-CA baseline is 2022 to 2034. We compare the costs attributed to this baseline to the costs under the 2020 TWIC Reader Delay final rule, resulting in the outlined cost savings. We use an aligned period of analysis across both the No Action and Pre-CA baselines to provide a consistent comparison for our estimates. Therefore, the period of analysis for each baseline in our RA is 2022 to 2034. See Illustration 1 for a depiction of our baselines, periods of impact, and period of analysis.
[Federal Register graphic "ER31OC24.000" is not available. Please view the graphic in the PDF version of this document.]
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In accordance with OMB Circular A-4, we have prepared an accounting statement for each baseline showing the classification of impacts associated with both the Pre-CA and the No Action baselines. We have updated our dollar year to 2023. The No Action baseline can be seen in table 1A, while the Pre-CA baseline can be seen in table 1B.
| Primary estimate | Source | ||
| Benefits | |||
| Annualized monetized benefits | 7% | RA. | |
| 3% | |||
| Annualized quantified, but unmonetized, benefits | None. | RA. | |
| Unquantifiable Benefits | For facilities with a delayed compliance, this final rule will postpone the benefits of electronic TWIC inspection. | RA. | |
| Costs | |||
| Annualized, monetized | 7% | RA. | |
| Costs (Dollars, Millions) | 3% | RA. | |
| Annualized quantified, but unmonetized, costs | None. | RA. | |
| Qualitative (un-quantified) cost savings | None. | RA. | |
| Cost Savings | |||
| Annualized monetized costs (Dollars, Millions) | ($4.36) | 7% | RA. |
| Annualized monetized costs (Dollars, Millions) | ($3.14) | 3% | RA. |
| Annualized quantified, but unmonetized, costs | None. | RA. | |
| Qualitative (un-quantified) cost savings | This final rule delays the cost to retrieve or replace lost personal identification numbers (PINs) to use with TWICs for facilities with delayed implementation. | RA. | |
| Transfers | |||
| Annualized monetized transfers: "on budget" | Not calculated. | RA. | |
| From whom to whom? | RA. | ||
| Annualized monetized transfers: "off-budget" | None. | ||
| From whom to whom? | None. | ||
| Miscellaneous Analyses/Category | |||
| Effects on Tribal, State, and/or local governments | None. | ||
| Effects on small businesses | This final rule does not have a significant economic impact on a substantial number of small entities. | RA. | |
| Effects on wages | None. | ||
| Effects on growth | No determination. | ||
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| Primary estimate | Source | ||
| Benefits | |||
| Annualized monetized benefits | 7% | RA. | |
| 3% | |||
| Annualized quantified, but unmonetized, benefits | None. | RA. | |
| Unquantifiable Benefits | For facilities with a delayed compliance, this final rule will postpone the benefits of electronic TWIC inspection. | RA. | |
| Costs | |||
| Annualized, monetized | 7% | RA. | |
| Costs (Dollars, Millions) | 3% | RA. | |
| Annualized quantified, but unmonetized, costs | None. | RA. | |
| Qualitative (un-quantified) cost savings | None. | RA. | |
| Cost Savings | |||
| Annualized monetized costs (Dollars, Millions) | ($10.49) | 7% | RA. |
| Annualized monetized costs (Dollars, Millions) | ($7.55) | 3% | RA. |
| Annualized quantified, but unmonetized, costs | None. | RA. | |
| Qualitative (un-quantified) cost savings | This final rule delays the cost to retrieve or replace lost personal identification numbers (PINs) to use with TWICs for facilities with delayed implementation. | RA. | |
| Transfers | |||
| Annualized monetized transfers: "on budget" | Not calculated. | RA. | |
| From whom to whom? | RA. | ||
| Annualized monetized transfers: "off-budget" | None. | ||
| From whom to whom? | None. | ||
| Miscellaneous Analyses/Category | |||
| Effects on Tribal, State, and/or local governments | None. | ||
| Effects on small businesses | This final rule does not have a significant economic impact on a substantial number of small entities. | RA. | |
| Effects on wages | None. | ||
| Effects on growth | No determination. | ||
This final rule further delays the effective date for certain facilities-that is, all facilities that handle CDC in bulk-affected by the 2016 TWIC Reader final rule. The current effective date of the 2016 TWIC Reader final rule for these facilities is May 8, 2026. This was established by the 2023 Conforming Amendment (88 FR 23349), which changed the implementation dates in 33 CFR 105.253(a)(2) through (4) from May 8, 2023 to May 8, 2026. With this final rule, the 2023 TWIC Reader Delay rule, we are delaying the effective date for these facilities for 3 years, from the 2023 Conforming Amendment expiration date of May 8, 2026, to May 8, 2029.
[top] This final rule delays the effective date of the 2020 TWIC Reader Delay final rule by an additional 3 years (until May 8, 2029) for (1) facilities that handle CDC in bulk but do not transfer it from or to a vessel; (2) facilities that handle CDC in bulk and do transfer those cargoes from or to a vessel; and (3) facilities that receive vessels carrying
Footnotes:
27 ?The 2016 TWIC Reader final rule's RA is available in the docket; docket number USCG-2007-28915-0231.
