Proposed Rule2023-13081
Exemption From Operating Authority Regulations for Providers of Recreational Activities
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
June 21, 2023
Issuing agencies
Transportation DepartmentFederal Motor Carrier Safety Administration
Abstract
FMCSA proposes the implementation of the statutory exemption from its operating authority registration rules for providers of recreational activities. The exemption would apply to motor carriers operating a motor vehicle designed or used to transport between 9 and 15 passengers (including the driver), whether operated alone or with a trailer attached to the transport vehicle, if the motor vehicle is operated by a person that provides recreational activities within a 150 air-mile radius of the location at which passengers initially boarded the motor vehicle at the beginning of the trip. FMCSA also proposes to define recreational activities to clarify the scope of this exemption.
Full Text
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<title>Federal Register, Volume 88 Issue 118 (Wednesday, June 21, 2023)</title>
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[Federal Register Volume 88, Number 118 (Wednesday, June 21, 2023)]
[Proposed Rules]
[Pages 40146-40160]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-13081]
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DEPARTMENT OF TRANSPORTATION
Federal Motor Carrier Safety Administration
49 CFR Part 372
[Docket No. FMCSA-2023-0007]
RIN 2126-AC57
Exemption From Operating Authority Regulations for Providers of
Recreational Activities
AGENCY: Federal Motor Carrier Safety Administration (FMCSA), Department
of Transportation (DOT).
ACTION: Notice of proposed rulemaking.
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SUMMARY: FMCSA proposes the implementation of the statutory exemption
from its operating authority registration rules for providers of
recreational activities. The exemption would apply to motor carriers
operating a motor vehicle designed or used to transport between 9 and
15 passengers (including the driver), whether operated alone or with a
trailer attached to the transport vehicle, if the motor vehicle is
operated by a person that provides recreational activities within a 150
air-mile radius of the location at which passengers initially boarded
the motor vehicle at the beginning of the trip. FMCSA also proposes to
define recreational activities to clarify the scope of this exemption.
DATES: Comments must be received on or before August 21, 2023.
ADDRESSES: You may submit comments identified by Docket Number FMCSA-
2023-0007 using any of the following methods:
<bullet> Federal eRulemaking Portal: Go to <a href="https://www.regulations.gov/docket/FMCSA-2023-0007/document">https://www.regulations.gov/docket/FMCSA-2023-0007/document</a>. Follow the online
instructions for submitting comments.
<bullet> Mail: Dockets Operations, U.S. Department of
Transportation, 1200 New Jersey Avenue SE, West Building, Ground Floor,
Room W12-140, Washington, DC 20590-0001.
<bullet> Hand Delivery or Courier: Dockets Operations, U.S.
Department of Transportation, 1200 New Jersey Avenue SE, West Building,
Ground Floor, Room W12-140, Washington, DC 20590-0001, between 9 a.m.
and 5 p.m., Monday through Friday, except Federal holidays. To be sure
someone is there to help you, please call (202) 366-9317 or (202) 366-
9826 before visiting Dockets Operations.
<bullet> Fax: (202) 493-2251.
FOR FURTHER INFORMATION CONTACT: Mr. Antonio Harris, Registration,
Licensing and Insurance Division, Office of Research and Registration,
FMCSA, 1200 New Jersey Avenue SE, Washington, DC 20590-0001; (202) 366-
2964; <a href="/cdn-cgi/l/email-protection#22434c564d4c4b4d0c4a4350504b5162464d560c454d54"><span class="__cf_email__" data-cfemail="91f0ffe5fefff8febff9f0e3e3f8e2d1f5fee5bff6fee7">[email protected]</span></a>. If you have questions on viewing or
submitting material to the docket, call Dockets Operations at (202)
366-9826.
SUPPLEMENTARY INFORMATION: FMCSA organizes this notice of proposed
rulemaking (NPRM) as follows:
I. Public Participation and Request for Comments
A. Submitting Comments
B. Viewing Comments and Documents
C. Privacy
II. Executive Summary
A. Purpose and Summary of the Regulatory Action
B. Summary of Major Provisions
C. Costs and Benefits
III. Abbreviations
IV. Legal Basis
V. Background
VI. Discussion of Proposed Rulemaking
VII. Section-by-Section Analysis
VIII. Regulatory Analyses
A. E.O. 12866 (Regulatory Planning and Review), E.O. 13563
(Improving Regulation and Regulatory Review), E.O. 14094
(Modernizing Regulatory Review), and DOT Regulatory Policies and
Procedures
B. Congressional Review Act
C. Advance Notice of Proposed Rulemaking
D. Regulatory Flexibility Act (Small Entities)
E. Assistance for Small Entities
F. Unfunded Mandates Reform Act of 1995
G. Paperwork Reduction Act (Collection of Information)
H. E.O. 13132 (Federalism)
I. Privacy
J. E.O. 13175 (Indian Tribal Governments)
K. National Environmental Policy Act of 1969
I. Public Participation and Request for Comments
A. Submitting Comments
If you submit a comment, please include the docket number for this
NPRM (FMCSA-2023-0007), indicate the specific section of this document
to which your comment applies, and provide a reason for each suggestion
or recommendation. You may submit your comments and material online or
by fax, mail, or hand delivery, but please use only one of these means.
FMCSA recommends that you include your name and a mailing address, an
email address, or a phone number in the body of your document so FMCSA
can contact you if there are questions regarding your submission.
To submit your comment online, go to <a href="https://www.regulations.gov/docket/FMCSA-2023-0007/document">https://www.regulations.gov/docket/FMCSA-2023-0007/document</a>, click on this NPRM, click ``Comment,''
and type your comment into the text box on the following screen.
[[Page 40147]]
If you submit your comments by mail or hand delivery, submit them
in an unbound format, no larger than 8\1/2\ by 11 inches, suitable for
copying and electronic filing. If you submit comments by mail and would
like to know that they reached the facility, please enclose a stamped,
self-addressed postcard or envelope.
FMCSA will consider all comments and material received during the
comment period.
Confidential Business Information (CBI)
CBI is commercial or financial information that is both customarily
and actually treated as private by its owner. Under the Freedom of
Information Act (5 U.S.C. 552), CBI is exempt from public disclosure.
If your comments responsive to the NPRM contain commercial or financial
information that is customarily treated as private, that you actually
treat as private, and that is relevant or responsive to the NPRM, it is
important that you clearly designate the submitted comments as CBI.
Please mark each page of your submission that constitutes CBI as
``PROPIN'' to indicate it contains proprietary information. FMCSA will
treat such marked submissions as confidential under the Freedom of
Information Act, and they will not be placed in the public docket of
the NPRM. Submissions containing CBI should be sent to Mr. Brian
Dahlin, Chief, Regulatory Evaluation Division, Office of Policy, FMCSA,
1200 New Jersey Avenue SE, Washington, DC 20590-0001. Any comments
FMCSA receives not specifically designated as CBI will be placed in the
public docket for this rulemaking.
B. Viewing Comments and Documents
To view any documents mentioned as being available in the docket,
go to <a href="https://www.regulations.gov/docket/FMCSA-2023-0007/document">https://www.regulations.gov/docket/FMCSA-2023-0007/document</a> and
choose the document to review. To view comments, click this NPRM, then
click ``Browse Comments.'' If you do not have access to the internet,
you may view the docket online by visiting Dockets Operations in Room
W12-140 on the ground floor of the DOT West Building, 1200 New Jersey
Avenue SE, Washington, DC 20590-0001, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays. To be sure someone is there to
help you, please call (202) 366-9317 or (202) 366-9826 before visiting
Dockets Operations.
C. Privacy
DOT solicits comments from the public to better inform its
regulatory process, in accordance with 5 U.S.C. 553(c). DOT posts these
comments, without edit, including any personal information the
commenter provides, to <a href="http://www.regulations.gov">www.regulations.gov</a>, as described in the system
of records notice (DOT/ALL 14--Federal Docket Management System), which
can be reviewed at <a href="https://www.govinfo.gov/content/pkg/FR-2008-01-17/pdf/E8-785.pdf">https://www.govinfo.gov/content/pkg/FR-2008-01-17/pdf/E8-785.pdf</a>.
II. Executive Summary
A. Purpose and Summary of the Regulatory Action
Section 23012 of the Infrastructure Investment and Jobs Act (IIJA)
(Pub. L. 117-58, 135 Stat. 429 (H.R. 3684, Nov. 15, 2021)) amended 49
U.S.C. 13506 by adding, in paragraph (b)(4), a new exemption from
FMCSA's operating authority registration requirements. FMCSA proposes
the addition of new regulatory text implementing this statutory
exemption. The exemption from operating authority registration applies
to motor carriers operating a motor vehicle designed or used to
transport between 9 and 15 passengers (including the driver), whether
operated alone or with a trailer attached to the transport vehicle, if
the motor vehicle is operated by a person \1\ that provides
recreational activities and the transportation is provided within a 150
air-mile radius of the location at which passengers initially boarded
the motor vehicle at the outset of the trip.
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\1\ While the statute refers to a ``person,'' that term can
refer both to an individual or to a motor carrier under the
definitions of that term in 49 U.S.C. 13102(18) and 1 U.S.C. 1.
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FMCSA also proposes to define recreational activities to clarify
the scope of this exemption. The statute, which requires that the motor
vehicle be operated ``by a person that provides recreational
activities,'' does not define recreational activities. The proposed
definition would clarify the types of recreational activities the
Agency has determined would qualify for the exemption in 49 U.S.C.
13506(b)(4). FMCSA limited the proposed definition of recreational
activities to the types of activities that Congress outlined in the
IIJA for another section that uses this term. Section 11512 provided
examples of ``groups representing recreational activities and
interests'' in subsection (c)(4) which provided some insight as to
legislative intent for the term recreational activities in section
23012. The definition FMCSA proposes in implementing section 23012
includes activities Congress mentioned in section 11512 and also
describes activities that fall outside the intended scope of the term.
This language is intended to provide context of the activities within
the scope of the exemption, based on the intent of Congress, and to
allow sufficient flexibility for analysis of the term's applicability
to future activities.
B. Costs and Benefits
The cost impacts of the proposed definition include changes in
paperwork, fees, and insurance costs associated with maintaining
operating authority. Because there is no pre-existing definition of
recreational activities, motor carriers may be interpreting their
eligibility for the operating authority exemption in varying ways.
Depending on current interpretations, this proposed rule would either
increase, decrease, or have no incremental impact on the degree to
which the operating authority exemptions are used relative to the
baseline. Differences in interpretation between regulated entities and
enforcement officials may be hindering consistent enforcement
practices, thereby impacting business-related decisions in providing
transportation for recreational activities. This rulemaking would
resolve this information asymmetry and enforcement differences by
creating a common understanding between FMCSA and motor carriers.
Because this rulemaking may also lead to an increase in exemption use,
it would benefit existing carriers by improving the efficiency of their
business operations and increasing both consumer and producer surplus.