In the 2016 TWIC Reader final rule's RA, we estimated that 525 facilities and 1 vessel out of the MTSA-regulated entities (13,825 vessels and more than 3,270 facilities) would have to comply with that final rule's electronic TWIC inspection requirements, using the Maritime Security Risk Analysis Model's (MSRAM's) risk-based tiered approach. 28 Using data from MSRAM, we estimate that this final rule delays the implementation of the 2016 TWIC Reader final rule for 370 of the 525 affected Risk Group A facilities by 3 years, while the remaining 155 facilities and 1 vessel were required to implement the 2016 TWIC Reader final rule requirements by June 8, 2020. While the rule was implemented June 8, 2020, the Coast Guard delayed the enforcement of requirements until January 1, 2022, due to the global COVID-19 pandemic. These 370 facilities are those that (1) handle bulk CDC, but do not transfer it from or to a vessel; (2) handle CDC in bulk and do transfer those cargoes from or to a vessel; and (3) receive vessels carrying bulk CDC but, during the vessel-to-facility interface, do not transfer the bulk CDC from or to those vessels. We did not include these facilities in our MSRAM risk analysis for the 2016 TWIC Reader final rule or in its RA, because we could not determine the number of those facilities at the time.
Footnotes:
28 ?See table 2.8 on page 26 of the 2016 TWIC Reader final rule's regulatory analysis for the estimate of 525 facilities, and table 2.1 on page 23 for the estimate of 1 vessel (In the docket, number USCG-2007-28915-0231).
Varying estimates of the number of facilities that meet the criteria, and that fall into the covered population category, have been provided to the Coast Guard by the 2022 RAND Corporation's HSOAC analysis to improve the risk methodology and determine the new risk groups. The population numbers are currently under internal review while we assess an accurate final count of the population for future regulatory action. The final count of facilities will most likely be similar, but not identical to the cited 370 statistic. Therefore, the Coast Guard is using its discretion to delay the implementation of the 2016 TWIC Reader final rule on those facilities, pending a final facility count. Future regulatory analyses will update these estimates, once the Coast Guard has assessed which CDC facilities fall within the level or risk that is deemed appropriate to require a TWIC reader. If such a rulemaking is begun, industry will be able to provide further input through notice and comment rulemaking.
We updated our final rule cost estimates in the NPRM preceding this final rule, 29 from 2012 to 2023, based on Gross Domestic Product (GDP) deflator data from the U.S. Bureau of Economic Analysis (BEA). 30 The GDP deflator is a measure of the change in price of domestic goods and services purchased by consumers, businesses, and the Government.
Footnotes:
29 ?87 FR 74563.
30 ?For consistency across regulatory analyses, we are using the annual Implicit Price Deflators for Gross Domestic Product (the BEA's National Income and Product Accounts (NIPA) Table 1.1.9) values using 2023, accessed by the Coast Guard through the BEA's publicly available data sets. The NIPA tables can be found at https://apps.bea.gov/iTable/index_nipa.cfm (last visited 04/28/2024).
We do not anticipate any new costs to industry when this final rule is implemented, because this final rule does not change the applicability of the 2020 TWIC Reader Delay final rule or any subsequent amendments thereof. This final rule results in no other changes to the 2020 TWIC Reader Delay final rule. There is no impact to the 1 previously affected vessel and 155 MTSA facilities that complied with the 2020 TWIC Reader Delay final rule as of June 8, 2020. Total cost figures for each prior rule can be found in table 2A, which summarizes the costs of the 2020 TWIC Reader Delay final rule, the 2023 Conforming Amendment, and this final rule.
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| Category | 2020 TWIC Reader Delay final rule | 2023 Conforming Amendment | 2023 TWIC Reader Delay rule |
|---|---|---|---|
| (X) | (Y) | (Z) | |
| Period of Impact & Analysis | Costs begin to be incurred by entities in 2022, and the analysis is from 2022-2034 Discounted costs diverge from the 2020 TWIC Reader Delay final rule due to modification of discounting schedule. Total costs differ due to extended period of analysis | Costs begin to be incurred by entities in 2025, and the analysis is from 2022-2034 | Represents an additional delay of 3 years, effective post 2023 Conforming Amendment. Costs begin to be incurred by entities in 2028, and the analysis is from 2022-2034. |
| Affected Population | 370 facilities that handle bulk CDC, but do not transfer it from or to a vessel, and that handle bulk CDC and do transfer such cargoes from or to a vessel (to comply by May 8, 2023). The rule also applies to facilities that receive vessels carrying bulk CDC, but, during that vessel-to-facility interface, do not transfer bulk CDC from or to the vessel | 370 facilities that handle bulk CDC, but do not transfer it from or to a vessel, and that handle bulk CDC and do transfer such cargoes from or to a vessel (to comply by May 8, 2026). The rule also applies to facilities that receive vessels carrying bulk CDC, but, during that vessel-to-facility interface, do not transfer bulk CDC from or to the vessel | 370 facilities that handle bulk CDC, but do not transfer it from or to a vessel, and that handle bulk CDC and do transfer such cargoes from or to a vessel (to comply by May 8, 2029). The rule also applies to facilities that receive vessels carrying bulk CDC, but, during that vessel-to-facility interface, do not transfer bulk CDC from or to the vessel. However, the number of these facilities cannot be determined at this time. The number of these facilities is currently under review by the Coast Guard and, if warranted, will be published in a future NPRM, which would revise risk groups to comply by May 8, 2029. |
| Costs to Industry and Government (Dollars, millions, 7% discount rate). Annualized | Industry: $23.05 (annualized) Government: $0.008 (annualized) Both: $23.06 (annualized) | Industry: $16.92 (annualized) Government: $0.008 (annualized) Both: $16.93 (annualized) | Industry: $12.56 (annualized). Government: $0.006 (annualized). Both: $12.57 (annualized). |
| Costs to Industry and Government (Dollars, millions, 7% discount rate). Over 13-year analysis period | Industry: $192.63 (13-year) Government: $0.078 (13-year) Both: $192.71 (13-year) | Industry: $141.42 (13-year) Government: $0.063 (13-year) Both: $141.48 (13-year) | Industry: $104.98 (13-year). Government: $0.052 (13-year). Both: $105.03 (13-year). |
| Costs (Qualitative) | Time to retrieve or replace lost PINs for use with TWICs | Delayed enhanced access control and security for the facilities with delayed implementation | Delays enhanced access control and security for the facilities with delayed implementation. |
| Benefits (Qualitative) | Enhanced access control and security at U.S. maritime facilities and on board U.S.-flagged vessels | Time to retrieve or replace lost PINs for use with TWICs | This final rule delays the cost to retrieve or replace lost PINs for use with TWICs for facilities with delayed implementation. |
| Reduction of human error when checking identification and manning access points | Reduction of human error when checking identification and manning access points | Delays the reduction of human error when checking identification and manning access points for the facilities with delayed implementation. |
This final rule results in cumulative cost savings to industry and to the Government of $36.45 million (discounted at 7 percent) over a 13-year period of analysis ($105.03 million-$141.48 million). At a 7-percent discount rate, we estimate the total annualized cost savings to be $4.36 million ($12.57 million-$16.93 million). These numbers can be seen under the column for the No Action baseline in table 2B. Similarly, when accounting for both the savings of the 2023 Conforming Amendment and this final rule, the total cost savings can be seen in the Pre-CA baseline in table 2B.