For new potential providers of recreational activities that were not
aware of this exemption, this rulemaking may encourage new entrants
into the field.
III. Abbreviations
ANPRM Advance Notice of Proposed Rulemaking
BLS Bureau of Labor Statistics
CBI Confidential Business Information
CE Categorical Exclusion
CFR Code of Federal Regulations
DOL U.S. Department of Labor
DOT Department of Transportation
E.O. Executive Order
FMCSA Federal Motor Carrier Safety Administration
FMCSRs Federal Motor Carrier Safety Regulations
FR Federal Register
GDP Gross Domestic Product
ICR Information Collection Request
IRFA Initial Regulatory Flexibility Analysis
IIJA Infrastructure Investment and Jobs Act
MCMIS Motor Carrier Management Information System
NAICS North American Industry Classification System
NPRM Notice of Proposed Rulemaking
OEWS Occupational Employment and Wage Statistics
OMB Office of Management and Budget
PIA Privacy Impact Assessment
[[Page 40148]]
PTA Privacy Threshold Assessment
Secretary The Secretary of the Department of Transportation
SBA Small Business Administration
UMRA Unfunded Mandates Reform Act of 1995
URS Unified Registration System
U.S.C. United States Code
USDOT United States Department of Transportation
IV. Legal Basis for the Rulemaking
Section 23012 of the IIJA (Pub. L. 117-58, 135 Stat. 429 (H.R.
3684, Nov. 15, 2021)) amended 49 U.S.C. 13506 by adding a new exemption
from the requirement to obtain operating authority registration for
``providers of recreational activities'' operating passenger vehicles
designed or used to transport between 9 and 15 passengers (including
the driver) (see 49 U.S.C. 13506(b)(4)). The statute, which requires
that the motor vehicle be operated ``by a person that provides
recreational activities,'' does not define recreational activities.
This NPRM proposes to define recreational activities to clarify the
scope of the exemption applicability.
Under 49 Code of Federal Regulations (CFR) 1.87(a)(5), the
authority of the Secretary of the Department of Transportation (the
Secretary) to carry out the functions relating to the registration
requirements in 49 U.S.C. 13901 and 13902 is delegated to the FMCSA
Administrator. Sections 13901 and 13902 generally require that any
person that wishes to provide transportation subject to jurisdiction
under subchapter I of chapter 135 \2\ must be registered as a motor
carrier, defined in 49 U.S.C. 13102(14) as ``a person providing motor
vehicle transportation for compensation.'' The requirements of these
sections, which are enforced under Sec. 392.9a (``Operating
authority''), are the basis for the rules governing applications for
operating authority registration in 49 CFR part 365.
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\2\ Absent an exemption, the Secretary has jurisdiction over
transportation by motor carrier and the procurement of that
transportation, to the extent that passengers, property, or both,
are transported by motor carrier in interstate commerce (49 U.S.C.
13501). This authority has been delegated to the FMCSA Administrator
under 49 CFR 1.87(a)(3).
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V. Background
Before commencing operations, any person desiring to engage in for-
hire interstate transportation of passengers, regardless of vehicle
size or passenger seating capacity, must first obtain operating
authority registration, unless a specific exemption applies (49 U.S.C.
13102 (14), 13501, 13506, 13901, 13902, and 49 CFR part 365). The
relevant regulations governing such operations derive from Title 49,
Subtitle IV, Part B, and are frequently referred to as the ``commercial
regulations,'' (49 U.S.C. 13102(14), 13902 and 49 CFR part 365).
Historically, the regulations promulgated pursuant to this authority
were largely economic in nature and did not contain new safety
requirements. Today, the most substantial regulatory requirements
remaining under this authority require for-hire non-exempt motor
carriers to maintain evidence of financial responsibility on file with
FMCSA at all times, regardless of whether the carrier is actively
operating, and to maintain an active process agent filing designating
an agent for the receipt of service of process in every state (49 CFR
part 366 and 49 CFR 387.301T).\3\ The exemptions from the commercial
regulations, including the exemption for providers of recreational
activities, are enumerated in 49 U.S.C. 13506 and codified in 49 CFR
part 372.
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\3\ Though providers of recreational activities may not be
required to maintain an active process agent filing with FMCSA,
other State and Federal law may also require those providers to
maintain a process agent in order to engage in business in more than
one State. Accordingly, any cost associated with maintaining a
process agent, generally, would not automatically be alleviated by
this rulemaking.
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Congress adopted multiple exemptions to these commercial
regulations that provided financial relief for certain industries while
still maintaining safety oversight over the same operators. Exemptions
from the commercial regulations do not impede the Agency's oversight of
operations subject to the Agency's separate safety jurisdiction
codified in the Motor Carrier Act of 1935 (Pub. L. 74-255, 49 Stat.
543, Aug. 9, 1935), as amended (the 1935 Act) (codified in 49 U.S.C.
31502); the Motor Carrier Safety Act of 1984 (Pub. L. 98-554, Title II,
98 Stat. 2832, Oct. 30, 1984), as amended (codified in 49 U.S.C.
chapter 311); and the Commercial Motor Vehicle Safety Act of 1986 (Pub.
L. 99-570, Title XII, 100 Stat. 3207-170, Oct. 27, 1986), as amended
(codified in 49 U.S.C. chapter 313). A carrier may be exempt from the
commercial regulations, relieving them of the obligation to obtain
operating authority, file evidence of financial responsibility, and
designation of a process agent. The statutory exemptions in 49 U.S.C.
13506 however, relieve the carrier only of the obligation to file with
FMCSA evidence of financial responsibility, not the obligation to
maintain financial responsibility when engaged in operations. Thus, if
the carrier is operating a commercial motor vehicle as defined in 49
U.S.C. chapter 311, the carrier is still required to maintain minimum
levels of financial responsibility in order to operate. (49 U.S.C.
31138 and 49 CFR part 387, subpart B).
The operating authority registration required under 49 U.S.C.
13901, 13902, and 13906, provides FMCSA with information about motor
carriers and their operations. Although the requirements for operating
authority registration apply only to carriers subject to the Agency's
commercial regulations, they also provide FMCSA with an opportunity to
evaluate those potential new entrant motor carriers' willingness and
ability to comply with all commercial and safety regulations (49 U.S.C.
13902). This opportunity, consistent with the Agency's mission to
reduce crashes and fatalities, allows FMCSA to prevent carriers who may
pose a significant safety risk from entering the industry. Motor
carriers operating vehicles for compensation, in interstate commerce
and not subject to exemption are prohibited from operating without the
required operating authority or beyond the scope of the operating
authority granted (Sec. 392.9a). A motor carrier that violates this
provision shall be ordered out of service and may be subject to
penalties (Sec. 392.9a(b)).
The Agency, however, also requires registration under its safety
jurisdiction, 49 U.S.C. 31134. As a result, if the carrier has
registered and received a USDOT number under FMCSA's safety
jurisdiction, the Agency will still maintain adequate information to
monitor the motor carrier's safety performance and compliance, even if
the carrier is not required to obtain operating authority registration.
FMCSA is required to register a motor carrier for operating
authority registration under 49 U.S.C. 13902 only if the applicant is
willing and able to comply with all statutory and regulatory
requirements for registration (49 U.S.C. 13902, 49 U.S.C. 13906, and 49
CFR part 365). To obtain operating authority registration, each
applicant is required to file the appropriate form for the scope of its
operations (e.g., to operate as a motor carrier of passengers).
Applicants that have never held a USDOT number or any other
registration issued by FMCSA must file the Unified Registration System
(URS) online application (Form MCSA-1) to obtain a USDOT number and
register for operating authority. Applicants that already have a USDOT
number but desire to expand to an operation requiring operating
authority, such as transporting passengers in interstate commerce for
compensation, must file the ``Application for Motor Passenger
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Carrier Authority'' (Form OP-1(P)), or other appropriate OP-1 series
form for the proposed operation to register for operating authority
(Sec. 365.105T), for a fee, currently $300. Again, among other
requirements, the statutory requirements for registration require that
the applicant have on file with FMCSA proof of liability insurance
meeting the minimum levels of financial responsibility required (49
U.S.C. 13902, 49 U.S.C. 13906, and 49 CFR part 365). Motor carriers
must submit the ``Motor Carrier Automobile Bodily Injury and Property
Damage Liability Certificate of Insurance'' (Form BMC-91, for a single
insurance provider, or Form BMC-91X, for an aggregation of insurance
coverage) to satisfy the financial responsibility requirements. A
registration remains in effect only as long as the registrant continues
to satisfy these financial responsibility requirements in 49 U.S.C.
13906.
Before the enactment of section 23012 of the IIJA, a provider of
recreational activities operating as a motor carrier of passengers was
required to maintain insurance at the minimum prescribed levels \4\ for
the entire year--including the months during which the provider was not
operating. As a result, some providers of recreational activities were
voluntarily revoking their operating authority registrations \5\ during
the off-season months by filing Form OCE-46 so that they did not need
to maintain insurance at the minimum prescribed levels during those
months. To resume operations, the providers were then required to
obtain adequate financial responsibility, ensure evidence of financial
responsibility is filed with FMCSA on Form BMC-91 or BMC-91X, and
request to reinstate their operating authority registrations by
submitting the ``Motor Carrier Records Change'' (MCSA-5889) either
online or by paper during the months when they were operating, for an
additional fee, currently $80.\6\
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\4\ The minimum levels of financial responsibility required to
be maintained by for-hire motor carriers of passengers operating
motor vehicles in interstate or foreign commerce can be found in 49
CFR part 387, subpart B. Section 387.31 prohibits a motor carrier
from operating a motor vehicle transporting passengers until the
motor carrier has obtained and has in effect the minimum levels of
financial responsibility as forth in Sec. 387.33. The minimum level
of financial responsibility is $1,500,000 for for-hire motor
carriers of passengers operating a vehicle with a seating capacity
of 15 passengers or less, including the driver (Sec. 387.33T).
\5\ It should be noted that these revocations did not affect the
status of each carrier's safety registration (USDOT number
registration under 49 U.S.C. 31134), which remained intact and was
still required to be updated biennially by the motor carrier (Sec.
390.201).
\6\ The MCSA-5889 may be submitted by mail, fax, or filled out
online. <a href="https://ask.fmcsa.dot.gov/app/answers/detail/a_id/213/session/L3RpbWUvMTQ0Nzg3MzYwOS9zaWQvQXlsamRRQm0=">https://ask.fmcsa.dot.gov/app/answers/detail/a_id/213/session/L3RpbWUvMTQ0Nzg3MzYwOS9zaWQvQXlsamRRQm0=</a>.
Section 23012 of the IIJA created a new exemption from the
requirement to obtain FMCSA operating authority registration for
providers of recreational activities operating a motor vehicle
designed or used to transport not fewer than 9, and not more than 15
passengers (including the driver) whether operated alone or with a
trailer \7\ attached to the transport vehicle if:
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\7\ The exemption includes passenger carrier operators who may
also be required to have and maintain operating authority to
transport property. FMCSA recognizes that a property carrier may
also be transporting property for hire within the scope of its
recreational activities operation. The Agency believes that the
number of carriers requiring additional operating authority to
transport property, however, is extremely limited.
1. The motor vehicle is operated by a person that provides
recreational activities;
2. The transportation is provided within a 150 air-mile radius
of the location at which passengers initially boarded the motor
vehicle at the outset of the trip; and
3. In the case of a motor vehicle transporting passengers over a
route between a place in a State and a place in another State, the
person operating the motor vehicle is lawfully providing
transportation of passengers over the entire route in accordance
with applicable State law.
In this NPRM, FMCSA is undertaking only to clarify the term
recreational activities, as the Agency believes that the other
provisions in section 23012 are unambiguous.
The recreational activity industry is comprised of numerous
companies, associations, and organizations that focus primarily on
outdoor activities. Outdoor activities may include hunting, fishing,
trapping, camping, exploring caves, nature study, bicycling, horseback
riding, bird watching, motorcycling, ballooning, hang-gliding, hiking,
tobogganing, sledding, sleigh riding, snowmobiling, skiing, skating,
water sports, rock climbing, climbing observation towers, sport
shooting, whitewater rafting, and other outdoor sport, game, or
educational activities.
Congress did not define the term recreational activities in the
IIJA and there is no current definition in statute or regulation. The
lack of a definition of recreational activities has caused confusion
for the industry and safety oversight agencies that may result in
myriad interpretations and a patchwork of compliance. This NPRM
proposes to define recreational activities consistent with the Agency's
understanding of congressional intent when establishing the
exemption.\8\
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\8\ As explained in section VI of this rulemaking, FMCSA's
interpretation of the term recreational activities has been informed
by the legislative history of the IIJA. This interpretation has been
further informed by the Agency's experiences in applying the
operating authority requirements, particularly by the questions and
concerns FMCSA has received from motor carriers regarding voluntary
revocation of operating authority, e.g., carriers wishing to cancel
or decrease their insurance during the off season.
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VI. Discussion of Proposed Rulemaking
FMCSA proposes a new Sec. 372.113 that outlines the exemption from
operating authority registration for providers of recreational
activities in 49 U.S.C. 13506(b)(4). This new section would reflect the
statutory language and incorporate the exemption into the FMCSRs.
The Agency also proposes a new definition of recreational
activities to Sec. 372.107 which would provide a clear description of
the types of activities that qualify for the exemption in 49 U.S.C.
13506(b)(4). Based on the statute itself and Congress' use of the term
elsewhere in the IIJA, FMCSA believes Congress intended to provide an
exemption to providers of recreational activities that consist of
outdoor experiences or excursions typically of a physical or athletic
nature that do not have transportation as an integral part of the
activity itself.
In reaching this conclusion, FMCSA has drawn from the canons of
statutory construction and applied the presumption of consistent usage.
The U.S. Supreme Court has framed this presumption as ``a natural
presumption that identical words used in different parts of the same
act are intended to have the same meaning'' (Atlantic Cleaners &
Dryers, Inc. v. United States, 286 U.S. 427, 433 (1932)). The
presumption should be ``applied . . . pragmatically'' (Antonin Scalia &
Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 171
(2012)). FMCSA's interpretation of the types of activities Congress
intended to include in the term recreational activities is therefore
potentially informed by Congress' use of the same term in section 11512
of the IIJA, which directs the Secretary to conduct a nonhighway
recreational fuel study. Subsection (c)(4) states the Secretary may
consult with groups representing recreational activities and interests,
including hiking, biking and mountain biking, horseback riding, water
trails, snowshoeing, cross-country skiing, snowmobiling, off-highway
motorcycling, all-terrain vehicles and other offroad motorized vehicle
activities, and recreational trail advocates (23 U.S.C. 203 note).
The application of this presumption does have limitations. Although
the term recreational activities is found within the same act, it is
used in
[[Page 40150]]
different titles of this lengthy legislation, and applies to different
operating administrations within DOT. Nonetheless, while the use of
this term in section 11512 is not dispositive of its meaning in section
13506, it can still be potentially informative of Congress' intent.
Applying the presumption of consistent usage pragmatically, the
language in section 11512 potentially provides insight into the types
of activities that Congress intended to be covered by the term
recreational activities under section 13506 of the IIJA. Accordingly,
FMCSA limited the proposed definition of recreational activities to
similar types of activities, as informed by FMCSA's experience.\9\
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\9\ See Footnote 8. For example, in response to a DOT notice
requesting that the public identify and provide input on the
Department's existing guidance documents that are good candidates
for repeal, replacement, or modification (84 FR 1820, Feb. 5, 2019),
the America Outdoors Association (AOA) submitted an undated comment
to the Docket (received Apr. 8, 2019) requesting that FMCSA amend
its guidance on operating authority, stating that the costs to
reinstate operating authority were an unnecessary expense with no
added safety benefit. See <a href="https://www.regulations.gov/comment/DOT-OST-2017-0069-2865">https://www.regulations.gov/comment/DOT-OST-2017-0069-2865</a>. (The comment is also available in the docket for
this rulemaking.) AOA requested, in part, that FMCSA provide an
exemption from the operating authority requirements for
transportation by 9 to 15 passenger vehicles, when such
transportation is provided by an entity that provides recreational
activities, is not for direct compensation, and is provided entirely
within a 150 air-mile radius of trip origination, provided that
drivers carry appropriate commercial driver's licenses if needed,
the State in which the vehicle is registered has adopted Federal
inspection standards, and the operator is in compliance with State
requirements.
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Based on these findings, FMCSA proposes to define recreational
activities which qualify for the exemption under 49 U.S.C. 13506(b)(4)
as
. . . activities consisting of an outdoor experience or excursion
typically of a physical or athletic nature which require
transportation for the sole purpose of moving customers to another
location or locations where the experience or excursion will take
place and collecting those customers to transport them back to the
place of initial boarding or another outpost of the motor carrier.
Recreational activities under this proposed definition would
include things such as hiking, biking, horseback riding, canoeing,
whitewater rafting, water trails, tubing, skiing, snowshoeing,
snowmobiling, hunting, fishing, mountain climbing, and swimming. While
this list of activities in the proposed definition is not all
inclusive, it provides sufficient examples to clarify the specific
types of activities that would qualify for the exemption.
FMCSA believes that, by including the language a person ``that
provides'' recreational activities in the exemption, Congress intended
to limit the exemption to only those persons that are actually
providing recreational activities. There is no reason to infer that
Congress intended for the ``providers of recreational activities''
exemption to apply to persons providing transportation as their core
business or providing transportation concurrently with an activity
(where the transportation is no longer incidental to the activity
itself). These types of activities are distinct from those contemplated
by Congress as exempt because the act of transporting passengers from
one location to another is the central aspect of the service that the
motor carriers are providing.
For instance, FMCSA does not believe Congress intended to exempt
activities where the service provided by the motor carriers mainly
focuses on transportation from one location to another. In such cases,
the motor carrier's business is in fact selling transportation--not
providing recreational activities. A bus company offering scheduled
route service with multiple stops would not fall within the exemption,
for example, merely because one of the scheduled stops was at or near a
water park or a horseback riding stable. Likewise, motor carriers that
advertise and provide alcohol, music, or other ``party'' activities on
board the vehicle as the principal activity or purpose of the
transportation would not be eligible for the exemption.\10\ In
situations like those described above, the activity cannot be completed
and has no purpose without the transportation. The transportation in
such circumstances is integral to the activities, rather than
incidental. Accordingly, the proposed definition in Sec. 372.107 would
explicitly exclude any activity for which: (1) the activity offered or
sold is occurring simultaneously with the transportation; or (2) the
transportation is the primary service offered for sale. FMCSA solicits
comment on whether the exclusions at the end of the proposed definition
increase clarity. Should the agency include these exclusions at the end
of the definition, remove them from the definition, or take another
approach to communicate which activities would not fall within the
definition in a final rule?
---------------------------------------------------------------------------
\10\ FMCSA specifically mentions these activities because the
Agency has received questions from motor carriers regarding the
applicability of the exemption to these activities.
---------------------------------------------------------------------------
The exemption in 49 U.S.C. 13506(b)(4) is already in effect. This
rulemaking is intended to codify the statute and provide clarity
regarding which motor carriers qualify for the exemption. Motor
carriers that qualify for the exemption in 49 U.S.C. 13506(b)(4) are
not subject to the requirement to register for or maintain operating
authority as a motor carrier of passengers.
New motor carriers that need a USDOT number, even those that
qualify for the exemption, would be required to register via URS (MCSA-
1). Such carriers would indicate in the Operation Classification
section that they will be transporting passengers for compensation but
that they are exempt pursuant to 49 U.S.C. 13506. Motor carriers with a
USDOT number that do not currently have operating authority as motor
carriers of passengers and would qualify for the exemption do not have
to file Form OP-1(P) to obtain operating authority.
Motor carriers that currently have operating authority as motor
carriers of passengers and qualify for the exemption are able to
voluntarily revoke their operating authority under 49 U.S.C. 13905(d)
as discussed in the background section above. After doing so, these
motor carriers are no longer required to obtain or reinstate operating
authority and thus, no longer required to have their insurance coverage
or process agent designation on file with FMCSA (49 CFR parts 365 and
366 and Sec. 387.301T). If a motor carrier does not voluntarily revoke
its operating authority registration and fails to maintain evidence of
the required level of insurance coverage on file with FMCSA, its
operating authority registration will be revoked involuntarily by
FMCSA.
These motor carriers would no longer need to have evidence of
financial responsibility on file with FMCSA (through either Form BMC-91
or BMC-91X). However, the inapplicability of the insurance coverage
filing requirement in 49 CFR part 365 and Sec. 387.301T does not
affect a motor carrier's obligation to maintain minimum levels of
financial responsibility as set forth in Sec. 387.33. As discussed
above in the background section, a provider of recreational activities
operating as a motor carrier of passengers is required to maintain
insurance at the minimum prescribed levels while they are in operation.
Additionally, a motor carrier that is no longer subject to Federal
insurance requirements while not in operation may nonetheless still be
required to maintain insurance coverage to meet applicable State
requirements in those States in which the motor carrier operates.
[[Page 40151]]
Some motor carriers may have already voluntarily revoked their
operating authority registration by filing Form OCE-46 under the
exemption in 49 U.S.C. 13506(b)(4). Some of these motor carriers may
have correctly revoked their operating authority because they meet the
requirements in 49 U.S.C. 13506(b)(4) and provide transportation for
activities that fall under the proposed definition in this rulemaking.