| Total cost savings (2023 dollars, millions) | No Action baseline = Z - Y | Pre-CA baseline = Z - X |
|---|---|---|
| Annualized (7% discount rate) | Industry: ($4.36) (annualized) Government: ($0.001) (annualized) Total: ($4.36) (annualized) | Industry: ($10.49) (annualized). Government: ($0.003) (annualized). Total: ($10.49) (annualized). |
| 13-Year (7% discount rate) | Industry: ($36.44) (13-year) Government: ($0.01) (13-year) Total: ($36.45) (13-year) | Industry: ($87.66) (13-year). Government: ($0.02) (13-year). Total: ($87.68) (13-year). |
| Annualized (3% discount rate) | Industry: ($3.14) (annualized) Government: ($0.001) (annualized) Total: ($3.14) (annualized) | Industry: ($7.55) (annualized). Government: ($0.001) (annualized). Total: ($7.55) (annualized). |
| 13-Year (3% discount rate) | Industry: ($33.41) (13-year) Government: ($0.01) (13-year) Total: ($33.41) (13-year) | Industry: ($80.31) (13-year). Government: ($0.01) (13-year). Total: ($80.32) (13-year). |
| Note: Totals may not sum due to rounding. | ||
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Methodology
Final Rule Costs Inflated to 2023 Dollars and Adjusted for Discounting
Although we have updated our analysis from the 2016 NPRM for this rulemaking to reflect newer inflation and population figures, we did not modify the methodology of our primary regulatory analyses.
We used an inflation factor from the annual GDP deflator data. We calculated the inflation factor of 1.312 by modifying the deflator base year to 2023 (GDP deflator = 100 at 2023 prices) and dividing the annual 2023 index number (100) by the annual 2012 index number (76.2). We then applied this inflation factor to the costs for vessels and additional costs, which include additional delay costs, travel costs, and the cost to replace TWIC readers that fail.
For facilities, we applied this inflation factor to the total cost-by-cost component, because this final rule applies to only some of these cost elements. Facility costs include capital costs, maintenance costs, and operational costs. Capital costs consist of the cost to purchase and install TWIC readers, as well as the cost to fully replace TWIC readers 5 years after the original installation. Maintenance costs account for the costs to maintain TWIC readers every year after the original installation. Operational costs include costs that occur only at the time of the TWIC reader installation, such as those for amending security plans, creating a recordkeeping system, and initial training. Operational costs also include ongoing costs, administrative duties, including downloading the canceled card list, and ongoing annual training.
For wages, we have updated rates used in the calculations of costs to the most recent available data for the labor category and industry. We obtained wages from the Bureau of Labor Statistics (BLS) Occupational Employment and Wage Estimates, and then we calculated burdened wages (a wage's total cost to the employer) by utilizing the BLS Employer Costs of Employee Compensation multipliers relevant to the job type and industry.
Due to the extended timeframe of analysis, the total undiscounted costs for the 2023 TWIC Reader Delay rule have increased over those presented in the original publication. We have updated the discounting methodology for this rule, changing our base year for discounting to 2023; thus, the discounted totals presented for the 2020 TWIC Reader Delay final rule also diverge from the original publication.
Final Rule Costs
This final rule delays the effective date of the 2020 TWIC Reader delay final rule by an additional 3 years (until May 8, 2029) for 370 facilities that (1) handle bulk CDC but do not transfer it from or to a vessel; (2) facilities that handle CDC in bulk, and do transfer those cargoes from or to a vessel; and (3) an undetermined number of facilities that receive vessels carrying bulk CDC, but do not transfer it from or to the vessel during that vessel-to-facility interface. To allow for a consistent comparison between the baseline estimates and the costs of this rule, we maintain the assumption from the RA in the 2016 TWIC Reader final rule that 50 percent of facilities will comply for each of the 2 final years preceding the final implementation date. Therefore, for this final rule, we assume that 50 percent of facilities with a 3-year implementation delay will comply in May of Year 2028, and 50 percent of facilities with a 6-year implementation delay will comply in Year 2029. We maintain this assumption to provide a consistent comparison between the baseline cost estimates presented in the 2016 TWIC Reader final rule, and the costs of this final rule.
The costs are separated into three categories (undiscounted 2023 dollars): (1) capital costs of which the initial average capital cost per facility will be $322,410; (2) maintenance costs, of which the average annual cost incurred per facility for the first full year of operation following TWIC implementation, will be $4,970; and (3) operational costs, which on average per facility is $6,450 for the first year and, will be $2,173 reoccurring from the second year on. The total undiscounted costs for the first year of operation, on average, per facility, will be the sum of the capital costs and operational costs totaling $328,950. Ongoing annual costs for maintenance and operations will be $7,143 ($4,970 + $2,173).