If the Agency were to issue its proposed definition as a final rule,
these exempt motor carriers would be permitted to continue to operate
without operating authority. Other motor carriers may have incorrectly
revoked their operating authority because they provide transportation
for one or more activities that they mistakenly believed would fall
under the scope of the statute, but do not, in fact, fall within such
scope as clarified by the proposed definition in this rulemaking. These
motor carriers are currently required, and would continue to be
required, to reinstate their operating authority registration and have
their insurance coverage on file with FMCSA in order to continue
operating.\11\
---------------------------------------------------------------------------
\11\ Motor carriers may reinstate their operating authority
using the procedure detailed at https://ask.fmcsa.dot.gov/app/
answers/detail/a_id/213/~/how-do-i-make-my-mc%2Fff%2Fmx-number-
active-%28request-to-reinstate-or-reactivate.
---------------------------------------------------------------------------
VII. Section-by-Section Analysis
This section-by-section analysis describes the proposed changes in
numerical order.
Section 372.107 Definitions
FMCSA would add a new paragraph (i), which would contain a
definition for recreational activities.
Section 372.113 Providers of Recreational Activities
FMCSA would add a new Sec. 372.113 to subpart A of 49 CFR part
372. This new section would outline the exemption from operating
authority registration in 49 U.S.C. 13506(b)(4).
VIII. Regulatory Analyses
A. Executive Order (E.O.) 12866 (Regulatory Planning and Review), E.O.
13563 (Improving Regulation and Regulatory Review), E.O. 14094
(Modernizing Regulatory Review), and DOT Regulatory Policies and
Procedures
FMCSA has considered the impact of this NPRM under E.O. 12866 (58
FR 51735, Oct. 4, 1993), Regulatory Planning and Review, E.O. 13563 (76
FR 3821, Jan. 21, 2011), Improving Regulation and Regulatory Review,
and by E.O. 14094 (88 FR 21879, Apr. 11, 2023), Modernizing Regulatory
Review. The Office of Information and Regulatory Affairs within the
Office of Management and Budget (OMB) determined that this notice of
proposed rulemaking is not a significant regulatory action under
section 3(f) of E.O. 12866, as supplemented by E.O. 13563 and E.O.
14094, and does not require an assessment of potential costs and
benefits under section 6(a)(3) of that order. Accordingly, OMB has not
reviewed it under that E.O.
Purpose
This rulemaking would codify the exemption for providers of
recreational activities in regulation and define recreational
activities to clarify the scope of this exemption by providing a clear
description of what types of recreational activities do and do not
qualify for the exemption in 49 U.S.C. 13506(b)(4). This would ensure
that providers of recreational activities are aware of their
eligibility for the exemption from filing for operating authority that
FMCSA proposes to add in new Sec. 372.113. Specifically, this
rulemaking would affect motor carriers operating a motor vehicle
designed or used to transport between 9 and 15 passengers (including
the driver), whether operated alone or with a trailer attached to the
transport vehicle, if the motor vehicle is operated by a person that
provides recreational activities and the transportation is provided
within a 150 air-mile radius of the location at which passengers
initially boarded the motor vehicle at the outset of the trip.
This proposed rule is to provide clarity to both motor carriers and
enforcement officials regarding which carriers qualify for the new
exemption in section 23012 of the IIJA as of November 15, 2021. Because
Congress did not define recreational activities and there is no pre-
existing definition of recreational activities in statute or
regulation, FMCSA proposes bringing the FMCSRs into alignment with the
IIJA's exemption. This clarity would resolve possible information
asymmetry currently affecting the regulated industry and enforcement
officials as to which carriers qualify for the operating authority
exemption.
Baseline
For the purposes of this analysis, the changes proposed in this
rule are compared to the baseline established by section 23012 of the
IIJA and the current requirements for providers of recreational
activities under 49 U.S.C. 13901 and 13902 and 49 CFR part 365. As
discussed above, the IIJA created a new exemption from the requirement
to obtain FMCSA operating authority registration for providers of
recreational activities. Accordingly, this exemption has been available
to these motor carriers since the IIJA was enacted on November 15,
2021. Therefore, the incremental impacts of this proposed rule relative
to the baseline lie in how the affected industry and enforcement
officials have been interpreting the term in the absence of a
definition in the FMCSRs.
Uncertainties
The Agency relies on the Motor Carrier Management Information
System (MCMIS) database to obtain information on commercial motor
carriers subject to the FMCSRs. While MCMIS does contain data on
passenger vehicle size (e.g., weight and capacity) and type, it does
not track industry type, nor whether an operating authority exemption
is applicable. Consequently, the Agency knows neither the magnitude of
the population that would be affected by this rulemaking, nor the
degree to which passenger carriers are currently taking advantage of
the exemption. Therefore, FMCSA describes how different carriers would
be impacted by costs and benefits on a per-unit basis, depending on
their current behavior. The Agency invites the public to provide
information on the size of this industry.
Costs
The resulting cost impacts of the definitional clarification
proposed in this rulemaking include changes in paperwork, fees, and
insurance costs associated with maintaining operating authority.
Because there is no pre-existing definition of recreational activities,
motor carriers may be interpreting their eligibility for the operating
authority exemption in varying ways. Depending on current
interpretations, this proposed rule would either increase, decrease, or
have no incremental impact on the degree to which the operating
authority exemptions are used relative to the baseline. Because FMCSA
is unable to ascertain how various carriers interpreted this exemption
set forth by section 23012 of the IIJA in 2021, the Agency estimates
the impacts of this rulemaking based on four hypothetical scenarios.
The Agency also invites the public to provide additional information on
the degree to which this exemption is being used.
Forms
Currently, there are several forms that providers of recreational
activities are responsible for submitting to FMCSA in
[[Page 40152]]
order to maintain operating authority registration. As detailed later
in this analysis, the use of these forms, as explained in table 1, may
change as a result of this proposed rule, depending on how the affected
carriers are interpreting this exemption.
Table 1--Forms Currently Used in Maintaining Operating Authority
------------------------------------------------------------------------
Form Affected groups
------------------------------------------------------------------------
Motor Carrier Automobile Bodily Injury Carriers that must provide
and Property Damage Liability proof of liability insurance
Certificate of Insurance (BMC-91 or meeting the minimum levels of
BMC-91X). financial responsibility.
Motor Carrier Records Change (MCSA- Carriers reinstating operating
5889). authority.
Request for Revocation of Authority Carriers voluntarily revoking
Granted (OCE-46). operating authority.
Application for Motor Passenger Carrier Carriers with an existing USDOT
Authority (OP-1(P)). number wishing to expand to an
operation requiring operating
authority.
------------------------------------------------------------------------
Tables 2 and 3 display the paperwork burden of these forms to
private entities and to the Government, respectively. These estimates
are based on the Information Collection Request (ICR) supporting
statements associated with each form. For example, table 2 shows that
Forms BMC-91 and BMC-91X are estimated to take 10 minutes to complete
by an insurance claims and policy processing clerk at a wage rate \12\
of $38.72, leading to a paperwork burden of $6 (10 minutes x $38.72 =
$6).<SUP>13 14</SUP>
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\12\ DOL, BLS. Occupational Employment and Wage Statistics
(OEWS). National. May 2021. 43-9041 Insurance Claims and Policy
Processing Clerks. Available at: <a href="https://www.bls.gov/oes/current/oes439041.htm">https://www.bls.gov/oes/current/oes439041.htm</a> (accessed Jan. 5, 2023).
\13\ This estimate is based on the calculations used in the ICR
titled, ``Financial Responsibility Motor Carriers, Freight
Forwarders and Brokers,'' covered by OMB Control Number 2126-0017.
\14\ The supporting statement for the ``Financial Responsibility
Motor Carriers, Freight Forwarders and Brokers'' ICR estimates
Government costs for Forms BMC-91 and BMC-91X at $0, as they are
filed electronically.
Table 2--Paperwork Costs to Private Sector (2021$)
----------------------------------------------------------------------------------------------------------------
Hours to
Paperwork Wage submit form Cost per form Filing fee Total cost
----------------------------------------------------------------------------------------------------------------
Forms BMC-91 or BMC-91X by $38.72 0.17 $6 .............. $6
insurance claims processer.....
Form MCSA-5889 by office clerk.. 31.90 0.25 8 80 88
Form OCE-46 by office clerk..... 31.90 0.25 8 .............. 8
Form OP-1(P) by office clerk.... 31.90 2 64 300 364
----------------------------------------------------------------------------------------------------------------
Estimates may not total due to rounding.
Table 3--Paperwork Costs to Government (2021$)
----------------------------------------------------------------------------------------------------------------
GS-9, step 5 Hours to
Paperwork wage submit form Cost per form
----------------------------------------------------------------------------------------------------------------
Form MCSA-5889.................................................. $70.31 0.25 $18
Form OCE-46..................................................... 70.31 0.25 18
Form OP-1(P).................................................... 70.31 6.5 457
----------------------------------------------------------------------------------------------------------------
Estimates may not total due to rounding.
FMCSA computes its estimates of labor costs using data gathered
from several sources. Labor costs comprise wages, fringe benefits, and
overhead. Fringe benefits include paid leave, bonuses and overtime pay,
health and other types of insurance, retirement plans, and legally
required benefits (Social Security, Medicare, unemployment insurance,
and workers compensation insurance). Overhead includes any expenses to
a firm associated with labor that are not part of employees'
compensation; this typically includes many types of fixed costs of
managing a body of employees, such as management and human resource
staff salaries or payroll services. The economic costs of labor to a
firm should include the costs of all forms of compensation and labor-
related expenses. For this analysis, costs of labor to a firm have been
calculated relative to total compensation (base wages, plus fringe
benefits, plus overhead).
The primary source for industry wages is the median hourly wage
data (May 2021) from the U.S. Department of Labor (DOL), Bureau of
Labor Statistics (BLS), Occupational Employment and Wage Statistics
(OEWS).\15\
---------------------------------------------------------------------------
\15\ DOL, BLS. Occupational Employment and Wage Statistics
(OEWS). National. May 2021. Available at: <a href="https://www.bls.gov/oes/current/oes_nat.htm/oesm21nat.zip">https://www.bls.gov/oes/current/oes_nat.htm/oesm21nat.zip</a> (accessed Apr. 12, 2022).
---------------------------------------------------------------------------
BLS does not publish data on fringe benefits for specific
occupations, but it does for the broad industry groups in its Employer
Costs for Employee Compensation release. For office clerk employees,
this analysis uses an average hourly wage of $26.45 and average hourly
benefits of $13.78 for private industry workers in ``transportation and
warehousing'' \16\ to estimate that fringe benefits are equal to 52
percent ($13.78 / $26.45) of wages. For insurance claims processors,
this regulatory impact analysis uses an average hourly wage of $33.93
and average hourly benefits of $16.92 for private industry workers in
``financial activities'' \17\ to estimate that
[[Page 40153]]
fringe benefits are equal to 50 percent ($16.92 / $33.93) of wages.
---------------------------------------------------------------------------
\16\ DOL, BLS. Table 4: Employer costs for Employee Compensation
for private industry workers by occupation and industry group, Dec
2019. Available at: <a href="https://www.bls.gov/news.release/archives/ecec_03192020.pdf">https://www.bls.gov/news.release/archives/ecec_03192020.pdf</a> (accessed Apr. 13, 2022).
\17\ Ibid.
---------------------------------------------------------------------------
For estimating the overhead rates on wages, the Agency used
industry data gathered for the Truck Costing Model developed by the
Upper Great Plains Transportation Institute, North Dakota State
University as a proxy for the overhead cost of employees in the
transportation intermediary and surety and trustee industries.\18\
Research conducted for this model found an average cost of $0.107 per
mile of commercial motor vehicle operation for management and overhead,
and $0.39 per mile for labor, indicating an overhead rate of 27 percent
(27 percent = $0.107 / $0.39, rounded to the nearest whole percent).
---------------------------------------------------------------------------
\18\ Berwick, Farooq. Truck Costing Model for Transportation
Managers. North Dakota State University. Upper Great Plains
Transportation Institute. August 2003. Appendix A, pp. 42-47.
Available at: <a href="http://www.mountain-plains.org/pubs/pdf/MPC03-152.pdf">http://www.mountain-plains.org/pubs/pdf/MPC03-152.pdf</a>
(accessed Apr. 13, 2022).
---------------------------------------------------------------------------
It is assumed that FMCSA reviewers will be Federal Government
employees located in the Washington DC region at the GS-9 Step 5 wage
rate.\19\ OPM does not publish annual rates that include fringe
benefits or overhead. OMB does publish an object class analysis of the
budget of the U.S. Government. The Object Class Analysis estimates
that, in 2021, DOT spent $6,351 million in employee compensation and
$2,840 million in employee benefits. FMCSA estimates a fringe benefit
rate of 45 percent (2,840 / 6,351) for FMCSA personnel. FMCSA uses the
DOT Volpe Center overhead rate of 64 percent for Federal personnel.\20\
The Volpe Center is a Federal fee-for-service research and innovation
center in the DOT. Unlike most Federal agencies, Volpe receives no
direct appropriation from Congress and must cover direct and indirect
expenses through agreements with project sponsors.<SUP>21 22</SUP>
These indirect costs are recovered through the overhead rate charged on
direct labor costs. Volpe employees are compensated according to the
Federal locality pay tables used for all Federal employees and their
labor costs include the same employee benefits. Therefore, FMCSA
believes that the overhead rate for Volpe personnel is similar to the
rate for all DOT personnel.
---------------------------------------------------------------------------
\19\ OPM Pay & Leave Salaries & Wages. Salary Table 2022-DCB,
Hourly Basic (B) Rates by Grade and Step. Available at <a href="https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/22Tables/html/DCB_h.aspx">https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/22Tables/html/DCB_h.aspx</a> (accessed Jan. 5, 2023).
\20\ DOT, Volpe Center. Volpe Project Costs. Available at:
<a href="http://www.volpe.dot.gov/work-with-us/volpe-project-costs">http://www.volpe.dot.gov/work-with-us/volpe-project-costs</a> (accessed
Apr. 9, 2022).
\21\ DOT, Volpe Center. How to Initiate Work. Available at:
<a href="http://www.volpe.dot.gov/work-with-us/how-initiate-work">http://www.volpe.dot.gov/work-with-us/how-initiate-work</a> (accessed
Apr. 13, 2022).
\22\ DOT, Volpe Center. Volpe Project Costs. Available at:
<a href="http://www.volpe.dot.gov/work-with-us/volpe-project-costs">http://www.volpe.dot.gov/work-with-us/volpe-project-costs</a> (accessed
Apr. 13, 2022).
---------------------------------------------------------------------------
Insurance
In addition to submitting forms to FMCSA, providers of recreational
activities wishing to maintain a valid operating authority registration
must also have proof of liability insurance filed with FMCSA, as
explained in section V of this NPRM. The Agency estimates that such
liability insurance currently costs entities an average of $190 per
month for one vehicle, or $2,280 per year ($190 x 12 = $2,280).\23\
Using a range of fleet sizes for illustrative purposes, table 4
presents the estimated costs currently associated with maintaining
liability insurance by fleet size. The Agency invites the public to
provide additional information on these estimates.
---------------------------------------------------------------------------
\23\ Insuranks Online Insurance Comparison Marketplace. <a href="https://www.insuranks.com/commercial-van-insurance">https://www.insuranks.com/commercial-van-insurance</a> (accessed Oct. 31, 2022).
These estimates are quoted from 12 different insurance companies,
including Geico, Progressive, State Farm, and others. The monthly
quotes were summed and then divided by 12 to obtain an estimated
monthly average for the industry: ($115 + $120 + $130 + $183 + $165
+ $180 + $195 + $210 + $221 + $232 + $254 + $270) / 12 = $190.
Table 4--Current Insurance Estimates by Fleet Size (2022$)
------------------------------------------------------------------------
Monthly Yearly
Number of vehicles in fleet premium premium
------------------------------------------------------------------------
1................................................. $190 $2,280
5................................................. 950 11,400
10................................................ 1,900 22,800
------------------------------------------------------------------------
Scenario One: Increase in Exemption Use
Scenario One includes existing providers of recreational activities
that have been eligible for the operating authority exemption
established by section 23012 of the IIJA in 2021 but are not utilizing
it due to the definitional ambiguity of recreational activities. Upon
issuance of this rulemaking, such carriers would understand they
classify as a provider of recreational activities and are, therefore,
eligible for this exemption. This would lead to an incremental increase
in the number of operational authority exemptions being used relative
to the baseline. As explained in detail below, these carriers would be
impacted in different ways by the following costs and cost savings:
financial responsibility compliance costs, operating authority
registration fees, and paperwork costs.
Financial Responsibility Under Scenario One
Carriers under Scenario One that are currently maintaining their
operating authority registration year-round would experience cost
savings associated with maintaining financial responsibility. As
displayed in table 4, the Agency estimates that the liability insurance
required for carriers to maintain operating authority registration
costs an average of $2,280 per year for one vehicle. Carriers under
this scenario would save on insurance costs during the months they are
not in operation (such as off-season months). In other words, carriers
operating one vehicle would only pay for the months they need to be
insured instead of the full $2,280 per year, or $190 per month, to
operate one vehicle.
The Agency estimates a range of annual insurance cost savings from
$190 to $17,100, depending on the number of vehicles a carrier owns and
the number of months they currently maintain operating authority. These
estimates are derived by multiplying the monthly insurance premiums
according to fleet size in table 4 by the number of months they operate
per year. Therefore, if a carrier with one vehicle is currently
operating for one month per year, their annual cost savings would be
$190 (1 month of insurance premiums x 1 vehicle). If a carrier with 10
vehicles is currently operating for 9 months per year, their annual
cost savings would be $1,900 multiplied by 9 months ($17,100).
To illustrate further, table 5 displays estimated insurance cost
savings of this rulemaking for a carrier operating five vehicles, as a
result of no longer incurring year-round insurance costs. For example,
using the values from table 4, the Agency estimates that a carrier
operating five vehicles currently pays an average of $950 per month, or
$11,400 per year, to maintain liability insurance. If such a carrier
only maintained operating authority for 3 months, their cost savings
would be $8,550 per year ($950 x 3 months = $2,850. $2,850-$11,400 =-
$8,550).
Table 5--Insurance Costs by Number of Months in Operation: 5-Vehicle
Fleet (2022$)
------------------------------------------------------------------------
Yearly
premium Cost
Number of months in operation for 5 savings
vehicles
------------------------------------------------------------------------
1................................................. $950 ($10,450)
3................................................. 2,850 (8,550)
9................................................. 8,550 (2,850)
------------------------------------------------------------------------
Note: estimates may not total due to rounding.
[[Page 40154]]
There would also be cost savings as a result of avoided insurance-
related administrative requirements. Currently, carriers must choose an
insurance plan or other acceptable form of financial responsibility,
and have proof filed with FMCSA whenever they apply for or reinstate
operating authority. The Agency estimates that it takes carriers 8
hours to research and identify which insurance company, financial
surety, or bond provider they will use. Assuming this task is performed
by an office clerk, this activity is estimated to cost each carrier
$255 ($31.90 x 8 hours = $255).\24\ The Agency welcomes input from the
public on the amount of time spent researching financial responsibility
options.
---------------------------------------------------------------------------
\24\ DOL, BLS. Occupational Employment and Wage Statistics
(OEWS). National. May 2021. 43-9061 Office Clerks, General.
Available at: <a href="https://www.bls.gov/oes/current/oes439061.htm">https://www.bls.gov/oes/current/oes439061.htm</a>
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------
As displayed in table 2, carriers under Scenario One were also
required to ensure that their financial responsibility provider submit
Forms BMC-91 or BMC-91X to FMCSA at a cost of $6 per form. These
administrative requirements for insurance were no longer required after
the enactment of the IIJA in 2021; therefore, the definitional
clarification in this proposed rule may lead to cost savings of $255 to
the carrier and $6 to the insurance company.
Voluntary Revocation Under Scenario One
As detailed in section V of this NPRM, some carriers under Scenario
One were filing Form OCE-46 to voluntarily revoke their operating
authority registrations during the off-season months so that they did
not need to maintain insurance at the minimum prescribed levels during
those months. To resume operations, the providers were then required to
submit Form MCSA-5889 to reinstate their operating authority
registrations during the months when they were operating. As displayed
in tables 2 and 3, it is estimated to cost $8 to submit Form MCSA-5889,
with a fee of $80 to carriers, and $18 to FMCSA.\25\ Form OCE-46 is
also estimated to cost $8 per carrier and $18 for FMCSA processing
time.\26\ As a result of this rulemaking, carriers under this scenario
would no longer be subject to the costs associated with submitting Form
MCSA-5889 or Form OCE-46.
---------------------------------------------------------------------------
\25\ This estimate is based on the calculations used in the ICR
titled, ``Motor Carrier Records Change Form'' (Form MCSA-5889),
covered by OMB Control Number 2126-0060. The cost of a paper
submission is $6 and the cost of an electronic submission is $0.
\26\ This estimate is based on the calculations used in the ICR
titled ``Request for Revocation of Authority Granted,'' covered by
OMB Control Number 2126-0018.
---------------------------------------------------------------------------
Scenario Two: Decrease in Exemption Use
It is also possible that this rulemaking would limit the use of
this exemption for certain carriers. Because neither FMCSA nor Congress
provided a definition of recreational activities, there may be carriers
that incorrectly believed they are providers of recreational
activities, but upon issuance of this rulemaking, would realize they
are not. These carriers may currently be incorrectly utilizing this
exemption and revoking their operating authority when they were not
eligible to do so. Therefore, such carriers may incur a cost of $88 to
submit Form MCSA-5889 as a result of this rulemaking for reinstatement
of their operating authority (table 2). They would also need to resume
paying for financial responsibility in order to maintain valid
operating authority. Illustrative examples of possible insurance-
related costs are displayed in Tables 4 and 5. FMCSA invites public
comment on the number of carriers that would no longer be using this
exemption as a result of this rulemaking.