After the initial 5-year period of use, TWIC readers may need to be replaced. Our assumption is that all readers will need to be replaced at 5-year intervals, although it is likely that this will not be the case, and that only a percentage of readers will need replacement. The average cost per facility to replace its TWIC readers is $5,248.
To estimate the capital costs in a given year, we multiplied the total input capital costs for all facilities by the percentage of facilities incurring costs each year. We estimated operational costs for periods after the first year in a similar manner, multiplying total operational costs by the percentage of facilities complying in a given year. Because maintenance costs are not incurred until the year after the TWIC readers are installed, we calculated the final rule maintenance costs each year by multiplying the total input costs for all facilities by the percentage of facilities complying in the previous year. For example, the first year of implementation costs (Year 2028 in table 3) are capital costs plus operational costs (($322,410 + $6,540) × 185) = $60,855,928 (2023 dollars). Table 3 presents the total cost to facilities under this final rule, and the preceding rules.
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| 2023 TWIC Reader Delay Rule | ||||||
| Year | Number of new facilities complying | Total number of facilities | Capital costs | Maintenance costs | Operational costs | Undiscounted total (A1) |
| 2022 | 0 | 0 | $0.00 | $0.00 | $0.00 | $0.00 |
| 2023 | 0 | 0 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2024 | 0 | 0 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2025 | 0 | 0 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2026 | 0 | 0 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2027 | 0 | 0 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2028 | 185 | 185 | 59.65 | 0.00 | 1.21 | 60.86 |
| 2029 | 185 | 370 | 59.65 | 0.92 | 1.61 | 62.18 |
| 2030 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2031 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2032 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2033 | 0 | 370 | 9.19 | 1.84 | 0.80 | 11.84 |
| 2034 | 0 | 370 | 9.19 | 1.84 | 0.80 | 11.84 |
| Total | 137.68 | 10.11 | 6.84 | 154.64 | ||
| 2023 Conforming Amendment | ||||||
| Year | Number of new facilities complying | Total number of facilities | Capital costs | Maintenance costs | Operational costs | Undiscounted total (A2) |
| 2022 | 0 | 0 | $0.00 | $0.00 | $0.00 | $0.00 |
| 2023 | 0 | 0 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2024 | 0 | 0 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2025 | 185 | 185 | 59.65 | 0.00 | 1.21 | 60.86 |
| 2026 | 185 | 370 | 59.65 | 0.92 | 1.61 | 62.18 |
| 2027 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2028 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2029 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2030 | 0 | 370 | 9.19 | 1.84 | 0.80 | 11.84 |
| 2031 | 0 | 370 | 9.19 | 1.84 | 0.80 | 11.84 |
| 2032 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2033 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2034 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| Total | 137.68 | 15.63 | 9.25 | 162.57 | ||
| 2020 TWIC Reader Delay Final Rule?* | ||||||
| Year | Number of new facilities complying | Total number of facilities | Capital costs | Maintenance costs | Operational costs | Undiscounted total (A3) |
| 2022 | 185 | 185 | 59.65 | 0.00 | 1.21 | 60.86 |
| 2023 | 185 | 370 | 59.65 | 0.92 | 1.61 | 62.18 |
| 2024 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2025 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2026 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2027 | 0 | 370 | 9.19 | 1.84 | 0.80 | 11.84 |
| 2028 | 0 | 370 | 9.19 | 1.84 | 0.80 | 11.84 |
| 2029 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2030 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2031 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| 2032 | 0 | 370 | 9.19 | 1.84 | 0.80 | 11.84 |
| 2033 | 0 | 370 | 9.19 | 1.84 | 0.80 | 11.84 |
| 2034 | 0 | 370 | 0.00 | 1.84 | 0.80 | 2.64 |
| Total | 156.07 | 21.15 | 11.67 | 188.88 | ||
| Note: Totals may not sum due to rounding. | ||||||
| *?Discounted costs and cost savings totals of 2020 TWIC Reader delay final rule presented here diverge from numbers published in rule, due to discounting schedule change and analysis timeframe. | ||||||
[top] Table 4 summarizes the total costs to industry of this final rule in 2023 dollars. This final rule does not impact the compliance schedule for vessels; therefore, these costs remain unchanged. We calculated the additional costs by multiplying the totals in table 3 by the percentage of facilities complying within a given year and phasing them in over 2 years. We estimate the total costs to industry in this final rule to be $104.98 million over 13 years, and for the annualized cost to industry to be $12.56 million at a 7-perent discount rate.