Scenario Three: No Incremental Change in Exemption Use
There may also be eligible carriers that correctly interpreted
Congress' intent and have been utilizing the exemption correctly since
the IIJA's enactment. These carriers are not expected to be impacted by
this proposed rule relative to the baseline. They have already gone
through the steps of voluntarily revoking their operating authority
with FMCSA, are maintaining financial responsibility only while in
operation, and are not paying fees or completing paperwork associated
with maintaining operating authority.
Scenario Four: New Providers
This proposed rule may also affect eligible providers considering
engaging in providing recreational activities in the future. If there
are new carriers considering entering this field that were not aware of
the IIJA exemption, they would no longer need to account for the
following costs as a result of this rulemaking: year-round financial
responsibility premiums, financial responsibility-related
administrative costs, and operating authority fees and paperwork. The
Agency invites public comment on the industry's trajectory and how many
new entrants can be expected annually.
Prior to the enactment of the IIJA, new providers of recreational
activities would have had to submit the ``Application for Motor
Passenger Carrier Authority'' (Form OP-1(P)).\27\ The Agency estimates
that this form costs $64 with a $300 fee for carriers, and $457 in
Government costs (Tables 2 and 3, respectively).\28\ Additionally, as
described in the Financial Responsibility Under Scenario One section,
the avoided insurance-related administrative costs would be $6 for
insurance companies and $255 for carriers. An illustrative example of
potential avoided insurance premium costs is presented in table 5.
---------------------------------------------------------------------------
\27\ Applicants that have never held a USDOT number or any other
registration issued by FMCSA must file the URS online application
(Form MCSA-1) to obtain a USDOT number and register for operating
authority.
\28\ This estimate is based on calculations used in the ICR
titled ``Licensing Applications for Motor Carrier Operating
Authority,'' covered by OMB Control Number 2126-0016.
---------------------------------------------------------------------------
Government Costs
These changes would not require additional training for enforcement
personnel. The Agency expects that the definitional clarification set
forth in this NPRM would be communicated to FMCSA personnel and the
Agency's State-based enforcement partners through existing means, such
as policy updates and ongoing training. The Agency would be impacted by
the costs and cost savings associated with this NPRM, as outlined in
table 3 ($457 for Form OP-1(P), $18 for Form OCE-46 and Form MCSA-
5889).
Benefits
The affected entities would be providers of recreational activities
that typically consist of physically demanding outdoor experiences or
excursions that do not have transportation as an integral part of the
activity itself. Overall, the outdoor recreation economy accounted for
1.9 percent ($454 billion) of current-dollar gross domestic product
(GDP) for the nation in 2021. Hawaii, Montana, Vermont, Alaska, and
Maine are among the States where outdoor recreation as a percent of
that States' GDP ranks the highest. For example, in 2021, outdoor
recreation accounted for $4.4 billion of Hawaii's $91.1 billion overall
GDP, or 4.8 percent--the highest proportion of any State. In terms of
actual levels, the States that produced the highest outdoor recreation
GDP in 2021 were California ($54.7 billion), Florida ($41.9 billion),
and Texas ($37.5 billion).
[[Page 40155]]
Differences in interpretation between regulated entities and
enforcement officials may be hindering consistent enforcement
practices, thereby impacting business-related decisions in providing
transportation for recreational activities. This rulemaking would
resolve this information asymmetry by creating a common understanding
between FMCSA and motor carriers. Because this rulemaking may also lead
to an increase in exemption use, it would benefit existing carriers by
improving the efficiency of their business operations and increasing
both consumer and producer surplus.
For new potential providers of recreational activities that were
not aware of this exemption, this rulemaking may encourage new entrants
into the field. The costs of maintaining year-round financial
responsibility and paying registration fees may have posed a barrier to
entry that discouraged some entities from participating in this
industry. Therefore, this proposed rule may introduce new businesses
into the field, increase competition and market efficiency, and benefit
consumers by creating more options when choosing a provider of
recreational activities.
B. Congressional Review Act
This proposed rule is not a major rule as defined under the
Congressional Review Act (5 U.S.C. 801-808).\29\
---------------------------------------------------------------------------
\29\ A major rule means any rule that OMB finds has resulted in
or is likely to result in (a) an annual effect on the economy of
$100 million or more; (b) a major increase in costs or prices for
consumers, individual industries, geographic regions, Federal,
State, or local government agencies; or (c) significant adverse
effects on competition, employment, investment, productivity,
innovation, or on the ability of United States-based enterprises to
compete with foreign-based enterprises in domestic and export
markets (Sec. 389.3).
---------------------------------------------------------------------------
C. Advance Notice of Proposed Rulemaking
Under 49 U.S.C. 31136(g), FMCSA is required to publish an advance
notice of proposed rulemaking (ANPRM) or proceed with a negotiated
rulemaking, if a proposed rule is likely to lead to the promulgation of
a major rule. As this proposed rule is not likely to result in the
promulgation of a major rule, the Agency is not required to issue an
ANPRM or to proceed with a negotiated rulemaking.
D. Regulatory Flexibility Act
The Regulatory Flexibility Act of 1980, Public Law 96-354, 94 Stat.
1164 (5 U.S.C. 601-612), as amended by the Small Business Regulatory
Enforcement Fairness Act of 1996 (Pub. L. 104-121, 110 Stat. 857, March
29, 1996) and the Small Business Jobs Act of 2010 (Pub. L. 111-240, 124
Stat. 2504, September 27, 2010), requires Federal agencies to consider
the effects of the regulatory action on small business and other small
entities and to minimize any significant economic impact. The term
small entities comprises small businesses and 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. Accordingly, DOT policy requires an
analysis of the impact of all regulations on small entities, and
mandates that agencies strive to lessen any adverse effects on these
businesses. FMCSA has not determined whether this proposed rule would
have a significant economic impact on a substantial number of small
entities. Therefore, FMCSA is publishing this initial regulatory
flexibility analysis (IRFA) to aid the public in commenting on the
potential small business impacts of the proposals in this NPRM. We
invite all interested parties to submit data and information regarding
the potential economic impact that would result from adoption of the
proposals in this NPRM. We will consider all comments received in the
public comment process when making a determination in the final
regulatory flexibility analysis.
An IRFA must contain the following:
1. a description of the reasons why the action by the agency is
being considered;
2. a succinct statement of the objective of, and legal basis
for, the proposed rule;
3. a description of and, where feasible, an estimate of the
number of small entities to which the proposed rule will apply;
4. a description of the projected reporting, recordkeeping, and
other compliance requirements of the proposed rule, including an
estimate of the classes of small entities which will be subject to
the requirement and the type of professional skills necessary for
preparation of the report or record;
5. an identification, to the extent practicable, of all relevant
Federal rules that may duplicate, overlap, or conflict with the
proposed rule.
6. a description of any significant alternatives to the proposed
rule which accomplish the stated objectives of applicable statutes
and which minimize any significant economic impact of the proposed
rule on small entities.
1. Why the Action by the Agency is Being Considered
Section 23012 of the IIJA amended 49 U.S.C. 13506 by adding a new
exemption in paragraph (b)(4) from the operating authority registration
requirements. FMCSA is proposing to add a new regulatory section
incorporating that statutory exemption and also including a definition
for the exempt operations. The exemption from operating authority
registration applies to motor carriers operating a motor vehicle
designed or used to transport not fewer than 9, and not more than 15
passengers (including the driver) whether operated alone or with a
trailer attached to the transport vehicle, if the motor vehicle is
operated by a person that provides recreational activities and the
transportation is provided within a 150 air-mile radius of the location
at which passengers initially boarded the motor vehicle at the outset
of the trip. The new statutory exemption did not include a definition
of recreational activities, creating some ambiguity in the exemption's
applicability. The Agency is proposing to codify the exemption in
regulation and to remove ambiguity by defining the term.
2. The Objectives of and Legal Basis for the Proposed Rule
As discussed in section 1 of this IRFA, FMCSA is proposing to add a
new regulatory section incorporating the statutory exemption in 49
U.S.C. 13506 that was added by section 23012 of the IIJA (see 49 U.S.C.
13506(b)(4)). The statutory provision, which relates to operating
authority registration and requires, in part, that the motor vehicle be
operated ``by a person that provides recreational activities,'' does
not define recreational activities. This NPRM proposes to define
recreational activities to clarify the scope of the exemption
applicability.
The FMCSA Administrator has the authority to carry out the
functions relating to the registration requirements in 49 U.S.C. 13901
and 13902, as delegated by the Secretary under Sec. 1.87(a)(5). The
requirements of these sections, which are enforced under Sec. 392.9a
(``Operating authority''), are the basis for the rules governing
applications for operating authority registration in 49 CFR part 365.
3. A Description of, and Where Feasible an Estimate of, the Number of
Small Entities to Which the Proposed Rule Will Apply
Small entity is defined in 5 U.S.C. 601. Section 601(3) defines a
small entity as having the same meaning as small business concern under
section 3 of the Small Business Act. This includes any small business
concern that is independently owned and operated and is not dominant in
its field of operation. Section 601(4), likewise includes within the
definition of small entities not-for-profit enterprises that are
independently owned and operated and are not dominant in their fields
of operation. Additionally, section 601(5) defines
[[Page 40156]]
small entities as governments of cities, counties, towns, townships,
villages, school districts, or special districts with populations less
than 50,000.
This NPRM would affect providers of recreational activities to
motor carriers operating a motor vehicle designed or used to transport
not fewer than 9, and not more than 15 passengers (including the
driver) whether operated alone or with a trailer attached to the
transport vehicle, if the motor vehicle is operated by a person that
provides recreational activities and the transportation is provided
within a 150 air-mile radius of the location at which passengers
initially boarded the motor vehicle at the outset of the trip.
Providers of recreational activities affected by this proposed rule
operate under many different North American Industry Classification
System \30\ (NAICS) codes with differing size standards. FMCSA provides
a wide range of NAICS codes in the recreational activities industry, in
order to capture all of the potential NAICS codes that providers of
recreational activities may operate under. In doing so, FMCSA is
highlighting many entities that perform various other functions beyond
transporting passengers to and from recreational activities. As shown
in table 6 below, the SBA size standard for providers of recreational
activities ranges from $8 million in revenue per year for the All Other
Amusement Recreation Industries NAICS national industry, to $41.5
million in revenue per year for Tour Operators and Racetracks.
---------------------------------------------------------------------------
\30\ More information about NAICS is available at: <a href="http://www.census.gov/eos/www/naics/">http://www.census.gov/eos/www/naics/</a> (accessed Dec. 21, 2022).
Table 6--SBA Size Standards for Selected Industries
[in millions of 2019$]
------------------------------------------------------------------------
SBA size standard
NAICS code NAICS industry description in millions
------------------------------------------------------------------------
Subsector 487--Scenic and Sightseeing Transportation
------------------------------------------------------------------------
487110................... Scenic and Sightseeing $18
Transportation, Land.
487210................... Scenic and Sightseeing 12.5
Transportation, Water.
487990................... Scenic and Sightseeing 22
Transportation, Other.
------------------------------------------------------------------------
Subsector 561--Administrative and Support Services
------------------------------------------------------------------------
561520................... Tour Operators............ 41.5
------------------------------------------------------------------------
Subsector 711--Performing Arts, Spectator Sports, and Related Industries
------------------------------------------------------------------------
711212................... Racetracks................ 41.5
711219................... Other Spectator Sports.... 14.5
------------------------------------------------------------------------
Subsector 713--Amusement, Gambling, and Recreation Industries
------------------------------------------------------------------------
713910................... Golf Courses and Country 16.5
Clubs.
713920................... Skiing Facilities......... 31.0
713940................... Fitness and Recreational 15.5
Sports Centers.
713990................... All Other Amusement 8.0
Recreation Industries.
------------------------------------------------------------------------
FMCSA examined data from the 2017 Economic Census, the most recent
Census for which data were available, to determine the percentage of
firms that have revenue at or below SBA's thresholds within each of the
NAICS industries.\31\ Boundaries for the revenue categories used in the
Economic Census do not exactly coincide with the SBA thresholds.
Instead, the SBA threshold generally falls between two different
revenue categories. However, FMCSA was able to make reasonable
estimates as to the percent of small entities within each NAICS code.
---------------------------------------------------------------------------
\31\ U.S. Census Bureau. 2017 Economic Census. Available at:
<a href="https://data.census.gov/cedsci/table?q=EC1700&n=48-49&tid=ECNSIZE2017.EC1700SIZEREVEST&hidePreview=true">https://data.census.gov/cedsci/table?q=EC1700&n=48-49&tid=ECNSIZE2017.EC1700SIZEREVEST&hidePreview=true</a> (accessed Dec.
18, 2022).
---------------------------------------------------------------------------
The Agency estimates that many entities affected by this NPRM may
fall under the Scenic and Sightseeing Transportation NAICS subsector
(487). Firms in this subsector utilize transportation equipment to
provide recreation and entertainment. These operations are distinct
from passenger transportation carried out for other types of for-hire
transportation. The recreational activities involved are local in
nature, usually involving a same-day return to the point of
departure.\32\ Industry groups under this subsector include Scenic and
Sightseeing Transportation, Land (4871), Scenic and Sightseeing
Transportation, Water (4872), and Scenic and Sightseeing
Transportation, Other (4879).
---------------------------------------------------------------------------
\32\ US Census Bureau 2022 NAICS Definition. Available at
<a href="https://www.census.gov/naics/?input=48&year=2022&details=487">https://www.census.gov/naics/?input=48&year=2022&details=487</a>
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------
The Scenic and Sightseeing Transportation, Land NAICS national
industry (487110) has a revenue size standard of $18 million, which
falls between two Economic Census revenue categories, $10 million and
$25 million. This industry comprises firms engaged in various outdoor
excursions, including horse-drawn sightseeing rides. The percentages of
Scenic and Sightseeing Transportation, Land with revenue less than
these amounts ranged from 97 percent to 98 percent. Because the SBA
threshold is closer to the higher of these two boundaries, FMCSA has
assumed that the percent of Scenic and Sightseeing Transportation, Land
entities that are small will be closer to 98 percent and is using that
figure.
For Scenic and Sightseeing Transportation, Water (487210), the
$12.5 million SBA threshold falls between two Economic Census revenue
categories, $10 million and $25 million. Entities in this national
industry are primarily engaged in providing scenic and sightseeing
transportation on water, such as fishing boat charter operation. The
percentages of Scenic and Sightseeing Transportation, Water with
revenue less than these amounts ranged from 97 percent to 99 percent.
Because
[[Page 40157]]
the SBA threshold is closer to the lower of these two boundaries, FMCSA
has assumed that the percent of these entities that are small will be
closer to 97 percent and is using that figure.
Scenic and Sightseeing Transportation, Other (487990) focuses on
all other scenic and sightseeing transportation, such as hot air
balloon rides and glider excursions. The SBA size standard for this
national industry is $22 million. The $22 million SBA threshold falls
between two Economic Census revenue categories, $10 million and $25
million. The percentages of these entities with revenue less than these
amounts were 93 percent and 98 percent. Because the SBA threshold is
closer to the higher of these two boundaries, FMCSA has assumed that
the percent of these providers that are small will be closer to 98
percent and is using that figure.
Firms falling under the Travel Arrangement and Reservation Services
industry group (5615) may also be impacted by this NPRM. This industry
group comprises the Travel Agencies (561510), Tour Operators (561520),
and Convention and Visitors Bureaus (561591) national industries.\33\
The Agency assumes that providers of recreational activities fall under
the Tour Operators national industry.
---------------------------------------------------------------------------
\33\ U.S. Census Bureau 2022 NAICS Definition. Available at
<a href="https://www.census.gov/naics/?input=56&year=2022&details=5615">https://www.census.gov/naics/?input=56&year=2022&details=5615</a>
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------
Tour Operators (561520) focuses on arranging and assembling tours,
including travel or wholesale tour operators. The SBA size standard for
this national industry is $41.5 million, which falls between two
Economic Census revenue categories, $25 million and $100 million. The
percentages of Tour Operators with revenue less than these amounts were
92 percent and 100 percent. The Agency presents a high-end estimate of
100 percent due to limitations in Economic Census data availability.
Revenue data for firms with revenue less than $100,000, which would be
considered small, are suppressed by the Economic Census to avoid
disclosing for individual companies. Because the Agency is unable to
ascertain the revenue for the suppressed firms, the high-end estimate
assumes that such firms may fall under the $41.5 million SBA threshold
and would be considered small. The low-end estimate assumes the
suppressed firms are not small. Because the SBA threshold is closer to
the lower of these two boundaries, FMCSA has assumed that the percent
of Tour Operators that is small will be closer to 92 percent and is
using that figure.
The Agency estimates that many providers of recreational activities
affected by this NPRM would also fall under the Arts, Entertainment,
and Recreation sector (71). This sector includes a wide range of firms
operating facilities that meet varied cultural, entertainment, and
recreational interests of patrons.\34\ Subsectors under this group
include Performing Arts, Spectator Sports, and Related Industries
(711), Amusement, Gambling, and Recreational Industries (713), and
others.
---------------------------------------------------------------------------
\34\ U.S. Census Bureau 2022 NAICS Definition. Available at
<a href="https://www.census.gov/naics/?input=71&year=2022&details=71">https://www.census.gov/naics/?input=71&year=2022&details=71</a>
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------
The industry groups under the Spectator Sports and Related
Industries (711) subsector cover Spectator Sports (7112). Spectator
Sports includes the Racetracks (711212) and Other Spectator Sports
(711219) national industries.
The Racetracks national industry (711212) focuses on firms
operating racetracks without casinos, such as auto, motorcycle,
snowmobile, and horse races. The SBA size standard for this national
industry is $41.5 million. The $41.5 million SBA threshold falls
between two Economic Census revenue categories, $25 million and $100
million. The percentages of these entities with revenue less than these
amounts were 83 percent and 100 percent.\35\ Because the SBA threshold
is closer to the lower of these two boundaries, FMCSA has assumed that
the percent of Racetracks entities that are small will be closer to 83
percent and is using that figure.
---------------------------------------------------------------------------
\35\ The Agency presents a high-end estimate of 100 percent due
to limitations in Economic Census data availability. Revenue data
for firms with revenue less than $100,000, which would be considered
small, are suppressed by the Economic Census to avoid disclosing for
individual companies. Because the Agency is unable to ascertain the
revenue for the suppressed firms, the high-end estimate assumes that
such firms may fall under the $41.5 million SBA threshold. The low-
end estimate assumes the suppressed firms are not small.
---------------------------------------------------------------------------
Other Spectator Sports (711219) focuses on independent athletes,
owners of racing participants (such as cars, dogs, and horses), and
firms engaged in specialized services in support of said participants.
The SBA size standard for this national industry is $14.5 million,
which falls between two Economic Census revenue categories, $10 million
and $25 million. The percentages of these entities with revenue less
than these amounts were 82 percent and 100 percent.\36\ Because the SBA
threshold is closer to the lower of these two boundaries, FMCSA has
assumed that the percent of Other Spectator Sports entities that are
small will be closer to 82 percent and is using that figure.
---------------------------------------------------------------------------
\36\ The Agency presents a high-end estimate of 100 percent due
to limitations in Economic Census data availability. Revenue data
for firms with revenue less than $100,000, which would be considered
small, are suppressed by the Economic Census. Because the Agency is
unable to ascertain the revenue for the suppressed firms, the high-
end estimate assumes that such firms may fall under the $14.5
million SBA threshold. The low-end estimate assumes the suppressed
firms are not small.
---------------------------------------------------------------------------
The industry groups under the Amusement, Gambling, and Recreation
Industries (713) subsector include Amusement Parks and Arcades (7131),
Gambling Industries (7132), and Other Amusement and Recreation
Industries (7139).\37\ The Agency estimates the entities affected by
this NPRM would fall into the third industry group, Other Amusement and
Recreation Industries (7139). This group, as detailed below, covers
firms operating golf courses and country clubs, skiing facilities, and
all other amusement and recreation activities.\38\
---------------------------------------------------------------------------
\37\ U.S. Census Bureau 2022 NAICS Definition. Available at
<a href="https://www.census.gov/naics/?input=71&year=2022&details=713">https://www.census.gov/naics/?input=71&year=2022&details=713</a>
(accessed Jan. 5, 2023).
\38\ U.S. Census Bureau 2022 NAICS Definition. Available at
<a href="https://www.census.gov/naics/?input=71&year=2022&details=7139">https://www.census.gov/naics/?input=71&year=2022&details=7139</a>
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------
Entities falling under Golf Courses and Country Clubs (713910)
primarily engage in operating such facilities, and providing food and
beverage services, equipment rental, or golf instruction. The SBA size
standard for this national industry is $16.5 million, which falls
between two Economic Census revenue categories, $10 million and $25
million. The percentages of Golf Courses and Country Clubs with revenue
less than these amounts were 95 percent and 99 percent. Because the SBA
threshold is closer to the lower of these two boundaries, FMCSA has
assumed that the percent of these entities that are small will be
closer to 95 percent and is using that figure.
Skiing Facilities (713920) industries primarily operate downhill,
cross country, or related skiing areas, and provide food and beverage
services, equipment rental, and ski instruction. The SBA size standard
for this national industry is $31 million, which falls between two
Economic Census revenue categories, $25 million and $100 million. The
percentages of Skiing Facilities with revenue less than these amounts
were 93 percent and 98 percent.\39\ Because the SBA threshold is
[[Page 40158]]
closer to the lower of these two boundaries, FMCSA has assumed that the
percent of these facilities that are small will be closer to 93 percent
and is using that figure.