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| Year | Facility | Vessel | Additional costs | Undiscounted | 7% | 3% |
| (A1) | ~ (B1) | C1 = (A1 + B1) | ||||
| 2023 TWIC Reader Delay Rule | ||||||
| 2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 2023 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2024 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2025 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2026 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2027 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2028 | 60.86 | 0.00 | 2.78 | 63.63 | 39.63 | 51.74 |
| 2029 | 62.18 | 0.00 | 5.56 | 67.73 | 39.42 | 53.47 |
| 2030 | 2.64 | 0.00 | 5.56 | 8.20 | 4.46 | 6.28 |
| 2031 | 2.64 | 0.00 | 5.56 | 8.20 | 4.17 | 6.10 |
| 2032 | 2.64 | 0.00 | 5.56 | 8.20 | 3.90 | 5.92 |
| 2033 | 11.84 | 0.00 | 3.77 | 15.61 | 6.93 | 10.95 |
| 2034 | 11.84 | 0.00 | 3.77 | 15.61 | 6.48 | 10.63 |
| Total | 154.64 | 0.00 | 32.54 | 187.18 | 104.98 | 145.09 |
| Annualized | 14.40 | 12.56 | 13.64 | |||
| 2023 Conforming Amendment | ||||||
| Year | Facility | Vessel | Additional costs?* | Undiscounted | 7% | 3% |
| (A2) | (B2) | C2 = (A2 + B2) | ||||
| 2022 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 2023 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | $0.00 |
| 2024 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| 2025 | 60.86 | 0.00 | 2.78 | 63.63 | 48.55 | 56.54 |
| 2026 | 62.18 | 0.00 | 5.56 | 67.73 | 48.29 | 58.43 |
| 2027 | 2.64 | 0.00 | 5.56 | 8.20 | 5.46 | 6.87 |
| 2028 | 2.64 | 0.00 | 5.56 | 8.20 | 5.11 | 6.67 |
| 2029 | 2.64 | 0.00 | 5.56 | 8.20 | 4.77 | 6.47 |
| 2030 | 11.84 | 0.00 | 5.56 | 17.39 | 9.46 | 13.33 |
| 2031 | 11.84 | 0.00 | 5.56 | 17.39 | 8.84 | 12.94 |
| 2032 | 2.64 | 0.00 | 5.56 | 8.20 | 3.90 | 5.92 |
| 2033 | 2.64 | 0.00 | 5.56 | 8.20 | 3.64 | 5.75 |
| 2034 | 2.64 | 0.00 | 5.56 | 8.20 | 3.40 | 5.58 |
| Total | 162.57 | 0.00 | 52.78 | 215.35 | 141.42 | 178.50 |
| Annualized | 16.57 | 16.92 | 16.78 | |||
| 2020 TWIC Reader Delay Final Rule?* | ||||||
| Year | Facility | Vessel | Additional costs | Undiscounted | 7% | 3% |
| (A3) | ~(B3) | C3 = (A3 + B3) | ||||
| 2022 | $60.86 | $0.00 | $2.78 | $63.63 | $59.47 | $61.78 |
| 2023 | 62.18 | 0.00 | 5.56 | 67.73 | 59.16 | 63.85 |
| 2024 | 2.64 | 0.00 | 5.56 | 8.20 | 6.69 | 7.50 |
| 2025 | 2.64 | 0.00 | 5.56 | 8.20 | 6.25 | 7.28 |
| 2026 | 2.64 | 0.00 | 5.56 | 8.20 | 5.85 | 7.07 |
| 2027 | 11.84 | 0.00 | 5.56 | 17.39 | 11.59 | 14.57 |
| 2028 | 11.84 | 0.00 | 5.56 | 17.39 | 10.83 | 14.14 |
| 2029 | 2.64 | 0.00 | 5.56 | 8.20 | 4.77 | 6.47 |
| 2030 | 2.64 | 0.00 | 5.56 | 8.20 | 4.46 | 6.28 |
| 2031 | 2.64 | 0.00 | 5.56 | 8.20 | 4.17 | 6.10 |
| 2032 | 11.84 | 0.00 | 5.56 | 17.39 | 8.26 | 12.57 |
| 2033 | 11.84 | 0.00 | 5.56 | 17.39 | 7.72 | 12.20 |
| 2034 | 2.64 | 0.00 | 5.56 | 8.20 | 3.40 | 5.58 |
| Total | 188.88 | 0.00 | 69.45 | 258.33 | 192.63 | 225.40 |
| Annualized | 19.87 | 23.05 | 21.19 | |||
| *?These costs include additional delay, travel, and TWIC replacement costs due to TWIC failures. |
||||||
| ~?Discounted costs and cost savings totals of 2020 TWIC Reader delay final rule presented here diverge from numbers published in rule, due to discounting schedule change and analysis timeframe. | ||||||
| Note: ?Totals may not sum due to rounding. | ||||||
Table 5A presents the estimated change in total costs to industry from this final rule further delaying the implementation of the 2020 TWIC Reader delay final rule by an additional 3 years (until May 8, 2029) for (1) facilities that handle bulk CDC but do not transfer it from or to a vessel; (2) facilities that handle CDC in bulk and do transfer those cargoes from or to a vessel; and (3) facilities that receive vessels carrying bulk CDC, but do not transfer it from or to the vessel during that vessel-to-facility interface. The costs of this final rule have been compared to the costs displayed in tables 3 and 4 for the 2023 Conforming Amendment. The resulting difference is what this final rule estimates as the cost savings to industry from this final rule's promulgation, represented by our No Action baseline. We estimate, at a 7-percent discount rate, that the annualized cost savings to industry to be $4.36 million, and the total cost savings to be $36.44 million over 13 years for our No Action baseline.
| Year | Undiscounted (= C1-C2) | 7% | 3% |
|---|---|---|---|
| Change in Costs (No Action Baseline) | |||
| 2022 | $0.00 | $0.00 | $0.00 |
| 2023 | 0.00 | 0.00 | 0.00 |
| 2024 | 0.00 | 0.00 | 0.00 |
| 2025 | (63.63) | (48.55) | (56.54) |
| 2026 | (67.73) | (48.29) | (58.43) |
| 2027 | (8.20) | (5.46) | (6.87) |
| 2028 | 55.44 | 34.52 | 45.07 |
| 2029 | 59.53 | 34.65 | 47.00 |
| 2030 | (9.19) | (5.00) | (7.05) |
| 2031 | (9.19) | (4.67) | (6.84) |
| 2032 | 0.00 | 0.00 | 0.00 |
| 2033 | 7.41 | 3.29 | 5.20 |
| 2034 | 7.41 | 3.07 | 5.04 |
| Total | (28.17) | (36.44) | (33.41) |
| Annualized | (4.36) | (3.14) | |
| Note: ?Totals may not sum due to rounding. | |||
Table 5B presents the estimated change in total costs to industry between this final rule and the 2020 TWIC Reader Delay final rule, in addition to the already existing 3-year extension from the 2023 Conforming Amendment, for a total delay of 6 years. The costs of this final rule have been compared to the updated values for the 2020 TWIC Reader Delay final rule, and the resulting difference is the cost saving estimates to industry from this final rule's promulgation. From the cumulative impacts of the 2023 Conforming Amendment and this final rule, we estimate an annualized cost savings to industry of $10.49 million, for over 13 years at a 7-percent discount rate, for a total cost savings of $87.66 million for our Pre-CA baseline.