---------------------------------------------------------------------------
\39\ The Agency presents a high-end estimate of 98 percent which
includes assumptions about limitations in Economic Census data. Some
revenue data for firms that would be considered small (revenue
categories of $100,000 or more and $250,000 to $499,999) are
suppressed by the Economic Census. Because the Agency is unable to
ascertain the revenue for the suppressed firms, the high-end
estimate assumes that such firms may fall under the $31 million SBA
threshold. The low-end estimate assumes the suppressed firms are not
small.
---------------------------------------------------------------------------
The Agency estimates that the majority of entities affected by this
NPRM would fall under the All Other Amusement Recreation Industries
national industry (713990). This includes whitewater rafting, hunting,
horseback riding stables, boating clubs, canoeing, archery and shooting
ranges, hiking, and others. The SBA size standard for this national
industry is $8 million. The $8 million SBA threshold falls between two
Economic Census revenue categories, $5 million and $10 million. The
percentages of these providers with revenue less than these amounts
were 60 percent and 99.6 percent. The Agency estimates a wide range in
estimates due to limitations in Economic Census data for this NAICS
category. Specifically, of the 12,688 firms in this industry, 12,631
have revenue between $100,000 and $10 million. However, data on small
entities with revenue under $250,000 are suppressed. There are 7,490
small entities (59 percent) with revenue between $250,000 and $5
million, and 139 firms with revenue between $5 million and $10 million
(1.1 percent). Of the 12,688 firms in All Other Amusement Recreation
Industries, there are firms 5,002 without revenue data (39.4 percent).
The high-end estimate assumes all such firms are small (99.6 percent)
and FMCSA is using that figure.
Table 7 below shows the complete estimates of the number of small
entities within the national industries that may be affected by this
rulemaking.
Table 7--Estimates of Numbers of Small Entities
----------------------------------------------------------------------------------------------------------------
Total number Number of Percent of all
NAICS code Description of firms small entities firms (%)
----------------------------------------------------------------------------------------------------------------
487110........................... Scenic and Sightseeing 520 512 98
Transportation, Land.
487210........................... Scenic and Sightseeing 1,129 1,097 97
Transportation, Water.
487990........................... Scenic and Sightseeing 169 165 98
Transportation, Other.
561520........................... Tour Operators............... 2,175 1,991 92
711212........................... Racetracks................... 299 248 83
711219........................... Other Spectator Sports....... 1,916 1,577 82
713910........................... Golf Courses and Country 8,076 7,712 95
Clubs.
713920........................... Skiing Facilities............ 203 189 93
713990........................... All Other Amusement 12,688 7,629 60
Recreation Industries.
----------------------------------------------------------------------------------------------------------------
4. A Description of the Proposed Reporting, Recordkeeping and Other
Compliance Requirements of the Proposed Rule, Including an Estimate of
the Classes of Small Entities Which Will be Subject to the Requirement
and the Type of Professional Skills Necessary for Preparation of the
Report or Record
This proposed rule would not result in new recordkeeping
requirements.
5. An Identification, to the Extent Practicable, of All Relevant
Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rule
FMCSA is not aware of any relevant Federal rules that may
duplicate, overlap, or conflict with the proposed rule.
6. A Description of Any Significant Alternatives to the Proposed Rule
Which Accomplish the Stated Objectives of Applicable Statutes and Which
Minimize Any Significant Economic Impact of the Proposed Rule on Small
Entities
Given that the recreational activities exemption was statutorily
mandated, FMCSA did not have an alternative or discretion as to whether
to adopt the exemption but did consider whether to propose a definition
of the term recreational activities or to remain silent. FMCSA also
considered the alternative of adding a definition without including
specific examples. However, FMCSA believes that remaining silent or
proposing a definition without specific examples could result in
confusion or inconsistent enforcement and that it was better to propose
a definition with examples consistent with the legislative intent to
minimize any significant economic impact on small entities.
7. Description of Steps Taken by a Covered Agency To Minimize Costs of
Credit for Small Entities
FMCSA is not a covered agency as defined in section 609(d)(2) of
the Regulatory Flexibility Act and has taken no steps to minimize the
additional cost of credit for small entities.
8. Requests for Comment To Assist Regulatory Flexibility Analysis
FMCSA requests comments on all aspects of this initial regulatory
flexibility analysis.
E. Assistance for Small Entities
In accordance with section 213(a) of the Small Business Regulatory
Enforcement Fairness Act of 1996 (Pub. L. 104-121, 110 Stat. 857),
FMCSA wants to assist small entities in understanding this proposed
rule so they can better evaluate its effects on themselves and
participate in the rulemaking initiative. If the proposed rule would
affect your small business, organization, or governmental jurisdiction
and you have questions concerning its provisions or options for
compliance, please consult the person listed under FOR FURTHER
INFORMATION CONTACT.
Small businesses may send comments on the actions of Federal
employees who enforce or otherwise determine compliance with Federal
regulations to the Small Business Administration's Small Business and
Agriculture Regulatory Enforcement Ombudsman (Office of the National
Ombudsman, see <a href="https://www.sba.gov/about-sba/oversight-advocacy/office-national-ombudsman">https://www.sba.gov/about-sba/oversight-advocacy/office-national-ombudsman</a>) 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 FMCSA, call 1-888-REG-FAIR (1-888-734-3247).
DOT has a policy regarding the rights of small entities to regulatory
enforcement
[[Page 40159]]
fairness and an explicit policy against retaliation for exercising
these rights.
F. Unfunded Mandates Reform Act of 1995
The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538)
(UMRA) requires Federal agencies to assess the effects of their
discretionary regulatory actions. 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 $178 million (which is the
value equivalent of $100 million in 1995, adjusted for inflation to
2021 levels) or more in any 1 year. Though this NPRM would not result
in such an expenditure, and the analytical requirements of UMRA do not
apply as a result, the Agency discusses the effects of this proposed
rule elsewhere in this preamble.
G. Paperwork Reduction Act
This proposed rule contains no new information collection
requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3520).
H. E.O. 13132 (Federalism)
A rule has implications for federalism under section 1(a) of E.O.
13132 if it has ``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.'' FMCSA has determined that this proposed rule would not
have substantial direct costs on or for States, nor would it limit the
policymaking discretion of States. Nothing in this document preempts
any State law or regulation. Therefore, this proposed rule does not
have sufficient federalism implications to warrant the preparation of a
Federalism Impact Statement.
I. Privacy
The Consolidated Appropriations Act, 2005,\40\ requires the Agency
to assess the privacy impact of a regulation that will affect the
privacy of individuals. This NPRM would not require the collection of
personally identifiable information.
---------------------------------------------------------------------------
\40\ Public Law 108-447, 118 Stat. 2809, 3268, note following 5
U.S.C. 552a (Dec. 4, 2014).
---------------------------------------------------------------------------
The Privacy Act (5 U.S.C. 552a) applies only to Federal agencies
and any non-Federal agency that receives records contained in a system
of records from a Federal agency for use in a matching program.
The E-Government Act of 2002,\41\ requires Federal agencies to
conduct a Privacy Impact Assessment (PIA) for new or substantially
changed technology that collects, maintains, or disseminates
information in an identifiable form. No new or substantially changed
technology would collect, maintain, or disseminate information as a
result of this rulemaking. Accordingly, FMCSA has not conducted a PIA.
---------------------------------------------------------------------------
\41\ Public Law 107-347, sec. 208, 116 Stat. 2899, 2921 (Dec.
17, 2002).
---------------------------------------------------------------------------
In addition, the Agency submitted a Privacy Threshold Assessment
(PTA) to evaluate the risks and effects the proposed rulemaking might
have on collecting, storing, and sharing personally identifiable
information. The DOT Privacy Office has determined that this rulemaking
does not create privacy risk.
J. E.O. 13175 (Indian Tribal Governments)
This proposed rule does not have Tribal implications under E.O.
13175, Consultation and Coordination with Indian Tribal Governments,
because it does 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. National Environmental Policy Act of 1969
FMCSA analyzed this proposed rule pursuant to the National
Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321 et seq.) and
determined this action is categorically excluded from further analysis
and documentation in an environmental assessment or environmental
impact statement under FMCSA Order 5610.1 (69 FR 9680), Appendix 2,
(6)(b). The categorical exclusion (CE) in paragraph (6)(b) covers
regulations which are editorial or procedural, such as, those updating
addresses or establishing application procedures, and procedures for
acting on petitions for waivers, exemptions and reconsiderations,
including technical or other minor amendments to existing FMCSA
regulations. The proposed requirements in this rule are covered by this
CE, there are no extraordinary circumstances present, and the proposed
action does not have the potential to significantly affect the quality
of the environment.
List of Subjects in 49 CFR Part 372
Agricultural commodities, Buses, Cooperatives, Freight forwarders,
Motor carriers, Moving of household goods, Seafood.
Accordingly, FMCSA proposes to amend 49 CFR part 372 as follows:
PART 372--EXEMPTIONS, COMMERCIAL ZONES, AND TERMINAL AREAS
0
1. The authority citation for part 372 continues to read as follows:
Authority: 49 U.S.C. 13504 and 13506; Pub. L. 105-178, sec.
4031, 112 Stat. 418; and 49 CFR 1.87.
0
2. Amend Sec. 372.107 by adding paragraph (i) to read as follows:
Sec. 372.107 Definitions.
* * * * *
(i) Recreational activities. The term recreational activities means
activities consisting of an outdoor experience or excursion typically
of a physical or athletic nature which require transportation for the
sole purpose of moving customers to another location or locations where
the outdoor experience or excursion will take place and collecting
those customers to transport them back to the place of initial boarding
or another outpost of the motor carrier. Recreational activities
include but are not limited to hiking, biking, horseback riding,
canoeing, whitewater rafting, water trails, tubing, skiing,
snowshoeing, snowmobiling, hunting, fishing, mountain climbing, and
swimming. The term does not include any activity for which:
(1) The activity offered or sold is occurring simultaneously with
the transportation; or
(2) For which the transportation is the primary service offered for
sale.
0
3. Add Sec. 372.113 to read as follows:
Sec. 372.113 Providers of recreational activities.
Transportation by a motor vehicle designed or used to transport not
fewer than 9, and not more than 15, passengers (including the driver),
whether operated alone or with a trailer attached for the transport of
recreational equipment, is exempted from regulation promulgated
pursuant to part B of title 49 U.S.C. subtitle IV if:
(a) The motor vehicle is operated by a person that provides
recreational activities;
(b) The transportation is provided within a 150 air-mile radius of
the location at which passengers initially boarded the motor vehicle at
the outset of the trip; and
[[Page 40160]]
(c) In the case of a motor vehicle transporting passengers over a
route between a place in a State and a place in another State, the
person operating the motor vehicle is lawfully providing transportation
of passengers over the entire route in accordance with applicable State
law.
Issued under authority delegated in 49 CFR 1.87.
Robin Hutcheson,
Administrator.
[FR Doc. 2023-13081 Filed 6-20-23; 8:45 am]
BILLING CODE 4910-EX-P
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</html>Indexed from Federal Register on June 21, 2023.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.