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| Year | Undiscounted (= C1-C3) | 7% | 3% |
|---|---|---|---|
| Change in Costs (Pre-CA Baseline) | |||
| 2022 | ($63.63) | ($59.47) | ($61.78) |
| 2023 | (67.73) | (59.16) | (63.85) |
| 2024 | (8.20) | (6.69) | (7.50) |
| 2025 | (8.20) | (6.25) | (7.28) |
| 2026 | (8.20) | (5.85) | (7.07) |
| 2027 | (17.39) | (11.59) | (14.57) |
| 2028 | 46.24 | 28.80 | 37.60 |
| 2029 | 59.53 | 34.65 | 47.00 |
| 2030 | 0.00 | 0.00 | 0.00 |
| 2031 | 0.00 | 0.00 | 0.00 |
| 2032 | (9.19) | (4.37) | (6.64) |
| 2033 | (1.79) | (0.79) | (1.25) |
| 2034 | 7.41 | 3.07 | 5.04 |
| Total | (71.15) | (87.66) | (80.31) |
| Annualized | (10.49) | (7.55) | |
| Note: Totals may not sum due to rounding. | |||
Qualitative Costs
We have provided a brief description of the qualitative costs in table 2A. This final rule delays the cost to retrieve or replace lost PINs for use with TWICs for the facilities with delayed implementation.
Government Costs
We expect that this final rule will generate a cost savings to the Government from delaying the review of the revised security plans for 370 Risk Group A facilities that (1) handle bulk CDC, but do not transfer it from or to a vessel; (2) handle CDC in bulk and do transfer those cargoes from or to a vessel; and (3) receive vessels carrying bulk CDC but, during the vessel-to-facility interface, do not transfer the bulk CDC from or to those vessels. There is no change in cost to the Government resulting from TWIC inspections, because inspections are already required under MTSA, and the TWIC reader requirements do not modify these requirements. As such, there is no additional cost to the Government.
To estimate the cost to the Government, we followed the same approach as the industry cost analysis and adjusted the cost estimate presented in the 2016 TWIC Reader final rule's RA from 2012 dollars to 2023 dollars for non-wage inputs. For the Government analysis, we used the 2022 hourly standard in Government wage rate for an E-5 level staff member, $58 per hour, from Commandant Instruction 7310.1W: Reimbursable Standard Rates, in place of the 2012 wage of $49 per hour; these are the most current values that the Coast Guard has been cleared to use for the RA. 31 Due to the change in wage rates, we have included the changed values to the Government's cost schedules for all following tables. We followed the calculations outlined in the 2016 TWIC Reader final rule's RA to estimate an undiscounted cost to the Government of $42,920 in years 2028 and 2029 ($58 × 4 hours per review × 185 plans), which would result from not extending the delay of the 2020 TWIC Reader delay final rule.
Footnotes:
31 ?Because the Coast Guard is not delaying the implementation schedule for vessels, this final rule has no impact on the costs associated with vessel security plans (having already gone into effect and not included in this population); therefore, we did not include those costs in this RA.
Table 6 presents the cost schedule under this final rule, the previous 2023 Conforming Amendment, and the 2020 TWIC Reader delay final rule. We estimated the annualized Government cost to be $6,187 at a 7-percent discount rate, for a total of $51,708 over 13 years, which can be seen under column group A. For each of these rules, costs accumulate over a 2-year period for an undiscounted cost of $42,920, and, in the case of this final rule, occur for the years of 2028 and 2029. The undiscounted costs among all three estimates are the same, only differing in their discounting. To estimate Government costs in Year 2028 and Year 2029, we used the same approach as the above cost estimates.
| Year | 2023 TWIC Reader Delay rule (A) | Total undiscounted (A1) | 7% | 3% | 2023 Conforming Amendment (B) | Total undiscounted (B1) | 7% | 3% | 2020 TWIC Reader Delay final rule?* (C) | Total undiscounted (C1) | 7% | 3% |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2022 | $0 | $0 | $0 | $0 | $0 | $0 | $42,920 | $40,112 | $41,670 | |||
| 2023 | 0 | 0 | 0 | 0 | 0 | 0 | 42,920 | 37,488 | 40,456 | |||
| 2024 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| 2025 | 0 | 0 | 0 | 42,920 | 32,743 | 38,134 | 0 | 0 | 0 | |||
| 2026 | 0 | 0 | 0 | 42,920 | 30,601 | 37,023 | 0 | 0 | 0 | |||
| 2027 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| 2028 | 42,920 | 26,728 | 34,898 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| 2029 | 42,920 | 24,980 | 33,881 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| 2030 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| 2031 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| 2032 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| 2033 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| 2034 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
| Total | 85,840 | 51,708 | 68,779 | 85,840 | 63,345 | 75,157 | 85,840 | 77,600 | 82,126 | |||
| Annualized | 6,187 | 6,467 | 7,579 | 7,067 | 9,285 | 7,722 | ||||||
| *?Discounted costs and cost savings totals of 2020 TWIC Reader Delay final rule presented here diverge from numbers published previously in final rule, due to discounting schedule change and analysis timeframe. | ||||||||||||
| Note: Totals may not sum due to rounding. | ||||||||||||
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Table 7 presents the estimated change in costs to the Government from delaying the implementation of the 2020 TWIC Reader Delay final rule by an additional 3 years (until May 8, 2029); this applies to (1) facilities that handle bulk CDC but do not transfer it from or to a vessel; (2) facilities that handle CDC in bulk and do transfer those cargoes from or to a vessel; and (3) facilities that receive vessels carrying bulk CDC but do not transfer it from or to the vessel during that vessel-to-facility interface. The costs of this final rule have been compared to the costs under the 2023 Conforming Amendment. The resulting difference is what we estimated as the cost savings to the Government from this final rule's promulgation. We estimated an annualized cost savings to the Government of $1,392 and total cost savings of $11,637, in 2023 dollars, at a 7-percent discount rate for our No Action baseline.
| Year | No Action baseline | Change in total undiscounted (= A1-B1) | 7% | 3% | Pre-CA baseline | Change in total undiscounted (= A1-C1) | 7% | 3% |
|---|---|---|---|---|---|---|---|---|
| 2023 TWIC Reader Delay Rule Change in Costs | ||||||||
| 2022 | $0 | $0 | $0 | ($42,920) | ($40,112) | ($41,670) | ||
| 2023 | 0 | 0 | 0 | (42,920) | (37,488) | (40,456) | ||
| 2024 | 0 | 0 | 0 | 0 | 0 | 0 | ||
| 2025 | (42,920) | (32,743) | (38,134) | 0 | 0 | 0 | ||
| 2026 | (42,920) | (30,601) | (37,023) | 0 | 0 | 0 | ||
| 2027 | 0 | 0 | 0 | 0 | 0 | 0 | ||
| 2028 | 42,920 | 26,728 | 34,898 | 42,920 | 26,728 | 34,898 | ||
| 2029 | 42,920 | 24,980 | 33,881 | 42,920 | 24,980 | 33,881 | ||
| 2030 | 0 | 0 | 0 | 0 | 0 | 0 | ||
| 2031 | 0 | 0 | 0 | 0 | 0 | 0 | ||
| 2032 | 0 | 0 | 0 | 0 | 0 | 0 | ||
| 2033 | 0 | 0 | 0 | 0 | 0 | 0 | ||
| 2034 | 0 | 0 | 0 | 0 | 0 | 0 | ||
| Total | 0 | (11,637) | (6,378) | 0 | (25,892) | (13,347) | ||
| Annualized | (1,392) | (600) | (3,098) | (1,255) | ||||
| Note: Totals may not sum due to rounding. | ||||||||
Change in Benefits
As noted, this final rule delays the effective date of the 2016 TWIC Reader final rule requirement for three categories of facilities: (1) facilities that handle bulk CDC but do not transfer it from or to a vessel; (2) facilities that handle CDC and do transfer such cargoes from or to a vessel; and (3) facilities that receive vessels carrying bulk CDC but do not transfer bulk CDC from or to the vessel during that vessel-to-facility interface.
Facilities for which this final rule applies will not realize the enhanced benefits of electronic inspection, such as the increased protection against individuals who do not hold valid TWICs being granted unescorted access, enhanced verification of personal identity, and a reduction in potential vulnerabilities, until May 8, 2029.
In addition, this final rule delays the cost to retrieve or replace lost PINs for use with TWICs for the facilities with delayed implementation. This is an unquantified cost savings which would accrue to individual mariners and the Coast Guard.
Alternatives
(1) Status quo. One regulatory alternative to this final rule is for the Coast Guard to take no action. Taking no further action would result in the implementation on May 8, 2026, of the 2020 TWIC Reader delay final rule, since the 2023 Authorization Act's mandate and the 2023 Conforming Amendment have extended the compliance deadline. These entities would be required to implement the requirements for the electronic inspection of TWICs and would incur the costs we estimated in our 2016 TWIC Reader final rule's RA, unless the Coast Guard granted a waiver.
[top] (2) Waiver approach. Another alternative the Coast Guard considered was a waiver approach. However, because we currently lack a comprehensive risk analysis on the level of individualized facilities, we do not believe this approach maximizes benefits. In the interim period before the Coast Guard's final assessment of the 2022 RAND Corporation's HSOAC analysis' comprehensive risk assessment, the Coast Guard might issue blanket waivers that include facilities that may, indeed, warrant the additional security of electronic inspection. For example, consider two facilities with a 5,000-gallon tank of CDC each. The tank in the first facility is placed near enough to the perimeter fence in a populated area that, if the tank explodes, would kill enough people to cause a transportation security incident (TSI) and, therefore, should require electronic TWIC inspection. That same tank at the other facility is located away from the water in an isolated area within the MTSA footprint (not near a population). If this tank explodes, it would not cause a TSI and, therefore, the facility should not need to conduct electronic TWIC inspection. If the Coast Guard issued a blanket waiver for those facilities with a storage tank of CDC with 5,000 gallons or less, then we would not be properly implementing these requirements to mitigate the risks as intended, as we are currently unable to determine which facilities would pose valid risks of a TSI. Extending the implementation deadline to 2029 will give the Coast Guard sufficient time to analyze the risks these facilities represent, and, if sufficient risks are identified, whether the benefit of electronic TWIC
We rejected both alternatives ("status quo" and "waiver approach") because they do not address our need to conduct a comprehensive risk analysis at the individual facility level to analyze the reader requirement at these facilities. These alternatives also do not address our need to develop a consistent methodology that would form the rationale for the Coast Guard when issuing waivers for these facilities. Additionally, implementing a waiver system will cause facilities to incur additional expenses during the application and renewal process, and it will impose costs on the Coast Guard for reviewing and issuing those waivers. Issuing this final rule will not impose those costs on industry or Government, but will achieve the same functional result.
B. Small Entities
Under the Regulatory Flexibility Act, 5 United States Code (U.S.C.) 601-612, we have considered whether this rule would have a significant economic impact on a substantial number of small entities. The term "small entities" comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.
The Coast Guard is delaying the effective date of the 2016 TWIC Reader final rule from May 8, 2026, which was the implementation date at the start of this rulemaking, until May 8, 2029, for facilities that handle CDC in bulk. We estimate that, consistent with past and present analyses, 370 facilities will experience cost savings under our No Action baseline. We estimate that these facilities will experience an annualized cost savings of approximately $11,784 (with a 7-percent discount rate), and that, on average, each entity owns two facilities and will save approximately $23,567 under our No Action baseline. We calculate that approximately 2 percent of the small entities impacted by this final rule will have a cost savings that is greater than 1 percent but less than 3 percent of their annual revenue. The other 98 percent will have a cost savings that is less than 1 percent of their annual revenue.
Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this final rule will not have a significant economic impact on a substantial number of small entities.
C. Assistance for Small Entities
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996, Public Law 104-121, we offer to assist small entities in understanding this final rule so that they can better evaluate its effects on them and participate in the rulemaking. The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.
Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).
D. Collection of Information
This rule calls for no new or revised collection of information under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501-3520.
E. Federalism
A rule has implications for federalism under Executive Order 13132 (Federalism) if it has a substantial direct effect on 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. We have analyzed this final rule under Executive Order 13132 and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132. Our analysis follows.
This final rule delays the implementation of existing regulations that create a risk-based set of security measures for MTSA-regulated facilities. Based on this analysis, each facility is classified according to its risk level, which then determines whether the facility will be required to conduct electronic TWIC inspection. As this final rule does not impose any new requirements, but simply delays the implementation of existing requirements, it does not have a preemptive impact. Please refer to the Coast Guard's federalism analysis in the 2016 TWIC Reader final rule (81 FR 57652, 57706, August 23, 2016) for additional information.
While it is well settled that States may not regulate in categories in which Congress intended the Coast Guard to be the sole source of a vessel's obligations, States and local governments have traditionally shared certain regulatory jurisdiction over waterfront facilities. MTSA standards contained in 33 CFR part 105 (Maritime security: Facilities) are not preemptive of State or local law or regulations that do not conflict with them (that is, they would either conflict or would frustrate an overriding Federal need for uniformity).
The Coast Guard recognizes the key role that State and local governments may have in making regulatory determinations. Additionally, for rules with federalism implications and preemptive effect, Executive Order 13132 specifically directs agencies to consult with State and local governments during the rulemaking process. If you believe this Final Rule has implications for federalism under Executive Order 13132, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section of this preamble.
F. Unfunded Mandates
The Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1531-1538, requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Although this final rule will not result in such expenditure, we do discuss the effects of this final rule elsewhere in this preamble.
G. Taking of Private Property
This final rule will not cause a taking of private property or otherwise have taking implications under Executive Order 12630 (Governmental Actions and Interference with Constitutionally Protected Property Rights).
H. Civil Justice Reform
This final rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988 (Civil Justice Reform) to minimize litigation, eliminate ambiguity, and reduce burden.
I. Protection of Children
[top] We have analyzed this final rule under Executive Order 13045 (Protection of Children from Environmental Health Risks and Safety Risks). This final rule is not an economically significant rule and will not create an environmental risk to
J. Indian Tribal Governments
This final rule does not have tribal implications under Executive Order 13175 (Consultation and Coordination with Indian Tribal Governments), because it will not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.
K. Energy Effects
We have analyzed this final rule under Executive Order 13211 (Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use). We have determined that it is not a "significant energy action" under Executive Order 13211, because although it is a "significant regulatory action" under Executive Order 12866, it is not likely to have a significant adverse effect on the supply, distribution, or use of energy, and the Administrator of OMB's Office of Information and Regulatory Affairs has not designated it as a significant energy action.
L. Technical Standards
The National Technology Transfer and Advancement Act, codified as a note to 15 U.S.C. 272, directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through OMB, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( e.g., specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies.
This final rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.
M. Environment
We have analyzed this final rule under DHS Management Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have made a determination that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. A Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble. This final rule is categorically excluded under paragraph L54 of Appendix A, Table 1 of DHS Instruction Manual 023-01(series). Paragraph L54 pertains to regulations that are editorial or procedural.
List of Subjects in 33 CFR Part 105
Maritime security, Navigation (water), Reporting and recordkeeping requirements, Security measures, Waterways.
For the reasons listed in the preamble, the Coast Guard amends 33 CFR part 105 as follows:
PART 105-MARITIME SECURITY: FACILITIES
1. The authority citation for part 105 is revised to read as follows:
Authority:
46 U.S.C. 70034, 70103, 70116; sec. 811, Pub. L. 111-281, 124 Stat. 2905 (46 U.S.C. 70103 note); 33 CFR 1.05-1, 6.04-11, 6.14, 6.16, and 6.19; DHS Delegation No. 00170.1, Revision No. 01.4.
2. In §?105.253, revise paragraphs (a)(2) through (4) to read as follows:
§?105.253 Risk Group classifications for facilities.
(a) * * *
(2) Beginning May 8, 2029: Facilities that handle Certain Dangerous Cargoes (CDC) in bulk and transfer such cargoes from or to a vessel.
(3) Beginning May 8, 2029: Facilities that handle CDC in bulk, but do not transfer it from or to a vessel.
(4) Beginning May 8, 2029: Facilities that receive vessels carrying CDC in bulk but, during the vessel-to-facility interface, do not transfer it from or to the vessel.
Dated: October 17, 2024.
Linda L. Fagan,
Admiral, U.S. Coast Guard, Commandant.
[FR Doc. 2024-24780 Filed 10-30-24; 8:45 am]
BILLING CODE 9110-04-P